Kendrick Resources invested £902,242 in exploration and evaluation assets at its Bonya rare earth project in Namibia in the first half of 2026, as the company’s loss widened to £1.68 million after operating expenses rose sharply.
The London-listed explorer reported a loss after tax of £1.679 million for the six months ended 30 June, compared with £128,271 during the same period last year.
Operating expenses increased from £127,762 to about £1.68 million, with much of the increase arising from a £1.329 million award under the company’s annual incentive scheme for directors and employees.
The £1,329,411 award was recognised in the accounts as a share-based payment liability. The incentive scheme is linked to increases in Kendrick’s share price over a 12-month performance period.
Kendrick said the remuneration committee and board will determine the allocation among eligible participants and whether the award will ultimately be settled in cash or equity.
Kendrick recorded £902,242 in additions to exploration and evaluation assets in Namibia during the six months, and confirmed the entire amount related to Bonya.
“The Namibian exploration and evaluation additions in the period relate to the Bonya rare earths project in Namibia which comprises the Teufelskuppe and Kieshöhe projects,” the company said.
The group’s cash-flow statement also records £902,242 spent on purchasing exploration and evaluation assets during the period.
Kendrick acquired a 70% interest in Bonya earlier this year and has since made the project its flagship exploration asset.
Exploration has concentrated on Teufelskuppe, where extensive rare earth mineralisation has been identified, while work has expanded to Kieshöhe, a second carbonatite complex within the wider Bonya project.
The company is working towards a maiden mineral resource estimate for Bonya by the end of November and is developing a preliminary processing flowsheet in Germany.
Kendrick ended June with £1.570 million in cash and cash equivalents, up from £6,525 at the end of December 2025, following a series of financing transactions during the half-year.
The company said it raised £3.351 million through convertible loan notes and equity fundraisings during the period.
These included convertible loan facilities secured in February, a £1 million equity fundraising in March and a further £1.764 million equity fundraising in May.
The cash-flow statement shows Kendrick used £1.914 million in operating activities during the six months, while another £902,242 went into exploration and evaluation assets.
Despite those outflows, cash increased by £1.563 million during the period.
Kendrick’s balance sheet also improved following the fundraising.
The group ended June with net assets of £1.001 million, compared with net liabilities of £1.215 million at the end of December 2025.
Total assets rose from £56,086 to £3.556 million.
At the end of June, the group’s assets included £1.570 million in cash, £1.072 million in trade and other receivables and £902,242 in exploration and evaluation assets.
Total liabilities stood at £2.554 million, compared with £1.271 million at the end of December.
Trade and other payables amounted to £1.829 million, including the £1.329 million share-based payment liability, while convertible loan borrowings stood at £721,912.
Despite its improved cash and net asset position, Kendrick said it will need additional funding to continue its activities.
The company expects to record another operating loss and said it will need further capital to finance working capital, ongoing exploration, and potential new project acquisitions.
Kendrick said it has successfully raised funding in the past but acknowledged there is no guarantee sufficient financing will be available when required.
The accounts identify a material uncertainty that may cast significant doubt on the group’s ability to continue as a going concern.
The board nevertheless believes Kendrick can raise additional funds when needed and has prepared the interim financial statements on a going-concern basis.
The company is concentrating its exploration activities on Bonya in Namibia and the Blue Fox copper project in Zambia while limiting expenditure on non-core projects.
Bonya has become the centre of Kendrick’s Namibian programme, with drilling continuing at Teufelskuppe and Kieshöhe ahead of the maiden resource estimate targeted for late November.
