Company: ALM
Filing Date: 2025-07-11
Form Type: F-10/A
Source: 0001641172-25-018741
Chunk: 40

Company: Almonty Industries Inc.
Filing Date: 2025-07-11
Form: F-10/A
Chunk 40
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lenecks, weather-related events, or third-party disruptions, could adversely affect operations.

Impairment of Assets

The Company conducts annual impairment assessments
of goodwill and, at the end of each reporting period, the Company assesses whether there is any indication that long-lived assets (such
as mining properties and plant and equipment) may be impaired. If an indicator of impairment exists, the recoverable amount of the asset
is calculated in order to determine if any impairment loss is required. Testing for impairment involves a comparison of the recoverable
amount of the cash-generating unit to its carrying value. An impairment charge is recognized for any excess of the carrying amount of
the asset group or reporting unit over its recoverable amount. For example, during fiscal 2019, the Company completed the mining of the
remaining ore and commenced reprocessing the tailings inventory at the Los Santos Mine. During the period in which tailings were reprocessed,
the Company achieved WO recovery rates below those previously estimated and, as a result, recorded an impairment of tailings
inventory of $5.8 million, representing an adjustment to the lower of cost and net realizable value. As a result of the impairment test
performed for fiscal 2019, impairments of $3.3 million and $1 million were recorded to property, plant, and equipment and mineral property
acquisition and development, respectively, based on the estimated fair value fewer costs to sell off the remaining property, plant, and
equipment at the Los Santos Mine. In addition, as a result of an impairment test performed for fiscal 2021, the Company also recognized
an impairment reversal of $4.1 million to tailings inventory related to the Los Santos Mine, based on the estimated lower of cost and
net realizable value.

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The assessment for impairment is subjective and
requires management to make estimates and assumptions for a number of factors including estimates of production levels, mineral reserves
and Mineral Resources, operating costs and capital expenditures reflected in the Company’s life-of-mine plans, as well as economic
factors beyond management’s control, such as tungsten prices and observable net asset value multiples. Should management’s
estimates and assumptions regarding these factors be incorrect, the Company may be required to realize impairment charges, which will
reduce the Company’s earnings. The timing and amount of such impairment charges is difficult to predict.

Risks Related to Property Titles

The acquisition
of title to mineral properties is a very precise and time-consuming