ANNUAL REPORT
2022
2
TABLE OF CONTENTS
TABLE OF CONTENTS ..................................................................................................................................... 2
CORPORATE INFORMATION ......................................................................................................................... 3
DIRECTORS’ REPORT ..................................................................................................................................... 4
AUDITORS INDEPENDENCE LETTER............................................................................................................. 32
QUALIFYING STATEMENTS .......................................................................................................................... 33
CONSOLIDATED STATEMENT OF PROFIT AND LOSS AND OTHER COMPREHENSIVE INCOME ................... 34
CONSOLIDATED STATEMENT OF FINANCIAL POSITION .......................................................................... 35
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY ............................................................................ 36
CONSOLIDATED STATEMENT OF CASH FLOWS ........................................................................................ 37
DIRECTORS’ DECLARATION ......................................................................................................................... 72
INDEPENDENT AUDITORS REPORT ............................................................................................................. 73
ASX ADDITIONAL INFORMATION ................................................................................................................ 78
3
CORPORATE INFORMATION
ABN 48 116 296 541
DIRECTORS
Brett Clark
(Executive Chairman & CEO)
Kevin Dundo
(Non-executive Director)
Winnie Lai Hadad
(Non-executive Director)
Roger Harris
(Non-executive Director)
Dr Geoffrey Xue
(Non-executive Director)
COMPANY SECRETARY
Graeme Smith
REGISTERED OFFICE
Suite 6, 100 Mill Point Road
South Perth WA 6151
PRINCIPAL PLACE OF BUSINESS
Suite 6, 100 Mill Point Road
South Perth WA 6151
SOLICITORS
Thomson Geer Lawyers
Level 27, Exchange Tower,
2 The Esplanade, Perth WA 6000
BANKERS
National Australia Bank Limited
Level 14, 100 St George’s Terrace
Perth, WA 6000
SHARE REGISTER
Computershare Investor Services Pty Limited
Level 11, 172 St Georges Terrace
Perth, WA 6000
Telephone: 1300 787 272
AUDITORS
Hall Chadwick WA Audit Pty Ltd
283 Rokeby Road
Subiaco WA 6008
INTERNET ADDRESS
www.avenira.com
EMAIL ADDRESS
frontdesk@avenira.com
STOCK EXCHANGE LISTING
Avenira Limited shares are listed on the:
Australian Securities Exchange (Code: AEV)
DIRECTORS’ REPORT
4
DIRECTORS’ REPORT
Your directors submit their report on the consolidated entity (referred to hereafter as the Group) consisting of Avenira
Limited (Company) and the entities it controlled at the end of, or during, the year ended 30 June 2022.
DIRECTORS
The names and details of the Company’s directors in office during the financial year and until the date of signing this
report are as follows. Where applicable, all current and former directorships held in listed public companies over the last
three years have been detailed below. Directors were in office for this entire period unless otherwise stated.
NAMES, QUALIFICATIONS, EXPERIENCE AND SPECIAL RESPONSIBILITIES
Brett Clark, B. Eng., Dip. Fin. (Executive Chairman and CEO)
Mr. Clark is a senior executive with 30 years’ experience in the mining and energy sectors in funding, operations and
advisory, notably with Hamersley Iron Pty Ltd, CRA Limited, WMC Resources Limited, Iron Ore Company of Canada, Rio
Tinto Limited and subsequently with Ernst and Young, Tethyan Copper Company Pty Ltd, Oakajee Port and Rail, Mitsubishi
Development and Murchison Metals. Mr. Clark has extensive leadership experience in board positions held at both listed
and unlisted companies. His expertise ranges from project development to operations, sales and marketing in gold, iron
ore, copper, nickel, coal, industrial minerals, and upstream oil and gas across Australia, Africa, Asia, Latin America and
North America. His funding experience includes bond raisings, debt restructuring, equity, and mezzanine financing in the
US and Asian capital markets.
Shares Held –
Nil
Options Held –
12,000,000 options ex @ $0.02 expiring 30/11/22
12,000,000 options ex @ $0.03 expiring 30/11/22
Other Current Listed Company Directorships
Nil
Former Listed Company Directorships in the last 3 years
Nil
Winnie Lai Hadad, B. Com, MSc, BA, CPA, AusIMM (Non-executive Director)
Ms Lai Hadad has expertise in change management, corporate governance and business process improvement and has
been involved in listings on the Australian Securities Exchange. Ms Lai Hadad has been involved with both investments
into China and out-bound investment from China. Her past roles include implementing Coca-Cola bottling strategies into
Greater China and administering the first Chinese direct investment in an iron ore mine in the Pilbara Region of Western
Australia. Ms Lai Hadad is a lawyer admitted to practice in Western Australia, a qualified CPA, holds a BA, BCom and
MSc, and is a graduate of both the Australian Institute of Company Directors and Governance Institute of Australia.
Shares Held –
Nil
Options Held –
6,000,000 options ex @ $0.02 expiring 30/11/22
6,000,000 options ex @ $0.03 expiring 30/11/22
Other Current Listed Company Directorships
Non-Executive Director of Vonex Limited
Former Listed Company Directorships in the last 3 years
Nil
Special Responsibilities
Chair of the Audit Committee; Member of the Remuneration and Nomination Committee
DIRECTORS’ REPORT
5
Kevin Dundo, LLB, B. Com, FCPA (Non-executive Director)
Mr Kevin Dundo is a practicing lawyer, specialising in commercial and corporate law and in particular, mergers and
acquisitions, with experience in the mining services and financial services industries. He is a member of the Law Society
of Western Australia, Law Council of Western Australia, Australian Institute of Company Directors and a Fellow of the
Australian Society of Certified Practicing Accountants.
Shares Held –
7,031,250
Options Held –
6,000,000 options ex @ $0.02 expiring 30/11/22
6,000,000 options ex @ $0.03 expiring 30/11/22
260,416 options ex @ $0.022 expiring 30/04/24
Other Current Listed Company Directorships
Non-executive Chairman of Red 5 Limited
Former Listed Company Directorships in the last 3 years
Non-executive Director of Cash Converters International Limited
Non-executive Director of Imdex Limited
Special Responsibilities
Chair of the Remuneration and Nomination Committee; Member of the Audit Committee
Roger Harris, B(App)Sc (Non-executive Director) (appointed 8 July 2021)
Mr Harris has a B App Science and was the founding director / owner of a large service based company with branches in
Western Australia and SE Asia and managed the exit sale that was ultimately acquired by a multi national top 25 ASX
listed company. Mr Harris has continued to operate a family office for 30 years investing in the natural resources sector
and other asset classes and continues in the development and growth of business’ through mergers and acquisitions.
Shares Held –
12,734,794
Options Held –
434,621 options ex @ $0.022 expiring 30/04/24
Other Current Listed Company Directorships
Nil
Former Listed Company Directorships in the last 3 years
Nil
Special Responsibilities
Member of the Audit Committee
Dr Geoffrey Xunxing Xue, BSc, MSc, PhD, AusIMM (Non-executive Director) (appointed 23 July 2021)
Dr Xue has both a PhD in Economic Geology and a Masters in Economic Geology as well as a Bachelor (Honours) in
Geology. Dr Xue has more than 10 years’ experience in mining and investment banking in Australia and has had significant
experience in gold project development from exploration through resource definition and feasibility study to commercial
production. Dr Xue is currently the Project Manager at Anova Metals Ltd (AWV) and previously a senior executive in KPMG
Corporate Finance.
Shares Held –
Nil
Options Held –
Nil
Other Current Listed Company Directorships
Nil
Former Listed Company Directorships in the last 3 years
Nil
Special Responsibilities
Member of the Remuneration and Nomination Committee
COMPANY SECRETARY
Graeme Smith, B.Ec, MBA, MComLaw, FCPA, FCG (CS, CGP), FGIA
Mr. Smith is the principal of Wembley Corporate Services which provide corporate secretarial, chief financial officer and
corporate governance services. Mr. Smith has over 30 years’ experience in company secretarial work.
DIRECTORS’ REPORT
6
PRINCIPAL ACTIVITIES
The principal activities of the Company during the course of the financial year, was the development of the Jundee South
project in Western Australia and the Wonarah Phosphate Project in the Northern Territory. The Group’s operations are
discussed in the Review of Operations section of this report.
CONSOLIDATED RESULTS
YEAR END
30 JUNE 2022
YEAR END
30 JUNE 2021
$
$
Consolidated loss before income tax expense from continuing operations
(2,875,209)
(2,105,959)
Income tax benefit
-
-
LOSS FOR THE YEAR
(2,875,209)
(2,105,995)
DIVIDENDS
No dividends were paid or declared during the financial year. No recommendation for payment of dividends has been made.
REVIEW OF OPERATIONS
A review of the operations of the Group during the financial year and likely developments and expected results is included
in the Operating and Financial Review set out below.
DIRECTORS’ REPORT
7
WONARAH PHOSPHATE PROJECT, NORTHERN TERRITORY (100% OWNED)
SUMMARY
The Wonarah Project is one of Australia’s largest undeveloped phosphate projects. Located between Tennant Creek and Mount Isa, the
project area is adjacent to the national highway and a high-quality water source. The nearby rail infrastructure at Tennant Creek offers
significant capacity upgrade capability and the Northern Gas Pipeline runs through the Project area.
Figure 1 Location map of Wonarah Phosphate Project
▪
Considered to be one of Australia’s largest phosphate projects:
▪
Measured Resource of 64.9 Mt @ 22.4% P2O5
▪
Indicated Resource of 133 Mt @ 21.1% P2O5
▪
Inferred Resource of 352 Mt @ 21% P2O5 (15% cut-off)
▪
Excellent infrastructure
▪
Northern Gas Pipeline runs through the project area.
▪
Adjacent to national highway and a high-quality water source
▪
Port and rail are under capacity allowing easy expansion of Wonarah project
▪
Scoping study commenced and ongoing to investigate production of critical end products for both Lithium Iron
Phosphate (LFP) batteries and fertiliser industries
DIRECTORS’ REPORT
8
Several milestones have been achieved during the past year which have assisted to move the Wonarah Project towards
development.
PROJECT MANAGER APPOINTMENT
Brian Campbell, an experienced chemical engineer, was appointed as Project Manager for the Wonarah Phosphate
Project. Mr Campbell has a history of leading engineering teams specializing in phosphate for leading global engineering
organisations including roles with Worley and ThyssenKrupp. Prior to joining Avenira, Mr Campbell was Managing
Director for PyroPhos Resources which developed a phosphoric acid project in Jordan.
SCOPING STUDY
Under the guidance of Project Manager, Brian Campbell, a Scoping Study commenced to investigate the potential for
development of the Wonarah Phosphate Project to supply products for the Lithium Iron Phosphate (LFP) battery market.
LFP batteries are widely used in electric vehicles and energy storage solutions and demand is currently at
unprecedented levels. At the end of the reporting period the scoping study was nearing completion.
RARE EARTH ELEMENT REVIEW
A review of the Rare Earth Element (REE) potential adjacent to the Wonarah project was undertaken, culminating with a
release to the ASX on 23 June 2022. At this time, a total of 282 samples had been analysed for REEs. There were
several anomalous intersections within (MPH unit) or stratigraphically above (CMU unit) the existing phosphate
mineralisation, with these intersections in the main not having been analysed for all 16 REEs.
Figure 2 REE Sample Locations
DIRECTORS’ REPORT
9
Figure 3 Stylised Cross Section showing stratigraphy with horizons containing anomalous REE analyses and the Wonarah Phosphate Resource
DIRECTORS’ REPORT
10
Significant REE intersections include:
HOLEID
WON035
WNWE004
WNRC0298
WNRC0909
WNRC0590
WNRC0338
WNRC0298
WNRC0298
WNRC0327
WNRC0408
WNRC0477
EAST (m)
657129
653093
655249
656252
652999
652497
655249
655249
655500
655497
655502
NORTH (m)
7789677
7789604
7789747
7792371
7787122
7786501
7789747
7789747
7792502
7790500
7791252
RL (m)
246
252
254
277
297
267
253
255
238
248
241
STRAT
CMU
CMU
MPH
MPH
MPH
MPH
MPH
MPH
MPH
MPH
MPH
ANALYTES
4
15
4
15
15
4
4
4
4
4
4
TREE (ppm)
1796
1061
933
801
737
673
682
668
578
518
494
TREO
(%)
0.210
0.128
0.114
0.097
0.089
0.084
0.083
0.082
0.070
0.063
0.060
THREO/TREO*
0%
49%
51%
47%
47%
59%
50%
51%
49%
47%
44%
FROM (m)
40
45
32
30
27
30
33
31
36
36
45
TO (m)
41
46
33
34
31
31
34
32
37
37
46
P2O5 (%)
1
-
33
15
13
26
26
19
20
14
18
LREE
(ppm)
Ce
750
209
300
157
150
165
220
200
185
165
165
Eu
5
5
5
Gd
32
26
23
La
550
116
180
104
96
130
135
140
120
120
120
Nd
410
131
97
90
Pr
32
23
22
Sm
86
29
21
19
HREE
(ppm)
Dy
45
23
23
Er
26
18
16
Ho
10
6
5
Lu
3
2
2
Sc
13
43
12
13
-2
13
9
Tb
6
4
4
Tm
3
2
2
Y
396
440
297
267
335
315
315
275
220
200
Yb
21
15
13
Table 1: Significant REE intersections
TENURE
The Wonarah Phosphate Project comprises of three granted exploration licences covering 1,452 km2 over 7 licences.
This is an increase from 152 km2 over 3 licences as of 30 June 2021.
DIRECTORS’ REPORT
11
Tenement ID
Status
Area (approx km2)
EL32359
LIVE
99
EL29840
LIVE
42
EL29849
LIVE
11
EL33062
PENDING
373
EL33063
PENDING
3
EL33192
PENDING
462
EL33193
PENDING
462
Table 2: Wonarah Phosphate Tenement Status
ANNUAL MINERAL RESOURCE STATEMENT AS AT 30 JUNE 2022
WONARAH PROJECT, NORTHERN TERRITORY, AUSTRALIA
Cut off
P2O5 %
Resource
Category
Tonnes
P2O5
Al2O3
CaO
Fe2O3
K2O
MgO
MnO
Na2O
SiO2
TiO2
Mt
%
%
%
%
%
%
%
%
%
%
10
Measured
78.3
20.8
4.85
28
1.11
0.43
0.25
0.04
0.1
39.7
0.21
Indicated
222
17.5
4.75
23.2
1.49
0.47
0.2
0.04
0.09
48.3
0.22
M+I
300
18.3
4.77
24.4
1.4
0.46
0.21
0.04
0.09
46.1
0.22
Inferred
512
18
4.8
24
2.1
0.5
0.2
0.08
0.05
46
0.2
15
Measured
64.9
22.4
4.47
30
1.1
0.37
0.19
0.04
0.09
37
0.19
Indicated
133
21.1
4.77
28
1.53
0.47
0.21
0.04
0.09
39.7
0.22
M+I
198
21.5
4.67
28.7
1.39
0.44
0.2
0.04
0.09
38.8
0.21
Inferred
335
21
4.5
28
2.0
0.5
0.2
0.10
0.06
39
0.2
Table 3: Wonarah Mineral Resource Statement
ANNUAL CHANGE IN RESOURCE CATEGORY
WONARAH PROJECT
Category
Inferred (10% cut-off)
Inferred 15% (cut-off)
Tonnes (M)
% P2O5
Tonnes (M)
% P2O5
2019
542
18
352
21
2020
512
18
335
21
Change
-30
-
-17
-
Table 4: Change in Mineral Resource Statement
The Mineral Resource estimates for the Wonarah project have decreased by approximately 5% in the Inferred Resource
category for tonnage. The grades remain unchanged from the 2019 estimates. The estimates for the Measured Resource
and Indicated Resource categories remain unchanged from 2019. The decrease in the Inferred Resource category is
due to a reduction in tenement area peripheral to the main mineralized zones.
The mineral resource statement is based on, and fairly represents, information and supporting documentation prepared
by a Competent Person.
The mineral resources statement as a whole is approved by Russell Fulton, a Competent Person who is a Member of the
Australian Institute of Geoscientists. Mr. Fulton is employed by Russell Fulton Pty Ltd. Mr. Fulton was the former Geological
Manager and a full-time employee of the Company and now provides geological consulting services to the Company. Mr.
Fulton has sufficient experience deemed relevant to the style of mineralisation and type of deposit under consideration and
to the activity which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian
Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr. Fulton consents to the inclusion in
the report of the matters based on his information in the form and context in which it appears.
DIRECTORS’ REPORT
12
JUNDEE SOUTH GOLD PROJECT, WESTERN AUSTRALIA (100% OWNED)
The Yandal Greenstone belt is located in the north-eastern part of the Norseman-Wiluna belt of the Archaean Craton in
Western Australia. It is one of few Archaean greenstone belts containing multiple million-ounce deposits, including Jundee,
Bronzewing and Darlot (Figure 4).
The Jundee South Project area is located within 3km of the Jundee Mine and covers more than a 60km strike of highly
prospective greenstone stratigraphy. The Project area contains major regional structures interpreted to control gold
mineralisation throughout the Yandal Greenstone Belt and contains a number of historically defined gold occurrences.
Access is via a well-established road system. Accommodation and facilities including flight services are well established in
the district, given the number of operating mines in the area.
Figure 4: Jundee South Project location map
DIRECTORS’ REPORT
13
During the period, the following achievements were recorded to advance the Jundee South Gold Project.
EXPLORATION INCENTIVE SCHEME (EIS)
A successful application was made to the Department of Mine, Industry and Regulation Safety for funds to assist with
testing of the Jundee Mine Sequence at depth west of the Nimary Fault adjacent to Jundee Mine and for the presence of
the Nimary Fault from TEMPEST, geological and aeromagnetic data. This funding provides 50% of the direct drilling
costs for the approved targets. Funding is available until the end of November 2022.
REVERSE CIRCULATION (RC) DRILLING PROGRAM
A drilling program comprising 23 holes for 4,894m was completed in Q4 2021. This program was designed to test for depth
extensions beneath priority regolith intercepts.
Figure 5 shows the locations of holes drilled and summary statistics for each target.
Figure 5. Location of holes drilled and summary statistics for targets tested.
MAIDEN RC DRILLING PROGRAM RESULTS
On 29 June 2022, the Company compiled a release to the ASX stating that it had received all composite sample results
from its maiden RC drilling program at Jundee. The location of the holes drilled, and these significant intercepts are
displayed in Figure 5 and tabulated in Table 5.
DIRECTORS’ REPORT
14
Hole
From
To
Width
Grade (g/t
Au)
Comment
JSRC_0002
104
108
4
0.12
Felsic Porphyry, 12% Qtz veins
JSRC_0003
108
112
4
0.10
6% Qtz veins
JSRC_0003
180
184
4
0.11
Felsic Porphyry, 2% Qtz veins, minor py
JSRC_0003
200
204
4
0.10
Felsic Porphyry
JSRC_0004
24
28
4
0.33
Minor quartz vein
JSRC_0004
96
100
4
0.10
Saprock contact, Felsic Porphyry
JSRC_0004
149
188
39
0.12
NS 144-149, minor qtz vein + pyrite
Including
149
152
3
0.23
JSRC_0005
48
52
4
0.12
Minor quartz veining
JSRC_0005
100
128
28
0.84
Minor quartz veining
Including
100
108
8
2.03
JSRC_0005
180
196
16
0.18
Structure with high water flow, minor qtz vein &
pyrite
including
180
188
8
0.25
JSRC_0005
212
216
4
0.20
Minor quartz veining
JSRC_0006
136
140
4
0.66
10% quartz vein
JSRC_0014
176
180
4
0.12
Mafic schist, minor quartz vein and pyrite
JSRC_0016
16
20
4
0.10
Felsic saprolite, minor quartz veining
JSRC_0016
220
224
4
0.19
Intermediate Porphyry, 1% Qtz vein
JSRC_0017
36
40
4
0.41
Minor quartz vein
JSRC_0017
144
148
(EOH)
4
0.21
Minor quartz vein & pyrite
JSRC_0017
156
160
4
1.04
15% quartz vein
JSRC_0017
280
284
4
0.32
Felsic porphyry – no vein/pyrite
JSRC_0018
80
88
8
1.06
20% quartz vein
JSRC_0018
164
180
16
0.14
Felsic Porphyry, minor qtz vein & minor py
JSRC_0018
208
228
20
0.12
Felsic Porphyry, 6% qtz vein & minor py
JSRC_0018
236
240
4
0.11
Felsic Porphyry, 2% qtz vein & minor py
JSRC_0019
224
228
4
0.11
Felsic Porphyry (EOH)
JSRC_0020
72
84
12
0.13
Felsic Porphyry with up to 8% Quatz veining &
2% oxidized sulphide
JSRC_0021
68
72
4
0.13
Intermediate Porphyry
JSRC_0021
160
164
4
7.29
Intermediate Porphyry with 4% Quartz veining
and 4% disseminated pyrite
JSRC_0021
164
168
4
0.15
Change in unit colour – intermediate porphyry
JSRC_0022
64
68
4
0.10
Dacite. Saprock transition
Table 5. Mineralised intersections from the Q4 RC program at Jundee South
Four of these intercepts are deemed as significant (JSRC_021, JSRC_005, JSRC_018, and JSRC_017). These results
are described in more detail below:
Significant intercept – 4m @ 7.29g/t Au in JSRC_0021
The intercept is a down-dip bedrock extension of the targeted anomaly in gcmDTRB289 (4m @ 0.87g/t Au). The intercept
is at a contact between two Intermediate porphyries, one being hematite rich. The contact is distinguished by weak
disseminated pyrite and quartz veining. The anomaly appears to sit along a magnetic high which links to the historic
anomaly of 4m @ 0.63g/t Au 640m to the SE.
DIRECTORS’ REPORT
15
Figure 6. Plan showing intercepts adjacent to JSRC_0021 and existing drilling over RTP_Tilt Aeromagnetics
Figure 7. Cross Section showing intercepts for JSRC_0021 and adjacent drilling.
DIRECTORS’ REPORT
16
Significant intercept – 28m @ 0.84g/t Au including 8m @ 2.03g/t Au in JSRC_0005
The anomaly is hosted within a felsic porphyry with minor quartz veining. The anomaly lies on a 1200m long zone of
anomalism which parallels but is offset from a highly magnetic feature. Potential exists on the SE half of this trend where
little drilling has been undertaken. Potential also exists at depth with the anomaly being at the bedrock interface.
Figure 8. Plan showing intercepts adjacent to JSRC_0005 and existing drilling over RTP_Tilt Aeromagnetics
Figure 9. Cross Section showing intercepts for JSRC_0005 and adjacent drilling.
DIRECTORS’ REPORT
17
Significant intercept – 8m @ 1.06g/t Au in JSRC_0018
Mineralisation quartz vein hosted within a felsic porphyry. This porphyry has a NW trend and an untested strike length of
600m. The intersection is at the bedrock interface and has potential at depth.
Figure 10. Plan showing intercepts adjacent to JSRC_0018 and existing drilling over Geological Interpretation
Figure 11. Cross Section showing intercepts for JSRC_0018 and adjacent drilling.
DIRECTORS’ REPORT
18
Significant intercept – 4m @ 1.04g/t Au in JSRC_0017
JSRC_0017 tested beneath historic intercepts of 3m @ 0.45g/t Au, 7m @ 0.24g/t Au and 1m @ 0.78g/t Au in holes
JSA20_125,JSA20_297 and JSA20_123 respectively, which were redox front anomalies associated with quartz veining.
JSRC_0017 was hosted in a moderately weathered felsic volcanic with moderate quartz veining and minor disseminated
sulphide. Potential exists at depth and along strike 400m to the ESE where historic hole gcmSHRB36 contains 4m @
9.68g/t Au.
Figure 12. Plan showing intercepts adjacent to JSRC_0017 and existing drilling over RTP Tilt Aeromagnetics.
Figure 13. Cross Section showing intercepts for JSRC_0017 and adjacent drilling.
DIRECTORS’ REPORT
19
In addition to this drilling success, the Jundee South Project has advanced the discussions around long-term land access
and increased the tenured land area.
HERITAGE ACCESS AGREEMENT
Significant advancements were made in negotiations with the Tarlka Matuwa Piarku Aboriginal Corporation (TMPAC)
towards execution of a long-term land access agreement. A meeting was held with the TMPAC board during the final
quarter of the reporting period to discuss the agreement and work towards finalising the agreement to commencing a long-
term mutually beneficial relationship.
TENURE
The Jundee South Project has continued to expand organically, expanding from 6 licences over 582km2 on 30 June
2021, to 1123km2 over 36 licences on 30 June 2022.
Tenement ID
Status
Area (approx km2)
E 36/1021
PENDING
70
E 36/1029
PENDING
79
E 37/1474
PENDING
6
E 37/1489
PENDING
3
E 53/1856
LIVE
105
E 53/1859
LIVE
104
E 53/2078
LIVE
176
E 53/2079
LIVE
194
E 53/2204
PENDING
61
E 53/2205
PENDING
34
E 53/2207
PENDING
6
E 53/2208
PENDING
9
E 53/2209
PENDING
101
E 53/2210
PENDING
31
E 53/2211
PENDING
3
E 53/2212
PENDING
43
E 53/2213
PENDING
3
E 53/2214
PENDING
3
E 53/2215
PENDING
3
E 53/2216
PENDING
3
E 53/2217
PENDING
3
E 53/2218
PENDING
3
E 53/2219
PENDING
3
E 53/2220
PENDING
3
E 53/2237
PENDING
15
E 53/2238
PENDING
3
E 69/4020
PENDING
46
P 37/9539
LIVE
1
P 37/9593
PENDING
1
P 37/9594
PENDING
1
DIRECTORS’ REPORT
20
Tenement ID
Status
Area (approx km2)
P 37/9595
PENDING
2
P 37/9596
PENDING
1
P 37/9630
PENDING
1
P 37/9631
PENDING
1
P 53/1712
LIVE
1
Table 6: Jundee South Tenement Status
COMPETENT PERSONS STATEMENT
The information in this report that relates to exploration results is based on and fairly represents information and supporting
documentation prepared by Mr. Steve Harrison, a Competent Person who is a member of the Australian Institute of
Geoscientists (AIG). Mr. Harrison is an employee of Avenira Limited and is a holder of options and shares in the company.
Mr. Harrison has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration
and to the activity being undertaken to qualify as a Competent Person as defined in the December 2012 edition of the
“Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves” (JORC Code). Mr Harrison
consents to the inclusion in the report of the matters based upon his information in the form and context in which it appears.
DIRECTORS’ REPORT
21
INVESTMENTS AND CORPORATE INFORMATION
BOARD AND EXECUTIVE CHANGES
In July 2021 the Company welcomed Roger Harris and Dr Geoffrey Xue to the Board as Non-executive Directors.
Mr. Harris and Dr Xue were appointed 8 July 2021 and 23 July 2021 respectively.
FINANCING
Fully Underwritten Entitlements Issue and Placement
During the year, the Company undertook a non-renounceable pro-rata entitlements issue (Entitlements Offer), under which
eligible shareholders had the opportunity to subscribe for two New Shares for every eight existing shares held at the issue
price of $0.013 per share.
The Entitlements Offer raised $1.4 million (before costs) and was fully underwritten.
In addition, the Company undertook a loan, which was repaid by the issue of 27 million shares at $0.013 per share to raise
$351,000.
DIRECTORS’ REPORT
22
FINANCIAL REVIEW
FINANCIAL INFORMATION
At 30 June 2022, the total closing cash balance was $1,009,638 (2021: $3,123,043). The Group has recorded an operating
loss after income tax for the year ended 30 June 2022 of $2,875,209 (2021: loss of $2,105,959).
OPERATING RESULTS FOR THE YEAR
Summarised operating results are as follows
2022
2021
REVENUE
$
RESULTS
$
Consolidated entity activities before income tax
10,179
29,026
Shareholder Returns
2022
2021
Basic loss per share from continuing operations (cents)
(0.32)
(0.26)
SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS
Other than detailed in the Review of Operations above there were no significant changes in the state of affairs of the
Group.
SIGNIFICANT EVENTS AFTER THE BALANCE DATE
Following the end of the financial year, the Company successfully undertook a placement to raise $2.1 million.
On 21 September 2022, the Company announced it had signed a non-binding MOU in relation to the Wonarah Project with
global LFP cathode manufacturer, Advanced Lithium Electrochemistry Ltd (Aleees) and the Northern Territory Government.
On 26 September 2022, the Company announced it had signed a non-binding MOU with LFP battery manufacturer, Aleees)
to work towards the development of a Lithium Iron Phosphate (LFP) battery cathode manufacturing plant in Darwin using
Avenira’s flagship Wonarah Phosphate Project.
Other than as disclosed above, no event has occurred since 30 June 2022 that would materially affect the operations of the
Group, the results of the Group or the state of affairs of the Group.
RISK MANAGEMENT
The Board is responsible for ensuring that risks, and opportunities, are identified on a timely basis and that activities are
aligned with the risks and opportunities identified by the Board.
The Company believes that it is crucial for all Board members to be a part of this process, and as such the Board has not
established a separate risk management committee.
The Board has a number of mechanisms in place to ensure that management’s objectives and activities are aligned with
the risks identified by the Board. These include the following:
•
Board approval of a strategic plan, which encompasses strategy statements designed to meet stakeholders’ needs
and manage business risk.
•
Implementation of Board approved operating plans and budgets and Board monitoring of progress against these
budgets.
DIRECTORS’ REPORT
23
SAFETY AND HEALTH
Avenira aspires to a goal of causing zero harm to people. In this regard, the Company is committed to undertake our
activities so as to protect the safety and health of employees, contractors, visitors and the communities in which we
operate. There were no lost time injuries during the year.
ENVIRONMENTAL REGULATION AND PERFORMANCE
The Group is subject to significant environmental regulation with respect to its exploration activities.
The Group aims to ensure the appropriate standard of environmental care is achieved, and in doing so, as far as it is
aware is in compliance with all environmental legislation. The directors of the Group are not aware of any breach of
environmental legislation for the year under review.
DIRECTORS’ MEETINGS
During the year the number of meetings of directors (including meetings of committees of directors) and the number of
meetings attended by each director were as follows:
DIRECTORS MEETINGS
AUDIT COMMITTEE MEETINGS
REMUNERATION AND
NOMINATION COMMITTEE
MEETINGS
A
B
A
B
A
B
Brett Clark
9
9
*
*
*
*
Winnie Lai Hadad
9
9
2
2
-
-
Kevin Dundo
9
9
2
2
-
-
Roger Harris (1)
8
8
*
*
*
-
Geoff Xue (1)
7
7
2
2
-
-
(1)
Appointed 8th July and 23 July 2021 respectively.
Notes
A – Number of meetings attended.
B – Number of meetings held during the time the director held office or was a member of the Committee during the year.
* – Not a member of the Committee.
SHARES UNDER OPTION
At the date of this report there are 100,076,281 unissued ordinary shares in respect of which options are outstanding.
NUMBER OF OPTIONS
Share options
Issued 24 December 2019 ($0.02)
24,000,000
Issued 24 December 2019 ($0.03)
24,000,000
Issued 08 September 2020 ($0.025)
6,000,000
Issued 08 September 2020 ($0.035)
6,000,000
Issued 21 September 2021 ($0.02)
1,500,000
Issued 21 September 2021 ($0.03)
1,500,000
Issues 29 April 2022 ($0.02)
37,076,281
Total number of options outstanding as at the date of this report
100,076,281
INSURANCE OF DIRECTORS AND OFFICERS
During or since the financial year, the Company has paid premiums insuring all the directors of Avenira Limited against
DIRECTORS’ REPORT
24
costs incurred in defending proceedings for conduct involving:
a.
willful breach of duty; or
b. a contravention of sections 182 or 183 of the Corporations Act 2001, as permitted by section 199B of the Corporations
Act 2001.
The total amount of insurance contract premiums paid in 2022 is $75,998 (2021: $82,305)
NON-AUDIT SERVICES AND INDEMNIFICATION OF AUDITORS
Details of amounts paid or payable to the auditor for audit and non-audit services provided during the period, and an
assessment by the Board of whether non-audit service provided during the period are compatible with general standards
of independence for auditors imposed by the Corporations Act 2001 are set out in Note 19 - Remuneration of Auditors,
to the Consolidated Financial Statements.
To the extent permitted by law, the Company has agreed to indemnify its auditors, Hall Chadwick WA Audit Pty Ltd, as
part of the terms of its audit engagement agreement against claims by third parties arising from the audit (for an
unspecified amount). No payment has been made to indemnify Hall Chadwick during or since the financial year.
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 any part of those proceedings.
No proceedings have been brought or intervened in on behalf of the Company with leave of the Court under section 237
of the Corporations Act 2001.
CORPORATE GOVERNANCE
In recognising the need for the highest standard of corporate behaviour and accountability, the Directors of Avenira Limited
support and adhered to the principles of sound corporate governance. The Board recognises the recommendations of the
Australia Securities Exchange Corporate Governance Council, and considers that Avenira Limited is in compliance, to the
extent with those guidelines, which are of importance to the commercial operation of a junior listed resources company.
During the financial year, shareholders continued to receive the benefit of an efficient and cost-effective corporate
governance policy for the Company.
The Company has established a set of corporate governance policies and procedures and these can be found within the
Company’s Corporate Governance section on the Company’s website: http://www.avenira.com/about-us/governance.
AUDITOR’S INDEPENDENCE DECLARATION
A copy of the auditor’s independence declaration as required under section 307C of the Corporations Act 2001 is set
out on page 32.
DIRECTORS’ REPORT
25
REMUNERATION REPORT - AUDITED
The remuneration report is set out under the following main headings:
A. Introduction
B. Remuneration governance
C. Overview of executive remuneration
D. Details of remuneration of Key Management Personnel
E.
Executive KMP employment agreements
F.
Overview of Non-executive Director remuneration
G. Share-based compensation
H. Equity holdings
A. INTRODUCTION
The remuneration report for the year ended 30 June 2022 outlines the director and executive remuneration arrangements
of the Company and Group.
The information in this remuneration report has been provided in accordance with section 300A of the Corporations Act
2001. The information has been audited as required by section 308(3C) of the Corporations Act 2001.
For the purpose of this report, Key Management Personnel (“KMP”) of the Group are defined as those persons having
authority and responsibility for planning, directing and controlling the major activities of the Company and Group, directly
or indirectly, including any Director (whether executive or otherwise) of the Company.
The table below outlines the KMP of the Group during the financial year ended 30 June 2022. Unless otherwise indicated,
the individuals were KMP for the entire financial year.
NAME
POSITION
TERM AS KMP
Directors
Brett Clark
Executive Chairman and CEO
Full financial year
Winnie Lai Hadad
Non-executive Director
Full financial year
Kevin Dundo
Non-executive Director
Full financial year
Roger Harris
Non-executive Director
Appointed 8 July 2021
Geoff Xue
Non-executive Director
Appointed 23 July 2021
B. REMUNERATION GOVERNANCE
Remuneration and Nomination Committee
The Board retains overall responsibility for remuneration policies and practices within the Group.
The Board has established a Remuneration and Nomination Committee (“RNC”) which operates in accordance with its
charter as approved by the Board. A copy of the charter is available under the corporate governance section of the
Group’s website.
The RNC is primarily responsible for making recommendations to the Board on remuneration arrangements for Executive
Directors, Non-executive Directors and other Senior Executives. The Corporate Governance Statement provides further
information on the role of this committee.
The RNC meets as required throughout the year. Refer to page 23 for the number of Committee meetings held during
the year. The Executive Chairman/CEO attends certain RNC meetings by invitation, where management input is required.
The Executive Chairman/CEO is not present during any discussions relating to his own remuneration arrangements.
DIRECTORS’ REPORT
26
Use of remuneration consultants
No remuneration consultants were engaged during the financial year.
Securities trading policy
The Groups securities trading policy applies to all Non-executive Directors and executives. The policy prohibits employees
from dealing in Avenira Limited securities while in possession of material non-public information relevant to the Group.
The policy is available to be viewed within the corporate governance section of the Company’s website.
Voting and comments – 2021 Annual General Meeting (AGM)
The 2021 remuneration report was passed on a poll by 92% of votes cast at the 2021 AGM. The Company did not receive
any specific feedback at the AGM regarding its remuneration practices.
C. OVERVIEW OF EXECUTIVE REMUNERATION
The remuneration policy of Avenira Limited has been designed to align executives’ objectives with shareholders and
business objectives. The Board of Avenira believes the policy to be appropriate and effective in its ability to:
•
attract and retain high quality directors and executives to run and manage the Company.
•
create goal congruence between directors, executives and shareholders.
The executive KMP receive an appropriate level and mix of remuneration consisting of fixed remuneration and variable
remuneration in the form of incentive opportunities. The RNC reviews executive KMP packages annually by reference to
the Group’s performance, executive performance and comparable information from industry sectors and other listed
companies in similar industries.
Elements of Executive Remuneration
The executive remuneration framework is comprised of:
a.
Fixed Remuneration - Base Salary, including superannuation (if applicable)
b.
Variable Remuneration - Incentives and Cash Bonuses
1.
FIXED REMUNERATION - BASE SALARY, INCLUDING SUPERANNUATION
All executive KMPs receive a base cash salary (which is based on factors such as scope of the role, skills, experience,
location and length of service) and superannuation contributions, where applicable. The executive KMPs, where
applicable, receive a superannuation guarantee contribution required by the government, which is currently 10.00%,
and do not receive any other retirement benefits.
2.
VARIABLE REMUNERATION – INCENTIVES AND CASH BONUSES
Incentives in the form of equities and cash bonuses are provided to certain executive KMP at the Board’s discretion.
The policy is designed to provide a variable “at risk” component within the executive KMP’s total remuneration
packages to attract, retain and motivate the highest calibre of executive KMP and reward them for performance that
results in long term growth in shareholder wealth through achievement of the Company’s financial and strategic
objectives.
Receipt of variable remuneration in any form is not guaranteed under any executive KMP’s employment contract.
DIRECTORS’ REPORT
27
2.1
LONG TERM INCENTIVE (LTI)
In 2020, 48,000,000 Options were issued to the Directors as LTI’s.
No LTI’s were issued in 2022. Refer to Section G of the Remuneration Report for further details.
2.2
SHORT TERM INCENTIVE (STI)
Under the STI, certain executives have the opportunity to earn an annual incentive award. The STI recognises
and rewards annual performance. The bonus KPIs are chosen as they reflect the core drivers of the short-term
performance and also provide a framework for delivering sustainable value to the Group and its shareholders.
Executive Chairman/CEO 2022 Short-Term Incentive
The Executive Chairman/CEO, Mr Brett Clark, is engaged pursuant to a Consultant Service Agreement, which
provides for Mr Clark to participate in a short term incentive scheme on a yearly basis, being no more than an
incentive payment of 50% of his yearly remuneration, based on certain non-financial measures.
A summary of the non-financial measures to be achieved and their weightings are set out in the table below:
SUMMARY
%
Complete corporate transactions as directed by the Board
30
Arrange a sale of strategic asset
30
Complete as planned and in budget initial exploration on Jundee
South and develop long term plan for the Jundee Project
15
Individual Performance Review
25
The Board approved the final STI award based on assessment of performance against the non-financial
measures.
Based on the assessment and following the end of the 2022 financial year, a bonus of $80,000 was approved for
the Executive Chairman and CEO Mr. Brett Clark of which $40,000 will be issued in options to be approved at the
Company’s next AGM.
Relationship between remuneration policy and company performance
The remuneration policy has been tailored to increase the direct goal congruence between shareholders, directors and
executives.
The table below shows the performance of the Company over the last 5 years:
2022
2021
2020
2019
2018
EPS (cents)
(0.32)
(0.26)
(0.54)
(0.30)
(0.42)
Share Price
$0.009
$0.007
$0.009
$0.006
$0.02
Net Profit / (Loss) before
discontinued operations
(2,875,209)
(2,105,959)
(3,395,173)
(3,084,624)
3,225,309
As the Company is in the development phase the performance of the Company is not related to the profit or earnings of
the Company.
DIRECTORS’ REPORT
28
D. DETAILS OF REMUNERATION OF KEY MANAGEMENT PERSONNEL (KMP)
The table below shows details of each component of total remuneration for KMP.
SHORT-TERM
POST EMPLOYMENT
LONG-TERM
SHARE-BASED PAYMENTS
SALARY & FEES
BONUS (4)
NON-
MONETARY (3)
SUPERANNUATION
TERMINATION
BENEFITS
LONG SERVICE
LEAVE
ANNUAL LEAVE
TOTAL CASH
RELATED
PERFORMANCE
RIGHTS
OPTIONS (4)
TOTAL
REMUNERATION
PERFORMANCE
RELATED
$
$
$
$
$
$
$
$
$
$
$
%
Directors
Brett Clark
2022
250,000
40,000
56,044
25,000
-
-
-
371,044
-
40,000
411,044
-
2021
250,000
45,000
46,688
23,750
-
-
-
365,438
-
-
365,438
-
Winnie Lai Hadad
2022
72,000
-
-
7,200
-
-
-
79,200
-
-
79,200
-
2021
72,000
-
-
6,840
-
-
-
78,840
-
-
78,840
-
Kevin Dundo
2022
72,000
-
-
7,200
-
-
-
79,200
-
-
79,200
-
2021
72,000
-
-
6,840
-
-
-
78,840
-
-
78,840
-
Roger Harris (1)
2022
70,645
-
-
7,065
-
-
-
77,710
-
-
77,710
-
2021
-
-
-
-
-
-
-
-
-
-
-
-
Geoff Xue (2)
2022
67,636
-
-
6,774
-
-
-
74,410
-
-
74,410
-
2021
-
-
-
-
-
-
-
-
-
-
-
-
Total KMP compensation
2022
532,281
40,000
56,044
53,239
-
-
-
681,564
-
40,000
721,564
2021
394,000
45,000
46,688
37,430
-
-
-
523,118
-
-
523,118
(1) Roger Harris appointed as Non-Executive Director on 8 July 2021.
(2) Geoff Xue was appointed as Non-Executive Director on 23 July 2021.
(3) Non-monetary benefits include car lease payments and income insurance.
(4) Bonus & Options were approved by the board, however, were not paid paid/ issued at balance date. Refer to Part C para. 2.2 in the Directors Report for more details.
DIRECTORS’ REPORT
29
E.
EXECUTIVE KMP EMPLOYMENT AGREEMENTS
The Group has entered into formal employment contracts with Executive KMP. The employment contracts for executive
KMP have no fixed term and do not prescribe how remuneration levels are to be modified from year to year. A summary of
the main provisions of these contracts for the year ended 30 June 2022 are set out below:
NAME
TERMS
Brett Clark (Executive
Chairman and CEO)
Base salary of $250,000 (exclusive of superannuation contributions), reviewed
annually.
6 months’ notice by Mr. Clark. 6 months by Company and upon change of control.
Termination payments to reflect appropriate notice, except in cases of termination
for cause.
Two tranches of 12,000,000 options issued to Mr. Clark approved by shareholders
29 November 2019.
Mr. Clark shall be eligible to participate in Short Term Incentive Schemes up to 50%
of his base salary that the Company may offer.
F.
OVERVIEW OF NON-EXECUTIVE DIRECTOR REMUNERATION
The Board policy is designed to attract and retain high caliber directors and to remunerate Non-executive Directors at
market rates for comparable companies for time, commitment, and responsibilities. The Board determines payments to
the Non-executive Directors and reviews their remuneration annually, based on market practice, duties and accountability. The
Executive Chairman’s fee will be determined independently to the fees of the Non-executive Directors based on
comparative roles in the external market. External advice from independent remuneration consultants is sought when
required.
The maximum aggregate amount of fees that can be paid to Non-executive Directors is subject to approval by
shareholders at the Annual General Meeting. The most recent determination was at the November 2016 Annual
General Meeting, where shareholders approved the maximum aggregate amount of fees that can be paid to Non-
executive Directors to be $600,000.
The Company makes superannuation contributions on behalf of the Non-executive Directors in accordance with its
Australian statutory superannuation obligations, and each director may sacrifice part of their fee for further superannuation
contribution by the Company.
Any equity components of Non-executive Directors’ remuneration, including the issue of options or Performance
Rights, are required to be approved by shareholders prior to award.
The table below summaries the Non-executive fees for the 2022 financial year:
BASE FEES 2022
BASE FEES 2021
Board
Non-executive Directors
$72,000
$72,000
Committee
Audit Chair
Nil
Nil
Remuneration and Nomination Chair
Nil
Nil
Termination payments
The Board must approve all termination payments provided to all employees at the level of director, executive or senior
management to ensure such payments reflect the Company’s remuneration policy and are in accordance with the
Corporations Act 2001.
DIRECTORS’ REPORT
30
G. SHARE-BASED COMPENSATION
There were no share-based payments issued to directors or other KMP during the 2022 financial year.
Share based compensation – Option Holdings
Option Holdings affecting remuneration in the current or future reporting period are as follows:
Key terms of options granted to KMP
NUMBER VESTED
GRANT DATE
NUMBER
GRANTED
DURING THE
YEAR
VESTING DATE
EXPIRY DATE
FAIR VALUE PER
OPTION AT
GRANT DATE, $
EXERCISE
PRICE, $
VESTED
%
2020
TRANCHE 1
Directors
Brett Clark
29-Nov-19
12,000,000
29-Nov-19
30-Nov-22
$0.008
$0.02
100%
Winnie Lai Hadad
29-Nov-19
6,000,000
29-Nov-19
30-Nov-22
$0.008
$0.02
100%
Kevin Dundo
29-Nov-19
6,000,000
29-Nov-19
30-Nov-22
$0.008
$0.02
100%
TRANCHE 2
Directors
Brett Clark
29-Nov-19
12,000,000
29-Nov-19
30-Nov-22
$0.007
$0.03
100%
Winnie Lai Hadad
29-Nov-19
6,000,000
29-Nov-19
30-Nov-22
$0.007
$0.03
100%
Kevin Dundo
29-Nov-19
6,000,000
29-Nov-19
30-Nov-22
$0.007
$0.03
100%
Further information is set out in Note 28 of the financial statements.
DIRECTORS’ REPORT
31
H.
EQUITY HOLDINGS
Option Holdings
The number of options over ordinary shares in the Company held during the financial year by each director of Avenira
Limited and other KMP of the Group, including their personally related parties, are set out below:
BALANCE AT
START OF THE
YEAR
GRANTED AS
COMPENSATION
ACQUIRED
FROM
ENTITLEMENTS
ISSUE
EXPIRED
BALANCE AT
END OF THE
YEAR
VESTED
AND
EXERCISABLE
2022
Directors
Brett Clark
24,000,000
-
-
-
24,000,000
24,000,000
Winnie Lai Hadad
12,000,000
-
-
-
12,000,000
12,000,000
Kevin Dundo
12,000,000
-
260,416
-
12,260,416
12,260,416
Roger Harris
-
-
434,621
-
434,621
434,621
Geoff Xue
-
-
-
-
-
-
All vested options were exercisable at the end of the year. Full details can be found at Note 16.
Shareholdings
The number of shares in the Company held during the financial year by each director of Avenira Limited and other KMP
of the Group, including their personally related partied, are set as follows:
(1) Opening balance held by Roger Harris at date of appointment 8 July 2021
None of the shares above are held nominally by the directors or any of the KMP.
There were no other transactions and balances with KMP and their related parties other than as disclosed.
End of Remuneration Report
Signed in accordance with a resolution of the directors.
BRETT CLARK
Executive Chairman
Perth, 28 September 2022
BALANCE AT START
OF THE YEAR
RECEIVED DURING
THE YEAR FOR
RIGHTS
CONVERTED
OTHER CHANGES
DURING THE YEAR
BALANCE AT END
OF THE YEAR
2022
Directors
Brett Clark
-
-
-
-
Winnie Lai Hadad
-
-
-
-
Kevin Dundo
6,250,000
-
781,250
7,031,250
Roger Harris (1)
11,430,928
-
1,303,866
12,734,794
Geoff Xue
-
-
-
-
To the Board of Directors
AUDITOR’S INDEPENDENCE DECLARATION UNDER SECTION 307C OF THE
CORPORATIONS ACT 2001
As lead audit director for the audit of the financial statements of Avenira Limited for the year ended 30 June
2022, I declare that to the best of my knowledge and belief, there have been no contraventions of:
•
the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
•
any applicable code of professional conduct in relation to the audit.
Yours faithfully,
HALL CHADWICK WA AUDIT PTY LTD
D M BELL CA
Director
Dated this 28th day of September 2022
Perth, Western Australia
33
QUALIFYING STATEMENTS
STATEMENT OF GOVERNANCE ARRANGEMENTS AND INTERNAL CONTROLS
Governance of Avenira Limited’s Mineral Resources estimation process is a key responsibility of the Executive Management
of the Company.
The Chief Geologist of the Company oversees technical reviews of the estimates and the evaluation process is augmented by
utilising Avenira’s in-house knowledge in operational and project management, ore processing and commercial/financial areas.
The Company also utilises external consultants for these purposes.
The Chief Geologist is responsible for managing all Avenira’s drilling programs, including resource definition drilling. The
estimation of Mineral Resources is done by an independent contractor, MPR Geological Consultants Pty Ltd.
The Company has adopted quality assurance and quality control protocols based on current and best practice regarding all field
aspects including drill hole surveying, drill sample collection, sample preparation, sample security, provision of duplicates,
blanks and matrix-matched certified reference materials. All geochemical data generated by laboratory analysis is examined
and analysed by the Chief Geologist before accession to the Company database.
Data is subject to additional vetting by the independent contractor who carries out the resource estimates. Resource estimates
are based on well-founded, industry-accepted assumptions and compliance with standards set out in the Australasian Code
for Reporting of Exploration Results, Mineral Resources and Ore Reserves.
Mineral resource estimates are subject to peer review by the independent contractor and a final review by Avenira’s
Executive Management before market release.
Avenira Limited reports its mineral resources and ore reserves on an annual basis, in accordance with the Australian Code for
Reporting of Exploration Results, Mineral Resources and Ore Reserves (the JORC code) 2012 Edition.
PREVIOUSLY REPORTED RESULTS
There is information in this report relating to Mineral Resource estimates which was previously reported on 15 Mar 2013, 30 Apr
2014 and 31 Jan 2020. The Company confirms that it is not aware of any new information or data that materially affects the
information included in the original market announcements and, in the case of estimates of Mineral Resources or Ore Reserves that
all material assumptions and technical parameters underpinning the estimates in the relevant market announcement continue to
apply and have not materially changed. The company confirms that the form and context in which the Competent Person’s findings
are presented have not been materially modified from the original market announcement.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION
All statements, trend analysis and other information contained in this document relative to markets for Avenira’s trends in resources,
recoveries, production and anticipated expense levels, as well as other statements about anticipated future events or results constitute
forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as “seek”,
“anticipate”, “believe”, “plan”, “estimate”, “expect” and “intend” and statements that an event or result “may”, “will”, “should”, “could” or
“might” occur or be achieved and other similar expressions. Forward-looking statements are subject to business and economic risks
and uncertainties and other factors that could cause actual results of operations to differ materially from those contained in the forward-
looking statements. Forward-looking statements are based on estimates and opinions of management at the date the statements are
made. Avenira does not undertake any obligation to update forward-looking statements even if circumstances or management’s
estimates or opinions should change. Investors should not place undue reliance on forward-looking statements.
34
CONSOLIDATED STATEMENT OF PROFIT AND LOSS AND OTHER COMPREHENSIVE
INCOME
YEAR ENDED 30 JUNE 2022
CONSOLIDATED
NOTES
2022
$
2021
$
INCOME
Interest income
5
7,024
18,086
Other income
5
3,155
10,940
EXPENDITURE
Depreciation and amortisation expense
(34,492)
(34,214)
Salaries and employee benefits expense
6
(1,139,158)
(857,575)
Net foreign currency gain/(loss)
(1,560)
51
Impairment of exploration and evaluation expenditure
12
(676,173)
(92,924)
Interest expense - leases
11
(2,207)
(4,515)
Share based payment (expense)/reversal
28
(7,334)
(77,919)
Administrative and other expenses
6
(878,664)
(1,067,889)
Extinguishment of financial liabilities
26
(145,800)
-
LOSS BEFORE INCOME TAX
(2,875,209)
(2,105,959)
INCOME TAX BENEFIT
7
-
-
LOSS FOR THE YEAR
(2,875,209)
(2,105,959)
OTHER COMPREHENSIVE INCOME
Items that may be reclassified subsequently to Profit or Loss, net of tax
Financial assets measured at fair value through profit and loss
Net fair value gain / (loss) on financial assets measured at fair value through OCI
(1,845,052)
418,550
TOTAL COMPREHENSIVE INCOME / (LOSS) FOR THE YEAR
(4,720,261)
(1,687,409)
Income / (Loss) for the year is attributable to:
Owners of Avenira Limited
(2,875,209)
(2,105,959)
(2,875,209)
(2,105,959)
Total comprehensive income / (loss) for the year is attributable to:
Owners of Avenira Limited
(4,720,261)
(1,687,409)
(4,720,261)
(1,687,409)
LOSS PER SHARE
From operations
Basic profit per share (cents)
27
(0.32)
(0.26)
Diluted profit per share (cents)
27
(0.32)
(0.26)
The above Consolidated Statement of Profit and Loss and Other Comprehensive Income should be read in conjunction with the Notes
to the Consolidated Financial Statements.
35
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2022
CONSOLIDATED
NOTES
2022
$
2021
$
CURRENT ASSETS
Cash and cash equivalents
8
1,009,638
3,123,043
Trade and other receivables
9
140,646
129,209
TOTAL CURRENT ASSETS
1,150,284
3,252,252
NON-CURRENT ASSETS
Other assets
10
1,481,600
1,481,600
Financial assets
18
831,296
1,718,543
Plant and equipment
1,788
-
Capitalised exploration and evaluation expenditure
12
8,927,892
7,511,257
Right-of-use assets
11
14,320
48,800
TOTAL NON-CURRENT ASSETS
11,256,896
10,760,200
TOTAL ASSETS
12,407,180
14,012,452
CURRENT LIABILITIES
Trade and other payables
13
679,679
527,286
Lease Liability
11
16,412
38,148
Provisions
14
66,122
43,404
Amounts received in advance on sale of financial assets
-
31,306
TOTAL CURRENT LIABILITIES
762,213
640,144
NON-CURRENT LIABILITIES
Provisions
14
2,105,817
1,768,081
Lease Liability
11
-
16,741
Loans and borrowings
15
3,202,956
2,480,000
TOTAL NON-CURRENT LIABILITIES
5,308,773
4,264,822
TOTAL LIABILITIES
6,070,986
4,904,966
NET ASSETS
6,336,194
9,107,486
EQUITY
Issued capital
16
142,385,648
140,516,513
Reserves
17(a)
16,525,327
18,290,545
Accumulated losses
17(b)
(152,574,781)
(149,699,572)
Capital and reserves attributable to members of Avenira Limited
6,336,194
9,107,486
TOTAL EQUITY
6,336,194
9,107,486
The above Consolidated Statement of Financial Position should be read in conjunction with the Notes to the Consolidated Financial
Statements.
36
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2022
ATTRIBUTABLE TO OWNERS OF AVENIRA LIMITED
CONSOLIDATED
NOTES
ISSUED CAPITAL
RESERVES
ACCUMULATED LOSSES
TOTAL
$
$
$
$
BALANCE AT 30 JUNE 2020
137,337,162
25,259,540
(155,059,077)
7,537,625
Loss for the year
-
-
(2,105,959)
(2,105,959)
Other comprehensive income/(loss) for the year
-
418,550
-
418,550
TOTAL COMPREHENSIVE INCOME FOR THE YEAR
-
418,550
(2,105,959)
(1,687,409)
TRANSACTIONS WITH OWNERS IN THEIR CAPACITY AS OWNERS
Shares issued during the year
3,376,783
-
-
3,376,783
Share issue transaction costs
(197,432)
-
-
(197,432)
Share based payment
28
-
77,919
-
77,919
NCI Reserve transfer
-
(7,465,464)
7,465,464
-
BALANCE AT 30 JUNE 2021
140,516,513
18,290,545
(149,699,572)
9,107,486
Loss for the year
-
-
(2,875,209)
(2,875,209)
Other comprehensive income/(loss) for the year
-
(1,845,052)
-
(1,845,052)
TOTAL COMPREHENSIVE INCOME FOR THE YEAR
-
(1,845,052)
(2,875,209)
(4,720,261)
TRANSACTIONS WITH OWNERS IN THEIR CAPACITY AS OWNERS
Shares issued during the year
1,942,811
-
-
1,942,811
Unissued shares during the year
16
-
-
16
Share issue transaction costs
(73,692)
-
-
(73,692)
Share based payment
28
-
79,834
-
79,834
BALANCE AT 30 JUNE 2022
142,385,648
16,525,327
(152,574,781)
6,336,194
The above Consolidated Statement of Changes in Equity should be read in conjunction with the Notes to the Consolidated Financial Statements.
37
CONSOLIDATED STATEMENT OF CASH FLOWS
YEAR ENDED 30 JUNE 2022
CONSOLIDATED
NOTES
2022
$
2021
$
CASH FLOWS FROM OPERATING ACTIVITIES
Payments to suppliers and employees
(1,606,699)
(1,737,879)
Receipts for other income
3,155
10,940
Interest received
7,024
17,448
Payment of lease interest
(2,207)
(4,515)
NET CASH (OUTFLOW) FROM OPERATING ACTIVITIES
26
(1,598,727)
(1,714,006)
CASH FLOWS FROM INVESTING ACTIVITIES
Payments for exploration expenditure
(1,705,072)
(1,231,448)
Payments for plant and equipment
(2,437)
-
Receipts received in advance for sale of financial instruments
-
31,306
Purchase of financial instruments
(2,321,927)
(875,000)
Proceeds from sale of financial instruments
1,332,815
-
NET CASH (OUTFLOW) FROM INVESTING ACTIVITIES
(2,696,621)
(2,075,142)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from share-buy back
-
3,376,783
Proceeds from issue of shares
1,446,027
Transaction costs on issue of shares
(73,692)
(197,432)
Proceeds from loans and borrowings
845,649
2,480,000
Payment of principal portion of lease liabilities
(34,480)
(35,548)
NET CASH INFLOW FROM FINANCING ACTIVITIES
2,183,504
5,623,803
NET (DECREASE)/INCREASE IN CASH AND CASH
EQUIVALENTS
(2,111,844)
1,834,655
Cash and cash equivalents at the beginning of the financial year
3,123,043
1,288,337
Effects of exchange rate changes on cash and cash equivalents
(1,561)
51
CASH AND CASH EQUIVALENTS AT THE END OF THE FINANCIAL
YEAR
8
1,009,638
3,123,043
The above Consolidated Statement of Cash Flows should be read in conjunction with the Notes to the Consolidated
Financial Statements.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, YEAR ENDED 30 JUNE 2022
38
1. BASIS OF PREPARATION
The financial statements are for the consolidated entity consisting of Avenira Limited and its subsidiaries (the “Company”
or the “Group). The financial statements are presented in the Australian currency. Avenira Limited is a for profit company
limited by shares, domiciled and incorporated in Australia, whose shares are publicly traded on the Australian Securities
Exchange. The Company’s registered office and principal place of business is Suite 6, 100 Mill Point Road South Perth
WA 6151. The financial statements were authorised for issue in accordance with a resolution of the directors on 23
September 2022. The directors have the power to amend and reissue the financial statements.
These general-purpose financial statements have been prepared in accordance with Australian Accounting Standards,
other authoritative pronouncements of the Australian Accounting Standards Board and the Corporations Act 2001. The
accounting policies outlined throughout the financial statements have been consistently applied to all the years
presented, unless otherwise stated.
Compliance with IFRS
The financial statements of the Group also comply with International Financial Reporting Standards (IFRS) as issued
by the International Accounting Standards Board (IASB).
Historical cost convention
The financial statements have been prepared under the historical cost convention, modified, where applicable by the
measurement at fair value of selected non-current assets, financial assets and financial liabilities.
Functional and presentation currency
The financial statements are presented in Australian dollars, which is the Group’s reporting currency and the functional
currency of the parent company and its Australian subsidiaries.
Foreign currency transactions are translated into the functional currency 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 year end exchange rates of monetary assets and liabilities denominated in foreign currencies are
recognised in profit or loss, except when they are deferred in equity as qualifying cash flow hedges and qualifying net
investment hedges or are attributable to part of the net investment in a foreign operation. Translation differences on
financial assets and liabilities carried at fair value are reported as part of the fair value gain or loss. Translation
differences on non-monetary financial assets and liabilities such as equities held at fair value through profit or loss are
recognised in profit or loss as part of the fair value gain or loss. Translation differences on non-monetary financial assets
such as equities classified as available-for-sale financial assets are included in the fair value reserve in equity.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, YEAR ENDED 30 JUNE 2022
39
1. BASIS OF PREPARATION (continued)
Going concern
The financial report has been prepared on the going concern basis which contemplates the continuity of normal business
activity, the realisation of assets and the settlement of liabilities in the ordinary course of business.
For the year ended 30 June 2022 the Group made a loss of $2,875,209 (2021: $2,105,959) and net operating cash outflows
of $1,598,727 (2021: $1,714,006).
The ability of the Group to continue as a going concern is principally dependent sale of liquid investments and additional
capital raising. The Group has recently completed a $2.1 million capital raising.
The directors have prepared a cash flow forecast, which indicates that the Group will have sufficient cash flows to meet all
commitments and working capital requirements for the 12-month period from the date of signing this financial report.
The Directors believe it is appropriate to prepare these accounts on going concern basis for the following reasons:
•
The Group holds liquid financial assets that can be sold to meet cash flow requirements;
•
The Company has the ability to raise capital; and
•
The Group has the ability to reduce corporate and overhead expenditures in line with available funds if required.
Based on the cash flow forecasts and other factors referred to above, the Directors are satisfied that the going concern
basis of preparation is appropriate. In particular, given the Group’s history of raising capital to date, the directors are
confident of the Group’s ability to raise additional funds as and when they are required.
Should the Group be unable to continue as a going concern it may be required to realise its assets and extinguish its
liabilities other than in the normal course of business and at amounts different to those stated in the financial
statements. The financial statements do not include any adjustments relating to the recoverability and classification of
asset carrying amounts or to the amount and classification of liabilities that might result should the Group be unable to
continue as a going concern and meet its debts as and when they fall due.
Critical accounting estimates
The preparation of financial statements requires management to use estimates, judgements, and assumptions.
Application of different assumptions and estimates may have a significant impact on Avenira’s net assets and financial
results. Estimates and assumptions are reviewed on an ongoing basis and are based on the latest available information
at each reporting date. Actual results may differ from the estimates.
The areas involving a higher degree of judgement and complexity, or areas where assumptions are significant to the
financial statements are:
Note 12 Impairment of capitalised exploration and evaluation expenditure
Note 14 Provision for mine rehabilitation and restoration
Note 28 Share based payments
Comparative Figures
When required by the accounting standards, comparative figures have been adjusted to conform to changes in
presentation for the current financial year.
When the Group applies an accounting policy retrospectively, makes a retrospective restatement or reclassifies items in
its financial statements, a statement of financial position as at the beginning of the earliest comparative period will be
disclosed.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, YEAR ENDED 30 JUNE 2022
40
1. BASIS OF PREPARATION (continued)
Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of associated GST, unless the GST incurred is not
recoverable from the taxation authority. In this case, it is recognised as part of the cost of 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 taxation authority is included with other receivables or 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 taxation authority, are presented as operating cash flows.
2. PRINCIPLES OF CONSOLIDATION
Subsidiaries
The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Avenira Limited
(“Company” or “Parent Entity”) as at 30 June 2022 and the results of all subsidiaries for the year then ended. Avenira
Limited and its subsidiaries together are referred to in this financial report as the Group or the consolidated entity.
Subsidiaries are all entities (including special purpose 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.
The Group re-assesses whether or not it controls an investee if facts and circumstances indicate that there are changes
to one or more of the three elements of control. Consolidation of a subsidiary begins when the Group obtains control over
the subsidiary and ceases when the Group loses control of the subsidiary. Assets, liabilities, income and expenses of a
subsidiary acquired or disposed of during the year are included in the consolidated financial statements from the date
the Group gains control until the date the Group ceases to control the subsidiary.
If the Group loses control over a subsidiary, it derecognises the related assets (including goodwill), liabilities, non-
controlling interest and other components of equity, while any resultant gain or loss is recognised in profit or loss. Any
investment retained is recognised at fair value.
The acquisition method of accounting is used to account for business combinations by the Group. Intercompany
transactions, balances and unrealised gains on transactions between Group companies 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 changed where necessary to ensure consistency with the policies adopted by the
Group.
Non-controlling interests in the results and equity of subsidiaries are shown separately in the consolidated statement of
comprehensive income, consolidated statement of changes in equity and consolidated statement of financial position
respectively.
Investments in subsidiaries are accounted for at cost in the individual financial statements of the Company.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, YEAR ENDED 30 JUNE 2022
41
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a) Fair Value of Assets and Liabilities
The Group measures some of its assets and liabilities at fair value on either a recurring or non-recurring basis, depending
on the requirements of the applicable Accounting Standard.
Fair value is the price the Group would receive to sell an asset or would have to pay to transfer a liability in an orderly (i.e.
unforced) transaction between independent, knowledgeable and willing market participants at the measurement date.
As fair value is a market-based measure, the closest equivalent observable market pricing information is used to determine
fair value. Adjustments to market values may be made having regard to the characteristics of the specific asset or liability.
The fair values of assets and liabilities that are not traded in an active market are determined using one or more valuation
techniques. These valuation techniques maximise, to the extent possible, the use of observable market data.
To the extent possible, market information is extracted from either the principal market for the asset or liability (i.e. the
market with the greatest volume and level of activity for the asset or liability) or, in the absence of such a market, the
most advantageous market available to the entity at the end of the reporting period (i.e. the market that maximises the
receipts from the sale of the asset or minimises the payments made to transfer the liability, after taking into account
transaction costs and transport costs).
For non-financial assets, the fair value measurement also takes into account a market participant’s ability to use the asset
in its highest and best use or to sell it to another market participant that would use the asset in its highest and best use.
The fair value of liabilities and the entity’s own equity instruments (excluding those related to share-based payment
arrangements) may be valued, where there is no observable market price in relation to the transfer of such financial
instruments, by reference to observable market information where such instruments are held as assets. Where this
information is not available, other valuation techniques are adopted and, where significant, are detailed in the respective
note to the financial statements.
VALUATION TECHNIQUES
In the absence of an active market for an identical asset or liability, the Group selects and uses one or more valuation
techniques to measure the fair value of the asset or liability. The Group selects a valuation technique that is appropriate in
the circumstances and for which sufficient data is available to measure fair value. The availability of sufficient and relevant
data primarily depends on the specific characteristics of the asset or liability being measured. The valuation techniques
selected by the Group are consistent with one or more of the following valuation approaches:
Market approach: valuation techniques that use prices and other relevant information generated by market transactions
for identical or similar assets or liabilities.
Income approach: valuation techniques that convert estimated future cash flows or income and expenses into a single
discounted present value.
Cost approach: valuation techniques that reflect the current replacement cost of an asset at its current service capacity.
Each valuation technique requires inputs that reflect the assumptions that buyers and sellers would use when pricing
the asset or liability, including assumptions about risks. When selecting a valuation technique, the Group gives priority
to those techniques that maximise the use of observable inputs and minimise the use of unobservable inputs. Inputs
that are developed using market data (such as publicly available information on actual transactions) and reflect the
assumptions that buyers and sellers would generally use when pricing the asset or liability are considered observable,
whereas inputs for which market data is not available and therefore are developed using the best information available
about such assumptions are considered unobservable.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, YEAR ENDED 30 JUNE 2022
42
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
FAIR VALUE HIERARCHY
AASB 13 requires the disclosure of fair value information by level of the fair value hierarchy, which categorises fair value
measurements into one of three possible levels based on the lowest level that an input that is significant to the
measurement can be categorised into as follows:
Level 1
Measurements based on quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity
can access at the measurement date.
Level 2
Measurements based on inputs other than quoted prices included in Level 1 that are observable for the asset or liability,
either directly or indirectly.
Level 3
Measurements based on unobservable inputs for the asset or liability.
The fair values of assets and liabilities that are not traded in an active market are determined using one or more valuation
techniques. These valuation techniques maximise, to the extent possible, the use of observable market data. If all
significant inputs required to measure fair value are observable, the asset or liability is included in Level 2. If one or
more significant inputs are not based on observable market data, the asset or liability is included in Level 3.
The Group would change the categorisation within the fair value hierarchy only in the following circumstances:
i.
If a market that was previously considered active (Level 1) became inactive (Level 2 or Level 3) or vice versa;
or
ii.
If significant inputs that were previously unobservable (Level 3) became observable (Level 2) or vice versa.
When a change in the categorisation occurs, the Group recognises transfers between levels of the fair value hierarchy
(i.e. transfers into and out of each level of the fair value hierarchy) on the date the event or change in circumstances
occurred.
(b) Foreign exchange transactions and balances
Foreign currency transactions are translated into the functional currency 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 year end exchange rates of monetary assets and liabilities denominated in foreign currencies
are recognised in profit or loss.
Translation differences on financial assets and liabilities carried at fair value are reported as part of the fair value gain
or loss. Translation differences on non-monetary financial assets and liabilities such as equities held at fair value through
profit or loss are recognised in profit or loss as part of the fair value gain or loss. Translation differences on non-
monetary financial assets such as equities classified as financial assets through other comprehensive income are
included in the fair value reserve in equity.
(c) New and revised AASB’s affecting amounts reported and/or disclosures in the financial statements
In the year ended 30 June 2022, the Directors have reviewed all of the new and revised Standards and Interpretations
issued by the AASB that are relevant to the Company and effective for the current annual reporting period. As a result
of this review, the Directors have determined that there is no material impact of the new and revised Standards and
Interpretations on the Company and, therefore, no material change is necessary to Group accounting policies.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, YEAR ENDED 30 JUNE 2022
43
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(d) New and revised Accounting Standards for Application in Future Periods
The Directors have also reviewed all of the new and revised Standards and Interpretations in issue not yet adopted for
the year ended 30 June 2022. As a result of this review the Directors have determined that there is no material impact
of the Standards and Interpretations in issue not yet adopted on the Company and, therefore, no change is necessary
to Group accounting policies.
(e) Deferred tax assets and deferred tax liabilities
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.
Deferred tax liabilities and assets are not recognised for temporary differences between the carrying amount and tax
bases of investments in controlled entities where the parent entity is able to control the timing of the reversal of the
temporary differences and it is probable that the differences will not reverse in the foreseeable future.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and
liabilities and when the deferred tax balances relate to the same taxation authority. Current tax assets and tax liabilities
are offset where the entity has a legally enforceable right to offset and intends either to settle on a net basis, or to
realise the asset and settle the liability simultaneously.
Current and deferred tax is recognised in profit or loss, except to the extent that it relates to items recognised in other
comprehensive income or directly in equity. In this case, the tax is also recognised in other comprehensive income or
directly in equity, respectively.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, YEAR ENDED 30 JUNE 2022
44
4. SEGMENT INFORMATION
Accounting Policy
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating
decision maker. The chief operating decision maker, who is responsible for allocating resources and assessing
performance of the operating segments, has been identified as the full Board of Directors.
(a) Description of segments
Management has determined the operating segments based on the reports reviewed by the Board of Directors that
are used to make strategic decisions.
The Board considers the business from both functional and geographic perspectives and has identified that there are
two reportable segments being:
•
exploration and development of Wonarah in the Northern Territory in Australia;
•
exploration and development of Jundee South in Western Australia; and
•
unallocated items comprise corporate administrative costs, interest revenue, finance costs, investments,
corporate plant and equipment and income tax assets and liabilities.
(b) Segment information provided to the Board
The following table presents revenue and profit for the Group’s operating segments for the reporting period.
WONARAH
(NORTHERN
TERRITORY)
JUNDEE SOUTH
(WESTERN
AUSTRALIA)
UNALLOCATED –
OTHER SEGMENTS
TOTAL
CONSOLIDATED
$
$
$
$
2022
Income
Interest income
4,689
-
2,335
7,024
Other income
-
-
3,155
3,155
Total segment income
4,689
-
5,490
10,179
Total revenue as per statement of
comprehensive income
10,179
Impairment of non-current assets
(676,173)
-
-
(617,790)
Salaries, administrative and other
expenses
(37,988)
-
(1,990,935)
(2,028,923)
Extinguishment of financial liabilities
-
-
(145,800)
(145,800)
Depreciation and amortisation
-
-
(34,492)
(34,492)
Segment net loss before tax
(709,472)
-
(2,165,737)
(2,875,209)
Tax benefit
-
-
-
-
Segment net loss after tax
(709,472)
-
(2,165,737)
(2,875,209)
Total net loss as per statement of
comprehensive income
(2,875,209)
Segment assets
Capitalised exploration and evaluation
expenditure
5,889,800
3,038,092
-
8,927,892
Property, plant and equipment
-
-
1,788
1,788
Other assets at balance date
1,492,531
-
1,984,969
3,477,500
Total segment assets
7,382,331
3,038,092
1,986,757
12,407,180
Segment liabilities
Other liabilities at balance date
2,106,747
-
3,964,239
6,070,986
Total segment liabilities
2,106,747
-
3,964,239
6,070,986
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, YEAR ENDED 30 JUNE 2022
45
WONARAH
(NORTHERN
TERRITORY)
JUNDEE SOUTH
(WESTERN
AUSTRALIA)
UNALLOCATED –
OTHER SEGMENTS
TOTAL
CONSOLIDATED
$
$
$
$
2021
Income
Interest income
9,420
-
8,666
18,086
Other income
10,000
-
940
10,940
Total segment income
19,420
-
9,606
29,026
Total revenue as per statement of
comprehensive income
29,026
Impairment of non-current assets
(92,924)
-
-
(92,924)
Salaries, administrative and other
expenses
(37,992)
-
(1,969,855)
(2,007,847)
Depreciation and amortisation
-
-
(34,214)
(34,214)
Net loss on disposal of fixed assets
-
-
-
-
Segment net loss before tax
(111,496)
-
(1,994,463)
(2,105,959)
Tax benefit
-
-
-
-
Segment net loss after tax
(111,496)
-
(1,994,463)
(2,105,959)
Total net loss as per statement of
comprehensive income
(2,105,959)
Segment assets
Capitalised exploration and evaluation
expenditure
5,889,800
1,621,457
-
7,511,257
Other assets at balance date
1,487,481
-
5,013,714
6,501,195
Total segment assets
7,377,281
1,621,457
5,013,714
14,012,452
Segment liabilities
Other liabilities at balance date
1,768,430
-
3,136,536
4,904,966
Total segment liabilities
1,768,430
-
3,136,536
4,904,966
5. INCOME
Accounting policies
Interest income is recognised on a time proportionate basis that takes into account the effective yield on the financial
assets.
2022
2021
$
$
Other income
Interest from financial institutions
7,024
18,086
Other income
3,155
10,940
10,179
29,026
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, YEAR ENDED 30 JUNE 2022
46
6. ADMINISTRATIVE AND EMPLOYEE BENEFITS EXPENSE
2022
2021
$
$
Loss before income tax includes the following administrative expenses
Consultants
110,785
347,445
Regulatory expenses
85,774
148,308
Accounting and legal
306,850
379,173
Travel expenses
39,879
30,740
Short term office lease expense
24,601
32,154
Other administrative expenses
82,467
130,069
Interest on borrowings expense
228,307
-
878,664
1,067,889
2022
2021
$
$
Loss before income tax includes the following employee benefit
expenses
Salaries and wages
371,678
287,436
Defined contribution superannuation expense
81,635
62,099
Regulatory taxes
17,520
22,352
Director fees
612,281
439,000
Medical and insurance
56,044
46,688
1,139,158
857,575
7. INCOME TAX
Accounting Policies
The income tax expense or benefit for the period is the tax payable on the current period’s taxable income based on
the applicable income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable
to temporary differences and to unused tax losses.
The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the end of
the reporting period in the countries where the Company’s subsidiaries and associated entities operate and generate
taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in which
applicable tax regulation is subject to interpretation. It establishes provisions where appropriate on the basis of amounts
expected to be paid to the tax authorities.
Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax
bases of assets and liabilities and their carrying amounts in the consolidated financial statements. However, the deferred
income tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a
business combination that at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred
income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the reporting
date and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability
is settled.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, YEAR ENDED 30 JUNE 2022
47
7. INCOME TAX (continued)
2022
2021
$
$
(a) Income tax expense/(benefit)
Current tax
-
-
Deferred tax
-
-
-
-
(b) Numerical reconciliation of income tax expense to prima facie tax payable
Loss from continuing operations before income tax expense
(2,875,209)
(2,105,959)
Loss from discontinued operations before income tax expense
-
-
Accounting loss before income tax
(2,875,209)
(2,105,959)
Prima facie tax benefit at the Australian tax rate of 25% (2021: 30%)
(718,802)
(631,788)
Tax effect of amounts which are not deductible/(taxable) in calculating taxable income:
Share based payments
1,834
23,376
Impairments
169,043
Other permanent differences
45,653
Unrealised foreign exchange gain/(loss)
107
5,849
Movements in other unrecognised temporary differences
(353,641)
(224,734)
Tax effect of current year tax losses and timing differences for which no
deferred tax asset has been recognised
855,806
827,297
Income tax benefit
-
-
(c) Tax affect relating to each component of other comprehensive income
Financial assets
-
145,930
-
145,930
(d) Deferred tax assets
Capital raising costs
47,541
173,250
Rehabilitation provision
511,859
530,424
Other provisions and accruals
129,877
101,294
Tax losses in Australia
28,413,604
35,098,926
Financial assets at FVOCI
-
145,930
29,102,881
36,049,824
Deferred tax assets not recognised
(26,870,908)
(33,787,055)
2,231,973
2,262,769
Offset against deferred tax liabilities
(2,231,973)
(2,262,769)
Net deferred tax assets
-
-
(e) Deferred tax liabilities
Capitalised exploration and evaluation costs and development costs
(2,231,973)
(2,253,377)
Financial assets at FVOCI
-
-
Other accruals
-
(9,392)
(2,231,973)
(2,262,769)
Offset against deferred tax assets
2,231,973
2,262,769
Net deferred tax liabilities
-
-
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, YEAR ENDED 30 JUNE 2022
48
7. INCOME TAX (continued)
DEFFERED TAX
Potential deferred tax assets attributable to tax losses and exploration expenditure carried forward have not been brought
to account at 30 June 2022 because the directors do not believe it is appropriate to regard realisation of the deferred tax
assets as probable at this point in time. These benefits will only be obtained if:
(i)
The Company derives future assessable income of a nature and of an amount sufficient to enable the benefit from
the deductions for the loss and exploration expenditure to be realised;
(ii)
The Company continues to comply with conditions for deductibility imposed by law; and
(iii) No changes in tax legislation adversely affect the Company in realising the benefit from the deductions for the loss
and exploration expenditure.
TAX CONSOLIDATION
Avenira Limited and its 100% owned Australian resident subsidiaries are part of a tax consolidated group. As a
consequence, all members of the tax consolidated group are taxed as a single entity. Avenira Limited is the head entity
of the tax consolidated group. Members of the tax consolidated group have entered into a tax sharing agreement that
provides for the allocation of income tax liabilities between the entities should the head entity default on its payment
obligations. No amounts have been recognised in the financial statements in respect of this agreement on the basis
that the possibility of default is remote.
8. CASH AND CASH EQUIVALENTS
Accounting Policies
For statement of cash flows presentation purposes, cash and cash equivalents includes 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 insignificant risk of changes in value, and
bank overdrafts.
2022
2021
$
$
Cash at bank and in hand (continuing operations)
1,009,638
3,123,043
Cash and cash equivalents
1,009,638
3,123,043
Cash at bank and in hand earns interest at floating rates based on daily bank deposit rates.
Short term deposits are made for varying periods of between one day and three months depending on the immediate
cash requirements of the Group and earn interest at the respective short-term deposit rates. Refer to Note 18 for
additional details on the impact of interest rates on cash and cash equivalents for the period.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, YEAR ENDED 30 JUNE 2022
49
9. TRADE AND OTHER RECEIVABLES
Accounting Policies
Recognition and measurement
Trade receivables are initially recognised at fair value and subsequently at amortised cost less a provision for any
expected credit losses. Trade receivables are due for settlement no more than 30 days from the date of recognition.
Impairment
The Group recognises an allowance for expected credit losses (ECLs) for all debt instruments not held at fair value
through profit or loss. ECLs are based on the difference between the contractual cash flows due in accordance with the
contract and all the cash flows that the Group expects to receive, discounted at the original effective interest rate. The
expected cash flows will include cash flows from the sale of collateral held or other credit enhancements that are integral
to the contractual terms.
For trade receivables and other receivables, the Group applies a simplified approach in calculating ECLs. Therefore, the
Group does not track changes in credit risk, but instead recognises a loss allowance based on lifetime ECLs at each
reporting date. The Group concluded that the lifetime ECL for these assets would be negligible and therefore no
additional loss allowance was required.
Current
2022
2021
$
$
Trade and other receivables(i)
3,275
2,989
Government taxes receivable(ii)
38,343
48,429
Prepayments (iii)
69,361
48,124
Security deposits
29,667
29,667
140,646
129,209
(i) Trade and other receivables are generally due for settlement within 30 days and therefore classified as current.
(ii) Government taxes receivable in 2022 relates to GST receivable in Australia.
(iii) Prepayments include payments made in relation to D&O insurance paid for the period 01/07/2022 – 30/03/2023.
The carrying amounts disclosed above represent their fair value.
10. OTHER NON-CURRENT ASSETS
Non-Current
2022
2021
$
$
Security deposits (i)
1,481,600
1,481,600
1,481,600
1,481,600
(i) Security Deposit for Wonarah tenements in the Northern Territory
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, YEAR ENDED 30 JUNE 2022
50
11. LEASES
Accounting Policies
(i)
Right-of-use assets
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 subject to impairment.
(ii)
Lease liabilities
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.
(iii)
Leases - Estimating the incremental borrowing rate
When the Group cannot readily determine the interest rate implicit in the lease, it uses its incremental borrowing rate
(IBR) to measure lease liabilities. The IBR is the rate of interest that the Group would have to pay to borrow over a similar
term, and with a similar security, the funds necessary to obtain an asset of a similar value to the right-of-use asset in a
similar economic environment. The IBR therefore reflects what the Group ‘would have to pay’, which requires estimation
when no observable rates are available (such as for subsidiaries that do not enter into financing transactions) or when
they need to be adjusted to reflect the terms and conditions of the lease (for example, when leases are not in the
subsidiary’s functional currency). The Group estimates the IBR using observable inputs (such as market interest rates)
when available and is required to make certain entity-specific estimates (such as the subsidiary’s stand-alone credit
rating).
(iv)
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., 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 lease of
low-value assets 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 expense on a straight-line basis over the lease term.
Right-to-use assets recognised and movements during the year
2022
$
2021
$
Opening net carrying amount
48,800
84,348
Additions
-
-
Depreciation expense
(34,480)
(35,548)
Transfer to discontinued operations
-
-
Net carrying amount
14,320
48,800
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, YEAR ENDED 30 JUNE 2022
51
11. LEASES (continued)
Lease liabilities and movements during the year
2022
$
2021
$
Opening net carrying amount
54,889
91,802
Additions
-
-
Interest expense
2,207
4,515
Payments
(40,000)
(40,000)
Adjustments to prior period
(684)
(1,428)
Transfer to discontinued operations
-
-
Closing net carrying amount
16,412
54,889
Current
16,412
38,148
Non-current
-
16,741
12. CAPITALISED EXPLORATION AND EVALUATION EXPENDITURE
Accounting Policies – Capitalised Exploration and Evaluation Expenditure
Exploration and evaluation costs for each area of interest that has progressed to pre-feasibility are accumulated and
carried forward where right of tenure of the area of interest is current and they are expected to be recouped through sale
or successful development and exploitation of the area of interest or, where exploration and evaluation activities in the
area of interest have not at the end of the reporting period reached a stage that permits reasonable assessment of the
existence of economically recoverable reserves, and activates and significant operations in, or in relation to, the area of
interest are continuing.
When an area of interest is abandoned or the directors decide that it is not commercial, any accumulated costs in respect to
that area are written off in the financial period the decision is made. Each area of interest is also reviewed at the end of
each accounting period and accumulated costs written off to the extent that they will not be recoverable in the future.
2022
2021
$
$
Reconciliation of movements of exploration and evaluation costs in respect of mining areas of interest
Opening net carrying amount
7,511,257
6,344,326
Capitalised exploration and evaluation costs
1,755,073
1,231,448
Increase to rehabilitation provision
337,735
28,407
Impairment of exploration and evaluation expenditure
(i)
(676,173)
(92,924)
Closing net carrying amount
8,927,892
7,511,257
2022
2021
$
$
Closing net carrying amount represented by the following projects
Jundee South Project
3,038,092
1,621,457
Wonarah Phosphate Project
5,889,800
5,889,800
Closing net carrying amount
8,927,892
7,511,257
The ultimate recoupment of costs carried forward for exploration and evaluation is dependent on the successful
development and commercial exploitation or sale of the respective mining areas.
(i) Impairment recognised in respect of the Wonarah Project. Refer to the key estimates and assumptions section below for details regarding the
Group’s assessment of the carrying value of recognised exploration and evaluation expenditure.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, YEAR ENDED 30 JUNE 2022
52
12. CAPITALISED EXPLORATION AND EVALUATION EXPENDITURE (continued)
Key estimates and assumptions
The application of the Group’s accounting policy requires management to make certain estimates and assumptions as to
future events and circumstances, in particular, the assessment of whether economic quantities of reserves will be found.
Any such estimates and assumptions may change as new information becomes available, which may require adjustments
to the carrying value of assets.
The Group assesses impairment at each reporting date by evaluating conditions specific to the Group that may lead to
impairment of assets. Where an impairment trigger exists, the recoverable amount of the asset is determined.
SRK Consulting conducted an update to the valuation of the Wonarah Project as at 30 June 2021. In SRK’s opinion, the
valuation of the Wonarah Project has not materially changed since the effective date of the 2019 SRK Report.
The 2019 report revealed fair values for the Wonarah Project ranging from $6,010,000 to $16,020,000, based on a range
of resource multiples derived from recent transactions and enterprise values of market participants with defined
phosphate mineral resources (level 3 in the fair value hierarchy).
The directors consider that the low end of the independent expert’s range is most representative of the fair value less
costs of disposal of the Wonarah Project. As a result, during the reporting period an amount of $673,173 (30 June 2021:
$92,924) was impaired and recognised in the Statement of Profit or Loss and Other Comprehensive Income. The
recoverable amount is calculated as $5,889,800 after allowing for estimated costs of disposal.
13. TRADE AND OTHER PAYABLES
Accounting Policies
Recognition and measurement
Liabilities for trade creditors and other amounts are carried at amortised cost, which is the amount initially recognised,
minus repayments whether or not billed to the consolidated entity.
These amounts represent liabilities for goods and services provided to the Group prior to the end of the financial year
which are unpaid. The amounts are unsecured, non-interest bearing and are paid on normal commercial terms.
2022
2021
$
$
Trade payables(i)
299,722
228,086
Other payables and accruals
379,957
299,200
679,679
527,286
(i)
Trade payables are non-interest bearing and generally on 30-day terms.
The carrying amounts disclosed above represent their fair value.
14. PROVISIONS
Accounting Policies
(i)
Wages and salaries and annual leave
Liabilities for wages and salaries, including non-monetary benefits, and annual leave expected to be settled within 12
months of the reporting date are recognised in provisions in respect of employees’ services up to the reporting date and
are measured at the amounts expected to be paid when the liabilities are settled.
(ii)
Long service leave
The Group does not expect its long service leave benefits to be settled wholly within 12 months of each reporting date.
The Group recognised a liability for long service leave measured as 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 wages and salary levels, experience of employee departures, and periods of
service. Expected future payments are discounted using market yields at the reporting date on high quality corporate
bonds with terms to maturity and currencies that match, as closely as possible the estimated future cash outflows.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, YEAR ENDED 30 JUNE 2022
53
14. PROVISIONS (continued)
(iii)
Mine rehabilitation and restoration
The Group records the present value of the estimated cost of legal and constructive obligations to restore operating
locations in the period in which the obligation arises. The nature of restoration activities includes the dismantling and
removing of structures, rehabilitating mines, dismantling operating facilities, closure of plant and waste sites and
restoration, reclamation and revegetation of affected areas.
Typically, the obligation arises when the asset is installed or the ground/environment is disturbed at the production location.
When the liability is initially recorded, the estimated cost is recognised by increasing the carrying amount of the related
mining asset. Over time, the liability is increased for the change in the present value based on a discount rate appropriate
to the market assessments and the risks inherent in the liability. Additional disturbances or changes in rehabilitation costs
will be recognised as additions or changes to the corresponding asset and rehabilitation liability when incurred. The
unwinding of the effect of discounting the provision is recorded as a finance cost in the statement of comprehensive
income. The recognized carrying amount is depreciated over the useful life of the related asset.
Costs incurred that relate to an existing condition caused by past operations, and do not have future economic benefit, are
expensed as incurred.
Current
2022
2021
$
$
Employment benefits
66,122
43,404
66,122
43,404
Non-Current
2022
2021
$
$
Mine rehabilitation and restoration(i)
2,105,817
1,768,081
2,105,817
1,768,081
Movements in mine rehabilitation and restoration provision
Opening net carrying amount
1,768,081
1,739,674
(Decrease)/increase from change in discount and inflation rate
337,736
28,407
Closing net carrying amount
2,105,817
1,768,081
(i) Provision for future removal and restoration costs are recognised where there is a present obligation as a result of exploration, development, production,
transportation or storage activities having been undertaken, and it is probable that an outflow of economic benefits will be required to settle the obligation.
The provision includes the restoration costs based on the estimated future costs as assessed independently by the Northern Territory Government
Department of Regional Development, Primary Industry, Fisheries and Resources. The estimated future obligations include the costs of removing plant,
abandoning mine site and restoring the affected areas.
Key estimates and assumptions
The Group assesses its mine rehabilitation provision half yearly in accordance with the above accounting policy. Significant
judgment is required in determining the provision for mine rehabilitation as there are many transactions and other factors
that will affect the ultimate liability payable to rehabilitate the mine sites. Factors that will affect this liability include future
disturbances caused by further development, changes in technology, changes in regulations, price increases and changes
in discount rates. When these factors change, or become known in the future, such differences will impact the mine
rehabilitation provision in the period in which they change or become known. As at 30 June 2022 the rehabilitation
obligation has a carrying value of $2,105,817 (2021: $1,768,081) for the Wonarah Phosphate Project.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, YEAR ENDED 30 JUNE 2022
54
15. LOANS AND BORROWINGS
Accounting Policies
Borrowings are presented as current liabilities unless the Group has an unconditional right to defer settlement for at least
12 months after the reporting date.
Borrowings are initially recognised at fair value (net of transaction costs) and subsequently carried at amortised cost. Any
differences between the proceeds (net of transaction costs) and the redemption value is recognised in profit or loss over
the period of the borrowings using the effective interest method.
Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a
substantial period of time to get ready for its intended use or sale are capitalised as part of the cost of the asset. All other
borrowing costs are expensed in the period in which they occur. Borrowing costs consist of interest and other costs that
an entity incurs in connection with the borrowing of funds.
Non-Current
INTEREST
RATE
2022
2021
%
$ (1)
$
Loan Facility - secured
8%
3,202,956
2,480,000
Total non-current loans and borrowings
3,202,956
2,480,000
(1) The Loan balance as at 30 June 2022 includes capitalised interest of $228,307
Loan Facility
a)
In June 2020 the Company received shareholder approval to enter into a $3 million secured loan facility with Au
Xingao Investment Pty Ltd, a substantial shareholder of the Company.
The loan was drawn down to $2,974,649 at the end of the 2022 financial year.
The material terms of the Loan Facility are as follows:
Loan Amount
$3,000,000.
Interest
8% per annum. Accrued interest will be capitalised (if not paid) every 6 months.
Security
The Loan Facility will be secured by a mining mortgage over the Company's
Wonarah Project and a general security deed over specified listed securities
held by the Company.
Termination and repayment
The Company must repay the Loan Amount and all other amounts outstanding
(including all capitalised interest and accrued uncapitalised interest) after 3
years form the date of signing the loan agreement ('Repayment Date'), unless
the Lender elects to convert earlier.
Conversion
After 18 months, the Lender may elect to convert the Loan Amount into
ordinary shares in the Company based on the 30 day VWAP of the Company's
shares prior to the conversion date.
Prepayment
The Company may prepay the Loan Amount at any time prior to the
Repayment Date.
b)
During the year the Company entered into a loan agreement for $351,000. The Company then entered into a
Termination Deed, converting the loan into 27,000,000 fully paid ordinary shares, resulting in a loss on
extinguishment of loan of $145,800.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, YEAR ENDED 30 JUNE 2022
55
16. ISSUED CAPITAL
Accounting Policies
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. Incremental costs directly attributable to the issue of new shares or options for the acquisition
of a business are not included in the cost of the acquisition as part of the purchase consideration.
NUMBER OF OPTIONS
2022
2021
(c) Movements in unlisted options on issue
Beginning of the financial year
60,000,000
48,000,000
Exercised during the financial year
(719)
-
Issued during the financial year
- 2.5 cent options, 7 September 2023 (1)
-
6,000,000
- 3.5 cent options, 7 September 2023 (1)
-
6,000,000
- 2 cent options, 21 September 2022 (2)
1,500,000
- 3 cent options, 30 June 2024 (2)
1,500,000
- 2.2 cent options, 30 April 2024 (3)
37,077,000
End of the financial year
100,076,281
60,000,000
(1) Options issued to Taylor Collison Sharebrokers and Investment Advisers subsequent to the shareholder approval. The Group recognised $77,919
of share-based payment expense in the statement of profit or loss.
(2) Options issued. The Group recognised $7,334 of share based payment expense in the statement of profit or loss.
(3) Options issued pursuant to the Entitlements Issue dated 28 March 2022.
2022
2021
NOTES
NUMBER OF
SHARES
$
NUMBER OF
SHARES
$
(a) Share capital
Ordinary shares fully paid
16(b),
16(d)
1,001,084,420
142,239,848
862,852,818
140,516,513
Total share capital
1,001,084,420
142,239,848
862,852,818
140,516,513
(b) Movements in ordinary share capital
Beginning of the financial year
862,852,818
140,516,513
440,754,926
137,337,162
Transactions during the year:
- Issue of shares @ $0.008
-
-
66,113,238
528,906
- Issue of shares @ $0.008
-
-
74,966,928
599,735
- Issue of shares @ $0.008
-
-
69,850,964
558,808
- Issue of shares @ $0.008
-
-
136,878,660
1,095,029
- Issue of shares @ $0.008
-
-
48,900,070
391,201
- Issue of shares @ $0.008
-
-
25,388,032
203,104
- Issue of shares @ $0.0184
27,000,000
496,800
-
-
- Issue of shares @ $0.013
111,231,602
1,446,011
-
-
-Conversion of options @ $0.022
719
16
-
-
Less transaction costs
-
(73,692)
-
(197,432)
End of the financial year
1,001,085,139
142,385,648
862,852,818
140,516,513
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, YEAR ENDED 30 JUNE 2022
56
16. ISSUED CAPITAL (continued)
(d) Ordinary shares
Ordinary shares entitle the holder to participate in dividends and the proceeds on winding up of the Company in proportion
to the number of and amounts paid on the shares held.
On a show of hands every holder of ordinary shares present at a meeting in person or by proxy, is entitled to one vote,
and upon a poll each share is entitled to one vote.
Ordinary shares have no par value and the Company does not have a limited amount of authorised capital.
(e) Capital risk management
The Group’s objectives when managing capital are to safeguard their ability to continue as a going concern, so that they
may continue to provide returns for shareholders and benefits for other stakeholders. There has been no change in the
strategy adopted by management to control the capital of the Group since the prior year.
Due to the nature of the Group’s activities, being mineral exploration, the Group does not have ready access to credit
facilities, with the primary source of funding being equity raisings. Therefore, the focus of the Group’s capital risk
management is the current working capital position against the requirements of the Group to support exploration
programmes, development and production start-up phases of its exploration projects and corporate overheads. The
Group’s strategy is to ensure appropriate liquidity is maintained to meet anticipated operating requirements, with a view
to initiating appropriate funding as required.
The working capital position of the Group at the end of the year is as follows:
2022
2021
$
$
Cash and cash equivalents
1,009,638
3,123,043
Trade and other receivables
140,646
129,209
Trade and other payables
(679,679)
(527,286)
Lease Liability
(16,412)
(38,148)
Current provisions
(66,122)
(43,404)
Amounts received in advance from sale of financial assets
-
(31,306)
Working capital position
388,071
2,612,108
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, YEAR ENDED 30 JUNE 2022
57
17. RESERVES AND ACCUMULATED LOSSES
2022
2021
$
$
(a) Reserves
Financial assets at fair value through OCI
(1,358,620)
486,432
Foreign currency translation
128,765
128,765
Share-based payments
17,755,182
17,675,348
Total reserves
16,525,327
18,290,545
2022
2021
$
$
Movements:
Fair Value Reserve of Financial Assets at FVOCI
Balance at beginning of year
486,432
67,882
Revaluation
(1,845,052)
418,550
Balance at end of year
(1,358,620)
486,432
Foreign currency translation reserve
Balance at beginning of year
128,765
128,765
Recycled to the profit and loss on derecognition of controlled entity
-
-
Currency translation differences arising during the year
-
-
Balance at end of year
128,765
128,765
Share-based payments reserve
Balance at beginning of year
17,675,348
17,597,429
Performance rights and share rights
-
-
Other share-based payments(i)
79,834
77,919
Share rights converted to ordinary shares
-
-
Balance at end of year
17,755,182
17,675,348
Non-controlling interest reserve
Balance at beginning of year
-
7,465,464
Parent equity adjustment for NCI consideration
-
(7,465,464)
Balance at end of year
-
-
(i)
Refer to Note 28 Share Based Payments for further details.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, YEAR ENDED 30 JUNE 2022
58
17.
RESERVES AND ACCUMULATED LOSSES (continued)
2022
2021
$
$
(b) Accumulated losses
Balance at beginning of year
(149,699,572)
(155,059,077)
Net loss for the year attributable to owners of Avenira Limited
(2,875,209)
(2,105,959)
NCI reserve transfer
-
7,465,464
Balance at end of year
(152,574,781)
(149,699,572)
(c) Nature and purpose of reserves
(i) Fair Value Reserve of Financial Assets at FVOCI
Changes in the fair value of investments, such as equities classified as Fair value reserve of financial assets at FVOCI,
are recognised in other comprehensive income and accumulated in a separate reserve within equity. Amounts are
reclassified to profit or loss when the associated assets are sold or impaired.
(ii) Foreign currency translation reserve
The foreign currency translation reserve comprises all foreign exchange differences arising from the translation of
foreign operations where their functional currency is different to the presentation currency of the reporting entity. The
reserve is recognised in profit and loss when the net assets of foreign controlled entities are disposed of.
(iii) Share-based payments reserve
The share-based payments reserve is used to recognise the fair value of options, contingent share rights and
performance rights granted.
(iv) Non-controlling interest reserve
The non-controlling interest’s reserve records the difference between the fair value of the amount by which the non-
controlling interest was adjusted to record their initial relative interest and the consideration paid.
18.
FINANCIAL RISK MANAGEMENT
Accounting Policies
Financial Assets
The Group classifies its financial assets in the following categories: at fair value through profit or loss (FVTPL), financial
assets at amortised cost, or fair value through other comprehensive income (FVOCI). The classification is based on two
criteria: the Group’s business model for managing the assets; and whether the instruments’ contractual cash flows
represent ‘solely payments of principal and interest’ on the principal amount outstanding (the ‘SPPI criterion’). The SPPI
test is applied to the entire financial asset, even if it contains an embedded derivative. Consequently, a derivative
embedded in a debt instrument is not accounted for separately.
(i) Trade and other receivables
Trade receivables are initially recognised at fair value and subsequently at amortised cost less a provision for any
expected credit losses. Trade receivables are due for settlement no more than 30 days from the date of recognition.
(ii) Financial assets measured at fair value through other comprehensive income
These financial assets consist of investments in ordinary shares, comprising principally of marketable equity securities.
Investments are initially recognised at fair value plus transaction costs. Unrealised gains and losses arising from changes
in the fair value of these investments are recognised in equity in the financial assets revaluation reserve. Amounts
recognised are not recycled to the statement of comprehensive income in future periods.
The fair value of the listed securities are based on quoted market prices and accordingly is a Level 1 measurement basis
on the fair value hierarchy.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, YEAR ENDED 30 JUNE 2022
59
18.
FINANCIAL RISK MANAGEMENT (continued)
Impairment of financial assets
Expected credit losses are recognised in the statement of profit and loss and other comprehensive income on financial
assets measured at amortised cost.
Financial Liabilities
The Group classifies its financial liabilities in the following categories: financial liabilities at amortised cost.
(i) Payables
This category generally applies to trade and other payables. Liabilities for trade creditors and other amounts are carried
at amortised cost which is the amount initially recognised. Minus repayments whether or not billed to the Group. Payables
are non-interest bearing and generally settled on 30-90 day terms. Due to the short term nature of these payables, their
carrying value is assumed to approximate their fair value. For more information refer to Note 13.
(ii) Loans and borrowings
This category generally applies to interest-bearing loans and borrowings. All loans and borrowings are initially recognised
at fair value less transaction costs and subsequently at amortised cost. Any difference between the proceeds received
and the redemption amount is recognised in the income statement over the period of the borrowings using the effective
interest method. For more information refer to Note 15.
FINANCIAL RISK MANAGEMENT POLICIES
The Group’s principal financial liabilities, other than derivatives, comprise loans and borrowings, and trade and other
payables. The main purpose of these financial liabilities is to finance the Group’s operations. The Group’s principal
financial assets include trade receivables, and cash and short-term deposits that derive directly from its operations. The
Group also holds investments in debt and equity instruments and enters into derivative transactions.
The Group is exposed to market risk, credit risk and liquidity risk. The Group’s senior management oversees the
management of these risks. The Group’s senior management is supported by a financial risk committee that advises on
financial risks and the appropriate financial risk governance framework for the Group. The financial risk committee
provides assurance to the Group’s senior management that the Group’s financial risk activities are governed by
appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with
the Group’s policies and risk objectives. All derivative activities for risk management purposes are carried out by specialist
teams that have the appropriate skills, experience and supervision. It is the Group’s policy that no trading in derivatives
for speculative purposes may be undertaken. The Board of Directors reviews and agrees policies for managing each of
these risks, which are summarised below.
Financial instruments
The Group holds the following financial instruments:
2022
2021
$
$
Financial assets
Cash and cash equivalents
1,009,638
3,123,043
Trade and other receivables
140,646
129,209
Other non-current receivables
1,481,600
1,481,600
Fair value reserve of financial assets at FVOCI
- Listed investments
746,296
1,633,543
- Unlisted investments
85,000
85,000
3,463,180
6,452,395
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, YEAR ENDED 30 JUNE 2022
60
18.
FINANCIAL RISK MANAGEMENT (continued)
2022
2021
$
$
Financial liabilities
Trade and other payables
679,679
527,286
Lease liabilities - current
16,412
38,148
Lease liabilities – non-current
-
16,741
Loans and borrowings
3,202,956
2,480,000
3,899,047
3,062,175
(a) Market risk
Market risk arises from Avenira’s exposure to interest bearing financial assets and foreign currency financial instruments.
It is a risk that the fair value of future cash flows of a financial instruments will fluctuate because of changes in foreign
exchange rates (currency risk), interest rates (interest rate risk) and share prices (price risk). The Group has determined
the impact of reasonably possible movements in foreign exchange and share prices is not material.
(i)
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. As at and during the year ended 30 June 2022, the Group had interest-bearing assets in the form of
cash and cash equivalents. As such the Group’s income and operating cash flows are somewhat exposed to movements in
market interest rates due to the movements in variable interest rates on cash and cash equivalents. The Group’s does not
have exposure to interest rate risk arising from its financial liabilities.
The Group’s policy is to monitor the interest rate yield curve out to six months to ensure a balance is maintained between
the liquidity of cash assets and the interest rate return. At 30 June 2022, the entire balance of cash and cash equivalents
for the Group of $1,009,638 (2021: $3,123,043) is subject to interest rate risk. The proportional mix of floating interest rates
and fixed rates, to a maximum of six months, fluctuate during the year depending on current working capital requirements.
(b) Credit risk
Credit risk is the risk that a counterparty will not meet its obligations under a financial instrument or customer contract, leading
to a financial loss. The Group is exposed to credit risk from its operating activities (primarily trade receivables) and from its
financing activities, including deposits with banks and financial institutions, foreign exchange transactions and other financial
instruments
Credit risk related to balances with banks and other financial institutions is managed by investing surplus funds in financial
institutions that maintain a high credit rating. The maximum exposure to credit risk at the reporting date is the carrying amount
of the assets as summarised below, none of which are impaired or past due.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, YEAR ENDED 30 JUNE 2022
61
18.
FINANCIAL RISK MANAGEMENT (continued)
2022
2021
$
$
Financial assets
Cash and cash equivalents
1,009,638
3,123,043
Trade and other receivables
140,646
129,209
Other non-current receivables
1,481,600
1,481,600
2,631,884
4,733,852
The credit quality of financial assets that are neither past due nor impaired can be assessed by reference to external credit
ratings (if available) or to historical information about counterparty default rates.
2022
2021
$
$
Cash at bank and short-term bank deposits
Held with Australian banks and financial institutions
AA3 rated
1,009,638
3,123,043
1,009,638
3,123,043
Trade and other receivables
Held with Australian banks and financial institutions
AA- rated
-
-
AA3 rated
29,667
29,667
Counterparties with external credit ratings
-
-
Counterparties without external credit ratings
Group 1
110,979
99,542
Group 2
-
-
140,646
129,209
Other non-current receivables
Held with Australian banks and financial institutions
AA- rated
1,481,600
1,481,600
1,481,600
1,481,600
(c) Liquidity risk
The Group manages liquidity risk by continuously monitoring forecast and actual cash flows and ensuring sufficient cash
and/or funding facilities are available to meet the current and future commitments of the Group. The Board of Directors
constantly monitors the state of equity markets in conjunction with the Group’s current and future funding requirements, with
a view to initiating capital raisings as required.
The financial liabilities of the Group consist of trade and other payables and lease liabilities as disclosed in the statement of
financial position. All trade and other payables are non-interest bearing and due within 12 months of the reporting date.
The following table details the Group’s remaining contractual maturity for its non-derivative financial liabilities with agreed
repayment periods.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, YEAR ENDED 30 JUNE 2022
62
18.
FINANCIAL RISK MANAGEMENT (continued)
LESS THAN
1 MONTH
1-3
MONTHS
3 MONTHS -
1 YEAR
1-5
YEARS
5+ YEARS
TOTAL
$
$
$
$
$
$
Contractual maturities of financial liabilities
2022
Trade and other payables
299,722
379,957
-
-
-
679,679
Lease Liabilities
-
10,201
6,717
-
-
16,918
Loans and borrowings
-
-
-
3,202,956
-
3,202,956
299,722
390,158
6,717
3,202,956
-
3,899,553
2021
Trade and other payables
228,086
299,200
-
-
-
527,286
Lease Liabilities
-
10,796
31,986
17,259
-
60,041
Loans and borrowings
-
-
-
2,480,000
-
2,480,000
228,086
309,996
31,986
2,497,259
-
3,067,327
(d) Net fair value
Fair value estimation
The fair value of financial assets and financial liabilities held by the Group must be estimated for recognition and
measurement or for disclosure purposes. All financial assets and financial liabilities of the Group at the balance date are
recorded at amounts approximating their fair value.
The fair value of financial instruments traded in active markets is based on quoted market prices at the reporting date. The
quoted market price used for financial assets held by the Group is the current bid price.
The carrying value less impairment provision of trade receivables and payables are assumed to approximate their fair
values due to their short-term nature.
The totals for each category of financial instruments, other than those with carrying amounts which are reasonable
approximations of fair value, are set out below:
CARRYING AMOUNT
FAIR VALUE
2022
2021
2022
2021
$
$
$
$
Financial assets
Fair value of financial assets through OCI
831,296
1,718,543
831,296
1,718,543
Total financial assets
831,296
1,718,543
831,296
1,718,543
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, YEAR ENDED 30 JUNE 2022
63
18. FINANCIAL RISK MANAGEMENT (continued)
Financial instruments measured at fair value
The financial instruments recognised at fair value in the statement of financial position have been analysed and classified
using a fair value hierarchy reflecting the significance of the inputs used in the making the measurements. The fair value
hierarchy consists of the following levels:
•
quoted prices in active markets for identical assets or liabilities (Level 1).
•
inputs other than quoted process included within Level 1 that are observable for the asset or liability, either directly
(as prices) or indirectly (derived from prices) (Level 2).
•
inputs for the asset or liability that are not based on observable market data (unobservable inputs) (Level 3).
LEVEL 1
LEVEL 2
LEVEL 3
TOTAL
$
$
$
$
2022
Financial assets
Fair value of financial assets through OCI –
listed
746,296
-
-
746,296
Fair value of financial assets through OCI–
unlisted
-
-
85,000
85,000
746,296
-
85,000
831,296
2021
Financial assets
Fair value of financial assets through OCI –
listed
1,633,543
-
-
1,633,543
Fair value of financial assets through OCI–
unlisted
-
-
85,000
85,000
1,633,543
-
85,000
1,718,543
(e) Capital risk management
For the purposes of the Group’s capital management, capital includes issued capital and all other equity reserves attributable
to the equity holders of the parent, which at 30 June 2022 was $6,336,194 (30 June 2021: $9,107,486). The primary
objective of the Group’s capital management is to maximise the shareholder value.
Key estimates and assumptions
As described in the accounting policy above, the Group uses valuation techniques that include inputs that are not based on
observable market data to estimate the fair value of certain types of financial instruments. Key assumptions used in the
determination of the fair value of financial instruments, as well as the detailed sensitivity analysis for these assumptions are
set out above.
The directors believe that the chosen valuation techniques and assumptions used are appropriate in determining the fair
value of financial instruments.
The Group assesses at each reporting date whether there is objective evidence that an investment or a group of investments
is impaired. In the case of equity investments classified as FVOCI, objective evidence would include a significant or
prolonged decline in the fair value of the investment below its cost. The determination of what is “significant” or “prolonged”
requires judgement. “Significant” is evaluated against the original cost of the investment and “prolonged” against the period
in which the fair value has been below its original cost.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, YEAR ENDED 30 JUNE 2022
64
19. REMUNERATION OF AUDITORS
During the year the following fees were paid or payable for services provided by the auditor of the parent entity, its related
practices and non-related audit firms:
The auditor of Avenira Limited is Hall Chadwick WA Audit (2021: Hall Chadwick WA Audit).
Auditor remuneration
2022
2021
$
$
Fees to Hall Chadwick WA
Auditing the statutory financial report of the parent covering the group
and any controlled entities
25,966
33,552
Assurance services that are required by legislation to be provided by
the auditor
-
-
Other Assurance and agreed-upon-procedure services under other
legislation or contractual arrangements where there is discretion as to
whether the service is provided by the auditor or another firm
-
-
Other Services
Tax Compliance
3,667
-
Total Auditor Remuneration
29,633
33,552
From time to time the Group may decide to employ the external auditor on assignments additional to their statutory audit
duties where the auditor’s expertise and experience with the Group is important.
The Board has considered the position and is satisfied that the provision of non-audit services is compatible with the general
standard of independence imposed by the Corporations Act 2001.The nature of services provided to the Group during the
period by Hall Chadwick and other practices do not compromise the general principles relating to auditor independence
because they relate to tax advice in relation to domestic and international compliance issues, and due diligence services
which involved the provision of assurances arising from their engagement.
20. CONTINGENCIES
In relation to tenement acquisition agreements entered into by the Group, the following additional cash may be received
dependent on future events:
TinOne Resources Corporation Royalty Deed
The parent entity will receive a royalty on a quarterly basis on all product sold, removed or otherwise disposed from specific
tenements held by TinOne Resources Corporation. The royalty is calculated at 1.5% of the net smelter return and the total
amount receivable is capped at $5,000,000.
The Directors are of the opinion that it is not practicable to estimate the financial effect of the royalty at the date of this report.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, YEAR ENDED 30 JUNE 2022
65
21. COMMITMENTS
The Group has certain commitments to meet minimum expenditure requirements on the mineral exploration assets for the
Wonarah project and Jundee South project areas that it has an interest in. Outstanding exploration commitments are as
follows:
2022
2021
$
$
(a) Exploration commitments
Within one year
494,894
357,884
Later than one year but no later than five years
1,614,904
983,562
Later than five years
-
-
2,109,798
1,341,446
The Group has an office lease contract as at 30 June 2022. The future lease payments for this non-cancellable lease
contract is $16,665 (2021: $40,465), later than one year but no later than five is NIL (2021: $17,000).
22. DIVIDENDS
No dividends were paid during the financial year. No recommendation for payment of dividends has been made.
23. RELATED PARTY TRANSACTIONS
(a)
Parent entity
The ultimate parent entity within the Group is Avenira Limited. The consolidated entity has a related party relationship with its
subsidiaries (see Note 24) and with its key management personnel.
(b)
Subsidiaries
Interests in subsidiaries are set out in Note 24.
(c)
Compensation of key management personnel
2022
2021
$
$
Short-term benefits
668,325
485,688
Post-employment benefits
53,239
37,430
721,564
523,118
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, YEAR ENDED 30 JUNE 2022
66
24. SUBSIDIARIES
Accounting policies
The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in accordance
with the accounting policy described in Note 2:
SUBSIDIARIES
COUNTRY OF
INCORPORATION
CLASS OF
SHARES
EQUITY HOLDING(i)
2022
2021
%
%
Minemakers Australia Pty Ltd
Australia
Ordinary
100
100
Bonaparte Diamond Mines Pty Ltd
Australia
Ordinary
100
100
Avenira Gold Pty Ltd
Australia
Ordinary
100
100
Avenira Holdings LLC (ii)
USA
Ordinary
100
100
(i) The proportion of ownership interest is equal to the proportion of voting power held.
(ii) The company’s equity represented by an initial capital contribution by Avenira as the sole member.
25. EVENTS OCCURING AFTER THE BALANCE DATE
Following the end of the financial year, the Company successfully undertook a placement to raise $2.1 million.
On 21 September 2022, the Company announced it had signed a non-binding MOU in relation to the Wonarah Project with
global LFP cathode manufacturer, Advanced Lithium Electrochemistry Ltd (Aleees) and the Northern Territory Government.
On 26 September 2022, the Company announced it had signed signed a non-binding MOU with LFP battery manufacturer,
Aleees) to work towards the development of a Lithium Iron Phosphate (LFP) battery cathode manufacturing plant in Darwin
using Avenira’s flagship Wonarah Phosphate Project.
No other events have occurred since 30 June 2022 that would materially affect the operations of the Group, the results of the
Group or the state of affairs of the Group not otherwise disclosed in the Group’s financial statements.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, YEAR ENDED 30 JUNE 2022
67
26. STATEMENT OF CASHFLOWS
2022
2021
$
$
Reconciliation of net loss after income tax to net cash outflow from operating activities
Net loss from continuing operations
(2,875,209)
(2,105,959)
Net loss from discontinuing operations
-
-
Adjustment for non-cash items
Depreciation of plant and equipment
34,492
34,214
Share based payment expense
7,334
77,919
Net foreign currency loss/(gain)
1,560
(51)
Impairment of exploration and evaluation expenditure
676,173
92,924
Disposal of intangibles loss/(gain)
-
-
Change in operating assets and liabilities,
net of effects from purchase of controlled entities
Increase in trade and other receivables
11,436
20,070
Increase/(decrease) in trade and other payables
568,204
203,866
Increase (decrease) in provisions
(22,717)
(36,989)
Net cash outflow from operating activities from operating activities
(1,598,727)
(1,714,006)
Change in liabilities from financing activities
Opening
balance
1-Jul-21
Additions
during the
year
Interest
accrued
Adjustment
s
Payments
Forgiven
during the
period
Closing
balance
30-Jun-22
Interest bearing loans &
borrowings
2,480,000
845,649
228,307
(351,000)
-
-
3,202,956
Lease liabilities
54,889
-
2,207
(684)
(40,000)
-
16,412
2,534,889
845,649
230,514
(351,684)
(40,000)
-
3,219,368
(1) During the period the Company received a loan of $351,000, this was settled via the issue of shares with a fair value of these shares resulting
in a loss of $145,800 being recognised on the profit and loss.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, YEAR ENDED 30 JUNE 2022
68
27. EARNINGS PER SHARE
Accounting Policies
Basic earnings per share
Basic earnings per share is calculated by dividing the loss attributable to owners of the Company, excluding any costs of
servicing equity other than ordinary shares, by the weighted average number of ordinary shares outstanding during the
financial year, adjusted for bonus elements in ordinary shares issued during the year.
Diluted 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.
2022
2021
$
$
(a) Reconciliation of earnings used in calculating loss per share
Loss attributable to the owners of the Company used in calculating basic and
diluted loss per share
(2,875,209)
(2,105,959)
Between the reporting date and the date of authorisation of these financial statements no additional securities were issued
that could potentially dilute basic loss per share in the future.
2022
2021
NUMBER OF
SHARES
NUMBER OF
SHARES
(b) Weighted average number of shares used as the denominator
Weighted average number of ordinary shares used as the denominator in
calculating basic loss per share
889,070,259
798,750,003
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, YEAR ENDED 30 JUNE 2022
69
28.
SHARE BASED PAYMENTS
Accounting Policies
The Group provides benefits to employees (including directors) of the Group in the form of share-based payment transactions,
whereby employees render services in exchange for shares or rights over shares (‘equity-settled transactions’). The cost of
these equity-settled transactions with employees is measured by reference to the fair value at the date at which they are
granted. The fair value is determined by an internal valuation using a Black-Scholes option pricing model and Monte Carlo
methodology as appropriate.
The cost of equity-settled transactions is recognised, together with a corresponding increase in equity, over the period in
which the performance conditions are fulfilled, ending on the date on which the relevant employees become fully entitled to
the award (‘vesting date’).
The cumulative expense recognised for equity-settled transactions at each reporting date until vesting date reflects (i) the
extent to which the vesting period has expired and (ii) the number of options or performance rights that, in the opinion of the
directors of the Group, will ultimately vest. This opinion is formed based on the best available information at balance date. No
adjustment is made for the likelihood of market performance conditions being met as the effect of these conditions is included
in the determination of fair value at grant date.
No expense is recognised for awards that do not ultimately vest, except for awards where vesting is conditional upon a market
condition. Where an equity-settled award is cancelled, it is treated as if it had vested on the date of cancellation, and any
expense not yet recognised for the award is recognised immediately. However, if a new award is substituted for the cancelled
award, and designated as a replacement award on the date that it is granted, the cancelled and new award are treated as if
they were a modification of the original award.
(a) Performance Rights Plan
There were no performance rights granted during the year ended 30 June 2022 (2021: Nil).
(b) Options
In September 2021, 3,000,000 options were issued to employees. Options were issued in two tranches with a different
exercise price for each tranche being 2.0 cents and 3.0 cents, and all have an expiry date of 30 June 2024.
A further 37,077,000 free options were granted pursuant to the Entitlement Offer in March 2022, with an expiry date of 30
April 2024.
All options granted by the Company carry no dividend or voting rights. When exercisable, each option is convertible into one
ordinary share of the Company with full dividend and voting rights.
The below table summarises the number and movement in options granted and their weighted average prices:
AVENIRA LIMITED
AVENIRA LIMITED
2022
2021
NUMBER OF
OPTIONS
WEIGHTED
AVERAGE
EXERCISE PRICE
NUMBER OF
OPTIONS
WEIGHTED
AVERAGE
EXERCISE PRICE
Outstanding at the beginning of the year
60,000,000
$0.026
48,000,000
$0.025
Granted – Sept 2021
3,000,000
$0.025
12,000,000
$0.03
Granted – March 2022
37,077,000
$0.022
Exercised
(719)
$0.022
-
-
Expired
-
-
-
-
Outstanding at the end of the year
100,076,281
$0.025
60,000,000
$0.026
Exercisable at the end of the year
100,076,281
60,000,000
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, YEAR ENDED 30 JUNE 2022
70
28. SHARE BASED PAYMENTS (continued)
All options issued during the year were valued using the Black-Scholes option pricing model. The fair value of the options
granted during the 2022 year was estimated on the date of grant using the following inputs:
Key estimates and assumptions
The Group measures the cost of equity-settled transactions with employees by reference to the fair value of the equity
instruments at the date at which they are granted. The fair value is determined by an internal valuation using a Black- Scholes
option pricing model using the assumptions detailed above.
As disclosed in Section C paragraph 2.2. of the Remuneration Report, the Board approved a bonus to Mr. Clark of $80,000
of which $40,000 will be issued in options to be approved by shareholders at the Company’s next AGM.
In addition to this, the Board also approved the issue of employee bonus options amounting to $32,500. These will also
require shareholder approval at the Company’s next AGM, prior to being issued.
2022
2021
TRANCHE 1
TRANCHE 2
TRANCHE 1
TRANCHE 2
Options issued
1,500,000
1,500,000
6,000,000
6,000,000
Measurement date
21/09/2021
21/09/2021
07/09/2020
07/09/2020
Exercise price (cents)
$0.02
$0.03
$0.025
$0.035
Fair value at grant date
0.007
0.006
0.007
0.006
Volatility
100%
100%
100%
100%
Risk free rate
0.19%
0.19%
0.23%
0.23%
Expiry date
30/06/2024
30/06/2024
07/09/2023
07/09/2023
Historically volatility has been used as the basis for determining expected share price volatility as it assumed that this is
indicative of future trends, which may not eventuate
Fair value of options that were granted or
vested to employees and or directors and
recognised in the profit or loss statement
$3,809
$3,525
$41,858
$36,061
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS, YEAR ENDED 30 JUNE 2022
71
29. PARENT ENTITY INFORMATION
The following information relates to the parent entity, Avenira Limited, at 30 June 2022. The information presented here
has been prepared using accounting policies consistent with Group accounting policies.
2022
2021
$
$
(a) Financial position
Assets
Current assets
1,068,138
3,245,453
Non-current assets
3,217,775
3,389,719
Total assets
4,285,913
6,635,172
Liabilities
Current liabilities
761,283
491,537
Non-current liabilities
3,202,956
2,480,000
Total liabilities
3,964,239
2,971,537
Net Asset Position
321,674
3,663,635
Equity
Contributed equity
142,385,648
140,516,513
Reserves:
-
Share based payments
17,151,481
17,071,647
-
Performance rights
603,701
603,701
-
Financial assets at FVOCI
20,503
486,432
Accumulated losses
(159,839,659)
(155,014,658)
Total equity
321,674
3,663,635
(b) Financial performance
Loss for the year
(2,164,569)
(1,829,463)
Other comprehensive income
-
-
Total comprehensive loss for the year
(2,164,569)
(1,829,463)
(c) Details of any contingent liabilities of the parent entity
The parent entity does not have any contingent liabilities at 30 June 2022.
(d) Details of any commitments by the parent entity for the acquisition of property, plant and equipment
There are no contractual commitments by the parent entity for the acquisition of property, plant and equipment as at
reporting date.
72
DIRECTORS’ DECLARATION
The Directors declare that:
1.
The financial statements and notes set out on pages 34 to 71 are in accordance with the Corporations Act 2001,
including:
a.
complying with Accounting Standards, the Corporations Regulations 2001 and other mandatory
reporting requirements; and
b.
giving a true and fair view of the consolidated entity’s financial position as at 30 June 2022 and of their
performance for the financial year ended on that date;
2.
In their opinion, 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
3.
A statement that the attached financial statements are in compliance with International Financial Reporting
Standards has been included in the notes to the financial statements.
The directors have been given the declarations by the chief executive officer and chief financial officer required by section
295A of the Corporations Act 2001.
This declaration is made in accordance with a resolution of the directors.
Brett Clark
Executive Chairman
Perth, 28 September 2022
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF AVENIRA LIMITED
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Avenira Limited (“the Company”) and its subsidiaries (“the Group”),
which comprises the consolidated statement of financial position as at 30 June 2022, the consolidated
statement of profit or loss and other comprehensive income, the consolidated statement of changes in equity
and the consolidated statement of cash flows for the year then ended, and notes to the financial statements,
including a summary of significant accounting policies, and the directors’ declaration.
In our opinion:
a.
the accompanying financial report of the Group is in accordance with the Corporations Act 2001,
including:
(i)
giving a true and fair view of the Group’s financial position as at 30 June 2022 and of its financial
performance for the year then ended; and
(ii)
complying with Australian Accounting Standards and the Corporations Regulations 2001.
b.
the financial report also complies with International Financial Reporting Standards as disclosed in Note
1.
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those
standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Report section of
our report. We are independent of the Group in accordance with the auditor independence requirements of the
Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards
Board’s APES 110 Code of Ethics for Professional Accountants (the Code) that are relevant to our audit of the
financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
Material Uncertainty Related to Going Concern
We draw attention to Note 1 in the financial report, which indicates that the Group incurred a net loss of
$2,875,209 during the year ended 30 June 2022. As stated in Note 1 these events or conditions, along with
other matters as set forth in Note 1, indicate that a material uncertainty exists that may cast significant doubt
on the Group’s ability to continue as a going concern. Our opinion is not modified in respect of this matter.
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit
of the financial report of the current period. These matters were addressed in the context of our audit of the
financial report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on
these matters.
Key Audit Matter
How our audit addressed the Key Audit Matter
Capitalised Exploration and Evaluation Expenditure
(Refer to Note 12)
The Group has capitalised exploration and
evaluation expenditure of $8,927,892 as at
balance date.
Exploration and evaluation expenditure is
considered to be a key audit matter due to:
•
The significance of the balance to the
Group’s financial position; and
•
The level of judgement required in
evaluating management’s application of
the requirements of AASB 6 Exploration
for and Evaluation of Mineral Resources
(“AASB 6”). AASB 6 is an industry
specific accounting standard requiring
the
application
of
significant
judgements, estimates and industry
knowledge.
This
includes
specific
requirements for expenditure to be
capitalised as an asset and subsequent
requirements which must be complied
with for capitalised expenditure to
continue to be carried as an asset.
Our procedures included, amongst others:
•
Assessing management’s determination of its areas of
interest for consistency with the definition in AASB 6.
This involved analysing the tenements in which the
Group holds an interest and the exploration programs
planned for those tenements.
•
For each area of interest, we assessed a sample of the
Group’s
rights
to
tenure
by
corroborating
to
government registries and evaluating agreements in
place with other parties as applicable.
•
We considered the activities in each area of interest to
date and assessed the planned future activities for
each area of interest by evaluating budgets.
•
Substantiated a sample of expenditure by agreeing to
supporting documentation.
•
We assessed each area of interest for one or more of
the
following circumstances that may indicate
impairment of the capitalised expenditure:
o
the licenses for the right to explore expiring
in the near future or are not expected to be
renewed;
o
substantive
expenditure
for
further
exploration in the specific area is neither
budgeted or planned;
o
decision or intent by the Company to
discontinue activities in the specific area of
interest due to lack of commercially viable
quantities of resources; and
o
data
indicating
that,
although
a
Key Audit Matter
How our audit addressed the Key Audit Matter
development in the specific area is likely to
proceed, the carrying amount of the
exploration asset is
unlikely to be
recovered
in
full
from
successful
development or sale.
• Examination of the disclosures made in the financial
report.
Loans and Borrowings
(Refer to Note 15)
The Group has loans and borrowings of
$3,202,956 as at balance date.
Loans and borrowings are considered to be
key audit matter due to the significance of
the balance to the Group’s financial position.
Our procedures included, amongst others:
•
Analysing the Loan Agreement to identify the key terms
and conditions;
•
Verifying the funds receipted on draw down of the loan;
•
Assessing the accounting treatment of the financial
instrument in accordance with the recognition and
measurement as well as the disclosure requirements of
the relevant Australian Accounting Standards;
•
Assessing the calculation of the relevant interest
expense for the year; and
•
Examination of the disclosures made in the financial
report.
Other Information
The directors are responsible for the other information. The other information comprises the information
included in the Group’s annual report for the year ended 30 June 2022 but does not include the financial report
and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not express
any form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information and, in
doing so, consider whether the other information is materially inconsistent with the financial report or our
knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of the Directors for the Financial Report
The directors of the Company are responsible for the preparation of the financial report that gives a true and
fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such
internal control as the directors determine is necessary to enable the preparation of the financial report that
gives a true and fair view and is free from material misstatement, whether due to fraud or error. In Note 1, the
directors also state in accordance with Australian Accounting Standard AASB 101 Presentation of Financial
Statements, that the financial report complies with International Financial Reporting Standards.
In preparing the financial report, the directors are responsible for assessing the Group’s ability to continue as
a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis
of accounting unless the directors either intend to liquidate the Group or to cease operations, or has no realistic
alternative but to do so.
Auditor’s Responsibilities for the Audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from
material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in
accordance with the Australian Auditing Standards will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate,
they could reasonably be expected to influence the economic decisions of users taken on the basis of this
financial report.
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional judgement
and maintain professional scepticism throughout the audit. We also:
•
Identify and assess the risks of material misstatement of the financial report, whether due to fraud or
error, design and perform audit procedures responsive to those risks, and obtain audit evidence that
is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material
misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve
collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
•
Obtain an understanding of internal control relevant to the audit in order to design audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Group’s internal control.
•
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the directors.
•
Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and,
based on the audit evidence obtained, whether a material uncertainty exists related to events or
conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we
conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to
the related disclosures in the financial report or, if such disclosures are inadequate, to modify our
opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s
report. However, future events or conditions may cause the Group to cease to continue as a going
concern.
•
Evaluate the overall presentation, structure, and content of the financial report, including the
disclosures, and whether the financial report represents the underlying transactions and events in a
manner that achieves fair presentation.
•
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or
business activities within the Group to express an opinion on the financial report. We are responsible
for the direction, supervision, and performance of the Group audit. We remain solely responsible for
our audit opinion.
We communicate with the directors regarding, among other matters, the planned scope and timing of the audit
and significant audit findings, including any significant deficiencies in internal control that we identify during
our audit.
We also provide the directors with a statement that we have complied with relevant ethical requirements
regarding independence, and to communicate with them all relationships and other matters that may
reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with the directors, we determine those matters that were of most significance
in the audit of the financial report of the current period and are therefore the key audit matters. We describe
these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or
when, in extremely rare circumstances, we determine that a matter should not be communicated in our report
because the adverse consequences of doing so would reasonably be expected to outweigh the public interest
benefits of such communication.
Report on the Remuneration Report
We have audited the Remuneration Report included in the directors’ report for the year ended 30 June 2022.
The directors of the Company are responsible for the preparation and presentation of the remuneration report
in accordance with s 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the
remuneration report, based on our audit conducted in accordance with Australian Auditing Standards.
Auditor’s Opinion
In our opinion, the Remuneration Report of Avenira Limited, for the year ended 30 June 2022, complies with
section 300A of the Corporations Act 2001.
HALL CHADWICK WA AUDIT PTY LTD
D M BELL CA
Director
Dated this 28th day of September 2022
Perth, Western Australia
78
ASX ADDITIONAL INFORMATION
Additional information required by Australian Securities Exchange Ltd and not shown elsewhere in this report is as
follows. The information is current as at 20 September 2022.
(a)
Distribution of equity securities
Analysis of numbers of equity security holders by size of holding:
ORDINARY SHARES
NUMBER OF
HOLDERS
NUMBER OF
SHARES
1 – 1,000
235
22,297
1,001 – 5,000
107
351,013
5,001 – 10,000
134
1,059,661
10,001 – 100,000
1,103
52,502,900
100,001 and over
1,052
1,163,399,268
2,631
1,217,335,139
The number of equity security holders holding less than a marketable parcel of securities
are:
1,126
21,098,225
(b) Twenty largest shareholders
The names of the twenty largest holders of quoted ordinary shares are:
Top Holders Grouped
Position
Holder Name
Holding
% IC
1
AU XINGAO INVESTMENT PTY LTD
87,654,129
7.20%
2
ANOVA METALS LIMITED
35,762,303
2.94%
3
AWAKENING INVESTMENT PTY LTD
21,597,005
1.77%
4
MRS VINEETA GUPTA
20,733,821
1.70%
5
HOLY INVESTMENTS PTY LTD
17,334,866
1.42%
6
BNP PARIBAS NOMS PTY LTD
17,151,318
1.41%
7
AZUNA FOODS PTY LTD
17,000,000
1.40%
8
MR MARCUS STEVEN DING
15,883,928
1.30%
9
MR PHILLIP JAMES EDMONDS
15,500,000
1.27%
10
MS CHUNYAN NIU
15,000,000
1.23%
11
MR GIOVANNI DEL CONTE
14,849,612
1.22%
12
SOCIETE DE POLYSERVE POUR LES ENGRAIS ET PRODUITS
CHIMIQUES SA\C
14,703,962
1.21%
13
STC SUPER HOLDINGS PTY LTD
10,826,679
0.89%
14
TORNADO NOMINEES PTY LTD
10,000,000
0.82%
15
MERINDA HOLDINGS PTY LTD
9,484,794
0.78%
16
MR LUKE HUANG
8,947,470
0.74%
17
MR HONG LAM PHAM
8,553,885
0.70%
18
MGL CORP PTY LTD
8,000,000
0.66%
19
FIRST INVESTMENT PARTNERS PTY LTD
7,500,000
0.62%
19
TRINITY DIRECT PTY LTD
7,500,000
0.62%
20
MR BRETT WILMOTT
7,153,567
0.59%
Total
371,137,339
30.49%
Total issued capital - selected security class(es)
1,217,335,139
100.00%
79
(c)
Substantial shareholders
Name
Units
% Units
AU XINGAO INVESTMENT PTY LTD
87,654,129
7.20%
(d) Unquoted Equity Securities
The names of the security holders holding more than 20% or more of any unlisted class of security, other than those securities
issued or acquired under an employee incentive scheme, are listed below:
UNLISTED OPTIONS
EXP 07/09/23 @
$0.025
UNLISTED OPTIONS
EXP 07/09/23 @
$0.035
TAYCOL NOMINEES PTY LTD
6,000,000
6,000,000
TOTAL HOLDERS
1
1
(e)
Voting rights
All ordinary shares (whether fully paid or not) carry one vote per share without restriction.
(f)
Company Secretary, registered and principal administrative office and share registry
Details can be found in the Corporate Information on page 3 of the Annual Report.
(g) Schedule of interest in mining tenements
LOCATION
TENEMENT
PERCENTAGE HELD /
EARNING
Arruwurra, Northern Territory
EL29840
100
Dalmore, Northern Territory
EL29849
100
Central Wonarah, Northern Territory
EL32359
100
South Arruwurra, Northern Territory (1)
EL33193
100
East Murchison, Western Australia
E 53/2078
100
East Murchison, Western Australia
E 53/2079
100
East Murchison, Western Australia
E 53/1856
100
East Murchison, Western Australia
E 53/1859
100
Darlot, Western Australia
P 37/9539
100
Barwidgee, Western Australia (1)
P 53/1712
100
Barwidgee, Western Australia (1)
P 53/1713
100
(1)
Tenements granted in July 2022