PHOSCO LTD — Interim / Quarterly Report 2021

Jul 28, 2021

Quarterly Activity & Cashflow Reports for Quarter ending

30 June 2021

Summary:

• Process to transition to technical management underway
• Reviewing new opportunities
• Progress during quarter impacted by COVID-19

Celamin Holdings Limited (ASX: CNL) ("Celamin" or the "Company") is pleased to present details of its activities for the June 2021 Quarter. During the Quarter the Company continued preparation for the commencement of a GAP Analysis at the Chaketma Phosphate Project in Tunisia ("Chaketma") to assess the work program required to complete a feasibility study, although progress has been impacted by COVID-19 lockdown measures both in Australia and Tunisia.

Chaketma is a potential large-scale, world class phosphate development asset, which comprises six prospects over a total area of 56km2 . It hosts a total JORC compliant Inferred Resource of 130Mt @ 20.5% P₂O₅1 , confirmed from drilling at only two of the project's six prospects with access by road, and proximal to rail and gas pipelines (see Figure 1).

Celamin has achieved success with the court processes to recover its interest in CPSA, the holder of the Chaketma Phosphate Project. Final steps to restore the Company's interest in CPSA including Celamin's control of CPSA are underway, albeit hampered by the impact of COVID-19 on the Tunisian courts and administrative functions. Tunisian Mining Services (TMS), the entity that committed the fraudulent transfer of Celamin's shares in CPSA, has repeatedly failed to comply with its legal obligations, obstructing development of Chaketma.

Celamin Holdings Ltd

ASX Code: CNL

ACN 139 255 771 ABN 82 139 255 771

Board and Management:

Robin Widdup Chairman Simon Eley Managing Director Taz Aldaoud Non-Exec Director Tim Markwell Alternate Director to Robin Widdup and Interim CEO

Company Secretary

Stefan Ross

Securities on Issue

195,045,594	ordinary shares
12,000,000	unlisted options
500,000	unlisted options

Contact

Phone: +61 (0)3 9692 7222 Fax: +61 (0)3 9077 9233 Email: info@celamin.com

Registered Office Address

Level 4, 100 Albert Road South Melbourne VIC 3205

Website

www.celaminholdingsltd.com

1 ASX announcements dated 9 November 2012 and 18 June 2013

Figure 1: Location of the Chaketma Phosphate Project

TMS owes Celamin US$4.9M in costs and damages, which accrues daily. Celamin will continue to enforce its rights pursuant to court orders as well as force the sale of TMS assets to recover funds to offset the damages and costs owed.

Notwithstanding the continued illegal conduct of TMS, Celamin is committed to investing in Chaketma due to the considerable benefits that the country and all stakeholders will derive from a project of this size and nature.

Management Transition

Celamin is planning to advance the Chaketma Phosphate Project upon finally resolving the dispute with TMS, including delivering a Feasibility Study.

In keeping with the increasing technical focus of the Company, Celamin is transitioning its executive team, including key capabilities for project development. As part of this strategic transition, Alternative Director Mr Tim Markwell has become interim Chief Executive Officer responsible for technical work and helping recruit a technical team. Celamin's Managing Director Mr Simon Eley's salary will be commensurately reduced by 50% and taken entirely as shares, subject to shareholder approval. Any additional time worked above 2.5 days will be paid at a rate of A$1,000/day. His duties as Managing Director will be focussed on final enforcement of Celamin's arbitration success and resolution of the dispute with TMS to advance Chaketma, something he has been instrumental in achieving since his initial appointment in July 2018.

Mr Markwell is a geologist with 25 years+ experience. It is envisaged that the Company will seek to appoint a full-time CEO in due course upon the return to active feasibility work at the Chaketma Phosphate Project and exploration on Celamin's base metals projects.

Mr Craig Smyth has been appointed interim CFO during the transition period and will assist the Company with financial reporting and long-term business and financial planning. Mr Smyth is a chartered accountant with 25+ years' experience having previously worked for Coopers and Lybrand, ANZ Investment Bank and Credit Suisse First Boston. Mr Smyth has been with Lion Selection since 2005.

Both Mr Markwell and Mr Smyth will each be paid a rate of $1,000/day for time worked in their roles as interim CEO and interim CFO respectively, with a monthly limit of $10,000 each. Their fees for services provided will be settled through Lion Manager Pty Ltd ('Lion Manager') pursuant to the Services Agreement between the Company and Lion Manager, noting that Lion Manager is a substantial shareholder of the Company. All fees that are paid through the Services Agreement are on an arm's length basis.

Mr Widdup, Mr Markwell and Mr Smyth are Directors of Lion Manager, and Mr Widdup and Mr Smyth have a relevant interest in Lion Manager. For the avoidance of doubt Lion Manager is a Director-related entity of Mr Widdup and Mr Markwell.

Currently all Directors and executive management are accruing pay to be taken in Celamin shares subject to Celamin shareholder approval.

Change in Company Secretary

The Company has also announced that specialist Company Secretarial, Governance and Accounting firm, Leydin Freyer, continues to undertake the Company Secretarial role noting that Ms Melanie Leydin has stepped down as appointed Company Secretary and Mr Stefan Ross appointed in the office holder position as Company Secretary. Ms Leydin will continue to support the Company via Leydin Freyer.

Mr Ross has over 10 years of experience in accounting and secretarial services for ASX Listed companies. His extensive experience includes ASX compliance, corporate governance control and implementation, statutory financial reporting and board and secretarial support.

New Opportunities Being Assessed

While the Chaketma Phosphate Project remains the focus for Celamin, the Company has been approached regarding several new opportunities which are currently being assessed. Currently all opportunities are confidential, early stage and incomplete.

Corporate update

Celamin held cash and cash equivalents of approximately A$0.6m at the end of the June 2021 quarter.

Payments to related parties and their associates during the quarter as outlined in Section 6 of the accompanying Appendix 5B to this quarterly activity report were $46,000. These payments are related to Director salaries and consulting fees paid to directors and to their related entities during the June 2021 quarter.

This announcement is authorised for release to the market by the Board of Directors of Celamin Holdings Limited.

For further information, please contact:

Simon Eley

Managing Director T: +61 (03) 9692 7222 E: info@celamin.com

Mining Tenement	Location	BeneficialPercentageheld	Interestacquired/farm-induring thequarter	InterestDisposed/farmout during thequarter
Chaketma	Tunisia	50.99%*		-
Zeflana	Tunisia	100%	-	-
Ain El Bouma	Tunisia	100%	-	-
Zaouiet Sidi Mbarek	Tunisia	100%	-	-
Djebba	Tunisia	100%	-	-
Djebba 2	Tunisia	100%	-	-

Lists of Tenements Held

* The Chaketma Phosphate Permit is 100% held by CPSA. On 13 November 2020, Celamin announced that it had recovered its interest in CPSA following the transfer by the court appointed expert as outlined in the arbitration award returning Celamin's interest in Chaketma and payment of damages and costs amongst other matters.

Notwithstanding the above, the Director General of CPSA is yet to officially recognise the transfer on the company files as required by the Company Code in Tunisia. Until this is completed, Celamin is unable to exercise its rights as a majority shareholder, namely to access company information, call a shareholder meeting or subsequently appoint board members.

Appendix 5B

Mining exploration entity or oil and gas exploration entity quarterly cash flow report

Name of entity

CELAMIN HOLDINGS LIMITED

82 139 255 771 30 June 2021

ABN Quarter ended ("current quarter")

	Consolidated statement of cash flows	Current quarter$A'000	Year to date (12months)$A'000
1.	Cash flows from operating activities
1.1	Receipts from customers	-	-
1.2	Payments for
	(a)exploration & evaluation	(5)	(135)
	(b)development	-	-
	(c)production	-	-
	(d)staff costs	(46)	(251)
	(e)administration and corporate costs	(131)	(626)
1.3	Dividends received (see note 3)	-	-
1.4	Interest received	-	1
1.5	Interest and other costs of finance paid	-	-
1.6	Income taxes paid	-	-
1.7	Government grants and tax incentives	-	-
1.8	Other (provide details if material)
	- Government Incentive	-	27
1.9	Net cash from / (used in) operatingactivities	(182)	(984)

2.		Cash flows from investing activities
2.1		Payments to acquire or for:
	(a)	entities	-
	(b)	tenements	-
	(c)	property, plant and equipment	-
	(d)	exploration & evaluation	-
	(e)	investments	-
	(f)	other non-current assets	-

	Consolidated statement of cash flows	Current quarter$A'000	Year to date (12months)$A'000
2.2	Proceeds from the disposal of:
	(a)entities	-	-
	(b)tenements	-	-
	(c)property, plant and equipment	-	-
	(d)investments	-	-
	(e)other non-current assets	-	-
2.3	Cash flows from loans to other entities	-	-
2.4	Dividends received (see note 3)	-	-
2.5	Other (provide details if material)	-	-
2.6	Net cash from / (used in) investingactivities	-	-

3.	Cash flows from financing activities
3.1	Proceeds from issues of equity securities(excluding convertible debt securities)	-	-
3.2	Proceeds from issue of convertible debtsecurities	-	-
3.3	Proceeds from exercise of options	-	-
3.4	Transaction costs related to issues of equitysecurities or convertible debt securities	-	-
3.5	Proceeds from borrowings	-	-
3.6	Repayment of borrowings	-	-
3.7	Transaction costs related to loans andborrowings	-	-
3.8	Dividends paid	-	-
3.9	Other (provide details if material)	-	-
3.10	Net cash from / (used in) financingactivities	-	-

4.	Net increase / (decrease) in cash andcash equivalents for the period
4.1	Cash and cash equivalents at beginning ofperiod	757	1,562
4.2	Net cash from / (used in) operatingactivities (item 1.9 above)	(182)	(984)
4.3	Net cash from / (used in) investing activities(item 2.6 above)	-	-
4.4	Net cash from / (used in) financing activities(item 3.10 above)	-	-

Consolidated statement of cash flows		Current quarter$A'000	Year to date (12months)$A'000
4.5	Effect of movement in exchange rates oncash held	-	(3)
4.6	Cash and cash equivalents at end ofperiod	575	575

5.	Reconciliation of cash and cashequivalentsat the end of the quarter (as shown in theconsolidated statement of cash flows) to therelated items in the accounts	Current quarter$A'000	Previous quarter$A'000
5.1	Bank balances	575	757
5.2	Call deposits	-	-
5.3	Bank overdrafts	-	-
5.4	Other (provide details)	-	-
5.5	Cash and cash equivalents at end ofquarter (should equal item 4.6 above)	575	757

6.	Payments to related parties of the entity and theirassociates	Current quarter$A'000
6.1	Aggregate amount of payments to related parties and theirassociates included in item 1	46
6.2	Aggregate amount of payments to related parties and theirassociates included in item 2	-
Note: if any amounts are shown in items 6.1 or 6.2, your quarterly activity report must include a description of, and anexplanation for, such payments.

Appendix 5B Mining exploration entity or oil and gas exploration entity quarterly cash flow report

7.	Financing facilitiesNote: the term "facility' includes all forms of financingarrangements available to the entity.Add notes as necessary for an understanding of thesources of finance available to the entity.	Total facilityamount at quarterend$A'000	Amount drawn atquarter end$A'000
7.1	Loan facilities	-	-
7.2	Credit standby arrangements	-	-
7.3	Other (please specify)	-	-
7.4	Total financing facilities	-	-
7.5	Unused financing facilities available at quarter end		-
7.6	Include in the box below a description of each facility above, including the lender, interestrate, maturity date and whether it is secured or unsecured. If any additional financingfacilities have been entered into or are proposed to be entered into after quarter end,include a note providing details of those facilities as well.
	N/A

8.	Estimated cash available for future operating activities	$A'000
8.1	Net cash from / (used in) operating activities (item 1.9)	(182)
8.2	(Payments for exploration & evaluation classified as investingactivities) (item 2.1(d))	-
8.3	Total relevant outgoings (item 8.1 + item 8.2)	(182)
8.4	Cash and cash equivalents at quarter end (item 4.6)	575
8.5	Unused finance facilities available at quarter end (item 7.5)	-
8.6	Total available funding (item 8.4 + item 8.5)	575
8.7	Estimated quarters of funding available (item 8.6 divided byitem 8.3)	3.16
	Note: if the entity has reported positive relevant outgoings (ie a net cash inflow) in item 8.3, answer item 8.7 as "N/A".Otherwise, a figure for the estimated quarters of funding available must be included in item 8.7.
8.8	If item 8.7 is less than 2 quarters, please provide answers to the following questions:
8.8.1Does the entity expect that it will continue to have the current level of net operatingcash flows for the time being and, if not, why not?Answer: Not applicable as item 8.7 is greater than 2.8.8.2Has the entity taken any steps, or does it propose to take any steps, to raise furthercash to fund its operations and, if so, what are those steps and how likely does itbelieve that they will be successful?
Answer: Not applicable as item 8.7 is greater than 2.

8.8.3 Does the entity expect to be able to continue its operations and to meet its business objectives and, if so, on what basis?

Answer: Not applicable as item 8.7 is greater than 2.

Note: where item 8.7 is less than 2 quarters, all of questions 8.8.1, 8.8.2 and 8.8.3 above must be answered.

Compliance statement

• 1 This statement has been prepared in accordance with accounting standards and policies which comply with Listing Rule 19.11A.
• 2 This statement gives a true and fair view of the matters disclosed.

Date: 29 July 2021

Authorised by: The Board.................................................................. (Name of body or officer authorising release – see note 4)

Notes

• 1. This quarterly cash flow report and the accompanying activity report provide a basis for informing the market about the entity's activities for the past quarter, how they have been financed and the effect this has had on its cash position. An entity that wishes to disclose additional information over and above the minimum required under the Listing Rules is encouraged to do so.
• 1. If this quarterly cash flow report has been prepared in accordance with Australian Accounting Standards, the definitions in, and provisions of, AASB 6: Exploration for and Evaluation of Mineral Resources and AASB 107: Statement of Cash Flows apply to this report. If this quarterly cash flow report has been prepared in accordance with other accounting standards agreed by ASX pursuant to Listing Rule 19.11A, the corresponding equivalent standards apply to this report.
• 1. Dividends received may be classified either as cash flows from operating activities or cash flows from investing activities, depending on the accounting policy of the entity.
• 1. If this report has been authorised for release to the market by your board of directors, you can insert here: "By the board". If it has been authorised for release to the market by a committee of your board of directors, you can insert here: "By the [name of board committee – eg Audit and Risk Committee]". If it has been authorised for release to the market by a disclosure committee, you can insert here: "By the Disclosure Committee".
• 1. If this report has been authorised for release to the market by your board of directors and you wish to hold yourself out as complying with recommendation 4.2 of the ASX Corporate Governance Council's Corporate Governance Principles and Recommendations, the board should have received a declaration from its CEO and CFO that, in their opinion, the financial records of the entity have been properly maintained, that this report complies with the appropriate accounting standards and gives a true and fair view of the cash flows of the entity, and that their opinion has been formed on the basis of a sound system of risk management and internal control which is operating effectively.