ALCHEMY RESOURCES LIMITED
ABN 17 124 444 122
ANNUAL REPORT
For the year ended 30 June 2021
CONTENTS
CORPORATE DIRECTORY ................................................................................................................................................... 2
CHAIRMAN’S LETTER .......................................................................................................................................................... 3
KEY INVESTMENT HIGHLIGHTS....................................................................................................................................... 5
REVIEW OF ACTIVITIES ....................................................................................................................................................... 6
DIRECTORS’ REPORT ......................................................................................................................................................... 29
AUDITOR’S INDEPENDENCE DECLARATION ........................................................................................................... 41
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2021 ......................................................................................................................... 42
CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2021 ......................................... 43
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 30 JUNE 2021 ......... 44
CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 30 JUNE 2021 ......................... 45
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED
30 JUNE 2021 ....................................................................................................................................................................... 46
DIRECTORS’ DECLARATION............................................................................................................................................ 73
INDEPENDENT AUDITOR’S REVIEW REPORT ........................................................................................................... 74
ADDITIONAL SHAREHOLDER INFORMATION AS AT 10 SEPTEMBER 2021 ................................................. 78
TENEMENT SCHEDULE ..................................................................................................................................................... 80
ANNUAL REPORT 30 JUNE 2021
Page 1 of 81
CORPORATE DIRECTORY
DIRECTORS & MANAGEMENT
Lindsay Dudfield Non-Executive Chairman
Liza Carpene
Anthony Ho
James Wilson
Non-Executive Director
Non-Executive Director
Chief Executive Officer
COMPANY SECRETARIES
Jessamyn Lyons – Joint Company Secretary
Carly Terzanidis – Joint Company Secretary
REGISTERED OFFICE & PRINCIPAL PLACE OF BUSINESS
Suite 8, 8 Clive Street
West Perth WA 6005
Telephone:
Facsimile:
Email:
Web:
+61 (8) 9481 4400
+61 (8) 9481 4404
admin@alchemyresources.com.au
www.alchemyresources.com.au
AUDITORS
BDO Audit (WA) Pty Ltd
38 Station Street
Subiaco WA 6008
BANKERS
National Australia Bank
226 Main Street
Osborne Park WA 6017
SHARE REGISTRY
Automic Group
Level 2, 267 St Georges Terrace
Perth WA 6000
Telephone:
+61 (2) 9698 5414
STOCK EXCHANGE LISTING
The Company is listed on the Australian Securities Exchange Ltd (“ASX”)
Home Exchange: Perth, Western Australia
ALY
ASX Code:
ANNUAL REPORT 30 JUNE 2021
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CHAIRMAN’S LETTER
Dear Fellow Shareholders,
On behalf of the Board of Directors, I am pleased to present the Annual Report of Alchemy Resources
Limited for the year ended 30 June 2021.
Alchemy holds five main projects covering a range of commodities including gold, base metals, nickel
and cobalt, all located in mining friendly parts of Australia and each with the potential to host “company
making” deposits.
Despite COVID-19 related travel restrictions, Alchemy successfully completed multiple drill programs
across our portfolio of tenements in Western Australia and New South Wales, with exploration activities
managed to ensure the well-being and safety of our employees, contractors and local communities.
Several successful drilling programs were undertaken at our 100% owned Karonie Project (WA), with
results extending the zones of mineralisation at our Parmelia Prospect and intercepting high grade
zones at KZ5 and Taupo Prospects which are located immediately along strike of Silver Lake’s Aldiss
Mining Centre. Results from drilling at Parmelia, KZ5 and Taupo were collated resulting in the release
of a maiden inferred resource estimate of 111,110oz at Karonie on 31 August 2021.
Our Bryah Basin our Gold and Base Metals Joint Ventures, also in WA, continued to be advanced at no
cost to Alchemy by partners Superior Gold and Sandfire Resources respectively.
Superior Gold progressed studies and heritage agreements on the Hermes and Hermes South deposits,
evaluating the potential to include the 114,000oz Hermes South deposit as a satellite open pit feed
source for their Plutonic Mine, 65km to the northeast. Production from Hermes South is currently
expected to commence in 2022. Sandfire’s aggressive drilling campaign on our ground along strike of
their DeGrussa copper-gold mine continued during the year with significant aircore and moving loop
electromagnetics completed at the Bulgullan Bore and Horseshoe Lights prospects.
Late 2020 Alchemy completed two deep diamond drill holes designed to test the interpreted extensions
of mineralisation down plunge and along strike at Overflow, one of four projects in NSW comprising
the Lachlan/Cobar Basin Joint Venture with Heron Resources. The Company also undertook a
comprehensive structural and geophysical review of the Melrose Magnetic Anomaly, with drilling
planned for late 2021, subject to requisite approvals. Alchemy has now earned an 80% interest in the
Lachlan JV tenements.
Late 2020 we farewelled Leigh Ryan as our Managing Director, who left to pursue other opportunities,
and in January 2021 we welcomed James Wilson as Alchemy’s Chief Executive Officer. James is a
geologist with a strong mix of technical and capital markets experience and moved swiftly to appoint
key personnel to the team and commence drill programs across the portfolio. On behalf of the Board,
I would like to thank Leigh, James and the rest of the Alchemy team for their efforts during the period.
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CHAIRMAN’S LETTER
The next 12 months promises to be an exciting period for Alchemy shareholders with drill rigs returning
to Karonie, exploration expected to commence in NSW and at our significant Lake Rebecca tenement
package and the potential for gold production at Hermes South late in 2022. We look forward to
reporting to shareholders on our progress as we continue to build the Company.
Lindsay Dudfield
Chairman
ANNUAL REPORT 30 JUNE 2021
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KEY INVESTMENT HIGHLIGHTS
Growth strategy focussed on building a portfolio of quality mineral resources through innovative
exploration and strategic acquisition, with the aim of realising value to Shareholders through the mining
or sale of mineral discoveries.
KARONIE PROJECT (WA) and LAKE REBECCA (WA) – Gold
Quality gold targets close to existing resources and processing infrastructure.
LACHLAN/COBAR BASIN PROJECTS (NSW) – Gold / Base Metals
High grade gold and base metal drill targets within the Overflow and Yellow Mountain Projects.
BRYAH BASIN PROJECT (WA) – Gold / Base Metals
Joint-venture funded exploration for high-grade gold and base metals in a highly prospective
metallogenic province.
CORPORATE
Placement and non-renounceable 1 for 10 entitlement offer completed raising a total of $1,825,787
(before costs).
Appointment of James Wilson as Chief Executive Officer, effective 1 January 2021.
Appointment of Jessamyn Lyons as Company Secretary, effective 3 March 2021.
Appointment of Carly Terzanidis as Joint Company Secretary, effective 23 August 2021.
Enterprise Value of ~$10M; highly leveraged to success.
Strong major Shareholder support.
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REVIEW OF ACTIVITIES
Alchemy Resources Limited (ASX: ALY; “Alchemy” or “the Company”) is an Australian exploration
company focused on growth through the discovery and development of gold, base metal and nickel-
cobalt resources within Australia. The Company has built a significant land package in the Karonie-
Carosue Dam greenstone belt in the Eastern Goldfields region in Western Australia, and has a Joint
Venture Agreement with Heron Resources Ltd (ASX: HRR; “Heron”) where Alchemy has earned an 80%
interest in the Lachlan/Cobar Basin Projects in New South Wales, both well-endowed metal provinces
with significant upside for gold, silver, copper, lead, zinc, nickel and cobalt mineralisation.
The Company also maintains its interest in the Bryah Basin Project in the gold and base metal-rich
Gascoyne region of Western Australia, where farm-in and joint venture partners, Sandfire Resources NL
(ASX: SFR; “Sandfire”), and Billabong Gold Pty Ltd (“Billabong”), a subsidiary of TSX-V listed Superior
Gold Inc. (TSX-V: SGI) (“Superior”), are continuing to advance base metal and gold exploration,
respectively (Figure 1).
Figure 1: Alchemy Resources’ Project Location Map
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REVIEW OF ACTIVITIES
Exploration over the past 12 months focussed on the Karonie Gold Project in Western Australia and the
Overflow Gold and base metals project in New South Wales. This work included a regional structural
mapping review and reverse circulation (RC) drilling at the Taupo, KZ5 and Parmelia prospects along
strike of Silver Lake’s Aldiss Mining Centre and diamond core drilling (DD) at the Overflow Project in
New South Wales.
A significant area of highly prospective greenstones was pegged forming a new project called the Lake
Rebecca Project, centred 80km north of Karonie and strategically located near established resources
and mining infrastructure.
Exploration at the Karonie Project in Western Australia continued with two drilling campaigns completed
during the year. The results highlighted the prospectivity of the Taupo, KZ5 and Parmelia Prospects
which returned high grade gold intercepts which remain open at depth and along strike of all three
zones.
Exploration within the Bryah Basin Joint Venture continued with Sandfire Resources partially completing
an aggressive Aircore (AC) and geophysics campaign along strike of the Horseshoe Lights mine, and
Superior Gold commencing heritage clearance work as well as design and scheduling work for the
Hermes South resource where mining is expected to commence in the first half of 2022.
In NSW, diamond core drilling was completed on the highly prospective Overflow Gold and Base metals
target, confirming the extent of the shear zone and highlighting the structural complexity on the high-
grade shoots.
Alchemy’s strategy for the next 12 months is to:
• Undertake targeted drill programs at the highly prospective Karonie Gold Project with the aim of
delineating significant gold resources.
• Complete ground mapping and structural targeting in the southern and northern Karonie tenements.
• Unlock the gold and base metal potential of the Lachlan/Cobar Projects through systematic
exploration and targeted drilling campaigns with a focus on the Overflow, Melrose and Yellow
Mountain Mine prospects;
• Closely monitor exploration and Hermes South mining activities undertaken by Billabong within the
Bryah Basin Joint Venture;
• Undertake reviews and detailed reporting of Sandfire Resources funded exploration for gold and
base metal deposits within the Bryah Basin Joint Venture;
• Continue to enhance the Company’s position through strategic investment decisions and evaluation
of quality advanced gold and base metal project opportunities throughout Australia.
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REVIEW OF ACTIVITIES
KARONIE PROJECT (WA) (Alchemy 100%)
The Karonie Project now includes twelve exploration licences and three exploration licence
applications covering 1,252km2 of highly prospective mineralised structures within Kurnalpi Terrain
greenstones 100km east of Kalgoorlie (Figure 2). The tenements are located along strike of Silver Lake
Resources (ASX: SLR) Aldiss Mining Centre (reserves/resources of over 585,000oz @ 1.9g/t Au)1, are
within 50km of Silver Lake’s Randall’s processing plant, and cover 38km of the under-explored, gold
endowed Claypan Shear Zone commencing just 12km along strike to the south of Breaker Resources
NL’s (ASX: BRB) Bombora deposit (resource of 1.37Moz @ 1.5g/t Au)2.
Figure 2: Karonie Project tenements, major deposits, prospects and
interpreted major structures over published geology
1 Refer to Silver Lake Resources Limited’s ASX announcement dated 19 August 2020. CP: A. Awan
2 Refer to Breaker Resources Limited’s ASX announcement dated 29 April 2021. CP’s: T. Sanders, A. Barker, N. Fogden.
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REVIEW OF ACTIVITIES
During the year, the Company conducted a structural targeting review of the Karonie tenements which
was undertaken by Model Earth Pty Ltd (Figure 3). The review focussed on generating “camp scale”
prospective areas for follow-up (in addition to existing advanced target areas at Parmelia, KZ5 and
Taupo). The outcome of the study highlighted that Karonie is highly prospective, having regional-scale
flexures on both the Keith Kilkenny and Claypan shear zones and proximity to nearby large scale >1Moz
gold deposits. Five high level targets were identified for further work including Warrior-Gilmore,
Challenger-Esplanade, Manhattan and two new conceptual targets at Karonie West and a new target in
the southern most extent of the Karonie tenement package. Best historic results from Challenger
included 10m at 1.46 g/t gold (from 128m) in ISRC103513 and previous high-grade intercepts from
Esplanade included 1m at 21.35g/t gold (from 133m) in LPRC01813.
Figure 3: Karonie structural targeting review showing structural review targets
3 Refer Alchemy Resources ASX Announcement 24 May 2016
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REVIEW OF ACTIVITIES
Multiple drill programs were conducted during the year at the 100% owned Karonie Gold Project
including the Parmelia, Taupo, KZ5 and Warrior Prospects for a total of 33 holes for 3,852m of RC
drilling. Two drill programs were completed at Parmelia Prospect for a total of 1,415m and follow-up
drill programs were completed at KZ5 for 913m), Taupo for 1,081m and Warrior for 444m.
Figure 4: Karonie Project Prospects location
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REVIEW OF ACTIVITIES
Drilling at the KZ5 Prospect included 9 holes for 913m, targeting the up/down dip and along strike
extension of the zones of existing mineralisation including 26m @ 1.30g/t Au from 125m4. Drilling
intersected variably altered dolerites with zones of sulphides and quartz veining close to the interpreted
strike extension locations. Assay results received from KZ5 indicate the continuity of mineralisation along
strike and at depth. Importantly, mineralisation was intercepted in KZRC104 with assays returning 1m @
15.30g/t Au from 57m5. This hole targeted the up-dip extent of the deep mineralisation observed in
KZD009. In the northern area, mineralisation observed in KZRC103 indicates a potential flexure or offset
towards the north-west beyond historic drill hole KZRC041, which returned 1m @ 6.67g/t Au from 24m5.
Alchemy believes there is significant opportunity to test the structure to the north-west where historic
drilling is both wide spaced and shallow, with most hole depths 10m or less.
Figure 5: KZ5 Prospect Drill Plan
4 Refer to Integra Mining Limited ASX announcement “KZ5 Exploration Update” dated 16 January 2007. CP: C. Cairns
5 Refer Alchemy Resources ASX Announcement 10 August 2021
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REVIEW OF ACTIVITIES
Taupo Prospect is located 2km along strike to the north of the Karonie Main open cut mine. Drilling at
the Taupo included 9 RC holes for 1,081m, targeting infill and extension of the two primary lodes of
mineralisation along strike from previous results including 10m @ 1.8g/t Au (from 68m). Drilling
intercepted zones of altered dolerites, quartz veining and sulphides in proximity to the interpreted strike
extension locations.
RC drilling at Taupo was designed to infill previous drilling and test strike extensions of the existing
mineralisation envelope. Results have confirmed the continuity of the mineralised structure in the
central zone where TARC013 recorded a strong intercept of 4m @ 1.72g/t Au from 123m, including 1m
@ 5.73g/t6 Au from 123m. Mineralisation in the central zone displays a gentle westerly 45°dip and can
be traced up to 150m down dip, based on the limited drill density. Both zones remain open at depth
and along strike to the north. The drilling confirmed two sub-parallel zones of gold mineralisation still
open down dip and along strike to the north and south. Previous drilling along strike is limited to
shallow, wide spaced, vertical AC holes that are not adequate to identify the plunging high-grade gold
shoots that are common in the Aldiss area. Further drilling targeting potential high-grade shoots at
depth is being planned.
Figure 6: Taupo Prospect: Significant intercepts from recent and historic drilling
6 Refer Alchemy Resources ASX Announcement 10 August 2021
7 Refer Alchemy Resources ASX Announcement 9 December 2019
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REVIEW OF ACTIVITIES
Figure 7: Taupo Prospect cross section 6569200mN
RC drilling at Parmelia was planned to infill previous drilling and test strike extensions of the existing
mineralisation envelope. Results from the RC drilling has confirmed the mineralised structure extends
both down dip and along strike to the south with assays ranging from 0.3g/t Au to 0.83g/t Au over
widths from 4m to 20m. PARC015, the southernmost RC hole at Parmelia, has confirmed the mineralised
system extends a further 100m south from the previous intercept of 17m @ 1.05g/t Au observed in
PARC0117. Alchemy believes the Parmelia mineralisation may occur as a series of steeply south plunging
shoots over a strike length which now exceeds 500m in length and this will be tested in follow-up drill
programs.
Two intercepts were received from Warrior, 4m @ 0.66g/t Au from WARC001 and 4m @ 0.38g/t Au8
which were in the transported clays that overlay the basement rock. There were no other significant
assay results to report from basement geology from the four wide spaced RC holes that were drilled to
test the coincident gravity and magnetic highs at the Warrior Prospect. This program is the first program
that has succeeded in penetrating and testing basement geology. The drilling intersected favourable
gold host geology: black shales and fractionated dolerites with silica alteration and sulphide minerals,
which gives reason to pursue with follow up drill programs after more in depth interpretation of the
geology along strike of the recent drilling.
7 Refer Alchemy Resources ASX Announcement 9 December 2020
8 Refer Alchemy Resources ASX Announcement 5 July 2021
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REVIEW OF ACTIVITIES
Figure 8: Parmelia Prospect Drill Plan
The commencement of RAB drilling along the Claypan Shear Zone at Manhattan, Dragon, and Churchill
prospects was delayed due to the restrictions and market uncertainty imposed by the COVID-19
pandemic. The RAB drilling is designed to test folded and/or converging dolerite units interpreted from
detailed aeromagnetic imagery. Drilling is now expected to commence later part of 2021.
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REVIEW OF ACTIVITIES
LAKE REBECCA PROJECT (WA) (Alchemy 100%)
The Lake Rebecca Project includes 11 new exploration licence applications covering 494km2 of Archean
greenstones in the Eastern Goldfields of Western Australia. The Project is located 100km east of
Kalgoorlie in a highly prospective geological setting, covering greenstones, numerous internal granites
and known gold bearing structures (Figure 9). It is located just 10km southeast of Northern Star
Resources’ (ASX: NST) Carosue Dam deposit which hosts resources of 4.6Moz @ 2.0g/t Au9, and 6km
west of Apollo Consolidated Limited’s (ASX: AOP) Rebecca, Duchess and Duke deposits which contain
a combined resource of 1.1Moz @ 1.2g/t Au10
During the year Alchemy successfully won the ballot for two key exploration licence applications
(E28/3035 and E28/3039) which will form part of Alchemy’s Lake Rebecca Project. The applications sit
along strike from Apollo Consolidated (ASX: AOP) and to the east of Northern Star Resources (ASX:
NST) Carosue Dam operations.
Figure 9: Lake Rebecca Project tenements, major deposits, prospects and major structures over published geology
9 Refer to Saracen Mineral Holdings Limited ASX announcement dated 4 August 2020
10 Refer to Apollo Consolidated Limited ASX announcement dated 20 April 2020
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REVIEW OF ACTIVITIES
Native Title Heritage Agreement negotiations and exploration data compilations are underway. The
licences are expected to be granted late-2021.
LACHLAN/COBAR BASIN PROJECTS (NSW) (ALCHEMY 51% - EARNING UP TO 80%)
The Lachlan/Cobar Basin Projects consist of the Overflow and Yellow Mountain Gold-Base Metal
Projects, the Eurow Copper-Gold Project, the Girilambone Copper Project, and the West Lynn and
Woodsreef Nickel-Cobalt Projects, each containing multiple gold and/or base metal and/or nickel-
cobalt-alumina targets, including drill-ready targets at Overflow, Yellow Mountain, and West Lynn.
The Projects represent a strategic exploration project acquisition for Alchemy, with a large (1,055km2)
land package in the underexplored central Lachlan province and Cobar Superbasin. The Projects are
proximal to high profile mining centres including Cobar, Hera/Nymagee, Mineral Hill, Tritton and Parkes
(Figure 10).
During the year Alchemy completed the spending requirement to earn an 80% interest in the
Lachlan/Cobar Basin Projects. Under the terms of the Farm-in agreement Alchemy could earn 80%
interest by spending $2m before 30 May 2021.
Figure 10: Alchemy prospects and other mineral deposits over regional TMI aeromagnetic image
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REVIEW OF ACTIVITIES
Overflow Gold-Base Metal Project
The Overflow Project consists of three exploration licences covering 285km2 located over a 34km long
section of the Gilmore Suture ~20km east of the high-grade Hera/Nymagee deposits (Figure 10). The
licences are located on Ordovician-Devonian metasediments and volcanics which are highly prospective
for epithermal gold and Cobar-style gold and base-metal mineralisation.
The Project is centred on the historic Overflow mining centre, a past producer of gold, silver and lead,
which has been the focus of exploration in the area since mining ceased in 1942. Previous drilling at the
Overflow Mine has returned numerous high-grade gold-silver and base metal intercepts including 18m
@ 2.1g/t Au, 111g/t Ag, 1.1% Zn from 245m, and 3m @ 7.3g/t Au, 43g/t Ag, 4.6% Zn, 4.2% Pb, 0.3% Cu
from 286m from Alchemy’s first diamond drill hole (OFDD001)113 (Figure 12). Mineralisation at Overflow
is shear hosted, shows a vertical polymetallic zonation, and displays chlorite-silica alteration typical of
Hera / Cobar-style mineralisation.
During the year Alchemy completed two deep diamond holes (QFDD003 & QFDD004) totalling 698.6m.
The holes targeted mineralisation down plunge and south of the previous high-grade intercepts and
historic workings.
Figure 11: Overflow long section looking east showing the two completed diamond holes (QFDD003 & 004) in 2020
11 Refer to Alchemy Resources ASX Announcement dated 29 March 2017
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REVIEW OF ACTIVITIES
The two-hole diamond drill program aimed to expand the known extent of gold and base metal
mineralisation down plunge to the south of previous high-grade gold intercepts. The first hole
(OFDD003) intercepted strong shearing, faulting, quartz carbonate veining, and pyrite-sphalerite-
galena mineralisation within altered sediments. Assays from this zone returned 15.8m @ 0.8g/t Au, 30g/t
Ag, 1.4% Zn, 0.7% Pb from 266m, including 1m @ 2.7g/t Au, 22g/t Ag, 1.1% Zn, 0.7% Pb from 271m, and
1.1m @ 4.2g/t Au, 23g/t Ag, 2.5% Zn, 1.5% Pb from 280.7m12 (Figure 11).
The second hole (OFDD004), located a further ~100m down plunge to the south of OFDD003,
intercepted a wide zone of intense shearing, fracturing and fault breccia within altered sediments from
260 - 287m, however only minor quartz veining and sulphides were observed. Assays returned a best
intercept of 2m @ 0.7g/t Au, 5g/t Ag, 0.9% Zn, 0.4% Pb from 284m12 (Figure 11).
The diamond drilling confirmed the extent and significance of the Overflow shear zone, whilst
highlighting the complexity of structural controls on high grade shoots at the prospect. Detailed
relogging of both Alchemy and historic drill core is planned to determine the structural controls and
identify additional drill targets at depth and along strike to the north and south.
Yellow Mountain Gold-Base Metal Project
The Yellow Mountain Project consists of one 93km2 exploration licence located ~10km west of the
historic Mineral Hill deposits. The licence covers a 20km long section of the Gilmore Suture, a crustal
scale structure associated with several gold deposits in the district, including the Cowal gold mine
(current resources 8.6Moz13) owned by Evolution Mining Limited (ASX: EVN) (Figure 10). The Project is
located on Ordovician-Silurian granites, Ordovician metasediments, and Devonian volcanics which are
prospective for VMS, porphyry copper-gold and Cobar-style gold and base-metal mineralisation.
A recent review of the Yellow Mountain open file data identified two highly prospective exploration
targets (Yellow Mountain Mine and Melrose prospects), both structurally connected to the Gilmour
Suture.
Melrose Porphyry Cu-Au Target
Previous specialised analysis completed on magnetite and molybdenite samples from the 12km long
Melrose Magnetite Anomaly (MMA) (Figure 13), confirmed chemical signatures similar to porphyry
Cu-Au mineralisation. Al/Ti and V/Ti ratios within the Melrose magnetite samples are typical of lower
temperature hydrothermal magnetite, similar to those from porphyry Cu-Au systems elsewhere in
Australia and overseas including the Cadia-Ridgeway system and are indicative of an oxidised
mineralising fluid with the potential to develop significant copper-gold mineralisation4.
The rhenium (Re) content of a molybdenite sample from within the MMA was very high (939 ppm
Re)5, which is also a characteristic of molybdenites analysed from numerous other porphyry Cu-Au
systems.
12 Refer alchemy resources ASX Announcement 14 December 2020
13 Refer to Evolution Mining Limited’s ASX announcement “Annual Mineral Resources and Ore Reserves Statement” dated 12 February 2020
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REVIEW OF ACTIVITIES
Rhenium–osmium (Re-Os) age dating completed on the Melrose magnetic anomaly molybdenite
sample returned a model age of 424.7 ± 1.5 Ma14 which is similar to igneous rocks associated with the
Mineral Hill mineralisation just 10km to the east, and similar to Pb model age on sulphides from the
Mineral Hill mine. This implies that the Melrose hydrothermal alteration was formed at a similar time
to the mineralisation at Mineral Hill where past production and current resources and reserves total
460,000oz Au, 36,000t Cu, 1.1Moz Ag, 16,000t Pb and 15,000t Zn14.
Previous drilling within the Melrose alteration zone has focussed on the Fountaindale prospect, a
prominent northeast plunging, 800m wide granodiorite intrusion (plug) modelled as a magnetic low
within the larger Melrose magnetic anomaly (Figures 13 & 14). Six diamond holes and five RC holes all
<190m deep, except for a 458m diamond hole completed in 1968, have been drilled into the
Fountaindale intrusive returning gold intercepts associated with quartz veined sericite altered
granodiorite including14:
o 2m @ 3.1g/t Au from 56m
o 2.5m @ 3.1g/t Au, 1.54% As from 70m
o
1m @ 5.5g/t Au from 150m
o
1m @ 4.5g/t Au from 44m
o 3.3m @ 3.1g/t Au from 73m
o
1m @ 5.0g/t Au from 135m
14 Refer to Alchemy Resources Limited’s ASX announcement “Significant Copper-Gold Targets Identified at Yellow Mountain, NSW” dated 9
June 2020. CP: L. Ryan
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REVIEW OF ACTIVITIES
Figure 12: Melrose (left) and Cadia-Ridgeway (right) magnetic anomalies (same scale).
Figure 13: 3D model of the Melrose alteration anomaly showing the intrusive as a distinct hole in the alteration zone.
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REVIEW OF ACTIVITIES
Alchemy considers the Fountaindale intrusive to be an apophysis off a related potentially mineralised
intrusive at depth, with this deeper intrusive the likely cause of the 12km long magnetite alteration
zone. The Fountaindale intrusive is surrounded by chlorite-epidote-albite-magnetite altered and
brecciated sediments and volcaniclastic rocks that form the Melrose magnetic high and probably
represent hydrothermal recrystallisation associated with buried oxidised I-type intrusions.
Porphyry copper-gold and geochemistry experts are also being consulted to help define drill targets
within this large highly prospective alteration zone.
Yellow Mountain Mine
The open file data research also identified a poorly tested, strong chargeability high centred over the
depth extensions of the Yellow Mountain Mine gold-copper-silver-lead-zinc mineralisation (Figures 15
& 16).
The Yellow Mountain Mine prospect contains strong silica-sericite-pyrite alteration associated with
gold-copper-silver-lead-zinc mineralisation within fine grained clastic sediments and siltstones,
located stratigraphically beneath a highly resistive dacitic volcanic unit.
Historic drilling at the Yellow Mountain Mine Prospect (Figure 14) returned broad zones of gold and
base metal mineralisation including15:
o 52m @ 0.54g/t Au, 0.31% Cu, 35g/t Ag, 1.15% Pb, 1.28% Zn from 14m (PYM011)
o 40m @ 0.49g/t Au, 0.34% Cu, 29g/t Ag, 1.18% Pb, 1.81% Zn from 64m (PYM012)
o 41m @ 0.35g/t Au, 0.23% Cu, 17g/t Ag, 0.85% Pb, 0.94% Zn from 10m (PYM013)
o 78m @ 0.32g/t Au, 25g/t Ag from 57.4m (YD02)
o 66m @ 0.31% Cu, 0.79% Pb, 1.69% Zn from 97.5m (YD02)
o 37m @ 0.28g/t Au, 21g/t Ag from 43.2m (YD05)
o 45m @ 0.24% Cu, 0.58% Pb, 1.07% Zn from 39.6m (YD05)
o
16.5m @ 1.08g/t Au, 0.48% Cu, 52g/t Ag, 2.04% Pb, 3.48% Zn from 198m (YD13)
o 24.4m @ 1.12% Cu, 1.19% Pb, 1.02% Zn from surface (YP05A) (no Au or Ag assays)
Drilling includes massive sulphide intercepts up to 2m thick (YD13), and gold and base metal
mineralisation is interpreted as an exhalative, stratabound VMS system with a structurally controlled
gold mineralisation overprint associated with quartz veins in high strain zones. 3D analysis of the
historic drilling results and the IP data suggest the chargeability high could represent a concentration
of sulphides related to a VMS feeder zone located down plunge of the shallow gold and base metal
drill intercepts (Figure 14).
One deep diamond hole has been designed to test the chargeability high, and one RC hole is planned
to test the down plunge component of the interpreted northeast-plunging gold and base metal
15 Refer to Alchemy Resources Limited’s ASX announcement “Significant Copper-Gold Targets Identified at Yellow Mountain (NSW)” dated 9
June 2020. CP: L. Ryan
ANNUAL REPORT 30 JUNE 2021
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REVIEW OF ACTIVITIES
mineralisation (Figure 14 & 15). Drilling is due to commence as soon as possible, subject to Native Title
and statutory approvals.
Figure 14: Yellow Mountain Mine prospect IP chargeability plan (300m RL)
Figure 15: Yellow Mountain Mine IP chargeability cross section (6408200N)
ANNUAL REPORT 30 JUNE 2021
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REVIEW OF ACTIVITIES
West Lynn Nickel-Cobalt-Alumina Project
EL8631 (West Lynn) is centred 17km northwest of Nyngan, NSW. The Project, which covers an area of
100km2, is contiguous with EL8318 (Girilambone) and forms part of the Alchemy/Heron NSW Farm-In
and Joint Venture Agreement. The licence is located within a belt of ultramafic/mafic rocks that cut
through central NSW, extending from the ACT to the Queensland border and host numerous Ni-Co
(+Sc+Al) deposits such as Sunrise/Syerston (Sunrise Energy Metals Limited – ASX: SRL), Homeville
(Alpha HPA Limited – ASX: A4N), and the Nyngan Scandium deposit (Scandium International Mining
Corp. – TSX: SCY), just 11km southwest of West Lynn (Figure 17).
Figure 16: West Lynn Ni-Co Project, Ni-Co+Sc occurrences, and NSW Serpentinite Belts over state-wide
greyscale TMI aeromagnetic image
No ground work was completed by Alchemy during the year.
Eurow Copper-Gold Project
The Eurow Copper-Gold Project (“Eurow”), located 30km southeast of Parkes (Figure 10), covers 167km2
of Ordovician and Devonian-aged meta-sediments intruded by Silurian and Devonian granites, and
proximal to the intersection of the Narromine-Coolac Fault Zone and the Lachlan Transverse Zone. The
Project area contains the historic Eurow-Vychan copper-gold workings where historic drilling returned
high-grade intercepts of 8m @ 2.94% Cu and 0.85g/t Au from 47m, 3m @ 4.0% Cu and 1.25g/t Au from
73m, and 4.4m @ 1.57% Cu and 0.63g/t Au from 212m below the old workings.
ANNUAL REPORT 30 JUNE 2021
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REVIEW OF ACTIVITIES
Copper-gold mineralisation at Eurow appears to be planar and stratiform with a distinct steep south
plunge, and is associated with semi-massive and breccia zones of pyrite-pyrrhotite-chalcopyrite.
Previous shallow aircore drilling across targets north and south of the historic copper workings was
hampered by thick clay zones and did not reach target depths; this area and the down plunge position
of mineralisation warrant further drill testing.
No ground work was completed by Alchemy during the year.
Girilambone Copper Project
Girilambone comprises one granted tenement covering 129km2, located about 20km east of Aeris
Resources Ltd’s (ASX: AIS) Tritton copper operation on the eastern edge of the Girilambone Basin
(Figure 10). Girilambone is prospective for ‘Besshi-type’ VMS copper-gold mineralisation within mafic
units of the Ordovician Girilambone Group, located along an interpreted VMS trend extending south
from the Girilambone Copper Mine. The Project area is adjacent to copper anomalism along structural
and magnetic trends from the historic Kurrajong copper workings where mineralisation dips east
beneath the Girilambone tenement. Recent drilling beneath the Kurrajong workings has returned high
grade copper and gold intercepts including 17m @ 2.6% Cu, 0.3g/t Au from 753m, 19m @ 2.2% Cu,
0.3g/t Au from 677m and 4.6m @ 5.1% Cu, 0.8g/t Au from 403m 166.
No ground work was completed by Alchemy during the year.
Woodsreef Ni-Co Project
Exploration Licence 8711 is located 35km north of Tamworth, NSW, and covers an area of 281km2 within
the New England Fold Belt. The licence encompasses a 34km long section of the Peel Fault, which is
recognised as a regional thrust system that hosts intrusive serpentinites and separates the Woolomin
Beds and Permian granites to the east from the Tamworth Belt to the west. The principal targets in the
region are vein hosted orogenic copper-gold deposits within silica-carbonate altered serpentinites
located on or adjacent to the Peel Fault, and cobalt, chromite, platinoid and nickel sulphide targets
associated with composite/layered ultramafic intrusives within the licence.
No ground work was completed by Alchemy during the year.
BRYAH BASIN PROJECT (WA) (10-20% ALCHEMY)
Alchemy’s base metal and gold prospective Bryah Basin Project comprises a 488km2 tenement package,
located 130km northeast of Meekatharra, Western Australia. The Project is located along strike and
south-west of Sandfire Resources NL’s (ASX: SFR) high-grade DeGrussa and Monty copper-gold
deposits, and adjacent to Peak Hill where about 1Moz of gold has been mined from several deposits
(Figure 17). Alchemy retains its interests in the Bryah Basin Project through farm-in and joint venture
agreements over the base metal prospective part of the project with Sandfire Resources and over the
gold prospective part of the project with Plutonic gold mine operator Billabong Gold, a wholly-owned
subsidiary of Superior Gold Inc. (TSX-V: SGI). Should an economic base metal or gold discovery be made
by Sandfire or Billabong, Alchemy retains the right to participate as a 20% partner with all costs repaid
from 50% of production profits, an equity position that could deliver significant value to Shareholders.
16 Refer to Aeris Resources Ltd ASX Announcements dated 12 June 2018 and 21 August 2018
ANNUAL REPORT 30 JUNE 2021
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REVIEW OF ACTIVITIES
Alchemy also retains a 1% net smelter royalty over future production from 70,000oz to 90,000oz gold
from the Hermes gold deposit (Figure 18). Hermes has produced ~53,500oz since mining commenced
in 201716 and Superior Gold currently reports a Measured and Indicated Resource (inclusive of Reserves)
of 90,000oz gold (2.0Mt @ 1.4g/t Au), and an Inferred Resource of 160,000oz gold (3.9Mt @ 1.3g/t Au)
at Hermes 17.
Figure 17: Bryah Basin Project – Sandfire Resources JV and Billabong Gold JV areas and gold and base metal prospects
Base Metals Exploration (Sandfire 70-80%)
Sandfire acquired Independence Group NL’s (ASX: IGO) Bryah Basin Project Farm-In Rights in August
2018, including whole and part tenements that cover the base metal prospective areas of Alchemy’s
Bryah Basin Project (red outlines in Figure 17)18. Subsequent to completing almost 130,000m of drilling
and spending over $6M on the Bryah Basin base metal tenements in 2019, Sandfire has earned an 80%
interest in Alchemy’s 100% owned tenements and a 70% interest in the tenements jointly owned by
Alchemy and Jackson Minerals Pty Ltd (a wholly owned subsidiary of Fe Ltd (ASX: FEL)). Alchemy remains
free-carried on further exploration to completion of a Pre-Feasibility Study, and then carried on an
interest-free deferred basis for a further $5M of Definitive Feasibility Study expenditure, with the
deferred amount to be repaid from 50% of Alchemy’s share of profits earned through production.
16 Refer to Superior Gold Inc. Interactive Analyst Centre (company website) accessed 26 August 2020
17 Refer to Superior Gold Inc. TSX-V Announcement dated 7 August 2020
18 Refer to Alchemy Resources ASX Announcement dated 6 August 2018
ANNUAL REPORT 30 JUNE 2021
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REVIEW OF ACTIVITIES
During the year Sandfire completed 365 first-pass AC holes (29,167m) drilled along strike to the
southeast of the Horseshoe Lights copper-gold deposit at the Bulgullan Bore Prospect as part of a first
pass 800x100m aircore drill program. Drilling of the initial 800m x 100m AC programme has intersected
interbedded quartz-feldspar-lithic arenites and siltstones interpreted to be of the ‘’Ravelstone’’
Formation though the central to southern sections of the drill lines. Central sections of the drill pattern
have intersected variably foliated High-Mg basalts of the Narracoota formation, currently interpreted
to be part of a thrust block. Copper values of up to 1,170ppm were recorded from Bullgullan19. Drilling
is currently limited though the northern section of the drill pattern, however, current understanding
suggests these could be sediments of the Bangemall Group. Geological interpretation through the
project area is currently ongoing. Approximately 400 AC holes remain to be drilled as part of the initial
800x100m spaced program. Following this drilling an RC drilling will be designed to follow-up on any
geochemical anomalism observed in the first pass program. A moving loop Electro Magnetic (MLEM)
survey was also completed at Bulgullan Bore during the year.
Figure 18: Sandfire Aircore drilling on Bulgullan Bore Prospect
19 Refer to Alchemy Resources June Quarterly Report - ASX Announcement dated 30 July 2021
ANNUAL REPORT 30 JUNE 2021
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REVIEW OF ACTIVITIES
Gold Exploration (Billabong Gold 70-80%)
Exploration of Alchemy’s tenements that cover the gold prospective part of the Bryah Basin Project
(blue outline in Figure 17) continued under the farm-in and joint venture agreement with Superior Gold’s
subsidiary Billabong Gold. Billabong has now earned 70–80% of Alchemy’s interests in the gold
prospective tenements. Alchemy’s remaining interest is carried on an interest-free deferred basis to
production, with Alchemy to repay the deferred amount at the rate of 50% of its share of free cash flow
from production following commencement of mining.
The Billabong Gold JV contains a mineral resource of 2.2Mt @ 1.6g/t for 114,000oz Au reported in
accordance with the JORC guidelines (2012 Edition) at the Hermes South deposit20. Hermes South is
located approximately 20km south-southwest of the Hermes mining operation, and 65km southwest
of the Plutonic gold mine (Figure 17). The mineralisation remains open at depth and there is excellent
potential for further drilling to expand the area of gold mineralisation and add to the known resource.
Detailed work is ongoing to optimise several potential open pit sources, including the Hermes and
Hermes South Pits, and to finalise resources and scheduling.
The Heritage Survey of the Wilgeena to Hermes proposed haul road was completed during the year.
An additional survey area to the west of the currently proposed haul road was heritage-surveyed to
facilitate re-routing of the proposed haul road around identified Aboriginal Heritage Sites. In addition,
a heritage survey of the Wilgeena mining footprint was carried out. Preliminary Infrastructure design
work has been carried out to provide a footprint for the required heritage surveys, flora and fauna
surveys and potential drilling.
CORPORATE
Entitlement Issue
The Company completed a placement of 66,666,667 ordinary fully paid shares (“Placement Shares”) and
16,666,667 free attaching unlisted options (“Placement Options”) (“Placement”) in August 2020 raising
$1,000,000 (before costs).
The Placement Shares were issued at $0.015 per Share along with a 1 for 4 free attaching Placement
Option exercisable at $0.03 and expiring on 30 September 2022.
A pro-rata non-renounceable 1 for 10 Rights Issue of 55,052,435 ordinary fully paid shares at a price of
$0.015 per share with a 1 for 4 free attaching option exercisable at $0.03 and expiring on 30 September
2022 was successfully completed in September 2020, raising $825,787 (before costs).
Mr Leigh Ryan resigned as Managing Director of the Company effective 31 December 2020. Mr Ryan
joined the Company in January 2017 and played a key role in advancing Alchemy’s projects in both WA
and NSW.
In December 2020 the Company announced that it had appointed Mr James Wilson as Chief Executive
Officer effective 1 January 2021. Mr Wilson is a geologist with more than 15 years hands on experience
in exploration and operational roles, both in Australia and overseas, covering a wide range of resources
including gold, copper, nickel and uranium.
20 Refer to Alchemy Resources Limited’s ASX Announcement dated 8 May 2019 “Hermes South Resource Upgrade Bryah Basin, WA” CP: L.
Ryan, P. Blampain
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REVIEW OF ACTIVITIES
Mr Bernard Crawford resigned as Company Secretary and Chief Financial Officer of the Company
effective 3 March 2021. Ms Jessamyn Lyons was appointed as Company Secretary effective 3 March
2021. Carly Terzanidis joined Jessamyn Lyons as Joint Company Secretary on 23 August 2021.
Competent Person’s Statement
The information in this report that relates to Exploration Results is based on information compiled by Mr James Wilson, who is the
Chief Executive Officer of Alchemy Resources Limited and holds shares and options in the Company. Mr Wilson is a Member of the
Australian Institute of Geoscientists and has sufficient experience of relevance to the styles of mineralisation and the types of deposits
under consideration, and to the activities undertaken, to qualify as a Competent Person as defined in the 2012 Edition of the Joint
Ore Reserves Committee ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’ (‘JORC Code
2012’). Mr Wilson consents to the inclusion in this report of the matters based on his information in the form and context in which it
appears.
The information in this report that relates to Mineral Resources at the West Lynn/Summervale Nickel-Cobalt and Summervale-
Alumina Deposit is based on information compiled by Stephen Godfrey, who is an employee of Resource Evaluation Services Pty Ltd,
a consultant to Alchemy Resources Limited. Mr Godfrey is a Fellow of the Australasian Institute of Mining and Metallurgy and a
member of the Australian Institute of Geoscientists, and has sufficient experience of relevance to the styles of mineralisation and the
types of deposits under consideration, and to the activities undertaken, to qualify as a Competent Person as defined in the 2012
Edition of the Joint Ore Reserves Committee ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore
Reserves’ (‘JORC Code 2012’). Mr Godfrey consents to the inclusion in this report of the matters based on his information in the form
and context in which it appears.
The information in this report that relates to Mineral Resources at the Hermes South Gold Deposit is based on information compiled
by Mr Stephen Hyland, a geological consultant working for Superior Gold Inc. Mr Hyland is a Fellow of The Australasian Institute of
Mining and Metallurgy, and has sufficient experience of relevance to the styles of mineralisation and the types of deposits under
consideration, and to the activities undertaken, to qualify as a Competent Person as defined in the 2012 Edition of the Joint Ore
Reserves Committee ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’ (‘JORC Code 2012’).
Mr Hyland consents to the inclusion in this report of the matters based on his information in the form and context in which it appears.
The Company confirms that it is not aware of any new information or data that materially affects the information included in the
original market announcements and, in the case of estimates of Mineral Resources and Ore Reserves, that all material assumptions
and technical parameters underpinning the estimates in the relevant market announcements continue to apply and have not
materially changed. The Company confirms that the form and context in which the Competent Person’s findings are presented have
not been materially modified from the original market announcements.
Forward Looking Statements
This report may include forward looking statements. Forward looking statements are only predictions and are subject to risks,
uncertainties and assumptions which are outside the control of Alchemy. Actual values, results or events may be materially different
to those expressed or implied in this report. Given these uncertainties, recipients are cautioned not to place reliance on forward looking
statements. Any forward looking statements in this presentation speak only at the date of issue of this presentation. Subject to any
continuing obligations under any applicable law and the ASX Listing Rules, Alchemy does not undertake any obligation to update or
revise any information or any of the forward looking statements in this presentation of any changes in events, conditions or
circumstances on which any such forward looking statement is based.
ANNUAL REPORT 30 JUNE 2021
Page 28 of 81
DIRECTOR’S REPORT
Your Directors present their report on the consolidated entity consisting of Alchemy Resources Limited
(“the Company”) and its subsidiaries (“the Group” or “the Consolidated Entity”) at the end of the year
ended 30 June 2021.
DIRECTORS
The following persons were directors of Alchemy Resources Limited during the whole of the financial
year and up to the date of this report unless noted otherwise:
Lindsay Dudfield, Non-Executive Chairman
Liza Carpene, Non-Executive Director
Anthony Ho, Non-Executive Director
Leigh Ryan, Managing Director (resigned on 31 December 2020)*
* James Wilson, Chief Executive Officer (appointed on 1 January 2021)
PRINCIPAL ACTIVITIES
During the year, the principal activity of the Group was exploration for gold, base metals and cobalt.
During the year, there was no change in the nature of this activity.
FINANCIAL RESULTS
The consolidated loss of the Group after providing for income tax for the year ended 30 June 2021 was
$524,830 (2020: $390,897).
DIVIDENDS
No dividends have been paid or declared since the start of the financial year. No recommendation for
the payment of a dividend has been made by the Directors.
OPERATIONS AND FINANCIAL REVIEW
Information on the operations of the Group and its prospects is set out in the “Review of Activities”
section of this Annual Report.
FINANCIAL
Exploration and evaluation costs totalling $15,040 (2020: $12,333) were written off during the year in
accordance with the Group’s accounting policy.
As at 30 June 2021, the Group had net assets of $7,653,849 (2020: $6,399,808) including cash and cash
equivalents of $924,376 (2020: $873,397).
SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS
Significant changes in the state of affairs of the Group during the financial year were as follows:
The Company completed a placement of 66,666,667 ordinary fully paid shares (“Placement Shares”) and
16,666,667 free attaching unlisted options (“Placement Options”) (“Placement”) in August 2020 raising
$1,000,000 (before costs).
ANNUAL REPORT 30 JUNE 2021
Page 29 of 81
DIRECTOR’S REPORT
The Placement Shares were issued at $0.015 per Share along with a 1 for 4 free attaching Placement
Option exercisable at $0.03 and expiring on 30 September 2022.
A pro-rata non-renounceable 1 for 10 Rights Issue of 55,052,435 ordinary fully paid shares at a price of
$0.015 per share with a 1 for 4 free attaching option exercisable at $0.03 and expiring on 30 September
2022 was successfully completed in September 2020, raising $825,787 (before costs).
There were no other significant changes in the state of affairs of the Group during the financial year.
EVENTS SINCE THE END OF THE FINANCIAL YEAR
Carly Terzanidis joined Jessamyn Lyons as Joint Company Secretary on 23 August 2021.
The impact of the Coronavirus (COVID-19) pandemic is ongoing and while it has not significantly
impacted the Group up to 30 June 2021, it is not practicable to estimate the potential impact, positive
or negative, after the reporting date. The situation is rapidly developing and is dependent on measures
imposed by the Australian Government and other countries, such as maintaining social distancing
requirements, quarantine, travel restrictions and any economic stimulus that may be provided.
There has not arisen in the interval between the end of the financial year and the date of this report any
other item, transaction or event of a material and unusual nature likely, in the opinion of the Directors,
to affect significantly the operations, the results of those operations, or the state of affairs of the Group
in future financial years.
LIKELY DEVELOPMENTS AND EXPECTED RESULTS OF OPERATIONS
The Directors are not aware of any developments that might have a significant effect on the operations
of the Group in subsequent financial years not already disclosed in this report.
ENVIRONMENTAL REGULATION
The Group is subject to significant environmental regulation in respect of its exploration activities.
Tenements in Western Australia and New South Wales are granted subject to adherence to
environmental conditions with strict controls on clearing, including a prohibition on the use of
mechanised equipment or development without the approval of the relevant Government agencies,
and with rehabilitation required on completion of exploration activities. These regulations are controlled
by the Department of Mines, Industry Regulation and Safety (Western Australia) and the Department
of Planning, Industry and Environment (New South Wales).
Alchemy Resources Limited conducts its exploration activities in an environmentally sensitive manner
and the Group is not aware of any breach of statutory conditions or obligations.
Greenhouse gas and energy data reporting requirements
The Directors have considered compliance with the National Greenhouse and Energy Reporting Act
2007 which requires entities to report annual greenhouse gas emissions and energy use. The Directors
have assessed that there are no current reporting requirements for the year ended 30 June 2021,
however reporting requirements may change in the future.
ANNUAL REPORT 30 JUNE 2021
Page 30 of 81
DIRECTOR’S REPORT
INFORMATION ON DIRECTORS & MANAGEMENT
The following information is current as at the date of this report.
L Dudfield, Non-Executive Chairman (appointed Director 25 November 2011, Chairman since 1 June 2017)
Experience and expertise
Mr Dudfield is a qualified geologist with over 40 years’ experience exploring for
gold and base metals in Australia and abroad, including close involvement with
a number of greenfields discoveries. He was a founding director of Jindalee
Resources, Alchemy’s third largest shareholder, and is currently an Executive
Director of Jindalee. Mr Dudfield is a member of the Australasian Institute of
Mining and Metallurgy, the Australian Institute of Geoscientists, the Geological
Society of Australia and the Society of Economic Geologists.
Other current directorships
Executive Director of Jindalee Resources Limited (director since 1996)
Non-Executive Director of Energy Metals Limited (director since 2004)
Former directorships in last 3 years None
Special responsibilities
Member of the Audit Committee
Interests in shares and options
Ordinary Shares – Alchemy Resources Limited
Unlisted Options – Alchemy Resources Limited
69,653,142
1,185,983
L Carpene, Non-Executive Director (appointed 18 March 2015)
Experience and expertise
Ms Carpene has worked in the resources industry for more than 20 years and
has significant experience in acquisitions, corporate administration, HR, legal, IT
and stakeholder relations. Ms Carpene spent five years on the Executive Team
of Northern Star Resources Limited as Company Secretary and Head of
Environment and Social Responsibility ceasing in February 2018.
Prior to Northern Star, Ms Carpene was Company Secretary/CFO for listed
explorers Venturex Resources and Newland Resources, and previously held
various site and Perth based management roles with Great Central Mines,
Normandy Mining, Newmont Australia, Agincourt Resources and Oxiana.
Other current directorships
Non-Executive Director of Mincor Resources NL (appointed 16 April 2018)
Former directorships in last 3 years None
Special responsibilities
Member of the Audit Committee
Interests in shares and options
Ordinary Shares – Alchemy Resources Limited
Unlisted Options – Alchemy Resources Limited
2,500,000
25,000
A Ho, Non-Executive Director (appointed 25 November 2011)
Experience and expertise
Other current directorships
Mr Ho is a Chartered Accountant and a partner in a consulting firm focused
principally on corporate and financial services to listed companies. He has
significant experience in the resource industry, having served as director and
company secretary of companies listed on ASX.
Executive Director of Newfield Resources Limited (from 2011 to 16 April 2021)
Non-Executive Director of Australian Agricultural Projects Australia Limited
(director since 2003)
Non-Executive Director of Mustera Property Group Limited (director since 2014)
Former directorships in last 3 years None
Special responsibilities
Chair of the Audit Committee
Interests in shares and options
Ordinary Shares – Alchemy Resources Limited
Nil
ANNUAL REPORT 30 JUNE 2021
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DIRECTOR’S REPORT
L Ryan, Managing Director (appointed 9 January 2017, resigned on 31 December 2020)
Experience and expertise
Mr Ryan is a qualified geologist with over 30 years of experience in the
exploration and resource industry, specifically focused on project evaluation,
exploration management and executive management roles throughout
Australia and Africa. He has been involved in the discovery and resource
definition of numerous gold and base metal deposits and has successfully
negotiated numerous exploration related corporate transactions.
Mr Ryan was previously the Managing Director of Chrysalis Resources Limited
and Boss Resources Limited, and prior to that was Resolute Mining Limited’s
Group Exploration Manager for Africa and Australia. He has worked extensively
in WA, Queensland, NSW, Zambia, Tanzania, Burkina Faso, Mali, and Cote
d’Ivoire. He is also a member of the Australian Institute of Geoscientists and has
recently completed a graduate certificate in Mineral Economics at the Curtin
School of Business, Western Australia.
Other current directorships
None
Former directorships in last 3 years Non-Executive Director of Peppermint Innovation Limited (formerly Chrysalis
Resources Limited) (September 2014 to July 2020)
Special responsibilities
Managing Director
Interests in shares and options
Ordinary Shares – Alchemy Resources Limited
Unlisted Options – Alchemy Resources Limited
1,375,000
16,031,250
CHIEF EXECUTIVE OFFICER
Mr James Wilson was appointed Chief Executive Officer on 1 January 2021. James is a geologist with
more than 15 years hands on experience in exploration and operational roles, both in Australia and
overseas, covering a wide range of resources including gold, copper, nickel and uranium. James has
spent the past fourteen years working as a metals and mining analyst, with the last five of those years
as Senior Research Analyst - Resources for Argonaut Securities.
James has a Bachelor of Applied Science – Geology and a Graduate Diploma in Financial Analysis and
Valuation and is a Graduate of the Australian Institute of Company Directors.
COMPANY SECRETARIES
Ms Jessamyn Lyons was appointed effective 3 March 2021. She holds a Graduate Diploma in Applied
Corporate Governance and is an Associate Member of Chartered Secretaries Australia. Jessamyn also
holds a Bachelor of Commerce from the University of Western Australia with majors in investment
finance, corporate finance and marketing. Over the past 15 years Jessamyn has held various positions
with Macquarie Bank, UBS Investment Bank (London) and more recently Patersons Securities.
Carly Terzanidis, Corporate Advisor at Everest Corporate Pty Limited, joined Jessamyn Lyons as Joint
Company Secretary on 23 August 2021. Ms Terzanidis is a Chartered Secretary, an Associate of the
Governance Institute of Australia and holds a Bachelor of Commerce from Curtin University with majors
in Accounting and Corporate & Resources Administration.
Mr Bernard Crawford was appointed Company Secretary on 1 December 2010. Mr Crawford is a
Chartered Accountant with over 25 years’ experience in the resources industry in Australia and overseas.
He has held various positions in finance and management with NYSE, TSX and ASX listed companies.
He resigned on 3 March 2021.
ANNUAL REPORT 30 JUNE 2021
Page 32 of 81
DIRECTOR’S REPORT
MEETINGS OF DIRECTORS
The number of meetings of the Company’s Board of Directors and of each Board committee held during
the year ended 30 June 2021, and the numbers of meetings attended by each Director were:
Director
L Dudfield
L Carpene
A Ho
L Ryan1
Board of Directors
A
5
5
4
3
B
5
5
5
3
Audit Committee
A
B
2
2
2
*
2
2
2
*
A = Number of meetings attended
B = Number of meetings held during the time the Director held office or was a member of the committee during the year
* = Not a member of the relevant committee
1 Resigned on 31 December 2020
REMUNERATION REPORT (AUDITED)
The Directors present the Alchemy Resources Limited 2021 remuneration report, outlining key aspects
of the Company’s remuneration policy and framework, and remuneration awarded this year.
The report contains the following sections:
a) Key management personnel covered in this report
b) Remuneration governance and the use of remuneration consultants
c) Executive remuneration policy and framework
d) Relationship between remuneration and the Group’s performance
e) Non-executive director remuneration policy
f) Voting and comments made at the Company’s 2020 Annual General Meeting
g) Details of remuneration
h) Service agreements
i) Details of share-based compensation and bonuses
j)
k) Loans to key management personnel
l) Other transactions with key management personnel
Equity instruments held by key management personnel
a) Key management personnel covered in this report
Non-executive and executive directors:
Name
Position
Non-Executive Chairman
L Dudfield
L Carpene
A Ho
J Wilson
L Ryan
Non-Executive Director
Non-Executive Director
Chief Executive Officer (appointed 1 January 2021)
Managing Director (resigned on 31 December 2020)
b) Remuneration governance and the use of remuneration consultants
The Company does not have a Remuneration Committee. Remuneration matters are handled by
the full Board of the Company. In this respect the Board is responsible for:
•
the over-arching executive remuneration framework;
ANNUAL REPORT 30 JUNE 2021
Page 33 of 81
DIRECTOR’S REPORT
•
•
•
the operation of the incentive plans which apply to executive directors and senior executives
(the executive team), including key performance indicators and performance hurdles;
remuneration levels of executives; and
non-executive director fees.
The objective of the Board is to ensure that remuneration policies and structures are fair and
competitive and aligned with the long-term interests of the Company.
In addition, all matters of remuneration are handled in accordance with the Corporations Act 2001
requirements, especially with regard to related party transactions. That is, none of the Directors
participate in any deliberations regarding their own remuneration or related issues.
Independent external advice is sought from remuneration consultants when required, however no
advice was sought during the year ended 30 June 2021.
c) Executive remuneration policy and framework
In determining executive remuneration, the Board aims to ensure that remuneration practices are:
•
•
•
•
competitive and reasonable, enabling the Company to attract and retain key talent;
aligned to the Company’s strategic and business objectives and the creation of shareholder
value;
transparent and easily understood; and
acceptable to shareholders.
All executives receive consulting fees or a salary, part of which may be taken as superannuation,
and from time to time, options. The Board reviews executive packages annually by reference to the
executive’s performance and comparable information from industry sectors and other listed
companies in similar industries.
All remuneration paid to specified executives is valued at the cost to the Group and expensed.
Options and Performance Rights are valued using a Black-Scholes option pricing model and Monte
Carlo simulations model.
d) Relationship between remuneration and the Group’s performance
Emoluments of Directors are set by reference to payments made by other companies of similar size
and industry, and by reference to the skills and experience of Directors. Fees paid to Non-Executive
Directors are not linked to the performance of the Group. This policy may change once the
exploration phase is complete and the Group is generating revenue. At present the existing
remuneration policy is not impacted by the Group’s performance including earnings and changes
in shareholder wealth (e.g. changes in share price).
The Board has set performance indicators, such as movements in the Company’s share price, for
the determination of the Chief Executive Officer emolument as the Board believes this may
encourage performance which is in the long-term interests of the Company and its shareholders.
The Board has structured its remuneration arrangements in such a way it believes is in the best
interests of building shareholder wealth in the longer term. The Board believes participation in the
Company’s Employee Incentive Scheme motivates key management and executives with the long-
term interests of shareholders. Refer note 22 for more details.
ANNUAL REPORT 30 JUNE 2021
Page 34 of 81
DIRECTOR’S REPORT
e) Non-Executive Director remuneration policy
On appointment to the Board, all Non-Executive Directors enter into a service agreement with the
Company in the form of a letter of appointment. The letter summarises the Board policies and
terms, including remuneration relevant to the office of the director.
The Board policy is to remunerate Non-Executive Directors at commercial market rates for
comparable companies for their time, commitment and responsibilities. Non-Executive Directors
receive a Board fee but do not receive fees for chairing or participating on Board committees.
Board members are allocated superannuation guarantee contributions as required by law, and do
not receive any other retirement benefits. From time to time, some individuals may choose to
sacrifice their salary or consulting fees to increase payments towards superannuation.
The maximum annual aggregate Non-Executive Directors’ fee pool limit is $250,000 and was
approved by shareholders at the Annual General Meeting held on 22 July 2008.
Fees for Non-Executive Directors are not linked to the performance of the Group. Non-Executive
Directors’ remuneration may also include an incentive portion consisting of options, subject to
approval by shareholders.
f) Voting and comments made at the Company’s 2020 Annual General Meeting
Alchemy Resources Limited received more than 99.75% of “yes” votes on its remuneration report
for the 2020 financial year. The Company did not receive any specific feedback at the Annual
General Meeting or throughout the year on its remuneration practices.
g) Details of remuneration
The following table shows details of the remuneration received by the Group’s key management
personnel for the current and previous financial year.
Short-term benefits
Post-
employment
benefits
Salary and
fees
Cash
bonus
Non-
monetary
benefit
Super-
annuation
Share-based
payment
Options and
Performance
Rights
$
$
$
$
$
Total
$
Performance
related
%
Name
2021
Directors and
CEO
L Dudfield
J Wilson1
L Ryan2
L Carpene
A Ho
20,000
100,000
124,309
20,000
19,998
-
-
-
-
-
-
-
-
-
-
-
9,500
9,446
-
-
-
50,485
-
-
-
20,000
159,985
133,755
20,000
19,998
18,946
50,485
353,738
-
31.6
-
-
-
Totals
1 Appointed on 1 January 2021 2 Resigned on 31 December 2020
284,307
-
-
ANNUAL REPORT 30 JUNE 2021
Page 35 of 81
DIRECTOR’S REPORT
Short-term benefits
Post-
employment
benefits
Salary and
fees
Cash
bonus
Non-
monetary
benefit
Super-
annuation
Share-based
payment
Options and
Performance
Rights
$
$
$
$
$
Total
$
Performance
related
%
15,000
156,000
10,000
14,999
195,999
-
-
-
-
-
-
-
-
-
-
-
-
14,820
30,148
-
-
-
-
15,000
200,968
10,000
14,999
14,820
30,148
240,967
-
15.0
-
-
Name
2020
Directors *
L Dudfield
L Ryan
L Carpene
A Ho
Totals
* As announced to the ASX in April 2020, and in response to the uncertainty surrounding the impact of COVID-19, the Company
implemented various health and safety measures and cost saving initiatives. One cost saving initiative being a 20% cut in salaries
and the suspension of non-executive Directors fees from 1 April 2020. Salaries and non-executive Directors fees were restored
with effective 1 July 2020
h) Service agreements
On appointment to the Board, all Directors enter into a service agreement with the Company in
the form of a letter of appointment. The letter summarises the Board policies and terms of
appointment, including remuneration relevant to the office of Director. Remuneration and other
terms of employment for other members of key management personnel are formalised in service
agreements as summarised below.
J Wilson, Chief Executive Officer
Mr Wilson is remunerated pursuant to Mr Wilson’s Executive Services Agreement (CEO Agreement).
The key terms of the CEO Agreement are:
a) Mr Wilson will be paid remuneration package of $200,000 per annum plus statutory
superannuation (capped at $25,000 per annum) on a full-time basis.
b) Either party may terminate the CEO Agreement by providing the other party with three months
written notice or payment in lieu of notice.
c) 7,000,000 unlisted sign-on options, to be issued with an exercise price that is 150% of the
volume weighted average price of the Company’s shares for the five trading days prior to the
commencement date with an expiry date of 31 December 2023. The sign-on options will
become exercisable (vest) twelve months after the commencement date and will otherwise be
issued on terms and conditions in accordance with the Incentive Plan Rules (including that the
sign-on options will lapse if the Executive ceases to be an ‘Eligible Participant’ under the
Incentive Plan Rules).
ANNUAL REPORT 30 JUNE 2021
Page 36 of 81
DIRECTOR’S REPORT
d)
10,000,000 unlisted Performance Rights, issued in three tranches (20%, 40%, 40%) with vesting
dependent upon the satisfaction of specific performance hurdles, including increasing the
Company’s share price and market capitalisation and outperforming peer companies, with a
three-year measurement period ending 31 December 2023. The Performance Rights will
otherwise be issued on terms and conditions in accordance with the Incentive Plan Rules
(including that the Performance Rights will lapse if the Executive ceases to be an ‘Eligible
Participant’ under the Incentive Plan Rules).
i) Details of share-based compensation and bonuses
Options
Options over ordinary shares in Alchemy Resources Limited are granted under the Employee
Incentive Scheme(“Scheme”). Participation in the Scheme and any vesting criteria are at the Board’s
discretion and no individual has a contractual right to participate in the Scheme or to receive any
guaranteed benefits. Any options issued to Directors of the Company are subject to shareholder
approval.
The terms and conditions of each grant of options affecting remuneration in the current or future
reporting periods are set out below.
Option
series
Grant
date
Vesting and
exercise date
Expiry date
Exercise
price
Value per option
at grant date
Total
value
% Vested
18
1 Jan 2021
31 Dec 2021
31 Dec 2023
$0.0252
$0.009
$63,718
0%
The fair value of options at grant date are independently determined using a Black-Scholes option
pricing model that takes into account the exercise price, the term of the option, 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.
Further information on the fair value of share options and assumptions is set out in note 22 to the
financial statements.
Performance Rights
Performance rights in Alchemy Resources Limited are granted under the Employee Incentive
Scheme (“Scheme”). Participation in the Scheme and any vesting criteria are at the Board’s
discretion and no individual has a contractual right to participate in the Scheme or to receive any
guaranteed benefits. Any performance rights issued to Directors of the Company are subject to
shareholder approval.
The terms and conditions of each grant of performance rights affecting remuneration in the current
or future reporting periods are set out below.
Rights
series
1
2
3
Grant date
1 Jan 2021
1 Jan 2021
1 Jan 2021
Vesting and
exercise date
Various
Various
Various
Expiry date
31 Dec 2023
31 Dec 2023
31 Dec 2023
Exercise
price
Value per right
at grant date
Nil
Nil
Nil
$0.009
$0.016
$0.007
Total
value
$35,620
$64,509
$13,196
%
Vested
0%
0%
0%
The fair value of performance rights at grant date are independently determined using a Monte
Carlo stimulation pricing model that takes into account the vesting conditions, the term of the
ANNUAL REPORT 30 JUNE 2021
Page 37 of 81
DIRECTOR’S REPORT
performance rights, 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 performance
right.
Further information on the fair value of performance rights and assumptions is set out in note 22
to the financial statements.
j) Equity instruments held by key management personnel
The following tables detail the number of fully paid ordinary shares, options over ordinary shares
and performance rights in the Company that were held during the financial year by key
management personnel of the Group, including their close family members and entities related to
them.
Options
2021
Directors
L Dudfield
L Carpene
L Ryan
CEO
J Wilson
Opening
balance
(1 July)
Granted as
remuneration
Participation in
entitlement
issue
On
resignation
Balance at
30 June
Vested but
not
exercisable
Vested and
exercisable
Unvested
Max value
yet to vest
-
-
16,000,000
-
-
-
1,185,983
25,000
31,250
1,185,983
25,000
-
(16,031,250)
-
16,000,000
7,000,000
7,000,000
-
1,242,233
-
7,000,000
(16,031,250) 8,210,983
-
-
-
-
-
1,185,983
25,000
-
-
-
-
-
-
-
-
7,000,000 $63,712
1,210,983 7,000,000 $63,712
Performance Rights
2021
CEO
J Wilson
Opening
balance
(1 July)
Granted as
remuneration
Performance
Rights
exercised
Net change
other
Balance at
30 June
Vested but
not
exercisable
Vested and
exercisable
Unvested
Max value
yet to vest
-
-
10,000,000
10,000,000
-
-
-
-
10,000,000
10,000,000
-
-
-
-
10,000,000
$113,325
10,000,000 $113,325
During the year, no ordinary shares in the Company were provided as a result of the exercise of
remuneration of options or performance rights.
Shareholdings
2021
Directors
L Dudfield
L Carpene
L Ryan
CEO
J Wilson
Opening
balance
(1 July)
On
appointment
Participation in
entitlement
issue
On market
acquisition
On
resignation
Balance at
30 June
64,909,200
1,000,000
1,250,000
-
-
-
4,743,942
100,000
125,000
-
1,400,000
-
-
-
(1,375,000)
69,653,142
2,500,000
-
-
67,159,200
1,200,853
1,200,853
-
4,968,942
-
1,400,000
-
(1,375,000)
1,200,853
73,353,995
ANNUAL REPORT 30 JUNE 2021
Page 38 of 81
DIRECTOR’S REPORT
k) Loans to key management personnel
There were no loans to individuals or members of key management personnel during the financial
year or the previous financial year.
l) Other transactions with key management personnel
There were no other transactions with key management personnel during the financial year or the
previous financial year.
END OF REMUNERATION REPORT (AUDITED)
SHARES UNDER OPTION
Unissued ordinary shares of the Company under option at the date of this report are as follows:
Date options granted
11 September 2020
11 December 2019
1 January 2021
Expiry date
30 September 2022
31 December 2023
31 December 2023
Exercise price
$0.03
$0.025
$0.0252
Number under option
33,429,776
250,000
7,000,000
40,679,776
No option holder has any right under the options to participate in any other share issue of the Company
or any other entity.
SHARES ISSUED ON THE EXERCISE OF OPTIONS
There were no shares issued on the exercise of options during the year and up to the date of this report.
CORPORATE GOVERNANCE STATEMENT
The Company’s 2021 Corporate Governance Statement has been released as a separate document and
is located on the Company’s website at http://alchemyresources.com.au/corporate-governance.
PROCEEDINGS ON BEHALF OF THE CONSOLIDATED ENTITY
No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring
proceedings on behalf of the Group, or to intervene in any proceedings to which the Group is a party,
for the purpose of taking responsibility on behalf of the Group for all or part of those proceedings.
INDEMNIFICATION AND INSURANCE OF DIRECTORS AND OFFICERS
During the financial year, the Company paid a premium to insure the Directors and Officers of the
consolidated entity against any liability incurred as a Director or Officer to the extent permitted by the
Corporations Act 2001. The contract of insurance prohibits the disclosure of the nature of the liabilities
covered or the amount of the premium paid.
The Group has not entered into any agreement with its current auditors indemnifying them against
claims by a third party arising from their position as auditor.
ANNUAL REPORT 30 JUNE 2021
Page 39 of 81
DIRECTOR’S REPORT
NON-AUDIT SERVICES
The Company may decide to employ the auditor on assignments additional to their statutory audit
duties where the auditor’s expertise and experience with the Company and/or the Group are important.
Details of the amounts paid or payable to the auditor (BDO Audit (WA) Pty Ltd) for audit and non-audit
services provided during the year are set out in note 17. During the year ended 30 June 2021 no fees
were paid or were payable for non-audit services provided by the auditor of the consolidated entity
(2020: $Nil).
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 on the following page.
Signed in accordance with a resolution of the Directors.
Lindsay Dudfield
Chairman
Perth, 14 September 2021
ANNUAL REPORT 30 JUNE 2021
Page 40 of 81
Tel: +61 8 6382 4600
Fax: +61 8 6382 4601
www.bdo.com.au
38 Station Street
Subiaco, WA 6008
PO Box 700 West Perth WA 6872
Australia
DECLARATION OF INDEPENDENCE BY GLYN O'BRIEN TO THE DIRECTORS OF ALCHEMY RESOURCES
LIMITED
As lead auditor of Alchemy Resources Limited for the year ended 30 June 2021, 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.
This declaration is in respect of Alchemy Resources Limited and the entities it controlled during the
period.
Glyn O'Brien
Director
BDO Audit (WA) Pty Ltd
Perth, 14 September 2021
BDO Audit (WA) Pty Ltd ABN 79 112 284 787 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 (WA) 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.
Page 41 of 81
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER
COMPREHENSIVE INCOME FOR THE YEAR ENDED 30 JUNE 2021
Notes
3
3
3
9
5
Continuing operations
Other income
Corporate expense
Employee expense
Administration expense
Exploration expenditure written off
Loss from continuing operations before income tax
Income tax benefit
Loss after income tax for the year attributable to the
owners of Alchemy Resources Limited
Other comprehensive income
Other comprehensive income for the year (net of tax)
Total comprehensive loss for the year attributable to the
owners of Alchemy Resources Limited
CONSOLIDATED
2021
$
2020
$
21,889
67,885
(196,604)
(224,098)
(110,977)
(15,040)
(166,681)
(176,202)
(103,666)
(12,233)
(524,830)
(390,897)
-
-
(524,830)
(390,897)
-
-
-
-
(524,830)
(390,897)
Cents
per share
Cents
per share
Loss per share attributable to the owners of Alchemy
Resources Limited
Basic loss per share
Diluted loss per share
16
16
0.08
N/A
0.07
N/A
This Consolidated Statement of Profit or Loss and Other Comprehensive Income should be read in conjunction with the
accompanying notes.
ANNUAL REPORT 30 JUNE 2021
Page 42 of 81
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2021
ASSETS
Current Assets
Cash and cash equivalents
Trade and other receivables
Other current assets
Total Current Assets
Non-Current Assets
Exploration and evaluation
Property, plant and equipment
Total Non-Current Assets
TOTAL ASSETS
LIABILITIES
Current Liabilities
Trade and other payables
Provisions
Total Current Liabilities
TOTAL LIABILITIES
NET ASSETS
EQUITY
Contributed equity
Reserves
Accumulated losses
TOTAL EQUITY
Notes
CONSOLIDATED
2021
$
2020
$
6
7
8
9
11
12
13
14
15
924,376
47,113
14,861
986,350
6,822,841
-
6,822,841
873,397
54,637
12,088
940,122
5,687,452
3,521
5,690,973
7,809,191
6,631,095
129,794
25,548
155,342
155,342
205,082
26,205
231,287
231,287
7,653,849
6,399,808
35,394,645
76,835
33,690,859
171,600
(27,817,631)
(27,462,651)
7,653,849
6,399,808
This Consolidated Statement of Financial Position should be read in conjunction with the accompanying notes.
ANNUAL REPORT 30 JUNE 2021
Page 43 of 81
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2021
At 1 July 2019
Loss for the year
Other comprehensive income
Total comprehensive loss for the year, net of
tax
Transactions with owners in their capacity as
owners
Issue of shares
Share issue costs
ATTRIBUTABLE TO EQUITY HOLDERS OF THE ENTITY
Issued
capital
$
Option
reserves
Accumulated
losses
$
$
Total
equity
$
32,404,105
134,452
(27,071,754)
5,466,803
-
-
-
1,321,258
(34,504)
-
-
-
-
-
(390,897)
(390,897)
-
-
(390,897)
(390,897)
-
-
-
1,321,258
(34,504)
37,148
Fair value of options issued
-
37,148
At 30 June 2020
33,690,859
171,600
(27,462,651)
6,399,808
At 1 July 2020
Loss for the year
Other comprehensive income
Total comprehensive loss for the year, net of
tax
Transactions with owners in their capacity as
owners
Issue of shares
Share issue costs
Issue of broker options
Share-based payments
Expiry of options
At 30 June 2021
33,690,859
171,600
(27,462,651)
6,399,808
-
-
-
1,825,787
(97,401)
(24,600)
-
-
-
-
-
-
-
24,600
50,485
(524,830)
(524,830)
-
-
(524,830)
(524,830)
-
-
-
-
1,825,787
(97,401)
-
50,485
-
(169,850)
169,850
35,394,645
76,835
(27,817,631)
7,653,849
This Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying notes.
ANNUAL REPORT 30 JUNE 2021
Page 44 of 81
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2021
CASH FLOWS FROM OPERATING ACTIVITIES
Payments to suppliers and employees
Interest received
Government grant received
CONSOLIDATED
2021
$
2020
$
Notes
(471,356)
(432,856)
6,778
36,062
9,907
23,855
NET CASH FLOWS USED IN OPERATING ACTIVITIES
23
(428,516)
(399,094)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property, plant and equipment
Payments for exploration assets
NET CASH FLOWS USED IN INVESTING ACTIVITIES
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issue of shares
Share issue costs
NET CASH FLOWS FROM FINANCING ACTIVITIES
13
13
Net increase in cash and cash equivalents
Cash and cash equivalents at beginning of the year
CASH AND CASH EQUIVALENTS AT END OF THE YEAR
6
(4,527)
(1,244,364)
(1,248,891)
1,825,787
(97,401)
1,728,386
50,979
873,397
924,376
(2,307)
(545,842)
(548,149)
1,321,258
(34,504)
1,286,754
339,511
533,886
873,397
This Consolidated Statement of Cash Flows should be read in conjunction with the accompanying notes.
ANNUAL REPORT 30 JUNE 2021
Page 45 of 81
PAGENOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2021
NOTE 1: CORPORATE INFORMATION
The consolidated financial report of Alchemy Resources Limited for the year ended 30 June 2021 was
authorised for issue in accordance with a resolution of the Directors on 14 September 2021.
Alchemy Resources Limited is a for-profit company incorporated in Australia and limited by shares
which are publicly quoted on the Australian Securities Exchange. The nature of the operation and
principal activities of the consolidated entity are described in the attached Directors’ Report.
The principal accounting policies adopted in the preparation of these consolidated financial statements
are set out below and have been applied consistently to all periods presented in the consolidated
financial statements and by all entities in the consolidated entity.
NOTE 2: STATEMENT OF COMPLIANCE
These general purpose financial statements have been prepared in accordance with Australian
Accounting Standards, other authoritative pronouncements of the Australian Accounting Standards
Board, Urgent Issues Group Interpretations and the Corporations Act 2001.
Compliance with IFRS
The consolidated financial statements of Alchemy Resources Limited also comply with International
Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB).
New and amended accounting standards and interpretations adopted by the Group
The following standard and interpretation relevant to the operations of the Group and effective from
1 July 2020. The below did not have any impact on the current period or any prior period but may
impact future periods.
New or revised requirement
AASB 2018-6: Amendments to Australian Accounting Standards – Definition of a
Business
The Standard amends the definition of a business in AASB 3 Business Combinations. The
amendments clarify the minimum requirements for a business, remove the assessment
of whether market participants are capable of replacing missing elements, add guidance
to help entities assess whether an acquired process is substantive, narrow the definitions
of a business and of outputs, and introduce an optional fair value concentration test.
Application
date of
standard
Application
date for
Group
1 Jan 2020
1 Jul 2020
ANNUAL REPORT 30 JUNE 2021
Page 46 of 81
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 2: STATEMENT OF COMPLIANCE (continued)
New or revised requirement
AASB 1018-7: Amendments to Australian Accounting Standards – Definition of
Material
This Standard amends AASB 101 Presentation of Financial Statements and AAS 108
Accounting Policies, Changes in Accounting Estimates and Errors to align the definition
of ‘material’ across the standards and to clarify certain aspects of the definition. The
amendments clarify that materiality will depend on the nature or magnitude of
information. An entity will need to assess whether the information, either individually or
in combination with other information, is material in the context of the financial
statements. A misstatement of information is material if it could reasonably be expected
to influence decisions made by the primary users.
Application
date of
standard
Application
date for
Group
1 Jan 2020
1 Jul 2020
New accounting standards and interpretations
The following new and amended accounting standards and interpretations relevant to the operations
of the Group have been published but are not mandatory for the current financial year.
The following amendments are effective for the period beginning 1 January 2022:
• Onerous Contracts – Cost of Fulfilling a Contract (Amendments to IAS 37);
• Property, Plant and Equipment: Proceeds before Intended Use (Amendments to IAS 16);
• Annual Improvements to IFRS Standards 2018-2020 (Amendments to IFRS 1, IFRS 9, IFRS 16 and IAS
F41); and
• References to Conceptual Framework (Amendments to IFRS 3).
In January 2020, the IASB issued amendments to IAS 1, which clarify the criteria used to determine
whether liabilities are classified as current or non-current. These amendments clarify that current or
non-current classification is based on whether an entity has a right at the end of the reporting period
to defer settlement of the liability for at least twelve months after the reporting period. The amendments
also clarify that ‘settlement’ includes the transfer of cash, goods, services, or equity instruments unless
the obligation to transfer equity instruments arises from a conversion feature classified as an equity
instrument separately from the liability component of a compound financial instrument. The
amendments were originally effective for annual reporting periods beginning on or after 1 January 2022.
However, in May 2020, the effective date was deferred to annual reporting periods beginning on or
after 1 January 2023.
The Group is currently assessing the impact of these new accounting standards and amendments. The
Group does not believe that the amendments to IAS 1 will have a significant impact on the classification
of its liabilities.
ANNUAL REPORT 30 JUNE 2021
Page 47 of 81
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
a) Basis of measurement
Historical Cost Convention
These consolidated financial statements have been prepared under the historical cost convention,
except where stated.
Critical Accounting Estimates
The preparation of consolidated financial statements requires the use of certain critical accounting
estimates. It also requires management to exercise its judgement in the process of applying the
Group’s accounting policies. The areas involving a higher degree of judgement or complexity, or
areas where assumptions and estimates are significant to the consolidated financial statements, are
disclosed where appropriate.
b) Going Concern
These consolidated financial statements have been prepared on the going concern basis, which
contemplates continuity of normal business activities and the realisation of assets and the
settlement of liabilities in the ordinary course of business.
At 30 June 2021, the Group had a cash position of $924,376 (2020: $873,397) and a working capital
balance of $831,008 (2020: $708,835). For the year ended 30 June 2021, the Group recorded a loss
of $524,830 (2020: $390,897) and had net cash outflows from operating and investing activities of
$1,677,407 (2020: $947,243).
The Group’s cash flow forecast to 30 September 2022 indicates that the Group will need to raise
additional funds to meet expenditure commitments, its business plan and its current level of
corporate overheads to continue as a going concern. As a result there exists a material uncertainty
as to whether the Group will be able to continue as a going concern.
To address the future funding requirements of the Group, the Directors have:
• developed a business plan that provides encouragement for investors to invest; and
• continued their focus on maintaining an appropriate level of corporate overheads in line with the
Group’s available cash resources.
The Directors are confident that the Company will be able to complete a fund raising and Rights
Issue to meet the Group’s funding requirements for the forecast period ending 30 September 2022.
The Directors therefore believe that it is appropriate to prepare the 30 June 2021 financial
statements on a going concern basis.
In the event that the Company is not able to successfully complete the fund raising referred to
above, it may need to realise their assets and extinguish their liabilities other than in the normal
course of business and at the amounts different to those stated in the financial statements. The
financial statements do not include adjustments relating to the recoverability and classification of
recorded asset amounts, nor to the amounts and classification of liabilities that might be necessary
should the Company and the Group not continue as a going concern.
ANNUAL REPORT 30 JUNE 2021
Page 48 of 81
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
c) COVID-19
The impact of the Coronavirus (COVID-19) pandemic is ongoing and while it has impacted the
exploration activities in New South Wales up to 30 June 2021, it is not practicable to estimate the
potential impact, positive or negative, after the reporting date. The situation is rapidly developing
and is dependent on measures imposed by the Australian Government and other countries, such
as maintaining social distancing requirements, quarantine, travel restrictions and any economic
stimulus that may be provided.
d) Principles of consolidation
Subsidiaries
The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of the
Company as at 30 June 2021 and the results of all subsidiaries for the year then ended. The
Company and its subsidiaries together are referred to in this financial report as the Group or the
consolidated entity.
Subsidiaries are all entities (including structured entities) over which the Group has control. The
Group controls an entity when the Group is exposed to, or has rights to, variable returns from its
investment with the entity and has the ability to affect those returns through its power to direct the
activities of the entity.
The acquisition method of accounting is used to account for business combinations by the Group.
Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They
are de-consolidated from the date that control ceases.
Intercompany 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 shown separately in the
consolidated statement of profit or loss and other comprehensive income, consolidated statement
of financial position and the consolidated statement of changes in equity respectively.
e) Critical accounting judgements and key sources of estimation uncertainty
The application of accounting policies requires the use of judgments, estimates and assumptions
about carrying values of assets and liabilities that are not readily apparent from other sources. The
estimates and associated assumptions are based on historical experience and other factors that are
considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions are
recognised in the period in which the estimate is revised if it affects only that period, or in the
period of the revision and future periods if the revision affects both current and future periods.
f) Functional and presentation currency
The consolidated financial statements are presented in Australian dollars, which is the Group’s
functional and presentation currency.
ANNUAL REPORT 30 JUNE 2021
Page 49 of 81
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
g) Leases
Leases in which a significant portion of the risks and rewards of ownership are not transferred to
the Group as lessee are classified as operating leases. Payments made under operating leases (net
of any incentives received from the lessor) are charged to profit or loss as incurred over the period
of the lease.
Leases in which a significant portion of the risks and rewards of ownership are transferred to the
Group as lessee are classified as finance leases. At the commencement date of a lease, the Group
recognises a liability to make lease payments (i.e. the lease liability) and an asset representing the
right to use the underlying asset during the lease term (i.e. the right-of-use asset). The Group
separately recognises the interest expense on the lease liability and the depreciation expense on
the right-of-use asset.
NOTE 3: REVENUE AND EXPENSES
Other income
Interest
Government grant
Other
Total other income
Expenses
Employee expense
Employee benefit and director compensation expense
Expense of share-based payments (note 22)
Other employee expenses
Total employee expense
Administration expense
Depreciation
Occupancy and occupancy outgoings
Insurance
Other administration expenses
Total administration expense
CONSOLIDATED
2021
$
2020
$
8,918
-
12,971
21,889
161,756
50,485
11,858
224,098
8,048
46,140
23,113
33,676
10,089
55,848
1,948
67,885
135,917
37,148
3,137
176,202
1,378
53,527
27,871
20,890
110,977
103,666
Revenue is recognised at an amount that reflects the consideration to which the Group expects to be
entitled to in exchange for transferring services to a customer. Revenue and expenses are recognised
on an accruals basis.
Interest income is recognised on a time proportion basis using the effective interest method.
ANNUAL REPORT 30 JUNE 2021
Page 50 of 81
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 4: SEGMENT INFORMATION
Operating segments are reported in a manner consistent with the internal reporting provided to the
chief operating decision maker. The chief operating decision maker, who is responsible for allocating
resources and assessing performance of the operating segments, has been identified as the Board of
Directors of Alchemy Resources Limited.
The Group operates in one geographical segment, being Australia and in one operating category, being
mineral exploration. Therefore, information reported to the chief operating decision maker (the Board
of Alchemy Resources Limited) for the purposes of resource allocation and performance assessment is
focused on mineral exploration within Australia.
NOTE 5: INCOME TAX
Major components of income tax expense are as follows:
Consolidated Statement of Profit or Loss and
Other Comprehensive Income
Current income tax
At the rate of 30% (2020: 30%)
Current income tax charge
Deferred income tax
Relating to origination and reversal of temporary differences
Utilisation of prior year tax losses
Income tax expense/(benefit) reported in the Consolidated
Statement of Profit or Loss and Other Comprehensive Income
CONSOLIDATED
2021
$
2020
$
-
-
-
-
-
-
-
-
-
-
A reconciliation of income tax expense/(benefit) applicable to accounting profit/(loss) before income
tax at the statutory income tax rate to income tax expense/(benefit) at the Company’s effective income
tax is as follows:
ANNUAL REPORT 30 JUNE 2021
Page 51 of 81
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 5: INCOME TAX (Continued)
Accounting loss from continuing operations before income tax
At the statutory income tax rate of 30% (2020: 30%)
Add:
- Non-assessable income
- Non-deductible expenses
- Capital raising costs
- Other deductible expenses
- Share-based payment
- Tax loss not brought to account as a deferred tax asset
CONSOLIDATED
2021
$
2020
$
(524,830)
(157,449)
(390,897)
(117,269)
-
1,645
(9,646)
(8,147)
15,146
158,451
(16,754)
1,478
(5,431)
(2,013)
11,144
128,845
Income tax expense/(benefit) reported in the Consolidated
Statement of Profit or Loss and Other Comprehensive Income
-
-
The income tax expense or benefit for the period is the tax payable on the current period’s taxable
income based on the applicable income tax rate, adjusted by changes in deferred tax assets and
liabilities attributable to temporary differences and to unused tax losses.
The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted
at the end of the reporting period. Management periodically evaluates positions taken in tax returns
with respect to situations in which applicable tax regulations are subject to interpretation. It establishes
provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.
ANNUAL REPORT 30 JUNE 2021
Page 52 of 81
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 5: INCOME TAX (Continued)
Deferred income tax
Recognised on the Consolidated Statement of Financial Position
Deferred income tax at the end of the reporting period relates to the
following:
Deferred income tax liabilities
- Capitalised expenditure deductible for tax purposes
- Trade and other receivables
Deferred income tax assets
- Trade and other payables
- Employee benefits
- Capitalised expenditure non-deductible for tax purposes
- Tax losses available to offset DTL
Net deferred tax asset/(liability)
Tax consolidation
CONSOLIDATED
2021
$
2020
$
1,954,826
4,834
1,614,210
3,681
1,959,660
1,617,891
(6,804)
(7,664)
(23,837)
(1,921,355)
-
(7,569)
(7,809)
(13,830)
(1,588,683)
-
The Company and its 100% owned controlled entities have formed a tax consolidated group. The head
entity of the tax consolidated group is Alchemy Resources Limited.
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.
At 30 June 2021, Alchemy Resources Limited had $32,845,550 (2020: $31,746,581) of tax losses that are
available indefinitely for offset against future taxable profits subject to satisfaction of the loss tests. No
deferred tax asset has been recognised in the Consolidated Statement of Financial Position in respect
of the amount of either these losses or other deferred tax expenses. Should the Company not satisfy
the Continuity of Ownership Test, the Company will be able to utilise the losses to the extent that it
satisfies the Same Business Test.
ANNUAL REPORT 30 JUNE 2021
Page 53 of 81
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 6: CASH AND CASH EQUIVALENTS
Cash at bank and on hand
Deposits at call
CONSOLIDATED
2021
$
2020
$
907,876
16,500
924,376
256,897
616,500
873,397
Cash and cash equivalents include cash on hand, deposits held at call with financial institutions, other
short-term, highly liquid investments with original maturities of six months or less that are readily
convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.
The weighted average interest rate for the year was 0.51% (2020: 0.85%).
The Group’s exposure to interest rate risk is set out in note 21. The maximum exposure to credit risk at
the end of the reporting period is the carrying amount of each class of cash and cash equivalents
mentioned above.
NOTE 7: TRADE AND OTHER RECEIVABLES
Current
GST receivable
Other
CONSOLIDATED
2021
$
2020
$
45,033
2,080
47,113
16,327
38,310
54,637
Trade receivables are normally due for settlement within 30 days. They are presented as current assets
unless collection is not expected for more than 12 months after the reporting date.
Trade and other receivables are recognised at amortised cost using the effective interest rate method,
less any allowance for expected credit losses.
The Group assesses at each balance date whether there is objective evidence that a financial asset or
group of financial assets is impaired. For trade and other receivables, the Group applies the simplified
approach permitted by AASB 9 to determine any allowances for expected credit losses, which requires
expected lifetime losses to be recognised from initial recognition of the receivables. The expected credit
losses on these financial assets are estimated using a provision matrix based on the Group’s historical
credit loss experience. The amounts held in trade and other receivables do not contain impaired assets
and are not past due. Based on the credit history of these trade and other receivables, it is expected
that the amounts will be received when due.
The Group’s financial risk management objectives and policies are set out in note 21.
Due to the short-term nature of these receivables their carrying value is assumed to approximate their
fair value.
ANNUAL REPORT 30 JUNE 2021
Page 54 of 81
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 8: OTHER CURRENT ASSETS
Prepayments
NOTE 9: EXPLORATION AND EVALUATION
Opening balance
Exploration expenditure incurred during the year
Exploration expenditure written off
Closing balance
CONSOLIDATED
2021
$
14,861
14,861
2020
$
12,088
12,088
CONSOLIDATED
2021
$
2020
$
5,678,452
1,159,429
(15,040)
6,822,841
5,105,234
594,451
(12,233)
5,687,452
Exploration and evaluation expenditure, including the costs of acquiring licences and permits, are
capitalised as exploration and evaluation assets on an area of interest basis. Costs incurred before the
Group has obtained the legal rights to explore an area are recognised in the Consolidated Statement
of Profit or Loss and Other Comprehensive Income.
Exploration and evaluation assets are only recognised if the rights of the area of interest are current
and either:
i) the expenditures are expected to be recouped through successful development and exploitation or
from sale of the area of interest; or
ii) activities in the area of interest have not at the reporting date reached a stage which permits a
reasonable assessment of the existence or otherwise of economically recoverable reserves, and
active and significant operations in, or in relation to, the area of interest are continuing.
Exploration and evaluation assets are assessed for impairment if sufficient data exists to determine
technical feasibility and commercial viability, and facts and circumstances suggest that the carrying
amount exceeds the recoverable amount. For the purposes of impairment testing, exploration and
evaluation assets are allocated to cash-generating units to which the exploration activity relates. The
cash generating unit shall not be larger than the area of interest.
Once the technical feasibility and commercial viability of the extraction of minerals in an area of interest
are demonstrable, exploration and evaluation assets attributable to that area of interest are first tested
for impairment and then reclassified to mineral property and development assets within property, plant
and equipment.
When an area of interest is abandoned or the directors decide that it is not commercial, any
accumulated costs in respect of that area are written off in the financial period the decision is made.
ANNUAL REPORT 30 JUNE 2021
Page 55 of 81
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 9: EXPLORATION AND EVALUATION (Continued)
Significant estimate and judgement
There is some subjectivity involved in the carry forward of capitalised exploration and evaluation
expenditure or, where appropriate, the write off to the Consolidated Statement of Profit or Loss and
Other Comprehensive Income, however management give due consideration to areas of interest on a
regular basis and are confident that decisions to either write off or carry forward such expenditure fairly
reflect the prevailing situation.
NOTE 10: SUBSIDIARIES
Details of the Company’s subsidiaries are as follows:
Subsidiary
Principal
activity
Country of
incorporation
Alchemy Resources (Murchison) Pty Ltd
Alchemy Resources (Three Rivers) Pty Ltd
Goldtribe Corporation Pty Ltd
Alchemy Resources (NSW) Pty Ltd
Exploration
Exploration
Exploration
Exploration
Australia
Australia
Australia
Australia
Proportion of ownership
2021
100%
100%
100%
100%
2020
100%
100%
100%
100%
NOTE 11: TRADE AND OTHER PAYABLES
Trade creditors
Other creditors and accruals
NOTE 12: PROVISIONS
Current
Employee benefits
Short–term obligations
CONSOLIDATED
2021
$
2020
$
73,493
56,301
129,794
165,049
40,033
205,082
CONSOLIDATED
2021
$
2020
$
25,548
26,205
Liabilities for wages and salaries, including non-monetary benefits and annual leave expected to be
settled within 12 months, are recognised in respect of employees’ services up to the end of the reporting
period and are measured at the amounts expected to be paid when the liabilities are settled. The liability
for annual leave is recognised in the provision for employee benefits. All other short-term employee
benefit obligations are presented as payables.
The obligations are presented as current liabilities in the Consolidated Statement of Financial Position
of the Group.
ANNUAL REPORT 30 JUNE 2021
Page 56 of 81
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 13: CONTRIBUTED EQUITY
a) Share capital
Ordinary shares fully paid
35,394,645
33,690,859
b) Movements in ordinary shares on issue
CONSOLIDATED
2021
$
2020
$
Balance at 1 July 2019
Non-renounceable issue to shareholders (1)
Share issue costs
Balance at 30 June 2020
Placement (2)
Non-renounceable issue to shareholders (3)
Share issue costs
Balance at 30 June 2021
CONSOLIDATED
Number
$
440,419,481
32,404,105
110,104,870
1,321,258
-
(34,504)
550,524,351
33,690,859
66,666,667
55,052,435
-
1,000,000
825,787
(122,001)
672,243,453
35,394,645
(1) On 16 September 2019 the Company completed the issue of 110,104,870 new Shares pursuant to a pro-
rata non-renounceable entitlement and shortfall offer (“Issue”) to eligible shareholders of 1 new Share for
every 4 existing Shares held at an issue price of $0.012 per share.
(2) In August 2020 the Company completed a Placement with the issue of 66,666,667 new Shares at an issue
price of $0.015 per share; the issue of 16,666,667 free attaching options (on the basis of one option for
every four shares subscribed) exercisable at $0.03 and expiring on 30 September 2022 (Placement
Options) and the issue of 3,000,000 Broker Options on the same terms and conditions as the Placement
Options.
(3) In September 2020 the Company completed the issue of 55,052,435 new Shares pursuant to a pro-rata
non-renounceable entitlement and shortfall offer of 1 new Share for every 10 existing Shares held at an
issue price of $0.015 per share together with the issue of 13,763,109 free attaching options (on the basis
of one option for every four shares subscribed) exercisable at $0.03 and expiring on 30 September 2022.
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. Ordinary shares
have the right to receive dividends as declared, and in the event of winding up the Company, to
participate in the proceeds from the sale of all surplus assets in proportion to the number of and
amounts paid upon on shares held. Ordinary shares entitle their holder to one vote, either in person
or by proxy, at a meeting of the Company.
ANNUAL REPORT 30 JUNE 2021
Page 57 of 81
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 13: CONTRIBUTED EQUITY (continued)
c) Movements in options on issue
Balance at beginning of the financial year
Options issued (1)
Options granted (2)
Options expired
CONSOLIDATED
2021
Number
2020
Number
27,000,000
33,429,776
7,000,000
(26,750,000)
22,000,000
-
5,000,000
-
Balance at end of the financial year
40,679,776
27,000,000
(1) Options issued pursuant to the Placement and pro-rata non-renounceable entitlement and
shortfall offer, exercisable at $0.03 and expiring on 30 September 2022.
(2) Options granted to CEO, James Wilson as sign-on bonus, exercisable at $0.0252 and expiring
on 31 December 2023. The options vest on 31 December 2021.
d) Movements in performance rights on issue
Balance at beginning of the financial year
Performance rights granted (1)
Balance at end of the financial year
CONSOLIDATED
2021
Number
2020
Number
-
10,000,000
10,000,000
-
-
-
(1) Performance Rights granted to CEO, James Wilson as Long-Term Incentives.
NOTE 14: RESERVES
Options reserve
Opening balance
Option expense
Performance rights expense
Expiry of options (note 15)
Balance at the end of the financial year
CONSOLIDATED
2021
$
2020
$
171,600
56,456
18,629
(169,850)
76,835
134,452
37,148
-
-
171,600
The options reserve is used to recognise the fair value of options and performance rights issued to
directors, employees and contractors.
ANNUAL REPORT 30 JUNE 2021
Page 58 of 81
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 15: ACCUMULATED LOSSES
Balance at the beginning of the financial year
Net loss attributable to members
Lapsed options transferred from option reserve (note 14)
Balance at the end of the financial year
NOTE 16: LOSS PER SHARE
Basic loss per share
Diluted loss per share
CONSOLIDATED
2021
$
2020
$
(27,462,651)
(524,830)
169,850
(27,071,754)
(390,897)
-
(27,817,631)
(27,462,651)
CONSOLIDATED
2021
Cents
0.08
N/A
2020
Cents
0.07
N/A
The following reflects the income and share data used in the calculations of basic and diluted loss per
share:
CONSOLIDATED
2021
$
2020
$
Losses used in calculating basic and diluted loss per share
(524,830)
(390,897)
Weighted average number of ordinary shares used in
calculating basic and diluted loss per share
Basic loss per share
CONSOLIDATED
2021
Number
2020
Number
672,243,453
527,059,379
Basic loss per share is calculated by dividing the loss attributable to owners of the Group, 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
year.
Diluted loss per share
Diluted loss 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 additional ordinary shares that would
have been outstanding assuming the conversion of all dilutive potential ordinary shares.
ANNUAL REPORT 30 JUNE 2021
Page 59 of 81
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 17: AUDITOR’S REMUNERATION
Audit services
BDO Audit (WA) Pty Ltd
- Audit and review of the financial reports
Total remuneration
CONSOLIDATED
2021
$
2020
$
32,900
32,900
28,000
28,000
NOTE 18: CONTINGENT ASSETS AND LIABILITIES
The Group had contingent assets at 30 June 2021 in respect of:
Future royalty payments
In March 2015, Alchemy completed a Sale and Purchase Agreement with Northern Star Resources
Limited (“Northern Star”) whereby the tenement containing the Hermes gold resource and adjacent
tenements were acquired by Northern Star (“Hermes Tenements”).
In October 2016, Northern Star completed the sale of its Plutonic gold operations, which included the
Hermes Tenements to Billabong Gold Pty Ltd.
Alchemy retains a 1% of Net Smelter Return Royalty payable on refined gold recovered from the Hermes
Tenements in excess of 70,000oz and up to 90,000oz.
There are no other material contingent assets or liabilities as at 30 June 2021.
ANNUAL REPORT 30 JUNE 2021
Page 60 of 81
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 19: EVENTS OCCURRING AFTER THE REPORTING PERIOD
Carly Terzanidis joined Jessamyn Lyons as Joint Company Secretary on 23 August 2021.
The impact of the Coronavirus (COVID-19) pandemic is ongoing and while it has not significantly
impacted the entity up to 30 June 2021, it is not practicable to estimate the potential impact, positive
or negative, after the reporting date. The situation is rapidly developing and is dependent on measures
imposed by the Australian Government and other countries, such as maintaining social distancing
requirements, quarantine, travel restrictions and any economic stimulus that may be provided.
There have been no other events subsequent to reporting date which are sufficiently material to warrant
disclosure.
NOTE 20: COMMITMENTS
In order to maintain an interest in the exploration tenements in which the Group is involved, the Group
is committed to meet the conditions under which the tenements were granted. The timing and amount
of exploration expenditure commitments and obligations of the Group are subject to the minimum
expenditure commitments required as per the Mining Act 1978, as amended, and may vary significantly
from the forecast based upon the results of the work performed which will determine the prospectively
of the relevant area of interest. Currently, the minimum expenditure commitments for the granted
tenements are $728,670 (2020: $957,000) per annum.
Commitments in relation to the lease of office premises are payable as follows:
Within one year
Later than one year but not later than five years
Later than five years
CONSOLIDATED
2021
$
6,957
-
-
6,957
2020
$
6,957
-
-
6,957
ANNUAL REPORT 30 JUNE 2021
Page 61 of 81
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 21: FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
Financial Risk Management
Overview
The Group has exposure to the following risks from their use of financial instruments:
Interest rate risk
Credit risk
Liquidity risk
This note presents information about the Group’s exposure to each of the above risks, their objectives,
policies and processes for measuring and managing risk, and the management of capital. The Board of
Directors has overall responsibility for the establishment and oversight of the risk management
framework.
Risk management policies are established to identify and analyse the risks faced by the Group, to set
appropriate risk limits and controls, and to monitor risks and adherence to limits. Risk management
policies and systems are reviewed regularly to reflect changes in market conditions and the Group’s
activities.
The Audit Committee oversees how management monitors compliance with the Group’s risk
management policies and procedures and reviews the adequacy of the risk management framework in
relation to the risks faced by the Group. The Group’s principal financial instruments are tabled below.
Financial assets
Current
Cash and cash equivalents
Trade and other receivables
Financial liabilities
Current
Trade and other payables
Interest rate risk
CONSOLIDATED
2021
$
2020
$
924,376
47,113
971,489
873,397
54,637
928,034
129,794
129,794
208,282
208,282
Interest rate risk is the risk that the value of a financial instrument or cash flows associated with the
instrument will fluctuate due to changes in market interest rates. Interest rate risk arises from
fluctuations in interest bearing financial assets and liabilities that the Group uses.
Interest bearing assets comprise cash and cash equivalents which are considered to be short-term liquid
assets. It is the Group’s policy to settle trade payables within the credit terms allowed and therefore not
incur interest on overdue balances.
ANNUAL REPORT 30 JUNE 2021
Page 62 of 81
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 21: FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (Continued)
The following tables set out the carrying amount, by maturity, of the financial instruments that are
exposed to interest rate risk:
Floating
interest
rate
$
Fixed interest rate maturing in
Over 1 to 5
years
$
More than
5 years
$
1 year or
less
$
Consolidated 2021
Financial assets
Cash and cash equivalents
Trade and other receivables
Weighted average interest rate
Financial liabilities
Trade and other payables
Weighted average interest rate
Consolidated 2020
Financial assets
Cash and cash equivalents
Trade and other receivables
Weighted average interest rate
Financial liabilities
Trade and other payables
Weighted average interest rate
907,876
-
16,500
-
907,876
16,500
0.51%
0.6%
-
-
-
-
-
-
234,207
-
234,207
616,500
-
616,500
0.09%
1.34%
-
-
-
-
-
-
Sensitivity analysis for interest rate exposure
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Non-
interest
bearing
$
Total
$
-
47,113
924,376
47,113
47,113
971,489
-
-
129,794
129,794
129,794
129,794
-
-
22,690
54,637
77,327
-
208,282
208,282
-
873,397
54,637
928,034
-
208,282
208,282
-
A change of 100 basis points in interest rates at the reporting date would have increased/(decreased)
equity and profit or loss by the amounts shown below:
Impact on profit/(loss) and equity
Increase of 100 basis points
Decrease of 100 basis points
2021
$
17,486
(17,486)
2020
$
11,890
(11,890)
ANNUAL REPORT 30 JUNE 2021
Page 63 of 81
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 21: FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (Continued)
Credit risk
Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument
fails to meet its contractual obligations, and arises principally from the Group’s receivables from
customers and investment securities. The Group trades only with recognised, creditworthy third parties.
It is the Group policy that all customers who wish to trade on credit terms are subject to credit
verification procedures. In addition, receivable balances are monitored on an ongoing basis with the
result that the Group’s exposure to bad debts is not significant. The maximum exposure to credit risk is
the carrying value of the receivable, net of any expected credit losses.
With respect to credit risk arising from the other financial assets of the Group, which comprise cash and
cash equivalents, the Group’s exposure to credit risk arises from default of the counter party, with a
maximum exposure equal to the carrying amount of these instruments. This risk is minimised by
reviewing term deposit accounts from time to time with approved banks of a sufficient credit rating
which is -AA and above.
Exposure to credit risk
The carrying amount of the Group’s financial assets represents the maximum credit exposure. The
Group’s maximum exposure to credit risk is tabled below:
Cash and cash equivalents
Liquidity risk
CONSOLIDATED
2021
$
2020
$
924,376
924,376
873,397
873,397
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due.
The Group’s approach to managing liquidity is to ensure, as far as possible, that it will always have
sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without
incurring unacceptable losses or risking damage to the Group’s reputation.
ANNUAL REPORT 30 JUNE 2021
Page 64 of 81
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 21: FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (Continued)
The Group’s objective is to maintain a balance between continuity of funding and flexibility. The
following are the contractual maturities of financial liabilities:
Consolidated - 2021
Trade and other payables
Consolidated – 2020
Trade and other payables
Capital risk management
Less than 6
months
$
Contractual
cash flows
$
Carrying amount
$
129,794
129,794
129,794
129,794
129,794
129,794
208,282
208,282
208,282
208,282
208,282
208,282
The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a
going concern in order to provide returns for shareholders and benefits for other stakeholders and to
maintain an optimal capital structure to reduce the cost of capital. The management of the Group’s
capital is performed by the Board.
The capital structure of the Group consists of net debt (trade and other payables and provisions detailed
in notes 11 and 12 offset by cash and bank balances) and equity of the Group (comprising issued capital,
reserves, offset by accumulated losses detailed in notes 13, 14 and 15).
The Group is not subject to any externally imposed capital requirements. None of the Group’s entities
are subject to externally imposed capital requirements.
ANNUAL REPORT 30 JUNE 2021
Page 65 of 81
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 22: SHARE-BASED PAYMENTS
a) Share option and performance right plan
The Group has an Employee Incentive Scheme (“Scheme”) for executives and employees of the
Group. In accordance with the provisions of the Scheme, as approved by shareholders at a previous
annual general meeting, executives and employees may be granted options and performance
rights at the discretion of the Directors.
Each share option and performance right converts into one ordinary share of Alchemy Resources
Limited on exercise. No amounts are paid or are payable by the recipient on receipt of the option.
The options carry neither rights of dividends nor voting rights. Options may be exercised at any
time from the date of vesting to the date of their expiry.
Options and performance rights issued to Directors are not issued under the Scheme but are
subject to approval by shareholders.
The following share-based payment arrangements under share option and performance right plan
were in existence during the reporting period:
Option
series
12
13
14
15
16
17
18
Rights
series
1
2
3
Number
Grant date
Expiry date
Vesting date
4,000,000
4,000,000
4,000,000
10,000,000
1,000,000
4,000,000
7,000,000
Grant date
1 Jan 2021
1 Jan 2021
1 Jan 2021
9 Jan 2017
9 Jan 2017
9 Jan 2017
16 Apr 2018
11 Dec 2019
7 Feb 2020
1 Jan 2021
Vesting and
exercise date
8 Jan 2021
8 Jan 2021
8 Jan 2021
15 Apr 2021
31 Dec 2023
31 Dec 2023
31 Dec 2021
8 Jan 2018
8 Jan 2019
8 Jan 2020
Immediate
Immediate
Immediate
31 Dec 2023
Expiry date
Exercise price
Various
Various
Various
31 Dec 2023
31 Dec 2023
31 Dec 2023
Nil
Nil
Nil
Exercise
price
$0.04
$0.08
$0.12
$0.05
$0.025
$0.025
$0.0252
Value per
right at
grant date
$0.009
$0.0016
$0.007
Fair value at
grant date
$0.0075
$0.0054
$0.0042
$0.0069
$0.0070
$0.0070
$0.0090
% Vested
0%
0%
0%
Fair value of share options and performance rights granted during the year
The fair value of share options at grant date are determined using a Black-Scholes option pricing
model that takes into account the exercise price, the term of the option, the share price at grant
date, the expected price volatility of the underlying share and the risk free rate for the term of the
option.
The fair value of options granted is recognised as an employee benefits expense with a
corresponding increase in equity. The fair value is measured at grant date and spread over the
period during which the employees become unconditionally entitled to the options.
On 1 January 2021, 7,000,000 unlisted options were granted to CEO, James Wilson as sign-on bonus.
The sign-on options will become exercisable (vest) twelve months after the commencement date.
ANNUAL REPORT 30 JUNE 2021
Page 66 of 81
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 22: SHARE-BASED PAYMENTS (Continued)
a) Share option and performance right plan (continued)
Share-based payment expense of $31,856 was recognised in the current year in the Consolidated
Statement of Profit or Loss and Other Comprehensive Income. The model inputs for the 7,000,000
options granted during the year ended 30 June 2021 are as follows:
Inputs
Series 18
Exercise Price
Grant date
Vesting date
Expiry date
Share price at grant date
Expected price volatility
Risk-free interest rate
Expected dividend yield
Value per option
$0.0252
1 January 2021
31 December 2021
31 December 2023
$0.018
102.60%
0.10%
0%
$0.009
On 1 January 2021, CEO, James Wilson was granted 10,000,000 unlisted performance rights, issued in
three tranches (20%, 40%, 40%) with vesting dependent upon the satisfaction of the following
performance hurdles:
- Up to 4,000,000 Tranche 1 of the performance rights will vest where the Company’s Market
Capitalisation on 31 December 2021 is:
• Greater than or equal to $50 Million then 4,000,000 of the Tranche 1 Performance Rights will
vest on 31 December 2023; or
• Greater than or equal to $25 Million but less than $50 Million then 2,000,000 of the Tranche 1
Performance Rights will vest on 31 December 2023; or
• Less than $25 Million then no Tranche 1 Performance Rights will vest on 31 December 2023.
- Up to 4,000,000 Tranche 2 of the performance rights will vest if the Company’s relative performance
of the Company’s share price compared to that of the S&P/ASX Small Ordinaries Resources Index
(AXSRD) over the period 1 January 2021 to 31 December 2023 is:
• Greater than or equal to 100% outperformance then 4,000,000 of the Tranche 2 Performance
Rights will vest on 31 December 2023; or
• Greater than or equal to 50% outperformance but less than 100% outperformance then
2,000,000 of the Tranche 2 Performance Rights will vest on 31 December 2023; or
• Less than 50% outperformance then no Tranche 2 Performance Rights will vest on the 31
December 2023.
- Up to 2,000,000 Tranche 3 of the performance rights will vest if the Company’s share price is greater
than or equal to $0.10 at 31 December 2023.
ANNUAL REPORT 30 JUNE 2021
Page 67 of 81
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 22: SHARE-BASED PAYMENTS (Continued)
a) Share option and performance right plan (continued)
The total fair value of the Tranche 1, 2 and 3 performance rights were estimated as at the grant date
using the Monte Carlo simulations taking into account the terms and conditions below and the risk-free
interest rate of 0.10% and volatility of 102.60%:
Number
granted
4,000,000
4,000,000
2,000,000
Grant date
1 January 21
1 January 21
1 January 21
Exercise
price
Nil
Nil
Nil
Expiry date
31 Dec 2023
31 Dec 2023
31 Dec 2023
Fair value at
grant date
$0.009
$0.016
$0.007
Total fair
value
$35,620
$64,509
$13,196
% vested
0%
0%
0%
The fair value of performance rights expensed during the year was $18,629.
b) Share options granted to a broker
In August 2020, the Company issued 3,000,000 unlisted options exercisable at $0.03 on or before 30
September 2022 to a broker pursuant to a Placement (refer note 13). The options were valued based
on the Black and Scholes option pricing model with the share-based payment expense of $24,600
recognised in the current year in equity as capital raising costs. The key inputs to the models used
were as follows.
Inputs
Series 19
Exercise Price
Grant date
Vesting date
Expiry date
Share price at grant date
Expected price volatility
Risk-free interest rate
Expected dividend yield
Value per option
$0.03
18 August 2020
Immediate
30 September 2022
$0.017
116%
0.27%
0%
$0.0082
ANNUAL REPORT 30 JUNE 2021
Page 68 of 81
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 23: SHARE-BASED PAYMENTS (Continued)
c) Movements in options and performance rights during the year
Movement in the number of options and performance rights held by directors, employees and
advisors:
2021
2020
No. of
options
Weighted
average exercise
price ($)
No. of
options
Weighted
average exercise
price ($)
Outstanding at the beginning of the year
Granted during the year
Expired during the year
27,000,000
10,000,000
(26,750,000)
Outstanding at the end of the year
Exercisable at the end of the year
10,250,000
3,250,000
0.06
0.0266
0.06
0.0266
0.03
22,000,000
5,000,000
-
27,000,000
27,000,000
0.07
0.025
-
0.06
0.06
The weighted average remaining contractual life of share options outstanding at the end of the
year was 2.14 years (2020: 1.18 years).
The weighted average remaining contractual life of performance rights outstanding at the end of
the year was 2.5 years.
d) Options outstanding at the end of the year
Share options issued and outstanding at the end of the year have the following exercise prices:
Expiry date
30 September 2022
31 December 2023
31 December 2023
Exercise price ($)
0.03
0.025
0.0252
2021 (number)
33,429,776
250,000
7,000,000
40,679,776
2020 (number)
-
5,000,000
-
5,000,000
ANNUAL REPORT 30 JUNE 2021
Page 69 of 81
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 24: RECONCILIATION OF CASH FLOWS FROM OPERATING ACTIVITIES
Cash flows from operating activities
Loss for the period
Non-cash flows in profit/(loss):
- Depreciation
- Share-based remuneration
- Exploration expenditure write-off
Change in assets and liabilities:
- Decrease/(increase) in trade receivables
- Decrease/(increase) in prepayments
- Increase/(decrease) in trade creditors and accruals
- Increase/(decrease) in provisions
CONSOLIDATED
2021
$
2020
$
(524,830)
(390,897)
8,048
50,485
15,040
19,996
(2,773)
6,175
(657)
1,378
37,148
12,233
(33,787)
(5,847)
(9,528)
(9,794)
Net cash used in operating activities
(428,516)
(399,094)
Non-cash investing and financing activities
There were no non-cash investing activities during the year.
During the year, 3,000,000 unlisted options valued at $24,600 were issued to the brokers as capital
raising costs.
ANNUAL REPORT 30 JUNE 2021
Page 70 of 81
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 25: RELATED PARTY DISCLOSURE
a) Parent entity
Alchemy Resources Limited
Ordinary
Australia
-
-
Class
Country of
incorporation
Investment at cost
2021 ($)
2020 ($)
b) Subsidiaries
Alchemy Resources (Murchison) Pty Ltd
Alchemy Resources (Three Rivers) Pty Ltd
Goldtribe Corporation Pty Ltd
Alchemy Resources (NSW) Pty Ltd
Class
Ordinary
Ordinary
Ordinary
Ordinary
Country of
incorporation
Investment at cost
2021 ($)
2020 ($)
Australia
Australia
Australia
Australia
100
100
1
1
100
100
1
1
c) Key management personnel compensation
Short-term employee benefits
Post-employment benefits
Share-based payments
CONSOLIDATED
2021
$
2020
$
284,307
18,946
50,485
353,738
195,999
14,820
30,148
240,967
There were no related party transactions during the year ended 30 June 2021.
The wife of Mr Ryan, former Managing Director, provided geological drafting and database services
to the Company to the value of $7,485 in the year ended 30 June 2020. The services were provided
on normal commercial terms and conditions.
Detailed remuneration disclosures are provided in the remuneration report on pages 33 to 39.
On 1 January 2021, 7,000,000 unlisted options 10,000,000 unlisted performance rights were granted
to CEO, James Wilson. Refer note 22 for details.
ANNUAL REPORT 30 JUNE 2021
Page 71 of 81
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 26: PARENT ENTITY DISCLOSURE
Financial Performance
Loss for the year
Other comprehensive income
Total comprehensive loss
Financial Position
ASSETS
Current assets
Non-current assets
TOTAL ASSETS
LIABILITIES
Current liabilities
TOTAL LIABILITIES
NET ASSETS
EQUITY
Issued equity
Reserves
Accumulated losses
TOTAL EQUITY
CONSOLIDATED
2021
$
1,754,089
-
1,754,089
2020
$
938,878
-
938,878
946,281
2,288
913,865
5,809
948,569
919,674
103,334
103,334
99,220
99,220
845,235
820,454
35,394,645
76,835
(34,626,245)
33,690,859
171,600
(33,042,005)
845,235
820,454
No guarantees have been entered into by Alchemy Resources Limited in relation to the debts of its
subsidiaries. Alchemy Resources Limited had no expenditure commitments as at 30 June 2021 other
than the commitment in relation to the lease of office premises as disclosed in note 20.
ANNUAL REPORT 30 JUNE 2021
Page 72 of 81
DIRECTORS’ DECLARATION
The Directors of Alchemy Resources Limited declare that:
a)
in the Directors’ opinion, the financial statements and notes set out on pages 42 to 72 and the
Remuneration Report in the Directors’ Report are in accordance with the Corporations Act 2001,
including:
i)
ii)
giving a true and fair view of the consolidated entity’s financial position as at 30 June 2021 and
its performance, for the financial year ended on that date; and
complying with Australian Accounting Standards (including the Australian Accounting
Interpretations), Corporations Regulations 2001 and mandatory professional reporting
requirements.
b)
c)
the financial statements also comply with International Financial Reporting Standards as disclosed
in note 2; and
there are reasonable grounds to believe that the consolidated entity 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
by the Chief Executive Officer and Chief Financial Officer for the financial year ended 30 June 2021.
Signed in accordance with a resolution of the Directors.
Lindsay Dudfield
Chairman
Perth, Western Australia
14 September 2021
ANNUAL REPORT 30 JUNE 2021
Page 73 of 81
Type text here Tel: +61 8 6382 4600
Fax: +61 8 6382 4601
www.bdo.com.au
38 Station Street
Subiaco, WA 6008
PO Box 700 West Perth WA 6872
Australia
INDEPENDENT AUDITOR'S REPORT
To the members of Alchemy Resources Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Alchemy Resources Limited (the Company) and its subsidiaries
(the Group), which comprises the consolidated statement of financial position as at 30 June 2021, the
consolidated statement of profit or loss and other comprehensive income, the consolidated statement
of changes in equity and the consolidated 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 the Group, is in accordance with the Corporations
Act 2001, including:
(i)
Giving a true and fair view of the Group’s financial position as at 30 June 2021 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 Group 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 2(b) 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
group’s ability to continue as a going concern and therefore the group 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.
BDO Audit (WA) Pty Ltd ABN 79 112 284 787 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 (WA) 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.
Page 74 of 81
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.
Recoverability of exploration and evaluation expenditure
Key audit matter
How the matter was addressed in our audit
As disclosed in Note 9 to the Financial Report, the
carrying value of capitalised exploration and
evaluation expenditure represents a significant asset
of the Group.
Refer to Note 9 of the Financial Report for a
description of the accounting policy and significant
judgements applied to capitalised exploration and
evaluation expenditure.
In accordance with AASB 6 Exploration for and
Evaluation of Mineral Resources (AASB 6), the
recoverability of exploration and evaluation
expenditure requires significant judgment by
management in determining whether there are any
facts or circumstances that exist to suggest that the
carrying amount of this asset may exceed its
recoverable amount. As a result, this is considered a
key audit matter.
Our procedures included, but were not limited
to:
Obtaining a schedule of the areas of interest
held by the Group and assessing whether the
rights to tenure of those areas of interest
remained current at balance date;
Considering the status of the ongoing
exploration programmes in the respective
areas of interest by holding discussions with
management, and reviewing the Group’s
exploration budgets, ASX announcements
and directors’ minutes;
Considering whether any such areas of
interest had reached a stage where a
reasonable assessment of economically
recoverable reserves existed;
Considering whether any facts or
circumstances existed to suggest impairment
testing was required; and
Assessing the adequacy of the related
disclosures in Note 9 to the Financial Report.
Page 75 of 81
Other information
The directors are responsible for the other information. The other information comprises the
information in the Group’s annual report for the year ended 30 June 2021, but does not include the
financial report and the 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 ability of the group 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 Group 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/ar1_2020.pdf
This description forms part of our auditor’s report.
Page 76 of 81
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 33 to 39 of the directors’ report for the
year ended 30 June 2021.
In our opinion, the Remuneration Report of Alchemy Resources Limited, for the year ended 30 June
2021, 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 (WA) Pty Ltd
Glyn O'Brien
Director
Perth, 14 September 2021
Page 77 of 81
ADDITIONAL SHAREHOLDER INFORMATION AS AT 5 SEPTEMBER 2021
Additional information required by the Australian Securities Exchange Limited and not shown elsewhere
in this report is as follows.
Distribution of Holders of Equity Securities
Shares held
Shareholders
1 to 1,000
1,001 to 5,000
5,001 to 10,000
10,001 to 100,000
100,001 and over
Total
146
158
128
552
439
1,423
The number of holders of less than a marketable parcel of ordinary fully paid shares is 664.
Substantial Shareholders
Substantial shareholders (i.e. shareholders who hold 5% or more of the issued capital):
Northern Star Resources Limited
Mr Lindsay George Dudfield & Mrs Yvonne Sheila Doling Dudfield
Voting Rights
a) Ordinary shares
Number of
shares
78,125,000
Percentage
held (%)
11.62
40,842,067
6.08
Each shareholder is entitled to receive notice of and attend and vote at general meetings of the
Company. At a general meeting, every shareholder present in person or by proxy, representative
of attorney will have one vote on a show of hands and on a poll, one vote for each share held.
b) Options
No voting rights.
Quoted Securities on Issue
The Company has 672,243,453 quoted shares on issue. No options on issue by the Company are
quoted.
On-Market Buy Back
There is no current on-market buy back.
ANNUAL REPORT 30 JUNE 2021
Page 78 of 81
ADDITIONAL SHAREHOLDERS INFORMATION
Unquoted Equity Securities
Options exercisable at $0.025 on or before 31 December 2023
Options exercisable at $0.0252 on or before 31 December 2023
Options exercisable at $0.03 on or before 30 September 2022
Twenty Largest Holders of Quoted Ordinary Shares
Shareholder
Northern Star Resources Limited
Mr Lindsay George Dudfield & Mrs Yvonne Sheila Doling Dudfield
Rossdale Superannuation Pty Ltd
TBB Nsw Pty Ltd
Netwealth Investments Limited
Jindalee Resources Limited
Mr Christopher Paul Lewis
Heron Resources Limited
Jetosea Pty Ltd
Rossdale Super Pty Ltd
Kale Capital Corporation Ltd
Eric Anthony Frederick Bennik
Moryton Pty Ltd
Grandor Pty Limited
Bluestar Management Pty Ltd
Bora Bora Resources Limited
BNP Paribas Nominees Pty Ltd Six Sis Ltd
Ms Zhen Chen
Radrob Pty Ltd
Wilgus Investments Pty Ltd
Foster Capital NZ Limited
Number on
issue
250,000
7,000,000
33,429,776
Number of
holders
1
1
276
Number of
shares
Percentage
held (%)
78,125,000
40,842,067
27,250,001
25,674,166
22,387,503
17,469,759
16,118,592
12,000,000
11,870,955
11,000,000
9,587,750
8,729,300
7,500,000
7,398,099
7,000,000
7,000,000
6,993,347
6,386,666
6,000,000
6,000,000
6,000,000
352,166,537
11.62
6.08
4.05
3.82
3.33
2.60
2.40
1.79
1.77
1.64
1.43
1.30
1.12
1.10
1.04
1.04
1.04
0.95
0.89
0.89
0.89
52.39
ANNUAL REPORT 30 JUNE 2021
Page 79 of 81
TENEMENT SCHEDULE
Project/Tenement
Bryah Basin Project
State
Western Australia
Status
Interest
Co-holder
Notes
E52/1668
E52/1678
E52/1722
E52/1723-I
E52/1730
E52/1731
E52/1810
E52/1852
E52/2360
E52/2362
E52/3292
E52/3358
E52/3359
E52/3405
E52/3406
E52/3407
E52/3408
E52/3409
E52/3472
E52/3475
M52/722
M52/723
M52/737
M52/795
M52/844-I
M52/1049
P52/1425
P52/1427
P52/1428
P52/1429
P52/1467
P52/1468
P52/1469
P52/1470
P52/1531
P52/1532
P52/1533
P52/1534
P52/1535
P52/1538
P52/1539
P52/1540
P52/1541
P52/1565
P52/1566
P52/1567
P52/1568
P52/1572
P52/1577
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
10%
10%
10%
20%
10%
20%
20%
20%
20%
20%
20%
20%
20%
20%
20%
20%
20%
20%
20%
20%
20%
20%
20%
20%
20%
20%
20%
20%
20%
20%
20%
20%
20%
20%
20%
20%
20%
20%
20%
10%
10%
20%
20%
20%
20%
20%
20%
20%
20%
Jackson / Billabong / Sandfire
Jackson / Billabong / Sandfire
Jackson / Sandfire
Billabong / Sandfire
Jackson / Billabong / Sandfire
Billabong / Sandfire
Sandfire
Billabong
Sandfire
Billabong / Sandfire
Sandfire
Sandfire
Sandfire
Billabong / Sandfire
Billabong / Sandfire
Sandfire
Billabong / Sandfire
Sandfire
Sandfire
Sandfire
Billabong / Sandfire
Billabong / Sandfire
Billabong
Billabong / Sandfire
Sandfire
Billabong
Sandfire
Sandfire
Sandfire
Billabong
Sandfire
Sandfire
Sandfire
Sandfire
Sandfire
Sandfire
Sandfire
Sandfire
Sandfire
Jackson / Billabong
Jackson / Billabong
Sandfire
Sandfire
Sandfire
Sandfire
Sandfire
Sandfire
Sandfire
Billabong
1, 2, 3
1, 2, 3
1, 2
2, 4, 5
1, 2, 3
2, 4
2
4
2, 6
2, 4, 6
2
2
2
2, 4
2, 4
2
2, 4
2
2
2
2, 4, 6
2, 4, 6
4, 6
2, 4, 6
2, 6
4, 6
2
2
2
4
2
2
2
2
2
2
2
2
2
1, 4
1, 4
2
2
2
2
2
2
2, 6
4, 6
ANNUAL REPORT 30 JUNE 2021
Page 80 of 81
TENEMENT SCHEDULE
Project/Tenement
Karonie Project
E28/2575
E28/2576
E28/2601
E28/2619
E28/2643
E28/2657
E28/2667
E28/2668
E28/2681
E28/2752
E28/2880
E28/2940
E28/2976
E28/3032
E28/3069
E28/3098
Lake Rebecca Project
E28/3006
E28/3008
E28/3010
E28/3012
E28/3035
E28/3039
E28/3048
E28/3053
E28/3058
E28/3059
E28/3063
E28/3064
Lachlan Projects
EL5878 - Overflow
EL7941 - Overflow
EL8267 - Overflow
Nth
EL8356 - Yellow Mtn
EL8192 - Eurow
EL8318 -
Girilambone
EL8631 - West Lynn
EL8711 - Woodsreef
State
Western Australia
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
Western Australia
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
New South Wales
NSW
NSW
NSW
NSW
NSW
NSW
NSW
NSW
Status
Interest
Co-holder
Notes
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Appl.
Appl. (contest)
Appl.
Appl. (contest)
Appl.
Appl.
Appl.
Appl.
Appl. (contest)
Appl. (contest)
Appl. (contest)
Appl.
Appl.
Appl.
Appl.
Appl.
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
80%
80%
80%
80%
80%
80%
80%
80%
Heron Resources
Heron Resources
Heron Resources
Heron Resources
Heron Resources
Heron Resources
Heron Resources
Heron Resources
7
7
7
7
7
7
7
7
7
7
7
7
7
7
7
7
7
7
7
7
7
7
7
7
7
7
7
7
8
8
8
8
8
8
8
8
Notes:
1.
2. Sandfire Resources NL (ASX: SFR) holds a 70-80% interest (excludes iron ore) in whole or part tenements, with Alchemy free-carried
Jackson Minerals Pty Ltd, a subsidiary of Fe Ltd (ASX: FEL), retains a 20% interest free-carried to a decision to mine.
up to completion of a pre-feasibility study.
3. Billabong Gold Pty Ltd holds a 70% interest in whole or part of tenement.
4. Billabong Gold Pty Ltd holds an 80% interest in whole or part of tenement.
5. PepinNini Robinson Range Pty Ltd retains a 1% NSR on iron ore.
6. Carey Mining Iron Ore JV: Alchemy has 100% mineral rights for all minerals, excluding iron ore where ownership is Alchemy 50% /
Carey Mining 50%.
7. Goldtribe Corporation Pty Ltd, a subsidiary of Alchemy Resources Ltd, holds a 100% interest in the tenement.
8. Alchemy Resources (NSW) Pty Ltd, a subsidiary of Alchemy Resources Ltd, holds a 80% interest with Heron Resources owning the
remaining 20%.
ANNUAL REPORT 30 JUNE 2021
Page 81 of 81