AS PIRE MINING LIMITED
ANNUAL REPORT
2019
CORPORATE
INFORMATION
ASPIRE MINING LIMITED
ABN 46 122 417 243
DIRECTORS
Mr David Paull (Executive Chairman)
Mr Gan-Ochir Zunduisuren (Executive Director)
SHARE REGISTRY
Security Transfer Australia Pty Ltd
770 Canning Highway
Applecross, WA 6153 AUSTRALIA
Telephone: 1300 992 916
Facsimile: +61 8 9315 2233
Mr Boldbaatar Bat-Amgalan (Executive Director)
Email: registrar@securitytransfer.com.au
Mr Neil Lithgow (Non-Executive Director)
Ms Hannah Badenach (Non-Executive Director)
SOLICITORS
Mr Alexander Passmore (Non-Executive Director)
Corrs Chambers Wesgarth Lawyers
Mr Achit-Erdene Darambazar (Non-Executive Director)
Level 6, Brookfield Place Tower 2
COMPANY SECRETARY
Mr Philip Rundell
REGISTERED OFFICE
Level 9, 182 St Georges Terrace
Perth, WA 6000 AUSTRALIA
Telephone: +61 8 9287 4555
Facsimile: +61 8 9353 6974
Email: info@aspiremininglimited.com
PRINCIPAL PLACE OF BUSINESS
AUSTRALIA
Level 9, 182 St Georges Terrace
Perth, WA 6000
MONGOLIA
Sukhbaatar District, 1st Khoroo
Chinggis Avenue-8
Altai Tower, 3rd Floor, Room 302
Ulaanbaatar 14253
WEBSITES
www.aspiremininglimited.com
123 St Georges Terrace
Perth, WA 6000 AUSTRALIA
BANKERS
National Australia Bank
Level 1, 1238 Hay Street
West Perth, WA 6005 AUSTRALIA
AUDITORS
HLB MANN JUDD
Level 4, 130 Stirling Street
Perth, WA 6000 AUSTRALIA
KPMG
Suite 602, 6th Floor, Blue Sky Tower
Peace Avenue 17
Sukhbaatar District, 1st Khoroo
Ulaanbaatar 14200 MONGOLIA
SECURITIES EXCHANGE LISTING
AKM
Cover image: Painting by Mongolian artist Batireedui Shagdar
TABLE OF
CONTENTS
OPERATIONAL OVERVIEW
Chairman’s Letter
Operational Review
Coal Projects
Community Relations
Rail Infrastructure Investment
Corporate
FINANCIAL & SHAREHOLDER REPORTING
Directors’ Report
Auditor’s Independence Declaration
ii
iv
vi
xiv
xvi
xvii
2
16
Consolidated Statement of Profit or Loss and other Comprehensive Income
17
Consolidated Statement of Financial Position
Consolidated Statement of Changes In Equity
Consolidated Statement of Cash Flows
Notes to the Consolidated Financial Statements
Directors’ Declaration
Independent Auditor’s Report
Additional Shareholder Information
18
19
20
21
52
53
57
CHAIRMAN’S
LETTER
Dear Shareholders
The year just passed was a combination of great
promise combined with frustration in not being
able to progress as we had planned.
The encouragement came from the outstanding
financial results from the Pre-Feasibility Study
(“PFS”) for the Ovoot Early Development Plan
(“OEDP”) which focuses on mining a low ash near
surface portion of the Ovoot Resource and delivery
of the washed coking coal via a road based
connection from the Ovoot minesite to the existing
rail head at Erdenet. Both the starter pit and the
12.5 year “Extended Case” captured a significant
amount of the value of the Ovoot Project while
only mining a fraction of the Resource.
the very encouraging PFS,
Post
the Board
approved the start of a Definitive Feasibility Study
(“DFS”) to support an investment decision. This
included engineering and design of a 560 km haul
road between Ovoot and Erdenet, further logistics
studies for the various paths to customers in China
and Russia, and on-site engineering and drilling to
complete geotechnical, hydrological and structural
studies to a DFS standard.
However, notwithstanding that the Company has a
valid 30 year mining license from issue in August
2012 and has also received approval for the OEDP
Reserve and Feasibility Study from the Minerals
Resource Authority of Mongolia, it has not yet
been able to conclude approvals with the local
community in which Ovoot is located to complete
drilling activities required for the DFS. While legally
the Company can access the site and conduct the
required activities without community support, the
Company is also mindful that it needs a long term
mutually beneficial cooperation agreement with
the local community to secure a social license for
the life of the Ovoot Project.
This is a very significant decision for the local
community and the education of the benefits
of this project need to be carefully managed by
all stakeholders. As development progresses
to operation, the Ovoot Project will very quickly
become the largest private employer in the
Khuvsgul Province and will have a major positive
impact on the local economy and incomes.
The local community is awaiting direction from
the provincial government in terms of the road
path from Ovoot. This road will be a key piece
of infrastructure and will be of immense value to
the local community to provide safe and secure
road access to the rest of the country. We are
working in a proactive and positive way with the
local community as further explained in this Annual
Report and are hopeful of a positive outcome in
the near future. Nevertheless, further progress
on the DFS has been delayed while this access
is resolved.
In December 2018, the Company completed a
$15m placement which saw major shareholder, Mr
Tserenpuntsag, emerge with a 27.5% interest in the
Company. Simultaneously, Noble Group converted
its remaining debt into equity in the Company.
This raising and loan repayment positioned the
Company with no debt and a healthy cash position
which meant the Company was able to deal with
the impacts of the above delays. There is also no
ii
ASPIRE MINING LIMITED | ANNUAL REPORT 2019 “The Ovoot Project will very quickly become
the largest private employer in the Khuvsgul
province and will have a major positive
impact on the local economy and incomes.”
from Mr Tserenpuntsag to contribute 50% of any
future required equity through to completion of the
OEDP and the provision of up to A$100 million in
debt guarantees, as the best opportunity available
to the Company to progress Ovoot into production.
As part of the above Subscription Agreement
terms, and conditional on the placement being
completed, the Company has agreed to reduce
the Board to 5 Directors. Executive Director
Mr Gan-Ochir Zunduisuren and Non-Executive
Director Mr Alex Passmore have agreed to step
down. Mr Zunduisuren will continue in a technical
management role. On behalf of shareholders, I
wish to thank them for their contributions.
I have had many discussions with shareholders
through the year, with both large and small
holdings. I recall one discussion in particular that
noted that trying to get Ovoot into production was
like watching paint dry. I completely understand
this observation and along with the Board, share
this frustration. However, I was reminded recently
about the remote chances of discovering world
class resource projects of any commodity. The
chances of finding a commercial deposit are
higher than 1 in every 1,000 exploration projects.
So when you have made such a discovery it is
worth the time and effort to persevere and see a
successful commercial outcome.
David Paull
Executive Chairman
iii
doubt that the larger level of Mongolian ownership
has built a level of trust with the local communities
at the soum and provincial level.
The Company has been engaging with potential
debt and equity providers through the year. The
Company received a proposal from its major
shareholder Mr Tserenpuntsag to invest a further
$33.5 million in the Company at a premium to the
then current share price in order to increase his
ownership to 51%, effectively a change in control
transaction. After careful Board deliberation and
engaged corporate adviser advice, the proposal
was formalised by execution of a Subscription
Agreement between
the Company and Mr
Terenpuntsag on 6 September 2019. Completion
of the Subscription Agreement’s share placement
and its other terms is conditional on independent
expert opinion that the transactions are at least
reasonable if not fair to other shareholders and
shareholder approval is given. The independent
expert report and an Explanatory Statement will
be included with the Notice of Annual General
Meeting for consideration by shareholders at the
Company’s coming Annual General Meeting to be
held in November 2019.
This material extra cash on the balance sheet will
provide an improved negotiation position with
potential debt providers and provide potential
development capital prior to the completion of the
DFS. Moving to 51% Mongolian ownership opens
up significant funding opportunities in Mongolia
as well as adding to the Company’s social license
to operate in Mongolia. Failing any better offer
made to the Company, the Board supports this
placement, resultant funding and the commitment
ASPIRE MINING LIMITED | ANNUAL REPORT 2019
OPERATIONAL
REVIEW
Listed on the Australian Stock Exchange, Aspire
Mining Limited (ASX: AKM, Aspire or the Company)
is a metallurgical coal resource development
and infrastructure company with all of its assets
in Mongolia.
STRATEGY
The Company’s strategy is to create wealth
for shareholders through the discovery and
development of metallurgical coal deposits. There
are only limited areas around the world where coal
suitable for use to make coke for steel making
are formed and make up just a small fraction of
coal deposits found globally. Metallurgical coal, or
more commonly known as coking coal is usually
priced at twice the value of high energy thermal
coal used in thermal power plants.
In 2010 the Company identified that Mongolia
had both the right geological environment to host
large coking coal deposits and the proximity to
China, the world’s largest market for coking coal.
Since then the Company has discovered the world
class Ovoot Coking Coal Project and acquired the
nearby Nuurstei Coking Coal Project.
MARKETING
Coking coal is an essential ingredient to make
coke which is added to iron ore in a blast furnace
to reduce the oxygen in the iron ore with carbon
to make steel. Put simply, the industrialised
and developing world needs steel for housing,
infrastructure, industrial development, consumer
goods etc. There is currently no substitute for a
blast furnace other than high energy consuming
electric arc furnaces that use steel scrap but which
produce significant pollutants.
China is the world’s largest producer of steel
producing 832 Mt in 2017. This steel production
required 531 Mt of coking coal of which
approximately 450 Mt was mined domestically
and 75 Mt was imported1.
Mongolia
is set to replace Australia as the
largest exporter of coking coal to China’s steel
industry with a 43% share in 2018. According to
the Mongolia’s Mineral Resources and Petroleum
Statistics 2018, Mongolia exported a total of 31 Mt
of coking coal but only 5.5 Mt had been washed
and the majority of these tonnes came from
Mongolian Mining Corporation’s UHG Mine. With
the full implementation of the OEDP, Aspire will
become the second largest exporter of Mongolian
washed coking coal into China.
1 Source: IHS Makhit Feb 2019. Fenwei Energy Information Services
Ltd Discover Mongolian Presentation 28 September 2019.
iv
ASPIRE MINING LIMITED | ANNUAL REPORT 2019
With the full implementation of the OEDP,
Aspire will become the second largest
exporter of Mongolian washed coking coal
into China.
v
ASPIRE MINING LIMITED | ANNUAL REPORT 2019 COAL
PROJECTS
OVOOT COKING COAL
PROJECT
The Ovoot Coking Coal Project (Ovoot or Ovoot
Project) is a world class coking coal discovery
in Northern Mongolia. Based on a 2013 Pre-
Feasibility Study, the Ovoot Project can produce
up to 10 million tonnes per annum of a “fat” coking
coal. Fat coking coal is valuable in the Chinese
and Russian steel industries due to its excellent
blend carrying characteristics and the ability to
improve coke quality when blending with lower
quality coking coals.
In August 2012 the Company received a mining
license granting a minimum 30 year tenure over
the deposit.
Through its 80% owned subsidiary, Northern
Railways LLC, the Company has been working on
the development of a rail link from the Ovoot Project
to the nearest rail head at Erdenet as providing the
lowest operating cost. However, with the recent
confirmation of up to 4 million tonnes per annum
of rail capacity on the central Mongolian rail line,
the Company was able to investigate a trucking
based option to get coking coal to Erdenet and
access this available rail capacity.
the results of
On 28 February and 1 March 2019, the Company
announced
the Ovoot Early
Development Plan (OEDP) Pre-Feasibility Study
(PFS). The OEDP involves mining a relatively low
ash, low strip ratio and high yielding “fat” coking
coal from a starter pit that sits within the 255 Mt
vi
Ovoot JORC Reserve2 (“Ovoot Project Reserve”).
The washed coal will then be delivered via a
560 km special purpose haul road that will be
constructed to connect to a rail head at Erdenet.
The coal will then be delivered on the Mongolian
rail network, that has confirmed available capacity
for OEDP coking coal of up to 4 million tones
per annum for the life of the OEDP, through to
the Mongolian/China border crossing of Erlian to
Chinese end customers.
The OEDP Base Case starter pit utilises a 36.8Mt
(OEDP Reserve3) carve out from the JORC Project
Reserve and supports an initial 9.2 year mine
life. This Base Case represents just 15% of the
Ovoot Project JORC Reserves. The Company also
identified an OEDP Extended Case that includes
an additional cut back and extends the mine life to
12.5 year mining 23% of Ovoot Project Reserves.
The OEDP will transform Aspire into a significant
pure play coking coal producer positioned in the
second quartile of the global cost curve.
The Company commenced the OEDP Definitive
Feasibility Study in March 2019 in order to inform
the Board for a decision to mine. The DFS has
been delayed while the Company negotiates a
community agreement and permitting approvals.
2 The Ovoot Project Reserve is defined as the 255 Mt Coal Reserve
Estimate announced on 31 January 2014.
3 The OEDP Reserves are the Coal Reserves shown in Table 4.
ASPIRE MINING LIMITED | ANNUAL REPORT 2019 OVERVIEW OF THE
OEDP AND THE KEY
PFS OUTCOMES
The OEDP PFS completed in February 2019
confirms the technical and economic robustness
of developing a steady state 4.0Mtpa operation
supported by a special purpose haul road which
will connect at Erdenet into the existing Mongolian
rail network to China and other key end markets.
Mining and process engineering designs for the
OEDP PFS have been developed to support capital
and operating estimates to an accuracy of +/- 25%
and +/- 15% respectively. Key assumptions that the
PFS is based are outlined in Table 1 and Figure 1
below. Aspire has concluded it has a reasonable
basis for providing the forward-looking statements
in this report.
For the purposes of this PFS, a flat price of
US$150/t Delivered at Place to the Erlian border
for Ovoot “fat” coking coal has been used based
on a detailed Chinese “fat” coking coal market
report completed by Fenwei Energy Information
Services Ltd (Fenwei) in December 2018.
The OEDP PFS confirms that significant coking
coal production can be achieved from Ovoot in a
low capital intensity manner to unlock attractive
economics that are not Ovoot to Erdenet rail
dependent. Aspire considers the OEDP could
feasibly be extended into a multi decade haul
road-based operation upon completing additional
rail connection ultimately
studies should a
not occur.
The PFS projected OEDP annual net pre-tax
cash flows of the Extended OEDP are graphed in
Figure 1.
400
300
200
100
_
_
(100)
(200)
(300)
(400)
2 019
2 0 2 0
2 0 21
2 0 2 2
2 0 23
2 0 24
2 0 2 5
2 0 2 6
2 0 27
2 0 2 8
2 0 2 9
2 0 3 0
2 0 31
2 0 32
2 0 33
Figure 1: OEDP Extended Case Projected Annual and Cumulative Cashflow
2,000
1,500
1,000
500
_
(500)
(1,000)
(1,500)
(2,000)
vii
ASPIRE MINING LIMITED | ANNUAL REPORT 2019 Table 1: Key OEDP PFS Outcomes
Physicals
Waste Mined (M Bcm)
Strip Ratio (Bcm/tcoal) (incl. pre-strip)
Coal Mined (Mt)
Average Yield (10% moisture)
Coal sold (net of 2% loss) (Mt)
Life of Mine
Operating Costs
Mine - $/t
Trucking – $/t
Rail + Border Charges- $/t
C1 Cash Costs 4/t
Total Cash Costs $/t
Financial Assumptions
Coking Coal Price (net received price to Erlian border)
Exchange Rates:
Royalties:
Mnt: USD
Rmb: USD
Mongolian
Marketing and China Border Cost US$/t
EBITDA
Capital Investment
Mine:
Road:
Pre-tax net present value (10%)
Internal Rate of Return (Pre-tax)
Establishment
Maintenance
Establishment
Maintenance
Average Annual
OEDP Total
Total Extended
Trucking Option
19.7
4.6
4.0
167.7
4.3
36.8
88%
31.6
253.6
4.5
53.8
86%
45.2
9.2 years
12.5 years
31
32
18
81
100
150
2600
6.8
6.5%
8.6
33
32
18
83
102
150
2600
6.8
6.5%
8.6
$170m
$1.6bn
$2.2bn
$110m
$1mpa
$165m
$2mpa
$586m
43.9%
$110m
$1mpa
$165m
$2mpa
$758m
44.5%
Payback (commencing first full year of production)
24 months
24 months
viii
ASPIRE MINING LIMITED | ANNUAL REPORT 2019
CAPITAL EXPENDITURE: MINE
The mine capital expenditure is made up of:
Table 2: Summary Mine Capital
CHPP Plant
Onsite infrastructure
Offsite terminals and blending facility
Mine Processing and Infrastructure
Waste Pre-stripping
Total Mine Capital
US$m
37
10
16
63
47
110
OPERATING COSTS
Operating cost estimates for the mine provided in the PFS are as follows:
Table 3: Life of OEDP Operating Costs
US$/t ROM
US$/t Product
Mining and Admin
CHPP Plant
Ex Mine Gate
Trucking to Erdenet
Rail to Erlian (plus border charges)
C1: Direct Cash Costs
Marketing and China Border Costs
Royalties
21.8
2.85
26.3
27.5
3.5
31.0
32.0
18.0
81.4
8.6
9.8
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ASPIRE MINING LIMITED | ANNUAL REPORT 2019 Figure 2: Location Map of Ovoot and Nuurstei Coking Coal Projects & Chinese Steel Mills
On 16 January 2019, the Company reported on
a study prepared by Fenwei Energy Information
Services Ltd to support the price assumptions
regarding the OEDP product in the Chinese market.
Fenwei noted in its report that the market in China
for “fat” coking coal is approximately 75 Mt and
that with forecast declining domestic production, a
deficit of between 16 Mt and 22 Mt was observable
over the medium term. Ovoot’s OEDP coking coal
will be feeding into this segment of the market.
Fenwei estimated delivered prices for OEDP
coking coal into these markets over the next five
years would achieve prices of between US$191/t
to US$180/t using an existing branded coal as
a benchmark on a delivered to customer gate
basis. By adding back Chinese trucking costs, an
equivalent price at the Mongolia/China border at
Erlian can be established. This calculated net back
forecast price at Erlian is between US$156/t down
to US$145/t.
The OEDP produces a mid volatile, medium ash and
sulphur fat coking coal with the following attributes.
Table 4: OEDP Coking Coal Product Properties
Moisture
Ash (adb)
Volatiles (adb)
Sulphur %
G Index
Y Index
Ro Max
9%
10%
25%
1.2%
95
26
1.2
x
ASPIRE MINING LIMITED | ANNUAL REPORT 2019 ERDENET TO OVOOT
HAUL ROAD
In order to deliver the planned coking coal volumes
to the rail terminal at Erdenet a special purpose
road is to be built between Ovoot and Erdenet.
A scoping study was completed using Mongolian
road consulting engineers, RCSC LLC,
that
reviewed a number of alternative routes including
following the planned Ovoot to Erdenet rail path.
The favoured option is a special purpose public
road with a distance of 560 km that links several
soum centres in Khuvsgul with the town of Mörön,
the Capital of Khuvsgul. There is wide support for
this road from the local governments and will also
have the added benefit of removing existing coal
truck traffic from a public road.
IMIL LLC has been appointed to complete a DFS
for this chosen road path. They have progressed
along with the Company’s Community Engagement
Department to engage with local communities
along the path.
The road will be sealed to suppress dust and will
cater for truck and trailer combinations of 115 t
gross vehicle mass and net coal capacity of 85 t.
The scoping level engineering study cost of road
construction before contingencies is made up
as follows:
Table 5: Haul Road Capital Costs
Road
Bridges and culverts
Total
US$m
130
35
165
Note: The above capital costs are estimated to an
accuracy of +/-25%.
While Ovoot will be the major user of the road, it
is likely that there will be other commercial users
who will be charged a toll. No benefit has been
assumed in the OEDP financial model from the
charging of future tolls to third party users of the
Erdenet to Ovoot Road.
NUURSTEI COKING COAL
PROJECT (90%)
The Company completed the acquisition of the
corporate entities that held the remaining 45%
interest in the project in July 2017 for US$1 million,
increasing the Company’s total interest in the
Nuurstei Project to 90%. In October 2017, a Mining
License was issued over the deposit.
Existing near surface Indicated JORC Resources of
4.8 Mt and Inferred JORC Resources of 8 Mt could
potentially enable a modest mining operation by
washing the relatively high ash raw coal down to
a 10% ash product. Coke oven test work on an
indicative sample of Nuurstei Coking Coal showed
outstanding results.
Further drilling and other engineering work is
required in order to complete early stage feasibility
work at Nuurstei. This work was planned to occur
in 2018. However, that work was deferred while
renegotiations with the local community continued
but was overtaken and replaced by the change in
strategy to development of the more advanced
and far larger scale Ovoot Early Development Plan.
xi
ASPIRE MINING LIMITED | ANNUAL REPORT 2019 JORC RESOURCES & RESERVES
Table 6: JORC Reserves and Resources
Deposit
Probable
Reserves
Measured
Indicated
Measured +
Indicated
Inferred
Resources
Ovoot Open Pit(2)
247.0
197.0
Ovoot Underground(2)
Nuurstei(3)
Total
Notes:
8.0
-
-
-
255.0
197.0
1. Ovoot’s Resource and Reserve estimates have been
estimated by independent third parties (Xstract Mining
Consultants Pty Ltd) and are reported in accordance to
the JORC 2012 Code.
for
the Company’s Quarterly Report
2. For full JORC 2012 disclosure in relation to the Ovoot
Project JORC 2012 Coal Resources and Reserves, refer
to
the period
ended 31 December 2013. which is available to view on
the Company’s website and the ASX Announcements
platform. The Company is not aware of any new information
or data that materially affects the information included in
this December 2013 Quarterly Report. All material
assumptions and technical parameters underpinning the
estimates in the December 2013 Quarterly Report continue
to apply and have not materially changed.
3. Nuurstei’s Resource and Reserve estimates have been
estimated by independent third parties (McElroy Bryan
Geological Services) and are reported in accordance to the
JORC 2012 Code.
4. The JORC Code (2012) compliant Ore Reserves and JORC
compliant Mineral Resources for the Nuurstei Coking Coal
Project is reported in the Company’s ASX Announcement
dated 13 April 2016 which is available to view on the
Company’s website and the ASX Announcements platform.
The Company is not aware of any new information or data
that materially affects the information included in the 13 April
2016 announcement. All material assumptions and
technical parameters underpinning the estimates in the
to apply and have not
announcement continue
materially changed.
Competent Persons Statement – Ovoot Coking Coal Project
In accordance with
the Australian Securities Exchange
requirements, the technical information contained in this
announcement in relation to the JORC Code (2012) Compliant
Coal Reserves and JORC Compliant Coal Resource for the
Ovoot Coking Coal Project in Mongolia has been reviewed
by Mr Ian De Klerk and Mr Kevin John Irving of Xstract Mining
Consultants Pty Ltd.
The Coal Resources at Ovoot Project documented in this
release are stated in accordance to the JORC Code, 2012.
They are based on information compiled and reviewed by Mr.
Ian de Klerk who is a Member of the Australasian Institute of
Mining and Metallurgy (Member #301019) and is a full time
employee of Xstract Mining Consultants Pty Ltd. He has more
than 20 years’ experience in the evaluation of coal deposits
and the estimation of coal resources. Mr. de Klerk has sufficient
xii
46.9
25.4
4.8
77.1
243.9
25.4
4.8
274.1
9.2
2.6
8.1
19.9
experience that is relevant to the style of mineralisation and type
of deposit under consideration to qualify him as a Competent
Person as defined in the JORC Code, 2012. Neither Mr. de
Klerk nor Xstract have any material interest or entitlement,
direct or indirect, in the securities of Aspire Mining Limited or
any companies associated with Aspire Mining Limited. Fees for
work undertaken are on a time and materials basis. Mr. de Klerk
consents to the inclusion of the Coal Resources based on his
information in the form and context in which it appears.
The Coal Reserves at Ovoot Project documented in this release
are stated in accordance with the guidelines set out in the
JORC Code, 2012. They are based on information compiled and
reviewed by Mr. Kevin Irving who is a Fellow of the Australasian
Institute of Mining and Metallurgy (Member #223116) and is a
full time employee of Xstract Mining Consultants Pty Ltd. He has
more than 35 years’ experience in the mining of coal deposits
and the estimation of Coal Reserves and the assessment of
Modifying Factors. Mr. Irving has sufficient experience that is
relevant to the style of mineralisation and type of deposit under
consideration to qualify him as a Competent Person as defined
in the JORC Code, 2012. Neither Mr. Irving nor Xstract have
any material interest or entitlement, direct or indirect, in the
securities of Aspire Mining Limited or any companies associated
with Aspire Mining Limited. Fees for work undertaken are on a
time and materials basis. Mr. Irving consents to the inclusion
of the Coal Reserves based on his information in the form and
context in which it appears.
Competent Persons Statement – Nuurstei Coking Coal Project
The information in this report that relates to Reporting of Coal
Resources at Nuurstei Project, is based on information compiled
under the supervision of, and reviewed by, the Competent
Person, Mr Parbury, who is a full time employee of McElroy
Bryan Geological Services, is a Member of the Australasian
Institute of Mining and Metallurgy (101430) and who has no
conflict of interest with Aspire Mining Limited.
The reporting of Coal Resources for 13580X presented in this
report has been carried out in accordance with the ‘Australasian
Code for Reporting of Exploration Results, Mineral Resources
and Ore Reserves’, The JORC Code 2012 Edition prepared by
the Joint Ore Reserves Committee of the Australasian Institute
of Mining and Metallurgy, Australian Institute of Geoscientists
and Minerals Council of Australia (JORC).
Mr Parbury has sufficient experience that is relevant to the style
of mineralisation and type of deposit under consideration and to
the activity being undertaken to qualify as a Competent Person
as defined in the 2012 JORC Code. Mr Parbury consents to the
inclusion in the report of the matters based on his information
in the form and context in which it appears.
ASPIRE MINING LIMITED | ANNUAL REPORT 2019
OVOOT EARLY
DEVELOPMENT PROJECT
(OEDP)
FMS LLC converted the existing Ovoot Resource
Model to Surpac and assumed 5% dilution in the
re-blocking exercise for Whittle re-optimisations.
FMS then conducted an optimisation based on
trucking product to the rail at Erdenet (as opposed
to the assumption and economics of a rail
connection from Ovoot to Erdenet) and restricting
maximum production to 4 million tonnes per annum
being the current available rail capacity from
Erdenet to markets. The pit selections produce a
steady 4 Mtpa of saleable coal.
The OEDP Reserves for the OEDP have been
confirmed as:
Table 7: OEDP Reserves
Category
Probable Ore Reserve Ore
Open Pit OEDP
Probable Ore Reserve
Open Pit OEDP Plus
OEDP Extension
Coal Reserve
(adb) ROM Mt
Coal Reserve
Total Moisture
2.0% arb ROM Mt
ROM Coal (adb)
Ash Content %
ROM Coal (adb)
CSN%
36.8
53.8
37.6
54.9
17.2
18.0
7.9
8.5
Table 8: OEDP Marketable Reserves
Category
Probable Product Reserve
Ore Open Pit OEDP
Probable Product Reserve
Open Pit OEDP Plus OEDP
Extension
Marketable Coal
Reserve Total Moisture
10% arb Mt
Product Specification
adb Ash Content %
Product Specification
adb CSN%
32.2
46.2
10.5
10.5
8.5
8.5
OEDP Notes:
Competent Persons Statement – Ovoot Early Development Project
1. The
technical
information and competent persons
statements for the OEDP Reserves are reported in the
Company’s ASX announcements dated 28 February and
1 March 2019 which are available to view on the Company’s
website and the ASX Announcements platform.
2. The Company confirms that at this time it is not aware
of any new information or data that materially affects
the information included in the announcements, and that
all material assumptions underpinning the estimates
continue to apply and have not materially changed. On
completion, the OEDP Definitive Feasibility Study will
identify any new information, data or change to material
assumptions used in the OEDP Pre-Feasibility Study.
The OEDP Reserves in this release are stated in accordance to
the JORC Code, 2012. They are based on information compiled
and reviewed by Mr Julien Lawrence who is a Member of
the Australasian Institute of Mining and Metallurgy (Member
209746) and is a full-time employee of FMS LLC. He has more
than 20 years’ experience in the evaluation of coal deposits and
the estimation of coal resources. Mr Lawrence has sufficient
experience that is relevant to the style of mineralisation and type
of deposit under consideration to qualify him as a Competent
Person as defined in the JORC Code, 2012. Mr Lawrence has
no material interest or entitlement, direct or indirect, in the
securities of Aspire Mining Limited or any companies associated
with Aspire Mining Limited. Fees for work undertaken are on a
time and materials basis. Mr Lawrence consents to the inclusion
of the OEDP Reserves based on his information in the form and
context in which it appears.
xiii
ASPIRE MINING LIMITED | ANNUAL REPORT 2019
COMMUNITY
RELATIONS
Aspire believes that
in order to become a
successful, long-term operator in the mining sector
in Mongolia, it is crucial to engage and educate the
local community in the Khuvsgal Province, where
the Company’s Ovoot and Nuurstei Coking Coal
assets are located, on the benefits available from
the development of the projects.
The Company’s Community Relations Policy is
for open and transparent communication and
aims to build mutually beneficial partnerships
and sustainable relationships. Through active
community participation and education,
the
Company has found opportunities to positively
impact the community and provide opportunities
and funding that may not have necessarily existed
previously. The ultimate goal is to encourage local
suppliers and entrepreneurs to improve local
competitiveness and strengthen the economic
structure
reduce
improve
unemployment throughout the country.
incomes and
to
Images left to right, top to bottom: Local resident in the Bagh area receiving a medical check-up at the health
event organised at Tsetserleg soum earlier in the year; Operator Training for Heavy Machinery; Aspire local
Mongolian members; Local residents planting for the Greenhouse Project (photos top of next page).
xiv
ASPIRE MINING LIMITED | ANNUAL REPORT 2019 Major activities in 2019 included;
▲ Holding multiple open day events and
“Listen First” campaigns, where information
was disseminated regarding the Company’s
ongoing activities and plans.
▲ Arranged for a health event at Tsetserleg soum,
in cooperation with Khovsgol province’s Health
Center, to provide basic medical check-ups for
residents in remote areas.
▲ An ‘Information & Training Centre’ was created
in Tsetserleg soum to provide the community
with first-hand
the Ovoot
development.
information on
the
▲ As part of stakeholder engagement,
Company conducted a series of
training
activities for the general mining sector in the
target community. A total of 30 local citizens
are currently employed as information officers
whom recently undertook a trip to Baganuur
coal mine and have now exchanged their
experience with other mining stakeholders.
▲ Commenced a
through
training program called
“Northern Miners”
the Erdenet
Technical Institute, which has already seen 9
local residents receive a license to operate
heavy machinery. Aspire’s goal is to double
the next intake and create a number of new
courses including environmental sciences and
plant operators.
▲ Supported
local business
launched a greenhouse project
community with organised related trainings.
initiatives and
the
in
▲ Cooperated with
local non-government
organisations and community groups and
signed a “Memorandum of Understanding”
with roughly 10 groups to run joint projects for
the target social groups.
Aspire has invested approximately 660 million
MNT (approximately US$250,000) into the local
community. Once the OEDP is in operation it is
estimated that in the first decade it will contribute
roughly 2.3 trillion MNT (US$850 million) to the
Mongolian Government in royalties and taxes and
generate a total of 1,200 direct & indirect jobs.
xv
ASPIRE MINING LIMITED | ANNUAL REPORT 2019 RAIL INFRASTRUCTURE
INVESTMENT
Aspire currently owns an 80% interest in Northern
Railways LLC (NR), the Mongolian registered
company that owns the Rail Concession to build
the 547 kilometre long Erdenet to Ovoot Railway
which is part of the Northern Rail Corridor, a new
rail connection between China and Russia through
Mongolia.
The Concession Agreement with
the Mongolian Government is to build, operate
then transfer the railway to Government after
30 years. In this Concession NR is supported
by a consortium of experienced rail and bridge
engineering and construction groups including
China Gezhouba Group Corporation and China
Railways Construction Corp Bureau 20 Group.
In 2018 China Gezhouba Group funded and
completed a feasibility study for the rail route which
was lodged with the Mongolian rail authourities.
As part of the Second Belt and Road Forum held in
Beijing on 25 April 2019, NR signed a conditional
Engineering, Procurement and Construction (EPC)
Agreement with China Gezhouba International
Engineering Co Ltd and China Railway 20
Bureau Group Corporation as the nominated EPC
contractors. The EPC Contract contains a maximum
lump sum turnkey amount of US$1.58 billion
including all contingencies, inflation allowances
and a completion guarantee fee as well as
conservative geotechnical assumptions. The EPC
Contract is conditional on availability of funding
and meeting the remaining conditions precedent
for the Erdenet to Ovoot Rail Concession.
Further funding from China Gezhouba Group is
dependent on the operator of the central rail line
in Mongolia, Ulaanbaatar Railways JSC (UBTZ),
providing a guarantee of future rail capacity for NR
along the main line for 10 million tonnes per annum
(UBTZ have provided Aspire with a guarantee
of 4 million tonnes per annum for the life of the
OEDP). The Erdenet to Ovoot Rail concession has
a number of conditions precedent that needs to
be met before 20 February 2020.
xvi
Mr Lyu Zexiang, Chairman, CGGC and Mr David
Paull, Executive Chairman, Aspire, at the Second
Belt and Road Forum in Beijing April 2019.
ASPIRE MINING LIMITED | ANNUAL REPORT 2019 CORPORATE
There has been significant activity in the Company
from a corporate and funding perspective over
the year.
The Company completed a $15 million Strategic
Financing Transaction with major shareholder,
Mr Tserenpuntsag and Noble Group in December
2018, which saw the remaining Noble debt
converted into equity, Mr Tserenpuntsag invest $10
million and $1.7 million placed with professional
and sophisticated investors. Mr Tserenpuntsag
emerged as a 27.5% shareholder. This funding
ensured that the Company was well funded
through to an investment decision in relation to
the OEDP and with nil debt.
Expenditure has been less than expected as major
expenditures in relation to the OEDP Definitive
Feasibility Study have been delayed. At 30 June
2019, the Company held $11 million in cash.
On 6 September 2019, the Company entered into
a Subscription Agreement with Mr Tserenpuntsag
whereby the Company would place 1.6 billion
shares to Mr Tserenpuntsag for a total investment
of $33.5 million cash. This would be a change
in control transaction where Mr Tserenpuntsag
would end up with a 51% controlling interest. As
such, this transaction is subject to a shareholder
vote at a general meeting supported by an
Independent Experts Report opining on whether
the transaction is fair and reasonable in respect to
minority shareholders. This shareholder meeting
will be held in late November 2019.
xvii
ASPIRE MINING LIMITED | ANNUAL REPORT 2019 Aspire Mining Limited
Aspire Mining Limited
ABN 46 122 417 243
Annual Financial Report
30 June 2019
Aspire Mining Limited
Contents
Aspire Mining Limited
Page
CORPORATE INFORMATION ................................................................................................................... 1
DIRECTORS’ REPORT .............................................................................................................................. 2
AUDITOR’S INDEPENDENCE DECLARATION ...................................................................................... 16
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME .. 17
CONSOLIDATED STATEMENT OF FINANCIAL POSITION .................................................................. 18
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY .................................................................. 19
CONSOLIDATED STATEMENT OF CASH FLOWS ............................................................................... 20
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS ............................................................ 21
DIRECTORS’ DECLARATION ................................................................................................................. 52
INDEPENDENT AUDITOR’S REPORT ................................................................................................... 53
Aspire Mining Limited
ABN 46 122 417 243
Annual Financial Report
30 June 2019
- 1 -
Aspire Mining Limited
Solicitors
Corrs Chambers Westgarth Lawyers
Brookfield Place Tower 2
123 St Georges Terrace
PERTH WA 6000
Bankers
National Australia Bank
Level 1, 1238 Hay Street
WEST PERTH WA 6005
Auditors
HLB Mann Judd
Level 4, 130 Stirling Street
PERTH WA 6000
KPMG
#602, Blue Sky Tower, Peace Avenue 17,
1 Khoroo Sukhbaatar District
ULAANBAATAR 14240 MONGOLIA
Securities Exchange Listing
AKM
Website
www.aspiremininglimited.com
CORPORATE INFORMATION
ABN 46 122 417 243
Directors
Mr David Paull (Executive Chairman)
Mr Gan-Ochir Zunduisuren (Executive Director)
Mr Boldbaatar Bat-Amgalan (Executive Director)
Mr Neil Lithgow (Non-Executive Director)
Ms Hannah Badenach (Non-Executive Director)
Mr Alexander Passmore (Non-Executive Director)
Mr Achit-Erdene Darambazar (Non-Executive
Director)
Company secretary
Mr Philip Rundell
Registered office
Level 9, 182 St Georges Terrace,
PERTH WA, AUSTRALIA 6000
Telephone:
Facsimile:
Email: info@aspiremininglimited.com
(08) 9287 4555
(08) 9321 4914
Principal place of business
AUSTRALIA
Level 9, 182 St Georges Terrace,
PERTH WA 6000
MONGOLIA
Sukhbaatar District, 1st Khooro
Chinggis Avenue-8,
Altai Tower, 3rd Floor, Room 302
ULAANBAATAR
Share Register
Security Transfer Australia Pty Ltd
770 Canning Highway
APPLECROSS WA 6153
T: 1300 992 916
F: +61 8 9315 2233
E: registrar@securitytransfer.com.au
- 1 -
Aspire Mining Limited
- 2 -
Aspire Mining Limited
CORPORATE INFORMATION
ABN 46 122 417 243
Directors
Mr David Paull (Executive Chairman)
Mr Gan-Ochir Zunduisuren (Executive Director)
Mr Boldbaatar Bat-Amgalan (Executive Director)
Mr Neil Lithgow (Non-Executive Director)
Ms Hannah Badenach (Non-Executive Director)
Mr Alexander Passmore (Non-Executive Director)
Mr Achit-Erdene Darambazar (Non-Executive
Bankers
Solicitors
Corrs Chambers Westgarth Lawyers
Brookfield Place Tower 2
123 St Georges Terrace
PERTH WA 6000
National Australia Bank
Level 1, 1238 Hay Street
WEST PERTH WA 6005
Auditors
HLB Mann Judd
Level 4, 130 Stirling Street
PERTH WA 6000
KPMG
#602, Blue Sky Tower, Peace Avenue 17,
1 Khoroo Sukhbaatar District
ULAANBAATAR 14240 MONGOLIA
Securities Exchange Listing
AKM
Website
www.aspiremininglimited.com
Director)
Company secretary
Mr Philip Rundell
Registered office
Level 9, 182 St Georges Terrace,
PERTH WA, AUSTRALIA 6000
Telephone:
(08) 9287 4555
Facsimile:
(08) 9321 4914
Email: info@aspiremininglimited.com
Principal place of business
AUSTRALIA
Level 9, 182 St Georges Terrace,
PERTH WA 6000
MONGOLIA
Sukhbaatar District, 1st Khooro
Chinggis Avenue-8,
Altai Tower, 3rd Floor, Room 302
ULAANBAATAR
Share Register
Security Transfer Australia Pty Ltd
770 Canning Highway
APPLECROSS WA 6153
T: 1300 992 916
F: +61 8 9315 2233
E: registrar@securitytransfer.com.au
DIRECTORS’ REPORT
Your Directors submit the annual financial report of the Group consisting of Aspire Mining Limited (“Aspire” or
“Company”) and the entities it controlled during the financial year ended 30 June 2019.
In order to comply with the provisions of the Corporations Act 2001, the Directors report as follows:
Directors
The names of Directors who held office during or since the end of the year and until the date of this report are
as follows. Directors were in office for this entire period unless otherwise stated.
Mr David Paull
Mr Gan-Ochir Zunduisuren
Mr Boldbaatar Bat-Amgalan
Mr Neil Lithgow
Ms Hannah Badenach
Mr Alexander Passmore
Mr Achit-Erdene Darambazar Non-Executive Director (appointed 7 December 2018)
Executive Chairman
Executive Director
Executive Director (appointed 7 December 2018)
Non-Executive Director
Non-Executive Director
Non-Executive Director
Names, qualifications, experience and special responsibilities
Mr David Paull
Executive Chairman
Qualifications: B.Com, FSIA, MBA (Cornell)
Mr Paull has over 28 years’ experience in resource business development and industrial minerals marketing.
For the past 7 years, Mr Paull has been Managing Director of Aspire after being involved in the recapitalisation
of the Company and redirection to targeting Mongolian coking coal assets.
Mr Paull was appointed as Executive Director of the Company on 12 February 2010 and as Managing Director
on 1 July 2010. With the retirement of the Non-Executive Chairman in March 2018, Mr Paull became Executive
Chairman.
Mr Paull has had no other ASX listed public company directorships in the last three years. Mr Paull was
appointed a Director of AIM listed Hunter Resources PLC on 28 December 2012 and resigned on 2 September
2018.
Mr Gan-Ochir Zunduisuren
Executive Director
Qualifications: B.Eng, MSGF (Stern)
Mr Zunduisuren has over 15 years of experience in the resource sector including underground zinc mining,
gold mining and mining business development in Mongolia and Canada. Mr Zunduisuren is Executive Director
and co-founder of Altai Gold LLC, a mineral resource focused investment company, and was a key part of the
syndicate that made the Ovoot Coking Coal project discovery.
Mr Zunduisuren has a Degree in Mining Engineering from the Mongolian University of Science and Technology
and a MSc in Global Finance from NYU Stern School of Business and HKUST.
Mr Zunduisuren has had no listed public company directorships in the last three years.
DIRECTORS’ REPORT (continued)
DIRECTORS’ REPORT (continued)
- 3 -
- 4 -
Aspire Mining Limited
Aspire Mining Limited
Names, qualifications, experience and special responsibilities (continued)
Mr Boldbaatar Bat-Amgalan
Executive Director (appointed 7th December 2018)
Mr Boldbaatar Bat-Amgalan has had senior roles in public relations and publishing and was previously a
director of Erdenet Mining Company. He also previously held senior roles in the Government of Mongolia,
including the State Secretary for the Ministry of Foreign Affairs, and Chairman of the Communication
Regulatory Commission.
Mr Bat-Amgalan has had no listed public company directorships in the last three years.
Mr Neil Lithgow
Non-Executive Director
Qualifications : MSc, F.Fin, M.AusIMM
Mr Lithgow is a geologist by profession with over 27 years’ experience in mineral exploration, economics and
mining feasibility studies, covering base metals, coal, iron ore and gold.
Mr Lithgow is a member of the Australian Institute of Mining and Metallurgy and the Financial Services Institute
of Australia.
Mr Lithgow has previously worked for Aquila Resources Limited and Eagle Mining Corporation NL and is
currently a Non-Executive Director of Bauxite Resources Limited (appointed 15 May 2006). Mr Lithgow has
had no other listed public company directorships in the last three years.
Ms Hannah Badenach
Non-Executive Director
Qualifications: BA, LLB (Hons)
Ms Badenach is currently Executive Director Mongolia & Base Metals at Noble Resources Limited.
Ms Badenach is a lawyer, having practiced law for several years in Asia, including two years in Mongolia,
starting in 2004 with Lynch & Mahoney. Ms Badenach has experience in management and development within
Mongolia. Ms Badenach was Managing Director of QGX Mongol LLC from 2006, where Ms Badenach was
responsible for the general management of the company until it was sold in 2008.
Ms Badenach holds a Bachelor of Laws (Hons) and a Bachelor of Arts from the University of Tasmania.
Directors
Ms Badenach is also a Director of ASX listed and Mongolian focussed explorer, Xanadu Mines Limited
(appointed 4 October 2011). Ms Badenach has had no other listed public company directorships in the last
three years.
Mr Alexander Passmore
Non-Executive Director
Qualifications: B.Sc(Hons) ASIA MAusIMM
Mr Passmore is a qualified geologist and experienced and well-regarded corporate executive with a strong
financial and technical background in the resource sector. Alexander has a diverse background having held
technical roles in the industry and then senior positions in both the institutional debt financing and equity capital
market arenas.
Mr Passmore has a Bachelor of Science Degree with first class honours in Geology.
Names, qualifications, experience and special responsibilities (continued)
Mr Passmore was a director of Equator Resources Ltd from September 2016 to July 2017. He was appointed
Managing Director of Cockatoo Island NL in October 2016 and Rox Resources Limited on 30 April 2019. He
has had no other listed public company directorships in the last three years.
Mr Achit-Erdene Darambazar
Non-Executive Director (appointed 7th December 2018)
Mr Achit-Erdene Darambazar is financial adviser to Mr Tserenpuntsag and President and CEO of Mongolian
International Capital Corporation LLC (MICC), a leading Mongolian investment banking firm and the first
investment advisory, stock underwriting and brokerage firm in Mongolia.
He acted as lead advisor for the first bond offerings on the local stock exchange by major Mongolian
companies, MCS and Gobi Corporation. He has also advised on a number of high-profile transactions in
Mongolia, including the privatisation of the Trade and Development Bank of Mongolia and Agricultural Bank.
Mr. Achit-Erdene has completed a Masters degree in International Relations from Columbia University and
holds a Bachelors degree from Middlebury College.
Mr Darambazar has had no listed public company directorships in the last three years.
Company Secretary
Mr Philip Rundell
Company Secretary
Qualifications: Dip BS (Accounting) CA
Mr Rundell has had over 25 years’ experience as a Partner and Director of Coopers & Lybrand and Ferrier
Hodgson, specialising in company reconstructions and corporate recovery. Mr Rundell has provided
management accounting and company secretarial services to a number of listed companies.
Interests in the Shares and Options of the Company and Related Bodies Corporate
As at the date of this report, the relevant interests of the current Directors in shares, options and rights of the
Company are as follows:
Mr David Paull1
Mr Gan-Ochir Zunduisuren
Mr Boldbaatar Bat-Amgalan
Mr Neil Lithgow
Ms Hannah Badenach
Mr Alex Passmore
Mr Achit-Erdene Darambazar
Number of Fully Paid
Number of Options
Number of
Ordinary Shares
over Ordinary
Shares
26,052,791
47,392,203
237,278,501
13,890,476
-
-
-
Performance
Rights over
Ordinary Shares
45,833,333
30,500,000
36,250,000
18,083,333
-
-
-
1,145,833
6,354,167
2,083,334
12,000,000
-
-
-
1. Mr David Paull is a Director of 2R’s Pty Ltd, which is a beneficial owner of 24,736,791 ordinary shares, 1,145,833
options and 45,833,333 performance rights. Mr David Paull is also a Director and shareholder of Paulkiner Pty
Ltd, which is a beneficial owner of 1,316,000 ordinary shares.
There were no options granted to Directors of the Company during or since the end of the financial year as
part of their remuneration, other than 12,000,000 options exercisable at 1.8 cents on or before 11 December
2019 issued to the Non-Executive Director, Alex Passmore, as part of his remuneration.
DIRECTORS’ REPORT (continued)
DIRECTORS’ REPORT (continued)
Names, qualifications, experience and special responsibilities (continued)
Names, qualifications, experience and special responsibilities (continued)
- 3 -
- 4 -
Aspire Mining Limited
Aspire Mining Limited
Mr Boldbaatar Bat-Amgalan
Executive Director (appointed 7th December 2018)
Mr Boldbaatar Bat-Amgalan has had senior roles in public relations and publishing and was previously a
director of Erdenet Mining Company. He also previously held senior roles in the Government of Mongolia,
including the State Secretary for the Ministry of Foreign Affairs, and Chairman of the Communication
Regulatory Commission.
Mr Bat-Amgalan has had no listed public company directorships in the last three years.
Mr Neil Lithgow
Non-Executive Director
Qualifications : MSc, F.Fin, M.AusIMM
Mr Lithgow is a geologist by profession with over 27 years’ experience in mineral exploration, economics and
mining feasibility studies, covering base metals, coal, iron ore and gold.
Mr Lithgow is a member of the Australian Institute of Mining and Metallurgy and the Financial Services Institute
of Australia.
Mr Lithgow has previously worked for Aquila Resources Limited and Eagle Mining Corporation NL and is
currently a Non-Executive Director of Bauxite Resources Limited (appointed 15 May 2006). Mr Lithgow has
had no other listed public company directorships in the last three years.
Ms Hannah Badenach
Non-Executive Director
Qualifications: BA, LLB (Hons)
Mr Passmore was a director of Equator Resources Ltd from September 2016 to July 2017. He was appointed
Managing Director of Cockatoo Island NL in October 2016 and Rox Resources Limited on 30 April 2019. He
has had no other listed public company directorships in the last three years.
Mr Achit-Erdene Darambazar
Non-Executive Director (appointed 7th December 2018)
Mr Achit-Erdene Darambazar is financial adviser to Mr Tserenpuntsag and President and CEO of Mongolian
International Capital Corporation LLC (MICC), a leading Mongolian investment banking firm and the first
investment advisory, stock underwriting and brokerage firm in Mongolia.
He acted as lead advisor for the first bond offerings on the local stock exchange by major Mongolian
companies, MCS and Gobi Corporation. He has also advised on a number of high-profile transactions in
Mongolia, including the privatisation of the Trade and Development Bank of Mongolia and Agricultural Bank.
Mr. Achit-Erdene has completed a Masters degree in International Relations from Columbia University and
holds a Bachelors degree from Middlebury College.
Mr Darambazar has had no listed public company directorships in the last three years.
Company Secretary
Mr Philip Rundell
Company Secretary
Qualifications: Dip BS (Accounting) CA
Ms Badenach is currently Executive Director Mongolia & Base Metals at Noble Resources Limited.
Ms Badenach is a lawyer, having practiced law for several years in Asia, including two years in Mongolia,
starting in 2004 with Lynch & Mahoney. Ms Badenach has experience in management and development within
Mongolia. Ms Badenach was Managing Director of QGX Mongol LLC from 2006, where Ms Badenach was
responsible for the general management of the company until it was sold in 2008.
Mr Rundell has had over 25 years’ experience as a Partner and Director of Coopers & Lybrand and Ferrier
Hodgson, specialising in company reconstructions and corporate recovery. Mr Rundell has provided
management accounting and company secretarial services to a number of listed companies.
Interests in the Shares and Options of the Company and Related Bodies Corporate
As at the date of this report, the relevant interests of the current Directors in shares, options and rights of the
Company are as follows:
Ms Badenach holds a Bachelor of Laws (Hons) and a Bachelor of Arts from the University of Tasmania.
Directors
Ms Badenach is also a Director of ASX listed and Mongolian focussed explorer, Xanadu Mines Limited
(appointed 4 October 2011). Ms Badenach has had no other listed public company directorships in the last
three years.
Mr Alexander Passmore
Non-Executive Director
Qualifications: B.Sc(Hons) ASIA MAusIMM
Mr David Paull1
Mr Gan-Ochir Zunduisuren
Mr Boldbaatar Bat-Amgalan
Mr Neil Lithgow
Ms Hannah Badenach
Mr Alex Passmore
Mr Achit-Erdene Darambazar
Number of Fully Paid
Ordinary Shares
Number of Options
over Ordinary
Shares
26,052,791
47,392,203
-
237,278,501
13,890,476
-
-
1,145,833
-
-
6,354,167
2,083,334
12,000,000
-
Number of
Performance
Rights over
Ordinary Shares
45,833,333
30,500,000
-
36,250,000
18,083,333
-
-
Mr Passmore is a qualified geologist and experienced and well-regarded corporate executive with a strong
financial and technical background in the resource sector. Alexander has a diverse background having held
technical roles in the industry and then senior positions in both the institutional debt financing and equity capital
market arenas.
Mr Passmore has a Bachelor of Science Degree with first class honours in Geology.
1. Mr David Paull is a Director of 2R’s Pty Ltd, which is a beneficial owner of 24,736,791 ordinary shares, 1,145,833
options and 45,833,333 performance rights. Mr David Paull is also a Director and shareholder of Paulkiner Pty
Ltd, which is a beneficial owner of 1,316,000 ordinary shares.
There were no options granted to Directors of the Company during or since the end of the financial year as
part of their remuneration, other than 12,000,000 options exercisable at 1.8 cents on or before 11 December
2019 issued to the Non-Executive Director, Alex Passmore, as part of his remuneration.
DIRECTORS’ REPORT (continued)
DIRECTORS’ REPORT (continued)
- 5 -
- 6 -
Aspire Mining Limited
Aspire Mining Limited
During the 2018 financial year 55,000,000 performance rights were issued to David Paull and 101,800,000
performance rights granted to the Non-Executive Directors. Of those performance rights, 9,166,667
performance rights issued to David Paull and 16,966,667 to the Non-Executive Directors vested and as a
result, 26,133,334 Ordinary Shares were issued to the Directors on 13 July 2018.
There are no unpaid amounts on the shares issued.
The OEDP involves mining a low ash and high yielding coal from a starter pit that sits within the previously
defined Ovoot orebody and construction of a new private haul road from Ovoot to the rail head at the town of
Erdenet.
The Company has completed a pre-feasibility feasibility study and will progress with a definitive feasibility study
for the mine and road components of the OEDP to support project financing and a final decision to mine.
At the date of this report, unissued ordinary shares of the Company under option and performance rights are:
Review of financial conditions
Type
Options
Performance Rights
Total
Expiry Date
11 December 2019
Various
Exercise Price
$0.018
-
Number of Shares
700,722,235
161,083,330
861,805,565
Dividends
No dividends have been paid or declared since the start of the financial year and the Directors do not
recommend the payment of a dividend in respect of the financial year.
Principal Activities
The principal activity of the Group during the year was the completion of the Ovoot Early Development Project
(OEDP) Pre-Feasibility Study, progression for the approvals, completion of studies, and funding towards the
development of the OEDP.
Review of Operations
Aspire Mining Limited (“Aspire” or the “Company”) is focused on the exploration and development of
metallurgical coal assets in Mongolia. Aspire owns:
(a) a 100% interest in the large scale, world class Ovoot Coking Coal Project; and
(b) a 90% interest in the Nuurstei Coking Coal Project.
Significant events after balance date
Aspire’s Mongolian rail infrastructure subsidiary, Northern Railways LLC, holds a Concession Agreement from
the Mongolian Government to build and operate 549km of rail from the town of Erdenet to the Ovoot Coking
Coal Project in northern Mongolia. The Erdenet to Ovoot Railway will provide a higher capacity and lower cost
transport alternative to road for the Ovoot and Nuurstei Coking Coal Projects when the rail is constructed.
In August 2018, the Company entered into definitive and binding documentation with existing substantial
shareholder, Mr. Tserenpuntsag Tserendamba, to invest $10 million as part of a $11.7 million strategic
financing package to implement the OEDP. Also in August 2018, the Company entered into a binding
agreement with lender and major shareholder, Noble Resources International Pte Ltd (Noble), to repay up to
US$2.4 million (plus interest accruing on that amount) of the outstanding amount owing under the facility with
Noble by way of the issue of Shares at A$0.021 (2.1 cents) per Share. Given the funding described above, the
Company has had no further need to borrow.
The Company’s shareholders approved the $11.7 million placements and the debt for equity transactions at
the annual general meeting held on 28 November 2018.
Other than the above, there has not been any material matter or circumstance that has arisen after balance
date that has significantly affected, or may significantly affect, the operations of the Group, the results of those
operations, or the state of affairs of the Group in future financial periods.
In September 2019, the Company entered into a Subscription Agreement with Mr. Tserenpuntsag
Tserendamba to invest a further $33.5 million by way of a Placement to take his interest in the Company from
27.5% to 51%. Completion of the Placement requires the approval of the Company’s shareholders.
Likely developments and expected results
at the earliest opportunity.
The Group will continue with activities towards meeting its objective of developing the OEDP into production
At balance date, the Group had $11,136,142 (2018: $7,488,401) in cash assets.
A placement to raise $33.5 million before costs has been agreed with substantial shareholder, Mr.
Tserenpuntsag Tserendamba, subject to shareholder approval at a meeting proposed to be held late in
November 2019. Further funds may be available from the exercise of 1.8 cent options on or before 11
December 2019.
These sources of funding will be sufficient to meet required community relations activities, approvals, permits
and evaluation activities to advance towards development of the OEDP.
Further raisings or other means of funding will be required for the capital infrastructure requirements for full
development of the OEDP and the associated haul road.
Operating results for the year
$6,980,272).
The Group made an operating loss after tax of $6,200,307 for the year ended 30 June 2019 (2018: Loss
Significant changes in the state of affairs
in the state of affairs of the Group.
Since the previous Annual Financial Report and during the financial year there has been no significant change
In September 2019, the Company entered into a Subscription Agreement with existing substantial shareholder,
Mr. Tserenpuntsag Tserendamba, to complete a Placement for 1,595.9 million shares at 2.1 cents per share
to raise $33.5 million before costs to further fund the OEDP pre-development activities and for general working
capital. The OEDP will involve mining a low ash and high yielding coal from a starter pit that sits within the
previously defined Ovoot orebody and construction of a new private haul road.
The Placement to Mr Tserenpuntsag is conditional upon an independent expert report opining that the
Placement and its outcomes are reasonable, if not fair, to the Company’s shareholders and the shareholders
considering, and if thought fit, approving the Placement at a meeting of shareholders.
Following the Placement there is an intended restructuring of the Aspire Board of Directors and management
roles and a 1 for 10 consolidation of the Aspire securities on issue.
DIRECTORS’ REPORT (continued)
DIRECTORS’ REPORT (continued)
- 5 -
- 6 -
Aspire Mining Limited
Aspire Mining Limited
During the 2018 financial year 55,000,000 performance rights were issued to David Paull and 101,800,000
performance rights granted to the Non-Executive Directors. Of those performance rights, 9,166,667
performance rights issued to David Paull and 16,966,667 to the Non-Executive Directors vested and as a
result, 26,133,334 Ordinary Shares were issued to the Directors on 13 July 2018.
There are no unpaid amounts on the shares issued.
At the date of this report, unissued ordinary shares of the Company under option and performance rights are:
Performance Rights
Various
-
11 December 2019
$0.018
Expiry Date
Exercise Price
Number of Shares
700,722,235
161,083,330
861,805,565
Type
Options
Total
Dividends
No dividends have been paid or declared since the start of the financial year and the Directors do not
recommend the payment of a dividend in respect of the financial year.
The principal activity of the Group during the year was the completion of the Ovoot Early Development Project
(OEDP) Pre-Feasibility Study, progression for the approvals, completion of studies, and funding towards the
Principal Activities
development of the OEDP.
Review of Operations
Aspire Mining Limited (“Aspire” or the “Company”) is focused on the exploration and development of
metallurgical coal assets in Mongolia. Aspire owns:
(a) a 100% interest in the large scale, world class Ovoot Coking Coal Project; and
(b) a 90% interest in the Nuurstei Coking Coal Project.
Aspire’s Mongolian rail infrastructure subsidiary, Northern Railways LLC, holds a Concession Agreement from
the Mongolian Government to build and operate 549km of rail from the town of Erdenet to the Ovoot Coking
Coal Project in northern Mongolia. The Erdenet to Ovoot Railway will provide a higher capacity and lower cost
transport alternative to road for the Ovoot and Nuurstei Coking Coal Projects when the rail is constructed.
In August 2018, the Company entered into definitive and binding documentation with existing substantial
shareholder, Mr. Tserenpuntsag Tserendamba, to invest $10 million as part of a $11.7 million strategic
financing package to implement the OEDP. Also in August 2018, the Company entered into a binding
agreement with lender and major shareholder, Noble Resources International Pte Ltd (Noble), to repay up to
US$2.4 million (plus interest accruing on that amount) of the outstanding amount owing under the facility with
Noble by way of the issue of Shares at A$0.021 (2.1 cents) per Share. Given the funding described above, the
Company has had no further need to borrow.
The OEDP involves mining a low ash and high yielding coal from a starter pit that sits within the previously
defined Ovoot orebody and construction of a new private haul road from Ovoot to the rail head at the town of
Erdenet.
The Company has completed a pre-feasibility feasibility study and will progress with a definitive feasibility study
for the mine and road components of the OEDP to support project financing and a final decision to mine.
Review of financial conditions
At balance date, the Group had $11,136,142 (2018: $7,488,401) in cash assets.
A placement to raise $33.5 million before costs has been agreed with substantial shareholder, Mr.
Tserenpuntsag Tserendamba, subject to shareholder approval at a meeting proposed to be held late in
November 2019. Further funds may be available from the exercise of 1.8 cent options on or before 11
December 2019.
These sources of funding will be sufficient to meet required community relations activities, approvals, permits
and evaluation activities to advance towards development of the OEDP.
Further raisings or other means of funding will be required for the capital infrastructure requirements for full
development of the OEDP and the associated haul road.
Operating results for the year
The Group made an operating loss after tax of $6,200,307 for the year ended 30 June 2019 (2018: Loss
$6,980,272).
Significant changes in the state of affairs
Since the previous Annual Financial Report and during the financial year there has been no significant change
in the state of affairs of the Group.
Significant events after balance date
In September 2019, the Company entered into a Subscription Agreement with existing substantial shareholder,
Mr. Tserenpuntsag Tserendamba, to complete a Placement for 1,595.9 million shares at 2.1 cents per share
to raise $33.5 million before costs to further fund the OEDP pre-development activities and for general working
capital. The OEDP will involve mining a low ash and high yielding coal from a starter pit that sits within the
previously defined Ovoot orebody and construction of a new private haul road.
The Placement to Mr Tserenpuntsag is conditional upon an independent expert report opining that the
Placement and its outcomes are reasonable, if not fair, to the Company’s shareholders and the shareholders
considering, and if thought fit, approving the Placement at a meeting of shareholders.
Following the Placement there is an intended restructuring of the Aspire Board of Directors and management
roles and a 1 for 10 consolidation of the Aspire securities on issue.
The Company’s shareholders approved the $11.7 million placements and the debt for equity transactions at
the annual general meeting held on 28 November 2018.
Other than the above, there has not been any material matter or circumstance that has arisen after balance
date that has significantly affected, or may significantly affect, the operations of the Group, the results of those
operations, or the state of affairs of the Group in future financial periods.
In September 2019, the Company entered into a Subscription Agreement with Mr. Tserenpuntsag
Tserendamba to invest a further $33.5 million by way of a Placement to take his interest in the Company from
27.5% to 51%. Completion of the Placement requires the approval of the Company’s shareholders.
Likely developments and expected results
The Group will continue with activities towards meeting its objective of developing the OEDP into production
at the earliest opportunity.
- 7 -
Aspire Mining Limited
DIRECTORS’ REPORT (continued)
Risk management
The Board is responsible for ensuring that risks are identified on a timely basis and that activities are aligned
with the risks identified by the Board. The Group believes that it is crucial for all Board members to be a part
of this process and as such the Board has not established a separate risk management committee. The Board
has a number of mechanisms in place to ensure that management’s objectives and activities are aligned with
the risks identified by the Board. These include the Board approval of strategic plans which includes initiatives
designed to meet stakeholder needs and expectations and to manage business risk, and the implementation
of Board approved operating plans and budgets and Board monitoring of progress against these budgets.
Corporate governance
Details of the Company’s Corporate Governance policies are contained within the Corporate Governance Plan
adopted by the Board. The Corporate Governance Statement for the year ended 30 June 2018 can be found
on the Company’s website at http://www.aspiremininglimited.com. The Corporate Governance Statement for
the year ended 30 June 2019 will be available on the Company’s website and the ASX announcements
platform following announcement with the Company’s Annual Report in October 2019.
Environmental legislation
The Company is subject to significant environmental and monitoring requirements in respect of its natural
resources exploration activities. The Directors are not aware of any material breaches of these requirements
during the year.
Indemnification and insurance of Directors and officers
The Company has agreed to indemnify all the Directors and officers of the Group for any liabilities to another
person (other than the Group or related bodies corporate) that may arise from their position as Directors or
officers of the Company and its controlled entities, except where the liability arises out of conduct involving a
lack of good faith. During the financial year the Company paid a premium in respect of a contract insuring the
Directors and Officers of the Company and its controlled entities against any liability incurred in the course of
their duties to the extent permitted by the Corporations Act 2001. The contract of insurance prohibits disclosure
of the nature of the liability and the amount of the premium. The Company has not otherwise, during or since
the end of the financial year, except to the extent permitted by law, indemnified or agreed to indemnify an
officer or auditor of the Company or of any related body corporate against a liability incurred as such an officer
or auditor.
Remuneration Report (audited)
This report outlines the remuneration arrangements in place for the Key Management Personnel of the
Company and its controlled entities for the financial year ended 30 June 2019, as follows:
Mr David Paull
Mr Gan-Ochir Zunduisuren
Mr Boldbaatar Bat-Amgalan
Mr Neil Lithgow
Ms Hannah Badenach
Mr Alexander Passmore
Mr Achit-Erdene Darambazar
(Executive Chairman)
(Executive Director)
(Executive Director)
(Non-Executive Director)
(Non-Executive Director)
(Non-Executive Director)
(Non-Executive Director)
Remuneration philosophy
The performance of the Group depends upon the quality of the Directors and executives. The philosophy of
the Group in determining remuneration levels is to:
- 7 -
- 8 -
Aspire Mining Limited
Aspire Mining Limited
DIRECTORS’ REPORT (continued)
Risk management
The Board is responsible for ensuring that risks are identified on a timely basis and that activities are aligned
with the risks identified by the Board. The Group believes that it is crucial for all Board members to be a part
of this process and as such the Board has not established a separate risk management committee. The Board
has a number of mechanisms in place to ensure that management’s objectives and activities are aligned with
the risks identified by the Board. These include the Board approval of strategic plans which includes initiatives
designed to meet stakeholder needs and expectations and to manage business risk, and the implementation
of Board approved operating plans and budgets and Board monitoring of progress against these budgets.
Corporate governance
Details of the Company’s Corporate Governance policies are contained within the Corporate Governance Plan
adopted by the Board. The Corporate Governance Statement for the year ended 30 June 2018 can be found
on the Company’s website at http://www.aspiremininglimited.com. The Corporate Governance Statement for
the year ended 30 June 2019 will be available on the Company’s website and the ASX announcements
platform following announcement with the Company’s Annual Report in October 2019.
Environmental legislation
during the year.
The Company is subject to significant environmental and monitoring requirements in respect of its natural
resources exploration activities. The Directors are not aware of any material breaches of these requirements
Indemnification and insurance of Directors and officers
The Company has agreed to indemnify all the Directors and officers of the Group for any liabilities to another
person (other than the Group or related bodies corporate) that may arise from their position as Directors or
officers of the Company and its controlled entities, except where the liability arises out of conduct involving a
lack of good faith. During the financial year the Company paid a premium in respect of a contract insuring the
Directors and Officers of the Company and its controlled entities against any liability incurred in the course of
their duties to the extent permitted by the Corporations Act 2001. The contract of insurance prohibits disclosure
of the nature of the liability and the amount of the premium. The Company has not otherwise, during or since
the end of the financial year, except to the extent permitted by law, indemnified or agreed to indemnify an
officer or auditor of the Company or of any related body corporate against a liability incurred as such an officer
or auditor.
Remuneration Report (audited)
This report outlines the remuneration arrangements in place for the Key Management Personnel of the
Company and its controlled entities for the financial year ended 30 June 2019, as follows:
Mr David Paull
(Executive Chairman)
Mr Gan-Ochir Zunduisuren
(Executive Director)
Mr Boldbaatar Bat-Amgalan
(Executive Director)
Mr Neil Lithgow
(Non-Executive Director)
Ms Hannah Badenach
(Non-Executive Director)
Mr Alexander Passmore
(Non-Executive Director)
Mr Achit-Erdene Darambazar
(Non-Executive Director)
Remuneration philosophy
The performance of the Group depends upon the quality of the Directors and executives. The philosophy of
the Group in determining remuneration levels is to:
DIRECTORS’ REPORT (continued)
Remuneration Report (audited)
1. set competitive remuneration packages to attract and retain high calibre employees;
2.
link executive rewards to shareholder value creation; and
3. establish appropriate performance hurdles for variable executive remuneration.
In considering the Group’s performance and returns on shareholder wealth, the Board has regard to the
following indicators of performance in respect of the current financial year and the previous four financial years:
2019
$
2018
$
2017
$
2016
$
2015
$
Revenue
325,741
216,309
4,133
30,210
66,887
Net profit/(loss) after tax
(6,200,307)
(6,980,272)
(4,883,119)
(2,312,480)
(15,108,329)
Basic loss per share
(0.0020)
(0.0035)
(0.0052)
(0.0025)
(0.0215)
Share price at year-end
0.016
0.022
0.018
0.025
0.022
Remuneration committee
If appointed, the Remuneration Committee of the Board of Directors is responsible for determining and
reviewing compensation arrangements for the Director and the senior management team. Where a
Remuneration Committee does not exist, its role is carried out by the Board of Directors. A Remuneration
Committee was reformed in September 2018.
The Remuneration Committee assesses the appropriateness of the nature and amount of remuneration of
Directors and senior executives on a periodic basis by reference to relevant employment market conditions
with an overall objective of ensuring maximum stakeholder benefit from the retention of a high quality Board
and executive team.
Remuneration structure
In accordance with best practice Corporate Governance, the structure of Non-Executive Directors and
executive remuneration is separate and distinct.
Non-Executive Director Remuneration
The Board seeks to set aggregate remuneration at a level that provides the Group with the ability to attract
and retain Directors of the highest calibre, whilst incurring a cost that is acceptable to shareholders. The ASX
Listing Rules specify that the aggregate remuneration of Non-Executive Directors shall be determined from
time to time by a general meeting. The latest determination was at the General Meeting held on 19 August
2011 when shareholders approved an aggregate remuneration for Non-Executive Directors of up to $600,000
per year.
If and when applicable, the Board may consider advice from external consultants as well as the fees paid to
Non-Executive Directors of comparable companies when undertaking the annual remuneration review
process.
Each Director is entitled to receive a fee for being a Director of the Company. Economic and other
circumstances have meant that the Non-Executive Directors have not received fee payments from September
2015. From 1 January 2019, the remuneration to a Non-Executive Director has been set at $60,000 per annum.
This level of remuneration was reviewed and agreed by the Board following recommendations from the
Remuneration Committee.
The remuneration of Non-Executive Directors for the year ended 30 June 2019 is detailed in the Remuneration
of Key Management Personnel section of this report in Table 1.
DIRECTORS’ REPORT (continued)
Remuneration Report (audited) (continued)
DIRECTORS’ REPORT (continued)
Remuneration Report (audited) (continued)
- 9 -
- 10 -
Aspire Mining Limited
Aspire Mining Limited
Following shareholder approvals, performance rights have been issued to Non-Executive Directors or their
nominees.
Following the 2017 Annual General Meeting, 101,800,000 performance rights were issued to the Non-
Executive Directors to vest in six tranches on achievement of milestones based on share price performance
and development of the Group’s assets. The performance rights are valued at the share price at the grant date
of 1.2 cents per share.
On 13 July 2018, 16,966,667 ordinary shares were issued to Non-Executive Directors on exercise of
performance rights vested on achievement of a share price milestone. The remaining performance rights will
vest in five tranches if and when one or more of the remaining following five milestones are achieved:
annual fee were reviewed by the Board and following recommendations from the Remuneration Committee,
the fee payable to 2Rs Pty Ltd has been increased to $375,000, annually, from 1 January 2019.
Gan-Ochir Zunduisuren and Boldbaatar Bat-Amgalan have non-executive director engagement letters that set
out their duties and responsibilities and the causes for termination (breach of duty, incapacity and insolvency)
or resignation of their appointments. Executive Services Agreements will be negotiated, in respect to Gan-
Ochir Zunduisuren on the intended change in his role, and in respect to Boldbaatar Bat-Amgalan, on his re-
election required at the Company’s next Annual General Meeting.
The totals of remuneration paid to key management personnel of the company during the year are as follows
and detailed in Table 1:
1.
2.
3.
4.
5.
if 80% or more of the initial issue of 1.8 cent AKMOA listed options are exercised
on or before 11 December 2019.
If following a decision by the Company to mine the Nuurstei Project, or a Board
approved equivalent project, the Company achieves production of a combined
500,000 tonnes per annum of washed hard coking coal by 31 December 2019.
if the Company achieves net profit after tax of at least $10 million by no later than
31 December 2019.
if the 30-day VWAP of the Company’s Shares as traded on ASX is equal to or
greater than A$0.03 by 30 June 2020.
if the 30-day VWAP of the Company’s Shares as traded on ASX is equal to or
greater than A$0.04 by 30 June 2021.
2019
$
645,524
2,603
280,698
928,825
2018
$
221,400
-
435,388
656,788
Short-term employee benefits
Post-employment benefits
Share-based payments
with accounting standards.
detailed in Tables 2 to 5.
Options
Share based payments is the gross accounting value of performance rights brought to account in accordance
The shares, options and rights held by key management personnel in the year ended 30 June 2019 are
With an intended capital consolidation, the number of performance rights on issue will be consolidated.
Senior manager and executive Director Remuneration
Remuneration consists of fixed remuneration and performance rights (as determined from time to time).
Performance Rights
During the year ended 30 June 2019 there were no options granted, vested or lapsed as part of Key
Management Personnel remuneration, other than 12,000,000 options exercisable at 1.8 cents on or before 11
December 2019 issued to the Non-Executive Director, Alex Passmore, as part of his remuneration.
Fixed Remuneration
Fixed remuneration is reviewed periodically by the Remuneration Committee or the Board. The process
consists of a review of relevant comparative remuneration in the market and internally and where appropriate,
external advice on policies and practices. The Committee and the Board has access to external, independent
advice where necessary.
Fixed remuneration is paid in the form of cash payments. The fixed remuneration component of the Group and
the Company executive is detailed in Table 1. Since his appointment as an Executive Director in 2010, David
Paull has been the sole Executive Director on the Company’s Board. However, during the Period, Gan-Ochir
Zunduisuren became an Executive Director and Boldbaatar Bat-Amgalan has held an executive position from
his appointment on 7 December 2018.
Employment Contracts
The Company has a Consultancy Agreement with 2Rs Pty Ltd, a company associated with Mr David Paull
(Agreement) effective as from 1 July 2010. Under the Agreement, as varied, Mr Paull is engaged by the
Company to provide services to the Group in the capacity of Managing Director and Executive Chairman. The
Consultancy Agreement continues unless terminated in accordance with the relevant provisions of the Service
Agreement. The Services Agreement contains standard termination provisions under which the Group must
give a minimum three months’ notice of termination, or alternatively, payment in lieu of service.
The annual fee paid to 2Rs Pty Ltd commenced in 2010 at $500,000 per annum but had been intermittently
reduced to $216,000 per annum from 1 February 2015 until 31 December 2018. The fee reductions were not
performance based but taken voluntarily in line with market at the time. The Consultancy Agreement and
Following from shareholder approval given at the 2017 Annual General Meeting held on 26 November 2017,
55,000,000 performance rights were issued to the nominee of David Paull.
The performance rights were valued at the share price at the grant date of 1.2 cents per share.
The performance milestones attaching to the performance rights are strategic. One of the six tranches vested
and 9,166,667 ordinary shares were issued on exercise on 13 July 2018 as the 30 day VWAP of the Company’s
Shares as traded on ASX was equal to or greater than A$0.02.
The remaining performance rights will vest in five tranches if and when one or more of the remaining following
five milestones are achieved:
1.
if 80% or more of the initial issue of 1.8 cent AKMOA listed options are exercised on or
before 11 December 2019.
2.
If following a decision by the Company to mine the Nuurstei Project, or a Board approved
equivalent project, the Company achieves production of a combined 500,000 tonnes per
annum of washed hard coking coal by 31 December 2019.
- 10 -
Aspire Mining Limited
DIRECTORS’ REPORT (continued)
Remuneration Report (audited) (continued)
annual fee were reviewed by the Board and following recommendations from the Remuneration Committee,
the fee payable to 2Rs Pty Ltd has been increased to $375,000, annually, from 1 January 2019.
Gan-Ochir Zunduisuren and Boldbaatar Bat-Amgalan have non-executive director engagement letters that set
out their duties and responsibilities and the causes for termination (breach of duty, incapacity and insolvency)
or resignation of their appointments. Executive Services Agreements will be negotiated, in respect to Gan-
Ochir Zunduisuren on the intended change in his role, and in respect to Boldbaatar Bat-Amgalan, on his re-
election required at the Company’s next Annual General Meeting.
The totals of remuneration paid to key management personnel of the company during the year are as follows
and detailed in Table 1:
Short-term employee benefits
Post-employment benefits
Share-based payments
2019
$
645,524
2,603
280,698
928,825
2018
$
221,400
-
435,388
656,788
Share based payments is the gross accounting value of performance rights brought to account in accordance
with accounting standards.
The shares, options and rights held by key management personnel in the year ended 30 June 2019 are
detailed in Tables 2 to 5.
Options
During the year ended 30 June 2019 there were no options granted, vested or lapsed as part of Key
Management Personnel remuneration, other than 12,000,000 options exercisable at 1.8 cents on or before 11
December 2019 issued to the Non-Executive Director, Alex Passmore, as part of his remuneration.
Performance Rights
Following from shareholder approval given at the 2017 Annual General Meeting held on 26 November 2017,
55,000,000 performance rights were issued to the nominee of David Paull.
The performance rights were valued at the share price at the grant date of 1.2 cents per share.
The performance milestones attaching to the performance rights are strategic. One of the six tranches vested
and 9,166,667 ordinary shares were issued on exercise on 13 July 2018 as the 30 day VWAP of the Company’s
Shares as traded on ASX was equal to or greater than A$0.02.
The remaining performance rights will vest in five tranches if and when one or more of the remaining following
five milestones are achieved:
1.
2.
if 80% or more of the initial issue of 1.8 cent AKMOA listed options are exercised on or
before 11 December 2019.
If following a decision by the Company to mine the Nuurstei Project, or a Board approved
equivalent project, the Company achieves production of a combined 500,000 tonnes per
annum of washed hard coking coal by 31 December 2019.
- 11 -
- 12 -
Aspire Mining Limited
Aspire Mining Limited
DIRECTORS’ REPORT (continued)
Remuneration Report (audited) (continued)
3.
4.
5.
if the Company achieves net profit after tax of at least $10 million by no later than 31
December 2019.
if the 30-day VWAP of the Company’s Shares as traded on ASX is equal to or greater
than A$0.03 by 30 June 2020.
if the 30-day VWAP of the Company’s Shares as traded on ASX is equal to or greater
than A$0.04 by 30 June 2021.
Remuneration of Key Management Personnel
Table 1: Key management personnel remuneration
Year ended 30 June 2019
Short term
employee
benefits
Post-
employment
benefits
Salary &
Fees
$
295,500
177,990
102,637
27,397
-
42,000
-
Superannuation
$
-
-
-
2,603
-
-
-
Share
Based
Payments
- Options
$
-
-
-
-
-
72,000
-
Other
Performance
Rights
Total
$
$
73,204 368,704
48,714 226,704
- 102,637
57,898
28,882
87,898
28,882
- 114,000
-
-
645,524
2,603
72,000
208,698 928,825
Performance
Related
%
20
21
-
66
100
-
-
22
Mr David Paull1
Mr Gan-Ochir Zunduisuren
Mr Boldbaatar Bat-Amgalan
(appt 7 Dec 18)
Mr Neil Lithgow
Ms Hannah Badenach
Mr Alexander Passmore2
Mr Achit-Erdene Darambazar
(appt 7 Dec 18)
Total
Year ended 30 June 2018
Short term
employee
benefits
Salary &
Fees
$
216,000
-
-
-
5,400
221,400
Post-
employment
benefits
Superannuation
$
-
-
-
-
-
-
Other
Performance
Rights
$
152,719
120,787
101,627
60,255
-
435,388
Total
$
368,719
120,787
101,627
60,255
5,400
656,788
Performance
Related
%
41
100
100
100
-
66
Mr David Paull1
Mr Neil Lithgow
Ms Hannah Badenach
Mr Gan-Ochir Zunduisuren
Mr Alexander Passmore2
Total
1 Paid or issued to 2Rs Pty Ltd, a company associated with Mr David Paull.
2 Paid to Horizon Advisors Pty Ltd, a company associated with Mr Alexander Passmore.
DIRECTORS’ REPORT (continued)
Remuneration Report (audited) (continued)
Key Management Personnel Equity Holdings
Table 2 - Fully Paid Ordinary Shares
2019
Mr David Paull1
Mr Gan-Ochir Zunduisuren
Mr Boldbaatar Bat-Amgalan
Mr Neil Lithgow
Ms Hannah Badenach
Mr Alexander Passmore
Mr Achit-Erdene
Darambazar
Total
2018
Mr David Paull1
Mr David McSweeney
Mr Neil Lithgow
Ms Hannah Badenach
Balance at
beginning of
period
Purchased
/Debt for
equity
Balance on
appointment/
Balance at
(retirement)
end of period
On exercise
of options or
performance
rights
9,566,667
6,100,000
17,250,000
3,616,667
16,486,124
41,292,203
220,028,501
9,083,333
1,190,476
286,890,161
1,190,476
36,533,334
324,613,971
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
26,052,791
47,392,203
237,278,501
13,890,476
-
-
-
-
-
4,902,792
16,466,962
182,611,834
750,000
5,583,332
2,166,666
35,416,6672
8,333,333
6,000,000
2,500,000
2,000,000
1,000,000
(21,133,628)
16,486,124
220,028,501
9,083,333
41,292,203
Mr Gan-Ochir Zunduisuren
40,292,203
Mr Alexander Passmore
Total
245,023,791
51,499,998
11,500,000
(21,133,628)
286,890,161
1 In 2018 and 2019 David Paull was a Director of Red Island Resources Limited, a public unlisted company
which is the beneficial owner of 8,350,000 ordinary shares (2018: 8,350,000 ordinary shares). However, from
2 August 2019 he no longer has a notifiable interest.
2 Mr Neil Lithgow received 10,000,000 shares in repayment of a loan.
- 11 -
- 12 -
Aspire Mining Limited
Aspire Mining Limited
DIRECTORS’ REPORT (continued)
Remuneration Report (audited) (continued)
3.
if the Company achieves net profit after tax of at least $10 million by no later than 31
4.
if the 30-day VWAP of the Company’s Shares as traded on ASX is equal to or greater
December 2019.
than A$0.03 by 30 June 2020.
than A$0.04 by 30 June 2021.
5.
if the 30-day VWAP of the Company’s Shares as traded on ASX is equal to or greater
Remuneration of Key Management Personnel
Table 1: Key management personnel remuneration
Year ended 30 June 2019
Short term
employee
benefits
Post-
employment
benefits
Fees
Superannuation
- Options
Rights
Total
Related
Payments
Performance
Performance
Share
Based
$
-
-
-
-
-
-
72,000
$
-
-
-
-
-
-
2,603
Other
$
$
73,204 368,704
48,714 226,704
- 102,637
57,898
28,882
87,898
28,882
- 114,000
-
-
%
20
21
66
100
-
-
-
645,524
2,603
72,000
208,698 928,825
22
Salary &
$
295,500
177,990
102,637
27,397
42,000
-
-
Mr David Paull1
Mr Gan-Ochir Zunduisuren
Mr Boldbaatar Bat-Amgalan
(appt 7 Dec 18)
Mr Neil Lithgow
Ms Hannah Badenach
Mr Alexander Passmore2
Mr Achit-Erdene Darambazar
(appt 7 Dec 18)
Total
Year ended 30 June 2018
Short term
employee
benefits
Salary &
Post-
employment
benefits
Other
Performance
Fees
Superannuation
Rights
Total
Related
Performance
Mr David Paull1
Mr Neil Lithgow
Ms Hannah Badenach
Mr Gan-Ochir Zunduisuren
Mr Alexander Passmore2
Total
216,000
$
-
-
-
5,400
221,400
$
-
-
-
-
-
-
$
152,719
120,787
101,627
60,255
-
$
368,719
120,787
101,627
60,255
5,400
435,388
656,788
%
41
100
100
100
-
66
1 Paid or issued to 2Rs Pty Ltd, a company associated with Mr David Paull.
2 Paid to Horizon Advisors Pty Ltd, a company associated with Mr Alexander Passmore.
DIRECTORS’ REPORT (continued)
Remuneration Report (audited) (continued)
Key Management Personnel Equity Holdings
Table 2 - Fully Paid Ordinary Shares
Balance at
beginning of
period
Purchased
/Debt for
equity
16,486,124
41,292,203
-
220,028,501
9,083,333
-
-
-
-
-
1,190,476
-
On exercise
of options or
performance
rights
9,566,667
6,100,000
-
17,250,000
3,616,667
-
-
286,890,161
-
1,190,476
-
36,533,334
Balance on
appointment/
(retirement)
Balance at
end of period
-
-
-
-
-
-
-
-
26,052,791
47,392,203
-
237,278,501
13,890,476
-
-
324,613,971
4,902,792
16,466,962
182,611,834
750,000
40,292,203
-
245,023,791
5,583,332
2,166,666
35,416,6672
8,333,333
-
-
51,499,998
6,000,000
2,500,000
2,000,000
-
1,000,000
-
11,500,000
-
(21,133,628)
-
-
-
(21,133,628)
16,486,124
-
220,028,501
9,083,333
41,292,203
-
286,890,161
2019
Mr David Paull1
Mr Gan-Ochir Zunduisuren
Mr Boldbaatar Bat-Amgalan
Mr Neil Lithgow
Ms Hannah Badenach
Mr Alexander Passmore
Mr Achit-Erdene
Darambazar
Total
2018
Mr David Paull1
Mr David McSweeney
Mr Neil Lithgow
Ms Hannah Badenach
Mr Gan-Ochir Zunduisuren
Mr Alexander Passmore
Total
1 In 2018 and 2019 David Paull was a Director of Red Island Resources Limited, a public unlisted company
which is the beneficial owner of 8,350,000 ordinary shares (2018: 8,350,000 ordinary shares). However, from
2 August 2019 he no longer has a notifiable interest.
2 Mr Neil Lithgow received 10,000,000 shares in repayment of a loan.
- 13 -
- 14 -
Aspire Mining Limited
Aspire Mining Limited
DIRECTORS’ REPORT (continued)
Remuneration Report (audited) (continued)
DIRECTORS’ REPORT (continued)
Remuneration Report (audited) (continued)
Key Management Personnel Equity Holdings
Table 3 - Performance rights exercisable at no consideration on achievement of tenure or other
performance milestones
Table 5 – Options exercisable at 2.5 cents on or before 14 or 24 August 2018
Balance at
beginning of
period
55,000,000
36,600,000
-
43,500,000
21,700,000
-
-
156,800,000
Balance
at
beginning
of period
1,145,833
-
-
6,354,167
2,083,334
-
-
9,583,334
Granted
Exercised
Expired
Balance on
appointment/
(retirement)
Balance at
end of
period
2019
Mr David Paull
Mr Gan-Ochir Zunduisuren
Mr Boldbaatar
Bat-Amgalan
Mr Neil Lithgow
Ms Hannah Badenach
Mr Alexander Passmore
Mr Achit-Erdene
Darambazar
Total
2018
Mr David Paull
Mr David McSweeney
Mr Neil Lithgow
Ms Hannah Badenach
Mr Gan-Ochir Zunduisuren
Mr Alexander Passmore
Total
-
-
-
-
-
-
-
-
(9,166,667)
(6,100,000)
-
(7,250,000)
(3,616,667)
-
-
(26,133,334)
-
-
-
-
-
-
-
-
8,000,000
2,500,000
2,000,000
-
1,000,000
-
55,000,000
-
43,500,000
21,700,000
36,600,000
-
13,500,000 156,800,000
(6,000,000)
(2,500,000)
(2,000,000)
-
(1,000,000)
-
(11,500,000)
(2,000,000)
-
-
-
-
-
(2,000,000)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
45,833,333
30,500,000
-
36,250,000
18,083,333
-
-
130,666,666
55,000,000
-
43,500,000
21,700,000
36,600,000
-
156,800,000
2019
Mr David Paull
Mr Gan-Ochir Zunduisuren
Mr Boldbaatar Bat-Amgalan
Mr Neil Lithgow
Ms Hannah Badenach
Mr Alex Passmore
Mr Achit-Erdene Darambazar
Total
2018
Mr David Paull
Mr Neil Lithgow
Ms Hannah Badenach
Mr Gan-Ochir Zunduisuren
Mr Alex Passmore
Total
-
-
-
-
-
-
-
-
-
-
-
-
-
12,000,000
-
12,000,000
-
-
-
-
-
-
1,145,833
6,354,167
2,083,334
-
-
9,583,334
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,145,833
-
-
6,354,167
2,083,334
12,000,000
-
21,583,334
1,145,833
6,354,167
2,083,334
-
-
9,583,334
Table 4 – Options exercisable at 1.8 cents on or before 11 December 2019
11,000,000
11,000,000
Participation
in placement
Issued as
remuneration Exercised
Expired
Balance at
end of period
Related Party Transactions
There were no related party transactions during the Period.
Mr Neil Lithgow
10,000,000
(10,000,000)
2019
Mr David Paull
Mr Gan-Ochir
Zunduisuren
Mr Boldbaatar
Bat-Amgalan
Ms Hannah Badenach
Mr Alex Passmore
Mr Achit-Erdene
Darambazar
Total
2018
Mr David Paull
Mr Neil Lithgow
Ms Hannah Badenach
Mr Gan-Ochir
Zunduisuren
Mr Alex Passmore
Total
Balance at
beginning of
Participation in
period
placement Exercised
Expired
(resignation)
Balance on
Balance at
Appointment/
end of
period
1,000,000
-
(400,000)
(600,000)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
11,000,000
(400,000)
(10,600,000)
1,000,000
10,000,000
1,000,000
10,000,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
As at 30 June 2019, there were unpaid Directors’ fees payable of $111,486 (2018: $21,400).
End of Remuneration Report
- 13 -
- 14 -
Aspire Mining Limited
Aspire Mining Limited
DIRECTORS’ REPORT (continued)
Remuneration Report (audited) (continued)
Table 5 – Options exercisable at 2.5 cents on or before 14 or 24 August 2018
Balance at
beginning of
period
Participation in
placement Exercised
Expired
Balance on
Appointment/
(resignation)
Balance at
end of
period
2019
Mr David Paull
Mr Gan-Ochir
Zunduisuren
Mr Boldbaatar
Bat-Amgalan
Mr Neil Lithgow
Ms Hannah Badenach
Mr Alex Passmore
Mr Achit-Erdene
Darambazar
Total
2018
Mr David Paull
Mr Neil Lithgow
Ms Hannah Badenach
Mr Gan-Ochir
Zunduisuren
Mr Alex Passmore
Total
1,000,000
-
(400,000)
(600,000)
-
-
10,000,000
-
-
-
11,000,000
-
-
-
-
-
-
-
-
-
-
-
-
(10,000,000)
-
-
-
-
-
(400,000)
-
(10,600,000)
-
-
-
-
-
-
1,000,000
10,000,000
-
-
-
11,000,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,000,000
10,000,000
-
-
-
11,000,000
beginning
Participation
Issued as
Balance at
of period
in placement
remuneration Exercised
Expired
end of period
Related Party Transactions
There were no related party transactions during the Period.
As at 30 June 2019, there were unpaid Directors’ fees payable of $111,486 (2018: $21,400).
End of Remuneration Report
DIRECTORS’ REPORT (continued)
Remuneration Report (audited) (continued)
Key Management Personnel Equity Holdings
Table 3 - Performance rights exercisable at no consideration on achievement of tenure or other
performance milestones
period
Granted
Exercised
Expired
Balance on
appointment/
(retirement)
Balance at
end of
period
Mr Gan-Ochir Zunduisuren
2019
Mr David Paull
Mr Boldbaatar
Bat-Amgalan
Mr Neil Lithgow
Ms Hannah Badenach
Mr Alexander Passmore
Mr Achit-Erdene
Darambazar
Total
2018
Mr David Paull
Mr David McSweeney
Mr Neil Lithgow
Ms Hannah Badenach
Mr Alexander Passmore
156,800,000
(26,133,334)
130,666,666
55,000,000
(6,000,000)
(2,000,000)
8,000,000
2,500,000
2,000,000
-
(2,500,000)
43,500,000
(2,000,000)
21,700,000
Mr Gan-Ochir Zunduisuren
1,000,000
36,600,000
(1,000,000)
Total
13,500,000 156,800,000
(11,500,000)
(2,000,000)
156,800,000
Table 4 – Options exercisable at 1.8 cents on or before 11 December 2019
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(9,166,667)
(6,100,000)
(7,250,000)
(3,616,667)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
45,833,333
30,500,000
36,250,000
18,083,333
55,000,000
43,500,000
21,700,000
36,600,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,145,833
6,354,167
2,083,334
12,000,000
21,583,334
1,145,833
6,354,167
2,083,334
9,583,334
-
-
-
-
-
2019
Mr David Paull
Mr Gan-Ochir Zunduisuren
Mr Boldbaatar Bat-Amgalan
Mr Neil Lithgow
Ms Hannah Badenach
Mr Alex Passmore
Mr Achit-Erdene Darambazar
Total
2018
Mr David Paull
Mr Neil Lithgow
Ms Hannah Badenach
Mr Gan-Ochir Zunduisuren
Mr Alex Passmore
Total
12,000,000
9,583,334
12,000,000
1,145,833
6,354,167
2,083,334
9,583,334
Balance at
beginning of
55,000,000
36,600,000
43,500,000
21,700,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Balance
at
1,145,833
6,354,167
2,083,334
- 15 -
Aspire Mining Limited
DIRECTORS’ REPORT (continued)
Directors’ Meetings
The number of meetings of Directors held during the year and those attended by each Director were as
follows:
Table 7 – Attendance at Director Meetings
Director
Mr David Paull
Mr Gan-Ochir Zunduisuren
Mr Boldbaatar Bat-Amgalan
Mr Neil Lithgow
Ms Hannah Badenach
Mr Alexander Passmore
Achit-Erdene Darambazar
Director Meetings
Attended
Eligible to Attend
9
9
3
9
7
8
3
9
9
3
9
9
9
3
Proceedings on behalf of the Company
No person has applied to the court under Section 237 of the Corporations Act 2001 for leave to bring
proceedings on behalf of the Company, or to intervene in any proceedings to which the Company is a party,
for the purpose of taking responsibility on behalf of the Company for all or part of those proceedings. No
proceedings have been brought or intervened in on behalf of the Company with leave of the court under
Section 237.
Auditor Independence and Non-Audit Services
Section 307C of the Corporations Act 2001 requires the Company’s auditors, HLB Mann Judd, to provide the
Directors of the Company with an Independence Declaration in relation to the audit of the financial report. This
Independence Declaration is set out on page 16 and forms part of this Directors’ report for the year ended 30
June 2019.
Non-Audit Services
Details of amounts paid or payable to the auditor for non-audit services provided during the year by the auditor
are outlined in Note 23 to the financial statements. The Directors are satisfied that the provision of non-audit
services is compatible with the general standard of independence for auditors imposed by the Corporations
Act 2001.
The Directors are of the opinion that the services do not compromise the auditor’s independence as all non-
audit services have been reviewed to ensure that they do not impact the impartiality and objectivity of the
auditor and none of the services undermine the general principles relating to auditor independence as set out
in Code of Conduct APES 110 Code of Ethics for Professional Accountants issued by the Accounting
Professional & Ethical Standards Board.
Signed in accordance with a resolution of the Directors.
David Paull
Executive Chairman
Dated this 26 September 2019
- 15 -
Aspire Mining Limited
- 16 -
Director Meetings
Attended
Eligible to Attend
AUDITOR’S INDEPENDENCE DECLARATION
As lead auditor for the audit of the consolidated financial report of Aspire Mining Limited for the
year ended 30 June 2019, I declare that to the best of my knowledge and belief, there have been
no contraventions of:
a)
the auditor independence requirements of the Corporations Act 2001 in relation to the
audit; and
b)
any applicable code of professional conduct in relation to the audit.
Perth, Western Australia
26 September 2019
N G Neill
Partner
The number of meetings of Directors held during the year and those attended by each Director were as
DIRECTORS’ REPORT (continued)
Directors’ Meetings
follows:
Table 7 – Attendance at Director Meetings
Director
Mr David Paull
Mr Gan-Ochir Zunduisuren
Mr Boldbaatar Bat-Amgalan
Mr Neil Lithgow
Ms Hannah Badenach
Mr Alexander Passmore
Achit-Erdene Darambazar
9
9
3
9
7
8
3
9
9
3
9
9
9
3
Proceedings on behalf of the Company
No person has applied to the court under Section 237 of the Corporations Act 2001 for leave to bring
proceedings on behalf of the Company, or to intervene in any proceedings to which the Company is a party,
for the purpose of taking responsibility on behalf of the Company for all or part of those proceedings. No
proceedings have been brought or intervened in on behalf of the Company with leave of the court under
Section 237.
Auditor Independence and Non-Audit Services
Section 307C of the Corporations Act 2001 requires the Company’s auditors, HLB Mann Judd, to provide the
Directors of the Company with an Independence Declaration in relation to the audit of the financial report. This
Independence Declaration is set out on page 16 and forms part of this Directors’ report for the year ended 30
June 2019.
Non-Audit Services
Act 2001.
Details of amounts paid or payable to the auditor for non-audit services provided during the year by the auditor
are outlined in Note 23 to the financial statements. The Directors are satisfied that the provision of non-audit
services is compatible with the general standard of independence for auditors imposed by the Corporations
The Directors are of the opinion that the services do not compromise the auditor’s independence as all non-
audit services have been reviewed to ensure that they do not impact the impartiality and objectivity of the
auditor and none of the services undermine the general principles relating to auditor independence as set out
in Code of Conduct APES 110 Code of Ethics for Professional Accountants issued by the Accounting
Professional & Ethical Standards Board.
Signed in accordance with a resolution of the Directors.
David Paull
Executive Chairman
Dated this 26 September 2019
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE
INCOME FOR THE YEAR ENDED 30 JUNE 2019
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2019
- 17 -
- 18 -
Aspire Mining Limited
Aspire Mining Limited
Deferred exploration and evaluation expenditure
37,461,876
35,609,772
Total Assets
49,691,983
44,754,004
Other income
Employee benefits expense
Note
2(a)
2019
$
325,741
(1,343,522)
2018
$
216,309
(752,719)
Exploration and evaluation expenditure impaired
10
(7,924)
(2,627,205)
Contract mining
Foreign exchange gain/(loss)
Interest expense
Borrowing costs
Share based payments
Other expenses
Loss before income tax expense
Income tax (expense)/benefit
Net loss for the year
Other comprehensive income
(1,053,330)
225,738
(164,841)
-
(344,088)
2(b)
(3,818,472)
(6,180,698)
3
(19,609)
(6,200,307)
(735,719)
(37,139)
(581,916)
(3,487)
(767,554)
(1,675,758)
(6,965,188)
(15,084)
(6,980,272)
Items that may be reclassified to profit or loss
Exchange differences on translation of foreign
operations
Other comprehensive (loss)/income for the year net
of tax
(977,576)
(977,576)
35,894
35,894
Total comprehensive loss
(7,177,883)
(6,944,378)
Loss attributable to:
Owners of the parent
Non-controlling interests
Total comprehensive (loss)/income attributable to:
Owners of the parent
Non-controlling interests
15
(6,042,258)
(158,049)
(6,200,307)
(6,933,549)
15
(244,334)
(7,177,883)
(6,643,531)
(336,741)
(6,980,272)
(6,572,419)
(371,959)
(6,944,378)
Basic loss per share (cents per share)
4
(0.20)
(0.35)
Current Assets
Cash and cash equivalents
Trade and other receivables
Total Current Assets
Non-Current Assets
Property plant and equipment
Intangible assets
Total Non-Current Assets
Current Liabilities
Trade and other payables
Financial liabilities
Total Current Liabilities
Non-Current Liabilities
Financial liabilities
Total Non-Current Liabilities
Total Liabilities
Net Assets
Equity
Issued capital
Reserves
Accumulated losses
Non-controlling interests
Total Equity
The accompanying notes form part of these financial statements.
The accompanying notes form part of these financial statements.
Note
8
9
10
12
13
11
14
14
2019
$
2018
$
11,136,142
7,488,401
504,291
1,386,423
11,640,433
8,874,824
477,056
112,618
269,408
-
38,051,550
35,879,180
309,632
12,068
321,700
760,525
-
760,525
73,411
73,411
3,246,630
3,246,630
395,111
4,007,155
49,296,872
40,746,849
6
7
7
114,897,715
99,087,130
(5,191,712)
(4,217,742)
(59,963,072)
(53,920,814)
15
(446,059)
(201,725)
49,296,872
40,746,849
Equity attributable to owners of the parent
49,742,931
40,948,574
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE
INCOME FOR THE YEAR ENDED 30 JUNE 2019
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2019
- 17 -
- 18 -
Aspire Mining Limited
Aspire Mining Limited
Exploration and evaluation expenditure impaired
10
(7,924)
(2,627,205)
Other income
Employee benefits expense
Contract mining
Foreign exchange gain/(loss)
Interest expense
Borrowing costs
Share based payments
Other expenses
Loss before income tax expense
Income tax (expense)/benefit
Net loss for the year
Other comprehensive income
Note
2(a)
2019
$
325,741
(1,343,522)
(1,053,330)
225,738
(164,841)
-
(344,088)
2(b)
(3,818,472)
(6,180,698)
3
(19,609)
(6,200,307)
2018
$
216,309
(752,719)
(735,719)
(37,139)
(581,916)
(3,487)
(767,554)
(1,675,758)
(6,965,188)
(15,084)
(6,980,272)
Items that may be reclassified to profit or loss
Exchange differences on translation of foreign
operations
of tax
Other comprehensive (loss)/income for the year net
(977,576)
(977,576)
35,894
35,894
Total comprehensive loss
(7,177,883)
(6,944,378)
Loss attributable to:
Owners of the parent
Non-controlling interests
Total comprehensive (loss)/income attributable to:
Owners of the parent
Non-controlling interests
15
(6,042,258)
(158,049)
(6,200,307)
(6,933,549)
15
(244,334)
(7,177,883)
(6,643,531)
(336,741)
(6,980,272)
(6,572,419)
(371,959)
(6,944,378)
Basic loss per share (cents per share)
4
(0.20)
(0.35)
Current Assets
Cash and cash equivalents
Trade and other receivables
Total Current Assets
Non-Current Assets
Deferred exploration and evaluation expenditure
Property plant and equipment
Intangible assets
Total Non-Current Assets
Total Assets
Current Liabilities
Trade and other payables
Financial liabilities
Total Current Liabilities
Non-Current Liabilities
Financial liabilities
Total Non-Current Liabilities
Total Liabilities
Net Assets
Equity
Issued capital
Reserves
Accumulated losses
Note
8
9
10
12
13
11
14
14
2019
$
2018
$
11,136,142
7,488,401
504,291
1,386,423
11,640,433
8,874,824
37,461,876
35,609,772
477,056
112,618
269,408
-
38,051,550
35,879,180
49,691,983
44,754,004
309,632
12,068
321,700
760,525
-
760,525
73,411
73,411
3,246,630
3,246,630
395,111
4,007,155
49,296,872
40,746,849
6
7
7
114,897,715
99,087,130
(5,191,712)
(4,217,742)
(59,963,072)
(53,920,814)
Equity attributable to owners of the parent
49,742,931
40,948,574
Non-controlling interests
Total Equity
15
(446,059)
(201,725)
49,296,872
40,746,849
The accompanying notes form part of these financial statements.
The accompanying notes form part of these financial statements.
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T
- 20 -
Aspire Mining Limited
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2019
Cash flows from operating activities
Interest received
Payments to suppliers and employees
Income tax paid
Interest and borrowing costs paid
Note
2019
$
2018
$
302,288
215,061
(6,178,022)
(3,342,754)
(19,609)
(186,253)
(15,084)
(587,494)
Net cash used in operating activities
8
(6,081,596)
(3,730,271)
-
-
-
-
-
-
-
-
-
-
Cash flows from investing activities
Payments for exploration and evaluation expenditure
(1,900,672)
(1,179,354)
Purchase of non-current assets
(391,772)
(101,239)
Payments for the purchase of subsidiary net of cash
acquired
Receipts from sale of non-current assets
Net cash used in investing activities
-
(3,888)
27,171
-
(2,265,273)
(1,284,481)
Cash flows from financing activities
Proceeds from issue of securities
Payments for capital raising costs
Proceeds from borrowings
Repayment of borrowings
12,679,330
13,006,838
(684,218)
-
14
(13,316)
(282,885)
305,000
(934,826)
Net cash provided by financing activities
11,981,796
12,094,127
Net increase in cash and cash equivalents
Cash and cash equivalents at the beginning of the year
Effect of foreign exchange rate fluctuations on cash held
3,634,927
7,488,401
12,814
7,079,375
412,089
(3,063)
Cash and cash equivalents at the end of the year
8
11,136,142
7,488,401
The accompanying notes from part of these financial statements.
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- 21 -
- 22 -
Aspire Mining Limited
Aspire Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES
(a)
(b)
(c)
Basis of Preparation
The financial report is a general purpose financial report, which has been prepared in accordance with
the requirements of the Corporations Act 2001, Australian Accounting Standards and Interpretations
and complies with other requirements of the law.
The financial report has also been prepared on a historical cost basis. Cost is based on the fair values
of the consideration given in exchange for assets.
The financial report is presented in Australian dollars.
The Company is a listed public Company, incorporated in Australia and operating in Mongolia. The
principal activity of the Group during the year was the progression for the approvals, completion of
studies, and funding towards the development of the Ovoot Early Development Project (OEDP).
Going concern
The 30 June 2019 financial report has been prepared on the going concern basis that contemplates the
continuity of normal business activities and the realisation of assets and discharge of its liabilities as
and when they fall due, in the ordinary course of business.
Adoption of new and revised standards
Changes in accounting policies on initial application of Accounting Standards
In the year ended 30 June 2019, the Directors have reviewed all of the new and revised Standards and
Interpretations issued by the AASB that are relevant to the Group and effective for the current annual
reporting period.
AASB 9 Financial Instrument
AASB 9 replaces AASB 139 Financial Instruments: Recognition and Measurement and makes changes
to a number of areas including classification of financial instruments, measurements, impairment of
financial assets and hedge accounting model.
The Group has adopted AASB 9 from 1 July 2018.
The standard introduced new classification and measurement models for financial assets. A financial
asset shall be measured at amortised cost if it is held within a business model whose objective is to hold
assets in order to collect contractual cash flows which arise on specified dates and that are solely
principal and interest.
A debt investment shall be measured at fair value through other comprehensive income if it is held within
a business model whose objective is to both hold assets in order to collect contractual cash flows which
arise on specified dates that are solely principal and interest as well as selling the asset on the basis of
its fair value.
All other financial assets are classified and measured at fair value through profit or loss unless the entity
makes an irrevocable election on initial recognition to present gains and losses on equity instruments
(that are not held-for-trading or contingent consideration recognised in a business combination) in other
comprehensive income ('OCI').
Despite these requirements, a financial asset may be irrevocably designated as measured at fair value
through profit or loss to reduce the effect of, or eliminate, an accounting mismatch.
For financial liabilities designated at fair value through profit or loss, the standard requires the portion of
the change in fair value that relates to the entity's own credit risk to be presented in OCI (unless it would
create an accounting mismatch).
New simpler hedge accounting requirements are intended to more closely align the accounting
treatment with the risk management activities of the entity.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(c)
Adoption of new and revised standards (continued)
New impairment requirements use an 'expected credit loss' ('ECL') model to recognise an allowance.
Impairment is measured using a 12-month ECL method unless the credit risk on a financial instrument
has increased significantly since initial recognition in which case the lifetime ECL method is adopted.
For receivables, a simplified approach to measuring expected credit losses using a lifetime expected
loss allowance is available.
The Group has applied AASB 9 retrospectively with the effect of initially applying this standard
recognised at the date of initial application, being 1 July 2018 and has elected not to restate comparative
information accordingly, the information presented for 30 June 2018 has not been restated.
There has been no material impact on the financial performance and position of the Group from the
adoption of this Accounting Standard.
AASB 15 Revenue from Contracts with Customers
AASB 15 replaces AASB 118 Revenue and AASB 111 Construction Contracts and related
interpretations and it applies to all revenue arising from contracts with customers, unless those contracts
are in the scope of other standards. The Group has adopted AASB 15 from 1 July 2018. There has been
no material impact on the financial performance and position of the Group from adoption of this
accounting standard.
Standards and interpretations in issue not yet adopted
Certain new accounting standards and interpretations have been published that are not mandatory for
30 June 2019 reporting periods. The standard which may have a significant to the Group are set out
below. The Group does not plan to adopt these standards early.
AASB 16 Leases
AASB 16 replaces the current AASB 17 Leases standard. AASB 16 removes the classification of leases
as either operating leases or finance leases- for the lessee - effectively treating all leases as finance
leases. Most leases will be capitalised on the statement of financial position by recognising a 'right-of-
use' asset and a lease liability for the present value obligation. This will result in an increase in the
recognised assets and liabilities in the statement of financial position as well as a change in expense
recognition, with interest and deprecation replacing operating lease expense.
Lessor accounting remains similar to current practice, i.e. lessors continue to classify leases as finance
and operating leases.
AASB 16 is effective from annual reporting periods beginning on or after 1 January 2019, with early
adoption permitted for entities that also adopt AASB 15.
The Group does not expect a significant effect on the financial statements resulting from the change of
this standard.
No other new standards, amendments to standards and interpretations are expected to affect the
Group's consolidated financial statements.
(d)
Statement of Compliance
The financial report was authorised for issue on 26 September 2019.
The financial report complies with Australian Accounting Standards, which include Australian
equivalents to International Financial Reporting Standards (AIFRS). Compliance with AIFRS ensures
that the financial report, comprising the financial statements and notes thereto, complies with
International Financial Reporting Standards (IFRS).
- 21 -
- 22 -
Aspire Mining Limited
Aspire Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES
(a)
Basis of Preparation
The financial report is a general purpose financial report, which has been prepared in accordance with
the requirements of the Corporations Act 2001, Australian Accounting Standards and Interpretations
and complies with other requirements of the law.
The financial report has also been prepared on a historical cost basis. Cost is based on the fair values
of the consideration given in exchange for assets.
The financial report is presented in Australian dollars.
The Company is a listed public Company, incorporated in Australia and operating in Mongolia. The
principal activity of the Group during the year was the progression for the approvals, completion of
studies, and funding towards the development of the Ovoot Early Development Project (OEDP).
(b)
Going concern
The 30 June 2019 financial report has been prepared on the going concern basis that contemplates the
continuity of normal business activities and the realisation of assets and discharge of its liabilities as
and when they fall due, in the ordinary course of business.
(c)
Adoption of new and revised standards
Changes in accounting policies on initial application of Accounting Standards
In the year ended 30 June 2019, the Directors have reviewed all of the new and revised Standards and
Interpretations issued by the AASB that are relevant to the Group and effective for the current annual
reporting period.
AASB 9 Financial Instrument
AASB 9 replaces AASB 139 Financial Instruments: Recognition and Measurement and makes changes
to a number of areas including classification of financial instruments, measurements, impairment of
financial assets and hedge accounting model.
The Group has adopted AASB 9 from 1 July 2018.
The standard introduced new classification and measurement models for financial assets. A financial
asset shall be measured at amortised cost if it is held within a business model whose objective is to hold
assets in order to collect contractual cash flows which arise on specified dates and that are solely
principal and interest.
its fair value.
A debt investment shall be measured at fair value through other comprehensive income if it is held within
a business model whose objective is to both hold assets in order to collect contractual cash flows which
arise on specified dates that are solely principal and interest as well as selling the asset on the basis of
All other financial assets are classified and measured at fair value through profit or loss unless the entity
makes an irrevocable election on initial recognition to present gains and losses on equity instruments
(that are not held-for-trading or contingent consideration recognised in a business combination) in other
comprehensive income ('OCI').
Despite these requirements, a financial asset may be irrevocably designated as measured at fair value
through profit or loss to reduce the effect of, or eliminate, an accounting mismatch.
For financial liabilities designated at fair value through profit or loss, the standard requires the portion of
the change in fair value that relates to the entity's own credit risk to be presented in OCI (unless it would
create an accounting mismatch).
New simpler hedge accounting requirements are intended to more closely align the accounting
treatment with the risk management activities of the entity.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(c)
Adoption of new and revised standards (continued)
New impairment requirements use an 'expected credit loss' ('ECL') model to recognise an allowance.
Impairment is measured using a 12-month ECL method unless the credit risk on a financial instrument
has increased significantly since initial recognition in which case the lifetime ECL method is adopted.
For receivables, a simplified approach to measuring expected credit losses using a lifetime expected
loss allowance is available.
The Group has applied AASB 9 retrospectively with the effect of initially applying this standard
recognised at the date of initial application, being 1 July 2018 and has elected not to restate comparative
information accordingly, the information presented for 30 June 2018 has not been restated.
There has been no material impact on the financial performance and position of the Group from the
adoption of this Accounting Standard.
AASB 15 Revenue from Contracts with Customers
AASB 15 replaces AASB 118 Revenue and AASB 111 Construction Contracts and related
interpretations and it applies to all revenue arising from contracts with customers, unless those contracts
are in the scope of other standards. The Group has adopted AASB 15 from 1 July 2018. There has been
no material impact on the financial performance and position of the Group from adoption of this
accounting standard.
Standards and interpretations in issue not yet adopted
Certain new accounting standards and interpretations have been published that are not mandatory for
30 June 2019 reporting periods. The standard which may have a significant to the Group are set out
below. The Group does not plan to adopt these standards early.
AASB 16 Leases
AASB 16 replaces the current AASB 17 Leases standard. AASB 16 removes the classification of leases
as either operating leases or finance leases- for the lessee - effectively treating all leases as finance
leases. Most leases will be capitalised on the statement of financial position by recognising a 'right-of-
use' asset and a lease liability for the present value obligation. This will result in an increase in the
recognised assets and liabilities in the statement of financial position as well as a change in expense
recognition, with interest and deprecation replacing operating lease expense.
Lessor accounting remains similar to current practice, i.e. lessors continue to classify leases as finance
and operating leases.
AASB 16 is effective from annual reporting periods beginning on or after 1 January 2019, with early
adoption permitted for entities that also adopt AASB 15.
The Group does not expect a significant effect on the financial statements resulting from the change of
this standard.
No other new standards, amendments to standards and interpretations are expected to affect the
Group's consolidated financial statements.
(d)
Statement of Compliance
The financial report was authorised for issue on 26 September 2019.
The financial report complies with Australian Accounting Standards, which include Australian
equivalents to International Financial Reporting Standards (AIFRS). Compliance with AIFRS ensures
that the financial report, comprising the financial statements and notes thereto, complies with
International Financial Reporting Standards (IFRS).
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
- 23 -
- 24 -
Aspire Mining Limited
Aspire Mining Limited
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(e)
Basis of Consolidation
(f)
Critical accounting judgements and key sources of estimation uncertainty (continued)
The consolidated financial statements comprise the financial statements of Aspire Mining Limited
(“Company” or “Parent”) and its subsidiaries as at 30 June each year (the “Group”). Control is achieved
where the Company has the power to govern the financial and operating policies of an entity so as to
obtain benefits from its activities.
The financial statements of the subsidiaries are prepared for the same reporting period as the parent
company, using consistent accounting policies.
In preparing the consolidated financial statements, all intercompany balances and transactions, income
and expenses and profit and losses resulting from intra-group transactions have been eliminated in full.
Subsidiaries are fully consolidated from the date on which control is transferred to the Group and cease
to be consolidated from the date on which control is transferred out of the Group. Control exists where
the Company has the power to govern the financial and operating policies of an entity so as to obtain
benefits from its activities. The existence and effect of potential voting rights that are currently
exercisable or convertible are considered when assessing when the Group controls another entity.
Business combinations have been accounted for using the acquisition method of accounting (refer Note
1(o)).
Unrealised gains or transactions between the Group and its associates are eliminated to the extent of
the Group’s interests in the associates. Unrealised losses are also eliminated unless the transaction
provides evidence of an impairment of the asset transferred. Accounting policies of associates have
been changed where necessary to ensure consistency with the policies adopted by the Group.
When the Group ceases to have control, joint control or significant influence, any retained interest in the
entity is remeasured to its fair value with the change in carrying amount recognised in profit or loss. The
fair value is the initial carrying amount for the purposes of subsequently accounting for the retained
interest as an associate, joint controlled entity or financial asset. In addition, any amounts previously
recognised in other comprehensive income in respect of that entity are accounted for as if the Group
had directly disposed of the related assets or liabilities. This may mean that amounts previously
recognised in other comprehensive income are reclassified to profit or loss.
(f)
Critical accounting judgements and key sources of estimation uncertainty
The application of accounting policies requires the use of judgements, 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.
Share-based payment transactions:
The Group measures the cost of equity-settled transactions with employees by reference to the fair value
of the equity instruments at the date at which they are granted. The fair value is determined by using a
Black and Scholes model for unlisted options and the market traded price for listed options and
performance rights that are bought to account, having regard to the terms and conditions upon which
the instruments are granted.
Exploration and evaluation costs carried forward
The Group’s accounting policy for exploration and evaluation expenditure is set out at Note 1(x). The
application of this policy necessarily requires management to make certain estimates and assumptions
as to future events and circumstances, in particular, the assessment of the expectation that exploration
costs incurred can be recouped through the successful development of the area (unless activities in the
area have not yet reached a stage that permits reasonable assessment of the existence of economically
recoverable reserves). The estimates and assumptions may change as new information becomes
available. If, after having capitalised expenditure under the policy, it is concluded that the expenditure
incurred is unlikely to be recovered by future exploitation or sale, then the relevant capitalised amount
will be impaired or written off through the statement of profit or loss and other comprehensive income.
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 Aspire Mining Limited.
Revenue is recognised to the extent that control of the goods or service has passed and it is probable
that the economic benefits will flow to the Group and the revenue can be reliably measured. The
following specific recognition criteria must also be met before revenue is recognised:
Interest revenue is recognised on a time proportionate basis that takes into account the effective yield
(g)
Segment Reporting
(h)
Revenue Recognition
Interest income
on the financial asset.
(i)
Cash and cash equivalents
(j)
Trade and other receivables
Cash comprises cash at bank and in hand. Cash equivalents are short term, highly liquid investments
that are readily convertible to known amounts of cash and which are subject to an insignificant risk of
changes in value.
Trade receivables are measured on initial recognition at fair value. Trade receivables are generally due
for settlement within periods ranging from 15 days to 30 days. The Group measures the loss allowance
for trade and other receivables at an amount equal to lifetime expected credit loss. The expected credit
losses on trade and other receivables are estimated with reference to past default experience of the
debtor and an analysis of the debtor’s current financial position, adjusted for factors that are specific to
the debtor, general economic conditions of the industry in which the debtor operates and an assessment
of both the current and the forecast direction of conditions at the reporting date.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
- 23 -
- 24 -
Aspire Mining Limited
Aspire Mining Limited
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(e)
Basis of Consolidation
(f)
Critical accounting judgements and key sources of estimation uncertainty (continued)
The consolidated financial statements comprise the financial statements of Aspire Mining Limited
(“Company” or “Parent”) and its subsidiaries as at 30 June each year (the “Group”). Control is achieved
where the Company has the power to govern the financial and operating policies of an entity so as to
obtain benefits from its activities.
The financial statements of the subsidiaries are prepared for the same reporting period as the parent
company, using consistent accounting policies.
In preparing the consolidated financial statements, all intercompany balances and transactions, income
and expenses and profit and losses resulting from intra-group transactions have been eliminated in full.
Subsidiaries are fully consolidated from the date on which control is transferred to the Group and cease
to be consolidated from the date on which control is transferred out of the Group. Control exists where
the Company has the power to govern the financial and operating policies of an entity so as to obtain
benefits from its activities. The existence and effect of potential voting rights that are currently
exercisable or convertible are considered when assessing when the Group controls another entity.
Business combinations have been accounted for using the acquisition method of accounting (refer Note
1(o)).
Unrealised gains or transactions between the Group and its associates are eliminated to the extent of
the Group’s interests in the associates. Unrealised losses are also eliminated unless the transaction
provides evidence of an impairment of the asset transferred. Accounting policies of associates have
been changed where necessary to ensure consistency with the policies adopted by the Group.
When the Group ceases to have control, joint control or significant influence, any retained interest in the
entity is remeasured to its fair value with the change in carrying amount recognised in profit or loss. The
fair value is the initial carrying amount for the purposes of subsequently accounting for the retained
interest as an associate, joint controlled entity or financial asset. In addition, any amounts previously
recognised in other comprehensive income in respect of that entity are accounted for as if the Group
had directly disposed of the related assets or liabilities. This may mean that amounts previously
recognised in other comprehensive income are reclassified to profit or loss.
(f)
Critical accounting judgements and key sources of estimation uncertainty
The application of accounting policies requires the use of judgements, 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.
Share-based payment transactions:
The Group measures the cost of equity-settled transactions with employees by reference to the fair value
of the equity instruments at the date at which they are granted. The fair value is determined by using a
Black and Scholes model for unlisted options and the market traded price for listed options and
performance rights that are bought to account, having regard to the terms and conditions upon which
the instruments are granted.
Exploration and evaluation costs carried forward
The Group’s accounting policy for exploration and evaluation expenditure is set out at Note 1(x). The
application of this policy necessarily requires management to make certain estimates and assumptions
as to future events and circumstances, in particular, the assessment of the expectation that exploration
costs incurred can be recouped through the successful development of the area (unless activities in the
area have not yet reached a stage that permits reasonable assessment of the existence of economically
recoverable reserves). The estimates and assumptions may change as new information becomes
available. If, after having capitalised expenditure under the policy, it is concluded that the expenditure
incurred is unlikely to be recovered by future exploitation or sale, then the relevant capitalised amount
will be impaired or written off through the statement of profit or loss and other comprehensive income.
(g)
Segment Reporting
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 Aspire Mining Limited.
(h)
Revenue Recognition
Revenue is recognised to the extent that control of the goods or service has passed and it is probable
that the economic benefits will flow to the Group and the revenue can be reliably measured. The
following specific recognition criteria must also be met before revenue is recognised:
Interest income
Interest revenue is recognised on a time proportionate basis that takes into account the effective yield
on the financial asset.
(i)
Cash and cash equivalents
Cash comprises cash at bank and in hand. Cash equivalents are short term, highly liquid investments
that are readily convertible to known amounts of cash and which are subject to an insignificant risk of
changes in value.
(j)
Trade and other receivables
Trade receivables are measured on initial recognition at fair value. Trade receivables are generally due
for settlement within periods ranging from 15 days to 30 days. The Group measures the loss allowance
for trade and other receivables at an amount equal to lifetime expected credit loss. The expected credit
losses on trade and other receivables are estimated with reference to past default experience of the
debtor and an analysis of the debtor’s current financial position, adjusted for factors that are specific to
the debtor, general economic conditions of the industry in which the debtor operates and an assessment
of both the current and the forecast direction of conditions at the reporting date.
- 25 -
Aspire Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(j)
Trade and other receivables (continued)
The Group writes off a trade receivable when there is information indicating that the debtor is in severe
financial difficulty and there is no realistic prospect of recovery; for example, when the debtor has been
placed under liquidation or has entered into bankruptcy proceedings, or when the trade receivables are
over two years past due, whichever occurs earlier. The amount of the impairment loss is recognised in
the statement of comprehensive income within other expenses. When a trade receivable for which an
impairment allowance had been recognised becomes uncollectible in a subsequent period, it is written
off against the allowance account. Subsequent recoveries of amounts previously written off are credited
against other expenses in the statement of comprehensive income.
(k)
Derecognition of financial assets and financial liabilities
(i) Financial assets
A financial asset (or, where applicable, a part of a financial asset or part of a Group of similar financial
assets) is derecognised when:
•
•
•
the rights to receive cash flows from the asset have expired;
the Group retains the right to receive cash flows from the asset, but has assumed an obligation
to pay them in full without material delay to a third party under a ‘pass-through’ arrangement;
or
the Group has transferred its rights to receive cash flows from the asset and either:
(a)
(b)
has transferred substantially all the risks and rewards of the asset, or
has neither transferred nor retained substantially all the risks and rewards of the asset
but has transferred control of the asset.
When the Group has transferred its rights to receive cash flows from an asset and has neither
transferred nor retained substantially all the risks and rewards of the asset nor transferred control of the
asset, the asset is recognised to the extent of the Group’s continuing involvement in the asset.
Continuing involvement that takes the form of a guarantee over the transferred asset is measured at
the lower of the original carrying amount of the asset and the maximum amount of consideration
received that the Group could be required to repay.
When continuing involvement takes the form of a written and/or purchased option (including a cash-
settled option or similar provision) on the transferred asset, the extent of the Group’s continuing
involvement is the amount of the transferred asset that the Group may repurchase, except that in the
case of a written put option (including a cash-settled option or similar provision) on an asset measured
at fair value, the extent of the Group’s continuing involvement is limited to the lower of the fair value of
the transferred asset and the option exercise price.
(ii) Financial liabilities
A financial liability is derecognised when the obligation under the liability is discharged or cancelled or
expires. When an existing financial liability is replaced by another from the same lender on substantially
different terms, or the terms of an existing liability are substantially modified, such an exchange or
modification is treated as a derecognition of the original liability and the recognition of a new liability,
and the difference in the respective carrying amounts is recognised in profit or loss.
- 26 -
Aspire Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(l)
Foreign currency translation
The functional and presentation currency of Aspire Mining Limited is Australian dollars. Each entity in
the Group determines its own functional currency and items included in the financial statements of each
entity are measured using that functional currency.
Transactions in foreign currencies are initially recorded in the functional currency by applying the
exchange rates ruling at the date of the transaction. Monetary assets and liabilities denominated in
foreign currencies are retranslated at the rate of exchange ruling at the balance date.
All exchange differences in the consolidated financial report are taken to profit or loss with the exception
of differences on foreign currency borrowings that provide a hedge against a net investment in a foreign
entity. These are taken directly to equity until the disposal of the net investment, at which time they are
recognised in profit or loss.
Tax charges and credits attributable to exchange differences on those borrowings are also recognised
in equity.
Non-monetary items that are measured in terms of historical cost in a foreign currency are translated
using the exchange rate as at the date of the initial transaction.
Non-monetary items measured at fair value in a foreign currency are translated using the exchange
rates at the date when the fair value was determined.
The functional currency of the Mongolian incorporated subsidiaries, Khurgatai Khairkhan LLC, Northern
Railways LLC, Ovoot Coal Mining LLC, Chilchig Gol LLC, Ekhgoviin Chuluu LLC and Black Rock LLC
is Mongolian Tugriks (MNT), Ovoot Coking Coal Pte Ltd, Northern Railways Pte Ltd Northern Railways
Holdings LLC and Northern Mongolian Railways Limited is USD.
As at the balance date the assets and liabilities of the subsidiaries are translated into the presentation
currency of Aspire Mining Limited at the rate of exchange ruling at the balance date and its statement
of comprehensive income is translated at the average exchange rate for the year.
The exchange differences arising on the translation are taken directly to the foreign currency translation
reserve in equity.
On disposal of a foreign entity, the deferred cumulative amount recognised in equity relating to that
particular foreign operation is recognised in profit or loss.
(m)
Income tax
Current tax assets and liabilities for the current and prior periods are measured at the amount expected
to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the
amount are those that are enacted or substantively enacted by the balance date.
Deferred income tax is provided on all temporary differences at the balance date between the tax bases
of assets and liabilities and their carrying amounts for financial reporting purposes.
Deferred income tax liabilities are recognised for all taxable temporary differences except:
• when the deferred income tax liability arises from the initial recognition of goodwill or of an asset or
liability in a transaction that is not a business combination and that, at the time of the transaction,
affects neither the accounting profit nor taxable profit or loss; or
• when the taxable temporary difference is associated with investments in subsidiaries, associates or
interests in joint ventures, and the timing of the reversal of the temporary difference can be
controlled and it is probable that the temporary difference will not reverse in the foreseeable future.
Deferred income tax assets are recognised for all deductible temporary differences, carry-forward of
unused tax assets and unused tax losses, to the extent that it is probable that taxable profit will be
available against which the deductible temporary differences and the carry-forward of unused tax credits
and unused tax losses can be utilised, except when the deferred income tax asset relating to
- 27 -
- 28 -
Aspire Mining Limited
Aspire Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(m)
Income tax (continued)
(o) Business combinations (continued)
the deductible temporary difference arises from the initial recognition of an asset or liability in a
transaction that is not a business combination and, at the time of the transaction, affects neither the
accounting profit nor taxable profit or loss; or when the deductible temporary difference is associated
with investments in subsidiaries, associates or interests in joint ventures, in which case a deferred tax
asset is only recognised to the extent that it is probable that the temporary difference will reverse in the
foreseeable future and taxable profit will be available against which the temporary difference can be
utilised.
The carrying amount of deferred income tax assets is reviewed at each balance date and reduced to
the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of
the deferred income tax asset to be utilised.
Unrecognised deferred income tax assets are reassessed at each balance date and are recognised to
the extent that it has become probable that future taxable profit will allow the deferred tax asset to be
recovered.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to
the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have
been enacted or substantively enacted at the balance date. Income taxes relating to items recognised
directly in equity are recognised in equity and not in profit or loss. Deferred tax assets and deferred tax
liabilities are offset only if a legally enforceable right exists to set off current tax assets against current
tax liabilities and the deferred tax assets and liabilities relate to the same taxable entity and the same
taxation authority.
(n)
Other taxes
Revenues, expenses and assets are recognised net of the amount of GST except:
• when the GST incurred on a purchase of goods and services is not recoverable from the taxation
authority, in which case the GST is recognised as part of the cost of acquisition of the asset or as
part of the expense item as applicable; and
•
receivables and payables, which are stated with the amount of GST included.
The net amount of GST recoverable from, or payable to, the taxation authority is included as part of
receivables or payables in the Statement of Financial Position.
Cash flows are included in the Statement of Cash Flows on a gross basis and the GST component of
cash flows arising from investing and financing activities, which is recoverable from, or payable to, the
taxation authority, are classified as operating cash flows.
Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable
to, the taxation authority.
(o)
Business combinations
The acquisition method of accounting is used to account for all business combinations, including
business combinations involving entities or business under common control, regardless of whether
equity instruments or other assets are acquired. The consideration transferred for the acquisition of a
subsidiary comprises the fair value of the assets transferred, the liabilities incurred and the equity
interests issued by the Group. The consideration transferred also includes the fair value of any
contingent consideration arrangement and the fair value of any pre-existing equity interest in the
subsidiary. Acquisition-related costs are expenses as incurred.
Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination
are, with limited exceptions, measured initially at their fair values at the acquisition date. On an
acquisition-by-acquisition basis, the Group recognises any non-controlling interest in the acquiree either
at fair value or at the non-controlling interest’s proportionate share of the acquiree’s net identifiable
The excess of the consideration transferred, the amount of any non-controlling interest in the acquiree
and the acquisition-date fair value of any previous equity interest in the acquiree over the fair value of
the Group’s share of the net identifiable assets acquired is recorded as goodwill. If those amounts are
less than the fair value of the net identifiable assets of the subsidiary acquired and the measurement of
all amounts has been reviewed, the difference is recognised directly in profit or loss as a bargain
Where settlement of any part of cash consideration is deferred, the amounts payable in the future are
discounted to their present value as at the date of exchange. The discount rate used is the entity’s
incremental borrowing rate, being the rate at which a similar borrowing could be obtained from an
independent financier under comparable terms and conditions.
Contingent consideration is classified as either equity or a financial liability. Amounts classified as a
financial liability are subsequently remeasured to fair value with changes in fair value recognised in profit
assets.
purchase.
or loss.
(p)
Impairment of assets
The Group assesses at each reporting date whether there is an indication that an asset may be impaired.
If any such indication exists, or when annual impairment testing for an asset is required, the Group
makes an estimate of the asset’s recoverable amount. An asset’s recoverable amount is the higher of
its fair value less costs to sell and its value in use and is determined for an individual asset, unless the
asset does not generate cash inflows that are largely independent of those from other assets or groups
of assets and the asset's value in use cannot be estimated to be close to its fair value. In such cases the
asset is tested for impairment as part of the cash-generating unit to which it belongs. When the carrying
amount of an asset or cash-generating unit exceeds its recoverable amount, the asset or cash-
generating unit is considered impaired and is written down to its recoverable amount.
In assessing value in use, the estimated future cash flows are discounted to their present value using a
pre-tax discount rate that reflects current market assessments of the time value of money and the risks
specific to the asset. Impairment losses relating to continuing operations are recognised in those
expense categories consistent with the function of the impaired asset unless the asset is carried at
revalued amount (in which case the impairment loss is treated as a revaluation decrease).
An assessment is also made at each balance date as to whether there is any indication that previously
recognised impairment losses may no longer exist or may have decreased. If such indication exists, the
recoverable amount is estimated. A previously recognised impairment loss is reversed only if there has
been a change in the estimates used to determine the asset’s recoverable amount since the last
impairment loss was recognised. If that is the case the carrying amount of the asset is increased to its
recoverable amount. That increased amount cannot exceed the carrying amount that would have been
determined, net of depreciation, had no impairment loss been recognised for the asset in prior years.
Such reversal is recognised in profit or loss unless the asset is carried at revalued amount, in which case
the reversal is treated as a revaluation increase. After such a reversal the depreciation charge is adjusted
in future periods to allocate the asset’s revised carrying amount, less any residual value, on a systematic
basis over its remaining useful life.
- 27 -
- 28 -
Aspire Mining Limited
Aspire Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(m)
Income tax (continued)
(o) Business combinations (continued)
the deductible temporary difference arises from the initial recognition of an asset or liability in a
transaction that is not a business combination and, at the time of the transaction, affects neither the
accounting profit nor taxable profit or loss; or when the deductible temporary difference is associated
with investments in subsidiaries, associates or interests in joint ventures, in which case a deferred tax
asset is only recognised to the extent that it is probable that the temporary difference will reverse in the
foreseeable future and taxable profit will be available against which the temporary difference can be
utilised.
recovered.
The carrying amount of deferred income tax assets is reviewed at each balance date and reduced to
the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of
the deferred income tax asset to be utilised.
Unrecognised deferred income tax assets are reassessed at each balance date and are recognised to
the extent that it has become probable that future taxable profit will allow the deferred tax asset to be
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to
the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have
been enacted or substantively enacted at the balance date. Income taxes relating to items recognised
directly in equity are recognised in equity and not in profit or loss. Deferred tax assets and deferred tax
liabilities are offset only if a legally enforceable right exists to set off current tax assets against current
tax liabilities and the deferred tax assets and liabilities relate to the same taxable entity and the same
taxation authority.
(n)
Other taxes
Revenues, expenses and assets are recognised net of the amount of GST except:
• when the GST incurred on a purchase of goods and services is not recoverable from the taxation
authority, in which case the GST is recognised as part of the cost of acquisition of the asset or as
part of the expense item as applicable; and
•
receivables and payables, which are stated with the amount of GST included.
The net amount of GST recoverable from, or payable to, the taxation authority is included as part of
receivables or payables in the Statement of Financial Position.
Cash flows are included in the Statement of Cash Flows on a gross basis and the GST component of
cash flows arising from investing and financing activities, which is recoverable from, or payable to, the
taxation authority, are classified as operating cash flows.
Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable
to, the taxation authority.
(o)
Business combinations
The acquisition method of accounting is used to account for all business combinations, including
business combinations involving entities or business under common control, regardless of whether
equity instruments or other assets are acquired. The consideration transferred for the acquisition of a
subsidiary comprises the fair value of the assets transferred, the liabilities incurred and the equity
interests issued by the Group. The consideration transferred also includes the fair value of any
contingent consideration arrangement and the fair value of any pre-existing equity interest in the
subsidiary. Acquisition-related costs are expenses as incurred.
Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination
are, with limited exceptions, measured initially at their fair values at the acquisition date. On an
acquisition-by-acquisition basis, the Group recognises any non-controlling interest in the acquiree either
at fair value or at the non-controlling interest’s proportionate share of the acquiree’s net identifiable
assets.
The excess of the consideration transferred, the amount of any non-controlling interest in the acquiree
and the acquisition-date fair value of any previous equity interest in the acquiree over the fair value of
the Group’s share of the net identifiable assets acquired is recorded as goodwill. If those amounts are
less than the fair value of the net identifiable assets of the subsidiary acquired and the measurement of
all amounts has been reviewed, the difference is recognised directly in profit or loss as a bargain
purchase.
Where settlement of any part of cash consideration is deferred, the amounts payable in the future are
discounted to their present value as at the date of exchange. The discount rate used is the entity’s
incremental borrowing rate, being the rate at which a similar borrowing could be obtained from an
independent financier under comparable terms and conditions.
Contingent consideration is classified as either equity or a financial liability. Amounts classified as a
financial liability are subsequently remeasured to fair value with changes in fair value recognised in profit
or loss.
(p)
Impairment of assets
The Group assesses at each reporting date whether there is an indication that an asset may be impaired.
If any such indication exists, or when annual impairment testing for an asset is required, the Group
makes an estimate of the asset’s recoverable amount. An asset’s recoverable amount is the higher of
its fair value less costs to sell and its value in use and is determined for an individual asset, unless the
asset does not generate cash inflows that are largely independent of those from other assets or groups
of assets and the asset's value in use cannot be estimated to be close to its fair value. In such cases the
asset is tested for impairment as part of the cash-generating unit to which it belongs. When the carrying
amount of an asset or cash-generating unit exceeds its recoverable amount, the asset or cash-
generating unit is considered impaired and is written down to its recoverable amount.
In assessing value in use, the estimated future cash flows are discounted to their present value using a
pre-tax discount rate that reflects current market assessments of the time value of money and the risks
specific to the asset. Impairment losses relating to continuing operations are recognised in those
expense categories consistent with the function of the impaired asset unless the asset is carried at
revalued amount (in which case the impairment loss is treated as a revaluation decrease).
An assessment is also made at each balance date as to whether there is any indication that previously
recognised impairment losses may no longer exist or may have decreased. If such indication exists, the
recoverable amount is estimated. A previously recognised impairment loss is reversed only if there has
been a change in the estimates used to determine the asset’s recoverable amount since the last
impairment loss was recognised. If that is the case the carrying amount of the asset is increased to its
recoverable amount. That increased amount cannot exceed the carrying amount that would have been
determined, net of depreciation, had no impairment loss been recognised for the asset in prior years.
Such reversal is recognised in profit or loss unless the asset is carried at revalued amount, in which case
the reversal is treated as a revaluation increase. After such a reversal the depreciation charge is adjusted
in future periods to allocate the asset’s revised carrying amount, less any residual value, on a systematic
basis over its remaining useful life.
- 29 -
- 30 -
Aspire Mining Limited
Aspire Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(q)
Trade and other payables
(t)
Share-based payment transactions
Trade payables and other payables are carried at amortised costs and represent liabilities for goods
and services provided to the Group prior to the end of the financial year that are unpaid and arise when
the Company becomes obliged to make future payments in respect of the purchase of these goods
and services.
(r)
Property, plant and equipment
Plant and equipment is stated at cost less accumulated depreciation and any accumulated impairment
losses. Depreciation is calculated on a straight-line basis over the three (3) year estimated useful life of
the assets.
The assets' residual values, useful lives and amortisation methods are reviewed, and adjusted if
appropriate, at each financial year end.
(i) Impairment
The carrying values of plant and equipment are reviewed for impairment at each balance date, with
recoverable amount being estimated when events or changes in circumstances indicate that the carrying
value may be impaired.
The recoverable amount of plant and equipment is the higher of fair value less costs to sell and value
in use. In assessing value in use, the estimated future cash flows are discounted to their present value
using a pre-tax discount rate that reflects current market assessments of the time value of money and
the risks specific to the asset.
For an asset that does not generate largely independent cash inflows, recoverable amount is determined
for the cash-generating unit to which the asset belongs, unless the asset's value in use can be estimated
to be close to its fair value.
Impairment exists when the carrying value of an asset or cash-generating units exceeds its estimated
recoverable amount. The asset or cash-generating unit is then written down to its recoverable amount.
For plant and equipment, impairment losses are recognised in the income statement in the cost of sales
line item.
(ii) Derecognition and disposal
An item of property, plant and equipment is derecognised upon disposal or when no further future
economic benefits are expected from its use or disposal.
Any gain or loss arising on derecognition of the asset (calculated as the difference between the net
disposal proceeds and the carrying amount of the asset) is included in profit or loss in the year the asset
is derecognised.
(s)
Provisions
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.
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of
a past event, it is probable that an outflow of resources embodying economic benefits will be required
to settle the obligation and a reliable estimate can be made of the amount of the obligation.
When the Group expects some or all of a provision to be reimbursed, for example under an insurance
contract, the reimbursement is recognised as a separate asset but only when the reimbursement is
virtually certain.
The expense relating to any provision is presented in the statement of profit or loss and other
comprehensive Income net of any reimbursement. If the effect of the time value of money is material,
provisions are discounted using a current pre-tax rate that reflects the risks specific to the liability. When
discounting is used, the increase in the provision due to the passage of time is recognised as a borrowing
cost.
Basic earnings per share is calculated as net profit or loss attributable to members of the parent,
adjusted to exclude any costs of servicing equity (other than dividends) and preference share dividends,
divided by the weighted average number of ordinary shares, adjusted for any bonus element. Diluted
earnings per share is calculated as net profit or loss attributable to members of the parent, adjusted for:
costs of servicing equity (other than dividends) and preference share dividends; the after tax effect of
dividends and interest associated with dilutive potential ordinary shares that have been recognised as
expenses; and other non-discretionary changes in revenues or expenses during the period that would
The Group provides benefits to employees (including senior executives) of the Group in the form of
share-based payments, whereby employees render services in exchange for shares or rights over
shares (equity-settled transactions). The cost of these equity-settled transactions with employees is
measured by reference to the fair value of the equity instruments at the date at which they are granted.
In valuing equity-settled transactions, account is taken of any performance conditions, and conditions
linked to the price of the shares of Aspire Mining Limited (market conditions) if applicable.
The cumulative expense recognised for equity-settled transactions at each reporting date until vesting
date reflects (i) the extent to which the vesting period has expired, and (ii) the Group’s best estimate of
the number of equity instruments that will ultimately vest. No adjustment is made for the likelihood of
market performance conditions being met as the effect of these conditions is included in the
determination of fair value at grant date. The statement of profit or loss and other comprehensive Income
charge or credit for a period represents the movement in cumulative expense recognised as at the
beginning and end of that period.
only conditional upon a market condition.
No expense is recognised for awards that do not ultimately vest, except for awards where vesting is
If the terms of an equity-settled award are modified, as a minimum an expense is recognised as if the
terms had not been modified. In addition, an expense is recognised for any modification that increases
the total fair value of the share-based payment arrangement, or is otherwise beneficial to the employee,
as measured at the date of modification.
If an equity-settled award is cancelled, it is treated as if it had vested on the date of cancellation, and
any expense not yet recognised for the award is recognised immediately. However, if a new award is
substituted for the cancelled award and designated as a replacement award on the date that it is
granted, the cancelled and new award are treated as if they were a modification of the original award,
as described in the previous paragraph.
Cash settled transactions:
The Group measures the cost of equity-settled transactions with employees by reference to the fair value
of the equity instruments at the date at which they are granted. The fair value is determined by using a
Black and Scholes model for unlisted options and the market traded price for listed options and
performance rights that are bought to account, having regard to the terms and conditions upon which
the instruments are granted. This fair value is expensed over the period until vesting with recognition of
a corresponding liability. The liability is re-measured to fair value at each balance date up to and including
the settlement date with changes in fair value recognised in profit or loss.
(u)
Issued capital
(v)
Earnings per share
- 30 -
Aspire Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(t)
Share-based payment transactions
The Group provides benefits to employees (including senior executives) of the Group in the form of
share-based payments, whereby employees render services in exchange for shares or rights over
shares (equity-settled transactions). The cost of these equity-settled transactions with employees is
measured by reference to the fair value of the equity instruments at the date at which they are granted.
In valuing equity-settled transactions, account is taken of any performance conditions, and conditions
linked to the price of the shares of Aspire Mining Limited (market conditions) if applicable.
The cumulative expense recognised for equity-settled transactions at each reporting date until vesting
date reflects (i) the extent to which the vesting period has expired, and (ii) the Group’s best estimate of
the number of equity instruments that will ultimately vest. No adjustment is made for the likelihood of
market performance conditions being met as the effect of these conditions is included in the
determination of fair value at grant date. The statement of profit or loss and other comprehensive Income
charge or credit for a period represents the movement in cumulative expense recognised as at the
beginning and end of that period.
No expense is recognised for awards that do not ultimately vest, except for awards where vesting is
only conditional upon a market condition.
If the terms of an equity-settled award are modified, as a minimum an expense is recognised as if the
terms had not been modified. In addition, an expense is recognised for any modification that increases
the total fair value of the share-based payment arrangement, or is otherwise beneficial to the employee,
as measured at the date of modification.
If an equity-settled award is cancelled, it is treated as if it had vested on the date of cancellation, and
any expense not yet recognised for the award is recognised immediately. However, if a new award is
substituted for the cancelled award and designated as a replacement award on the date that it is
granted, the cancelled and new award are treated as if they were a modification of the original award,
as described in the previous paragraph.
Cash settled transactions:
The Group measures the cost of equity-settled transactions with employees by reference to the fair value
of the equity instruments at the date at which they are granted. The fair value is determined by using a
Black and Scholes model for unlisted options and the market traded price for listed options and
performance rights that are bought to account, having regard to the terms and conditions upon which
the instruments are granted. This fair value is expensed over the period until vesting with recognition of
a corresponding liability. The liability is re-measured to fair value at each balance date up to and including
the settlement date with changes in fair value recognised in profit or loss.
(u)
Issued capital
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new
shares or options are shown in equity as a deduction, net of tax, from the proceeds.
(v)
Earnings per share
Basic earnings per share is calculated as net profit or loss attributable to members of the parent,
adjusted to exclude any costs of servicing equity (other than dividends) and preference share dividends,
divided by the weighted average number of ordinary shares, adjusted for any bonus element. Diluted
earnings per share is calculated as net profit or loss attributable to members of the parent, adjusted for:
costs of servicing equity (other than dividends) and preference share dividends; the after tax effect of
dividends and interest associated with dilutive potential ordinary shares that have been recognised as
expenses; and other non-discretionary changes in revenues or expenses during the period that would
- 31 -
Aspire Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(u)
Earnings per share
result from the dilution of potential ordinary shares; divided by the weighted average number of ordinary
shares and dilutive potential ordinary shares, adjusted for any bonus element.
(v)
Exploration and evaluation
Exploration and evaluation expenditures in relation to each separate area of interest are recognised as
an exploration and evaluation asset in the year in which they are incurred where the following conditions
are satisfied:
i)
ii) at least one of the following conditions is also met:
the rights to tenure of the area of interest are current; and
(a) the exploration and evaluation expenditures are expected to be recouped through successful
development and exploration of the area of interest, or alternatively, by its sale; or
(b) exploration and evaluation 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 initially measured at cost and include acquisition of rights to
explore, studies, exploratory drilling, trenching and sampling and associated activities. General and
administrative costs are only included in the measurement of exploration and evaluation costs where
they are related directly to operational activities in a particular area of interest.
Exploration and evaluation assets are assessed for impairment when facts and circumstances suggest
that the carrying amount of an exploration and evaluation asset may exceed its recoverable amount.
The recoverable amount of the exploration and evaluation asset (for the cash generating unit(s) to which
it has been allocated being no larger than the relevant area of interest) is estimated to determine the
extent of the impairment loss (if any). Where an impairment loss subsequently reverses, the carrying
amount of the asset is increased to the revised estimate of its recoverable amount, but only to the extent
that the increased carrying amount does not exceed the carrying amount that would have been
determined had no impairment loss been recognised for the asset in previous years. Where a decision
has been made to proceed with development in respect of a particular area of interest, the relevant
exploration and evaluation asset is tested for impairment and the balance is then reclassified to
development.
(w)
Parent entity financial information
The financial information for the parent entity, Aspire Mining Limited, disclosed in Note 24 has been
prepared on the same basis as the consolidated financial statements, other than investments in
subsidiaries are accounted for at cost.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
- 32 -
Aspire Mining Limited
NOTE 2: REVENUES AND EXPENSES
(a) Revenue
Interest income
(b) Other Expenses
Accounting and audit fees
Amortisation and depreciation expense
Community relations
Company secretarial
Consultants
Corporate costs
Directors’ fees
Insurance
Legal fees
Office and administration costs
Share registry and listing expenses
Media, promotion and investor relations
Rent and outgoings
Travel expenses
Other
NOTE 3: INCOME TAX
Income tax recognised in profit or loss
The prima facie income tax expense on pre-tax accounting loss
from operations reconciles to the income tax expense in the
financial statements as follows:
Accounting loss before tax
Income tax benefit calculated at 30%
Accrued expenses
Other non-deductible expenses
Deductions available over more than one year
Exploration and tenement expenses
Income tax benefit not brought to account
Income tax (benefit)/expense
Made up of:
Income tax expense on Mongolian operations
Income tax (benefit)/expense
2019
$
325,741
325,741
160,780
160,590
340,125
154,321
258,604
557,040
633,677
131,560
364,490
67,202
75,572
252,333
131,939
307,360
222,879
3,818,472
2019
$
(6,180,698)
(1,854,209)
8,175
688,356
(108,876)
2,377
1,283,786
19,609
19,609
19,609
2018
$
216,309
216,309
128,877
32,015
-
143,860
151,912
142,567
230,781
65,636
82,577
62,788
68,677
143,753
71,718
184,780
165,817
1,675,758
2018
$
(6,965,188)
(2,089,556)
150
423,689
(94,878)
788,162
987,517
15,084
15,084
15,084
The tax rate used in the above reconciliation is the corporate tax rate of 30% payable by Australian corporate
entities on taxable profits under Australian tax law. There has been no change in this tax rate since the
previous reporting period.
The Group has an unrecorded deferred tax asset of $5,705,739 (2018: $5,616,754) in respect to tax losses
arising in Australia and $1,786,589 (2018: $4,170,439) in respect to tax losses arising in Mongolia, the tax
benefit of which has not been brought to account and are available subject to confirmation of the continuity of
ownership test or the same business test. The Group has an unrecorded deferred tax asset of $72,025 (2018:
$119,057) relating to share issue and other costs, and deferred tax liabilities of $1,858,080 (2018: $1,806,310)
relating to capitalised exploration and evaluation expenditure arising in Australia for which an offsetting
deferred tax asset has been recognised. The Group also has an unrecorded deferred tax asset of $345,745
(2018: $345,745) in respect to capital losses arising in Australia.
- 33 -
- 34 -
Aspire Mining Limited
Aspire Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTE 4: EARNINGS PER SHARE
Basic loss per share:
Continuing operations
The earnings and weighted average number of ordinary
shares used in the calculation of basic earnings per share is as
follows:
Earnings used in calculation of basic loss per share:
Loss attributable to owners of the parent
2019
Cents per share
2018
Cents per share
(0.20)
(0.35)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTE 5: SEGMENT INFORMATION
Continuing operations
Australia
$
Mongolia
$
122,047
203,694
Singapore
Year ended 30 June 2019
Total segment revenue
Segment net operating loss
after tax
(2,763,744)
(3,247,389)
(189,174)
(6,200,307)
Interest revenue
Depreciation and amortisation
122,047
-
203,694
(160,590)
(6,042,258)
(6,643,531)
Segment assets
9,262,900
40,423,217
5,866
49,691,983
Weighted average number of ordinary shares for the purpose of
basic loss per share
3,006,321,310
1,873,070,955
As losses have been incurred to date, no dilutive earnings per share has been disclosed.
Segment liabilities
(291,321)
(103,790)
Capital expenditure during the
year
-
(3,069,500)
Total
$
325,741
325,741
(160,590)
(395,111)
(3,069,560)
(2,265,273)
11,981,796
Total
$
216,309
$
-
-
-
-
-
-
-
$
-
-
-
(2,008,834)
(3,855,765)
(216,997)
(6,081,596)
-
(2,265,273)
11,995,112
(13,316)
Continuing operations
Australia
$
Mongolia
Singapore
$
64,913
151,396
Cash flow information
Net cash flow from operating
Net cash flow from investing
Net cash flow from financing
activities
activities
activities
Year ended 30 June 2018
Total segment revenue
Segment net operating loss
after tax
Capital expenditure during the
year
Cash flow information
Net cash flow from operating
activities
activities
activities
Net cash flow from investing
Net cash flow from financing
(1,889,369)
(4,517,424)
(573,479)
(6,980,272)
Interest revenue
Depreciation and amortisation
64,913
-
151,396
(32,015)
216,309
(32,015)
Segment assets
4,736,085
40,013,542
4,377
44,754,004
Segment liabilities
(144,608)
(490,575)
(3,371,972)
(4,007,155)
-
2,310,736
-
2,310,736
(1,174,240)
(1,981,018)
(575,013)
(3,730,271)
-
(1,284,481)
12,094,127
-
-
-
(1,284,481)
12,094,127
- 34 -
Aspire Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTE 5: SEGMENT INFORMATION
Year ended 30 June 2019
Total segment revenue
Segment net operating loss
after tax
Continuing operations
Mongolia
$
Australia
$
Singapore
$
Total
$
122,047
203,694
-
325,741
(2,763,744)
(3,247,389)
(189,174)
(6,200,307)
Interest revenue
Depreciation and amortisation
122,047
-
203,694
(160,590)
-
-
325,741
(160,590)
Segment assets
9,262,900
40,423,217
5,866
49,691,983
Segment liabilities
Capital expenditure during the
year
(291,321)
(103,790)
-
(3,069,500)
-
-
(395,111)
(3,069,560)
Cash flow information
Net cash flow from operating
activities
Net cash flow from investing
activities
Net cash flow from financing
activities
Year ended 30 June 2018
Total segment revenue
Segment net operating loss
after tax
(2,008,834)
(3,855,765)
(216,997)
(6,081,596)
-
(2,265,273)
11,995,112
(13,316)
-
-
(2,265,273)
11,981,796
Continuing operations
Mongolia
$
Australia
$
Singapore
$
Total
$
64,913
151,396
-
216,309
(1,889,369)
(4,517,424)
(573,479)
(6,980,272)
Interest revenue
Depreciation and amortisation
64,913
-
151,396
(32,015)
-
-
216,309
(32,015)
Segment assets
4,736,085
40,013,542
4,377
44,754,004
Segment liabilities
Capital expenditure during the
year
Cash flow information
Net cash flow from operating
activities
Net cash flow from investing
activities
Net cash flow from financing
activities
(144,608)
(490,575)
(3,371,972)
(4,007,155)
-
2,310,736
-
2,310,736
(1,174,240)
(1,981,018)
(575,013)
(3,730,271)
-
(1,284,481)
12,094,127
-
-
-
(1,284,481)
12,094,127
- 35 -
- 36 -
Aspire Mining Limited
Aspire Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTE 6: ISSUED CAPITAL
Ordinary shares
Issued and fully paid
Less share issue costs
Movements in ordinary shares on issue
At 1 July 2017
Shares issued at 3.3c on 3 July 2017 on exercise of performance rights
Shares issued at 2c on 14 August 2018 pursuant to a placement
Shares issued at 2c on 24 August 2018 pursuant to a placement
Shares issued at 2c on 24 August 2018 equity for debt
Shares issued at 2c on 1 September 2018 equity for debt
Shares issued at 3.3c on 4 October 2017 on exercise of performance rights
Shares issued at 1.9c on 7 November 2017 as part asset acquisition
consideration
Shares issued at 1.2c on 11 December 2017 pursuant to a 6 for 5 rights
issue
Shares issued at 1.2 c as repayment of loans on 11 December 2017
Shares issued at 1.8c on 9 February 2018 on exercise of options
Shares issued at 3.3c on 9 May 2018 on exercise of performance rights
Shares issued at 1.8c on 25 May 2018 on exercise of options
Shares issued at 1.8c on 25 June 2018 on exercise of options
Share issue costs
At 30 June 2018
At 1 July 2018
Shares issued at 1.25 cents on 17 July 2018 on exercise of vested
performance rights
Shares issued at 2.5 cents on 15 August 2018 on exercise of unlisted
options
Shares issued at 1.8 cents on 24 September 2018 on exercise of listed
options
Shares issued at 2.1 cents on 6 December 2018 pursuant to debt and
interest for equity agreement
Shares issued at 2.1 cents on 6 December 2018 pursuant to placement with
a substantial shareholder
Shares issued at 2.1 cents on 6 December 2018 to subscribers to the
additional placement
Shares issued at 1.8 cents on 19 March 2019 on exercise of listed options
Share issue costs
At 30 June 2019
2019
$
2018
$
121,714,824 105,085,021
(6,817,109)
(5,997,891)
114,897,715
99,087,130
No.
939,534,971
5,500,000
54,922,250
500,000
23,333,333
108,337,867
6,000,000
$
80,200,207
181,500
1,098,445
10,000
466,667
2,166,757
198,000
10,000,000
190,000
1,081,121,401
296,632,704
42,000
3,250,000
13,000
36,000
-
2,529,223,526
12,973,457
3,559,592
756
107,250
234
648
(2,066,383)
99,087,130
2,529,223,526
99,087,130
34,216,671
426,767
44,527,250
1,113,181
53,400
961
161,366,954
3,388,706
476,190,476
10,000,000
80,952,381
10,417
-
1,700,000
188
(819,218)
3,326,541,075 114,897,715
For accounting purposes, the price of the performance rights is the quoted share price at the date the issues
were approved. Nil consideration was paid for the performance rights.
Contribution Reserve
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTE 7: ACCUMULATED LOSSES AND RESERVES
Accumulated losses
Movements in accumulated losses are as follows:
Balance at beginning of financial year
Transfer on expiry of performance rights
Balance at end of financial year
Reserves
2019
$
2018
$
(53,920,814)
(47,460,080)
-
182,797
(59,963,072)
(53,920,814)
Net loss for the year attributable to owners of the parent
(6,042,258)
(6,643,531)
Contribution
Foreign currency
Share based
Total
Reserve
payments reserve
translation
reserve
(7,344,687)
463,647
(6,881,040)
71,112
$
-
$
71,112
767,554
767,554
688,877
688,877
(182,797)
(182,797)
(486,750)
(486,750)
1,805,302
-
1,805,302
1,805,302
(7,273,575)
1,250,531
(4,217,742)
At 30 June 2017
Currency translation differences
Issue of performance rights
Issue of listed options to underwriter
Performance rights expired unvested
Performance rights vested
Non-controlling interest arising on part
disposal
At 30 June 2018
Issue of performance rights
Performance rights vested
Performance rights cancelled
Issue of options as remuneration
$
-
-
-
-
-
-
-
-
-
-
-
$
-
-
-
-
-
-
-
-
-
At 30 June 2018
1,805,302
(7,273,575)
1,250,531
(4,217,742)
Currency translation differences
(891,291)
-
(891,291)
273,168
273,168
(426,767)
(426,767)
(1,080)
72,000
(1,080)
72,000
At 30 June 2019
1,805,302
(8,164,866)
1,167,852
(5,191,712)
The foreign currency translation reserve is used to record exchange differences arising from the translation of
Nature and purpose of reserves
Foreign currency translation reserve
the financial statements of foreign subsidiaries.
Share based payments reserve
The share based payments reserve is used to record the value of equity instruments issued to Directors,
employees and qualifying contractors as part of their remuneration.
The contribution reserve is used to record the value which arises as a result of transactions with non-controlling
interests that do not result in a loss of control.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTE 6: ISSUED CAPITAL
Ordinary shares
Issued and fully paid
Less share issue costs
2019
$
2018
$
121,714,824 105,085,021
(6,817,109)
(5,997,891)
114,897,715
99,087,130
No.
$
939,534,971
80,200,207
5,500,000
181,500
54,922,250
1,098,445
500,000
23,333,333
10,000
466,667
108,337,867
2,166,757
10,000,000
190,000
1,081,121,401
12,973,457
42,000
13,000
36,000
756
234
648
-
(2,066,383)
2,529,223,526
99,087,130
2,529,223,526
99,087,130
34,216,671
426,767
44,527,250
1,113,181
53,400
961
161,366,954
3,388,706
476,190,476
10,000,000
80,952,381
1,700,000
-
(819,218)
3,326,541,075 114,897,715
Movements in ordinary shares on issue
At 1 July 2017
Shares issued at 3.3c on 3 July 2017 on exercise of performance rights
Shares issued at 2c on 14 August 2018 pursuant to a placement
Shares issued at 2c on 24 August 2018 pursuant to a placement
Shares issued at 2c on 24 August 2018 equity for debt
Shares issued at 2c on 1 September 2018 equity for debt
Shares issued at 3.3c on 4 October 2017 on exercise of performance rights
6,000,000
198,000
Shares issued at 1.9c on 7 November 2017 as part asset acquisition
consideration
issue
Shares issued at 1.2c on 11 December 2017 pursuant to a 6 for 5 rights
Shares issued at 1.2 c as repayment of loans on 11 December 2017
296,632,704
3,559,592
Shares issued at 1.8c on 9 February 2018 on exercise of options
Shares issued at 3.3c on 9 May 2018 on exercise of performance rights
3,250,000
107,250
Shares issued at 1.8c on 25 May 2018 on exercise of options
Shares issued at 1.8c on 25 June 2018 on exercise of options
Share issue costs
At 30 June 2018
At 1 July 2018
performance rights
options
options
Shares issued at 1.25 cents on 17 July 2018 on exercise of vested
Shares issued at 2.5 cents on 15 August 2018 on exercise of unlisted
Shares issued at 1.8 cents on 24 September 2018 on exercise of listed
Shares issued at 2.1 cents on 6 December 2018 pursuant to debt and
Shares issued at 2.1 cents on 6 December 2018 pursuant to placement with
Shares issued at 2.1 cents on 6 December 2018 to subscribers to the
interest for equity agreement
a substantial shareholder
additional placement
Share issue costs
At 30 June 2019
Shares issued at 1.8 cents on 19 March 2019 on exercise of listed options
10,417
188
For accounting purposes, the price of the performance rights is the quoted share price at the date the issues
were approved. Nil consideration was paid for the performance rights.
- 35 -
- 36 -
Aspire Mining Limited
Aspire Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTE 7: ACCUMULATED LOSSES AND RESERVES
Accumulated losses
Movements in accumulated losses are as follows:
Balance at beginning of financial year
2019
$
2018
$
(53,920,814)
(47,460,080)
Net loss for the year attributable to owners of the parent
(6,042,258)
(6,643,531)
Transfer on expiry of performance rights
Balance at end of financial year
-
182,797
(59,963,072)
(53,920,814)
Reserves
At 30 June 2017
Currency translation differences
Issue of performance rights
Issue of listed options to underwriter
Performance rights expired unvested
Performance rights vested
Contribution
Reserve
Foreign currency
translation
reserve
Share based
payments reserve
Total
$
-
-
-
-
-
-
$
$
$
(7,344,687)
463,647
(6,881,040)
71,112
-
71,112
-
-
-
-
-
767,554
767,554
688,877
688,877
(182,797)
(182,797)
(486,750)
(486,750)
-
1,805,302
Non-controlling interest arising on part
disposal
1,805,302
At 30 June 2018
1,805,302
(7,273,575)
1,250,531
(4,217,742)
At 30 June 2018
1,805,302
(7,273,575)
1,250,531
(4,217,742)
Currency translation differences
Issue of performance rights
Performance rights vested
Performance rights cancelled
Issue of options as remuneration
-
-
-
-
-
(891,291)
-
(891,291)
-
-
-
-
273,168
273,168
(426,767)
(426,767)
(1,080)
72,000
(1,080)
72,000
At 30 June 2019
1,805,302
(8,164,866)
1,167,852
(5,191,712)
Nature and purpose of reserves
Foreign currency translation reserve
The foreign currency translation reserve is used to record exchange differences arising from the translation of
the financial statements of foreign subsidiaries.
Share based payments reserve
The share based payments reserve is used to record the value of equity instruments issued to Directors,
employees and qualifying contractors as part of their remuneration.
Contribution Reserve
The contribution reserve is used to record the value which arises as a result of transactions with non-controlling
interests that do not result in a loss of control.
- 37 -
- 38 -
Aspire Mining Limited
Aspire Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTE 7: ACCUMULATED LOSSES AND RESERVES (continued)
NOTE 7: ACCUMULATED LOSSES AND RESERVES (continued)
Nature and purpose of reserves (continued)
Options
The following table illustrates the number (No.) and weighted average exercise prices of and movements in
share options issued during the year:
Nature and purpose of reserves (continued)
Performance Rights (continued)
2019
No.
2018
No.
2019
Weighted
average
exercise
price
Outstanding at the beginning of the
year
Granted during the year
Exercised during the year
Expired during the year
875,879,502
12,000,000
(44,591,067)
(142,566,200)
Outstanding at the end of the year
700,722,235
Exercisable at the end of the year
700,722,235
0.019
0.018
0.025
0.025
0.018
0.018
-
875,970,502
(91,000)
-
875,879,502
875,879,502
2018
Weighted
average
exercise
price
-
0.019
0.018
0.019
0.019
The number and details of the 700,722,235 options unexercised at 30 June 2019 ((30 June 2018:
875,879,502) was:
Number
688,722,235
12,000,000
Grant date
11/12/2017
6/12/2018
Expiry date
11/12/2019
11/12/2019
Exercise price $
per option
Fair value at grant
date $ per option
0.018
0.018
0.002
0.006
Performance Rights
The value of the Performance Rights is based on the number of performance rights granted multiplied by the
prevailing share price at the date of the grant of the performance rights. The number of performance rights
issued and the prevailing Share price are known variables.
The vesting requirements applicable to the issued performance rights are based on achievement of
operational and strategic milestones. The value of the performance rights is taken to the Share Based
Payments Reserve progressively over the period the performance rights are expected to vest. The cumulative
expense that will be recorded will equate to the performance rights that ultimately vest.
The number of performance rights unexercised at 30 June 2019 are:
Outstanding at the beginning of the year
Granted during the year
Vested and shares issued during the year
Expired or cancelled during the year
Outstanding at the end of the year
2019
No.
245,300,000
2018
No.
60,000,000
-
205,300,000
(34,216,671)
(14,750,000)
(49,999,999)
(5,250,000)
161,083,330
245,300,000
The vesting requirements applicable to 40,000,000 performance rights issued to a consultant are based on
execution of a Concession Agreement to build and operate the Ovoot to Erdenet Northern Railway and provision
by 31 December 2018 of an offer to fund 70% of the funding required to build the railway. No expense was
recognised as there was no expectation that the funding performance milestone would be met. These
Performance Rights lapsed during the year.
Following from shareholder approval given at the 2017 Annual General Meeting held on 26 November 2017,
55,000,000 performance rights were issued to the nominee of David Paull, 101,800,000 performance rights
were issued to Non-Executive Directors or their nominees, and 48,500,000 performance rights were issued to
employees and qualified contractors on 8 May 2018. The performance milestones attaching to the performance
rights are strategic. One of the six tranches vested and 34,216,671 ordinary shares issued on exercise on 13
July 2018 as the 30 day VWAP of the Company’s Shares as traded on ASX was equal to or greater than A$0.02
by 30 June 2019. 49,999,999 Performance Rights were cancelled on termination of employment.
The remaining performance rights will vest in five tranches if and when one or more of the remaining following
five milestones are achieved:
1.
if 80% or more of the initial issue of 1.8 cent AKMOA listed options are exercised on
or before 11 December 2019.
2.
If following a decision by the Company to mine the Nuurstei Project, or a Board
approved equivalent project, the Company achieves production of a combined
500,000 tonnes per annum of washed hard coking coal by 31 December 2019.
3.
if the Company achieves net profit after tax of at least $10 million by no later than 31
December 2019.
4.
if the 30-day VWAP of the Company’s Shares as traded on ASX is equal to or greater
than A$0.03 by 30 June 2020.
5.
if the 30-day VWAP of the Company’s Shares as traded on ASX is equal to or greater
than A$0.04 by 30 June 2021.
The performance rights are valued at the share price on grant date, being 1.2 cents for each of the performance
rights issued to the Directors and 1.4 cents for each of the performance rights issued to the employees and
contractors.
- 37 -
- 38 -
Aspire Mining Limited
Aspire Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTE 7: ACCUMULATED LOSSES AND RESERVES (continued)
NOTE 7: ACCUMULATED LOSSES AND RESERVES (continued)
The following table illustrates the number (No.) and weighted average exercise prices of and movements in
Performance Rights (continued)
Nature and purpose of reserves (continued)
The vesting requirements applicable to 40,000,000 performance rights issued to a consultant are based on
execution of a Concession Agreement to build and operate the Ovoot to Erdenet Northern Railway and provision
by 31 December 2018 of an offer to fund 70% of the funding required to build the railway. No expense was
recognised as there was no expectation that the funding performance milestone would be met. These
Performance Rights lapsed during the year.
Following from shareholder approval given at the 2017 Annual General Meeting held on 26 November 2017,
55,000,000 performance rights were issued to the nominee of David Paull, 101,800,000 performance rights
were issued to Non-Executive Directors or their nominees, and 48,500,000 performance rights were issued to
employees and qualified contractors on 8 May 2018. The performance milestones attaching to the performance
rights are strategic. One of the six tranches vested and 34,216,671 ordinary shares issued on exercise on 13
July 2018 as the 30 day VWAP of the Company’s Shares as traded on ASX was equal to or greater than A$0.02
by 30 June 2019. 49,999,999 Performance Rights were cancelled on termination of employment.
The remaining performance rights will vest in five tranches if and when one or more of the remaining following
five milestones are achieved:
1.
2.
3.
4.
5.
if 80% or more of the initial issue of 1.8 cent AKMOA listed options are exercised on
or before 11 December 2019.
If following a decision by the Company to mine the Nuurstei Project, or a Board
approved equivalent project, the Company achieves production of a combined
500,000 tonnes per annum of washed hard coking coal by 31 December 2019.
if the Company achieves net profit after tax of at least $10 million by no later than 31
December 2019.
if the 30-day VWAP of the Company’s Shares as traded on ASX is equal to or greater
than A$0.03 by 30 June 2020.
if the 30-day VWAP of the Company’s Shares as traded on ASX is equal to or greater
than A$0.04 by 30 June 2021.
The performance rights are valued at the share price on grant date, being 1.2 cents for each of the performance
rights issued to the Directors and 1.4 cents for each of the performance rights issued to the employees and
contractors.
Nature and purpose of reserves (continued)
Options
share options issued during the year:
2019
No.
2018
No.
2019
Weighted
average
exercise
price
Outstanding at the beginning of the
year
Granted during the year
Exercised during the year
Expired during the year
875,879,502
12,000,000
(44,591,067)
(142,566,200)
Outstanding at the end of the year
700,722,235
Exercisable at the end of the year
700,722,235
0.019
0.018
0.025
0.025
0.018
0.018
-
-
875,970,502
(91,000)
875,879,502
875,879,502
2018
Weighted
average
exercise
price
-
0.019
0.018
0.019
0.019
The number and details of the 700,722,235 options unexercised at 30 June 2019 ((30 June 2018:
875,879,502) was:
Number
688,722,235
12,000,000
Grant date
11/12/2017
6/12/2018
Expiry date
11/12/2019
11/12/2019
Exercise price $
Fair value at grant
per option
date $ per option
0.018
0.018
0.002
0.006
Performance Rights
The value of the Performance Rights is based on the number of performance rights granted multiplied by the
prevailing share price at the date of the grant of the performance rights. The number of performance rights
issued and the prevailing Share price are known variables.
The vesting requirements applicable to the issued performance rights are based on achievement of
operational and strategic milestones. The value of the performance rights is taken to the Share Based
Payments Reserve progressively over the period the performance rights are expected to vest. The cumulative
expense that will be recorded will equate to the performance rights that ultimately vest.
The number of performance rights unexercised at 30 June 2019 are:
Outstanding at the beginning of the year
245,300,000
60,000,000
2019
No.
2018
No.
-
205,300,000
(34,216,671)
(14,750,000)
(49,999,999)
(5,250,000)
161,083,330
245,300,000
Granted during the year
Vested and shares issued during the year
Expired or cancelled during the year
Outstanding at the end of the year
- 39 -
- 40 -
Aspire Mining Limited
Aspire Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTE 8: CASH AND CASH EQUIVALENTS
Cash at bank and on hand
Short term deposits
2019
$
4,546,272
6,589,870
11,136,142
2018
$
1,665,587
5,822,814
7,488,401
Cash at bank earns interest at floating rates based on daily bank deposit rates.
All cash was available for use and no restrictions were placed on the use of it at any time during the period,
other than a short term deposit of $10,000 (2018: $10,000) is on deposit as cash backed security against a
business use credit card limit and office rental.
Reconciliation of loss for the year to net cash flows from operating activities
Total exploration and evaluation expenditure
Loss for the year
Change in net assets and liabilities:
Change in trade and other receivables
Changes in trade and other payables
Profit on sale of property, plant and equipment
Amortisation and depreciation expense
Share based payments
Interest expense settled by issue of shares
Exploration expenditure impairment
Foreign exchange (gain)/loss
Net cash used in operating activities
NOTE 9: CURRENT TRADE AND OTHER RECEIVABLES
GST recoverable
Prepayments
Accrued interest
Other receivables
2019
$
2018
$
(6,200,307)
(6,980,272)
358,224
(603,137)
(27,171)
160,590
344,088
103,931
7,924
(225,738)
(6,081,596)
2019
$
41,468
333,235
24,983
104,605
504,291
(629,537)
(417,764)
(35)
32,015
767,554
833,424
2,627,205
37,139
(3,730,271)
2018
$
18,965
1,238,175
1,530
127,753
1,386,423
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTE 10: DEFERRED EXPLORATION AND EVALUATION EXPENDITURE
Costs carried forward in respect of:
Exploration and evaluation phase – at cost
Balance at beginning of year
Expenditure incurred, net of cost recoveries
Acquisition costs
Impairment of exploration and evaluation expenditure
Foreign exchange loss
Total expenditure incurred and carried forward in respect of specific
projects -
Ovoot Coking Coal Project
Nuurstei Coking Coal Project
Total exploration and evaluation expenditure
Exploration expenditure incurred on projects other than the Ovoot Coking Coal Project and Nuurstei Coking
Coal Project has been impaired, written-off or expensed as that expenditure is not expected to be recouped
through successful development and exploration of the areas of interest, or alternatively, by sale. The
recoupment of the expenditure that has been carried forward is dependent upon the successful development
and commercial exploitation or sale of the respective areas.
As Northern Railways LLC does not currently have in place the funding to build and operate the railway, the
Group has impaired the evaluation expenditure incurred.
NOTE 11: TRADE AND OTHER PAYABLES (CURRENT)
Trade payables
Accrued expenses
Employee entitlements
Corporate credit card
Interest payable
Trade payables and accrued expenses are normally settled on 30 day terms.
2019
$
2018
$
35,609,772
35,875,408
2,578,993
515,221
-
1,684,350
(7,924)
(2,627,205)
(718,965)
161,998
37,461,876
35,609,772
36,235,803
34,484,418
1,226,073
1,125,354
37,461,876
35,609,772
2019
$
241,282
45,205
15,425
7,720
-
309,632
2018
$
575,955
54,861
-
4,366
125,343
760,525
- 39 -
- 40 -
Aspire Mining Limited
Aspire Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTE 8: CASH AND CASH EQUIVALENTS
Cash at bank and on hand
Short term deposits
Cash at bank earns interest at floating rates based on daily bank deposit rates.
All cash was available for use and no restrictions were placed on the use of it at any time during the period,
other than a short term deposit of $10,000 (2018: $10,000) is on deposit as cash backed security against a
business use credit card limit and office rental.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTE 10: DEFERRED EXPLORATION AND EVALUATION EXPENDITURE
Costs carried forward in respect of:
Exploration and evaluation phase – at cost
Balance at beginning of year
Expenditure incurred, net of cost recoveries
Acquisition costs
Impairment of exploration and evaluation expenditure
Foreign exchange loss
Reconciliation of loss for the year to net cash flows from operating activities
Total exploration and evaluation expenditure
Total expenditure incurred and carried forward in respect of specific
projects -
Ovoot Coking Coal Project
Nuurstei Coking Coal Project
Total exploration and evaluation expenditure
2019
$
2018
$
35,609,772
35,875,408
2,578,993
-
515,221
1,684,350
(7,924)
(2,627,205)
(718,965)
161,998
37,461,876
35,609,772
36,235,803
34,484,418
1,226,073
1,125,354
37,461,876
35,609,772
Exploration expenditure incurred on projects other than the Ovoot Coking Coal Project and Nuurstei Coking
Coal Project has been impaired, written-off or expensed as that expenditure is not expected to be recouped
through successful development and exploration of the areas of interest, or alternatively, by sale. The
recoupment of the expenditure that has been carried forward is dependent upon the successful development
and commercial exploitation or sale of the respective areas.
As Northern Railways LLC does not currently have in place the funding to build and operate the railway, the
Group has impaired the evaluation expenditure incurred.
NOTE 11: TRADE AND OTHER PAYABLES (CURRENT)
Trade payables
Accrued expenses
Employee entitlements
Corporate credit card
Interest payable
Trade payables and accrued expenses are normally settled on 30 day terms.
2019
$
241,282
45,205
15,425
7,720
-
309,632
2018
$
575,955
54,861
-
4,366
125,343
760,525
2019
$
4,546,272
6,589,870
11,136,142
2018
$
1,665,587
5,822,814
7,488,401
2019
$
2018
$
(6,200,307)
(6,980,272)
358,224
(603,137)
(27,171)
160,590
344,088
103,931
7,924
(225,738)
(6,081,596)
2019
$
41,468
333,235
24,983
104,605
504,291
(629,537)
(417,764)
(35)
32,015
767,554
833,424
2,627,205
37,139
(3,730,271)
2018
$
18,965
1,238,175
1,530
127,753
1,386,423
Loss for the year
Change in net assets and liabilities:
Change in trade and other receivables
Changes in trade and other payables
Profit on sale of property, plant and equipment
Amortisation and depreciation expense
Share based payments
Interest expense settled by issue of shares
Exploration expenditure impairment
Foreign exchange (gain)/loss
Net cash used in operating activities
NOTE 9: CURRENT TRADE AND OTHER RECEIVABLES
GST recoverable
Prepayments
Accrued interest
Other receivables
- 41 -
- 42 -
Aspire Mining Limited
Aspire Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTE 12: PROPERTY, PLANT AND EQUIPMENT
NOTE 13: INTANGIBLE ASSET
Leasehold
Improvements
Plant &
Equipment
Furniture
&
Fittings
Office
Equipment
Motor
Vehicles
Total
$
$
$
$
$
$
Year ended 30 June
2019
Carrying value at 1
July 2018
Additions
Depreciation charge
for the year
Exchange rate
movement
Carrying value at 30
June 2019
30 June 2019
Cost
Accumulated depreciation
Net carrying amount
Year ended 30 June
2018
Carrying value at 1
July 2017
Additions
Acquired on
acquisition
Depreciation charge
for the year
Exchange rate
movement
Carrying value at 30
June 2018
30 June 2018
Cost
Accumulated depreciation
Net carrying amount
155,686
79,402
16
13,051
21,253
-
62,738
68,710
55,654
154,682
269,408
341,784
(17,280)
(36,915)
(14,551)
(10,502)
(45,986)
(125,234)
(4,115)
(2,345)
(386)
(704)
(1,352)
(8,902)
NOTE 14: FINANCIAL LIABILITIES
134,291
102,880
53,789
57,499
128,597
477,056
1,393,115
(916,059)
477,056
189,145
104,098
174,884
7,452
128
1,126
5,555
67,594
-
14,087
22,417
-
-
6,876
190
-
-
7,066
(17,074)
(4,753)
(302)
(2,714)
(7,172)
(32,015)
(2,124)
2,233
-
552
453
1,114
155,686
79,402
16
13,051
21,253
269,408
1,060,233
(790,825)
269,408
The carrying value of motor vehicles held under a loan agreement at 30 June 2019 is $115,430
(2018: $Nil). The motor vehicle is pledged as security for the loan liability.
Year ended 30 June 2019
Carrying value at 1 July 2018
Additions
Amortisation for the year
Exchange rate movement
At 30 June 2019
At 30 June 2019
Cost
Accumulated amortisation
Net carrying amount
Finance loan liability
Current financial liabilities
Finance loan facility
USD long term facility
Non-current financial liabilities
USD long term facility
Current
Non-current
Exploration Software
$
-
148,783
(35,356)
(809)
112,618
147,976
(35,358)
112,618
2018
$
-
-
-
2018
$
3,246,630
3,246,630
-
3,246,630
3,246,630
38,145
-
2019
$
12,068
12,068
73,411
2019
$
-
-
-
-
-
-
-
3,246,630
73,411
3,246,630
USD long term facility movement for the period
Balance at beginning of period
Repayment from issue of shares
Foreign exchange
Balance at end of period
US$
A$
2,403,481
3,246,630
(2,403,481)
(3,284,775)
In August 2018, the Company entered into a binding agreement with lender and major shareholder, Noble
Resources International Pte Ltd (Noble), to repay up to US$2.4 million (plus interest accruing on that amount)
of the outstanding amount owing under the facility with Noble by way of the issue of Shares at A$0.021 (2.1
cents) per Share. On satisfaction of all conditions precedent, 161,366,954 Shares were issued on 6 December
2018 to settle the loan principle and interest of US$2,479,528 (A$3,388,706).
- 41 -
- 42 -
Aspire Mining Limited
Aspire Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTE 12: PROPERTY, PLANT AND EQUIPMENT
NOTE 13: INTANGIBLE ASSET
Leasehold
Plant &
Improvements
Equipment
Office
Motor
Total
Equipment
Vehicles
Furniture
&
Fittings
$
$
$
$
$
$
155,686
79,402
16
13,051
21,253
-
62,738
68,710
55,654
154,682
269,408
341,784
(17,280)
(36,915)
(14,551)
(10,502)
(45,986)
(125,234)
Year ended 30 June 2019
Carrying value at 1 July 2018
Additions
Amortisation for the year
Exchange rate movement
At 30 June 2019
At 30 June 2019
Cost
Accumulated amortisation
Net carrying amount
(4,115)
(2,345)
(386)
(704)
(1,352)
(8,902)
NOTE 14: FINANCIAL LIABILITIES
134,291
102,880
53,789
57,499
128,597
477,056
174,884
7,452
128
1,126
5,555
67,594
-
14,087
22,417
-
-
6,876
190
-
-
7,066
(17,074)
(4,753)
(302)
(2,714)
(7,172)
(32,015)
(2,124)
2,233
-
552
453
1,114
155,686
79,402
16
13,051
21,253
269,408
1,393,115
(916,059)
477,056
189,145
104,098
1,060,233
(790,825)
269,408
Finance loan liability
Current financial liabilities
Finance loan facility
USD long term facility
Non-current financial liabilities
USD long term facility
Current
Non-current
USD long term facility movement for the period
Balance at beginning of period
Repayment from issue of shares
Foreign exchange
Balance at end of period
Year ended 30 June
2019
Carrying value at 1
July 2018
Additions
Depreciation charge
for the year
Exchange rate
movement
Carrying value at 30
June 2019
30 June 2019
Cost
Accumulated depreciation
Net carrying amount
Year ended 30 June
2018
Carrying value at 1
July 2017
Additions
Acquired on
acquisition
Depreciation charge
for the year
Exchange rate
movement
Carrying value at 30
June 2018
30 June 2018
Cost
Accumulated depreciation
Net carrying amount
Exploration Software
$
-
148,783
(35,356)
(809)
112,618
147,976
(35,358)
112,618
2018
$
-
-
-
2019
$
12,068
12,068
73,411
-
3,246,630
73,411
3,246,630
2019
$
-
-
-
-
2018
$
3,246,630
3,246,630
-
3,246,630
3,246,630
US$
A$
2,403,481
3,246,630
(2,403,481)
(3,284,775)
-
-
38,145
-
The carrying value of motor vehicles held under a loan agreement at 30 June 2019 is $115,430
(2018: $Nil). The motor vehicle is pledged as security for the loan liability.
In August 2018, the Company entered into a binding agreement with lender and major shareholder, Noble
Resources International Pte Ltd (Noble), to repay up to US$2.4 million (plus interest accruing on that amount)
of the outstanding amount owing under the facility with Noble by way of the issue of Shares at A$0.021 (2.1
cents) per Share. On satisfaction of all conditions precedent, 161,366,954 Shares were issued on 6 December
2018 to settle the loan principle and interest of US$2,479,528 (A$3,388,706).
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
- 43 -
- 44 -
Aspire Mining Limited
Aspire Mining Limited
NOTE 14: FINANCIAL LIABILITIES (continued)
NOTE 15: NON-CONTROLLING INTERESTS AND CONTRIBUTION RESERVE (continued)
Finance loan liability
Current liability
Non-current liability
Balance at beginning of period
Addition in the period
Payments
Balance at end of period
2019
$
85,479
85,479
12,068
73,411
85,479
$
-
98,795
(13,316)
85,479
2018
$
-
-
-
-
-
$
-
-
-
-
In August 2018, the Company’s Mongolian subsidiary, Khurgatai Khairkhan LLC, entered into a loan agreement
for two motor vehicles for use by the Ulanbaatar office. The loan is for 180million MNT ($98,795) with monthly
principal instalments of 1.875 million MNT per month (approx. $1,040 pm) and interest at 15.6% pa over the 96
month term.
NOTE 15: NON-CONTROLLING INTERESTS AND CONTRIBUTION RESERVE
There is a 10% non-controlling interest in the corporate entity that holds the Nuurstei Coking Coal mining and
exploration licenses.
There is also a 20% non-controlling interest in Northern Rail Holdings Limited. During 2018, the Group disposed
of a 10% interest in NRML to the Noble Group to bring Noble’s interests in NRML to 20% in exchange for a
US$1.4 million reduction of the long-term facility payable to Noble.
In 2018, the gain on divestment of the shares held by the Company in NRIPL of $1,805,302 was reclassified to
a contribution reserve on consolidation.
Non-controlling interest summary
Coalridge Limited
$
Northern Rail
Holdings Limited
$
Total
$
Coalridge Limited
30 June
2019
13,734
1,230,554
1,244,288
(9,477)
-
(9,477)
1,234,811
30 June
2018
628,025
1,131,519
1,759,544
(725,555)
(725,555)
1,033,989
-
Northern Railway
Holdings Limited
30 June
2019
60,485
30 June
2018
6,482
60,485
6,482
60,485
6,482
-
-
-
3
-
-
-
-
6
Total comprehensive loss for the year
(103,981)
(194,363)
(2,640,775)
(2,402,067)
(742,573)
(1,124,484)
(363,316)
(658,759)
NOTE 16: FINANCIAL INSTRUMENTS
The Group manages its capital to ensure that entities in the Group will be able to continue as a going concern.
The capital structure of the Group consists of cash and cash equivalents and equity attributable to equity holders
of the parent, comprising issued capital, reserves and retained earnings. None of the Group’s entities are subject
to externally imposed capital requirements. Operating cash flows are used to maintain and expand operations,
as well as to make routine expenditures such as tax, dividends and general administrative outgoings. Working
capital, cash and cash equivalents and capital requirements are reviewed by the Board on a regular basis.
Current Assets
Non-Current Assets
Total Assets
Current Liabilities
Non-Current Liabilities
Total Liabilities
Net Assets
Revenue
Loss for the year
Financial assets:
Receivables
Cash and cash equivalents
Financial liabilities:
Trade and other creditors
Borrowings
2019
$
171,056
11,136,142
11,307,198
309,632
85,479
2018
$
148,248
7,488,401
7,636,649
760,525
3,246,630
395,111
4,007,155
The following table details the expected maturities for the Group’s non-derivative financial assets. These have
been drawn up based on contractual maturities of the financial assets except where the Group anticipates that
the cash flow will occur in a different period.
Non-controlling interest arising on the
acquisition of subsidiary
Non-controlling interest arising on part
disposal of subsidiary
Profit/(loss) allocated to non-controlling
interest
Other comprehensive
allocated to non-controlling interest
Balance at 30 June 2018
Profit/(loss) allocated to non-controlling
interest
Other comprehensive
allocated to non-controlling interest
Balance at 30 June 2019
income/(loss)
income/(loss)
171,265
-
171,265
-
(1,031)
(1,031)
(264,078)
(72,663)
(336,741)
23,871
(68,942)
(10,398)
(9,039)
(88,379)
(59,089)
(132,783)
(35,218)
(201,725)
(147,651)
(158,049)
(77,246)
(357,680)
(86,285)
(446,059)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
- 43 -
- 44 -
Aspire Mining Limited
Aspire Mining Limited
NOTE 14: FINANCIAL LIABILITIES (continued)
NOTE 15: NON-CONTROLLING INTERESTS AND CONTRIBUTION RESERVE (continued)
Finance loan liability
Current liability
Non-current liability
Balance at beginning of period
Addition in the period
Payments
Balance at end of period
2019
$
85,479
85,479
12,068
73,411
85,479
$
-
98,795
(13,316)
85,479
2018
$
-
-
-
-
-
-
-
-
-
$
In August 2018, the Company’s Mongolian subsidiary, Khurgatai Khairkhan LLC, entered into a loan agreement
for two motor vehicles for use by the Ulanbaatar office. The loan is for 180million MNT ($98,795) with monthly
principal instalments of 1.875 million MNT per month (approx. $1,040 pm) and interest at 15.6% pa over the 96
month term.
NOTE 15: NON-CONTROLLING INTERESTS AND CONTRIBUTION RESERVE
There is a 10% non-controlling interest in the corporate entity that holds the Nuurstei Coking Coal mining and
exploration licenses.
There is also a 20% non-controlling interest in Northern Rail Holdings Limited. During 2018, the Group disposed
of a 10% interest in NRML to the Noble Group to bring Noble’s interests in NRML to 20% in exchange for a
US$1.4 million reduction of the long-term facility payable to Noble.
In 2018, the gain on divestment of the shares held by the Company in NRIPL of $1,805,302 was reclassified to
a contribution reserve on consolidation.
Non-controlling interest summary
Northern Rail
Coalridge Limited
Holdings Limited
$
$
Total
$
Non-controlling interest arising on the
acquisition of subsidiary
Non-controlling interest arising on part
disposal of subsidiary
Profit/(loss) allocated to non-controlling
interest
Other comprehensive
income/(loss)
allocated to non-controlling interest
Balance at 30 June 2018
Profit/(loss) allocated to non-controlling
interest
Other comprehensive
income/(loss)
allocated to non-controlling interest
Balance at 30 June 2019
171,265
-
171,265
-
(1,031)
(1,031)
(264,078)
(72,663)
(336,741)
23,871
(68,942)
(10,398)
(9,039)
(88,379)
(59,089)
(132,783)
(35,218)
(201,725)
(147,651)
(158,049)
(77,246)
(357,680)
(86,285)
(446,059)
Coalridge Limited
Current Assets
Non-Current Assets
Total Assets
Current Liabilities
Non-Current Liabilities
Total Liabilities
Net Assets
Revenue
Loss for the year
Total comprehensive loss for the year
30 June
2019
13,734
1,230,554
1,244,288
(9,477)
-
(9,477)
1,234,811
(103,981)
(194,363)
30 June
2018
628,025
1,131,519
1,759,544
(725,555)
(725,555)
1,033,989
Northern Railway
Holdings Limited
30 June
2019
60,485
-
60,485
-
30 June
2018
6,482
-
6,482
-
-
-
6,482
-
60,485
-
(2,640,775)
(2,402,067)
3
(742,573)
(1,124,484)
6
(363,316)
(658,759)
NOTE 16: FINANCIAL INSTRUMENTS
The Group manages its capital to ensure that entities in the Group will be able to continue as a going concern.
The capital structure of the Group consists of cash and cash equivalents and equity attributable to equity holders
of the parent, comprising issued capital, reserves and retained earnings. None of the Group’s entities are subject
to externally imposed capital requirements. Operating cash flows are used to maintain and expand operations,
as well as to make routine expenditures such as tax, dividends and general administrative outgoings. Working
capital, cash and cash equivalents and capital requirements are reviewed by the Board on a regular basis.
Financial assets:
Receivables
Cash and cash equivalents
Financial liabilities:
Trade and other creditors
Borrowings
2019
$
171,056
11,136,142
11,307,198
309,632
85,479
2018
$
148,248
7,488,401
7,636,649
760,525
3,246,630
395,111
4,007,155
The following table details the expected maturities for the Group’s non-derivative financial assets. These have
been drawn up based on contractual maturities of the financial assets except where the Group anticipates that
the cash flow will occur in a different period.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
- 45 -
- 46 -
Aspire Mining Limited
Aspire Mining Limited
NOTE 16: FINANCIAL INSTRUMENTS (continued)
Weighted average
effective interest
rate
Less than 1
month
1 – 3
Months
3 months – 1
year
1 – 5
years
5+ years
%
$
$
$
$
$
2019
Non-interest
bearing
Variable interest
rate instruments
Fixed interest rate
instruments
2018
Non-interest
bearing
Variable interest
rate instruments
Fixed interest rate
instruments
0.50
2.66
1.00
2.37
263,798
4,453,531
-
-
-
-
-
4,717,329
6,579,870
6,579,870
10,000
10,000
212,859
1,584,783
-
-
-
-
-
1,797,642
5,829,007
5,829,007
10,000
10,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
The following table details the Group’s remaining contractual maturities for its non-derivative financial
liabilities. These are based on the undiscounted cash flows of financial liabilities based on the earliest date on
which the Group can be required to pay.
Weighted average
effective interest
rate
Less than 1
month
1 – 3
Months
3 months – 1
year
1 – 5
years
5+ years
committee annually.
2019
Non-interest
bearing
Variable interest
rate instruments
Fixed interest rate
instruments
2018
Non-interest
bearing
Variable interest
rate instruments
Fixed interest rate
instruments
%
-
-
15.6
-
-
10.45
$
$
$
$
$
309,634
-
-
309,634
760,525
-
-
760,525
-
-
-
-
-
-
-
-
-
-
-
-
-
-
3,246,630
3,246,630
-
-
-
-
12,068
12,068
73,411
73,411
-
-
-
-
-
-
-
-
NOTE 17: FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
The Group has exposure to the following risks from the use of financial instruments:
• Credit risk
• Liquidity risk
•
Interest rate risk
• Foreign currency risk
• Market risk
This note presents the information about the Group’s exposure to each of the above risks, their objectives,
policies and processes for measuring and managing risk. The Board has overall responsibility for the
establishment and oversight of the risk management framework. The Board reviews and agrees policies for
managing each of these risks as summarised below. The Group’s principal financial instruments comprise cash
and short-term deposits. The main purpose of the financial instruments is to earn the maximum amount of
interest at a low risk to the Group. The Group also has other financial instruments such as receivables and
creditors which arise directly from its operations. For the years ended 30 June 2019 and 2018, it has been the
Group’s policy not to trade in financial instruments.
(a)
Credit risk management
Credit risk refers to the risk that a counter-party will default on its contractual obligations resulting in financial
loss to the Group. The Group has adopted a policy of only dealing with creditworthy counterparties and obtaining
sufficient collateral where appropriate, as a means of mitigating the risk of financial loss from defaults. The
Group only transacts with entities that are rated the equivalent of investment grade and above. This information
is supplied by independent rating agencies where available and, if not available, the Group uses publicly
available financial information. The Group’s exposure and the credit ratings of its counterparties are continuously
monitored and the aggregate value of transactions concluded is spread amongst approved counterparties.
Credit exposure is controlled by counterparty limits that are reviewed and approved by the risk management
The Group does not have any significant credit risk exposure to any single counterparty or any Group of
counterparties having similar characteristics. The credit risk on liquid funds and derivative financial instruments
is limited because the counterparties are banks with high credit ratings assigned by international credit rating
The carrying amount of financial assets recorded in the financial statements, net of any allowance for losses,
represents the Group’s maximum exposure to credit risk without taking account of the value of any collateral
agencies.
obtained.
(b)
Liquidity risk management
Ultimate responsibility for liquidity risk management rests with the Board, who have built an appropriate liquidity
risk management framework for the management of the Group’s short, medium and long-term funding and
liquidity management requirements. The Group manages liquidity risk by maintaining adequate reserves and
banking by continuously monitoring forecast and actual cash flows and matching the maturity profiles of financial
assets and liabilities. The Group did not have any undrawn facilities at balance date (2018: $3,246,630).
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
- 45 -
- 46 -
Aspire Mining Limited
Aspire Mining Limited
NOTE 16: FINANCIAL INSTRUMENTS (continued)
Weighted average
effective interest
Less than 1
month
1 – 3
Months
3 months – 1
1 – 5
years
5+ years
$
$
$
$
year
$
2019
Non-interest
bearing
Variable interest
rate instruments
Fixed interest rate
instruments
2018
Non-interest
bearing
Variable interest
rate instruments
Fixed interest rate
instruments
2019
Non-interest
bearing
Variable interest
rate instruments
Fixed interest rate
instruments
2018
Non-interest
bearing
Variable interest
rate instruments
Fixed interest rate
instruments
rate
%
0.50
2.66
1.00
2.37
rate
%
15.6
-
-
-
-
10.45
1,797,642
-
5,829,007
5,829,007
10,000
10,000
The following table details the Group’s remaining contractual maturities for its non-derivative financial
liabilities. These are based on the undiscounted cash flows of financial liabilities based on the earliest date on
which the Group can be required to pay.
Weighted average
effective interest
Less than 1
month
1 – 3
Months
3 months – 1
year
1 – 5
years
5+ years
$
$
$
$
$
4,717,329
-
6,579,870
6,579,870
10,000
10,000
263,798
4,453,531
212,859
1,584,783
309,634
309,634
760,525
-
-
-
-
760,525
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
12,068
12,068
73,411
73,411
3,246,630
3,246,630
NOTE 17: FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
The Group has exposure to the following risks from the use of financial instruments:
• Credit risk
• Liquidity risk
•
Interest rate risk
• Foreign currency risk
• Market risk
This note presents the information about the Group’s exposure to each of the above risks, their objectives,
policies and processes for measuring and managing risk. The Board has overall responsibility for the
establishment and oversight of the risk management framework. The Board reviews and agrees policies for
managing each of these risks as summarised below. The Group’s principal financial instruments comprise cash
and short-term deposits. The main purpose of the financial instruments is to earn the maximum amount of
interest at a low risk to the Group. The Group also has other financial instruments such as receivables and
creditors which arise directly from its operations. For the years ended 30 June 2019 and 2018, it has been the
Group’s policy not to trade in financial instruments.
Credit risk management
(a)
Credit risk refers to the risk that a counter-party will default on its contractual obligations resulting in financial
loss to the Group. The Group has adopted a policy of only dealing with creditworthy counterparties and obtaining
sufficient collateral where appropriate, as a means of mitigating the risk of financial loss from defaults. The
Group only transacts with entities that are rated the equivalent of investment grade and above. This information
is supplied by independent rating agencies where available and, if not available, the Group uses publicly
available financial information. The Group’s exposure and the credit ratings of its counterparties are continuously
monitored and the aggregate value of transactions concluded is spread amongst approved counterparties.
Credit exposure is controlled by counterparty limits that are reviewed and approved by the risk management
committee annually.
The Group does not have any significant credit risk exposure to any single counterparty or any Group of
counterparties having similar characteristics. The credit risk on liquid funds and derivative financial instruments
is limited because the counterparties are banks with high credit ratings assigned by international credit rating
agencies.
The carrying amount of financial assets recorded in the financial statements, net of any allowance for losses,
represents the Group’s maximum exposure to credit risk without taking account of the value of any collateral
obtained.
(b)
Liquidity risk management
Ultimate responsibility for liquidity risk management rests with the Board, who have built an appropriate liquidity
risk management framework for the management of the Group’s short, medium and long-term funding and
liquidity management requirements. The Group manages liquidity risk by maintaining adequate reserves and
banking by continuously monitoring forecast and actual cash flows and matching the maturity profiles of financial
assets and liabilities. The Group did not have any undrawn facilities at balance date (2018: $3,246,630).
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
- 47 -
- 48 -
Aspire Mining Limited
Aspire Mining Limited
NOTE 17: FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (continued)
(c)
Interest rate risk management
The Group is exposed to interest rate risk as the Group deposits the bulk of the Group’s cash reserves in term
deposits with the National Australia Bank (“NAB”). The risk is managed by the Group by maintaining an
appropriate mix between short term and medium-term deposits. The Group’s exposures to interest rate on
financial assets and financial liabilities are detailed in the liquidity risk management section of this note.
Interest rate sensitivity
At 30 June 2019, the effect on loss and equity as a result of changes in the interest rate, with all other variable
remaining constant would be as follows:
Change in Loss
Increase in interest rate by 1%
Decrease in interest rate by 1%
Change in Equity
Increase in interest rate by 1%
Decrease in interest rate by 1%
2019
$
44,535
(44,535)
2018
$
15,848
(15,848)
44,535
44,535
15,848
(15,848)
(d)
Foreign currency risk management
(e)
Market risk management
The Group undertakes certain transactions denominated in foreign currencies hence exposures to exchange
rate fluctuations arise. The Group does not manage these exposures with foreign currency derivative products.
The carrying amounts of the Group’s foreign currency denominated monetary assets and monetary liabilities at
the balance date expressed in Australian dollars are as follows:
US Dollars
Mongolian Tugriks
Liabilities
2019
$
2018
$
-
103,670
3,246,630
462,968
Assets
2019
$
2018
$
4,028,639
1,907,147
580,549
3,503,583
Foreign currency sensitivity analysis
The Group is exposed to US Dollar (USD) and Mongolian Tugrik currency fluctuations.
The Group has entered into remuneration commitments with all the Directors and other key management
personnel of the Group which were in effect throughout the financial year. The Group also employs consultants
who are contracted under standard consultancy rates.
The following table details the Group’s sensitivity to a 10% increase and decrease in the Australian dollar against
the relevant foreign currencies. 10% is the sensitivity rate used when reporting foreign currency risk internally
to key management personnel and represent management’s assessment of the possible change in foreign
exchange rates. The sensitivity analysis includes only outstanding foreign currency denominated monetary
items and adjusts their translation at the period end for a 10% change in foreign currency rates. The sensitivity
analysis includes external loans as well as loans to foreign operations within the Group where the denomination
of the loan is in a currency other than the currency of the lender or the borrower. A positive number indicates an
increase in profit and equity where the Australian Dollar weakens against the respective currency. For a
strengthening of the Australian Dollar against the respective currency there would be an equal and opposite
impact on the profit and equity and the balances below would be negative.
The Group has certain commitments to meet minimum expenditure requirements on the mineral exploration
assets it has an interest in. Outstanding exploration commitments are as follows:
Within a year
Later than one year but not later than five years
2019
$
27,953
128,700
2018
$
156,154
110,570
NOTE 17: FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (continued)
10% Increase
2019
$
2018
$
Profit/(loss) and equity – US dollar exposure
366,240
242,371
Profit/(loss) and equity – Mongolian Tugrik
164,209
276,419
10% Decrease
$
$
Profit/(loss) and equity – US dollar exposure
(447,627)
(296,231)
Profit/(loss) and equity – Mongolian Tugrik
(200,700)
(337,846)
Market risk is the risk that changes in market prices such as foreign exchange rates, interest rates and equity
prices will affect the Group’s income or value of the holdings of financial instruments. The Group is exposed to
movements in market interest rates on short term deposits. The Group does not have short-term or long-term
debt with variable interest rates, and therefore this risk is minimal. The Group limits its exposure to credit risk by
only investing in liquid securities and only with counterparties that have acceptable credit ratings.
The carrying value of the financial assets and liabilities in the financial statements approximates their fair value.
NOTE 18: COMMITMENTS
Remuneration Commitments
Exploration Commitments
- 47 -
- 48 -
Aspire Mining Limited
Aspire Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTE 17: FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (continued)
(c)
Interest rate risk management
The Group is exposed to interest rate risk as the Group deposits the bulk of the Group’s cash reserves in term
deposits with the National Australia Bank (“NAB”). The risk is managed by the Group by maintaining an
appropriate mix between short term and medium-term deposits. The Group’s exposures to interest rate on
financial assets and financial liabilities are detailed in the liquidity risk management section of this note.
NOTE 17: FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (continued)
10% Increase
2019
$
2018
$
Profit/(loss) and equity – US dollar exposure
366,240
242,371
At 30 June 2019, the effect on loss and equity as a result of changes in the interest rate, with all other variable
Profit/(loss) and equity – Mongolian Tugrik
164,209
276,419
2019
$
44,535
(44,535)
2018
$
15,848
(15,848)
44,535
44,535
15,848
(15,848)
10% Decrease
$
$
Profit/(loss) and equity – US dollar exposure
(447,627)
(296,231)
Profit/(loss) and equity – Mongolian Tugrik
(200,700)
(337,846)
Interest rate sensitivity
remaining constant would be as follows:
Change in Loss
Increase in interest rate by 1%
Decrease in interest rate by 1%
Change in Equity
Increase in interest rate by 1%
Decrease in interest rate by 1%
(d)
Foreign currency risk management
(e)
Market risk management
The Group undertakes certain transactions denominated in foreign currencies hence exposures to exchange
rate fluctuations arise. The Group does not manage these exposures with foreign currency derivative products.
The carrying amounts of the Group’s foreign currency denominated monetary assets and monetary liabilities at
the balance date expressed in Australian dollars are as follows:
Liabilities
2019
$
-
103,670
2018
$
3,246,630
462,968
Assets
2019
$
2018
$
4,028,639
1,907,147
580,549
3,503,583
US Dollars
Mongolian Tugriks
Foreign currency sensitivity analysis
The Group is exposed to US Dollar (USD) and Mongolian Tugrik currency fluctuations.
The following table details the Group’s sensitivity to a 10% increase and decrease in the Australian dollar against
the relevant foreign currencies. 10% is the sensitivity rate used when reporting foreign currency risk internally
to key management personnel and represent management’s assessment of the possible change in foreign
exchange rates. The sensitivity analysis includes only outstanding foreign currency denominated monetary
items and adjusts their translation at the period end for a 10% change in foreign currency rates. The sensitivity
analysis includes external loans as well as loans to foreign operations within the Group where the denomination
of the loan is in a currency other than the currency of the lender or the borrower. A positive number indicates an
increase in profit and equity where the Australian Dollar weakens against the respective currency. For a
strengthening of the Australian Dollar against the respective currency there would be an equal and opposite
impact on the profit and equity and the balances below would be negative.
Market risk is the risk that changes in market prices such as foreign exchange rates, interest rates and equity
prices will affect the Group’s income or value of the holdings of financial instruments. The Group is exposed to
movements in market interest rates on short term deposits. The Group does not have short-term or long-term
debt with variable interest rates, and therefore this risk is minimal. The Group limits its exposure to credit risk by
only investing in liquid securities and only with counterparties that have acceptable credit ratings.
The carrying value of the financial assets and liabilities in the financial statements approximates their fair value.
NOTE 18: COMMITMENTS
Remuneration Commitments
The Group has entered into remuneration commitments with all the Directors and other key management
personnel of the Group which were in effect throughout the financial year. The Group also employs consultants
who are contracted under standard consultancy rates.
Exploration Commitments
The Group has certain commitments to meet minimum expenditure requirements on the mineral exploration
assets it has an interest in. Outstanding exploration commitments are as follows:
Within a year
Later than one year but not later than five years
2019
$
27,953
128,700
2018
$
156,154
110,570
- 49 -
Aspire Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTE 18: COMMITMENTS
Motor Vehicle Loan Commitment
During the year, the Group entered into a loan agreement to purchase two motor vehicles.
Within a year
Later than one year but not later than five years
More than 5 years
Total liability
Less unexpired interest
Present value
Represented by:
Current liability
Non-current liability:
2018
$
-
-
-
-
-
2019
$
24,578
79,366
29,400
133,344
(47,865)
85,479
12,068
73,411
Investment Consideration Commitments
Pursuant to the initial acquisition from Xanadu Limited of the 50% interest in Coalridge Limited that owns 90%
interest in the Nuurstei Coking Coal Project (Nuurstei Project), 5 million shares in Aspire are to be issued to
Xanadu in the event that 30 million tonnes of JORC compliant resources are identified in the Nuurstei Project
area.
NOTE 19: DIVIDENDS
The Directors of the Group have not declared any dividend for the year ended 30 June 2019.
NOTE 20: CONTINGENT LIABILITIES
There are no contingent liabilities at 30 June 2019.
NOTE 21: EVENTS SUBSEQUENT TO REPORTING DATE
In September 2019, the Company entered into a Subscription Agreement with existing substantial shareholder,
Mr. Tserenpuntsag Tserendamba, to complete a Placement for 1,595.9 million shares at 2.1 cents per share to
raise $33.5 million before costs to further fund the Ovoot Early Development Plan (OEDP) pre-development
activities and for general working capital. The OEDP will involve mining a low ash and high yielding coal from a
starter pit that sits within the previously defined Ovoot orebody and construction of a new private haul road.
The Placement to Mr Tserenpuntsag is conditional upon an independent expert report opining that the
Placement and its outcomes are reasonable, if not fair, to the Company’s shareholders and the shareholders
considering, and if thought fit, approving the Placement at a meeting of shareholders.
Following the Placement there is an intended restructuring of the Aspire Board of Directors and management
roles and a 1 for 10 consolidation of the Aspire securities on issue.
Other than the above, there has not been any material matter or circumstance that has arisen after balance date
that has significantly affected, or may significantly affect, the operations of the Group, the results of those
operations, or the state of affairs of the Group in future financial periods.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTE 18: COMMITMENTS
Motor Vehicle Loan Commitment
During the year, the Group entered into a loan agreement to purchase two motor vehicles.
2018
$
-
-
-
-
-
2019
$
24,578
79,366
29,400
133,344
(47,865)
85,479
12,068
73,411
Within a year
More than 5 years
Total liability
Less unexpired interest
Present value
Represented by:
Current liability
Non-current liability:
area.
NOTE 19: DIVIDENDS
Investment Consideration Commitments
Pursuant to the initial acquisition from Xanadu Limited of the 50% interest in Coalridge Limited that owns 90%
interest in the Nuurstei Coking Coal Project (Nuurstei Project), 5 million shares in Aspire are to be issued to
Xanadu in the event that 30 million tonnes of JORC compliant resources are identified in the Nuurstei Project
The Directors of the Group have not declared any dividend for the year ended 30 June 2019.
NOTE 20: CONTINGENT LIABILITIES
There are no contingent liabilities at 30 June 2019.
NOTE 21: EVENTS SUBSEQUENT TO REPORTING DATE
In September 2019, the Company entered into a Subscription Agreement with existing substantial shareholder,
Mr. Tserenpuntsag Tserendamba, to complete a Placement for 1,595.9 million shares at 2.1 cents per share to
raise $33.5 million before costs to further fund the Ovoot Early Development Plan (OEDP) pre-development
activities and for general working capital. The OEDP will involve mining a low ash and high yielding coal from a
starter pit that sits within the previously defined Ovoot orebody and construction of a new private haul road.
The Placement to Mr Tserenpuntsag is conditional upon an independent expert report opining that the
Placement and its outcomes are reasonable, if not fair, to the Company’s shareholders and the shareholders
considering, and if thought fit, approving the Placement at a meeting of shareholders.
Following the Placement there is an intended restructuring of the Aspire Board of Directors and management
roles and a 1 for 10 consolidation of the Aspire securities on issue.
Other than the above, there has not been any material matter or circumstance that has arisen after balance date
that has significantly affected, or may significantly affect, the operations of the Group, the results of those
operations, or the state of affairs of the Group in future financial periods.
- 49 -
- 50 -
Aspire Mining Limited
Aspire Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTE 22: DIRECTORS AND EXECUTIVE DISCLOSURES
The totals of remuneration paid to key management personnel of the company during the year are as follows:
Later than one year but not later than five years
Short-term employee benefits
Post-employment benefits
Share-based payments
2019
$
645,524
2,603
280,698
928,825
2018
$
221,400
-
435,388
656,788
Share based payments is the gross accounting value of performance rights brought to account in accordance
with accounting standards.
Related Party Transactions
As at 30 June 2019, there were unpaid Directors’ Fees payable of $111,486 (2018: $3,400).
2018
$
46,250
870
47,120
2018
$
49,443
13,822
63,265
NOTE 23: AUDITOR’S REMUNERATION
The auditor of Aspire Mining Limited is HLB Mann Judd.
Amounts received or due and receivable by HLB Mann Judd for:
An audit or review of the financial reports
Other services
2019
$
49,000
3,744
52,744
The auditor of Khurgatai Khairkhan LLC, its direct subsidiaries and Northern Railways LLC is KPMG.
Amounts received or due and receivable by KPMG:
An audit or review of the financial reports
Other services
NOTE 24: PARENT ENTITY DISCLOSURES
Financial position
Assets
Current assets
Non-current assets
Total assets
Liabilities
Current liabilities
Non-current liabilities
Total liabilities
Net assets
Equity
Issued capital
Reserves
Accumulated losses
Total equity
2019
$
46,359
-
46,359
2019
$
9,262,900
6,193,600
15,456,500
291,320
-
291,320
15,165,180
114,897,715
1,167,852
(100,900,387)
15,165,180
*1. 20,000 options held in the Name of Russell Lynton Brown.
2. 4,020,000 options held in the name of Husif Nominees Pty Ltd ; Mr Lynton-Brown is a
Director and controlling shareholder.
2018
$
4,736,085
6,021,032
10,757,117
144,608
-
144,608
10,612,509
99,087,130
1,250,531
(89,725,152)
10,612,509
- 51 -
- 52 -
Aspire Mining Limited
Aspire Mining Limited
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTE 24: PARENT ENTITY DISCLOSURES (continued)
Financial performance
Operating loss for the year
Total comprehensive loss
Year ended
30 June 2019
$
(11,175,235)
(11,175,235)
Year ended
30 June 2018
$
(12,054,982)
(12,054,982)
Parent Company Capital Commitments and Contingent Liabilities
The parent entity currently has no capital commitments for the acquisition of property, plant and equipment.
See Note 18 for obligations of Aspire to issue securities.
DIRECTORS’ DECLARATION
In the opinion of the Directors of Aspire Mining Limited (‘the Company’):
1.
The financial statements and notes of the Group are in accordance with the Corporations Act 2001
including:
a.
b.
giving a true and fair view of the Group’s financial position as at 30 June 2019 and of its
performance for the year then ended; and
complying with Accounting Standards and Corporations Regulations 2001.
2.
There are reasonable grounds to believe that the Company will be able to pay its debts as and when
they become due and payable.
3.
The financial statements and notes are in accordance with International Financial Standards issued by
the International Accounting Standards Board.
4.
This declaration has been made after receiving the declarations required to be made to the Directors in
accordance with Section 295A of the Corporations Act 2001 for the financial year ended 30 June 2019.
NOTE 25: SUBSIDIARIES
This declaration is signed in accordance with a resolution of the Board of Directors.
The consolidated financial statements include the financial statements of Aspire Mining Limited and its below
subsidiaries.
% Equity Owned
Investment
David Paull
Executive Chairman
26 September 2019
Subsidiary Name
Khurgatai Khairkhan LLC
Ovoot Coal Mining LLC
Chilchig Gol LLC
Ovoot Coking Coal Pte Ltd
Northern Railways LLC
Northern Railways Holdings LLC
Northern Railways Pte Ltd
Northern Mongolian Railways Limited
Coalridge Limited
Ekhgoviin Chuluu LLC
Black Rock LLC
CEADM LLC1
1 Deregistered in the Period
Country of incorporation
Mongolia
Mongolia
Mongolia
Singapore
Mongolia
Mongolia
Singapore
British Virgin Islands
British Virgin Islands
Mongolia
Mongolia
2019
100%
100%
100%
100%
80%
80%
80%
80%
100%
100%
90%
-
2019
-
-
-
2018
2018
-
100%
-
100%
100%
-
100% $9,428,158 $9,428,158
-
$136,230
$1
$97,408
100% $1,541,390 $1,541,390
-
100%
-
90%
-
51%
-
$136,230
$1
$97,408
80%
80%
80%
80%
-
-
-
Aspire Mining Limited is the ultimate Australian parent entity and ultimate parent of the Group. Transactions
between these parties involved the provision of funding for operations. As at 30 June 2019 and before
impairment, amounts of $52,920,821 (2018: $47,963,903), $20,890,902 (2018: $17,308,307), $138,409 (2018:
$138,409), $1,274,439 (2018: $1,260,558), $14,617 (2018: $10,708) and $395,185 (2018: $647,991) were owed
by Khurgatai Khairkhan LLC, Ovoot Coking Coal Pte Ltd, Northern Railway Holdings LLC, Northern Railways
Pte Ltd, Northern Mongolian Railways Limited and Ekhgoviin Chuluu LLC to the parent entity, respectively. The
loans have been impaired.
- 52 -
Aspire Mining Limited
DIRECTORS’ DECLARATION
In the opinion of the Directors of Aspire Mining Limited (‘the Company’):
1.
The financial statements and notes of the Group are in accordance with the Corporations Act 2001
including:
a.
b.
giving a true and fair view of the Group’s financial position as at 30 June 2019 and of its
performance for the year then ended; and
complying with Accounting Standards and Corporations Regulations 2001.
There are reasonable grounds to believe that the Company will be able to pay its debts as and when
they become due and payable.
The financial statements and notes are in accordance with International Financial Standards issued by
the International Accounting Standards Board.
This declaration has been made after receiving the declarations required to be made to the Directors in
accordance with Section 295A of the Corporations Act 2001 for the financial year ended 30 June 2019.
2.
3.
4.
This declaration is signed in accordance with a resolution of the Board of Directors.
David Paull
Executive Chairman
26 September 2019
- 53 -
INDEPENDENT AUDITOR’S REPORT
To the members of Aspire Mining Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Aspire Mining Limited (“the Company”) and its controlled
entities (“the Group”), which comprises the consolidated statement of financial position as at 30
June 2019, 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 statements, 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:
a) giving a true and fair view of the Group’s financial position as at 30 June 2019 and of its
financial performance for the year then ended; and
b) 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
auditor independence requirements of 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 (“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 believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
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. We have determined the matters described below to
be the key audit matters to be communicated in our report.
- 54 -
Key Audit Matter
How our audit addressed the key audit
matter
Deferred exploration and evaluation expenditure
(Note 10 in the annual financial report)
In accordance with AASB 6 Exploration for and
Evaluation of Mineral Resources, the Group
capitalises acquisition costs of rights to explore as
well as subsequent exploration and evaluation
expenditure and applies the cost model after
recognition.
Our audit focussed on the Group’s assessment of
the carrying amount of the capitalised exploration
and evaluation asset. We considered this to be a
key audit matter because this is the most significant
asset of the Group. There is a risk that the
capitalised expenditure no longer meets the
recognition criteria of the standard. In addition, we
considered it necessary to assess whether facts
and circumstances existed to suggest that the
carrying amount of the exploration and evaluation
asset may exceed its recoverable amount.
Our procedures included but were not
limited to the following:
• We obtained an understanding of
the key processes associated with
management’s review of the
exploration and evaluation asset
carrying values;
• We considered the Directors’
assessment of potential indicators of
impairment;
• We obtained evidence that the
Group has current rights to tenure of
its areas of interest;
• We examined the exploration budget
and discussed with management the
nature of planned ongoing activities;
and
• We examined the disclosures made
in the financial report.
Information other than the financial report and auditor’s report thereon
The directors are responsible for the other information. The other information comprises the
information included in the Group’s annual report for the year ended 30 June 2019, but does not
include the financial report and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and accordingly 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 have no realistic alternative but to do so.
- 55 -
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 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.
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional
judgement and maintain professional scepticism throughout the audit. We also:
-
Identify and assess the risks of material misstatement of the financial report, whether due to
fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not
detecting a material misstatement resulting from fraud is higher than for one resulting from
error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the
override of internal control.
-
-
- Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing
an opinion on the effectiveness of the Group’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by the directors.
Conclude on the appropriateness of the directors’ use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to
events or conditions that may cast significant doubt on the Group’s ability to continue as a
going concern. If we conclude that a material uncertainty exists, we are required to draw
attention in our auditor’s report to the related disclosures in the financial report or, if such
disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit
evidence obtained up to the date of our auditor’s report. However, future events or conditions
may cause the Group to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial report, including the
disclosures, and whether the financial report represents the underlying transactions and
events in a manner that achieves fair presentation.
-
- Obtain sufficient appropriate audit evidence regarding the financial information of the entities
or business activities within the Group to express an opinion on the financial report. We are
responsible for the direction, supervision and performance of the Group audit. We remain
solely responsible for our audit opinion.
We communicate with the directors regarding, among other matters, the planned scope and timing
of the audit and significant audit findings, including any significant deficiencies in internal control
that we identify during our audit.
We also provide the directors with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other
matters that may reasonably be thought to bear on our independence, and where applicable,
related safeguards.
From the matters communicated with the directors, we determine those matters that were of most
significance in the audit of the financial report of the current period and are therefore the key audit
matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter
should not be communicated in our report because the adverse consequences of doing so would
reasonably be expected to outweigh the public interest benefits of such communication.
- 56 -
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included within the directors’ report for the year ended
30 June 2019.
In our opinion, the Remuneration Report of Aspire Mining Limited for the year ended 30 June 2019
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.
HLB Mann Judd
Chartered Accountants
Perth, Western Australia
26 September 2019
N G Neill
Partner
- 57 -
- 58 -
ADDITIONAL SHAREHOLDER INFORMATION
Additional information required pursuant to the ASX Listing Rules and not shown elsewhere in this report is
as follows. The information is current as at 24 October 2019.
1.
Substantial Shareholders
There are three substantial shareholders:
§ Mr Terenpuntsag Tserendamba, 914,534,573 shares or 27.49% on an undiluted basis
§ Noble Resources International Pte Ltd, 664,017,577 shares or 19.96% on an undiluted basis
§ Spectral Investments Pty Ltd, a company controlled by Mr Neil Lithgow, 237,278,501 shares or 7.13% on
an undiluted basis
There are four substantial option holders:
§ Mr Terenpuntsag Tserendamba, 153,330,119 options or 21.88%
§ Noble Resources International Pte Ltd, 74,158,176 options or 10.58%
§ Mentok Pty Ltd, 54,743,019 options or 7.81%
§ CS Third Nominees Pty Ltd, 45,813,970 options or 6.54%
There are five substantial unlisted performance rights holder:
§ 2Rs Pty Ltd, a company controlled by Mr David Paull, 45,833,333 performance rights, or 30%
§ Spectral Investments Pty Ltd, a company controlled by Mr Neil Lithgow, 36,250,000 performance rights or
24%
§ Gan-Ochir Zunduisuren, 30,500,000 performance rights or 20%
§ Hannah Badenach, 18,083,333 performance rights or 12%
§ Barkdell Services Pty Ltd, 14,166,666 performance rights or 9%
2.
Number of holders in each class of equity securities and the voting rights attached
Ordinary Shares
There are 2,847 holders of ordinary shares. Each shareholder is entitled to one vote per share held. In accordance
with the Company’s Constitution, on a show of hands every member present in person or by proxy or attorney or
duly authorised representative has one vote. On a poll every member present in person or by proxy or attorney
or duly authorised representative has one vote for every fully paid ordinary share held.
Options
There are 383 holders of unlisted options. The options are exercisable at A$0.018 per option on or before 11
December 2019. There are no voting rights attached to these options. If exercised, each option will be converted
into one fully paid ordinary share in the Company which will share the same voting rights as existing outstanding
ordinary shares.
Performance Rights
There are nine holders of performance rights. There are no voting rights attached to the performance rights.
ADDITIONAL SHAREHOLDER INFORMATION (continued)
3. Distribution schedule of the number of holders in each class of equity security
a) Fully Paid Ordinary Shares
Spread of Holdings
Holders
b) Options exercisable at A$0.018 on or before 11 December 2019
Spread of Holdings
Holders
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 –
TOTAL ON REGISTER
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 –
TOTAL ON REGISTER
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 –
TOTAL ON REGISTER
252
271
249
971
1,104
2,847
17
36
19
117
194
383
-
-
-
-
9
9
Units
41,532
854,465
2,104,302
44,500,091
3,279,040,685
3,326,541,075
Units
6,653
95,412
138,541
4,956,659
695,524,970
700,722,235
-
-
-
-
152,749,997
152,749,997
%
0.00 %
0.03 %
0.06 %
1.34 %
98.57%
100.00 %
%
0.00 %
0.01 %
0.02 %
0.71 %
99.26 %
100.00 %
%
0.00 %
0.00 %
0.00 %
0.00 %
100.00 %
100.00 %
c) Unlisted Performance Rights that vest at various dates
Spread of Holdings
Holders
Units
4. Marketable Parcel
There are 1,296 shareholders with less than a marketable parcel.
5.
Twenty largest holders of each class of quoted equity security
The names of the twenty largest registered holders of each class of security, the number of equity security each
holds and the percentage of capital each holds are as follows on the next page;
- 57 -
- 58 -
ADDITIONAL SHAREHOLDER INFORMATION
Additional information required pursuant to the ASX Listing Rules and not shown elsewhere in this report is
as follows. The information is current as at 24 October 2019.
ADDITIONAL SHAREHOLDER INFORMATION (continued)
3. Distribution schedule of the number of holders in each class of equity security
1.
Substantial Shareholders
There are three substantial shareholders:
§ Mr Terenpuntsag Tserendamba, 914,534,573 shares or 27.49% on an undiluted basis
§ Noble Resources International Pte Ltd, 664,017,577 shares or 19.96% on an undiluted basis
§ Spectral Investments Pty Ltd, a company controlled by Mr Neil Lithgow, 237,278,501 shares or 7.13% on
an undiluted basis
There are four substantial option holders:
§ Mr Terenpuntsag Tserendamba, 153,330,119 options or 21.88%
§ Noble Resources International Pte Ltd, 74,158,176 options or 10.58%
§ Mentok Pty Ltd, 54,743,019 options or 7.81%
§ CS Third Nominees Pty Ltd, 45,813,970 options or 6.54%
There are five substantial unlisted performance rights holder:
§ 2Rs Pty Ltd, a company controlled by Mr David Paull, 45,833,333 performance rights, or 30%
§ Spectral Investments Pty Ltd, a company controlled by Mr Neil Lithgow, 36,250,000 performance rights or
24%
§ Gan-Ochir Zunduisuren, 30,500,000 performance rights or 20%
§ Hannah Badenach, 18,083,333 performance rights or 12%
§ Barkdell Services Pty Ltd, 14,166,666 performance rights or 9%
2.
Number of holders in each class of equity securities and the voting rights attached
Ordinary Shares
There are 2,847 holders of ordinary shares. Each shareholder is entitled to one vote per share held. In accordance
with the Company’s Constitution, on a show of hands every member present in person or by proxy or attorney or
duly authorised representative has one vote. On a poll every member present in person or by proxy or attorney
or duly authorised representative has one vote for every fully paid ordinary share held.
There are 383 holders of unlisted options. The options are exercisable at A$0.018 per option on or before 11
December 2019. There are no voting rights attached to these options. If exercised, each option will be converted
into one fully paid ordinary share in the Company which will share the same voting rights as existing outstanding
Options
ordinary shares.
Performance Rights
There are nine holders of performance rights. There are no voting rights attached to the performance rights.
a) Fully Paid Ordinary Shares
Spread of Holdings
Holders
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 –
TOTAL ON REGISTER
252
271
249
971
1,104
2,847
Units
41,532
854,465
2,104,302
44,500,091
3,279,040,685
3,326,541,075
b) Options exercisable at A$0.018 on or before 11 December 2019
Spread of Holdings
Holders
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 –
TOTAL ON REGISTER
17
36
19
117
194
383
Units
6,653
95,412
138,541
4,956,659
695,524,970
700,722,235
c) Unlisted Performance Rights that vest at various dates
Spread of Holdings
Holders
Units
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 –
TOTAL ON REGISTER
-
-
-
-
9
9
-
-
-
-
152,749,997
152,749,997
%
0.00 %
0.03 %
0.06 %
1.34 %
98.57%
100.00 %
%
0.00 %
0.01 %
0.02 %
0.71 %
99.26 %
100.00 %
%
0.00 %
0.00 %
0.00 %
0.00 %
100.00 %
100.00 %
4. Marketable Parcel
There are 1,296 shareholders with less than a marketable parcel.
5.
Twenty largest holders of each class of quoted equity security
The names of the twenty largest registered holders of each class of security, the number of equity security each
holds and the percentage of capital each holds are as follows on the next page;
ADDITIONAL SHAREHOLDER INFORMATION (continued)
ADDITIONAL SHAREHOLDER INFORMATION (continued)
- 59 -
- 60 -
Ordinary Shares Top 20 holders and percentage held
Holder Name
1 Noble Resources International Pte Ltd
2 Mr Tserenpuntsag Tserendamba
3 MICC LLC(i)
4 Spectral Investments Pty Ltd
5 HSBC Custody Nominees Australia Limited
6 China Tonghai Securities Ltd
7 BNP Paribas Nominees Pty Ltd
8 Custodial Services Limited
9 J P Morgan Nominees Australia Pty Ltd
10 2R’s Pty Ltd
11 Citicorp Nominees Pty Ltd
12 Mr Stephen Ronald Hobson
13 Brookman Resources Pty Ltd
14 Glover Superannuation Pty Ltd
15 Mr Cho Kheen Chong & Mrs Laura Ah Chun Chong
16 Mr Peter Joseph McGuire
17 Red Island Resources Ltd
18 BNP Paribas Nominees Pty Ltd
19 Mrs Lynette Rita Robinson
20 Neweconomy Com Au Nominees Pty Ltd
Total
Options Top 20 holders and percentage held
Holder Name
1 MICC LLC(ii)
2 Noble Resources International Pte Ltd
3 Mentok Pty Ltd
4 CS Third Nominees Pty Ltd
5 Melshare Nominees Pty Ltd
6 Swiftsure Investments Pty Ltd
7 HSBC Custody Nominees Australia Limited
8 Mr Graham Alan Canova
9 Mr Alexander Ross Passmore
10 Mr Antonino Gullotti
11 China Tonghai Securities Ltd
12 Custodial Services Limited
13 Sandwich Holdings Pty Ltd
14 Mr Paul Egryn Jones
15 Oro Resources Pty Ltd
16 Spectral Investments Pty Ltd
17 Mr Jody Alan Dennison
18 JOMOT Pty Ltd
19 Mr Ryan Low
20 Mr Daniel Aaron Hylton Tuckett
Total
Notes
(i)
(ii)
Held for and on behalf of Mr. Tserenpuntsag Tserendamba
Held for and on behalf of Mr. Tserenpuntsag Tserendamba: 153,330,119
Held for and on behalf of other MICC LLC clients: 17,000,000
Units
% of Issued
6. Stock exchange on which the Company’s securities are quoted:
The Company’s listed equity securities are quoted on the Australian Stock Exchange.
7. Restricted Securities
There are no restricted securities.
8. Review of Operations
9. Corporate Governance Statement
A review of operations is contained in the Annual Report and Directors’ Report within the Annual Financial Report.
The Corporate Governance Statement for the year ending 30 June 2019 can be found on the company’s website at
http://www.aspiremininglimited.com.
10. Schedule of Tenements Mining & Exploration Licenses
The licenses registered in the name of Aspire Mining Limited or its 100% owned subsidiaries are set out in the
Operational Review in the Annual Report.
11. Schedule of Tenements Mining & Exploration Licenses
The licenses registered in the name of the Company or one of its subsidiaries are:
Tenement
Ovoot
MV017098
Hurimt
14510X
Nuurstei
MV-020941
Location
Mongolia
Mongolia
Mongolia
Attributable Equity
100%
100%
90%
664,017,577
476,190,476
438,344,097
237,278,501
148,245,296
88,364,918
70,001,448
69,956,695
49,310,367
24,736,791
24,103,726
21,298,325
10,179,666
9,035,831
8,560,600
8,500,000
8,250,000
8,057,700
8,000,000
7,834,731
2,380,266,745
19.96%
14.31%
13.18%
7.13%
4.46%
2.66%
2.10%
2.10%
1.48%
0.74%
0.72%
0.64%
0.31%
0.27%
0.26%
0.26%
0.25%
0.24%
0.24%
0.24%
71.55%
Units
170,330,119
74,158,176
54,743,019
45,813,970
20,000,000
16,458,192
14,740,000
14,000,000
12,000,000
11,000,000
10,287,500
7,952,393
7,804,000
7,692,058
7,272,059
6,354,167
6,019,170
5,600,000
5,500,000
5,002,241
502,727,064
% of Issued
24.31%
10.58%
7.81%
6.54%
2.85%
2.35%
2.10%
2.00%
1.71%
1.57%
1.47%
1.13%
1.11%
1.10%
1.04%
0.91%
0.86%
0.80%
0.78%
0.71%
71.73%
ADDITIONAL SHAREHOLDER INFORMATION (continued)
ADDITIONAL SHAREHOLDER INFORMATION (continued)
- 59 -
- 60 -
Units
% of Issued
6. Stock exchange on which the Company’s securities are quoted:
The Company’s listed equity securities are quoted on the Australian Stock Exchange.
7. Restricted Securities
There are no restricted securities.
8. Review of Operations
A review of operations is contained in the Annual Report and Directors’ Report within the Annual Financial Report.
9. Corporate Governance Statement
The Corporate Governance Statement for the year ending 30 June 2019 can be found on the company’s website at
http://www.aspiremininglimited.com.
10. Schedule of Tenements Mining & Exploration Licenses
The licenses registered in the name of Aspire Mining Limited or its 100% owned subsidiaries are set out in the
Operational Review in the Annual Report.
11. Schedule of Tenements Mining & Exploration Licenses
The licenses registered in the name of the Company or one of its subsidiaries are:
2,380,266,745
71.55%
Units
% of Issued
170,330,119
24.31%
10.58%
Tenement
Ovoot
MV017098
Hurimt
14510X
Nuurstei
MV-020941
Location
Mongolia
Mongolia
Mongolia
Attributable Equity
100%
100%
90%
Ordinary Shares Top 20 holders and percentage held
Holder Name
1 Noble Resources International Pte Ltd
2 Mr Tserenpuntsag Tserendamba
3 MICC LLC(i)
4 Spectral Investments Pty Ltd
5 HSBC Custody Nominees Australia Limited
6 China Tonghai Securities Ltd
7 BNP Paribas Nominees Pty Ltd
8 Custodial Services Limited
9 J P Morgan Nominees Australia Pty Ltd
10 2R’s Pty Ltd
11 Citicorp Nominees Pty Ltd
12 Mr Stephen Ronald Hobson
13 Brookman Resources Pty Ltd
14 Glover Superannuation Pty Ltd
15 Mr Cho Kheen Chong & Mrs Laura Ah Chun Chong
16 Mr Peter Joseph McGuire
17 Red Island Resources Ltd
18 BNP Paribas Nominees Pty Ltd
19 Mrs Lynette Rita Robinson
20 Neweconomy Com Au Nominees Pty Ltd
Total
Options Top 20 holders and percentage held
Holder Name
1 MICC LLC(ii)
3 Mentok Pty Ltd
2 Noble Resources International Pte Ltd
4 CS Third Nominees Pty Ltd
5 Melshare Nominees Pty Ltd
6 Swiftsure Investments Pty Ltd
7 HSBC Custody Nominees Australia Limited
12 Custodial Services Limited
16 Spectral Investments Pty Ltd
8 Mr Graham Alan Canova
9 Mr Alexander Ross Passmore
10 Mr Antonino Gullotti
11 China Tonghai Securities Ltd
13 Sandwich Holdings Pty Ltd
14 Mr Paul Egryn Jones
15 Oro Resources Pty Ltd
17 Mr Jody Alan Dennison
18 JOMOT Pty Ltd
19 Mr Ryan Low
20 Mr Daniel Aaron Hylton Tuckett
Total
Notes
(i)
(ii)
Held for and on behalf of Mr. Tserenpuntsag Tserendamba
Held for and on behalf of Mr. Tserenpuntsag Tserendamba: 153,330,119
Held for and on behalf of other MICC LLC clients: 17,000,000
664,017,577
476,190,476
438,344,097
237,278,501
148,245,296
88,364,918
70,001,448
69,956,695
49,310,367
24,736,791
24,103,726
21,298,325
10,179,666
9,035,831
8,560,600
8,500,000
8,250,000
8,057,700
8,000,000
7,834,731
74,158,176
54,743,019
45,813,970
20,000,000
16,458,192
14,740,000
14,000,000
12,000,000
11,000,000
10,287,500
7,952,393
7,804,000
7,692,058
7,272,059
6,354,167
6,019,170
5,600,000
5,500,000
5,002,241
19.96%
14.31%
13.18%
7.13%
4.46%
2.66%
2.10%
2.10%
1.48%
0.74%
0.72%
0.64%
0.31%
0.27%
0.26%
0.26%
0.25%
0.24%
0.24%
0.24%
7.81%
6.54%
2.85%
2.35%
2.10%
2.00%
1.71%
1.57%
1.47%
1.13%
1.11%
1.10%
1.04%
0.91%
0.86%
0.80%
0.78%
0.71%
502,727,064
71.73%
aspiremininglimited.com