Cloudbreak Discovery Reports FY 2025 Loss and Strategic Pivot to Gold Exploration

Cloudbreak Discovery’s FY 2025: Losses booked, balance sheet reset, and a bold pivot to WA gold

Cloudbreak Discovery has published its final results for the year to 30 June 2025. It’s a year of house-cleaning and repositioning: big write-downs on legacy assets, a sharpened focus on Western Australian gold and copper, and fresh capital raised after the year end to fund exploration.

Cloudbreak describes itself as a project generator and royalty/mineral investment company. In plain English, that means originating projects, farming them out, and aiming to keep upside through royalties (a cut of future revenues) or minority interests – rather than building mines itself.

Headline numbers you should know

Metric	FY 2025	FY 2024 (restated)
Loss for the year	£2,707,587	£1,627,519
Administrative expenses	£611,681	£943,302
Finance income	£175,130	£344,198
Impairment of debentures	£1,416,442	£474,428
Impairment of investments	£428,707	£117,260
Cash at year end	£53,197	£195,157
Total assets	£261,404	£2,489,509
Net assets/(liabilities)	(£352,938)	£947,323
Convertible debenture receivable	£175,000	£1,581,428
Trade and other payables	£566,294	£1,498,938
Shares in issue (30 June 2025)	1,253,075,632	729,210,696

Strategic pivot to Western Australia gold and copper

The board has reoriented Cloudbreak away from passive royalty holdings and US energy interests, and towards near-revenue, high-potential mineral exploration in stable jurisdictions – with a clear tilt to Western Australia.

• Darlot West gold project: Initiated in 2025 and subsequently expanded. Post year end, exploration began with mapping and sampling, and on 22 September 2025 the company exercised its option to acquire Phase 1 covering approximately 60.6 km².
• Pipeline options: Option rights secured over an 888 km² Au/Cu project in the Paterson Province and an option over the Crofton Gold Project, both in Western Australia.
• Management refresh: Appointment of Executive Chairman Peter Huljich and Managing Director Tom Evans, bringing investment banking and resource-sector finance experience.

Why it matters: WA offers well-understood geology and supportive mining frameworks. For a small cap, access to infrastructure and permitting clarity can be as decisive as geology.

Legacy portfolio cleared out – the impairment story

The numbers look heavy because Cloudbreak has recognised substantial impairments across the legacy portfolio. The largest is the write-down of the G2 Energy Corp debenture linked to the Masten Unit oil project in Texas.

• Debenture impairment: £1,416,442, reducing the receivable to £175,000 as at 30 June 2025, consistent with a post-year sale of the debenture for £175,000.
• Investments impairment: £428,707, including a full impairment of the Lonestar Lithium holding given limited activity and weaker lithium market conditions.
• Intangibles impairment: Remaining US exploration assets, such as Bobcat (Idaho) and Elk Creek (Pennsylvania), were fully impaired following the strategy shift.
• Prior period restatement: A £771,553 adjustment re-recognised certain Cronin-related creditors at 30 June 2024; these were later settled in shares.

My take: unpleasant but necessary. Clearing the decks improves transparency. If the new exploration focus gains traction, investors can judge progress without the fog of legacy receivables and mismatched assets.

Funding, dilution and going concern

At 30 June, cash was thin at £53,197 with current liabilities of £614,342, and the group reported net liabilities of £352,938. After the year end, Cloudbreak raised £900,000 via two placings:

• £300,000 on 22 August 2025 at 0.25 pence per share (120,000,000 shares).
• £600,000 on 28 August 2025 at 0.475 pence per share (126,315,790 shares). The placing was described as a 10% discount.

The company also sold its US oil assets associated with the Masten Unit to G2 Energy Corp for £100,000 (cash staged over six months) and cleared circa £75,000 of liabilities. That improves liquidity headroom and removes a distraction.

The auditors referenced a material uncertainty over going concern, which the board acknowledges. Management is confident of future investor support, but the reality remains: Cloudbreak is pre-revenue, funding exploration through equity. Expect further raises if drill-ready targets emerge.

What to watch in the next 12–24 months

• Darlot West work programme: Continued mapping, rock-chip and soil sampling, high-resolution magnetics, and drill target definition. Early, low-cost wins here would be a strong signal.
• Paterson Au/Cu/Mo project: Progress on tenure, targeting and any earn-in or acquisition milestones across the 888 km² footprint near the Telfer region.
• Deal flow and partnerships: The strategy is to retain upside through royalties, carried interests or minority stakes. Look for smart earn-in structures that cap cash burn.
• Balance sheet discipline: Admin costs fell to £611,681, which helps. Keep an eye on payables, share issuance, and the cadence of exploration spend versus results.
• Governance bedding-in: New leadership should translate the pivot into crisp execution, timely updates, and clear KPIs on exploration.

Positives and risks for retail investors

Why this could work

• Focused pivot to a Tier-1 jurisdiction with abundant precedents for discovery and development.
• Legacy assets sold or impaired, removing a drag on the story and freeing management bandwidth.
• Post-year financing of £900,000 provides runway for near-term fieldwork.

What could go wrong

• Exploration risk: early-stage work may not yield economic targets.
• Funding risk: further equity raises are likely, with potential dilution.
• Execution risk: options over projects need converting into firm interests on attractive terms.

Josh’s view: a credible reboot, now it’s all about WA execution

Cloudbreak has drawn a line under a complicated past year. The impairments and restatement are painful but honest, and the shift to Western Australia is strategically sound. Post-year fundraises and the sale of US oil interests have stabilised the near-term cash picture, though the going concern flag is a reminder that delivery is everything.

If Darlot West and the Paterson project generate compelling drill targets quickly, sentiment can turn, and the company’s “project generator” playbook – keeping upside via royalties or carried interests – can start to create tangible value without blowing out the share count. Until then, this remains a high-risk, early-stage explorer that needs to keep proving it can turn fieldwork into catalysts.

Source documents

• Annual Report and Financial Statements (to be made available on the company website)
• FCA National Storage Mechanism (report to be uploaded)