Perception Capital Corp. IV Reports Decrease in Net Income and Faces Uncertainty in Business Combination

RCF Acquisition Corp., now known as Perception Capital Corp. IV, reported a net income of $702,959 for the fiscal year ending December 31, 2024, a decrease from the previous year's net income of $5,147,347. The decline in profitability was attributed to a significant reduction in other income, which fell from $9,712,476 in 2023 to $2,840,832 in 2024. This decrease was primarily due to lower interest income from the Trust Account, which dropped from $8,128,147 to $2,409,077, alongside a reduction in gains from warrant liabilities.

The company has undergone several strategic changes during the reporting period, including multiple extensions of the deadline to complete its initial business combination. Shareholders approved an extension from May 15, 2023, to May 15, 2024, and subsequently to November 15, 2025, allowing the company additional time to identify and finalize a merger or acquisition. In connection with these extensions, significant redemptions occurred, with shareholders redeeming 9,985,568 Class A ordinary shares for approximately $104.9 million in May 2023 and 8,236,760 shares for about $90.5 million in December 2023.

Operationally, the company has seen a reduction in its cash reserves, with only $43,499 available outside the Trust Account as of December 31, 2024, and a working capital deficit of $2,341,218. The Trust Account held $3,954,190, which is earmarked for the completion of a business combination. The company has also made significant changes to its management team, with new appointments following the closing of a Securities Purchase Agreement on November 6, 2023, which included the resignation of several directors and the appointment of new leadership.

Looking ahead, the company faces substantial uncertainty regarding its ability to complete a business combination by the extended deadline. If it fails to do so, it will cease operations and liquidate, returning funds to shareholders. The management has acknowledged that there is substantial doubt about the company's ability to continue as a going concern, primarily due to its liquidity challenges and the need for additional capital to fund operations until a business combination is completed. The company is actively seeking opportunities in the critical minerals sector, which it believes will benefit from the global energy transition, but it remains to be seen whether it can successfully execute its strategy within the required timeframe.