AnnuAl finAnciAl reportfor the year ended 30 June 2016 Letter from the Chairman
managing DireCtors’ report
DireCtors’ report
auDitor’s inDepenDenCe
DeCLaration
ConsoLiDateD statement of
profit or Loss anD other
Comprehensive inCome
ConsoLiDateD statement of
finanCiaL position
ConsoLiDateD statement of
Changes in equity
ConsoLiDateD statement of
Cash fLows
notes to the ConsoLiDateD
finanCiaL statements
DireCtors’ DeCLaration
inDepenDent auDitor’s report
aDDitionaL asX information
02
03
07
20
21
22
23
24
25
55
56
58
CORPORATE DIRECTORY
Black Rock Mining Limited
ABN: 59 094 551 336
Directors
Stephen Copulos
Chairman Non- Executive
Steven Tambanis
Managing Director
Gabriel Chiappini
Non-Executive Director
Company Secretary
Gabriel Chiappini
Principal Place of business
and Registered Office
Level 1, 35 Havelock Street,
West Perth Western Australia, 6005
Telephone: (+61 8) 9320 7550
Fax: (+61 8) 9320 7501
Website:www.blackrockmining.com.au
Auditor
Deloitte Touche Tohmatsu
Tower 2, Brookfield Place
123 St Georges Terrace
Perth Western Australia, 6000
Telephone: (08) 9365 7000
Fax: (08) 9365 7001
Share Registry
Computershare Investor Services Pty Ltd
Level 11, 172 St Georges Terrace
Perth Western Australia, 6000
Telephone: 1300 787 272
Facsimile: (08) 9323 2033
Email: web.queries@computershare.com.au
Stock Exchange Listing
The Company’s shares are quoted on the Australian
Securities Exchange (ASX) The Home Exchange is Perth.
ASX Codes
BKT - ordinary shares
BKTOC - listed options
BKTOD - listed options
Letter from the Chairman
Dear fellow Black rock
mining shareholders
in my second year as Chairman of
Black rock mining, i am pleased
to report that we have made
significant progress and exceeded
our primary objectives. at the
beginning of last financial year,
we set ourselves two goals:
to enter the raw material supply
chain for the lithium-ion battery
market by finding a quality
resource and to evaluate the
potential for long-term graphite
production. Black rock mining has
achieved extraordinary success
by discovering the largest and
highest grade graphite resource in
tanzania and is currently working
on completing technical and
financial studies on a potential
mine development.
With the upsurge of investment into the electric vehicle and energy storage
market, companies across the globe are increasingly participating into this clean
and sustainable energy storage system. The lithium ion battery has been described
as “the energy of the future”.
The Company has a clear strategy and together with a focused purpose, we were
able to achieve the following material milestones over the course of the last year:
• Doubling of the Graphitic mineralisation footprint – July 2015
• Increase in Exploration Target to 84Mt - 115Mt – October 2015
• Equity raising of $5m at a 50% premium to the prospectus raising
– October 2015
• Divestment of non-core assets resulting in non-dilutive funding – November 2015
• Maiden JORC resource 131Mt at 7.9%. The largest and highest grade resource
in Tanzania and 4th largest contained graphite resource in the World
– February 2016
• Positive Scoping Study – March 2016
• Excellent sector leading metallurgical concentrate purities >99% TGC
– June 2016, subsequently supported with outstanding expandable graphite
test results in August 2016, then in September 2016 demonstrating that
Battery grade spherical graphite can be made from Mahenge Concentrates
• Implementation of an intensive project assessment programme including the
Pre Feasibility Study (‘PFS’), metallurgical studies, product assessment and
graphite concentrate marketing
The Mahenge Project is a World Class graphite resource that can produce high
purity graphite concentrates from a straightforward processing flowsheet.
Extensive testing indicates that high value products can be manufactured from
these Mahenge graphite concentrates. High grades, excellent metallurgical
characteristics, and good mining geometry support indications that a low cost,
long life mining operation is achievable. We look forward to the upcoming PFS
and Definitive Feasbility Study (‘DFS’) to validate this.
We are also excited by the additional resource potential of the Cascades Prospect,
currently being close-spaced drilled with results expected in Q4 2016. The PFS will
be delivered this side of Christmas and the company’s DFS during the first half of
2017. A positive DFS will provide the confidence for the Company to seek and
secure funding for the development of a graphite mine.
I am pleased to report that the market capitalisation of our Company has tripled
since our ASX listing in March 2015 with our share pricing increasing from
$0.05 per share to an all-time trading high of $0.215. Although we are unable
to control the macro factors that influence the trading and commodity markets,
the Board strives to ensure that it extracts maximum value for the funds invested
by shareholders and with board members owning approximately 30% of the
Company, our interests are strongly aligned with shareholders.
I would like to thank our Managing Director, Mr Steven Tambanis and his highly
competent team who have executed the Board’s strategic plan, delivered a
World-Class graphite resource. Steven and the team have worked tirelessly during
the past 12 months, often in difficult and trying conditions. I would also like to
extend my appreciation to fellow director, Mr Gabriel Chiappini in managing our
Investor, Corporate, Financial and Compliance programmes.
Finally, I would like to thank you for your continued support as shareholders of
Black Rock Mining and allowing us to build a focused graphite company that will
provide “the energy of the future” for the benefit of all shareholders.
Yours sincerely
Stephen Copulos
CHAIRMAN
Black Rock Mining liMited2016 AnnuAl report02 Managing
Director’s
Report
TEnuRE SummARY
TEnEMEnT nAME
mahenge north
mahenge southwest
mahenge southeast
makonde
Total Area km2
nuMBER
AREA kM2
PL 7802/2012
PL 10427/2014
PL 10426/2014
PL 10111/2014
144.10
208.67
154.96
24.83
532.56
Black Rock Mining liMited2016 AnnuAl report03 managing DireCtor’s report
the 12 months to 30 June 2016 were
transformational for the Company
with the announcement of the
fourth largest JorC resource in the
world in february 2016, a positive
scoping study in march 2016 and
then significant improvements
in metallurgy to generate sector
leading 99% tgC high purity
graphite concentrates. higher purity
concentrates are expected to
generate price premiums.
The resource of 131.1Mt @7.9% TGC
contains a higher grade portion of
37.6Mt @10.2% TGC and is expected
to be upgraded twice more prior to
the end of 2016, initially from the
Ulanzi infill drill programme and
then from the current Cascades drill
programme, which offers potential
for increased grades.
Investment in generating bulk
quantities of graphite concentrates
has returned excellent results with
confirmation that our concentrates
can make premium expandable and
spherical graphite products. This is
assisting our marketing programmes
to generate offtake agreements.
On behalf of the Board, I would like
to thank our technical teams for the
significant contributions they have
made to the Company this year.
Their persistence and commitment to
excellence have collectively advanced
this project in a short but exciting
18 months from a grassroots
exploration concept into a developing
project with World Class potential.
ExPlORATIOn ACTIvITIES - mAhEngE PROjECT
During the year the Company’s exploration efforts were predominantly focused on
the Mahenge Project; at Epanko North and two significant new discoveries, Ulanzi,
and Cascades. Drilling at Ulanzi and Cascades confirmed large scale graphitic
mineralisation at both localities. Exploration work was also conducted at Kituti and
a small exploration programme was conducted at Bagamoyo.
A positive Scoping Study, announced in March 2016, led to the decision to
commence a Pre Feasibility Study, which is expected to be released in
November 2016.
The discovery of Ulanzi and Cascades in mid 2015 was a catalyst to commence
drilling the well-defined Ulanzi structure and accelerate pit sampling and trenching
at Cascades.
The 2015 drilling programme concluded in December, having completed 7,031m
of RC and 2,491m of diamond core at the four prospects as tabled below:
2015 Calendar year drilling summary
Prospect
Epanko north
Ulanzi
Kituti
Cascades
total metres
RC METRES
DiAMOnD METRES
3420
3212
399
7031
1413
836
243
2491
The 2016 drilling season was focused on infill drilling the Ulanzi prospect to
upgrade the resource classification to Measured and Indicated and to collect
representative core samples for metallurgical testing. 3,000m of RC drilling was
completed at Ulanzi to 30 June 2016.
2016 Drill programme to September – all prospects
Prospect
Ulanzi
Cascades
total metres
RC METRES
DiAMOnD METRES
2916
3442
6358
249
604
853
mETAlluRgICAl TEST
PROgRAmmE SuCCESS
A substantial investment in
metallurgical testing during 2016
resulted in the development of a
straightforward four stage flotation
process that consistently achieved
99% TGC concentrate purities.
Of significance is that these high purity
concentrates could be made from all
portions of mineralised zones: oxide
and fresh zones from Epanko north
and Ulanzi. We believe that this is due
to the uniform or consistent nature of
mineralisation and this has potential to
benefit mineral processing.
Black Rock Mining liMited2016 AnnuAl report04 managing DireCtor’s report
ACTIvITIES SubSEquEnT TO EnD Of fInAnCIAl YEAR
COmmunITY wORk
ulanzi
The Ulanzi infill programme was completed mid July to upgrade the Ulanzi
resource to Measured and Indicated classification. Assay results had been
received by late August and the upgraded resource is expected to be released
by late September 2016.
Cascades
A planned 12 hole drill programme at Cascades in late July revealed that
mineralisation was much wider than expected with zones up to 200m across
strike, together with potential for coarser flake and higher grades.
Cascades is demonstrating potential to be a significant discovery. The drilling
programme was extended with 36 holes drilled by early September with drilling
continuing into October 2016. A preliminary Cascades resource is expected
by November 2016. Diamond core and bulk samples have been collected for
metallurgical testing.
Metallurgical test work
Additional testing of oxide and primary graphitic ore continued to return high
purity concentrate grades. A 40kg sample of 99.2% TGC concentrate was sent
to test facilities and end users for detailed evaluation.
Independent testing of concentrates returned highly positive results:
•
•
In August 2016 an expandable graphite test programme achieved
exceptionally high expansion volumes up to 580x
In September 2016 initial spherical graphite testing confirmed that Mahenge
graphite could make battery grade spherical product with 99.98% TGC
spherical graphite produced from conventional milling, spheronisation and
purification processing.
Metallurgical and product test work continues in Australia, Europe, Japan and USA
to optimise processing flow sheets and provide detailed technical data for graphite
end users.
Capital Raising
The Company has enjoyed working
closely with the local community since
commencing exploration activities at
Mahenge. We employ local people to
assist with exploration work and have
made significant efforts to support
education and local sport. In 2016 the
local football league was sponsored.
ThE nExT 12 mOnThS
The company is committed to
building upon the success of the
past year’s activities.
The main objective over the next
six months is to complete the
Pre Feasibility Studies and then
deliver the Definitive Feasibility
Study in early 2017. The Mahenge
Project has excellent attributes for
a mine development and the and
we have identified and engaged a
multi discipline team to complete
this assessment then commercialise
the project.
Yours sincerely
On 14 September 2016 the company raised A$5.0m through a placement at
A$0.15c per share. Funds raised are for completion of the Cascades drill programme,
and the acceleration of metallurgical and spherical graphite test programmes.
Stephen Tambanis
MANAGING DIRECTOR
Black Rock Mining liMited2016 AnnuAl report05 managing DireCtor’s report
The discovery of Ulanzi and
cascades in mid 2015 was a
caTalysT To commence drilling
The well-defined Ulanzi sTrUcTUre
and acceleraTe piT sampling
and Trenching aT cascades
Black Rock Mining liMited2016 AnnuAl report06 DireCtors’ report
The Directors of Black Rock Mining Limited (“Company” or “Black Rock Mining”)
submit herewith the annual report of the Company and its subsidiary entities for
the financial year ended 30 June 2016. In order to comply with the provisions of
the Corporations Act 2001, the directors report as follows:
InfORmATIOn AbOuT ThE DIRECTORS
The names and details of the Directors of Black Rock Mining Limited during the financial year are:
name
particulars
stephen Copulos
(Chairman)
Mr Copulos is Black Rock Mining Non-Executive Chairman and is the Company’s major shareholder
and financial supporter. Mr Copulos has over thirty years’ experience in a variety of businesses
and investments across a wide range of industries including mining, manufacturing, property
development, food and hospitality. He has been the Managing Director of the Copulos Group of
companies, a private investment group, since 1997 and has extensive experience as a company
director of both listed and unlisted public companies in Australia, the UK and USA.
Mr Copulos held directorships with the following listed companies in the 3 years immediately prior to
the date of this report.
name
Collins Foods Limited
Crusader Resources Limited
Consolidated Zinc Limited
Restaurant Brands Limited
Date appointed
April 2013
March 2013
June 2015
April 2016
Date resigned
October 2014
Current
Current
Current
steven tambanis
(Managing Director)
Mr Tambanis is the Managing Director of Black Rock Mining, with his Executive position being
effective from 1 January 2015. Mr Tambanis is a geologist and manager with extensive commercial
and operation experience gained working with ASX listed mineral companies, including business
development roles at WMC Resources and Goldminex Resources Limited where he held the position
of Executive Director.
He is on the Board of West Africa Gold Limited, an unlisted mineral exploration company. Over the
past three years Mr Tambanis managed all aspects of that company’s exploration activities, operations
and administration, including the execution of a significant joint venture with ASX listed gold miner,
Perseus Mining Limited (ASX: PRU).
name
West African Gold Limited
Date appointed
June 2011
Date resigned
Current
gabriel Chiappini
(Non-Executive
Director and
Company Secretary)
Mr Chiappini is a Chartered Accountant and member of the Australian Institute of Company
Directors with over 20 years’ experience in the commercial sector. Over the last 15 years’ Gabriel has
held positions of Director, Company Secretary and Chief Financial Officer in both public and private
companies with operations in Australia, the United Kingdom and the United States. He has assisted
a number of companies list on the ASX and been involved with equity and debt raisings exceeding
AUD$400 million. Gabriel has a sound understanding of the Australian Stock Exchange (ASX) Listing
Rules and in-depth knowledge of the Corporations Act.
Mr Chiappini currently managers his own consulting firm specialising in providing Director,
company secretarial, corporate governance, compliance and investor relation services. He currently
acts as a Director and Company Secretary for several companies listed on the ASX. Gabriel is
currently Non-Executive Director of Interpose Holdings Limited, Fastbrick Robotics Limited,
Scotgold Resources Limited and Global Geoscience Limited.
Mr Chiappini held directorships with the following listed companies in the 3 year immediately prior
to the date of this report.
name
Fastbrick Robotics Limited
(formally DMY Capital Limited)
- Director
- Non-Executive Chairman 21 March 2012
Date appointed
15 December 2011
Date resigned
Current
18 November 2015
Interpose Holdings Limited
(formerly known as Sunbird Energy Limited)
Scotgold Resources Limited
Global Geoscience Limited
12 August 2015
27 May 2016
3 November 2015
Current
Current
Current
The above named directors held office during the whole of the financial year and since the end of the financial year.
Black Rock Mining liMited2016 AnnuAl report07 DireCtors’ report
PRInCIPAl ACTIvITIES
Black Rock Mining Limited is an Australian based Company listed on the Australian Securities Exchange. The Company owns
graphite tenure in the Mahenge region, Tanzania, a Country that hosts world-class graphite mineralisation.
The Company announced a maiden JORC compliant resource of 131mt @ 7.9% TGC for 10.4m tonnes of contained Graphite
in February 2016, making this one of the largest JORC resources Globally. A positive scoping study in March 2016 led into the
current Pre Feasibility Study which is expected to be released during the December quarter, 2016. The Company intends to
complete a Definitive Feasibility study in March/April 2017.
An infill drill programme for Ulanzi was completed in July 2016 to convert the majority of this resource into Measured and
Indicated Classification. The updated JORC resource for Ulanzi is expected in late September 2016 and a JORC resource
for Cascades is expected in November 2016. The Cascades infill drilling programme has been expanded to incorporate
significantly wider mineralised zones, as reported to ASX on 11 August 2016. The in-fill programme is planned to conclude
in October 2016, with results from the programme flowing shortly thereafter.
REvIEw AnD RESulTS Of OPERATIOnS AnD ACTIvITIES
Results of Operations
The consolidated loss after accounting after tax for the year ended 30 June 2016 was $1,349,305 (2015: $995,121). During 2016,
the Company focused its objectives into developing its graphite assets. Following the transformation into a graphite exploration
company in FY15, the Company successfully achieved the following milestones on our Mahenge Project and corporate activities:
•
Increase in the graphitic mineralisation footprint – announced July 2015
• Exploration Target of 84Mt to 115Mt – announced October 2015
• Equity raising of $5m at a 50% premium to the March 2015 prospectus raising – announced October 2015
• Divestment of non core assets resulting in non dilutive funding
• Maiden JORC resource 131 million tonnes at 7.9% - announced February 2016
• Positive Scoping Study – announced March 2016
• Excellent sector leading metallurgical 99% TGC concentrate purity – announced June 2016.
Corporate and Financial Position
Consolidated net assets at year-end were $10,046,769 against $6,240,669 at the close of the prior year. Total cash held at
year-end was $2,359,185 (2015: $2,489,586).
Exploration Activities
Tanzanian Graphite Assets
As announced to the ASX on 29 February 2016, Black Rock Mining confirmed its maiden JORC resource with the largest and
highest grade graphite resource in Tanzania and the fourth largest globally. The global resource is 131.1Mt @ 7.9% TGC including
37.6Mt @ 10.2% TGC or 16.6Mt @ 11.1% TGC, with 40% of the resource tonnes are in the Indicated Resources Category.
prospect
ulanzi
epanko
Cascade
ComBineD
CATEgORy
TOnnES
(MiLLiOnS)
TgC (%)
COnTAinED TgC
(MiLLiOn TOnnES)
Indicated
Inferred
sub-total
Indicated
Inferred
sub-total
Indicated
Inferred
sub-total
inDiCateD
inferreD
totaL
35.0
45.5
80.5
17.6
20.8
38.4
-
12.3
12.3
52.5
78.6
131.1
8.3
8.7
8.5
6.4
5.9
6.1
-
9.5
9.5
7.7
8.1
7.9
2.9
4.0
6.9
1.1
1.2
2.3
-
1.2
1.2
4.0
6.4
10.4
The Company is now focused on delivering additional high grade measured and indicated resource whilst finalising its feasibility
studies and implementing its marketing programme to deliver offtake supply agreements for its graphite concentrate.
Black Rock Mining liMited2016 AnnuAl report08 DireCtors’ report
DIvIDEnDS
No dividend has been paid since the end of the previous financial year and no dividend is recommended for the current year.
ChAngES In ThE STATE Of AffAIRS
Following on from the transition to a to a graphite resources company in FY15, the Company undertook an exploration
programme at its lead resource prospects Epanko North, Cascades and Ulanzi. During FY16, the Company was able to achieve
the following milestones, which has set the Company on its way to becoming a graphite producer:
• Maiden JORC resource of 131Mt @ 7.9%TGC
• Delivery of a positive scoping study
•
Issue of 66,666,654 shares at $0.075 per share to raise $5m
• Excellent sector leading metallurgical 99% TGC concentrate purity
The Company is planning an infill drilling programme at its Cascades prospect which was recently expanded to incorporate
significantly and wider mineralised zones. The Cascades in-fill programme is planned for October 2016, with results from the
programme flowing shortly thereafter.
SubSEquEnT EvEnTS
During August 2016, the Company announced that it had settled the final milestone payment on its Mahenge North Project.
The final payment of $250,000 was triggered following the Company’s share price exceeding a daily volume weighted average
price (“VWAP”) of $0.10 for 10 consecutive trading days. The payment was made to the vendor of Mahenge North Project
who elected to receive cash of $225,000 and shares worth $25,000 at an issue price of $0.10 each (250,000 ordinary shares).
In August 2016, the Company announced it had reached its final milestone in relation to Tranche C of the Performance
Rights on issue when the Company’s share price exceeded a daily VWAP of $0.1275 for 10 consecutive trading days. The
Performance Rights were converted to 3,899,996 ordinary shares in the Company.
On 26 August 2016, the Company announced that the divestment of the Ocean Hill permit to Eneabba Gas Limited
(“Eneabba Gas”) was completed. As a result of the sale of the permit the Company has been issued with 40 million Eneabba
Gas shares and $200,000 cash consideration, received on 31 August 2016. As part of this divestment and upon satisfaction
by Eneabba Gas of the one last remaining condition precedent, the Company received 7,309,504 fully paid ordinary shares
and 4,651,515 Class B Convertible Redeemable Preference shares in UIL Energy Limited on 20 September 2016.
The 7,309,504 fully paid ordinary shares are held in voluntary escrow for a period of 6 months from issue.
In August 2016 the Company announced that option holders had converted 30,000 options of $0.05 expiring 25 March 2017
and 833,332 options of $0.075 expiring 30 November 2018 to 863,332 ordinary shares.
On 1 September 2016 the Company announced that options holders had converted 300,000 options of $0.05 expiring
25 March 2017 and 33,333 options of $0.075 expiring 30 November 2018 to 333,333 fully paid ordinary shares.
On 20 September 2016 the Company announced that it had finalised a share placement with a total of 33,333,333 shares
issued at $0.15 per share raising $5m (before costs) with the shares placed to institutional and sophisticated investors.
The board of directors have taken up an allocation of 1,500,000 shares totalling $225,000 on the same terms and conditions,
with the allocation subject to shareholder approval, expected to occur at the November 2016 Annual General Meeting.
On 23 September 2016 the Company announced that option holders had converted 500,000 options of $0.075 expiring
30 November 2018 to 400,000 fully paid ordinary shares.
Other than the above, the Directors are not aware of any matter or circumstance that has significantly or may significantly
affect the operation of the Company or the results of those operations, or the state of affairs of the Company in subsequent
financial years.
Black Rock Mining liMited2016 AnnuAl report09 DireCtors’ report
fuTuRE DEvElOPmEnTS
Black Rock Mining Limited is aiming to have its Mahenge Graphite assets in production at the earliest possible opportunity.
This is contingent upon the Company continuing to develop its exploration assets and initiate supply agreements.
The Company owns graphite tenure in the Mahenge region, Tanzania, a Country that hosts world-class graphite
mineralisation. The Company announced a maiden JORC compliant resource of 131mt @ 7.9% TGC for 10.4m tonnes of
contained Graphite in February 2016, making this one of the largest JORC resources Globally. A positive scoping study in
March 2016 led into the current Pre Feasibility Study which is expected to be released in November 2016. The Company
intends to complete a Definitive Feasibility study by March 2017.
An infill drill programme was completed in July 2016 to convert the majority of this resource into Measured and Indicated
Classification. The updated JORC resource for Ulanzi is expected in September 2016 and a JORC resource for Cascades is
expected in November 2016.
Coupled with completion of the updated JORC resource and feasibility studies, the Company is also aiming to finalise a
marketing campaign to initiate offtake supply agreements for its Mahenge concentrate.
EnvIROnmEnTAl REgulATIOn AnD PERfORmAnCE
The exploration activities of entities in the consolidated entity are subject to environmental regulations imposed by various
regulatory authorities, particularly those relating to ground disturbance and the protection of rare and endangered flora and
fauna.
Entities in the consolidated entity have complied with all environmental requirements up to the date of this report.
ShARE OPTIOnS
Share options granted to directors
During the year no share options were granted to the directors of the Company.
Share options on issue
The details of the options as at the date of this report are as follows:
Listed options
Expiring 25 March 2017 at $0.05
Expiring 30 November 2018 at $0.075
unlisted options
Expiring 28 November 2016 at $0.06
Expiring 19 January 2018 at $0.20
CLOSing BALAnCE AT
DATE OF Signing
39,815,000
33,966,656
73,781,656
CLOSing BALAnCE AT
DATE OF Signing
375,000
3,300,003
3,675,003
Option holders do not have any right by virtue of the option to participate in any share issue of the Company or any related
body corporate.
Black Rock Mining liMited2016 AnnuAl report10 DireCtors’ report
PERfORmAnCE RIghTS
Performance rights granted to directors
During and since the end of the financial year, 4,900,000 performance rights were granted to directors of the Company in
November 2015.
Director
Gabriel Chiappini
Stephen Copulos
Steven Tambanis
nO. OF PERFORMAnCE
RighTS gRAnTED
1,475,000
1,475,000
1,950,000
4,900,000
iSSuing EnTiTy
Black Rock Mining
Black Rock Mining
Black Rock Mining
nO. OF ORDinARy ShARES
PER PERFORMAnCE RighTS
1,475,000
1,475,000
1,950,000
4,900,000
For full particulars of performance rights issued to directors as remuneration, refer to the Remuneration Report.
Performance rights on issue
As at the date of this report, no performance rights are on issue.
InfORmATIOn AbOuT ThE DIRECTORS
The following table sets out each Director’s relevant interest in shares or options over shares of the Company as at the date of
this report:
nuMBER OF
ORDinARy
ShARES
nuMBER OF
OPTiOnS
gRAnTED
4,433,333
Director
gabriel Chiappini
- Unlisted Options
- Listed Options
75,000
24 Jan 2013 28 Nov 2016
250,000
27 Mar 2015
25 Mar 2017
$0.06
$0.05
266,666
9 May 2016
30 Nov 2018
$0.075
gRAnT DATE
EXPiRy DATE
EXERCiSE
PRiCE
PERFORMAnCE
RighTS
stephen Copulos
73,530,170
- Unlisted Options
- Listed Options
1,291,080
28 Jul 2014
19 Jan 2018
15,000,000
27 Mar 2015
25 Mar 2017
$0.20
$0.05
6,666,666
9 May 2016
30 Nov 2018
$0.075
steven tambanis
9,086,315
- Listed Options
1,000,000
27 Mar 2015
25 Mar 2017
400,000
9 May 2016
30 Nov 2018
$0.05
$0.075
Nil
Nil
Nil
InDEmnIfICATIOn Of OffICERS AnD AuDITOR
The Company gave indemnity and held the following liability cover in place during the course of the financial year:
1. Agreements to indemnify Mr S Copulos (Non-Executive Chairman), Mr S Tambanis (Managing Director) and Mr G Chiappini
(Non-Executive Director), in respect of any liabilities incurred by them while acting in the normal course of business as a
director of the entity and to insure them against certain risks they are exposed to as directors of the Company.
2. Pursuant to the above the Company has paid premiums to insure the directors and executive management against liabilities
incurred in the conduct of the business of the Company and has provided right of access to the Company records.
3.
In accordance with common commercial practice, the insurance policy prohibits disclosure of the premium and the nature
of the liability insured against.
The Company has not provided any insurance for an auditor of the Company.
Black Rock Mining liMited2016 AnnuAl report11 DireCtors’ report
DIRECTORS’ mEETIngS
The following table sets out the number of Directors’ meetings (including meetings of committees of directors) held during
the financial year and the number of meetings attended by each Director (while they were director or committee member).
During the financial year nine (9) Board meetings were held:
Director
Gabriel Chiappini
Stephen Copulos
Steven Tambanis
nOn-AuDIT SERvICES
nuMBER ELigiBLE TO ATTEnD
nuMBER ATTEnDED
9
9
9
9
9
9
Details of amounts paid or payable to the auditor for non-audit services provided during the year by the auditor are outlined in
note 18 to the financial statements.
The directors are satisfied that the provision of non-audit services, during the previous year, by the auditor (or by another
person or firm on the auditor’s behalf) is compatible with the general standard of independence for auditors imposed by the
Corporations Act 2001.
The Directors are of the opinion that the services as disclosed in note 18 to the financial statements do not compromise the
external auditor’s independence for the following reasons:
• all non-audit services have been reviewed and approved to ensure that they do not impact the integrity and objectivity of
the auditor; and
• none of the services undermine the general principles relating to auditor independence as set out in Code of Conduct
APES 110 ‘Code of Ethics for Professional Accountants’ issued by the Accounting Professional & Ethical Standards Board,
including reviewing or auditing the auditor’s own work, acting in a management or decision-making capacity for the
Company, acting as advocate for the Company or jointly sharing economic risks and rewards.
AuDITOR’S InDEPEnDEnCE DEClARATIOn
The auditor’s independence declaration is included after this report.
PROCEEDIngS On bEhAlf Of ThE COmPAnY
No person has applied for leave of Court to bring proceedings on behalf of the Company or intervene in any proceedings to
which the Company is a party for the purpose of taking responsibility on behalf of the Company for all or any part of those
proceedings. The Company was not party to any such proceedings during the year.
Black Rock Mining liMited2016 AnnuAl report12 DireCtors’ report
REmunERATIOn REPORT
This remuneration report, which forms part of the directors’ report, sets out information about the remuneration of Black
Rock Mining Limited’s key management personnel for the financial year ended 30 June 2016. The term ‘key management
personnel’ refers to those persons having authority and responsibility for planning, directing and controlling the activities of
the consolidated entity, directly or indirectly, including any director (whether executive or otherwise) of the consolidated entity.
The prescribed details for each person covered by this report are detailed below under the following headings:
• key management personnel
•
•
•
remuneration policy
relationship between the remuneration policy and company performance
remuneration of key management personnel
• key terms of employment contracts
key management personnel
The Directors of the consolidated entity during or since the end of the financial year were:
Stephen Copulos
Steven Tambanis
Gabriel Chiappini
(Chairman Non-Executive)
Appointed 22 January 2015
(Managing Director)
Appointed 22 January 2015
(Non-Executive Director)
Appointed 21 March 2012
(Company Secretary)
Appointed 12 July 2013
Except as noted, the named persons held their current positions for the whole of the financial year and since the end of the
financial year.
Remuneration policy
The Board of Directors is responsible for determining and reviewing compensation arrangements for directors and the
executive team. The Board assesses the appropriateness of the nature of the amount of remuneration of such officers on
a periodic basis by reference to relevant employment market conditions with the overall objective of ensuring maximum
stakeholder benefit from the retention of a high quality Board and Executive team and that each staff member’s remuneration
package properly reflects that person’s duties and responsibilities.
The Board may, however, exercise its discretion in relation to approving incentive bonuses, options and performance rights.
Black Rock Mining liMited2016 AnnuAl report13 DireCtors’ report
REmunERATIOn REPORT (COnTInuED)
Elements of director and executive remuneration
Remuneration packages contain the following key elements:
• Short term benefits – salaries / fees
• Annual leave benefits
• Post-employment benefits - superannuation
• Share based payments
No non-monetary short-term benefits, prescribed retirement benefits or other post-employment benefits were paid. The
following table discloses the remuneration of the Directors and executives of the Company:
M
R
E
T
T
R
O
h
S
E
E
y
O
L
P
M
E
-
S
T
i
F
E
n
E
B
S
E
E
F
D
n
A
y
R
A
L
A
S
$
100,000
237,500
66,000
403,500
M
R
E
T
T
R
O
H
S
E
E
Y
O
L
P
M
E
-
I
S
T
F
E
N
E
B
S
E
E
F
D
N
A
Y
R
A
L
A
S
$
41,667
100,000
112,350
28,560
18,384
300,961
)
v
(
R
E
h
T
O
T
n
E
M
y
O
L
P
M
E
-
S
T
i
F
E
n
E
B
T
S
O
P
n
O
i
T
A
u
n
n
A
R
E
P
u
S
$
-
21,164
24,250
-
21,164
24,250
)
v
(
R
E
H
T
O
T
N
E
M
Y
O
L
P
M
E
-
I
S
T
F
E
N
E
B
T
S
O
P
I
N
O
T
A
U
N
N
A
R
E
P
U
S
$
-
7,696
9,500
-
-
1,745
11,245
7,696
D
E
S
A
B
E
R
A
h
S
T
n
E
M
y
A
P
$
L
A
T
O
T
$
118,888
195,279
118,888
433,055
218,888
478,193
184,888
881,969
D
E
S
A
B
E
R
A
H
S
T
N
E
M
Y
A
P
$
9,566
19,134
9,566
-
-
L
A
T
O
T
$
51,233
136,330
121,916
28,560
20,129
38,266
358,168
E
C
n
A
M
R
O
F
R
E
P
O
T
D
E
k
n
i
L
%
54.3%
40.8%
64.3%
E
C
N
A
M
R
O
F
R
E
P
O
T
D
E
k
N
L
I
%
18.7%
14.0%
7.8%
0%
0%
2016
Stephen Copulos
Steven Tambanis (i)
Gabriel Chiappini
2015
Stephen Copulos
Steven Tambanis (i)
Gabriel Chiappini (ii)
Richard Beresford (iii)
Barnaby Egerton-Warburton (iv)
(i) During October 2015 a new employment contract was signed for Mr Tambanis with an annual salary increase to $250,000
per annum (2015: $200,000) plus 10% superannuation (2015: 10%).
(ii) During the year ended 30 June 2015, Mr Chiappini took on an executive role for approximately 9 months to manage and
lead the acquisition of the Graphite Portfolio, finalise the acquisitions, extension of vendor agreements through to 31
March 2015, management of the divestment of the Company’s non-core assets and management of prospectus to raise
$3,500,000. Additional work also included successful ASX re-compliance as a graphite resources company and re-listing
on the ASX on 31 March 2015.
(iii) Mr Richard Beresford resigned as director of the Company 15 April 2015.
(iv) Mr Barnaby Egerton-Warburton resigned as director of the Company 22 January 2015.
(v) Other relates to accrual of annual leave benefits.
Black Rock Mining liMited2016 AnnuAl report14
DireCtors’ report
REmunERATIOn REPORT (COnTInuED)
key Terms of Employment Contracts
The Directors and executive are employed under contracts, which have no fixed term.
The contract binding the Chairman may be terminated by the individual or the Board by giving three months’ notice in writing
to terminate the Consultancy Agreement under which his services are contracted.
The contract binding the Managing Director may be terminated by the individual or the Board by giving six months’ notice in
writing to terminate the Employment Agreement under which his services are contracted.
The Non-Executive Director is bound by contract. The contract of the Non-Executive Director may be terminated at any time by
him by notice in writing or by shareholders acting by majority vote.
Share based payments arrangements
Options
There were no options issued during the year, affecting key management personnel remuneration.
The aggregate number of options lapsed during the financial year, in relation to options granted as remuneration to key
management personnel:
gRAnT DATE
EXPiRy DATE
nO. OF OPTiOnS
Gabriel Chiappini
11 June 2012
11 June 2016
100,000
1. The total value of options granted, exercised and lapsed during the year is calculated based on the following:
•
•
•
Fair value of the option at grant date multiplied by the number of options granted during the year:
Fair value of the option at the time of exercise multiplied by the number of options exercised during the year:
Fair value of the option at the time of lapse multiplied by the number of options lapsed or cancelled during the year
2. The total value of options included in remuneration for the year is calculated in accordance with AASB 2 Share Based
Payments which requires the following:
• The value of options is determined at grant date and is included in remuneration on a proportionate basis from grant
date to vesting date. Where options immediately vest, the full value of the option is recognised in remuneration in the
current year.
3. There are no further service or performance criteria that need to be met in relation to options granted.
The Board as a whole periodically assesses its current levels of remuneration relative to Company performance, future
projections/prospects and funding. The Board adjusts remuneration as necessary taking account of its projections and the
constraints by which it is bound.
Black Rock Mining liMited2016 AnnuAl report15 DireCtors’ report
REmunERATIOn REPORT (COnTInuED)
Performance rights
Performance rights issued to directors in the Financial Year 2016:
The aggregate number of performance rights issued during the year and held directly, indirectly or beneficially by specified
Directors and other key Management Personnel of the Company or their personally related entities are as follows:
S
T
h
g
i
R
F
O
R
E
B
M
u
n
E
C
n
A
M
R
O
F
R
E
P
1,475,000
1,950,000
1,475,000
–
S
T
h
g
i
R
F
O
E
u
L
A
V
E
C
n
A
M
R
O
F
R
E
P
B
&
A
E
h
C
n
A
R
T
$59,000
$78,000
$59,000
–
S
T
h
g
i
R
C
E
h
C
n
A
R
T
F
O
E
u
L
A
V
E
C
n
A
M
R
O
F
R
E
P
$19,470
$25,740
$19,470
Directors
Stephen Copulos
Steven Tambanis
Gabriel Chiappini
PERFORMAnCE RighTS
gRAnT DATE
EXPiRy DATE
S
T
h
g
i
R
A
E
h
C
n
A
R
T
E
C
n
A
M
R
O
F
R
E
P
S
T
h
g
i
R
B
E
h
C
n
A
R
T
E
C
n
A
M
R
O
F
R
E
P
S
T
h
g
i
R
C
E
h
C
n
A
R
T
E
C
n
A
M
R
O
F
R
E
P
491,667
650,000
491,667
491,667
650,000
491,667
491,666
650,000
491,666
FAiR VALuE AT
gRAnT DATE
EXERCiSE PRiCE
Tranche A
Tranche B
Tranche C
30 November 2015
31 December 2018
30 November 2015
31 December 2018
30 November 2015
31 December 2018
$0.060
$0.060
$0.0396
Nil
Nil
NIl
The Performance Rights will vest upon satisfaction of the following milestones:
(i) Tranche A : The Company announces a JORC Code compliant resource of not less than 3,000,000 tonnes of contained
graphite at 8% or more total graphite from its Graphite Projects;
(ii) Tranche B : The Company announces a JORC compliant resource of greater than 4,000,000 tonnes of contained graphite
at 8% or more total graphite contents from its Graphite Projects; and
(iii) Tranche C : From the date of receipt of the Performance Rights, the Company’s 10 day VWAP is equal to or greater than
$0.1275 for a period of 10 consecutive trading days.
In February 2016, the Company announced its maiden JORC resource, which has triggered the satisfaction of vesting
milestones for Tranches A and B of these performance rights (see below).
OPEning
BALAnCE
gRAnTED
in PERiOD
COnVERTED
in PERiOD
EXPiRED
in PERiOD
CLOSing
BALAnCE
nO. OF
ORDinARy
ShARES
iSSuED
AMOunT
PAiD
VALuE OF
ShARES
iSSuED
Tranche A
Tranche B
Tranche C
-
-
-
-
1,633,334
(1,633,334)
1,633,333
(1,633,333)
1,633,333
-
4,900,000
(3,266,667)
-
-
-
-
-
-
1,633,334
1,633,333
1,633,333
-
1,633,333
3,266,667
Nil
Nil
-
Nil
$88,200
$88,200
-
$176,400
In addition during August 2016, the Company vested the remaining Tranche C performance rights following achievement of
the 10 day VWAP milestone. Please refer to the subsequent event note.
Black Rock Mining liMited2016 AnnuAl report16
DireCtors’ report
REmunERATIOn REPORT (COnTInuED)
Share based payments arrangements (continued)
Performance rights (CoNTiNuED)
Performance rights issued to directors in the Financial Year 2015:
The aggregate number of performance rights on issue from prior reporting periods and held directly, indirectly or beneficially
by specified Directors and other key Management Personnel of the Company or their personally related entities are as follows:
S
T
h
g
i
R
F
O
R
E
B
M
u
n
E
C
n
A
M
R
O
F
R
E
P
–
S
T
h
g
i
R
F
O
E
u
L
A
V
E
C
n
A
M
R
O
F
R
E
P
B
&
A
E
h
C
n
A
R
T
–
S
T
h
g
i
R
C
E
h
C
n
A
R
T
F
O
E
u
L
A
V
E
C
n
A
M
R
O
F
R
E
P
S
T
h
g
i
R
A
E
h
C
n
A
R
T
E
C
n
A
M
R
O
F
R
E
P
S
T
h
g
i
R
B
E
h
C
n
A
R
T
E
C
n
A
M
R
O
F
R
E
P
S
T
h
g
i
R
C
E
h
C
n
A
R
T
E
C
n
A
M
R
O
F
R
E
P
1,675,000
$55,833
$21,217
558,334
558,333
558,333
3,350,000
$111,667
$42,433
1,116,667
1,116,667
1,116,666
1,675,000
$55,833
$21,217
558,334
558,333
558,333
Directors
Stephen Copulos
Steven Tambanis
Gabriel Chiappini
PERFORMAnCE RighT
gRAnT DATE
EXPiRy DATE
Tranche A
Tranche B
Tranche C
19 February 2015
31 December 2017
19 February 2015
31 December 2017
19 February 2015
31 December 2017
The Performance Rights will vest upon satisfaction of the following milestones:
FAiR VALuE AT
gRAnT DATE
EXERCiSE PRiCE
$0.050
$0.050
$0.038
Nil
Nil
Nil
(i) Tranche A : The Company announces a JORC Code compliant resource of not less than 1,000,000 tonnes of contained
graphite at 9% or more total graphite content from the Mahenge Projects;
(ii) Tranche B : The Company announces a JORC compliant resource of greater than 2,000,000 tonnes of contained graphite
at 9% or more graphite content from the Mahenge Projects; and
(iii) Tranche C : From the date of receipt of the Performance Rights, the Company’s 10 day VWAP is equal to or greater than
$0.0875 for a period of 10 consecutive trading days.
In February 2016, the Company announced its maiden JORC resource, which has triggered the satisfaction of the vesting
milestones of Tranches A and B of these performance rights (see below).
OPEning
BALAnCE
gRAnTED
in PERiOD
COnVERTED
in PERiOD
EXPiRED
in PERiOD
CLOSing
BALAnCE
nO. OF
ORDinARy
ShARES
iSSuED
AMOunT
PAiD
VALuE OF
ShARES
iSSuED
Tranche A
Tranche B
Tranche C
2,233,333
2,233,334
2,233,333
6,700,000
-
-
-
-
(2,233,333)
(2,233,334)
-
(4,466,667)
-
-
-
-
-
-
2,233,333
2,233,334
2,233,333
-
$Nil
$Nil
-
$120,600
$120,600
-
2,233,333
4,466,667
$Nil
$241,200
In addition during August 2016, the Company vested the remaining Tranche C performance rights following achievement of
the 10 day VWAP milestone. This has been disclosed as a subsequent event.
Other Financial Transactions with key Management Personnel
During the financial year the following amounts were paid to key Management Personnel for services in addition to those
shown elsewhere in this note:
Director
VALuE $
DESCRiPTiOn
Gabriel Chiappini
$84,000
Payments to Laurus Corporate Services for financial services provided during
the reporting period includes but not limited to management of the Company’s
back office, accounting and finance function, investor relations, compliance &
corporate governance and ASX and ASIC requirements.
Black Rock Mining liMited2016 AnnuAl report17
DireCtors’ report
RElATIOnShIP bETwEEn COmPAnY PERfORmAnCE AnD REmunERATIOn POlICY
Remunerations levels are not dependent upon any performance criteria as the nature of the consolidated entity’s operations is
exploration and they are not generating profit.
The table below sets out summary information about the Company’s earnings and movements in shareholder wealth for the
5 years to 30 June 2016:
Revenue ($’s)
Net loss before tax ($’s)
Net loss after tax ($’s)
Share Price at start of year
Share Price at year end
Loss per share
2016
11,602
(1,349,305)
(1,349,305)
$0.028
$0.066
$0.005
2015
2014
2013
2012
80,616
(995,121)
(995,121)
$0.02
$0.03
$0.007
29,681
(2,428,562)
(2,428,562)
$0.02
$0.02
$0.026
33,539
72,263
(6,060,248)
(10,282,213)
(5,970,061)
(9,936,493)
$0.04
$0.02
$0.060
$0.03
$0.04
$0.200
All share price and loss per share disclosures for 2014 – 2012 above are calculated following the 20-for-1-share consolidation during 2015.
Movement in shares
The aggregate number of shares of the Company held directly, indirectly or beneficially by Directors and other Key
Management Personnel of the Company or their personally related entities are as follows:
ordinary shares
2016
1 JuLy 2015
PuRChASES
RECEiVED
On EXERCiSE
OF OPTiOnS/
PERFORMAnCE
RighTS
SALES
OThER
ChAngES
30 JunE 2016
Stephen Copulos
50,046,838
19,333,332
Steven Tambanis
2,000,000
1,686,315
Gabriel Chiappini
650,000
633,333
2,100,002
3,533,334
2,100,002
-
-
-
-
-
-
71,480,172
7,219,649
3,383,335
Movement in unlisted options
The aggregate numbers of unlisted options of the Company held directly, indirectly or beneficially by specified Directors and
other key Management Personnel of the Company or their personally related entities are as follows:
2016
5
1
0
2
y
L
u
J
1
Stephen Copulos
1,291,080
Steven Tambanis
-
Gabriel Chiappini
175,000
Movement in listed options
E
E
R
F
D
E
T
n
A
R
g
i
g
n
h
C
A
T
T
A
S
n
O
i
T
P
O
-
-
-
n
O
i
T
A
R
E
n
u
M
E
R
S
A
D
E
T
n
A
R
g
S
n
O
i
T
P
O
-
-
-
D
E
S
P
A
L
S
n
O
i
T
P
O
-
-
(100,000)
S
E
g
n
A
h
C
R
E
h
T
O
T
A
E
L
B
A
S
i
C
R
E
X
E
6
1
0
2
E
n
u
J
0
3
D
n
A
D
E
T
S
E
V
6
1
0
2
E
n
u
J
0
3
- 1,291,080 1,291,080
-
-
-
-
75,000
75,000
g
n
i
R
u
D
D
E
T
S
E
V
R
A
E
y
E
h
T
-
-
-
The aggregate number of listed options of the Company held directly, indirectly or beneficially by specified Directors and other
key Management Personnel of the Company or their personally related entities are as follows:
2016
1 JuLy 2015
OPTiOnS
gRAnTED FREE
ATTAChing
OPTiOnS
EXERCiSED
SALES
OThER
ChAngES
30 JunE 2016
Stephen Copulos
15,000,000
6,666,666
Steven Tambanis
Gabriel Chiappini
1,000,000
250,000
400,000
266,666
-
-
-
-
-
-
-
-
-
21,666,666
1,400,000
516,666
Black Rock Mining liMited2016 AnnuAl report18
DireCtors’ report
RElATIOnShIP bETwEEn COmPAnY PERfORmAnCE AnD REmunERATIOn POlICY (COnTInuED)
Movement in performance rights
The aggregate number performance rights of the Company held directly, indirectly or beneficially by specified Directors and
other key Management Personnel of the Company or their personally related entities are as follows:
2016
Stephen Copulos
Steven Tambanis
Gabriel Chiappini
1 JuLy 2015
1,675,000
3,350,000
1,675,000
PERFORMAnCE
RighTS
gRAnTED
PERFORMAnCE
RighTS
EXERCiSED
1,475,000
1,950,000
1,475,000
(2,100,002)
(3,533,334)
(2,100,002)
OThER ChAngES
30 JunE 2016
-
-
-
1,049,998
1,766,666
1,049,998
EnD OF REMunERATiOn REPORT
The director’s report is signed in accordance with a resolution of directors made pursuant to s. 298(2) of the Corporations
Act 2001.
On behalf of the Directors.
Stephen Tambanis
DIRECTOR
Perth, 29 September 2016
Black Rock Mining liMited2016 AnnuAl report19 auDitor’s inDepenDenCe DeCLaration
Deloitte Touche Tohmatsu
ABN 74 490 121 060
Tower 2, Brookfield Place
123 St Georges Terrace
Perth WA 6000
GPO Box A46
Perth WA 6837 Australia
Tel: +61 8 9365 7000
Fax: +61 8 9365 7001
www.deloitte.com.au
29 September 2016
The Board of Directors
Black Rock Mining Limited
Level 1, 35 Havelock Street
WEST PERTH WA 6005
Dear Board Members
Black Rock Mining Limited
In accordance with section 307C of the Corporations Act 2001, I am pleased to provide the following
declaration of independence to the directors of Black Rock Mining Limited.
As lead audit partner for the audit of the financial statements of Black Rock Mining Limited for the
financial year ended 30 June 2016, I declare that to the best of my knowledge and belief, there have been
no contraventions of:
(i)
the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
(ii) any applicable code of professional conduct in relation to the audit.
Yours sincerely
DELOITTE TOUCHE TOHMATSU
Ian Skelton
Partner
Chartered Accountants
Liability limited by a scheme approved under Professional Standards Legislation.
Member of Deloitte Touche Tohmatsu Limited 20
Black Rock Mining liMited2016 AnnuAl report20
ConsoLiDateD statement of
profit or Loss anD other Comprehensive inCome
FOR THE YEAR ENDED 30 JUNE 2016
Continuing operations
Interest income
Administration expenses
Employee benefit expense
Consulting expense
Depreciation and amortisation expense
Net Foreign currency exchange differences
Exploration expenditure
Other expenses from ordinary activities
Impairment of property, plant and equipment
Deferred exploration written off
Loss before tax
Income tax benefit
Loss for the year from continuing operations
Discontinued operations
Profit for the year from discontinued operations
Loss for the year
other comprehensive income, net of income tax
items that may be reclassified subsequently to profit or loss:
Foreign currency translation differences for foreign operations
Income tax on other comprehensive income
totaL Comprehensive inCome for the year attriButaBLe to
memBers of BLaCK roCK mining LimiteD
Loss for the year attributable to owners of the Company
Total comprehensive income attributable to the owners of the Company
Loss per share
From continuing and discontinuing operations
Basic and diluted loss per share
From continuing operations
Basic and diluted loss per share
FOR ThE
yEAR EnDED
30/06/2016
FOR THE
YEAR ENDED
30/06/2015
note
$
$
11,602
80,616
(536,278)
(178,959)
(458,488)
-
15,703
-
(160,947)
-
(274,816)
(122,809)
(312,206)
(537,177)
(1,708)
32,091
(51,293)
(42,038)
(1,818)
-
(1,582,183)
(956,342)
-
-
(1,582,183)
(956,342)
232,878
(38,779)
(1,349,305)
(995,121)
(100,623)
-
406
-
(1,449,928)
(994,715)
(1,349,305)
(1,449,928)
(995,121)
(994,715)
($0.0055)
($0.0075)
($0.0064)
($0.0072)
5
6
5
21
21
The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the
accompanying notes.
Black Rock Mining liMited2016 AnnuAl report21 ConsoLiDateD statement of finanCiaL position
AS AT 30 JUNE 2016
assets
Current assets
Cash and bank balances
Trade and other receivables
Assets classified as held for sale
Total current assets
Non-current assets
Exploration & evaluation asset
Property, plant and equipment
Other financial assets
Total non-current assets
total assets
Liabilities
Current liabilities
Trade and other payables
Provisions
Total current liabilities
total liabilities
net assets
equity
Issued capital
Reserves
Accumulated losses
total equity
note
AS AT
30/06/2016
$
AS AT
30/06/2015
$
8
7
10
11
12
2,359,185
2,489,586
24,628
2,383,813
428,462
2,812,275
80,027
2,569,613
412,383
2,981,996
7,639,211
3,404,600
3,887
105,300
-
105,300
7,748,398
3,509,900
10,560,673
6,491,896
485,043
28,861
243,531
7,696
513,904
251,227
513,904
251,227
10,046,769
6,240,669
13
14
15
40,253,116
36,274,617
1,966,504
812,358
(32,172,851)
(30,846,306)
10,046,769
6,240,669
The above consolidated statement of financial position should be read in conjunction with the accompanying notes.
Black Rock Mining liMited2016 AnnuAl report22 ConsoLiDateD statement of Changes in equity
FOR THE YEAR ENDED 30 JUNE 2016
note
ISSUED CAPITAL
ACCUMULATED
LOSSES
SHARE BASED
PAYMENT
RESERVE
FOREIGN
CURRENCY
RESERVE
$
$
$
$
TOTAL
EquiTy
$
Balance as at 1 July 2014
31,311,043
(30,970,308)
1,306,591
(59,063)
1,588,263
Loss for the year
Other comprehensive income
for the year, net of tax
total comprehensive income
for the year
Issue of ordinary shares
Reallocation of option reserve
of free attaching options
Cost of share capital issued
Options expired during the year
Cost of share based payment
Balance at 30 June 2015
Loss for the year
Other comprehensive income
for the year, net of tax
total comprehensive income
for the year
Issue of ordinary shares
Reallocation of option reserve
of free attaching options
Share based payment relating
to capital raising costs
Cost of share capital issued
Issue of shares following vesting
of performance rights
Options expired during the year
Cost of share based payment
Balance at 30 June 2016
-
-
-
(995,121)
-
(995,121)
5,987,628
(645,281)
(378,773)
-
-
-
-
-
-
-
645,281
-
-
-
1,119,123
(1,119,123)
-
38,266
-
(995,121)
406
406
406
(994,715)
-
-
-
-
-
5,987,628
-
(378,773)
-
38,266
13
14
15
13
14
15
36,274,617
(30,846,306)
871,015
(58,657)
6,240,669
-
-
-
(1,349,305)
-
(1,349,305)
5,212,317
(1,198,592)
(68,790)
(387,636)
421,200
-
-
-
-
-
-
22,760
-
-
-
-
-
1,198,592
68,790
-
(421,200)
(22,760)
431,347
-
(1,349,305)
(100,623)
(100,623)
(100,623)
(1,449,928)
-
-
-
-
-
-
5,212,317
-
-
(387,636)
-
-
431,347
40,253,116
(32,172,851)
2,125,784
(159,280)
10,046,769
The above consolidated statement of changes in equity should be read in conjunction with accompanying notes.
Black Rock Mining liMited2016 AnnuAl report23 ConsoLiDateD statement of Cash fLoWs
FOR THE YEAR ENDED 30 JUNE 2016
Cash flow from operating activities
Payments to suppliers and employees
Exploration expenditure
FOR ThE
yEAR EnDED
30/06/2016
FOR THE
YEAR ENDED
30/06/2015
note
$
$
(879,491)
(1,019,776)
-
(75,005)
Net cash flows used in operating activities
8
(879,491)
(1,094,781)
Cash flow from investing activities
Exploration expenditure
Interest received
Payments for property, plant and equipment
Proceeds on sale of investment
Loan repaid/(received) by third party
(4,017,515)
(2,075,394)
11,602
(3,887)
238,450
-
80,873
-
30,000
400,000
Net cash flows used in investing activities
(3,771,350)
(1,564,521)
Cash flows from financing activities
Proceeds from issue of shares and options
Payment of share issue costs
Proceeds from borrowings
Net cash flows provided by financing activities
Net increase/(decrease) in cash held
Cash at the beginning of the financial year
Effect of exchange movement on cash balances
5,000,115
(393,502)
-
3,683,486
(367,253)
1,000,000
4,606,613
4,316,233
(44,228)
1,656,931
2,489,586
(86,173)
801,258
31,397
Cash and cash equivalents at the end of the year
8
2,359,185
2,489,586
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes.
Black Rock Mining liMited2016 AnnuAl report24 notes to the ConsoLiDateD finanCiaL statements
FOR THE YEAR ENDED 30 JUNE 2016
1
APPlICATIOn Of nEw AnD REvISED ACCOunTIng STAnDARDS
1.1 Amendments to AASBs and the new interpretation that are mandatorily effective for the
current year
In the current year, the Group has applied two amendments to AASBs issued by the Australian Accounting Standards
Board (AASB) that are mandatorily effective for an accounting period that begins on or after 1 July 2015, and
therefore relevant for the current year end.
AASB 2015-3 ‘Amendments to Australian Accounting Standards arising from the Withdrawal of
AASB 1031 Materiality’
This amendment completes the withdrawal of references to AASB 1031 in all Australian Accounting Standards and
Interpretations, allowing that standard to effectively be withdrawn.
AASB 2015-4 ‘Amendments to Australian Accounting Standards – Financial Reporting Requirements for
Australian Groups with a Foreign Parent’
The amendments to AASB 128 align the relief available in AASB 10 and AASB 128 in respect of the financial reporting
requirements for Australian groups with a foreign parent. The amendments require that the ultimate Australian entity
shall apply the equity method in accounting for interests in associates and joint ventures if either the entity or the
group is a reporting entity, or both the entity and group are reporting entities.
The application of these amendments does not have any material impact on the disclosures or on the amounts
recognised in the Group’s consolidated financial statements.
1.2
Standards and interpretations in issue not yet adopted
At the date of authorisation of the financial statements, the Standards and Interpretations that were issued but not yet
effective are listed below.
standard/interpretation
EFFECTiVE FOR
AnnuAL REPORTing
PERiODS BEginning
On OR AFTER
EXPECTED TO BE
iniTiALLy APPLiED
in ThE FinAnCiAL
yEAR EnDing
AASB 9 ‘Financial Instruments’, and the relevant amending standards
1 January 2018
30 June 2019
AASB 15 ‘Revenue from Contracts with Customers’, AASB 2014-5
‘Amendments to Australian Accounting Standards arising from AASB
15’, AASB 2015-8 ‘Amendments to Australian Accounting Standards
– Effective date of AASB 15’ and AASB 2016-3 ‘Amendments to
Australian Accounting Standards – Clarification to AASB 15’
AASB 16 ‘Leases
AASB 2014-3 ‘Amendments to Australian Accounting Standards
– Accounting for Acquisitions of Interest in Joint Operations’
AASB 2014-4 ‘Amendments to Australian Accounting Standards
– Clarification of Acceptable Methods of Depreciation
and Amortisation’
‘AASB 2014-9 ‘Amendments to Australian Accounting Standards
– Equity Method in Separate Financial Statements’
AASB 2014-10 ‘Amendments to Australian Accounting Standards
– Sale or Contribution of Assets between an Investor and its
Associate or Joint Venture’, AASB 2015-10 ‘Amendments to
Australian Accounting Standards – Effective Date of Amendments
to AASB 10 and AASB 128’
AASB 2015-1 ‘Amendments to Australian Accounting Standards
– Annual Improvements to Australian Accounting Standards
2012-2014 Cycle’
AASB 2015-2 ‘Amendments to Australian Accounting Standards
– Disclosure Initiative: Amendments to AASB 101’
AASB 2015-5 ‘Amendments to Australian Accounting Standards
– Investment Entities: Applying the Consolidation Exception’
AASB 2016-1 ‘Amendments to Australian Accounting Standards
– Recognition of Deferred Tax Assets for Unrealised Losses’
AASB 2016-2 ‘Amendments to Australian Accounting Standards
– Disclosure Initiative: Amendments to AASB 107’
1 January 2018
1 January 2019
30 June 2019
30 June 2020
1 January 2016
30 June 2017
1 January 2016
30 June 2017
1 January 2016
30 June 2017
1 January 2018
30 June 2019
1 January 2016
30 June 2017
1 January 2016
30 June 2017
1 January 2016
30 June 2017
1 January 2017
30 June 2018
1 January 2017
30 June 2018
Black Rock Mining liMited2016 AnnuAl report25 notes to the ConsoLiDateD finanCiaL statements
FOR THE YEAR ENDED 30 JUNE 2016
1
APPlICATIOn Of nEw AnD REvISED ACCOunTIng STAnDARDS (COnTInuED)
1.2
Standards and interpretations in issue not yet adopted (continued)
At the date of authorisation of the financial statements, the following IASB Standards and IFRIC Interpretations
(for which Australian equivalent Standards and Interpretations have not yet been issued) were on issue but not
yet effective:
standard/interpretation
EFFECTiVE FOR
AnnuAL REPORTing
PERiODS BEginning
On OR AFTER
EXPECTED TO BE
iniTiALLy APPLiED
in ThE FinAnCiAL
yEAR EnDing
Classification and measurement of share based payment transactions
(Amendment to IFRS 2)
1 January 2018
30 June 2019
The impact of these recently issued or amended standards and interpretations have not yet been determined by
the Group.
2
SummARY Of SIgnIfICAnT ACCOunTIng POlICIES
2.1
Statement of compliance
These financial statements are general-purpose financial statements, which have been prepared in accordance
with the Corporations Act 2001, Accounting Standards and Interpretations, and comply with other requirements
of the law.
The financial statements comprise the consolidated financial statements of the Group. For the purposes of preparing
the consolidated financial statements, the Company is a for-profit entity.
Accounting Standards include Australian Accounting Standards. Compliance with Australian Accounting Standards
ensures that the financial statements and notes of the Company and the Group comply with International Financial
Reporting Standards (‘IFRS’).
The financial statements were authorised for issue by the directors on 29 September 2016.
2.2 going Concern
The financial report has been prepared on the going concern basis, which assumes continuity of normal business
activities and the realisation of assets and settlement of liabilities in the ordinary course of business.
The consolidated entity has incurred net losses after taxes of $1,349,305 (30 June 2015: $995,121) and experienced
net cash outflows from operating activities of $879,491 (30 June 2015: $1,094,781) and net cash outflows from
exploration and evaluation expenditure of $4,017,515 (30 June 2015: $2,075,394) for the year ended 30 June 2016.
During the financial year the consolidated entity deployed its working capital into its graphite prospects in Mahenge,
Tanzania, which resulted in the Company announcing its maiden JORC resource in February 2016. The Company
has stated that its FY17 strategic objectives are the delivery of an increased and upgraded JORC resource, release of
its pre-feasibility study, the securing of offtake supply agreements and the delivery of a definitive feasibility study. In
addition the Company plans to continue optimising its metallurgical analysis and testing on its graphite to produce
high quality and high yielding battery grade concentrates.
The Directors have prepared a cash flow forecast modelling the Company’s key objectives, which indicated the
consolidated entity had a requirement for additional capital to invest in the Company’s stated strategic objectives.
In September 2016, the Company completed a share placement of a 33,333,333 shares at $0.15 per share raising
$5m (before costs) with institutional and sophisticated investors. Based on the Group’s expected cash flows this
additional capital is considered sufficient to allow the consolidated entity to continue with its planned expenditure
program over the coming 12 months.
The directors are satisfied the going concern basis of preparation is appropriate. The financial report has therefore
been prepared on the going concern basis.
Black Rock Mining liMited2016 AnnuAl report26 notes to the ConsoLiDateD finanCiaL statements
FOR THE YEAR ENDED 30 JUNE 2016
2
SummARY Of SIgnIfICAnT ACCOunTIng POlICIES (COnTInuED)
2.3
Basis of Preparation
The consolidated financial statements have been prepared on the basis of historical cost, except for certain properties
and financial instruments that are measured at revalued amounts or fair values at the end of each reporting period,
as explained in the accounting policies below.
Historical cost is generally based on the fair values of the consideration given in exchange for goods and services.
All amounts are presented in Australian dollars, unless otherwise noted.
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction
between market participants at the measurement date, regardless of whether that price is directly observable or
estimated using another valuation technique. In estimating the fair value of an asset or a liability, the Group takes into
account the characteristics of the asset or liability if market participants would take those characteristics into account
when pricing the asset or liability at the measurement date. Fair value for measurement and/or disclosure purposes in
these consolidated financial statements is determined on such a basis, except for share-based payment transactions
that are within the scope of AASB 2, leasing transactions that are within the scope of AASB 117, and measurements
that have some similarities to fair value but are not fair value, such as net realisable value in AASB 102 ‘Inventories’
or value in use in AASB 136 ‘Impairment of Assets’.
In addition, for financial reporting purposes, fair value measurements are categorized into Level 1, 2 or 3 based on the
degree to which the inputs to the fair value measurements are observable and the significance of the inputs to the fair
value measurement in its entirety, which are described as follows:
•
•
Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can
access at the measurement date;
Level 2 inputs are inputs, other than quoted prices included in Level 1, that are observable for the asset or liability,
either directly or indirectly; and
•
Level 3 inputs are unobservable inputs for the asset or liability.
The principal accounting policies are set out below.
2.4
Basis of consolidation
The consolidated financial statements incorporate the financial statements of the Company and entities (including
structured entities) controlled by the Company and its subsidiaries. Control is achieved when the Company:
• has power over the investee;
•
is exposed, or has rights, to variable returns from its involvement with the investee; and
• has the ability to use its power to affect its returns.
The Company reassesses 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 listed above.
Consolidation of a subsidiary begins when the Company obtains control over the subsidiary and ceases when the
Company loses control of the subsidiary. Specifically, income and expenses of a subsidiary acquired or disposed of
during the year are included in the consolidated statement of profit or loss and other comprehensive income from
the date the Company gains control until the date when the Company ceases to control the subsidiary.
Profit or loss and each component of other comprehensive income are attributed to the owners of the Company
and to the non-controlling interests. Total comprehensive income of subsidiaries is attributed to the owners of the
Company and to the non-controlling interests even if this results in the non-controlling interests having a deficit
balance.
When necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies
into line with the Group’s accounting policies.
All intragroup assets and liabilities, equity, income, expenses and cash flows relating to transactions between members
of the Group are eliminated in full on consolidation.
Black Rock Mining liMited2016 AnnuAl report27 notes to the ConsoLiDateD finanCiaL statements
FOR THE YEAR ENDED 30 JUNE 2016
2
SummARY Of SIgnIfICAnT ACCOunTIng POlICIES (COnTInuED)
2.5 non-current assets held for sale
Non-current assets and disposal groups are classified as held for sale if their carrying amount will be recovered
principally through a sale transaction rather than through continuing use. This condition is regarded as met only when
the asset (or disposal group) is available for immediate sale in its present condition subject only to terms that are
usual and customary for sales for such asset (or disposal group) and its sale is highly probable. Management must be
committed to the sale, which should be expected to qualify for recognition as a completed sale within one year from
the date of classification.
When the Group is committed to a sale plan involving loss of control of a subsidiary, all of the assets and liabilities
of that subsidiary are classified as held for sale when the criteria described above are met, regardless of whether the
Group will retain a non-controlling interest in its former subsidiary after the sale.
When the Group is committed to a sale plan involving disposal of an investment, or a portion of an investment,
in an associate or joint venture, the investment or the portion of the investment that will be disposed of is classified
as held for sale when the criteria described above are met, and the Group discontinues the use of the equity method
in relation to the portion that is classified a held for sale. Any retained portion of an investment in an associate or a
joint venture that has not been classified as held for sale continues to be accounted for using the equity method.
The Group discontinues the use of the equity method at the time of disposal when the disposal results in the Group
losing significant influence over the associate or joint venture.
After the disposal takes place, the Group accounts for any retained interest in the associate or joint venture in
accordance with AASB 139 unless the retained interest continues to be an associate or a joint venture, in which
case the Group uses the equity method (see the accounting policy regarding investments in associates or joint
ventures above).
Non-current assets and disposal groups classified as held for sale are measured at the lower of cost, their previous
carrying amount and fair value less costs to sell.
2.6
Revenue Recognition
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and
the revenue can be reliably measured. The following specific recognition criteria must also be met before revenue
is recognised:
2.6.1
Interest income
Interest income from a financial asset is recognised when it is probable that the economic benefits will flow to the
Group and the amount of revenue can be measured reliably. Interest income is accrued on a time basis, by reference
to the principal outstanding and at the effective interest rate applicable, which is the rate that exactly discounts
estimated future cash receipts through the expected life of the financial asset to that asset’s net carrying amount on
initial recognition.
2.7
Foreign currencies
The individual financial statements of each group entity are presented in the currency of the primary economic
environment in which the entity operates (its functional currency). For the purpose of the consolidated financial
statements, the results and financial position of each group entity are expressed in Australian dollars (‘$’), which is
the functional currency of the Company and the presentation currency for the consolidated financial statements.
In preparing the financial statements of each individual group entity, transactions in currencies other than the
entity’s functional currency (foreign currencies) are recognised at the rates of exchange prevailing at the dates of the
transactions. At the end of each reporting period, monetary items denominated in foreign currencies are retranslated
at the rates prevailing at that date. Non- monetary items carried at fair value that are denominated in foreign
currencies are retranslated at the rates prevailing at the date when the fair value was determined. Non-monetary items
that are measured in terms of historical cost in a foreign currency are not retranslated.
Exchange differences on monetary items are recognised in profit or loss in the period in which they arise except for:
• exchange differences on foreign currency borrowings relating to assets under construction for future productive
use, which are included in the cost of those assets when they are regarded as an adjustment to interest costs on
those foreign currency borrowings;
• exchange differences on transactions entered into in order to hedge certain foreign currency risks; and
• exchange differences on monetary items receivable from or payable to a foreign operation for which settlement
is neither planned nor likely to occur (therefore forming part of the net investment in the foreign operation),
which are recognised initially in other comprehensive income and reclassified from equity to profit or loss on
repayment of the monetary items.
Black Rock Mining liMited2016 AnnuAl report28 notes to the ConsoLiDateD finanCiaL statements
FOR THE YEAR ENDED 30 JUNE 2016
2
SummARY Of SIgnIfICAnT ACCOunTIng POlICIES (COnTInuED)
2.7
Foreign currencies (continued)
For the purpose of presenting these consolidated financial statements, the assets and liabilities of the Group’s
foreign operations are translated into Australian dollars using exchange rates prevailing at the end of the reporting
period. Income and expense items are translated at the average exchange rates for the period, unless exchange rates
fluctuated significantly during that period, in which case the exchange rates at the dates of the transactions are used.
Exchange differences arising, if any, are recognised in other comprehensive income and accumulated in equity
(and attributed to non-controlling interests as appropriate).
On the disposal of a foreign operation (i.e. a disposal of the Group’s entire interest in a foreign operation, or a disposal
involving loss of control over a subsidiary that includes a foreign operation, or a partial disposal of an interest in a
joint arrangement or an associate that includes a foreign operation of which the retained interest becomes a financial
asset), all of the exchange differences accumulated in equity in respect of that operation attributable to the owners of
the Company are reclassified to profit or loss.
In addition, in relation to a partial disposal of a subsidiary that includes a foreign operation that does not result
in the Group losing control over the subsidiary, the proportionate share of accumulated exchange differences are
re-attributed to non-controlling interests and are not recognised in profit or loss. For all other partial disposals
(i.e. partial disposals of associates or joint arrangements that do not result in the Group losing significant influence
or joint control), the proportionate share of the accumulated exchange differences is reclassified to profit or loss.
Goodwill and fair value adjustments to identifiable assets acquired and liabilities assumed through acquisition of
a foreign operation are treated as assets and liabilities of the foreign operation and translated at the rate of
exchange prevailing at the end of each reporting period. Exchange differences arising are recognised in other
comprehensive income.
2.8
Employee benefits
A liability is recognised for benefits accruing to employees in respect of wages and salaries, annual leave and long
service leave in the period the related service is rendered.
Liabilities recognised in respect of short-term employee benefits, are measured at their nominal values using the
remuneration rate expected to apply at the time of the settlement.
Liabilities recognised in respect of long term benefits are measured as the present value of the estimated future cash
outflows to be made by the Group in respect of services provided by employees up to reporting date.
2.9
Share-based payment transactions
The Company provides benefits to employees and others (i.e. consultants) of the Company in the form of share-based
payment transactions, whereby employees and others render services in exchange for shares or rights over shares
(“Equity-settled transactions”).
There is currently one plan in place to provide these benefits being an Employee Share Option Plan (“ESOP”),
which provides benefits to Directors, senior executives and staff.
The cost of these equity-settled transactions is measured by reference to fair value at the date at which they are
granted. An external valuer using the Black-Scholes model determines the fair value.
In valuing equity-settled transactions, no account is taken of any performance conditions, other than conditions linked
to the price of the shares of Black Rock Mining Limited (“market conditions”).
The cost of equity settled securities 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”).
2.10 Taxation
Income tax expense represents the sum of the tax currently payable and deferred tax.
2.10.1 Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from profit before tax as
reported in the consolidated statement of profit or loss and other comprehensive income because of items of
income or expense that are taxable or deductible in other years and items that are never taxable or deductible.
The Group’s current tax is calculated using tax rates that have been enacted or substantively enacted by the end
of the reporting period.
Black Rock Mining liMited2016 AnnuAl report29 notes to the ConsoLiDateD finanCiaL statements
FOR THE YEAR ENDED 30 JUNE 2016
2
SummARY Of SIgnIfICAnT ACCOunTIng POlICIES (COnTInuED)
2.10 Taxation (continued)
2.10.2 Deferred Tax
Deferred tax is recognised on temporary differences between the carrying amounts of assets and liabilities in the
consolidated financial statements and the corresponding tax bases used in the computation of taxable profit.
Deferred tax liabilities are generally recognised for all taxable temporary differences. Deferred tax assets are generally
recognised for all deductible temporary differences to the extent that it is probable that taxable profits will be available
against which those deductible temporary differences can be utilised. Such deferred tax assets and liabilities are
not recognised if the temporary difference arises from the initial recognition (other than in a business combination)
of assets and liabilities in a transaction that affects neither the taxable profit nor the accounting profit. In addition,
deferred tax liabilities are not recognised if the temporary difference arises from the initial recognition of goodwill.
Deferred tax liabilities are recognised for taxable temporary differences associated with investments in subsidiaries
and associates, and interests in joint ventures, except where the Group is able to control the reversal of the temporary
difference and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred
tax assets arising from deductible temporary differences associated with such investments and interests are only
recognised to the extent that it is probable that there will be sufficient taxable profits against which to utilise the
benefits of the temporary differences and they are expected to reverse in the foreseeable future.
The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent
that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period in which
the liability is settled or the asset realised, based on tax rates (and tax laws) that have been enacted or substantively
enacted by the end of the reporting period. The measurement of deferred tax liabilities and assets reflects the tax
consequences that would follow from the manner in which the Group expects, at the end of the reporting period,
to recover or settle the carrying amount of its assets and liabilities.
Deferred tax liabilities and assets are offset when there is a legally enforceable right to set off current tax assets against
current tax liabilities and when they relate to income taxes levied by the same taxation authority and the Group
intends to settle its current tax assets and liabilities on a net basis.
2.10.3 Current and deferred tax for the year
Current and deferred tax are recognised in profit or loss, except when they relate to items that are recognised in
other comprehensive income or directly in equity, in which case the current and deferred tax are also recognised in
other comprehensive income or directly in equity, respectively. Where current tax or deferred tax arises from the initial
accounting for a business combination, the tax effect is included in the accounting for the business combination.
Black Rock Mining Limited and its wholly owned Australian controlled entities have implemented the tax
consolidation legislation.
The head entity, Black Rock Mining Limited, and the controlled entities in the tax-consolidation group account for their
own current and deferred tax amounts. These tax amounts are measured as if each entity in the tax-consolidation
group continues to be a stand-alone entity in its own right.
In addition to its own current and deferred tax amounts, Black Rock Mining Limited also recognises the current tax
liabilities (or assets) and the deferred tax assets arising from unused tax losses and unused tax credits assumed from
controlled entities in the tax-consolidation group.
2.11 Property, Plant and Equipment
Each class of plant and equipment is carried at cost or fair value less, where applicable, any accumulated depreciation
and impairment losses.
Plant and equipment
Plant and equipment is stated at cost less accumulated depreciation and any impairment in value.
The carrying values of plant and equipment are reviewed for impairment when events or changes in circumstances
indicate the carrying value may not be recoverable. For an asset that does not generate largely independent cash
inflows, the recoverable amount is determined for the cash-generating unit to which the asset belongs. If any such
indication exists where the carrying values exceed the estimated recoverable amount, the assets or cash generating
units are written down to their recoverable amount.
Depreciation
Depreciable non-current assets are depreciated over their expected economic life using the straight-line method.
Profits and losses on disposal of non-current assets are taken into account in determining the operating loss for
the year. The depreciation rate used for each class of assets is as follows:
Plant and equipment: 7.5% - 40%
Black Rock Mining liMited2016 AnnuAl report30
notes to the ConsoLiDateD finanCiaL statements
FOR THE YEAR ENDED 30 JUNE 2016
2
SummARY Of SIgnIfICAnT ACCOunTIng POlICIES (COnTInuED)
2.12 Exploration Expenditure
Exploration, evaluation and development expenditure incurred is accumulated in respect of each identifiable area
of interest. These costs are only carried forward to the extent that they are expected to be recouped through the
successful development of the area or where activities in the area have not yet reached a stage that permits reasonable
assessment of the existence of economically recoverable reserves, otherwise costs are expensed.
Accumulated costs in relation to an abandoned area are written off in full against profit in the year in which the
decision to abandon the area is made.
When production commences, the accumulated costs for the relevant area of interest are amortised over the life of
the area according to the rate of depletion of the economically recoverable reserves.
A regular review is undertaken of each area of interest to determine the appropriateness of continuing to carry
forward costs in relation to that area of interest.
Costs of site restoration are provided over the life of the facility from when exploration commences and are included
in the costs of that stage. Site restoration costs include the dismantling and removal of mining plant, equipment
and building structures, waste removal, and rehabilitation of the site in accordance with clauses of the permits.
Such costs have been determined using estimates of future costs, current legal requirements and technology on a
discounted basis.
Any changes in the estimates for the costs are accounted on a prospective basis. In determining the costs of site
restoration, there is uncertainty regarding the nature and extent of the restoration due to community expectations
and future legislation. Accordingly the costs have been determined on the basis that the restoration will be completed
within one year of abandoning the site.
2.13
impairment of tangible and intangible assets other than goodwill
At the end of each reporting period, the Group reviews the carrying amounts of its tangible and intangible assets to
determine whether there is any indication that those assets have suffered an impairment loss. If any such indication
exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss
(if any). When it is not possible to estimate the recoverable amount of an individual asset, the Group estimates the
recoverable amount of the cash-generating unit to which the asset belongs. When a reasonable and consistent basis
of allocation can be identified, corporate assets are also allocated to individual cash-generating units, or otherwise
they are allocated to the smallest group of cash-generating units for which a reasonable and consistent allocation basis
can be identified.
Intangible assets with indefinite useful lives and intangible assets not yet available for use are tested for impairment at
least annually, and whenever there is an indication that the asset may be impaired.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the
estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current
market assessments of the time value of money and the risks specific to the asset for which the estimates of future
cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the
carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is
recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the
impairment loss is treated as a revaluation decrease.
When an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is
increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not
exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset
(or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss,
unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as
a revaluation increase.
2.14 Financial instruments
Financial assets and financial liabilities are recognised when a group entity becomes a party to the contractual
provisions of the instrument.
Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable
to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities
at fair value through profit or loss) are added to or deducted from the fair value of the financial assets or financial
liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial
assets or financial liabilities at fair value through profit or loss are recognised immediately in profit or loss.
Black Rock Mining liMited2016 AnnuAl report31 notes to the ConsoLiDateD finanCiaL statements
FOR THE YEAR ENDED 30 JUNE 2016
2
SummARY Of SIgnIfICAnT ACCOunTIng POlICIES (COnTInuED)
2.14 Financial instruments (continued)
2.14.1 Financial Assets
Financial assets are classified into the following specified categories, financial assets ‘at fair value through profit or
loss’ (FVTPL), ‘held to maturity’ investments, ‘available-for-sale’ (AFS) financial assets and ‘loans and receivables’.
The classification depends on the nature and purpose of the financial assets and is determined at the time of initial
recognition. All regular way purchases or sales of financial assets are recognised and derecognised on a trade date
basis. Regular way purchases or sales are purchases or sales of financial assets that require delivery of assets within
the time frame established by regulation or convention in the marketplace.
2.14.1.1 Effective interest method
The effective interest method is a method of calculating the amortised cost of a debt instrument and of allocating
interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future
cash receipts (including all fees on points paid or received that form an integral part of the effective interest rate,
transaction costs and other premiums or discounts) through the expected life of the debt instrument, or (where
appropriate) a shorter period, to the net carrying amount on initial recognition.
Income is recognised on an effective interest basis for debt instruments other than those financial assets classified
as at FVTPL.
2.14.1.2 Loans and receivables
Trade receivables, loans and other receivables that have fixed or determinable payments that are not quoted in an
active market are classified as ‘loans and receivables’. Loans and receivables are measured at amortised cost using the
effective interest method, less any impairment. Interest income is recognised by applying the interest rate, except for
short-term receivables when the effect of discounting is immaterial.
2.14.1.3 impairment of financial assets
Financial assets, other than those at FVTPL, are assessed for indicators of impairment at the end of each reporting
period. Financial assets are considered to be impaired when there is objective evidence that, as a result of one or
more events that occurred after the initial recognition of the financial asset, the estimated future cash flows of the
investment have been affected.
For certain categories of financial assets, such as trade receivables, assets that are assessed for impairment on a
collective basis even if they were assessed not to be impaired individually. Objective evidence of impairment for a
portfolio of receivables could include the Group’s past experience of collecting payments, an increase in the number of
delayed payments in the portfolio past the average credit period of 60 days, as well as observable changes in national
or local economic conditions that correlate with default on receivables.
For financial assets carried at amortised cost, the amount of the impairment loss recognised is the difference between
the asset’s carrying amount and the present value of estimated future cash flows, discounted at the financial asset’s
original effective interest rate.
For financial assets that are carried at cost, the amount of the impairment loss is measured as the difference between
the asset’s carrying amount and the present value of the estimated future cash flows discounted at the current market
rate of return for a similar financial asset. Such impairment loss will not be reversed in subsequent periods.
The carrying amount of the financial asset is reduced by the impairment loss directly for all financial assets with the
exception of trade receivables, where the carrying amount is reduced through the use of an allowance account.
When a trade receivable is considered uncollectible, it is written off against the allowance account. Subsequent
recoveries of amounts previously written off are credited against the allowance account. Changes in the carrying
amount of the allowance account are recognised in profit or loss.
For financial assets measured at amortised cost, if, in a subsequent period, the amount of the impairment loss
decreases and the decrease can be related objectively to an event occurring after the impairment was recognised,
the previously recognised impairment loss is reversed through profit or loss to the extent that the carrying amount
of the investment at the date the impairment is reversed does not exceed what the amortised cost would have been
had the impairment not been recognised.
Black Rock Mining liMited2016 AnnuAl report32 notes to the ConsoLiDateD finanCiaL statements
FOR THE YEAR ENDED 30 JUNE 2016
2
SummARY Of SIgnIfICAnT ACCOunTIng POlICIES (COnTInuED)
2.14 Financial instruments (continued)
2.14.1 Financial Assets (CoNTiNuED)
2.14.1.4 Derecognition of financial assets
The Group derecognises a financial asset when the contractual rights to the cash flows from the asset expire,
or when it transfers the financial asset and substantially all the risks and rewards of ownership of the asset to another
party. If the Group neither transfers nor retains substantially all the risks and rewards of ownership and continues
to control the transferred asset, the Group recognises its retained interest in the asset and an associated liability for
amounts it may have to pay. If the Group retains substantially all the risks and rewards of ownership of a transferred
financial asset, the Group continues to recognise the financial asset and also recognises a collateralised borrowing for
the proceeds received.
On derecognition of a financial asset in its entirety, the difference between the asset’s carrying amount and the
sum of the consideration received and receivable and the cumulative gain or loss that had been recognised in other
comprehensive income and accumulated in equity is recognised in profit or loss.
On derecognition of a financial asset other than in its entirety (e.g. when the Group retains an option to repurchase
part of a transferred asset), the Group allocates the previous carrying amount of the financial asset between the part it
continues to recognise under continuing involvement, and the part it no longer recognises on the basis of the relative
fair values of those parts on the date of the transfer. The difference between the carrying amount allocated to the
part that is no longer recognised and the sum of the consideration received for the part no longer recognised and any
cumulative gain or loss allocated to it that had been recognised in other comprehensive income is recognised in profit
or loss. A cumulative gain or loss that had been recognised in other comprehensive income is allocated between the
part that continues to be recognised and the part that is no longer recognised on the basis of the relative fair values of
those parts.
2.14.2 Financial liabilities
Financial liabilities are classified as either financial liabilities or ‘FVTPL’ or ‘other financial liabilities’.
2.14.2.1 other financial liabilities
Other financial liabilities, including borrowings and trade and other payables, are initially measured at fair value,
net of transaction costs.
Other financial liabilities are subsequently measured at amortised cost using the effective interest method,
with interest expense recognised on an effective yield basis.
The effective interest method is a method of calculating the amortised cost of a financial liability and of allocating
interest expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future
cash payments through the expected life of the financial liability, or (where appropriate) a shorter period, to the net
carrying amount on initial recognition.
2.14.2.2 Derecognition of financial liabilities
The Group derecognises financial liabilities when, and only when, the Group’s obligations are discharged, cancelled or
have expired. The difference between the carrying amount of the financial liability derecognised and the consideration
paid and payable is recognised in profit or loss.
2.15 goods and Services Tax
Revenues, expenses and assets are recognised net of the amount of goods and services tax (“GST”), except:
i. where the amount of GST incurred is not recoverable from the taxation authority, it is recognised as part of the
cost of acquisition of the asset or as part of an item of the expense.
ii.
for receivables and payables which are recognised inclusive of GST.
The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables
or payables.
Cash flows are included in the cash flow statement on a gross basis. The GST component of cash flows arising from
investing and financing activities, which is recoverable from, or payable to, the taxation authority is classified within
operating cash flows.
Black Rock Mining liMited2016 AnnuAl report33 notes to the ConsoLiDateD finanCiaL statements
FOR THE YEAR ENDED 30 JUNE 2016
3
CRITICAl ACCOunTIng juDgEmEnTS In APPlYIng ACCOunTIng POlICIES
In the application of the Group’s accounting policies, which are described in note 2, the directors of the Company are
required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are
not readily apparent from other sources. The estimates and associated assumptions are based on historical experience
and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are
recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the
revision and future periods if the revision affects both current and future periods.
3.1
Critical judgements in applying accounting policies
The following are the critical judgements, apart from those involving estimations, that the directors have made in
the process of applying the Group’s accounting policies and that have the most significant effect on the amounts
recognised in the consolidated financial statements.
3.1.1 Classification and measurement of assets held for sale
Note 7 details that the consolidated entity entered into the binding agreement for the sale of its Ocean Hill
Hydrocarbon Assets. As at 30 June 2016, the sale had not yet complete at reporting date, however the directors have
assessed that the asset will be classified as held for sale and measured at lower of its carrying value and fair value less
cost to sell as the sale of the asset is still highly probable.
3.2
key sources of estimation uncertainty
The following are the key assumptions concerning the future, and other key sources of estimation uncertainty at the
end of the reporting period that have a significant risk of causing a material adjustment to the carrying amounts of
assets and liabilities within the next financial year.
3.2.1
Impairment
The consolidated entities assess impairment at each reporting date by evaluating conditions specific to the
consolidated entities that may lead to impairment of assets. Where an impairment trigger exists, the recoverable
amount of the asset is determined. The Group’s policy on the capitalisation of exploration and evaluation expenditure
is detailed in note 2.12 and Impairment at note 2.13. In considering if an impairment event has been triggered the
Company took into account positive results from its exploration programme, expectation of a near term JORC resource
and market capitalisation being well in excess of capitalised exploration costs.
3.2.2 Share based payments
The consolidated entities measure 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 using the Black Scholes
model. One of the inputs into the option valuation model is volatility of the underlying share price, which is estimated
on the one-year history of the share price and has been estimated as approximately 80% to 122%.
4
SEgmEnT REPORTIng
Information reported to the chief operating decision maker (CODM) for the purpose of resource allocation and
assessment of segment performance focuses on the geographical location of resources being explored for and
evaluated. During the prior reporting period, the consolidated group changed its principal activity and focus to that
of Graphite in Tanzania. It’s geothermal and hydrocarbon activities in Hungary and Australia continue to be
discontinued operations.
Black Rock Mining liMited2016 AnnuAl report34 notes to the ConsoLiDateD finanCiaL statements
FOR THE YEAR ENDED 30 JUNE 2016
4
SEgmEnT REPORTIng (COnTInuED)
4.1
Segment revenues and results
2016
Interest
Total revenue
gRAPhiTE
CORPORATE
COnSOLiDATED
-
-
11,602
11,602
11,602
11,602
Loss before tax (continuing operations)
(376,197)
(1,205,986)
(1,582,183)
Fixed asset additions
Depreciation
Impairment
-
-
274,816
3,887
-
-
3,887
-
274,816
2016
gRAPhiTE
CORPORATE
FROM
DiSCOnTinuing
OPERATiOnS
COnSOLiDATED
Total segment assets
Total segment liabilities
7,641,555
411,560
2,386,140
97,434
532,978
10,560,673
4,910
513,904
2015
Interest
Total revenue
GRAPHITE
CORPORATE
CONSOLIDATED
-
-
80,616
80,616
80,616
80,616
Loss before tax (continuing operations)
(133,011)
(823,331)
(956,342)
Fixed asset additions
Depreciation
Impairment
-
-
-
-
1,708
1,817
-
1,708
1,817
2015
GRAPHITE
CORPORATE
FROM
DISCONTINUING
OPERATIONS
CONSOLIDATED
Total segment assets
Total segment liabilities
3,404,599
2,565,139
191,086
56,961
522,158
3,180
6,491,896
251,227
4.2 geographical segments
2016
TAnzAniA
AuSTRALiA
hungARy
(DiSCOnTinuED)
AuSTRALiA
(DiSCOnTinuED)
COnSOLiDATED
Interest
Total revenue
Non-current
assets
-
-
11,602
11,602
7,639,211
3,887
-
-
-
-
-
11,602
11,602
105,300
7,748,398
2015
TANZANIA
AUSTRALIA
HUNGARY
(DISCONTINUED)
AUSTRALIA
(DISCONTINUED)
CONSOLIDATED
Interest
Total revenue
Non-current
assets
-
-
80,616
80,616
3,404,600
-
-
-
-
80,616
80,616
105,300
3,509,900
Black Rock Mining liMited2016 AnnuAl report35 notes to the ConsoLiDateD finanCiaL statements
FOR THE YEAR ENDED 30 JUNE 2016
5
InCOmE TAxES RElATIng TO COnTInuIng OPERATIOnS
(a) income tax (benefit)/expense
Current tax
Deferred tax
FOR ThE
yEAR EnDED
30/06/2016
FOR THE
YEAR ENDED
30/06/2015
$
-
-
-
$
-
-
-
(b) numerical reconciliation of income tax expense to prima
facie tax payable
Loss from continuing operations
(1,582,183)
(956,342)
Prima facia tax benefit at 30% (2015: 30%)
Share based payments
Non-deductible expenditure
Movement in unrecognised temporary differences
Unused tax losses for which no deferred tax asset has been recognised
Income tax benefit
(c) Recognised deferred tax assets and liabilities
Recognised deferred tax assets comprise:
Other temporary differences
Tax losses available for offset against future taxable income
Deferred tax assets on temporary differences not recognised
recognised deferred tax liabilities comprise:
Unrealised foreign exchange movements
(474,655)
130,551
86,452
38,839
218,813
-
202,403
(198,062)
4,341
4,341
4,341
(286,903)
11,480
3,325
(291,636)
563,734
-
45,310
-
(35,891)
9,419
9,419
9,419
unrecognised deferred tax assets
Unused tax losses for which no deferred tax asset has been recognised are $16,829,644 (2015: $16,345,889).
Potential tax benefit is $5,048,893 (2015: $4,903,767). The Company is still in the process of reviewing the continuity
of ownership test and same business test in determining whether these unrecognised tax losses can be utilised in
future financial reporting periods.
(d) franking credits
The Company has no franking credits available as at 30 June 2016 (2015: Nil).
(e) tax consolidation
The Company and its wholly owned Australian resident entities have formed a tax-consolidated group with effect from
1 July 2004 and are therefore taxed as a single entity from that date. The head Company of the consolidated group is
Black Rock Mining Limited.
Black Rock Mining liMited2016 AnnuAl report36
notes to the ConsoLiDateD finanCiaL statements
FOR THE YEAR ENDED 30 JUNE 2016
6
DISCOnTInuED OPERATIOnS
6.1 Disposal of oil and gas permit
On 22 October 2014, the consolidated group announced that it had entered into an binding agreement to divest its
Ocean Hill Hydrocarbon asset. The conditions precedent on the sale of the Ocean Hill Permit to Eneabba Gas are yet
to be completed as at 30 June 2016. The disposal represents the final oil and gas asset held by the Company. Refer to
Note 7 for further details.
6.2 Disposal of the geothermal business
On 4 December 2015, the Company announced that it had completed the sale of its share of the geothermal assets
held in Central European Energy Private Company Limited (“CEGE”) for HUF 50,000,000. The Company has shown a
profit on sale of the CEGE asset of $238,450.
6.3 Analysis of profit for the year from discontinued operations
The combined results of the discontinued operations (i.e. hydrocarbon and geothermal) included in the profit/(loss)
for the year are set out below. The comparative profit/(loss) and cash flows from discontinued operations have been
re-presented to include those operations classified as discontinued in the current year.
Loss for the year from discontinued operations
Revenue
Administration expense
Consulting expense
Exploration expenditure
Net foreign exchange loss
Gain on disposal of interest in former associate
Profit / (Loss) for the year from discontinued operations (attributable to
owners of the Company)
Cash flows from discontinued operations
Net cash inflows/(outflows) from operating activities
Net cash inflows/(outflows) from investing activities
Net cash inflows/(outflows) from financing activities
FOR ThE
yEAR EnDED
30/06/2016
$
-
(2,080)
(2,241)
-
(1,251)
238,450
FOR THE
YEAR ENDED
30/06/2015
$
258
(6,192)
(8,439)
(23,712)
(694)
-
232,878
(38,779)
FOR ThE
yEAR EnDED
30/06/2016
FOR THE
YEAR ENDED
30/06/2015
$
$
(1,105)
222,371
-
(1,066)
(77,929)
-
221,266
(78,995)
Black Rock Mining liMited2016 AnnuAl report37 notes to the ConsoLiDateD finanCiaL statements
FOR THE YEAR ENDED 30 JUNE 2016
7
ASSETS ClASSIfIED AS hElD fOR SAlE
Ocean Hill Hydrocarbon
FOR ThE
yEAR EnDED
30/06/2016
FOR THE
YEAR ENDED
30/06/2015
$
$
428,462
428,462
412,383
412,383
On 26 August 2016, the Company announced that the divestment of the Ocean Hill permit to Eneabba Gas Limited
(“Eneabba Gas”) was completed. The contracted consideration from the sale consists of a combination of cash
shares in Eneabba Gas and payment of costs on behalf of the Company. The breakdown of the consideration amount
is as follows:
• Upfront payment of $30,000 on signing of the binding agreement (received during the year ended 2015);
• Cash payment of $200,000 (reduced from the previously agreed amount of $300,000); and
• 40,000,000 Eneabba Gas Ordinary Shares.
The Agreement is subject to the following conditions precedent and at reporting date all of the conditions had been
satisfied following the extension that was granted to October 2016:
• Execution of the Amangu Native Title Claimants of the Amangu Native Title Agreement to the satisfaction of
Eneabba Gas (completed in November 2015);
• All conditions required by the Department of Minerals and Petroleum being met to enable the grant of the Permit
(completed in May 2016); and
• Obtaining any consent or approval (including any consent or approval under the Act) required to transfer the
Permit from the Vendor to Eneabba Gas or its newly incorporated subsidiary, Ocean Hill Pty Ltd (outstanding as at
30 June 2016).
On 26 August 2016, the sale of the Ocean Hill Permit was completed and funds of $200,000 together with
40 million ordinary shares in Eneabba Gas were received on 31 August 2016. Eneabba Gas satisfied the one
remaining condition precedent for the sale of its Perth Basin Permits, which includes the Ocean Hill Permit to
UIL Energy Limited during September 2016. As a result, the Company received 7,309,504 fully paid ordinary shares
and 4,651,515 Class B Convertible Redeemable Preference shares in UIL Energy Limited on 20 September 2016.
The 7,309,504 fully paid ordinary shares are held in voluntary escrow for a period of 6 months from issue.
8
CASh AnD CASh EquIvAlEnTS
For the purposes of the consolidated statement of cash flows, cash and cash equivalents include cash on hand and
in banks, net of outstanding bank overdrafts. Cash and cash equivalents at the end of the reporting period as shown
in the consolidated statement of cash flows can be reconciled to the related items in the consolidated statement of
financial position as follows:
Cash and bank balances
FOR ThE
yEAR EnDED
30/06/2016
FOR THE
YEAR ENDED
30/06/2015
$
$
2,359,185
2,359,185
2,489,586
2,489,586
Black Rock Mining liMited2016 AnnuAl report38 notes to the ConsoLiDateD finanCiaL statements
FOR THE YEAR ENDED 30 JUNE 2016
8
CASh AnD CASh EquIvAlEnTS (COnTInuED)
8.1
Reconciliation of loss for the year to net cash flows from operating activities
Loss after income tax
Depreciation and amortisation of non-current assets
Share based payments to key management personnel
Share based payments to consultants
Net foreign exchange gain/(loss)
Investment revenue recognised in profit or loss
Exploration expenditure paid in shares
Gain on disposal of investment
Impairment of assets
Movements in working capital:
Decrease/(increase) in trade and other receivables
Increase/(decrease) in trade and other payables
Increase/(decrease) in employee entitlements provision
Net cash used in operating activities
8.2 non Cash transactions
FOR ThE
yEAR EnDED
30/06/2016
FOR THE
YEAR ENDED
30/06/2015
$
$
(1,349,305)
(995,121)
-
431,347
124,200
(14,452)
(11,602)
86,000
(238,450)
1,708
38,266
-
(31,396)
(80,873)
-
-
-
1,818
(972,262)
(1,065,598)
55,400
16,206
21,165
(55,130)
18,251
7,696
(879,491)
(1,094,781)
FOR ThE
yEAR EnDED
30/06/2016
FOR THE
YEAR ENDED
30/06/2015
$
$
Investing activity
Payment for acquisition of Tanzanian Graphite Assets – through the issue of
shares
(86,000)
(1,149,728)
Financing activity
Copulos Group Loan – converted into shares
Facility fee payment Copulos Group Loan – issue of shares
Payment for services rendered by consultants – issue of share
Performance rights exercised into shares
-
-
(124,200)
(421,200)
(1,000,000)
(61,080)
(93,334)
-
Black Rock Mining liMited2016 AnnuAl report39 notes to the ConsoLiDateD finanCiaL statements
FOR THE YEAR ENDED 30 JUNE 2016
9
SubSIDIARIES
Details of the Group’s material subsidiaries at the end of the reporting period are as follows:
name of subsidiary
PLACE OF
inCORPORATiOn
AnD OPERATiOn
Green Heat Resources Pty Ltd
Green Rock Geothermal Pty Ltd (iii)
Green Rock Energy International Pty Ltd
Green Rock (Vulcan) Energy kft
GRE Geothermal 1 Pty Ltd (iii)
GRE UWA Corporation Pty Ltd (ii)
Mid West Geothermal Power Pty Ltd (ii)
Mahenge Resources Limited
Bagamoyo Resources Limited (i)
Australia
Australia
Australia
Hungary
Australia
Australia
Australia
Tanzania
Tanzania
PROPORTiOn OF OwnERShiP
inTEREST AnD VOTing POwER
hELD By ThE gROuP
FOR ThE
yEAR EnDED
30/06/2016
FOR THE
YEAR ENDED
30/06/2015
100%
100%
100%
100%
100%
0%
0%
100%
0%
100%
100%
100%
100%
100%
100%
100%
0%
0%
(i) The Company was incorporated 15 October 2015 and the shares were transferred back to original owners on
5th May 2016
(ii) These Companies were deregistered on 4 November 2015.
(iii) This Company was deregistered on 21 August 2016.
10 ExPlORATIOn AnD EvAluATIOn ASSET
in the exploration phase
Balance at beginning of year
Expenditure incurred during the year (at cost)
Assets reallocated to held for sale (cost) (Note 7)
Exploration and evaluation expenditure written off
Balance at end of year
FOR ThE
yEAR EnDED
30/06/2016
FOR THE
YEAR ENDED
30/06/2015
$
$
3,404,600
4,509,427
-
(274,816)
334,454
3,482,529
(412,383)
-
7,639,211
3,404,600
The ultimate recoupment of capitalised exploration expenditure is dependent upon the successful development and/or
commercial exploitation or, alternatively through the sale of the respective underlying licences.
The Group entered into an agreement with Eneabba Gas Limited to dispose of its interest in the Ocean Hill Oil and
gas permit. All costs associated to Ocean Hill has been reallocated to a held for sale asset (refer note 7).
The Company announced on 20 January 2016, that following due diligence it would not be exercising its option to
acquire the Bagamoyo prospects. The exploration costs incurred to date have been impaired to nil at reporting date.
The Company has recognised an impairment loss on the project totalling $274,816 at 30 June 2016.
The remaining balance of $7,639,211 (2015: $3,404,600) at reporting date represents the carrying value of its
Graphite assets in Tanzania.
Black Rock Mining liMited2016 AnnuAl report40 notes to the ConsoLiDateD finanCiaL statements
FOR THE YEAR ENDED 30 JUNE 2016
11 OThER fInAnCIAl ASSETS (nOn-CuRREnT)
Other financial assets
FOR ThE
yEAR EnDED
30/06/2016
FOR THE
YEAR ENDED
30/06/2015
$
$
105,300
105,300
In compliance with the requirements of the South Australian Petroleum Act of 2000, the Company is required to lodge
and maintain with the Minister, for the satisfaction of obligations arising under the Act or the Geothermal Exploration
Licences (GELs) granted, security of $100,000. The security is to be lodged in cash or an unconditional irrevocable
bank guarantee or a letter of credit from a financial institution approved by the Minister.
12 TRADE AnD OThER PAYAblES
Trade creditors
Accruals
Other liabilities
FOR ThE
yEAR EnDED
30/06/2016
FOR THE
YEAR ENDED
30/06/2015
$
$
202,709
281,334
1,000
485,043
189,566
52,965
1,000
243,531
Included in trade creditors and accruals is an amount of $233,175 (2015: $185,214) relating to exploration expenditure.
13
ISSuED CAPITAl
285,404,703 ordinary shares issued and fully paid
(30 June 2015: 207,835,612)
FOR ThE yEAR
EnDED 30/06/2016
FOR THE YEAR
ENDED 30/06/2015
$
$
40,253,116
40,253,116
36,274,617
36,274,617
Changes to the then Corporations Law abolished the authorised capital and par value concept in relation to share
capital from 1 July 1998. Therefore, the Company does not have a limited amount of authorised capital and issued
shares do not have a par value.
Black Rock Mining liMited2016 AnnuAl report41 notes to the ConsoLiDateD finanCiaL statements
FOR THE YEAR ENDED 30 JUNE 2016
13
ISSuED CAPITAl (COnTInuED)
13.1 Fully paid ordinary shares
Balance at 1 July 2014
1,941,273,090
31,311,043
nuMBER OF
ShARES
ShARE
CAPiTAL
$
Shares issued 10 July 2014 ($0.0010 per share)
Shares issued 17 July 2014 ($0.004 per share)
Shares issued 28 July 2014 ($0.003 per share) (i)
Shares issued 15 September 2014 ($0.004 per share)
Shares issued 7 January 2015 ($0.002 per share)
Shares issued 20 January 2015 ($0.004 per share)
33,333,333
6,666,667
213,000,000
8,000,000
48,863,916
16,666,667
Shares consolidation 3 February 2015 (20 for 1 consolidation)
(2,154,412,982)
Shares issued 27 March 2015 ($0.08 per share)
Shares issued 27 March 2015 ($0.08 per share)
Shares issued 31 March 2015 ($0.05 per share) (i)
Shares issued 19 May 2015 ($0.05 per share) (i)
Less: Capital raising costs
Balance at 30 June 2015
Shares issued 6 November 2015 (0.075 cents per share) (i)
Shares issued 30 December 2015 ($0.075 cents per share) (i)
Shares issued 30 December 2015 ($0.060 cents per share)
Shares issued 18 January 2016 ($0.075 cents per share) (i)
Shares issued 28 January 2016 ($0.075 cents per share) (i)
Shares issued 9 May 2016 ($0.054 cents per share) (ii)
Shares issued 17 June 2016 ($0.054 cents per share)
Less: Capital raising costs
Balance at 30 June 2016
33,333
26,667
615,550
32,000
97,728
66,667
-
666,667
320,000
3,026,910
456,824
(378,773)
8,333,323
4,000,000
71,221,598
10,890,000
-
207,835,612
36,274,616
21,116,894
36,316,427
1,800,000
5,233,333
5,002,433
7,800,004
300,000
1,200,536
2,095,362
108,000
302,500
289,128
421,200
16,200
-
(456,426)
285,404,703
40,253,116
(i) Free attaching options were issued as part of these capital raisings and the costs of $1,198,592 (2015: $645,281)
relating to those free attaching options has been transferred to the share based payment reserve (refer note 14).
(ii) Shares were issued on conversion of performance rights.
The following shares are subject to escrow for the periods as follows:
securities
1,211,598 Ordinary Fully Paid Shares
1,116,667 Ordinary Fully Paid Shares
restriction period
26 March 2017
31 March 2017
Black Rock Mining liMited2016 AnnuAl report42 notes to the ConsoLiDateD finanCiaL statements
FOR THE YEAR ENDED 30 JUNE 2016
13
ISSuED CAPITAl (COnTInuED)
13.2 Options
OPEning
BALAnCE
EXERCiSED
in yEAR
gRAnTED
in yEAR
EXPiRED
in yEAR
CLOSing
BALAnCE
Listed options
Expiring 25 March 2017 at $0.05
40,145,000
Expiring 30 November 2018 at
$0.075
-
40,145,000
unlisted options
Expiring 15 November 2015 at $0.40
95,000
Expiring 11 June 2016 at $0.16
Expiring 28 November 2016 at $0.06
Expiring 19 January 2018 at $0.20
100,000
375,000
3,300,003
3,870,003
Weighted average exercise price
$0.19
-
-
-
-
-
-
-
-
-
-
35,333,320
35,333,320
-
-
-
40,145,000
35,333,320
75,478,320
-
-
-
-
-
-
(95,000)
(100,000)
-
-
-
-
375,000
3,300,003
(195,000)
3,675,003
$0.28
$0.18
The weighted average remaining contractual life of options as at 30 June 2016 is 554 days (2015: 856 days).
14 RESERvES (nET Of InCOmE TAx)
reserves
Share based payments reserve (i)
Foreign translation reserve (ii)
(i) share Based payments reserve
FOR ThE
yEAR EnDED
30/06/2016
FOR THE
YEAR ENDED
30/06/2015
$
$
2,125,784
(159,280)
1,966,504
871,015
(58,657)
812,358
The share based payments reserve comprises any equity settled share based payment transactions and other options
transactions. The reserve will be reversed against share capital when the underlying rights are exercised.
Balance at the beginning of the year
Add: Reallocation from share capital for free attaching options
Add: Share based payment relating to capital raising costs
Add: Amounts expensed in the current year
Less: Options expired
Less: Performance rights vested and exercised
FOR ThE
yEAR EnDED
30/06/2016
FOR THE
YEAR ENDED
30/06/2015
$
$
871,015
1,198,592
68,790
431,347
1,306,591
645,281
-
38,266
(22,760)
(1,119,123)
(421,200)
2,125,784
-
871,015
(ii) foreign translation reserve
The foreign translation reserve arises on the consolidation of the Group’s overseas subsidiary companies, Green Rock
(Vulcan) Energy kft and Mahenge Resources Limited.
Black Rock Mining liMited2016 AnnuAl report43 notes to the ConsoLiDateD finanCiaL statements
FOR THE YEAR ENDED 30 JUNE 2016
15 ACCumulATED lOSSES
Balance at beginning of the year
Net loss attributable to members
Transfer to share option reserve
Balance at end of year
16 ShARE bASED PAYmEnTS
(a) Employee Share incentive Scheme
FOR ThE
yEAR EnDED
30/06/2016
FOR THE
YEAR ENDED
30/06/2015
$
$
30,846,306
30,970,308
1,349,305
995,121
(22,760)
(1,119,123)
32,172,851
30,846,306
The establishment of the Black Rock Mining Limited Employee Share Incentive Option Plan (“the Plan”) was initially
approved by special resolution at a General Meeting of shareholders of the Company held on 21 November 2006 and
approval renewed by shareholders on 18 November 2009 and 28 November 2013. All eligible Directors, executive
officers and employees of Black Rock Mining Limited are eligible to participate in the Plan.
The Plan allows the Company to issue free options to eligible persons. The options can be granted free of charge and
are exercisable at a fixed price calculated in accordance with the Plan.
The fair value of the equity-settled share options granted is estimated as at the date of grant using a Black-Scholes
model taking into account the terms and conditions upon which the options were granted.
The share based payment arrangements that were in existence during current and prior-reporting periods is detailed in
note 13.1. During the year, the shared based payment expense recognised in the consolidated statement of profit and
loss totaled $431,347 (2015: $38,266).
share based payment arrangements relating to employees and directors:
E
C
i
R
P
E
S
i
C
R
E
X
E
R
E
B
M
u
n
T
A
S
n
O
i
T
P
O
F
O
gRAnT DATE
EXPiRy DATE
i
i
g
n
n
n
g
E
B
E
h
T
R
A
E
y
E
h
T
F
O
S
n
O
i
T
P
O
D
E
T
n
A
R
g
R
A
E
y
S
i
h
T
R
A
E
y
S
n
O
i
T
P
O
/
D
E
R
i
P
X
E
S
i
h
T
D
E
S
P
A
L
R
A
E
y
E
h
T
F
O
R
E
B
M
u
n
T
A
S
n
O
i
T
P
O
F
O
D
n
E
E
h
T
S
n
O
i
T
P
O
R
A
E
y
E
h
T
E
L
B
A
S
i
C
R
E
X
E
F
O
D
n
E
E
h
T
T
A
E
T
A
D
T
n
A
R
g
T
A
E
u
L
A
V
R
i
A
F
15/11/2011
15/11/2015
$0.40
95,000
11/06/2012
11/06/2016
$0.16
100,000
04/01/2013
28/11/2016
$0.06
375,000
-
-
-
(95,000)
(100,000)
-
-
-
-
$0.01
$0.01
-
375,000
375,000
$0.017
Black Rock Mining liMited2016 AnnuAl report44
notes to the ConsoLiDateD finanCiaL statements
FOR THE YEAR ENDED 30 JUNE 2016
16 ShARE bASED PAYmEnTS (COnTInuED)
(a) Employee Share incentive Scheme (continued)
The following reconciles the outstanding share options granted under the Plan at the beginning and end of the
financial year.
2016
2015
nuMBER OF
OPTiOnS
wEighTED
AVERAgE
EXERCiSE PRiCE
(CEnTS)
NUMBER OF
OPTIONS
WEIGHTED
AVERAGE
EXERCISE PRICE
(CENTS)
570,000
13.00
20,250,000
3.00
-
-
(195,000)
-
375,000
375,000
-
-
3.00
-
6.00
6.00
-
-
(8,850,000)
(10,830,000)
570,000
570,000
-
-
6.00
13.00
13.00
13.00
Balance at the beginning
of the financial year
Granted during the financial year:
- Directors
- Employees
Forfeited/Expired
Share consolidation
Balance at the end of
the financial year
Vested and Exercisable at
the end of the year
Expected volatility is based on the movement of the underlying share price around its average price over the expected
term of the option.
Balance at end of the financial year
The share options outstanding and exercisable at the end of the financial year under the Plan had an exercise price of
$0.06 and a weighted average remaining contractual life of 151 days (2015: 424 days).
(b) Share Based Payments – Other
DATE OF iSSuE
nO. OF ShARES
FAiR VALuE AT
iSSuE DATE
6 November 2015
1,000,000
$0.086
Shares issued for Bagamoyo Graphite project
30 December 2015
1,200,000
30 December 2015
600,000
$0.06
$0.06
17 June 2016
300,000
$0.054
DATE OF iSSuE
nO. OF OPTiOnS
FAiR VALuE AT
iSSuE DATE
Shares issued to Cygnet capital under the
Consultancy Agreement in consideration for
services provided.
Shares issued to Stocks Digital in consideration for
services provided.
Shares issued to Stocks Digital in consideration for
services provided.
9 May 2016
2,000,000
$0.34
Options issued to Gleneagle Securities in accordance
with Capital Raising Mandate from placement.
(c) Performance rights
Expiring 31
December 2017
Expiring 31
December 2018
OPEning
BALAnCE
gRAnTED
in PERiOD
EXERCiSED
in PERiOD
EXPiRED
in PERiOD
CLOSing
BALAnCE
6,700,000
-
6,700,000
-
(4,466,667)
5,000,000
5,000,000
(3,333,333)
(7,800,000)
-
-
-
2,233,333
1,666,667
3,900,000
Black Rock Mining liMited2016 AnnuAl report45
notes to the ConsoLiDateD finanCiaL statements
FOR THE YEAR ENDED 30 JUNE 2016
16 ShARE bASED PAYmEnTS (COnTInuED)
(c) Performance rights (continued)
Performance Rights issued to directors in the Financial Year 2016:
The aggregate number of performance rights issued during the year and held directly, indirectly or beneficially by specified
Directors and other key Management Personnel of the Company or their personally related entities are as follows:
S
T
h
g
i
R
F
O
R
E
B
M
u
n
E
C
n
A
M
R
O
F
R
E
P
1,475,000
1,950,000
1,475,000
–
S
T
h
g
i
R
F
O
E
u
L
A
V
E
C
n
A
M
R
O
F
R
E
P
B
&
A
E
h
C
n
A
R
T
$59,000
$78,000
$59,000
–
S
T
h
g
i
R
C
E
h
C
n
A
R
T
F
O
E
u
L
A
V
E
C
n
A
M
R
O
F
R
E
P
$19,470
$25,740
$19,470
S
T
h
g
i
R
A
E
h
C
n
A
R
T
E
C
n
A
M
R
O
F
R
E
P
S
T
h
g
i
R
B
E
h
C
n
A
R
T
E
C
n
A
M
R
O
F
R
E
P
S
T
h
g
i
R
C
E
h
C
n
A
R
T
E
C
n
A
M
R
O
F
R
E
P
491,667
650,000
491,667
491,667
650,000
491,667
491,666
650,000
491,666
100,000
$4,000
$1,320
33,333
33,333
33,333
Directors
Stephen Copulos
Steven Tambanis
Gabriel Chiappini
employee
Alan Till
PERFORMAnCE RighTS
gRAnT DATE
EXPiRy DATE
FAiR VALuE AT
gRAnT DATE
EXERCiSE PRiCE
Tranche A
Tranche B
Tranche C
30 November 2015
31 December 2018
30 November 2015
31 December 2018
30 November 2015
31 December 2018
$0.060
$0.060
$0.0396
Nil
Nil
NIl
The Performance Rights will vest upon satisfaction of the following milestones:
(i) Tranche A : The Company announces a JORC Code compliant resource of not less than 3,000,000 tonnes of
contained graphite at 8% or more total graphite from its Graphite Projects;
(ii) Tranche B : The Company announces a JORC compliant resource of greater than 4,000,000 tonnes of contained
graphite at 8% or more total graphite contents from its Graphite Projects; and
(iii) Tranche C : From the date of receipt of the Performance Rights, the Company’s 10 day VWAP is equal to or greater
than $0.1275 for a period of 10 consecutive trading days.
Grant date
Number of performance rights:
- S Copulos
- S Tambanis
- G Chiappini
- A Till
Method
Tranches
Grant date share price (cents)
Exercise prices (cents)
Expected volatility
Rights life
Dividend yield
Risk-free interest rate
messrs Copulos, tambanis,
Chiappini & till
30 November 2015
1,475,000
1,950,000
1,475,000
100,000
Black & Scholes
A and B
Monte Carlo Simulation
C
5
Nil – subject to milestone hurdles
(above)
100%
3 years
Nil
2.05%
5
Nil – subject to milestone hurdles
(above)
100%
3 years
Nil
2.05%
Black Rock Mining liMited2016 AnnuAl report46
notes to the ConsoLiDateD finanCiaL statements
FOR THE YEAR ENDED 30 JUNE 2016
16 ShARE bASED PAYmEnTS (COnTInuED)
(c) Performance rights (continued)
Performance Rights issued to directors in the Financial Year 2016: (CoNTiNuED)
In February 2016, the Company announced its maiden JORC resource, which has triggered the satisfaction of vesting
milestones for Tranches A and B of these performance rights.
iSSuED
ShARE
VALuE
$90,000
$90,000
-
OPEning
BALAnCE
gRAnTED
in PERiOD
EXERCiSED
in PERiOD
EXPiRED in
PERiOD
CLOSing
BALAnCE
ORDinARy
ShARES
iSSuED
Tranche A
Tranche B
Tranche C
-
-
-
-
1,666,667
(1,666,667)
1,666,667
(1,666,667)
1,666,666
-
5,000,000
(3,333,334)
-
-
-
-
-
-
1,666,667
1,666,667
1,666,666
-
1,666,666
3,333,334
$180,000
During August 2016, the Company vested the remaining Tranche C performance rights following achievement of the
10 day VWAP milestone. This has been disclosed as a subsequent event.
Performance Rights issued to directors in the Financial Year 2015:
The aggregate number of performance rights issued during the prior reporting period and held directly, indirectly or
beneficially by specified Directors and other key Management Personnel of the Company or their personally related
entities are as follows:
S
T
h
g
i
R
F
O
R
E
B
M
u
n
E
C
n
A
M
R
O
F
R
E
P
–
S
T
h
g
i
R
F
O
E
u
L
A
V
E
C
n
A
M
R
O
F
R
E
P
B
&
A
E
h
C
n
A
R
T
–
S
T
h
g
i
R
C
E
h
C
n
A
R
T
F
O
E
u
L
A
V
E
C
n
A
M
R
O
F
R
E
P
S
T
h
g
i
R
A
E
h
C
n
A
R
T
E
C
n
A
M
R
O
F
R
E
P
S
T
h
g
i
R
B
E
h
C
n
A
R
T
E
C
n
A
M
R
O
F
R
E
P
S
T
h
g
i
R
C
E
h
C
n
A
R
T
E
C
n
A
M
R
O
F
R
E
P
Directors
Stephen Copulos
1,675,000
$55,833
$21,217
558,334
558,333
558,333
Steven Tambanis
3,350,000
$111,667
$42,433
1,116,667
1,116,667
1,116,666
Gabriel Chiappini
1,675,000
$55,833
$21,217
558,334
558,333
558,333
PERFORMAnCE RighT
gRAnT DATE
EXPiRy DATE
FAiR VALuE AT
gRAnT DATE
EXERCiSE PRiCE
Tranche A
Tranche B
Tranche C
19 February 2015
31 December 2017
19 February 2015
31 December 2017
19 February 2015
31 December 2017
$0.050
$0.050
$0.038
Nil
Nil
Nil
The Performance Rights will vest upon satisfaction of the following milestones:
(i) Tranche A : The Company announces a JORC Code compliant resource of not less than 1,000,000 tonnes of
contained graphite at 9% or more total graphite content from the Mahenge Projects;
(ii) Tranche B : The Company announces a JORC compliant resource of greater than 2,000,000 tonnes of contained
graphite at 9% or more graphite content from the Mahenge Projects; and
(iii) Tranche C : From the date of receipt of the Performance Rights, the Company’s 10 day VWAP is equal to or greater
than $0.0875 for a period of 10 consecutive trading days.
Black Rock Mining liMited2016 AnnuAl report47
notes to the ConsoLiDateD finanCiaL statements
FOR THE YEAR ENDED 30 JUNE 2016
16 ShARE bASED PAYmEnTS (COnTInuED)
(c) Performance rights (continued)
Performance Rights issued to directors in the Financial Year 2015: (CoNTiNuED)
Grant date
Number of performance rights:
- S Copulos
- S Tambanis
- G Chiappini
Method
Tranches
Grant date share price (cents)
Exercise prices (cents)
Expected volatility
Rights life
Dividend yield
Risk-free interest rate
messrs Copulos, tambanis,
Chiappini & till
31 March 2015
1,675,000
3,350,000
1,675,000
Black & Scholes
Monte Carlo Simulation
A and B
5
C
5
Nil – subject to milestone hurdles
(above)
Nil – subject to milestone hurdles
(above)
80%
3 years
Nil
2.48%
80%
3 years
Nil
2.48%
In February 2016, the Company announced its maiden JORC resource, which has triggered the satisfaction of the
vesting milestones of Tranches A and B of these performance rights.
OPEning
BALAnCE
gRAnTED
in PERiOD
EXERCiSED
in PERiOD
EXPiRED in
PERiOD
CLOSing
BALAnCE
ORDinARy
ShARES
iSSuED
iSSuED
ShARE
VALuE
Tranche A
2,233,334
Tranche B
2,233,334
Tranche C
2,233,333
6,700,000
-
-
-
-
(2,233,333)
(2,233,334)
-
(4,466,667)
-
-
-
-
-
-
2,233,333
$120,600
2,233,334
$120,600
2,233,333
-
-
2,233,333
4,466,667
$241,200
During August 2016, the Company vested the remaining Tranche C performance rights following achievement of the
10 day VWAP milestone. This has been disclosed as a subsequent event.
Black Rock Mining liMited2016 AnnuAl report48
notes to the ConsoLiDateD finanCiaL statements
FOR THE YEAR ENDED 30 JUNE 2016
17 kEY mAnAgEmEnT PERSOnnEl COmPEnSATIOn
The key management personnel of Black Rock Mining Limited during the year were:
Stephen Copulos
Steven Tambanis
Gabriel Chiappini
Non-Executive Chairman
Appointed – 22 January 2015
Managing Director
Appointed – 22 January 2015
Non Executive Director
Appointed - 21 March 2012
Company Secretary
Appointed - 12 July 2013
Details of the remuneration of key management personnel are set out as follows:
Short-term employee benefit
Post-employment benefits
Share-based payments
Other
FOR ThE
yEAR EnDED
30 JunE 2016
FOR THE
YEAR ENDED
30 JUNE 2015
$
$
403,500
24,250
433,055
21,164
881,969
300,961
11,245
38,266
7,696
358,168
18 REmunERATIOn Of AuDITORS
Auditor of the parent entity
During the year the following fees were paid or were payable for services provided by the auditor of the Company, its
related practices and non-related audit firms:
Audit or review of the financial statements
Investigating Accountants Report
The auditor of Black Rock Mining Limited is Deloitte Touche Tohmatsu.
FOR ThE
yEAR EnDED
30/06/2016
$
49,780
-
49,780
FOR THE
YEAR ENDED
30/06/2015
$
41,077
29,039
70,116
19 RElATED PARTY TRAnSACTIOnS
Remuneration details for Directors and Executives are included in the Remuneration Report and have been audited.
Balances and transactions between the Company and its subsidiaries, which are related parties of the Company,
have been eliminated on consolidation and are not disclosed in this note.
During the reporting period the following amounts were paid to key Management Personnel for services in addition to
those shown elsewhere in this note:
Director
VALuE $
DESCRiPTiOn
Gabriel Chiappini
$84,000
Payments to Laurus Corporate Services for financial services provided
during the reporting period including but not limited to accounting,
bookkeeping, tax and administration.
Black Rock Mining liMited2016 AnnuAl report49
notes to the ConsoLiDateD finanCiaL statements
FOR THE YEAR ENDED 30 JUNE 2016
20 ExPEnDITuRE COmmITmEnTS
(a) Exploration
As part of the Company’s license conditions with the Tanzanian Energy and Minerals Department, the Company is
obliged to pay USD$100 per square kilometer to maintain the license in good standing.
The license costs per annum are as follows:
project name
Mahenge North Project
Makonde Project
Mahenge East Project
LiCEnSE
TyPE
Graphite
Graphite
Graphite
LiCEnSE
nuMBER
PL 7802/2012
PL 10111/2014
PL 10426/2014
Mahenge Southwest Project
Graphite
PL 10427/2014
AREA
kM²
144.10
24.83
154.96
208.67
RATE
PER kM²
USD$100
USD$100
USD$100
USD$100
TOTAL
USD$14,410
USD$2,483
USD$15,496
USD$20,867
As part of the conditions to acquire the exploration licences there were minimum exploration expenditure
commitments. These have all been met by 30 June 2016.
As part of the contract to acquire the graphite exploration licences, under certain milestone conditions the Company
will be obliged to make additional payments. These payments are subject to the following conditions:
Exploration licence PL7802/2012
• $250,000 cash or equivalent number of fully paid Black Rock Mining shares (at the election of the vendor) upon
announcement of a JORC compliant resource of greater than 250,000 tonnes of contained graphite at >7% TGC
is announced – this milestone has been met and consideration paid;
• $250,000 cash or cash equivalent number of fully paid Black Rock Mining shares (at the election of the vendor) to
be paid when the Company share price exceeds a VWAP of $0.10 for a period of at least ten consecutive trading
days; and
• $500,000 cash or cash equivalent number of fully paid Black Rock Mining shares (at the election of the vendor)
upon announcement of a JORC compliant resource of greater than 1,000,000 tonnes of contained graphite at
>7% TGC is announced – this milestone has been met and consideration paid.
The two milestone payments subject to the announcement of a JORC compliance resource was triggered in February
2016 and was subsequently paid in cash. In August 2016, the Company met the final milestone payment on trigger
of the Company’s share price exceeding a VWAP of $0.10, which has been subsequent been paid in cash of $225,000
and $25,000 in shares.
Exploration licence PL10111/2014, PL10426/2014 and PL10427/2014
• $250,000 cash or equivalent number of fully paid Green Rock shares (at the election of the vendor) upon
announcement of a JORC compliant resource of greater than 250,000 tonnes of contained graphite at >9% TGC
is announced. Issue price of shares to be calculated based on the preceding seven (7) day VWAP; and
• $375,000 cash and the equivalent value ($375,000) in Black Rock Mining Shares to be paid when a JORC compliant
Resource with greater than 1,000,000 tonnes of contained graphite at >9% total graphite content at any of the
Projects is announced by Black Rock Mining on the ASX. The issue price of GRk Shares is to be calculated based on
the VWAP of Black Rock Mining Shares in the 5 days prior to the release of the announcement.
South Australian Permit
With regards to the Company’s South Australian Geothermal Permit now in the process of being relinquished,
there may be a requirement for the Company to undertake remedial work on a previously drilled geothermal well.
This exposure is covered by way of a cash backed bond ($105,300) that the South Australian Department for
Manufacturing, Innovation, Trade, Resources and Energy. The Company estimates that the remedial work will total
approximately $60,000.
(b) Capital Commitments
The Group has no capital commitments (2015: Nil).
(c) Operating Lease Commitments
As at 30 June 2016 and at the date of this report, there are no operating lease commitments (2015: Nil).
Black Rock Mining liMited2016 AnnuAl report50
notes to the ConsoLiDateD finanCiaL statements
FOR THE YEAR ENDED 30 JUNE 2016
21
lOSS PER ShARE
The following reflects the profit/ (loss) and share details used in the calculation of basic and diluted profit/ (loss) per share:
profit / (Loss) used in calculating basic and diluted loss per share
From continuing operations
From discontinued operations
FOR ThE
yEAR EnDED
30/06/2016
FOR THE
YEAR ENDED
30/06/2015
$
$
(1,582,183)
232,878
(1,349,305)
(956,342)
(38,779)
(995,121)
Weighted average number of ordinary shares used in calculating basic and
diluted profit/ (loss) per share:
247,023,437
133,206,619
Basic and diluted profit / (loss) per share
From continuing operations
From discontinuing operations
Total basic and diluted profit/ (loss) per share
($0.0064)
$0.0009)
($0.0055)
($0.0072)
($0.0003)
($0.0075)
The consolidated entity’s options and performance rights potentially dilute basic earnings per share in the future.
However they have been excluded from the calculations of diluted earnings per share because they are anti-dilutive
and out of the money for the years presented.
22
fInAnCIAl InSTRumEnTS
The Group manages its capital to ensure that entities in the Group will be able to continue as going concerns while
maximizing the return to stakeholders through the optimization of the debt and equity balance. The Group’s overall
strategy remains unchanged from 2015.
The capital structure of the Group consists of net debt (borrowings offset by cash and bank balances as detailed in note 8)
and equity of the Group (comprising issued capital, reserves and accumulated losses as detailed in notes 13, 14 and 15).
(a) Capital Management
The main focus of the Group’s capital management policy is to ensure adequate working capital to fund the
exploration and development activities of its various geothermal projects. This is done through the close monitoring
of cash flow projections.
The Group’s working capital as at balance date was:
Cash and bank balances
Trade and other receivables
Trade and other payables
22.1 Financial risk management
FOR ThE
yEAR EnDED
30/06/2016
FOR THE
YEAR ENDED
30/06/2015
$
$
2,359,185
2,489,586
24,627
80,027
(485,043)
1,898,769
(243,531)
2,326,081
The Group’s activities expose it to a variety of financial risks: market risk (including currency risk and interest rate),
credit risk and liquidity risk. The Group’s overall risk management program focuses on the unpredictability of financial
markets and seeks to minimise potential adverse effects on the financial performance of the Group. The Group does
not use derivative financial instruments.
Risk management is the responsibility of the Board of Directors.
Black Rock Mining liMited2016 AnnuAl report51
notes to the ConsoLiDateD finanCiaL statements
FOR THE YEAR ENDED 30 JUNE 2016
22
fInAnCIAl InSTRumEnTS (COnTInuED)
(a) Capital Management (continued)
22.2 Market risk
22.2.1 Foreign exchange risk
The Group transacts in US Dollars in relation to its Tanzanian operations and has a minority interest in a Geothermal
operation in Hungary and is exposed to foreign exchange currency movements arising from various currency
exposures, primarily with respect to the US Dollar and the Hungarian Forint.
Foreign exchange risk arises from recognised assets and liabilities denominated in a currency that is not the entity’s
functional currency and net investments in foreign operations.
The Group’s exposure to foreign currency risk at the reporting date was as follows:
Group sensitivity
The parent entity advances funds to the Tanzanian subsidiary in US Dollars. The foreign exchange is recognised in
the parent entity. The parent entity also advances funds to the Hungarian subsidiary in Australian Dollars. In practical
terms the Australian Dollar is converted to the Euro and the Hungarian Forint (“HUF”). The foreign exchange risk is
recognized by the Hungarian subsidiary.
The consolidated entity’s pre-tax profit for the year would have been $209,853/222,776 higher/lower (2015:
$214,727 higher/ $137,133 lower) had the Australian dollar strengthened/weakened by 10% against the US Dollar
and the Hungarian Forint.
22.2.2 Cash flow and fair value interest rate risk
The Group is exposed to interest rate risk through cash and cash equivalents $2,359,185 (2015: $2,489,586).
At 30 June 2016, if the interest rates had weakened/strengthened by 100 basis points from the year-end rates with all
other variables held constant, post-tax profit for the year would have been $1,063 lower/higher (2015: $1,689 lower/
higher) mainly as a result of interest income deceases/increases.
(b) Credit risk
Credit risk is managed on a group basis. Credit risk arises from cash and cash equivalents as well as credit exposures
to customers, including outstanding receivables and committed transactions.
Cash and cash equivalents are held with recognisable banking and financial institutions. The maximum exposure to
credit risk for cash and cash equivalents is the carrying value.
Other receivables are due from third parties considered credit worthy. The maximum exposure to credit risk for other
receivables at the reporting date is the carrying amount. The ageing analysis of receivables is as follows:
Debtor
Trade receivable
< 30 DAyS
24,627
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.
22.3 Liquidity risk
Prudent liquidity risk management implies maintaining sufficient cash to ensure that the Group’s liabilities can be
settled as and when they become due.
22.3.1 Maturities of financial liabilities
The tables below analyses the Group’s financial liabilities into relevant maturity groupings based on the remaining
period at the reporting date to the contractual maturity date. The amounts disclosed in the table are the contractual
undiscounted cash flows.
Creditor
Trade payables
22.4 Fair value estimation
< 1 MOnTh
177,740
The fair value of financial assets and financial liabilities must be estimated for recognition and measurement or for
disclosure purposes. The carrying values less impairment provision of trade receivables and payables are assumed to
approximate their fair values due to their short-term nature.
Black Rock Mining liMited2016 AnnuAl report52
notes to the ConsoLiDateD finanCiaL statements
FOR THE YEAR ENDED 30 JUNE 2016
23 COnTIngEnT lIAbIlITIES
There were no material contingent liabilities as at 30 June 2016.
In compliance with the requirements of the South Australian Petroleum Act of 2000 the Company is required to
maintain with the Minister, for the satisfaction of obligations arising under the Act or the Geothermal Exploration
Licences (GELs) granted, security of $100,000. The security is to be lodged in cash or an unconditional irrevocable
bank guarantee. The security lodged by the Company covers all South Australian GELs granted to the Company.
If on expiry of the GELs they are not renewed and the Minister is satisfied that there are no further obligations under
the licences or the Act, the Minister will return the security to the Company.
24 EvEnTS AfTER ThE REPORTIng DATE
During August 2016, the Company announced that it had settled the final milestone payment on Mahenge North
Project. The final payment of $250,000 was triggered following the Company’s share price exceeding a daily volume
weighted average price (“VWAP”) of $0.10 for 10 consecutive trading days. The payment was made to the vendor
of Mahenge North Project who elected to receive cash of $225,000 and shares worth $25,000 at an issue price of
$0.10 each (250,000 ordinary shares).
In August 2016, the Company announced it had reached its final milestone in relation to Tranche C of the
Performance Rights on issue when the Company’s share price exceeded a daily VWAP of $0.1275 for 10 consecutive
trading days. The Performance Rights were converted to 3,899,996 ordinary shares in the Company.
On 26 August 2016, the Company announced that the divestment of the Ocean Hill permit to Eneabba Gas was
completed. As a result of the sale of the permit the Company has been issued with 40 million Eneabba Gas shares
and $200,000 cash consideration, received on 31 August 2016. Eneabba Gas satisfied the one remaining condition
precedent for the sale of its Perth Basin Permits, which includes the Ocean Hill Permit to UIL Energy Limited during
September 2016. As a result, the Company received 7,309,504 fully paid ordinary shares and 4,651,515 Class B
Convertible Redeemable Preference shares in UIL Energy Limited on 20 September 2016. The 7,309,504 fully paid
ordinary shares are held in voluntary escrow for a period of 6 months from issue.
In August 2016 the Company announced that option holders had converted 30,000 options of $0.05 expiring
25 March 2017 and 833,332 options of $0.075 expiring 30 November 2018 to 863,332 ordinary shares.
On 1 September 2016 the Company announced that options holders had converted 300,000 options of $0.05
expiring 25 March 2017 and 33,333 options of $0.075 expiring 30 November 2018 to 333,333 fully paid
ordinary shares.
On 20 September 2016 the Company announced that it had finalised a share placement with a total of 33,333,333
shares issued at $0.15 per share raising $5m (before costs) with the shares placed to institutional and sophisticated
investors. The board of directors have taken up an allocation of 1,500,000 shares totalling $225,000 on the same
terms and conditions, with the allocation subject to shareholder approval, expected to occur at the November 2016
Annual General Meeting.
On 23 September 2016 the Company announced that option holders had converted 500,000 options of $0.075
expiring 30 November 2018 to 400,000 fully paid ordinary shares.
Other than the above, the Directors are not aware of any matter or circumstance that has significantly or may
significantly affect the operation of the Company or the results of those operations, or the state of affairs of the
Company in subsequent financial years.
Black Rock Mining liMited2016 AnnuAl report53 25 PAREnT EnTITY InfORmATIOn
The accounting policies of the parent entity, which have been applied in determining the financial information shown
below, are the same as those applied in the consolidated financial statements. Refer to note 2 for a summary of
significant account policies.
Financial Position
assets
Current assets
Non-current assets
Total assets
Liabilities
Current liabilities
Non-current liabilities
Total liabilities
equity
Issued capital
Retained earnings
Reserves
Total equity
Financial performance
Loss for the year
Other comprehensive income
Total comprehensive loss
FOR ThE
yEAR EnDED
30/06/2016
$
FOR THE
YEAR ENDED
30/06/2015
$
2,810,057
2,977,441
7,439,423
10,249,480
3,511,104
6,485,545
97,433
248,047
-
97,433
-
248,047
40,253,116
36,274,616
(32,226,852)
(30,905,133)
2,125,784
10,152,048
871,015
6,240,498
FOR ThE
yEAR EnDED
30/06/2016
FOR ThE
yEAR EnDED
30/06/2015
$
$
1,344,479
3,220,298
-
-
1,344,479
3,220,298
Black Rock Mining liMited2016 AnnuAl report54 DireCtors’ DeCLaration
The directors declare that:
a)
b)
c)
in the directors’ 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;
in the directors’ opinion, the attached financial statements are in compliance with International Financial Reporting
standards, as stated in note 2.1 to the financial statements;
in the directors’ opinion, the attached financial statements and notes thereto are in accordance with the Corporations
Act 2001, including compliance with accounting standards and giving a true and fair view of the financial position and
performance of the consolidated entity; and
d) the directors have been given the declarations required by s.295A of the Corporations Act 2001.
Signed in accordance with a resolution of the directors made pursuant to s. 295(5) of the Corporations Act 2001.
On behalf of the Directors
Stephen Copulos
CHAIRMAN
Perth, 29 September 2016
Black Rock Mining liMited2016 AnnuAl report55 inDepenDent auDitor’s report
Deloitte Touche Tohmatsu
ABN 74 490 121 060
Tower 2, Brookfield Place
123 St Georges Terrace
Perth WA 6000
GPO Box A46
Perth WA 6837 Australia
Tel: +61 8 9365 7000
Fax: +61 8 9365 7001
www.deloitte.com.au
Independent Auditor’s Report
to the members of Black Rock Mining Limited
Report on the Financial Report
We have audited the accompanying consolidated financial report of Black Rock Mining Limited, which
comprises the statement of financial position as at 30 June 2016, the statement of profit or loss and other
comprehensive income, the statement of cash flows and the statement of changes in equity for the year
ended on that date, notes comprising a summary of significant accounting policies and other explanatory
information, and the directors’ declaration of the consolidated entity, comprising the company and the
entities it controlled at the year’s end or from time to time during the financial year as set out on pages 21
to 55.
Directors’ Responsibility 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
consolidated financial report that gives a true and fair view and is free from material misstatement,
whether due to fraud or error. In Note 2.1, the directors also state, in accordance with Accounting
Standard AASB 101 Presentation of Financial Statements, that the consolidated financial statements
comply with International Financial Reporting Standards.
Auditor’s Responsibility
Our responsibility is to express an opinion on the consolidated financial report based on our audit. We
conducted our audit in accordance with Australian Auditing Standards. Those standards require that we
comply with relevant ethical requirements relating to audit engagements and plan and perform the audit
to obtain reasonable assurance whether the consolidated financial report is free from material
misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in
the consolidated financial report. The procedures selected depend on the auditor’s judgement, including
the assessment of the risks of material misstatement of the consolidated financial report, whether due to
fraud or error. In making those risk assessments, the auditor considers internal control, relevant to the
company’s preparation of the consolidated financial report that gives a true and fair view, 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 company’s internal control. An audit also includes evaluating the
appropriateness of accounting policies used and the reasonableness of accounting estimates made by the
directors, as well as evaluating the overall presentation of the consolidated financial report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our audit opinion.
Liability limited by a scheme approved under Professional Standards Legislation.
Member of Deloitte Touche Tohmatsu Limited 56
Black Rock Mining liMited2016 AnnuAl report56
inDepenDent auDitor’s report
Auditor’s Independence Declaration
In conducting our audit, we have complied with the independence requirements of the Corporations Act
2001. We confirm that the independence declaration required by the Corporations Act 2001, which has
been given to the directors of Black Rock Mining Limited, would be in the same terms if given to the
directors as at the time of this auditor’s report.
Opinion
In our opinion:
(a) the consolidated financial report of Black Rock Mining Limited is in accordance with the Corporations
Act 2001, including:
(i) giving a true and fair view of the consolidated entity’s financial position as at 30 June 2016 and of
its performance for the year ended on that date; and
(ii) complying with Australian Accounting Standards and the Corporations Regulations 2001; and
(b) the consolidated financial statements also comply with International Financial Reporting Standards as
disclosed in Note 2.1.
Report on the Remuneration Report
We have audited the Remuneration Report included in pages 13 to 19 of the directors’ report for the year
ended 30 June 2016. 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.
Opinion
In our opinion the Remuneration Report of Black Rock Mining Limited for the year ended 30 June 2016,
complies with section 300A of the Corporations Act 2001.
DELOITTE TOUCHE TOHMATSU
Ian Skelton
Partner
Chartered Accountants
Perth, 29 September 2016
57
Black Rock Mining liMited2016 AnnuAl report57
aDDitionaL asX information
ORDInARY fullY PAID ShARES
Range of shares AS OF 31 AUGUST 2016
range
TOTAL hOLDERS
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 - 9,999,999,999
rounding
total
unmarketable Parcels
ShARES
55,874
582,885
1,213,429
30,167,543
258,398,300
% OF iSSuED
CAPiTAL
0.02
0.20
0.42
10.39
88.97
0.00
130
197
151
793
273
1,544
290,418,031
100.00
MiniMuM
PARCEL SizE
hOLDERS
ShARES
Minimum $ 500.00 parcel at $ 0.1650 per unit
3031
244
288998
Top 20 Shareholders AS OF 22 SEPTEMBER 2016
RAnk nAME
ShARES
% OF ShARES
CITYWEST CORP PTY LTD
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