GST Court Claim Deepens Amara Minerals’ Funding Risks

Going Concern Warning Overshadows Exploration Push

Amara Minerals Limited (ASX:AM3) has put funding risk at the centre of its FY2026 accounts, with its auditor warning that the company’s ability to continue as a going concern depends on further equity funding and careful cash management. The audit opinion was not modified, but the material uncertainty is a direct reminder that Amara remains an exploration company without operating revenue sufficient to fund its plans.

The company reported a net loss of $8.79 million for the year ended 30 June 2026, compared with a $2.03 million loss a year earlier. Cash fell to $2.08 million from $3.09 million, while operating activities consumed $1.27 million and investing activities absorbed a further $2.87 million. Directors said their cash-flow forecast supports the going-concern basis for the 12 months from signing, while also acknowledging that future capital raisings will be required.

Exploration Assets Grow as Capital Reserves Tighten

Amara capitalised $8.05 million of exploration expenditure at year-end, up from $5.61 million, as it concentrated on the Lauriston and Apollo gold and antimony projects in Victoria. The year included about 3,900 metres of diamond drilling at Lauriston and four holes totalling about 1,060 metres at Apollo, with the company reporting gold and antimony mineralisation at Comet, New Trojan and beneath historical workings in the Dig Fault Zone.

Those results remain exploration outcomes rather than mineral resources or reserves. The accounts state that Amara’s projects have no known resources or reserves, and management’s stated objective is to progress Lauriston and Apollo towards JORC-compliant mineral resources. The company will need to fund further drilling and technical work while meeting minimum exploration commitments of $1.13 million across the next five years.

Challenger Dispute Adds Financial and Legal Risk

The balance sheet also carries the residue of Amara’s exit from the Challenger Gold Project. The company exchanged its remaining 49% interest in Challenger Mines for 10 million Great Divide Mining shares and retained a 1% net smelter royalty, capped at 125,000 ounces. Great Divide has since commenced Supreme Court of New South Wales proceedings over an ATO-related GST liability, seeking $1.056 million plus interest, penalties and costs, or a declaration that Amara must indemnify it.

Amara has recorded an $891,539 expense linked to the ATO matter, excluding accrued interest, but disputes Great Divide’s claim and has filed a cross-claim seeking to unwind elements of the December 2025 settlement. The case is listed for directions on 2 October 2026. The eventual financial effect remains uncertain, but the dispute arrives alongside $3.38 million of current payables, including amounts associated with the GST matter and deferred Lauriston consideration.

Share Issues Fund Strategy at a Cost

Amara issued 1.018 billion shares during the year, raising $4.21 million net of capital-raising costs, and ended June with 3.087 billion shares on issue. Its financing activities generated $3.13 million in net cash, but the company also carries 1.545 billion options and 579 million unexercised performance rights, creating a substantial potential source of future dilution if exercised.

The company’s strategic repositioning is now complete in name as well as portfolio: shareholders approved the move from Adelong Gold to Amara Minerals in May, with trading commencing under AM3. A further 27.27 million shares were issued to Janus Capital in August 2026 in connection with the Lauriston acquisition, leaving the next funding round, exploration results and the GST litigation as the clearest tests of whether the Victorian strategy can progress without placing further pressure on shareholders.