Annual Report
2023
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3
CONTENTS PAGE HERE
Chairman’s Letter to Shareholders
4
Corporate Directory
8
Corporate Governance
8
Financial Statements
9
Directors’ Report
10
Declaration of Independence
20
Statement of Profit or Loss
22
and Other Comprehensive Income
Statement of Financial Position
23
24
25
Notes to the Financial Statements
26
Directors’ Declaration
48
Independent Auditor’s Report
49
Shareholder Information
52
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Chairman’s Letter
to Shareholders
Dear Shareholders,
We concluded the 2023 Financial Year
on track to commercialise our products
and contribute to sustainable global
emissions reduction.
The significance of renewable energy
and renewable energy solutions has
been magnified, particularly following
the COP27 climate summit held in
November 2022. With this has come
growing awareness of energy storage to
de-risk the intermittency of renewable
electricity supply.
Our Company is one of the few
technology companies working to
abate the hard-to-decarbonise crucial
manufacturing processes - aluminium,
cement, and iron and steel production.
We have a distinctive product tailored
for a market with major growth outlook,
achievable goals to lower costs,
commercial clarity, an increasingly
supportive legislative environment, and
a business model designed for success.
Our target market, the multi-trillion-
dollar heat economy, is increasingly
incentivised by various forms of carbon
taxes or penalties. SiBox® can be
retrofitted into major industries to lower
their compliance costs whilst producing
“greener” products.
With support from Woodside Energy
Technologies and the Australian
Government we have developed
a unique heat storage technology
applicable to industries worldwide.
Our technology produces a controlled
stream of very hot air using standard
processing equipment, ducting and
fans. Heat is a still a relatively new
market for energy storage, but we
have the most commercially advanced
technology for high-temperature
industries to reduce emissions.
Our business model involves
using existing refractory plants to
manufacture SiBrick™ and licensing
SiBox to engineering companies that
build and service industrial plants.
Industries that retrofit our silicon based
technology into existing production
lines can reduce their reliance on
fossil fuels and immediately reduce
emissions, avoid significant disruption,
minimise capital risk, and retain gas
burning as an adjunct or backup. This
approach not only reduces costs but
also mitigates risks for industrial users,
a crucial incentive.
Our competitive advantage lies in our
ability to harness the properties - very
high energy density and temperatures -
of molten silicon and contain it in brick
form, facilitating scalability and mass
production. This translates into minimal
capital requirements for expanding
production, allowing us to generate
recurring revenues while continuously
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5
researching and developing even better,
more cost-effective products.
We are on a growth trajectory with
our core mission centered on the
development and commercialisation
of our SiBox technology. The SiBox
Demonstration Model (SDM) was
successfully commissioned and is now
proving its performance in long-term
operation. The performance data from
the SDM will be used by our engineers
to inform the design a commercial-
scale SiBox. Woodside has the option
to fund the next stage in exchange for
equity in the SiBox intellectual property.
Furthermore, our partnership with
global refractory manufacturer
Refratechnik-Steel GmbH is preparing
for an automated manufacturing trial of
600 SiBricks, assessing the feasibility
of mass production. We anticipate
future SiBox models employing up to
100,000 SiBricks per GWh unit, thereby
underpinning our commercialisation
strategy with lower unit production
costs.
A generator performance study for the
Aurora Energy Project (Aurora) grid
scale battery (BESS) is complete. This
project remains the Company’s near-
term prospect for revenue generation.
The study report will be submitted for
connection approval when access to the
transmission line has been secured.
During the year, we restructured our
Board, welcoming two independent,
non-executive Directors, Graham
Dooley and Randolph Bowen. Both
bring extensive experience in executive
management and board roles, and
a track record in driving growth and
realising value from assets. Their
appointments followed the resignations
of non-executive Chairman Tony Sacre
and non-executive Directors Pater Gan,
Dana Larson, and Alison Evans.
I acknowledge that we would all like
to see our share price higher in the
short term. Nevertheless, we remain
confident that our strategy is sound
and that in good time our technology,
projects, and achievements to date will
be recognised by the market and deliver
the benefits that shareholders seek.
Finally, thank you for your ongoing
support in this pivotal year. Our
technology comes at a critical time in
the global energy transition journey,
making this an exciting stage for
industry and our shareholders.
I look forward to sharing more
substantial results in the coming year,
2023-24.
Dr Kevin Moriarty
Executive Chairman
the Future
of Clean Heat
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DIRECTORS
Kevin Moriarty - Executive Chairman
Graham Dooley - Non-executive
Director
Randolph Bowen - Non-executive
Director
COMPANY SECRETARY
Katelyn Adams
REGISTERED OFFICE & PRINCIPAL
PLACE OF BUSINESS
1414 Degrees Limited
136 Daws Road
Melrose Park SA 5039
T + 61 8357 8273
E info@1414degrees.com.au
AUDITOR
BDO Audit Pty Ltd
Level 7, 420 King William Street
Adelaide SA 5000
SOLICITORS
Thomson Geer
23/525 Collins Street
Melbourne VIC 3004
PATENT & TRADE MARK ATTORNEYS
Madderns
Level 4, 19 Gouger Street
Adelaide SA 5000
ACCOUNTANTS
HLB Mann Judd
169 Fullarton Road
Dulwich SA 5000
STOCK EXCHANGE LISTING
1414 Degrees Ltd shares are quoted
on the Australian Securities Exchange
(ASX: 14D)
WEBSITE
1414degrees.com.au
CORPORATE GOVERNANCE
STATEMENT
1414 Degrees Limited and the Board
are committed to achieving and
demonstrating the highest standards of
corporate governance.
The Company has reviewed its
corporate governance practices against
the Corporate Governance Principles
and Recommendations (4th edition)
published by the ASX Corporate
Governance Council.
The 2023 Corporate Governance
Statement is dated as at 30 June 2023
and reflects the corporate governance
practices in place throughout the 2023
year.
The 2023 Corporate Governance
Statement has been approved by the
Board.
A description of the Company’s current
corporate governance practices is
set out in the Corporate Governance
Statement which can be viewed at
1414degrees.com.au
Corporate Directory
Corporate Governance
Financial
Statements
10
The Directors present their report,
together with the financial statements,
on the Company for the year ended 30
June 2023.
DIRECTORS
The following persons were Directors of
the Company during the whole of the
financial year and up to the date of this
report, unless otherwise stated:
Kevin Moriarty Executive Chairman
Re-elected 28 July 2022
Graham Dooley Non-Executive Director
Appointed 3 November 2022
Randolph Bowen Non-Executive Director
Appointed 3 November 2022
Alison Evans Non-Executive Director
Resigned 3 November 2022
Dana Larson Non-Executive Director
Resigned 3 November 2022
Peter Gan Non-Executive Director
Resigned 3 November 2022
Tony Sacre Non-Executive Director
Resigned 3 November 2022
Sheree Ford Non-Executive Director
Resigned 15 September 2022
COMPANY SECRETARY
The following persons were Company
Secretary of the Company during the
whole of the financial year and up to the
date of this report, unless otherwise
stated:
Katelyn Adams
Appointed 15 November 2022
Larry Mitchel
Appointed 8 November 2022
Resigned 15 November 2022
Tania Sargent
Resigned 3 November 2022
PRINCIPAL ACTIVITIES
The principal activity of the Company
is developing and commercialising its
silicon-based thermal energy storage
technology SiBox® to provide clean
industrial heat. It is envisaged that the
SiBox modular development concept will
provide a decarbonisation pathway for
energy users such as high temperature
industrial customers, minerals producing
industries, thermal power stations and
those needing a combined heat and
power solution.
The Company is also developing the
Aurora Energy Project. The focus of the
project is to develop a hybrid renewable
energy project delivering reliable
electricity to the Upper Spencer Gulf
region and National Electricity Market.
The Aurora site is also an opportunity to
build and demonstrate a large-scale pilot
of the SiBox technology.
DIVIDENDS
There were no dividends paid,
recommended or declared during the
current or previous financial year.
REVIEW OF OPERATIONS
The Company has continued its focus on
the development of the SiBox thermal
energy storage technology and the
SiBrick™ latent heat storage media.
Notably it has achieved key milestones in
its arrangement with Woodside Energy
Technologies. In addition, the Aurora
Energy Project has moved towards
commercial milestones during the year.
The Company’s innovative technology
will be used to electrify high temperature
process industries, reducing emissions
and tapping into a major clean energy
market opportunity identified through
our membership of the global Long
Duration Energy Storage Council. While
traditional batteries use chemical
changes to store and regenerate
electricity, 1414 Degrees recently
commissioned SiBox functions as a heat
battery, using a phase change of silicon
in SiBrick to store electrical energy and
provide heat on demand. This has the
potential to be a gamechanger for hard-
to-decarbonise industrial processes.
The Directors have decided on a business
strategy to develop products that can be
manufactured under license in existing
industries, a strategy that requires
minimal capital investment by the
Company to achieve growth.
The Directors are focused on accelerating
the development of the Company’s
products for commercialisation. We see
substantial growth potential in the new
and very large industrial heat markets,
particularly for our SiBox heat battery
which is being developed with an aim to
provide consistent, high-temperature air
as an alternative to burning fossil fuels.
SiBox thermal energy storage
technology/SiBrick Technical
Development
This year has been pivotal for the
development and commercialisation of
the Company’s key technologies: SiBox®
and SiBrick™.
The SiBox latent heat battery is
producing very encouraging results after
four years of intensive development and
is attracting growing interest from high-
temperature industrial heat users. There
are few competing technologies in the
industrial heat market, and they are still
in their early stages. Hydrogen burning
is a potential competitor for producing
clean industrial heat, but it costs more
than SiBox, which makes it a less viable
substitute for fossil fuels. Indeed, SiBox
could contribute towards reducing
the cost and emissions of hydrogen
production.
The commissioning trials of the SiBox
Demonstration Model (SDM) have
been successfully concluded and we
have started long-term operational
testing. The SDM comprises a modular
Director’s Report
11
Director’s Report
arrangement of SiBricks optimised for
energy storage capacity and effective
heat transfer. The bricks are heated by
an electrical heating system and their
stored energy is recovered in a stream
of clean air to provide heat on demand.
The energy recovery system of the SDM
simulates a commercial application
process e.g. a gas burner in an alumina
calciner. Our current choice of silicon
phase-change material (PCM) allows
SiBox to supply constant temperature
clean air up to 1000°C, meeting the
temperature requirements of most
industries.
The SDM commissioning process
included extensive trials to demonstrate
SiBox operational activities, optimise
control setpoints, generate initial
results for analysis, and identify key
parameters to inform future tests.
The SiBox technology has performed
to expectations, with analysis and
comparison of the results ongoing.
In May 2023, we announced that the
commissioning trials had successfully
demonstrated the ability of SiBox to
deliver sustained clean heat for 6-12
hours at temperatures of 700°C to
850°C . Data from the trials closely
aligned with the engineering design
tools and models developed, providing
confidence for scale-up designs of
SiBox technology. The 1MWh of internal
SiBrick energy storage media performed
robustly and were in excellent condition
upon visual inspection.
Long-term operational testing of SiBox
is underway, simulating a variety of
process conditions to validate both
the SiBox system performance and the
SiBrick material. The key assessments
include temperature distribution, heat
transfer mechanics and fluid dynamics
for outlet temperature control. Our
engineers will use performance results
from the SDM to design a commercial-
scale SiBox. In May 2023 the Company
announced the name “SiBrick” for the
ground-breaking silicon storage media
previously referred to as the 14D brick.
The Company has lodged a trademark
application for SiBrick. The SiBrick
technology is being developed for
mass production in existing refractory
brick plants through our partnership
agreement with Refratechnik-Steel
Gmbh (Refratechnik), which eliminates
the need to build new production
facilities and makes it possible to
manufacture larger storage capacities.
As announced, Refratechnik will be
our technology partner for a mass
production trial of up to 600 bricks. We
envisage future SiBox models using up
to 100,000 SiBricks in a 1GWh facility,
underpinning our commercialisation
strategy with lower unit production
costs.
Aurora Energy project
The Aurora Energy Project (Aurora)
joint venture is currently progressing
the development of a large grid scale
battery energy storage system (BESS)
to final Investment decision (FID). The
generator performance study (GPS) for
the 140MW BESS is complete and this
project continues to be our near-term
prospect for revenue. The National
Electricity Market (NEM) offers multiple
revenue opportunities to service
capacity and stability requirements. A
large lithium-ion battery system, as is
proposed for the Aurora project, has
been modelled to earn substantial net
revenues charging and discharging
on the network. Battery operational
revenue streams are highly variable,
however the Australian government
has created a means to mitigate
short term revenue risk through its
Capacity Investment Scheme. Due to
its location on a 275 kV transmission
line, the Aurora project is well situated
to make an important contribution to
the stability of the NEM and provide
cash flow for 1414 Degrees. The GPS
study report will be submitted for
connection approval when access to the
transmission line has been secured. The
project is progressing well, however its
timeline depends on external factors.
Intellectual property
The Company continues to actively
manage, document and protect all its
intellectual property.
Current status of patents:
—
Patent 2010282232 - “Thermal
Energy Storage Apparatus,
Arrangement and Method”. Granted
AU, NZL, EU, China and US.
—
PCT Application 2018239960
“Energy Storage and Retrieval
System” (TESS_IND). Granted in US,
in progress in AU, NZL and EU.
—
Australian provisional patent
application No. 2020904050
(SiBox Storage Media). In
application/patent pending.
Registered trademarks:
—
1414 Degrees (Logo) registered in
AU
—
Clean Scalable Energy Storage
(Logo), registered in AU
—
SiBox registered in AU, UK, PRC,
USA, EU
—
SiBrick trademark application in AU
Risks specific to the Company
Some key risks of the Company are
detailed below. The list of risks is not
exhaustive.
—
Commercialisation of technology
risk - The Company will need
to design a commercial
demonstration pilot in order to
effect the second stage of its
business plan and meet some
contractual milestones. Delays
or failure to identify or secure a
site would significantly disrupt
the business plan. Achieving its
goals requires the Company to
expand its in-house technical and
marketing expertise to build and
maintain business growth and
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attract funding, and there is a risk
that growth is disrupted if this
expansion is delayed.
—
Competition and Intellectual
Property risk - 1414 Degrees
participates in a new high
temperature thermal energy
storage market. There are currently
no commercial technologies with
the attributes of the 1414 Degrees
products in its potential markets.
In the future, development of other
technologies for these markets
or the Company’s inability to
enforce and defend its Intellectual
Property against third party
challengers could have a material
adverse impact on 1414 Degrees
performance and prospects of the
business.
—
Core technology performance risk
- For over 15 years the Company
has developed and continues to
develop its core silicon-based
thermal storage media however
the products have not been tested
in long-term operation. There is a
risk that the storage media does
not meet the expectation of a
20-year operating lifetime, and
this could delay or prevent the
commercialisation of its SiBox
technology, with significant adverse
effects on investment in the
Company.
—
Commercial risks relating to
Aurora Project - The Company
has invested in development of a
battery energy storage project as
part of the Aurora project, relying
upon independent positive net
revenue projections from operating
in the national electricity market.
Realisation of a commercial return
on this investment requires the
Company to obtain access to
private electricity transmission
lines and the conversion of the
status of those lines to participate
in the national electricity market.
There is a risk that it will not obtain
access to transmission, or that cost
of access could make the project
unprofitable. The Company’s
joint-venture partner in the Aurora
project must pay the Company
$1.5 million when connection to
the transmission lines is approved.
There is a risk that this payment
will not occur if connection is not
achieved.
—
Operating experience and reliance
on key personnel risk - The
Company relies on the experience
of its management team and
Directors. The loss of the services
of certain personnel could have an
adverse effect on the Company and
its activities, including delays in
realising the commercial potential
of the technology.
—
Business strategy execution -
The Company’s future growth,
profitability and cash flows depend
on the ability of its management to
successfully execute its business
strategy. There can be no assurance
that 1414 Degrees can successfully
achieve its business objectives and
this could have a material adverse
effect on the Company’s business,
financial condition, and operations.
SIGNIFICANT CHANGES IN THE STATE
OF AFFAIRS
During the year ended 30 June 2023
the senior management team of the
Company was restructured. The Board
welcomed two independent, non-
executive Directors Graham Dooley and
Randolph Bowen. The appointments
followed the resignation of non-
executive Chairman Tony Sacre and
non-executive Directors Pater Gan,
Dana Larson, and Alison Evans.
The COO of the Company Jordan
Parham resigned during the year. Dr
Kevin Moriarty was appointed executive
chairman and Dr Mahesh Venkataraman
promoted to the new position of chief
technology officer (CTO).
There were no other significant changes
in the state of affairs of the Company
during the financial year.
MATTERS SUBSEQUENT TO THE END
OF THE FINANCIAL YEAR
On 14 July 2023 the Company
announced a non-renounceable
pro-rata offer of new fully paid shares
(Entitlement Offer). The Entitlement
Offer closed on 14 August 2023 and
was strongly supported by existing
shareholders. The Company received
total applications from Eligible
Shareholders of approximately $1,471
million (equal to 32,683,063 fully paid
shares).
In accordance with the terms and
conditions set out in the prospectus
dated 14 July 2023, one free attaching
option exercisable at $0.10 each on or
before the day that is 24 months after
the date of issue will be issued for each
new fully paid share applied for and
issued under the entitlement offer.
No other matter or circumstance
has arisen since 30 June 2023 that
has significantly affected, or may
significantly affect the Company’s
operations, the results of those
operations, or the Company’s state of
affairs in future financial years.
LIKELY DEVELOPMENTS AND
EXPECTED RESULTS OF OPERATIONS
Information on likely developments in
the operations of the Company and the
expected results of operations have not
been included in this report because the
Directors believe it would be likely to
result in unreasonable prejudice to the
Company.
ENVIRONMENTAL REGULATION
The Company is not subject to any
significant environmental regulation
under Australian Commonwealth or
State law.
Director’s Report
13
DR KEVIN MORIARTY
Title
Executive Chairman
Qualifications
BSc (Hons), Ph.D., MAusIMM
Experience and expertise
Dr Kevin Charles Moriarty, BSc (Hons),
Ph.D., MAusIMM has 35 years corporate
experience in roles including
Chairman and Managing Director of
listed companies. He founded and
led several companies to develop
mines in Australia and Africa. He was
Executive Chairman of 1414 Degrees
Ltd for 5 years until retiring in 2021.
During his term, 1414 Degrees built
several prototype devices utilising high
temperature silicon energy storage to
produce electricity. Two charged from
electricity and one by burning biogas.
They did not perform to specification
and Dr Moriarty brought in more
highly qualified technical team with
material science background as well
as engineering. This team developed
the new SiBox technology aimed
at very efficient energy storage and
recovery at high temperatures to
replace gas burning in industry. This
attracted major support from Woodside
Energy Ltd and the Commonwealth
government. In 2019 he negotiated the
purchase of the Aurora Solar project for
1414 Degrees. He was re- elected to the
board of 1414 Degrees and re-appointed
executive chairman in 2022.
Other current directorships
None
Former directorships (last 3 years)
None
Interests in shares
16,237,916 ordinary shares
Interests in options
3,322,222 options
GRAHAM DOOLEY
Title
Non-Executive Director
Qualifications
BSc, BE (Hons), MPA, FAICD, FIEAust
Experience and expertise
Graham is an accomplished Non-
Executive Director, Managing Director
and Chairman
with extensive infrastructure and
investment experience. As well as
serving as a Director of the businesses
below, Graham is also a Senior Advisor
to Igneo Infrastructure Partners, one
of the top 10 infrastructure investors
world-wide; and a Senior Advisor to a
Local Government Council in South
Australia.
Graham established and was the
Managing Director of United Utilities
Australia (now Trility) from 1991-2007.
Following this, he founded and held an
Executive Chairman role with the Water
Utilities Australia Group of companies
and its sister company that invested
in agricultural water entitlements.
He is a past National President of the
Australian Water Association, a Fellow
of the Australian Institute of Company
Directors and a Fellow of the Institution
of Engineers, Australia.
Other current directorships
None
Former directorships (last 3 years)
None
Interests in shares
257,846 ordinary shares
Interests in options
85,949 options
RANDOLPH BOWEN
Title
Non-Executive Director
Qualifications
BAppSc (Oen), GAICD
Experience and expertise
Randolph is a management
executive with strong domestic and
international profit and loss and
operational management experience.
Randolph successfully established a
fully integrated global supply chain
for Fosters Wine Group resulting
in significant improvement in the
planning, production, delivery and
customer service systems at reduced
cost to the business. He has a talent for
making rapid assessments of challenges
and then developing and leading the
resulting action plan.
Key areas of expertise include:
—
Strategic/operational planning,
forecasting, budgeting and cost
control
—
Infrastructure design and
production maximisation
—
Quality and productivity
improvement
—
Business integration
—
Team building and organisational
change management
—
Leader in Occupational Health,
Safety & Environmental (OHSE)
practices and culture
Other current directorships
None
Former directorships (last 3 years)
None
Interests in shares
3,000,000 ordinary shares
Interests in options
1,000,000 options
'Other current directorships' quoted above are current directorships for listed entities only and excludes directorships of all other types of entities, unless otherwise
stated.
'Former directorships (last 3 years)' quoted above are directorships held in the last 3 years for listed entities only and excludes directorships of all other types of
entities, unless otherwise stated.
Director’s Report — Information on Directors
14
COMPANY SECRETARY
Katelyn Adams has over 15 years of
accounting and board experience,
servicing predominantly ASX listed
companies. Katelyn is a Chartered
Accountant and Partner of the
Corporate Advisory division of HLB
Mann Judd in Adelaide, as well as the
Company Secretary of various listed and
private companies and a Non-executive
Director of Clean Seas Seafood Ltd.
Katelyn has extensive knowledge in
corporate governance, ASX Listing Rule
requirements, IPO and capital raising
processes, as well as a strong technical
accounting background.
MEETINGS OF DIRECTORS
The number of meetings of the
Company’s Board of Directors (‘the
Board’) held during the year ended 30
June 2023, and the number of meetings
attended by each Director were:
Full Board
Attended/Held
Kevin Moriarty
8/8
Graham Dooley
4/4
Randolph Bowen
4/4
Alison Evans
4/4
Dana Larson
4/4
Peter Gan
4/4
Tony Sacre
4/4
Sheree Ford
2/2
Held: represents the number of
meetings held during the time the
Director held office.
REMUNERATION REPORT (AUDITED)
The remuneration report details the key
management personnel remuneration
arrangements for the Company, in
accordance with the requirements
of the Corporations Act 2001 and its
Regulations.
Key management personnel are
those persons having authority and
responsibility for planning, directing
and controlling the activities of the
entity, directly or indirectly, including all
Directors.
The remuneration report is set out
under the following main headings:
—
Principles used to determine
the nature and amount of
remuneration
—
Details of remuneration
—
Service agreements
—
Share-based compensation
—
Additional disclosures relating to
key management personnel
PRINCIPLES USED TO DETERMINE
THE NATURE AND AMOUNT OF
REMUNERATION
The objective of the Company’s
executive reward framework is to
ensure reward for performance is
competitive and appropriate for the
results delivered. The framework aligns
executive reward with the achievement
of strategic objectives and the creation
of value for shareholders, and it is
considered to conform to the market
best practice for the delivery of reward.
The Board of Directors (‘the Board’)
ensures that executive reward satisfies
the following key criteria for good
reward governance practices:
—
competitiveness and
reasonableness
—
acceptability to shareholders
—
performance linkage / alignment of
executive compensation
—
transparency
The Board is responsible for
determining and reviewing
remuneration arrangements for
its directors and executives. The
performance of the Company
depends on the quality of its directors
and executives. The remuneration
philosophy is to attract, motivate and
retain high performance and high
quality personnel.
The board has structured an executive
remuneration framework that is market
competitive and complementary to the
reward strategy of the Company, with an
appropriate level of fixed remuneration
for key management personnel, as well
as a proportion of performance based
remuneration.
The reward framework is designed
to align executive reward and their
performance hurdles to the targets of
the Company as well as shareholders’
interests. In considering shareholder
wealth, the Board considers that
this is generally driven by successful
commercialisation and long-term
proposition, rather than being directly
linked to financial performance. The
Board also considers the Enterprise
Value of the Company, being the market
capitalisation at the end of each period
end, adjusted for cash held at year end.
Additionally, the reward framework
should seek to enhance executives’
interests by:
—
rewarding capability and experience
—
reflecting competitive reward
for contribution to growth in
shareholder wealth
—
providing a clear structure for
earning rewards
In accordance with best practice
corporate governance, the structure of
non-executive Director and executive
Director remuneration is separate.
Non-executive Directors remuneration
Fees and payments to Non-Executive
directors reflect the demands
and responsibilities of their role.
Non-Executive Directors’ fees and
payments are reviewed periodically
by the Board and are regularly
compared with companies with
comparable market capitalisation
and stage of development. Non-
Executive Directors do not receive
share Performance Rights or other
incentives. The Chairman’s fees are
determined independently to the fees
of Non-Executive Directors based
on comparative roles in the external
market.
ASX listing rules require the aggregate
Director’s Report
15
Non-Executive Director’s remuneration
to be determined periodically by a
general meeting. The maximum annual
aggregate remuneration for Non-
Executive Directors has been set at
$300,000.
Executive remuneration
The Company aims to reward
executives based on their position and
responsibility, with a level and mix of
remuneration which has both fixed and
variable components.
The executive remuneration and reward
framework has three components:
—
base pay and non-monetary
benefits
—
share-based payments
—
other remuneration such as
superannuation and long service
leave
The combination of these comprises
the executive’s total remuneration.
Fixed remuneration, consisting
of base salary, superannuation
and non-monetary benefits, are
reviewed annually by the board based
on individual and business unit
performance, the overall performance of
the Company and comparable market
remunerations.
Executives may receive their fixed
remuneration in the form of cash or
other fringe benefits (for example
motor vehicle benefits) where it does
not create any additional costs to the
Company and provides additional value
to the executive.
The Company has a Performance
Rights Plan under which it can issue
Performance Rights to staff and
executives.
Company performance and link to
remuneration
The remuneration of key management
personnel is linked to the development
of the Company’s intangible assets, the
continued progress towards developing
the TESS technology and progress on
the Aurora site at Port Augusta. Various
performance criteria are linked to
Performance Rights granted.
Voting and comments made at the
Company’s 2022 Annual General
Meeting (‘AGM’)
At the 11 November 2022 AGM, 87%
of the votes received supported the
adoption of the remuneration report
for the year ended 2022. The Company
did not receive any specific feedback
at the AGM regarding its remuneration
practices.
Director’s Report
1414 Degrees Ltd
Directors' report
30 June 2023
16
Details of remuneration
Amounts of remuneration
Details of the remuneration of key management personnel of the Company are set out in the following tables.
Short-term benefits
Post-
employment
benefits
Long-term
benefits
Share-based payments
Cash salary
and fees
Cash
bonus
Non-
monetary
Super-
annuation
Long
service
leave
Equity-
settled
shares
Equity-
settled
performanc
e rights
Total
30 June 2023
$
$
$
$
$
$
$
$
Non-Executive
Directors:
Graham Dooley *
Randolph Bowen
*
33,056
33,333
-
-
-
-
-
-
-
-
-
-
-
-
33,056
33,333
Alison Evans **
19,583
-
-
-
-
-
-
19,583
Dana Larson **
15,410
-
-
-
-
-
-
15,410
Peter Gan **
15,417
-
-
-
-
-
-
15,417
Tony Sacre **
23,750
-
-
-
-
-
-
23,750
Sheree Ford ***
8,333
-
-
-
-
-
-
8,333
Executive
chairman:
Kevin Moriarty
81,250
-
-
7,350
-
-
-
88,600
Other Key
Management
Personnel:
Jordan Parham
126,854
-
-
10,899
-
-
-
137,753
356,986
-
-
18,249
-
-
-
375,235
*
Represents remuneration from 1 November 2022 to 30 June 2023
**
Represents remuneration from 1 July 2022 to 31 October 2022
***
Represents remuneration from 1 July 2022 to 15 September 2022
1414 Degrees Ltd
Directors' report
30 June 2023
17
Short-term benefits
Post-
employment
benefits
Long-term
benefits
Share-based payments
Cash salary
and fees
Cash
bonus
Non-
monetary
Super-
annuation
Long
service
leave
Equity-
settled
shares
Equity-
settled
performanc
e rights
Total
30 June 2022
$
$
$
$
$
$
$
$
Non-Executive
Directors:
Alison Evans*
8,333
-
-
-
-
-
-
8,333
Dana Larson
41,667
-
-
-
-
-
-
41,667
Peter Gan
41,667
-
-
-
-
-
-
41,667
Tony Sacre
66,667
-
-
-
-
-
-
66,667
Sheree Ford**
8,333
-
-
-
-
-
-
8,333
Executive
Directors:
Kevin Moriarty***
89,315
-
-
5,144
-
-
-
94,459
Other Key
Management
Personnel:
Matthew Squire
321,246
-
-
23,509
-
-
25,800
370,555
Jordan Parham
223,167
-
-
21,755
7,165
5,500
44,000
301,587
800,395
-
-
50,408
7,165
5,500
69,800
933,268
*
Represents remuneration from 1 May 2022 to 30 June 2022
**
Represents remuneration from 1 July 2021 to 2 September 2021
***
Represents remuneration from 1 August 2021 to 30 June 2022
Service agreements
Remuneration and other terms of employment for key management personnel are formalised in service agreements. Details
of these agreements are as follows:
Name:
Kevin Moriarty
Title:
Executive Chairman
Agreement commenced:
28 July 2022
Term of agreement:
Fixed term | termination 30 November 2023
Details:
The initial agreement was for an annual salary of $45,000 effective 1 August 2022.
Effective 30 November 2022 the annual salary was updated to $120,000 per annum.
Effective 1 August 2023 the annual salary was updated to $200,000 per annum.
Name:
Graham Dooley
Title:
Non-Executive Director
Agreement commenced:
3 November 2022
Term of agreement:
Ongoing
Details:
Annual fee effective 3 November 2022 of $50,000
Name:
Randolph Bowen
Title:
Non-Executive Director
Agreement commenced:
3 November 2022
Term of agreement:
Ongoing
Details:
Annual fee effective 3 November 2022 of $50,000
Key management personnel have no entitlement to termination payments in the event of removal for misconduct.
1414 Degrees Ltd
Directors' report
30 June 2023
18
Share-based compensation
Issue of shares
There were no shares issued to Directors and other key management personnel as part of compensation during the year
ended 30 June 2023.
Options
There were no options over ordinary shares issued to Directors and other key management personnel as part of
compensation that were outstanding as at 30 June 2023.
There were no options over ordinary shares granted to or vested by Directors and other key management personnel as part
of compensation during the year ended 30 June 2023.
Performance rights
There were no Performance Rights granted to or exercised by Directors and other key management personnel as part of
compensation during the year ended 30 June 2023.
Additional disclosures relating to key management personnel
Shareholding
The number of shares in the Company held during the financial year by each Director and other members of key management
personnel of the Company, including their personally related parties, is set out below:
Ordinary shares
Balance at
Received
Balance at
the start of
as part of
Disposals/
the end of
the year
remuneration
Additions
other
the year
Kevin Moriarty
12,915,694
-
-
-
12,915,694
Graham Dooley
-
-
171,897
-
171,897
Randolph Bowen*
2,000,000
-
-
-
2,000,000
14,915,694
-
171,897
- 15,087,591
*
Comprising of 2,000,000 shares held indirectly by Randolph Bowen when he was appointed as Director
Performance Rights
The number of Performance Rights over ordinary shares in the Company held during the financial year by each Director and
other members of key management personnel of the Company, including their personally related parties, is set out below:
Performance Rights over ordinary shares
Balance at
Expired/
Balance at
the start of
forfeited/
the end of
the year
Granted
Exercised
other
the year
Jordan Parham
500,000
-
-
(500,000)
-
500,000
-
-
(500,000)
-
This concludes the remuneration report, which has been audited.
Shares under option
There were no unissued ordinary shares of the Company under option outstanding at the date of this report.
Shares issued on the exercise of options
There were no ordinary shares of the Company issued on the exercise of options during the year ended 30 June 2023 and
up to the date of this report.
Indemnity and insurance of officers
The Company has indemnified the Directors and executives of the Company for costs incurred, in their capacity as a Director
or executive, for which they may be held personally liable, except where there is a lack of good faith.
During the financial year, the Company paid a premium in respect of a contract to insure the Directors and executives of the
Company against a liability to the extent permitted by the Corporations Act 2001. The contract of insurance prohibits
disclosure of the nature of the liability and the amount of the premium.
1414 Degrees Ltd
Directors' report
30 June 2023
19
Indemnity and insurance of auditor
The Company has not, during or since the end of the financial year, indemnified or agreed to indemnify the auditor of the
Company or any related entity against a liability incurred by the auditor.
During the financial year, the Company has not paid a premium in respect of a contract to insure the auditor of the Company
or any related entity.
Proceedings on behalf of the Company
No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings on behalf
of the Company, or to intervene in any proceedings to which the Company is a party for the purpose of taking responsibility
on behalf of the Company for all or part of those proceedings.
Non-audit services
There were no non-audit services provided during the financial year by the auditor.
Officers of the Company who are former partners of BDO Audit Pty Ltd
There are no officers of the Company who are former partners of BDO Audit Pty Ltd.
Auditor's independence declaration
A copy of the auditor's independence declaration as required under section 307C of the Corporations Act 2001 is set out
immediately after this Directors' report.
Auditor
BDO Audit Pty Ltd continues in office in accordance with section 327 of the Corporations Act 2001.
This report is made in accordance with a resolution of Directors, pursuant to section 298(2)(a) of the Corporations Act 2001.
On behalf of the Directors
Kevin Moriarty
Executive Chairman
29 September 2023
BDO Centre
Level 7, 420 King William Street
Adelaide SA 5000
GPO Box 2018 Adelaide SA 5001
Australia
Tel: +61 8 7324 6000
Fax: +61 8 7324 6111
www.bdo.com.au
BDO Audit Pty Ltd ABN 33 134 022 870 is a member of a national association of independent entities which are all members of BDO
Australia Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit Pty Ltd and BDO Australia Ltd are members of
BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member
firms. Liability limited by a scheme approved under Professional Standards Legislation.
DECLARATION OF INDEPENDENCE
BY PAUL GOSNOLD
TO THE DIRECTORS OF 1414 DEGREES LTD
As lead auditor of 1414 Degrees Ltd for the year ended 30 June 2023, I declare that, to the best of my
knowledge and belief, there have been:
1.
No contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit; and
2.
No contraventions of any applicable code of professional conduct in relation to the audit.
Paul Gosnold
Director
BDO Audit Pty Ltd
Adelaide, 29 September 2023
1414 Degrees Ltd
21
General information
The financial statements cover 1414 Degrees Ltd as an individual entity. The financial statements are presented in Australian
dollars, which is 1414 Degrees Ltd's functional and presentation currency.
1414 Degrees Ltd is a listed public company limited by shares, incorporated and domiciled in Australia. Its registered office
and principal place of business is:
136 Daws Road
Melrose Park SA 5039
A description of the nature of the Company's operations and its principal activities are included in the Directors' report, which
is not part of the financial statements.
The financial statements were authorised for issue, in accordance with a resolution of Directors, on 29 September 2023. The
Directors have the power to amend and reissue the financial statements.
1414 Degrees Ltd
22
Statement of profit or loss and other comprehensive income
For the year ended 30 June 2023
Note 30 June 2023
$
30 June 2022
$
Revenue
Disposal of subsidiary
-
3,293,684
Other income
3
115,386
566,612
Total revenue
115,386
3,860,296
Expenses
Administration and professional expenses
(1,226,067)
(1,596,249)
Asset impairment
-
(997,516)
Depreciation and amortisation
(30,200)
(380,879)
Employee benefits expense
(338,035)
(1,063,714)
Finance costs
(1,022)
(276,998)
Provision for Gas-TESS decommissioning (Glenelg project)
16
466,000
(500,000)
Share based payments (equity settled)
31
87,175
(149,121)
Share of loss - SiliconAurora joint venture
(375,488)
-
Other expenses
4
(529,000)
(265,129)
Total expenses
(1,946,637) (5,229,606)
Loss before income tax expense
(1,831,251)
(1,369,310)
Income tax expense
5
-
-
Loss after income tax expense for the year attributable to the owners of 1414
Degrees Ltd
19
(1,831,251)
(1,369,310)
Other comprehensive income for the year, net of tax
-
-
Total comprehensive income for the year attributable to the owners of 1414
Degrees Ltd
(1,831,251)
(1,369,310)
Cents
Cents
Basic earnings per share
30
(0.91)
(0.68)
Diluted earnings per share
30
(0.91)
(0.68)
The above statement of profit or loss and other comprehensive income should be read in conjunction with the
accompanying notes
1414 Degrees Ltd
23
Statement of financial position
As at 30 June 2023
Note 30 June 2023 30
$
June 2022
$
Assets
Current assets
Cash and cash equivalents
6
1,948,457
3,549,416
Trade and other receivables
7
2,484,996
3,442,624
Other
10
172,486
137,021
Total current assets
4,605,939
7,129,061
Non-current assets
Trade and other receivables
7
360,456
64,075
Joint venture investment
8
2,124,512
2,500,000
Property, plant and equipment
11
48,139
60,967
Right-of-use assets
9
226,192
414,705
Intangibles
12
2,362,069
1,822,904
Total non-current assets
5,121,368
4,862,651
Total assets
9,727,307 11,991,712
Liabilities
Current liabilities
Trade and other payables
13
485,546
444,992
Lease liabilities
14
227,357
205,000
Employee benefits
15
124,829
58,577
Provisions
16
34,000
500,000
Total current liabilities
871,732
1,208,569
Non-current liabilities
Lease liabilities
14
-
232,167
Employee benefits
15
21,457
75,238
Total non-current liabilities
21,457
307,405
Total liabilities
893,189
1,515,974
Net assets
8,834,118
10,475,738
Equity
Contributed equity
17
33,002,185
32,656,879
Reserves
18
167,720
323,395
Accumulated losses
19
(24,335,787) (22,504,536)
Total equity
8,834,118
10,475,738
The above statement of financial position should be read in conjunction with the accompanying notes
1414 Degrees Ltd
24
Statement of changes in equity
For the year ended 30 June 2023
Contributed
equity
Reserves
Accumulated
losses
Total equity
$
$
$
$
Balance at 1 July 2021
32,486,429
196,904
(21,154,998)
11,528,335
Loss after income tax expense for the year
-
-
(1,369,310)
(1,369,310)
Other comprehensive income for the year, net of tax
-
-
-
-
Total comprehensive income for the year
-
-
(1,369,310)
(1,369,310)
Transactions with owners in their capacity as owners:
Share-based payments (note 31)
11,000
147,820
19,772
178,592
Employee Share Scheme - Performance Rights Valuation
-
138,121
-
138,121
Employee Share Scheme - Conversion of Performance Rights
159,450
(159,450)
-
-
Balance at 30 June 2022
32,656,879
323,395
(22,504,536)
10,475,738
Contributed
equity
Reserves
Accumulated
losses
Total equity
$
$
$
$
Balance at 1 July 2022
32,656,879
323,395
(22,504,536)
10,475,738
Loss after income tax expense for the year
-
-
(1,831,251)
(1,831,251)
Other comprehensive income for the year, net of tax
-
-
-
-
Total comprehensive income for the year
-
-
(1,831,251)
(1,831,251)
Transactions with owners in their capacity as owners:
Contributions of equity, net of transaction costs (note 17)
276,806
-
-
276,806
Employee Share Scheme - Performance Rights Valuation
-
15,681
-
15,681
Employee Share Scheme - Performance Rights Lapsed
-
(102,856)
-
(102,856)
Employee Share Scheme - Conversion of Performance Rights
68,500
(68,500)
-
-
Balance at 30 June 2023
33,002,185
167,720
(24,335,787)
8,834,118
The above statement of changes in equity should be read in conjunction with the accompanying notes
1414 Degrees Ltd
25
Statement of cash flows
For the year ended 30 June 2023
Note 30 June 2023
$
30 June 2022
$
Cash flows from operating activities
Receipts from customers (inclusive of GST)
30,090
172,334
Payments to suppliers and employees (inclusive of GST)
(2,069,145)
(3,019,385)
Interest received
29,277
19,004
Interest paid on lease liabilities
Ovida payments (partner project contributions)
(1,022)
-
-
390,909
Net cash used in operating activities
29
(2,010,800) (2,437,138)
Cash flows from investing activities
Payments for property, plant and equipment
11
(9,715)
(47,828)
Payments for product development activities
(2,924,637)
(2,259,751)
Partner project contributions
600,000
1,113,025
Research and development tax offset received and used for intangible asset
12
1,271,760
830,107
Government grant received and used for intangible asset
12
847,000
896,000
Proceeds from disposal of investments
900,000
100,000
Loans to SiliconAurora joint venture
(296,381)
-
Net cash from investing activities
388,027
631,553
Cash flows from financing activities
Proceeds from issue of shares
17
276,806
-
Repayment of lease liabilities
(254,992)
(350,000)
Net cash from/(used in) financing activities
21,814
(350,000)
Net decrease in cash and cash equivalents
(1,600,959)
(2,155,585)
Cash and cash equivalents at the beginning of the financial year
3,549,416
5,704,957
Effects of exchange rate changes on cash and cash equivalents
-
44
Cash and cash equivalents at the end of the financial year
6
1,948,457
3,549,416
The above statement of cash flows should be read in conjunction with the accompanying notes
1414 Degrees Ltd
Notes to the financial statements
30 June 2023
26
Note 1. Significant accounting policies
The principal accounting policies adopted in the preparation of the financial statements are set out either in the respective
notes or below. These policies have been consistently applied to all the years presented, unless otherwise stated.
Going concern
The financial report has been prepared on the basis of a going concern. The financial report shows the Company incurred a
net loss of $1,831,251 and a net cash outflow from activities of $1,600,959 during the reporting period. The Company's ability
to continue as a going concern is contingent upon generation of cash inflow from its business and/or successfully raising
additional capital. The circumstances represent a material uncertainty that may cast significant doubt about the Company's
ability to continue as a going concern and therefore the Company may be unable to realise its assets and discharge its
liabilities in the normal course of business. No allowance for such circumstances has been made in the financial report.
Principles of consolidation
The financial statement's comparative period ended 30 June 2021 was prepared on a consolidated basis. The principles of
consolidation are as follows:
Subsidiaries are all entities (including structured entities) over which the group had control. The group controls an entity
where the group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to
affect those returns through its power to direct the activities of the entity. Subsidiaries are fully consolidated from the date of
which control is transferred to the group. They are deconsolidated from the date that control ceases.
The acquisition method of accounting is used to account for business combinations by the group.
Inter-company transactions, balances and unrealised gains on transactions between group companies are eliminated.
Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the transferred asset.
Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by
the group.
Non-controlling interests in the results and equity of subsidiaries are show separately in the consolidated statement of profit
or loss, statement of comprehensive income, statement of changes in equity and balance sheet respectively.
New or amended Accounting Standards and Interpretations adopted
The Company has adopted all of the new or amended Accounting Standards and Interpretations issued by the Australian
Accounting Standards Board ('AASB') that are mandatory for the current reporting period.
Any new or amended Accounting Standards or Interpretations that are not yet mandatory have not been early adopted.
Basis of preparation
These general purpose financial statements have been prepared in accordance with Australian Accounting Standards and
Interpretations issued by the Australian Accounting Standards Board ('AASB') and the Corporations Act 2001, as appropriate
for for-profit oriented entities. These financial statements also comply with International Financial Reporting Standards as
issued by the International Accounting Standards Board ('IASB').
Historical cost convention
The financial statements have been prepared under the historical cost convention.
Critical accounting estimates
The preparation of the financial statements requires the use of certain critical accounting estimates. It also requires
management to exercise its judgement in the process of applying the Company's accounting policies. The areas involving a
higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial
statements, are disclosed in note 2.
1414 Degrees Ltd
Notes to the financial statements
30 June 2023
Note 1. Significant accounting policies (continued)
27
Revenue recognition
The Company recognises revenue as follows:
Revenue from contracts with customers
Revenue is recognised at an amount that reflects the consideration to which the Company is expected to be entitled in
exchange for transferring goods or services to a customer. For each contract with a customer, the Company: identifies the
contract with a customer; identifies the performance obligations in the contract; determines the transaction price which takes
into account estimates of variable consideration and the time value of money; allocates the transaction price to the separate
performance obligations on the basis of the relative stand-alone selling price of each distinct good or service to be delivered;
and recognises revenue when or as each performance obligation is satisfied in a manner that depicts the transfer to the
customer of the goods or services promised.
Variable consideration within the transaction price, if any, reflects concessions provided to the customer such as discounts,
rebates and refunds, any potential bonuses receivable from the customer and any other contingent events. Such estimates
are determined using either the 'expected value' or 'most likely amount' method. The measurement of variable consideration
is subject to a constraining principle whereby revenue will only be recognised to the extent that it is highly probable that a
significant reversal in the amount of cumulative revenue recognised will not occur. The measurement constraint continues
until the uncertainty associated with the variable consideration is subsequently resolved. Amounts received that are subject
to the constraining principle are recognised as a refund liability.
Sale of goods
Revenue from the sale of goods is recognised at the point in time when the customer obtains control of the goods, which is
generally at the time of delivery.
Rendering of services
Revenue from a contract to provide services is recognised over time as the services are rendered based on either a fixed
price or an hourly rate.
Interest
Interest revenue is recognised as interest accrues using the effective interest method. This is a method of calculating the
amortised cost of a financial asset and allocating the interest income over the relevant period using the effective interest rate,
which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to the
net carrying amount of the financial asset.
Other revenue
Other revenue is recognised when it is received or when the right to receive payment is established.
Income tax
The income tax expense or benefit for the period is the tax payable on that period's taxable income based on the applicable
income tax rate for each jurisdiction, adjusted by the changes in deferred tax assets and liabilities attributable to temporary
differences, unused tax losses and the adjustment recognised for prior periods, where applicable.
Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected to be applied when the
assets are recovered or liabilities are settled, based on those tax rates that are enacted or substantively enacted, except for:
●
When the deferred income tax asset or liability arises from the initial recognition of goodwill or an asset or liability in a
transaction that is not a business combination and that, at the time of the transaction, affects neither the accounting nor
taxable profits; or
●
When the taxable temporary difference is associated with interests in subsidiaries, associates or joint ventures, and the
timing of the reversal can be controlled and it is probable that the temporary difference will not reverse in the foreseeable
future.
Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that
future taxable amounts will be available to utilise those temporary differences and losses.
The carrying amount of recognised and unrecognised deferred tax assets are reviewed at each reporting date. Deferred tax
assets recognised are reduced to the extent that it is no longer probable that future taxable profits will be available for the
carrying amount to be recovered. Previously unrecognised deferred tax assets are recognised to the extent that it is probable
that there are future taxable profits available to recover the asset.
1414 Degrees Ltd
Notes to the financial statements
30 June 2023
28
Note 1. Significant accounting policies (continued)
Deferred tax assets and liabilities are offset only where there is a legally enforceable right to offset current tax assets against
current tax liabilities and deferred tax assets against deferred tax liabilities; and they relate to the same taxable authority on
either the same taxable entity or different taxable entities which intend to settle simultaneously.
Current and non-current classification
Assets and liabilities are presented in the statement of financial position based on current and non-current classification.
An asset is classified as current when: it is either expected to be realised or intended to be sold or consumed in the Company's
normal operating cycle; it is held primarily for the purpose of trading; it is expected to be realised within 12 months after the
reporting period; or the asset is cash or cash equivalent unless restricted from being exchanged or used to settle a liability
for at least 12 months after the reporting period. All other assets are classified as non-current.
A liability is classified as current when: it is either expected to be settled in the Company's normal operating cycle; it is held
primarily for the purpose of trading; it is due to be settled within 12 months after the reporting period; or there is no
unconditional right to defer the settlement of the liability for at least 12 months after the reporting period. All other liabilities
are classified as non-current.
Deferred tax assets and liabilities are always classified as non-current.
Joint ventures
A joint venture is a joint arrangement whereby the parties that have joint control of the arrangement have rights to the net
assets of the arrangement. Investments in joint ventures are accounted for using the equity method. Under the equity method,
the share of the profits or losses of the joint venture is recognised in profit or loss and the share of the movements in equity
is recognised in other comprehensive income. Investments in joint ventures are carried in the statement of financial position
at cost plus post-acquisition changes in the Company's share of net assets of the joint venture. Goodwill relating to the joint
venture is included in the carrying amount of the investment and is neither amortised nor individually tested for impairment.
Income earned from joint venture entities reduce the carrying amount of the investment.
Investments and other financial assets
Investments and other financial assets are initially measured at fair value. Transaction costs are included as part of the initial
measurement, except for financial assets at fair value through profit or loss. Such assets are subsequently measured at
either amortised cost or fair value depending on their classification. Classification is determined based on both the business
model within which such assets are held and the contractual cash flow characteristics of the financial asset unless an
accounting mismatch is being avoided.
Financial assets are derecognised when the rights to receive cash flows have expired or have been transferred and the
Company has transferred substantially all the risks and rewards of ownership. When there is no reasonable expectation of
recovering part or all of a financial asset, its carrying value is written off.
Financial assets at amortised cost
A financial asset is measured at amortised cost only if both of the following conditions are met: (i) it is held within a business
model whose objective is to hold assets in order to collect contractual cash flows; and (ii) the contractual terms of the financial
asset represent contractual cash flows that are solely payments of principal and interest.
Investments
Investments includes non-derivative financial assets with fixed or determinable payments and fixed maturities where the
Company has the positive intention and ability to hold the financial asset to maturity. This category excludes financial assets
that are held for an undefined period. Investments are carried at amortised cost using the effective interest rate method
adjusted for any principal repayments. Gains and losses are recognised in profit or loss when the asset is derecognised or
impaired.
Impairment of financial assets
The Company recognises a loss allowance for expected credit losses on financial assets which are either measured at
amortised cost or fair value through other comprehensive income. The measurement of the loss allowance depends upon
the Company's assessment at the end of each reporting period as to whether the financial instrument's credit risk has
increased significantly since initial recognition, based on reasonable and supportable information that is available, without
undue cost or effort to obtain.
1414 Degrees Ltd
Notes to the financial statements
30 June 2023
Note 1. Significant accounting policies (continued)
29
Where there has not been a significant increase in exposure to credit risk since initial recognition, a 12-month expected credit
loss allowance is estimated. This represents a portion of the asset's lifetime expected credit losses that is attributable to a
default event that is possible within the next 12 months. Where a financial asset has become credit impaired or where it is
determined that credit risk has increased significantly, the loss allowance is based on the asset's lifetime expected credit
losses. The amount of expected credit loss recognised is measured on the basis of the probability weighted present value of
anticipated cash shortfalls over the life of the instrument discounted at the original effective interest rate.
For financial assets mandatorily measured at fair value through other comprehensive income, the loss allowance is
recognised in other comprehensive income with a corresponding expense through profit or loss. In all other cases, the loss
allowance reduces the asset's carrying value with a corresponding expense through profit or loss.
Impairment of non-financial assets
Non-financial assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying
amount may not be recoverable. An impairment loss is recognised for the amount by which the asset's carrying amount
exceeds its recoverable amount.
Recoverable amount is the higher of an asset's fair value less costs of disposal and value-in-use. The value-in-use is the
present value of the estimated future cash flows relating to the asset using a pre-tax discount rate specific to the asset or
cash-generating unit to which the asset belongs. Assets that do not have independent cash flows are grouped together to
form a cash-generating unit.
Goods and Services Tax ('GST') and other similar taxes
Revenues, expenses and assets are recognised net of the amount of associated GST, unless the GST incurred is not
recoverable from the tax authority. In this case it is recognised as part of the cost of the acquisition of the asset or as part of
the expense.
Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of GST
recoverable from, or payable to, the tax authority is included in other receivables or other payables in the statement of
financial position.
Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities
which are recoverable from, or payable to the tax authority, are presented as operating cash flows.
Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the tax authority.
Note 2. Critical accounting judgements, estimates and assumptions
The preparation of the financial statements requires management to make judgements, estimates and assumptions that
affect the reported amounts in the financial statements. Management continually evaluates its judgements and estimates in
relation to assets, liabilities, contingent liabilities, revenue and expenses. Management bases its judgements, estimates and
assumptions on historical experience and on other various factors, including expectations of future events, management
believes to be reasonable under the circumstances. The resulting accounting judgements and estimates will seldom equal
the related actual results. The judgements, estimates and assumptions that have a significant risk of causing a material
adjustment to the carrying amounts of assets and liabilities (refer to the respective notes) within the next financial year are
discussed below.
Key estimates - impairment
The Company assesses impairment at the end of each reporting period by evaluating conditions and events specific to the
Company that may be indicative of impairment triggers. Recoverable amounts of relevant assets are reassessed using value-
in-use calculations which incorporate various key assumptions.
With respect to cash flow projections for intangible assets and those with a finite useful life but not yet considered ready for
use, relevant inputs have been factored into valuation models on the basis of management’s expectations regarding the
growth of the market and the Company’s ability to capture market share. Pre-tax discount rates of 15.8% have been used in
all models.
1414 Degrees Ltd
Notes to the financial statements
30 June 2023
30
Note 2. Critical accounting judgements, estimates and assumptions (continued)
Key estimates - Gas-TESS Decommissioning Provision
The original $500,000 provision for decommissioning the Gas-TESS (Glenelg Project) site was based on supplier estimates
for removal and reinstatement works on major components.
The Company has since decided to demolish the prototype instead of relocating it. This has resulted in a reduction of
estimated costs by $466,000. The provision recognised for costs to demolishment and reinstatement works is now $34,000.
Key judgements - product development
Included within intangible assets at the end of the reporting period is Product Development with a net carrying value of
$2,349,225 (30 June 2022: $1,822,904) being the carrying value of the Product Development intangible asset of $13,165,287
(30 June 2022: $10,018,165) less the associated Government Grant funding of $2,743,000 (30 June 2022: $1,896,000), the
R&D refundable tax offsets applied of $6,423,062 (30 June 2022: $5,249,261) and the Woodside Energy Technologies Pty
Ltd contributions applied $1,650,000 (30 June 2022: $1,050,000). The Directors believe that while the development and
commercialisation of the technology remains in-progress and the asset is not yet generating economic benefits (beyond
customer trials), it is not considered ready for use. A reliable estimate for the useful life of the asset will only be capable of
being determined once the asset is assessed as ready for use, after which point, amortisation will commence. The Directors
are satisfied that it is probable that the intangible asset will generate future economic benefits based on internal financial
models and potential project scenario analysis.
Employee benefits provision
The liability for employee benefits expected to be settled more than 12 months from the reporting date are recognised and
measured at the present value of the estimated future cash flows to be made in respect of all employees at the reporting
date. In determining the present value of the liability, estimates of attrition rates and pay increases through promotion and
inflation have been taken into account.
SiliconAurora Joint Control
Management have determined that the Company has joint control of SiliconAurora Pty Ltd ("SiliconAurora") with Vast Solar
Pty Ltd ("Vast"). The arrangement between the two parties is governed by a contractual agreement requiring the unanimous
consent of the parties involved when relevant activities are undertaken.
Note 3. Other income
30 June 2023 30 June 2022
$
$
Interest received
29,290
19,001
Other income
86,096 547,611
115,386
566,612
Note 4. Other expenses
30 June 2023 30 June 2022
$
$
Directors fees
160,132
161,338
Marketing
129,639
69,542
Occupancy
-
1,556
Other expenses
239,229
32,693
529,000
265,129
1414 Degrees Ltd
Notes to the financial statements
30 June 2023
Note 5. Income tax expense
30 June 2023 30 June 2022
$
$
31
Numerical reconciliation of income tax expense and tax at the statutory rate
Loss before income tax expense
(1,831,251)
(1,369,310)
Tax at the statutory tax rate of 25%
(457,813)
(342,328)
Tax effect amounts which are not deductible/(taxable) in calculating taxable income:
Share-based payments
(21,794)
44,736
Share of loss - Silicon Aurora Joint Venture
93,872
-
Non-deductible expenses
658
34,442
Other reconciling items
-
(47,422)
(385,077)
(310,572)
Current year tax losses not recognised
464,873
306,784
Current year temporary differences not recognised
(79,796)
3,788
Income tax expense
-
-
30 June 2023 30 June 2022
$
$
Tax losses not recognised
Unused tax losses for which no deferred tax asset has been recognised
7,205,044
6,133,428
Potential tax benefit @ 25%
1,801,261
1,533,357
The above potential tax benefit for tax losses has not been recognised in the statement of financial position. These tax losses
can only be utilised in the future if the continuity of ownership test is passed, or failing that, the same business test is passed.
30 June 2023 30 June 2022
$
$
Deferred tax assets/liabilities not recognised
Deferred tax assets not recognised comprises temporary differences attributable to:
Right of use assets
(56,548)
(103,677)
Lease liabilities
56,839
58,042
Employee benefits
43,731
42,041
Provision for remediation
8,500
-
Accrued expenses
2,792
-
Accrued income
(3)
(9)
Total deferred tax not recognised
55,311
(3,603)
The above potential tax benefit, which excludes tax losses, for deductible temporary differences has not been recognised in
the statement of financial position as the recovery of this benefit is uncertain.
Note 6. Cash and cash equivalents
30 June 2023 30
$
June 2022
$
Current assets
Cash at bank
1,948,457
3,549,416
1414 Degrees Ltd
Notes to the financial statements
30 June 2023
32
Note 6. Cash and cash equivalents (continued)
An amount of $237,120 is included as cash has been set aside to support bank guarantees issued to the landlords of rented
locations.
Accounting policy for cash and cash equivalents
Cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other short-term, highly
liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and
which are subject to an insignificant risk of changes in value.
Note 7. Trade and other receivables
30 June 2023 30
$
June 2022
$
Current assets
Trade receivables
31,206
900,000
R & D refundable tax offset
878,000
991,633
SiliconAurora sale proceeds receivable
1,500,000
1,500,000
Other receivables
75,790
50,991
2,484,996
3,442,624
Non-current assets
SiliconAurora Pty Ltd loan
360,456
64,075
2,845,452
3,506,699
SiliconAurora sale proceeds receivable
On 19 June 2022 the Company entered into an agreement for the sale of 50% of the shares in SiliconAurora Pty Ltd to a
wholly owned subsidiary of Vast Solar Pty Ltd (Vast Solar). Part of the consideration for the sale is deferred until 30 days
after SiliconAurora receives a written offer to connect to the transmission system from the relevant Network Service Provider
under the rules of the National Electricity Market.
SiliconAurora Pty Ltd loan
The loan to SiliconAurora Pty Ltd is unsecured with a term of 36 months. No interest is charged on the loan balance.
Accounting policy for trade and other receivables
Trade receivables are initially recognised at fair value and subsequently measured at amortised cost using the effective
interest method, less any allowance for expected credit losses. Trade receivables are generally due for settlement within 30
days.
The Company has applied the simplified approach to measuring expected credit losses, which uses a lifetime expected loss
allowance. To measure the expected credit losses, trade receivables have been grouped based on days overdue.
Other receivables are recognised at amortised cost, less any allowance for expected credit losses.
1414 Degrees Ltd
Notes to the financial statements
30 June 2023
Note 8. Joint venture investment
30 June 2023 30 June 2022
$
$
Non-current assets
33
SiliconAurora Pty Ltd
2,124,512
2,500,000
Reconciliation
Reconciliation of the fair values at the beginning and end of the current and previous
financial year are set out below:
Opening fair value
2,500,000
-
Additions
-
2,500,000
Share of loss
(375,488)
-
Closing fair value
2,124,512
2,500,000
On 19 June 2022 the Company entered into an agreement for the sale of 50% of the shares in SiliconAurora Pty Ltd to a
wholly owned subsidiary of Vast Solar Pty Ltd (Vast).
Under the terms of the sale agreement the purchase price of $2,500,000 was payable in two instalments. An initial $1,000,000
was received upon completion and a further $1,500,000 will be paid when SiliconAurora receives a written offer to connect
to the transmission system from the relevant Network Service Provider under the rules of the National Electricity Market. The
$1,500,000 was still outstanding as at 30 June 2023 (note 7).
In addition to the sale agreement Vast and the Company have executed a Shareholders Agreement that will govern the
ongoing operation of SiliconAurora and the development of the Aurora Energy Project.
Note 9. Right-of-use assets
30 June 2023 30 June 2022
$
$
Non-current assets
Land and buildings - right-of-use
761,469
716,307
Less: Accumulated depreciation
(535,277)
(301,602)
226,192
414,705
Reconciliations
Reconciliations of the written down values at the beginning and end of the current financial year are set out below:
Daws Road
$
Total
$
Balance at 1 July 2022
414,705
414,705
Revaluation increments
45,162
45,162
Depreciation expense
(233,675)
(233,675)
Balance at 30 June 2023
226,192
226,192
Accounting policy for right-of-use assets
A right-of-use asset is recognised at the commencement date of a lease. The right-of-use asset is measured at cost, which
comprises the initial amount of the lease liability, adjusted for, as applicable, any lease payments made at or before the
commencement date net of any lease incentives received, any initial direct costs incurred, and, except where included in the
cost of inventories, an estimate of costs expected to be incurred for dismantling and removing the underlying asset, and
restoring the site or asset.
1414 Degrees Ltd
Notes to the financial statements
30 June 2023
34
Note 9. Right-of-use assets (continued)
Right-of-use assets are depreciated on a straight-line basis over the unexpired period of the lease or the estimated useful
life of the asset, whichever is the shorter. Where the Company expects to obtain ownership of the leased asset at the end of
the lease term, the depreciation is over its estimated useful life. Right-of use assets are subject to impairment or adjusted for
any remeasurement of lease liabilities.
The Company has elected not to recognise a right-of-use asset and corresponding lease liability for short-term leases with
terms of 12 months or less and leases of low-value assets. Lease payments on these assets are expensed to profit or loss
as incurred.
Note 10. Other
30 June 2023 30 June 2022
$
$
Current assets
Prepayments
169,798
136,984
Other current assets
2,688
37
172,486
137,021
Note 11. Property, plant and equipment
30 June 2023 30 June 2022
$
$
Non-current assets
Fixtures and fittings - at cost
140,515
140,515
Less: Accumulated depreciation
(103,975)
(89,286)
36,540
51,229
Office equipment - at cost
74,181
64,466
Less: Accumulated depreciation
(62,582)
(54,728)
11,599
9,738
48,139
60,967
Accounting policy for property, plant and equipment
Plant and equipment is stated at historical cost less accumulated depreciation and impairment. Historical cost includes
expenditure that is directly attributable to the acquisition of the items.
Depreciation is calculated on a straight-line basis to write off the net cost of each item of property, plant and equipment
(excluding land) over their expected useful lives as follows:
Leasehold improvements
3-10 years
Office equipment
3-7 years
The residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each reporting date.
Leasehold improvements are depreciated over the unexpired period of the lease or the estimated useful life of the assets,
whichever is shorter.
An item of property, plant and equipment is derecognised upon disposal or when there is no future economic benefit to the
Company. Gains and losses between the carrying amount and the disposal proceeds are taken to profit or loss.
1414 Degrees Ltd
Notes to the financial statements
30 June 2023
Note 12. Intangibles
30 June 2023 30 June 2022
$
$
Non-current assets
35
Product development - intellectual property at cost
13,162,457
10,018,165
Government grants and R & D refundable tax offsets applied
(9,150,388)
(7,145,261)
Woodside funding applied
(1,650,000) (1,050,000)
2,362,069
1,822,904
Reconciliations
Reconciliations of the written down values at the beginning and end of the current financial year are set out below:
TESS
Development
Total
$
$
Balance at 1 July 2022
1,822,904
1,822,904
Additions
3,144,292
3,144,292
Government grants applied
(847,000)
(847,000)
R & D tax offset applied
(1,158,127)
(1,158,127)
Woodside funding applied
(600,000)
(600,000)
Balance at 30 June 2023
2,362,069
2,362,069
Intellectual property consists of TESS (thermal energy storage system) development of bulk energy storage solutions.
No amortisation has been recognised as the intellectual property is not available for use as at 30 June 2023. The intangible
asset is tested for impairment annually. The government grants relate to accelerating the commercialisation of the Company's
intellectual property.
The recoverable amount of the Company's Product Development intangible asset has been determined by a value-in-use
calculation using a discounted cash flow model, based on an 8 year projection period approved by management.
The following key assumptions were used in the discounted cash flow model:
● 15.8% pre-tax discount rate;
● No revenue earned until 2025;
● Major project deliverable in 2025
The discount rate of 15.8% pre-tax reflects management’s estimate of the time value of money and the Company’s weighted
average cost of capital, the risk free rate and the volatility of the share price relative to market movements.
Management believes the revenue presented in the model is justified, based on the potential indicated in the market.
There were no other key assumptions.
Note 13. Trade and other payables
30 June 2023 30 June 2022
$
$
Current liabilities
Trade payables
382,575
355,481
Other payables and accruals
102,971
89,511
485,546
444,992
1414 Degrees Ltd
Notes to the financial statements
30 June 2023
36
Note 13. Trade and other payables (continued)
Refer to note 21 for further information on financial instruments.
Accounting policy for trade and other payables
These amounts represent liabilities for goods and services provided to the Company prior to the end of the financial year and
which are unpaid. Due to their short-term nature they are measured at amortised cost and are not discounted. The amounts
are unsecured and are usually paid within 30 days of recognition.
Note 14. Lease liabilities
30 June 2023 30 June 2022
$
$
Current liabilities
Lease liability
227,357 205,000
Non-current liabilities
Lease liability
- 232,167
227,357
437,167
Refer to note 21 for further information on financial instruments.
Total interest incurred on the lease liability for the year was $17,041 (2022: $147,758).
Accounting policy for lease liabilities
A lease liability is recognised at the commencement date of a lease. The lease liability is initially recognised at the present
value of the lease payments to be made over the term of the lease, discounted using the interest rate implicit in the lease or,
if that rate cannot be readily determined, the Company's incremental borrowing rate. Lease payments comprise of fixed
payments less any lease incentives receivable, variable lease payments that depend on an index or a rate, amounts expected
to be paid under residual value guarantees, exercise price of a purchase option when the exercise of the option is reasonably
certain to occur, and any anticipated termination penalties. The variable lease payments that do not depend on an index or
a rate are expensed in the period in which they are incurred.
Lease liabilities are measured at amortised cost using the effective interest method. The carrying amounts are remeasured
if there is a change in the following: future lease payments arising from a change in an index or a rate used; residual
guarantee; lease term; certainty of a purchase option and termination penalties. When a lease liability is remeasured, an
adjustment is made to the corresponding right-of use asset, or to profit or loss if the carrying amount of the right-of-use asset
is fully written down.
Note 15. Employee benefits
30 June 2023 30 June 2022
$
$
Current liabilities
Annual leave
86,731
58,577
Long service leave
38,098
-
124,829
58,577
Non-current liabilities
Long service leave
21,457
75,238
146,286
133,815
1414 Degrees Ltd
Notes to the financial statements
30 June 2023
Note 15. Employee benefits (continued)
37
Accounting policy for employee benefits
Short-term employee benefits
Liabilities for wages and salaries, including non-monetary benefits, annual leave and long service leave expected to be
settled wholly within 12 months of the reporting date are measured at the amounts expected to be paid when the liabilities
are settled.
Other long-term employee benefits
The liability for annual leave and long service leave not expected to be settled within 12 months of the reporting date are
measured at the present value of expected future payments to be made in respect of services provided by employees up to
the reporting date using the projected unit credit method. Consideration is given to expected future wage and salary levels,
experience of employee departures and periods of service. Expected future payments are discounted using market yields at
the reporting date on high quality corporate bonds with terms to maturity and currency that match, as closely as possible, the
estimated future cash outflows.
Note 16. Provisions
30 June 2023 30 June 2022
$
$
Current liabilities
Provision for Gas-TESS decommissioning
34,000
500,000
Movements in provisions
Movements in each class of provision during the current financial year, other than employee benefits, are set out below:
Gas-TESS
Decommissioning
Provision
30 June 2023
$
Carrying amount at the start of the year
500,000
Reduction in estimated costs
(466,000)
Carrying amount at the end of the year
34,000
Gas-TESS Decommissioning Provision
In the year ended 30 June 2022 a $500,000 provision for decommissioning the Gas-TESS (Glenelg Project) site was
recognised. The provision based on supplier estimates for removal and reinstatement works on major components.
The Company has since decided to demolish the prototype instead of relocating it. This has resulted in a reduction of
estimated costs by $466,000. The provision recognised for costs to demolishment and reinstatement works is now $34,000.
Accounting policy for provisions
Provisions are recognised when the Company has a present (legal or constructive) obligation as a result of a past event, it
is probable the Company will be required to settle the obligation, and a reliable estimate can be made of the amount of the
obligation. The amount recognised as a provision is the best estimate of the consideration required to settle the present
obligation at the reporting date, taking into account the risks and uncertainties surrounding the obligation. If the time value of
money is material, provisions are discounted using a current pre-tax rate specific to the liability. The increase in the provision
resulting from the passage of time is recognised as a finance cost.
Note 17. Contributed equity
30 June 2023 30 June 2022 30 June 2023 30 June 2022
Shares
Shares
$
$
Ordinary shares - fully paid
205,485,458 201,985,458 33,002,185 32,656,879
1414 Degrees Ltd
Notes to the financial statements
30 June 2023
38
Note 17. Contributed equity (continued)
Movements in ordinary share capital
Details
Date
Shares
Issue price
$
Balance
1 July 2022
201,985,458
32,656,879
Placement of shares
17 March 2023
3,000,000
$0.100
300,000
Conversion of performance rights
12 April 2023
500,000
$0.137
68,500
Transaction costs
-
$0.000
(23,194)
Balance
30 June 2023
205,485,458
33,002,185
Ordinary shares
Ordinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the Company in proportion
to the number of and amounts paid on the shares held. The fully paid ordinary shares have no par value and the Company
does not have a limited amount of authorised capital.
On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each
share shall have one vote.
Share buy-back
There is no current on-market share buy-back.
Capital risk management
The Company's objectives when managing capital is to safeguard its ability to continue as a going concern, so that it can
provide returns for shareholders and benefits for other stakeholders and to maintain an optimum capital structure to reduce
the cost of capital.
The Company would look to raise capital when an opportunity to invest in a business or company was seen as value adding
relative to the current Company's share price at the time of the investment. The Company is not actively pursuing additional
investments in the short term as it continues to integrate and grow its existing businesses in order to maximise synergies.
The group's debt and capital includes ordinary shares capital and financial liabilities, supported by financial assets. There
are no externally imposed capital requirements.
Management effectively manages the group's capital by assessing the group's financial risks and adjusting its capital
structure in response to changes in these risks and in the market.
The capital risk management policy remains unchanged from the 30 June 2022 Annual Report.
Accounting policy for issued capital
Ordinary shares are classified as equity.
Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax,
from the proceeds.
Note 18. Reserves
30 June 2023 30 June 2022
$
$
Share-based payments reserve
167,720
323,395
1414 Degrees Ltd
Notes to the financial statements
30 June 2023
Note 18. Reserves (continued)
39
Movements in reserves
Movements in each class of reserve during the current financial year are set out below:
Share based
payments
reserve - ESS
Share based
payments
reserve - Call
Option
Total
$
$
$
Balance at 1 July 2022
155,803
167,592
323,395
Performance rights valuation recognised
15,681
-
15,681
Performance rights lapsed
(102,856)
-
(102,856)
Conversion of Performance Rights to Ordinary Shares
(68,500)
-
(68,500)
Balance at 30 June 2023
128
167,592
167,720
Share-based payments reserve - ESS
The reserve is used to recognise the value of equity benefits provided to employees and Directors as part of their
remuneration.
Share-based payments reserve - Call Option
As part of the sale agreement of Silicon Aurora Pty Ltd entities associated with the owners of Vast Solar were granted Call
Options with a strike price of $0.16 per share. The call options were valued at $167,592 and a share based payment was
recognised in the year ended 30 June 2021, reducing the profit on the sale of the shares in SiliconAurora Pty Ltd.
Note 19. Accumulated losses
30 June 2023 30 June 2022
$
$
Accumulated losses at the beginning of the financial year
(22,504,536) (21,135,226)
Loss after income tax expense for the year
(1,831,251) (1,369,310)
Accumulated losses at the end of the financial year
(24,335,787) (22,504,536)
Note 20. Dividends
There were no dividends paid, recommended or declared during the current or previous financial year.
Note 21. Financial instruments
Financial risk management objectives
The Company's financial instruments consist mainly of deposits with banks, accounts receivable and payable.
The totals for each category of financial instruments, measured in accordance with AASB 9 as detailed in the accounting
policies to these financial statements, are as follows:
1414 Degrees Ltd
Notes to the financial statements
30 June 2023
Note 21. Financial instruments (continued)
40
Financial assets
30 June 2023 30 June 2022
$
$
Financial assets at amortised cost:
Cash and cash equivalents
1,948,567
3,549,416
Trade and other receivables - SiliconAurora Sales Proceeds
1,500,000
2,400,000
Trade and other receivables - R&D tax refund
878,000
991,633
Trade and other receivables - other
106,996
50,991
Total financial assets
4,433,563
6,992,040
Financial liabilities
Trade and other payables
446,993
444,992
Lease liabilities
227,357
437,167
Total financial liabilities
674,350
882,159
General objectives, policies and processes
In common with all other businesses, the Company is exposed to risks that arise from its use of financial instruments. This
note describes the Company's objectives, policies and processes for managing those risks and the methods used to measure
them. Further quantitative information in respect of these risks is presented throughout these financial statements.
There have been no substantive changes in the Company's exposure to financial instrument risks, its objectives, polices and
processes for managing those risks or the methods to measure them from previous periods unless otherwise stated in this
note.
Market risk
The Company’s activities have no material exposure to financial risks of changes in interest rates. The Company analyses
it’s risk by considering sensitivity on its interest rate exposures and determining the potential impact on it’s effected expenses
and revenue of movements in these rates. If the potential variance is material then management may seek to minimise this
exposure but it does not consider this to be the case at this time.
Foreign currency risk
The Company undertakes certain transactions denominated in foreign currency and is exposed to foreign currency risk
through foreign exchange rate fluctuations.
Foreign exchange risk arises from future commercial transactions and recognised financial assets and financial liabilities
denominated in a currency that is not the entity's functional currency. The risk is measured using sensitivity analysis and
cash flow forecasting.
The carrying amount of the Company's foreign currency denominated financial assets and financial liabilities at the reporting
date were as follows:
Assets
Liabilities
30 June 2023 30 June 2022 30 June 2023 30 June 2022
$
$
$
$
US dollars
131
840
-
-
Euros
542
486
-
-
673
1,326
-
-
The Company had net assets denominated in foreign currencies of $673 as at 30 June 2023 (2022: $1,326).
Based on this exposure, had the Australian dollar weakened by 10%/strengthened by 5% (2022: weakened by
10%/strengthened by 5%) against these foreign currencies with all other variables held constant, the Company's profit before
tax for the year would have been $67lower/$34 higher (2022: $133 lower/$66 higher) and equity would have been
$67lower/$34 higher (2022: $133 lower/$66 higher).
1414 Degrees Ltd
Notes to the financial statements
30 June 2023
Note 21. Financial instruments (continued)
41
The percentage change is the expected overall volatility of the significant currencies, which is based on management's
assessment of reasonable possible fluctuations taking into consideration movements over the last 6 months each year and
the spot rate at each reporting date.
The actual foreign exchange loss for the year ended 30 June 2023 was $5,014 (2022: loss of $6,138).
Interest rate risk
At 30 June 2023 investment in Cash, Fixed Interest and Floating Interest rate deposits amounted to $1,948,457. A +/-1%
change in interest rates during the year ended 30t June 2023 will result in a +/- change in net interest income of $19,485.
At 30 June 2022 investment in Cash, Fixed Interest and Floating Interest rate deposits amounted to $3,549,416. A +/-1%
change in interest rates during the year ended 30 June 2023 will result in a +/- change in net interest income of $35,494.
Management have considered that both a positive and negative 1% variance is sufficient to illustrate the potential variations
in interest income.
Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the
Company.
The Company does not have any material credit risk exposure to any single debtor or group of debtors under financial
instruments entered into by the group, except for the Australian Taxation Office which is the counter party to the R & D Offset
shown in note 7 and Vast Solar Pty Ltd which is our Joint Venture partner following their purchase of 50% of the shares in
Silicon Aurora Pty Ltd. Trade receivables represent the maximum exposure to credit risk, credit quality is considered good.
Liquidity risk
Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due. The Directors
manage liquidity risk by monitoring forecast cashflows and ensuring that the Company's operations are adequate to meet
liabilities due.
Financial liability and financial asset maturity analysis
1 year or less
Between 1
and 2 years
Between 2
and 5 years
Over 5 years
Total
30 June 2023
$
$
$
$
$
Financial liabilities due for settlement
Trade and other payables
446,993
-
-
-
446,993
Lease liabilities
227,357
-
-
-
227,357
Financial assets - cash flows realisable
Cast at bank
1,948,457
-
-
-
1,948,457
Trade and other receivables
2,484,996
-
-
-
2,484,996
Other loans
- 64,075 296,381
- 360,456
Total non-derivatives
5,107,803 64,075 296,381
- 5,468,259
1414 Degrees Ltd
Notes to the financial statements
30 June 2023
Note 21. Financial instruments (continued)
42
1 year or less
Between 1
and 2 years
Between 2
and 5 years
Over 5 years
Remaining
contractual
maturities
30 June 2022
$
$
$
$
$
Financial liabilities due for settlement
Trade and other payables
444,992
-
-
-
444,992
Lease liabilities
205,000
232,167
-
-
437,167
Financial assets - cash flows realisable
Cash at bank
3,549,416
-
-
-
3,549,416
Trade and other receivables
3,442,624
-
-
-
3,442,624
Other loans
-
-
64,075
-
64,075
Total non-derivatives
7,642,032
232,167
64,075
-
7,938,274
The cash flows in the maturity analysis above are not expected to occur significantly earlier than contractually disclosed
above.
Note 22. Key management personnel disclosures
Compensation
The aggregate compensation made to Directors and other members of key management personnel of the Company is set
out below:
30 June 2023 30 June 2022
$
$
Short-term employee benefits
356,986
800,395
Post-employment benefits
18,249
50,408
Long-term benefits
-
7,165
Share-based payments
-
75,300
375,235
933,268
Note 23. Remuneration of auditors
During the financial year the following fees were paid or payable for services provided by BDO Audit Pty Ltd, the auditor of
the Company:
30 June 2023 30 June 2022
$
$
Audit services - BDO Audit Pty Ltd
Audit or review of the financial statements
33,500
35,000
Note 24. Contingent liabilities
As at 30 June 2023 those charged with governance of the group note that there are no known contingent liabilities (2022:
nil).
1414 Degrees Ltd
Notes to the financial statements
30 June 2023
Note 25. Commitments
43
30 June 2023 30 June 2022
$
$
Capital commitments
Committed at the reporting date but not recognised as liabilities, payable:
Property, plant and equipment - Furnace
-
521,213
Aurora Energy Project
On 15 June 2022 the Company and a wholly owned subsidiary of Vast Solar Pty Ltd (Vast) entered into a Shareholder
Agreement (SA) with for the 50/50 incorporated Joint Venture of SiliconAurora Pty Ltd (SiliconAurora). The SA governs the
ongoing operation of SiliconAurora and the development of the Aurora Energy Project (Aurora).
The SA includes an agreement to complete all development activities required to get to Stage 1 of Aurora (a 140 MW 1-2
hour Battery Energy Storage System or BESS) to a position of readiness for a Final Investment Decision (FID). Under the
terms of the agreement, Vast and the Company will each contribute 50% of the development costs associated with the Stage
1 Development. At 30 June 2023 the Joint Venture partners had contributed $719,863 in total (2021: $127,100). Total budget
for the Stage 1 development costs up until FID is estimated to be approximately $1.8million.
Note 26. Related party transactions
Parent entity
1414 Degrees Ltd is the parent entity.
Joint ventures
Interests in joint ventures are set out in note 27.
Key management personnel
Disclosures relating to key management personnel are set out in note 22 and the remuneration report included in the
Directors' report.
Transactions with related parties
The following transactions occurred with related parties:
30 June 2023 30 June 2022
$
$
Payment for other expenses:
Other expenses paid on behalf of joint venture
296,381
64,075
Other expenses paid to key management personnel
23,350
-
A related party of the Executive Chairman is an employee and shareholder of the Company. Their employment arrangements
are set by an employment contract as agreed by the board.
Receivable from and payable to related parties
There were no trade receivables from or trade payables to related parties at the current and previous reporting date.
Loans to/from related parties
The following balances are outstanding at the reporting date in relation to loans with related parties:
30 June 2023 30 June 2022
$
$
Current receivables:
Loan to joint venture
360,456
64,075
Terms and conditions
All transactions were made on normal commercial terms and conditions and at market rates.
1414 Degrees Ltd
Notes to the financial statements
30 June 2023
Note 27. Interests in joint ventures
44
Interests in joint ventures are accounted for using the equity method of accounting. Information relating to joint ventures that
are material to the Company are set out below:
Name
Principal place of business /
Country of incorporation
Ownership interest
30 June 2023 30 June 2022
%
%
SiliconAurora Pty Ltd
Australia
50.00%
50.00%
Note 28. Events after the reporting period
On 14 July 2023 the Company announced a non-renounceable pro-rata offer of new fully paid shares (Entitlement Offer).
The Entitlement Offer closed on 14 August 2023 and was strongly supported by existing shareholders. The Company
received total applications from Eligible Shareholders of approximately $1,471 million (equal to 32,683,063 fully paid shares).
In accordance with the terms and conditions set out in the prospectus dated 14 July 2023, one free attaching option
exercisable at $0.10 each on or before the day that is 24 months after the date of issue will be issued for each new fully paid
share applied for and issued under the entitlement offer.
No other matter or circumstance has arisen since 30 June 2023 that has significantly affected, or may significantly affect the
Company's operations, the results of those operations, or the Company's state of affairs in future financial years.
Note 29. Reconciliation of loss after income tax to net cash used in operating activities
30 June 2023 30
$
June 2022
$
Loss after income tax expense for the year
(1,831,251)
(1,369,310)
Adjustments for:
Depreciation and amortisation
30,200
253,574
Impairment of non-current assets
-
997,516
Share-based payments
(87,175)
316,713
Foreign exchange differences
-
(44)
SiliconAurora sale proceeds
-
(2,400,000)
50% of SiliconAurora assets sold
-
769,362
SiliconAurora fair value adjustment
-
(1,730,638)
Silicon Aurora - share of loss
375,488
-
Provision for Gas-TESS decommissioning
(466,000)
500,000
Lease payments
6,382
-
Change in operating assets and liabilities:
Decrease/(increase) in trade and other receivables
(56,006)
18,522
Increase in other current assets
(35,463)
(5,300)
Decrease in lease liability
-
350,000
Decrease in trade and other payables
40,554
(161,451)
Increase in employee benefits
12,471
23,918
Net cash used in operating activities
(2,010,800)
(2,437,138)
Note 30. Earnings per share
30 June 2023 30 June 2022
$
$
Loss after income tax attributable to the owners of 1414 Degrees Ltd
(1,831,251)
(1,369,310)
1414 Degrees Ltd
Notes to the financial statements
30 June 2023
Note 30. Earnings per share (continued)
45
Number
Number
Weighted average number of ordinary shares used in calculating basic earnings per share
201,291,280 200,310,458
Weighted average number of ordinary shares used in calculating diluted earnings per share
201,291,280
200,310,458
Cents
Cents
Basic earnings per share
(0.91)
(0.68)
Diluted earnings per share
(0.91)
(0.68)
Accounting policy for earnings per share
Basic earnings per share
Basic earnings per share is calculated by dividing the profit attributable to the owners of 1414 Degrees Ltd, excluding any
costs of servicing equity other than ordinary shares, by the weighted average number of ordinary shares outstanding during
the financial year, adjusted for bonus elements in ordinary shares issued during the financial year.
Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account the
after income tax effect of interest and other financing costs associated with dilutive potential ordinary shares and the weighted
average number of shares assumed to have been issued for no consideration in relation to dilutive potential ordinary shares.
Note 31. Share-based payments
500,000 shares were issued to employees of the Company in this financial year as part of the Company's Performance
Right's plan (2022: nil).
During the year no shares were issued to key management personnel as part of the Company's Performance Rights Plan
(2022: 700,000 shares), During the year no shares were issued to key management personnel as part of compensation
(2022: 50,000 shares).
A Performance Rights Plan was established by the Company in the 2019 financial year, whereby the Company may, at the
discretion of the board, grant Performance Rights over ordinary shares in the Company to certain employees of the Company.
The performance rights are issued for nil consideration and vest in accordance with performance guidelines established by
the board.
Set out below are summaries of performance rights outstanding at the end of the financial year:
30 June 2023
Grant date
Expiry date
Exercise
price
Balance at
the start of
the year
Granted
Exercised
Expired/
forfeited/
other
Balance at
the end of
the year
02/04/2019
15/01/2023
$0.000
500,000
-
(250,000)
(250,000)
-
23/07/2020
15/01/2023
$0.000
1,000,000
-
(250,000)
(750,000)
-
09/04/2021
15/01/2023
$0.000
50,000
-
-
(50,000)
-
09/04/2021
15/01/2024
$0.000
500,000
-
-
(500,000)
-
06/06/2022
15/06/2023
$0.000
200,000
-
-
(200,000)
-
25/05/2023
25/05/2024
$0.000
-
855,000
-
-
855,000
25/05/2023
25/05/2025
$0.000
-
1,210,000
-
-
1,210,000
25/05/2023
25/05/2026
$0.000
-
2,400,000
-
-
2,400,000
2,250,000
4,465,000
(500,000) (1,750,000)
4,465,000
1414 Degrees Ltd
46
Notes to the financial statements
30 June 2023
Note 31. Share-based payments (continued)
30 June 2022
Balance at
Expired/
Balance at
Grant date
Expiry date
Exercise
price
the start of
the year
Granted
Exercised
forfeited/
other
the end of
the year
02/04/2019
15/01/2023
$0.000
500,000
-
-
-
500,000
23/07/2020
01/07/2021
$0.000
250,000
-
(250,000)
-
-
23/07/2020
01/07/2022
$0.000
100,000
-
-
(100,000)
-
23/07/2020
15/01/2023
$0.000
1,000,000
-
-
-
1,000,000
30/11/2020
15/07/2021
$0.000
500,000
-
-
(500,000)
-
30/11/2020
31/07/2021
$0.000
400,000
-
-
(400,000)
-
09/04/2021
15/07/2021
$0.000
250,000
-
(200,000)
(50,000)
-
09/04/2021
31/07/2021
$0.000
100,000
-
-
(100,000)
-
09/04/2021
01/09/2021
$0.000
100,000
-
(100,000)
-
-
09/04/2021
15/01/2022
$0.000
325,000
-
(25,000)
(300,000)
-
09/04/2021
15/01/2023
$0.000
100,000
-
-
(50,000)
50,000
09/04/2021
15/01/2024
$0.000
500,000
-
-
-
500,000
09/04/2021
31/12/2021
$0.000
500,000
-
(500,000)
-
-
11/04/2021
14/04/2022
$0.000
-
300,000
(300,000)
-
-
11/04/2022
01/08/2024
$0.000
-
3,200,000
-
(3,200,000)
-
06/06/2022
15/06/2022
$0.000
-
200,000
(200,000)
-
-
06/06/2022
15/06/2023
$0.000
-
200,000
-
-
200,000
4,625,000
3,900,000 (1,575,000) (4,700,000)
2,250,000
There are no performance rights exercisable at the end of the financial year.
The weighted average exercise price during the financial year was $0 (2022: $0).
The weighted average remaining contractual life of options outstanding at the end of the financial year was 2.3 years (2022:
0.8 years).
Accounting policy for share-based payments
Equity-settled share-based compensation benefits are provided to employees.
Equity-settled transactions are awards of shares, or options over shares, that are provided to employees in exchange for the
rendering of services.
The cost of equity-settled transactions are measured at fair value on grant date. Fair value is independently determined using
the Black-Scholes option pricing model that takes into account the exercise price, the term of the option, the impact of dilution,
the share price at grant date and expected price volatility of the underlying share, the expected dividend yield and the risk
free interest rate for the term of the option, together with non-vesting conditions that do not determine whether the Company
receives the services that entitle the employees to receive payment. No account is taken of any other vesting conditions.
The cost of equity-settled transactions are recognised as an expense with a corresponding increase in equity over the vesting
period. The cumulative charge to profit or loss is calculated based on the grant date fair value of the award, the best estimate
of the number of awards that are likely to vest and the expired portion of the vesting period. The amount recognised in profit
or loss for the period is the cumulative amount calculated at each reporting date less amounts already recognised in previous
periods.
Market conditions are taken into consideration in determining fair value. Therefore any awards subject to market conditions
are considered to vest irrespective of whether or not that market condition has been met, provided all other conditions are
satisfied.
If equity-settled awards are modified, as a minimum an expense is recognised as if the modification has not been made. An
additional expense is recognised, over the remaining vesting period, for any modification that increases the total fair value of
the share-based compensation benefit as at the date of modification.
1414 Degrees Ltd
47
Notes to the financial statements
30 June 2023
Note 31. Share-based payments (continued)
If the non-vesting condition is within the control of the Company or employee, the failure to satisfy the condition is treated as
a cancellation. If the condition is not within the control of the Company or employee and is not satisfied during the vesting
period, any remaining expense for the award is recognised over the remaining vesting period, unless the award is forfeited.
If equity-settled awards are cancelled, it is treated as if it has vested on the date of cancellation, and any remaining expense
is recognised immediately. If a new replacement award is substituted for the cancelled award, the cancelled and new award
is treated as if they were a modification.
1414 Degrees Ltd
48
Directors' declaration
30 June 2023
In the Directors' opinion:
●
the attached financial statements and notes comply with the Corporations Act 2001, the Accounting Standards, the
Corporations Regulations 2001 and other mandatory professional reporting requirements;
●
the attached financial statements and notes comply with International Financial Reporting Standards as issued by the
International Accounting Standards Board as described in note 1 to the financial statements;
●
the attached financial statements and notes give a true and fair view of the Company's financial position as at 30 June
2023 and of its performance for the financial year ended on that date; and
●
there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due
and payable.
The Directors have been given the declarations required by section 295A of the Corporations Act 2001.
Signed in accordance with a resolution of Directors made pursuant to section 295(5)(a) of the Corporations Act 2001.
On behalf of the Directors
Kevin Moriarty
Executive Chairman
29 September 2023
BDO Centre
Level 7, 420 King William Street
Adelaide SA 5000
GPO Box 2018 Adelaide SA 5001
Australia
Tel: +61 8 7324 6000
Fax: +61 8 7324 6111
www.bdo.com.au
BDO Audit Pty Ltd ABN 33 134 022 870 is a member of a national association of independent entities which are all members of BDO
Australia Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit Pty Ltd and BDO Australia Ltd are members of
BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member
firms. Liability limited by a scheme approved under Professional Standards Legislation.
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF 1414 DEGREES LTD
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of 1414 Degrees Ltd (the Company), which comprises the
statement of financial position as at 30 June 2023, the statement of profit or loss and other
comprehensive income, the statement of changes in equity and the statement of cash flows for the
year then ended, and notes to the financial report, including a summary of significant accounting
policies, and the directors’ declaration.
In our opinion the accompanying financial report of 1414 Degrees Ltd, is in accordance with the
Corporations Act 2001, including:
(i)
Giving a true and fair view of the Company’s financial position as at 30 June 2023 and of its
financial performance for the year ended on that date; and
(ii)
Complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s responsibilities for the audit of the Financial
Report section of our report. We are independent of the Company in accordance with the
Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical
Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence
Standards) (the Code) that are relevant to our audit of the financial report in Australia. We have also
fulfilled our other ethical responsibilities in accordance with the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has been
given to the directors of the Company, would be in the same terms if given to the directors as at the
time of this auditor’s report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Material uncertainty related to going concern
We draw attention to Note 1 in the financial report which describes the events and/or conditions which
give rise to the existence of a material uncertainty that may cast significant doubt about the entity’s
ability to continue as a going concern and therefore the entity may be unable to realise its assets and
discharge its liabilities in the normal course of business. Our opinion is not modified in respect of this
matter.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in
our audit of the financial report of the current period. These matters were addressed in the context of
our audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide
a separate opinion on these matters. In addition to the matter described in the Material uncertainty
related to going concern section, we have determined the matters described below to be the key audit
matters to be communicated in our report.
Intangible Asset – Product Development
KEY AUDIT MATTER
HOW THE MATTER WAS ADDRESSED IN OUR AUDIT
The carrying value of the intangible
asset product development – intellectual
property as set out in note 12 is a key
audit matter due to:
The significance of the total
balance.
The level of audit procedures
undertaken to evaluate
management’s application of the
recognition criteria for internally
generated intangible assets required
by AASB 138 Intangible Assets.
The level of judgment applied by
management and inherent
subjectivity in their assessment of
the potential impairment of the
asset and compliance with the
requirements of AASB 136
Impairment of Assets.
Our audit procedures included, but were not limited to:
Assessing the composition of development costs and the
capitalisation criteria against the requirements of AASB 138 –
Intangible Assets.
Agreeing a sample of additions to supporting documentation, and
ensuring the amounts were appropriately capitalised.
Obtaining an understanding of the key processes and controls
associated with the allocation of costs to the product
development category.
Assessing the results of trials of the prototype product and the
potential market size for similar applications of the technology.
Considering and evaluating assumptions contained within
management’s impairment assessment and assessing the discount
rate applied.
Performing a sensitivity analysis on the key financial assumptions
of the forecasted cash flows and discount rate in the model and
considering the likelihood of such movements in these key
assumptions.
Other information
The directors are responsible for the other information. The other information comprises the
information in the Company’s annual report for the year ended 30 June 2023, but does not include the
financial report and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and we do not express any
form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of the directors for the Financial Report
The directors of the Company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001
and for such internal control as the directors determine is necessary to enable the preparation of the
financial report that gives a true and fair view and is free from material misstatement, whether due to
fraud or error.
In preparing the financial report, the directors are responsible for assessing the Company’s ability to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless the directors either intend to liquidate the Company or to
cease operations, or has no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with the Australian Auditing Standards will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material
if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of this financial report.
A further description of our responsibilities for the audit of the financial report is located at the
Auditing and Assurance Standards Board website (http://www.auasb.gov.au/Home.aspx) at:
https://www.auasb.gov.au/admin/file/content102/c3/ar2_2020.pdf
This description forms part of our auditor’s report.
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 10 to 14 of the directors’ report for the
year ended 30 June 2023.
In our opinion, the Remuneration Report of 1414 Degrees Ltd, for the year ended 30 June 2023,
complies with section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the
Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility
is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with
Australian Auditing Standards.
BDO Audit Pty Ltd
Paul Gosnold
Director
Adelaide, 29 September 2023
52
1414
1414 Degree
ees
s Limited
Shareholder Information
30 June 2023
The shareholder information set out below was applicable as at 19 September 2023
Distribution of equitable securities
Analysis of number of equitable security holders by size of holding:
Ordinary shares
% of total
Number
of holders
shares
issued
1 to 1,000
66
0.01
1,001 to 5,000
620
0.82
5,001 to 10,000
856
2.73
10,001 to 100,000
1,552
21.58
100,001 and over
361
74.86
3,455
100.00
Holding less than a marketable parcel (at $0.031 per share)
1966
5.94%
Equity security holders
Twenty largest quoted equity security holders:
The names of the twenty largest security holders of quoted equity securities are listed below:
Ordinary shares
% of total
shares
Number held
issued
FOCEM PTY LTD
15,937,916
6.69
AMMJOHN PTY LTD
6,466,039
2.71
MR JOHN HENRY MOSS + MRS WENDY ELIZABETH MOSS
5,249,188
2.20
MEWTWO GLOBAL INVESTMENTS
4,333,333
1.82
MR HAROLD TOMBLIN + MRS JUDITH JOHNSTON
4,206,976
1.77
BNP PARIBAS NOMS PTY LTD
3,408,192
1.43
CITICORP NOMINEES PTY LIMITED
3,125,819
1.31
RJK SHEPHERD SUPER PTY LTD
3,103,941
1.30
JA & JK INVESTMENTS PTY LTD
3,100,130
1.30
BLAKFORD PTY LIMITED
3,000,000
1.26
RANAT INVESTMENTS PTY LTD
3,000,000
1.26
MR JOHN LANGLEY HANCOCK
2,778,333
1.17
MRS SUSAN JACQUELINE JOHNSON
2,657,448
1.12
MARHFEL PTY LTD
2,559,570
1.07
MR IAN ROSS BURDON + MS CATHERINE LOUISE TAYLOR
2,550,000
1.07
BENGER SUPERANNUATION PTY LIMITED
2,300,000
0.97
MR IAN ROSS BURDON + MS CATHERINE LOUISE TAYLOR
2,250,000
0.94
LHO LA PTY LTD
2,137,309
0.90
PACIFIC COMMUNICATION AND INVESTMENT CONSULTANTS PTY LTD
1,750,000
0.73
KNIGHTS VALLEY LTD
1,666,500
0.70
75,580,694
31.73
53
1414 Degrees Limited
Shareholder Information
30 June 2023
Unquoted equity securities
35,683,063 Options over Ordinary Shares held by 661 holders.
4,085,000 Performance Rights over Ordinary Shares held by 7 holders.
Substantial holders
Shareholders
Shares
% Interest
Robert John Keith Shepherd as trustee for RJK Shepherd & Assoc
SF, John Henry Moss and Wendy Elizabeth Moss (Moss
Retirement Account) and Ammjohn Pty Ltd
15,740,443
6.61%
Dr Kevin Moriarty
16,237,916
6.82%
Voting rights
Unquoted equity securities have no voting rights. The voting rights attached to ordinary shares are set out below:
Ordinary shares
On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each share shall have
one vote.
Restricted Securities
No restricted securities were on issue at 19 September 2023.
There are no other classes of equity securities.
1414 Degrees Ltd
ABN 57 138 803 620
136 Daws Road
Melrose Park SA 5039
E info@1414degrees.com.au
T +61 8 8357 8273
W 1414degrees.com.au