NOTES TO FINANCIAL STATEMENTS 31 December 2025 4 FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND CAPITAL MANAGEMENT (cont’d) The fair value of the Group’s and Company’s trade and other receivables is assessed in aggregate under the discounted cash flow valuation technique described above. The receivables of the Group and the Company are both recoverable through the same underlying coal mines. Accordingly, only one set of discounted cash flow is used. US$Nil (2024 : US$Nil) fair value changes was recognised in profit or loss during the year. Other than as disclosed above, the carrying amounts of financial assets and financial liabilities recorded at amortised cost approximate their respective fair values due to the relatively short-term maturity of these financial instruments. The fair values of other classes of financial assets and financial liabilities are disclosed in the respective notes to the financial statements. (d) Capital management policies and objectives The Group and Company manage their capital to ensure that the Group and Company will be able to continue as a going concern while maximising the return to stakeholders through the optimisation of the debt and equity balance. The capital structures of the Group consist of debt, which includes the lease liabilities (Note 21) and bank borrowings (Note 22) and equity attributable to owners of the Company, which comprises issued capital, treasury shares, reserves and retained earnings. The capital structures of the Company consist of debt, which comprises bank borrowings (Note 22) and equity attributable to owners of the Company, which comprises issued capital, treasury shares, reserves and retained earnings. Management regularly monitors compliance with the financial covenants imposed by financial institutions for the facilities granted to the Group. As at the end of the reporting period, the Group is in compliance with externally imposed financial covenants requirements, which include limitations on the Group’s ability to create or permit to exist any security over shares of certain subsidiaries of the Company. The Group’s net debt to equity ratio as at the end of the reporting period is as follows: (i) Total debt is defined as long-term and short-term borrowings, as described in Notes 21 and 22. The Group’s and the Company’s overall strategy remains unchanged from prior year. 5 RELATED COMPANIES TRANSACTIONS Related companies in these financial statements refer to members of the Company’s group of companies. Transactions between the Company and its subsidiaries, which are related companies of the Company, have been eliminated on consolidation and are not disclosed. The intercompany balances are unsecured, interest-free and repayable on demand, except as discussed below. During the year, the Company provided loan to a subsidiary amounting to US$10,000,000. The balance is unsecured, bears interest rate of 7.6% per annum and is due for repayment on 31 December 2026. Group 2025 2024 US$ US$ Total debt (i) 263,123,767 233,874,368 Cash and bank balances (105,140,469) (118,073,057) Net debt 157,983,298 115,801,311 Total equity 536,644,991 540,001,711 Net debt to equity ratio 29% 21% 84
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