Aura Energy Limited
(ACN 115 927 681)
Annual Report
Year 30 June 2019
Corporate Directory
Directors
PD Reeve
R Beeson
BF Fraser
JC Perkins
Executive Chairman
Non-Executive Director
Non-Executive Director
Non-Executive Director
Company Secretary
JM Madden
Registered office
Level 1, 34-36 Punt Road
Windsor Victoria Australia 3181
Telephone
Facsimile
61 3 9516 6500
61-3-9516 6565
Website
www.auraenergy.com.au
Share registry
Computershare Investor Services Pty Ltd
Level 2, Reserve Bank Building
45 St Georges Terrace
Perth WA Australia 6000
Telephone
Facsimile
1300 557 010
61-8-9323 2033
Nominated Advisor
SP Angel Corporate Finance LLP
35 Maddox Street
Mayfair London United Kingdom
Joint brokers
SP Angel Corporate Finance LLP
WH Ireland Limited
Auditor
Bentleys
Level 3, London House
216 St Georges Terrace
Perth WA Australia
Solicitors
Dentons Australia
Level 17, 585 Collins Street
Melbourne Victoria Australia
Chairman’s letter
Review of operations
Directors’ report
Remuneration report
Auditor’s independence statement
Consolidated statement of profit or loss
and other comprehensive income
Consolidated statement of financial position
Consolidated statement of changes in equity
Consolidated statement of cash flows
Notes to the financial statements
Directors’ declaration
Independent auditor’s report
Additional information as required by Australian Securities Exchange
CONTENTS
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26
70
71
77
Page 1
CHAIRMAN’S LETTER
Dear Shareholder
During 2019 Aura continued to advance its philosophy that the best path to creating shareholder
wealth is the advancement towards, and ultimately the achievement of, production from its
exploration and development projects.
With the Tiris Uranium Project, the Häggån Vanadium Project and our exploration tenements for gold,
base and battery metals Aura pursued this strongly and concluded the end of 2018/19 with the
business side of the company in great shape.
Whilst the financial year was one of outstanding success from a business building point of view the
response on the equity market for Aura was poor and at year end the lack of recognition of Aura’s
business activity resulted in a low share price. The reasons revolve around the poor outcome for
Aura’s February share placement, unavoidable delays in studies, uranium price and the general
market tone around the US/China Trade War.
To re-iterate however, Aura’s development projects are in excellent shape and the events and
achievements that drove this strong business build were as follows;
•
•
•
•
•
•
•
•
•
In late 2018 Aura secured the Exploitation Licence for the Tiris Uranium Project.
Following definition of the Häggån Vanadium Project high grade zone Aura pursued the
Häggån Scoping Study aggressively and completed capital and operating cost estimates for
the new project before the end of the financial year.
With a strong vanadium price and a will to innovate, Aura also detailed the path to vanadium
recovery with the Tiris Uranium Project. This vanadium will be a strong revenue contributor
Declaring Aura was putting “the building blocks to cashflow’ in place the Company secured a
significant offtake agreement for its Tiris Uranium Project which still allowed exposure to
higher uranium prices in the future.
An additional building block was the commencement of a detail process via our London-based
advisors to obtain low-cost Export Credit Finance support for both Tiris and Häggån
After some years of patient frustration Aura secured two highly prospective gold exploration
licences near the massive Kinross Tasiast project. Nickel and cobalt also identified here.
The Company later expanded that position securing additional ground prospective for its
Tasiast South Project.
Significantly in May 2019 Aura produced the first Mauritanian Yellowcake ever as part of the test
work for Tiris.
Subsequent to the end of the financial year, Aura announced the completion its Tiris Uranium
Project Definitive Feasibility Study with the Häggån Vanadium Scoping Study close behind.
Aura will continue to pride itself on real advancement of the projects it has already discovered in-
house and this is achieved with the excellent technical team it has assembled over the years. Aura
thanks this team and all it staff and director for their efforts during the year.
In the year ahead Aura is targeting finance for the Tiris Project and, subject to a receptive uranium
environment, a move towards development of the project. Additional optimization projects around
Tiris have been commissioned and should result in project improvements.
The Häggån Project Study will be released and, in conjunction, Aura will pursue battery
manufacturing initiatives with that project.
Page 1
CHAIRMAN’S LETTER
Also, to place the Häggån Vanadium Project and gold tenements on a stronger independent funding
footing the Company will seek more optimum corporate structures for these assets.
I want to thank the shareholders for their support in the year and we look forward to delivering
shareholder returns off the back of the strong business we have created.
Yours sincerely
PD Reeve
Executive Chairman
Page 2
REVIEW OF OPERATIONS
URANIUM
Tiris Uranium Project
By the end of the financial year, the Group had virtually completed the Tiris Definitive Feasibility Study.
The formal release of the DFS took place on 29 July 2019 and confirmed the Tiris Uranium Project as a
low cost and low operating cost development.
The DFS is designed to support a 1.25 million tonne/annum (Mtpa) uranium processing plant, an
associated open cut mine, and supporting infrastructure.
The Tiris Uranium Project is based on a substantial greenfield uranium discovery by the Company with
51.8 million pounds U3O8 in current resources. Two exploitation licences covering 390 km2 were granted
to Tiris Ressources SA, a Mauritanian registered subsidiary of Aura, on 8 February 2019. The two
licences cover the Eastern Tiris resources at Oued El Foule and Ain Sder. An application for a 38 km2
exploitation licence remains pending over the smaller Western Tiris resource at Oum Ferkik.
Figure 1
Project Location
This DFS is focussed primarily on the two granted exploitation permits - 2491C4 Ain Sder and 2492C4
Oued El Foule. These comprise the Eastern Tiris resource zone in Wilaya du Tiris Zemmour.
Page 1
REVIEW OF OPERATIONS
Geology
Table 1
Mineral Resources
Over the years there has been three resource estimation exercises carried out with the 2017 drilling
campaign substantially upgrading a portion of the resources to Measured and Indicated status (see ASX
Announcement, dated 30 April 2018).
Potential exists to add to the resource base within the immediate vicinity of the recently known resources.
In the Sadi zone, drilling has demonstrated that mineralisation extends at least 1.5 kilometres south of the
current resource boundary. This extension has not been closed off by drilling or included in any resource
boundary.
The delineation of Measured and Indicated Resources (see Table 1) has been limited for cost reasons
only to portions of the of the Lazare and Hippolyte deposits. Additional Measured/Indicated Resources will
be established within the currently defined Inferred Resources zones, and within further resources yet to
be outlined.
The declared Ore Reserves at a 175 ppm U3O8 cut-off is set out in Table 2.
The Ore Reserves were generated by H&S Consultants with appropriate modifying factors to apply for
mining dilution This Resource model was used in an open pit optimisation process, to produce a rang of
pit areas using operating costs and other inputs derived from previous studies.
Mining Plus were retained by the Group to complete the mining design for the Tiris Uranium Project,
including Ore Reserve estimation in accordance with The Australasian Code for Reporting of Exploration
Results, Mineral Resources and Ore Reserves (the “JORC Code”), 2012 Edition.
The uranium mineralisation lies largely within 3 to 5 metres of the surface in a relatively soft, free digging
material containing patchy calcrete. Based on trenching and metallurgical test work to date, the
mineralisation does not require blasting before mining or crushing prior to beneficiation.
Page 2
REVIEW OF OPERATIONS
Table 2
Ore Reserves
Description
Mt
U3O8
(ppm)
U3O8 (Mlb)
Proved
Probable
Proved
Probable
Proved
Probable
Proved
Probable
Total
Lazare North
0.7
4.4
Lazare South
1.5
0.7
Hippolyte
1.9
1.7
Total Reserve
4.1
6.8
10.9
354
332
342
340
331
334
339
333
336
0.6
3.2
1.1
0.5
1.4
1.3
3.1
5.0
8.1
Mining
The Feasibility Study (see ASX Announcement, dated 29 July 2019) has shown that the three mining
areas can be developed in a practical sequence to production 800,000-1,100,000 pounds per year of UO4
through the processing plant for over ten years. The first nine years will come from the currently defined
Measured or Indicated Resources, which form the declared Ore Reserve.
The cost to develop and operate the mine for 10 years has been estimated at US$66 million or US$2.24
per tonne of material mined.
Resource optimisations for the Lazare North, Lazare South, Hippolyte, Hippolyte South and Sadi were
developed for the Feasibility Study using an optimisation sales price of US$44 per pound for U3O8 as set in
the Offtake Agreement between the Group and Curzon Uranium Trading Limited (see ASX
Announcement, dated 29 January 2019).
A conventional open pit dry mining method utilising a combination of bulldozers, excavators and trucks will
be employed through a contract mining arrangement. Where waste is mined it will be returned to a
previously mined area without the need for building waste dumps.
Processing
The uranium is hosted with ultra-fine grained carnotite (K2(UO2)2(VO4)2.3H2O) that is loosely attached to
barren gangue particles. This means uranium bearing carnotite can be readily separated from barren
particles, allowing highly efficient upgrade of uranium concentration by simple scrubbing and screening.
This greatly reduces the mass of material for leaching, reducing footprint and throughput for the
hydrometallurgical plant.
The processing facility consists of three main sections. These are separated by surge tanks and include:
•
•
Beneficiation circuit
Uranium extraction circuit (Alkaline leach – solid liquid separation – Ion exchange)
Page 3
REVIEW OF OPERATIONS
•
Uranium purification and precipitation circuit.
Tiris mineralisation is well suited to uranium recovery by alkaline leaching, using the sodium carbonate/
sodium bicarbonate system. The leach is undertaken at a temperature of 90°C with a residence time of 12
hours.
For alkaline systems the main process options available for recovery of uranium are ion exchange (IX),
Resin in Pulp (RIP), or Direct Precipitation. For the Tiris process, ion exchange was selected. For efficient
application of Direct Precipitation higher concentrations of uranium in leach solution would be required, to
minimise downstream reagent requirements. Similarly, the elevated clay concentration may cause
‘binding’ of resin in an RIP system, reducing recovery efficiency.
After ion exchange the resin loaded with uranyl carbonate is eluted using sodium bicarbonate. The eluted
uranium stream is then further concentrated by nano-filtration, and sodium bicarbonate recovered for
recycle back to the leach circuit. Uranium is then precipitated with sodium hydroxide as sodium diuranate
(SDU). The SDU precipitate is filtered and dissolved in sulphuric acid as uranyl sulphate, ready for final
precipitation.
Uranium is precipitated with hydrogen peroxide to form the final uranyl peroxide (UO4) product. UO4 will
then be dried or calcined to form the final Yellowcake product. Yellowcake is a term used to cover all
Uranium Oxide Concentrates (UOC), which may include UO4, UO3, UO2 or U3O8.
The final UOC product will be packed in secure 205L IP-1 open head steel drums and strapped within a
6m container for transport by road to the Port of Nouakchott.
Figure 2
Infrastructure
The infrastructure component of the Tiris Project includes all supporting facilities located outside the
mining area. Infrastructure includes the engineering design, procurement and management for the
following site infrastructure works:
• Internal roads within the process site, and minor roadworks on the 665km site access road from Zouerat.
Page 4
REVIEW OF OPERATIONS
•
•
•
•
•
•
•
•
•
Bulk earthworks
Accommodation camp installation, reticulated services, waste disposal, water treatment and
associated infrastructure.
Transportable buildings including offices, change rooms, crib rooms and ablutions.
Communications systems
Steel framed buildings including workshops, warehouse and uranium packaging building.
Power reticulation across the project site.
Site security.
Process plant security.
Remote water borefield and pipeline.
The process plant area includes a heavy vehicle workshop, which will carry out maintenance on all the
mining fleet. All the designated road areas within the process plant area, and the process plant equipment
area, will require some soil compaction to avoid settlement. Key process equipment/traffic areas will be
prepared by stripping the topsoil, proof rolling the area and installing a crushed compacted granite sub-
base. Earthworks will thus be limited to the minimum required only. No earthworks are planned for the
camp 3km north east of the process plant, due to the low building weights involved.
Capital and operating costs
Engineering company, Mincore Pty Ltd, provided the capital cost estimate for the Tiris Project which
included the scope of facilities and services required to design, purchase and construct the entire project,
up to practical completion and handover to operations.
An exhaustive in-country engineering review was conducted during the course of the financial year
covering all infrastructure needs and, particularly, the road infrastructure to site. The in-country review
found that of the 680 km road from Zouerate to Tiris, only 2km will require substantial roadworks.
Significantly, 85% of the capital cost for the Tiris Uranium Project has been sourced from direct supplier
quotes. As a result of this thorough estimating approach, Aura is confident that the capital cost estimate
for Tiris Uranium Project is robust.
No direct mining capital costs are outlined, as infrastructure to support the mining operations is included in
the infrastructure numbers, there is no pre-strip required and mining costs are based direct supplier quotes
from a number of mining contractors with all mobile equipment costs included in the operating cost
estimation received.
Table 3
Capital Costs
The Power generation capital costs have been allocated to Operating expenses, with the delayed costs
paid over three years once production commences. Aura obtained conceptual agreement to this financing
arrangement, with one of the Power generation suppliers. The capital expenditure total cost is therefore
reported as $62.94M USD.
Page 5
REVIEW OF OPERATIONS
The scope for the facilities also includes two specialised plant areas that were separately engineered for
both quantities and prices. The specialised plant areas include:
•
•
Leach and uranium recovery plant developed by Simulus Engineers, and
Fluid bed precipitation, calcining and drum packing plant developed by Adelaide Control
Engineering.
The costing for these two specialised packages includes full engineering, procurement of all equipment
and packing ready for transportation (site erection and commissioning by others).
The operating cost estimate for the Tiris Project was developed by Aura Energy with assistance of
MinCore Engineers, Simulus Engineers and MiningPlus. An estimate review was undertaken by METS
Engineering. The estimate is based on the LOM ore schedule, process design criteria, steady state mass
and energy balance and metallurgical test work undertaken as part of the Feasibility Study.
The estimate includes all costs associated with production of an average 0.8Mlbs U3O8 per annum,
including:
•
•
•
•
•
•
•
•
•
•
•
Contract mining;
Labour;
Fuel;
Power;
Reagents and consumables;
Maintenance;
General and administration;
Product transport;
Sustaining capital;
World Bank Community contributions; and
Royalties.
The operating cost estimate is considered to have an estimate accuracy of +15% -10%.
The comparison of the DFS Capital cost estimate with the Scoping Study showed an increase of 21% from
the 2014 escalated estimate. This is a good result given the greater detail in the DFS estimate.
Importantly, the estimate for the main processing facility was within 3% between the studies.
Table 4
Operating Costs
VANADIUM
Haggan vanadium project
The Group commenced an infill diamond drilling campaign at Häggån in late November 2018 aimed at
upgrading 250 million lbs V2O5 to Measured and Indicated Resource status. The drilling campaign involved
a 3,000-metre of drilling in 22 holes and was completed by the end of April 2019.
Page 6
REVIEW OF OPERATIONS
Figure 3
Location of Northwest High-Grade Zone
The program is focussed on the northwest high-grade vanadium zone at the Haggan vanadium project.
As well as containing high grade vanadium, the mineralisation comes close to surface in this zone with the
top of mineralisation averaging circa 27 metres below surface in the recent drilling.
While the mineralisation is up to 200 metres thick the drilling is aiming to test only the upper 100 metres as
this is likely to support mining for the first 15 years.
On 23 May 2019 (see ASX Announcement, dated 23 May 2019), the group informed the market orebody
modelling had defined a significant high-grade vanadium zone close to the surface. The modelling
confirmed the Global Resource of 15.1 billion pounds of V2O5 which included a new significant high-grade
hear surface vanadium zone of 90 million tonnes at 0.42% V2O5 at a cut-off grade of 4000 ppm.
On 14 August 2019, the Group announced assays from the 3,000-metre drilling campaign (see ASX
Announcement, dated 14 August 2019) with the most significant results:
.
•
•
•
•
•
•
103 metres at 0.41 % V2O5 hole 19DDHG085
101 metres at 0.43 % V2O5 hole 19DDHG089 (including 68 metres at 0.5% V2O5)
93 metres at 0.41 % V2O5 hole 19DDHG084
78 metres at 0.43 % V2O5 hole 19DDHG083
71 metres at 0.43 % V2O5 hole 19DDHG080
54 metres at 0.45 % V2O5 hole 19DDHG090
Page 7
REVIEW OF OPERATIONS
Figure 4
High-Grade Vanadium Zone
Depth to the top of the mineralisation in the 28 drillholes in this high-grade zone averaged 27 metres which
confirms the low stripping ratio of the future/planned mining operation.
The area covered by the recent drilling in this high-grade zone covers only a small portion of the giant
Häggån Resource leaving potential for repeats of the current zone to be discovered within proximity of the
current resource.
By the end of the financial year, all major technical work for the Häggån Scoping Study has now been
completed as per schedule with the final report being assembled currently. The Haggan Scoping Study
will be released in early October 2019.
GOLD AND BASE METALS
Tasiast South tenements
On 3 April 2019 (see ASX Announcement, dated 3 April 2019) the group was granted, through its
Mauritanian controlled entity, TIMCO sarl, two exploration tenements covering of 175km2 in an
underexplored greenstone belt The areas lie along strike from the giant 20 million ounce Tasiast gold
mine operated by Kinross Gold Corporation and Tijirit gold project held by Algold Inc. The Group believes
that these tenements, with the single large Tasiast gold mine along strike, and strong base and battery
metal results, represent some of the best under-explored greenstone belt targets in the world.
The prospects cover portions of the Tasiast and Tijirit greenstone belts which have been previously
explored by another entity but it was forced to suspend activities in the mineral industry downturn in 2012,
despite having located zones of significant gold mineralisation. Drilling by the previous holder of the
tenements was shallow with some limited deeper reverse circulation (RC) drilling testing below air-core
drilling. A small number of RC holes have provided very good results; however. the density of drilling is
very low averaging approximately one hole per 20 km2.
On 11 June 2019 (see ASX Announcement, dated 11 June 2019), the group informed the market that it
had extended its footprint in this greenstone belt by entering into a Farm-in and Joint Venture Agreement
with Nomads Mining Company sarl.
The formal agreement was executed on 26 June 2019.
Under the agreement the Group has a right to earn 70% of the equity in Nomads Mining Company sarl of
Mauritania by funding US$1,000,000 of exploration expenditure. The exploration tenement, Nderik, covers
approximately 50 km2 of Archean greenstones in the Tasiast greenstone belt. The Nomads’ Nderik
Page 8
REVIEW OF OPERATIONS
tenement adjoins and is along strike from the Group’s Touerig Taet exploration tenement which covers
approximately 30 km in strike length of the Tasiast greenstones.
Figure 5
Tasiast Greenstone Belt
The Group is not aware of any significant prior exploration on the Nderik tenement area despite the area
being previously held by Normandy La Source (who made the initial discovery of the Tasiast gold deposit)
during the 1990s. The area of the Nderik tenement, which is close to the large Tasiast mine, has not been
exposed to modern exploration techniques.
Initial field geological work indicates the greenstone sequences within the Nderik tenement and within the
Group’s Touerig Taet tenement have strong similarities in age (late Archean) and geology with those of the
prolifically mineralised greenstone belts in the Yilgarn Province of Western Australia and the Superior
Province in Canada. In the Mauritanian Archean greenstone belts, there is currently only one operating
mine (excluding small-scale artisanal mining which is active in the area) operated by Kinross at Tasiast
and one other reported gold resource at Tijirit held by Algold Limited.
Figure 6
Operating Mines in Yilgarn vs Tasiast
Page 9
DIRECTORS’ REPORT
The directors present their report, together with the financial statements of Aura Energy Limited (ACN 115
927 681) (hereafter referred to as the “Company”), for the financial year ended 30 June 2019.
Principal Activities
The principal activities of the Company during the financial year were exploration and evaluation of
uranium, vanadium and gold and base metals in Mauritania and Sweden. There was no significant change
in the nature of these activities during the year.
Operating Results
The Group recorded a net loss after tax of $2,896,262 the year ended 30 June 2019 (the net loss after tax
for the previous financial year was A$1,987,057). The increase in the net loss after tax was primarily due
to higher employee benefits, financing costs (Convertible Security Funding Agreement) and consulting and
government and public relations costs. The impairment of exploration expenditure previously capitalised
on Swedish tenements also negatively impacted on the result.
State of affairs of the Company
No significant changes in the Company’s state of affairs occurred during the financial year.
Dividends
No dividends were declared and paid during the year.
Events After Balance Date
On 16 July 2019 (see ASX Announcement ,dated 16 July 2019), the Group issued to:
•
•
•
•
11,111,111 fully paid ordinary shares to Lind Global Macro Fund LP on receipt of its first conversion
notice pursuant to the terms and conditions of the Convertible Security Funding Agreement. dated
30 April 2019. The value of the shares issued to Lind Global Macro Fund LP was $100,000.
5,000,000 fully paid ordinary shares on the conversion of performance shares to Messrs NJ Clifford
and JM Madden and DR WR Goodall under the terms and conditions of the Long-Term Incentive
Plan. The value of the shares issued to management on conversion of performance shares was
$105,000.
3,251,773 fully paid ordinary to the shareholders of Nomads Mining Company Limited pursuant to
the first payment of the entry fee pursuant to the Farm-in and Joint Venture Agreement, dated 26
June 2019. The value of the shares issued to the shareholders of Nomads Mining Company sarl
$36,127 (the equivalent of US$26,000).
1,893,233 fully paid ordinary shares to SD Capital Advisory Limited and GKB Ventures Limited
pursuant to the Letter of Engagement, dated 25 January 2019, for advisory services associated
with securing ECA financing. The value of the shares issued to SD Capital Advisory Limited and
GKB Ventures Limited was $21,564.
On 21 July 2019 (see ASX Announcement, dated 21 July 2019), the Group issued 15,430,919 loyalty
options to shareholders that subscribed to the rights issue (see ASX Announcement 21 June 2019). The
loyalty options expire on 21 July 2020 and are exercisable at 2.2 cents per option over ordinary share.
The loyalty options were issued at 0.5 cents per option over ordinary share and raised $77,154.
On 25 July 2019 (see ASX Announcement, dated 25 July 2019), the Group released a cleansing
prospectus to enable the Group to issue a replacement convertible note to Lind Global Macro Fund LP as
required by the Convertible Security Funding Agreement (see ASX Announcement, dated 30 April 2019).
Page 10
DIRECTORS’ REPORT
On 29 July 2019 (see ASX Announcement, dated 29 July 2019), the Group released to the market the Tiris
Uranium Project definitive feasibility study.
On 12 August 2019 (see ASX Announcement, dated 12 August 2019), the Group issued to 1,931,218 fully
paid ordinary shares to SD Capital Advisory Limited and GKB Ventures Limited pursuant to the Letter of
Engagement, dated 25 January 2019, for advisory services associated with securing ECA financing. The
value of the shares issued to SD Capital Advisory Limited and GKB Ventures Limited was $21,475.
On 14 August 2019 (see ASX Announcement, dated 14 August 2019), the Group release a revised
Mineral Resource estimate for its Haggan vanadium project.
On 6 September 2019 (see ASX Announcement, dated 6 September 2019), the Group issued to:
•
•
14,285,715 fully paid ordinary shares to Lind Global Macro Fund LP on receipt of its second
conversion notice pursuant to the terms and conditions of the Convertible Security Funding
Agreement. dated 30 April 2019. The value of the shares issued to Lind Global Macro Fund LP
was $100,000.
2,041,281 fully paid ordinary shares to SD Capital Advisory Limited and GKB Ventures Limited
pursuant to the Letter of Engagement, dated 25 January 2019, for advisory services associated
with securing ECA financing. The value of the shares issued to SD Capital Advisory Limited and
GKB Ventures Limited was $22,209.
On 19 September 2019, the Company and Lind Global Macro Fund LP executed an R&D Funding
Agreement whereby the Company received $250,000 to fund its research and development activities and
repay the R&D Funding by way of assigning its Tax Rebate.
On 25 September 2019 (see ASX Announcement, dated 25 September 2019), the Group issued to:
•
•
•
16,666,667 fully paid ordinary shares to Lind Global Macro Fund LP on receipt of its third
conversion notice pursuant to the terms and conditions of the Convertible Security Funding
Agreement. dated 30 April 2019. The value of the shares issued to Lind Global Macro Fund LP
was $100,000.
18,811,250 fully paid ordinary shares to Met Forages sarl under the terms and conditions of a
Drilling Settlement Agreement, dated 25 July 2019. The value of the shares issued to Met Forages
sarl was $150,490.
2,021,250 fully paid ordinary shares to WH Ireland Limited for advisory services. The value of the
shares issued to WH Ireland Limited was $16,170.
On 30 September 2019, the Company issued a supplementary prospectus to amend the terms and
conditions of the options over ordinary shares set out in its prospectus, dated 19 June 2019, in relation to
proposed listed options granted to subscribers to the Share Placement and Share Purchase Plan. The
Company simultaneously issued 11,604,181 unlisted options and 19,544,508 loyalty options over ordinary
shares pursuant to the Share Placement and Share Purchase Plan.
Page 11
Information on directors
DIRECTORS’ REPORT
PD Reeve
Executive Chairman and Managing Director
Qualifications
Bachelor of Applied Sciences.
Experience
Board member since 13 July 2013 with over 30 years’ experience positions with
Rio Tinto, Billiton Australia and Newcrest Mining as well as experience as a
Resource Fund Manager and Resources Corporate Finance Director at J B
Were and Son.
Interest in shares and
options
Directorships held in
other listed entities in last
3 years
Dr R Beeson
More recently Peter was Chief Executive Officer of Ivanhoe Australia Ltd.
27,218,304 ordinary shares directly in Aura Energy Limited and 17,500,000
performance shares and 3,103,724 indirectly in Aura Energy Limited.
Round Oak Minerals Pty ltd (formerly CopperChem Limited) from 2013
Director (Non-executive)
Qualifications
Experience
Bachelor of Science with Honours; PhD; Member of the Australian Institute
of Geoscientists
Board member since 31 March 2006.
Interest in shares and
options
Directorships held in
other listed entities in last
3 years
Geologist with over 35 years of global experience in uranium and other
commodity management, exploration and development.
3,129,071 ordinary shares directly in Aura Energy Limited and 2,820,366
ordinary shares and 166,667 options over ordinary shares indirectly in Aura
Energy Limited.
Managing Director of Drake Resources Limited from November 2004 until
31 January 2015.
Non- executive director or Drake Resources Limited until 10 March 2017, Non-
executive Director of Cohiba Resources Limited from 3 May 2018.
BF Fraser
No other directorships in the past three years.
Director (Non-executive)
Qualifications
FCPA, F.Fin, B.Bus, FGIA
Experience
Board member since 24 August 2005.
Mr Fraser has worked in the finance and securities industry for over 25 years’
and has owned and operated businesses across wine, health, finance, media
and mining.
Interest in shares and
options
Directorships held in
other listed entities in last
3 years
546,965 ordinary shares directly in Aura Energy Limited and 3,419,636
ordinary shares indirectly in Aura Energy Limited.
Non-executive director and Chairman of Blina Diamonds NL until 19
September 2019 and non- executive director and Chairman of Drake
Resources Limited until 10 March 2017. Non-executive Director of Sundance
Resources Limited from 10 March 2018.
JC Perkins
Qualifications
No other directorships in the past three years.
Director (Non-executive)
Master of Science (Imperial College of Science and Technology) 1972;
Associate of the Camborne School of Metalliferous Mining (Honours) 1967;
Fellow of the Australasian Institute of Mining and Metallurgy; and Graduate of
the Australian Institute of Company Directors.
Experience
Board member since 7 June 2011.
Page 12
DIRECTORS’ REPORT
Mr. Perkins has over 40 years’ experience in operations and management with
major companies in the international minerals industry. He was Manager of
Mining and Technology (Australia) for AngloGold Ashanti Ltd, until 2006. His
career includes operating and management roles on the Zambian Copperbelt,
leading the mineral processing at Shell Research in the Netherlands before
returning to corporate management in Australia.
He was Chairman of Parker Centre Ltd for Hydrometallurgy from 2006 to 2012
and previously a director of the CRC Mining and the Australian Centre for
Mining Environmental Research.
3,799,490 ordinary shares and 500,000 options over ordinary shares
indirectly in Aura Energy Limited.
No other directorships held in other listed entities.
Interest in shares and
options
Directorships held in
other listed entities in last
3 years
Meetings of directors
During the financial year, the board of directors held 12 meetings (including committee meetings of
directors) with the remainder of meetings conducted by way of written resolution. Attendances by each
director during the year were as follows:
Directors
Meetings
Committee Meetings
Audit & Risk
Committee
Meetings
Remuneration
Committee
Meetings
No
Attended
No
Attended
No
Attended
PD Reeve
R Beeson
BF Fraser
JC Perkins
8
8
8
8
8
7
8
8
-
-
-
-
2
2
2
2
2
2
2
2
2
2
2
2
Non-Audit Services
Bentleys, the external auditor for the Group, provided the parent entity, Aura Energy Limited, with taxation
services during the financial year totalling $3,200 (2018: $894). Details of remuneration paid to the auditor
can be found within the financial statements at Note 31 Auditor’s remuneration.
The directors are satisfied that the provision of non-audit services during the year by Bentleys (or by another
person or firm on Bentley’s behalf) is compatible with the general standard of independence for auditors
imposed by the Corporations Act 2001 (Cth).
Indemnifying officers or auditor
During or since the end of the financial year the Group has given an indemnity or entered into an agreement
to indemnify, or paid or agreed to pay insurance premiums as follows:
•
•
The Group has entered into agreements to indemnify all directors and provide access to documents,
against any liability arising from a claim brought by a third party against the Company. The agreement
provides for the Company to pay all damages and costs which may be awarded against the directors.
The Group has paid premiums to insure each of the directors against liabilities for costs and expenses
incurred by them in defending any legal proceedings arising out of their conduct while acting in the
capacity of director of the company, other than conduct involving a wilful breach of duty in relation to the
Company. The amount of the premium was $41,140 (2018: $31,959).
Page 13
DIRECTORS’ REPORT
No indemnity has been paid to auditors of the Group
Environmental regulations
The Company is commencing exploration and evaluation activities in Mauritania and Sweden. Both countries
have environmental regulation for the conduct of exploration activities. The Company has complied with these
environmental regulations in the conduct of all field activities.
The directors have considered the enacted National Greenhouse and Energy Reporting Act 2007 (the NGER
Act) which introduced a single national reporting framework for the reporting and dissemination of information
about the greenhouse gas emissions, greenhouse gas projects, and energy use and production of
corporations. At the current stage of development, the directors have determined that the NGER Act has no
effect on the Company for the current, nor subsequent, financial year. The directors will reassess this position
as and when the need arises
Options
On 21 July 2019 (see ASX Announcement, dated 21 July 2019), the Group issued 15,430,919 loyalty
options to shareholders that subscribed to the rights issue (see ASX Announcement 21 June 2019). The
loyalty options expire on 21 July 2020 and are exercisable at 2.2 cents per option over ordinary share.
The loyalty options were issued at 0.5 cents per option over ordinary share and raised $77,154.
financial year and there were no options outstanding at the date of this report.
At the date of this report, the unissued ordinary shares of the Company under options (listed and unlisted)
are as follows:
Grant date
Expiry date
Exercise
Price
Option
Number
14 June 2018
14 June 2018
14 June 2018
14 June 2018
18 July 2019
30 April 2019
30 September 2019
30 September 2019
30 September 2019
30 September 2019
30 September 2019
30 September 2019
18 July 2020
30 April 2022
31 July 2021
31 July 2020
$0.0330
$0.0330
$0.0330
$0.0330
$0.0220
$0.0160
$0.0220
$0.0220
96,815,790
5,000,000
2,747,788
1,172,566
15,430,919
62,500,000
11,604,161
19,544,508
214,815,732
No person entitled to exercise an option over ordinary shares has or has any rights by virtue of the option
over ordinary shares to participate in any share issue of any other body corporate.
Proceedings on behalf of the Group
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.
Auditor’s Independence Declaration
A copy of the auditor’s independence declaration as required under section 307C of the Corporations Act
2001 is set out on page 21.
Page 14
REMUNERATION REPORT
Remuneration report (audited)
Remuneration policy
The remuneration policy of the Group has been designed to align director and management objectives with
shareholder and business objectives by providing a fixed remuneration component, and offering specific long-
term incentives based on key performance areas affecting the Group’s financial results. The board of directors
believes the remuneration policy to be appropriate and effective in its ability to attract and retain the best
management and directors to run and manage the Group, as well as create goal congruence between
directors, executives and shareholders.
The policy of the board of directors for determining the nature and amount of remuneration for board members
and senior executives of the Group is described in the following paragraphs.
The remuneration policy of the Group sets the terms and conditions for executive directors and other senior
executives. Due to the rapidly changing circumstances of the Group in recent years, the policy is reviewed
annually by the board of directors with the purpose of maintaining alignment of the board and management
with the Group’s strategic objectives. Management is also entitled to participate in employee share and option
arrangements. All executives receive a base salary which takes into account such factors as length of service
and experience, superannuation and share based incentive such as options. The board of directors review
executive packages annually by reference to the performance of the Group, individual executives and relevant
comparable remuneration data from similar listed companies and appropriate industry sectors. Independent
expert advice is sought as required
The total amount of non-executive directors’ remuneration is proposed by the board of directors from time to
time at the Annual General Meeting and is subject to formal approval by shareholders. Within this limit, the
board of directors presently remunerates non-executive directors at around the average of those obtained from
relevant comparable data from similar listed companies and appropriate industry sectors. A measure of longer-
term incentive is provided by the allocation of options to non-executive directors. The board of directors
determines remuneration to individual non-executive directors, working within the limit set by shareholders,
and taking into account any special duties or accountability. Payments to non-executive directors are not linked
to Company performance but in order to align their interest with those of shareholders, non-executive directors
are encouraged to hold shares in Aura Energy Limited.
Executives and non-executive directors have received a superannuation guarantee contribution as required by
law, which increased to 9.5% on 1 July 2014, but do not receive any other retirement benefits.
All remuneration paid to non-executive directors and executives is valued at the cost to the Company and is
expensed. Options over ordinary shares granted to directors and employees are valued using the Black-
Scholes methodology. Details of directors’ and executives’ interests in options as at 30 June 2018 are
provided in the Remuneration Report of the financial statements.
The Chairman became Executive Chairman and Managing Director of the Company with effect on 1 January
2015 and accordingly, is a fulltime employee. The Executive Chairman and Managing Director had agreed to
settle 20% of his salary by way of fully paid ordinary shares in the Company. On 2 November 2017, the above
arrangement was varied by the Company and the Executive Chairman and Managing Director to convert the
share-based remuneration to a cash-based remuneration.
Under clause 14.7 of the Constitution of the Company, shareholders approved at the annual general meeting
on 30 November 2017 the total aggregate amount fixed sum per annum to be paid to non- executive directors
increase from $200,000 to $300,000.
At the annual general meeting on 14 November 2018, 78.7% of votes cast for the adoption of the
remuneration report voted in favour of the resolution. The number of votes cast in favour of the resolution
totalled 142,294,652.
Page 15
REMUNERATION REPORT
Remuneration details for the financial years ended 30 June 2019 and 2018
Group KMP
Short-term benefits
Post-
Employment
Benefits
Long-term
Benefits
Share-based payments
Total
% S-BP
Salary/Fees/
Leave
Profit share/
Bonuses
Non-
monetary
Other
Super-
annuation
Other
Equity
Options/
Performance
Shares
PD Reeve
R Beeson
BF Fraser
JC Perkins
JM Madden
PD Reeve
R Beeson
BF Fraser
JC Perkins
JM Madden
425,000
40,000
40,000
40,000
151,300
696,300
400,000
40,000
40,000
43,800
-
523,800
For Financial Year Ended 30 June 2019
-
-
-
-
-
-
-
-
-
-
-
-
25,000
3,800
3,800
3,800
-
36,400
For Financial Year Ended 30 June 2018
-
-
-
-
-
-
-
-
-
-
99,936
25,000
3,800
3,800
-
-
99,936
32,600
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
362,832
-
-
-
56,000
812,832
43,800
43,800
43,800
207,300
44.6%
-
-
-
27.0%
418,832
1,151,532
41.1%
25,000
-
-
-
-
297,916
-
-
-
-
747,916
43,800
43,800
43,800
99,936
25,000
297,916
979,252
39.8%
-
-
-
-
39.8%
Page 16
REMUNERATION REPORT
Service Agreements
The Executive Chairman and Managing Director, Peter Reeve, is employed under a contract of employment, effective
1 January 2015.
The employment deed stipulates a four weeks’ resignation period. The Company may terminate the employment
contract without cause by providing four weeks’ written notice, or making payment in lieu of notice based on the
individual’s annual salary component.
If employment is terminated other than for serious misconduct, and the employee is not then otherwise in default of this
contract and his employment, the Managing Director will, in connection with his retirement from the office, receive in
addition to the required four weeks’ notice period, three months’ salary. An additional benefit may be paid in the amount
of one month for every year of service. This is subject to the provisions of the Corporations Act 2001 (Cth), which may
require shareholder approval.
Mr JM Madden does not have a contract with Aura Energy Limited and is employed on a limited basis for 3-4 days
per week and is paid a daily rate; however, during the course of 2018 and 2019 Mr Madden spent approximately 12
weeks in Mauritania and therefore, worked effectively on a full time basis during the period in Mauritania Mr
Madden is not entitled to annual leave or superannuation guarantee levy.
Share-based compensation
a. Incentive Option Scheme
Options are granted under the Aura Energy Limited Incentive Option Scheme. All staff who have been
continuously employed by the Company for a period of at least one year are eligible to participate in the plan.
Options are granted under the plan for no consideration.
b. Director and Key Management Personnel Options
At the general annual meeting of shareholders on 30 November 2017, shareholders approved resolutions to
cancel 35,000,000 options over ordinary shares previously granted to the Executive Chairman and Managing
Director and to award the Executive Chairman and Managing director 35,000,`000 performance shares for zero
consideration with tranche 1 of 17,500,000 performance shares vesting on 30 November 2019 and Tranche 2 of
17,500,000 performance shares vesting on 30 November 2020.
c. Performance shares of Aura Energy Limited held by each KMP
Group KMP
2019
Reeve
Madden
2018
Reeve
Awarded as
remuneration
during the
year
No
Converted
during the
year
No
Other
changes
during the
year
No
Balance at
start of year
No
Balance at
end of year
No
Vested and
convertible
No
35,000,000
-
35,000,000
-
5,000,000
5,000,000
(17,500,000)
-
(17,500,000)
35,000,000
35,000,000
-
-
-
-
-
-
-
-
-
17,500,000
5,000,000
22,500,000
-
1,666,666
1,666,666
35,000,000
35,000,000
-
-
At the annual general meeting of shareholders on 30 November 2017, shareholders approved a resolution to
cancel 35,000,000 options over ordinary shares previously granted to Mr PD Reeve and grant 35,000,000
performance shares for zero consideration. The Group expended $362,832 (2018: $275,042) during the
financial year for these performance shares.
The performance shares issued to Mr PD Reeve vested over two years with the first tranche of 17,500,000
vesting on 30 November 2018 and the second tranche of 17,500,000 vesting on 30 November 2019.
Page 17
REMUNERATION REPORT
The amount expensed during the financial year represents the share price on the date of grant for the
performance shares (2.2 cents per share) multiplied by the number of performance shares issued and
subject to a probability of milestone achievement evaluated each balance date.
On 17 June 2018, the Group awarded Messrs NJ Clifford and JM Madden and Dr WR Goodall with each
issued 5,000,000 performance shares. The board of directors ratified the issue of the performance shares
on 4 September 2018. The performance shares vest over three years from 17 June 2019 through to 17
June 2021.
The amount expensed during the financial year represents the share price on the date of grant for the
performance shares (2.1 cents per share) multiplied by the number of performance shares issued and
subject to a probability of milestone achievement evaluated each balance date.
Mr NJ Clifford and Dr WR Goodall are not classified as Group KMP.
d. Options of Aura Energy Limited held by each KMP
Group KMP
2019
2018
Reeve
Granted as
remuneration
during the
year
No
Exercised
during the
year
No
Other
changes
during the
year
No
Balance at
start of year
No
Balance at
end of year
No
Vested and
exercisable
No
-
35,000,000
35,000,000
-
-
-
-
-
-
-
(35,000,000)
(35,000,000)
-
-
-
-
-
-
Dr R Beeson, Mr JC Perkins and Mr JM Madden subscribed to the Share Placement and Share Purchase
Plan during the course of the financial year. As at the date of this annual report, listed options and loyalty
options over ordinary shares have not been issued. Dr R Beeson is entitled to 172,667 options over
ordinary shares, Mr JC Perkins is entitled to 1,072,398 options over ordinary shares and Mr JM Madden is
entitled to 594.371 options over ordinary shares.
e. Description of options issued as remuneration
On 10 June 2015, shareholders at an extraordinary general meeting approved the issue of 35,000,000
options over ordinary shares to Mr PD Reeve. Note the options over ordinary shares granted to Mr PD
Reeve were cancelled at the annual general meeting on 30 November 2017.
The terms of the options over ordinary shares were as follows:
Reason
Vesting date
Percentage
vested
during the
year
%
Percentage
forfeited
during the
year
%
Percentage
remaining
as unvested Expiry date
%
Range of
possible
values
relating to
future
payments
Grant Value
(See Note 1)
$
Grant date
2019
-
-
-
10/06/2015
10/06/2015
10/06/2015
10/06/2015
10/06/2015
66,436
57,884
19,445
87,364
103,555
Note 1
Note 1
Note 1
Note 1
Note 1
9/06/2016
9/02/2016
9/02/2016
9/02/2017
9/02/2018
-
100
100
100
100
-
-
-
-
-
-
-
-
-
-
-
-
100
-
9/06/2018
9/02/2019
9/02/2019
9/02/2020
9/02/2021
-
-
-
-
-
-
Page 18
REMUNERATION REPORT
The options over ordinary shares were granted to Mr PD Reeve, the Executive Chairman and Managing
Director as part of his remuneration and for future performance.
The valuation of the options were determined by applying the Black-Scholes method.
The vesting conditions for Mr PD Reeve were:
• Tranche 1 vest immediately at 10 cents per option over ordinary share with expiry date of 9 June 2018
• Tranche 2 vested at 8 months from the date of issue and was exercisable at 10 cents per option over
ordinary share with expiry date of 9 February 2019
• Tranche 3 vested at 8 months from the date of issue and was exercisable at 15 cents per option over
ordinary share with an expiry date of 9 February 2019
• Tranche 4 vested at 20 months from the date of issue and was exercisable at 15 cents per option over
ordinary share with an expiry date of 9 February 2020
• Tranche 5 vested at 32 months from the date of issue and was exercisable at 15 cents per option over
ordinary share with an expiry date of 9 February 2021
Details of all share-based payments in existence during the financial year can be found at Note 28 Share-
based payments
Grant date
Issuer
Entitlement on
Exercise
Exercisable
dates
Exercise
Price
$
Value per
option at
grant date
$
Amount
paid/payable
by recipient
$
10/06/2015
10/06/2015
10/06/2015
10/06/2015
10/06/2015
Aura
Aura
Aura
Aura
Aura
1:1
1:1
1:1
1:1
1:1
9/06/2018
9/02/2019
9/02/2019
9/02/2020
9/02/2021
$0.10
$0.10
$0.10
$0.10
$0.10
$0.0076
$0.0093
$0.0078
$0.0100
$0.0118
-
-
-
-
-
Equity holdings of each KMP
Group KMP
2019
PD Reeve
R Beeson
BF Fraser
JC Perkins
JM Madden
2018
PD Reeve
R Beeson
BF Fraser
JC Perkins
JM Madden
Received
during the year
as
compensation
No
Conversion of
performance
shares during
the year
No
Subscriptions
to issues of
shares
No
Other
changes
during the
year
No
Balance at
end of year
No
Balance at
start of year
No
12,812,365
5,636,937
3,957,600
2,861,990
215,833
25,484,725
11,599,599
5,636,937
3,957,600
2,861,990
-
24,056,126
-
-
-
-
2,293,806
2,293,806
927,766
-
-
-
215,833
1,143,599
17,500,000
-
-
-
-
17,500,000
-
312,500
-
937,500
625,000
1,875,000
-
-
-
-
-
-
30,312,365
5,949,437
3,957,600
3,799,490
3,134,639
47,153,531
-
-
-
-
-
-
-
-
-
-
-
-
285,000
-
-
-
-
285,000
12,812,365
5,636,937
3,957,600
2,861,990
215,833
25,484,725
During the financial Mr JM Madden was issued fully paid ordinary shares in lieu of amounts due as a contract
employee. In the previous year, Mr PD Reeve was issued fully paid ordinary shares pursuant to his contract of
Page 19
REMUNERATION REPORT
employment and Mr JM Madden was issued fully paid ordinary shares in lieu of amounts due as a contract
employee.
Options over ordinary shares held by KMP
Group KMP
2019
PD Reeve
R Beeson
BF Fraser
JC Perkins
JM Madden
2018
Received
during the year
as
compensation
No
Balance at
start of year
No
Exercised
during the year
No
Issued under
SP/SPP
Raisings
No
Other
changes
during the
year
No
Balance at
end of year
No
-
-
-
-
- -
-
-
-
- -
-
-
-
-
-
-
-
172,667
-
1,072,398
594,371
1,839,436
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
172,667
-
1,072,398
594,371
1,839,436
-
-
Dr R Beeson and Messrs JM Madden and JC Perkins subscribed to the Share Placement and Share Purchase
Plans during the course of the financial year and were issued unlisted options and loyalty options on 30 September
2019 pursuant to the terms and conditions of the above-mentioned equity raising initiatives.
Loans to KMP
There were no loans made to directors of Aura Energy Limited as at 30 June 2019 (2018: Nil).
Other transactions with KMP
At balance date 30 June 2019, Mr JM Madden was owed $25,100 (2018: $16,870) by Aura energy Limited. At
balance date 30 June 2018, Mr BF Fraser was owed $3,166.
There have been no other transactions involving equity instruments other than those described in the annual report.
This report of the directors is signed in accordance with a resolution of the Board of Directors.
PD Reeve
Executive Chairman
Dated this 30 September 2019
Page 20
To The Board of Directors
Auditor’s Independence Declaration under Section 307C of the
Corporations Act 2001
As lead audit Partner for the audit of the financial statements of Aura Energy Limited for
the financial year ended 30 June 2019, I declare that to the best of my knowledge and
belief, there have been no contraventions of:
the auditor independence requirements of the Corporations Act 2001 in relation to
the audit; and
any applicable code of professional conduct in relation to the audit.
Yours faithfully
BENTLEYS
Chartered Accountants
MARK DELAURENTIS CA
Partner
Dated at Perth this 30th day of September 2019
CONSOLIDATED STATEMENT OF PROFIT OR LOSS & OTHER COMPREHENSIVE INCOME
Note
30 June
2019
$
2018
$
Total revenue and other income
5
32,293
6,838
Expenditure
Accounting and audit fees
Computers and communications
Depreciation
Employee benefits
Exploration expenditure related to project generation
Exchange fluctuations
Financing costs
Impairment of exploration and evaluation expenditure
Insurances
Consulting fees and corporate advisory
Government and public relations
Rent and utilities
Share-based payments
Share registry and listing fees
Travel and accommodation
Other
Total expenditure
28
80,600
27,457
7,660
895,326
35,635
(30,327)
149,067
179,152
59,848
458,904
202,769
75,022
530,832
189,874
70,707
38,711
2,971,237
147,225
33,945
12,377
651,703
-
90,145
-
-
42,378
335,026
23,158
71,632
297,916
160,433
72,622
55,335
1,993,895
Loss before tax for year
(2,938,944)
(1,987,057)
Income tax (expense)/benefit
6
42,682
-
Net loss attributable to shareholders
(2,896,262)
(1,987,057)
Total comprehensive income for the year
attributable to:
Foreign currency movement
60,410
(99,732)
Other comprehensive income for the year, net of tax
60,410
(99,732)
Total comprehensive income for the year
(2,835,852)
(2,086,789)
Earnings per share
Basic loss per share (cents per share)
7
(0.26)
(0.23)
The accompanying notes form part of these financial statements
Page 22
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Note
30 June
2019
$
2018
$
9
10
11
12
13
14
15
16
17
18
18
19
20
21
22
812,296
37,294
57,710
907,300
2,844,169
23,881
60,926
2,928,976
4,064
21,008,293
21,012,357
8,124
17,687,868
17,695,992
21,919,657
20,624,968
464,959
63,499
266,667
71,295
694,215
1,560,635
694,216
15,341
709,557
303,133
28,405
-
-
-
331,538
-
-
-
2,270,192
331,538
19,649,465
20,293,430
46,315,150
1,273,829
(27,939,514)
19,649,465
44,698,295
638,387
(25,043,252)
20,293,430
Assets
Current assets
Cash and cash equivalents
Trade and other receivables
Financial assets
Total current assets
Non-current assets
Plant and equipment
Exploration and evaluation
Total assets
Liabilities
Current liabilities
Trade and other payables
Provisions
Financial liabilities
Vendor consideration
Borrowings
Total current liabilities
Non-current liabilities
Borrowings
Provisions
Total liabilities
Net assets
Equity
Contributed equity
Reserves
Accumulated losses
Total equity
The accompanying notes form part of these financial statements
Page 23
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Share
Capital
Note 20
$
Share-based
Payments
Reserve
Note 21
$
Translation
Reserve
Accumulated
Losses
Equity
Note 21
Note 22
$
$
As at 1 July 2017
39,558,943
384,190
457,481
(23,503,501)
16,897,113
Transactions with owners in their capacity
as owners of the Company
Share issues
Equity raising costs
Share-based payments
Net loss for the period
Other comprehensive income
Total comprehensive income
Movements in reserves
Options issued during the year
Options cancelled during the year
Options expired during the year
Options exercised during the year
Performance shares issued during the year
4,945,381
(303,613)
-
4,641,768
-
-
-
-
-
-
497,584
-
-
-
-
-
-
-
-
68,712
(334,684)
(112,622)
-
275,042
-
-
-
-
-
(99,732)
(99,732)
-
-
-
-
-
-
-
-
-
(1,987,057)
-
(1,987,057)
-
334,684
112,622
-
-
4,945,381
(303,613)
-
4,641,768
(1,987,057)
(99,732)
(2,086,789)
68,712
-
-
497,584
275,042
As at 30 June 2018
44,698,295
280,638
357,749
(25,043,252)
20,293,430
Transactions with owners in their capacity
as owners of the Company
Share issues
Equity raising costs
Share-based payments
Net loss for the period
Other comprehensive income
Total comprehensive income
Movements in reserves
Options issued during the year
Options cancelled during the year
Options expired during the year
Options exercised during the year
Performance shares issued during the year
Performance shares converted during the year
666,000
-
565,855
1,231,855
-
-
-
-
-
-
-
-
385,000
-
-
-
-
-
-
-
-
-
-
60,410
60,410
-
-
-
-
(2,896,262)
-
(2,896,262)
429,200
-
-
-
530,832
(385,000)
-
-
-
-
-
-
-
-
-
-
-
-
666,000
-
565,855
1,231,855
(2,896,262)
60,410
(2,835,852)
429,200
-
-
-
530,832
-
As at 30 June 2019
46,315,150
855,670
418,159
(27,939,514)
19,649,465
The accompanying notes form part of these financial statements
Page 24
CONSOLIDATED STATEMENT OF CASH FLOWS
Note
30 June
2019
$
2018
$
Cash flows from/(used) in operating activities
Payments to employees and suppliers
Payments for exploration and evaluation
Other income
Interest paid
Interest received
Net cash flows from/(used) in operating activities
Cash flows from/(used) in investing activities
Purchase of plant and equipment
Net cash flows from/(used) in investing activities
Cash flows from financing activities
Proceeds from share issues
Exercise of options
Equity raising costs
Proceeds from borrowings
Commitment fee paid
Net cash flows
Cash and cash equivalents as at the start of
the financial period
Changes in foreign currency held
Cash and cash equivalents as at the end of
the financial period
27
(1,822,113)
(2,912,693)
66,039
(14,769)
8,936
(4,674,600)
(1,741,985)
(3,140,343)
-
-
6,838
(4,875,490)
(3,600)
(3,600)
(1,596)
(1,596)
666,000
-
-
2,000,000
(50,000)
2,616,000
4,771,051
497,584
(110,195)
-
-
5,158,440
(2,062,200)
281,354
2,844,169
30,327
2,652,960
(90,145)
9
812,296
2,844,169
The accompanying notes form part of these financial statements
Page 25
Note 1
Corporate information
NOTES TO THE FINANCIAL STATEMENTS
These are the consolidated financial statements and notes of Aura Energy Limited and controlled entities
(“Consolidated Group” or “Group”). Aura Energy Limited is a company limited by shares, domiciled and
incorporated in Australia.
The separate financial statements of the parent entity, Aura Energy Limited, have not been presented with
this financial report as permitted by the Corporations Act 2001 (Cth).
a. Basis of preparation
i. Statement of compliance
The financial statements are general purpose financial statements that have been prepared in
accordance with Australian Accounting Standards, including Australian Accounting Interpretations,
other authoritative pronouncements of the Australian Accounting Standards Board and the
Corporations Act 2001 (Cth).
Australian Accounting Standards set out accounting policies that the AASB has concluded would result
in a financial report containing relevant and reliable information about transactions, events and
conditions to which they apply. Compliance with Australian Accounting Standards ensures that the
financial statements and notes also comply with International Financial Reporting Standards as issued
by the IASB. Material accounting policies adopted in the preparation of these financial statements are
presented below. They have been consistently applied unless otherwise stated.
The financial statements were authorised for issue on 30 September 2019 by the directors of the
Company.
ii. Financial position
The financial statements have been prepared on an accruals basis and are based on historical costs
modified, where applicable, by the measurement at fair value of selected non-current assets, financial
assets and financial liabilities.
iii. Going concern
The financial statements have been prepared on a going concern basis, which contemplates the
continuity of normal business activity and the realisation of assets and the settlement of liabilities in the
ordinary course of business.
The Group incurred a loss for the year of $2,896,262 (2018: $1,987,057) and a net cash out-flow from
operating activities of $4,674,600 (2018: $4,875,490).
As at 30 June 2019, the Group had working capital of $378,842 (2018: $2,597,438) (excluding financial
liabilities, the current portion of convertible notes and amounts due to shareholders of Nomads Mining
Company sarl on execution of the Farm-in and Joint Venture Agreement, in part, settled by way of the
issue of shares.)
The ability of the Group to continue as a going concern is principally dependent upon the ability of the
Group to secure funds by raising capital from equity markets or by other means, and by managing cash
flows in line with available funds, and/or the successful development of the Group’s exploration assets.
These conditions indicate a material uncertainty that may cast doubt about the ability of the Group to
continue as a going concern.
Based upon cash flow forecasts and other factors referred to above, the directors are satisfied that the
going concern basis of preparation is appropriate, including the meeting of exploration commitments. In
addition, given the Group’s history of raising funds to date, the directors are confident of the Group’s
ability to raise additional funds as and when they are required.
Should the Group be unable to continue as a going concern it may be required to realise its assets
and extinguish its liabilities other than in the normal course of business and at amounts different to
those stated in the financial statements.
Page 26
NOTES TO THE FINANCIAL STATEMENTS
The financial statements do not include any adjustments relating to the recoverability and classification
of asset carrying amounts or to the amount and classification of liabilities that might result should the
Group be unable to continue as a going concern and meet its debts as and when they fall due.
iv. Use of estimates and judgements
The preparation of financial statements requires management to make judgements, estimates and
assumptions that affect the application of policies and reported amounts of assets and liabilities,
income and expenses. These estimates and associated assumptions are based on historical
experience and various factors that are believed to be reasonable under the circumstances, the results
of which form the basis of making the judgements about carrying values of assets and liabilities that
are not readily apparent from other sources. Actual results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting
estimates are recognised in the period in which the estimate is revised and in any future periods
affected.
Judgements made by management in the application of Australian Accounting Standards that have
significant effect on the financial statements and estimates with a significant risk of material adjustment
in the next year are discussed in Note 2q Critical accounting estimates and judgments.
v. Comparative figures
Where required by Accounting Standards comparative figures have been adjusted to conform with
changes in presentation for the current financial year.
Note 2
Basis of preparation and accounting policies
A controlled entity is any entity over which Aura Energy Limited has the power to govern the financial and
operating policies so as to obtain benefits from its activities. In assessing the power to govern, the
existence and effect of holdings of actual and potential voting rights are considered. A list of controlled
entities is contained in Note 23 Controlled entities in the financial statements.
All inter-group balances and transactions between entities in the Consolidated Group, including any
unrealised profits or losses, have been eliminated on consolidation. Accounting policies of subsidiaries
have been changed where necessary to ensure consistency with those adopted by the parent entity.
As at reporting date, the assets and liabilities of all controlled entities have been incorporated into the
consolidated financial statements as well as their results for the year then ended. Where controlled entities
have entered (left) the Consolidated Group during the year, their operating results have been included
(excluded) from the date control was obtained (ceased).
a. Business combinations
Business combinations occur when an acquirer obtains control over one or more businesses.
A business combination is accounted for by applying the acquisition method, unless it is a combination
involving entities or businesses under common control. The business combination will be accounted for
from the date that control is attained, whereby the fair value of the identifiable assets acquired and
liabilities (including contingent liabilities) assumed is recognised (subject to certain limited exemptions).
When measuring the consideration transferred in the business combination, any asset or liability
resulting from a contingent consideration arrangement is also included. Subsequent to initial
recognition, contingent consideration classified as an asset or liability is remeasured each reporting
period to fair value, recognising any change to fair value in profit or loss, unless the change in value
can be identified as existing at acquisition date.
All transaction costs incurred in relation to the business combination are expensed to the statement of
profit or loss and comprehensive income.
Page 27
NOTES TO THE FINANCIAL STATEMENTS
The acquisition of a business may result in the recognition of goodwill or a gain from a bargain
purchase.
(i) The Group raising sufficient additional funding from shareholders or other parties;
(ii) The group converting existing loans to equity and if necessary, deferring deferred payment
arrangements; and
(iii) The Group reducing expenditure in line with available funding.
b. Exploration and development expenditure
i. Recognition and measurement
Exploration, evaluation, and development expenditure incurred is accumulated in respect of each
identifiable area of interest. These costs are only carried forward to the extent that they are
expected to be recouped through the successful development of the area or where activities in the
area have not yet reached a stage that permits reasonable assessment of the existence of
economically recoverable reserves.
ii. Subsequent measurement
Accumulated costs in relation to an abandoned area are written off in full against profit in the year in
which the decision to abandon the area is made.
When production commences, the accumulated costs for the relevant area of interest will be
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 capitalise costs in relation to that area of interest.
iii. Site restoration and rehabilitation
Costs of site restoration will be provided over the life of the project, when such costs are incurred or
the Group becomes liable pursuant to a development agreement with government agencies. In the
exploration and evaluation phase, all drill holes are collared and any site disturbance is restored
with the costs incorporated in the costs of exploration and evaluation. Site restoration costs will
include the dismantling and removal of mining plant, equipment and building structures, waste
removal, and rehabilitation of the site in accordance with clauses of the mining permits. Such costs
have been determined using estimates of future costs, current legal requirements and technology
on an undiscounted basis.
Any changes in the estimates for the costs are accounted on a prospective basis. In determining
the costs of site restoration, there is uncertainty regarding the nature and extent of the restoration
due to community expectations and future legislation. Accordingly, the costs have been determined
on the basis that the restoration will be completed within one year of abandoning the site.
c. Income tax
Current income tax expense charged to the profit or loss is the tax payable on taxable income
calculated using applicable income tax rates enacted, or substantially enacted, as at reporting date.
Current tax liabilities (assets) are therefore measured at the amounts expected to be paid to (recovered
from) the relevant taxation authority.
Deferred income tax expense reflects movements in deferred tax asset and deferred tax liability balances
during the year as well as unused tax losses.
Current and deferred income tax expense (income) is charged or credited outside profit or loss when
the tax relates to items recognised outside profit or loss.
Deferred tax assets and liabilities are ascertained based on temporary differences arising between the
tax bases of assets and liabilities and their carrying amounts in the financial statements. Deferred tax
Page 28
NOTES TO THE FINANCIAL STATEMENTS
assets also result where amounts have been fully expensed but future tax deductions are available. 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 assets and liabilities are calculated at the tax rates that are expected to apply to the
period when the asset is realised or the liability is settled, based on tax rates enacted or substantively
enacted at reporting date.
Their measurement also reflects the manner in which management expects to recover or settle the
carrying amount of the related asset or liability.
Deferred tax assets relating to temporary differences and unused tax losses are recognised only to the
extent that it is probable that future taxable profit will be available against which the benefits of the
deferred tax asset can be utilised.
Where temporary differences exist in relation to investments in subsidiaries, branches, associates, and
joint ventures, deferred tax assets and liabilities are not recognised where the timing of the reversal of
the temporary difference can be controlled and it is not probable that the reversal will occur in the
foreseeable future.
Current tax assets and liabilities are offset where a legally enforceable right of set-off exists and it is
intended that net settlement or simultaneous realisation and settlement of the respective asset and
liability will occur. Deferred tax assets and liabilities are offset where a legally enforceable right of set-off
exists, the deferred tax assets and liabilities relate to income taxes levied by the same taxation
authority on either the same taxable entity or different taxable entities where it is intended that net
settlement or simultaneous realisation and settlement of the respective asset and liability will occur in
future periods in which significant amounts of deferred tax assets or liabilities are expected to be
recovered or settled.
Where the Group receives the Australian Government’s Research and Development Tax Incentive, The
Group accounts for the refundable tax offset under AASB 112. Funds are received as a rebate through
the parent company’s income tax return and disclosed as such in Note 6 Income tax.
d. Plant and equipment
i. Recognition and measurement
Each class of plant and equipment is measured at cost or fair value less, where applicable, any
accumulated depreciation and 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 that will be received from the assets employment and
subsequent disposal. The expected net cash flows have not been discounted to their present
values in determining recoverable amounts.
Items of property, plant and equipment are measured at cost less accumulated depreciation (see
below) and impairment losses (see Note 2l Impairment of non- financial assets and Note 2b
Exploration and development expenditure).
ii. Depreciation
The depreciable amount of all fixed assets including building and capitalised lease assets, but
excluding freehold land, is depreciated on a straight-line basis over their useful lives to the
Consolidated Group commencing from the time the asset is held ready for use. Leasehold
improvements are depreciated over the shorter of either the unexpired period of the lease or the
estimated useful lives of the improvements.
The depreciation rates used for each class of depreciable assets are:
Plant and equipment
Computers
20.00%
33.00%
Page 29
NOTES TO THE FINANCIAL STATEMENTS
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the end of
each reporting period. 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 re-valued
assets are sold, amounts included in the revaluation reserve relating to that asset are transferred
to retained earnings
e. Employee benefits
For the period ending 30 June 2019 the Company has three employees.
i. Defined contribution superannuation funds
A defined contribution plan is a post-employment benefit plan under which an entity pays fixed
contributions onto a separate entity and will have no legal or constructive obligation to pay further
amounts. Obligations for contributions to defined contribution superannuation funds are recognised
as an expense in the income statement as incurred. Prepaid contributions are recognised as an
asset to the extent that a cash refund or a reduction in future payments is available.
ii. Short-term benefits
Liabilities for employee benefits for wages, salaries and annual leave that are expected to be
settled within 12 months of the reporting date represent present obligations resulting from
employees’ services provided to the reporting date and are calculated at undiscounted amounts
based on remuneration wage and salary rates that the Company expects to pay at the reporting
date including related on-costs, such as workers compensation insurance and payroll tax.
Non-accumulating non-monetary benefits, such as medical care, housing, cars and free or
subsidised goods and services, are expensed based on the net marginal cost to the Company as
the benefits are taken by the employees.
iii. Other long-term benefits
Employee benefits payable later than one year have been measured at the present value of the
estimated future cash outflows to be made for those benefits.
f. Equity-settled compensation
The Group operates an employee share ownership scheme. Share-based payments to employees are
measured at the fair value of the instruments issued and amortised over the vesting periods. Share-
based payments to non-employees are measured at the fair value of goods or services received or the
fair value of the equity instruments issued, if it is determined the fair value of the goods or services
cannot be reliably measured and are recorded at the date the goods or services are received. The
corresponding amount is recorded to the option reserve. The fair value of options is determined using
the Black-Scholes pricing model. The number of shares and options expected to vest is reviewed and
adjusted at the end of each reporting period such that the amount recognised for services received as
consideration for the equity instruments granted is based on the number of equity instruments that
eventually vest.
g. Revenue and other income
Interest revenue is recognised on a proportional basis taking into account the interest rates applicable to
the financial assets.
Management fees are recognised on portion of completion basis.
Gain on disposal of tenements, and revenue from equipment chargebacks, are recognised on receipt
of compensation.
All revenue is stated net of the amount of value added taxes (see Note 2h Value-added taxes).
Page 30
NOTES TO THE FINANCIAL STATEMENTS
h. Value-added taxes
Value-added taxes (VAT) is the generic term for the broad-based consumption taxes that the Group is
exposed to such as: Australia (GST); Sweden (MOMS); and in Mauritanian (VAT).
Revenues, expenses, and assets are recognised net of the amount of VAT, except where the amount of
VAT incurred is not recoverable from the relevant country’s taxation authority. In these circumstances
the VAT is recognised as part of the cost of acquisition of the asset or as part of an item of the
expense. Receivables and payables in the statement of financial position are shown inclusive of VAT.
Cash flows are presented in the statement of cash flows on a gross basis, except for the VAT
component of investing and financing activities, which are disclosed as operating cash flows.
Commitments and contingencies are disclosed net of the amount of VAT recoverable from, or payable
to, the taxation authority.
i. Leases
Leases of fixed assets where substantially all the risks and benefits incidental to the ownership of the
asset, but not the legal ownership, are transferred to entities in the Group are classified as finance leases.
Leased assets are depreciated on a straight-line basis over their estimated useful lives where it is likely
that the Group will obtain ownership of the asset or over the term of the lease.
Lease payments for operating leases, where substantially all the risks and benefits remain with the
lessor, are charged as expenses in the periods in which they are incurred.
Lease incentives under operating leases are recognised as a liability and amortised on a straight-line
basis over the life of the lease term
j. Financial instruments
i.
Initial recognition and measurement
Financial instruments, incorporating financial assets and financial liabilities, are recognised when
the entity becomes a party to the contractual provisions of the instrument. Trade date accounting is
adopted for financial assets that are delivered within timeframes established by marketplace
convention.
Financial instruments are initially measured at fair value plus transactions costs where the
instrument is not classified as at fair value through profit or loss.
Transaction costs related to instruments classified as at fair value through profit or loss are
expensed to profit or loss immediately.
The Group does not designate any interests in subsidiaries, associates or joint venture entities as
being subject to the requirements of accounting standards specifically applicable to financial
instruments.
ii. Non-derivative financial instruments
Non-derivative financial instruments comprise investments in equity securities, trade and other
receivables, cash and cash equivalents and trade and other payables.
Non-derivative financial instruments are recognised initially at fair value plus, for instruments not at
fair value through profit or loss, any directly attributable transactions costs. Subsequent to initial
recognition non-derivative financial instruments are measured as described below.
iii. Classification and subsequent measurement
(1) Cash and cash equivalents
Cash and cash equivalents includes cash on hand, deposits held at call with banks, other short-
term highly liquid investments with original maturities of three months or less, and bank
Page 31
NOTES TO THE FINANCIAL STATEMENTS
overdrafts. Bank overdrafts are shown within short borrowings in current liabilities on the
Statement of financial position.
(2) Loans
Loans are non-derivative financial assets with fixed or determinable payments that are not quoted
in an active market and are subsequently measured at amortised cost. Gains or losses are
recognised in profit or loss through the amortisation process and when the financial asset is
derecognised.
Loans are included in current assets, except for those which are not expected to mature within 12
months after the end of the reporting period.
(3) Trade and other receivables
Trade and other receivables are stated at amortised cost. Receivables are usually settled within
30 to 90 days.
Collectability of trade and other debtors is reviewed on an ongoing basis. An impairment loss is
recognised for debts which are known to be uncollectible. An impairment provision is raised for
any doubtful amounts.
(4) Trade and other payables
Trade payables and other payable are recognised when the Group becomes obligated to make
future payments resulting from the purchase of goods and services which are unpaid and
stated at their amortised cost.
The amounts are unsecured and are generally settled on 30-day terms.
(5) Financial liabilities
Non-derivative financial liabilities (excluding financial guarantees) are subsequently measured
at amortised cost.
(6) Share capital
Ordinary issued capital is recorded at the consideration received. Incremental costs directly
attributable to the issue of ordinary shares and share options are recognised as a deduction
from equity, net of any related income tax benefit. Ordinary issued capital bears no special
terms or conditions affecting income or capital entitlements of the shareholders.
iv. Amortised cost
Amortised cost is calculated as the amount at which the financial asset or financial liability is
measured at initial recognition less principal repayments and any reduction for impairment and
adjusted for any cumulative amortisation of the difference between that initial amount and the
maturity amount calculated using the effective interest method.
v. Fair value
Fair value is determined based on current bid prices for all quoted investments. Valuation
techniques are applied to determine the fair value for all unlisted securities, including recent arm’s
length transactions, reference to similar instruments and option pricing models.
vi. Effective interest method
The effective interest method is used to allocate interest income or interest expense over the
relevant period and is equivalent to the rate that discounts estimated future cash payments or
receipts (including fees, transaction costs and other premiums or discounts) over the expected life
(or when this cannot be reliably predicted, the contractual term) of the financial instrument to the
net carrying amount of the financial asset or financial liability. Revisions to expected future net cash
flows will necessitate an adjustment to the carrying amount with a consequential recognition of an
income or expense item in profit or loss.
Page 32
NOTES TO THE FINANCIAL STATEMENTS
vii. Impairment
A financial asset is assessed at each reporting date to determine whether there is any objective
evidence that it is impaired. A financial asset is considered to be impaired if objective evidence
indicates that one or more events have had a negative effect on the estimated future cash flows of
that asset.
An impairment loss in respect of a financial asset measured at amortised cost is calculated as the
difference between its carrying amount, and the present value of the estimated future cash flows
discounted at the original effective interest rate.
Individually significant financial assets are tested for impairment on an individual basis. The
remaining financial assets are assessed collectively in Groups that share similar credit risk
characteristics.
All impairment losses are recognised in the income statement.
An impairment loss is reversed if the reversal can be related objectively to an event occurring after
the impairment loss was recognised. For financial assets measured at amortised cost the reversal
is recognised in the income statement.
viii. Derecognition
Financial assets are derecognised where the contractual rights to cash flow expires or the asset is
transferred to another party whereby the entity no longer has any significant continuing involvement
in the risks and benefits associated with the asset.
Financial liabilities are derecognised where the related obligations are either discharged, cancelled
or expired. The difference between the carrying value of the financial liability extinguished or
transferred to another party and the fair value of consideration paid, including the transfer of non-
cash assets or liabilities assumed, is recognised in profit or loss.
ix. Financial income and expenses
Finance income comprises interest income on funds invested (including available-for-sale financial
assets), gains on the disposal of available-for-sale financial assets and changes in the fair value of
financial assets at fair value through profit or loss. Interest income is recognised as it accrues in
profit or loss, using the effective interest method.
Financial expenses comprise interest expense on borrowings calculated using the effective interest
method, unwinding of discounts on provisions, changes in the fair value of financial assets at fair
value through profit or loss and impairment losses recognised on financial assets. All borrowing
costs are recognised in profit or loss using the effective interest method.
Borrowing costs directly attributable to the acquisition, construction or production of assets that
necessarily take a substantial period of time to prepare for their intended use or sale, are added to
the cost of those assets, until such time as the assets are substantially ready for their intended use
or sale. All other borrowing costs are recognised in income in the period in which they are incurred.
Foreign currency gains and losses are reported on a net basis.
k. Earnings per share
i. Basic earnings per share
Basic earnings (or loss) per share is determined by dividing the profit or loss attributable to equity
holders of the parent company, excluding any costs of service equity other than ordinary shares, by
the weighted average number of ordinary shares outstanding during the financial year, adjusted for
bonus elements in ordinary shares issued during the year.
ii. Diluted earnings per share
Diluted earnings (or loss) per share is determined by adjusting the profit or loss attributable to
ordinary shareholders and the weighted average number of ordinary shares outstanding for the
Page 33
NOTES TO THE FINANCIAL STATEMENTS
effects of all dilutive potential ordinary shares which comprise share options granted as share-
based payments.
The Group does not report diluted earnings per share, as dilution is not applied to annual losses
generated by the Group.
l.
Impairment of non-financial assets
The carrying amounts of the Company’s non-financial assets, other than deferred tax assets (Note 2c
Income tax) and exploration and evaluation assets (Note 2b Exploration and development expenditure)
are reviewed at each reporting date to determine whether there is any indication of impairment. If any
such indication exists then the asset’s recoverable amount is estimated.
An impairment loss is recognised if the carrying amount of an asset or its cash-generating unit exceeds
its recoverable amount. A cash-generating unit is the smallest identifiable asset Group that generates
cash flows that largely are independent from other assets and Groups. Impairment losses are
recognised in the income statement, unless the asset has previously been revalued, in which case the
impairment loss is recognised as a reversal to the extent of that previous revaluation with any excess
recognised through the income statement. Impairment losses recognised in respect of cash-generating
units are allocated first to reduce the carrying amount of any goodwill allocated to the units and then to
reduce the carrying amount of the other assets in the unit on a pro rata basis.
The recoverable amount of an asset or cash-generating unit is the greater of its fair value less costs to
sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their
present value using a pre-tax discount rate that reflects current market assessments of the time value
of money and the risks specific to the asset. For an asset that does not generate largely independent
cash inflows, the recoverable amount is determined for the cash- generating unit to which the asset
belongs.
Impairment losses recognised in prior periods are assessed at each reporting date for any indications
that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a
change in the estimates used to determine the recoverable amount. An impairment loss is reversed
only to the extent that the asset’s carrying amount does not exceed the carrying amount that would
have been determined, net of depreciation and amortisation, if no impairment loss had been
recognised.
m. Provisions
Provisions are recognised when the Group has a legal or constructive obligation, as a result of past
events, for which it is probable that an outflow of economic benefits will results and that outflow can be
reliably measured.
n. Foreign currency transactions and balances
i. Functional and presentation currency
The functional currency of each of the Group’s entities is measured using the currency of the
primary economic environment in which that entity operates. The consolidated financial statements
are presented in Australian dollars which is the parent entity’s functional and presentation currency.
ii. Transaction and balances
Foreign currency transactions are translated into functional currency using the exchange rates
prevailing at the date of the transaction. Foreign currency monetary items are translated at the
year- end exchange rate. Non-monetary items measured at historical cost continue to be carried at
the exchange rate at the date of the transaction. Non-monetary items measured at fair value are
reported at the exchange rate at the date when fair values were determined.
Exchange differences arising on the translation of monetary items are recognised in the profit or
loss except where deferred in equity as a qualifying cash flow or net investment hedge.
Page 34
NOTES TO THE FINANCIAL STATEMENTS
Exchange differences arising on the translation of non-monetary items are recognised directly in
other comprehensive income to the extent that the gain or loss is directly recognised in other
comprehensive income, otherwise the exchange difference is recognised in the profit or loss.
iii. Group entities
The financial results and position of foreign operations whose functional currency is different from
the Group’s presentation currency are translated as follows:
Assets and liabilities are translated at year-end exchange rates prevailing at that reporting date.
Income and expenses are translated at average exchange rates for the period.
Retained earnings are translated at the exchange rates prevailing at the date of the transaction.
Exchange differences arising on translation of foreign operations are transferred directly to the
Group’s foreign currency translation reserve in the statement of financial position. These differences
are recognised in the profit or loss in the period in which the operation is disposed.
o. Fair value estimation
A number of the Group’s accounting policies and disclosures require the determination of fair value, for
both financial and non-financial assets and liabilities. Information about the assumptions made in
determining fair values of assets and liabilities is disclosed in the notes specific to that asset or
liability.
p. Fair value of assets and liabilities
The Group measures some of its assets and liabilities at fair value on either a recurring or non-
recurring basis, depending on the requirements of the applicable Accounting Standard.
Fair value is the price the Group would receive to sell an asset or would have to pay to transfer a
liability in an orderly (i.e. unforced) transaction between independent, knowledgeable and willing market
participants at the measurement date.
As fair value is a market-based measure, the closest equivalent observable market pricing information
is used to determine fair value. Adjustments to market values may be made having regard to the
characteristics of the specific asset or liability. The fair values of assets and liabilities that are not
traded in an active market are determined using one or more valuation techniques. These valuation
techniques maximise, to the extent possible, the use of observable market data.
To the extent possible, market information is extracted from either the principal market for the asset or
liability (i.e. the market with the greatest volume and level of activity for the asset or liability) or, in the
absence of such a market, the most advantageous market available to the entity at the end of the
reporting period (i.e. the market that maximises the receipts from the sale of the asset or minimises the
payments made to transfer the liability, after taking into account transaction costs and transport costs).
For non-financial assets, the fair value measurement also takes into account a market participant’s
ability to use the asset in its highest and best use or to sell it to another market participant that would
use the asset in its highest and best use.
The fair value of liabilities and the entity’s own equity instruments (excluding those related to share-
based payment arrangements) may be valued, where there is no observable market price in relation to
the transfer of such financial instruments, by reference to observable market information where such
instruments are held as assets. Where this information is not available, other valuation techniques are
adopted and, where significant, are detailed in the respective note to the financial statements.
i. Valuation techniques
In the absence of an active market for an identical asset or liability, the Group selects and uses
one or more valuation techniques to measure the fair value of the asset or liability, the Group
selects a valuation technique that is appropriate in the circumstances and for which sufficient data
Page 35
NOTES TO THE FINANCIAL STATEMENTS
is available to measure fair value. The availability of sufficient and relevant data primarily depends
on the specific characteristics of the asset or liability being measured. The valuation techniques
selected by the Group are consistent with one or more of the following valuation approaches:
(1) Market approach: valuation techniques that use prices and other relevant information generated
by market transactions for identical or similar assets or liabilities.
(2) Income approach: valuation techniques that convert estimated future cash flows or income and
expenses into a single discounted present value.
(3) Cost approach: valuation techniques that reflect the current replacement cost of an asset at its
current service capacity.
Each valuation technique requires inputs that reflect the assumptions that buyers and sellers would
use when pricing the asset or liability, including assumptions about risks. When selecting a
valuation technique, the Group gives priority to those techniques that maximise the use of
observable inputs and minimise the use of unobservable inputs. Inputs that are developed using
market data (such as publicly available information on actual transactions) and reflect the
assumptions that buyers and sellers would generally use when pricing the asset or liability are
considered observable, whereas inputs for which market data is not available and therefore are
developed using the best information available about such assumptions are considered
unobservable
ii. Fair value hierarchy
AASB 13 requires the disclosure of fair value information by level of the fair value hierarchy, which
categorises fair value measurements into one of three possible levels based on the lowest level that an
input that is significant to the measurement can be categorised into as follows:
(1) Level 1
Measurements based on quoted prices (unadjusted) in active markets for identical assets or
liabilities that the entity can access at the measurement date.
(2) Level 2
Measurements based on inputs other than quoted prices included in Level 1 that are observable for
the asset or liability, either directly or indirectly.
(3) Level 3
Measurements based on unobservable inputs for the asset or liability.
The fair values of assets and liabilities that are not traded in an active market are determined using
one or more valuation techniques. These valuation techniques maximise, to the extent possible, the
use of observable market data. If all significant inputs required to measure fair value are observable,
the asset or liability is included in Level 2. If one or more significant inputs are not based on
observable market data, the asset or liability is included in Level 3.
The Group would change the categorisation within the fair value hierarchy only in the following
circumstances:
•
•
if a market that was previously considered active (Level 1) became inactive (Level 2 or Level 3) or
vice versa or
if significant inputs that were previously unobservable (Level 3) became observable (Level 2) or vice
versa.
When a change in the categorisation occurs, the Group recognises transfers between levels of the fair
value hierarchy (i.e. transfers into and out of each level of the fair value hierarchy) on the date the event
or change in circumstances occurred.
Page 36
NOTES TO THE FINANCIAL STATEMENTS
q. Critical accounting estimates and judgements
The directors evaluate estimates and judgements incorporated into the financial report based on
historical knowledge and best available current information.
Estimates assume a reasonable expectation of future events and are based on current trends and
economic data, obtained both externally and within the Group.
i. Key Judgements – Exploration and evaluation expenditure
Exploration and evaluation costs are carried forward where right of tenure of the area of interest is
current. These costs are carried forward in respect of an area that has not at reporting date
reached a stage that permits reasonable assessment of the existence of economically recoverable
reserves, refer to the accounting policy stated in Note 2b Exploration and development expenditure.
The carrying value of capitalised expenditure at reporting date is $21,008,293 (2018: $17,687,868).
During the financial year, the Group undertook assessment of its tenement assets, as a result of
this assessment, the Group decided to impair some of its exploration assets. Refer to Note 13
Exploration and evaluation assets.
ii. Key Judgements – Environmental issues
Balances disclosed in the financial statements and notes thereto are not adjusted for any pending
or enacted environmental legislation, and the directors understanding thereof. At the current stage
of the Company’s development and its current environmental impact, the directors believe such
treatment is reasonable and appropriate.
iii. Key Estimate – Taxation
Balances disclosed in the financial statements and the notes thereto, related to taxation, are based
on the best estimates of directors. These estimates take into account both the financial performance
and position of the Company as they pertain to current income taxation legislation, and the
directors understanding thereof.
No adjustment has been made for pending or future taxation legislation. The current income tax
position represents that directors’ best estimate, pending an assessment by tax authorities in
relevant jurisdictions. Refer to Note 6 Income tax.
iv. Key Estimate — Impairment
The Group assesses impairment at each reporting date by evaluating conditions specific to the
Group that may lead to impairment of assets. Where an impairment trigger exists, the recoverable
amount of the asset is determined.
v. Key Estimate – Share-based payments
The Group measures the cost of equity-settled transactions with employees by reference to the fair
value of the equity instruments at the date at which they are granted. The fair value is determined
by an internal valuation using a Black-Scholes option pricing model, using the assumptions detailed
in Note 28 Share-based payments
r. New standards, interpretations and amendments adopted by the Group
A number of new standards, amendments to standards and interpretations issued by the AASB which
are not yet mandatorily applicable to the Group have not been applied in preparing these financial
statements. Those which may be relevant to the Group are set out below. The Group does not plan to
adopt these standards early
i. AASB 16: Leases (applicable to annual reporting periods commencing on or after 1 January 2019).
AASB 16 removes the classification of leases as either operating leases or finance leases for the
lessee effectively treating all leases as finance leases. Short term leases (less than 12 months)
and leases of a low value are exempt from the lease accounting requirements. Lessor accounting
remains similar to current practice.
Page 37
NOTES TO THE FINANCIAL STATEMENTS
The Directors has have still assessing the likely impact.
ii. AASB 2016-1 Amendments to Australian Accounting Standards – Recognition of Deferred Tax
Assets for Unrealised Losses
The amendments clarify that an entity needs to consider whether tax law restricts the sources of
taxable profits against which it may make deductions on the reversal of deductible temporary
difference related to unrealised losses.
Furthermore, the amendments provide guidance on how an entity should determine future taxable
profits and explain the circumstances in which taxable profit may include the recovery of some
assets for more than their carrying amount. The Group applied amendments retrospectively.
However, their application has no effect on the Group’s financial position and performance as the
Group has no deductible temporary differences or assets that are in the scope of the amendments.
iii. AASB 2016-2 Amendments to Australian Accounting Standards – Disclosure Initiative: Amendments
to AASB 107
The amendments require entities to provide disclosure of changes in their liabilities arising from
financing activities, including both changes arising from cash flows and non-cash changes (such as
foreign exchange gains or losses).
However, their application has no effect on the Group’s financial position and performance as the
Group has no deductible temporary differences or assets that are in the scope of the amendments.
iv. AASB 2017-2 Amendments to Australian Accounting Standards – Further Annual Improvements
2014-2016 Cycle
The amendments clarify that the disclosure requirements in AASB 12, other than those in paragraphs
B10–B16, apply to an entity’s interest in a subsidiary, a joint venture or an associate (or a portion of
its interest in a joint venture or an associate) that is classified (or included in a disposal group that is
classified) as held for sale.
However, their application has no effect on the Group’s financial position and performance as the
Group has no deductible temporary differences or assets that are in the scope of the amendments
Note 3
Financial risk management
i. Financial risk management objectives and policies
The Group’s principal financial instruments comprise of cash and short-term deposits and other
financial assets.
The main purpose of these financial instruments is to invest funds raised by the Group until utilised
in exploration activities.
The Group has other financial instruments such as current receivables and payables arising from
corporate activities.
The main risks arising from the Group’s financial instruments are interest rate risk, foreign currency
risk, credit risk and liquidity risk. The Chief Financial Officer is responsible for the management of
the Group’s financial risk. The Chief Financial Officer updates the board of directors regularly on
financial risk management measures that he implements.
Page 38
NOTES TO THE FINANCIAL STATEMENTS
Floating
Interest
Rate
Fixed
Interest
Rate
Non-interest
Bearing
Total
For the Financial Year Ended 30 June 2019
812,296
-
-
812,296
-
-
812,296
-
-
-
-
-
-
-
-
37,294
57,710
95,004
(464,959)
-
(369,955)
812,296
37,294
57,710
907,300
(464,959)
-
442,341
For the Financial Year Ended 30 June 2018
Floating
Interest
Rate
Fixed
Interest
Rate
Non-interest
Bearing
Total
2,844,169
-
-
2,844,169
-
-
2,844,169
-
-
-
-
-
-
-
-
23,881
60,926
84,807
(303,133)
-
(218,326)
2,844,169
23,881
60,926
2,928,976
(303,133)
-
2,625,843
Financial assets
Cash and cash equivalents
Receivables
Other current assets
Financial liabilities
Payables
Other payables
Net maturity
Financial assets
Cash and cash equivalents
Receivables
Other current assets
Financial liabilities
Payables
Other payables
Net maturity
ii. Specific financial risk exposures and management
The main risk the Group is exposed to through its financial instruments are credit risk, liquidity risk and
market risk consisting of interest rate, foreign currency risk and equity price risk.
The board of directors has overall responsibility for the establishment and oversight of the risk
management framework. The board of directors has adopted practices designed to identify significant
areas of business risk and to effectively manage those risks in accordance with the risk profile. This
includes assessing, monitoring and managing risks for the Group and setting appropriate risk limits and
controls. The Group is not of a size nor is its affairs of such complexity to justify the establishment of a
formal system for risk management and associated controls. Instead, the Board approves all
expenditure, is intimately acquainted with all operations and discuss all relevant issues at the Board
meetings. The operational and other compliance risk management have also been assessed and
found to be operating efficiently and effectively.
Credit risk
Exposure to credit risk relating to financial assets arises from the potential non-performance by
counterparties of contract obligations that could lead to a financial loss to the Group
The Group does not have any material credit risk exposure to any single receivable or Group of
receivables under financial instruments entered into by the Group.
Credit risk exposures
The maximum exposure to credit risk is that to its alliance partners and that is limited to the carrying
amount, net of any provisions for impairment of those assets, as disclosed in the statement of financial
position and notes to the financial statements.
Credit risk related to balances with banks and other financial institutions is managed by the Group in
accordance with approved Board policy. Such policy requires that surplus funds are only invested with
financial institutions residing in Australia, where ever possible.
Page 39
NOTES TO THE FINANCIAL STATEMENTS
Impairment losses
Group’s financial assets that are past due total $nil (2018: $nil).
There has been no allowance for impairment in respect of the financial assets of the Group during
this year.
Liquidity risk
Liquidity risk arises from the possibility that the Group might encounter difficulty in settling its debts or
otherwise meeting its obligations related to financial liabilities.
The Group manages liquidity risk by continuously monitoring forecast and actual cash flows and
ensuring sufficient cash and marketable securities are available to meet the current and future
commitments of the Group. Due to the nature of the Group’s activities, being mineral exploration, the
Group does not have ready access to credit facilities, with the primary source of funding being equity
raisings. The board of directors constantly monitor the state of equity markets in conjunction with the
Group’s current and future funding requirements, with a view to initiating appropriate capital raisings as
required. Any surplus funds are invested with major financial institutions.
The financial liabilities of the Group are confined to trade and other payables as disclosed in the
statement of financial position. All trade and other payables are non-interest bearing and due within 30
days of the reporting date.
Market risk
Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and
equity prices will affect the Group’s income or the value of its holdings of financial instruments. The
objective of market risk management is to manage and control market risk exposures within acceptable
parameters, while optimising the return.
The Board meets on a regular basis and considers the Group’s exposure currency and interest rate
risk.
(1) Interest rate risk
Exposure to interest rate risk arises on financial assets and financial liabilities recognised at the end
of the reporting period whereby a future change in interest rates will affect future cash flows or the
fair value of fixed rate financial instruments. The Group is also exposed to earnings volatility on
floating rate instruments.
Interest rate risk is not material to the Group as no debt arrangements have been entered into, and
movement in interest rates on the Group’s financial assets is not material.
(2) Foreign exchange risk
Exposure to foreign exchange risk may result in the fair value or future cash flows of a financial
instrument fluctuating due to movement in foreign exchange rates of currencies in which the Group
holds financial instruments which are other than the Australian dollars functional currency of the
Group.
With instruments being held by overseas operations, fluctuations in foreign currencies may impact
on the Group’s financial results. The Group’s exposure to foreign exchange risk is minimal;
however, the Board continues to review this exposure regularly.
(3) Price risk
Price risk relates to the risk that the fair value or future cash flows of a financial instrument will
fluctuate because of changes in market prices.
The Group is exposed to securities price risk on investments held for trading or for medium to
longer terms.
Page 40
NOTES TO THE FINANCIAL STATEMENTS
The investment in listed equities has been valued at the market price prevailing at balance date.
Management of this investment’s price risk is by ongoing monitoring of the value with respect to any
impairment.
iii. Sensitivity analysis
Interest rate risk
The Group is exposed to market interest rates on moneys it has deposited with Australian banking
institutions in form of short-term deposits.
At the end of the financial period, the Group had the following financial assets exposed to
Australian variable interest rate risk:
The main risks arising from the Group’s financial instruments are interest rate risk, foreign currency
risk, credit risk and liquidity risk. The Chief Financial Officer is responsible for the management of
the Group’s financial risk. The Chief Financial Officer updates the board of directors regularly on
financial risk management measures that he implements.
30 June
2019
$
2018
$
Cash and cash equivalents
812,296
2,844,169
At the end of the financial period, the Group had no financial liabilities exposed to variable interest
rate risks.
The Group’s cash management policy is to invest surplus funds at the best available rate received
from the Commonwealth Bank of Australia.
Set out below is a sensitivity analysis of the financial implications of interest rate risk exposure as at
the end of the financial year. If interest rates had moved, with all other variables constant, profit
after tax and equity would have been:
Profit after tax
Higher/(lower)
+1% (100 basis points)
-1% (100 basis points)
Equity
Higher/(lower)
+1% (100 basis points)
-1% (100 basis points)
30 June
2019
$
2018
$
2,031
(2,031)
10,938
(10,938)
2,031
(2,031)
10,938
(10,938)
The movement in equity is directly linked to the movement in the Statement of Comprehensive
Income as the Group does not undertake any interest rate hedging.
Foreign currency risk
The Group has exposure to foreign currency risk in relation to US dollars for assets the Group holds in
Mauritania. The following table illustrates sensitivities to the Group’s exposures to changes in the
AUD/USD exchange rate. The table indicates the impact on how profit and equity values reported at
balance sheet date would have been affected by changes in the relevant risk variable that management
considers to be reasonably possible. These sensitivities assume that the movement in a particular
variable is independent of other variables.
Page 41
NOTES TO THE FINANCIAL STATEMENTS
The table below sets out the financial impact of the strengthening or weakening of the Australian
dollar against the US dollar on a profit after tax and equity basis as at the end of the financial year,
with all other variables constant:
Profit after tax
Higher/(lower)
+10% AUD/SEK exchange rate
-10% AUD/SEK exchange rate
Equity
Higher/(lower)
+10% AUD/SEK exchange rate
-10% AUD/SEK exchange rate
Profit after tax
Higher/(lower)
+10% AUD/USD exchange rate
-10% AUD/USD exchange rate
Equity
Higher/(lower)
+10% AUD/USD exchange rate
-10% AUD/USD exchange rate
30 June
2019
$
2018
$
-
-
-
-
100,068
(122,305)
92,822
(45,855)
-
-
-
-
197,110
(240,912)
151,041
(540,863)
At balance date, the Group does not hold financial instruments that would give rise to price risk
iv. Fair values
The fair values of financial assets and financial liabilities are presented in the table below and can be
compared to their carrying values as presented in the statement of financial position. Fair values are
those amounts at which an asset could be exchanged, or a liability settled, between knowledgeable,
willing parties in an arm’s length transaction.
Cash and cash equivalents, trade and other receivables, and trade and other payables are short-term
investments in nature whose carrying value is equivalent to fair value.
The methods and assumptions used in determining the fair values of financial instruments are
disclosed in the accounting policy notes specific to the asset or liability.
Page 42
NOTES TO THE FINANCIAL STATEMENTS
v. Financial asset and liability maturity
Year ended 30 June 2019
0-30
Days
31-60
Days
61-90
Days
91-180
Days
Total
Financial assets
Cash and cash equivalents
Receivables
Other current assets
Financial liabilities
Payables
Net maturity
812,296
37,294
57,710
907,300
(464,959)
442,341
-
-
-
-
-
-
Year ended 30 June 2018
0-30
Days
31-60
Days
61-90
Days
Financial assets
Cash and cash equivalents
Receivables
Other current assets
Financial liabilities
Payables
Net maturity
2,844,169
23,881
60,926
2,928,976
(303,133)
2,625,843
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
91-180
Days
-
-
-
-
-
-
-
-
-
-
-
-
812,296
37,294
57,710
907,300
(464,959)
442,341
Total
2,844,169
23,881
60,926
2,928,976
(303,133)
2,625,843
Note 4
Segment reporting
i.
Identification of reportable segments
The Group operates predominantly in the mining industry. This comprises exploration and evaluation
of uranium projects. Inter- segment transactions are priced at cost to the Consolidated Group.
The Group has identified its operating segments based on the internal reports that are provided to the
Board of Directors on a monthly basis. Management has identified the operating segments based on
the three principal projects – uranium, vanadium and gold and base metals. The Group also
maintains a corporate function primarily responsible for overall management of the operating
segments, raising capital and distributing funds to operating segments.
Corporate expenses include administration and regulatory expenses arising from operating an
ASX listed entity.
Segment assets include the costs to acquire tenements and the capitalised exploration costs of those
tenements Financial assets including cash and cash equivalents, and investments in financial assets,
are reported in the Treasury segment.
ii. Basis of accounting for purposes of reporting by operating segments
(1) Accounting policies adopted
Unless stated otherwise, all amounts reported to the board of directors, being the chief decision
maker with respect to operating segments, are determined in accordance with accounting policies
that are consistent to those adopted in the annual financial statements of the Group.
(2) Inter-segment transactions
An internally determined transfer price is set for all inter-segment sales. This price is reset quarterly
and is based on what would be realised in the event the sale was made to an external party at arm’s
length. All such transactions are eliminated on consolidation of the Group’s financial statements.
Page 43
NOTES TO THE FINANCIAL STATEMENTS
Corporate charges are allocated to reporting segments based on the segments’ overall proportion
of revenue generation within the Group. The board of directors believes this is representative of
likely consumption of head office expenditure that should be used in assessing segment
performance and cost recoveries.
Inter-segment loans payable and receivable are initially recognised at the consideration
received/to be received net of transaction costs. If inter-segment loans receivable and payable
are not on commercial terms, these are not adjusted to fair value based on market interest rates.
This policy represents a departure from that applied to the statutory financial statements.
(3) Segment assets
Where an asset is used across multiple segments, the asset is allocated to that segment that
receives majority economic value from that asset. In the majority of instances, segment assets are
clearly identifiable on the basis of their nature and physical location.
(4) Segment liabilities
Liabilities are allocated to segments where there is a direct nexus between the incurrence of the
liability and the operations of the segment. Borrowings and tax liabilities are generally considered
to relate to the Group as a whole and are not allocated. Segment liabilities include trade and
other payables and certain direct borrowings.
(5) Unallocated items
The following items of revenue, expenses, assets and liabilities are not allocated to operating
segments as they are not considered part of the core operations of any segment:
• Non-exploration impairment of assets and other non-recurring items of revenue or expense
•
Income tax expense
• Deferred tax assets and liabilities
• Current tax liabilities
• Other financial liabilities
Page 44
For the year ended 30 June 2019
Segment revenue
Segment result
Amounts not included in segment results but reviewed by the board:
Expenses not directly allocable to identifiable segments
Accounting and audit fees
Depreciation
Employee expense benefits expense
Exchange fluctuation
Exploration expenditure related to project generation
Finance costs
Insurances
Consulting and advisory fees
Rent and utilities
Share-based payments
Secretarial costs
Travel and accommodation
Other expenses
R&D Tax rebate
Loss after income tax
As at 30 June 2019
Segment assets
Unallocated assets
Trade and other receivables
Plant and equipment
Total Assets
Segment asset increases for the period:
Capital expenditure
Impairment of exploration assets
Segment liabilities
Unallocated liabilities
Trade and other payables
Provisions
Convertible notes
Financial liabilities
NOTES TO THE FINANCIAL STATEMENTS
Uranium
$
Vanadium
$
Gold and Base
Metals
$
Corporate
$
Total
$
-
-
-
(383,650)
-
-
32,293
32,293
32,293
(351,357)
(80,600)
(7,660)
(895,326)
30,327
(35,635)
(149,067)
(58,590)
(487,551)
(68,229)
(530,832)
(189,874)
(70,707)
(43,843)
42,682
(2,896,262)
13,786,983
6,860,687
494,587
702,746
21,845,003
2,168,212
-
2,168,212
1,100,746
(179,152)
921,594
258,787
-
258,787
152,701
53,450
71,295
-
-
-
-
Page 45
70,590
4,064
21,919,657
3,527,745
(179,152)
3,348,593
277,446
258,808
78,840
1,388,431
266,667
For the year ended 30 June 2018
Uranium
$
Vanadium
$
Corporate
$
Total
$
Segment revenue
Segment result
-
-
-
(14,328)
6,838
6,838
6,838
(7,490)
NOTES TO THE FINANCIAL STATEMENTS
Amounts not included in segment results but reviewed by the boards:
Expenses not directly allocable to identifiable segments
Accounting and audit fees
Depreciation
Employee expense benefits expense
Exchange fluctuation
Insurances
Consulting and advisory fees
Rent and utilities
Share-based payments
Secretarial costs
Travel and accommodation
Other expenses
Loss after income tax
As at 30 June 2018
Segment assets
Unallocated
Trade and other receivables
Plant and equipment
Total Assets
Segment asset increases for the period:
Capital expenditure
Impairment of exploration assets
Segment liabilities
Unallocated liabilities
Trade and other payables
Provisions
Total liabilities
(144,541)
(12,377)
(651,703)
(90,145)
(42,378)
(375,358)
(64,299)
(297,916)
(160,433)
(72,622)
(67,795)
(1,987,057)
11,940,312
5,747,556
2,844,169
20,532,037
2,625,573
-
2,625,573
286,805
-
286,805
98,783
31,360
-
-
-
-
84,807
8,124
20,624,968
2,912,378
-
2,912,378
130,143
172,990
28,405
331,538
Page 46
Note 5
Total revenue and other income
Other income
Other income
Interest on short-term deposits
Note 6
Income tax
NOTES TO THE FINANCIAL STATEMENTS
30 June
2019
$
2018
$
23,357
8,936
32,293
-
6,838
6,838
30 June
2019
$
2018
$
Income tax expense (benefit)
Current tax
Deferred tax
Tax rebate for research and development
Deferred income tax expense included in income
tax expense comprises
Increase/(decrease) in deferred tax assets
(increase)/decrease in deferred tax liabilities
-
-
42,682
42,682
-
-
-
-
-
-
-
-
-
-
Reconciliation of income tax expense to
prima facie tax payable
Accounting profit/(loss)
At the statutory income tax rate
applicable to the Company 27.5%
Tax losses for the current year for which
no deferred tax asset is recognised
Equity raising costs
Finance costs
Impairment of exploration expenditure previously
capitalised
Share-based payments
Other
Income tax (expense)/benefit
less rebates:
Tax rebate for research and development
Income tax expense/(benefit)
30 June
2019
$
2018
$
(2,938,944)
(1,987,057)
808,210
546,441
602,072
(27,500)
36,932
49,267
145,979
1,460
-
(42,682)
(42,682)
464,418
(37,500)
-
-
92,479
27,044
-
-
-
The applicable weighted average effective tax rates attributable to operating profit for the financial
year was Nil (2018: Nil).
The balance of the franking account at the end of the financial year was Nil (2018: Nil)
Page 47
NOTES TO THE FINANCIAL STATEMENTS
Deferred tax assets
Tax losses
Provisions and accruals
Other
Set-off deferred tax liabilities
Net deferred tax assets
less Deferred tax assets not recognised
Net tax assets
Deferred tax liabilities
Exploration expenditure
Set-off deferred tax assets
net deferred tax liabilities
Tax losses
Unused tax losses for which no deferred tax
asset has been recognised that may be utilised
to offseet tax liabilities:
Revenue losses
capital losses
30 June
2019
$
2018
$
5,270,331
(12,467)
(12,404)
5,245,460
-
5,245,460
(5,245,460)
-
4,697,290
(7,066)
(57,797)
4,632,427
-
4,632,427
(4,632,427)
-
-
-
-
-
-
-
17,450,851
2,083,905
19,534,756
15,935,730
2,083,905
18,019,635
Potential deferred tax assets attributable to tax losses and exploration expenditure carried forward
have not been brought to account at 30 June 2019 because the directors do not believe it is
appropriate to regard realisation of the deferred tax assets as probable at this point in time. These
benefits will only be obtained if:
i. The Group derives future assessable income of a nature and of an amount sufficient to enable
the benefit from the deductions for the loss and exploration expenditure to be realised.
ii. The group continues to comply with conditions for deductibility imposed by law,
iii. No changes in tax legislation adversely affect the Group in realising the benefits from the
deductions for the loss and exploration expenditure.
Page 48
Note 7
Earnings per share
NOTES TO THE FINANCIAL STATEMENTS
30 June
2019
$
2018
$
Loss from continuing operations for the year
(2,896,262)
(1,987,057)
Weighted average number of ordinary shares
outstanding during the year used in calculation of
basic EPS
Basic and diluted earnings per share (cents
per share)
No
No
1,109,267,274
865,506,202
(0.26)
(0.23)
Note 8
Dividends paid and proposed
No dividends were paid during the financial year and no dividend is proposed to be paid as at the
end of the financial year, 30 June 2019.
Note 9
Cash and cash equivalents
Cash at bank
Short-term deposits
30 June
2019
$
2018
$
812,296
-
812,296
2,529,005
315,164
2,844,169
The Group’s exposure to interest rate risk and a sensitivity analysis for financial assets and
liabilities are disclosed in Note 3 Financial Risk Management.
Note 10
Receivables-current
Value-added tax receivables
Other
31 December
2019
$
2018
$
37,294
-
37,294
23,221
660
23,881
Value-added tax is the generic ter, for broad-based consumption taxes that the Group is exposed
to in Australia (GST); Mauritania (VAT) and Sweden (MoMS).
The Group’s exposure to interest rate risk and a sensitivity analysis for financial assets and
liabilities are disclosed in Note 3 Financial Risk Management.
Receivables are non-interest bearing and are generally on 30 to 90-day terms.
Page 49
Note 11
Financial assets
NOTES TO THE FINANCIAL STATEMENTS
30 June
2019
$
2018
$
Bonds
57,710
60,926
On the grant by the Government of Mauritania of an exploration licence the Group is required to
provide a bank guarantee to the Government for the fulfilment of its proposed exploration
programme with the bond returned to the Group on relinquishment of the tenement or
transformation of the tenement into an exploitation licence.
Other bonds relate to leases of premises.
Note 12
Plant and equipment
Non-current
Plant and equipment
Accumulated depreciation
Movements in carrying amounts
Balance at the beginning of the year
Additions
Depreciation
Note 13
Exploration and evaluation
30 June
2019
$
2018
$
30,420
(26,356)
4,064
8,124
3,600
(7,660)
4,064
26,820
(18,696)
8,124
18,905
1,596
(12,377)
8,124
30 June
2019
$
2018
$
At start of financial year
Expenditure capitalised during the financial year
Effect of exchange rate changes on exploration
and evaluation assets
Impairment
At end of financial year
17,687,868
3,359,505
14,851,820
2,931,176
140,072
(179,152)
21,008,293
(95,128)
-
17,687,868
The carrying value of exploration and
evaluation expenditure at balance date is
represented by the following projects:
Tiris uranium
Haggan vanadium
Tasiast South gold
13,779,959
6,733,747
494,587
21,008,293
11,611,747
5,840,322
235,799
17,687,868
a. The value of the Group interest in exploration expenditure is dependent upon:
Page 50
NOTES TO THE FINANCIAL STATEMENTS
• The continuance of the Group’s rights to tenure of the areas of interest;
• The results of future exploration; and
• The recoupment of costs through successful development and exploitation of the areas of
interest, or alternatively, by their sale.
The Group’s exploration properties may be subjected to claim(s) under Native Title (or jurisdictional
equivalent), or contain sacred sites, or sites of significance to the indigenous people of Sweden and
Mauritania.
As a result, exploration properties or areas within the tenements may be subject to exploration
restrictions, mining restrictions and/or claims for compensation. At this time, it is not possible to quantify
whether such claims exist, or the quantum of such claims.
The Group lodged exploitation applications for Ain Seder, Oued El Foule Est and Oum Ferkik.
The Company received exploitation licences for the Ain Sder and Oued El Foule Est on 9 February
2019 by the government of its review of the applications. The Group is in discussions with the
government to secure an exclusivity over the Oum Ferkik tenement. The carrying value of the Oum
Ferkik tenement is $2.583 million.
Note 14
Payables-current
Trade payables
Accrued expenses
Other taxes payable
30 June
2019
$
2018
$
145,883
303,040
16,036
464,959
60,112
193,350
49,671
303,133
Trade payables are non-interest bearing and arise from the usual operating activities of the Group.
Trade and other payables are usually settled within the lower of terms or 30 days.
Due to the short-term nature of these payables, the carrying amounts recorded in the financial
statements for trade payables and other payables are the fair values.
The Group’s exposure to interest rate risk and a sensitivity analysis for financial assets and
liabilities are disclosed in Note 3 Financial Risk Management.
Note 15
Provisions-current
30 June
2019
$
2018
$
Employee benefits
63,499
28,405
Note 16
Financial liabilities
30 June
2019
$
2018
$
Conversion rights
266,667
-
Page 51
NOTES TO THE FINANCIAL STATEMENTS
On 30 April 2019, the Group entered into a Convertible Security Financing Agreement with Lind
Global Marco Fund LP. On applicable of AASB 9 Financial Instruments the Group accounted for
Convertible Security Financing on a present value basis and recognised the implicit value of
conversion rights granted to Lind Global Macro Fund LP.
The conversion rights will be recognised as equity on the extinguishment of the convertible note
facility.
Note 17
Vendor obligations
30 June
2019
$
2018
$
Vendors of Nomads Mining Company sarl
71,295
-
On 11 June 2018, the Group executed a Binding Term Sheet (see ASX Announcement, dated 11
June 2019) with the shareholders of Nomads Mining Company sarl, an entity incorporated in
Mauritania, to acquire a 70% equity interest in Nomads Mining Company sarl and on 26 June 2019
the Group and the shareholders of Nomads Mining Company sarl executed a Farm-in and Joint
Venture Agreement. Under the terms and conditions of the above agreement, the Group agreed to
the shareholders an entry fee of US$25,000 in cash and the Australian dollar equivalent of
US$25,000 in fully paid ordinary shares.
Nomads Mining Company sarl is the holder of Exploration Licence 2688 Nderik.
The Company extinguished its cash obligations of 4 July 2019 and share obligation on 12 July
2019.
Note 18
Borrowings
Convertible note
Current portion
Non-current portion
Opening balance
Notes issued
Conversion rights
Options over ordinary shares
Finance cost
Closing balance
Present value
Finance costs
2019
$
2018
$
694,215
694,216
1,388,431
-
2,000,000
(266,667)
(429,200)
84,298
1,388,431
1,388,431
1,011,569
2,400,000
-
-
-
-
-
-
-
-
-
-
-
On 30 April 2019, the Group entered into a convertible note agreement with Lind Global Macro
Fund, LLP (see ASX Announcement, dated 30 April 2019). Pursuant to the terms and conditions
the Group issued a convertible note with a face value of $2,400,000 to the Investor.
On 19 June 2019, the Company held a general meeting to seek approval for, amongst other
resolutions, the issuance of the Replacement Convertible Note to the Investor. All resolutions were
passed at the general meeting (see ASX Announcement, dated 20 June 2019).
Page 52
NOTES TO THE FINANCIAL STATEMENTS
Under the terms and conditions, Lind Global Macro Fund LP is entitled to convert a maximum of
$100,000 of convertible notes each month at 1.6 cents per share or 90% of the average 5 daily
VWAPs chosen by Lind from the daily VWAPs for the 20 trading Days immediately prior to the
conversion notice date.
The Group also issued Lind 50,000,000 Collateral Shares and 62,500,000 options over ordinary
shares. On the Group fulfilling its obligations under the convertible note and repaying the
convertible note in full by way of the issue of shares or payment of cash, Lind Global macro Fund
LP will transfer that number of Collateral Shares to the Group for no consideration to or at the
direction of the Company; or, subject to the shares trading on ASX on the relevant day and trading
for at least 5 trading days prior to payment, pay the Company in immediately available funds an
amount equal to the outstanding Collateral Shareholding number multiplied by the Collateralisation
Price.
The options over ordinary shares expire 3 years from the date of issue and have an exercise price
of 1.6 cents per option over ordinary share.
Since balance date, Lind Global Macro Fund LP has converted three tranches of convertible notes
into fully paid ordinary shares in Aura Energy Limited. Accordingly, the convertible note has been
reduced from $2,400,000 to $2,100,000 and Aura has issued 42,063,494 fully paid ordinary shares
(see ASX Announcements, dated 12 July 2019, 4 September 2019 and 25 September 2019).
Grant
date
Details
30/4/2019
Convertible Security
Funding Agreement
Share
Price @
date of
grant
(cents)
Exercise
Price
(cents)
Expected
Volatility
Expiry
Date
Risk-free
Interest
rate
Value/
option
Number/
options
1.6000
1.0000
100% 30/04/2022
1.75% 429,200 62,500,000
Note 19
Provisions-non-current
30 June
2019
$
2018
$
Employee benefits
15,341
-
Page 53
NOTES TO THE FINANCIAL STATEMENTS
Note 20
Contributed equity
a. Equity raised during the financial year
The Company has issued share capital amount
to 1,223,891,343 (2018: 1,069,390.795) fully paid
ordinary shares at no par value
Equity raised during the financial year
At the beginning of the reporting period
Shares issued during the year:
377,732 shares issued on 10 August 2017
550,034 shares issued on 10 August 2017
55,425,000 shares issued on 15 November 2017
400,000 shares issued on 15 November 2017
333,333 shares issued on 21 December 2017
2,653,934 shares issued on 21 December 2017
1,770,489 shares issued on 18 january 2018
6,000,000 shares issued on 30 January 2018
712,500 shares issued on 24 January 2018
1,333,333 shares issued on30 january 2018
84,052,630 shares issued on 5 April 2018
28,947,370 shares issued on 16 April 2018
7,000,000 shares issued on 1 May 2018
5,0000,000 shares issued on 15 May 2018
80,613,579 shares issued on 14 June 2018
1,394,737 shares issued on 14 June 2018
2,000,001 shares issued on 19 September 2018
1,441,425 shares issued on 19 September 2018
852,381 shares issued on 19 November 2018
17,500,000 shares issued on 4 January 2019
20,750,000 shares issued on 12 February 2019
4,687,500 shares issued on 25 February 2019
13,687,000 shares issued on 22 March 2019
26,890,922 shares issued on 22 April 2019
50,000,000 shares issued on 30 April 2019
4,600,229 shares issued on 22 May 2019
2,261,872 shares issued on 29 May 2019
9,828,718 shares issued on 29 May 2019
Transaction costs relating to share issues
At reporting date
a
b
c
d
e
f
g
h
i
j
k
l
m
n
o
p
q
r
s
t
u
v
w
x
y
z
aa
ab
30 June
2019
$
2018
$
46,315,108
44,698,295
44,698,295
39,558,943
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
40,000
33,081
16,707
385,000
332,000
75,000
219,000
322,691
-
63,483
21,777
108,116
1,616,855
-
1,616,855
46,315,150
13,375
13,375
1,108,500
8,000
6,666
54,140
42,492
150,000
14,250
26,667
1,597,000
550,000
175,000
125,000
1,532,000
26,500
-
-
-
-
-
-
-
-
-
-
-
-
5,442,965
(303,613)
5,139,352
44,698,295
Page 54
NOTES TO THE FINANCIAL STATEMENTS
Ordinary shares on issue at the start of the
financial year
Shares issued during the year
377,732 shares issued on 10 August 2017
550,034 shares issued on 10 August 2017
55,425,000 shares issued on 15 November 2017
400,000 shares issued on 15 November 2017
333,333 shares issued on 21 December 2017
2,653,934 shares issued on 21 December 2017
1,770,489 shares issued on 18 january 2018
6,000,000 shares issued on 30 January 2018
712,500 shares issued on 24 January 2018
1,333,333 shares issued on30 january 2018
84,052,630 shares issued on 5 April 2018
28,947,370 shares issued on 16 April 2018
7,000,000 shares issued on 1 May 2018
5,0000,000 shares issued on 15 May 2018
80,613,579 shares issued on 14 June 2018
1,394,737 shares issued on 14 June 2018
2,000,001 shares issued on 19 September 2018
1,441,425 shares issued on 19 September 2018
852,381 shares issued on 19 November 2018
17,500,000 shares issued on 4 January 2019
20,750,000 shares issued on 12 February 2019
4,687,500 shares issued on 25 February 2019
13,687,000 shares issued on 22 March 2019
26,890,922 shares issued on 22 April 2019
50,000,000 shares issued on 30 April 2019
4,600,229 shares issued on 22 May 2019
2,261,872 shares issued on 29 May 2019
9,828,718 shares issued on 29 May 2019
Ordinary shares on issue at the end of the
financial year
a
b
c
d
e
f
g
h
i
j
k
l
m
n
o
p
q
r
s
t
u
v
w
x
y
z
aa
ab
The details of each issue of shares are as follows:
30 June
2019
No
2018
No
1,069,390,795
792,808,124
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
377,732
550,034
55,425,000
400,000
333,333
2,653,934
1,770,489
6,000,000
712,500
1,333,333
84,052,630
28,947,370
7,000,000
5,000,000
80,631,579
1,394,737
2,000,001
1,441,425
852,381
17,500,000
20,750,000
4,687,500
13,687,500
26,890,922
50,000,000
4,600,229
2,261,872
9,828,718
-
-
-
-
-
-
-
-
-
-
-
-
154,500,548
276,582,671
1,223,891,343
1,069,390,795
Issue of shares to Executive Chairman pursuant to contract of employment
Issue of shares to Executive Chairman pursuant to contract of employment
a
b
c. Working capital raising
d
Issue of shares to a consultant pursuant to Letter of Engagement
e Exercise of options over ordinary shares (expiry 15 November 2018)
f
g
h Exercise of options over ordinary shares (expiry 5 February 2018)
i Exercise of options over ordinary shares (expiry 15 November 2018)
j Exercise of options over ordinary shares (expiry 15 November 2018)
k
Issue of shares for settlement of supplier obligations
Issue of shares for settlement of supplier obligations
Issue of shares pursuant to private placement
Page 55
NOTES TO THE FINANCIAL STATEMENTS
Issue of shares pursuant to private placement
issue of shares pursuant to private placement
Issue of shares to advisors pursuant to Letter of Engagement
l
m Exercise of options over ordinary shares (expiry 9 May 2018)
n Exercise of options over ordinary shares (expiry 9 May 2018)
o
p
q Exercise of options over ordinary shares (expiry 15 November 2018)
Issue of shares for settlement of supplier obligations
r
s
Issue of shares for settlement of supplier obligations
t Conversion of performance shares into ordinary shares
Issue of shares pursuant to private placement
u
Issue of shares pursuant to private placement
v
Issue of shares under terms and conditions of share purchase plan
w
Issue of shares for settlement of supplier obligations
x
Issue of collateral shares to Lind Global Macro Fund LP
y
z
Issue of shares for services under Letter of Engagement
aa Issue of shares for services under Letter of Engagement
ab Issue of shares pursuant to securing option of gold exploration licence in Mauritania
Ordinary shares
Ordinary shares have the rights to receive dividends as declared and, in the event of winding up,
participate in the proceeds from the sale of all surplus assets in proportion to the number of, and
amounts paid up on, the shares held.
Each fully paid ordinary share carries one vote.
Ordinary shares issued to shareholders since incorporation have had no par value.
Options over ordinary shares
There are no options over ordinary shares on issue.
Performance shares
At the general meeting of shareholders on the 30 November 2017, the Executive Chairman of the
Company was awarded 35,000,000 performance shares with 17,500,000 vesting on 30 November
2018 and the remainder on the 30 November 2019.
On 17 June 2018, Messrs NJ Clifford, WR Goodall and JM Madden were awarded 5,000,000
performance shares with 33.3% vesting on 17 June 2019, 33.3% vesting on 17 June 2020 and
33.4% vesting on 17 June 2021.
The group has accounted for the above-mentioned performance shares in accordance with AASB 2
Share-based payments.
b. Options over ordinary shares and performance shares on issue
For information relating to the Aura Energy Limited employee options scheme, including details of
options issued, issued and lapsed during the financial year, and the options outstanding at balance
date, refer to Note 28 Share-based payments. The total number of options and performance shares on
issue is as follows:
Performance shares
Unlisted options over ordinary shares
Unlisted warrants over ordinary shares
30 June
2019
$
2018
$
27,500,000
214,815,732
6,578,699
248,894,431
35,000,000
124,697,108
6,578,699
166,275,807
Page 56
NOTES TO THE FINANCIAL STATEMENTS
c. Capital management
i. Capital management policy
The directors’ objectives when managing capital are to ensure that the Group can fund its
operations and continue as a going concern, so that they may continue to provide returns for
shareholders and benefits for other stakeholders.
Due to the nature of the Group’s activities, being mineral exploration, the Group does not have
ready access to credit facilities, with the primary source of funding being equity raisings. Therefore,
the focus of the Group’s capital risk management is the current working capital position against the
requirements of the Group to meet exploration programmes and corporate overheads.
The Group’s strategy is to ensure appropriate liquidity is maintained to meet anticipated operating
requirements, with a view to initiating appropriate capital raisings as required.
ii. Current ratio
The current ratio the Group at 30 June 2019 and 30 June 2018 was as follows:
Current ratio
iii. Working capital position
Financial assets
Cash and cash equivalents
Receivables
Financial assets
Trade and other payables
Provisions
Vendor obligation
Working capital surplus/(deficit)
Note 21
Reserves
a. Share-based payments reserve
Opening balance
Issue of options
Issue of performance shares
Cancellation of options
Expiry of options
Conversion of performance shares
Closing balance
30 June
2019
$
2018
$
1.51
12.72
30 June
2019
$
2018
$
812,296
37,294
57,710
(464,959)
(63,499)
(71,295)
307,547
2,844,169
23,881
60,926
(303,133)
(28,405)
-
2,597,438
30 June
2019
$
2018
$
280,638
429,200
530,832
-
-
(385,000)
855,670
384,190
68,712
275,042
(334,684)
(112,622)
-
280,638
Page 57
NOTES TO THE FINANCIAL STATEMENTS
b. Translation
Opening balance
Translation of foreign currency financial
statements into the functional currency
Closing balance
Note 22
Accumulated losses
Balance at start of the financial period
Net loss for the year
Options cancelled during the year
Options expired during rhe year
Note 23
List of controlled entities
30 June
2019
$
2018
$
357,749
457,481
60,410
418,159
(99,732)
357,749
30 June
2019
$
2018
$
(25,043,252)
(2,896,262)
-
-
(27,939,514)
(23,503,501)
(1,987,057)
334,684
112,622
(25,043,252)
The financial statements include the financial statements of the parent entity and the controlled
entities listed in the following table:
Name
Country of
Incorporation
Vanadis Battery Metals AB
Sweden
Aura Energy Mauritania Pty Ltd
Tiris Ressources SA
Tiris International Mining Company
sarl
Australia
Mauritania
Mauritania
2019
100%
100%
85%
100%
2018
100%
100%
90%
100%
Page 58
NOTES TO THE FINANCIAL STATEMENTS
Note 24
Commitments
a. Exploration expenditure commitments
Exploration tenement minimum expenditure
677,084
915,322
109,139
311,804
256,141
677,084
263,835
420,943
230,544
915,322
Payable
not later than 12 months
between 12 months and 5 years
greayter than 5 years
The group does not have any expenditure
commitments under the terms and conditions of
the tenements it holds. The exploration
expenditure commitments relate to annual
renewal fees.
b. Operating lease commitments
Operating leases contracted for or committed to
but not capitalised in the financial statements
88,991
84,007
Payable
not later than 12 months
between 12 months and 5 years
greayter than 5 years
Note 25
Events after balance date
52,975
36,016
-
88,991
50,058
33,949
-
84,007
On 16 July 2019 (see ASX Announcement ,dated 16 July 2019), the Group issued to:
•
•
•
•
11,111,111 fully paid ordinary shares to Lind Global Macro Fund LP on receipt of its first
conversion notice pursuant to the terms and conditions of the Convertible Security Funding
Agreement. dated 30 April 2019. The value of the shares issued to Lind Global Macro Fund
LP was $100,000.
5,000,000 fully paid ordinary shares on the conversion of performance shares to Messrs NJ
Clifford and JM Madden and DR WR Goodall under the terms and conditions of the Long-
Term Incentive Plan. The value of the shares issued to management on conversion of
performance shares was $105,000.
3,251,773 fully paid ordinary to the shareholders of Nomads Mining Company Limited
pursuant to the first payment of the entry fee pursuant to the Farm-in and Joint Venture
Agreement, dated 26 June 2019. The value of the shares issued to the shareholders of
Nomads Mining Company sarl $36,127 (the equivalent of US$26,000).
1,893,233 fully paid ordinary shares to SD Capital Advisory Limited and GKB Ventures
Limited pursuant to the Letter of Engagement, dated 25 January 2019, for advisory services
associated with securing ECA financing. The value of the shares issued to SD Capital
Advisory Limited and GKB Ventures Limited was $21,564.
On 21 July 2019 (see ASX Announcement, dated 21 July 2019), the Group issued 15,430,919
loyalty options to shareholders that subscribed to the rights issue (see ASX Announcement 21
June 2019). The loyalty options expire on 21 July 2020 and are exercisable at 2.2 cents per option
over ordinary share. The loyalty options were issued at 0.5 cents per option over ordinary share
and raised $77,154.
Page 59
NOTES TO THE FINANCIAL STATEMENTS
On 25 July 2019 (see ASX Announcement, dated 25 July 2019), the Group released a cleansing
prospectus to enable the Group to issue a replacement convertible note to Lind Global Macro Fund
LP as required by the Convertible Security Funding Agreement (see ASX Announcement, dated 30
April 2019).
On 29 July 2019 (see ASX Announcement, dated 29 July 2019), the Group released to the market
the Tiris Uranium Project definitive feasibility study.
On 12 August 2019 (see ASX Announcement, dated 12 August 2019), the Group issued to
1,931,218 fully paid ordinary shares to SD Capital Advisory Limited and GKB Ventures Limited
pursuant to the Letter of Engagement, dated 25 January 2019, for advisory services associated
with securing ECA financing. The value of the shares issued to SD Capital Advisory Limited and
GKB Ventures Limited was $21,475.
On 14 August 2019 (see ASX Announcement, dated 14 August 2019), the Group release a revised
Mineral Resource estimate for its Haggan vanadium project.
On 6 September 2019 (see ASX Announcement, dated 6 September 2019), the Group issued to:
•
•
14,285,715 fully paid ordinary shares to Lind Global Macro Fund LP on receipt of its first
conversion notice pursuant to the terms and conditions of the Convertible Security Funding
Agreement. dated 30 April 2019. The value of the shares issued to Lind Global Macro Fund
LP was $100,000.
2,041,281 fully paid ordinary shares to SD Capital Advisory Limited and GKB Ventures
Limited pursuant to the Letter of Engagement, dated 25 January 2019, for advisory services
associated with securing ECA financing. The value of the shares issued to SD Capital
Advisory Limited and GKB Ventures Limited was $22,209.
On 19 September 2019, the Company and Lind Global Macro Fund LP executed an R&D Funding
Agreement whereby the Company received $250,000 to fund its research and development
activities and repay the R&D Funding by way of assigning its Tax Rebate.
On 25 September 2019 (see ASX Announcement, dated 25 September 2019), the Group issued to:
•
•
•
16,666,667 fully paid ordinary shares to Lind Global Macro Fund LP on receipt of its first
conversion notice pursuant to the terms and conditions of the Convertible Security Funding
Agreement. dated 30 April 2019. The value of the shares issued to Lind Global Macro Fund
LP was $100,000.
18,811,250 fully paid ordinary shares to Met Forages sarl under the terms and conditions of
a Drilling Settlement Agreement, dated 25 July 2019. The value of the shares issued to Met
Forages sarl was $150,490.
2,021,250 fully paid ordinary shares to WH Ireland Limited for advisory services. The value
of the shares issued to WH Ireland Limited was $16,170.
On 30 September 2019, the Company issued a supplementary prospectus to amend the terms and
conditions of the options over ordinary shares set out in its prospectus, dated 19 June 2019, in
relation to proposed listed options granted to subscribers to the Share Placement and Share
Purchase Plan. The Company simultaneously issued 11,604,181 unlisted options and 19,544,508
loyalty options over ordinary shares pursuant to the Share Placement and Share Purchase Plan.
Note 26
Related party disclosures
Directors
The directors of the parent entity during the financial period were:
Page 60
NOTES TO THE FINANCIAL STATEMENTS
PD Reeve
R Beeson
BF Fraser
JC Perkins
Transactions between related parties are on normal commercial terms and conditions no more
favourable than those available to other parties unless otherwise stated.
Other transactions with key management personnel are set out in the Remuneration Report. There
are no other related party transactions.
Note 27
Cash flow statement reconciliation
Net loss after tax
Adjusted for:
Depreciation
Exchange fluctuation
Exploration and evaluation expenditure
capitalised and included in operating cash flows
Finance costs
Impairment
Payments to employees and consultants by way
of the issue of shares
Provisions
Share-based payments
Changes in other current assets and current
liabilities
Current assets
Receivables
Current liabilities
Payables
Note 28
Share-based payments
Options over ordinary shares
Performance shares
Closing balance
30 June
2019
$
2018
$
(2,896,262)
(1,987,057)
7,660
(30,327)
12,377
90,145
(2,912,693)
134,298
179,152
(3,140,343)
-
.-
135,048
50,435
530,832
26,750
(90,543)
297,916
18,657
31,065
108,600
(4,674,600)
(115,800)
(4,875,490)
30 June
2019
$
2018
$
-
530,832
530,832
22,874
275,042
297,916
a. On 9 June 2015, shareholders approved the grant of 35,000,000 options over ordinary shares to Mr
PD Reeve pursuant to the Contract of Employment agreed between the Company and Mr PD Reeve on
9 February 2015. The unamortised cost of the options over ordinary shares was fully expensed during
the financial year as the arrangement between the Company and Mr PD Reeve was cancelled:
The following tranches set out the options over ordinary shares originally granted to the Executive
Chairman and Managing Director of the Company:
• 8,750,000 at an exercise price of $0.10 each. The options are exercisable on or before 9 June 2018.
Page 61
NOTES TO THE FINANCIAL STATEMENTS
• 6,250,000 at an exercise price of $0.15 each. The options are exercisable on or before 9 February
2019.
• 2,500,000 at an exercise price of $0.15 each. The options are exercisable on or before 9 June
2019.
• 8,750,000 at an exercise price of $0.15 each. The options are exercisable on or before 9 June
2020.
• 8,750,000 at an exercise price of $0.15 each. The options are exercisable on or before 9 June
2021.
$22,878 was the deemed cost of the options over ordinary shares for the financial year. The options
over ordinary shares hold no voting or dividend rights and are not transferable.
b. On 30 November 2017, shareholders approved the award of 35,000,000 performance shares to Mr
PD Reeve pursuant to an amendment to the Contract of Employment agreed between the Company
and Mr PD Reeve on 9 February 2015:
The following tranches set out the vesting periods for the award of performance shares to Executive
Chairman and Managing Director of the Company:
•
•
17,500,000 will vest on 30 November 2018.
17,500,000 will vest on 30 November 2019.
$362,832 (2018: $275,042) was the deemed cost of the performance shares for the financial year. The
performance shares hold no voting or dividend rights and are not transferable.
c. On 17 June 2018, the Company approved the award of 17,500,000 performance shares to Messrs
NJ Clifford and JM Madden and Dr WR Goodall with the board of directors ratifying the award on 4
September 2018. The performance shares were awarded under the Employee Share Plan.:
The following tranches set out the vesting periods for the award of performance shares to the above-
mentioned management of the Company:
•
•
•
5,000,000 will vest on 17 June 2019.
5,000,000 will vest on 17 June 2020.
5,000,000 will vest on 17 June 2021
$168,000 (2018: Nil) was the deemed cost of the performance shares for the financial year. The
performance shares hold no voting or dividend rights and are not transferable.
Page 62
NOTES TO THE FINANCIAL STATEMENTS
d. Summary of options over ordinary shares issued as share-based payments
2019
2018
Weighted
average
exercise
price
Number of
options
Number of
options
Weighted
average
exercise
price
Outstanding at start of the
financial year
Issued
Expired
Cancelled
Outstanding at the end of
the financial year
15,499,053
62,500,000
-
-
0.0275
0.0160
-
-
54,078,699
8,920,354
(12,500,000)
(35,000,000)
0.1018
0.0330
(0.0700)
(0.1286)
77,999,053
0.0183
15,499,053
0.0275
Exercisable at year end
77,999,053
0.0183
15,499,053
0.0275
The weighted average remaining contractual life of options outstanding at year end is 2.23 years
(2018: 1.23 years).
The weighted average exercise price of outstanding shares at the end of the reporting period is
$0.0183 (2018: $0.0275).
e. Summary of performance shares issued as share-based payments
2019
2018
Number of
performance
shares
Weighted
average
price
Number of
performance
shares
Weighted
average
price
Outstanding at start of the
financial year
Issued
Converted
-
Outstanding at the end of
the financial year
32,500,000
-
-
-
0.0217
-
-
-
35,000,000
15,000,000
(17,500,000)
-
0.0220
0.0210
(0.0220)
-
32,500,000
0.0217
32,500,000
0.0217
Convertible at year end
5,000,000
0.0210
-
-
f. Fair value of warrants granted
Aura Energy Limited granted WH Ireland on 12 September 2016 6,578,699 3-year warrants
at an exercise price of 2 cents per warrant over ordinary share. The share price on the date
of grant of the warrants was 2.5 cents per share with a volatility of 84% and a risk-free rate of
2%.
Note 29
Key management personnel
Details of key management personnel
Executive Chairman
PD Reeve
Non-executive directors
R Beeson
Page 63
NOTES TO THE FINANCIAL STATEMENTS
BF Fraser
JC Perkins
Company Secretary
JM Madden
Compensation of key management personnel
Compensation paid to key management personnel is as follows:
Short-term employee benefits
Post-employment benefits
Share-based payments in equity
Share-based payments in options
Share-based payments in performance shares
Payment to contractor for accounting and
secretarial services
30 June
2019
$
2018
$
696,300
36,400
-
-
418,832
-
1,151,532
523,800
32,600
25,000
22,874
275,042
99,936
979,252
Page 64
Note 30
Parent entity
a. Financial position of Aura Energy Limited
NOTES TO THE FINANCIAL STATEMENTS
Note
30 June
2019
$
2018
$
Assets
Current assets
Cash and cash equivalents
trade and other receivables
Financial assets
Total current assets
Non-current assets
Plant and equipment
Financial assets
Other assets
Total assets
Liabilities
Current liabilities
Trade and other payables
Provisions
Financial liabilities
Vendor consideration
Borrowings
Total current liabilities
Non-current liabilities
Borrowings
Provisions
Total liabilities
Net assets
Equity
Contributed equity
Reserves
Accumulated losses
Total equity
30b
812,296
37,294
57,710
907,300
2,662,849
6,378
60,926
2,730,153
4,064
7,927,227
13,113,116
21,044,407
8,124
6,146,034
11,740,657
17,894,815
21,951,707
20,624,968
497,009
63,499
266,667
71,295
694,215
1,592,685
694,216
15,341
709,557
303,133
28,405
-
-
331,538
-
-
-
2,302,242
331,538
19,649,465
20,293,430
46,315,150
1,378,701
(28,044,386)
19,649,465
44,698,295
353,929
(24,758,794)
20,293,430
Page 65
b. Financial assets
Loans to controlled entities
Shares in controlled entities at cost
c. Financial performance
Loss for year
Other comprehensive income
Total comprehensive income
NOTES TO THE FINANCIAL STATEMENTS
Note
30 June
2019
$
2018
$
30a
30a
30a
7,659,965
267,262
7,927,227
5,878,772
267,262
6,146,034
Note
30 June
2019
$
2018
$
(3,285,592)
-
(3,285,592)
(2,022,049)
-
(2,022,049)
d. Guarantees entered into by Aura Energy Limited for the debts of its controlled entities
There are no guarantees entered into by Aura Energy Limited for the debts of its controlled
entities as ay 30 June 2019 (2018: Nil).
e. Contingent liabilities of Aura Energy Limited
The are no other contingent liabilities as at 30 June 2019 other than the contingent liabilities set
out in Note 32 Contingent liabilities (2018: Nil).
f. Commitments by Aura Energy Limited
Note
30 June
2019
$
2018
$
a. Exploration expenditure commitments
Exploration tenement minimum expenditure
Payable
not later than 12 months
between 12 months and 5 years
greayter than 5 years
The group does not have any expenditure commitments
under the terms and conditions of the tenements it
holds. The exploration expenditure commitments relate
to annual renewal fees.
b. Operating lease commitments
Operating leases contracted for or committed to but not
capitalised in the financial statements
Payable
not later than 12 months
between 12 months and 5 years
greayter than 5 years
677,084
915,322
109,139
311,804
256,141
677,084
263,835
420,943
230,544
915,322
88,991
33,949
52,975
36,016
-
88,991
33,949
-
-
33,949
Page 66
NOTES TO THE FINANCIAL STATEMENTS
Note 31
Auditor’s remuneration
Amounts paid or due for payable to
Bentleys
Audit or review of the financial report
- amounts relating to previous year
Other services
Note 32
Contingent liabilities
30 June
2019
$
2018
$
46,053
-
3,200
49,253
44,605
-
894
45,499
Global Coal Management plc
On 15 October 2010, the Company and Global Coal Management plc entered into a Share Sale and
Purchase Agreement which resulted in the Company acquiring all the shares on issue in GCM Africa
Uranium, the entity which held the beneficial interest of GCM in the above- mentioned research permits
in Mauritania.
The Company paid GCM US$100,000 on execution of the Share Sale and Purchase Agreement;
US$472,183 in cash plus 2,000,000 fully paid ordinary shares in the Company on completion (due
diligence); and, US$500,000 on the first anniversary of completion.
The Company also agreed to pay a contingent consideration:
•
•
US$2,000,000 (in cash and shares as determine by the Company) on the delineation of 75
million pounds or more Initial Resource (not defined in the Letter Agreement) under the
Australasian Code for the Reporting of Exploration Results, Mineral Resources and Ore
Reserves; and
US$400,000 in cash and 400,000 fully paid ordinary shares in the Company for each
Subsequent Resource of 6,500,000 pounds up to a maximum of US$4,000,000 in cash and
4,000,000 in fully paid ordinary shares.
The obligations to make the contingent consideration payments are held by the Company and the
contingent consideration is only payable if the Initial Resource and Subsequent Resource are achieved
within 10 years of the date of the Share Sale and Purchase Agreement. Accordingly, the obligation to
pay the contingent consideration expires on 15 October 2020.
Servico sarl
The Group executed a Letter Option Agreement with Servico sarl on 29 May 2019 over a tenement
prospective for gold within the vicinity of tenements held by the Group through its controlled entity
Tiris International Mining Company Sarl. Under the terms and conditions of the Letter Option
Agreement, the Company agreed to pay service:
•
•
US$25,000 in cash; and
US$75,000 in fully paid ordinary shares;
on execution of the Letter Option Agreement.
On or prior to each anniversary of the commencement date and for a period of five years Aura must
inform Servico whether it wishes to continue to hold its Option or terminate the Option. If the Group
elects to continue to hold its Option by way of written notice to Servico on each anniversary date
after the commencement it will pay Servico US$25,000, at Aura’s election, in either cash or fully
paid ordinary shares. (If Aura holds the Option for the duration of the Option Period set out in this
Agreement it will make total payments to Servico of US$125,000.) If the Group elects to terminate
Page 67
NOTES TO THE FINANCIAL STATEMENTS
its Option it must inform Servico within seven days of its decision and arrange for its legal
representative in Mauritania to return to Servico the share transfer book and the Tenement title
documents.
On termination of the Option Servico is free to explore and exploit the tenement at its own cost and
the rights and obligations of the Group under this Agreement will cease
If the Group elects to exercise its Option and notifies Servico in writing of this decision to exercise
the Option:
•
•
Servico must transfer the tenement to a nominated Mauritanian-incorporated entity of the
Group within 30-days of the written notice; and
Aura must pay Servico US$500,000, at Group’s election, by way of cash or in fully paid
ordinary shares within 30-days of the notice and issue Servico with shares in the nominated
Mauritanian incorporated entity equal to 30 per cent of the paid-up capital of the Mauritanian
entity.
If mining and treatment are undertaken on the tenement by the joint venture and Aura is a 70%
party to the Joint Venture, Servico will be entitled to a royalty equal to US$1,000,000 for every
200,000 ounces of gold produced from mining and treatment of minerals extracted from the
tenement (or US$5 per ounce of gold produced from mining and treatment of minerals extracted
from the tenement). If mining and treatment are undertaken on the tenement by the joint venture
and the Group is a 70% party to the Joint Venture, Servico will be entitled to a one-off payment of
US$1,000,000 from the first US$1,000,000 of gold proceeds.
If a party to the joint venture is unable to fund its share of developing of mining and treatment, the
non-defaulting parties will have rights to dilute the defaulting venturer.
Geogruppen I Goteburg AB and Met Forages sarl
The Company executed a Drilling Services Agreement with Geogruppen on 14 February 2019 and
a Drilling Services Agreement with Met Forages on 8 August 2019. Geogruppen and Met Forages
agreed to have drilling invoices settled by way of the issue of fully paid ordinary shares in the
Company. The Company agreed to pay the face value of all Swedish Kroner and US dollar
invoices submitted by Geogruppen and Met Forages, respectively, and therefore, any difference
between the proceeds on sale of its shares and the face value of the invoices will be reimbursed by
the Company.
At the date of this annual report, both Geogruppen and Met Forages have not sold any shares
issued to each party under their respective Drilling Settlement Agreements.
Nomads Mining Company sarl
On 11 June 2018, the Group executed a Binding Term Sheet (see ASX Announcement, dated 11
June 2019) with the shareholders of Nomads Mining Company sarl, an entity incorporated in
Mauritania, to acquire a 70% equity interest in Nomads Mining Company sarl and on 26 June 2019
the Group and the shareholders of Nomads Mining Company sarl executed a Farm-in and Joint
Venture Agreement.
Under the terms and conditions of the above agreement, the Group agreed to pay the shareholders
of Nomads an entry fee of US$150,000. The first entry fee of US$25,000 in cash and the
Australian dollar equivalent of US$25,000 in fully paid ordinary shares was paid on execution of the
agreement. The second instalment of the entry fee (US$50,000) is payable, no later than six
months after the date of execution and third instalment of the entry fee (US$50,000) by way of
either cash or fully paid ordinary is payable no later than twelve months from the date of execution.
The second and third instalment fees are conditional on the Group continuing to exploration the
ground held by Nomads.
Page 68
NOTES TO THE FINANCIAL STATEMENTS
On completion of US$1,000,000 exploration programme (the Farm-in Commitment) on the
tenement held by Nomads, the shareholders of Nomads will assign 70% of their uncertificated
equity interest in Nomads to the Group. On the Group is assigned the uncertificated equity interest
is assigned the shareholders of Nomads, comprising the group and the existing shareholders of
Nomads, will form a joint venture with the Group to be appointed manager.
The Group will provide the shareholders of Nomads with a free-carry through to development and a
deferred carry following the decision to mine. The deferred carry is repayable with interest out of
dividends declared by nomads once in operations.
Tiris International Mining Company sarl
On 25 June 2016, the Group Tiris International Mining Company sari ("TIMCO") and Sid
Ahmed Mohamed Lemine Sidi Reyoug executed the Tasiast South sale and purchase agreement.
On 2 April 2019, TIMCO was granted tenements 2457 (Hadeibet Bellaa) and 2458 (Touerig Taet)
by the Ministry of Petroleum Energy and Mines.
Under the terms and conditions of the agreement if the Group proves up an 'Indicated Resource'
greater than one million ounces of gold it will be required to pay Sid Ahmed Mohamed US$250,000
and, on commencement of production, Aura is required to pay Sid Ahmed Mohamed US$5/ounce
of gold and a 0.4% net sales revenue royalty on other commodities with total royalty payments
capped to a maximum of US$5 million.
Note 33
Company details
The registered office and principal place of the Company is:
Level 1, 34-36 Punt Road, Windsor Victoria 3181
Telephone: +61 (0)3 9516 6500
Facsimile: +61 (0)3 9516 6565
Website: www.auraenergy.com.au
E-mail: info@auraenergy.com.au
Page 69
DIRECTORS’ DECLARATION
In accordance with a resolution of the board of directors of Aura Energy Limited, I state that:
In the opinion of the board of directors:
(a)
financial statements, the accompanying notes to the financial statements and the additional
disclosures set out in the Directors’ Report are in accordance with the Corporations Act 2001,
including:
(i)
(ii)
giving a true and fair view of the Company’s financial position as at 30 June 2019 and of
their performance for the period ended on that date; and
complying with Australian Accounting Standards (including Australian Accounting
Interpretations) and Corporations Regulations 2001;
(b)
(c)
the financial statements and notes also comply with International Financial Reporting Standards as
issued by the International Accounting Standard Board, as disclosed in Note 1a; and
there are reasonable grounds to believe that the Company will be able to pay its debts as and
when they become due and payable.
Signed on behalf of the Board of Directors
PD Reeve
Executive Chairman
30 September 2019
Page 70
Independent Auditor's Report
To the Members of Aura Energy Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Aura Energy Limited (“the Consolidated Entity”)
and its subsidiaries (“the Consolidated Entity”), which comprises the consolidated
statement of financial position as at 30 June 2019, the consolidated statement of profit or
loss and other comprehensive income, the consolidated statement of changes in equity
and the consolidated statement of cash flows for the year then ended, and notes to the
financial statements, including a summary of significant accounting policies, and the
directors’ declaration.
In our opinion:
a.
the accompanying financial report of the Consolidated Entity is in accordance with
the Corporations Act 2001, including:
(i)
giving a true and fair view of the Consolidated Entity’s financial position as
at 30 June 2019 and of its financial performance for the year then ended;
and
(ii)
complying with Australian Accounting Standards and the Corporations
Regulations 2001.
b.
the financial report also complies with International Financial Reporting Standards
as disclosed in Note 1(a)(i).
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Those
standards require that we comply with relevant ethical requirements relating to audit
engagements and plan and perform the audit to obtain reasonable assurance about
whether the financial report is free from material misstatement. 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 Consolidated Entity in
accordance with the auditor independence requirements of the Corporations Act 2001
and the ethical requirements of the Accounting Professional and Ethical Standards
Board’s APES 110 Code of Ethics for Professional Accountants (the Code) that are
relevant to our audit of the financial report in Australia. We have also fulfilled our other
ethical responsibilities in accordance with the Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our opinion.
Independent Auditor’s Report
To the Members of Aura Energy Limited (Continued)
Material Uncertainty Related to Going Concern
We draw attention to Note 1(a)(iii) in the financial report which indicates that the Consolidated Entity incurred a
net loss of $2,896,262 during the year ended 30 June 2019. As stated in Note1(a)(iii) , these events or
conditions, along with other matters as set forth in Note 1(a)(iii) , indicate that a material uncertainty exists that
may cast significant doubt on the Consolidated Entity’s ability to continue as a going concern. Our opinion is
not modified in this 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.
Key audit matter
How our audit addressed the key audit matter
Exploration and Evaluation Expenditure –
$21,008,293
Our procedures included, amongst others:
(Refer to Note 13)
Exploration and evaluation is a key audit matter due
to:
The significance of the balance to the
Consolidated Entity’s consolidated financial
position.
The level of judgement required in evaluating
management’s application of the requirements of
AASB 6 Exploration for and Evaluation of
Mineral Resources. AASB 6 is an industry
specific accounting standard requiring the
application of significant judgements, estimates
and industry knowledge. This includes specific
requirements for expenditure to be capitalised as
an asset and subsequent requirements which
must be complied with for capitalised
expenditure to continue to be carried as an
asset.
The assessment of impairment of exploration
and evaluation expenditure being inherently
difficult.
Assessing management’s determination of its
areas of interest for consistency with the
definition in AASB 6. This involved analysing the
tenements in which the consolidated entity holds
an interest and the exploration programmes
planned for those tenements.
For each area of interest, we assessed the
Consolidated Entity’s rights to tenure by
corroborating to government registries and
evaluating agreements in place with other parties
as applicable;
We tested the additions to capitalised
expenditure for the year by evaluating a sample
of recorded expenditure for consistency to
underlying records, the capitalisation
requirements of the Consolidated Entity’s
accounting policy and the requirements of AASB
6;
We considered the activities in each area of
interest to date and assessed the planned future
activities for each area of interest by evaluating
budgets for each area of interest.
We assessed each area of interest for one or
more of the following circumstances that may
indicate impairment of the capitalised
expenditure:
the licenses for the right to explore expiring in
Independent Auditor’s Report
To the Members of Aura Energy Limited (Continued)
the near future or are not expected to be
renewed;
substantive expenditure for further
exploration in the specific area is neither
budgeted or planned
decision or intent by the Consolidated Entity
to discontinue activities in the specific area of
interest due to lack of commercially viable
quantities of resources; and
data indicating that, although a development
in the specific area is likely to proceed, the
carrying amount of the exploration asset is
unlikely to be recovered in full from
successful development or sale.
We assessed the appropriateness of the related
disclosures in Note 13 to the financial statements.
Share based payments
Our procedures included, amongst others:
(Refer to Note 28)
As disclosed in note 28 in the financial statements,
during the year ended 30 June 2019, the
Consolidated Entity incurred share based payments
totalling $530,832.
Share based payments are considered to be a key
audit matter due to
the value of the transactions;
the complexities involved in recognition and
measurement of these instruments; and
Analysing contractual agreements to identify the
key terms and conditions of share based
payments issued and relevant vesting conditions
in accordance with AASB 2 Share Based
Payments;
Assessing the amount recognised during the
period against the vesting conditions of the
options;
Assessing the probabilities assigned to vesting
of the performance shares against available
information; and
Assessing the adequacy of the disclosures
the judgement involved in determining the inputs
included in the financial report.
used in the valuation.
Convertible Notes
As disclosed in Note 18 to the financial report, the
Consolidated Entity issued a convertible note during
the year with a face value of $2,400,000. As at 30
June 2019 the balance of the Convertible Notes
liability was $1,388,431 which reflects the tranches
received to date less relevant transaction costs
which are required to be amortised over the term of
the convertible notes.
Our procedures amongst others included:
analysing the agreement to identify the key
terms and conditions for each convertible
note;
verification of the funds received from the
issue of convertible notes during the year;
assessing the accounting treatment of the
financial instruments in accordance with the
Independent Auditor’s Report
To the Members of Aura Energy Limited (Continued)
recognition and measurement as well as the
Convertible Notes are considered to be a key audit
disclosure requirements of the relevant
matter due to:
Australian Accounting Standards;
the value of the balance; and
evaluating management’s option valuations
the complexities involved in the recognition
and assessing the assumptions and inputs
and measurement of convertible financial
used;
instruments and associated transaction
assessing the calculation including relevant
costs.
amortisation of finance costs for the year;
and
assessing the adequacy of the disclosures in
Note 18 to the financial report.
Other Information
The directors are responsible for the other information. The other information comprises the information
included in the Consolidated Entity’s annual report for the year ended 30 June 2019, but does not include the
financial report and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not express any
form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information and, in
doing so, consider whether the other information is materially inconsistent with the financial report or our
knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of the Directors for the Financial Report
The directors of the Consolidated Entity 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 Note
1(a)(i), the directors also state in accordance with Australian Accounting Standard AASB 101 Presentation of
Financial Statements, that the financial report complies with International Financial Reporting Standards.
In preparing the financial report, the directors are responsible for assessing the Consolidated Entity’s ability to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the going
concern basis of accounting unless the directors either intend to liquidate the Consolidated Entity or to cease
operations, or has no realistic alternative but to do so.
Auditor’s Responsibilities for the Audit of the Financial Report
Our responsibility is to express an opinion on the financial report based on our audit. Our objectives are to
obtain reasonable assurance about whether the financial report as a whole is free from material misstatement,
whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance
is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian
Independent Auditor’s Report
To the Members of Aura Energy Limited (Continued)
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 Consolidated Entity’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 Consolidated Entity’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 Consolidated Entity to cease to
continue as a going concern.
Evaluate the overall presentation, structure and content of the financial report, including the disclosures,
and whether the financial report represents the underlying transactions and events in a manner that
achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or
business activities within the Consolidated Entity to express an opinion on the financial report. We are
responsible for the direction, supervision and performance of the Consolidated Entity audit. We remain
solely responsible for our audit opinion.
We communicate with the directors regarding, among other matters, the planned scope and timing of the audit
and significant audit findings, including any significant deficiencies in internal control that we identify during our
audit.
We also provide the directors with a statement that we have complied with relevant ethical requirements
regarding independence, and to communicate with them all relationships and other matters that may
reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with the directors, we determine those matters that were of most significance
in the audit of the financial report of the current period and are therefore the key audit matters. We describe
these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or
when, in extremely rare circumstances, we determine that a matter should not be communicated in our report
Independent Auditor’s Report
To the Members of Aura Energy Limited (Continued)
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
We have audited the Remuneration Report included in the directors’ report for the year ended 30 June 2019.
The directors of the Consolidated Entity are responsible for the preparation and presentation of the
remuneration report in accordance with s 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.
Auditor’s Opinion
In our opinion, the Remuneration Report of the Consolidated Entity, for the year ended 30 June 2019, complies
with section 300A of the Corporations Act 2001.
BENTLEYS
Chartered Accountants
MARK DELAURENTIS CA
Partner
Dated at Perth this 30th day of September 2019
ADDITIONAL INFORMATION REQUIRED BY ASX LISTING RULES
Distribution of shareholders (as at 27 September 2019)
Range
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 Over
Rounding
Total
Unmarketable parcels
Units
% Units
5,490
84,725
225,771
41,938,784
1,258,660,071
0.00%
0.01%
0.02%
3.22%
96.75%
0.00%
1,300,914,841
100.00%
Minimum
Parcel
Holders
Units
Minimum $ 500.00 parcel at $ 0.0090 per unit
55,556
710
17,740,652
Voting rights
The voting rights attached to each class of equity security are as follows:
Ordinary shares Each ordinary share is entitled to one vote when a poll is called, otherwise each
member presentmeeting or by proxy has oone vote on a show of hands.
Company Secretary
The name of the company Secretary is John Madden
Principal registered office
As disclosed in Note 33 Company Details of the Annual Report
Registers of securities ate held at the following addresses
Computershare Investor Services Pty Ltd
Level 2, Reserve Bank Building
45 St Georges Terrace
Perth WA 6000
Telephone
Facsimile
1300 557 000
08 9323 2033
E-mail
web.queries@computershare.com.au
Securities Exchange Listing
Quotation has been granted for all the ordinary shares of Aura Energy Limited on all Member Exchanges of the
Australian Securities Exchange Limited.
Unquoted securities
Options and warrants over unissued ordinary shares are (2018; 127544,069 unlisted options and warrants are
on issue and 27,500,000 (2018:35,000,000) performance shares are on issue as at 27 September 2019.
Use of funds
The Group has used its funds in accordance with its initial business objectives.
Page 77
ADDITIONAL INFORMATION REQUIRED BY ASX LISTING RULES
Top twenty shareholders of ordinary shares (as at 27 September 2019)
Rank
Name
Shares
%
1.
2.
3.
4.
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
BNP PARIBAS NOMINEES PTY LTD
COMPUTERSHARE CLEARING PTY LTD
241,365,126
135,600,880
18.55%
10.42%
PRE-EMPTIVE TRADING PTY LTD
CITICORP NOMINEES PTY LIMITED
LIND GLOBAL MACRO FUND LP
MR LUKE PETER DALE + MRS MARIEANNE ERIKA DALE
MR PETER DESMOND REEVE
GEOGRUPPEN I GOTEBORG AB
MET FORAGES SARL
SAMBOLD PTY LTD
MR THOMAS IAN BARRETT
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
MR MALCOLM ALEXANDER BRIODY
MRS LISA GORDON
CS FOURTH NOMINEES PTY LIMITED
SERVICO SARL
YARANDI INVESTMENTS PTY LTD
MR STEVEN ALLAN WEBSTER
MR BASIL CATSIPORDAS
KAJUN DESIGNS PTY LTD
76,600,000
45,789,303
39,789,799
31,509,234
27,218,304
26,890,922
18,811,250
15,364,895
15,000,000
11,999,891
10,128,904
10,000,000
9,952,386
9,828,718
7,254,793
7,250,000
7,000,000
6,940,000
5.89%
3.52%
3.06%
2.42%
2.09%
2.07%
1.45%
1.18%
1.15%
0.92%
0.78%
0.77%
0.77%
0.76%
0.56%
0.56%
0.54%
0.53%
Total Top 20 shareholders
Total Remaining Holders
Total
754,444,405
546,460,436
1,300,904,841
57.99%
42.01%
100.00%
Page 78
ADDITIONAL INFORMATION REQUIRED BY ASX LISTING RULES
Top twenty option holders of ordinary shares (as at 27 September 2019)
Rank
Name
Units
% of units
PRE-EMPTIVE TRADING PTY LTD
15,119,934
14.30%
1
2
2
2
5
6
7
8
8
10
10
12
13
14
15
15
17
18
18
20
MR BRENDAN KERR
MR PERRY MORGAN
MR STEPHEN PYCROFT
MR BIN LIU
PEAK ASSET MANAGEMENT PTY LTD
PORTILLION CAPITAL LTD
9,684,211
9,684,211
9,684,211
7,894,737
5,000,000
2,747,788
HAMILTON HAWKES PTY LTD
2,631,579
THE AUSTRALIAN SPECIAL OPPORTUNITY FUND LP/C
KLIP PTY LTD
ROTHERWOOD ENTERPRISES PTY LTD
MR KAMRAN SATTAR
JOJO ENTERPRISES PTY LTD
MR GRAHAM JOHN WALKER
MR JACOB KLAAS GOEREE
VADLAMUDI (MEDICAL) PTY LTD
VECTOR NOMINEES PTY LTD
ALLEKIAN EXCHANGE PTY LTD
MR NOEL RUSSELL CAMERON
MR KEN MANJITHA
Top 20 holders of 3.3 cents options
Total Remaining Holders Balance
Total
2,631,579
2,500,000
2,500,000
2,421,053
2,342,106
1,973,684
1,500,000
1,500,000
1,426,316
1,315,790
1,315,790
1,210,526
85,083,515
20,652,648
9.15%
9.15%
9.15%
7.47%
4.73%
2.60%
2.48%
2.48%
2.36%
2.36%
2.29%
2.21%
1.87%
1.42%
1.42%
1.35%
1.24%
1.24%
1.14%
80.41%
19.59%
105,736,163
100.00%
Page 79
ADDITIONAL INFORMATION REQUIRED BY ASX LISTING RULES
Tenement report
Country
Mauritania
Sweden
Tenement
Number
Name
Grant/
Application
date
Expiry date
kms/sq
Holder
2491C4
2492C4
Ain Sder
Oued El Foule Est
8/02/2019
8/02/2019
Exploitation Licence
Exploitation Licence
561
1482
2002
2365
2366
2457
2458
Oum Ferkik
Oum Ferkik Sud
Aguelet
Oued el Foule Sud
Agouyame
Hadeibet Bellaa
Touerig Taet
2007-243
2017-04
2017-05
2018-9
2018-7
Haggan nr 1
Bolasen nr 1
Kinderassen nr 1
Mockelasen nr 1
Skallbole nr 1
16/04/2008
17/01/2017
17/01/2017
19/02/2018
19/02/2018
2/04/2019
2/04/2019
28/08/2007
2/02/2017
2/02/2017
21/01/2019
20/01/2019
Subject to exclusivity
negotiation
Exploration Licence
17/01/2020
19/02/2021
19/02/2021
2/04/2022
2/04/2022
28/08/2022
2/02/2020
2/02/2020
21/01/2022
20/01/2022
190
207
60
476
100
224
34
41
134
18.3
2,21
11.6
17.6
7.8
Tiris Ressources SA
Tiris Resources SA
Aura Energy Limited
Aura Energy Limited
Aura Energy Limited
Aura Energy Limited
Aura Energy Limited
Tiris International Mining
Tiris International Mining
Vanadis Battery Metals AB
Vanadis Battery Metals AB
Vanadis Battery Metals AB
Vanadis Battery Metals AB
Vanadis Battery Metals AB
Equity
85%
85%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
Page 80