ABN 79 131 843 868
Annual Report
for the year ended 30 June 2017
PEAKO LIMITED
ABN 79 131 843 868
TABLE OF CONTENTS
Corporate Directory ............................................................................................................................. 3
Chairman’s Letter ................................................................................................................................. 4
Operations Report ................................................................................................................................ 5
Corporate ............................................................................................................................................. 5
Minerals Interests ................................................................................................................................ 5
Oil & Gas Interests ............................................................................................................................... 6
Corporate Governance ......................................................................................................................... 7
Directors’ Report .................................................................................................................................. 7
Remuneration Report ........................................................................................................................ 10
Auditor’s Independence Declaration ................................................................................................. 14
Consolidated Statement of Profit or Loss and Other Comprehensive Income ................................. 15
Consolidated Statement of Financial Position ................................................................................... 16
Consolidated Statement of Changes in Equity................................................................................... 17
Consolidated Statement of Cash Flows ............................................................................................. 18
Notes to the Financial Statements ..................................................................................................... 19
Directors’ Declaration ........................................................................................................................ 38
Independent Auditor’s Report to the Members ................................................................................ 39
Additional Shareholder Information (unaudited) .............................................................................. 42
Forward–looking Statements
This Financial Report includes certain forward-looking statements that have been based on current
expectations about future acts, events and circumstances. These forward-looking statements are,
however, subject to risks, uncertainties and assumptions that could cause those acts, events and
circumstances to differ materially from the expectations described in such forward-looking
statements.
These factors include, among other things, commercial and other risks associated with the meeting of
objectives and their investment considerations, as well as other matters not yet known to the
Company or not currently considered material by the Company.
Risk Factors
Exploration for and development of natural resources is speculative, expensive and subject to a wide
range of risks. There can be no assurance that the activities of the Company will result in the discovery
of petroleum or minerals, nor that any discovery or development will prove to be commercially viable.
Individual investors should consider these matters in light of their personal circumstances (including
financial and taxation affairs) and seek professional advice from their accountant, lawyer or other
professional adviser as to the suitability of an investment in the company.
2
PEAKO LIMITED
ABN 79 131 843 868
Corporate Directory
Directors
Geoffrey Albers
Raewyn Clark
Peter Armitage
Company Secretary
Robert Wright
Non-Executive Chairman
Executive Director
Non-Executive Director
Registered Office
Level 21, 500 Collins Street
Melbourne Vic 3000
Website: www.peako.com.au
Email: info@peako.com.au
Ph: (03) 8610 4702
Fax: (03) 8610 4799
Auditor
Grant Thornton Audit Pty Ltd
Level 30
525 Collins Street
Melbourne, Victoria 3000 Australia
Share Registry
(From 2 October 2017)
Automic Pty Ltd
Level 3
50 Holt Street
Surry Hills, NSW 2010, Australia
Telephone: 1300 288 664 (within Australia)
Telephone: +61 (2) 9698 5414 (outside Australia)
Website: www.automic.com.au
Securities Exchange Listing
ASX Limited
Level 4, North Tower, Rialto
525 Collins Street
Melbourne Victoria 3000
Website: www.asx.com.au
ASX Code: PKO
Incorporated in Western Australia 25 June 2008
3
PEAKO LIMITED
ABN 79 131 843 868
Chairman’s Letter
Dear Shareholders
Peako is a natural resources company, incorporated in Australia, with its securities listed on the ASX.
Its focus is on energy in all its forms.
2016/17 was a year of further consolidation for the company. Exploration Licence E45/3278 at
Sunday Creek, was granted following successful negotiations with Western Desert Lands Aboriginal
Corporation which resulted in execution of a Land Access and Mineral Exploration Agreement.
The Sunday Creek Prospect, in the Paterson Province of Western Australia, had been held under
application by the company for a number of years since ASX listing. The Paterson region is well known
for its gold, base metals and uranium potential and is an active area of exploration for base and other
minerals. Following grant, the Company undertook desktop studies and obtained samples and data
previously acquired by a third party.
There have been no developments in relation to the Cadlao petroleum interests during the year. The
arbitration commenced some years ago by Peako against Cadlao Development Company Limited
(Cadco) and Blade Petroleum Limited (Blade), in relation to the Cadco Buy-back Right, was terminated
by the Arbitrator at Peako’s request in December 2016. Cadco had failed to respond to any
communication from Peako or the Arbitrator for more than two years and Peako learned that Blade
Petroleum Limited was in liquidation. As such, the arbitration was considered to have little prospect of
a meaningful outcome. The investment had been previously fully impaired. The proceeds sharing
arrangement with Octanex Limited, whereby Peako agreed to share any proceeds derived in relation
its Cadlao interests up to a limit of $1,603,683 will end on 26 November 2017. There is no expectation
of their being any such proceeds. The Company will cease reporting on the Cadlao interests, unless
further matters arise.
Peako maintained extreme fiscal discipline during the year. Directors continue to forgo directors’ fees
and all other forms of corporate expenditure have been limited or reduced.
During the year the Company consolidated its share capital on a 1 for 20 basis in order to make the
Company’s share structure a more attractive investment vehicle for capital raising purposes and
attractive to potential project partners. In this vein, the Company anticipates that it will conduct a
modest pro rata share capital raising during the last quarter of this year to provide working capital for
its activities.
Peako is now positioned to test the potential of its minerals exploration interests, as well as to review
other opportunities.
EG Albers - Chairman
Peako Limited
28 September 2017
4
PEAKO LIMITED
ABN 79 131 843 868
Operations Report
Corporate
During the year the Company continued to maintain tight fiscal discipline.
Minerals Interests
Mineral Exploration Interests – Paterson Province Projects, Western Australia
Paterson
Figure 1 Paterson Province Projects Location Map
Peako’s Paterson Province Projects; the Sunday
Creek and Mount Sears initiatives, comprise a
~403km2 tenement package in the Rudall River
area of the Paterson Province of Western
Australia. The Paterson region is well known
for its gold, base metals and uranium potential,
hosting Australia’s fifth largest uranium deposit
at Kintyre. Uranium occurrences are known in
both the Sunday Creek and Mount Sears
prospects. Both prospects are considered
polymetallic.
four
Peako’s tenement package comprises
tenements, one of which
is the granted
Exploration Licence E45/3278, and three at the
applications stage. They were the cornerstone
of Peako’s portfolio of mineral assets when it
first listed on ASX as Raisama Limited in 2009.
Exploration activities commenced with the
the
acquisition of past exploration data,
assessment of which will inform and shape our
exploration work program for the Sunday Creek
project.
Peako’s Paterson Province tenement package is shown below.
Figure 1 Paterson Province Tenement Package
5
PEAKO LIMITED
ABN 79 131 843 868
The Sunday Creek area was first
explored by others between
1978 and 1981. The lack of high
resolution data available at that
time resulted in limited
structural interpretation by
previous explorers.
as
The Sunday Creek Prospect was
initially
a
identified
radiometric anomaly without
GPS or high resolution airborne
data, with subsequent rock chip
samples
copper,
containing
uranium and lead. Radiometric
anomalies were also followed up
with soil geochemical surveys,
which produced
low assay
responses, mainly due to sand
cover.
Figure 2 Best Uranium Hits in E45/3278 - Location of Occidental 1980 Drill Holes
A four-hole reconnaissance drilling program was done at spacing of 4km and a prospective contact of
20km strike length is considered to remain largely untested.
The Mount Sears Prospect is located 25 kilometres east of the Sunday Creek Prospect covering an area
of 150km2. A known uranium occurrence in the Mount Sears Range was discovered by Occidental
Minerals Corporation in 1978 and has an associated airborne radiometric uranium anomaly. An
overview of the Mount Sears project geology and historic data indicates that the project area is
prospective for copper and uranium.
In June 2017, following the March 2017 change of government of Western Australia to the Mark
McGowan led Labor Party, the McGowan government implemented a ban on uranium mining on all
future granted mining leases in Western Australia. Peako is reviewing its exploration work program
as a consequence of this ban.
Oil & Gas Interests
SC6 (Cadlao) - Cadlao Oilfield Re-development Project, the Philippines
Since the last Annual Report there have been no developments and no activity in relation to the Cadlao
interests. The investment has been previously fully impaired. The Company will cease reporting on
this interest.
6
PEAKO LIMITED
ABN 79 131 843 868
Corporate Governance
The Board is responsible for the strategic direction of the Company, the identification and
implementation of corporate policies and goals, and the monitoring of the business and affairs of the
Company on behalf of its shareholders.
The Board is currently comprised of three Directors. In accordance with the Company’s Constitution
and the ASX Listing Rules, the Directors (other than the Chief Executive Officer) are subject to re-
election by shareholders every three years.
The Board meets regularly throughout the year.
A corporate governance statement reporting on Peako’s governance framework, principles and
practices is provided on the Peak website www.peako.com.au
Directors’ Report
Your directors present their annual financial report on the consolidated entity (referred to hereafter
as the “Group”) consisting of Peako Limited (the “Company” or “parent entity”) and the entities it
controlled at the end of, or during, the financial year ended 30 June 2017. In order to comply with the
Corporations Act 2001, the directors report is as follows:
Directors
The following persons were directors of the Company during the financial year and up to the date of
this report:
Geoffrey Albers
Raewyn Clark
Peter Armitage
Non-Executive Chairman
Executive Director
Non-Executive Director
Information on Directors
E. Geoffrey Albers LLB, FAICD
Mr Albers was appointed to the board of Peako Limited on 4 February 2013. Mr Albers has over 35
years’ experience as a director and administrator in corporate law, resource exploration and resource
sector investment.
Mr Albers has interests in a number of companies active in the petroleum industry in Australia and
Malaysia. His companies are also active resource sector investors.
Mr Albers is also a director of the ASX listed companies Octanex Limited and Enegex Limited.
Raewyn Clark, B.Bus(dist), CA, MAICD, AGIA, ACIS
Mrs Clark has more than twenty years experience focussed primarily on the upstream oil and gas
sector. Her experience includes business development, financial modelling and analysis, capital raising
and mergers and acquisitions, as well as managing joint venture partners, government, regulator and
investor relations.
Mrs Clark was appointed to the Board on 4 December 2014. Mrs Clark is also a Director of the ASX
listed companies Octanex Limited and Enegex Limited. Mrs Clark resigned as Company Secretary of
Peako on 2 May 2017.
7
PEAKO LIMITED
ABN 79 131 843 868
Peter Armitage FCA FAICD
Mr Armitage was appointed to the board of Peako Limited on 18 August 2015. Mr Armitage began his
professional career with an international accounting firm. After qualification he was invited into
partnership of a national firm.
Since the early 1980s he has been a director of a number of listed exploration companies in both
Australia and New Zealand. He is currently a Non-Executive director of ASX listed Strategic Energy
Resources Limited and Enegex Limited.
Information on Company Secretary
Robert Wright
B Bus, CPA
Mr Wright was appointed as Company Secretary of Peako on 2 May 2017. Mr Wright is a senior
financial professional with over 25 years commercial experience in the resource, energy and
manufacturing industries gained at various companies and locations, including 14 years at BHP. As
well as carrying out his secretarial duties for Peako, he is the company’s Chief Financial Officer and the
Company Secretary and CFO of the ASX listed companies Octanex Limited and Enegex Limited. Mr
Wright is a member of CPA Australia.
Ordinary shares
During the year the share capital of the Company was consolidated on a one for twenty basis, making
the company’s share capital more workable and a more attractive investment vehicle. The number of
shares on issue reduced from 1,020,380,247 to 51,019,137.
Options
As at 30 June 2017 and to the date of this report there were 5,000,000 options on issue (30 June 2016:
20,000,000). 5,000,000 options exercisable at $0.04 (4 cents) each, expiring 24 November 2019 were
granted to directors at the general meeting on 24 November 2016. 20,000,000 options exercisable at
$0.28 (28 cents) expired on 25 November 2016.
Dividends
No dividend has been paid or declared since the start of the financial year and the directors do not
recommend the payment of a dividend in respect of the financial year.
Principal activities
The principal activities of the Group during the financial year continue to be direct and indirect equity
investments made with the objective of advancing the exploration for and development of natural
resources.
Review of operations
A detailed review of the Group's activities and operations is set out on pages 5-6 of this Report.
Significant changes in the state of affairs
There have been no significant changes in the state of affairs of the Group to the date of this Report,
other than those changes detailed in the review of activities and operations, and elsewhere in this
Report.
Matters subsequent to balance date
There are no significant after balance date events up to the signing of this report.
8
PEAKO LIMITED
ABN 79 131 843 868
Likely developments and expected results
The Group will continue to pursue projects which seek to provide sound opportunities for future
development during the next financial year. Likely developments and expected results of the
operations of the Group in subsequent years are not discussed further in this report. In the opinion of
the directors, further information on those matters could prejudice the interests of the Company.
Environmental legislation
The Group is subject to significant environmental legal regulations in respect to its exploration and
evaluation activities in Australia. There have been no known breaches of these regulations and
principles.
Indemnification of directors and officers
During the financial year and to the date of this report, the company did not pay premiums in respect
of contracts insuring officers or auditors of the company against liabilities arising from their position
of officers or auditor of the company.
Meetings of directors
During the financial year there were two formal directors’ meetings. All other matters that required
formal Board resolutions were dealt with via written circular resolutions. In addition, the directors
met on an informal basis at regular intervals during the financial year to discuss the Group’s affairs.
The number of formal meetings of the Company’s board of directors and relevant committees attended
by each director were:
Geoffrey Albers
Raewyn Clark
Peter Armitage
Directors’
Meetings
Audit Committee
Meetings
Held
Attended Held
Attended
2
2
2
2
2
2
2
2
2
2
2
2
Proceedings on behalf of Company
No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring
proceedings on behalf of the Company, or to intervene in any proceedings to which the Company is a
party, for the purpose of taking responsibility on behalf of the Company for all or part of those
proceedings.
9
PEAKO LIMITED
ABN 79 131 843 868
Remuneration Report
This report is audited.
Directors / Executives
Position Held
Geffrey Albers
Raewyn Clark
Peter Armitage
Non-Executive Chairman
Executive Director
Non-Executive Director
During the year there were no employees or consultants to the company that meet the definition of
key management personnel, other than the directors.
Remuneration levels for company officers are competitively set to attract and retain experienced
directors.
The remuneration structure explained below is designed to attract suitably qualified candidates,
reward the achievement of strategic objectives and achieve the broader outcome of creation of value
for shareholders.
The remuneration structure takes into account:
•
•
the capability and experience of the directors; and
the ability of directors to control the entity’s performance.
Remuneration levels are reviewed annually through a process that considers the performance of
individual directors and the overall performance of the entity.
Director Remuneration
During the year under review, directors were remunerated a total of $33,744 (2016: $Nil) which
$Nil). This
included shareholder-approved non-executive remuneration of $6,949 (2016:
remuneration is made up entirely of share based payments in the form of options granted.
There is no performance related remuneration for directors.
The directors do not receive employee benefits, including annual leave and long service leave, but
remuneration may include the grant of options (share based payments) over shares of the company to
align directors’ interests with that of the shareholders. The company aims to reward directors with a
level and mix of remuneration commensurate with their position and responsibilities within the
company.
There is no direct relationship between remuneration of directors and the company’s performance for
the last five years.
10
PEAKO LIMITED
ABN 79 131 843 868
REMUNERATION REPORT (Continued)
Components of directors’ compensation are disclosed below.
Primary benefits paid / payable
Equity Settled
Salary
Directors’
fees
Super-
annuation
Equity
option issued
TOTAL
Year ended 30 June
2017
Directors
Geoffrey Albers
Raewyn Clark
Peter Armitage
$
-
-
-
-
$
-
-
-
-
$
-
-
-
-
$
$
-
26,995
6,949
33,744
-
26,995
6,949
33,744
Primary benefits paid / payable
Equity Settled
Salary and/or
consulting
fees
Directors’
fees
Super-
annuation
Equity
option issues
TOTAL
Year ended 30 June
2016
Directors
Geoffrey Albers
Raewyn Clark
Peter Armitage
$
-
-
-
-
$
-
-
-
$
-
-
-
$
-
-
-
$
-
-
-
-
Loans to key management personnel
No loans were made key management personnel during the current or previous financial year.
Other transactions with key management personnel
In the year ended 30 June 2017, the Company incurred consulting fees of $25,211 (2016: $7,290) with
Samika Pty Ltd, a director-related entity of Raewyn Clark. The fees were provided under normal
commercial terms and conditions with $nil remaining unpaid at 30 June 2017(2016 $2,420).
11
PEAKO LIMITED
ABN 79 131 843 868
REMUNERATION REPORT (Continued)
Key management personnel interest in equity holdings
Fully paid ordinary shares
30 June 2017
Directors
Geoffrey Albers*
Raewyn Clark
Peter Armitage
Balance at
beginning of
year
Number
22,962,089*
-
-
22,962,089
Granted as
compensation
Number
Net change
other
Number
Balance at
end of year
Number
-
-
-
-
-
-
-
-
22,962,089
-
-
22,962,089
•
Adjusted for 1 for 20 share consolidation completed 1 December 2016
Unlisted options
30 June 2017
Directors
Geoffrey Albers
Raewyn Clark
Peter Armitage
Balance at the
beginning of
the year
Number
Granted
during the
year
Number
Expired
during the
year
Number
Other /
Transfers
Number
-
-
-
-
-
4,000,000
1,000,000
5,000,000
-
-
-
-
-
-
-
-
Balance at
the end of
the year
Number
-
4,000,000
1,000,000
5,000,000
Vested and
exercisable at
the end of
year
Number
-
4,000,000
1,000,000
5,000,000
5,000,000 options exercisable at $0.04 (4 cents) each, expiring 24 November 2019 were granted to
directors at general meeting on 24 November 2016. There are no performance conditions attached to
these options as the directors do not receive employee benefits, including annual leave and long
service leave and the grant of options (share based payments) over shares of the company will align
directors’ interests with that of the shareholders.
End of remuneration report
12
PEAKO LIMITED
ABN 79 131 843 868
Auditor independence
Section 307C of the Corporations Act 2001 requires our auditors, Grant Thornton Audit Pty Ltd, to
provide the directors of the Company with an Independence Declaration in relation to the audit of the
annual report. This Independence Declaration is set out on page 14 and forms part of this directors’
report for the year ended 30 June 2017.
Non-audit services
The Company may decide to employ the auditor on assignments additional to their statutory audit
duties where the auditor’s expertise and experience with the Company and/or the Group are
important. The Company has considered the position and is satisfied that the provision of the non-
audit services is compatible with the general standard of independence for auditors imposed by the
Corporations Act 2001. The auditor has not provided any non-audit services and as such auditor
independence was not compromised.
This report is made in accordance with a resolution of the directors.
RL Clark
Director
28 September 2017
13
The Rialto, Level 30
525 Collins St
Melbourne Victoria 3000
Correspondence to:
GPO Box 4736
Melbourne Victoria 3001
T +61 3 8320 2222
F +61 3 8320 2200
E info.vic@au.gt.com
W www.grantthornton.com.au
AUDITOR’S INDEPENDENCE DECLARATION
TO THE DIRECTORS OF PEAKO LIMITED
In accordance with the requirements of section 307C of the Corporations Act 2001, as lead auditor
for the audit of Peako Limited for the year ended 30 June 2017, I declare that, to the best of my
knowledge and belief, there have been:
a
no contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit; and
b
no contraventions of any applicable code of professional conduct in relation to the audit.
GRANT THORNTON AUDIT PTY LTD
Chartered Accountants
A R J Nathanielsz
Partner - Audit & Assurance
Melbourne, 28 September 2017
Grant Thornton Audit Pty Ltd ACN 130 913 594
a subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389
‘Grant Thornton’ refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory services to their clients and/or refers to
one or more member firms, as the context requires. Grant Thornton Australia Ltd is a member firm of Grant Thornton International Ltd (GTIL). GTIL and the
member firms are not a worldwide partnership. GTIL and each member firm is a separate legal entity. Services are delivered by the member firms. GTIL does not
provide services to clients. GTIL and its member firms are not agents of, and do not obligate one another and are not liable for one another’s acts or omissions. In
the Australian context only, the use of the term ‘Grant Thornton’ may refer to Grant Thornton Australia Limited ABN 41 127 556 389 and its Australian subsidiaries
and related entities. GTIL is not an Australian related entity to Grant Thornton Australia Limited.
Liability limited by a scheme approved under Professional Standards Legislation.
PEAKO LIMITED
ABN 79 131 843 868
Consolidated Statement of Profit or Loss and Other Comprehensive Income
for the year ended 30 June 2017
Financial income
Other income
Expenses
Audit fees
Professional and consultancy fees
Depreciation charges
Financial expense
Insurance costs
Office costs
Other costs
Share based payment
Stock exchange and share registry costs
(Loss) / profit before income tax expense
Income tax expense
Net (loss) / profit for the year
Other comprehensive income
Items that may be reclassified to profit or loss
Foreign exchange (loss) / gain on translation of subsidiary financial
statements
Other comprehensive income net of tax
Total comprehensive income for the year
Basic (loss) / profit per share
Diluted (loss) /profit per share
Note
2
20
11
3
4
4
2017
$
3,767
-
3,767
(25,126)
(26,318)
-
-
-
(33,929)
(38,915)
(33,743)
(23,781)
(181,812)
(178,045)
-
(178,045)
2016
$
305
1,285,601
1,285,906
(37,500)
(21,791)
(3,578)
(10,497)
(17,127)
(25,143)
(42,296)
-
(21,017)
(178,949)
1,106,957
-
(178,045)
1,106,957
(207)
462
(207)
(178,252)
Cents
(0.35)
(0.35)
462
1,107,419
Cents
3.03
3.03
The above statement of profit or loss and other comprehensive income should be read in conjunction with the
accompanying notes.
15
PEAKO LIMITED
ABN 79 131 843 868
Consolidated Statement of Financial Position
as at 30 June 2017
Current Assets
Cash and cash equivalents
Trade and other receivables
Total Current Assets
Non-Current Assets
Trade and other receivables
Mineral exploration costs
Total Non-Current Assets
Total Assets
Current Liabilities
Trade and other payables
Total Current Liabilities
Total Liabilities
Net Assets
Equity
Issued capital
Reserves
Accumulated losses
Total Equity
Note
5
5
7
8
9
10
2017
$
112,685
1,788
114,473
5,777
8,322
14,099
2016
$
271,158
6,356
277,514
5,984
-
5,984
128,572
283,498
30,924
30,924
41,342
41,342
30,924
41,342
97,648
242,156
36,808,483
33,999
(36,744,834)
36,808,483
1,895,589
(38,461,916)
97,648
242,156
The above statement of financial position should be read in conjunction with the accompanying notes.
16
PEAKO LIMITED
ABN 79 131 843 868
Consolidated Statement of Changes in Equity
for the year ended 30 June 2017
Issued
capital
$
Share
compensation
reserve
$
Foreign currency
translation
reserve
$
Accumulated
losses
$
Total
equity/
(deficiency)
$
Balance at 1 July 2015
36,528,192
1,895,127
Profit for the year
Other comprehensive
income
Total comprehensive profit
for the year
-
-
-
-
-
-
Issue of shares
Share issue costs
Balance at 30 June 2016
343,068
(62,777)
36,808,483
-
-
1,895,127
-
-
462
462
-
-
462
(39,568,873)
(1,145,554)
1,106,957
1,106,957
-
462
1,106,957
1,107,419
-
-
(38,461,916)
343,068
(62,777)
242,156
Balance at 1 July 2016
36,808,483
1,895,127
462
(38,461,916)
242,156
Loss for the year
Other comprehensive loss
Total comprehensive loss
for the year
-
-
-
-
-
-
-
(207)
(178,045)
-
(178,045)
(207)
(207)
(178,045)
(178,252)
Expiry of options
Issue of options
Balance at 30 June 2017
-
-
36,808,483
(1,895,127)
33,744
33,744
-
-
255
1,895,127
-
(36,744,834)
-
33,744
97,648
The above statement of changes in equity should be read in conjunction with the accompanying notes.
17
PEAKO LIMITED
ABN 79 131 843 868
Consolidated Statement of Cash Flows
for the year ended 30 June 2017
Cash flows from operating activities
Payments to suppliers and employees
Financial income
Net cash outflows from operating activities
Cash flows from investing activities
Payments to suppliers - exploration
Proceeds from sale of permit interest
Net cash (outflow) / inflow from investing activities
Cash flows from financing activities
Proceeds from the issue of shares
Share issue costs
Net cash inflows from financing activities
Net (decrease) / increase in cash held
Cash at the beginning of reporting period
Effect of exchange rate fluctuations on cash held
Cash at the end of the reporting period
Note
18
2017
$
(153,988)
3,860
(150,128)
2016
$
(162,539)
167
(162,372)
(8,322)
-
(8,322)
-
100,000
100,000
-
-
-
(158,450)
271,158
(23)
112,685
343,068
(62,777)
280,291
217,919
52,985
254
271,158
The above statement of cash flows should be read in conjunction with the accompanying notes.
18
PEAKO LIMITED
ABN 79 131 843 868
Notes to the Financial Statements
for the Year Ended 30 June 2017
Note 1: Statement of significant accounting policies
(a) Basis of preparation
The financial report is a general-purpose financial report, which has been prepared in
accordance with the requirements of the Corporations Act 2001, Accounting Standards and
Interpretations and other requirements of the law. The financial report has also been
prepared on a historical cost basis. The Parent Entity is registered and domiciled in Australia.
The financial statements comprise the consolidated financial statements for the Group. For
the purposes of preparing the consolidated financial statements, the Company is a for-profit
entity.
The financial statements are presented in Australian dollars, unless otherwise stated.
Going concern
For the year ended 30 June 2017 the Group incurred a net cash outflow from operating and
investing activities of $158,450 and a net loss after tax of $178,045. As at 30 June 2017, the
Group has working capital of $83,549.
The Board considers that the Group is a going concern and recognises that additional funding
may be required to ensure that it can continue to fund its operations and further develop
exploration assets during the twelve month period from the date of this financial report. Such
additional funding is likely to be derived from a rights issue made to all shareholders.
Directors are confident that the Group will be able to successfully raise sufficient funding to
enable it to continue as a going concern for at least 12 months from the signing of the annual
financial report. If the Group is unable to raise sufficient capital for these purposes, there is a
material uncertainty that may cast doubt on the Group’s ability to continue as a going concern
and, therefore it may be unable to realise its assets and discharge its liabilities in the normal
course of business.
(b) Adoption of new and revised standards
Changes in accounting policies on initial application of Accounting Standards
In the year ended 30 June 2017, the directors have reviewed all of the new and revised
Standards and Interpretations issued by the AASB that are relevant to the Group’s operations
and effective for the current annual reporting period. It has been determined by the directors
that there is no impact, material or otherwise, of the new and revised Standards and
Interpretations on the Group and, therefore, no change is necessary to Group accounting
policies.
The directors have also reviewed all new Standards and Interpretations that have been issued
but are not yet effective for the year ended 30 June 2017. As a result of this review the
directors have determined that there is no impact, material or otherwise, of the new and
revised Standards and Interpretations on the Group and, therefore, no change is necessary to
Group accounting policies.
19
PEAKO LIMITED
ABN 79 131 843 868
Notes to the Financial Statements
for the Year Ended 30 June 2017
Note 1: Statement of significant accounting policies continued
(c) Statement of compliance
The financial report was authorised by the board of directors for issue on 26 September
2017.
The financial report complies with Australian Accounting Standards, which include Australian
equivalents to International Financial Reporting Standards (AIFRS). Compliance with AIFRS
ensures that the financial report, comprising the financial statements and notes thereto,
complies with International Financial Reporting Standards (IFRS).
(d) Basis of consolidation
The consolidated financial statements consolidate those of the parent company and all of its
subsidiaries as of 30 June 2017 (“Group”). The Parent controls a subsidiary if it is exposed, or has
rights, to variable returns from its involvement with the subsidiary and has the ability to affect
those returns through its power over the subsidiary. All subsidiaries have a reporting date of 30
June.
All transactions and balances between Group companies are eliminated on consolidation,
including unrealised gains and losses on transactions between Group companies. Where
unrealised losses on intra-group asset sales are reversed on consolidation, the underlying asset is
also tested for impairment from a group perspective. Amounts reported in the financial
statements of subsidiaries have been adjusted where necessary to ensure consistency with the
accounting policies adopted by the Group.
Profit or loss and other comprehensive income of subsidiaries acquired or disposed of during the
year are recognised from the effective date of acquisition, or up to the effective date of disposal,
as applicable.
Non-controlling interests, presented as part of equity, represent the portion of a subsidiary’s
profit or loss and net assets that is not held by the Group. The Group attributes total
comprehensive income or loss of subsidiaries between the owners of the parent and the non-
controlling interests based on their respective ownership interests.
(e) Exploration and evaluation expenditure
Exploration and evaluation assets, including the costs of acquiring permits or licences, are
capitalised as exploration and evaluation assets on an area of interest basis. Exploration and
evaluation assets are only recognised if the rights to tenure of the area of interest are current and
either:
(i)
(ii)
the expenditures are expected to be recouped through successful development and
exploitation of the area of interest, or alternatively, by its sale or partial sale: or
activities in the area of interest have not at the reporting date, reached a stage which
permits a reasonable assessment of the existence or otherwise of economically
recoverable reserves and active and significant operations in, or in relation to, the area of
interest are continuing.
20
PEAKO LIMITED
ABN 79 131 843 868
Notes to the Financial Statements
for the Year Ended 30 June 2017
Note 1: Statement of significant accounting policies continued
(e)
Exploration and evaluation expenditure continued
Exploration and evaluation assets are assessed for impairment if the facts and circumstances
suggest that the carrying amount of an exploration and evaluation asset may exceed its
recoverable amount. One or more of the following facts and circumstances indicate that an
entity should test exploration and evaluation assets for impairment (the list is not exhaustive):
(i)
(ii)
(iii)
(iv)
the exploration and evaluation tenure right has expired or are expected to expire in the
near future, and is not expected to be renewed.
substantive expenditure on further exploration for and evaluation of mineral resources
in the specific area is neither budgeted nor planned.
exploration for and evaluation of mineral resources in the specific area have not led to
the discovery of commercially viable quantities of mineral resources and the entity has
decided to discontinue such activities in the specific area.
sufficient data exist to indicate that, although a development in the specific area is likely
to proceed, the carrying amount of the exploration and evaluation asset is unlikely to be
recovered in full from successful development or by sale
Proceeds from the sale of exploration permits or recoupment of exploration costs from farming
arrangements are credited against exploration costs previously capitalised. Any excess of the
proceeds overs costs recouped are accounted for as a gain on disposal.
(f)
Revenue recognition
Revenue is recognised to the extent that it is probable that the economic benefits will flow to
the Group and the revenue can be reliably measured. The following specific recognition criteria
must also be met before revenue is recognised:
(i) Interest income
Interest revenue is recognised on a time proportionate basis that takes into account the
effective yield on the financial asset.
(g)
Cash and cash equivalents
Cash comprises cash at bank and in hand. Cash equivalents are short term, highly liquid
investments that are readily convertible to known amounts of cash and which are subject to an
insignificant risk of changes in value. Temporary bank overdrafts are included in cash at bank
and in hand. Permanent bank overdrafts are shown within borrowings in current liabilities in
the statement of financial position.
For the purposes of the statement of cash flows, cash and cash equivalents consist of cash and
cash equivalents as defined above, net of outstanding bank overdrafts.
21
PEAKO LIMITED
ABN 79 131 843 868
Notes to the Financial Statements
for the Year Ended 30 June 2017
Note 1: Statement of significant accounting policies continues
(h)
Income tax
Current tax assets and liabilities are measured at the amount expected to be recovered from
or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are
those that are enacted or substantively enacted by the balance date.
Deferred income tax is provided on all temporary differences at the balance date between the
tax bases of assets and liabilities and their carrying amounts for financial reporting purposes.
Deferred income tax liabilities are recognised for all taxable temporary differences except:
• when the deferred income tax liability arises from the initial recognition of goodwill or
of an asset or liability in a transaction that is not a business combination and that, at the
time of the transaction, affects neither the accounting profit nor taxable profit or loss; or
• when the taxable temporary difference is associated with investments in controlled
entities, associates or interests in joint ventures, and the timing of the reversal of the
temporary difference can be controlled and it is probable that the temporary difference
will not reverse in the foreseeable future.
Deferred income tax assets are recognised for all deductible temporary differences, carry-
forward of unused tax assets and unused tax losses, to the extent that it is probable that
taxable profit will be available against which the deductible temporary differences and the
carry-forward of unused tax credits and unused tax losses can be utilised, except:
• when the deferred income tax asset relating to the deductible temporary difference
arises from the initial recognition of an asset or liability in a transaction that is not a
business combination and, at the time of the transaction, affects neither the accounting
profit nor taxable profit or loss; or
• when the deductible temporary difference is associated with investments in controlled
entities, associates or interests in joint ventures, in which case a deferred tax asset is
only recognised to the extent that it is probable that the temporary difference will
reverse in the foreseeable future and taxable profit will be available against which the
temporary difference can be utilised.
The carrying amount of deferred income tax assets is reviewed at each balance date and
reduced to the extent that it is no longer probable that sufficient taxable profit will be
available to allow all or part of the deferred income tax asset to be utilised.
Unrecognised deferred income tax assets are reassessed at each balance date and are
recognised to the extent that it has become probable that future taxable profit will allow the
deferred tax asset to be recovered.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to
apply to the financial period when the asset is realised or the liability is settled, based on tax
rates (and tax laws) that have been enacted or substantively enacted at the balance date.
Deferred tax assets and deferred tax liabilities are offset only if a legally enforceable right
exists to set off current tax assets against current tax liabilities and the deferred tax assets
and liabilities relate to the same taxable entity and the same taxation authority.
22
PEAKO LIMITED
ABN 79 131 843 868
Notes to the Financial Statements
for the Year Ended 30 June 2017
Note 1: Statement of significant accounting policies continues
(i)
Other taxes
Revenues, expenses and assets are recognised net of the amount of GST except:
• when the GST incurred on a purchase of goods and services is not recoverable from
the taxation authority, in which case the GST is recognised as part of the cost of
acquisition of the asset or as part of the expense item as applicable; and
receivables and payables, which are stated with the amount of GST included.
•
The net amount of GST recoverable from, or payable to, the taxation authority is included as
part of receivables or payables in the statement of financial position.
Cash flows are included in the statement of cash flows on a gross basis and the GST
component of cash flows arising from investing and financing activities, which is
recoverable from, or payable to, the taxation authority, are classified as operating cash
flows.
Commitments and contingencies are disclosed net of the amount of GST recoverable from,
or payable to, the taxation authority.
(j)
Impairment of assets
The carrying amounts of the company’s assets are reviewed at each statement of financial
position date to determine whether there are indicators of impairment. At each reporting
date the company assesses whether there is any indication that individual assets are
impaired. Where impairment indicators exist, recoverable amount is determined and
impairment losses are recognised in profit or loss where the asset's carrying value exceeds
its recoverable amount. Recoverable amount is the higher of an asset's fair value less costs
to sell and value in use. For the purpose of assessing value in use, the estimated future cash
flows are discounted to their present value using a pre-tax discount rate that reflects
current market assessments of the time value of money and the risks specific to the asset.
Due to the uncertainty surrounding each of the interests that Group holds in relation to the
Cadlao development project, The directors have, as a matter of caution, decided to continue
to impair all of the interests associated with Cadlao. As a result, no value is attributed to
those interests, with the assets therefore not included on the Statement of Financial
Position.
(k)
Trade and other payables
Trade payables and other payables are carried at amortised cost and represent liabilities
for goods and services provided to the Group prior to the end of the financial period that
are unpaid and arise when the Group becomes obliged to make future payments in respect
of the purchase of these goods and services.
23
PEAKO LIMITED
ABN 79 131 843 868
Notes to the Financial Statements
for the Year Ended 30 June 2017
Note 1: Statement of significant accounting policies continued
(l)
(m)
(n)
(o)
Provisions
Where applicable, provisions are recognised when the Group has a present obligation (legal
or constructive) as a result of a past event, it is probable that an outflow of resources
embodying economic benefits will be required to settle the obligation and a reliable
estimate can be made of the amount of the obligation.
When the Group expects some or all of a provision to be reimbursed, for example under an
insurance contract, the reimbursement is recognised as a separate asset but only when the
reimbursement is virtually certain. The expense relating to any provision is presented in the
statement of profit or loss and other comprehensive income net of any reimbursement.
If the effect of the time value of money is material, provisions are discounted using a current
pre-tax rate that reflects the risks specific to the liability.
When discounting is used, the increase in the provision due to the passage of time is
recognised as a borrowing cost.
Share-based payment transactions
Equity settled transactions
The fair value of options granted are recognised as an expense with a corresponding
increase in equity. The fair value is measured at grant date and recognised over the period
during which the grantee become unconditionally entitled to the options.
Issued capital
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue
of new shares or options are shown in equity as a deduction, net of tax, from the proceeds.
Earnings per share
Basic earnings per share is calculated as net profit attributable to members of the parent,
adjusted to exclude any costs of servicing equity (other than dividends) and preference
share dividends, divided by the weighted average number of ordinary shares.
(p)
Foreign currency translation
Both the functional and presentation currency of Peako Limited and its Australian
subsidiaries is Australian dollars. Each entity in the Group determines its own functional
currency and items included in the financial statements of each entity are measured using
that functional currency.
Transactions in foreign currencies are initially recorded in the functional currency by
applying the exchange rates ruling at the date of the transaction. Monetary assets and
liabilities denominated in foreign currencies are retranslated at the rate of exchange ruling
at the balance date.
All exchange differences in the consolidated financial report are taken to profit or loss with
the exception of differences on foreign currency borrowings that provide a hedge against a
net investment in a foreign entity. These are taken directly to equity until the disposal of the
net investment, at which time they are recognised in profit or loss.
24
PEAKO LIMITED
ABN 79 131 843 868
Notes to the Financial Statements
for the Year Ended 30 June 2017
Note 1: Statement of significant accounting policies continued
(p) Foreign currency translation (continued)
Tax charges and credits attributable to exchange differences on those borrowings are also
recognised in equity.
Non-monetary items that are measured in terms of historical cost in a foreign currency are
translated using the exchange rate as at the date of the initial transaction. Non-monetary
items measured at fair value in a foreign currency are translated using the exchange rates at
the date when the fair value was determined.
The functional currencies of the foreign operations are not nominated in Australian Dollars.
As at the balance date the assets and liabilities of these subsidiaries are translated into the
presentation currency of Peako Limited at the rate of exchange ruling at the balance date
and their income statements are translated at the weighted average exchange rate for the
year. The exchange differences arising on the translations are taken directly to a separate
component of recognised in the foreign currency translation reserve in equity.
On disposal of a foreign entity, the deferred cumulative amount recognised in equity relating
to that particular foreign operation is recognised in profit or loss.
(q) Trade and other receivables
Trade receivables are initially valued at fair value and then subsequently measured at
amortised cost. Trade receivables on oil and gas sales are due for settlement within 30 days
from the date of the sale. Collectability of trade debtors is reviewed on an on-going
basis. Debts which are known to be uncollectible are written off. A provision for
impairment of trade receivables is established when there is objective evidence that the
Group will not be able to collect all amounts due according to the original terms of the
receivable.
(r) Segment Reporting
Operating segments are reported in a manner that is consistent with the internal reporting
provided to the chief operating decision maker, which has been identified as the Board of
Directors of Peako Limited.
(s) Parent entity financial information
The financial information for the parent entity, Peako Limited, disclosed in Note 15 has been
prepared on the same basis as the consolidated financial statements, except as set out below.
(i) Investments in subsidiaries, associates and joint venture entities
Investments in subsidiaries, associates and joint venture entities are accounted for at cost in
the parent entity’s financial statements. Dividends received from associates are recognised
in the parent entity’s profit or loss, rather than being deducted from the carrying amount of
these investments.
25
PEAKO LIMITED
ABN 79 131 843 868
Notes to the Financial Statements
for the Year Ended 30 June 2017
Note 1: Statement of significant accounting policies continued
(t)
Critical accounting estimates and judgements
Management determine the development, selection and disclosure of the company’s critical
accounting policies and estimates and the application of these policies and estimates. There are
no estimates and judgements that are considered to have a significant risk of causing a material
adjustment to the carrying amounts of assets and liabilities within the next financial year
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions are
recognised in the period in which the estimate is revised if it affects only that period, or in the
period of the revision and future periods if the revision affects both current and future periods
Management exercise judgement as to the recoverability of exploration expenditure. Any
judgement may change as new information becomes available. If, after having capitalised
exploration and evaluation expenditure, management concludes that the capitalised expenditure
is unlikely to be recovered by future sale or exploitation, then the relevant capitalised amount
will be written off through profit or loss and other comprehensive income.
Recovery of deferred tax assets
Significant management judgement is required to determine the amount of deferred tax assets
that can be recognised, based upon the likely timing and the level of future taxable profits.
Currently the Group has not recognised any deferred tax assets in the Statement of Financial
Position.
(u) Financial assets
Financial assets in the scope of AASB 139 Financial Instruments: Recognition and Measurement
are classified as either financial assets at fair value through profit or loss, loans and receivables,
held-to-maturity investments, or available-for-sale investments, as appropriate. When financial
assets are recognised initially, they are measured at fair value plus, in the case of investments not
at fair value through profit or loss, directly attributable transaction costs. The Group determines
the classification of its financial assets after initial recognition and, when allowed and
appropriate, re-evaluates this designation at each financial year-end. All regular way purchases
and sales of financial assets are recognised on the trade date i.e. the date that the Group commits
to purchase the asset. Regular way purchases or sales are purchases or sales of financial assets
under contracts that require delivery of the assets within the period established generally by
regulation or convention in the marketplace.
Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments
that are not quoted in an active market. Such assets are carried at amortised cost using the
effective interest method. Gains and losses are recognised in profit or loss when the loans and
receivables are derecognised or impaired, as well as through the amortisation process.
26
PEAKO LIMITED
ABN 79 131 843 868
Notes to the Financial Statements
for the Year Ended 30 June 2017
Note 1: Statement of significant accounting policies continued
(v) Derecognition of financial assets and financial liabilities
Financial assets
A financial asset (or, where applicable, a part of a financial asset or part of a Group of similar
financial assets) is derecognised when:
•
•
•
the rights to receive cash flows from the asset have expired;
the Group retains the right to receive cash flows from the asset, but has assumed an
obligation to pay them in full without material delay to a third party under a ‘pass-
through’ arrangement; or
the Group has transferred its rights to receive cash flows from the asset and either:
o has transferred substantially all the risks and rewards of the asset, or
o has neither transferred nor retained substantially all the risks and rewards of the
asset, but has transferred control of the asset.
When the Group has transferred its rights to receive cash flows from an asset and has neither
transferred nor retained substantially all the risks and rewards of the asset nor transferred
control of the asset, the asset is recognised to the extent of the Group’s continuing involvement in
the asset. Continuing involvement that takes the form of a guarantee over the transferred asset is
measured at the lower of the original carrying amount of the asset and the maximum amount of
consideration received that the Group could be required to repay.
When continuing involvement takes the form of a written and/or purchased option (including a
cash-settled option or similar provision) on the transferred asset, the extent of the Group’s
continuing involvement is the amount of the transferred asset that the Group may repurchase,
except that in the case of a written put option (including a cash-settled option or similar
provision) on an asset measured at fair value, the extent of the Group’s continuing involvement is
limited to the lower of the fair value of the transferred asset and the option exercise price.
Financial liabilities
A financial liability is derecognised when the obligation under the liability is discharged or
cancelled or expires.
When an existing financial liability is replaced by another from the same lender on substantially
different terms, or the terms of an existing liability are substantially modified, such an exchange
or modification is treated as a derecognition of the original liability and the recognition of a new
liability, and the difference in the respective carrying amounts is recognised in profit or loss.
Note 2: Other Income
Discharge of Octanex Limited loan
Other income
Consolidated
2017
2016
$
$
- 1,284,774
-
827
- 1,285,601
27
PEAKO LIMITED
ABN 79 131 843 868
Notes to the Financial Statements
for the Year Ended 30 June 2017
Note 3: Income tax
Consolidated
2017
$
2016
$
Income tax expense recognised in statement of comprehensive income
Current income tax
Current income tax payable
Deferred income tax
Relating to origination and reversal of temporary differences
Income tax expense
Reconciliation to income tax expense on accounting profit / (loss)
-
-
Accounting (loss) / profit before tax
(178,045)
1,106,957
Tax (benefit) expense at the statutory income tax rate of 30%
(53,414)
332,087
Non-deductible expenses
Non-assessable income
Unrealised tax losses not recognised
Temporary differences not recognised
Income tax expense
Unrecognised deferred tax balances
Deferred tax assets
Tax revenue losses (Australian)
Tax revenue losses (Foreign)
Unamortised business related costs
Accruals & provisions
Deferred tax liabilities:
Exploration expenses
Accrued income
13,844
(32)
65,676
(26,074)
-
5,168
243
(283,766)
(53,732)
-
14,442,926
14,224,008
169,763
64,268
14,300
(8,332)
(45)
169,763
140,103
17,000
-
-
Net unrecognised deferred tax assets
14,682,880
14,550,874
Potential tax benefit @ 30% (2016: 30%)
4,404,864
4,365,262
The deductible temporary differences and tax losses do not expire under current tax legislation.
Deferred tax assets have not been recognised in respect of these items because it is not probable that
future taxable profit will be available against which the Group can utilise the benefits thereof.
28
PEAKO LIMITED
ABN 79 131 843 868
Notes to the Financial Statements
for the Year Ended 30 June 2017
Note 4: Earnings per share
Consolidated
2017
$
2016
$
The profit/(loss) and weighted average number of ordinary shares used in
the calculation of basic and dilutive loss per share is as follows:
Net (loss) / profit for the year
The weighted average number of ordinary shares
(178,045)
51,019,137
1,106,957
36,518,184
Total basic and dilutive (loss) / profit per share (cents)
(0.35)
3.03
Note 5: Trade and other receivables
Current
GST
Other receivables
Non-current
Security deposit
1,742
46
1,788
5,777
5,777
6,218
138
6,356
5,984
5,984
Note 6: Segment information
Segment information is presented using a 'management approach', i.e. segment information is
provided on the same basis as information used for internal reporting purposes by the directors.
At regular intervals, the board is provided management information at a group level for the
company’s cash position, and a company cash forecast for the next twelve months of operation.
On this basis, no segment information is included in these financial statements.
Note 7: Mineral exploration costs
Areas of interest in the exploration and evaluation phase
Balance at the beginning of the year
Costs for the year
Balance at the end of the year
-
8,322
8,322
-
-
-
Peako was granted Exploration Licence E45/3278 by the Western Australian Department of Mines
and Petroleum (DMP) on 30 September 2016.
The recoupment of exploration project acquisition costs carried forward is dependent upon the
recoupment of costs through successful development and commercial exploitation, or alternatively
by sale of the respective areas.
29
PEAKO LIMITED
ABN 79 131 843 868
Notes to the Financial Statements
for the Year Ended 30 June 2017
Note 8: Trade and other payables
Current
Trade and other payables*
Director-related entities – other payables (Note 14)
Other
Consolidated
2017
$
15,952
14,972
-
30,924
2016
$
23,431
17,911
-
41,342
* Trade payables are non-interest bearing and are normally paid on 30 day terms.
Note 9: Issued Capital
As at 30 June 2017 there were 51,019,137 fully paid ordinary shares on issue (2016: 1,020,380,247).
During the year the share capital of the Company was consolidated on a one for twenty basis, making the
company’s share capital more workable and a more attractive investment vehicle. The number of shares
on issue reduced from 1,020,380,247 to 51,019,137
Movement in ordinary share capital
Consolidated
2017
$
2016
$
2017
#
2016
#
At the beginning of the year
Shares issued during the year
Costs associated with share issue
Consolidation
36,808,483
-
36,528,192
343,068
(62,777)
-
1,020,380,247
-
-
(969,361,110)
680,253,247
340,127,000
-
-
At reporting date
36,808,483 36,808,483
51,019,137 1,020,380,247
Ordinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the
Company in proportion to the number of and amounts paid on the shares.
On a show of hands every shareholder 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.
Movement in share options
As at 30 June 2017 5,000,000 options on issue (30 June 2016: 20,000,000). 5,000,000 options exercisable
at $0.04 (4 cents) each, expiring 24 November 2019 were granted to directors at general meeting on 24
November 2016 (refer to Note 11).
20,000,000 options exercisable at $0.28 (28 cents) expired on 25 November 2016.
30
PEAKO LIMITED
ABN 79 131 843 868
Notes to the Financial Statements
for the Year Ended 30 June 2017
Note 10: Reserves
Foreign currency translation reserve (a)
Share compensation reserve (b)
Consolidated
2016
2017
$
$
462
255
1,895,127
33,744
33,999 1,895,589
(a)
(b)
Foreign currency translation reserve
The foreign currency translation reserve represents foreign exchange movements on the translation
of financial statements for controlled entities from the functional currency into the presentation
currency of Australian dollars.
Share compensation reserve
The share compensation reserve is used to record the value of equity benefits provided to employees,
consultants and directors as part of their remuneration.
Note 11: Share based payments
Share options to directors
5,000,000 options exercisable at $0.04 (4 cents) each, expiring 24 November 2019 were granted to
directors at general meeting on 24 November 2016.
The 5,000,000 options granted to directors were valued using the Binomial Option Valuation model.
The following inputs were used:
Exercise price:
Share price at grant date:
Maximum option life
Expected volatility
Risk free interest rate
4.0 cents
2.0 cents
3.0 years
81%
1.55%
Expected volatility was based on the average volatility of a peer group of eleven companies within
the oil and gas exploration industry. The implied volatility of the eleven companies was in the range
of 66% to 95%. The fair value of this share based payment at grant date was $33,744. The options
were fully vested at grant date so a share based payment expense with a corresponding increase in
equity of $33,744 has been recognised for the year ended 30 June 2017.
Note 12: Financial instruments
(a) Capital risk management
Prudent capital risk management implies maintaining sufficient cash and marketable securities to
ensure continuity of tenure to exploration assets and to be able to conduct the Group’s business in an
orderly and professional manner. The Board monitors its future capital requirements on a regular
basis and will when appropriate consider the need for raising additional equity capital, debt funding
or to farm-out exploration projects as a means of preserving capital.
31
PEAKO LIMITED
ABN 79 131 843 868
Notes to the Financial Statements
for the Year Ended 30 June 2017
Note 12: Financial instruments (continued)
(b) Categories of financial instruments
The Group’s principal financial instruments comprise of cash and short-term deposits and short term
borrowings. The main purpose of these financial instruments is to raise finance for the Group’s
operations. The Group has various other financial assets and liabilities such as receivables and trade
payables, which arise directly from its operations. It is, and has been throughout the period under
review, the Group’s policy that no trading in financial instruments shall be undertaken.
(c) Financial risk management objectives
The Group is exposed to market risk (including, interest rate risk and equity price risk), credit risk and
liquidity risk.
The main risks arising from the Group’s financial instruments are interest rate risk and credit risk. The
Board reviews and agrees policies for managing each of these risks and they are summarised below.
(d) Market risk
There has been no change to the Group’s exposure to market risks or the manner in which it manages
and measures the risk from the previous period.
Interest rate risk management
All cash balances attract a floating rate of interest. Excess funds that are not required in the short term
are placed on deposit for a period of no more than 6 months. The Group’s exposure to interest rate risk
and the effective interest rate by maturity periods is set out below.
Interest rate sensitivity analysis
At 30 June 2017, if interest rates had changed on cash and cash equivalent by 100 basis points (1%) and
all other variables were held constant, the Group’s after tax profit would have been $1,126 (2016:
$2,000) lower/higher as a result of higher/lower interest income on cash and cash equivalents.
(e) Credit risk management
Credit risk relates to the risk that counterparties will default on their contractual obligations resulting in
financial loss to the Group. The Group has adopted a policy of only dealing with credit worthy
counterparties and obtaining sufficient collateral or other security where appropriate, as a means of
mitigating the risk of financial loss from any defaults.
(f) Liquidity risk management
Liquidity risk is the risk that the group will not be able to meet its financial obligations as they fall due.
Liquidity risk is monitored to ensure sufficient monies are available to meet contractual obligations as
and when they fall due.
The following are the contractual maturities of the financial liabilities, including interest payments.
Contractual amounts have not been discounted.
32
PEAKO LIMITED
ABN 79 131 843 868
Notes to the Financial Statements
for the Year Ended 30 June 2017
Note 12: Financial instruments (continued)
(f) Liquidity risk management (continued)
Carrying
Amount
Contractual
cash flows
$
$
0-12
month
s
$
1-2 years
2-10
years
$
$
30,924
-
30,924
41,342
-
41,342
30,924 30,924
-
30,924 30,924
-
41,342 41,342
-
41,342 41,342
-
-
-
-
-
-
-
-
-
-
-
-
-
30 June 2017 Consolidated:
Non-derivative Financial Liabilities
Trade and other payables
Non current payables
30 June 2016 Consolidated:
Non-derivative Financial Liabilities
Trade and other payables Borrowings
Non current payables
(g) Foreign currency risk
The Group is exposed to foreign currency risk on sales, purchases and borrowings that are
denominated in a currency other than the respective functional currency. The functional currency of
the group is denominated is Australian dollars.
The Group’s policy is to maintain and hold the sufficient foreign currency to meet its liabilities when
due. Surplus financial assets are transferred and held within Australian dollar currency based
financial products.
Unhedged amounts in respect of cash, receivable and
payable in foreign currency
Cash
Receivables - current
Receivables – non-current
Payables
Consolidated
2016
$
2017
$
-
-
5,777
-
5,777
-
-
5,984
-
5,984
The only foreign currency the Group is currently exposed to is the US dollar. At 30 June 2017 if
AUD:USD rates had changed by +/- 10% and all other variables were held constant, the Group’s after
tax loss would have been $577 (2016: $(598)) higher/ (lower) as a result of lower/higher foreign
exchange translations on cash, receivables and payables.
33
PEAKO LIMITED
ABN 79 131 843 868
Notes to the Financial Statements
for the Year Ended 30 June 2017
Note 13: Commitments for expenditure
Not longer than 1 year
Longer than 1 year and not longer than 5
years
Consolidated
2016
$
2017
$
20,000
60,000
80,000
-
-
-
Expenditure commitments (minerals)
The Group’s interests in minerals tenements are limited to E45 /3278 which has a current year
commitment of $20,000. The permit year ends 29 September each year and currently expires 29
September 2021.
Note 14: Related party disclosure
The ultimate parent entity in the wholly-owned group and the ultimate Australian parent entity is Peako
Limited. The consolidated financial statements include the financial statements of Peako Limited and the
controlled entities listed in the following table:
Name of entity
Country of
incorporation
Class of shares
Equity holding %
2016
2017
Australia
Peak Oil & Gas (Australia) Pty
Ltd
Peak Oil & Gas (Singapore) Pte
Singapore
Ltd
Peak Royalties Ltd
British Virgin Islands
Peak Oil & Gas Philippines Ltd British Virgin Islands
British Virgin Islands
Energy Best Limited
Australia
SA Drilling Pty Ltd
Australia
Samarai Pty Ltd
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
100
100
100
100
100
100
100
100
100
100
100
100
100
100
The transactions between Peako Limited and its controlled entities during this financial year consisted
of loans between Peako Limited and its controlled entities.
Related Parties
The following table provides details of advances to related parties and
outstanding balances at balance date.
Parent entity
2017
$
2016
$
Peak Oil & Gas (Australia) Pty Ltd
SA Drilling Pty Ltd
Samarai Pty Ltd
Impairment of loans to controlled entities
10,420,932
206,356
255,884
(10,883,172)
-
10,874,872
206,356
255,884
(11,337,112)
-
34
PEAKO LIMITED
ABN 79 131 843 868
Notes to the Financial Statements
for the Year Ended 30 June 2017
Note 14: Related party disclosure (continued)
Transactions with Related Parties
Director-related entities
Companies in which a Peako director controls or significantly influences, that provide services to the
company or to a joint operation in which the company has an interest.
(i) During the year services were provided under normal commercial terms and conditions by:
Samika Pty Ltd (Samika), a director-related entity of RL Clark
Exoil Pty Ltd (Exoil), a director-related entity of EG Albers
Natural Resources Group (NRG), a director-related entity of EG Albers
Octanex Limited (Octanex), a director-related entity of EG Albers
The following table provides details of services provided by director-
related entities
Samika - consulting
Exoil – office services
Octanex – accounting and administration support
NRG – underwriting services
The following table provides details of amounts payable to director-
related entities at balance date.
Samika
Exoil
Octanex
2017
$
25,211
33,929
14,590
-
73,730
2016
$
7,290
25,143
7,110
25,510
65,053
-
7,800
7,172
14,972
2,430
7,660
7,821
17,911
35
PEAKO LIMITED
ABN 79 131 843 868
Notes to the Financial Statements
for the Year Ended 30 June 2017
Note 15: Parent Entity Disclosures
Parent Entity
Financial position
Current assets
Non-current assets
Total assets
Current liabilities
Non-current liabilities
Total liabilities
Net Assets
Issued capital
Accumulated losses
Options reserve
Total Equity
Financial performance
(Loss) profit for the year
Other comprehensive income
Total comprehensive loss
2017
$
114,472
8,322
122,794
30,922
-
30,922
91,872
2016
$
277,513
-
277,513
41,340
-
41,340
236,173
58,725,355
(58,667,227)
33,744
91,872
58,725,355
(60,680,608)
2,191,426
236,173
(178,045)
-
(178,045)
1,654,185
-
1,654,185
Note 16: Matters Subsequent to Balance Date
Since the end of the financial year the directors are not aware of any other matter or circumstance not
otherwise dealt with in this report or financial statements that has significantly affected, or may
significantly affect, the operations of the Group, the results of those operations, or the state of affairs of the
Group in future financial years.
Note 17: Contingent Liabilities
Contingent liability of US$2,800,000 (A$3,6,40,146) (2016: A$3,770,536) payable on first two liftings from
Cadlao oil project, provided that the project proceeds, which is uncertain, and provided that Peak Oil & Gas
(Singapore) Pte Ltd retains its economic interest in the Cadlao Project via VenturOil unless it has lost that
interest by virtue of gross negligence .
In lieu of the balance of monies of $1,284,774 owing on the Octanex Limited (“Octanex”) loan, Octanex has
agreed to accept a proceeds sharing arrangement with Peako whereby Octanex will share proportionately
in any proceeds (any economic benefit or entitlement) received by Peako in relation to any of its Cadlao
interests in the period to 26 November 2017 up to a limit of $1,603,683. Peako does not expect to receive
any as such proceeds from the Cadlao project.
36
PEAKO LIMITED
ABN 79 131 843 868
Notes to the Financial Statements
for the Year Ended 30 June 2017
Consolidated
2017
$
2016
$
Note 18: Reconciliation of (loss) / profit after income tax to net cash outflow from operating
activities
Reconciliation of loss from ordinary activities after income tax to net
cash outflow from operating activities
Net (loss) / profit for the year
(178,045)
1,106,957
Depreciation charges
Discharge of loan
Foreign exchange gain
Grant of options
Decrease in trade and other receivables
Decrease in trade and other payables
Net cash outflow from operating activities
Note 19: Auditor’s remuneration
The auditors of the Group are Grant Thornton Audit Pty Ltd.
Ltd.
Assurance services
Grant Thornton Audit Pty Ltd
HLB Mann Judd
Non-Audit services
Grant Thornton Audit Pty Ltd
Total auditors’ remuneration
-
-
23
33,744
4,568
(10,418)
(150,128)
3,578
(1,284,774)
847
-
20,680
(9,660)
(162,372)
25,126
-
32,000
5,500
-
-
25,126
37,500
37
PEAKO LIMITED
ABN 79 131 843 868
Directors’ Declaration
The directors of the company declare that:
The financial statements, comprising the statement of profit or loss and other comprehensive
1.
income, statement of financial position, statement of cash flows, statement of changes in equity, and
accompanying notes, are in accordance with the Corporations Act 2001 and:
(a)
(b)
(c)
comply with Accounting Standards and the Corporations Regulations 2001;
give a true and fair view of the consolidated entity’s financial position as at 30 June
2017 and of its performance for the year ended on that date; and
the financial statements and notes also comply with International Financial Reporting
Standards as disclosed in Note 1(a).
In the directors’ opinion, there are reasonable grounds to believe that the company will be able
2.
to pay its debts as and when they become due and payable.
3.
The remuneration disclosures included in pages 10 to 12 of the directors’ report, (as part of
audited Remuneration Report), for the year ended 30 June 2017, comply with section 300A of the
Corporations Act 2001.
The directors have been given the declarations by the chief executive officer and chief financial
4.
officer required by section 295A.
This declaration is made in accordance with a resolution of the Board of Directors and is signed for
and on behalf of the directors by:
RL Clark
Director
28 September 2017
38
The Rialto, Level 30
525 Collins St
Melbourne Victoria 3000
Correspondence to:
GPO Box 4736
Melbourne Victoria 3001
T +61 3 8320 2222
F +61 3 8320 2200
E info.vic@au.gt.com
W www.grantthornton.com.au
Independent Auditor’s Report
to the Members of Peako Limited
Report on the audit of the financial report
Opinion
We have audited the financial report of Peako Limited (the “Company”) and its subsidiaries (the
“Group”), which comprises the consolidated statement of financial position as at 30 June 2017, the
consolidated statement of profit or loss and other comprehensive income, consolidated statement
of changes in equity and consolidated statement of cash flows for the year then ended, and notes
to the consolidated financial statements, including a summary of significant accounting policies,
and the directors’ declaration.
In our opinion, the accompanying financial report of the Group, is in accordance with the
Corporations Act 2001, including:
a Giving a true and fair view of the Group’s financial position as at 30 June 2017 and of its
performance for the year ended on that date; and
b Complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities
under those standards are further described in the Auditor’s Responsibilities for the Audit of the
Financial Report section of our report. We are independent of the Group in accordance with the
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(a) in the financial statements, which indicates that the Group incurred
a net loss of $178,045 during the year ended 30 June 2017, had net cash outflows for the year of
$158,450 and as of that date, the Group’s remaining cash balance was $112,685 with current
liabilities of $30,924 and net assets of $97,648. As stated in Note 1(a), these events or conditions,
along with other matters as set forth in Note 1(a), indicate that a material uncertainty exists that
may cast doubt on the Group’s ability to continue as a going concern. Our opinion is not modified
in respect of this matter.
Grant Thornton Audit Pty Ltd ACN 130 913 594
a subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389
‘Grant Thornton’ refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory services to their clients and/or refers to one or more member firms, as the
context requires. Grant Thornton Australia Ltd is a member firm of Grant Thornton International Ltd (GTIL). GTIL and the member firms are not a worldwide partnership. GTIL and each member firm
is a separate legal entity. Services are delivered by the member firms. GTIL does not provide services to clients. GTIL and its member firms are not agents of, and do not obligate one another and
are not liable for one another’s acts or omissions. In the Australian context only, the use of the term ‘Grant Thornton’ may refer to Grant Thornton Australia Limited ABN 41 127 556 389 and its
Australian subsidiaries and related entities. GTIL is not an Australian related entity to Grant Thornton Australia Limited.
Liability limited by a scheme approved under Professional Standards Legislation.
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance
in our audit of the financial report of the current period. These matters were addressed in the
context of our audit of the financial report as a whole, and in forming our opinion thereon, and we
do not provide a separate opinion on these matters.
In addition to the matter described in the Material Uncertainty Related to Going Concern section,
we have determined the matters described below to be the key audit matters to be communicated
in our report.
Key audit matter
How our audit addressed the key audit matter
Exploration and Evaluation Assets – valuation
Note 7
At 30 June 2017 the carrying value of Exploration
and Evaluation Assets was $8,322.
In accordance with AASB 6 Exploration for and
Evaluation of Mineral Resources, the company is
required to assess at each reporting date if there are
any triggers for impairment which may suggest the
carrying value is in excess of the recoverable value.
The process undertaken by management to assess
whether there are any impairment triggers in each
area of interest involves an element of management
judgement.
This area is a key audit matter due to the valuation of
exploration and evaluation assets being a significant
risk.
Our procedures included, amongst others:
Obtaining the management prepared reconciliation
of capitalised exploration and evaluation
expenditure and agreeing to the general ledger;
Reviewing management’s area of interest
considerations against AASB 6;
Conducting a detailed review of management’s
assessment of trigger events prepared in
accordance with AASB 6 including;
-
Tracing projects to statutory registers and
exploration licenses to determine whether a
right of tenure existed;
Enquiry of management regarding their
intentions to carry out exploration and
evaluation activity in the relevant exploration
area, including review of managements’
budgeted expenditure;
-
- Understanding whether any data exists to
suggest that the carrying value of these
exploration and evaluation assets are unlikely
to be recovered through development or sale;
Reviewing the appropriateness of the related
disclosures within the financial statements.
Information Other than the Financial Report and Auditor’s Report Thereon
The Directors are responsible for the other information. The other information comprises the
information included in the Group’s annual report for the year ended 30 June 2017, 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 we do not express any
form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard
Responsibilities of the Directors’ for the Financial Report
The Directors of the Company are responsible for the preparation of the financial report that gives
a true and fair view in accordance with Australian Accounting Standards and the Corporations Act
2001 and for such internal control as the Directors determine is necessary to enable the
preparation of the financial report that gives a true and fair view and is free from material
misstatement, whether due to fraud or error.
In preparing the financial report, the Directors are responsible for assessing the 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 have no realistic alternative but to do so.
Auditor’s Responsibilities for the Audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee
that an audit conducted in accordance with 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.
A further description of our responsibilities for the audit of the financial report is located at the
Auditing and Assurance Standards Board website at:
http://www.auasb.gov.au/auditors_responsibilities/ar1.pdf. This description forms part of our
auditor’s report.
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 10 to 12 of the directors’ report for
the year ended 30 June 2017.
In our opinion, the Remuneration Report of Peako Limited, for the year ended 30 June 2017,
complies with section 300A of the Corporations Act 2001.
Responsibilities
The Directors of the Company are responsible for the preparation and presentation of the
Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our
responsibility is to express an opinion on the Remuneration Report, based on our audit conducted
in accordance with Australian Auditing Standards.
GRANT THORNTON AUDIT PTY LTD
Chartered Accountants
A R J Nathanielsz
Partner - Audit & Assurance
Melbourne, 28 September 2017
PEAKO LIMITED
ABN 79 131 843 868
Additional Shareholder Information (unaudited)
The shareholder information set out below was applicable as at 25 September 2017.
A. Distribution of equity securities
Analysis of numbers of equity security holders by size of holding:
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and above
Total
Ordinary shares
237
223
71
155
39
725
There were 647 holders of less than a marketable parcel of ordinary shares.
B. Equity security holders
Twenty largest quoted equity security holders – ordinary shares
Name
Octanex Limited
Hawkestone Resources Pty Ltd
Southern Energy Pty Ltd
Sacrosanct Pty td
500 Custodians Pty Ltd
Sagepark Holdings Pty Ltd
Albers Ernest Geoffrey
Pontia Pty Ltd
Hebei Mining Aust Holding ty Ltdl
Albers Cust Co Pty Ltd
Seaspin Pty Ltd
Auralandia Pty Ltd
Australis Finance Pty Ltd
Trayburn Pty Ltd
Great Missenden Holdings Pty Ltd
Bull Equities Pty Ltd
Pathik Rohitendra
Smedvig Peter
Veblen Grp Pty Ltd
Parfitt Julia Grace
Ordinary Shares
No. held
% of issued
shares
7,122,435
5,689,074
4,783,028
3,900,000
2,800,000
2,141,141
2,100,000
1,886,637
1,387,298
1,100,000
973,976
914,113
914,113
900,000
761,761
750,000
735,804
681,819
632,228
500,000
40,673,427
13.96%
11.15%
9.37%
7.64%
5.49%
4.20%
4.12%
3.70%
2.72%
2.16%
1.91%
1.79%
1.79%
1.76%
1.49%
1.47%
1.44%
1.34%
1.24%
0.98%
79.72%
42
PEAKO LIMITED
ABN 79 131 843 868
C. Substantial holders
Substantial shareholders as disclosed in substantial shareholding notices given to the Company are
as follows:
Octanex Group
Number
Held
30,084,521
Percentage
58.97%
D. Voting rights
The voting rights attaching to each class of equity securities are set out below:
Ordinary shares
On a show of hands every member present at a meeting in person or by proxy shall have one vote and
upon a poll each share shall have one vote.
E. Interests in tenements
Tenement
Granted
E45/3278
Location
Sunday Creek, WA Peako Limited
Registered
Entity Name
Registered
Interest %
100.00
Peako Entity
Peako Limited
Beneficial
Interest %
100.00
Tenement
Application
Location
Registered
Entity Name
Registered
Interest %
Peako Entity
Beneficial
Interest %
E45/3477
E45/3292
E45/3345
Peako Limited
Broadhurst, WA
Mt Seers, WA
Peako Limited
Sunday Creek, WA Peako Limited
100.00
100.00
100.00
Peako Limited
Peako Limited
Peako Limited
100.00
100.00
100.00
43