(cid:21)(cid:19)(cid:20)(cid:25)(cid:3)(cid:36)(cid:49)(cid:49)(cid:56)(cid:36)(cid:47)(cid:3)(cid:53)(cid:40)(cid:51)(cid:50)(cid:53)(cid:55)
CORPORATE DIRECTORY
NON-EXECUTIVE CHAIRMAN
Ronnie Beevor
CHIEF EXECUTIVE OFFICER & MANAGING DIRECTOR
Brandon Munro
NON-EXECUTIVE DIRECTORS
Ian Burvill
Clive Jones
David Tucker
PRINCIPAL & REGISTERED OFFICE
Unit 1, 2 Centro Avenue
Subiaco
Western Australia, Australia 6008
Telephone: +61 (8) 9381 1436
Facsimile: +61 (8) 9381 1068
AUDITORS
Ernst & Young
11 Mounts Bay Road
PERTH WA 6000
Telephone: +61 (8) 9429 2222
Facsimile: +61 (8) 9429 2432
SHARE REGISTRAR
Computershare (Australia)
Level 11
172 St George’s Terrace
PERTH WA 6000
Telephone from within Australia:
Telephone from outside Australia:
Facsimile:
1300 850 505
+61 (3) 9415 4000
+61 (8) 9323 2033
STOCK EXCHANGE LISTINGS
Australian Securities Exchange (ASX Code: BMN)
Namibian Stock Exchange (NSX Code: BMN)
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
i
TABLE OF CONTENTS
Chairman’s Letter to Shareholders .......................................................................................................... 1
Board of Directors and Executives ........................................................................................................... 2
Directors’ Report ...................................................................................................................................... 5
Remuneration Report .............................................................................................................................16
Financial Statements ..............................................................................................................................29
Directors’ Declaration ............................................................................................................................74
Independent Auditor’s Report to the Members ....................................................................................75
ASX Additional Information ....................................................................................................................77
ABOUT BANNERMAN RESOURCES LIMITED
interests
in Namibia, a southern African country which
About Bannerman - Bannerman Resources Limited is an ASX and NSX listed exploration and development company
is a premier uranium mining
with uranium
jurisdiction. Bannerman’s principal asset is its 100%-owned Etango Project situated near Rio Tinto’s Rössing
uranium mine, Paladin’s Langer Heinrich uranium mine and CGNPC’s Husab uranium mine currently under
construction. A definitive feasibility study and an optimisation study has confirmed the technical, environmental and
financial (at consensus long term uranium prices) viability of a large open pit and heap leach operation at one of the
world’s largest undeveloped uranium deposits.
In 2016, Bannerman is continuing a large scale heap leach demonstration program to provide further assurance to
financing parties, generate process information for the detailed engineering design phase and build and enhance
internal capability. More information is available on Bannerman’s website at www.bannermanresources.com.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
CHAIRMAN’S LETTER TO SHAREHOLDERS
Dear Shareholder
Bannerman’s Etango project has advanced significantly during the past year, at a time when decade-low uranium
prices have otherwise deferred or stalled investment across the sector.
Despite these exceptionally difficult market conditions, your Board is proud of Bannerman’s key achievements since
November 2015, notably:
(cid:120)
a seamless leadership change which saw Brandon Munro appointed as Chief Executive Officer/Managing
Director, Werner Ewald promoted to Managing Director – Namibia and Dustin Garrow appointed as
Strategic Uranium Marketing Advisor;
(cid:120) Bannerman’s corporate structure was consolidated resulting in Bannerman owning 100% of the Etango
(cid:120)
(cid:120)
project and eliminating all corporate debt;
the Etango Optimisation Study was completed, reducing key operating and capital costs for the Etango
project, compared with the 2012 Definitive Feasibility Study (DFS); and
successful operation of the Etango Heap Leach Demonstration Plant, which confirmed or exceeded key DFS
assumptions, thereby significantly de-risking the project and demonstrating further opportunities for cost
reduction.
The above achievements collectively position Bannerman exceptionally well for an anticipated uranium price
recovery, with a world-class scale project boasting an optimised DFS, environmental and social approvals and a
successful demonstration plant.
Under the new leadership of Brandon Munro, our focus in the next year will be twofold. Firstly, we will further
enhance the Etango project DFS by incorporating the results of the Heap Leach Demonstration Plant and other cost
savings our engineering team has identified, with a view to improving operating and capital costs.
Secondly, we will continue to build on the marketing and financing initiatives that commenced this year with the
appointment of Brandon Munro and Dustin Garrow, who together bring a depth of experience in uranium marketing
and economics, corporate finance and capital markets strategy. These initiatives already have provided us with
greatly enhanced insights into the nuclear fuel cycle and confidence in an abrupt and sustained recovery in the
uranium price to levels that will enable profitable development of the Etango Project.
Bannerman continues to be a leader in Namibia in matters of health, safety, community and environment. For
example:
(cid:120) we have operated without incurring a lost time injury since 2009;
(cid:120)
our community engagement and corporate social responsibility (CSR) program earned us the keynote CSR
presentation at the 2016 Namibian Mining Expo; and
(cid:120) Bannerman continues its excellent environmental track record with superb rehabilitation of the trial mining
site associated with the Heap Leach Demonstration Plant.
My sincere thanks to all of our management, employees, consultants and contractors who continue to work with
dedication and without discouragement by current market conditions.
I also acknowledge and appreciate the support and patience of our shareholders during these difficult times, in
particular the continued investment and technical support from Resource Capital Funds as our largest shareholder.
Yours sincerely
Ronnie Beevor
Chairman
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
1
BOARD OF DIRECTORS AND EXECUTIVES
BOARD OF DIRECTORS
Ronald (Ronnie) Beevor
B.A. (Hons)
Non-Executive Chairman
Term of Office
Director since 27 July 2009, Chairman since 21 November
2012
Independent: Yes
Skills, experience and expertise
Ronnie has more than 30 years of experience in
investment banking, including being the Head of
Investment Banking at NM Rothschild & Sons
(Australia) Limited between 1997 and 2002. During
his career, Ronnie has had an extensive involvement
in the natural resources industry, both in Australia
and internationally. He is a former director of Oxiana
Limited which successfully developed the Sepon gold-
copper project in Laos as well as the Prominent Hill
copper-gold project in South Australia.
Ronnie has an Honours Degree in Philosophy, Politics
and Economics from Oxford University (UK) and
qualified as a chartered accountant in London in
1972.
Special Responsibilities
Member of the Audit Committee
Member of
Corporate Governance Committee
the Remuneration, Nomination and
Current ASX listed directorships
Wolf Minerals Limited (appointed 20 September 2013)
MZI Resources Limited (appointed 15 April 2016)
Former ASX listed directorships over the past three
years
Ampella Mining Limited (5 July 2011 to 31 March 2014)
Bullabulling Gold Limited (2 July 2012 to 1 August 2014)
Unity Mining Limited (1 November 2002 to 18 November
2015)
Brandon Munro
LLB, B.Econ, GAICD, F Fin
Chief Executive Officer (CEO) and Managing Director
Term of Office:
CEO and Managing Director since 9 March 2016
Independent: No
Skills, experience and expertise
Brandon has 18 years of experience as a corporate
lawyer and resources executive, including serving as
Bannerman’s General Manager between 2009-2011,
based in Namibia. Before joining Bannerman as
CEO/Managing Director, Brandon was Managing
Director of ASX-listed Kunene Resources Ltd, which
was focused on base metals exploration in Namibia.
Brandon lived in Namibia for over five years between
2009-2015, where he also served as Governance
Advisor to the Namibian Uranium Association and
Strategic Advisor – Mining Charter to the Namibian
Chamber of Mines.
Brandon is a Trustee of Save the Rhino Trust Namibia,
a high profile Namibian NGO.
Special Responsibilities
Managing Director
Current ASX listed directorships
Rewardle Holdings Limited (appointed 25 March 2014)
Novatti Group Limited (appointed 12 October 2015)
Former ASX listed directorships over the past three
years
Kunene Resources Limited (4 April 2014 to 18 December
2015)
Leonard (Len) Jubber
BEng (Civil), MBA
Chief Executive Officer (CEO) and Managing Director
Term of Office:
CEO and Managing Director from 17 November 2008 to 8
March 2016
Independent: No
Skills, experience and expertise
Len has over 25 years of international experience in
the minerals industry. Immediately prior to joining
Bannerman, Len was the Managing Director and Chief
Executive Officer of Perilya Limited from May 2005 to
March 2008. Len also worked for seven years with
OceanaGold Limited, ultimately becoming Chief
Operating Officer and an Executive Director of the
company. Len started his mining career in Namibia
with Rössing Uranium Limited, a subsidiary of Rio
Tinto.
Special Responsibilities
Managing Director
Current ASX listed directorships
Nil
Former ASX listed directorships over the past three
years
Nil
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
2
BOARD OF DIRECTORS AND EXECUTIVES (CONTINUED)
Ian Burvill
BEng (Mech), MBA, MIEAust, CPEng, M.AusIMM,
GAICD
Non-Executive Director
Term of Office
Director since 14 June 2012
Independent No
Skills, experience and expertise
Ian has more than 30 years of mining industry
experience, firstly in process plant engineering, then
in project finance (with Rothschild Australia Limited)
and more recently in private equity finance (with
Resource Capital Funds, until 30 June 2016). Ian is a
director of Jolimont Global Mining Systems Pty Ltd, a
investment company. He was
mining
nominated to Bannerman’s board by RCF.
innovation
Special Responsibilities
Member of
Corporate Governance Committee
the Remuneration, Nomination and
Current ASX listed directorships
Nil
Other current listed directorships
Nil
Former ASX listed directorships over the past three
years
Nil
Clive Jones
B.App.Sc(Geol), M.AusIMM
Non-Executive Director
Term of Office
Director since 12 January 2007
Independent No
Skills, experience and expertise
Clive has more than 25 years of experience in mineral
exploration, across a diverse range of commodities
including gold, base metals, mineral sands, uranium
and iron ore. Clive is the original vendor of the
Company’s Etango Project in Namibia.
Special Responsibilities
Chairman of
Corporate Governance Committee
Member of
Community Committee
Member of the Audit Committee
the Remuneration, Nomination and
the Health, Safety, Environment and
Current ASX listed directorships
Cazaly Resources Limited (Joint Managing Director)
(appointed 15 September 2003)
Corazon Mining Limited
February 2005)
(appointed 10
(Chairman)
Former ASX listed directorships over the past three
years
Unity Mining Limited (Chairman) (10 January 2013 to
1 June 2016)
David Tucker
BSc.Geol (Hons), MSc(Mining and Exploration Geology),
M.AusIMM, FAICD
Non-Executive Director
Term of Office
Director since 18 March 2008
Independent Yes
Skills, experience and expertise
David has more than 40 years of experience in mining
and exploration, including 20 years working as an
exploration geologist, the first 10 years of which were
in the uranium sector with United Uranium NL,
Noranda Australia, the Australian Atomic Energy
Commission and Esso Australia Limited. David was
formerly responsible
for business development,
public affairs and investor relations at Homestake
Gold of Australia, Director of Corporate Affairs at
Barrick Australia Pacific and a director of Homestake's
Australian subsidiaries, Barrick Mining Company
(Australia) and Barrick Gold of Australia.
Special Responsibilities
Chairman of the Health, Safety, Environment and
Community Committee
Chairman of the Audit Committee
Current ASX listed directorships
Nil
Former ASX listed directorships over the past three
years
Nil
COMPANY SECRETARY
Robert Dalton
BA (Hons), FCCA, AFIN, AGIA, ACIS
Term of Office
Company Secretary since 17 September 2014
Skills, experience and expertise
Robert has more than 15 years of experience in
auditing, accounting and secretarial roles.
He
commenced his career at an international accounting
firm and has had significant exposure to the
resources sector. His most recent appointment was
that of Chief Financial Officer and Company Secretary
at Tangiers Petroleum Ltd.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
3
BOARD OF DIRECTORS AND EXECUTIVES (CONTINUED)
EXECUTIVE
Werner Ewald
BSc (Elect), MBA (Stellenbosch)
Managing Director, Bannerman Mining Resources
(Namibia) (Pty) Ltd
Term of Office
Since 24 June 2010
Skills, experience and expertise
Australia.
Werner joined Bannerman in June 2010 as the Etango
Project Co-ordinator following 22 years with Rio Tinto
which included 20 years at the Rössing Uranium Mine
in Namibia and 2 years at the Tarong Coal Mine in
Queensland,
numerous
operational roles at Rössing including Engineering
Manager, Mine Operations Manager and Business
Improvement Manager. Prior to Rio Tinto he worked
with the De Beers Group at their underground
operations near Kimberly, South Africa and the
Namdeb alluvial operations in Namibia.
held
He
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
4
DIRECTORS’ REPORT
FOR THE YEAR ENDED 30 JUNE 2016
The directors present their report on the consolidated entity comprising Bannerman Resources Limited
(“Bannerman” or the “Company”) and its controlled entities (the “Group”) for the year ended 30 June 2016 (“the
financial year”). Bannerman is a company limited by shares that is incorporated and domiciled in Australia.
BOARD OF DIRECTORS
The directors of Bannerman in office during the financial year and up to the date of this report were:
Name
Ronnie Beevor
Brandon Munro
Len Jubber
Ian Burvill
Clive Jones
David Tucker
Position
Independent
Appointed / Resigned
Non-Executive Chairman
Chief Executive Officer
Chief Executive Officer
Non-Executive Director
Non-Executive Director
Non-Executive Director
Yes
No
No
No
No
Yes
27 July 2009
9 March 2016
Resigned 8 March 2016
14 June 2012
12 January 2007
18 March 2008
COMPANY SECRETARY
The company secretary of Bannerman in office during the financial year and up to the date of this report was:
Name
Appointed
Robert Dalton
17 September 2014
INFORMATION ON DIRECTORS AND COMPANY SECRETARY
Particulars on the skills, experience, expertise and responsibilities of each director and the company secretary at the
date of this report, including all directorships of other companies listed on the Australian Securities Exchange, held or
previously held by a director at any time in the past three years, are set out on pages 2 to 4 of this report.
BOARD MEETING ATTENDANCE
Particulars of the number of meetings of the Board of directors of Bannerman and each Board committee of
directors held and attended by each director during the 12 months ended 30 June 2016 are set out in Table 1 below.
Table 1. Directors in Office and attendance at Board and Board Committee Meetings during 2015/2016
Board meetings
Board committee meetings
Remuneration,
Nomination & Corp.
Governance
Committee
HSEC
Committee
Audit Committee
A
12
3
9
12
12
12
B
12
3
9
12
12
12
A
4
-
4*
-
4
4
B
4
-
-
-
4
4
A
5
2*
3*
5
5
4*
B
5
-
-
5
5
-
A
2*
1*
1*
-
2
2
B
-
-
-
-
2
2
Ronnie Beevor
Brandon Munro
Len Jubber
Ian Burvill
Clive Jones
David Tucker
A = Number of meetings attended
B = Number of meetings held during the time the director held office or was a member of the relevant committee during the year.
Indicates that a Director attended some or all meetings by invitation whilst not being a member of a specific committee.
*
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
5
DIRECTORS’ REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
DIRECTORS’ INTERESTS IN SECURITIES IN BANNERMAN
As at the date of this report, the relevant interests of each director in the ordinary shares and share options in
Bannerman, as notified to the Australian Securities Exchange in accordance with s205G(1) of the Corporations Act
2001, are as follows:
Fully Paid Ordinary Shares
Share Options
Performance Rights
Beneficial,
private
company or
trust
Own name
Beneficial,
private
company or
trust
Own name
1,601,543
719,100
-
8,007,200
2,000,000
-
77,207,668
2,313,275
-
-
-
-
20,000,000
4,003,600
4,003,600
-
-
-
-
-
Beneficial,
private
company or
trust
-
-
-
-
862,100
Own name
-
-
-
-
-
Ronnie Beevor
Brandon Munro
Ian Burvill (1)
Clive Jones
David Tucker
(1) These share options are held by Resource Capital Funds Management Pty Ltd, and are noted against the relevant RCF
representative director.
PRINCIPAL ACTIVITIES
Bannerman Resources Limited is an exploration and development company with uranium interests in Namibia, a
southern African country which is a premier uranium mining jurisdiction. Bannerman’s principal asset is its 100%-
owned Etango Project situated southwest of Rio Tinto’s Rössing uranium mine and CGNPC’s Husab Project currently
under construction and to the north west of Paladin Energy’s Langer-Heinrich mine. Etango is one of the world’s
largest undeveloped uranium deposits. Bannerman is focused on the development of a large open pit uranium
operation at Etango.
OPERATING AND FINANCIAL REVIEW
CORPORATE
On 31 December 2015, the Company announced that, following gaining shareholder approval on 29 December 2015,
it completed significant transactions with the Company’s major shareholders, Resource Capital Fund IV L.P. and
Resource Capital Fund VI L.P. (“RCFIV” and “RCFVI” respectively and “RCF” collectively), and with Mr Clive Jones, a
director and shareholder of the Company.
The completed transactions entailed:
(cid:131)
(cid:131)
acquisition of the non-controlling interest (20%) in the Etango Project from the current owners (represented by
Mr Clive Jones) for payment of approximately 123.4 million new Bannerman shares and A$1 million in cash;
extinguishment of the A$12 million convertible notes through:
o
o
conversion of A$8 million of the convertible notes held by RCF into Bannerman shares at the given
conversion price of A$0.075 per share;
sale of a 1.5% royalty over the Etango Project to RCF comprising A$2 million in cash and extinguishment
of the residual convertible notes held by RCF (comprising A$4 million); and
(cid:131) A$3 million capital raising through an equity placement of approximately 63.3 million new Bannerman shares to
RCFVI at A$0.0474 per share.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
6
DIRECTORS’ REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
TSX De-Listing
During the year, Bannerman made an application to the Toronto Stock Exchange (“TSX”) to de-list Bannerman’s
securities. The Company’s securities no longer traded on the TSX after close of trading on Wednesday 11 May 2016.
No change occurred to the quotation and trading of Bannerman shares on the Australian Securities Exchange
(“ASX”) or the Namibian Stock Exchange (“NSX”) and Bannerman’s securities remain available for trading on the ASX
and NSX under the code BMN.
ETANGO URANIUM PROJECT (BANNERMAN 100%)
located
Overview
The Etango Project is one of the
undeveloped
world’s
largest
uranium deposits,
in the
Erongo uranium mining region of
Namibia which hosts the Rössing
and Langer-Heinrich mines and the
Husab Project which
is currently
under construction by the Chinese
state owned enterprise, China
General Nuclear Power Company
(CGNPC). Etango is 73km by road
from Walvis Bay, one of southern
Africa’s busiest deep-water ports
through which uranium has been
exported for over 35 years. Road,
rail, electricity and water networks
are all located nearby.
DFS (completed in 2012)
Bannerman completed the DFS and Environmental and Social Impact Assessment (“ESIA”) on the Etango project in
2012. The respective studies, as announced to the market on 10 April 2012, confirmed the technical, economic and
environmental viability of the project at historical term uranium prices.
DFS Optimisation Study (“OS”) (completed in 2015)
The OS focused on the geology and mine planning aspects of the DFS and updated the Capital and Operating cost
estimates to 2015 financial terms. The study was announced to the market on the 11 November 2015 and strongly
enhanced the financial viability of the Etango project. The key outcomes of the study are compared with the DFS in
the table below:
Item
Base Case Uranium Price
Mine Life
Total Mined Ore
Life-of-mine stripping ratio
Annual Processing Throughput
Processed grade
Processed grade (First 5 years of full production)
Processing recovery
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
Units
US$/lb U3O8
Years
Mt
DFS
Optimisation
Study
Definitive
Feasibility
Study
% Change
75
15.7
303
75
15.0
280
-
4%
8%
Waste : Ore
2.78 : 1
3.34 : 1
-17%
Mt of ore
ppm U3O8
ppm U3O8
%
20
195
241
86.9
20
194
207
86.9
-
-
+16%
-
7
DIRECTORS’ REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
Item
Units
DFS
Optimisation
Study
Definitive
Feasibility
Study
% Change
Ave. Annual Production for first 5 full production years
Mlbs U3O8 pa
Average Annual Production (U3O8)
Life-of-mine Production (U3O8)
Pre-production Capital Expenditure
Sustaining Capital Expenditure
Average Cash Operating Cost for first 5 years
Average Cash Operating Cost for life-of-mine
Net cash flow breakeven uranium price
Payback (from first production)
Mineral Resource Estimates
Mlbs U3O8 pa
Mlbs U3O8
US$ million
US$ million
US$/lb U3O8
US$/lb U3O8
US$/lb U3O8
Years
9.18
7.20
113
793
282
33
38
52
4.4
7.92
6.90
104
870
381
41
46
61
6.0
+16%
+4%
+9%
-9%
-26%
-20%
-17%
-15%
-27%
The Mineral Resource Estimate was updated to include 3,419 metres of additional drilling not incorporated in the
DFS models.
Uranium mineralization has been defined inside grade envelopes by categorical indicator kriging using a lower cut-
off grade of 50 ppm U3O8 and lithological constraints.
In addition, the update considered the relevant operational aspects associated with open pit uranium mining, most
notably the established practice of radiometric haul truck scanning as a means of discriminating between ore and
waste material at the haul truck payload level. Uniform Conditioning (UC) was employed to model the selectivity
associated with this mining method.
The updated Mineral Resource (which includes Ore Reserves) formed the basis of the optimization study and is
tabulated below:
Mineral Resource
Nov 2015
Measured
Indicated
Inferred
Deposit
Cut Off
Tonnes
Grade
In-situ
Tonnes
Grade
In-situ
Tonnes
Grade
In-situ
(Mt)
(U3O8
ppm)
U3O8
(Mlbs)
(Mt)
(U3O8
ppm)
U3O8
(Mlbs)
(Mt)
(U3O8
ppm)
U3O8
(Mlbs)
33.7
194
14.4
362
188
150.2
144.5
85.1
33.6
196
166
166
182
62.5
31.3
12.3
106.1
Total
33.7
194
14.4
362
188
150.2
263.2
Note 1: Refer to the Competent Persons Statement on page 29 for further information on the Etango Mineral Resource Estimate. The Etango
estimate has been reported in accordance with JORC 2012. The figures may not add due to rounding.
Note 2 & 3: Refer to the Competent Persons Statement on page 29 for further information on the Ondjamba and Hyena Mineral Resource
Estimates. The Ondjamba and Hyena estimates remain unchanged from the previous declaration and therefore have been reported in accordance
with JORC 2004. The figures may not add due to rounding.
Ore Reserve Estimates
As part of the OS, Bannerman updated the Ore Reserve Estimate which incorporated the following changes from the
DFS:
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
8
Grade
(U3O8
ppm)
55
100
100
Etango1
Ondjamba2
Hyena3
DIRECTORS’ REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(cid:120) Updating the Mineral Resource model (as detailed above),
(cid:120) Updating the operating cost estimates,
(cid:120) Updating the capital cost estimates, and
(cid:120) Updated mining studies including revised open pit designs (including geotechnical review) and mine
schedules.
The updated Ore Reserve Estimate is tabulated below.
Ore Reserve
Nov 2015
Proved
Probable
Total
Deposit
Cut Off
Tonnes
Grade
In-situ
Tonnes
Grade
In-situ
Tonnes
Grade
(Mt)
(U3O8
ppm)
U3O8
(Mlbs)
(Mt)
(U3O8
ppm)
U3O8
(Mlbs)
(Mt)
(U3O8
ppm)
Grade
(U3O8
ppm)
In-situ
U3O8
(Mlbs)
Etango
55
32.3
196
14
271
194
116.1
303.3
195
130.1
Regulatory Approvals
Bannerman currently holds Exclusive Prospecting Licence 3345 (EPL 3345) in Namibia.
On 4 July 2016, the Company announced that the MME has endorsed the renewal of EPL 3345. The licence has been
renewed until 25 April 2017 in accordance with its original term.
The Ministry of Environment and Tourism granted Bannerman initial Environmental Clearances for the Etango
Project in 2010 and for the project’s Linear Infrastructure in 2012, both of which are important pre-requisites for a
Mining Licence. A renewal for the Etango Project Environmental Clearance was granted in November 2015 for a
further 3 years while the renewal for the project’s Linear Infrastructure Environmental Clearance was granted in
May 2016 also for a further 3 years.
The Company also announced on 4 July 2016 that correspondence had been received from the MME stating that the
Honourable Minister intends to refuse the application for the Etango project Mining Licence, which was applied for
in December 2009, citing the current low uranium price. The Honourable Minister’s decision is not unexpected and
Bannerman retains the right to re-apply for a mining licence when the uranium market recovers.
Heap Leach Demonstration Plant Program
In September 2014, Bannerman awarded the major contracts to construct and operate the Etango heap leach
demonstration plant. Activities at the site commenced in October 2014 and construction was completed in March
2015. The demonstration plant program commenced in April 2015 and is an integral step of the Etango Uranium
Project’s engineering and financing phases. It is specifically aimed at demonstrating the design and projected
performance reflected in the DFS, further enhancing the project knowledge and pursuing value engineering. The
results to date have already gone a significant way towards achieving these objectives.
The demonstration program schedule and objectives are summarised in the Table below:
Phase
Objective(s)
Activities
1
Commissioning
Commissioning of Plant.
Validate leaching assumptions
in DFS.
Open cycle operation of all cribs and
columns.
2
Heap Leaching
Demonstrate consistent
operation of plant.
Validate leaching assumptions
in DFS.
Identify issues and correct plant and
operating procedures as required.
Operate 2 cribs and 4 columns.
Utilize same blended sample in both cribs.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
Schedule
June 2015
Quarter
(Completed)
September
2015 Quarter
(Completed)
9
DIRECTORS’ REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
3
Solution Recycle
4
Solvent Extraction
& Value
Engineering
5
Value Engineering
Simulate the heap leach pad
cycle to generate Pregnant
Leach Solution (PLS).
Assess the possible impacts of
the build-up of deleterious
elements emanating from the
recycling of solution.
Demonstrate the solvent
extraction process and
assumptions in the DFS.
Conduct optimisation studies.
Conduct optimisation studies
Operate three cribs in closed cycle.
Analyse the possible build-up of deleterious
elements.
Generate and store sufficient PLS to enable
the validation of SX assumptions in Phase 4.
December
2015 Quarter
(Completed)
Operate SX plant in laboratory in
Swakopmund.
Primarily utilise 8 columns to evaluate
various opportunities to improve the project
economics.
Primarily utilise 8 columns to evaluate
various opportunities to improve the project
economics.
March 2016
Quarter
(Completed)
June 2016
Quarter
Key observations, results and preliminary conclusions are as follows:
1. Demonstrating the design and projected performance reflected in the Definitive Feasibility Study (“DFS”)
(cid:120) Fast and high average leach extraction were achieved in all phases of the demonstration plant. As expected
the leach extractions were higher during the open circuit leaching than during the closed circuit leaching.
The latter which ultimately informs the project metallurgical assumptions.
(cid:120) These open circuit extraction values ranged from 92.2% to 94.5% whilst the closed circuit extraction values
ranged from 92.5% to 93.0%. The average extraction for the three cribs operated in closed circuit was
92.8% (compared to the DFS projection for a scaled up heap of 86.9%). The associated six columns recorded
an average uranium extraction of 93.0% also operating in closed circuit.
(cid:120) Average sulphuric acid consumption for the closed circuit trials was 13.6 kg/tonne (compared to the DFS
projection of 17.6kg/tonne) for the cribs whilst the columns recorded an acid consumption of 14.2
kg/tonne.
(cid:120) The leach solution collected was clear and clean and subsequent visual observations during the unloading of
the cribs confirmed uniform percolation through the material and integrity of the agglomerate.
(cid:120) The clarity of the solution raises an issue regarding the need for the two pinbed clarifiers currently included
in the DFS processing flowsheet.
(cid:120) Analysis indicated no evidence of build-up of deleterious elements occurring during the recycling of leach
solution.
2.
Further enhancing project knowledge
(cid:120) Operation of the demonstration plant fostered a more complete understanding of the leach kinetics
associated the Etango ore, in particular the management of oxidant demand during the leaching process.
(cid:120) The total sample tested in Phase 1 through to Phase 3 amounted to approximately 273 tonnes significantly
increasing the confidence in the metallurgical assumptions.
3. Pursuing value engineering
(cid:120)
It was evident during the trials that rapid and uniform percolation, coupled with rapid and high leach
extraction at a larger scale point towards the potential to further improve project economics, potentially
through lower acid consumption.
(cid:120) No noticeable reduction in leach extraction performance was observed between the larger scale cribs and
the smaller columns whilst operating in closed circuit. This poses the question as to the appropriate scale up
factors to be used in the detailed engineering of the heap leach operation.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
10
DIRECTORS’ REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
Project Financing
The continued support of RCF as a strategic cornerstone investor in Bannerman, from the existing investment of RCF
IV in 2008 to the continuing investment by RCF VI is a beneficial and positive progression of its investment in
Bannerman.
The results from the successful Demonstration Plant Program strongly support the heap leach assumptions and
projections incorporated in the DFS, and are expected, therefore, to enhance the bankability of the project. The
program scheduled for the coming quarters will focus on further value engineering work.
CONSOLIDATED RESULTS
The consolidated net loss after tax for the 12 months ending 30 June 2016 was $152,000 (2015: $4,241,000) was
attributable primarily to the gain recognised on extinguishment of the convertible notes, offset by corporate and
administrative expenses, borrowing costs and non-cash share-based compensation expenses.
Corporate, administration, personnel and other expenses for the reporting period were $4,753,000 (2015:
$4,830,000), including employee and director share-based payment expense of $540,000 (2015 expense: $535,000).
Refer to the Remuneration Report and Note 21 of the financial report for further details on share-based payments.
Income for the reporting period included interest income of $30,000 (2015: $75,000). During the year, the Company
received research and development incentive funds of $145,000 (2015: $500,000).
Capitalised exploration and evaluation expenditure was $48,759,000 as at 30 June 2016 (2015: $61,262,000)
reflecting the capitalisation of costs relating to the Etango Project heap leach demonstration plan construction and
operation, feasibility study, resource definition drilling and assaying, and other exploration and evaluation costs, net
of foreign currency translation movements and sale of a royalty. Total additions for the year amounted to
$1,516,000 (2015: $3,289,000). A foreign exchange translation reduction of $8,502,000 (2015: increase of
$3,074,000), resulting in an decrease in carrying value, was also recorded for the year. This adjustment reflects the
strengthening of the Australian $ against the Namibian $ over the year. Also a credit of $5,517,000 (2015: $nil)
relating to the sale of a royalty over the Etango project which represents its fair value at the date of the completion
of the transaction.
Cash Position
Cash and cash equivalents were $1,600,000 as at 30 June 2016 (2015: $2,291,000).
Cash outflow from operating activities during the year amounted to $3,145,000 (2015: $1,526,000).
Cash outflow from investing activities during the year amounted to $568,000 (2015: $3,146,000), related primarily to
the operation heap leach demonstration plant and optimisation study and acquisition of the minority interest in the
Etango Project, offset by the receipt from the sale of a royalty over the Etango Project.
Cash inflow from financing activities during the year amounted to $3,000,000 (2015: $1,855,000), related to the $3
million share placement undertaken during the year.
Issued Capital
Issued capital at the end of the financial year amounted to $129,634,000 (2015: $119,468,000). The increase of
$10,666,000 (2015: $2,738,000) related to the issue of 20,918,000 shares in satisfaction of interest and the issue of
106,667,000 shares in conversion in December 2015 of the Company’s convertible notes held by RCF IV and RCF VI,
63,291,000 shares in relation to the $3 million share placements and 123,425,000 shares issues for acquisition of
20% of the Etango Project in December 2015.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
11
DIRECTORS’ REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS
Other than items already noted elsewhere in this report, there were no additional significant changes in the state of
affairs of the Group during the financial year.
LIKELY DEVELOPMENTS AND EXPECTED RESULTS OF OPERATIONS
Likely developments in the operations of the Group are set out in the “Etango Uranium Project” on page 7 - 10 of
this report.
Disclosure of any further information has not been included in this report, because, in the reasonable opinion of the
Directors, to do so would be likely to prejudice the business activities of the Group.
MATTERS SUBSEQUENT TO THE END OF THE FINANCIAL YEAR
No other matters or circumstances have arisen since the end of the financial period which significantly affected or
may significantly affect the operations of the Consolidated Entity, the results of those operations, or the state of
affairs of the Consolidated Entity in future financial years.
SHARE OPTIONS / PERFORMANCE RIGHTS
Share Options / Performance Rights on Issue
Details of share options and performance rights in Bannerman as at the date of this report are set out below:
Security Type
Number
Exercise price
Expiry date
Share Options
Share Options
Share Options
Share Options
Share Options
Share Options
Performance Rights
Performance Rights
Performance Rights
Performance Rights
Performance Rights
Performance Rights
Performance Rights
4,504,000
3,664,400
7,846,000
6,000,000
9,000,000
9,000,000
3,086,271
1,345,645
500,000
250,000
250,000
7,464,542
7,689,200
$0.072
$0.089
$0.044
$0.045
$0.057
$0.07
n/a
n/a
n/a
n/a
n/a
n/a
n/a
22 November 2016
15 November 2017
15 November 2018
25 July 2019
25 July 2019
25 July 2019
15 November 2016
22 November 2016
1 January 2017
1 March 2017
1 June 2017
15 November 2017
15 November 2018
Share Options and Performance Rights issued
During the financial year 27,846,000 share options (2015: 3,664,400) and 27,751,400 performance rights (2015:
10,717,388) were issued. Subsequent to year end, 4,000,000 share options and 1,000,000 performance rights were
issued.
No share option or performance rights holder has any right under the share options or rights to participate in any
other share issue of the Company or any other entity.
Share options exercised
During or since the end of the financial year, no share options (2015: nil) were exercised.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
12
DIRECTORS’ REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
Performance Rights vested
During or since the end of the financial year, 12,759,714 performance rights (2015: 3,809,606) vested.
Share Options and Performance Rights forfeited or cancelled
During or since the end of the financial year, no share options (2015: 1,500,000) and 15,481,239 performance rights
(2015: 2,355,754) were forfeited or cancelled.
Share Options expired or lapsed
During or since the end of the financial year, 1,795,200 share options (2015: 902,500) have expired or lapsed.
ENVIRONMENTAL DISCLOSURE
The Group is subject to various laws governing the protection of the environment in matters such as air and water
quality, waste emission and disposal, environmental impact assessments, mine rehabilitation and access to, and the
use of, ground water. In particular, some activities are required to be licensed under environmental protection
legislation of the jurisdiction in which they are located and such licenses include requirements specific to the subject
site.
So far as the directors are aware, there have been no material breaches of the Company’s licence conditions, and all
exploration activities have been undertaken in compliance with the relevant environmental regulations.
INDEMNITIES AND INSURANCE OF DIRECTORS AND OFFICERS
During the financial year, the Company paid a premium to insure the directors and officers of the Group against
liabilities incurred in the performance of their duties. Under the terms and conditions of the insurance contract, the
nature of liabilities insured against and the premium paid cannot be disclosed.
The officers of the Group covered by the insurance policy include any person acting in the course of duties for the
Group who is, or was, a director, executive officer, company secretary or a senior manager within the Group.
The liabilities insured are legal costs that may be incurred in defending civil or criminal proceedings that may be
brought against the officers, in their capacity as officers, of entities in the Group, and any other payments arising
from liabilities incurred by the officers in connection with such proceedings. This does not include such liabilities
that arise from conduct involving a wilful breach of duty by the officers or the improper use by the officers of their
position or of information to gain advantage for themselves or someone else or to cause detriment to the Group. It
is not possible to apportion the premium between amounts relating to the insurance against legal costs and those
relating to other liabilities.
INDEMNIFICATION OF AUDITORS
To the extent permitted by law, the Company has agreed to indemnify its auditors, Ernst & Young, as part of the
terms of its audit engagement agreement against claims by third parties arising from the audit (for an unspecified
amount). No payment has been made to indemnify Ernst & Young during or since the financial year.
PROCEEDINGS ON BEHALF OF THE GROUP
At the date of this report, there are no leave applications or proceedings brought on behalf of the Group under s237
of the Corporations Act 2001.
DIVIDENDS
No dividend has been declared or paid during the year (2015: nil).
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
13
DIRECTORS’ REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
ROUNDING
The amounts contained in this report and in the financial report have been rounded to the nearest $1,000 (where
rounding is applicable and where noted ($’000)) under the option available to the Company under ASIC Corporations
(Rounding in Financial/Directors’ Reports) Instrument 2016/191. The Company is an entity to which the Class Order
applies.
NON-AUDIT SERVICES
In accordance with the Company’s External Auditor Policy, the Company may decide to engage the external audit
firm on assignments additional to its statutory audit duties where the auditor’s expertise and experience with the
Group are important.
Details of the amounts paid or payable to the auditor, Ernst & Young, for audit and non-audit services provided
during the financial year are set out in Note 5 of the financial report.
The Board of directors, in accordance with advice received from the Audit Committee, is satisfied that the provision
of the non-audit services detailed in Note 5 of the financial report is compatible with the general standard of
independence for auditors imposed by the Corporations Act 2001. The directors are also satisfied that the provision
of these non-audit services did not compromise the auditor independence requirements of the Corporations Act
2001 because:
(cid:120)
they have no reason to question the veracity of the auditor’s independence declaration referred to in the
section immediately following this section of the report; and
the nature of the non-audit services provided is consistent with those requirements.
(cid:120)
AUDITOR’S INDEPENDENCE DECLARATION
Ernst & Young continues as external auditor in accordance with s327 of the Corporations Act 2001. The auditor’s
independence declaration as required under s307C of the Corporations Act 2001 is set out below and forms part of
this report.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
14
Ernst & Young
11 Mounts Bay Road
Perth WA 6000 Australia
GPO Box M939 Perth WA 6843
Tel: +61 8 9429 2222
Fax: +61 8 9429 2436
ey.com/au
Auditor’s Independence Declaration to the Directors of Bannerman Resources
Limited
As lead auditor for the audit of Bannerman Resources Limited for the year ended 30 June 2016, I declare
to the best of my knowledge and belief, there have been:
a. no contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit; and
b. no contraventions of any applicable code of professional conduct in relation to the audit.
This declaration is in respect of Bannerman Resources Limited and the entities it controlled during the
financial period.
Ernst & Young
Robert A Kirkby
Partner
13 September 2016
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
RK:JH:BMN:035
DIRECTORS’ REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
REMUNERATION REPORT (AUDITED)
INTRODUCTION AND REMUNERATION STRATEGY
The Board of Bannerman is committed to providing a remuneration framework that is designed to attract, motivate
and maintain appropriately qualified and experienced individuals whilst balancing the expectations of shareholders.
The Company’s remuneration policies are structured to ensure a link between Company performance and
appropriate rewards, and remuneration for executives involves a combination of both fixed and variable (“at risk”)
remuneration, including long term incentives to drive the Company’s desired results.
In developing the Company’s remuneration policy, the Board remains focussed on competitive remuneration
packages and long term equity plans, which reward executives for delivering satisfactory performance to
shareholders. In this regard, Bannerman has developed equity rewards based on performance hurdles that deliver
returns for shareholders.
SUMMARY
The remuneration report summarises the remuneration arrangements for the reporting period 1 July 2015 to
30 June 2016 for the directors and executives of Bannerman and the Group in office during the financial year.
The information provided in this remuneration report has been audited as required by s308(3C) of the Corporations
Act 2001.
KEY MANAGEMENT PERSONNEL
For the purpose of this report, key management personnel of the Group (as defined in AASB 124 Related Party
Disclosures) are those persons identified in this section who have authority and responsibility for planning, directing
and controlling the activities of the Group, whether directly or indirectly, including any director (whether executive
or otherwise) of the parent entity.
The directors and executives considered to be key management personnel of the Group up to the date of this report
are the directors and executives set out in Table 1 below.
Period
Full
Full
Full
Full
Table 1 - Key management personnel
Name
Position
Non-Executive Directors
Ronnie Beevor
Ian Burvill
Clive Jones
David Tucker
Executive Director
Brandon Munro
Len Jubber
Other Executive Personnel
Werner Ewald
Non-Executive Chairman
Non-Executive Director
Non-Executive Director
Non-Executive Director
Chief Executive Officer and Managing Director
Chief Executive Officer and Managing Director
Since 9 March 2016
To 8 March 2016
Managing Director - Namibia
Full
1. PRINCIPLES USED TO DETERMINE THE NATURE AND AMOUNT OF REMUNERATION
Board Remuneration, Nomination and Corporate Governance Committee
The Remuneration Committee assists the Board to fulfil its responsibilities to shareholders by ensuring the Group
has remuneration policies that fairly and competitively reward executives and the broader Bannerman workforce.
The Remuneration Committee’s decisions on reward structures are based on the current competitive environment,
remuneration packages for executives and employees in the resources industry and the size and complexity of the
Group.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
16
DIRECTORS’ REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
The Remuneration Committee’s responsibilities include reviewing the Company’s remuneration framework and
evaluating the performance of the CEO and monitoring the performance of the executive team.
Independent remuneration consultants are engaged by the Remuneration Committee from time to time to ensure
the Company’s remuneration system and reward practices are consistent with market practices. No remuneration
consultants were used in the current year.
Directors’ remuneration policy and structure
Bannerman’s non-executive director remuneration policy aims to reward non-executive directors fairly and
responsibly having regard to the:
(cid:120)
(cid:120)
(cid:120)
level of fees paid to directors relative to other comparatively sized exploration and mining companies;
size and complexity of Bannerman’s operations; and
responsibilities and work requirements of individual Board members.
Fees paid to the non-executive directors of Bannerman are usually reviewed annually by the Remuneration
Committee, and based on periodic advice from external remuneration consultants. The Board decided that in light
of the operating environment it was appropriate that non-executive director remuneration remained unchanged for
the current year.
Directors’ remuneration limits
Non-executive directors’ fees are determined within an aggregated directors’ annual fee limit of $750,000, which
was last approved by shareholders on 17 September 2008.
Directors’ remuneration framework
Non-executive directors’ remuneration consists of base fees (inclusive of superannuation); annual grants of share
rights or share options; and audit committee chairman fees, details of which are set out in Table 2 below. Non-
executive directors may also receive an initial grant of share rights or share options at the time of joining the Board.
Board fees are not paid to the executive director as the time spent on Board work and the responsibilities of Board
membership are considered in determining the remuneration package provided as part of his normal employment
conditions.
Table 2 – Annual Board and committee fees payable to non-executive directors
Year ended
30 June 2016
Year ended
30 June 2015
Year ending
30 June 2017
Position
Chairman of the Board
Non-Executive Director
Additional fees for:
Chairman of the Audit Committee
Share Options /
Performance
Rights
$
50,000
25,000
Cash
$
100,000
50,000
Share Options /
Performance
Rights
$
60,000
30,000
Share Options /
Performance
Rights
$
90,000
45,000
Cash
$
60,000
30,000
Cash
$
90,000
45,000
10,000
-
9,000
1,000
6,000
4,000
Note:
(cid:120) Mr Ian Burvill elected not to receive the cash component of his fee effective 1 January 2013.
(cid:120)
Share options and rights issued to non-executive directors vest after a 12 month period.
(cid:120)
On 1 April 2016, the Board elected to decrease the cash component of their remuneration by 40%, and replaced it with
Share Options or Performance Rights of equivalent value.
No fees are payable for being a member of a committee or for being the Chairman of a committee other the Chairman of
the Audit Committee.
(cid:120)
No retirement benefits are paid other than the statutory superannuation contributions of 9.5% required under
Australian superannuation guarantee legislation.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
17
DIRECTORS’ REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
The Non-Executive Director Share Incentive Plan (“NEDSIP”), as approved by shareholders on 25 July 2016, allows
for the provision of either share rights or share options to directors. Under the NEDSIP, the Company’s non-
executive directors will receive one-third of their director's fees plus the equivalent of 40% of the cash component of
their director’s fees in the form of either share rights or share options. The directors consider that the issue of share
rights or share options to non-executive directors as part of their remuneration package is reasonable and
appropriate given:
(a)
(b)
it is a cost effective and efficient reward for service. The issue of share rights or share options in lieu of cash
payments preserves the Company’s cash resources and reduces on-going costs which is a significant aspect
while the Company remains in a development phase; and
in part, it aligns remuneration with the future growth and prospects of the Company and the interests of
shareholders by encouraging non-executive director share ownership.
Refer to Table 7 in Section 4 for details of the number and value of share options and share rights issued to non-
executive directors during the year.
As part of the Company’s Securities Trading Policy, the Company prohibits directors from entering into
arrangements to protect the value of unvested incentive awards. This includes entering into contracts to hedge
exposure to share options, share rights or shares granted as part of their remuneration packages.
The Board assesses the appropriateness, nature and amount of remuneration paid to non-executive directors on a
periodic basis, including the granting of equity based payments, and considers it appropriate to grant share options
or share rights to non-executive directors with the overall objective of retaining a high quality Board whilst
preserving cash reserves.
Executive remuneration policy and structure
Bannerman’s executive remuneration policy is designed to reward the CEO and other senior executives. The main
principles underlying Bannerman’s executive remuneration policy are to:
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
provide competitive rewards to attract, retain and motivate executives;
set levels of performance which are clearly linked to an executive’s remuneration;
structure remuneration at a level which reflects the executive’s duties and accountabilities;
set a competitive level of remuneration that is sufficient and reasonable;
align executive incentive rewards with the creation of value for shareholders; and
comply with applicable legal requirements and appropriate standards of governance.
Executive remuneration structure
Bannerman’s remuneration structure for the CEO and senior executives for the year ended 30 June 2016 was
divided into two principal components:
(cid:120)
(cid:120)
base pay and benefits, including superannuation; and
variable annual reward, or “at risk” component, by way of the issue of long term share-based incentives.
Performance reviews for all senior executives are conducted on an annual basis. The performance of each senior
executive is measured against pre-determined key performance indicators. The most recent performance reviews
were completed in November 2015.
Base pay
The base pay component of executive remuneration comprises base salary, statutory superannuation contributions
and other allowances where applicable. It is determined by the scope of each executive’s role, working location,
level of knowledge, skill and experience along with the executive’s individual performance. There is no guarantee of
base pay increases included in any executive’s contract.
Bannerman benchmarks this component of executive remuneration against appropriate market comparisons using
information from similar companies and, where applicable, advice from external consultants.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
18
DIRECTORS’ REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
Short-term incentive component (STI)
During the year there were no STI awards granted.
Long-term incentive component (LTI)
The LTI awards are aimed specifically at creating long term shareholder value and the retention of employees. The
Company has implemented an Employee Incentive Plan (“EIP”) which enables the provision of share options or
performance rights to executives and employees.
During the 2016 financial year, performance rights which will vest subject to pre-defined performance hurdles were
allocated to all executives. The grant of performance rights aims to reward executives in a manner that aligns
remuneration with the creation of shareholder wealth. Refer to Table 7 in Section 4 for the number and value of
performance rights issued to executives during the year.
Performance measures to determine vesting
The vesting of half of the performance rights is subject to the Company’s relative Total Shareholder Return (“TSR”)
as measured by share price performance (allowing for the reinvestment of dividends) over the life of the
performance rights, versus a comparator group of uranium development companies. The vesting of the other half is
subject to the attainment of defined individual and group performance criteria, chosen to align the interests of
employees with shareholders, representing key drivers for delivering long term value. Group and individual
performance measures are weighted and specify performance required to meet or exceed expectations. The
performance measures for the 2016 performance rights related to:
Safety - total recordable incidents and significant environmental incidents.
(cid:120)
(cid:120) Operational – execution of company development and operational plans.
(cid:120)
(cid:120) Regulatory - obtaining timely renewal of licences.
(cid:120)
Corporate - execution of transactions mandated by the Board.
Capital - maintaining adequate working capital and achieving operating budgets.
Relative TSR was selected as a LTI performance measure given it ensures an alignment between comparative
shareholder return and reward for executives, and minimises the effects of market cycles and commodity price
changes.
The comparator group includes the following uranium development companies:
A-Cap Resources
Aura Energy Limited
Azarga Uranium Corp.
Berkeley Resources Limited
Deep Yellow Limited
Energy Fuels Inc.
Forsys Metals Corp.
Kivalliq Energy Corporation
Laramide Resources Limited
Mega Uranium Limited
Plateau Uranium Inc.
Peninsula Energy Limited
Toro Energy Limited
U3O8 Corp.
Uranium Resources Inc
Ur-Energy Inc.
Vimy Resources Limited
The Board has updated, in 2016, the members of the comparator group to ensure it is reflective of the Company’s
peers. The limitation to uranium-focused development companies seeks to ensure that the TSR calculation is not
materially impacted by price movements of other commodities.
The comparator group is composed of Australian and foreign uranium development companies chosen to reflect the
Group's competitors for capital and talent. The Group's performance against the measure is determined according
to Bannerman's ranking against the companies in the TSR group over the performance period. The vesting schedule
is as follows:
Table 3 – TSR Vesting Schedule
Relative TSR performance outcome
Below or at the 25th percentile
Between the 25th and 75th percentile
At or above the 75th percentile
Percentage of award that will vest
0%
Scale applicable whereby every 1 percentile equates to 2% vesting
100%
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
19
DIRECTORS’ REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
Termination and change of control provisions
Where an executive ceases employment prior to the vesting of an award, the incentives are forfeited unless the
Board applies its discretion to allow vesting at or post cessation of employment in appropriate circumstances.
In the event of a change of control of the Group, the performance period end date will generally be brought forward
to the date of the change of control and the share options and rights will vest in full, subject to ultimate Board
discretion.
No hedging of LTIs
As part of the Company’s Securities Trading Policy, the Company prohibits executives from entering into
arrangements to protect the value of unvested LTI awards. This includes entering into contracts to hedge exposure
to share options, performance rights or shares granted as part of their remuneration package.
2. DETAILS OF REMUNERATION
Non-Executive Directors’ Remuneration
Details of the nature and amount of remuneration of Bannerman’s non-executive directors for the year ended 30
June 2016 are as follows:
Share
Based
Payments
Options /
Rights
$
Total
Performance
Related
$
%
Table 4 – Non-executive director remuneration
Short-term
Post
Employment
Sub-total
Non-Executive Directors
Ronnie Beevor
Ian Burvill (i)
Clive Jones
David Tucker
Total
Year
2016
2015
2016
2015
2016
2015
2016
2015
2016
2015
Base
Fees
$
90,000
100,000
-
-
41,095
45,662
21,357
20,876
152,452
166,538
Other
$
Superannuation
$
$
-
-
-
-
-
-
9,000
10,000
9,000
10,000
-
-
-
-
3,905
4,338
23,643
29,124
27,548
33,462
90,000
100,000
-
-
45,000
50,000
54,000
60,000
189,000
210,000
45,723
50,176
22,861
25,089
22,861
25,089
20,095
25,089
111,540
125,443
135,723
150,176
22,861
25,089
67,861
75,089
74,095
85,089
300,540
335,443
-
-
-
-
-
-
-
-
-
-
(i) Mr Ian Burvill elected not to receive the cash component of his fee effective 1 January 2013.
(ii) On 1 April 2016, the Board elected to decrease the cash component of their remuneration by 40%, and replaced with Share
Options or Performance Rights of equivalent value.
The category of “Other” includes payments for Chairman of the Audit Committee as well as extra services and
consultancy fees for specific duties, as approved by the Board.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
20
DIRECTORS’ REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
Executive Remuneration
Details on the nature and amount of remuneration of Bannerman’s executives for the year ended 30 June 2016 are
as follows.
Table 5 – Executive remuneration
Short–term
Post
Employment
Sub-total
Year
Salary &
Fees
$
Other
$
Superannuation
$
$
Executive Director
Brandon Munro (i)
Len Jubber (ii)
2016
2015
2016
2015
Other Executive Personnel
2016
Werner Ewald (iii)
2015
2016
2015
Total
62,617
-
251,450
365,297
-
-
100,000
-
142,458
164,393
456,525
529,690
49,878
47,734
149,878
47,734
5,949
-
41,239
34,703
39,852
37,309
87,040
72,012
68,566
-
392,689
400,000
232,188
249,436
693,443
649,436
Share
Based
Payments
Options /
Performance
Rights
$
88,085
-
112,976
216,445
96,658
104,285
297,719
320,730
Total
Performance
Related
$
156,651
-
505,665
616,445
328,846
353,721
991,162
970,166
%
56.2
-
22.3
35.1
29.4
29.5
-
-
(i) Mr Munro commenced employment on 9 March 2016.
(ii) Mr Jubber resigned effective 8 March 2016. The category of “Other” includes payments for notice in lieu.
(iii) Mr Ewald’s contract is denominated in Namibian dollars.
3. SERVICE AGREEMENTS
On appointment to the Board, all non-executive directors enter into a service agreement with the Company in the
form of a letter of appointment. The letter summarises the Board policies and terms, including compensation.
Remuneration and other terms of employment for the CEO and the other executives are also formalised in service
agreements. Major provisions of the agreements relating to remuneration are summarised below.
Remuneration of the Chief Executive Officer(s)
Mr Munro was appointed on 9 March 2016 as CEO and Managing Director. Under the employment contract with Mr
Munro, he is entitled to receive an annual salary, superannuation, and LTI awards (grant of share options or
performance rights, which are subject to performance hurdles). Details of Mr Munro’s contract and remuneration
are follows:
Annual Salary
Mr Munro’s annual salary is $220,000 per annum inclusive of 9.5% superannuation. Upon achieving certain key
performance indicators, Mr Munro’s salary may increase to $300,000 per annum inclusive of 9.5% superannuation
at the Board’s discretion.
Short term incentives
No short term incentive is payable.
Long term incentives
Mr Munro’s employment contract provided for the grant of 20,000,000 share options, subject to shareholder
approval, which was duly obtained on 25 July 2016. Mr Munro also participated in a share placement of 2,000,000
ordinary shares at $0.03.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
21
DIRECTORS’ REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
Termination Benefits
Mr Munro is entitled to 6 months’ annual salary if his employment is terminated other than for cause, plus statutory
entitlements for annual leave. The contract also provides that Mr Munro’s employment may be terminated with
three months’ notice by either party.
Mr Jubber was appointed on 17 November 2008 as CEO and Managing Director and resigned effective 8 March
2016. Under the employment contract with Mr Jubber, he was entitled to receive an annual salary, superannuation,
and LTI awards (grant of share options or performance rights, which were subject to performance hurdles). Details
of Mr Jubber’s contract and remuneration were as follows:
Annual Salary
Effective 10 April 2012, following completion of the Board-approved DFS on the Etango Project, Mr Jubber’s annual
salary increased from $400,000 per annum to $462,500 per annum (rate set in 2008), inclusive of 9%
superannuation. Contractually Mr Jubber was entitled to an annual salary of $525,000 upon attainment of
development finance for the Etango Project.
In recognition of the current adverse uranium and capital markets and the resultant low share price, Mr Jubber
voluntarily implemented a 13.5% reduction in his personal remuneration with effect from 1 July 2013.
Short term incentives
No short term incentive is payable.
Long term incentives
During the year, Mr Jubber was granted 13,793,100 performance rights subject to shareholder approval, which was
obtained in December 2015. The performance rights were offered and the terms and conditions were agreed to and
accepted by Mr Jubber. The rights were subject to performance hurdles and lapsed if Mr Jubber left the
employment of the Group and immediately vest in the event of a change of control. As part of Mr Jubber’s
resignation the Board applied its discretion and approved the vesting of 8,040,205 Performance Rights pursuant to
the terms of the Employee Incentive Plan. Refer to Table 7 on page 23.
Termination Benefits
Mr Jubber was entitled to 6 months’ annual salary if his employment was terminated other than for cause, plus
statutory entitlements for annual leave. The contract also provides that Mr Jubber’s employment may be terminated
with three months’ notice by either party. Mr Jubber resigned effective 9 March 2016
Contracts for executives – employed in the Group as at 30 June 2016
A summary of the key contractual provisions for each of the current key management personnel is set out in Table 6
below.
Table 6 - Contractual provisions for executives engaged as at 30 June 2016
Name and job title
Brandon Munro –
CEO & Managing
Director
Werner Ewald –
Managing Director
Namibia
Employing
company
Bannerman
Resources
Limited
Bannerman
Mining
Resources
(Namibia)
(Pty) Ltd
Contract
duration
Notice
period
company
Notice
period
employee
No fixed term
3 months
3 months
No fixed term
3 months
3 months
Termination provision
6 months base salary and
accrued leave entitlements
if terminated by the
Company.
6 months base salary and
accrued leave entitlements
if terminated by the
Company.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
22
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DIRECTORS’ REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
Other remuneration information
Further details relating to share options and rights and the proportion of key management personnel remuneration
related to equity compensation during the year are tabulated below.
Table 8 – Value of share options and performance rights issued and exercised during the year ended 30 June 2016
Type
Proportion of
remuneration
consisting of options /
rights for the year(1)
%
Value of options /
rights granted during
the year(2)
$
Value of options
exercised / rights
vested during the
year(3)
$
Directors
Ronnie Beevor
Brandon Munro(4)
Len Jubber
Ian Burvill
Clive Jones
David Tucker
Executives
Share Options
Share Options
Performance Rights
Share Options
Share Options
Share Rights
34%
56%
22%
100%
34%
27%
Werner Ewald
Performance Rights
29%
50,000
185,693
393,104
25,000
25,000
25,000
147,566
-
-
332,625
-
-
15,677
27,793
(1)
(2)
(3)
(4)
Calculated based on Tables 4 and 5 as the share-based expense for the year as a percentage of total remuneration. The percentage of total
remuneration varies among each director given the impact of consulting or other fees paid during the financial year.
Based on fair value at time of grant per AASB 2. For details on the valuation of the options and rights, including models and assumptions
used, refer to Note 21.
Calculated based on the fair value of the Company’s shares on date of vesting.
The granting of Mr Munro’s options were approved at a Shareholder meeting on 25 July 2016.
Other than detailed above in Table 7 there were no other alterations to the terms and conditions of the share
options / rights awarded as remuneration since their award date.
Table 9 – Share options and performance rights holdings of key management personnel (i)
30 June 2016
Type
Opening
Balance
1 July 2015
Granted as
Remuneration
Exercised /
converted /
lapsed
Net Change
Other
Closing
Balance
30 June
2016
Vested at 30 June 2016
Total
Exercisable
Not
exercisable
Directors
Ronnie Beevor
Brandon Munro
(ii)
Options
4,084,200
3,923,000
Options
-
20,000,000
-
-
-
8,007,200
4,084,200
4,084,200
-
- 20,000,000
5,000,000
Len Jubber
Rights
11,468,070
13,793,100
(10,510,981)
(14,750,189)
-
-
Ian Burvill (iii)
Options
2,725,900
1,961,500
Clive Jones
Options
2,725,900
1,961,500
-
-
(683,800)
4,003,600
2,042,100
2,042,100
(683,800)
4,003,600
2,042,100
2,042,100
David Tucker
Rights
423,700
862,100
(423,700)
-
862,100
-
-
-
-
5,000,000
-
-
-
-
21,427,770
42,501,200
(10,934,681)
(16,117,789) 36,876,500
13,168,400
8,168,400
5,000,000
Executives
Werner Ewald
Rights
4,106,884
4,815,600
(817,436)
(165,440)
7,939,608
4,106,884
4,815,600
(817,436)
(165,440)
7,939,608
-
-
-
-
-
-
(i)
(ii)
(iii)
Includes share options and performance rights held directly, indirectly and beneficially by key management personnel.
These options although vested were not exercisable until shareholder approval, which was obtained on 25 July 2016.
These share options are held by Resource Capital Funds Management Pty Ltd, and are noted above against the relevant RCF
representative director.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
25
DIRECTORS’ REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
Table 10 – Shareholdings of key management personnel (i)
30 June 2016
Directors
Ronnie Beevor
Brandon Munro
Len Jubber (ii)
Ian Burvill
Clive Jones (iii)
David Tucker
Executives
Werner Ewald
Opening
Balance
1 July 2015
Granted as
Remuneration
Received on Exercise
of Share options /
conversion of rights
(Sales)
Purchases
Net Change
Other
Closing
Balance
30 June 2016
2,320,643
-
10,223,828
-
15,495,401
1,889,575
2,627,227
33,171,465
-
-
-
-
-
-
-
-
-
-
10,510,981
-
-
423,700
817,436
11,752,117
-
-
-
-
-
-
-
-
-
-
(21,349,600)
-
61,712,267
-
2,320,643
-
-
-
77,207,668
2,313,275
-
40,362,667
3,444,663
85,286,249
(i) Includes shares held directly, indirectly and beneficially by key management personnel.
(ii) Mr Jubber resigned effective 8 March 2016.
(iii) Net Other Change relates to approximately 123.4 million new shares and A$1 million in cash received as consideration
for the acquisition of the 20% non-controlling interest in the Etango Project.
All equity transactions with key management personnel other than those arising from the exercise of remuneration
share options or asset acquisition share options have been entered into under terms and conditions no more
favourable than those the Group would have adopted if dealing at arm’s length
Table 11 – Shares issued on exercise of performance rights during the year ended 30 June 2016
Shares
issued
#
Paid per
share
$
Unpaid per
share
$
Directors
Len Jubber
David Tucker
Executives
10,510,981
423,700
Werner Ewald
817,436
5. ADDITIONAL INFORMATION
Performance over the Past 5 Years
-
-
-
-
-
-
The objective of the LTI program is to reward and incentivise non-executive directors and executives in a manner
which aligns with the creation of shareholder wealth. Bannerman’s performance during 2015/16 and the previous
four financial years are tabulated in Table 12 below:
Table 12 – Bannerman’s performance for the past five years
Year ended 30 June
Net loss after tax ($’000)
Net assets ($’000)
Market capitalisation ($ ‘000’s) at
30 June
2016
(152)
50,610
2015
(4,241)
53,117
2014
(2,421)
51,086
2013
(5,688)
56,685
2012
(9,600)
64,453
19,000
19,000
23,000
19,000
36,000
Closing share price ($)
$0.027
$0.049
$0.07
$0.06
$0.12
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
26
DIRECTORS’ REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
END OF REMUNERATION REPORT (AUDITED)
This report is made in accordance with a resolution of the directors.
Brandon Munro
CEO and Managing Director
Perth, 13 September 2016
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
27
DIRECTORS’ REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
TECHNICAL DISCLOSURES
Certain disclosures in this report, including management's assessment of Bannerman’s plans and projects, constitute
forward looking statements that are subject to numerous risks, uncertainties and other factors relating to
Bannerman’s operation as a mineral development company that may cause future results to differ materially from
those expressed or implied in such forward-looking statements. Full descriptions of these risks can be found in
Bannerman’s various statutory reports, including its Annual Information Form available on the SEDAR website,
sedar.com. Readers are cautioned not to place undue reliance on forward-looking statements. Bannerman
expressly disclaims any intention or obligation to update or revise any forward-looking statements whether as a
result of new information, future events or otherwise.
Mineral Resources include Ore Reserves (Mineral Reserves).
Mineral Resources which are not Ore Reserves (Mineral Reserves) do not have demonstrated economic viability.
The information in this report relating to the Ore Reserves of the Etango Project is based on information prepared by
Mr Leon Fouché, extracted from the Technical Reports. Mr Fouché is a Fellow of The Australasian Institute of Mining
and Metallurgy. Mr Fouché is a full-time employee of the Company. Mr Fouché has sufficient experience relevant to
the style of mineralisation and types of deposits under consideration and to the activity which is being undertaken
to qualify as a Competent Person as defined in the 2012 Edition of the “Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserves”, and a Qualified Person as defined by Canadian National
Instrument 43-101. Mr Fouché consents to the inclusion in the report of the matters based on his information in the
form and context in which it appears.
The information in this report pertaining to Mineral Resources and Ore Reserves for the Etango deposit is extracted
from the Technical Reports. The company confirms that it is not aware of any new information or data that
materially affects the information included in the original market announcement and, in the case of estimates of
Mineral Resources or Ore Reserves, which all material assumptions and technical parameters underpinning the
estimates in the relevant market announcement continue to apply and have not materially changed. The company
confirms that the form and context in which the Competent Person’s findings are presented have not been
materially modified from the original market announcement.
All material assumptions detailed in this report and underpinning the production target and forecast financial
information in the DFS Optimisation Study (as previously announced on 11 November 2015 in compliance with
Listing Rule 5.16 and 5.17) continue to apply and have not materially changed.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
28
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
Interest revenue
Other income
Employee benefits
Borrowing costs
Compliance and regulatory expenses
Depreciation expense
Other expenses
Loss before income tax
Income tax benefit
Net loss for the year
Note
2
3
4(a)
4(b)
4(c)
6
Other comprehensive income
Items that may be reclassified subsequently to profit or loss
Foreign currency translation
15(b)
Other comprehensive income for the year
Total comprehensive loss
Loss is attributable to:
Equity holders of Bannerman Resources Limited
Non-controlling interest
Total comprehensive loss is attributable to:
Equity holders of Bannerman Resources Limited
Non-controlling interest
Consolidated
2016
$'000
2015
$'000
30
4,426
(1,538)
(1,227)
(315)
(53)
(1,620)
(297)
145
(152)
(8,605)
(8,605)
(8,757)
(113)
(39)
(152)
(8,638)
(119)
(8,757)
75
14
(1,556)
(2,104)
(236)
(88)
(846)
(4,741)
500
(4,241)
2,999
2,999
(1,242)
(4,137)
(104)
(4,241)
(1,162)
(80)
(1,242)
Basic and diluted loss per share to the ordinary equity
holders of the Company (cents per share):
18
(0.02)
(1.21)
The above statement of comprehensive income should be read in conjunction with the accompanying notes.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
29
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
Consolidated
Note
2016
$'000
2015
$'000
CURRENT ASSETS
Cash and cash equivalents
Other receivables
Other
TOTAL CURRENT ASSETS
NON CURRENT ASSETS
Other receivables
Property, plant and equipment
Exploration and evaluation expenditure
TOTAL NON CURRENT ASSETS
TOTAL ASSETS
CURRENT LIABILITIES
Trade and other payables
Provisions
TOTAL CURRENT LIABILITIES
NON CURRENT LIABILITIES
Interest bearing liabilities
Provisions
TOTAL NON CURRENT LIABILITIES
TOTAL LIABILITIES
NET ASSETS
EQUITY
Contributed equity
Reserves
Accumulated losses
TOTAL PARENT ENTITY INTEREST
Non-controlling interest
7
8
8
9
10
11
12
13
14
15
1,600
27
107
1,734
15
722
48,759
49,496
51,230
160
90
250
-
370
370
620
50,610
129,634
22,003
(101,027)
50,610
-
2,291
166
82
2,539
15
872
61,262
62,149
64,688
693
198
891
10,281
399
10,680
11,571
53,117
119,468
35,590
(100,914)
54,144
(1,027)
TOTAL EQUITY
50,610
53,117
The above statement of financial position should be read in conjunction with the accompanying notes.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
30
CONSOLIDATED CASH FLOW STATEMENT
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
Note
Consolidated
2016
$'000
2015
$'000
Cash Flows from Operating Activities
Payments to suppliers and employees
Interest received
R&D tax incentive received
Net cash flows used in operating activities
19
Cash Flows From Investing Activities
Payments for exploration and evaluation
Acquisition of non-controlling interest in exploration project
Sale of a royalty
Purchase of property, plant & equipment
Proceeds from disposal of property, plant & equipment
Net cash flows used in investing activities
Cash Flows from Financing Activities
Proceeds from issue of shares
Transaction costs of financing
Net cash flows provided by financing activities
Net (decrease) / increase in cash and cash equivalents
Cash and cash equivalents at beginning of year
Net foreign exchange differences
Cash and cash equivalents at end of year
7
(3,321)
31
145
(3,145)
(1,542)
(1,000)
2,000
(26)
-
(568)
3,000
-
3,000
(713)
2,291
22
1,600
(2,101)
75
500
(1,526)
(3,124)
-
-
(47)
25
(3,146)
2,000
(145)
1,855
(2,817)
5,112
(4)
2,291
The above cash flow statement should be read in conjunction with the accompanying notes.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
31
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
Issued
Capital
Note 14
Share Based
Foreign
Asset
Convertible
Accumulated
Losses
Payment
Reserve
Currency
Reserve
Revaluation
Reserve
Note
Reserve
Note 15(a)
Note 15(b)
Note 15(c)
Note 15 (d)
Equity
Reserve
Note 15 (e)
Non-
controlling
Interest
Note 27
Total
$’000
$’000
$’000
$’000
$’000
$’000
$’000
$’000
$’000
Balance at 1 July 2015
119,468
(100,914)
54,058
(22,673)
167
4,038
Loss for the period
Other comprehensive loss
Total comprehensive loss for
the period
-
-
-
(113)
-
(113)
Acquisition of Non-
controlling interest
Shares issued during the
period
Share-based payments
3,456
6,710
-
-
-
-
-
-
-
-
-
540
-
(8,525)
(8,525)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(1,027)
53,117
(39)
(80)
(152)
(8,605)
(119)
(8,757)
(5,602)
1,146
(1,000)
-
-
-
-
-
6,710
540
50,610
Total Equity at 30 June 2016
129,634
(101,027)
54,598
(31,198)
167
4,038
(5,602)
Issued
Capital
Note 14
Share Based
Foreign
Asset
Convertible
Accumulated
Losses
Payment
Reserve
Currency
Reserve
Revaluation
Reserve
Note
Reserve
Note 15(a)
Note 15(b)
Note 15(c)
Note 15 (d)
Equity
Reserve
Note 15 (e)
Non-
controlling
Interest
Note 27
Total
$’000
$’000
$’000
$’000
$’000
$’000
$’000
$’000
$’000
Balance at 1 July 2014
116,730
(96,777)
53,523
(25,648)
167
4,038
Loss for the period
Other comprehensive
income / (loss)
Total comprehensive income
/(loss) for the period
-
-
-
(4,137)
-
(4,137)
Shares issued during the
period
Shares issue costs
Share-based payments
2,883
(145)
-
-
-
-
-
-
-
-
-
535
-
2,975
2,975
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Total Equity at 30 June 2015
119,468
(100,914)
54,058
(22,673)
167
4,038
-
-
-
-
-
-
-
-
(947)
(104)
51,086
(4,241)
24
2,999
(80)
(1,242)
-
-
-
2,883
(145)
535
(1,027)
53,117
The above statement of changes in equity should be read in conjunction with the accompanying notes.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
32
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
1. BASIS OF PREPARATION AND ACCOUNTING POLICIES
Corporate Information
This financial report of Bannerman for the year ended 30 June 2016 was authorised for issue in accordance with
a resolution of the directors on 13 September 2016.
Bannerman is a company limited by shares incorporated in Australia whose shares are publicly traded on the
Australian Securities Exchange and the Namibian Stock Exchange.
Basis of Preparation and Accounting Policies
The financial report is a general purpose financial report that has been prepared in accordance with Australian
Accounting Standards, including Australian Accounting Interpretations, other authoritative pronouncements of
the Australian Accounting Standards Board and the Corporations Act 2001. The financial report has also been
prepared on an historical cost basis, except for land and buildings which has been measured at fair value.
The financial report covers the consolidated entity comprising Bannerman and its controlled entities (the
“Group”).
The financial report is presented in Australian dollars and all values are rounded to the nearest thousand dollars
($'000) unless otherwise stated under the option available to the Company under Australian Securities and
Investments Commission (ASIC) Class Order 2016/191. The Company is an entity to which the Class Order
applies.
For the purposes of preparing the consolidated financial statements, the Company is a for-profit entity.
Statement of Compliance
The financial report complies with Australian Accounting Standards as issued by the Australian Accounting
Standards Board and International Financial Reporting Standards ("IFRS") as issued by the International
Accounting Standards Board.
Going Concern
The Group’s consolidated financial statements have been prepared on a going concern basis which contemplates
the continuity of normal business activities and the realisation of assets and the settlement of liabilities in the
ordinary course of business. The Group’s cash flow forecast reflects that additional working capital will need to
be raised within the current financial year to enable the Group to continue its planned business activities and
expenditure levels.
At the date of this financial report, the directors are satisfied there are reasonable grounds to believe that,
having regard to the Group’s position and its available financing options, the Group will be able to raise
additional capital to enable it to meet its obligations as and when they fall due.
Should the Group not achieve the matters set out above, there would be uncertainty whether the Group would
continue as a going concern and therefore whether it would realise its assets and extinguish its liabilities in the
normal course of business and at the amounts stated in this financial report. This financial report does not
include any adjustment relating to the recoverability or classification of recorded asset amounts or to the
amounts or classification of liabilities that might be necessary should the Group not be able to continue as a
going concern.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
33
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
New Accounting Standards and Interpretations
The accounting policies adopted are consistent with those of the previous financial year except as follows:
From 1 July 2015, the Group has adopted all the Standards and Interpretations mandatory for annual periods
beginning on 1 July 2015. Adoption of these Standards and Interpretations did not have any effect on the
financial position or performance of the Group.
The Group has not elected to early adopt any new Standards or Interpretations.
The Group has adopted the following new and amended Australian Accounting Standards and AASB
Interpretations as of 1 July 2015:
Reference
Title
Summary
AASB 2013-9
Amendments to
Australian Accounting
Standards –
Conceptual
Framework,
Materiality and
Financial Instruments
The Standard contains three main parts and makes amendments to a number of Standards and
Interpretations.
Part A of AASB 2013-9 makes consequential amendments arising from the issuance of AASB CF
2013-1.
Part B makes amendments to particular Australian Accounting Standards to delete references to
AASB 1031 and also makes minor editorial amendments to various other standards.
Part C makes amendments to a number of Australian Accounting Standards, including
incorporating Chapter 6 Hedge Accounting into AASB 9 Financial Instruments.
The Standard completes the AASB’s project to remove Australian guidance on materiality from
Australian Accounting Standards.
AASB 2015-3
Amendments to
Australian Accounting
Standards arising from
the Withdrawal of
AASB 1031 Materiality
Australian Accounting Standards and interpretations which have recently been issued or amended but are not
yet effective have not been early-adopted by the Group for the annual reporting period ending 30 June 2016.
These standards and interpretations are tabulated below:
Application
date of
standard
1 Jan 2018
Application
date for
Group
1 Jul 2018
Impact on Group
Accounting
Policies
The Group has
yet to fully assess
the impact of
these
amendments on
the financial
statements.
Reference
Title
Summary
AASB 9
Financial
Instruments
AASB 9 (December 2014) is a new standard which replaces
AASB 139. This new version supersedes AASB 9 issued in
December 2009 (as amended) and AASB 9 (issued in
December 2010) and includes a model for classification
and measurement, a single, forward-looking ‘expected
loss’ impairment model and a substantially reformed
approach to hedge accounting.
AASB 9 is effective for annual periods beginning on or after
1 January 2018. However, the Standard is available for
early adoption. The own credit changes can be early
adopted in isolation without otherwise changing the
accounting for financial instruments.
Classification and measurement
AASB 9 includes requirements for a simpler approach for
classification and measurement of financial assets
compared with the requirements of AASB 139. There are
also some changes made in relation to financial liabilities.
The main changes are described below.
Financial assets
a. Financial assets that are debt instruments will be
classified based on (1) the objective of the entity's business
model for managing the financial assets; (2) the
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
34
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
Reference
Title
Summary
Application
date of
standard
Application
date for
Group
Impact on Group
Accounting
Policies
characteristics of the contractual cash flows.
b. Allows an irrevocable election on initial recognition to
present gains and losses on investments in equity
instruments that are not held for trading in other
comprehensive income. Dividends in respect of these
investments that are a return on investment can be
recognised in profit or loss and there is no impairment or
recycling on disposal of the instrument.
c. Financial assets can be designated and measured at fair
value through profit or loss at initial recognition if doing so
eliminates or significantly reduces a measurement or
recognition inconsistency that would arise from measuring
assets or liabilities, or recognising the gains and losses on
them, on different bases.
Financial liabilities
Changes introduced by AASB 9 in respect of financial
liabilities are limited to the measurement of liabilities
designated at fair value through profit or loss (FVPL) using
the fair value option.
Where the fair value option is used for financial liabilities,
the change in fair value is to be accounted for as follows:
► The change attributable to changes in credit risk are
presented in other comprehensive income (OCI)
► The remaining change is presented in profit or loss
AASB 9 also removes the volatility in profit or loss that was
caused by changes in the credit risk of liabilities elected to
be measured at fair value. This change in accounting
means that gains or losses attributable to changes in the
entity’s own credit risk would be recognised in OCI. These
amounts recognised in OCI are not recycled to profit or
loss if the liability is ever repurchased at a discount.
Impairment
The final version of AASB 9 introduces a new expected-loss
impairment model that will require more timely
recognition of expected credit losses. Specifically, the new
Standard requires entities to account for expected credit
losses from when financial instruments are first recognised
and to recognise full lifetime expected losses on a more
timely basis.
Hedge accounting
Amendments to AASB 9 (December 2009 & 2010 editions
and AASB 2013-9) issued in December 2013 included the
new hedge accounting requirements, including changes to
hedge effectiveness testing, treatment of hedging costs,
risk components that can be hedged and disclosures.
Consequential amendments were also made to other
standards as a result of AASB 9, introduced by AASB 2009-
11 and superseded by AASB 2010-7, AASB 2010-10 and
AASB 2014-1 – Part E.
AASB 2014-7 incorporates the consequential amendments
arising from the issuance of AASB 9 in Dec 2014.
AASB 2014-8 limits the application of the existing versions
of AASB 9 (AASB 9 (December 2009) and AASB 9
(December 2010)) from 1 February 2015 and applies to
annual reporting periods beginning on after 1 January
2015.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
35
Application
date of
standard
1 Jan 2016
Application
date for
Group
1 Jul 2016
Impact on Group
Accounting
Policies
The Group has
yet to fully assess
the impact of
these
amendments on
the financial
statements.
1 Jan 2016
1 Jul 2016
1 Jan 2018
1 Jul 2018
The amendments
to this standard
are not expected
to have a
significant impact
on the Group’s
financial results
or balance sheet
in the initial year
of application.
The Group has
yet to fully assess
the impact of
these
amendments on
the financial
statements.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
Reference
Title
Summary
AASB 2014-3
Amendments to
Australian
Accounting
Standards –
Accounting for
Acquisitions of
Interests in
Joint
Operations
[AASB 1 & AASB
11]
AASB 2014-4
Clarification of
Acceptable
Methods of
Depreciation
and
Amortisation
(Amendments
to AASB 116
and AASB 138)
AASB 15
Revenue from
Contracts with
Customers
AASB 2014-3 amends AASB 11 Joint Arrangements to
provide guidance on the accounting for acquisitions of
interests in joint operations in which the activity
constitutes a business. The amendments require:
(a) the acquirer of an interest in a joint operation in which
the activity constitutes a business, as defined in AASB 3
Business Combinations, to apply all of the principles on
business combinations accounting in AASB 3 and other
Australian Accounting Standards except for those
principles that conflict with the guidance in AASB 11; and
(b) the acquirer to disclose the information required by
AASB 3 and other Australian Accounting Standards for
business combinations.
This Standard also makes an editorial correction to AASB
11.
AASB 116 Property Plant and Equipment and AASB 138
Intangible Assets both establish the principle for the basis
of depreciation and amortisation as being the expected
pattern of consumption of the future economic benefits of
an asset.
The IASB has clarified that the use of revenue-based
methods to calculate the depreciation of an asset is not
appropriate because revenue generated by an activity that
includes the use of an asset generally reflects factors other
than the consumption of the economic benefits embodied
in the asset.
The amendment also clarified that revenue is generally
presumed to be an inappropriate basis for measuring the
consumption of the economic benefits embodied in an
intangible asset. This presumption, however, can be
rebutted in certain limited circumstances.
AASB 15 Revenue from Contracts with Customers replaces
the existing revenue recognition standards AASB 111
Construction Contracts, AASB 118 Revenue and related
Interpretations (Interpretation 13 Customer Loyalty
Programmes, Interpretation 15 Agreements for the
Construction of Real Estate, Interpretation 18 Transfers of
Assets from Customers, Interpretation 131 Revenue—
Barter Transactions Involving Advertising Services and
Interpretation 1042 Subscriber Acquisition Costs in the
Telecommunications Industry). AASB 15 incorporates the
requirements of IFRS 15 Revenue from Contracts with
Customers issued by the International Accounting
Standards Board (IASB) and developed jointly with the US
Financial Accounting Standards Board (FASB).
AASB 15 specifies the accounting treatment for revenue
arising from contracts with customers (except for contracts
within the scope of other accounting standards such as
leases or financial instruments).The core principle of AASB
15 is that an entity recognises revenue to depict the
transfer of promised goods or services to customers in an
amount that reflects the consideration to which the entity
expects to be entitled in exchange for those goods or
services. An entity recognises revenue in accordance with
that core principle by applying the following steps:
(a) Step 1: Identify the contract(s) with a customer
(b) Step 2: Identify the performance obligations in the
contract
(c) Step 3: Determine the transaction price
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
36
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
Reference
Title
Summary
Application
date of
standard
Application
date for
Group
Impact on Group
Accounting
Policies
(d) Step 4: Allocate the transaction price to the
performance obligations in the contract
(e) Step 5: Recognise revenue when (or as) the entity
satisfies a performance obligation.
AASB 2015-8 amended the AASB 15 effective date so it is
now effective for annual reporting periods commencing on
or after 1 January 2018. Early application is permitted.
AASB 2014-5 incorporates the consequential amendments
to a number Australian Accounting Standards (including
Interpretations) arising from the issuance of AASB 15.
AASB 2016-3 Amendments to Australian Accounting
Standards – Clarifications to AASB 15 amends AASB 15 to
clarify the requirements on identifying performance
obligations, principal versus agent considerations and the
timing of recognising revenue from granting a licence and
provides further practical expedients on transition to AASB
15.
This Standard lists the application paragraphs for each
Standard (and Interpretation), grouped where they are the
same. Accordingly, paragraphs 5 and 22 respectively
specify the application paragraphs for Standards and
Interpretations in general. Differing application
paragraphs are set out for individual Standards and
Interpretations or grouped where possible.
The application paragraphs do not affect requirements in
other Standards that specify that certain paragraphs apply
only to certain types of entities.
AASB 2014-9 amends AASB 127 Separate Financial
Statements, and consequentially amends AASB 1 First-time
Adoption of Australian Accounting Standards and AASB
128 Investments in Associates and Joint Ventures, to allow
entities to use the equity method of accounting for
investments in subsidiaries, joint ventures and associates
in their separate financial statements.
AASB 2014-9 also makes editorial corrections to AASB 127.
AASB 2014-9 applies to annual reporting periods beginning
on or after 1 January 2016. Early adoption permitted.
AASB 2014-10 amends AASB 10 Consolidated Financial
Statements and AASB 128 to address an inconsistency
between the requirements in AASB 10 and those in AASB
128 (August 2011), in dealing with the sale or contribution
of assets between an investor and its associate or joint
venture. The amendments require:
(a) a full gain or loss to be recognised when a transaction
involves a business (whether it is housed in a subsidiary or
not); and
(b) a partial gain or loss to be recognised when a
transaction involves assets that do not constitute a
business, even if these assets are housed in a subsidiary.
AASB 2014-10 also makes an editorial correction to AASB
10.
AASB 1057
Application of
Australian
Accounting
Standards
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
1 Jan 2016
1 Jul 2016
1 Jan 2016
1 Jul 2016
1 Jan 2018
1 Jul 2018
AASB 2015-1
AASB 2014-10 applies to annual reporting periods
beginning on or after 1 January 2018. Early adoption
permitted.
The subjects of the principal amendments to the Standards
are set out below:
AASB 5 Non-current Assets Held for Sale and Discontinued
Operations:
• Changes in methods of disposal – where an entity
Amendments to
Australian
Accounting
Standards –
Annual
Improvements
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
1 Jan 2016
1 Jul 2016
This standard is
not expected to
have a significant
impact on the
Group’s financial
results or balance
sheet in the initial
year of
application.
This standard is
not expected to
have a significant
impact on the
Group’s financial
results or balance
sheet in the initial
year of
application.
The amendments
to this standard
are not expected
to have a
significant impact
on the Group’s
financial results
or balance sheet
in the initial year
of application.
The amendments
to this standard
are not expected
to have a
significant impact
on the Group’s
37
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
Reference
Title
Summary
to Australian
Accounting
Standards
2012– 2014
Cycle
reclassifies an asset (or disposal group) directly from being
held for distribution to being held for sale (or visa versa),
an entity shall not follow the guidance in paragraphs 27–
29 to account for this change.
AASB 7 Financial Instruments: Disclosures:
Application
date of
standard
Application
date for
Group
Impact on Group
Accounting
Policies
financial results
or balance sheet
in the initial year
of application.
• Servicing contracts - clarifies how an entity should apply
the guidance in paragraph 42C of AASB 7 to a servicing
contract to decide whether a servicing contract is
‘continuing involvement’ for the purposes of applying the
disclosure requirements in paragraphs 42E–42H of AASB 7.
• Applicability of the amendments to AASB 7 to condensed
interim financial statements - clarify that the additional
disclosure required by the amendments to AASB 7
Disclosure–Offsetting Financial Assets and Financial
Liabilities is not specifically required for all interim periods.
However, the additional disclosure is required to be given
in condensed interim financial statements that are
prepared in accordance with AASB 134 Interim Financial
Reporting when its inclusion would be required by the
requirements of AASB 134.
AASB 119 Employee Benefits:
• Discount rate: regional market issue - clarifies that the
high quality corporate bonds used to estimate the discount
rate for post-employment benefit obligations should be
denominated in the same currency as the liability. Further
it clarifies that the depth of the market for high quality
corporate bonds should be assessed at the currency level.
AASB 134 Interim Financial Reporting:
• Disclosure of information ‘elsewhere in the interim
financial report’ - amends AASB 134 to clarify the meaning
of disclosure of information ‘elsewhere in the interim
financial report’ and to require the inclusion of a cross-
reference from
The Standard makes amendments to AASB 101
Presentation of Financial Statements arising from the
IASB’s Disclosure Initiative project. The amendments are
designed to further encourage companies to apply
professional judgment in determining what information to
disclose in the financial statements. For example, the
amendments make clear that materiality applies to the
whole of financial statements and that the inclusion of
immaterial information can inhibit the usefulness of
financial disclosures. The amendments also clarify that
companies should use professional judgment in
determining where and in what order information is
presented in the financial disclosures.
This Standard inserts scope paragraphs into AASB 8 and
AASB 133 in place of application paragraph text in AASB
1057. This is to correct inadvertent removal of these
paragraphs during editorial changes made in August 2015.
There is no change to the requirements or the applicability
of AASB 8 and AASB 133.
AASB 2015-2
AASB 2015-9
Amendments to
Australian
Accounting
Standards –
Disclosure
Initiative:
Amendments to
AASB 101
Amendments to
Australian
Accounting
Standards –
Scope and
Application
Paragraphs
[AASB 8, AASB
133 & AASB
1057]
1 Jan 2016
1 Jul 2016
1 Jan 2016
1 Jul 2016
The amendments
to this standard
are not expected
to have a
significant impact
on the Group’s
financial results
or balance sheet
in the initial year
of application.
The amendments
to this standard
are not expected
to have a
significant impact
on the Group’s
financial results
or balance sheet
in the initial year
of application.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
38
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
Reference
Title
Summary
AASB 16
Leases
The key features of AASB 16 are as follows:
Application
date of
standard
1 Jan 2019
Application
date for
Group
1 Jul 2019
Lessee accounting
(cid:120) Lessees are required to recognise assets and liabilities
for all leases with a term of more than 12 months,
unless the underlying asset is of low value.
(cid:120) A lessee measures right-of-use assets similarly to other
non-financial assets and lease liabilities similarly to
other financial liabilities.
(cid:120) Assets and liabilities arising from a lease are initially
measured on a present value basis. The measurement
includes non-cancellable lease payments (including
inflation-linked payments), and also includes payments
to be made in optional periods if the lessee is
reasonably certain to exercise an option to extend the
lease, or not to exercise an option to terminate the
lease.
(cid:120) AASB 16 contains disclosure requirements for lessees.
Lessor accounting
(cid:120) AASB 16 substantially carries forward the lessor
accounting requirements in AASB 117. Accordingly, a
lessor continues to classify its leases as operating leases
or finance leases, and to account for those two types of
leases differently.
(cid:120) AASB 16 also requires enhanced disclosures to be
provided by lessors that will improve information
disclosed about a lessor’s risk exposure, particularly to
residual value risk.
AASB 16 supersedes:
(a) AASB 117 Leases
(b) Interpretation 4 Determining whether an Arrangement
contains a Lease
(c) SIC-15 Operating Leases—Incentives
(d) SIC-27 Evaluating the Substance of Transactions
Involving the Legal Form of a Lease
The new standard will be effective for annual periods
beginning on or after 1 January 2019. Early application is
permitted, provided the new revenue standard, AASB 15
Revenue from Contracts with Customers, has been
applied, or is applied at the same date as AASB 16.
This Standard amends AASB 112 Income Taxes (July 2004)
and AASB 112 Income Taxes (August 2015) to clarify the
requirements on recognition of deferred tax assets for
unrealised losses on debt instruments measured at fair
value.
1 Jan 2017
1 Jul 2017
This Standard amends AASB 107 Statement of Cash Flows
(August 2015) to require entities preparing financial
statements in accordance with Tier 1 reporting
requirements to provide disclosures that enable users of
financial statements to evaluate changes in liabilities
arising from financing activities, including both changes
arising from cash flows and non-cash changes.
1 Jan 2017
1 Jul 2017
2016-1
2016-2
Amendments to
Australian
Accounting
Standards –
Recognition of
Deferred Tax
Assets for
Unrealised
Losses
[AASB 112]
Amendments to
Australian
Accounting
Standards –
Disclosure
Initiative:
Amendments to
AASB 107
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
Impact on Group
Accounting
Policies
The Group has
yet to fully assess
the impact of
these
amendments on
the financial
statements.
The amendments
to this standard
are not expected
to have a
significant impact
on the Group’s
financial results
or balance sheet
in the initial year
of application.
The amendments
to this standard
are not expected
to have a
significant impact
on the Group’s
financial results
or balance sheet
in the initial year
of application.
39
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
Reference
Title
Summary
IFRS 2
(Amendments)
Classification
and
Measurement
of
Share-based
Payment
Transactions
[Amendments
to IFRS 2]
This standard amends to IFRS 2 Share-based Payment,
clarifying how to account for certain types of share-based
payment transactions. The amendments provide
requirements on the accounting for:
(cid:120) The effects of vesting and non-vesting conditions on the
measurement of cash-settled share-based payments
(cid:120) Share-based payment transactions with a net
settlement feature for withholding tax obligations
(cid:120) A modification to the terms and conditions of a share-
based payment that changes the classification of the
transaction from cash-settled to equity-settled.
Accounting Policies
a)
Basis of Consolidation
Application
date of
standard
1 Jan 2018
Application
date for
Group
1 Jul 2018
Impact on Group
Accounting
Policies
The amendments
to this standard
are not expected
to have a
significant impact
on the Group’s
financial results
or balance sheet
in the initial year
of application.
The consolidated financial statements comprise the financial statements of the Group and its subsidiaries as at
30 June 2016. Control is achieved when the Group is exposed, or has rights, to variable returns from its
involvement with the investee and has the ability to affect those returns through its power over the investee.
Specifically, the Group controls an investee if and only if the Group has:
(cid:120) Power over the investee (i.e. existing rights that give it the current ability to direct the relevant activities of
the investee);
(cid:120) Exposure, or rights, to variable returns from its involvement with the investee, and
(cid:120) The ability to use its power over the investee to affect its returns.
When the Group has less than a majority of the voting or similar rights of an investee, the Group considers all
relevant facts and circumstances in assessing whether it has power over an investee, including:
(cid:120) The contractual arrangement with the other vote holders of the investee
(cid:120) Rights arising from other contractual arrangements
(cid:120) The Group’s voting rights and potential voting rights
The Group re-assesses whether or not it controls an investee if facts and circumstances indicate that there are
changes to one or more of the three elements of control. Consolidation of a subsidiary begins when the Group
obtains control over the subsidiary and ceases when the Group loses control of the subsidiary. Assets, liabilities,
income and expenses of a subsidiary acquired or disposed of during the year are included in the statement of
comprehensive income from the date the Group gains control until the date the Group ceases to control the
subsidiary.
Profit or loss and each component of other comprehensive income are attributed to the equity holders of the
parent of the Group 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 intra-group assets and liabilities,
equity, income, expenses and cash flows relating to transactions between members of the Group are eliminated
in full on consolidation.
A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an equity
transaction. If the Group loses control over a subsidiary, it:
(cid:120) De-recognises the assets (including goodwill) and liabilities of the subsidiary
(cid:120) De-recognises the carrying amount of any non-controlling interests
(cid:120) De-recognises the cumulative translation differences recorded in equity
(cid:120) Recognises the fair value of the consideration received
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
40
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
(cid:120) Recognises the fair value of any investment retained
(cid:120) Recognises any surplus or deficit in profit or loss
(cid:120) Reclassifies the parent’s share of components previously recognised in OCI to profit or loss or retained
earnings, as appropriate, as would be required if the Group had directly disposed of the related assets or
liabilities.
b)
Income and Other Taxes
Income taxes
Current tax assets and liabilities for the current and prior periods are measured at the amount expected to be
recovered from or paid to the taxation authorities based on the current period’s taxable income. The tax rates
and tax laws used to compute the amount are those that are enacted or substantively enacted by the reporting
date.
Deferred income tax is provided on all temporary differences at the reporting date between the tax bases of
assets and liabilities and their carrying amounts for financial reporting purposes.
Deferred income tax liabilities are recognised for all taxable temporary differences except:
(cid:120) when the deferred income tax liability arises from the initial recognition of an asset or liability in a transaction
that is not a business combination and, at the time of the transaction, affects neither the accounting profit
nor taxable profit or loss; and
(cid:120) when the taxable temporary difference is associated with investments in subsidiaries, associates or interests
in joint ventures, and the timing of the reversal of the temporary difference can be controlled and it is
probable that the temporary difference will not reverse in the foreseeable future.
Deferred income tax assets are recognised for all deductible temporary differences, carry-forward of unused tax
assets and unused tax losses, to the extent that it is probable that taxable profit will be available, against which
the deductible temporary differences, the carry-forward of unused tax assets and unused tax losses can be
utilised, except:
(cid:120) when the deferred income tax asset relating to the deductible temporary difference arises from the initial
recognition of an asset or liability in a transaction that is not a business combination and, at the time of the
transaction, affects neither the accounting profit nor taxable profit or loss; and
(cid:120) when the deductible temporary difference is associated with investments in subsidiaries, associates or
interests in joint ventures, in which case a deferred tax asset is recognised only to the extent that it is
probable that the temporary differences will reverse in the foreseeable future and taxable profit will be
available against which the temporary difference can be utilised.
The carrying amount of deferred income tax assets is reviewed at each reporting date and reduced to the extent
that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred
income tax asset to be utilised.
Unrecognised deferred income tax assets are reassessed at each reporting date and are recognised to the extent
that it has become probable that future taxable profit will allow the deferred tax asset to be recovered.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year
when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or
substantively enacted at the reporting date.
Deferred tax assets and deferred tax liabilities are offset only if a legally enforceable right exists to set off current
tax assets against current tax liabilities and the deferred tax assets and liabilities relate to the same taxable entity
and the same taxation authority.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
41
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
Other taxes
Revenues, expenses and assets are recognised net of the amount of GST/VAT except:
(cid:120) when the GST/VAT incurred on a purchase of goods and services is not recoverable from the taxation
authority, in which case the GST/VAT is recognised as part of the cost of acquisition of the asset or as part of
the expenses item as applicable; and
receivables and payables, which are stated with the amount of GST/VAT included.
(cid:120)
The net amount of GST/VAT recoverable from, or payable to, the relevant taxation authority is included as part
of receivables or payables in the statement of financial position.
Cash flows are included in the Cash Flow Statement on a gross basis and the GST/VAT component of cash flows
arising from investing and financing activities which is recoverable from, or payable to, the relevant taxation
authority is classified as part of operating cash flows.
Commitments and contingencies are disclosed net of the amount of GST/VAT recoverable from, or payable to,
the relevant taxation authority.
c)
Exploration and Evaluation Expenditure
Exploration and evaluation expenditure is accumulated in respect of each identifiable area of interest. These
costs are carried forward only if they relate to an area of interest for which rights of tenure are current and in
respect of which:
(i)
(ii)
such costs are expected to be recouped through successful development, exploitation or sale of the
area; or
exploration and evaluation activities in the area have not, at balance date, reached a stage which permit
a reasonable assessment of the existence or otherwise of economically recoverable reserves, and active
operations in, or relating to, the area are continuing.
Accumulated costs in respect of areas of interest which are abandoned or assessed as not having economically
recoverable reserves are written off in full against profit in the year in which the decision to abandon the area is
made.
A periodic 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.
d)
Property, Plant and Equipment
Plant and equipment are measured at historical cost less accumulated depreciation and any accumulated
impairment costs.
The carrying amount of plant and equipment is reviewed annually to ensure it is not in excess of the recoverable
amount from these assets. External factors, such as changes in expected future processes, technology and
economic conditions, are also monitored to assess for indicators of impairment. If any indication of impairment
exists, an estimate of the asset’s recoverable amount is calculated.
Land and buildings are measured at fair value less accumulated depreciation on buildings and impairment losses
recognised at the date of revaluation. Valuations are performed with sufficient frequency to ensure that the fair
value of a revalued asset does not differ materially from its carrying amount.
A revaluation surplus is recorded in other comprehensive income and credited to the asset revaluation reserve in
equity. However, to the extent that it reverses a revaluation deficit of the same asset previously recognised in
profit or loss, the increase is recognised in profit and loss. A revaluation deficit is recognised in the income
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
42
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
statement, except to the extent that it offsets an existing surplus on the same asset recognised in the asset
revaluation reserve.
Depreciation
The depreciable amount of all fixed assets is depreciated on a diminishing value basis over the useful lives to the
Group commencing from the time the asset is held ready for use. The depreciation rates used for each class of
depreciable assets are:
Class of Fixed Asset
Buildings
Plant and equipment
Office Furniture & Equipment
Vehicles
Depreciation Rate
2016
2.0%
33.3%
33.3%
33.3%
2015
2.0%
33.3%
33.3%
33.3%
An asset’s residual value, useful life and amortisation method are reviewed, and adjusted if appropriate, at each
financial year end.
Gains or losses on disposals are determined by comparing proceeds with the net carrying amount. These are
included in the statement of comprehensive income.
e)
Fair value measurement
The Group measures non-financial assets such as land and buildings at fair value less accumulated depreciation
on buildings at each balance sheet date.
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. The fair value measurement is based on the
presumption that the transaction to sell the asset or transfer the liability takes place either:
(cid:120)
(cid:120)
In the principal market for the asset or liability, or
In the absence of a principal market, in the most advantageous market for the asset or liability
The principal or the most advantageous market must be accessible to by the Group. The fair value of an asset or
a liability is measured using the assumptions that market participants would use when pricing the asset or
liability, assuming that market participants act in their economic best interest.
A fair value measurement of a non-financial asset takes into account a market participant's ability to generate
economic benefits by using the asset in its highest and best use or by selling it to another market participant that
would use the asset in its highest and best use.
The Group uses valuation techniques that are appropriate in the circumstances and for which sufficient data are
available to measure fair value, maximising the use of relevant observable inputs and minimising the use of
unobservable inputs.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised
within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair
value measurement as a whole:
(cid:120) Level 1 Quoted (unadjusted) market prices in active markets for identical assets or liabilities
(cid:120) Level 2
Valuation techniques for which the lowest level input that is significant to the fair value
measurement is directly or indirectly observable
Valuation techniques for which the lowest level input that is significant to the fair value
measurement is unobservable
(cid:120) Level 3
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
43
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
For assets and liabilities that are recognised in the financial statements on a recurring basis, the Group
determines whether transfers have occurred between Levels in the hierarchy by re-assessing categorisation
(based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each
reporting period.
External valuers are involved for valuation of significant assets, such as properties. Involvement of external
valuers is decided upon annually by management. Selection criteria include market knowledge, reputation,
independence and whether professional standards are maintained. Valuers are normally rotated every three
years. The valuation committee decides, after discussions with the Group’s external valuers, which valuation
techniques and inputs to use for each case.
At each reporting date, management analyses the movements in the values of assets and liabilities which are
required to be re-measured or re-assessed as per the Group’s accounting policies. For this analysis, management
verifies the major inputs applied in the latest valuation by agreeing the information in the valuation computation
to contracts and other relevant documents.
Management, in conjunction with the Group’s external valuers, also compares each the changes in the fair value
of each asset and liability with relevant external sources to determine whether the change is reasonable.
On an interim basis, Management and the Group’s external valuers present the valuation results to the audit
committee and the Group’s independent auditors. This includes a discussion of the major assumptions used in
the valuations.
For the purpose of fair value disclosures, the Group has determined classes of assets and liabilities on the basis of
the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy as explained
above.
f)
Leases
Leases of fixed assets where substantially all the risks and benefits incidental to the ownership of the asset, but
not the legal ownership are transferred to the lessee, are classified as finance leases. Finance leases are
capitalised, recording an asset and a liability equal to the present value of the minimum lease payments,
including any guaranteed residual values. Lease payments are apportioned between the finance charges and
reduction of the lease liability so as to achieve a constant rate of interest on the remaining balance of the
liability. Finance charges are recognised as an expense in the statement of comprehensive income.
Leased assets are depreciated on a diminishing value basis over their estimated useful lives where it is likely that
the Group will obtain ownership of the asset or over the term of the lease.
Lease payments for operating leases, where substantially all the risks and benefits remain with the lessor, are
charged as expenses in the periods in which they are incurred.
g)
Basic Earnings/Loss Per Share
Basic earnings/loss per share is calculated by dividing the net profit / loss attributable to members of the parent
for the reporting period, after excluding any costs of servicing equity, by the weighted average number of
ordinary shares of the Group, adjusted for any bonus issue.
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into
account the after income tax effect of interest and other financing costs associated with dilutive potential
ordinary shares and the weighted average number of shares assumed to have been issued for no consideration
in relation to dilutive potential ordinary shares.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
44
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
h)
Revenue
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the
revenue can be reliably measured. The following specific recognition criteria must also be met before revenue is
recognised:
Interest
Revenue is recognised as the interest accrues (using the effective interest method, which is the rate that exactly
discounts estimated future cash receipts through the expected life of the financial instrument) to the net
carrying amount of the financial asset.
i)
Cash and Cash Equivalents
Cash and cash equivalents in the statement of financial position comprise cash at bank and on hand, cash on call
and short-term deposits with an original maturity of three months or less that are readily convertible to known
amounts of cash and which are subject to an insignificant risk of changes in value. For the purposes of the Cash
Flow Statement, cash and cash equivalents consist of cash and cash equivalents as described, net of outstanding
bank overdrafts.
j)
Impairment of Assets
At each reporting date, the Group assesses whether there is any indication that an asset may be impaired.
Where an indication of impairment exists, the Group makes a formal estimate of recoverable amount. Where the
carrying amount of an asset exceeds its recoverable amount, the asset is considered impaired and is written
down to its recoverable amount.
Recoverable amount is the greater of fair value (less costs to sell) and value-in-use. It is determined for an
individual asset, unless the asset’s value-in-use cannot be estimated to be close to its fair value (less costs to sell)
and it does not generate cash inflows that are largely independent of those from other assets or groups of assets,
in which case, the recoverable amount is determined for the cash-generating unit to which the asset belongs.
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.
k)
Payables
Trade and other payables are carried at amortised cost. Due to their short term nature they are not discounted.
They represent liabilities for goods and services provided to the Group prior to the end of the financial year that
are unpaid and arise when the Group becomes obliged to make future payments in the respect of the purchase
of these goods and services. The amounts are unsecured and usually paid within 30 days of recognition.
l)
Interest Bearing Loans and Borrowings
The component of the convertible notes which exhibits characteristics of a borrowing is recognised as a liability
in the statement of financial position, net of transaction costs. On the issue of convertible notes, the fair value of
the liability component is determined using a market rate for an equivalent non-convertible note and this
amount is carried as a long-term liability on an amortised cost basis until extinguished on conversion or
redemption. The increase in the liability due to the passage of time is recognised as a finance cost. The
remainder of the proceeds of the convertible note is the equity component, which is allocated to a convertible
note reserve that is recognised and included in shareholders’ equity. The carrying amount of the reserve is not
re-measured in subsequent years.
All loans and borrowings are initially recognised at the fair value of the consideration received less directly
attributable transaction costs.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
45
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
After initial recognition, interest bearing loans and borrowings are subsequently measured at amortised cost
using the effective interest method. Fees paid on the establishment of loan facilities that are yield related are
included as part of the carrying amount of the loans and borrowings.
Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of
the liability for at least 12 months after the reporting date.
Borrowing Costs
Borrowing costs are recognised as an expense when incurred. The Group does not currently hold any qualifying
assets but, if it did, the directly associated borrowing costs would be capitalised (including any other associated
costs attributable to the borrowing and temporary investment income earned on the borrowing).
m) Provisions
General
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past
event, it is probable that an outlay of resources embodying economic benefits will be required to settle the
obligation and a reliable estimate can be made of the amount of the obligation.
Where the Group expects some or all of a provision to be reimbursed, for example under an insurance contract,
the reimbursement is recognised as a separate asset but only when a reimbursement is virtually certain. The
expense relating to any provision is presented in the statement of comprehensive income net of any
reimbursement.
Provisions are measured at the present value of management’s best estimate of the expenditure required to
settle the present obligation at the reporting date using a discounted cash flow methodology. If the effect of the
time value of money is material, provisions are discounted using a current pre-tax rate that reflects the time
value of money and the risks specific to the liability. Any increase in the provision due to the passage of time is
recognised as a finance cost.
Rehabilitation Provision
Rehabilitation costs will be incurred by the Group either while operating, or at the end of the operating life of,
the Group’s facilities. The Group assesses its rehabilitation provision at each reporting date. The Group
recognises a rehabilitation provision where it has a legal and constructive obligation as a result of past events,
and it is probable that an outflow of resources will be required to settle the obligation, and a reliable estimate of
the amount of obligation can be made. The nature of these restoration activities includes: dismantling and
removing structures; dismantling operating facilities; closing plant and waste sites; and restoring, reclaiming and
revegetating affected areas.
The obligation generally arises when the asset is installed or the ground/environment is disturbed at the
operation’s location. When the liability is initially recognised, the present value of the estimated costs is
capitalised by increasing the carrying amount of the related assets to the extent that it was incurred. Additional
disturbances which arise due to further development/construction at the mine are recognised as additions or
charges to the corresponding assets and rehabilitation liability when they occur.
Changes in the estimated timing of rehabilitation or changes to the estimated future costs are dealt with
prospectively by recognising an adjustment to the rehabilitation liability and a corresponding adjustment to the
asset to which it relates, if the initial estimate was originally recognised as part of an asset measured in
accordance with AASB 6.
Any reduction in the rehabilitation liability and, therefore, any deduction from the asset to which it relates, may
not exceed the carrying amount of that asset. If it does, any excess over the carrying value is taken immediately
to the statement of profit or loss and other comprehensive income.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
46
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
If the change in estimate results in an increase in the rehabilitation liability and, therefore, an addition to the
carrying value of the asset, the Group considers whether this is an indication of impairment of the asset as a
whole, and if so, tests for impairment. If, for mature mines, the estimate for the revised mine assets net of
rehabilitation provisions exceeds the recoverable value, that portion of the increase is charged directly to
expense.
Over time, the discounted liability is increased for the change in present value based on the discount rates that
reflect current market assessments and the risks specific to the liability.
n)
Employee Benefits
Provision is made for the Group’s liability for employee benefits arising from services rendered by employees to
balance date.
Contributions are made by the Group to employee superannuation and pension funds and are charged as
expenses when incurred.
Liabilities for wages and salaries, including non-monetary benefits and annual leave expected to be settled within
12 months of the reporting date are recognised in respect of employees’ services up to the reporting date. They
are measured at the amounts expected to be paid when the liabilities are settled.
o)
Contributed Equity
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or
share options are shown in equity as a deduction, net of tax, from the proceeds.
p)
Share-based Payment Transactions
The Group provides benefits to employees and directors of the Group, acquires assets and settles expenses
through consideration in the form of share-based payment transactions, whereby employees render services,
assets are acquired and expenses are settled in exchange for shares or rights over shares (“equity-settled
transactions”).
There is currently a Non-Executive Director Share Option Plan and an Employee Incentive Plan which enables the
provision of benefits to directors, executives and staff.
The cost of these equity-settled transactions with employees and directors is measured by reference to the fair
value at the date at which they are granted. The fair value is determined using the Black Scholes option pricing
model. A Monte Carlo simulation is applied to fair value the Total Shareholder Return element of the EIP
incentives. Further details of which are disclosed in Note 21.
In valuing equity-settled transactions, no account is taken of any vesting condition, other than (if applicable):
(cid:120) Non-vesting conditions that do not determine whether the Group or Company receives the services that
(cid:120)
entitle the employees to receive payment in equity or cash; or
Conditions that are linked to the price of the shares of Bannerman Resources Limited (market
conditions).
The cost of equity settled transactions is recognised, together with a corresponding increase in equity, over the
period in which the performance and/or service conditions are fulfilled (the vesting period), ending on the date
on which the relevant employees become fully entitled to the award (the vesting date).
At each subsequent report date until vesting, the cumulative charge to the statement of comprehensive income
is the product of:
(i) The grant date fair value of the award;
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
47
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
(ii) The current best estimate of the number of the awards that will vest, taking into account such factors as the
likelihood of employee turnover during the vesting period and the likelihood of non-market performance
conditions being met; and
(iii) The expired portion of the vesting period.
The charge to the statement of comprehensive income for the period is the cumulative amount as calculated
above, less the amounts already charged in previous periods. There is a corresponding entry to equity.
Equity-settled awards granted by Bannerman to employees of subsidiaries are recognised in the parent’s
separate financial statements as an additional investment in the subsidiary with the corresponding credit to
equity. As a result, the expense recognised by Bannerman in relation to equity-settled awards only represents
the expenses associated with grants to employees of the parent. The expense recognised by the Group is the
total expense associated with all such awards.
Until an award has vested, any amounts recorded are contingent and will be adjusted if more or fewer awards
vest than were originally anticipated to do so. Any award subject to a market conditions or non-vesting
conditions is considered to vest irrespective of whether or not that market condition or non-vesting is fulfilled,
provided that all other conditions are satisfied.
q)
Foreign Currency Translation
(i) Functional and presentation currency
Items included in the financial statements of each of the Group’s entities are measured using the currency of the
primary economic environment in which the entity operates (“functional currency”). The consolidated financial
statements are presented in Australian dollars, which is Bannerman’s functional and presentation currency.
(ii) Transactions and balances
Transactions in foreign currencies are initially recorded in the functional currency by applying the exchange rates
ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are
retranslated at the rate of exchange ruling at the reporting date and any gains or losses are recognised in the
statement of comprehensive income.
(iii) Group companies
For all Group entities with a functional currency other than Australian dollars, the functional currency has been
translated into Australian dollars for presentation purposes. Assets and liabilities are translated using exchange
rates prevailing at the reporting date; revenues and expenses are translated using average exchange rates
prevailing for the statement of comprehensive income year; and equity transactions are translated at exchange
rates prevailing at the dates of transactions. The resulting difference from translation is recognised in a foreign
currency translation reserve.
(iv) Subsidiary company loans
All subsidiary company loans from the parent company are translated into Australian dollars, on a monthly basis,
using the exchange rates prevailing at the end of each month. The resulting difference from translation is
recognised in the statement of comprehensive income of the parent company and on consolidation the foreign
exchange differences are recognised in a foreign currency translation reserve as the loan represents a net
investment in a foreign entity.
r)
Receivables
Receivables, which generally have 30-60 day terms, are recognised initially at fair value and subsequently
measured at amortised cost using the effective interest method, less an allowance for impairment. VAT
receivables relating to Namibian expenditure generally have a 90+ day term.
Collectability of receivables is reviewed on an on-going basis. Individual debts that are known to be uncollectible
are written off when identified. An impairment allowance is recognised when there is objective evidence that the
Group will not be able to collect the receivable. Financial difficulties of the debtor, and default payments or
debts more than 90 days overdue (apart from GST/VAT), are considered objective evidence of impairment. The
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
48
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
amount of the impairment loss is the receivable carrying amount compared to the present value of estimated
future cash flows, discounted at the original effective interest rate.
s)
Segment Reporting
An operating segment is a component of an entity that engages in business activities from which it may earn
revenues and incur expenses (including revenues and expenses relating to transactions with other components
of the same entity), whose operation results are regularly reviewed by the entity's chief operating decision
maker to make decisions about resources to be allocated to the segment and assess its performance and for
which discrete financial information is available. This includes start-up operations which are yet to earn
revenues. Management will also consider other factors in determining operating segments such as the existence
of a line manager and the level of segment information presented to the board of directors.
Operating segments have been identified based on the information provided to the chief operating decision
makers being the executive management team.
The operations of the Group represent one operating segment under AASB 8 Operating Segments. The
accounting policies applied for internal reporting purposes are consistent with those applied in the preparation
of the financial report.
t)
Financial Risk Management Objectives and Policies
The Group’s principal financial instruments comprise cash, receivables, payables, convertible instruments,
finance leases, cash and short term deposits.
The Group manages its exposure to key financial risks, including interest rate and currency risk in accordance
with the Group’s financial risk management strategy. The objective of the strategy is to support the delivery of
the Group’s financial targets whilst protecting future financial security.
u)
Significant Accounting Judgements, Estimates and Assumptions
The preparation of the financial statements requires management to make judgements, estimates and
assumptions that affect the reported amounts in the financial statements. Management continually evaluates its
judgements and estimates in relation to assets, liabilities, contingent liabilities, revenues and expenses.
Management bases its judgements and estimates on historical experience and on other various factors believed
to be reasonable under the circumstances, the results of which form the basis of the carrying values of assets
and liabilities that are not readily apparent from other sources.
Management has identified the critical accounting policies detailed below for which significant judgements,
estimates and assumptions are made. Actual results may differ from these estimates under different
assumptions and conditions and may materially affect financial results or the financial position reported in future
periods. Further details of the nature of these assumptions and conditions may be found in the relevant notes to
the financial statements. The carrying amounts of certain assets and liabilities are often determined based on
judgements, estimates and assumptions of future events. The key estimates and assumptions that have a
significant risk of causing a material adjustment to the carrying amounts of certain assets and liabilities within
the next annual reporting period are:
Impairment of capitalised exploration and evaluation expenditure
The future recoverability of capitalised exploration and evaluation expenditure is dependent on a number of
factors, including whether the Group decides to exploit the related mineral title itself or, if not, whether it
successfully recovers the related exploration and evaluation asset through sale.
Factors which could impact the future recoverability include the level of measured, indicated and inferred
mineral resources, proven and probable ore reserves, future technological changes which could impact the cost
of mining, future legal changes (including changes to environmental restoration obligations), changes to
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
49
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
commodity prices, ability to finance, renewal of the exclusive prospecting licence and the issue of a mining
licence.
To the extent that capitalised exploration and evaluation expenditure is determined not to be recoverable in the
future, this will reduce profits and net assets in the period in which this determination is made.
Share-based payment transactions
The Group measures the cost of equity-settled transactions with employees by reference to the fair value of the
equity instruments at the date at which they are granted and taking into consideration the likelihood of non-
market based conditions occurring. Estimating fair value for share-based payment transactions requires
determining the most appropriate valuation model, which is dependent on the terms and conditions of the
grant. This estimate also requires determining the most appropriate inputs to the valuation model including the
expected life of the share option, volatility and dividend yield and making assumptions about them. The
assumptions and models used for estimating fair value for share-based payment transactions are disclosed in
Note 21.
Rehabilitation provision
The ultimate rehabilitation costs are uncertain, and cost estimates can vary in response to many factors,
including estimates of the extent and costs of rehabilitation activities, technological changes, regulatory changes,
cost increases as compared to the inflation rates, and changes in discount rates. These uncertainties may result
in future actual expenditure differing from the amounts currently provided. Therefore, significant estimates and
assumptions are made in determining the provision for rehabilitation. As a result, there could be significant
adjustments to the provisions established which would affect future financial result. The provision at reporting
date represents management’s best estimate of the present value of the future rehabilitation costs required.
Revaluation of land and buildings
The Group applies the revaluation model to land and buildings and recognises any changes in fair value in the
asset revaluation reserve in equity. The Group engaged an independent valuation specialist to assess fair value
as at 30 June 2016. Land and buildings were revalued by reference to market-based evidence, using comparable
prices adjusted for specific market factors such as nature, location and condition of the property
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
50
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
Consolidated
2016
$'000
2015
$'000
2. INTEREST REVENUE
Interest revenue
3. OTHER INCOME
Profit on disposal of plant and equipment
Other
Gain on extinguishment of convertible note (refer note 12)
4. EXPENSES
(a) Employee Benefits
Salaries and wages
Superannuation
Employee share-based payment expense
Other
Directors’ fees
Directors’ share-based payment expense
(b) Borrowing Costs
Interest accreted or payable
(c) Other Expenses
Corporate and overheads
Consulting – fees
Legal
Travel
Employer related taxes
Recruitment
Occupancy
Insurance
Loss on disposal of plant and equipment
Included in the above expenses are operating lease payments of
the following amounts:
Minimum lease payments
30
30
-
12
4,414
4,426
734
68
428
7
189
112
1,538
1,227
1,227
271
982
82
113
13
-
99
52
8
1,620
53
75
75
14
-
-
14
744
55
410
12
210
125
1,556
2,104
2,104
288
114
76
116
74
26
102
50
-
846
57
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
51
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
5. AUDITOR'S REMUNERATION
The auditor of the Group is Ernst & Young.
Amounts received or due and receivable by Ernst & Young (Australia) for:
Auditing or reviewing the financial report
Audit related
Taxation services (i)
Consolidated
2016
2015
$
$
50,929
-
150,500
201,429
(i) Taxation services relating to tax structuring advice.
Amounts received or due and receivable by related practices of Ernst & Young (Australia) for:
48,000
4,120
9,000
61,120
14,800
1,725
16,525
14,063
1,286
15,349
$’000
$’000
(145)
-
(145)
-
(297)
(89)
2,151
(30)
(145)
(2,032)
(145)
(500)
-
(500)
-
(4,741)
(1,422)
880
(36)
(500)
578
(500)
Auditing or reviewing the financial report
Taxation services
6. INCOME TAX BENEFIT
The components of income tax benefit comprise:
Current income tax benefit
Deferred income tax benefit
Income tax benefit reported in the consolidated statement
of comprehensive income
Income tax expense recognised in equity
Accounting loss before tax
At the parent company statutory income tax rate of 30 %
Other non-deductible expenditure for income tax purposes
Effect of different tax rate for overseas subsidiary
Prior year adjustment – current tax on R&D tax offset
(Recognised) / Unrecognised tax losses
Income tax benefit reported in the consolidated statement of
comprehensive income
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
52
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
Carried forward revenue losses
Share issue costs
Provisions and accruals
Other
Gross deferred tax asset
Offset against deferred tax liability
Unrecognised deferred tax assets
Deferred tax liabilities
Exploration expenditure
Convertible Note
Other
Gross deferred tax liability
Offset against deferred tax asset
Net deferred tax liability
Consolidated
2016
$’000
2015
$’000
12,020
26
155
-
12,201
(6)
12,195
-
-
6
6
(6)
-
14,013
69
202
-
14,284
(521)
13,763
-
516
5
521
(521)
-
The carried forward tax losses for Bannerman Resources Limited at 30 June 2016 are $36,476,972. The carried
forward tax losses for Bannerman Namibia Pty Ltd at 30 June 2016 are $2,870,696. These tax losses do not expire
and may not be used to offset taxable income elsewhere in the Group. The Group neither has any taxable
temporary differences nor any tax planning opportunities available that could partly support the recognition of
these losses as deferred tax assets. On this basis, the Group has determined that it cannot recognise deferred tax
assets on the tax losses carried forward.
The Group has not elected to form a tax consolidated group.
7. CASH AND CASH EQUIVALENTS
Cash on hand
Cash at bank and on call (interest bearing)
Short-term deposits (interest bearing)
1
1,579
20
1,600
3
1,441
847
2,291
The effective interest rate on short-term bank deposits was 1.90% (2015: 2.72%). These deposits have an
average maturity of 90 days (2015: 90 days).
8. OTHER RECEIVABLES
Current
GST/VAT
Other
Non-Current
Restricted cash
27
-
27
15
15
165
1
166
15
15
Restricted cash reflects collateral for a third party bank guarantee for the occupancy of office premises.
Fair value and credit risk
Due to the short term nature of current receivables, their carrying value is assumed to approximate their fair
value.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
53
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
The maximum exposure to credit risk is the fair value of the receivables. Collateral is not held as security, nor is it
the Group’s policy to transfer (on-sell) receivables to special purpose entities.
As at 30 June 2016, the ageing analysis of trade receivables is as follows:
Total
$'000
27
166
2016
2015
Neither past due nor
impaired
$'000
27
166
Past due but not impaired
61-90 days
$'000
91-120 days
$'000
>120 days
$'000
-
-
-
-
-
-
Foreign exchange and interest rate risk
Detail regarding foreign exchange and interest rate risk exposure is disclosed in Note 16(a) and (b).
9. PROPERTY, PLANT AND EQUIPMENT
30 June 2016
Opening net book value
Additions
Disposals
Exchange difference
Depreciation charge
Closing net book value
At 30 June 2016
Cost or fair value
Accumulated depreciation
and impairment
Net book value
30 June 2015
Opening net book value
Additions
Disposals
Exchange difference
Depreciation charge
Closing net book value
At 30 June 2015
Cost or fair value
Accumulated depreciation
and impairment
Net book value
Office
Equipment
$'000
Lab & Field
Equipment
Sundry
Vehicles
$'000
$'000
$'000
Land &
Buildings (i)
$'000
Total
$'000
71
23
(7)
(7)
(16)
64
303
(239)
64
82
19
(4)
2
(28)
71
387
(316)
71
20
-
-
(3)
(1)
16
74
3
(2)
(3)
(22)
50
47
-
-
(6)
(7)
34
123
446
184
(107)
16
(396)
50
(150)
34
26
-
-
2
(8)
20
106
1
-
1
(34)
74
34
27
(7)
2
(9)
47
136
466
215
(116)
20
(392)
74
(168)
47
660
-
-
(95)
(7)
558
572
(14)
558
632
-
-
37
(9)
660
669
(9)
660
872
26
(9)
(114)
(53)
722
1,628
(906)
722
880
47
(11)
44
(88)
872
1,873
(1,001)
872
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
54
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
(i)
Revaluation of land and buildings
The revalued land and buildings consist of the office property in Swakopmund, Namibia. Management determined that
these constitute one class of asset under AASB 13, based on the nature, characteristics and risks of the property.
Fair value of the property was determined by using market comparable method. This means that valuations performed
by the valuer are based on active market prices, significantly adjusted for difference in the nature, location or condition
of the specific property. As at the date of revaluation, 31 May 2016, the property’s fair values are based on valuations
performed by Ingo Buchert Property Valuation Services, an accredited independent valuer.
Significant unobservable valuation input:
Price per square metre
Range
$205 – $240
Significant increases (decreases) in estimated price per square metre in isolation would result in a significantly higher
(lower) fair value.
If land and buildings were measured using the cost model, the carrying amounts would be as follows:
Cost
Accumulated depreciation
Net book value
2016
$'000
529
(66)
463
2015
$'000
619
(77)
542
10. EXPLORATION AND EVALUATION EXPENDITURE
Opening balance
Expenditure incurred during the year
Foreign currency translation movements
Sale of royalty
Closing balance
Consolidated
2016
$'000
2015
$'000
61,262
1,516
(8,502)
(5,517)
48,759
54,899
3,289
3,074
-
61,262
Expenditure incurred during the period comprises expenditure on geological, feasibility and associated activities.
The value of the Company’s interest in exploration and evaluation expenditure is dependent upon:
(cid:120) the continuance of the Company’s rights to tenure of the areas of interest;
(cid:120) the results of pre-development activities; and
(cid:120) the recoupment of costs through successful development and exploitation of the areas of interest, or
alternatively, by their sale.
Etango Uranium Project – Bannerman 100%
The Etango Uranium Project is situated near Rio Tinto’s Rössing uranium mine, Paladin’s Langer Heinrich uranium
mine and CGNPC’s Husab uranium mine currently under construction. Bannerman, in 2012, completed a
Definitive Feasibility Study (“DFS”) on a 7-9 million pounds U3O8 per annum open pit mining and heap leach
processing operation at Etango. The DFS confirmed the technical, environmental and financial (at consensus
long term uranium prices) viability of a large open pit and heap leach operation at one of the world’s largest
undeveloped uranium deposits. In 2015, Bannerman commenced a large scale heap leach demonstration
program to provide further assurance to financing parties, generate process information for the detailed
engineering design phase and build and enhance internal capability.
On 11 November 2015, the Company announced the results of the DFS Optimisation Study (“OS”). The OS
focussed primarily on the geology and mining aspects of the project and incorporated an updated Mineral
Resource model that simulates the selectivity associated with the established process of radiometric truck
scanning in uranium mining. A relatively minor amount of additional drilling was also included in the model.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
55
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
Capital costs and operating costs were updated to ensure that these estimates remained current and reflect the
prevailing economic climate. The mine plan was updated to incorporate the aforementioned changes and
included updated pit optimisations, pit designs, geotechnical review and mine production schedules employing
variable cut-off grade policies.
In addition, on 11 November 2015, the Company announced the signing of agreements with RCF and with Mr
Clive Jones. The agreements entailed grant of a 0.75% royalty to each of RCFIV and RCFVI over the Etango
Project and to acquire the minority interest (20%) in the Etango Project from the current owners (represented by
Mr Clive Jones) for payment of approximately 123.4 million new Bannerman shares and A$1 million in cash. The
agreements were subsequently approved by shareholders on 29 December 2015 and completed on 31
December 2015.
The grant of a 0.75% royalty to each of RCFIV and RCFVI over the Etango Project has been credited against the
exploration and evaluation asset. The payment of the royalty is contingent upon, amongst other things, the
receipt of a mining licence, the completion of financing for the construction of the mine site and commencement
of production at the Etango Project.
Both royalties are secured by a fixed and floating charge over the assets of the Company’s wholly-owned
subsidiary, Bannerman Resources Nominees (UK) Ltd (“BMNUK”), a pledge over the shares held by BMNUK in
BMRN, and a security interest over the Company’s beneficial interest in the BMRN shares.
The fair value of the royalty payable has been independently valued as at the date of the completion of the
agreements and estimated using a DCF model adjusted for typical risk factors. The valuation requires
assumptions to be made about the input parameters, including forecast cash flows and the discount rate. The
significant unobservable valuation inputs are as follows:
(cid:120)
(cid:120)
(cid:120)
The receipt of a mining licence;
The completion of financing of the construction of the project; and
The commencement of production.
Significant increases (decreases) in estimated unobservable inputs in isolation would result in significantly higher
(lower) fair value.
The Etango Project comprises one Exclusive Prospecting Licence (“EPL”) 3345 in Namibia.
The Namibian Ministry of Mines and Energy (“MME”) has endorsed the renewal of EPL 3345. The licence has
been renewed until 25 April 2017 in accordance with its original term.
The Company has received correspondence from the MME stating that the Honourable Minister intends to
refuse the application for the Etango project Mining Licence, which was applied for in December 2009, citing the
current low uranium price. The Honourable Minister’s decision is not unexpected and Bannerman retains the
right to re-apply for a mining licence when the uranium market recovers.
The Ministry of Environment and Tourism granted Bannerman initial Environmental Clearances for the Etango
Project in 2010 and for the project’s Linear Infrastructure in 2012, both of which are important pre-requisites for
a Mining Licence. A renewal for the Etango Project Environmental Clearance was granted in November 2015 for
a further 3 years while the renewal for the project’s Linear Infrastructure Environmental Clearance was granted
in May 2016 also for a further 3 years.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
56
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
Exploration & Evaluation Expenditure for the Etango Project
Consolidated
30 June 2016
$’000
30 June 2015
$’000
Opening balance
Drilling and consumables
Assays and freight
Salaries and wages
Consultants and contractors
Demonstration plant construction cost
Demonstration plant change in rehabilitation provision
Demonstration plant operational cost
Travel and accommodation
Other
Total expenditure for the period
Foreign currency translation movements
Sale of royalty
Closing balance
11. TRADE AND OTHER PAYABLES
Trade payables
Other payables and accruals
61,262
-
2
691
272
51
34
350
5
111
1,516
(8,502)
(5,517)
48,759
54,899
4
-
675
181
1,631
399
317
15
67
3,289
3,074
-
61,262
132
28
160
403
290
693
Trade payables are non-interest bearing and are normally settled on 30 day terms (or less). Other payables are
non-interest bearing and have an average term of 60 days.
Fair value
Due to the short term nature of these payables, their carrying value is assumed to approximate their fair value.
12. INTEREST BEARING LIABILITIES
Non Current
Secured convertible note
RCFIV and RCFVI convertible notes
-
-
10,281
10,281
On 11 November 2015, the Company announced the signing of agreements with RCF and approved by
shareholders on 29 December 2015 and completed on 31 December 2015, to extinguish the convertible notes.
The agreement entailed the conversion of A$8 million of the convertible notes held by RCF into Bannerman
shares at the given conversion price of A$0.075 per share; grant of a 0.75% royalty to each of RCFIV and RCFVI
over the Etango Project comprising A$2 million in cash and extinguishment of the residual convertible notes held
by RCF (A$4 million). The difference between the consideration paid and the carrying value of the debt resulted
in a gain on extinguishment.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
57
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
13. PROVISIONS – NON-CURRENT
Rehabilitation provision
Balance 1 July 2015
Arising during the year
Unwinding of discount
Foreign exchange translation movements
Consolidated
2016
$’000
2015
$’000
370
399
-
30
(59)
370
399
-
399
-
-
399
The Group makes full provision for the future cost of the environmental rehabilitation obligations relating to the
heap leach demonstration plant on a discounted basis at the time of the activity.
The rehabilitation provision, based on the Group’s internal estimates, represents the present value of the future
rehabilitation costs relating to the heap leach demonstration plant. Assumptions based on the current economic
environment have been made, which management believes are a reasonable basis upon which to estimate the
future liability. These estimates are reviewed regularly to take into account any material changes to the
assumptions. However, actual rehabilitation costs will ultimately depend upon future market prices for the
necessary rehabilitation works required that will reflect market conditions at the relevant time. Furthermore,
the timing of the rehabilitation is likely to depend on when the pre-development activities cease.
The discount rate, which is based on the Namibian risk free rate, used in the calculation of the provision as at 30
June 2016 is 8.5% (June 2015: 8.5%).
14. CONTRIBUTED EQUITY
(a)
Issued and outstanding:
Ordinary shares
Issued and fully paid
Movements in ordinary shares on issue
Balance 1 July 2014
-
-
-
-
-
Issue of shares (i)
Issue of shares (ii)
Share Purchase Plan (iii)
Share Purchase Plan Shortfall Placements (iv)
Share issue costs
Balance 30 June 2015
Balance 1 July 2015
-
-
-
-
-
-
Issue of shares (v)
Issue of shares (vi)
Issue of shares (vii)
Issue of shares (viii)
Issue of shares (ix)
Issue of shares (x)
Balance 30 June 2016
June 2016
June 2015
June 2016
June 2015
Number of Shares
Amount
‘000
‘000
$’000
$’000
709,974
382,914
129,634
119,468
Number of Shares
’000
Amount
$’000
326,653
3,810
13,990
7,836
30,625
-
382,914
382,914
12,759
20,918
66,667
40,000
63,291
123,425
709,974
116,730
-
883
408
1,592
(145)
119,468
119,468
-
723
1,867
1,120
3,000
3,456
129,634
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
58
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
(i)
(ii)
(iii)
(iv)
(v)
(vi)
On 27 November 2014, 1,198,166 ordinary shares were issued upon vesting of performance rights.
The following shares were issued upon vesting of performance rights:
a.
On 9 August 2014, 750,000 ordinary shares were issued upon vesting of performance rights.
b. On 20 November 2014, 861,440 ordinary shares were issued upon vesting of performance rights.
c.
d. On 6 February 2015, 1,000,000 ordinary shares were issued upon vesting of performance rights.
The following shares were issued in satisfaction of the interest payable on the two convertible notes in accordance
with the convertible notes’ terms:
a.
On 10 July 2014, 2,279,452 shares were issued in satisfaction of the A$159,562 interest payable on the
convertible note with RCFIV for the period 1 April 2014 to 30 June 2014.
b. On 10 July 2014, 62,622 shares were issued in satisfaction of the A$4,384 interest payable on the convertible
c.
note with RCFVI for the period 26 June 2014 to 30 June 2014.
On 13 October 2014, 2,304,501 shares were issued in satisfaction of the A$161,315 interest payable on the
convertible note with RCFIV for the period 1 July 2014 to 30 September 2014.
d. On 13 October 2014, 1,152,250 shares were issued in satisfaction of the A$80,658 interest payable on the
e.
f.
g.
convertible note with RCFVI for the period 1 July 2014 to 30 September 2014.
On 9 January 2015, 2,304,501 shares were issued in satisfaction of the A$161,315 interest payable on the
convertible note with RCFIV for the period 1 October 2014 to 31 December 2014.
On 9 January 2015, 1,152,250 shares were issued in satisfaction of the A$80,658 interest payable on the
convertible note with RCFVI for the period 1 October 2014 to 31 December 2014.
On 10 April 2015, 3,156,164 shares were issued in satisfaction of the A$157,808 interest payable on the
convertible note with RCFIV for the period 1 January 2015 to 31 March 2015.
h. On 10 April 2015, 1,578,082 shares were issued in satisfaction of the A$78,904 interest payable on the
convertible note with RCFVI for the period 1 January 2015 to 31 March 2015.
On 21 April 2015, the Company completed a Share Purchase Plan comprising of 7,836,482 fully paid ordinary shares at
an issue price of A$0.052.
Subsequent to the Share Purchase Plan, the Company completed Shortfall Placements with existing shareholders,
comprising of 21,346,153 fully paid ordinary shares on the same terms as the Share Purchase Plan and 9,278,845 fully
paid ordinary shares on the same terms as the Share Purchase Plan to three directors, namely Ronnie Beevor, Len
Jubber and David Tucker as approved at the Extraordinary General Meeting of Shareholders held on 30 June 2015.
The following shares were issued upon vesting of performance rights
a.
On 21 December 2015, 4,719,509 ordinary shares were issued upon vesting of share and performance rights in
accordance with the terms of the Non-Executive Director Share Incentive Plan and Employee Incentive Plan.
b. On 28 April 2016, 8,040,205 ordinary shares were issued upon vesting of share and performance rights in
accordance with the terms of the Employee Incentive Plan.
The following shares were issued in satisfaction of the interest payable on the two convertible notes in accordance
with the convertible notes’ terms:
a.
On 7 July 2015, 3,191,233 shares were issued in satisfaction of the A$159,562 interest payable on the
convertible note with RCFIV for the period 1 April 2015 to 30 June 2015.
b. On 7 July 2015, 1,595,616 shares were issued in satisfaction of the A$79,781 interest payable on the convertible
c.
note with RCFVI for the period 1 April 2015 to 30 June 2015.
On 11 November 2015, 5,377,169 shares were issued in satisfaction of the A$161,315 interest payable on the
convertible note with RCFIV for the period 1 July 2015 to 30 September 2015.
d. On 11 November 2015, 2,688,584 shares were issued in satisfaction of the A$80,658 interest payable on the
e.
f.
convertible note with RCFVI for the period 1 July 2015 to 30 September 2015.
On 31 December 2015, 5,377,169 shares were issued in satisfaction of the A$161,315 interest payable on the
convertible note with RCFIV for the period 1 October 2015 to 31 December 2015.
On 31 December 2015, 2,688,584 shares were issued in satisfaction of the A$80,658 interest payable on the
convertible note with RCFVI for the period 1 October 2015 to 31 December 2015.
(vii)
On 31 December 2015, 66,666,667 shares were issued to RCFIV as satisfaction for the conversion of the outstanding
amounts under the RCFIV Convertible Note Facility.
(viii) On 31 December 2015, 40,000,000 shares were issued to RCFVI as satisfaction for the conversion of the outstanding
(ix)
(x)
amounts under the RCFVI Convertible Note Facility.
On 31 December 2015, 63,291,139 shares were issued to RCFVI pursuant to a A$3 million placement at $0.0474.
On 31 December 2015, 123,424,534 shares were issued to Clive Jones (and his nominees) as satisfaction for the part-
consideration for the remaining 20% interest in the Company’s Etango Project.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
59
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
(b)
Share options on issue:
The movements in share options during the year were as follows:
Expiry Dates
Exercise
Price
Balance
1 Jul 15
Granted
Exercised
21 November 2015
A$0.12
22 November 2016
A$0.072
15 November 2017
A$0.089
15 November 2018
A$0.044
25 July 2019
A$0.045
25 July 2019
A$0.057
25 July 2019
A$0.07
Weighted average exercise price ($)
Average life to expiry (years)
1,795,200
4,504,000
3,664,400
-
-
-
-
-
-
-
7,846,000
5,000,000
7,500,000
7,500,000
9,963,600
27,846,000
0.09
1.4
0.05
3.3
-
-
-
-
-
-
-
-
-
-
Expired /
Cancelled
(1,795,200)
-
-
-
-
-
-
Balance
30 Jun 16
Vested
30 Jun 16
-
-
4,504,000
4,504,000
3,664,400
3,664,400
7,846,000
-
5,000,000
5,000,000
7,500,000
7,500,000
-
-
(1,795,200)
36,014,400
13,168,400
0.12
-
0.06
1.69
0.07
1.2
The remaining unvested share options above have performance hurdles linked to minimum service periods. The
5,000,000 vested share options above are not exercisable as at 30 June 2016. These share options were
approved by Shareholders 25 July 2016 and became exercisable on that date.
Directors held 36,014,400 share options as at 30 June 2016 with an average exercise price of $0.06 per share and
an average life to expiry of 1.69 years.
Performance Rights on issue
(c)
The performance rights on issue as at 30 June 2016 were as follows:
Vesting Dates
11 November 2015
15 November 2015
21 November2015
22 November 2015
15 November 2016
22 November 2016
15 November 2017
15 November 2018
Balance
1 Jul 15
170,000
686,344
3,502,674
759,519
2,132,015
5,095,630
7,729,029
Granted
Vested
Cancelled /
Forfeited
Balance
30 Jun 16
-
-
-
-
(170,000)
(686,344)
(3,288,212)
(574,953)
1,335,300
-
-
(2,874,988)
-
-
(214,462)
(184,566)
(381,044)
(874,997)
4,933,800
(2,084,758)
(3,113,529)
-
21,482,300
(3,080,459)
(10,712,641)
-
-
-
-
3,086,271
1,345,645
7,464,542
7,689,200
Average life to vesting (years)
1.08
1.6
-
-
0.9
20,075,211
27,751,400
(12,759,714)
(15,481,239)
19,585,658
Note: Performance rights have no exercise price.
The performance rights have been issued in accordance with the shareholder-approved EIP and NEDSIP, and vest
into shares for no consideration on the completion of minimum service periods and, in certain cases, the
achievement of specified vesting hurdles related to the Company’s relative share price performance, internal
business targets and/or personal performance.
Directors held 862,100 performance rights as at 30 June 2016 with an average life to vesting of 0.38 years.
Terms of Ordinary Shares
Ordinary shares participate in dividends and the proceeds on winding up of the Company in proportion to the
number of shares held and in proportion to the amount paid up on the shares held. At shareholders’ meetings,
each ordinary share is entitled to one vote in proportion to the paid up amount of the share when a poll is called,
otherwise each shareholder has one vote on a show of hands.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
60
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
Capital Management
For the purpose of the Group’s capital management, capital includes issued capital and all other equity reserves
attributable to the equity holders of the parent. When managing capital, management’s objective is to ensure
the entity continues as a going concern as well as to obtain optimal returns to shareholders and benefits for
other stakeholders. Management also aims to maintain a capital structure which assists to ensure the lowest
appropriate cost of capital available to the Company. Refer to Note 1 with regards to going concern
considerations.
15. RESERVES
Share-based payment reserve
Foreign currency translation reserve
Asset revaluation reserve
Convertible note reserve
Equity reserve
TOTAL RESERVES
Consolidated
2016
$'000
2015
$'000
(a)
(b)
(c)
(d)
(e)
54,598
(31,198)
167
4,038
(5,602)
54,058
(22,673)
167
4,038
-
22,003
35,590
(a) Share-based Payment Reserve
Balance at the beginning of the reporting period
Share-based payment vesting expense during the period
Balance at the end of the reporting period
54,058
540
54,598
53,523
535
54,058
The Share-based Payment Reserve is used to recognise the value of equity-settled share-based payment
transactions for the acquisition of project interests and the provision of share-based incentives to directors,
employees and consultants.
(b) Foreign Currency translation reserve
Reserves at the beginning of the reporting period
Currency translation differences arising during the year
Balance at the end of the reporting period
(22,673)
(8,525)
(31,198)
(25,648)
2,975
(22,673)
The Foreign Currency Translation Reserve is used to record exchange differences arising on translation of the
Group entities that do not have a functional currency of Australian dollars and have been translated into
Australian dollars for presentation purposes.
As per the Statement of Comprehensive Income, the foreign currency translation difference arising for the year
ended 30 June 2016 amounted to $8,605,000 (2015: $2,999,000), allocated between non-controlling interests of
$80,000 (2015: $44,000) and the Group of $8,525,000 (2015: $2,975,000). Over the year, the Australian dollar
strengthened against the Namibian dollar, with a movement of approximately 14% from the rate as at 30 June
2015 (A$1.00:N$9.42) to the rate as at 30 June 2016 (A$1.00:N$11.01).
(c) Asset Revaluation reserve
Reserves at the beginning of the reporting period
Balance at the end of the reporting period
167
167
167
167
The Asset Revaluation Reserve is used to record increases and decreases (to the extent that such decrease
relates to an increase on the same asset previously recognised in equity) in the fair value of land and buildings.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
61
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
(d) Convertible Note reserve
Reserves at the beginning of the reporting period
Balance at the end of the reporting period
4,038
4,038
4,038
4,038
The convertible note reserve records the equity portion of the RCFIV convertible note issued on 16 December
2008, refinanced on 31 March 2012 and 22 November 2013, and the RCFVI convertible note issued on 19 June
2014, as described in Note 10. The convertible notes were extinguished on 31 December 2015.
(e) Equity reserve
Reserves at the beginning of the reporting period
Non-controlling interest acquired during the period
Balance at the end of the reporting period
-
(5,602)
(5,602)
-
-
-
On 11 November 2015, the Company announced the signing of an agreement with Mr Clive Jones, subject to
shareholders approval, to acquire the minority interest (20%) in the Etango Project from the current owners
(represented by Mr Clive Jones) for payment of approximately 123.4 million new Bannerman shares and A$1
million in cash. The acquisition was subsequently approved by shareholders at Extraordinary General Meeting
on 29 December 2015 and the Company moved to 100% ownership of the Etango Uranium Project.
The group recognised a decrease in non-controlling interests of A$1,146,000 and a decrease in equity
attributable to the owners of the parent of A$5,602,000. The effect on the equity attributable to the owners of
the Group during the period is summarised as follows:
Carrying amount of non-controlling interest acquired
Consideration paid to non-controlling interests
Excess of consideration paid recognised in equity
16. FINANCIAL INSTRUMENTS
$’000
(1,146)
(4,456)
(5,602)
The Group’s principal financial instruments comprise cash and short term deposits, receivables, payables,
convertible notes and finance leases.
Set out below is an overview of financial instruments, other than cash and short-term deposits, held by the
Group as at 30 June 2016.
Financial assets
Trade and other receivables
Total non-current
Trade and other receivables
Total current
Total
Financial liabilities
Interest bearing liabilities
Total non-current
Trade and other payables
Total current
Total
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
Consolidated
2016
$'000
2015
$'000
15
15
27
27
42
-
-
160
160
160
15
15
166
166
181
10,281
10,281
693
693
10,974
62
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
Fair Values
The carrying value and net fair values of financial assets and liabilities at balance date are:
2016
2015
Carrying
Amount
$'000
Net fair
Value
$'000
Carrying
Amount
$'000
Net fair
Value
$'000
15
15
27
27
42
-
-
160
160
160
15
15
27
27
42
-
-
160
160
160
15
15
166
166
181
10,281
10,281
693
693
10,974
15
15
166
166
181
10,281
10,281
693
693
10,974
Financial assets
Trade and other receivables
Total non-current
Trade and other receivables
Total current
Total
Financial liabilities
Interest bearing liabilities
Total non-current
Trade and other payables
Total current
Total
(cid:120)
The fair value of the financial assets and liabilities is included at the amount at which the instrument could be
exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. The
following methods and assumptions were used to estimate the fair values:
(cid:120) Management assessed that cash and short-term deposits, trade receivables, other current receivables,
trade payables, and other current liabilities approximate their carrying amounts largely due to the short-
term maturities of these instruments.
Long-term fixed-rate and variable-rate receivables/borrowings are evaluated by the Group based on
parameters such as interest rates, specific country risk factors, individual creditworthiness of the customer
and the risk characteristics of the financed project. Based on this evaluation, allowances are taken into
account for the expected losses of these receivables. As at 30 June 2016, the carrying amounts of such
receivables, net of allowances, were not materially different from their calculated fair values.
The fair value of the convertible notes has been determined by discounting the cash-flows over the term of
the facility, being the coupon interest and principal repayable on maturity, using a market interest rate for a
similar instrument that does not have the conversion feature.
(cid:120)
Financial risk management objectives and policies
The Group uses different methods to measure and manage different types of risks to which it is exposed. These
include the monitoring of levels of exposure to interest rates and foreign exchange risk and assessments of
market forecasts for interest rate and foreign exchange prices. Liquidity risk is monitored through the
development of future rolling cash flow forecasts and financing plans.
The Board reviews and agrees policies for managing each of the above risks and they are summarised below:
(a)
Interest Rate Risk
Interest rate risk is managed by obtaining competitive commercial deposit interest rates available in the
market from major Australian financial institutions.
The Group’s exposure to interest rate risk, which is the risk that a financial instrument’s value will fluctuate as
a result of changes in market interest rates, and the effective weighted average interest rate for each class of
financial assets and financial liabilities, comprises:
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
63
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
Consolidated
2016
Financial assets
Cash
Weighted average
interest rate
Consolidated
2015
Financial assets
Cash
Weighted average
interest rate
Financial liabilities
Interest bearing liabilities
Weighted average
interest rate
Floating
Interest Rate
$'000
Fixed Interest
maturing in 1
year or less
$'000
Fixed Interest
maturing over 1
to 5 years
$'000
Total
$'000
1,580
1,580
20
20
-
-
1,600
1,600
0.3%
Floating
Interest Rate
$'000
Fixed Interest
maturing in 1
year or less
$'000
Fixed Interest
maturing over 1
to 5 years
$'000
Total
$'000
1,444
1,444
-
-
847
847
-
-
-
-
10,281
10,281
2,291
2,291
2.7%
10,281
10,281
8.0%
The following table summarises the impact of reasonably possible changes in interest rates for the Group at
30 June 2016. The sensitivity analysis is based on the assumption that interest rates change by 1% with all
other variables remaining constant. The 1% sensitivity is based on reasonably possible changes over a
financial year, using the observed range of actual historical rates for the preceding 5 year period and
management’s expectation of short term future interest rates.
Impact on post-tax gain/(loss):
1% increase
1% decrease
Consolidated
2016
$'000
15
(15)
2015
$'000
7
(8)
There is no impact on other reserves in equity for the Group.
(b) Foreign Currency Risk
Foreign exchange risk arises from future commitments, assets and liabilities that are denominated in a
currency that is not the functional currency of the relevant Group company.
The Group’s deposits are largely denominated in Australian dollars. Currently there are no foreign exchange
hedge programs in place. The Group manages the purchase of foreign currency to meet operational
requirements.
The impact of reasonably possible changes in foreign exchange rates for the Group is not material.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
64
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
(c) Credit Risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial
loss to the Group. The Group has adopted the policy of dealing only with creditworthy counterparties and
obtaining sufficient collateral or other security where appropriate, as a means of mitigating the risk of
financial loss from defaults.
The carrying amount of financial assets recorded in the financial statements, net of any provisions for losses,
represents the Group’s maximum exposure to credit risk. For the remaining financial assets, there are no
significant concentrations of credit risk within the Group and financial instruments are being spread amongst
highly rated financial institutions and related parties to minimise the risk of default of counterparties.
(d) Liquidity
Liquidity is monitored through the development of monthly expenditure and rolling cash flow forecasts. Short
term liquidity is managed on a day to day basis by the finance management team including the use of weekly
cash forecasts.
The risk implied from the values shown in the table below reflects a balanced view of cash outflows:
Financial Liabilities
2016
Trade and other payables
Interest bearing liabilities
Total
2015
Trade and other payables
Interest bearing liabilities
Total
<6 months
$’000
160
-
160
6-12 months
$’000
-
-
-
693
-
693
-
-
-
1– 5 years
$’000
-
-
-
-
12,000
12,000
Total
$’000
160
-
160
693
12,000
12,693
17. FAIR VALUE MEASUREMENT
The following table provides the fair value measurement hierarchy of the Group’s assets and liabilities.
Quantitative disclosures fair value measurement hierarchy for assets as at 30 June 2016:
Fair value measurement using
Date of
valuation
Total
Quoted prices in
active markets
$'000
(Level 1)
$'000
Significant
observable
inputs
(Level 2)
$'000
Significant
unobservable
inputs
(Level 3)
$'000
Assets measured at fair value
Revalued property, plant and equipment
(Note 9)
Office property Namibia
31 May 2016
660
Assets for which fair values are disclosed
(Note 16)
Trade and other receivables
-
Current
- Non-current
30 June 2016
30 June 2015
27
15
Liabilities measured at fair value
Liabilities for which fair values are
disclosed (Note 16)
Trade and other payables
30 June 2016
160
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
-
-
-
-
-
-
-
-
660
27
15
160
65
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
18. LOSS PER SHARE
Basic and diluted loss per share to the ordinary equity holders of the
Company (cents per share)
Loss used in the calculation of weighted average basic and dilutive
loss per share
Weighted average number of ordinary shares outstanding during the
period used in the calculation of basic loss per share
2016
(0.02)
$'000
(113)
2015
(1.21)
$'000
(4,137)
Number of
Shares
'000
547,420
Number of
Shares
'000
341,741
Number of share options / performance rights issued that could be
potentially dilutive but are not included in diluted EPS as they are
anti-dilutive for the periods presented.
55,600
30,039
There have been no other conversions to or subscriptions for ordinary shares or issues of potential ordinary
shares since the balance date and before the completion of this report.
19. CASH FLOW INFORMATION
(a)
Reconciliation from the net loss after tax to the net cash flow
from operating activities
Loss after income tax
Non-cash flows in operating loss
Depreciation
Share-based payments
Gain on extinguishment of convertible note
(Loss)/profit on sale of property, plant and equipment
Interest expense
Changes in assets and liabilities
(Increase) / decrease in receivables and prepayments
Increase / (decrease) in trade and other creditors and accruals
Increase / (decrease) in provisions
Consolidated
2016
$'000
2015
$'000
(152)
(4,241)
53
540
(4,414)
8
1,126
(15)
(183)
(108)
88
535
-
(14)
2,022
(36)
94
26
Net cash outflows from Operating Activities
(3,145)
(1,526)
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
66
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
20. COMMITMENTS
a)
Exploration and evaluation expenditure
Statutory two-year renewal of the Etango (EPL 3345) Exclusive Prospecting Licence can be applied for under
applicable Namibian minerals legislation. An application to renew the EPL, which expired on 26 April 2015, was
lodged on 26 January 2015 and was renewed in 2016.
In order to maintain current rights of tenure to mineral licences, the Group has exploration and evaluation
expenditure obligations up until the expiry of those licences. The following stated obligations, which are subject
to renegotiation upon expiry of the current licences, are not provided for in the financial statements and
represent a commitment of the Group:
Not longer than one year
Longer than one year, but not longer than five years
Longer than five years
Consolidated
2016
$'000
2015
$'000
-
-
-
-
801
663
-
1,464
If the Group decides to relinquish certain mineral licences and/or does not meet these minimum expenditure
obligations or obtain appropriate waivers, assets recognised in the Statement of Financial Position may require
review to determine the appropriateness of carrying values. The sale, transfer or farm-out of exploration rights
to third parties will reduce or extinguish these obligations.
b) Operating lease commitments
The Group has entered into a lease for office premises. This lease has an initial lease term of 2 years.
Not longer than one year
Longer than one year, but not longer than five years
Longer than five years
21. SHARE-BASED PAYMENT PLANS
Recognised employee share-based payment expenses
53
44
-
97
57
-
-
57
The expense recognised for employee services received during the year are shown in the table below:
Total expense arising from employee and director share-based
payment transactions
Types of share-based payment plans
Employee Incentive Plan ("EIP")
Consolidated
2016
$'000
2015
$'000
540
535
Performance rights are granted to all employees. The EIP is designed to align participants' interest with those of
shareholders by increasing the value of the Company's shares. For grants of performance rights under the EIP,
the vesting of half of the performance rights is subject to the Company’s relative TSR as measured by share price
performance (allowing for the reinvestment of dividends), versus a comparator group of uranium development
companies, and the vesting of the other half is subject to the attainment of defined individual and group
performance criteria as assessed by the Board in line with the work schedules under the Company’s operating
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
67
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
plans. The performance measurement date is two years from date of grant for employees and three years from
the date of grant for executives.
In assessing whether the relative TSR hurdle for each grant has been met, the Group's TSR growth from the
commencement of each grant and that of the pre-selected peer group are ranked. The peer group chosen for
comparison is a group of Australian and foreign uranium development companies at the date of grant. This peer
group reflects the Group's competitors for capital and talent.
The Group's performance against the hurdle is determined according to Bannerman’s ranking against the peer
group TSR growth over the performance period:
(cid:120) When Bannerman is ranked at the 75th percentile, 100% of the performance rights will vest.
(cid:120) When Bannerman is ranked below the 25th percentile, the performance rights are forfeited.
(cid:120)
For rankings between the 25th and 75th percentile, a sliding scale applies whereby every 1 percentile
equates to 2% vesting.
When a participant ceases employment prior to the vesting of their rights, the rights are generally forfeited
unless cessation of employment is due to termination initiated by the Group (except for termination with cause)
or death. In the event of a change of control, the performance period end date will be bought forward to the
date of change of control and rights will vest. The Company prohibits executives from entering into
arrangements to protect the value of unvested EIP awards.
Non-Executive Director Share Incentive Plan ("NEDSIP")
Non-executive directors' remuneration includes initial and annual grants of share options or share rights (under
the NEDSIP). Share options and share rights granted to non-executive directors are not subject to performance
hurdles. They have been issued as an incentive to attract experienced and skilled personnel to the Board.
Summary of share options granted under NEDSIP and EIP arrangements
Outstanding at beginning of the year
Granted during the year
Exercised during the year
Expired during the year
Forfeited during the year
Outstanding at end of the year
1 Weighted Average Exercise Price ($/share)
2016
#
9,963,600
7,846,000
-
(1,795,200)
-
16,014,400
2016
WAEP1
0.09
0.04
-
0.12
-
0.06
2015
#
8,701,700
3,664,400
-
(902,500)
(1,500,000)
9,963,600
2015
WAEP1
0.22
0.09
-
0.36
0.678
0.09
Summary of share options granted outside of NEDSIP and EIP arrangements
Outstanding at beginning of the year
Granted during the year
Outstanding at end of the year
1 Weighted Average Exercise Price ($/share)
2016
#
-
20,000,000
20,000,000
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
2016
WAEP1
2015
#
2015
WAEP1
-
0.06
0.06
-
-
-
-
-
-
68
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
Summary of performance rights granted under NEDSIP and EIP arrangements
Outstanding at beginning of the year
Granted during the year
Vested during the year
Forfeited during the year
Outstanding at end of the year
2016
#
20,075,211
27,751,400
(12,759,714)
(15,481,239)
19,585,658
2015
#
15,523,183
10,717,388
(3,809,606)
(2,355,754)
20,075,211
Weighted average remaining contractual life
The weighted average remaining contractual life as at 30 June 2016 was:
(cid:120)
(cid:120)
Share options
Performance rights
1.69 years (2015: 1.3 years).
0.94 years (2015: 0.84 years).
Range of exercise price
The range of exercise prices for share options outstanding as at 30 June 2016 was $0.044 - $0.089 (2015: $0.072 -
$0.12). The weighted average exercise price for share options outstanding as at 30 June 2016 was $0.06 (2015:
$0.09) per share option.
Weighted average fair value
The weighted average fair value for the share options granted during the year was $0.01 (2015: $0.03) per share
option. The weighted average fair value for the performance rights granted during the year was $0.03 (2015:
$0.07) per performance right.
Share options / performance rights pricing model
Equity-settled transactions
The fair value of the equity-settled share options granted under the NEDSIP and EIP is estimated as at the date of
grant using a Black-Scholes option price calculation method taking into account the terms and conditions upon
which the share options/rights were granted. A Monte Carlo simulation is applied to fair value the TSR element.
In accordance with the rules of the EIP, the model simulates the Company's TSR and compares it against the peer
group over the two year period of each grant made to employees and the three year period of each grant made
to executives. The model takes into account the historic dividends, share price volatilities and co-variances of the
Company and each comparator company to produce a theoretical predicted distribution of relative share
performance. This is applied to the grant to give an expected value of the TSR element.
Pricing model inputs used for the year ended 30 June 2016:
NEDSIP
Annual Grant
Share Options
NEDSIP
Annual Grant
Rights
OTHER (i)
Annual
Grant Rights
EIP
Annual Grant
Rights
OTHER (i)
Director
Options
0%
81%
2.75%
3 years
0%
85%
2.75%
1 year
0%
81%
2.75%
1 year
0%
87%
1.76% - 1.98%
2 - 3 years
0%
83%
1.75%
3 year
Dividend Yield (%)
Expected volatility (%)
Risk- Free interest rate (%)
Expected life of Share Options /
Rights (years)
Share price at measurement date ($)
0.059
0.029
0.029
0.028 - 0.03
0.03
(i)
Share Options/Rights issued under separate terms and conditions and not issued as part of any formal plan.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
69
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
Pricing model inputs used for the year ended 30 June 2015:
NEDSIP
NEDSIP
OTHER (i)
EIP
Annual Grant
Annual Grant
Dividend Yield (%)
Expected volatility (%)
Share Options
0%
85%
Risk- Free interest rate (%)
2.75%
Expected life of Share options
/ Rights (years)
Share price at measurement
date ($)
3 years
Rights
0%
85%
2.75%
1 year
Annual Grant
Rights
Annual Grant
Rights
0%
85%
0%
82%
2.75%
2.58% - 2.57%
1 year
2 - 3 years
0.059
0.059
0.059
0.054 - 0.08
(i)
Rights issued under separate terms and conditions and not issued as part of any formal plan.
22. SEGMENT INFORMATION
The Group has identified its operating segments based on the internal reports that are reviewed and used by the
CEO and the management team in assessing performance and in determining the allocation of resources.
The Group is undertaking development studies and exploring for uranium resources in southern Africa, and
hence the operations of the Group represent one operating segment.
The accounting policies applied for internal reporting purposes are consistent with those applied in the
preparation of the financial statements. The Group considers the segment assets and liabilities to be consistent
with those disclosed in the financial statements.
The analysis of the location of non current assets other than financial instruments is as follows:
Australia
Namibia
Total Non Current Assets
Consolidated
2016
$'000
63
49,418
49,481
2015
$'000
71
62,063
62,134
23. EVENTS SUBSEQUENT TO REPORTING DATE
No other matters or circumstances have arisen since the end of the financial period which significantly affected
or may significantly affect the operations of the Consolidated Entity, the results of those operations, or the state
of affairs of the Consolidated Entity in future financial years.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
70
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
24. RELATED PARTY INFORMATION
Subsidiaries
The consolidated financial statements include the financial statements of Bannerman Resources Limited and the
subsidiaries listed in the following table:
Name
Bannerman Mining Resources (Namibia) (Pty) Ltd
Elfort Nominees Pty Ltd
Bannerman Resources Nominees (UK) Limited
Country of
incorporation
Namibia
Australia
United Kingdom
% Equity Interest
2016 2015
80
100
100
100
100
100
Ultimate Parent
Bannerman Resources Limited is the ultimate Australian parent entity and the ultimate parent of the Group.
Compensation of Key Management Personnel by Category:
Short-term employee benefits
Post-employment benefits
Share-based payments
2016
$'000
2015
$'000
768
115
409
1,292
754
105
446
1,305
Transactions with related entities:
Transactions between related parties are on commercial terms and conditions, no more favourable than those
available to other parties unless otherwise stated.
Mr Clive Jones, a director of Bannerman, was the registered holder of the 20% non-controlling interest in
Bannerman Mining Resources (Namibia) (Pty) (Ltd) and held that interest for his associates and business partner.
Mr Jones holds a relevant interest in 77,207,668 shares in Bannerman, representing 10.84% of Bannerman’s
share capital.
Non-Executive Director Ian Burvill is a representative of Resource Capital Funds Management Pty Ltd (“RCFM”).
RCFIV and RCFVI, which have management agreements with RCFM’s parent company, hold 268,524,434
Bannerman shares representing 37.72% of the voting capital in Bannerman as at the date of this report.
On 11 November 2015, the Company announced the signing of agreements with RCF and Mr Clive Jones to
deliver 100% project ownership, debt elimination and new funding. The agreements were subsequently
approved by shareholders on 29 December 2015 and completed on 31 December 2015, on the terms below:
(cid:131)
acquisition of the non-controlling interest (20%) in the Etango Project from the current owners (represented
by Mr Clive Jones) for payment of approximately 123.4 million new Bannerman shares and A$1 million in
cash;
(cid:131)
extinguishment of the A$12 million convertible notes through:
o
o
conversion of A$8 million of the convertible notes held by RCF into Bannerman shares at the given
conversion price of A$0.075 per share;
sale of a 1.5% royalty over the Etango Project to RCF comprising A$2 million in cash and
extinguishment of the residual convertible notes held by RCF (comprising A$4 million); and
(cid:131) A$3 million capital raising through an equity placement of approximately 63.3 million new Bannerman
shares to RCFVI at A$0.0474 per share.
These transactions were made on commercial terms and conditions and at market rates.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
71
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
25. CONTINGENCIES
On 17 December 2008, the Company entered into a settlement agreement with Savanna Marble CC (“Savanna”)
relating to Savanna’s legal challenge to the Company’s rights to the Etango Project Exclusive Prospecting Licence.
Under the terms of the Savanna settlement agreement, in consideration for the termination of proceedings,
Savanna was entitled to receive $3.5 million cash and 9.5 million fully paid ordinary shares in Bannerman. The
first tranche payment of $3.0 million and 5.5 million shares was made in early 2009. The second and final
tranche payment of $500,000 and 4.0 million ordinary shares is due to Savanna upon receipt of the Etango
Project mining licence. The mining licence application was lodged in December 2009, and further supplementary
information has since been lodged in support of the application. Subsequent to year end, the Company
announced that it had received correspondence from the MME stating the Honourable Minster intends to refuse
the application for the Etango Project Mining Licence, citing the current low uranium price. Bannerman retains
the right to re-apply for a mining licence when the uranium market recovers. As at 30 June 2016, the probability
and timing of the grant of the mining licence is uncertain. Due to this uncertainty, the second tranche payment
has been disclosed as a contingent liability and not as a provision as at 30 June 2016.
26. PARENT ENTITY INFORMATION
a.
Information relating to Bannerman Resources Limited:
Current assets
Total assets
Current liabilities
Total liabilities
Issued capital
Accumulated loss
Option Reserve
Convertible Note Reserve
Total shareholders’ equity
Profit/(loss) of the parent entity
Total comprehensive loss of the parent entity
2016
$’000
2015
$’000
1,698
5,096
277
277
129,634
(183,097)
54,244
4,038
4,819
320
320
2,183
5,217
784
11,065
119,473
(183,417)
54,058
4,038
(5,848)
(14,396)
(14,396)
b. Details of any guarantees entered into by the parent entity in relation to the debts of its subsidiaries
There are no guarantees entered into to provide for debts of the Company's subsidiaries. The parent entity has
provided a letter to BMRN evidencing the parent’s intent to meet the financial obligations of BMRN for the
period 1 July 2015 to 30 June 2016.
c. Details of any contingent liabilities of the parent entity
Refer to Note 25 for details relating to contingent liabilities.
d. Details of any contractual commitments by the parent entity for the acquisition of property, plant or
equipment
There are no contractual commitments by the parent entity for the acquisition of property, plant and equipment
as at reporting date.
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
72
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
(EXPRESSED IN AUSTRALIAN DOLLARS)
27. MATERIAL PARTLY-OWNED SUBSIDIARIES
Financial information of subsidiaries that have material non-controlling interests are provided below:
Proportion of equity interest held by non-controlling interests:
Name
Country of
incorporation
Bannerman Mining Resources (Namibia) (Pty) Ltd
Namibia
Accumulated balances of material non-controlling interest:
Bannerman Mining Resources (Namibia) (Pty) Ltd
Loss allocated to material non-controlling interest:
Bannerman Mining Resources (Namibia) (Pty) Ltd
2016
nil
$’000
2015
20%
$’000
-
(1,027)
(119)
(80)
On 11 November 2015, the Company announced the signing of an agreement with Mr Clive Jones, subject to
shareholders approval, to acquire the non-controlling interest (20%) in the Etango Project from the vendors. The
acquisition was subsequently approved by shareholders at Extraordinary General Meeting on 29 December 2015
and the Company moved to 100% ownership of Bannerman Mining Resources (Namibia) (Pty) Ltd.
The summarised financial information of the subsidiary is provided below. This information is based on amounts
before inter-company eliminations and up to the date of acquisition of the non-controlling interest.
Bannerman Mining Resources (Namibia) (Pty) Ltd
Summarised statement of comprehensive income:
2016
$’000
2015
$’000
Other income
Administrative expenses
Loss before tax
Income tax
Loss for the year
Total comprehensive loss
Attributable to non-controlling interests
Summarised statement of financial position:
Cash and bank balances and receivables (current)
Property, plant and equipment (non current)
Exploration and evaluation expenditure (non current)
Trade and other payables (current)
Other payables (non current)
Total equity
Attributable to:
Equity holders of parent
Non-Controlling interest
Summarised cash flow information:
Operating
Investing
Financing
Net decrease in cash and cash equivalents
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
7
(203)
(195)
-
(195)
(195)
(119)
62
633
46,679
(88)
(51,238)
(3,952)
(3,952)
-
(228)
(722)
760
(190)
25
(546)
(521)
-
(521)
(521)
(80)
357
801
56,074
(215)
(62,069)
(5,052)
(4,025)
(1,026)
(232)
(3,105)
3,169
(168)
73
DIRECTORS’ DECLARATION
FOR THE YEAR ENDED 30 JUNE 2016
DIRECTORS' DECLARATION
In accordance with a resolution of the directors of Bannerman Resources Limited, I state that:
1. In the opinion of the directors:
(a) The financial statements, notes and additional disclosures included in the directors’ report designated as
audited, of the Group are in accordance with the Corporations Act 2001, including:
i)
ii)
Giving a true and fair view of the consolidated entity’s financial position as at 30 June 2016 and
its performance for the year ended on that date.
Complying with Accounting Standards and Corporations Regulations 2001.
(b) The financial statements and notes also comply with International Financial Reporting Standards as disclosed
in Note 1; and
(c)
Subject to the matters outlined in Note 1 "Going Concern", there are reasonable grounds to believe that the
Company will be able to pay its debts as and when they become due and payable.
2. This declaration has been made after receiving the declarations required to be made to the directors in
accordance with s295A of the Corporations Act 2001 for the financial year ended 30 June 2016.
On behalf of the Board
Brandon Munro
Managing Director & CEO
Perth, 13 September 2016
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
74
Ernst & Young
11 Mounts Bay Road
Perth WA 6000 Australia
GPO Box M939 Perth WA 6843
Tel: +61 8 9429 2222
Fax: +61 8 9429 2436
ey.com/au
Independent auditor’s report to the members of Bannerman Resources
Limited
Report on the financial report
We have audited the accompanying financial report of Bannerman Resources Limited, which comprises the
consolidated statement of financial position as at 30 June 2016 and 30 June 2015, the consolidated
statement of comprehensive income, the consolidated statement of changes in equity and the
consolidated cash flow statement for the years then ended, 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 years.
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 controls as the directors determine are necessary to enable the preparation of the financial
report that is free from material misstatement, whether due to fraud or error. In Note 1, the directors also
state, in accordance with Accounting Standard AASB 101 Presentation of Financial Statements, that the
financial statements comply with International Financial Reporting Standards.
Auditor’s responsibility
Our responsibility is to express an opinion on the financial report based on our audit. We conducted our
audit in accordance with Australian and International Auditing Standards. Those standards require that we
comply with relevant ethical requirements relating to audit engagements and plan and perform the audit
to obtain reasonable assurance about whether the financial report is free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in
the financial report. The procedures selected depend on the auditor's judgment, including the assessment
of the risks of material misstatement of the financial report, whether due to fraud or error. In making
those risk assessments, the auditor considers internal controls relevant to the entity's preparation and fair
presentation of the financial report 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 entity's
internal controls. 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 financial report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
audit opinion.
Independence
In conducting our audit we have complied with the independence requirements of the Corporations Act
2001. We have given to the directors of the company a written Auditor’s Independence Declaration, a
copy of which is included in the directors’ report.
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
RK:JH:Bannerman:034
Opinion
In our opinion:
a.
the financial report of Bannerman Resources 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
30 June 2015 and of its performance for each of the years ended on those dates
ii.
complying with Australian Accounting Standards and the Corporations Regulations 2001; and
b.
the financial report also complies with International Financial Reporting Standards as disclosed in
Note 1.
Emphasis of matter
Without qualifying our opinion, we draw attention to Note 1 in the financial report, which describes the
principal conditions that raise doubt about the consolidated entity’s ability to continue as a going concern.
These conditions indicate the existence of a material uncertainty that may cast significant doubt about the
consolidated entity’s ability to continue as a going concern and therefore, the consolidated entity may be
unable to realise its assets and discharge its liabilities in the normal course of business.
Report on the remuneration report
We have audited the Remuneration Report included the directors’ report for the year ended 30 June
2016. The directors of the company are responsible for the preparation and the 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 Bannerman Resources Limited for the year ended 30 June
2016, complies with section 300A of the Corporations Act 2001.
Ernst & Young
Robert A Kirkby
Partner
Perth
13 September 2016
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
RK:JH:Bannerman:034
ADDITIONAL SHAREHOLDER INFORMATION
FOR THE YEAR ENDED 30 JUNE 2016
ADDITIONAL SHAREHOLDER INFORMATION
Additional information required by the Australian Securities Exchange Listing Rules and not disclosed
elsewhere in this report is set out below. The information was applicable as at 29 September 2016.
Distribution of Equity Securities
There were 2,564 holders of less than a marketable parcel of ordinary shares. The number of shareholders by
size of holding is set out below:
Fully Paid Ordinary Shares
Size of Holding
Number of holders
Number of shares
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 and over
TOTALS
718
1,073
523
1,173
380
3,867
358,570
3,191,397
4,210,654
42,457,854
661,755,918
711,974,393
Unlisted Share options and Performance Rights
Share options
Number of
holders
-
Number of
share options
-
Performance Rights
Number of
holders
-
Number of
performance rights
-
-
-
-
5
5
-
-
-
40,014,400
40,014,400
-
-
1
12
13
-
-
30,265
20,555,393
20,585,658
Size of Holding
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 and over
TOTALS
Substantial Shareholders
An extract of the Company’s register of substantial shareholders (who held 5% or more of the issued capital) is
set out below:
Shareholder
Resource Capital Fund IV L.P. and Resource
Capital Fund VI L.P.
Clive Jones
Nathan McMahon
Number of
shares
Percentage
Held
268,524,434
77,207,668
61,712,267
37.7%
10.8%
8.67%
Date of last
lodgement
4 January 2016
31 December 2015
31 December 2015
Optionholders
An extract of the Company’s register of optionholders (who held 20% or more of the issued options not issued
under an employee incentive scheme) is set out below:
Shareholder
Brandon Munro
Number of options
20,000,000
Percentage Held
49.9%
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
77
ADDITIONAL SHAREHOLDER INFORMATION (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2016
Top 20 Shareholders
The top 20 largest shareholders are listed below:
Name
Merrill Lynch (Australia) Nominees Pty Limited
Mr Clive Jones
Kingsreef Pty Ltd
HSBC Custody Nominees (Australia) Limited
Mrs Alexandra Maidment Jubber
Citicorp Nominees Pty Limited
Widerange Corporation Pty Ltd
J P Morgan Nominees Australia Limited
Regent Pacific Group Ltd
HSBC Custody Nominees (Australia) Limited - A/C 3
Peter Batten
Motte & Bailey Pty Ltd
M & K Korkidas Pty Ltd
Mr Werner Ewald
Mr Feng Chen
Mr Mustafa Haddad
ABN Amro Clearing Sydney Nominees Pty Ltd
Dunco Pty Ltd
IJG Nominees Pty Ltd
Seven Four Seven Pty Ltd
TOTAL TOP 20 HOLDERS
TOTAL NON-TOP 20 HOLDERS
TOTAL
Voting Rights
Ordinary Shares
Number of
Shares
Percentage
Held %
272,525,358
61,712,267
61,712,267
23,774,107
19,150,315
16,892,593
15,495,401
13,400,222
10,854,568
9,000,002
5,206,940
4,948,112
4,447,467
3,444,663
3,382,008
3,224,527
3,003,333
3,000,704
2,602,751
2,120,000
539,925,605
172,048,788
711,974,393
38.28
8.67
8.67
3.34
2.69
2.37
2.18
1.88
1.52
1.26
0.73
0.69
0.69
0.48
0.48
0.45
0.42
0.42
0.37
0.30
75.83
24.17
100
For all ordinary shares, voting rights are on a show of hands whereby every member present in person or by
proxy shall have one vote and upon a poll, each share shall have one vote.
Share options and Performance Rights
There are no voting rights attached to share options and performance rights.
Stock Exchanges
Bannerman has a primary listing of its ordinary shares on the Australian Securities Exchange (ASX code: BMN)
and has an additional listing of its ordinary shares on the Namibian Stock Exchange (NSX code: BAN).
Mineral Licence Schedule
The mineral licence schedule for the Group is tabulated below:
Licence
Type/No.
Grant
Date
Expiry
Date
Holder
Area
(Ha)
Country in which the
Licence is held
EPL 3345 27-Apr-2006
26-Apr-2017
Bannerman Mining Resources
(Namibia) (Pty) Ltd
24,326
Namibia
BANNERMAN RESOURCES LIMITED
2016 ANNUAL REPORT
78
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