European Metals : 17 Mar 2021Half Year Report

EUROPEAN METALS HOLDINGS LIMITED

ARBN 154 618 989

INTERIM FINANCIAL REPORT

31 DECEMBER 2020

Note: The information contained in this condensed report is to be read in conjunction with European Metals Holding Limited's 2020 annual report and any announcements made by the company during the half-year period ended 31 December 2020

European Metals Holdings Limited

ARBN 154 618 989

INTERIM FINANCIAL REPORT 31 DECEMBER 2020

CORPORATE DIRECTORY

Directors
Mr Keith Coughlan
Mr Richard Pavlik
Mr Kiran Morzaria
Mr Lincoln Palmer Bloomfield, Jr	Non-Executive Director
Company Secretary
Mr Dennis Wilkins
Registered Office in Australia	Registered Office in Czech Republic
Suite 2	GEOMET s.r.o.
11 Ventnor Avenue	Ruska 287
WEST PERTH WA 6005	417 01 Dubi Bystrice
Telephone: [phone]	The Czech Republic
Facsimile: [phone]	Telephone: [phone]
Email:www.europeanmet.com
Nominated Nomad & Joint Broker
Registered Address & Place of Incorporation	WH Ireland Ltd
Rawlinson & Hunter	24 Martin Lane
Woodbourne Hall	LONDON EC4R 0DR
PO Box 3162	UNITED KINGDOM
Road Town
Joint Broker
TORTOLA VG1 110
BRITISH VIRGIN ISLANDS	Shard Capital Partners LLP
23rd Floor, 20 Fenchurch Street
Share Register	LONDON EC3M 3BY
Computershare Investor Services Limited	UNITED KINGDOM
Level 11
UK Depository
172 St Georges Terrace
PERTH WA 6000	Computershare Investor Services plc
Telephone: [phone]	The Pavilions
Facsimile: [phone]	Bridgewater Road
BRISTOL BS99 6ZZ
Auditor	UNITED KINGDOM
Stantons International Audit & Consulting Pty Ltd
Reporting Accountants (UK)
Level 2, 1 Walker Avenue
WEST PERTH WA 6005	Chapman Davis LLP
Telephone: [phone]	2 Chapel Court
Facsimile: [phone]	LONDON SE1 1HH
UNITED KINGDOM
Securities Exchange Listing - Australia
Securities Exchange Listing - United Kingdom
Australian Securities Exchange Limited
Level 40, Central Park	London Stock Exchange plc
152-158 St Georges Terrace	10 Paternoster Square
PERTH WA 6000	LONDON EC4M 7LS
UNITED KINGDOM
ASX Code: EMH
AIM Code: EMH
Securities Exchange Listing - NASDAQ
Nasdaq Inc
151 W. 42nd Street
New York City
NY 10036 United States
NASDAQ Code: ERPNF

Executive Chairman Executive Director Non-Executive Director

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European Metals Holdings Limited

ARBN 154 618 989

INTERIM FINANCIAL REPORT 31 DECEMBER 2020

CONTENTS

Directors' Report 3

Auditor's Independence Declaration 6

Consolidated Statement of Profit or Loss and Other Comprehensive Income 7

Consolidated Statement of Financial Position 8

Consolidated Statement of Changes in Equity 9

Consolidated Statement of Cash Flows 10

Condensed Notes to the Consolidated Financial Statements 11

Directors' Declaration 19

Independent Audit Review Report to the members of European Metals Holdings Limited 20

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European Metals Holdings Limited

ARBN 154 618 989

INTERIM FINANCIAL REPORT 31 DECEMBER 2020

DIRECTORS' REPORT

Your Directors submit the financial report of the consolidated group for the half year ended 31 December 2020.

Directors

The names of the directors who held office during or since the end of the half-year.

Mr Keith Coughlan	Executive Chairman	Appointed 30 June 2020
Appointed Director 6 September 2013
Mr Richard Pavlik	Executive Director	Appointed 27 June 2017
Mr Kiran Morzaria	Non-Executive Director	Appointed 10 December 2015
Mr Lincoln Palmer Bloomfield, Jr	Non-Executive Director	Appointed 4 January 2021
Results of Operations

The consolidated loss for the half year ended 31 December 2020 amounted to $2,317,327 (2019: $1,591,389 loss).

Review of Operations

For the reporting period the Company continued to manage the advancement of the Cinovec Lithium/Tin Project in Czech Republic. The macro conditions relative to the Project have been very strong for the period. Global lithium prices steadily increased, with more dramatic increases seen immediately post the period. In addition to the global conditions, support within the European Union (the Company's region of operations) for battery metals project development has increased substantially.

Some significant highlights of the project development and EMH level initiatives for the period are as follows.

• • Partnership with European Union body

The Company announced a support and financing agreement with KIC InnoEnergy SE ("EIT InnoEnergy") on 28 July 2020. The body is the principal facilitator and organiser of the European Battery Alliance. The purpose of the agreement is to facilitate the accelerated construction financing and ultimate commercialisation of Cinovec, by assisting in:

• - Sourcing construction finance;

• - Securing grant funding; and

• - Assisting in offtake introductions and negotiations.

EIT InnoEnergy leads the European Battery Alliance which was initiated by the European Commission to create a competitive and sustainable battery cell manufacturing value chain in Europe. Since the initiation of this agreement, overall support for green energy initiatives, the development of a European Battery Industry and the continued growth of the Electric Vehicle industry has increased significantly.

• • Measured Resource Drilling Commenced

Measured Resource drilling commenced at the Cinovec Project in early August 2020, with the key aims of

• - completing a total of nineteen resource drill holes for a total of 5,550 m;

• - completing a further two hydro-geological drill holes and four geotechnical drill holes once resource drilling has been completed; and

• - the provision of approximately 10t of drill core for further metallurgical testing and to generate samples.

Drilling is aimed at converting a sufficient portion of the existing Indicated Mineral Resource to the Measured Resource category and subsequently to a Mineral Reserve, to cover the first two years of the scheduled mining plan and obtaining a sufficient amount of ore samples for the next phase of metallurgical testing. The majority of the material will be utilised in the pilot scale testing for the Front End Engineering Design ("FEED") Study. A total of nineteen diamond drill holes will be completed for 5,550 metres. A further four geotechnical holes along the planned underground decline route will be drilled and logged subsequent to the completion of the resource drilling. This data will allow final development ready designs to be completed for the declines.

Post period, the Company reported positive results from that portion of this programme that had been completed. The programme has been slightly delayed due to a combination of COVID19 and weather events and is now expected to complete in April 21.

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