Athene Holding Ltd.
Annual Report 2023

Plain-text annual report

Athena Resources Limited ABN 69 113 758 900 ANNUAL FINANCIAL REPORT 30 JUNE 2023 CONTENTS Company information Directors’ Report Auditor’s Independence Declaration Statement of Comprehensive Income Statement of Financial Position Statement of Changes in Equity Statement of Cash Flows Notes to and Forming Part of the Financial Statements Directors’ Declaration Independent Auditor’s Report Shareholder Details Interest in Mining Tenements Corporate Governance Statement 3 4 22 23 24 25 26 27 46 47 51 54 54 Athena Resources Limited Page 2 COMPANY INFORMATION ABN Directors Company Secretary Registered Office Postal Address Share Registry Auditor Bankers 69 113 758 900 E W Edwards P J Newcomb H W Wai J D Swingler T P Weston P J Newcomb 21 Millstream Rise Hillarys, WA 6025 Managing Director Executive Director Non-executive Director Non-executive Director Non-executive Director Telephone: +61 448 895 664 Email:ahn@athenaresources.com.au 21 Millstream Rise Hillarys, WA 6025 Computershare Investor Services Pty Ltd Level 11, 172 St Georges Terrace Perth, WA 6000 Telephone: +61 8 9323 2000 HLB Mann Judd (WA Partnership) Level 4, 130 Stirling Street Perth, WA 6000 Telephone: +61 8 9227 7500 Westpac Banking Corporation 109 St Georges Terrace Perth, WA 6000 Securities Exchange Listing Athena Resources Limited shares are listed on the Australian Securities Exchange (Home Exchange – Perth) ASX Code: AHN Website www.athenaresources.com.au Athena Resources Limited Page 3 DIRECTORS’ REPORT AND CONTROLLED ENTITIES DIRECTORS’ REPORT Your Directors submit their report on the consolidated entity consisting of Athena Resources Limited (“Athena” or “the Company”) and its controlled entities (“Group”) for the financial year ended 30 June 2023. REVIEW OF OPERATIONS Exploration and Evaluation Athena Resources Limited (ASX: AHN) (“Athena” or the “Company”) is pleased to report on the Company’s activities for the year ended 30 June 2023. Athena’s work over the past 12 months has principally been resource development, with the focus on the Company’s 100% owned Byro Magnetite Project. Drilling at the start of the period resulted in a re-evaluation and revision of the Mineral Resource Estimate (“MRE”) at the Byro Project’s Fe1 Target resulting in an upgraded resource. These results formed the basis of a Project Study which commenced in early 2023. Also, during the period, the Company evaluated and revised the base metal targets at the Byro Project, resulting in the planning of further exploration programs, scheduled for execution in late 2023. BYRO MAGNETITE PROJECT The Byro Magnetite Project consists of primary target Fe1, along with the satellite targets Byro South, Whitmarsh Find, Whistlejack, and Mt Narryer. During the reporting year, work focussed primarily on Fe1. The company announced on 27 July 2022 that drilling had been completed. This included 1,037.5m of reverse program circulation (“RC”) drilling, and 1,305.3m of HQ diameter diamond core drilling. The drill program showed mineralisation extending beyond 2011 Inferred Mineral Resource limits. Following whole rock assay results, Davis Tube Recovery (“DTR”) analysis of composite samples was undertaken with results demonstrative of the projects ability to produce a consistently high purity magnetite concentrate. Significant intersections of DTR composite assays are tabulated below: Athena Resources Limited Page 4 Figure 1 Project location DIRECTORS’ REPORT AND CONTROLLED ENTITIES Table 1 Fe1 2022 drilling program significant DTR results Hole ID AHRC0111D AHRC0112D AHRC0113D AHRC0114D AHRC0115D Easting (m) MGA94z50 431100 Northing (m) MGA94z50 7110036 430950 430950 4311000 431050 7110036 7109970 7109970 7109970 RL (m) AHD 349 349 348.5 349 349 Intercept metres 103.6 59.6 39.2 79 124.27 From metres 91.3 152.4 166 105 62 Fe % DTR 70.9 71.3 70.5 70.8 70.6 In late 2022, Entech Mining Consultancy Pty Ltd (“Entech”) were commissioned to update the Mineral Resource Estimate to include the recent RC and diamond drilling results. On 17 January 2023, the Company announced the updated MRE reported to Joint Ore Reserve Committee (“JORC”) 2012 standard. Table 2 Byro Whole Rock Mineral Resource within mineralised domains (10% Fe cut-off) Mineral Resource Category Indicated Inferred TOTAL Weathered Tonnes Fresh Fresh (Mt) 24 5.3 29.3 Fe (%) SiO2 (%) Al2O3 (%) P (%) S (%) 25.1 22.7 24.7 49.3 50.6 49.6 5.48 6.56 5.68 0.052 0.048 0.051 0.079 0.085 0.08 TiO2 (%) 0.32 0.37 0.33 LOI (%) Density -0.059 0.023 -0.044 3.27 3.21 3.26 Table 3 Byro Magnetite Mineral Resource within mineralised domains (20% DTR cut-off) Mineral Resource Category Indicated Inferred TOTAL Weathered Tonnes Fresh Fresh (Mt) 17.7 3.3 21 DTR (%) 33.6 32.3 33.4 Fe (%) SiO2 (%) Al2O3 (%) P (%) S(%) LOI (%) Density 70.7 70.8 70.7 1.23 0.95 1.18 0.32 0.34 0.32 0.003 0.002 0.003 0.021 0.023 0.021 -3.2 -3.17 -3.19 3.3 3.26 3.29 The updated MRE resulted in a 24% increase in tonnes of contained iron with DTR results maintaining a grade sufficient for high value specialised steel (including green steel), and other high value industrial applications. Athena Resources Limited Page 5 DIRECTORS’ REPORT AND CONTROLLED ENTITIES Pre-Feasibility / Scoping Study Figure 2 Drilling at Fe1 2022. In late 2022, Athena announced the commencement of a Pre-Feasibility Study for the Byro Magnetite Project. Central to this Project Study is the Indicated Mineral Resource at Fe1. As part of this investigation, a number of companies and consultancies have been engaged. Athena Resources Limited Page 6 DIRECTORS’ REPORT AND CONTROLLED ENTITIES Figure 3 HQ diamond core showing matrix magnetite mineralisation. GR Engineering Services Limited (“GRES”) were commissioned to update the previously estimated capital and operational costs associated with the construction and operation of a 5Mt/annum processing facility proposed for the project. GRES were initially engaged to in 2011 to carry out cost estimates and an operating flowsheet, which has largely been retained with some modification and improvement. ALS Metallurgy’s Iron Ore Technical Centre (“IOTC”) completed Wet Low Intensity Magnetic Separation (Wet LIMS) test-work yielding highly encouraging results. IOTC prepared bulk samples for larger scale simulation to test wet LIMS used within the processing plant design. The comparison of bulk LIMS against previous LIMS and the large DTR dataset provided a clear understanding of the LIMS separation will be. This also allows for a more a practical understanding of actual mass reporting to various stages of the concentrate grinding process, or waste to tailings. Athena Resources Limited Page 7 DIRECTORS’ REPORT AND CONTROLLED ENTITIES The Flow diagram below shows the crucial stages of LIMS processing and the significance of its effectiveness. Figure 4 Wet LIMS circuits within the simplified process flow sheet. Mining consultancy Entech Pty Ltd (“Entech”) were commissioned to review the recent drilling at Fe1 and provide geotechnical input for the Pre-Feasibility Study. The geotechnical assessment evaluated the potential for slope instabilities and derives slope optimisation and design parameter recommendations for the proposed open pit mining of Fe1 Magnetite deposit. The study included collation and validation of geotechnical and structural logging, and analysis. Also, rock mass characterisation, and summary of rock mass statistics by type and domain, along with structural discontinuity characterisation, and summary statistics by defect set and domain. Further this study developed a geotechnical model for analysis of special variability in rock mass. This study has been completed and a draft report is presently under review. Entech were also commissioned to carry out preliminary pit optimisation work in conjunction with the geotechnical study. This work is also presently under review with further work to be commissioned regarding actual pit design, and a bench scale preliminary mining schedule. Mt Magnet Drilling Pty Ltd were engaged to carry out resource development drilling at the Byro South Prospect to increase the Project’s resource inventory. Initially, this program was delayed due to the passing of an ex tropical cyclone and significant local flooding. This program has now been re-scheduled and is likely to commence during late August 2023. Athena Resources Limited Page 8 MILLINGTERTIARY CRUSHINGMAGNETIC SEPARATION(LIMS)GREEN STEEL FEEDSTOCKSIZINGSIZINGSCREENINGSCREENINGSCREENINGPrimarySecondaryTertiaryCobberRougherCleanerFinal ConcentrateThickeningFiltration and Water RecyclingThickeningFiltration and Water RecyclingRejectedTailingsDIRECTORS’ REPORT AND CONTROLLED ENTITIES Figure 5 Project location, Western Yilgarn Ni-Cu-PGE Province BYRO BASE METALS PROJECT The Company carried out a comprehensive review of the base metal targets at the Byro Project. The Byro Project is situated in the highly prospective Narryer Terrane, which forms the northernmost part of the West Yilgarn Ni-Cu-PGE Province. This highly prospective 1,200km corridor hosts numerous prospects and projects, the most notable being the Gonneville (Julimar) discovery by Chalice Mining Ltd with an MRE of 16Moz 3E (Pd, Pt, Au), 860kt Ni, 520kt Cu, 83kt Co. The Gonneville discovery has resulted in multiple companies securing tenure and exploring for mafic/ultramafic intrusion hosted mineralisation along the western margin of the Yilgarn Craton. Athena Resources Limited Page 9 Youanmi TerraneEasternGoldfieldsTerraneSouthwest TerraneNarryerTerraneWestern Yilgarn Ni-Cu-PGE ProvincePerthJulimarByro Magnetite and Base Metals Project0200kmYILGARN CRATONDIRECTORS’ REPORT AND CONTROLLED ENTITIES Milly Milly Intrusion Athena has been exploring within the Narryer Terrane and through geophysical surveys, drilling, and sampling, has identified extensive mafic and ultramafic intrusive units within the project tenements. The primary base metal targets occur at the Milly Milly Intrusion, a large peridotite intrusion, which hosts disseminated nickel-copper sulphide, elevated PGE’s, with 2021 RC drilling identifying high grade graphite mineralisation. Historic drilling, by Athena, includes the below intersections: AHDH00162.7m @ 0.29% Ni from 149.7m AHRC002536m @ 0.34% Ni from 0m (ASX: AHN Announcement 10/09/2010) Graphite intersections include: AHRC0096 3m @ 4.83% TGC from 102m, including 1m @ 13.02% TGC from 103m, AHRC00963m @ 3.13% TGC from 107m, including 1m @ 5.28% TGC from 108m, (ASX: AHN Announcement 9/03/2023) Moonborough Intrusion The extensive Moonborough Intrusion is part of a broader series of mafic/ultramafic intrusion underlying significant portions of several of the project tenements. Historic work by the Company has identified elevated PGE soil anomalies, significant rock chip samples with elevated copper and PGE’s, with a 2021 RC drilling campaign returning the following significant intersections: Table 4 Moonborough significant copper intersections Hole ID Easting (m) Northing (m) MGA94z50 MGA94z50 AHRC0100 415684 7117164 RL (m) AHD 328 including AHRC0101 415793 7117271 including AHRC0106 415922 7117179 326 324 Table 5 Moonborough significant PGE intersections Hole ID Easting (m) Northing (m) MGA94z50 MGA94z50 AHRC0100 415684 7117164 RL (m) AHD 328 including AHRC0101 415793 7117271 including AHRC0106 415922 7117179 326 324 From (m) 0 20 10 55 0 From (m) 0 0 46 55 0 Cu (ppm) 104.6 371 65 121.5 95.36 3PGE (ppb) To (m) 40 23 81 75 14 To (m) 96 33 81 64 18 Interval (m) 40 3 71 20 14 Interval (m) 96 33 35 9 18 Revision of these programs concludes that more extensive work is required to develop an improved understanding of the intrusion’s extent and internal morphology, and to develop primary base metal and PGE targets. Campaigns of extensive geochemical soil sampling are currently in development with execution scheduled for late 2023. This program includes Byro South tenement E09/1781, along with the Milly Milly tenement E09/1637. Athena Resources Limited Page 10 DIRECTORS’ REPORT AND CONTROLLED ENTITIES Figure 4 Byro Project magnetite Prospects and tenure. Detailed results of activities and discussion thereon are contained in our Quarterly Activities Reports which are available on our website www.athenaresources.com.au. Athena Resources Limited Page 11 60014426016508kmE09/1507-IE09/1552-IE09/1637-IE09/1637-IE09/1507-IE09/1781-IE09/1507-IM09/166-IFe1Byro SouthWhistlejackWhitmarsh FindDIRECTORS’ REPORT AND CONTROLLED ENTITIES As announced to ASX on 20 December 2022, the Mining Warden has recommended against the granting of partial exemption from the expenditure requirements for 2020 in respect of exploration licences E09/1507 and E09/1552. The Minister has yet to decide whether to grant or refuse the applications. Should the application be refused, the Minister has the discretion to do nothing, apply a fine of up to $10,000 per tenement or forfeit the tenements. The Company has applied for a judicial review of the Warden’s decision relating to the exemption application. The Judicial Review has now been listed for hearing before a Judge in the Supreme Court on 24 August 2023. The Company retains current tenure whilst the above process is taking place. Announcements relevant to the activities for the year are as follows: 28/07/2022 16/11/2022 28/11/2022 17/01/2023 21/03/2023 23/03/2023 29/03/2023 07/06/2023 13/06/2023 19/06/2023 Corporate Completion of Drilling for Mineral Resource Estimation Assay Results from Infill Drilling for Indicated MRE Further Assay results from Infill Drilling for Indicated MRE MRE - upgraded JORC classification and increased tonnes Byro Magnetite Project - Prefeasibility Study Update Byro Magnetite Project Update Byro Fe1 Mineral Resource Estimate Full Entech Report Investor Presentation Byro Base Metal Project Presentation Pre Feasibility Study Update Metallurgy Management and Board During the year Peter Newcomb was appointed Executive Director and Company Secretary and Ed Edwards became Managing Director. Dates of all appointments and resignations are shown in a later section of this Directors’ Report. In March 2023 Martin Dormer joined the management team as Head of Geology. On 4 May 2023 the Company received a notice under section 249D of the Corporations Act to requisition a meeting of shareholders to consider resolutions to gain control of the company by changing the composition of the Board. The Notice was from Adroit Capital Investments Pty Ltd (and others) who had purchased shares ten days prior to the notice date to enable this action. Adroit had not been a shareholder prior to that date. On 22 May 2023 the Company issued a Notice of General Meeting to be held on 28 June 2023 to consider the proposed changes. At the Meeting the proposed resolutions were defeated by 468 million votes to 189 million votes. At the date of this report Adroit is no longer a shareholder. Athena Resources Limited Page 12 DIRECTORS’ REPORT Share Capital and Options During the year the Company completed the following Capital Raisings: Month Type Shares Options* Price Raising AND CONTROLLED ENTITIES Placement October 2022 December 2022 NRRI January 2023 January 2023 Shortfall Placement 57,500,000 - - 200,000,000 257,500,000 - 163,832,940 126,323,913 200,000,000 490,156,853 $0.010 $0.002 $0.002 $0.010 $575,000 $327,666 $252,648 $2,000,000 $3,155,314 * Options with an exercise price of $0.018 expiring 20 October 2025 Further details of Contributed Equity and Options, including costs of raising, are in Notes 13 and 14. Directors in Office 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: Name Office Appointed Resigned Edmond William Edwards Peter John Newcomb Hau Wan Wai Jeffrey David Swingler Terence Paul Weston Managing Director Executive Director Non-executive Director Non-executive Director Non-executive Director 23-09-2022 01-07-2023 01-07-2023 David Colin Wheeler Giuseppe Paolo Graziano Clinton Stash Moxham Non-executive Director Non-executive Director Non-executive Director 30-06-2021 31-05-2022 01-08-2022 30-09-2022 01-08-2022 30-09-2022 Particulars of Directors Edmond William Edwards Managing Director Qualifications Mr Edwards is a member of Chartered Accountants Australia and New Zealand (CAANZ), with a Bachelor of Commerce from the University of Western Australia. Experience Mr Edwards has over 45 years of experience in the mining industry in Western Australia. Ed retired as a partner in Sir Charles Court’s professional practice Hendry Rae and Court in 1989, where he was principally audit partner for Cliffs Robe River Iron Associates. He has previously been Executive Director or Finance Director of a number of listed mining and exploration companies having taken many of these companies through the initial public offering, then exploration, feasibility and finally into production or production startup. Athena Resources Limited Page 13 DIRECTORS’ REPORT These projects included the Nimary Gold Mine, Radio Hill base metals and Koolan Island iron ore. AND CONTROLLED ENTITIES Interest in Shares 69,378,831 Fully Paid Shares Special Responsibilities Mr Edwards is responsible for the day to day running of the Company with an emphasis on financial and tenement management. Directorships held in listed entities In the 3 years immediately before the end of the financial year Mr Edwards did not serve as a director of any other listed companies. Peter John Newcomb Executive Director and Company Secretary Qualifications Mr Newcomb is a former Fellow of the Institute of Chartered Accountants in England and Wales and a member of Chartered Accountants Australia and New Zealand. Experience Mr Newcomb has over 45 years professional and commercial experience working in a number of industries and locations including London, Scotland, Singapore and Perth. Qualified as a Chartered Accountant in the UK, Peter joined Hendry, Rae and Court 1980, where he became audit manager for Cliffs Robe River Iron Associates (CRRIA) amongst other clients. During his time on the CRRIA audit he was also responsible for the development of computer based audit systems and programs, and performed a number of non-audit consulting roles for the client. He was later employed by his other main accounting and audit client UK based Oceonics Group, and was shortly after relocated to Singapore to manage the group’s equipment technology and supply group Seatronics in South East Asia before taking up a Group Finance Director position in Aberdeen with responsibility for all international bases. After a further 8 years in London in the Pharmaceutical industry he returned home to Perth and established his consultancy Symbios Pty Ltd specialising in IT solutions for management and accounting, together with Company Secretarial services. The majority of his experience over the last 25 years has been in the Resources industry predominantly in Western Australia. Interest in Shares 58,263,042 Fully Paid Shares 30,000,000 Listed Options Special Responsibilities Company Secretarial functions, financial reporting, financial modelling, information systems and general administration. Athena Resources Limited Page 14 DIRECTORS’ REPORT Directorships held in listed entities In the 3 years immediately before the end of the financial year Mr Newcomb did not serve as a director of any other listed companies. AND CONTROLLED ENTITIES Hau Wan Wai Qualifications Non-executive Director BA The University of Regina Canada, Major in Marketing. Experience Mr Wai speaks Mandarin, Cantonese and English. He was born and resides in Hong Kong. Mr Wai is also an executive director of Brilliant Glory Industrial Corporation Ltd, the Hong Kong company which is the 100% parent of major shareholder Brilliant Glory Investments Pty Ltd. He has over 30 years of international trade and relations experience having started his career as a merchandiser. He specialises in management of overseas customers to locate the sourcing of materials for mainland China in many different fields, and especially in Mineral resources. He introduced the Company to Xinhai Mining Research and Design Company and accompanied a team of mining and engineering personal to Byro to inspect the project. Xinhai produced a detailed engineering study in 2018. Interest in Shares 49,250,000 Fully Paid Shares Special Responsibilities Mr Wai is responsible for the promotion of the company, and discussions with potential partners in Hong Kong, China and the Far East. Directorships held in listed entities In the 3 years immediately before the end of the financial year Mr Wai did not serve as a director of any other listed companies. Jeffrey David Swingler Non-executive Director (Appointed 1 July 2023) Qualifications Mr Swingler has a Bachelor of Business from RMIT and a Masters of Entrepreneurship and Innovation from Swinburne University. Experience Jeff is a businessman with a background as a Chartered Accountant and Banker, his exposure to mining commencing with Shell’s ownership of Gold (Boddington) and Coal assets in the 80’s before Upstream and Downstream Oil & Gas. His accounting career progressed into a technology, systems and infrastructure focus during nine years with Visy Industries, seeding various technologies, developing strategy and building new paper mills and box plants in Australia and the USA. His interest in energy developed through R&D and implementation Athena Resources Limited Page 15 DIRECTORS’ REPORT AND CONTROLLED ENTITIES of energy cogeneration, recycling, biofuels and markets. Visy sponsored Jeff’s participation in CSIRO’s Business Higher Education Round Table Leadership program which gave him exposure to a range of advanced developments. Appointed a Director of ANZ Securities, ANZ Corporate Finance and other ANZ businesses across the Investment Bank in the late 90’s, Jeff was involved in overseeing the floats of various companies and refinancing including Ashton Mining, and the break up of the SECV, before being appointed Global Head of Equity Risk for ANZ. Jeff has spent the last 25 years working across corporate innovation, technology business startups, garnering financing from angels and Venture Capital through to Institutional Investors. He was appointed Australia’s Senior Investment Specialist for Energy and Resources (Austrade) in 2014 working across the spectrum of projects including Adani, Iron Road and others as well as LNG developments such as Inpex along with Renewable energy developments, kick starting the Federal Government’s commercial support for Critical Materials and Rare Earths. Jeff was the Federal Government’s representative to the Cooper Basin Gas Roundtable. More recently Jeff has advised Australian Strategic Materials polymetallic rare earth activities and Scandium International’s nickel cobalt and scandium project, whilst also introducing them both to Defence, Automotive and Aerospace participants internationally. Interest in Shares None Special Responsibilities Mr Swingler is responsible for identification of innovative high margin markets, shareholder engagement and mid term strategy Directorships held in listed entities In the 3 years immediately before the end of the financial year Mr Swingler did not serve as a director of any other listed companies. Terrence Paul Weston Non-executive Director (Appointed 1 July 2023) Qualifications Mr Weston holds the Degree of Bachelor of Applied Science (Metallurgy) from University of Melbourne. He is a Member of the Australasian Institute of Mining and Metallurgy. Experience Terence is a metallurgist with 30 years’ experience as a consultant in the mining industry. After graduation from University of Melbourne in 1973 he joined Peko-Wallsend (later North Mining) working as Production Metallurgist at the gold/copper operation at Mt Morgan, Queensland, in 1976 transferring to the Scheelite mine on King Island achieving the position of Deputy Manager/Metallurgical Superintendent. In 1989 Terry transferred to North Mining’s office in Perth to oversee North’s gold operations in W.A. and assist in the design and construction of the Kanowna Belle gold mine. After twenty years working for North Mining, he ventured out as an independent Metallurgical Consultant and during the next thirty years consulted to both big and small mining companies. These included Athena Resources Limited Page 16 DIRECTORS’ REPORT AND CONTROLLED ENTITIES Harmony Gold Australia (Jubilee Gold operation) Harmony Gold PNG Services (Hidden Valley Gold project), Newcrest Mining (O’Callaghan’s Tungsten project), Athena Resources Limited (Byro Magnetite project), Savannah Nickel Mines (Nickel/Copper/Colbalt operation), Gold Road Resources (Gruyere Gold operation) and Doray Minerals (Andy Well Gold operation) to mention a few. Terry’s expertise includes, gold, copper/gold, nickel/copper/colbalt, iron ore, tungsten, mineral sands, tantalum/tin, lithium and uranium. He specialises in taking a project from exploration, laboratory testwork (design of test program and review), process design and construction to operation/production. During the last thirty years he has acted on numerous occasions as client representative working with engineering companies to bring projects to production. Interest in Shares 14,000,000 Fully Paid Shares 6,000,000 Listed Options Special Responsibilities Mr Weston is responsible for developing laboratory test programs, review of testwork results through to optimisation of process design and planned construction, together with providing a cost effective treatment process for the Byro magnetite project, including process mass balance calculations plus review of individual items of capital for the processing plant. Directorships held in listed entities In the 3 years immediately before the end of the financial year Mr Weston did not serve as a director of any other listed companies. PRINCIPAL ACTIVITIES The principal activity of the Group during the year was mineral exploration in Australia. OPERATING AND FINANCIAL REVIEW Review of Operations A review of operations of the Group during the financial year is contained in the Review of Operations section at the start of the Directors’ Report. 2023 $ 2022 $ Consolidated loss after income tax for the financial year 680,980 547,720 Financial Position At 30 June 2023 the Company has cash reserves of $1,436,016. Dividends No dividends were paid during the year and no recommendation is made as to dividends. SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS In the opinion of the Directors, there were no significant changes in the state of affairs of the Group that occurred during the financial year under review not otherwise disclosed in this report or in the consolidated accounts. Athena Resources Limited Page 17 DIRECTORS’ REPORT AND CONTROLLED ENTITIES MATTERS SUBSEQUENT TO THE END OF FINANCIAL YEAR Except as stated in Note 26, since the end of the financial year under review and the date of this report, there has not arisen any matter, transaction or event of a material and unusual nature likely, in the opinion of the directors of the Company, to significantly affect the operations of the consolidated entity, in the current or subsequent financial years. LIKELY DEVELOPMENTS AND EXPECTED RESULTS The Company intends to continue its exploration activities with a view to the commencement of mining operations as soon as possible. Further information on likely developments in the operations of the Group and the expected results of operations have not been included in this report because the Directors believe it would be likely to result in unreasonable prejudice to the Company. MEETINGS OF DIRECTORS The following table sets out the number of meetings of the Company’s Directors held during the year ended 30 June 2023, and the number of meetings attended by each Director. These meetings included matters relating to the Remuneration and Nomination Committees of the Company. Edmond William Edwards Peter John Newcomb Hau Wan Wai Number eligible to attend 10 8 10 Number attended 10 8 10 The Company also attended to other Board business via several circular resolutions of the Board. AUDIT COMMITTEE The audit committee was comprised of Executive director Mr E Edwards. During the year ended 30 June 2023, Mr Edwards held two meetings of the Audit Committee. REMUNERATION REPORT (AUDITED) This report details the nature and amount of remuneration for each member of the key management personnel of Athena Resources Limited. The following persons acted as directors during or since the end of the financial year: Edmond William Edwards Peter John Newcomb Hau Wan Wai Jeffrey David Swingler Terence Paul Weston Managing Director Executive Director Non-executive Director Non-executive Director Non-executive Director Resigned Appointed 11/04/2005 23/09/2022 29/12/2017 01/07/2023 01/07/2023 David Colin Wheeler Giuseppe Paolo Graziano Clinton Stash Moxham Non-executive Director Non-executive Director Non-executive Director 30/06/2021 31/05/2022 01/08/2022 30/09/2022 01/08/2022 30/09/2022 Athena Resources Limited Page 18 DIRECTORS’ REPORT AND CONTROLLED ENTITIES The Company has no other key management personnel. The information provided in the remuneration report includes remuneration disclosures that are required under Accounting Standards AASB 124 “Related Party Disclosures”. These disclosures have been transferred from the financial report and have been audited. Remuneration policy The board policy is to remunerate directors at market rates for time, commitment and responsibilities. The board determines payment to the directors and reviews their remuneration annually, based on market practice, duties and accountability. Independent external advice is sought when required. The maximum aggregate amount of directors’ fees that can be paid is subject to approval by shareholders in general meeting, from time to time. Fees for non-executive directors are not linked to the performance of the consolidated entity. However, to align directors’ interests with shareholder interests, the directors are encouraged to hold securities in the company. The company’s aim is to remunerate at a level that will attract and retain high-calibre directors and employees. Company officers and directors are remunerated to a level consistent with the size of the company. All remuneration paid to directors and executives is valued at the cost to the company and expensed. Performance-based remuneration The Company does not pay any performance-based component of remuneration. Directors’ Remuneration No salaries, commissions, bonuses or superannuation were paid or payable to directors during the year. Remuneration was by way of fees (as detailed below) paid monthly in respect of invoices issued to the Company by the Directors or Companies associated with the Directors in accordance with agreements between the Company and those entities. No other short-term or long-term benefits were provided during the current or prior year. Details of the agreements are set out below. Agreements in respect of cash remuneration of Directors Director Ed Edwards Peter Newcomb Hau Wan Wai Jeff Swingler Terry Weston Position Managing Director Executive Director Non-exec Director Non-exec Director Non-exec Director Monthly Fee $15,000 $5,000 $5,000 $5,000 $5,000 Note (1) (2) (3) (1) Personal related entity Tied Investments Pty Ltd has an agreement with the Company to provide corporate management services. Either party may terminate by giving six months' notice. Fees for work conducted outside the scope of this Directorship are charged at commercial rates. (2) Personal related entity Symbios Pty Ltd has an agreement with the Company to provide administrative and Co Sec services. Either party may terminate by giving six months' notice. Fees for work conducted outside the scope of this Directorship are charged at commercial rates. (3) Personal related entity The Weston Family Trust has an agreement with the Company to provide technical services. Either party may terminate by giving three months' notice. Fees for work conducted outside the scope of this Directorship are charged at commercial rates. The Directors are entitled to reimbursement of out-of-pocket expenses incurred whilst on Company business. The total remuneration paid to directors is summarised below: Athena Resources Limited Page 19 DIRECTORS’ REPORT Year ended 30 June 2023 Director Associated Company E W Edwards P J Newcomb H W Wai Tied Investments Pty Ltd Symbios Pty Ltd D C Wheeler G P Graziano C S Moxham Pathways Corporate Pathways Corporate Mine Operations Exchange Pty Ltd Year ended 30 June 2022 Director Associated Company E W Edwards H W Wai Tied Investments Pty Ltd D C Wheeler G P Graziano F R Knezovic Pathways Corporate Pathways Corporate Nova Legal AND CONTROLLED ENTITIES Fees $ Consultancy $ Total $ 150,000 37,000 48,000 12,000 4,000 8,000 259,000 - 140,123 - - - - 140,123 150,000 177,123 48,000 12,000 4,000 8,000 399,123 Fees $ Consultancy $ Total $ 120,000 - 48,000 4,000 44,000 216,000 - - - - - - 120,000 - 48,000 4,000 44,000 216,000 At 30 June 2023 there was $29,500 payable to Directors and their personally related entities. There were no performance related payments, option or share based payments, superannuation payments or other benefits made during the year. Directors’ Shareholdings in the Company Director E W Edwards Hau Wan Wai P J Newcomb D C Wheeler G P Graziano Balance 1 July 2022 Balance on appointment Acquired during the year At date of resignation Balance 30 June 2023 69,378,831 49,250,000 - 6,250,000 6,250,000 131,128,831 - - 50,025,000 - - 50,025,000 - - 6,975,000 - - 6,975,000 - - - (6,250,000) (6,250,000) (12,500,000) 69,378,831 49,250,000 57,000,000 - - 175,628,831 The shareholding disclosed for Hau Wan Wai is held in Brilliant Glory Investments Pty Ltd of which Hau Wan Wai is a Director. Athena Resources Limited Page 20 DIRECTORS’ REPORT AND CONTROLLED ENTITIES The Company received no specific feedback on its Remuneration Report at the 2022 Annual General Meeting. End of Remuneration Report SHARE OPTIONS As at the date of this report, there were 75,000,000 Unlisted options over unissued ordinary shares in the parent entity. The options are exercisable at 2c per share and expire on 15 February 2026. As at the date of this report, there were 582,656,853 Listed options over unissued ordinary shares in the parent entity. The options are exercisable at 1.8c per share and expire on 20 October 2025. ENVIRONMENTAL ISSUES The Group has conducted exploration activities on mineral tenements. The right to conduct these activities is granted subject to environmental conditions and requirements. The group aims to ensure a high standard of environmental care is achieved and, as a minimum, to comply with relevant environmental regulations. There have been no known breaches of any of the environmental conditions. INDEMNIFICATION OF DIRECTORS During the financial year, the Company has given an indemnity or entered into an agreement to indemnity as follows: The Company has entered into an agreement with Mr E Edwards to indemnify him against any liability incurred by him as an officer of the Company including costs and expenses of any successfully defended legal proceedings. AUDITOR HLB Mann Judd continues in office in accordance with section 327 of the Corporations Act 2001. AUDITOR’S INDEPENDENCE DECLARATION The auditor’s independence declaration as set out on page 22 has been received for the year ended 30 June 2023 and forms part of this directors’ report. PROCEEDINGS ON BEHALF OF COMPANY No person has applied for leave of Court to bring proceedings on behalf of the Company or 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 any part of those proceedings. The Company was not a party to any such proceedings during the year. Signed in accordance with a resolution of the directors. ............................................................... E W EDWARDS Managing Director Dated at Perth this 31st day of July, 2023. Athena Resources Limited Page 21 AUDITOR’S INDEPENDENCE DECLARATION As lead auditor for the audit of the consolidated financial report of Athena Resources Limited for the year ended 30 June 2023, 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 31 July 2023 M R Ohm Partner STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 30 JUNE 2023 PROFIT & LOSS Expenses Directors’ remuneration Salaries and employee costs Legal and professional Office and communication Listing and share registry Financial expenses Depreciation Other expenses AND CONTROLLED ENTITIES Note Consolidated 2023 $ 2022 $ 270,000 245,718 200,193 13,546 66,488 44,094 48 106,643 6 244,000 227,337 144,568 11,304 51,375 41,540 - 68,996 Total Expenses 946,730 789,120 Recoveries to capitalised exploration 7 (265,750) (241,400) Expenses net of recoveries 680,980 547,720 Other income - - LOSS BEFORE INCOME TAX BENEFIT 680,980 547,720 Income tax benefit 3 - - NET LOSS FOR THE YEAR 680,980 547,720 Other comprehensive income - - TOTAL COMPREHENSIVE LOSS FOR THE YEAR 680,980 547,720 Basic loss per share (cents per share) 24 0.073 0.072 These financial statements should be read in conjunction with the accompanying notes. Athena Resources Limited Page 23 STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2023 BALANCE SHEET CURRENT ASSETS Cash and cash equivalents Trade and other receivables Total Current Assets NON-CURRENT ASSETS AND CONTROLLED ENTITIES Note Consolidated 2023 $ 2022 $ 4 5 1,436,016 132,877 663,311 232,913 1,568,893 896,224 Plant and equipment Mineral exploration and evaluation 6 7 1,714 12,168,588 - 10,965,438 Total Non-Current Assets 12,170,302 10,965,438 TOTAL ASSETS CURRENT LIABILITIES Trade creditors and accruals Annual leave payable Other liabilities Long service leave provision 13,739,195 11,861,662 8 9 10 195,734 36,955 22,734 62,408 62,120 34,187 424,855 - Total Current Liabilities 317,831 521,162 NON-CURRENT LIABILITIES Long service leave provision Total Non-Current Liabilities TOTAL LIABILITIES NET ASSETS EQUITY Contributed equity Reserves Accumulated losses TOTAL EQUITY - - 56,001 56,001 317,831 577,163 13,421,364 11,284,499 13 14 12 21,154,196 943,414 (8,676,246) 13,421,364 18,956,665 323,100 (7,995,266) 11,284,499 These financial statements should be read in conjunction with the accompanying notes. Athena Resources Limited Page 24 STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 30 JUNE 2023 AND CONTROLLED ENTITIES EQUITY Consolidated Issued Capital $ Reserves $ Accumulated Losses $ Total $ Year ended 30 June 2022 Balance at 1 July 2021 Issue of shares Issue costs – cash based Issue costs – fair value of options Comprehensive loss for the year Balance at 30 June 2022 16,543,107 3,048,270 (319,112) (315,600) - 18,956,665 Year ended 30 June 2023 Balance at 1 July 2022 Issue of shares Issue costs – cash based Issue costs – fair value of options Comprehensive loss for the year Balance at 30 June 2023 18,956,665 2,575,000 (377,469) - - 21,154,196 - 7,500 - 315,600 - 323,100 323,100 620,314 - 943,414 (7,447,546) - - (547,720) (7,995,266) 9,095,561 3,055,770 (319,112) - (547,720) 11,284,499 (7,995,266) - - - (680,980) (8,676,246) 11,284,499 3,195,314 (377,469) - (680,980) 13,421,364 These financial statements should be read in conjunction with the accompanying notes. Athena Resources Limited Page 25 STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 30 JUNE 2023 CASH FLOW AND CONTROLLED ENTITIES Note Consolidated 2023 $ 2022 $ CASH FLOWS FROM OPERATING ACTIVITIES Payments to suppliers (643,917) (816,324) Net Cash (Outflow) from Operating Activities 15 (643,917) (816,324) CASH FLOWS FROM INVESTING ACTIVITIES Purchase of fixed assets Payments for mineral exploration and evaluation (1,763) (1,399,460) - (1,347,054) Net Cash (Outflow) From Investing Activities (1,401,223) (1,347,054) CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from issue of shares Repayments of borrowings from related parties Share issue transaction costs 3,155,314 - (337,469) 3,055,770 (40,000) (319,112) Net Cash Inflow from Financing Activities 2,817,845 2,696,658 Net increase in cash held 772,705 533,280 Cash and cash equivalents at beginning of the financial year 663,311 130,031 Cash and cash equivalents at the end of the financial year 4 1,436,016 663,311 These financial statements should be read in conjunction with the accompanying notes. Athena Resources Limited Page 26 NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 AND CONTROLLED ENTITIES NOTE 1 - STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES Statement of Compliance These consolidated financial statements are general purpose financial statements prepared in accordance with the requirements of the Corporations Act 2001 including Accounting Interpretations and other authoritative pronouncements of the Australian Accounting Standards Board (‘AASB’) and applicable accounting standards. The accounting policies and methods of computation adopted are consistent with those of the previous financial year except for the impact of the new standards and interpretations effective 1 July 2022 disclosed below. These accounting policies are consistent with Australian Accounting Standards and with International Financial Reporting Standards. The financial statements were authorised for issue on 31 July 2023. The financial statements comply 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 Reporting Standards (IFRS). Basis of Preparation This report has been prepared on a historical cost basis. Cost is based on the fair value of the consideration given in exchange for assets. The company is domiciled in Australia and all amounts are presented in Australian dollars, unless otherwise noted. Reporting Basis and Conventions (Going Concern) The financial report has been prepared on the basis of accounting principles applicable to a going concern, which assumes the commercial realisation of the future potential of Athena’s assets and the discharge of its liabilities in the normal course of business. The Board considers that Athena is a going concern and recognises that additional funding is required to ensure that it can continue to fund its operations and further develop its mineral exploration and evaluation assets during the twelve-month period from the date of approval of this financial report. The Company has access to the following potential sources of funding: • The placement of securities under the ASX Listing Rule 7.1 or otherwise; • An excluded offer pursuant to the Corporations Act 2001; • The sale of assets; or • Deferral of creditors payments Should such funding not be received, or not received on a sufficiently timely basis, there would be a material uncertainty which may cast significant doubt as to the Group’s ability to continue as a going concern and realise its assets and extinguish its liabilities in the ordinary course of business, and at the amounts stated in the financial report. Athena Resources Limited Page 27 NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 AND CONTROLLED ENTITIES Significant accounting judgements and key estimates The preparation of financial reports requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expense. Actual results may differ from these estimates. In preparing this annual report, the significant judgements made by management in applying the Group’s accounting policies and the key sources of estimation uncertainty were the same as those that applied to the consolidated financial report for the year ended 30 June 2022. As announced to ASX on 20 December 2022, the Mining Warden has recommended against the granting of partial exemption from the expenditure requirements for 2020 in respect of exploration licences E09/1507 and E09/1552. The Minister has yet to decide whether to grant or refuse the applications. Should the application be refused, the Minister has the discretion to do nothing, apply a fine of up to $10,000 per tenement or forfeit the tenements. The Company has applied for a judicial review of the Warden’s decision relating to the exemption application. The Judicial Review has now been listed for hearing before a Judge in the Supreme Court on 24 August 2023. The Company retains current tenure whilst the above process is taking place. Adoption of New and Revised Standards In the year ended 30 June 2023, the directors have reviewed all of the new and revised Standards and Interpretations issued by the AASB that are relevant to the Group’s operations and effective for annual reporting periods beginning on or after 1 July 2022. It has been determined by the directors that there is no impact, material or otherwise, of the new and revised standards and interpretations on the Group’s business and therefore, no change is necessary to Group accounting policies. The directors have also reviewed all new Standards and Interpretations that have been issued but are not yet effective for the year ended 30 June 2023. As a result of this review the directors have determined that there is no impact, material or otherwise, of the new and revised Standards and Interpretations on the Group’s business and, therefore, no change necessary to Group accounting policies. Segment Reporting Operating segments are reported in a manner that is consistent with the internal reporting provided to the chief operating decision maker. The chief operating decision maker has been identified as the Board of Athena Resources Limited. Accounting Policies Principles of Consolidation A controlled entity is any entity controlled by Athena Resources Limited. Control exists where Athena Resources Limited has the capacity to dominate the decision making in relation to the financial and operating policies of another entity so that the other entity operates with Athena Resources Limited to achieve the objectives of Athena Resources Limited. All controlled entities have a 30 June financial year-end. Athena Resources Limited Page 28 NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 AND CONTROLLED ENTITIES All intercompany balances and transactions between entities in the consolidated entity, including any unrealised profit or losses, have been eliminated on consolidation. Accounting policies of subsidiaries have been changed where necessary to ensure consistencies with those policies applied by the parent entity. Where controlled entities have entered or left the Group during the year, their operating results have been included from the date control was obtained or until the date control ceased. Income Tax The charge for current income tax expenses is based on the profit for the year adjusted for any non-assessable or disallowable items. It is calculated using tax rates that have been enacted or are substantively enacted by the balance date. Deferred tax is accounted for in respect of temporary differences arising between the tax bases of assets and liabilities and their carrying amount in the financial statements. No deferred income tax will be recognised from the initial recognition of an asset or liability, excluding a business combination, where there is no effect on accounting or taxable profit or loss. Deferred tax is calculated at the tax rates that are expected to apply to the period when the asset is realised, or liability is settled. Deferred tax is credited in the statement of comprehensive income except where it relates to items that may be credited directly to equity, in which case the deferred tax is adjusted directly against equity. Deferred income tax assets are recognised to the extent that it is probable that future tax profits will be available against which deductible temporary differences can be utilised. The amount of benefits brought to account or which may be realised in the future is based on the assumption that no adverse change will occur in income taxation legislation and the anticipation that the Group will derive sufficient future assessable income to enable the benefit to be realised and comply with the conditions of deductibility imposed by the law. Plant and Equipment Plant and equipment are measured on the cost basis less accumulated depreciation and accumulated impairment losses. The carrying amount of plant and equipment is reviewed annually by Directors to ensure it is not in excess of the recoverable amount from these assets. The recoverable amount is assessed on the basis of the expected net cash flows which will be received from the asset’s employment and subsequent disposal. The expected net cash flows have been discounted to their present values in determining recoverable amounts. Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future consolidated benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. All other repairs and maintenance are charged to the statement of comprehensive income during the financial period in which they are incurred. Depreciation The depreciable amount of all fixed assets including capitalised lease assets, but excluding computers, is depreciated on a reducing balance commencing from the time the asset is held ready Athena Resources Limited Page 29 NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 AND CONTROLLED ENTITIES for use. Computers are depreciated on a straight-line basis over their useful lives to the consolidated entity commencing from the time the asset is held ready for use. The depreciation rates used for each class of depreciable assets are: Class of Fixed Asset Plant and Equipment Depreciation Rate 33% The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each balance date. An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount. Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These gains and losses are included in the statement of comprehensive income. When revalued assets are sold, amounts included in the revaluation reserve relating to that asset are transferred to accumulated losses. Mineral Exploration and Evaluation Expenditure Exploration and evaluation expenditure incurred is either written off as incurred or accumulated in respect of each identifiable area of interest. Tenement acquisition costs are initially capitalised. Costs are only carried forward to the extent that they are expected to be recouped through the successful development of the areas, sale of the respective areas of interest or where activities in the area have not yet reached a stage, which permits reasonable assessment of the existence of economically recoverable reserves. Accumulated costs in relation to an abandoned area are written off in full in the year in which the decision to abandon the areas is made. When production commences, the accumulated costs for the relevant area of interest are amortised over the life of the area according to the rate of depletion of the economically recoverable reserves. A regular review is undertaken of each area of interest to determine the appropriateness of continuing to carry forward costs in relation to that area of interest. Restoration, rehabilitation and environmental costs necessitated by exploration and evaluation activities are expensed as incurred and treated as exploration and evaluation expenditure. Impairment of Assets At each reporting date, the Directors review the carrying values of its tangible and intangible assets to determine whether there is any indication that those assets have been impaired. If such an indication exists, the recoverable amount of the assets, being the higher of the asset’s fair value less costs to sell and value in use, is compared to the asset’s carrying value. Any excess of the asset’s carrying value over its recoverable amount is expensed to the statement of comprehensive income. Where it is not possible to estimate the recoverable amount of an individual asset, the Group estimates the recoverable amount of the cash-generating unit to which the asset belongs. Athena Resources Limited Page 30 NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 AND CONTROLLED ENTITIES Provisions Provisions are recognised where there is a legal or constructive obligation, as a result of past events, for which it is probable that an outflow of economic benefits will result, and that outflow can be reliably measured. Cash and Cash Equivalents Cash and cash equivalents include cash on hand, deposits held at call with banks and other short- term highly liquid investments with original maturities of three months or less. Revenue Interest revenue is recognised on a proportional basis taking into account the interest rates applicable to the financial assets. All revenue is stated net of the amount of goods and service tax (GST). Share-based Payments The cost of equity-settled transactions are measured at fair value on grant date. Fair value is independently determined using either the Binomial or Black-Scholes option pricing model that takes into account the exercise price, the term of the option, the impact of dilution, the share price at grant date and expected price volatility of the underlying share, the expected dividend yield and the risk free interest rate for the term of the option, together with non-vesting conditions that do not determine whether the consolidated entity receives the services that entitle the employees to receive payment. No account is taken of any other vesting conditions. Goods and Services Tax (GST) Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from the Australian Tax Office. In these circumstances the GST is recognised as part of the cost of acquisition of the asset or as part of an item of the expenses. Receivables and payables in the statement of financial position are shown inclusive of GST. Issued Capital Issued and paid up capital is recognised at the fair value of the consideration received by the company. Any transaction costs arising on the issue of ordinary shares are recognised directly in equity as a reduction of the share proceeds received. Comparative Figures When required by Accounting Standards, comparative figures have been adjusted to conform to changes in presentation for the current financial year. Impairment of Exploration Expenditure The Directors assess impairment at each reporting date by evaluating conditions specific to the Group that may lead to impairment of exploration expenditure. In making this assessment, the Directors have considered the existence of any possible indicators of impairment per AASB 6 “Exploration for and Evaluation of Mineral Resources”. On the basis of this review, the Directors have not written off any exploration expenditure during the financial year and are satisfied that no impairment is present at 30 June 2023. Athena Resources Limited Page 31 NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 AND CONTROLLED ENTITIES Critical Accounting Estimates and Judgements The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts in the financial statements. Management continually evaluates its judgements and estimates in relation to assets, liabilities, contingent liabilities, revenue and expenses. Management bases its judgements, estimates and assumptions on historical experience and on other various factors, including expectations of future events, management believes to be reasonable under the circumstances. The resulting accounting judgements and estimates will seldom equal the related actual results. The judgements, estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities (refer to the respective notes) within the next financial year are discussed below. 1) Exploration and evaluation costs Exploration and evaluation costs have been capitalised on the basis that the consolidated entity will commence commercial production in the future, from which time the costs will be amortised in proportion to the depletion of the mineral resources. Key judgements are applied in considering costs to be capitalised which includes determining expenditures directly related to these activities and allocating overheads between those that are expensed and capitalised. In addition, costs are only capitalised that are expected to be recovered either through successful development or sale of the relevant mining interest. Factors that could impact the future commercial production at the mine include the level of reserves and resources, future technology changes, which could impact the cost of mining, future legal changes and changes in commodity prices. To the extent that capitalised costs are determined not to be recoverable in the future, they will be written off in the period in which this determination is made. 2) Share-based payment transactions The consolidated entity 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 either the Binomial or Black-Scholes model taking into account the terms and conditions upon which the instruments were granted. The accounting estimates and assumptions relating to equity-settled share-based payments would have no impact on the carrying amounts of assets and liabilities within the next annual reporting period but may impact profit or loss and equity. Athena Resources Limited Page 32 NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 AND CONTROLLED ENTITIES NOTE 2 - LOSS FROM ORDINARY ACTIVITIES BEFORE TAX EXPENSE Expenses Depreciation of non-current assets: Plant and equipment Total depreciation of non-current assets NOTE 3 - INCOME TAX Consolidated 2023 $ 2022 $ 48 48 - - No income tax is payable by Athena as each entity in the Group incurred a loss for tax purposes for the year and each has available recoupable income tax losses at balance date. The aggregate of income tax attributable to the financial year differs from the amount calculated on the operating loss. The differences are calculated as follows: Tax Losses for the year Loss for the year Income tax credit calculated at 25% (2022 25%) Deferred tax asset not recognised Income Tax Attributable to Operating Loss Accumulated Tax Losses Loss for the year Disallowable expenses Timing differences on depreciation of assets Exploration expenditure Provisions movement Section 40-880 deduction Tax loss for the year Tax losses brought forward Current year loss Tax losses carried forward Consolidated 2023 $ 2022 $ 680,980 547,720 170,245 (170,245) - 136,930 (136,930) - $ $ 680,980 547,720 (4,642) 1,714 (2,506) 2,142 1,203,150 409,950 1,718,200 (418,171) 233,327 2,524,479 157,832 2,005,217 16,358,511 2,524,479 18,882,990 14,353,294 2,005,217 16,358,511 Athena Resources Limited Page 33 NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 INCOME TAX - continued Section 40-880 AND CONTROLLED ENTITIES Consolidated 2023 2022 Balance brought forward Share Issue costs per Statement of Financial Position (Note 13) Fair value of options issued (Note 13) Claim for the year Balance carried forward – available for claim in future years 588,692 377,469 - (233,327) 732,834 111,812 319,112 315,600 (157,832) 588,692 The potential deferred tax asset has not been brought to account in the financial report at 30 June 2023 as the Directors do not believe it is appropriate to regard the realisation of the asset as probable. This asset will only be obtained if: (a) The Company and its controlled entities derive future assessable income of an amount and type sufficient to enable the benefit from the deductions for the tax losses and the unrecouped exploration expenditure to be realised; (b) The Company and its controlled entities continue to comply with the conditions for deductibility imposed by tax legislation; and (c) No changes in tax legislation adversely affect the company and its controlled entities in realising the benefit from the deductions for the tax losses and unrecouped exploration expenditure. Franking Credits No franking credits are available at balance date for the subsequent financial year. NOTE 4 - CASH AND CASH EQUIVALENTS Cash at bank and on hand Consolidated 2023 $ 1,436,016 1,436,016 2022 $ 663,311 663,311 Athena Resources Limited Page 34 NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 NOTE 5 - TRADE AND OTHER RECEIVABLES Current Other Debtors Prepaid Tenement Rent Progress payments GST Receivable NOTE 6 - PLANT AND EQUIPMENT AND CONTROLLED ENTITIES 747 94,565 - 37,565 132,877 - 60,290 150,000 22,623 232,913 Year ended 30 June 2022 Balance at 1 July 2020 Additions Disposals Depreciation Charge Balance at 30 June 2022 Year ended 30 June 2023 Balance at 1 July 2022 Additions Disposals Depreciation Charge Balance at 30 June 2023 Cost $ Accumulated Depreciation $ Net Book Value $ 71,356 - - - 71,356 71,356 1,762 - - 73,118 (71,356) - - - (71,356) (71,356) - - (48) (71,404) - - - - - - 1,762 - (48) 1,714 NOTE 7 - MINERAL EXPLORATION AND EVALUATION Exploration and evaluation phase: Consolidated 2023 $ 2022 $ Balance at 1 July 2022 10,965,438 9,247,238 Expenditure during the year on external costs and services Overheads recovered through timesheet allocations 937,400 265,750 1,476,800 241,400 Balance at 30 June 2023 12,168,588 10,965,438 The recoupment of costs carried forward in relation to areas of interest in the exploration and evaluation phase is dependent on the successful development and commercial exploitation or sale of the respective areas. Athena Resources Limited Page 35 NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 NOTE 8 - TRADE CREDITORS AND ACCRUALS Current Accounts payable NOTE 9 - OTHER LIABILITIES Accrued overhead expenses Accrued exploration expenses Days in lieu Employee deductions and entitlements AND CONTROLLED ENTITIES 195,734 195,734 62,120 62,120 7,000 - 731 15,003 22,734 - 376,000 26,937 21,918 424,855 NOTE 10 - LONG SERVICE LEAVE PROVISION Due to a resignation effective 14 July 2023 the Long Service Leave provision has been re-classified to current liabilities. NOTE 11 - RELATED PARTY LOANS There have been no related party loan movements during the current year and no balances outstanding at 30 June 2023. NOTE 12 - ACCUMULATED LOSSES Balance at beginning of the year Net Loss for the year Balance at end of the year Consolidated 2023 $ (7,995,266) (680,980) (8,676,246) 2022 $ (7,447,546) (547,720) (7,995,266) Athena Resources Limited Page 36 NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 NOTE 13 - CONTRIBUTED EQUITY Issued Capital Balance at beginning of year Issued during the year for cash Share issue costs – cash based Share issue costs – fair value of options Balance at end of year Issued Capital AND CONTROLLED ENTITIES 2023 $ 2022 $ 18,956,665 2,575,000 (377,469) - 21,154,196 16,543,107 3,048,270 (319,112) (315,600) 18,956,665 Shares 2023 Shares 2022 Balance at beginning of year Issued during the year for cash under 1:1 Rights Issue Issued during the year for cash under Placements Issued during the year with shareholder approval Balance at end of year 812,967,558 - 257,500,000 - 1,070,467,558 361,033,779 361,033,779 20,000,000 70,900,000 812,967,558 Ordinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the company in proportion to the number of and amounts paid on the shares held. The fully paid ordinary shares have no par value and the company does not have a limited amount of authorised capital. On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each share shall have one vote. Athena Resources Limited Page 37 NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 NOTE 14 - RESERVES Share Options Issued and fully paid AND CONTROLLED ENTITIES Consolidated 30 June 2023 $ 30 June 2022 $ 943,414 323,100 Movements in reserves of the Company were as follows: Year to 30 June 2022 Number $ At 1 July 2021 Share based payment transactions Options issued At 30 June 2022 Year to 30 June 2023 At 1 July 2022 NRRI free attaching options Lead manager options NRRI options issue NRRI Option shortfall Free attaching options at nil value Lead manager options at 0.1c per option At 30 June 2023 - - 75,000,000 75,000,000 75,000,000 57,500,000 5,000,000 163,832,940 126,323,913 200,000,000 30,000,000 657,656,853 - 315,600 7,500 323,100 323,100 - 10,000 327,666 252,648 - 30,000 943,414 The share-based payment reserve is used to recognise difference between the amount paid for options and the fair value on grant date. Fair value was independently determined using the Black-Scholes option pricing model that took into account the exercise price, the term of the option, the share price at grant date and expected price volatility of the underlying share. Listed options were issued to Peak Asset Management for services relating to their role as lead managers. These were valued at the listed price of the options on grant date. Athena Resources Limited Page 38 NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 NOTE 15 - STATEMENT OF CASH FLOWS Reconciliation of loss after income tax to net operating cash flows AND CONTROLLED ENTITIES Consolidated 2023 $ 2022 $ Loss from ordinary activities 680,980 547,720 Depreciation (48) - Movement in assets and liabilities Receivables and prepayments Payables and provisions Net cash used in operating activities (134,310) 97,295 643,917 6,228 262,376 816,324 NOTE 16 - FINANCIAL INSTRUMENTS The Directors have assessed that the carrying value of financial assets and financial liabilities approximate their fair value at balance date. NOTE 17 - COMMITMENTS FOR EXPENDITURE Mineral Tenement Leases In order to maintain current rights of tenure to mining tenements, the Group will be required to outlay amounts of $3,257,000 (2022: $3,257,000) in respect of minimum tenement expenditure requirements and lease rentals. The obligations are not provided for in the financial report and are payable as follows: Not later than one year Later than 1 year but not later than 2 years Later than 2 years but not later than 5 years Consolidated 2023 $ 651,400 651,400 1,954,200 3,257,000 2022 $ 651,400 651,400 1,954,200 3,257,000 The Company has a number of avenues available to continue the funding of its current exploration program and as and when decisions are made, the Company will disclose this information to shareholders. NOTE 18 - CONTINGENT LIABILITIES Athena Resources Limited and its controlled entities have no known material contingent liabilities as at 30 June 2023. Athena Resources Limited Page 39 NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 AND CONTROLLED ENTITIES NOTE 19 - INVESTMENT IN CONTROLLED ENTITIES Class of Shares Book Value of Athena’s Investments Complex Exploration Pty Ltd Capricorn Resources Pty Ltd Byro Exploration Pty Ltd Ordinary Ordinary Ordinary 100% 100% 100% 2023 $ 100 200 1,390,000 1,390,300 2022 $ 100 200 1,390,000 1,390,300 The above controlled entities are incorporated in Australia. The book value of Athena Resources Limited’s investment in the ordinary shares of controlled entities is at cost, which does not exceed the underlying net assets of each entity. Byro Exploration Pty Ltd is a wholly owned subsidiary of Complex Exploration Pty Ltd. NOTE 20 - SEGMENT INFORMATION During the year the Group operated principally in one business segment being mineral exploration within Australia. NOTE 21 - KEY MANAGEMENT PERSONNEL (a) Directors The names and positions of Directors in office at any time during the financial year are: Edmond William Edwards Peter John Newcomb Hau Wan Wai David Colin Wheeler Clinton Stash Moxham Managing Director Executive Director Non-executive Director Non-executive Director Non-executive Director Giuseppe Paolo Graziano Non-executive Director Appointed 23 September 2022 Resigned 30 September 2022 Appointed 1 August 2022 Resigned 30 September 2022 Resigned 1 August 2022 (b) Remuneration Polices Remuneration policies are disclosed in the Remuneration Report which is contained in the Directors’ Report. Athena Resources Limited Page 40 NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 (c) The total remuneration paid to Directors is summarised below: Year ended 30 June Short-term employee benefits Post-employment benefits Other-long term benefits AND CONTROLLED ENTITIES Consolidated 2023 $ 399,123 - - 399,123 2022 $ 216,000 - - 216,000 At 30 June there was $29,500 payable to Directors and their personally related entities. NOTE 22 - RELATED PARTY INFORMATION Transactions within the Group Non-current receivables – Controlled Entities Less: Provision for non-recovery Parent Entity 2023 $ 2022 $ 13,724,073 (1,554,985) 12,169,088 12,520,923 (1,554,985) 10,965,938 Note 27 NOTE 23 - REMUNERATION OF AUDITORS Amount received, or due and receivable, by the auditors for: Auditing and reviewing of the consolidated financial statements Other services – Independent Limited Assurance Report Consolidated 2023 $ 41,455 - 41,455 2022 $ 23,823 7,575 31,398 Audit fees are included in Legal and Professional expenses in the Statement of Comprehensive Income. Athena Resources Limited Page 41 NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 NOTE 24 - LOSS PER SHARE AND CONTROLLED ENTITIES Consolidated 2023 $ 2022 $ Loss used in the calculation of loss per share 680,980 547,720 Weighted average number of ordinary shares outstanding during the year 934,206,003 758,234,951 Basic loss per share (cents per share) 0.073 0.072 NOTE 25 - FINANCIAL RISK MANAGEMENT Financial Risk Management Policies The Group’s financial instruments consist mainly of deposits with banks, accounts receivable and accounts payable. The Board’s overall risk management strategy seeks to assist the group in meeting its financial targets, whilst minimising potential adverse effects on financial performance. The Group has developed a framework for a risk management policy and internal compliance and control systems that covers the organisational, financial and operational aspects of the Group’s affairs. The Chairman is responsible for ensuring the maintenance of, and compliance with, appropriate systems. Financial Risk Exposures and Management The main risks the Group is exposed to through its financial instruments are interest rate risk and liquidity risk. Athena Resources Limited Page 42 NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 AND CONTROLLED ENTITIES Interest Rate Risk The Group’s exposure to interest rate risk, which is the risk that a financial instrument’s value will fluctuate as a result of change in the market, interest rate and the effective weighted average interest rate on these financial assets, is as follows: Financial Assets - Cash at bank - Trade debtors Total Financial Assets Financial Liabilities - Trade Creditors - Accruals - Related Party Loans Total Financial Liabilities Non-Interest Bearing Floating Interest Rate 2023 $ 1,436,016 132,877 1,568,893 195,734 122,097 317,831 2022 $ 663,311 232,913 896,224 62,120 515,043 - 577,163 2023 $ 2022 $ - - - - - - - - - - - - - - Weighted Average Effective Interest Rate is 0% (2022: 0.1%) Liquidity Risk The Group manages liquidity risk by monitoring forecast cash flows. Credit Risk The maximum exposure to credit risk, excluding the value of any collateral or other security, at balance date, is the carrying amount net of any allowance for doubtful debts, as disclosed in the statement of financial position and notes forming part of the financial statements. In the case of cash deposited, credit risk is minimised by depositing with recognised financial intermediaries such as banks, subject to Australian Prudential Regulation Authority supervision. The Group does not have any material risk exposure to any single debtor or group of debtors under financial instruments entered into by it. Capital Management Risk Management controls the capital of the Group in order to maximise the return to shareholders and ensure that the Group can fund its operations and continue as a going concern. Management effectively manages the consolidated entity’s capital by assessing the Group’s financial risks and adjusting its capital structure in response to changes in these risks and in the market. These responses include the management of expenditure and debt levels and share and option issues. There have been no changes in the strategy adopted by management to control capital of the Group since the prior year. Athena Resources Limited Page 43 NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 AND CONTROLLED ENTITIES Financial Instruments Net Fair Values For financial assets and liabilities, the net fair value approximates their carrying value. The Group has no financial assets or liabilities that are readily traded on organised markets at balance date and has no financial assets where the carrying amount exceeds net fair values at balance date. The aggregate net fair values and carrying amounts of financial assets and financial liabilities are disclosed in the statement of financial position and in the notes to and forming part of the financial statements. Interest Rate Sensitivity Analysis The Group does not have a material exposure to interest rate risk. NOTE 26 - EVENTS SUBSEQUENT TO BALANCE DATE On 1 July 2023 Jeffrey David Swingler and Terence Paul Weston were appointed Non-executive Directors. No other matters or circumstances have arisen since the end of the financial year that have significantly affected, or may significantly affect, the operations of the Group, the results of these operations or the state of affairs of the Group, in the current or subsequent financial years. Athena Resources Limited Page 44 NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2023 NOTE 27 - PARENT ENTITY DISCLOSURES Note 22 Financial Position CURRENT ASSETS Cash and cash equivalents Trade and other receivables Total Current Assets NON-CURRENT ASSETS Plant and equipment Investment in subsidiaries Loans to subsidiaries Total Non-Current assets TOTAL ASSETS CURRENT LIABILITIES Trade and other payables Total Current Liabilities NON-CURRENT LIABILITIES Long service leave provision TOTAL LIABILITIES NET ASSETS EQUITY Issued capital Accumulated losses TOTAL EQUITY Financial Performance (Loss) for the year Other comprehensive income Total comprehensive (loss) AND CONTROLLED ENTITIES 2023 $ 1,435,216 132,877 1,568,093 1,714 300 12,169,088 12,171,102 2022 $ 662,511 232,913 895,424 - 300 10,965,938 10,966,238 13,739,195 11,861,662 317,831 317,831 521,162 521,162 - 56,001 317,831 577,163 13,421,364 11,284,499 22,097,610 (8,676,246) 19,279,765 (7,995,266) 13,421,364 11,284,499 (680,980) (680,980) (547,720) - (547,720) The parent entity has not entered into any guarantees in relation to debts of its subsidiaries, has no contingent liabilities, and has no commitments for acquisition of property, plant and equipment. The ultimate recovery of the loans to the subsidiaries is dependent on the successful development and/or commercial exploitation or sale of the subsidiaries’ exploration assets. Athena Resources Limited Page 45 DIRECTORS’ DECLARATION FOR THE YEAR ENDED 30 JUNE 2023 AND CONTROLLED ENTITIES 1. In the opinion of the directors of Athena Resources Limited (‘the Company’): a) the accompanying financial statements and notes are in accordance with the Corporations Act 2001 including: (i) (ii) b) c) giving a true and fair view of the Group’s financial position as at 30 June 2023 and of its performance for the year then ended; and complying with Australian Accounting Standards, the Corporations Regulations 2001, professional reporting requirements and other mandatory requirements. 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 thereto are in accordance with International Financial Reporting Standards issued by the International Accounting Standards Board. 2. 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 2023. _______________________________ E W Edwards Managing Director Dated at Perth this 31st day of July 2023 Athena Resources Limited Page 46 INDEPENDENT AUDITOR’S REPORT To the Members of Athena Resources Limited Report on the Audit of the Financial Report Opinion We have audited the financial report of Athena Resources Limited (“the Company”) and its controlled entities (“the Group”), which comprises the consolidated statement of financial position as at 30 June 2023, the consolidated statement of 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 2023 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 (including Independence Standards) (“the Code”) that are relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Material Uncertainty Related to Going Concern We draw attention to Note 1 in the financial report, which indicates that a material uncertainty exists that may cast significant doubt on the Group’s ability to continue as a going concern. Our opinion is not modified in respect of this matter. Key Audit Matters Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial report of the current period. These matters were addressed in the context of our audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. In addition to the matter described in the Material Uncertainty Related to Going Concern section, we have determined the matters described below to be the key audit matters to be communicated in our report. Key Audit Matter How our audit addressed the key audit matter Mineral exploration and evaluation Refer to Note 7 The Group has a capitalised mineral exploration and evaluation balance of $12,168,588 as at 30 June 2023. In accordance with AASB 6 Exploration for and Evaluation of Mineral Resources, the Group capitalises evaluation exploration expenditure as incurred. and We considered this to be a key audit matter due to its materiality, the degree of audit effort and communication with management necessary and its importance for the users’ understanding of the financial statements. Our procedures included but were not limited to: - Obtaining evidence that the Group has current rights to tenure of its areas of interest; - Substantiating a sample of exploration and evaluation expenditure; - Considering the Directors’ assessment of potential indicators of impairment under AASB 6 Exploration for and Evaluation of Mineral Resources in addition to making our own assessment; - Examining the exploration budget and discussing with management the nature of planned ongoing activities; and - Assessing the appropriateness of the disclosures included in the relevant notes to 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 2023, but does not include the financial report and our auditor’s report thereon. Our opinion on the financial report does not cover the other information and 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. 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. − 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, actions taken to eliminate threats or safeguards applied. 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. 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 2023. In our opinion, the Remuneration Report of Athena Resources Limited for the year ended 30 June 2023 complies with Section 300A of the Corporations Act 2001. Responsibilities The directors of the Company are responsible for the preparation and presentation of the Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards. HLB Mann Judd Chartered Accountants Perth, Western Australia 31 July 2023 M R Ohm Partner SHAREHOLDER DETAILS FOR THE YEAR ENDED 30 JUNE 2023 ANALYSIS OF SHAREHOLDING – 14 JULY 2023 1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001 – 500,000 500,001 – or more Total on issue AND CONTROLLED ENTITIES Holders SHARES 35 49 62 389 318 250 4,991 141,637 533,065 19,549,619 82,109,513 968,128,733 1,070,467,558 433 shareholders, with a total of 10,927,107 shares, hold less than marketable parcel of $500. Voting Rights Article 16 of the Constitution specifies that on a show of hands every member present in person, by attorney or by proxy shall have: (a) for every fully paid share held by him one vote. (b) for every share which is not fully paid a fraction of the vote equal to the amount paid up on the share over the nominal value of the shares. Substantial Shareholders The following substantial shareholders have notified the Company in accordance with Corporations Act 2001. Goldway Mega Trade Limited Edmond William Edwards Peter Andrew Nelson Peter John Newcomb Alister Murdock MacDonald Brilliant Glory Investments Pty Ltd Directors’ Shareholding 72,082,857 69,378,831 65,197,459 58,263,042 58,000,000 49,250,000 Interest of each director in the share capital of the Company is detailed in the Remuneration Report. Athena Resources Limited Page 51 SHAREHOLDER DETAILS FOR THE YEAR ENDED 30 JUNE 2023 AND CONTROLLED ENTITIES TOP TWENTY SHAREHOLDERS 28 JULY 2023 Shareholder Shares % Rank Goldway Mega Trade Limited Mr Peter Andrew Nelson Tied Nominees Pty Ltd Stonydeep Investments Pty Ltd Brilliant Glory Investments Pty Ltd Technical Ceramic Marketing Services Pty Ltd Mr David Webster Ms Natasha Baker Mr James Gregory Puklowski Cobpen Co Investments Pty Ltd Mr Terence Paul Weston 10 Bolivianos Pty Ltd Mr Harold Gordon Shore Kelanco Pty Ltd Mr Alister Macdonald + Mrs Lidia Saez Macdonald Citicorp Nominees Pty Limited BNP Paribas Nominees Pty Limited Twin Oaks Super Pty Ltd Mr Constantine Differding + Mrs Tonie Differding BNP Paribas Noms Pty Ltd Total 72,082,857 65,197,459 58,298,138 58,263,042 49,250,000 44,000,000 18,750,000 17,461,111 15,900,000 15,096,626 14,000,000 12,666,386 12,395,749 12,100,000 12,000,000 10,799,647 10,791,042 10,000,000 9,500,000 8,702,668 527,254,725 6.73 6.09 5.45 5.27 4.60 4.11 1.75 1.63 1.49 1.41 1.31 1.18 1.16 1.13 1.12 1.00 1.00 0.93 0.89 0.81 49.28 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 TOP TWENTY UNLISTED OPTIONHOLDERS 28 JULY 2023 Optionholder Options % Rank Celtic Capital Pty Ltd CPS Capital No 5 Pty Ltd Plutus Ventures Pty Ltd Mr David Peter Valentino Mr Brent Joseph Evitt Mercury Anetac Capital Pty Ltd Phi Group Pty Ltd Princeton Capital (WA) Pty Ltd Honeybee Anhm Pty Ltd Mr Mason King Total 39,482,724 22,499,997 5,331,573 4,102,381 716,665 716,665 716,665 716,665 537,499 179,166 75,000,000 52.64 30.00 7.11 5.47 0.96 0.96 0.96 0.96 0.72 0.24 100.00 1 2 3 4 5 6 7 8 9 10 Athena Resources Limited Page 52 SHAREHOLDER DETAILS FOR THE YEAR ENDED 30 JUNE 2023 AND CONTROLLED ENTITIES TOP TWENTY LISTED OPTIONHOLDERS 28 JULY 2023 Optionholder Options % Rank Technical Ceramic Marketing Services Pty Ltd Stonydeep Investments Pty Ltd Mr Lemuel Cherloaba Adroit Capital Investments Pty Ltd Goffacan Pty Ltd Ms Chunyan Niu Twin Oaks Super Pty Ltd Mr Darryl Gregor Abotomey Mr Andrew John Puklowski Tornado Nominees Pty Ltd BNP Paribas Nominees Pty Ltd Lennox Investments Pty Ltd Mr Shane Timothy Ball Mr Conor Daley Anzus Software Solutions Pty Ltd Mr Scott Arthur Cluff Mr Constantine Differding + Mrs Tonie Differding Mr Ching Hsiung Tseng Matthew Burford Super Fund Pty Ltd Tornado Nominees Pty Ltd 40,000,000 30,000,000 30,000,000 30,000,000 22,000,000 19,087,838 18,000,000 17,800,000 16,000,000 15,000,000 14,768,655 12,800,000 12,676,670 12,500,000 10,000,000 10,000,000 9,500,000 9,500,000 9,000,000 8,700,000 347,333,163 6.87 5.15 5.15 5.15 3.78 3.28 3.09 3.05 2.75 2.57 2.53 2.20 2.18 2.15 1.72 1.72 1.63 1.63 1.54 1.49 59.61 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Athena Resources Limited Page 53 INTEREST IN MINING TENEMENTS FOR THE YEAR ENDED 30 JUNE 2023 AND CONTROLLED ENTITIES INTEREST IN MINING TENEMENTS Athena Resources Limited 100% Tenement Type Applications pending Byro Project Exploration E09/1507 – see Note below E09/1552 – see Note below E09/1637 E09/1781 E09/1938 Byro Project Mining M09/166 M09/168 Byro Project Water E – Exploration License Exemption 592781 Forfeiture 592786 Exemption 592782 Forfeiture 592787 M – Mining Lease L09/112 L – Miscellaneous Licence Note on applications pending Exploration Licences E09/1507 and E09/1552 did not meet minimum expenditure requirements in the year ending October 2020 and applications for exemption were made to the Mines Department. The exemption applications were objected to by Alexander Creek (a wholly owned subsidiary of Buxton Resources) on the same day, and shortly thereafter applications for forfeiture were lodged by Alexander Creek. In the case of a forfeiture, the applicant has first rights to the tenement. Buxton Resources had previously been given access to both the ground and to Athena’s data, under a Confidentiality Agreement, and were aware of a potential shortfall in expenditure for that year. The current status of the exemption applications, and the potential implications of this are discussed in the announcement made to ASX on 13 June 2023. ASX Announcement Update on Status of Exemption Applications CORPORATE GOVERNANCE STATEMENT The Board of Directors of Athena Resources Limited is responsible for the corporate governance of the Company. The Board guides and monitors the business and affairs of Athena Resources Limited on behalf of the shareholders by whom they are elected and to whom they are accountable. The statement reports on Athena Resources Limited’s key governance principles and practices. Details of the Corporate Governance Statement can be found on the Athena Resources Limited’s website at: www.athenaresources.com.au/corporate/corporate-governance/ Athena Resources Limited Page 54 

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