Annual Report
Australian Pacific Coal Limited
Year Ending 30 June 2024
ABN 49 089 206 986
AUSTRALIAN PACIFIC COAL LIMITED
ABN 49 089 206 986
ANNUAL REPORT – 30 JUNE 2024
Annual Report
Australian Pacific Coal Limited
TOC
Year Ending 30 June 2024
ABN 49 089 206 986
TABLE OF CONTENTS
Chairman and CEO’s Report
i
Review of Operations
iv
Annual Financial Report
viii
- Directors’ Report
2
- Remuneration Report
5
- Auditor’s Independence Declaration
12
- Statement of Profit or Loss and Other Comprehensive Income
14
- Statement of Financial Position
15
- Statement of Changes in Equity
16
- Statement of Cash Flows
17
- Notes to the Financial Statements
18
- Consolidated entity disclosure statement
49
- Directors’ Declaration
50
- Independent Audit Report
51
Corporate Governance Statement
56
ASX Additional Information
68
Corporate Directory
70
CEO & CHAIRMAN’S REPORT
Page i
Australian Pacific Coal Limited
Annual Report
CEO & Chairman’s report
ABN 49 089 206 986
Year Ending 30 June 2024
Dear Shareholders,
The substantial achievements delivered in FY23 continued into FY24 as Australian Pacific Coal Limited (ASX:
AQC) surged towards restarting underground mining at the Dartbrook coal mine in NSW’s Hunter Valley.
The number of major milestones reached during FY24 reflects the high levels of operational, corporate and
financial activity across all aspects of our business.
The Board and Management had four key objectives for FY24:
Dewater, restore and refurbish the Hunter Tunnel
Secure sufficient restart capex funding and procure necessary equipment
Commence refurbishment of the train load out facility and Coal Handling and Preparation Plant
(CHPP)
Achieve first coal to surface
We have successfully achieved each of these goals, with a US$60 million (A$90 million) capex restart funding
debt package secured in January 2024, completion of the Hunter Tunnel restoration in August 2024, first coal to
surface in September 2024, and refurbishment of the train load out facility and CHPP underway.
With limited new coal mines being sanctioned in NSW, Dartbrook, via AQC, represents one of the few
opportunities where investors can access world-class resources and infrastructure with excellent proximity to
port and rail facilities on a pre-production basis.
Safety, Environment and People
Safety remains our highest priority and we are pleased to report that there were no recordable injuries or
reportable environmental incidents in the 12 months to 30 June 2024. As activity levels increase at Dartbrook,
we are committed to working with our Joint Venture partner to drive positive safety and environmental outcomes
for our people and the community.
In July 2024, following a period of negotiation, Dartbrook executed a four-year Greenfields Enterprise Agreement
with the Mining and Energy Union (MEU). The Agreement provides the necessary framework for the planned
employment for future mining and processing activities at Dartbrook. The Agreement, approved by the Fair Work
Commission (“FWC”) in September 2024, will facilitate the transition from restoration to production as the
workforce shifts from specialist contractors to operational personnel.
Restart Capex Funding Secured
Following the substantial de-risking of the mine and the streamlining of the operating joint venture in FY23, AQC
launched a comprehensive domestic and international program to source a debt funding package to provide
restart capex for the Dartbrook project.
In January 2024, AQC announced details of a US$60 million (A$92 million) debt facility provided by Vitol Asia
Pte Ltd, a leading global energy and commodities company. The facility covers forecast restart expenditure at
Dartbrook through to commercial production, including equipment acquisitions and completion of remediation
works, and the acquisition of additional mining systems during ramp-up to achieve full capacity.
The Dartbrook JV also entered into a Coal Sales and Marketing Agreement with Vitol for all Dartbrook coal
production, including assigning coal Marketing Rights to Vitol for the life of the mine (including any extensions).
CEO & CHAIRMAN’S REPORT
Page ii
Australian Pacific Coal Limited
Annual Report
CEO & Chairman’s report
ABN 49 089 206 986
Year Ending 30 June 2024
Dartbrook Restart Gains Momentum
The major focus of the Dartbrook restart project in FY24 was the Hunter Tunnel. This key piece of infrastructure,
which passes under the New England Highway, is critical to our ability to operate the mine as it connects the
proposed underground mining panels with the above ground CHPP and rail loadout.
As reported last year, the tunnel was successfully dewatered and more than 70 megalitres of water was removed
safely without incident. Thereafter, restoration and refurbishment work made rapid progress. Major workstreams
included roof and rib support, ventilation systems, roof and wall shotcreting, installation of services pipelines,
and tunnel fit-out. Work on the Hunter Tunnel was completed in August 2024.
Procurement made rapid progress once funding was secured. Orders for essential equipment for mining
operations were immediately confirmed.
The first phase of the restart plan requires two Continuous Mining Units (CMU) and both units have been
received. The first CMU is operating underground and the second CMU to follow once refurbishment, assembly
and testing are complete. A third CMU has now been secured.
The 4 km conveyor system, which transports Run of Mine (ROM) coal from the underground storage facility to
the surface via the Hunter Tunnel, was successfully commissioned with first coal to the surface achieved in
September 2024.
On the surface, installation of the new hydraulic system for the train load out facility is nearing completion. Prior
to commencing refurbishment works on the CHPP, a detailed study is being undertaken to assess all
requirements and establish a work program which is planned to commence in the first quarter of CY2025.
First Coal Produced to Surface
With the key elements of the mining and transportation chain in place and operational, Dartbrook achieved a
major milestone in early September 2024 when it successfully produced ROM coal to surface – the first time the
mine had produced coal since it was placed in care and maintenance in 2006.
This landmark event signalled the start of the ramp-up period to bring the mine into commercial production.
During this period, the focus will be on optimising systems, equipment, operations and maintenance procedures,
as well as the recruitment and training of permanent employees for the production phase.
The Dartbrook JV is targeting commercial production before the end of CY2024 with the intention of producing
unwashed (bypass) coal initially while refurbishment of the CHPP wet plant is completed.
Importantly, in September 2024 we received confirmation that coal from Dartbrook conforms to NEWC 6000
specifications which will ensure we can market Dartbrook thermal product to customers in key Asian export
markets once refurbishment of the CHPP is complete. Testing for metallurgical applications is ongoing and
results will be provided to the market in due course. The ability to produce metallurgical coal would provide
Dartbrook with product optionality and marketing flexibility.
Looking Ahead
While we have made great progress over the past 18 months, there is still much to do in FY25.
We are close to finalising a number of key operating agreements, chiefly Port and Rail access, and we are in
the process of finalising a US$30 million Working Capital facility to facilitate growth as we ramp up production.
We will continue to optimise the mine plan to maximise Dartbrook’s production potential, accelerating where
possible, while remaining focused on safety and reliability.
Completion of the CHPP refurbishment in the first half of CY2025 will be an important milestone, opening key
export markets for Dartbrook product.
Looking further ahead, we have commenced work on the MOD8 submission to extend mining operations at
Dartbrook by an additional six years to December 2033. Based on work done to date, we anticipate being in a
CEO & CHAIRMAN’S REPORT
Page iii
Australian Pacific Coal Limited
Annual Report
CEO & Chairman’s report
ABN 49 089 206 986
Year Ending 30 June 2024
position to make a formal submission to the NSW Department of Planning, Housing and Infrastructure (DPHI)
before the end of CY2024.
Finally, we would like to thank our employees, shareholders, partners and advisers for their hard work and
commitment towards restarting production at Dartbrook. We are excited about bringing this world class coal
mine back to life after lying dormant for 18 years and we are optimistic about the future potential of Australian
Pacific Coal.
Ayten Saridas
John Robinson
Managing Director & CEO
Chairman
REVIEW OF OPERATIONS
Page iv
Australian Pacific Coal Limited
Annual Report
Review of Operations
ABN 49 089 206 986
Year Ending 30 June 2024
DARTBROOK COAL MINE
Dartbrook Mine is located approximately 10 kilometres (km) north-west of Muswellbrook and 4.5 km south-west
of the village of Aberdeen in New South Wales (NSW) (see Figure 1). Dartbrook operated as an underground
longwall coal mine from 1993 until December 2006, when it was placed in care and maintenance by the previous
owner, Anglo Coal (Dartbrook Management) Pty Ltd (ACDM). The mine was acquired by Australian Pacific Coal
(AQC) (ASX-AQC) in 2016 and the mine has remained in care and maintenance.
Dartbrook Mine is an unincorporated Joint Venture (Dartbrook Joint Venture) between Australian Pacific Coal
Limited (via subsidiaries) and Tetra Resources Pty Ltd (Tetra, via subsidiaries). Dartbrook Operations Pty Ltd is
the appointed operating management company, and the Mine Operator under Section 5 of the Work Health and
Safety (Mines and Petroleum Sites) Regulation 2022 (NSW).
Dartbrook is managed in accordance with Development Consent DA 231-7-2000 (Development Consent) granted
on 28 August 2001 under the Environmental Planning and Assessment Act 1979 (EP&A Act). DA 231-7-2000
originally allowed for underground longwall mining and associated surface activities to be carried out until 5
December 2022.
In February 2018, AQC lodged an application to modify DA 231-07-2000 (MOD7) to provide further operational
options for Dartbrook (in addition to those already approved) including the recommencement of mining via bord
and pillar methodology within the Kayuga Seam and to extend the approval period under DA 231-07-2000 by 5
years (i.e. to 5 December 2027). DA 231-07-2000 (MOD7) was determined by the NSW Independent Planning
Commission (IPCN) on 9 August 2019.
The IPCN approved the proposed recommencement of mining activities but not the proposed five-year extension
to the consent approval period. Without the extension to operate under DA 231-07-2000 for a further five years
it was impractical to recommence mining at Dartbrook. In November 2019, an appeal was lodged against the
IPCN determination of MOD7 in the NSW Land and Environment Court.
The MOD7 application was the subject of a conciliation conference conducted pursuant to Section 34 of the Land
and Environment Court Act 1979 (LEC Act). AQC entered into a Section 34 agreement with the Minister for
Planning and Public Spaces on 21 December 2021 with the approval granted on 11 March 2022. This agreement
gave effect to MOD7 and extended the approved duration of mining operations until 5 December 2027.
Refurbishment and recommissioning works commenced at Dartbrook in 2022. Coal to surface was achieved on
4 September 2024 and a commissioning period is currently underway. Commercial production at Dartbrook is
anticipated before the end of the 4th quarter of calendar year 2024. Production will ramp up over the first two
years towards an initial target of approximately 2.4 million tonnes per annum (Mtpa) of Run of Mine (ROM) coal.
During this reporting period, key milestone achieved include:
•
Zero reportable environmental incidents and zero Lost Time and Disabling injuries.
•
AQC raised $12 million during September-October 2023 via a $4 million Institutional Placement and
a 1 for 4.75 Accelerated Non-Renounceable Entitlement Offer (ANREO) that raised $8 million.
•
In December 2023, AQC successfully completed a placement that raised $3.625 million in new funds
and converted $3.375 million of short-term shareholder loans and accrued lease payments to equity.
•
A US$60 million (A$92 million) senior debt facility for Dartbrook restart capex was executed in January
2024, covering forecast restart expenditure through to commercial production, including ramp-up.
•
A Coal Sales and Marketing Agreement was signed with Vitol Asia Pte Ltd for all Dartbrook coal
production, including coal Marketing Rights for the life of the mine (including any extensions).
REVIEW OF OPERATIONS
Page v
Australian Pacific Coal Limited
Annual Report
Review of Operations
ABN 49 089 206 986
Year Ending 30 June 2024
•
Following the successful dewatering of the Hunter Tunnel in FY23, works undertaken in FY24
included re-supporting of roof and ribs, bolting and mesh construction, shot-creting, and construction
of drainage, pumping, water management, electrical and ventilation restoration.
•
New 4 km conveyor system was delivered, assembly commenced.
•
Installation of the new hydraulic system for the train load-out facility is nearing completion.
•
A detailed study of the Coal Handling & Processing Plant (CHPP) was conducted in preparation for
the refurbishment program.
•
Continued to optimise the Mine Plan schedules and designs to improve yields, coal quality and
products.
•
Dartbrook Community Consultative Committee met quarterly and continued to provide active and
positive communications to neighbours and stakeholders.
Subsequent to the end of the reporting period, key milestones achieved include:
•
Dartbrook executed a four-year Greenfields Enterprise Agreement with the Mining and Energy Union
(MEU) in July 2024 which was subsequently approved by the Fair Work Commission in September
2024.
•
The first Continuous Miner Unit (CMU) was sent underground and a bulk sample was cut and sent
for lab analysis in July 2024.
•
Refurbishment and restoration of the Hunter Tunnel was completed in August 2024.
•
New 4 km conveyor system to convey ROM coal to the surface stockpile was commissioned
•
First coal was produced from in-seam to the surface stockpile in early September 2024.
•
Ramp up of manning and production continues during September and will continue through 2025
•
Confirmation in September 2024 that washed Dartbrook coal will conform to NEWC 6000
specifications.
REVIEW OF OPERATIONS
Page vi
Australian Pacific Coal Limited
Annual Report
Review of Operations
ABN 49 089 206 986
Year Ending 30 June 2024
On the 28 October 2022, (2022 No649), the NSW Government under the Environment Planning and Assessment
Act 1979, implemented a State Environmental Planning Policy (SEPP) Resources and Energy Amendment
(Dartbrook Mine) 2022 to prohibit open cut mining on the land, being defined as the Authority 256 boundary. Refer
to Figure 1 Highlighted Dartbrook area.
In addition, all the Dartbrook mining tenure was renewed from pending status to all current and approved with the
mining leases extended to 2043 (ML 1456 & 1497) and 2033 (ML 1381), refer to (Table 1 - Tenure Summary
Table). This is a considerable milestone as the project has now achieved tenure security and with this success
will be highly valued and considered when the application for a further extension of the current Development
Consent conditions (MOD 8) for an additional 6 years is prepared and processed. This will be a priority once
production is underway and the approval will be assessed by the Department of Planning & Environment.
The Dartbrook mine is in a safe and operational readiness state with a professional workforce ready to transit into
production.
Figure 1 Regional Locality
REVIEW OF OPERATIONS
Page vii
Australian Pacific Coal Limited
Annual Report
Review of Operations
ABN 49 089 206 986
Year Ending 30 June 2024
OTHER PROJECTS
In Queensland, the Company holds interests in the Matuan Downs Bentonite Project and a Joint Venture interest
on tenements with Blackwood Resources. The Company will continue to assess potential development or
divestment opportunities in relation to these assets.
MINING TENEMENT SUMMARY
Name
Number
Status
Expiry Date
Interest Held
Dartbrook Project, Hunter Valley NSW
AUTH 256
AUTH 256
Granted
16/12/2025
100%
EL 4574
EL 4574
Granted
13/08/2024
100%
EL 4575
EL 4575
Granted
13/08/2027
100%
EL 5525
EL 5525
Granted
22/09/2027
100%
CL 386
CL 386
Granted
19/12/2033
100%
ML 1381
ML 1381
Granted
19/12/2033
100%
ML 1456
ML 1456
Granted
27/09/2043
100%
ML 1497
ML 1497
Granted
5/12/2043
100%
Matuan Downs Bentonite Project, Alpha
Mantuan
ML 70360
Granted
31 /03/2033
100%
Table 1 Tenure Summary Table
Name
Number
Status
Interest Held
Blackwood Joint Venture, Miles QLD
Bungaban Creek
EPC 1955
Granted
10% #
Quondong
EPC 1987
Granted
10% #
# The Company’s 100% owned subsidiary Mining Investments One Pty Ltd holds a 10% interest
in each of the following Blackwood Resources Pty Ltd JV tenements.
Page viii
Australian Pacific Coal Limited
ABN 49 089 206 986
Annual Financial Report - 30 June 2024
Australian Pacific Coal Limited
Directors' report
30 June 2024
2
The Directors present their report, together with the financial statements, on the Group (referred to hereafter as the 'Group)
consisting of Australian Pacific Coal Limited (referred to hereafter as the 'Company' or 'parent entity') and the entities it
controlled at the end of, or during, the year ended 30 June 2024.
Directors
The following persons were the Directors of Australian Pacific Coal Limited during the whole of the financial year and up to
the date of this report, unless otherwise stated:
Current Directors
John Robinson (Appointed 5 June 2024)
Ayten Saridas
Nicholas Johansen
Jeff Gerard (Appointed 5 June 2024)
Former Directors
Jeff Beatty (Resigned 23 April 2024)
Mike Ryan (Resigned 17 June 2024)
Principal activities
During the financial year the principal continuing activities of the Group consisted of exploration and development activities
at the Group’s mining tenements situated in New South Wales, Australia.
Dividends
No dividends were declared or paid for the financial year ended 30 June 2024.
Review of operations
The review of operations of the Group during the year is detailed in the review of operations commencing in the Chairman’s
report and forms part of the Directors’ report.
The Group holds an 80% working interest in the Dartbrook Joint Arrangement (70% economic interest), an arrangement
structured as a strategic partnership with the Group and other parties. The primary purpose of the joint arrangement is to
facilitate exploration, mining and sale of coal from the Dartbrook project. Under the joint arrangement agreement, all of the
assets, rights, duties, obligations and liabilities incurred by the arrangement are shared by the partners in proportion to their
share. As such the arrangement is classed as a joint operation, and accordingly, the Group’s interests in the assets, liabilities,
revenues and expenses attributable to the joint arrangement have been included in the appropriate line items in the
consolidated financial statements. Comparative information for the financial year ended 30 June 2023 has therefore been
reclassified into new categories as appropriate for comparison, with no changes to the underlying accounting.
The loss for the Group after providing for income tax amounted to $12,630,899 (30 June 2023: loss of $12,517,633).
Significant changes in the state of affairs
There were no significant changes in the state of affairs of the Group during the financial year.
Likely developments and expected results of operations
The Group intends to continue its development activities on its existing projects and to explore other suitable opportunities
as they arise.
Environmental regulation
The Group is subject to, and is compliant with, all aspects of environmental regulation in its exploration and mining activities.
The Directors believe that the Company is in compliance with all environmental laws.
The Group is subject to the reporting requirements of both the Energy Efficiency Opportunities Act 2006 and the National
Greenhouse and Energy Reporting Act 2007.
The Energy Efficiency Opportunities Act 2006 requires the Group to assess its energy usages, including the identification,
investigation and evaluation of energy saving opportunities, and to report publicly on the assessments undertaken,
including what action the Group intends to take as a result of these assessments. Due to this Act, the Group has registered
with the Department of Resources, Energy and Tourism as a participant entity and reports the results from its
assessments.
Australian Pacific Coal Limited
Directors' report
30 June 2024
3
The National Greenhouse and Energy Reporting Act 2007 require the Group to report its annual greenhouse gas emissions
and energy use. The Group has previously implemented systems and processes for the collection and calculation of data.
Further information on the reporting and results of the application of the above Acts to the Group’s activities can be found on
the Group's website.
Matters subsequent to the end of the financial year
No matter or circumstance has arisen since 30 June 2024 that has significantly affected, or may significantly affect the
Group’s operations, the results of those operations, or the Group’s state of affairs in future financial years.
Information on Directors
Name:
John Robinson
Title:
Non-Executive Director and Chairman from 18 June 2024
Qualifications:
Bachelor of Accounting
Experience and expertise:
Mr Robinson is an accomplished executive and director with background in the
property, mining and retail sectors. John is also the former Managing Director of
Australian Pacific Coal Limited from 30 October 2018 to 18 November 2019.
Director of Australian Pacific Coal Limited since 5 June 2024.
Other current directorships:
None
Former directorships (last 3 years):
None
Interests in shares:
None
Interests in options:
None
Interests in performance rights:
None
Name:
Ayten Saridas
Title:
Manager Director and Chief Executive Officer from 18 June 2024 (Executive Director
and Acting Chief Executive Officer from 16 January 2023 to 17 June 2024)
Qualifications:
Masters of Applied Finance, Bachelor of Commerce, Fellow CPA
Experience and expertise:
Ms Saridas is a finance executive with over 30 years of international experience
across a broad range of industries including oil and gas, mining, retail, infrastructure,
property, and financial services. Ms Saridas has an established reputation in the
financial markets and has held CFO and executive roles with Coronado Global
Resources, Santos Limited, AWE Limited and Woolworths amongst other ASX listed
companies.
Director of Australian Pacific Coal Limited since 25 November 2022.
Other current directorships:
Parkway Corporation Limited
Former directorships (last 3 years):
None
Interests in shares:
None
Interests in options:
None
Interests in performance rights:
None
Australian Pacific Coal Limited
Directors' report
30 June 2024
4
Name:
Nick Johansen
Title:
Non-Executive Director
Qualifications:
Bachelor of Economics; Bachelor of Law
Experience and expertise:
Mr Johansen is a solicitor with extensive mining experience, ranging from junior
exploration to production, across a range of commodities. Nick has expertise in
transactions, resources regulation, native title and environmental law. Nick
completed his Graduate Diploma of Legal Practice at Australian National University.
In addition, he holds a BA in economics from the University of Adelaide.
Director of Australian Pacific Coal Limited since 9 January 2023.
Other current directorships:
Orcoda Limited (non-executive)
Former directorships (last 3 years):
Paterson Resources Limited (non-executive)
Interests in shares:
None
Interests in options:
None
Interests in performance rights:
None
Name:
Jeff Gerard
Title:
Non-Executive Director from 5 June 2024
Qualifications
Associate Diploma in Applied Chemistry
Experience and expertise:
Mr Gerard is a seasoned Company Director of exploration, development and
operating companies globally. He has over 40 years’ management experience in
the resource industry gained through various technical, operational, commercial
and executive management roles with global mining companies in Australia and
internationally.
Other current directorships
KGL Resources Limited
Former directorships (last 3 years):
None
Interests in shares:
None
Interests in options:
None
Interests in performance rights:
None
Name:
Jeff Beatty
Mr Beatty was appointed as a Director of Australian Pacific Coal Limited on 9
January 2023. Mr Beatty resigned from the Company effective 23 April 2024.
Name:
Mike Ryan
Mr Ryan was appointed as a Director of Australian Pacific Coal Limited on 25
November 2022 and Acting Chairman from 16 January 2023. Mr Ryan resigned
from the Company effective 17 June 2024.
'Other current directorships' quoted above are current directorships for listed entities only and excludes directorships of all
other types of entities, unless otherwise stated.
'Former directorships (last 3 years)' quoted above are directorships held in the last 3 years for listed entities only and excludes
directorships of all other types of entities, unless otherwise stated.
Chief Financial Officer
Theo Renard was appointed as the Chief Financial Officer on 29 April 2024.
Mr Renard is a Chartered Accountant and has over 21 years’ experience in credit and relationship banking in commercial
and investment banking across South Africa, Asia, and Australia. He is an experienced Chief Financial Officer and Company
Secretary within retail group environments and manufacturing operations in Asia and the Subcontinent, as well as within
resources in Australia and overseas. He is an experienced director, having served on the boards of both overseas listed
companies and ASX listed companies.
Australian Pacific Coal Limited
Directors' report
30 June 2024
5
Company secretary
Craig McPherson was appointed as the Company Secretary on 23 August 2019.
Mr McPherson graduated with a Bachelor of Commerce degree from the University of Queensland and is a member of
Chartered Accountants Australia and New Zealand. He has in excess of twenty-five years of commercial and financial
management experience and has held various executive roles with ASX, TSX and NZX listed companies over the past
seventeen years in Australia and overseas.
Meetings of Directors
The number of meetings of the Company's Board of Directors ('the Board') and of each Board committee held during the
year ended 30 June 2024, and the number of meetings attended by each Director were:
Full board
Attended
Held
John Robinson
1
1
Ayten Saridas
20
20
Nick Johansen
20
20
Jeff Gerard
1
1
Jeff Beatty
18
18
Mike Ryan
20
20
Held: represents the number of meetings held during the time the Director held office or was a member of the relevant
committee.
Remuneration report (audited)
The remuneration report details the key management personnel remuneration arrangements for the Group in accordance
with the requirements of the Corporations Act 2001 and its Regulations.
Key management personnel are those persons having authority and responsibility for planning, directing and controlling the
activities of the entity, directly or indirectly, including all Directors.
The remuneration report is set out under the following main headings:
● Principles used to determine the nature and amount of remuneration
● Details of remuneration
● Service agreements
● Share-based compensation
● Additional information
● Additional disclosures relating to key management personnel
Principles used to determine the nature and amount of remuneration
The objective of the Group's executive reward framework is to ensure reward for performance is competitive and appropriate
for the results delivered. The framework aligns executive reward with the achievement of strategic objectives and the creation
of value for shareholders, and it is considered to conform to the market best practice for the delivery of reward. The Board
of Directors ('the Board') ensures that executive reward satisfies the following key criteria for good reward governance
practices:
● competitiveness and reasonableness
● acceptability to shareholders
● performance linkage / alignment of executive compensation
● Transparency
The Board is responsible for determining and reviewing remuneration arrangements for its Directors and Executives. The
performance of the Group depends on the quality of its Directors and Executives. The remuneration philosophy is to attract,
motivate and retain high performance and high-quality personnel.
The Board has structured an executive remuneration framework that is market competitive and complementary to the reward
strategy of the Group.
Australian Pacific Coal Limited
Directors' report
30 June 2024
6
The reward framework is designed to align executive reward to shareholders' interests. The Board has considered that it
should seek to enhance shareholders' interests by:
● having economic profit as a core component of plan design
● focusing on sustained growth in shareholder wealth, consisting of dividends and growth in share price, and delivering
constant or increasing return on assets as well as focusing the executive on key financial and non-financial drivers of
value
● attracting and retaining high calibre executives
Additionally, the reward framework seeks to enhance executives' interests by:
● rewarding capability and experience
● reflecting competitive reward for contribution to growth in shareholder wealth
● providing a clear structure for earning rewards
In accordance with best practice corporate governance, the structure of Non-Executive Director and Executive Director
remuneration is separate.
Non-executive director’s remuneration
Fees and payments to Non-Executive Directors reflect the demands and responsibilities of their role. Board may, from time
to time, receive advice from independent remuneration consultants to ensure non-executive directors' fees and payments
are appropriate and in line with the market.
ASX listing rules require the aggregate Non-Executive Directors' remuneration be determined periodically by a general
meeting. The most recent determination was at the General Meeting held on 30 October 2015 where the shareholders
approved a maximum annual aggregate remuneration of $500,000.
Non-Executive Directors are also entitled to consulting fees to the extent that they provide services in excess of those typically
provided as a Non-Executive Director of the Company.
Executive remuneration
The Group aims to reward executives based on their position and responsibility, with a level and mix of remuneration which
has both fixed and variable components.
The executive remuneration and reward framework has four components:
● base pay and non-monetary benefits
● short-term performance incentives
● share-based payments
● other remuneration such as superannuation and long service leave
The combination of these components comprises the executive's total remuneration.
Fixed remuneration, consisting of base salary, superannuation and non-monetary benefits, is reviewed regularly by the Board
and subject to individual contracts is based on individual and business unit performance, the overall performance of the
Group and comparable market remunerations.
Executives may receive their fixed remuneration in the form of cash or other fringe benefits (for example motor vehicle
benefits) where it does not create any additional costs to the Group and provides additional value to the executive.
The Board periodically reviews the Company’s short-term and long-term incentive arrangements for Executive Directors,
Non-Executive Directors and employees and consultants to ensure the appropriate alignment of interests of all stakeholders
and to reward the achievement of pre-specified Key Performance Indicators.
Group performance and link to remuneration
Remuneration for certain individuals may be directly linked to the performance of, and outcomes achieved for, the Group
together with bonus and incentive payments at the discretion of the Board.
Voting and comments made at the company's 2023 Annual General Meeting ('AGM')
At the 2023 AGM, shareholders voted to support the adoption of the remuneration report for the year ended 30 June 2023.
The Company did not receive any specific feedback at the AGM regarding its remuneration practices.
Australian Pacific Coal Limited
Directors' report
30 June 2024
7
Details of remuneration
Amounts of remuneration
Details of the remuneration of Key Management Personnel of the Group are set out in the following tables.
The Key Management Personnel of the Group consisted of the following Directors of Australian Pacific Coal Limited during
the year:
●
John Robinson - Non-Executive Director (appointed on 5 June 2024) and Acting Chairman from 18 June 2024
●
Ayten Saridas – Managing Director and Chief Executive Officer from 18 June 2024
●
Nicholas Johansen – Non-executive Director
●
Jeff Gerard – Non-executive Director (appointed on 5 June 2024)
●
Theo Renard – Chief Financial Officer (appointed on 29 April 2024)
●
Jeff Beatty – Non-executive Director (resigned on 23 April 2024)
●
Mike Ryan – Non-executive Director and Acting Chairman (resigned on 17 June 2024)
Short-term benefits
Post-
employment
benefits
Long-term
benefits
Share-based payments
Cash salary
Cash
Termination
Super-
Long service Equity-settled Equity-settled
and fees
bonus
annuation
leave
shares
options
Total
2024
$
$
$
$
$
$
$
$
Non-Executive
Directors:
John Robinson
6,506
-
-
716
-
-
-
7,222
Nicholas Johansen
52,000
-
-
-
-
-
-
52,000
Jeff Gerard
6,250
-
-
-
-
-
-
6,250
Jeff Beatty
42,996
-
-
4,730
-
-
-
47,726
Mike Ryan
46,900
100,000
-
5,159
-
-
-
152,059
Executive Director:
Ayten Saridas
452,000
-
-
-
-
-
-
452,000
Theo Renard
57,375
-
-
-
-
-
-
57,375
664,027
100,000
-
10,605
-
-
-
774,632
Australian Pacific Coal Limited
Directors' report
30 June 2024
8
Short-term benefits
Post-
employment
benefits
Long-term
benefits
Share-based payments
Cash salary
Cash
Termination
Super-
Long service Equity-settled Equity-settled
and fees
bonus
annuation
leave
shares
options
Total
2023
$
$
$
$
$
$
$
$
Non-Executive
Directors:
Mike Ryan
28,235
-
-
2,965
-
-
-
31,200
Nicholas Johansen
24,043
-
-
-
-
-
24,043
Jeff Beatty
21,758
-
-
2,285
-
-
-
24,043
Tony Lalor
35,083 150,000
-
-
-
-
-
185,083
Craig McPherson
21,667
-
-
-
-
-
-
21,667
Executive Directors:
Ayten Saridas
212,056
-
-
-
-
-
-
212,056
David Conry
300,639
150,000
-
-
-
-
-
450,639
643,481
300,000
-
5,250
-
-
-
948,731
1.
Craig McPherson resigned 25 November 2022
2.
Mike Ryan appointed 25 November 2022
3.
Ayten Saridas appointed 25 November 2022
4.
Nicholas Johansen appointed 9 January 2023
5.
Jeff Beatty appointed 9 January 2023
6.
David Conry AM resigned 16 January 2023
7.
Tony Lalor resigned 3 March 2023
The proportion of remuneration linked to performance and the fixed proportion are as follows:
Fixed remuneration
At risk - STI
At risk - LTI
Name
2024
2023
2024
2023
2024
2023
Non-Executive Directors:
John Robinson
100%
100%
-
-
-
-
Nicholas Johansen
100%
100%
-
-
-
-
Jeff Gerard
100%
100%
-
-
-
-
Jeff Beatty
100%
100%
-
-
-
-
Mike Ryan
100%
100%
-
-
-
-
Executive Director:
Ayten Saridas
100%
100%
-
-
-
-
Service agreements
Remuneration and other terms of employment for Key Management Personnel are formalised in service agreements. Details
of these agreements are as follows:
Current agreements:
Name
Ayten Saridas
Title
Managing Director and Chief Executive Officer
Term of agreement
Ongoing appointment, subject to termination rights noted below.
Details
Base salary of $400,000 per annum plus director fee of $75,000 per year. Ms Saridas
or her nominee is eligible to receive any forms of equity type compensation as
reasonably determined by the Board from time to time. 1 months’ notice of intention to
resign and the Company may terminate the agreement by giving 1 months’ notice.
Australian Pacific Coal Limited
Directors' report
30 June 2024
9
Name
Theo Renard
Title
Chief Financial Officer
Term of agreement
2-year appointment, subject to extension or termination rights noted below.
Details
Base fee of $388,500 per annum. Mr Renard or his nominee is eligible to receive any
forms of equity type compensation as reasonably determined by the Board from time to
time. Upon completion of the term, appointment to be extended for rolling two-year
periods thereafter upon mutual agreement. 3 months’ notice of intention to resign and
the Company may terminate the agreement by giving 6 months’ notice.
Key Management Personnel have no entitlement to termination payments in the event of removal for misconduct.
Options
There were no options over ordinary shared issued as remuneration to Directors or other Key Management Personnel in the
year ended 30 June 2024.
Performance Rights
There are no performance rights over ordinary shares granted, exercised and lapsed for Directors and other key management
personnel as part of compensation during the year ended 30 June 2024 and 2023.
No performance rights have been granted to Key Management Personnel since the end of the financial year.
Additional disclosures relating to Key Management Personnel
Shareholding
The number of shares in the Company held during the financial year by each Director and other members of Key
Management Personnel of the Group, including their personally related parties, is set out below:
Balance at
Received
Balance at
the start of
as part of
Disposals/
the end of
the year
remuneration
Additions
Other
the year
Ordinary shares
John Robinson
-
-
-
-
-
Ayten Saridas
-
-
-
-
-
Nicholas Johansen
-
-
-
-
-
Jeff Gerard
-
-
-
-
-
Theo Renard
-
-
-
-
-
Jeff Beatty 1
-
-
-
-
-
Mike Ryan 1
-
-
-
-
-
1.
Represents shareholding at date of resignation as Director
Option holding
There were no options over ordinary shares in the Company held during the financial year by any Director and other members
of Key Management Personnel of the Group, including their personally related parties.
Performance Rights Held by Key Management Personnel
There were no performance rights held directly, indirectly or beneficially by Key Management Personnel during the financial
year.
Other transactions with key management personnel and their related parties
From 1 July 2023 until resignation as a Director, the Group paid Whiterock Resources Pty Ltd, an entity associated with Mr
Beatty, $317,375 for services connected with the Dartbrook Joint Venture, which was paid in full at reporting date.
There were no other transactions with key management personnel and their related parties during the financial year other
than those transactions disclosed within this annual financial report.
This concludes the remuneration report, which has been audited.
Australian Pacific Coal Limited
Directors' report
30 June 2024
10
Shares under option, performance rights or convertible note
On 5 April and 27 May 2024, 12,085,526 and 1,700,835 options were issued to Evolution Capital Pty Ltd respectively as a
settlement of a dispute in connection with an underwriting agreement. These options were issued with a $0.34 exercise price
and a 3-year exercise period expiring on 5 April 2027.
There are no other unissued ordinary shares of Australian Pacific Coal Limited under option or convertible note at the date
of this report.
Proceedings on behalf of the Company
No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings on behalf
of the Company, or to intervene in any proceedings to which the Company is a party for the purpose of taking responsibility
on behalf of the Company for all or part of those proceedings.
Non-audit services
Details of the amounts paid or payable to the auditor for non-audit services provided during the financial year by the auditor
are outlined in Note 23 to the financial statements.
The Directors are satisfied that the provision of non-audit services during the financial year by the auditor (or by another
person or firm on the auditor's behalf) is compatible with the general standard of independence for auditors imposed by the
Corporations Act 2001.
The Directors are of the opinion that the services as disclosed in note 23 to the financial statements do not compromise the
external auditor's independence requirements of the Corporations Act 2001 for the following reasons:
●
all non-audit services have been reviewed and approved to ensure that they do not impact the integrity and objectivity
of the auditor; and
●
none of the services undermine the general principles relating to auditor independence as set out in APES 110 Code
of Ethics for Professional Accountants issued by the Accounting Professional and Ethical Standards Board, including
reviewing or auditing the auditor's own work, acting in a management or decision-making capacity for the company,
acting as advocate for the company or jointly sharing economic risks and rewards.
The following fees were paid or payable to Hall Chadwick for non-audit services provided during the year ended 30 June
2024:
$
Taxation services
11,500
11,500
Officers of the Company who are former partners of Hall Chadwick Chartered Accountants
There are no officers of the Company who are former partners of Hall Chadwick Chartered Accountants.
Rounding of amounts
The Company is of a kind referred to in Corporations Instrument 2016/191, issued by the Australian Securities and
Investments Commission, relating to 'rounding-off'. Amounts in this report have been rounded off in accordance with that
Corporations Instrument to the nearest dollar.
Auditor's independence declaration
A copy of the auditor's independence declaration as required under section 307C of the Corporations Act 2001 is set out
immediately after this Directors' report.
Auditor
Hall Chadwick Chartered Accountants continues in office in accordance with section 327 of the Corporations Act 2001.
Indemnity and insurance of officers
The Company has indemnified the Directors and Executives of the Company for costs incurred, in their capacity as a director
or executive, for which they may be held personally liable, except where there is a lack of good faith.
During the financial year, the Company paid a premium in respect of a contract to insure the Directors and Executives of the
company against a liability to the extent permitted by the Corporations Act 2001. Details of the premium are subject to a
confidentiality clause under the contract of insurance.
Australian Pacific Coal Limited
Directors' report
30 June 2024
11
This report is made in accordance with a resolution of Directors, pursuant to section 298(2)(a) of the Corporations Act 2001.
On behalf of the Directors
___________________________
John Robinson
Chairman
30 September 2024
Brisbane
Australian Pacific Coal Limited
Directors' report
30 June 2024
13
Consolidated Statement of Profit or Loss and Other Comprehensive Income
14
Consolidated Statement of Financial Position
15
Consolidated Statement of Changes in Equity
16
Consolidated Statement of Cash Flows
17
Notes to the Consolidated Financial Statements
18
Consolidated entity disclosure statement
49
Directors' declaration
50
Independent auditor's report to the members of Australian Pacific Coal Limited
51
General information
The consolidated financial statements cover Australian Pacific Coal Limited as a Group consisting of Australian Pacific Coal
Limited and the entities it controlled at the end of, or during, the year. The consolidated financial statements are presented
in Australian dollars, which is Australian Pacific Coal Limited’s functional and presentation currency.
Australian Pacific Coal Limited is a listed public company limited by shares, incorporated and domiciled in Australia. Its
registered office and principal place of business are:
Registered office
Principal place of business
Level 1, 371 Queen Street
Stair Street
Brisbane QLD 4000
Kayuga NSW 2333
A description of the nature of the Group's operations and its principal activities are included in the Directors' report, which is
not part of the financial statements.
The financial statements were authorised for issue, in accordance with a resolution of Directors, on 30 September 2024. The
Directors have the power to amend and reissue the financial statements.
Australian Pacific Coal Limited
Statement of Profit or Loss and Other Comprehensive Income
As at 30 June 2024
Consolidated
Note
2024
2023*
$
$
The above statement of financial position should be read in conjunction with the accompanying notes
14
Revenue – other income
4
2,536,951
319,715
Expenses
Site and corporate overheads
5
(10,026,294)
(6,265,006)
Depreciation and amortisation expense
5
(1,186,086)
(1,029,053)
Finance costs
5
(3,955,470)
(5,543,289)
Loss before income tax expense from continuing
operations
(12,630,899)
(12,517,633)
Income tax expense
6
-
-
Other comprehensive income
Other comprehensive income for the year, net of tax
-
-
Total comprehensive income for the year
(12,630,899)
(12,517,633)
Earnings per share for profit attributable to the
owners of Australian Pacific Coal Limited
Cents
Cents
Basic earnings per share
32
(2.74)
(5.23)
Diluted earnings per share
32
(2.72)
(5.23)
*The comparative information for 2023 is reclassified into new categories where appropriate to align with 2024 disclosures to
reflect the Group’s nature of business under joint operation.
Australian Pacific Coal Limited
Statement of financial position
As at 30 June 2024
Consolidated
Note
2024
2023
$
$
The above statement of financial position should be read in conjunction with the accompanying notes
15
Assets
Current assets
Cash and cash equivalents
7
17,784,637
3,681,525
Trade and other receivables
8
1,612,126
340,301
Loans receivable
9
1,200,000
16,022,782
Other
10
2,198,507
397,333
Total current assets
22,795,270
20,441,941
Non-current assets
Property, plant and equipment
11
5,034,022
2,751,401
Exploration and evaluation
12
-
5,894,592
Mining properties
13
55,570,567
-
Right-of-use assets
14
2,880,682
-
Loan receivable
9
8,185,150
-
Other
16
7,996,993
8,998,233
Total non-current assets
79,667,414
17,644,226
Total assets
102,462,684
38,086,167
Liabilities
Current liabilities
Trade and other payables
17
13,792,181
4,497,454
Lease liabilities
24
514,231
-
Total current liabilities
14,306,412
4,497,454
Non-current liabilities
Provisions
18
16,922,800
20,041,000
Lease liabilities
24
2,395,278
-
Borrowings
20
50,020,181
-
Total non-current liabilities
69,338,259
20,041,000
Total liabilities
83,644,671
24,538,454
Net assets
18,818,013
13,547,713
Equity
Issued capital
19
172,655,173
154,753,974
Accumulated deficits
(153,837,160)
(141,206,261)
Total equity
18,818,013
13,547,713
Australian Pacific Coal Limited
Statement of changes in equity
For the year ended 30 June 2024
The above statement of changes in equity should be read in conjunction with the accompanying notes
16
Issued
capital
Reserves
Retained
profits
Total equity
Consolidated
$
$
$
Balance at 1 July 2022
60,487,791
413,750
(128,688,628)
(67,787,087)
Loss after income tax expense for the half-year
-
-
(12,517,633)
(12,517,633)
Other comprehensive income for the half-year, net of
tax
-
-
-
-
Total comprehensive income for the half-year
-
-
(12,517,633)
(12,517,633)
Transactions with owners in their capacity as owners:
Share based payments
-
-
-
-
Contributions of equity, net of transaction costs
93,852,433
-
-
93,852,433
Contributions of equity, transfers from reserves
413,750
(413,750)
-
-
Balance at 30 June 2023
154,753,974
-
(141,206,261)
13,547,713
Issued
capital
Reserves
Retained
profits
Total equity
Consolidated
$
$
$
$
Balance at 1 July 2023
154,753,974
-
(141,206,261)
13,547,713
Loss after income tax expense for the year
-
-
(12,630,899)
(12,630,899)
Other comprehensive income for the year, net of tax
-
-
-
-
Total comprehensive income for the year
-
-
(12,630,899)
(12,630,899)
Transactions with owners in their capacity as owners:
Contributions of equity, net of transaction costs
17,901,199
-
-
17,901,199
Contributions of equity, transfers from reserves
-
-
-
-
Balance at 30 June 2024
172,655,173
-
(153,837,160)
18,818,013
Australian Pacific Coal Limited
Statement of cash flows
For the year ended 30 June 2024
Consolidated
Note
2024
2023*
$
$
The above statement of cash flows should be read in conjunction with the accompanying notes
17
Cash flows from operating activities
Payments to suppliers and employees
(24,582,113)
(5,920,500)
Net interest (paid)/ received
(3,428,240)
40,009
Net cash from operating activities
31a
(28,010,353)
(5,880,491)
Cash flows from investing activities
Payments for property, plant and equipment
(1,678,491)
(109,150)
Payments for mining properties
(32,018,591)
-
(Payments for) / Refund of security bond/ deposits
(1,784,316)
500
Payments for exploration and evaluation
-
(174,422)
Loan advances
(2,982,901)
(13,845,903)
Net cash used in investing activities
(38,464,299)
(14,128,975)
Cash flows from financing activities
Contributions of equity, net of transaction costs
16,026,202
23,352,433
Proceeds from borrowings
64,648,238
-
Lease payments
(96,676)
-
Net cash used in financing activities
31b
80,577,764
23,352,433
Net increase/(decrease) in cash and cash equivalents
14,103,112
3,342,967
Cash and cash equivalents at the beginning of the financial
year
3,681,525
338,558
Cash and cash equivalents at the end of the financial year
7
17,784,637
3,681,525
*The comparative information for 2023 is reclassified into new categories where appropriate to align with 2024 disclosures
to reflect the Group’s nature of business under joint operation.
Australian Pacific Coal Limited
Notes to the financial statements
30 June 2024
18
Note 1. Material accounting policies
The principal accounting policies adopted in the preparation of the financial statements are set out below. These policies
have been consistently applied to all the years presented, unless otherwise stated.
New or amended Accounting Standards and Interpretations adopted
The Group has adopted all of the new or amended Accounting Standards and Interpretations issued by the Australian
Accounting Standards Board ('AASB') that are mandatory for the current reporting period.
Basis of preparation
These general purpose consolidated financial statements have been prepared in accordance with Australian Accounting
Standards and Interpretations issued by the Australian Accounting Standards Board ('AASB') and the Corporations Act 2001,
as appropriate for for-profit entities. These consolidated financial statements also comply with International Financial
Reporting Standards (IFRS) as issued by the International Accounting Standards Board ('IASB').
Historical cost convention
The consolidated financial statements have been prepared under the historical cost convention, except for, where applicable,
the revaluation of available-for-sale financial assets, financial assets and liabilities at fair value through profit or loss,
investment properties, certain classes of property, plant and equipment and derivative financial instruments.
Critical accounting estimates
The preparation of the consolidated financial statements requires the use of certain critical accounting estimates. It also
requires management to exercise its judgement in the process of applying the Group's accounting policies. The areas
involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the
financial statements, are disclosed in note 2.
Going Concern
The Group has incurred a net loss of $12,630,899 for the year ended 30 June 2024.
These consolidated financial statements have been prepared on a going concern basis as the Directors consider that the
Company and the Group will be able to realise its assets and settle its liabilities in the normal course of business and at
amounts stated in the consolidated financial statements. The continuation of the Company and the Group as a going concern
is dependent on their ability to achieve the following objectives:
●
Capital raisings or borrowings to support existing or new opportunities.
●
Successfully development, exploitation or advancement of the Dartbrook operation..
●
Realisation of surplus assets.
Should the above not generate the expected cash flows, the Company and the Group may not be able to pay its debts as
and when they become due and payable and it may be required to realise assets and extinguish liabilities other than in the
ordinary course of business and at amounts different from those stated in the consolidated financial statements. These
consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded
asset amounts and classification of liabilities that might be necessary should the Company and the Group not continue as
going concerns.
Parent entity information
In accordance with the Corporations Act 2001, these consolidated financial statements present the results of the Group only.
Supplementary information about the parent entity is disclosed in Note 28.
Principles of consolidation
The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Australian Pacific Coal
Limited ('Company' or 'parent entity') as at 30 June 2024 and the results of all subsidiaries for the year then ended. Australian
Pacific Coal Limited and its subsidiaries together are referred to in these consolidated financial statements as the 'Group'.
Subsidiaries
Subsidiaries are all those entities over which the Group has control. The Group controls an entity when the Group is exposed
to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its
power to direct the activities of the entity. Subsidiaries are fully consolidated from the date on which control is transferred to
the Group. They are de-consolidated from the date that control ceases.
Australian Pacific Coal Limited
Notes to the financial statements
30 June 2024
Note 1. Material accounting policies (continued)
19
Intercompany transactions, balances and unrealised gains on transactions between entities in the Group are eliminated.
Unrealised losses are also eliminated unless the transaction provides evidence of the impairment of the asset transferred.
Accounting policies of subsidiaries have been updated where necessary to ensure consistency with the policies adopted by
the Group.
The acquisition of subsidiaries is accounted for using the acquisition method of accounting. A change in ownership interest,
without the loss of control, is accounted for as an equity transaction, where the difference between the consideration
transferred and the book value of the share of the non-controlling interest acquired is recognised directly in equity attributable
to the parent.
Non-controlling interest in the results and equity of subsidiaries are shown separately in the statement of profit or loss and
other comprehensive income, statement of financial position and statement of changes in equity of the Group. Losses
incurred by the Group are attributed to the non-controlling interest in full, even if that results in a deficit balance.
Where the Group loses control over a subsidiary, it derecognises the assets including goodwill, liabilities and non-controlling
interest in the subsidiary together with any cumulative translation differences recognised in equity. The Group recognises
the fair value of the consideration received and the fair value of any investment retained together with any gain or loss in
profit or loss.
Joint arrangements
A joint arrangement is an arrangement over which the Group and one or more third parties have joint control. These joint
arrangements are in turn classified as:
Joint ventures whereby the Group has rights to the net assets of the arrangements, rather than rights to its assets
and obligations for its liabilities; and
Joint operations whereby the Group has rights to the assets and obligations for the liabilities relating to the
arrangement.
Interest in joint ventures (joint operation)
The Group’s interests in jointly controlled assets are accounted for by recognising its proportionate share in assets and
liabilities from joint ventures, except where as operator the Group takes on the role as independent contractor. In these
instances, receivables and payables relating to jointly controlled operations brought to account on a gross basis. Joint venture
expenses and the Group’s entitlement to production are recognised on a pro rata basis according to the Group’s interest.
Operating segments
Operating segments are presented using the 'management approach', where the information presented is on the same basis
as the internal reports provided to the Chief Operating Decision Makers ('CODM'). The CODM is responsible for the allocation
of resources to operating segments and assessing their performance.
Foreign currency translation
The financial statements are presented in Australian dollars, which is Australian Pacific Coal Limited’s functional and
presentation currency.
Foreign currency transactions
Foreign currency transactions are translated into Australian dollars using the exchange rates prevailing at the dates of the
transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation
at financial year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in
profit or loss.
Foreign operations
The assets and liabilities of foreign operations are translated into Australian dollars using the exchange rates at the reporting
date. The revenues and expenses of foreign operations are translated into Australian dollars using the average exchange
rates, which approximate the rates at the dates of the transactions, for the period. All resulting foreign exchange differences
are recognised in other comprehensive income through the foreign currency reserve in equity.
The foreign currency reserve is recognised in profit or loss when the foreign operation or net investment is disposed of.
Australian Pacific Coal Limited
Notes to the financial statements
30 June 2024
Note 1. Material accounting policies (continued)
20
Revenue recognition
The Group has applied AASB 15: Revenue from Contracts with Customers. The major components of revenue are
recognised as follows:
Interest
Interest revenue is recognised as interest accrues using the effective interest method. This is a method of calculating the
amortised cost of a financial asset and allocating the interest income over the relevant period using the effective interest rate,
which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to the
net carrying amount of the financial asset.
Other revenue
Other revenue is recognised when it is received or when the right to receive payment is established.
Income tax
The income tax expense or benefit for the period is the tax payable on that period's taxable income based on the applicable
income tax rate for each jurisdiction, adjusted by the changes in deferred tax assets and liabilities attributable to temporary
differences, unused tax losses and the adjustment recognised for prior periods, where applicable.
Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected to be applied when the
assets are recovered or liabilities are settled, based on those tax rates that are enacted or substantively enacted, except for:
●
When the deferred income tax asset or liability arises from the initial recognition of goodwill or an asset or liability in a
transaction that is not a business combination and that, at the time of the transaction, affects neither the accounting nor
taxable profits; or
●
When the taxable temporary difference is associated with interests in subsidiaries, associates or joint ventures, and the
timing of the reversal can be controlled and it is probable that the temporary difference will not reverse in the foreseeable
future.
Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that
future taxable amounts will be available to utilise those temporary differences and losses.
The carrying amount of recognised and unrecognised deferred tax assets are reviewed at each reporting date. Deferred tax
assets recognised are reduced to the extent that it is no longer probable that future taxable profits will be available for the
carrying amount to be recovered. Previously unrecognised deferred tax assets are recognised to the extent that it is probable
that there are future taxable profits available to recover the asset.
Deferred tax assets and liabilities are offset only where there is a legally enforceable right to offset current tax assets against
current tax liabilities and deferred tax assets against deferred tax liabilities; and they relate to the same taxable authority on
either the same taxable entity or different taxable entities which intend to settle simultaneously.
Australian Pacific Coal Limited (the 'head entity') and its wholly-owned Australian subsidiaries have formed an income tax
consolidated group under the tax consolidation regime. The head entity and each subsidiary in the tax consolidated group
continue to account for their own current and deferred tax amounts. The tax consolidated group has applied the 'separate
taxpayer within group' approach in determining the appropriate amount of taxes to allocate to members of the tax
consolidated group.
In addition to its own current and deferred tax amounts, the head entity also recognises the current tax liabilities (or assets)
and the deferred tax assets arising from unused tax losses and unused tax credits assumed from each subsidiary in the tax
consolidated group.
Assets or liabilities arising under tax funding agreements with the tax consolidated entities are recognised as amounts
receivable from or payable to other entities in the tax consolidated group. The tax funding arrangement ensures that the
intercompany charge equals the current tax liability or benefit of each tax consolidated group member, resulting in neither a
contribution by the head entity to the subsidiaries nor a distribution by the subsidiaries to the head entity.
Current and non-current classification
Assets and liabilities are presented in the statement of financial position based on current and non-current classification.
Australian Pacific Coal Limited
Notes to the financial statements
30 June 2024
Note 1. Material accounting policies (continued)
21
An asset is classified as current when: it is either expected to be realised or intended to be sold or consumed in the Group's
normal operating cycle; it is held primarily for the purpose of trading; it is expected to be realised within 12 months after the
reporting period; or the asset is cash or cash equivalent unless restricted from being exchanged or used to settle a liability
for at least 12 months after the reporting period. All other assets are classified as non-current.
A liability is classified as current when: it is either expected to be settled in the Group's normal operating cycle; it is held
primarily for the purpose of trading; it is due to be settled within 12 months after the reporting period; or there is no
unconditional right to defer the settlement of the liability for at least 12 months after the reporting period. All other liabilities
are classified as non-current.
Deferred tax assets and liabilities are always classified as non-current.
Cash and cash equivalents
Cash and cash equivalents include cash on hand, deposits held at call with financial institutions, other short-term, highly
liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and
which are subject to an insignificant risk of changes in value. For the statement of cash flows presentation purposes, cash
and cash equivalents also includes bank overdrafts, which are shown within borrowings in current liabilities on the statement
of financial position.
Trade and other receivables
Trade receivables are initially recognised at fair value and subsequently measured at amortised cost using the effective
interest method, less any provision for impairment. Trade receivables are generally due for settlement within 30 days.
Collectability of trade receivables is reviewed on an ongoing basis. Debts which are known to be uncollectable are written
off by reducing the carrying amount directly. A provision for impairment of trade receivables is raised when there is objective
evidence that the Group will not be able to collect all amounts due according to the original terms of the receivables. The
amount of the impairment allowance is the difference between the asset's carrying amount and the present value of estimated
future cash flows, discounted at the original effective interest rate. Cash flows relating to short-term receivables are not
discounted if the effect of discounting is immaterial.
The Group applies the simplified approach permitted by AASB 9 Financial Instruments, which requires expected lifetime
losses to be recognised from initial recognition of the receivables.
Inventories
Inventories are stated at the lower of cost and net realisable value on a 'first in first out' basis. Cost comprises direct materials
and delivery costs, direct labour, import duties and other taxes, an appropriate proportion of variable and fixed overhead
expenditure based on normal operating capacity, and, where applicable, transfers from cash flow hedging reserves in equity.
Costs of purchased inventory are determined after deducting rebates and discounts received or receivable.
Cost is determined on the following basis:
(a) Ore and other metals on hand is valued on an average total production cost method
(b) Ore stockpiles are valued at the average cost of mining and stockpiling the ore, including haulage
(c) A proportion of related depreciation and amortisation charge is included in the cost of inventory
Stock in transit is stated at the lower of cost and net realisable value. Cost comprises of purchase and delivery costs, net of
rebates and discounts received or receivable.
Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of completion
and the estimated costs necessary to make the sale.
Property, plant and equipment
Land and buildings are shown at historical cost. On any revaluation, accumulated depreciation at the date of revaluation is
eliminated against the gross carrying amount of the asset and the net amount is restated to the revalued amount of the asset.
Increases in the carrying amounts arising on revaluation of land and buildings are credited in other comprehensive income
through to the revaluation surplus reserve in equity. Any revaluation decrements are initially taken in other comprehensive
income through to the revaluation surplus reserve to the extent of any previous revaluation surplus of the same asset.
Thereafter the decrements are taken to profit or loss.
Australian Pacific Coal Limited
Notes to the financial statements
30 June 2024
Note 1. Material accounting policies (continued)
22
Plant and equipment is stated at historical cost less accumulated depreciation and impairment. Historical cost includes
expenditure that is directly attributable to the acquisition of the items.
Depreciation is calculated on a straight-line basis to write off the net cost of each item of property, plant and equipment
(excluding land) over their expected useful lives as follows:
Buildings
2 – 10 years
Leasehold improvements
40 years
Plant and equipment
1- 10 years
Land is not depreciated. The residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate,
at each reporting date.
An item of property, plant and equipment is derecognised upon disposal or when there is no future economic benefit to the
Group. Gains and losses between the carrying amount and the disposal proceeds are taken to profit or loss. Any revaluation
surplus reserve relating to the item disposed of is transferred directly to retained profits.
Exploration and evaluation assets
Exploration and evaluation expenditure in relation to separate areas of interest for which rights of tenure are current is carried
forward as an asset in the statement of financial position where it is expected that the expenditure will be recovered through
the successful development and exploitation of an area of interest, or by its sale; or exploration activities are continuing in
an area and activities have not reached a stage which permits a reasonable estimate of the existence or otherwise of
economically recoverable reserves. Where a project or an area of interest has been abandoned, the expenditure incurred
thereon is written off in the year in which the decision is made.
Mining properties
Capitalised mining development costs include expenditures incurred to develop new ore bodies to define further
mineralisation in existing ore bodies, to expand the capacity of a mine and to maintain production. Mining development also
includes costs transferred from exploration and evaluation phase once development of commercial production is approved.
Mining development is amortised on a units of production basis over the estimated proved and probable reserves, resulting
in an amortisation charge proportional to the depletion of the anticipated remaining life of mine production. Proved and
probable mineral reserves reflect estimated quantities of economically recoverable reserves which can be recovered in the
future from known mineral deposits. Changes in the annual amortisation rate resulting from changes in the remaining
estimated reserves, are applied on a prospective basis
Intangible assets
Intangible assets acquired as part of a business combination, other than goodwill, are initially measured at their fair value at
the date of the acquisition. Intangible assets acquired separately are initially recognised at cost. Indefinite life intangible
assets are not amortised and are subsequently measured at cost less any impairment. Finite life intangible assets are
subsequently measured at cost less amortisation and any impairment. The gains or losses recognised in profit or loss arising
from the derecognition of intangible assets are measured as the difference between net disposal proceeds and the carrying
amount of the intangible asset. The method and useful lives of finite life intangible assets are reviewed annually. Changes in
the expected pattern of consumption or useful life are accounted for prospectively by changing the amortisation method or
period.
Australian Pacific Coal Limited
Notes to the financial statements
30 June 2024
Note 1. Material accounting policies (continued)
23
Leases
The Group has lease contracts for various items of property, plant and equipment used within its operations and office
premises. The Group recognises right-of-use assets at the commencement date of the lease (i.e. the date the underlying
asset is available for use). Right-of-use assets are measured at cost, less any accumulated depreciation and impairment
losses, and adjusted for any remeasurement of lease liabilities. The cost of right-of-use assets includes the amount of lease
liabilities recognised, initial direct costs incurred, and lease payments made at or before the commencement date less any
lease incentives received. Unless the Group is reasonably certain to obtain ownership of the leased asset at the end of the
lease term, the recognised right-of-use assets are depreciated on a straight-line basis over the shorter of its estimated useful
life and the lease term. Right-of-use assets are presented in property, plant and equipment and are subject to impairment
assessment.
At the commencement date of the lease, the Group recognises lease liabilities measured at the present value of lease
payments to be made over the lease term. The lease payments include fixed payments (including in-substance fixed
payments) less any lease incentives receivable, variable lease payments that depend on an index or a rate, and amounts
expected to be paid under residual value guarantees. The lease payments also include the exercise price of a purchase
option reasonably certain to be exercised by the Group and payments of penalties for terminating a lease, if the lease term
reflects the Group exercising the option to terminate. The variable lease payments that do not depend on an index or a rate
are recognised as expense in the period on which the event or condition that triggers the payment occurs.
In calculating the present value of lease payments, the Group uses the incremental borrowing rate at the lease
commencement date if the interest rate implicit in the lease is not readily determinable. After the commencement date, the
amount of lease liabilities is increased to reflect the accretion of interest and reduced for the lease payments made. In
addition, the carrying amount of lease liabilities is remeasured if there is a modification, a change in the lease term, a change
in the in-substance fixed lease payments or a change in the assessment to purchase the underlying asset. Lease components
are separately identified to non-lease components of contracts where applicable.
Short-term Leases and Leases of Low-value Assets
The Group applies the short-term lease recognition exemption to its short-term leases (i.e., those leases that have a lease
term of 12 months or less from the commencement date and do not contain a purchase option). It also applies the low-value
asset recognition exemption to leases that are considered of low value. Lease payments on short-term leases and leases of
low-value assets are recognised as an expense on a straight-line basis over the lease term. During the year, the Group
incurred short-term lease expenses of $131,200 (2023: $32,800). The value of leases of low-value assets was not material.
Furthermore, the Group’s commitment for short-term leases not provided for in the financial statements at the reporting date
was not material.
Impairment of non-financial assets
Non-financial assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying
amount may not be recoverable. An impairment loss is recognised for the amount by which the asset's carrying amount
exceeds its recoverable amount.
Recoverable amount is the higher of an asset's fair value less costs of disposal and value-in-use. The value-in-use is the
present value of the estimated future cash flows relating to the asset using a pre-tax discount rate specific to the asset or
cash-generating unit to which the asset belongs. Assets that do not have independent cash flows are grouped together to
form a cash-generating unit.
Trade and other payables
These amounts represent liabilities for goods and services provided to the Group prior to the end of the financial year and
which are unpaid. They are recognised initially at fair value, and their carrying amount generally approximates to fair value
due to their short-term nature. The amounts are unsecured and are usually settled within 30 days of recognition. Where
settlement is not due in short term and where the effect is material, they are measured at amortised cost using the effective
interest method.
Borrowings
Loans and borrowings are initially recognised at the fair value of the consideration received, net of transaction costs. They
are subsequently measured at amortised cost using the effective interest method.
The component of the convertible notes that exhibits characteristics of a liability is recognised as a liability in the statement
of financial position, net of transaction costs.
Australian Pacific Coal Limited
Notes to the financial statements
30 June 2024
Note 1. Material accounting policies (continued)
24
On the issue of the convertible notes the fair value of the liability component is determined using a market rate for an
equivalent non-convertible bond and this amount is carried as a non-current liability on the amortised cost basis until
extinguished on conversion or redemption. The increase in the liability due to the passage of time is recognised as a finance
cost. The remainder of the proceeds are allocated to the conversion option that is recognised and included in shareholders
equity as a convertible note reserve, net of transaction costs. The carrying amount of the conversion option is not remeasured
in the subsequent years. The corresponding interest on convertible notes is expensed to profit or loss.
Finance costs
Finance costs attributable to qualifying assets are capitalised as part of the asset. All other finance costs are expensed in
the period in which they are incurred.
Provisions
Provisions are recognised when the Group has a present (legal or constructive) obligation as a result of a past event, it is
probable the Group will be required to settle the obligation, and a reliable estimate can be made of the amount of the
obligation. The amount recognised as a provision is the best estimate of the consideration required to settle the present
obligation at the reporting date, taking into account the risks and uncertainties surrounding the obligation. If the time value of
money is material, provisions are discounted using a current pre-tax rate specific to the liability.
Rehabilitation costs include the dismantling and removal of mining plant, equipment and building structures, waste removal
and rehabilitation of the site in accordance with the requirements of the mining permits and expectations from communities.
Such costs are determined using estimates of future costs, current legal requirements and technology.
Rehabilitation costs are recognised in full at present value as a non-current liability. An equivalent amount is capitalised as
part of the cost of the asset when an obligation arises to decommission or restore a site to a certain condition after
abandonment as a result of bringing the assets to its present location. The capitalised cost is amortised on a units of
production basis and the provision is accreted periodically as the discounting of the liability unwinds. The unwinding of the
discount is recorded as a finance cost.
Any changes in the estimates for the costs or other assumptions against the cost of relevant assets are accounted for 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.
Employee benefits
Short-term employee benefits
Liabilities for wages and salaries, including non-monetary benefits, annual leave and long service leave expected to be
settled wholly within 12 months of the reporting date are measured at the amounts expected to be paid when the liabilities
are settled.
Other long-term employee benefits
The liability for annual leave and long service leave not expected to be settled within 12 months of the reporting date are
measured at the present value of expected future payments to be made in respect of services provided by employees up to
the reporting date using the projected unit credit method. Consideration is given to expected future wage and salary levels,
experience of employee departures and periods of service. Expected future payments are discounted using market yields at
the reporting date on corporate bonds with terms to maturity and currency that match, as closely as possible, the estimated
future cash outflows.
Defined contribution superannuation expense
Contributions to defined contribution superannuation plans are expensed in the period in which they are incurred.
Share-based payments
Equity-settled and cash-settled share-based compensation benefits are provided to employees.
Equity-settled transactions are awards of shares, or options over shares, that are provided to employees in exchange for the
rendering of services. Cash-settled transactions are awards of cash for the exchange of services, where the amount of cash
is determined by reference to the share price.
Australian Pacific Coal Limited
Notes to the financial statements
30 June 2024
Note 1. Material accounting policies (continued)
25
The cost of equity-settled transactions is measured at fair value on grant date. Fair value is independently determined using
either the Binomial or Black-Scholes option pricing model that takes into account the exercise price, the term of the option,
the impact of dilution, the share price at grant date and expected price volatility of the underlying share, the expected dividend
yield and the risk free interest rate for the term of the option, together with non-vesting conditions that do not determine
whether the Group receives the services that entitle the employees to receive payment. No account is taken of any other
vesting conditions.
The cost of equity-settled transactions is recognised as an expense with a corresponding increase in equity over the vesting
period. The cumulative charge to profit or loss is calculated based on the grant date fair value of the award, the best estimate
of the number of awards that are likely to vest and the expired portion of the vesting period. The amount recognised in profit
or loss for the period is the cumulative amount calculated at each reporting date less amounts already recognised in previous
periods.
The cost of cash-settled transactions is initially, and at each reporting date until vested, determined by applying either the
Binomial or Black-Scholes option pricing model, taking into consideration the terms and conditions on which the award was
granted. The cumulative charge to profit or loss until settlement of the liability is calculated as follows:
●
during the vesting period, the liability at each reporting date is the fair value of the award at that date multiplied by the
expired portion of the vesting period.
●
from the end of the vesting period until settlement of the award, the liability is the full fair value of the liability at the
reporting date.
All changes in the liability are recognised in profit or loss. The ultimate cost of cash-settled transactions is the cash paid to
settle the liability.
Market conditions are taken into consideration in determining fair value. Therefore any awards subject to market conditions
are considered to vest irrespective of whether that market condition has been met, provided all other conditions are satisfied.
If equity-settled awards are modified, as a minimum an expense is recognised as if the modification has not been made. An
additional expense is recognised, over the remaining vesting period, for any modification that increases the total fair value
of the share-based compensation benefit as at the date of modification.
If the non-vesting condition is within the control of the Group or employee, the failure to satisfy the condition is treated as a
cancellation. If the condition is not within the control of the Group or employee and is not satisfied during the vesting period,
any remaining expense for the award is recognised over the remaining vesting period, unless the award is forfeited.
If equity-settled awards are cancelled, it is treated as if it has vested on the date of cancellation, and any remaining expense
is recognised immediately. If a new replacement award is substituted for the cancelled award, the cancelled and new award
is treated as if they were a modification.
Fair value measurement
When an asset or liability, financial or non-financial, is measured at fair value for recognition or disclosure purposes, the fair
value is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction
between market participants at the measurement date; and assumes that the transaction will take place either: in the principal
market; or in the absence of a principal market, in the most advantageous market.
Fair value is measured using the assumptions that market participants would use when pricing the asset or liability, assuming
they act in their economic best interests. For non-financial assets, the fair value measurement is based on its highest and
best use. Valuation techniques that are appropriate in the circumstances and for which sufficient data are available to
measure fair value, are used, maximising the use of relevant observable inputs and minimising the use of unobservable
inputs.
Assets and liabilities measured at fair value are classified, into three levels, using a fair value hierarchy that reflects the
significance of the inputs used in making the measurements. Classifications are reviewed at each reporting date and transfers
between levels are determined based on a reassessment of the lowest level of input that is significant to the fair value
measurement.
Australian Pacific Coal Limited
Notes to the financial statements
30 June 2024
Note 1. Material accounting policies (continued)
26
For recurring and non-recurring fair value measurements, external valuers may be used when internal expertise is either not
available or when the valuation is deemed to be significant. External valuers are selected based on market knowledge and
reputation. Where there is a significant change in fair value of an asset or liability from one period to another, an analysis is
undertaken, which includes a verification of the major inputs applied in the latest valuation and a comparison, where
applicable, with external sources of data.
Issued capital
Ordinary shares are classified as equity.
Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax,
from the proceeds.
Dividends
Dividends are recognised when declared during the financial year and no longer at the discretion of the Company.
Business combinations
The acquisition method of accounting is used to account for business combinations regardless of whether equity instruments
or other assets are acquired.
The consideration transferred is the sum of the acquisition-date fair values of the assets transferred, equity instruments
issued or liabilities incurred by the acquirer to former owners of the acquiree and the amount of any non-controlling interest
in the acquiree. For each business combination, the non-controlling interest in the acquiree is measured at either fair value
or at the proportionate share of the acquiree's identifiable net assets. All acquisition costs are expensed as incurred to profit
or loss.
On the acquisition of a business, the Group assesses the financial assets acquired and liabilities assumed for appropriate
classification and designation in accordance with the contractual terms, economic conditions, the Group's operating or
accounting policies and other pertinent conditions in existence at the acquisition-date.
Where the business combination is achieved in stages, the Group remeasures its previously held equity interest in the
acquiree at the acquisition-date fair value and the difference between the fair value and the previous carrying amount is
recognised in profit or loss.
Contingent consideration to be transferred by the acquirer is recognised at the acquisition-date fair value. Subsequent
changes in the fair value of the contingent consideration classified as an asset or liability is recognised in profit or loss.
Contingent consideration classified as equity is not remeasured and its subsequent settlement is accounted for within equity.
The difference between the acquisition-date fair value of assets acquired, liabilities assumed and any non-controlling interest
in the acquiree and the fair value of the consideration transferred and the fair value of any pre-existing investment in the
acquiree is recognised as goodwill. If the consideration transferred and the pre-existing fair value is less than the fair value
of the identifiable net assets acquired, being a bargain purchase to the acquirer, the difference is recognised as a gain directly
in profit or loss by the acquirer on the acquisition-date, but only after a reassessment of the identification and measurement
of the net assets acquired, the non-controlling interest in the acquiree, if any, the consideration transferred and the acquirer's
previously held equity interest in the acquirer.
Business combinations are initially accounted for on a provisional basis. The acquirer retrospectively adjusts the provisional
amounts recognised and also recognises additional assets or liabilities during the measurement period, based on new
information obtained about the facts and circumstances that existed at the acquisition-date. The measurement period ends
on either the earlier of (i) 12 months from the date of the acquisition or (ii) when the acquirer receives all the information
possible to determine fair value.
Earnings per share
Basic earnings per share
Basic earnings per share is calculated by dividing the profit attributable to the owners of Australian Pacific Coal Limited,
excluding any costs of servicing equity other than ordinary shares, by the weighted average number of ordinary shares
outstanding during the financial year, adjusted for bonus elements in ordinary shares issued during the financial year.
Australian Pacific Coal Limited
Notes to the financial statements
30 June 2024
Note 1. Material accounting policies (continued)
27
Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account the
after income tax effect of interest and other financing costs associated with dilutive potential ordinary shares and the weighted
average number of shares assumed to have been issued for no consideration in relation to dilutive potential ordinary shares.
Goods and Services Tax ('GST') and other similar taxes
Revenues, expenses and assets are recognised net of the amount of associated GST, unless the GST incurred is not
recoverable from the tax authority. In this case it is recognised as part of the cost of the acquisition of the asset or as part of
the expense.
Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of GST
recoverable from, or payable to, the tax authority is included in other receivables or other payables in the statement of
financial position.
Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities
which are recoverable from, or payable to the tax authority, are presented as operating cash flows.
Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the tax authority.
Rounding of amounts
The Company is of a kind referred to in Corporations Instrument 2016/191, issued by the Australian Securities and
Investments Commission, relating to 'rounding-off'. Amounts in this report have been rounded off in accordance with that
Corporations Instrument to the nearest dollar.
New or amended Accounting Standards and Interpretations adopted
The Group has adopted all of the new or amended Accounting Standards and Interpretations issued by the Australian
Accounting Standards Board ('AASB') that are mandatory for the current reporting period. The application of the new and
revised Standards and amendments did not have a material impact on the Group’s consolidated financial statements.
New and Amended Standards and Interpretations for Future Periods
Australian Accounting Standards and Interpretations that have recently been issued or amended but are not yet mandatory,
have not been early adopted by the Group for the annual reporting period ended 30 June 2024.
The Group has not yet assessed the impact of these new or amended Accounting Standards and Interpretations.
Note 2. Critical accounting judgements, estimates and assumptions
The preparation of the consolidated financial statements requires management to make judgements, estimates and
assumptions that affect the reported amounts in these consolidated financial statements. Management continually evaluates
its judgements and estimates in relation to assets, liabilities, contingent liabilities, revenue and expenses. Management bases
its judgements, estimates and assumptions on historical experience and on other various factors, including expectations of
future events, management believes to be reasonable under the circumstances. The resulting accounting judgements and
estimates will seldom equal the related actual results. The judgements, estimates and assumptions that have a significant
risk of causing a material adjustment to the carrying amounts of assets and liabilities (refer to the respective notes) within
the next financial year are discussed below.
Share-based payment transactions
The Group measures the cost of equity-settled transactions with employees by reference to the fair value of the equity
instruments at the date at which they are granted. The fair value is determined by using either the Binomial or Black-Scholes
model taking into account the terms and conditions upon which the instruments were granted. The accounting estimates and
assumptions relating to equity-settled share-based payments would have no impact on the carrying amounts of assets and
liabilities within the next annual reporting period but may impact profit or loss and equity.
Australian Pacific Coal Limited
Notes to the financial statements
30 June 2024
Note 2. Critical accounting judgements, estimates and assumptions (continued)
28
Provision for impairment of receivables
A simplified approach is adopted in relation to trade receivables, as the loss allowance is measured at lifetime expected
credit loss.
Allowance for expected credit losses
The allowance for expected credit losses assessment requires a degree of estimation and judgement. It is based on the
lifetime expected credit loss, grouped based on days overdue, and makes assumptions to allocate an overall expected credit
loss rate for each group. These assumptions include recent sales experience, historical collection rates and forward-looking
information that is available. The allowance for expected credit losses, as disclosed in note 8, is calculated based on the
information available at the time of preparation. The actual credit losses in future years may be higher or lower.
Provision for impairment of inventories
The provision for impairment of inventories assessment requires a degree of estimation and judgement. Costs incurred in or
benefits of the productive process are accumulated as stockpiles, copper and other metals in process, ore on leach pads
and product inventory. Net realisable value tests are performed at least annually and represent the estimated future sales
price of the product based on prevailing metal prices, less estimated costs to complete production and bring the product to
sale.
Stockpiles are measured by estimating the number of tonnes added and removed from the stockpile, the number contained
metal ounces based on assay data, and the estimated recovery percentage based on the expected processing method.
Stockpile tonnages are verified by periodic surveys.
Although the quantity of recoverable metal is reconciled by comparing the grades of the ore to the quantities of metals actually
recovered (metallurgical balancing), the nature of the process inherently limits the ability to precisely monitor recoverability
levels. As a result, the metallurgical balancing process is constantly monitored and the engineering estimates are refined
based on actual results over time.
Fair value measurement hierarchy
The Group is required to classify all assets and liabilities, measured at fair value, using a three level hierarchy, based on the
lowest level of input that is significant to the entire fair value measurement, being: Level 1: Quoted prices (unadjusted) in
active markets for identical assets or liabilities that the entity can access at the measurement date; Level 2: Inputs other than
quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly; and Level 3:
Unobservable inputs for the asset or liability. Considerable judgement is required to determine what is significant to fair value
and therefore which category the asset or liability is placed in can be subjective.
The fair value of assets and liabilities classified as level 3 is determined by the use of valuation models. These include
discounted cash flow analysis or the use of observable inputs that require significant adjustments based on unobservable
inputs.
Estimation of useful lives of assets
The Group determines the estimated useful lives and related depreciation and amortisation charges for its property, plant
and equipment and finite life intangible assets. The useful lives could change significantly as a result of technical innovations
or some other event. The depreciation and amortisation charge will increase where the useful lives are less than previously
estimated lives, or technically obsolete or non-strategic assets that have been abandoned or sold will be written off or written
down.
Australian Pacific Coal Limited
Notes to the financial statements
30 June 2024
Note 2. Critical accounting judgements, estimates and assumptions (continued)
29
Impairment of non-financial assets other than goodwill and other indefinite life intangible assets
The Group assesses impairment of non-financial assets other than goodwill and other indefinite life intangible assets at each
reporting date by evaluating conditions specific to the Group and to the particular asset that may lead to impairment. If an
impairment trigger exists, the recoverable amount of the asset is determined. This involves fair value less costs of disposal
or value-in-use calculations, which incorporate a number of key estimates and assumptions.
It is reasonably possible that the underlying metal price assumption may change which may then impact the estimated life
of mine determinant and may then require a material adjustment to the carrying value of mining assets. Furthermore, the
expected future cash flows used to determine the value-in-use of these assets are inherently uncertain and could materially
change over time. They are significantly affected by a number of factors including reserves and production estimates,
together with economic factors such as metal spot prices, discount rates, estimates of costs to produce reserves and future
capital expenditure.
Business combinations
The acquisition method is used to account for business combinations. The fair value of assets acquired, liabilities and
contingent liabilities are measured by the Group taking into consideration all acquisition costs at the reporting date. Fair value
adjustments on the finalisation of the business combination accounting is retrospective, where applicable, to the period the
combination occurred and may have an impact on the assets and liabilities, depreciation and amortisation reported.
Income tax
The Group is subject to income taxes in the jurisdictions in which it operates. Significant judgement is required in determining
the provision for income tax. There are many transactions and calculations undertaken during the ordinary course of business
for which the ultimate tax determination is uncertain. The Group recognises liabilities for anticipated tax audit issues based
on the Group's current understanding of the tax law. Where the final tax outcome of these matters is different from the
carrying amounts, such differences will impact the current and deferred tax provisions in the period in which such
determination is made.
Recovery of deferred tax assets
Deferred tax assets are recognised for deductible temporary differences only if the Group considers it is probable that future
taxable amounts will be available to utilise those temporary differences and losses.
Employee benefits provision
As discussed in note 1, the liability for employee benefits expected to be settled more than 12 months from the reporting
date are recognised and measured at the present value of the estimated future cash flows to be made in respect of all
employees at the reporting date. In determining the present value of the liability, estimates of attrition rates and pay increases
through promotion and inflation have been taken into account.
Rehabilitation provision
A provision has been made for the present value of anticipated costs for future rehabilitation of land explored or mined. The
Group's mining and exploration activities are subject to various laws and regulations governing the protection of the
environment. The Group recognises management's best estimate for assets retirement obligations and site rehabilitations in
the period in which they are incurred. Actual costs incurred in the future periods could differ materially from the estimates.
Additionally, future changes to environmental laws and regulations, life of mine estimates and discount rates could affect the
carrying amount of this provision.
Australian Pacific Coal Limited
Notes to the financial statements
30 June 2024
Note 2. Critical accounting judgements, estimates and assumptions (continued)
30
Exploration and evaluation costs
Exploration and evaluation costs have been capitalised on the basis that the Group will commence commercial production
in the future. Key judgements are applied in considering costs to be capitalised which includes determining expenditures
directly related to these activities and allocating overheads between those that are expensed and capitalised. In addition,
costs are only capitalised that are expected to be recovered either through successful development or sale of the relevant
mining interest. Factors that could impact the future commercial production at the mine include the level of reserves and
resources, future technology changes, which could impact the cost of mining, future legal changes and changes in commodity
prices. To the extent that capitalised costs are determined not to be recoverable in the future, they will be written off in the
period in which this determination is made.
Vendor royalty provision
A provision was made for the present value of the anticipated production royalty payable to the vendors of the Dartbrook
Mine. The net present value adopted is lower than the full nominal amount of the vendor royalty to reflect, amongst other
things, the risk and probability associated with the progress of recommencing mining operations and the consequential time
value of the royalty payment stream. Accordingly, the vendor royalty in excess of the recognised net present value amount
is a contingent liability, with remeasurement at each annual reporting period to reflect the then-current probability weighted
estimate of incurring royalty payments to the vendors.
Note 3. Operating segments
Identification of reportable operating segments
The determination of the Group’s operating segments is based on the reporting units for which information is reported to the
Board of Directors (who are identified as the Chief Operating Decision Makers (“CODM”). The Group’s reportable segments
are based on the nature of the operation. There is no aggregation of operating segments.
The CODM reviews segment receipts and expenditure for each operating segment at each board meeting. The accounting
policies adopted for internal reporting to the CODM are consistent with those adopted in the financial statements.
Types of products and services
The principal products and services of each of these operating segments are as follows:
Dartbrook
The segment seeks to manage the development of the Dartbrook mine where the Group
holds an 80% working interest through an unincorporated joint venture (joint operation).
Corporate
The corporate segment supports primarily the Dartbrook Joint Venture and other potential
exploration and evaluation activities.
Financial information
Net gain (loss) from
continuing operations
before tax
Total Assets
2024
2023*
2024
2023*
$
$
$
$
Dartbrook/ Exploration & Evaluation
(22,575,784)
(4,069,736)
83,556,562
34,746,329
Other (Head office)
9,944,885
(8,447,897)
18,906,122
3,339,838
(12,630,899)
(12,517,633)
102,462,684
38,086,167
*Joint operation assessment not concluded for the nature of the Dartbrook Joint Venture for the financial year ended 30
June 2023.
Australian Pacific Coal Limited
Notes to the financial statements
30 June 2024
31
Note 4. Revenue – other income
Consolidated
2024
2023
$
$
Other revenue
Interest
1,093,632
319,715
Other income
301,305
-
Net foreign exchange gain
1,142,014
-
2,536,951
319,715
Note 5. Expenses
Consolidated
2024
2023
$
$
Loss before income tax includes the following expenses:
Exploration and evaluation expense
764,217
2,114,251
Depreciation
1,186,086
1,029,053
Interest expense on lease liabilities
96,200
-
Interest and finance charges paid/payable
3,859,270
5,543,289
Comparative information for the financial year ended 30 June 2023 has been reclassified into new categories where
appropriate to align with 2024 disclosures to reflect the Group’s nature of business under joint operation, with no changes to
the underlying accounting. Employee benefit expenses, exploration and evaluation expenses and administration and
consulting expenses disclosed in prior year were re-classified as site and corporate overheads on the face of the profit and
loss.
Note 6. Income tax expense
Consolidated
2024
2023
$
$
Numerical reconciliation of income tax expense and tax at the statutory rate
Profit before income tax expense from continuing operations
(12,630,899)
(12,517,630)
Profit before income tax expense from discontinued operations
(12,630,899)
(12,517,630)
Tax at the statutory tax rate of 30%
(3,789,270)
(3,755,289)
Tax effect amounts which are not deductible/(taxable) in calculating taxable income:
Depreciation and amortisation
318,175
308,716
Entertainment expense
-
695
Other non-allowable items
(2,630,726)
2,066,222
Other allowable items
(1,735,666)
(12,641,176)
(7,837,487)
(14,020,832)
Tax losses and temporary differences not brought to account
7,837,487
14,020,832
Income tax expense
-
-
Australian Pacific Coal Limited
Notes to the financial statements
30 June 2024
32
Note 7. Current assets - cash and cash equivalents
Consolidated
2024
2023
$
$
Cash at bank and on hand
17,784,637
3,681,525
17,784,637
3,681,525
Cash and cash equivalents as at 30 June 2024 includes the Group’s share of cash in the joint operation amounting to
$16,318,451(note 25).
Note 8. Current assets - trade and other receivables
Consolidated
2024
2023
$
$
Trade and other receivables
1,612,126
340,301
Less: Allowance for expected credit loss
-
-
1,612,126
340,301
As at 30 June 2024, $nil of the trade and other receivables were past due (2023: $nil). All trade and other receivables are
deemed as low risk and collectible on the basis of established credit management processes such as regular analyses of their
credit worthiness and external credit checks where appropriate.
Note 9. Loans receivable
Consolidated
2024
2023
$
$
Receivables from joint operation partners
9,385,150
-
Advances for Dartbrook Coal Project
-
16,022,782
9,385,150
16,022,782
Current
1,200,000
16,022,782
Non-current
8,185,150
-
9,385,150
16,022,782
By the end of prior year the Group executed a restructured Joint Venture agreement underpinning the restart of the Dartbrook
underground coal mine. The agreement falls into the category of joint operations where the participants in the agreement
are entitled to a share of all the assets, obligations and liabilities of the operations, rather than a share of the net assets.
Since then the advances for Dartbrook Coal Project has been reclassified and allocated across different classes of assets
and liabilities based on the Group’s interest. The remaining balance represents loan receivables from the Group’s joint
operation partners. The Group anticipates these funds will be repaid over time from excess cash generated from operation.
Interest is charged at a margin above benchmark rates.
Australian Pacific Coal Limited
Notes to the financial statements
30 June 2024
33
Note 10. Current assets – other
Consolidated
2024
2023
$
$
Security bond
27,542
16,400
Accrued Interest
-
279,706
Prepayments
2,170,965
101,227
2,198,507
397,333
Note 11. Non-current assets - property, plant and equipment
Consolidated
2024
2023
$
$
Land and buildings - at cost
922,723
850,786
Less: Accumulated depreciation
(173,641)
(139,134)
749,082
711,652
Leasehold improvements - at cost
180,217
180,217
Less: Accumulated depreciation
(172,058)
(171,826)
8,159
8,391
Plant and equipment - at cost
11,573,555
8,302,290
Less: Accumulated depreciation
(7,296,774)
(6,270,932)
4,276,781
2,031,358
5,034,022
2,751,401
Reconciliations
Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out
below:
Land and
Leasehold
Plant and
buildings
improvements
equipment
Total
Consolidated
$
$
$
$
Balance at 1 July 2022
717,451
8,623
3,015,230
3,741,304
Additions
-
-
109,150
109,150
Disposals
-
-
-
-
Impairment
-
-
(70,000)
(70,000)
Available for Sale
-
-
-
-
Depreciation expense
(5,799)
(232)
(1,023,022)
(1,029,053)
Balance at 30 June 2023
711,652
8,391
2,031,358
2,751,401
Additions
71,937
-
3,271,266
3,343,203
Disposals
-
-
-
-
Impairment
-
-
-
-
Available for Sale
-
-
-
-
Depreciation expense
(34,507)
(232)
(1,025,843)
(1,060,582)
Balance at 30 June 2024
749,082
8,159
4,276,781
5,034,022
Australian Pacific Coal Limited
Notes to the financial statements
30 June 2024
34
Note 12. Non-current assets - exploration and evaluation
Consolidated
2024
2023
$
$
Exploration and evaluation - at cost
-
5,894,592
Reconciliations
Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out
below:
Exploration
and
Consolidated
evaluation
$
Balance at 1 July 2022
5,720,170
Additions
174,422
Balance at 30 June 2023
5,894,592
99,757
Transfer to Mining properties (note 13)
(5,994,349)
Balance at 30 June 2024
-
Exploration and evaluation 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 which permits reasonable assessment of the existence of
economically recoverable resources and active or significant operations in relation to the area are continuing.
During the year, the Dartbrook Joint Venture has advanced to development stage and work has been performed on site to
prepare for mining operations and production. The exploration and evaluation expenditure previously recognised is therefore
transferred to mining properties (Note 13).
Australian Pacific Coal Limited
Notes to the financial statements
30 June 2024
35
Note 13. Non-current assets – Mining properties
Consolidated
2024
2023
$
$
Mining properties - at cost
55,570,567
-
Reconciliations
Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out
below:
Mining
properties
Consolidated
$
Balance at 1 July 2022
-
Additions
-
Balance at 30 June 2023
-
Additions
49,576,218
Transfer from Exploration and evaluation expenditure (note 12)
5,994,349
Balance at 30 June 2024
55,570,567
Mining properties in the year included tunnel dewatering, civil works for installation of the new conveyor system, and
additional equipment in preparation of restarting operations at the Dartbrook mine, where the Group holds an 80% working
interest through its joint operation.
Assets linked to the Dartbrook Joint Venture are pledged as security for the borrowings the Group obtained in the year (see
Note 20).
Australian Pacific Coal Limited
Notes to the financial statements
30 June 2024
36
Note 14. Non-current assets – right-of-use assets
Consolidated
2024
2023
$
$
Land and buildings - at cost
1,826,214
-
Less: Accumulated depreciation
(27,174)
-
1,799,040
-
Plant and equipment - at cost
1,179,972
-
Less: Accumulated depreciation
(98,330) -
1,081,642
-
2,880,682
-
Reconciliations
Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out
below:
Land and
Plant and
Buildings
Right-of-use
Equipment
Right-of-use
Total
Consolidated
$
$
$
Balance at 1 July 2022
-
-
-
Balance at 30 June 2023
-
-
-
Additions
1,826,214
1,179,972
3,006,186
Depreciation expense
(27,174)
(98,330) (125,504)
Balance at 30 June 2024
1,799,040
1,081,642
2,880,682
The Group leases a number of assets through its interests in the joint operation. This primarily includes electrical equipment
and residential units.
Amount recognised in profit and loss
Consolidated
2024
2023
$
$
Expenses relating to short-term leases for which recognition exemption is applied
131,200
32,800
Expenses relating to leases of low value assets for which recognition exemption is applied
-
-
Income from subleasing right-of-use assets
-
-
Australian Pacific Coal Limited
Notes to the financial statements
30 June 2024
37
Note 15. Non-current assets - deferred tax
Consolidated
2024
2023
$
$
Deferred tax asset comprises temporary differences attributable to:
Amounts recognised in profit or loss
344,763
403,246
Tax losses – operating losses
40,366,701
32,529,214
Tax losses – capital losses
571,618
571,618
Dartbrook Mine Acquisition
8,109,138
7,765,641
Tax assets not brought to account
(49,392,220)
(41,269,719)
Deferred tax asset
-
-
Note 16. Non-current assets – other
Consolidated
2024
2023
$
$
Cash on deposit for bank facilities
25,000
25,000
Security deposits
7,971,993
8,973,233
7,996,993
8,998,233
Security deposits included a cash payment of $8,950,000 (gross) made in prior years to the NSW government as
rehabilitation security deposits in relation to the Dartbrook Joint Venture, as required under relevant laws and assessed by
the relevant NSW government department. A re-assessment of the security deposit required was completed during the year
and an additional $491,000 (gross) security was provided to the NSW government. Balance as at year ended 30 June 2024
reflects the Group’s share of the deposits through its interest in the Dartbrook Joint Venture.
Note 17. Current liabilities - trade and other payables
Consolidated
2024
2023
$
$
Trade and other payables
13,550,623
4,369,516
Payroll and on-costs payables
241,558
127,938
13,792,181
4,497,454
Refer to note 21 for further information on financial instruments.
Australian Pacific Coal Limited
Notes to the financial statements
30 June 2024
38
Note 18. Provisions
Consolidated
2024
2023
$
$
Non-Current:
Rehabilitation provision
7,562,800
9,441,000
Vendor Royalty provision (Note 25)
9,360,000
10,600,000
16,922,800
20,041,000
Reconciliation of movements:
Rehabilitation
provision
Vendor Royalty
provision
Total
Consolidated
$
$
$
Balance at 1 July 2022
8,950,000
10,600,000
19,550,000
Adjustment for change in estimates
491,000
-
491,000
Balance at 30 June 2023
9,441,000
10,600,000
20,041,000
Adjustment for change in estimates
(1,878,200)
(1,240,000)
(3,118,200)
Balance at 30 June 2024
7,562,800
9,360,000
16,922,800
Rehabilitation
The provision for rehabilitation closure costs relate to a present assessment to reinstate disturbed areas in accordance with
the Dartbrook mining consent. Provision has been made to rehabilitate all areas of disturbance including surface
infrastructure, buildings, underground mine workings and underground entries, using internal and external expert
assessment of each aspect to calculate an anticipated cash outflow discounted to a net present value. At each reporting date
the rehabilitation provision is re-measured in line with the then-current level of disturbance, cost estimates and other key
inputs. Adjustments were made in the year to reflect Group’s share of liabilities in the Dartbrook Joint Venture under joint
operation arrangement. Refer to Note 29 for details.
An equivalent amount of cash for the gross provision was deposited in full to the NSW government as rehabilitation security
deposits, refer to note 16 for details.
The Group will continue to assess the available and efficient rehabilitation options in parallel with the development of the
mine.
Vendor Royalty
On 7 June 2016 the Group announced it had reached agreement with the minority joint venture partner at Dartbrook to
acquire the minority partner’s stake, thereby taking the Company’s ownership of Dartbrook to 100% at the time. A combined
contingent royalty arrangement was agreed with the vendors on the following terms:
An aggregate royalty to the vendors at a rate of A$3.00 per tonne of coal sold or otherwise disposed of and A$0.25
per tonne of any third-party coal processed through the Dartbrook infrastructure, capped at A$30 million with
indexation to apply to the rate and the cap.
The vendor royalty is reliant on the Dartbrook Joint Venture achieving future development milestones which may or may not
occur. The maximum amount payable under the product-based royalty remains capped at $30 million with indexation to apply
to the cap. The net present value amounting to $9,360,000 (2023: $10,600,000) recognised at year end is lower than the full
nominal amount to reflect, amongst other things, the risk and time value of the royalty payment stream.
Australian Pacific Coal Limited
Notes to the financial statements
30 June 2024
39
Note 19. Equity - issued capital
Consolidated
2024
2023
2024
2023
Shares
Shares
$
$
Ordinary shares - fully paid
533,800,924
347,310,953
172,655,173
154,753,974
Details
Date
Shares
$
Balance
1 July 2023
347,310,953
154,753,974
Share issue – rights issue (institutional)
7 September 2023
54,166,737
5,958,341
Placement
7 September 2023
36,363,636
4,000,000
Share issue – rights issue (retail)
9 October 2023
18,181,818
2,000,000
Placement
2 January 2024
56,944,447
5,125,000
Placement
18 June 2024
20,833,333
1,875,000
Share issue costs
(1,057,142)
Balance
30 June 2024
533,800,924
172,655,173
Ordinary shares
Ordinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the Company in proportion
to the number of and amounts paid on the shares held. The fully paid ordinary shares have no par value and the Company
does not have a limited amount of authorised capital.
On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each
share shall have one vote.
Share buy-back
There is no current on-market share buy-back.
Australian Pacific Coal Limited
Notes to the financial statements
30 June 2024
40
Note 19. Equity - issued capital (continued)
Capital risk management
The Group's objectives when managing capital is to safeguard its ability to continue as a going concern, so that it can provide
returns for shareholders and benefits for other stakeholders and to maintain an optimum capital structure to reduce the cost
of capital.
Capital is regarded as total equity, as recognised in the statement of financial position, plus net debt. Net debt is calculated
as total borrowings less cash and cash equivalents.
In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, return
capital to shareholders, issue new shares or sell assets to reduce debt.
The Group would look to raise capital when an opportunity to invest in a business or company was seen as value adding
relative to the current company's share price at the time of the investment. The Group is not actively pursuing additional
investments in the short term as it continues to integrate and grow its existing businesses in order to maximise synergies.
The Group is subject to certain financing arrangements covenants and meeting these is given priority in all capital risk
management decisions. There have been no events of default on the financing arrangements during the financial year.
The capital risk management policy remains unchanged.
Note 20. Non-current liabilities - borrowings
Consolidated
2024
2023
$
$
Interest bearing borrowings
47,020,181
-
Interest bearing borrowings due to related parties
3,000,000
-
50,020,181
-
The Group had a $3 million loan facility provided by Trepang Service Pty outstanding as at 30 June 2024. The Group has
agreed to provide security which has been subordinated to the senior finance facilities. The loan attracts interest at a rate of
10% per annum and to be repaid post settlement of senior finance facilities.
The Group, together with its partner on the Dartbrook Joint Venture, had entered into a 3- year loan facility of US$60 million
with Vitol Asia Pte Limited in the year. The loan is expected to cover forecast restart expenditure at Dartbrook through to first
coal. The loan is secured on customary terms and bears interest at a margin above benchmark rates. Repayment will be
made over the period with final repayment date on 31 December 2026.
Note 21. Financial instruments
Financial risk management objectives
The Group's activities expose it to a variety of financial risks: market risk (including foreign currency risk, price risk and
interest rate risk), credit risk and liquidity risk. The Group's overall risk management program focuses on the unpredictability
of financial markets and seeks to minimise potential adverse effects on the financial performance of the Group. The Group
uses different methods to measure different types of risk to which it is exposed. These methods include sensitivity analysis
in the case of interest rate and other price risks, ageing analysis for credit risk.
Risk management is carried out by the Chief Executive Officer ('CEO') under policies approved by the Board of Directors
('the Board'). These policies include identification and analysis of the risk exposure of the Group and appropriate procedures,
controls and risk limits. The CEO identifies, evaluates and hedges financial risks within the Group's operating units. The CEO
reports to the Board on a regular basis.
Australian Pacific Coal Limited
Notes to the financial statements
30 June 2024
Note 21: Financial instruments (continued)
41
Market risk
Foreign currency risk
The Group is not currently exposed to foreign currency risk.
Price risk
The Group is not currently exposed to price risk.
Interest rate risk
Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes
in market interest rates. The Group’s exposure to the risks of changes in market interest rates relates primarily to the Group’s
share in the Dartbrook Joint Venture long-term debt obligations with floating interest rates.
Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the
Group. Credit risk is managed through the maintenance of procedures (such procedures include the utilisation of systems
for the approval, granting and renewal of credit limits, regular monitoring of exposures against such limits and monitoring of
the financial stability of significant customers and counterparties), ensuring to the extent possible, that customers and
counterparties to transactions are of sound credit worthiness. Such monitoring is used in assessing receivables for
impairment. Depending on the division within the Group, credit terms are generally 14 to 30 days from the invoice date.
The maximum exposure to credit risk at the reporting date to recognised financial assets is 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. The Group does not hold any collateral.
The Group has no significant concentration of credit risk with any single counterparty or group of counterparties.
Liquidity risk
Vigilant liquidity risk management requires the Group to maintain sufficient liquid assets (mainly cash and cash equivalents)
and available borrowing facilities to be able to pay debts as and when they become due and payable.
The Group manages liquidity risk by maintaining adequate cash reserves and available borrowing facilities by continuously
monitoring actual and forecast cash flows and matching the maturity profiles of financial assets and liabilities.
Remaining contractual maturities
The following tables detail the Group's remaining contractual maturity for its financial instrument liabilities. The tables have
been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the financial
liabilities are required to be paid. The tables include both interest and principal cash flows disclosed as remaining contractual
maturities and therefore these totals may differ from their carrying amount in the statement of financial position.
Weighted
average
interest rate
1 year or less
Between 1
and 2 years
Between 2
and 5 years
Over 5
years
Remaining
contractual
maturities
Consolidated – 2024
%
$
$
$
$
$
Non-derivatives
Non-interest bearing
Trade and other payables
13,792,181
-
-
-
13,792,181
Lease liabilities
955,464
955,464
1,621,068
-
3,531,996
Interest-bearing
Secured loans
20.40%
11,178,310
69,522,912
-
-
80,701,222
Unsecured loans
10.00%
-
-
4,536,904
-
4,536,904
Total non-derivatives
25,943,936
70,478,376
6,157,972
-
102,580,284
Australian Pacific Coal Limited
Notes to the financial statements
30 June 2024
Note 21: Financial instruments (continued)
42
Weighted
average
interest rate
1 year or less
Between 1
and 2 years
Between 2
and 5 years
Over 5 years
Remaining
contractual
maturities
Consolidated - 2023
%
$
$
$
$
$
Non-derivatives
Non-interest bearing
Trade and other payables
-
4,497,454
-
-
-
4,497,454
The cash flows in the maturity analysis above are not expected to occur significantly earlier than contractually disclosed
above.
Fair value of financial instruments
Unless otherwise stated, the carrying amounts of financial instruments reflect their fair value.
Note 22. Key management personnel disclosures
Compensation
The aggregate compensation made to Directors and other members of key management personnel of the Group is set out
below:
Consolidated
2024
2023
$
$
Short-term employee benefits
764,027
975,146
Share-based payments
-
-
Post-employment benefits
10,605
5,250
774,632
980,396
Note 23. Remuneration of auditors
During the financial year the following fees were paid or payable for services provided by Hall Chadwick Chartered
Accountants, the auditor of the company, its network firms and unrelated firms:
Consolidated
2024
2023
$
$
Audit services – Hall Chadwick Chartered Accountants
Audit or review of the financial statements
92,920
102,500
Audit or review of the financial statements of Dartbrook Joint Venture
52,000
-
Other services – Hall Chadwick Chartered Accountants
Preparation of the tax return
11,500
15,437
156,420
117,937
Australian Pacific Coal Limited
Notes to the financial statements
30 June 2024
43
Note 24. Lease liabilities
Consolidated
2024
2023
$
$
Current liabilities
Plant and equipment
334,554
-
Land and buildings
179,677
-
514,231
-
Non-current liabilities
Plant and equipment
771,645
-
Land and buildings
1,623,633 -
2,395,278
-
2,909,509
-
The Group leases a number of assets through its interest in the joint operation. This primarily includes electrical equipment
and residential units. Refer to note 21 for future lease payments in relation to the lease liabilities.
The total cash outflow for leases in 2024 was 96,676 (2023: $nil).
Note 25. Contingent liabilities
Vendor Royalty
On 7 June 2016 the Group announced it had reached agreement with the minority joint venture partner at Dartbrook to acquire
the minority partner’s stake, thereby taking the Company’s ownership of Dartbrook to 100%. A combined contingent royalty
arrangement was agreed with the vendors on the following terms:
An aggregate royalty to the vendors at a rate of A$3.00 per tonne of coal sold or otherwise disposed of and A$0.25
per tonne of any third-party coal processed through the Dartbrook infrastructure, capped at A$30 million with
indexation to apply to the rate and the cap.
The vendor royalty is reliant on the Joint Venture achieving future development milestones which may or may not occur. The
maximum amount payable under the product-based royalty remains capped at $30 million (on 100% basis) with indexation to
apply to the cap. The net present value adopted is lower than the full nominal amount to reflect, amongst other things, the risk
and time value of the royalty payment stream. The liability has been assessed at $9.4 million net to the Group’s share (refer
to note 18).
The net present value adopted is based on the Group’s 80% working interest in the Dartbrook Joint Venture on the basis that
the project is bought into production under the current arrangements. Should this not occur, the liability recognised may be
lower than it would be on a 100% basis. The additional amount represents a contingent liability, with remeasurement likely to
occur under appropriate circumstances.
Royalty for Existing Financiers
On 22 January 2024 the Group announced that the Dartbrook Joint Venture had finalised a 3-year USD60 million (~AUD90
million) debt facility with Vitol Asia Pte Ltd (“Vitol”), a leading global energy and commodities company.
In parallel with the debt facilities, the Dartbrook Joint Venture entered into royalty deed with Vitol and included the following
potential royalties payable to the Financiers:
Financiers will receive a 2% of the gross revenue from the sale of all coal produced by the Dartbrook Mine.
The royalty is reliant on the Dartbrook Joint Venture achieving future development milestones which may or may not occur.
Australian Pacific Coal Limited
Notes to the financial statements
30 June 2024
44
Note 25. Contingent liabilities (continued)
Disagreement with advisory firm
An advisory firm previously engaged to assist the Company obtain debt funding has claimed it is entitled to unlisted options
of the Company. The Company disputed the advisory firm’s entitlement to receive these options (as well as the coal royalty
and quantum of the cash amount). There is a risk that advisory firm will ultimately seek to require the Company to either issue
some or all of the options or provide money to compensate for the fact that they have not been issued, and may also seek to
recover its costs for pursuing its claims in this regard. The contingent liability has not been recognised because it is contingent
on future developments on the disagreement which remains uncertain.
Note 26. Contingent asset
On 27 September 2022, the Group announced that it had agreed and signed a terms sheet for a deal to re-commission the
Dartbrook Coal Project alongside Trepang Services Pty Ltd, M Resources Pty Ltd and Tetra Resources Pty Ltd (Dartbrook
Joint Venture). On 1 May 2023, the Group announced that the term sheet signed in September 2022 had been renegotiated
and a new arrangement would see AQC increase its direct working interest in the project from 50% to 80% and its net
economic interest increase from 50% to 70%.
Amongst other matters contemplated, the agreements provide for the Group to be reimbursed certain costs from the Dartbrook
Joint Venture out of future development funding obtained. The reimbursement is contingent on net cash generated once other
financial obligations are met. At reporting date the Group has determined that the quantum of costs to be potentially reimbursed
up to 30 June 2024 of approximately $4.7m (gross).
Note 27. Related party transactions
Parent entity
Australian Pacific Coal Limited is the parent entity.
Subsidiaries
Interests in subsidiaries are set out in note 29.
Key management personnel
Disclosures relating to key management personnel are set out in note 22 and the remuneration report included in the
Directors' report.
Receivable from and payable to related parties
There are no outstanding balances at the reporting date in relation to transactions with related parties.
Terms and conditions
All transactions were made on normal commercial terms and conditions and at market rates.
Australian Pacific Coal Limited
Notes to the financial statements
30 June 2024
45
Note 28. Parent entity information
Set out below is the supplementary information about the parent entity.
Statement of profit or loss and other comprehensive income
Parent
2024
2023
$
$
Profit/ (Loss) after income tax
2,713,110
(7,837,692)
Total comprehensive income/ (loss)
2,713,110
(7,837,692)
Statement of financial position
Parent
2024
2023
$
$
Total current assets
7,440,570
3,246,213
Total assets
81,302,321
10,705,040
Total current liabilities
(1,069,396)
403,540
Total liabilities
(4,069,396)
403,540
Equity
Issued capital
172,655,173
154,753,971
Share based payment reserve
Accumulated deficits
(95,422,248)
(141,206,258)
Total equity
77,232,925
13,547,713
Guarantees entered into by the parent entity in relation to the debts of its subsidiaries
The parent entity has entered into a guarantee in connection with the Group’s purchase of the Dartbrook coal mine.
The parent entity has entered into a guarantee in connection with the Group’s interest in the Dartbrook Joint Venture.
The parent entity has not entered into any other guarantees, in the current or previous financial year, in relation to the debts
of its subsidiaries.
Contingent liabilities
The parent entity had no contingent liabilities as at 30 June 2024 other than disclosed at note 25.
Capital commitments - Property, plant and equipment
The parent entity had no capital commitments for property, plant and equipment as at 30 June 2024.
Significant accounting policies
The accounting policies of the parent entity are consistent with those of the Group, as disclosed in note 1, except for the
following:
●
Investments in subsidiaries are accounted for at cost, less any impairment, in the parent entity.
Australian Pacific Coal Limited
Notes to the financial statements
30 June 2024
46
Note 29. Interests in subsidiaries and joint arrangements
Subsidiaries
The consolidated financial statements incorporate the assets, liabilities and results of the following wholly-owned subsidiaries
in accordance with the accounting policy described in Note 1:
Ownership interest
Principal place of business /
2024
2023
Name
Country of incorporation
%
%
AQC Investments 1 Pty Ltd
Australia
100.00%
100.00%
AQC Investments 2 Pty Ltd
Australia
100.00%
100.00%
Area Coal Pty Ltd
Australia
100.00%
100.00%
AQC Services Pty Ltd
Australia
100.00%
100.00%
AQC Dartbrook Pty Ltd
Australia
100.00%
100.00%
AQC Dartbrook Management Pty Ltd
Australia
100.00%
100.00%
Dartbrook Coal (Sales) Pty Ltd
Australia
100.00%
100.00%
Ipoh Pacific Resources Pty Ltd
Australia
100.00%
100.00%
Felix St Pty Ltd
Australia
100.00%
100.00%
IPR Operations Pty Ltd
Australia
100.00%
100.00%
Mining Investments One Pty Ltd
Australia
100.00%
100.00%
Joint Operation
The Group holds an 80% working interest in the Dartbrook Joint Venture, an arrangement structured as a strategic partnership
with the Group and other parties. The primary purpose of the joint arrangement is to facilitate exploration, mining and sale of
coal from the Dartbrook project. Under the joint arrangement agreement, all of the assets, rights, duties, obligations and
liabilities incurred by the arrangement are shared by the partners in proportion to their share. As such the arrangement is
classed as a joint operation, and accordingly, the Group’s interests in the assets, liabilities, revenues and expenses attributable
to the joint arrangement have been included in the appropriate line items in the consolidated financial statements.
The Group’s share of the assets employed in the Dartbrook Joint Arrangement that are included in the consolidated financial
statements are as follows (pre- consolidation adjustments):
2024
2023*
$
$
Current assets
Trade and other receivables
3,568,022
-
Cash at bank
16,318,451
-
Total current assets
19,886,473
-
Non-current assets
Property, plant and equipment
3,314,429
-
Mining properties
49,576,218
-
Right-of-use assets
2,880,682
-
Security deposits
7,898,760
-
Total non-current assets
63,670,089
-
Total assets
83,556,562
-
Current liabilities
Trade and other payables
15,949,254
-
Lease liabilities
514,231
Total current liabilities
16,463,485
-
Non-current liabilities
Provisions
16,872,800
-
Lease liabilities
2,395,278
Borrowings
79,620,585
Total non-current liabilities
98,888,663
-
Total liabilities
115,352,148
-
Net Interest in Dartbrook Joint Arrangement
(31,795,586)
-
*Joint operation assessment not concluded for the financial year ended 30 June 2023.
Australian Pacific Coal Limited
Notes to the financial statements
30 June 2024
47
Note 30. Events after the reporting period
No matter or circumstance has arisen since 30 June 2024 that has significantly affected, or may significantly affect the
Group's operations, the results of those operations, or the Group's state of affairs in future financial years.
Note 31. Reconciliation of profit after income tax to net cash from operating activities
Consolidated
2024
2023
$
$
(a) Reconciliation of cash flows from operating activities
Loss after income tax expense for the year
(12,630,899)
(12,517,633)
Adjustments for:
Depreciation and amortisation
1,186,086
1,029,053
Adjustments for changes in estimate
(9,963,306)
491,000
Accrued finance costs
3,955,470
5,705,126
Change in operating assets and liabilities:
(Increase) / decrease in trade and other receivables
(17,590,276)
77,629
(Increase) / decrease in prepayments and accruals
(1,801,174)
(274,271)
Increase / (decrease) in trade and other payables
8,833,746
(391,395)
Net cash from operating activities
(28,010,353)
(5,880,491)
(b) Reconciliation of net cash flows from financing activities
Contributions of equity, net of transaction costs
17,901,202
93,852,433
Repayment of borrowings/ payables
(1,875,000)
(70,500,000)
Proceeds from borrowings
64,648,238
-
Lease payments
(96,676)
-
Net cash from financing activities
80,577,764
23,352,433
Note 32. Earnings per share
Consolidated
2024
2023
$
$
Earnings per share for profit from continuing operations
Profit after income tax
(12,630,899)
(12,517,633)
Profit after income tax attributable to the owners of Australian Pacific Coal Limited
(12,630,899)
(12,517,633)
Cents
Cents
Basic earnings per share
(2.74)
(5.23)
Diluted earnings per share
(2.72)
(5.23)
Australian Pacific Coal Limited
Notes to the financial statements
30 June 2024
Note 32. Earnings per share (continued)
48
Number
Number
Weighted average number of ordinary shares
Weighted average number of ordinary shares used in calculating basic earnings per share
461,678,145
239,443,783
Adjustments for calculation of diluted earnings per share:
Options over ordinary shares
3,030,789
-
Convertible notes
-
-
Weighted average number of ordinary shares used in calculating diluted earnings per share
464,708,934
239,443,783
Note 33. Commitments
As at 30 June 2024, the Group had capital commitments contracted but not provided for of $15,010,027 through its working
interest in the Dartbrook Joint Venture. All capital commitments relate to development of the Dartbrook mine. As a party to the
joint operation, the Group also has certain obligations to expend minimum amount on current tenement and to keep tenements
in good standing. These obligations may vary from time to time and are expected to be fulfilled in the normal course of
operations of the joint operation. If the minimum expenditure requirements are not met, the joint operation has the option to
renegotiate new terms or relinquish the tenements.
Australian Pacific Coal Limited
Consolidated entity disclosure statement
30 June 2024
49
Basis of preparation
The consolidated entity disclosure statement has been prepared in accordance with subsection 295(3A)(a) of the Corporations
Act 2001 (Cth). The entities listed in the statements are Australian Pacific Coal Limited and all the entities it controls in
accordance with AASB 10 Consolidated Financial Statements.
The percentage of share capital disclosed for bodies corporate included in the statement represents the economic interest
consolidated in the consolidated financial statements.
The Group’s consolidated entity disclosure statement as at 30 June 2024 is set out below.
Ownership
interest
Entity Name
Entity Type
Place formed /
Country of
incorporation
%
Tax residency*
AQC Investments 1 Pty Ltd
Body corporate
Australia
100.00%
Australia
AQC Investments 2 Pty Ltd
Body corporate
Australia
100.00%
Australia
Area Coal Pty Ltd
Body corporate
Australia
100.00%
Australia
AQC Services Pty Ltd
Body corporate
Australia
100.00%
Australia
AQC Dartbrook Pty Ltd
Body corporate
Australia
100.00%
Australia
AQC Dartbrook Management Pty Ltd
Body corporate
Australia
100.00%
Australia
Dartbrook Coal (Sales) Pty Ltd
Body corporate
Australia
100.00%
Australia
Ipoh Pacific Resources Pty Ltd
Body corporate
Australia
100.00%
Australia
Felix St Pty Ltd
Body corporate
Australia
100.00%
Australia
IPR Operations Pty Ltd
Body corporate
Australia
100.00%
Australia
Mining Investments One Pty Ltd
Body corporate
Australia
100.00%
Australia
Australian Pacific Coal Limited (the parent entity) and its wholly owned Australian subsidiaries have formed an income tax
consolidated group under the tax consolidation regime.
Australian Pacific Coal Limited
Directors' declaration
30 June 2024
50
In the opinion of the Directors of Australian Pacific Coal Limited (the Company)
●
the attached financial statements and notes comply with the Corporations Act 2001, the Accounting Standards, the
Corporations Regulations 2001 and other mandatory professional reporting requirements;
●
the attached financial statements and notes comply with International Financial Reporting Standards as issued by the
International Accounting Standards Board as described in note 1 to the financial statements;
●
the attached financial statements and notes give a true and fair view of the Group's financial position as at 30 June
2024 and of its performance for the financial year ended on that date;
●
there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due
and payable; and
●
the information disclosed in the consolidated entity disclosure statement required by section 295(3A) of the
Corporations Act is true and correct.
The Directors have been given the declarations required by section 295A of the Corporations Act 2001.
Signed in accordance with a resolution of Directors made pursuant to section 295(5)(a) of the Corporations Act 2001.
On behalf of the Directors
___________________________
John Robinson
Chairman
30 September 2024
Brisbane
54
55
CORPORATE GOVERNANCE STATEMENT
Annual Report
Australian Pacific Coal Limited
Page 56
Year Ending 30 June 2024
ABN 49 089 206 986
Corporate Governance Statement
The Board of Directors of Australian Pacific Coal Limited (“the Company”) is responsible for establishing the
corporate governance framework of the Group having regard to the ASX Corporate Governance Council (“CGC”)
Principles and Recommendations and published guidelines. The Board guides and monitors the business and affairs
of the Company on behalf of the shareholders.
The Board seeks, where appropriate to adopt without modification, the CGC recommendations. Where there has
been any variation from the CGC recommendations, it is because the Board believes the Company is not as yet of
size, nor are its financial affairs of such complexity, to justify some of these recommendations. The Board is of the
view that with the exception of the departures to the CGC Corporate Governance Principles and Recommendations
as are set out below, it otherwise complied with all of the CGC Corporate Governance Principles and
Recommendations. The Company’s ASX Appendix 4G, which is a checklist cross-referencing the ASX Principles
and Recommendations to the relevant disclosures in either this statement or Annual Report, is available on our
website www.aqcltd.com.au. This statement has been approved by the Company’s Board of Director’s and is current
as at 30 September 2024.
The following table summarises the Company’s compliance with the CGC recommendations and states whether the
Company has complied with each recommendation.
Recommendation
Summary of the Company’s Compliance
Principle 1 – Lay solid foundations for management and oversight
Companies should clearly delineate the respective roles and responsibilities of its board and management
and regularly review their performance.
1.1: A listed entity should have a board charter
setting out:
a)
the respective roles and responsibilities
of its board and management; and
b)
those matters expressly reserved to the
board and those delegated to
management.
A formal board charter has not been established given
the size of the Company’s Board and management.
The Board is ultimately accountable for the
performance of the Company and provides leadership
and sets the strategic objectives of the Company. It
appoints all senior executives and assesses their
performance on an annual basis. It is responsible for
overseeing
all
corporate
reporting
systems,
remuneration frameworks, governance issues, and
stakeholder communications. Decisions reserved for
the Board relate to those that have a fundamental
impact on the Company, such as material acquisitions
and takeovers, dividends and buybacks, material
profits upgrades and downgrades, and significant
closures.
Management is responsible for implementing Board
strategy,
day-to-day
operational
aspects,
and
ensuring that all risks and performance issues are
brought to the Board’s attention. They must operate
within the risk and authorisation parameters set by the
Board.
CORPORATE GOVERNANCE STATEMENT
Annual Report
Australian Pacific Coal Limited
Page 57
Year Ending 30 June 2024
ABN 49 089 206 986
Corporate Governance Statement
1.2: A listed entity should:
a) undertake appropriate checks before
appointing a person, or putting forward
to security holders a candidate for
election, as a director; and
b) provide security holders with all material
information in its possession relevant to
a decision on whether or not to elect or
re-elect a director.
The Company undertakes relevant reference checks
prior to appointing a director, or putting that person
forward as a candidate to ensure that person is
competent, experienced, and would not be impaired
in any way from undertaking the duties of director.
The Company provides relevant information to
shareholders for their consideration about the
attributes of candidates together with whether the
Board supports the appointment or re-election of a
director.
1.3: A listed entity should have a written agreement
with each director and senior executive setting out
the terms of their appointment.
The terms of the appointment of a non-executive
director, executive directors and senior executives
are agreed upon and set out in writing at the time of
appointment.
1.4: The Company secretary of a listed entity should
be accountable directly to the board, through the
chair, on all matters to do with the proper functioning
of the board.
The Company Secretary reports directly to the Board
through the Chairman and is accessible to all
directors.
1.5: A listed entity should:
have and disclose a diversity policy;
through its board or a committee of the board
set measurable objectives for achieving
gender diversity in the composition of its
board, senior executives and workforce
generally; and
disclose in relation to each reporting period:
the measurable objectives set for that period
to achieve gender diversity;
the entity’s progress towards achieving
those objectives; and
either:
the respective proportions of men and
women on the Board, in senior
executive positions and across the
whole organisation (including how
the entity has defined “senior
executive” for these purposes); or
if the entity is a “relevant employer”
under the Workplace Gender
Equality Act, the entity’s most recent
“Gender Equality Indicators”, as
defined in and published under that
Act
The Company has not adopted a formal Diversity
Policy nor has it set measurable objectives for
achieving gender diversity as it has a small number of
directors and employees and has limited opportunity
and scope to adopt formalised policy guidelines or
measurable objectives.
The Board is committed to developing diversity in its
workplace to assist the Company to meet its goals
and objectives by providing an environment whereby
appointments, advancement and opportunities are
considered on a fair and equitable basis. The
Company is committed to promoting a corporate
culture which embraces diversity when determining
the composition of the Board, senior management
and employees.
The Company will ensure that recruitment and
selection decisions are based on the principle of
merit, skills and qualifications and regardless of age,
gender, nationality, cultural background or any other
factor not relevant to the position. Past skills and
experience in the mining and exploration industries
will be a key determinant in the selection process.
At reporting date, the Company had four directors and
one company secretary, one of which was female.
No entity within the consolidated entity is a ‘relevant
employer’ for the purposes of the Workplace Gender
Equality Act 2012 (Cth) and therefore no Gender
Equality Indicators to be disclosed.
CORPORATE GOVERNANCE STATEMENT
Annual Report
Australian Pacific Coal Limited
Page 58
Year Ending 30 June 2024
ABN 49 089 206 986
Corporate Governance Statement
1.6: A listed entity should:
a) have and disclose a process for
periodically evaluating the performance
of the Board, its committees and
individual directors; and
b) disclose, in relation to each reporting
period, whether a performance
evaluation was undertaken in the
reporting period in accordance with that
process.
Due to its size the Company does not currently have
a formal process for evaluating the performance of the
Board, its committees or individual directors. The
Board conducts its own evaluation of the skills,
performance and remuneration of existing Directors
from
time
to time.
Individual Directors
may
recommend changes to the composition of the Board.
Until such time as the Company expands to justify an
expansion of Board members, the Board is of the
current opinion that such performance evaluation is
suitable for the Company.
1.7: A listed entity should:
a) have and disclose a process for
evaluating the performance of its senior
executives at least once every reporting
period; and
b) disclose, in relation to each reporting
period, whether a performance
evaluation was undertaken in the
reporting period in accordance with that
process.
The Board reviews the performance of senior
executives periodically.
No performance evaluation of the executives was
undertaken during the reporting period given the
status of the company, its business operations and
the composition of its executive.
Principle 2 – Structure the board to be effective and add value
A listed entity should be of an appropriate size and collectively have the skills, commitment and knowledge
of the entity and the industry in which it operates, to enable it to discharge its duties effectively and to add
value.
2.1: The board of a listed entity should:
a) have a nomination committee which:
i.
has at least three members, a
majority of whom are
independent directors; and
ii.
is chaired by an independent
director,
b) and disclose:
i.
the charter of the committee;
ii.
the members of the committee;
and
iii.
as at the end of each reporting
period, the number of times the
committee met throughout the
period and the individual
attendances of the members at
those meetings; or
c) if it does not have a nomination
committee, disclose that fact and the
processes it employs to address board
succession issues and to ensure that
The Company does not have a separate nomination
committee. Given the size of the Board, the Board as
a whole decides the selection of members of the
Board and makes recommendations to shareholders
for election of Directors. Each Board member is
responsible
for
assessing
the
necessary
competencies of the Board members to add value to
the Company, reviewing Board succession plans and
evaluating the Board’s performance.
CORPORATE GOVERNANCE STATEMENT
Annual Report
Australian Pacific Coal Limited
Page 59
Year Ending 30 June 2024
ABN 49 089 206 986
Corporate Governance Statement
the board has the appropriate balance of
skills, knowledge, experience,
independence and diversity to enable it
to discharge its duties and
responsibilities effectively.
2.2: A listed entity should have and disclose a board
skills matrix setting out the mix of skills and diversity
that the board currently has or is looking to achieve
in its membership.
The current Board members represent individuals
that
have
extensive
experience
as
well
as
professionals that bring to the Board their specific
skills in order for the Company to achieve its strategic,
operational
and
compliance
objectives.
Their
suitability to the directorship has therefore been
determined primarily on the basis of their ability to
deliver outcomes in accordance with the Company’s
short and long term objectives and therefore deliver
value to shareholders.
All Board members are expected to demonstrate the
following attributes:
Board Member Attributes
Leadership
Represents the Company
positively amongst
stakeholders and external
parties; decisively acts
ensuring that all pertinent
facts are considered; leads
others to action; proactive
solution seeker.
Ethics and
integrity
Awareness of social,
professional and legal
responsibilities at individual,
Company and community
level; ability to identify
independence conflicts;
applies sound professional
judgement; identifies when
external counsel should be
sought; upholds Board
confidentiality; respectful in
every situation.
Communication
Effective in working within
defined corporate
communications policies;
makes constructive and
precise contribution to the
Board both verbally and in
written form; an effective
communicator with
executives.
CORPORATE GOVERNANCE STATEMENT
Annual Report
Australian Pacific Coal Limited
Page 60
Year Ending 30 June 2024
ABN 49 089 206 986
Corporate Governance Statement
Corporate
governance
Experienced director that is
familiar with the
mechanisms, controls and
channels to deliver effective
governance and manage
risks.
2.3: A listed entity should disclose:
a) the names of the directors considered
by the board to be independent
directors;
b) if a director has an interest, position,
association or relationship of the type
described in Box 2.3 but the board is of
the opinion that it does not compromise
the independence of the director, the
nature of the interest, position,
association or relationship in question
and an explanation of why the board is
of that opinion; and
c) the length of service of each director.
Details of the Board of directors, their appointment
dated, length of service and independence status is
set out from page 3 of the Annual Report.
2.4: A majority of the board of a listed entity should
be independent directors.
The board consists of four directors, two of whom are
considered independent.
Given the size and status of the Company and its
operational status, the Board considered this to be
appropriate.
2.5: The chair of the board of a listed entity should
be an independent director and, in particular, should
not be the same person as the CEO of the entity.
The current Chair, Mr John Robinson, is not
considered an independent director. Mr Robinson
does not perform the role of CEO. Mr John Robinson
has been nominated to the Board by the majority
shareholder of the Company.
2.6: A listed entity should have a program for
inducting new directors and for periodically reviewing
whether there is a need for existing directors to
undertake professional development to maintain the
skills and knowledge needed to perform their role as
directors effectively.
New directors undertake an induction program
coordinated by the Company Secretary that briefs
and informs the director on all relevant aspects of the
Company’s operations and background. Directors are
encouraged to undertake director development
programs to ensure that directors can enhance their
skills and remain abreast of important developments,
however no formal program of review has been
implemented given the status of the Company and its
operational status.
Principle 3 – Instil a culture of acting lawfully, ethically and responsibly
A listed entity should instil and continually reinforce a culture across the organisation of acting lawfully,
ethically and responsibly.
CORPORATE GOVERNANCE STATEMENT
Annual Report
Australian Pacific Coal Limited
Page 61
Year Ending 30 June 2024
ABN 49 089 206 986
Corporate Governance Statement
3.1: A listed entity should articulate and disclose its
values.
A formal value statement has not been established or
disclosed given the size of the Company’s Board and
management.
The Company is committed to conducting all of its
business activities fairly, honestly with a high level of
integrity, and in compliance with all applicable laws,
rules and regulations. The Board and management
are dedicated to high ethical standards and recognise
and
support
the
Company’s
commitment
to
compliance with these standards.
3.2: A listed entity should:
a) have and disclose a code of conduct for
its directors, senior executives and
employees; and
b) ensure that the board or a committee of
the board is informed of any material
breaches of that code.
A formal code of conduct has not been established
given the size of the Company’s Board and
management.
3.3: A listed entity should:
a) have and disclose a whistleblower
policy; and
b) b) ensure that the board or a
committee of the board is informed of
any material incidents reported under
that policy.
The Company’s Whistleblower Policy is available on
the Company’s website. Any material breaches of the
Whistleblower Protection Policy are to be reported in
accordance with this policy.
3.4: A listed entity should:
a) have and disclose an anti-bribery and
corruption policy; and
b) ensure that the board or a committee of
the board is informed of any material
breaches of that code.
A formal anti-bribery and corruption policy has not
been established given the size of the Company’s
Board and management.
Principle 4 – Safeguard the integrity of corporate reports
A listed entity should have formal and rigorous processes that independently verify and safeguard the
integrity of its corporate reporting.
4.1 - The board of a listed entity should:
a) have an audit committee which:
i.
has at least three members, all
of whom are non-executive
directors and a majority of whom
are independent directors; and
ii.
is chaired by an independent
director, who is not the chair of
the board, and disclose:
iii.
the charter of the committee;
iv.
the relevant qualifications and
experience of the members of
the committee; and
Given the current membership of the Board and the
size, organisational complexity and scope
of
operations, the same efficiencies of an audit
committee would not be derived from a formal
committee structure.
The Board has developed an informal audit
committee, comprising Ayten Saridas and John
Robinson, which overseas matters as delegated to it
by the Board on an as needed basis.
CORPORATE GOVERNANCE STATEMENT
Annual Report
Australian Pacific Coal Limited
Page 62
Year Ending 30 June 2024
ABN 49 089 206 986
Corporate Governance Statement
v.
in relation to each reporting
period, the number of times the
committee met throughout the
period and the individual
attendances of the members at
those meetings; or
b) if it does not have an audit committee,
disclose that fact and the processes it
employs that independently verify and
safeguard the integrity of its corporate
reporting, including the processes for
the appointment and removal of the
external auditor and the rotation of the
audit engagement partner.
Responsibility for establishing and maintaining a
framework of internal control and setting appropriate
standards for the management of the Company rests
with the Board. The Board is also responsible for the
integrity of financial information in the financial
statements; audit, accounting and financial reporting
obligations; safeguarding the independence of the
external auditor; and financial risk management.
4.2: The board of a listed entity should, before it
approves the entity’s financial statements for a
financial period, receive from its CEO and CFO a
declaration that, in their opinion, the financial records
of the entity have been properly maintained and that
the financial statements comply with the appropriate
accounting standards and give a true and fair view of
the financial position and performance of the entity
and that the opinion has been formed on the basis of
a sound system of risk management and internal
control which is operating effectively.
For the financial year ended 30 June 2024 the
Company’s CEO and CFO provided the Board with
the required declarations.
4.3: A listed entity should disclose its process to verify
the integrity of any periodic corporate report it
releases to the market that is not audited or reviewed
by an external auditor.
Given the current size of the Board and management,
the Company ensures that the corporate reports it
releases are reviewed by the Board to ensure the
financial and technical content is accurate, balanced
and understandable.
Principle 5 – Make timely and balanced disclosure
A listed entity should make timely and balanced disclosure of all matters concerning it that a reasonable
person would expect to have a material effect on the price or value of its securities.
5.1: A listed entity should have and disclose a
written policy for complying with its continuous
disclosure obligations under listing rule 3.1.
The Company is committed to promoting investor
confidence and ensuring that shareholders and the
market are provided with timely and balanced
disclosure of all material matters concerning the
Company, as well as ensuring that all shareholders
have equal and timely access to externally available
information issued by the Company, and takes its
continuous disclosure obligations seriously.
Primary responsibility rests with the Chief Executive
Officer, while the Company Secretary is primarily
responsible for communications with the Exchange.
CORPORATE GOVERNANCE STATEMENT
Annual Report
Australian Pacific Coal Limited
Page 63
Year Ending 30 June 2024
ABN 49 089 206 986
Corporate Governance Statement
Whilst the Company does not have a formal policy,
the
Company
notifies
the
ASX
promptly
of
information:
• concerning the Company, that a reasonable person
would expect to have a material effect on the price or
value of the Company’s securities; and
• that would, or would be likely to, influence persons
who commonly invest in securities in deciding
whether to acquire or dispose of the Company’s
securities.
Announcements are made in a timely manner, are
factual and do not omit material information in order
to avoid the emergence of a false market in the
Company’s securities.
Given the size of the Consolidated Entity, a formal
continuous disclosure policy has not been adopted.
5.2: A listed entity should ensure that its board
receives copies of all material market
announcements promptly after they have been
made.
Given the current size of the Board and management,
the Company aims to ensure that all market
announcements are received prior to release to the
market, but if not they are promptly distributed at the
time of market announcement.
5.3: A listed entity that gives a new and substantive
investor or analyst presentation should release a
copy of the presentation materials on the ASX
Market Announcements Platform ahead of the
presentation.
The Company’s ensures that any presentations to
investors or analysts are released to the ASX Markets
Platform ahead of presentation.
Principle 6 – Respect the rights of security holders
A listed entity should respect the rights of its security holders by providing them with appropriate information
and facilities to allow them to exercise those rights effectively.
6.1: A listed entity should provide information about
itself and its governance to investors via its website.
The Company maintains information in relation to
governance
documents,
directors
and
senior
executives, annual report, ASX announcements and
contact details on the Company’s website.
The Company is committed to:
•
Communicating effectively with its shareholders
and ensuring that it is easy for shareholders to
communicate with the Company;
•
Complying
with
its
continuous
disclosure
obligations applicable to the ASX listing rules and
other regulations; and
•
Ensuring that the shareholders and other
stakeholders are provided with timely and full
information about the Company’s activities.
CORPORATE GOVERNANCE STATEMENT
Annual Report
Australian Pacific Coal Limited
Page 64
Year Ending 30 June 2024
ABN 49 089 206 986
Corporate Governance Statement
6.2: A listed entity should have an investor relations
program that facilitate effective two-way
communication with investors.
The Company does not have a formal investor
relations program. The Board
and
Company
Secretary engage with investors at the AGM, in
relation to material announcements, and respond to
shareholder enquiries on an ad hoc basis. Material
communications are dispatched to investors either via
email, surface mail, and/or via market announcement.
6.3: A listed entity should disclose how it facilitates
and encourages participation at meetings of security
holders
To facilitate and to encourage participation at
meetings of shareholders, the Company ensures that
information is communicated to its shareholders
through:
•
Posting information on the Company’s web site at
www.aqcltd.com;
•
The distribution of Notice of Meetings and other
information directly to shareholders through
letters, email and other forms of communications;
•
Ensuring that auditors are invited to the Annual
General Meeting to consider questions regarding
the conduct of the audit and the preparation and
content of the auditor report; and
•
Allowing
shareholders
the
opportunity
at
meetings to discuss resolutions.
6.4: A listed entity should ensure that all substantive
resolutions at a meeting of security holders are
decided by a poll rather than by a show of hands.
The Company will ensure that all substantive
resolutions at shareholders meetings are decided by
poll rather than a show of hands.
6.5: A listed entity should give security holders the
option to receive communications from, and send
communications to, the entity and its security registry
electronically.
The Company engages its share registry to manage
the majority of communications with shareholders.
Shareholders
are
encouraged
to
receive
correspondence from the Company electronically,
thereby facilitating a more effective, efficient and
environmentally friendly communication mechanism
with
shareholders.
Shareholders
not
already
receiving information electronically can elect to do so
through the share registry, Link Market Services
Limited at:
https://www.linkmarketservices.com.au/corporate/Inv
estorServices/Investor-Services.html.
Principle 7 – Recognise and manage risk
A listed entity should establish a sound risk management framework and periodically review the
effectiveness of that framework.
CORPORATE GOVERNANCE STATEMENT
Annual Report
Australian Pacific Coal Limited
Page 65
Year Ending 30 June 2024
ABN 49 089 206 986
Corporate Governance Statement
7.1: The board of a listed entity should:
a) have a committee or committees to
oversee risk, each of which:
i.
has at least three members, a
majority of whom are
independent directors; and
ii.
is chaired by an independent
director, and disclose:
iii.
the charter of the committee;
iv.
the members of the committee;
and
v.
as at the end of each reporting
period, the number of times the
committee met throughout the
period and the individual
attendances of the members at
those meetings; or
b) if it does not have a risk committee or
committees that satisfy a) above,
disclose that fact and the processes it
employs for overseeing the entity’s risk
management framework
The Company has not established a separate Risk
Committee as it is considered that the current size of
the Board does not warrant the formal establishment
of a separate committee. The Board as a whole
therefore performs the function of such a committee
which includes the setting of corporate governance
policy and exercising due care and skill in assessing
risk, developing strategies to mitigate such risk,
monitoring the risk and the Company’s effectiveness
in managing it. The Company maintains internal
controls which assist in managing enterprise risk, and
these are reviewed as part of the scope of the external
audit, with the auditor providing the Board with
commentary on their effectiveness and the need for
any additional controls. The CEO is responsible for
monitoring operational risk, ensuring all relevant
insurances are in place, and ensuring that all
regulatory and compliance obligations of the
Company are satisfied.
7.2: The board or a committee of the board should:
a) review the entity’s risk management
framework at least annually to satisfy
itself that it continues to be sound; and
b) disclose, in relation to each reporting
period, whether such a review has taken
place
The
Board
is responsible for
reviewing
the
Company’s policy on risk management and risk
oversight. The Board did not conduct a formal review
of the Company’s risk management framework during
the reporting period due to the nature of the
operations during the year.
7.3: A listed entity should disclose:
a) if it has an internal audit function, how
the function is structured and what role it
performs; or
b) if it does not have an internal audit
function, that fact and the processes it
employs for evaluating and continually
improving the effectiveness of its risk
management and internal control
processes.
The Company does not have a dedicated internal
audit function. The responsibility for risk management
and internal controls lies with both the CEO and CFO
who continually monitor the Company’s internal and
external risk environment. Necessary action is taken
to protect the integrity of the Company’s books and
records
including
by
way
of
design
and
implementation of internal controls, and to ensure
operational efficiencies, mitigation of risks, and
safeguard of Company assets.
7.4: A listed entity should disclose whether it has any
material exposure to economic, environmental and
social sustainability risks and, if it does, how it
manages or intends to manage those risks.
Refer to the Company’s Annual Report for disclosures
relating to the Company’s material business risks
(including any material exposure to economic,
environmental or social sustainability risks). Refer to
commentary at Recommendations 7.1 and 7.2 for
information on the Company’s risk management
framework.
CORPORATE GOVERNANCE STATEMENT
Annual Report
Australian Pacific Coal Limited
Page 66
Year Ending 30 June 2024
ABN 49 089 206 986
Corporate Governance Statement
Principle 8 – Remunerate fairly and responsibly
A listed entity should pay director remuneration sufficient to attract and retain high quality directors and
design its executive remuneration to attract, retain and motivate high quality senior executives and to align
their interest with the creation of value for security holders.
8.1: The board of a listed entity should:
a) have a remuneration committee which:
i.
has at least three members, a
majority of whom are
independent directors; and
ii.
is chaired by an independent
director, and disclose:
iii.
the charter of the committee;
iv.
the members of the committee;
and
v.
as at the end of each reporting
period, the number of times the
committee met throughout the
period and the individual
attendances of the members at
those meetings; or
b) if it does not have a remuneration
committee, disclose that fact and the
processes it employs for setting the level
and composition of remuneration for
directors and senior executives and
ensuring that such remuneration is
appropriate and not excessive.
The Company has not established a formal
Remuneration Committee as it is considered that the
current size of the Board does not warrant the formal
establishment of a separate committee.
The Board has developed an informal remuneration
committee, comprising Nick Johansen and Jeffrey
Gerard. These directors overseas matters as
delegated to them by the Board on an as needed
basis. These matters include guidance to the Board
as a whole in performing the function of such a
committee which includes setting the Company’s
remuneration structure, determining eligibilities in
relation to incentive schemes, assessing performance
and remuneration of senior management and
determining the remuneration and incentives of the
Board and executives. The Board may obtain external
advice from independent consultants in determining
the Company’s remuneration practices, including
remuneration levels, where considered appropriate.
8.2: A listed entity should separately disclose its
policies and practices regarding the remuneration of
non-executive directors and the remuneration of
executive directors and other senior executives.
Non-executive directors’ remuneration is fee based
with the level of remuneration reflective of the
anticipated time commitments and responsibilities of
the position.
The Board considers the procedures, policies and key
performance indicators
used to measure the
performance of key executives and directors. Any
equity based executive remuneration may be made in
accordance
with
thresholds
approved
by
shareholders and developed over time.
Full discussion of the Company’s remuneration
philosophy
and
framework
and
remuneration
received by directors and executives in the current
financial year is contained in the Remuneration
Report section of the Directors’ Report.
CORPORATE GOVERNANCE STATEMENT
Annual Report
Australian Pacific Coal Limited
Page 67
Year Ending 30 June 2024
ABN 49 089 206 986
Corporate Governance Statement
8.3: A listed entity which has an equity-based
remuneration scheme should:
a) have a policy on whether participants
are permitted to enter into transactions
(whether through the use of derivatives
or otherwise) which limit the economic
risk of participating in the scheme; and
b) disclose that policy or a summary of it
Where a director or other senior executive uses
derivatives or other hedging arrangements over
vested securities of the Company, this will be
disclosed. There was no equity based renumeration
during the reporting period.
ASX ADDITIONAL INFORMATION
Australian Pacific Coal Limited
Shareholder information
Annual Report
Australian Pacific Coal Limited
Page 68
Year Ending 30 June 2024
ABN 49 089 206 986
ASX additional information
Additional information required by the Australian Stock Exchange Limited and not shown elsewhere in this report is
as follows. This information is current as 25 September 2024.
1.
Shareholding
a.
Distribution of Shareholders – Ordinary Securities
Number
Number
Category (size of holding)
of holders
of shares held
1 – 1,000
251
106,088
1,001 – 5,000
446
1,307,695
5,001 – 10,000
272
2,084,039
10,001 – 50,000
446
10,643,851
50,001 – 100,000
125
9,675,978
100,001 – and over
238
509,983,273
Total
1,778
533,800,924
b.
The number of shareholdings held in less than a marketable parcel of 500 shares (closing price on 25
September 2024) is 476 and they hold 524,315 shares.
c.
The names of the substantial holders in the company as at 25 September 2024 are:
Number
Substantial Holder
of shares
Trepang Services Pty Ltd
176,190,717
Regal Funds Management Pty Ltd and its associates
59,996,906
Sambor Trading Pty Ltd
54,509,518
d.
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 present
at a meeting or by proxy has one vote on a show of hands.
Unlisted options:
—
Options do not entitle the holders to vote in respect of the option, nor participate in dividends,
when declared, until such time as the options are exercised and subsequently registered as
ordinary shares.
ASX ADDITIONAL INFORMATION
Australian Pacific Coal Limited
Shareholder information
Annual Report
Australian Pacific Coal Limited
Page 69
Year Ending 30 June 2024
ABN 49 089 206 986
ASX additional information
e.
20 Largest Shareholders — Ordinary Shares
Name
Number of Ordinary
Fully Paid Shares
Held
% Held of
Issued
Ordinary
Capital
1.
TREPANG SERVICES PTY LTD
176,190,717
33.01
2.
SAMBOR TRADING PTY LTD
54,509,518
10.21
3.
CITICORP NOMINEES PTY LIMITED
26,926,638
5.04
4.
MR BUGUO WANG
20,044,138
3.75
5.
LATIMORE FAMILY PTY LTD
16,226,172
3.04
6.
UBS NOMINEES PTY LTD
15,086,739
2.83
7.
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
15,060,526
2.82
8.
BART SUPERANNUATION PTY LIMITED
9,557,763
1.79
9.
WARBONT NOMINEES PTY LTD
8,865,510
1.66
10. MR NICHOLAS THEODORE JAMES PASPALEY
8,822,085
1.65
11. BNP PARIBAS NOMINEES PTY LTD
8,326,493
1.56
12. BUTTONWOOD NOMINEES PTY LTD
7,195,469
1.35
13. NT HOUSE PTY LTD
6,944,444
1.30
14. NEWECONOMY COM AU NOMINEES PTY LIMITED
6,676,206
1.25
15. JET ARM LIMITED
5,000,000
0.94
16. NORFOLK ENCHANTS PTY LTD
4,462,197
0.84
17. SAMBOR TRADING PTY LTD
3,700,850
0.69
18. EST JOHN LAWRENCE MCINTYRE
3,500,000
0.66
19. MR MALCOLM JOHN MCCLURE
3,464,753
0.65
20. FAMA INVESTMENTS PTY LTD
3,454,545
0.65
404,014,763
75.69
f.
Unlisted options
Nil
2.
Stock Exchange Listing
Quotation has been granted for all the ordinary shares of the company on all Member Exchanges of the Australian Stock
Exchange Limited (ASX Code: AQC).
Competent Persons Statement
All exploration results, mineral resources and reserves referred to in this Annual Report have previously been announced to the market
by the Company in accordance with the requirements of Chapter 5 of the ASX Listing Rules and the JORC Code, including as to the
requirements for a statement from a Competent Person; and the relevant announcements have been referred to in the body of the Annual
Report. The Company confirms that it is not aware of any new information or data that materially affects that information.
CORPORATE DIRECTORY
Annual Report
Australian Pacific Coal Limited
Page 70
Year Ending 30 June 2024
ABN 49 089 206 986
Corporate Directory
DIRECTORS
Mr John Robinson, Chairman
Ms Ayten Saridas, Managing Director and Chief Executive Officer
Mr Nick Johansen, Non-Executive Director
Mr Jeff Gerard, Non-Executive Director
COMPANY SECRETARY
Mr Craig McPherson
AUDITORS
Hall Chadwick, Chartered Accountants
Level 14, 41 Collins Street
Melbourne VIC 3004
SHARE REGISTRY
Link Market Services Limited
Level 21, 10 Eagle Street
Brisbane QLD 4000
Phone: 1300 554 474
www.linkmarketservices.com.au
REGISTERED OFFICE
Australian Pacific Coal Limited
Level 1/371 Queen Street
Brisbane QLD 4000
Phone: +61 7 3221 0679
Fax: +61 7 3229 9323
www.aqcltd.com