A
n
n
u
a
l
R
e
p
o
r
t
2
0
1
8
2018
Annual Report
Corporate Directory
Directors
Website
Bankers
Jeff Dowling – Chairman
www.batteryminerals.com
Westpac Banking Corporation
David Flanagan – Managing Director
Ivy Chen – Non Executive Director
Gilbert George – Non Executive Director
Paul Glasson – Non Executive Director
Brett Smith – Non Executive Director
Company Secretary
Tony Walsh
Nick Day
Registered Office
Share Registry
Automic Registry Services
Level 2, 267 St Georges Terrace,
Perth, Western Australia 6000
T: 1300 288 664
E: info@automic.com.au
W: www.automic.com.au
Level 13, 109 St Georges Terrace
Perth WA 6000
Solicitors
DLA Piper Australia
Level 31, Central Park
152-158 St Georges Terrace
Perth WA 6000
Auditors
KPMG
Stock Exchange
Australian Securities Exchange Limited
Ground Floor, 10 Ord Street
235 St. Georges Terrace
Level 40, Central Park
West Perth WA 6005
T: +61 8 6148 1000
Perth WA 6000
152-158 St George’s Terrace
Perth WA 6000
ASX Code: BAT
ABN 75 152 071 095
Contents
Executive Chairman’s Report
Operations Update
Financial Report
Corporate Governance Statement
ASX Information
2
6
23
82
83
1
2018 Annual Report Executive
Chairman’s Report
Dear Shareholder
The global energy and combustion engine vehicle markets across
The 2018 year was one in which your company remained focused
the world have entered a period of considerable disruption. There
on ticking all of the boxes as it advanced through key milestones
is significant optimism that low or no emission solutions are
towards graphite flake concentrate production - initially from its
a reality and importantly supported by large scale commercial
Montepuez graphite project. First shipment is due within ~15
production of lithium ion batteries.
months of concluding project finance.
This disruption is driving demand for minerals in a way that
delivers benefits to local communities, potentially very strong
returns for shareholders and rewarding places to work for
employees.
It is not possible to make lithium ion batteries without graphite.
The Montepuez graphite project is designed to operate at export
rates of ~50,000tpa at an average flake concentrate grade of over
96% TGC. Material highlights in 2018 included:
•
In late 2017 and early 2018, Battery Minerals signed
four offtake agreements for up to 41,000tpa of graphite
concentrate, representing ~82% of Montepuez’s forecast
Your company is advancing two outstanding projects in a region
annual production.
of Mozambique that currently hosts up to half the world’s known
•
In March 2018, the Mozambican Government granted
graphite resources. The Company’s deposits are also adjacent
Battery Minerals a Mining Licence and accepted the
to the world’s largest graphite mine. In 2019 Mozambique is set
Company’s Environmental Impact Assessment for the
to be the world’s largest exporter of graphite concentrates and is
Montepuez graphite project.
already cemented as a key contributor in the delivery of lithium
ion batteries for the world.
Yes, there are challenges in delivering a mine in a remote location
but it must be highlighted that it’s only in those remote under
explored areas that remarkable world-class giant discoveries can
be made.
During the last 12 months Battery Minerals Limited (“Battery
Minerals”) has continued to evolve into a world class ASX listed
graphite development company with two low cost high quality
graphite deposits in Mozambique, being Montepuez and Balama
Central.
•
In October 2018 Battery Minerals announced growth in its
Mineral Resource estimate from 105.9 million tonnes at
7.7% TGC to 119.6 million tonnes at 8.1% TGC, an increase
from 8.1 million tonnes to 9.7 million tonnes in contained
graphite.
•
In late November 2018 Battery Minerals completed its mine
implementation plan for its Montepuez graphite project
which gave the following material results:-
•
50 year mine life at a production rate of 50,000tpa at
96% TGC (average feed rate of 497,000tpa at ~11%
TGC)
•
•
•
Average C1 Cost for the first 10 years USD $361/t (FOB
Pemba)
Remaining project CAPEX USD $39.5M
Ore Reserves of 42.19 million tonnes at 9.27% TGC
• Waste to ore strip ratio 0.8
Your company is advancing two outstanding projects in a region
of Mozambique that currently hosts up to half the world’s
known graphite resources.
2
Battery Minerals Limited •
Completed construction of a permanent village with self-
In early 2018 Battery Minerals announced that the Board
contained accommodation for 100 people at the Montepuez
appointed two new Independent Non-Executive Directors, Mr.
graphite project.
•
Construction of a tailings dam wall designed to store tailings
and capture process water for ongoing operations at the
Montepuez graphite project.
Jeff Dowling and Ms. Ivy Chen as part of the Company’s ongoing
transition and rapid growth to become a graphite production
company. Mr. David Flanagan became Managing Director at that
time and Ms. Cherie Leeden stood down from the Board.
•
Civil works across site on roads and the plant site designed
Effective from 8 April 2019, as part of its strategy of building
to support stage 1 of operations at the Montepuez graphite
the operational and development capability in its Management
project.
•
•
Built and handed over a new school to our local community.
As part of project funding the Company also appointed
team, the Battery Minerals Board appointed experienced mining
operations executive Mr. Jeremy Sinclair as Managing Director &
CEO, and Mr. David Flanagan was appointed Executive Chairman.
advisory firm Origin Capital to manage the debt funding
After 7 years on the Board, Mr. Brett Smith and Mr. Gilbert
process. Independent technical and commodity market
George will stand down from the Board at the 2019 Annual
audit teams were commissioned to complete detailed
General Meeting. In addition, Mr. Jeff Dowling became the Lead
reviews for the benefit of lenders. The investigations
Independent Non-Executive Director on 8 April 2019. Battery
confirmed your Company has a reasonable basis in support
Minerals continues to have a majority of Independent Non-
of its development plans.
In December 2018 Battery Minerals announced a feasibility
study on its Balama Central project, which comprises a Stage
1 production rate of 58,000tpa (B1) which yielded the following
material results:-
27-year mine life at a product rate of 58,000tpa at 96% TGC
(average feed rate of 480,000tpa at ~12.5% TGC)
Average C1 Cost for the first 10 years USD $363/t (FOB
Pemba)
Executive Directors, with a Lead Independent Non-Executive
Director, another two Independent Non-Executive Directors and
two Executive Directors, being the Managing Director, Jeremy
Sinclair and Executive Chairman, David Flanagan. The Board
would like to thank Brett Smith and Gilbert George for their
service and input to the development of the Company.
The Board would like to thank staff and shareholders for their
continued support during the year and it looks forward to making
great steps to grow shareholder wealth through the development
of its two world class, low cost quartile graphite projects in
Project CAPEX USD $69.4M
Mozambique.
Ore Reserves of 19.66 million tonnes at 11.06% TGC
•
•
•
•
• Waste to ore strip ratio 2.0
As Battery Minerals executes subsequent expansions, subject to
the completion of all necessary studies, permits, construction,
financing arrangements, infrastructure access, it expects
Montepuez concentrate production output to grow to over
David Flanagan
Executive Chairman
100,000 tonnes per annum of graphite flake. When combined
with Balama Central and subject to continued positive economic,
social and technical investigations, Battery Minerals expects
its graphite concentrate production to grow to a rate to at least
150,000tpa at a grade of +96% TGC.
3
2018 Annual Report Operations
Update
First shipment is due within ~15 months of concluding project finance
4
Battery Minerals Limited Port allocation at Pemba Port for
100,000 tpa of graphite concentrate
5
2018 Annual Report Operations
Update
Executive Summary
Battery Minerals Limited (“Battery Minerals”) is an
Australian Securities Exchange (ASX) publicly listed
Australian company with two world-class graphite
deposits in Mozambique, being Montepuez and
Balama Central. Battery Minerals has produced
high quality graphite flake concentrate at multiple
laboratories. Subject to completing project financing,
Battery Minerals intends to commence graphite flake
concentrate production from its Montepuez Graphite
Project at rates of ~50,000tpa at an average flake
concentrate grade of 96% TGC.
In December 2017 and January 2018, Battery
Minerals signed four offtake agreements for up to
41,000tpa of graphite concentrate, representing 82% of
Montepuez’s forecast annual production. In H1 FY2018,
the Mozambican Government has granted Battery
Minerals a Mining Licence and it has also accepted the
Company’s Environmental Impact Assessment (EIA) for
the Montepuez Graphite Project.
As Battery Minerals executes subsequent expansions,
subject to the completion of all necessary studies,
permits, construction, financing arrangements,
infrastructure access, it expects production to grow
to over 100,000 tonnes per annum graphite flake
concentrate from its Montepuez Graphite Project.
In December 2018, Battery Minerals announced a
feasibility study on its Balama Central project, which
comprises a Stage 1 product rate of 58,000tpa of
96%TGC graphite flake.
Combined with Montepuez and subject to continued
positive economic, social and technical investigations,
Balama Central provides scope for self-funded growth
from a graphite flake ~50,000tpa production-rate to at
least 150,000tpa.
6
Battery Minerals Limited Montepuez
Balama Central
MOZAMBIQUE
CABO
DELGADO
INDIAN
OCEAN
50km
CABO
DELGADO
Meluco
Legend
Cities/towns
Major roads
Railways
Ports
Battery Minerals
Syrah Resources Ltd
Montepuez
Graphite Project
Montepuez
Ancuabe
Metuge
Pemba
Balama Central
Graphite Project
Namuno
Figure 1. Montepuez and Balama Graphite Projects in the
Province of Cabo Delgado in northern Mozambique.
Chiúre
Namapa
NAMPULA
NAMPULA
INDIAN
OCEAN
Mecúfi
2018 Annual Report 7
Operations
Update
Montepuez Graphite Project
Mozambique
Montepuez
Stage 1 Production
50ktpa
Opex
$360.9/t
50 year mine life at production rate of 50,000tpa at 96%
TGC (average feed rate of 497,000tpa at ~ 12% TGC)
Average C1 Cost for the first
10 years USD $360.9/t
Capex Remaining
$39.5M1
Project CAPEX remaining
USD $39.5M
Strip Ratio
0.8
Waste to ore strip
ratio 0.8
1. See ASX Announcement dated 4 December 2018 for full details.
8
Battery Minerals Limited Completed construction of a tailings dam wall designed
to store tailings and capture process water for ongoing
operations at the Montepuez Graphite Project
Montepuez Economics – CAPEX and OPEX December 2018
During the December 2018 Quarter, Battery Minerals announced a significant improvement in the Montepuez Graphite Project’s
economics. The total estimated pre-production establishment capital cost outstanding for the project is US$39.5M, including
contingency, and the average operating cost for the first 10 years is US$361/t (FOB Pemba) as detailed below:
CAPEX
Area
Process Plant and Power
Mining Equipment and Light Vehicles
Camp infrastructure and fit-out
Earthworks, Tailings Storage Facility and Water Storage
Buildings, officers and workshops
Owners costs
Pre-production Costs
Freight
Total
Total Capex
USD$
Spent to end of
Nov 2018 USD$
Remaining
Capex USD$
28,129,000
4,160,000
23,969,000
4,378,000
3,108,000
3,834,000
1,814,000
4,747,000
4,926,000
1,672,000
72,000
4,306,000
3,108,000
3,491,000
0
343,000
62,300
1,751,700
1,772,000
2,975,000
47,000
4,879,000
389,000
1,283,000
52,608,000
13,101,300
39,506,700
The average C1 operating cost summary (FOB Pemba) for the project for the first 10 years is detailed below:
OPEX for years 1 to 10
Mining
Processing
General and Administrative
Logistics
Maintenance
Total C1 cost (FOB Pemba)
Notes:
USD$ pa
USD$/t conc
5,129,000
5,692,000
2,545,000
3,082,000
1,532,000
17,980,000
102.9
114.3
30.7
51.1
61.9
360.9
1. Above table excludes Government Royalties.
2. Above table based on average blended ore of 50,000 tpa TGC production rate and ~1.4Mtpa mined and process run of mine (ROM) ore at an
average rate of ~500,000tpa at 12% TGC
9
2018 Annual Report Montepuez Mineral Resource - October 2018
During October 2018, the Company updated the Mineral Resource estimates that formed the basis of the Montepuez Graphite project
implementation mine plan.
Montepuez October 2018 Mineral Resource Estimate (2.5% TGC Cut-off)
Type
Weathered
Primary
Total
Total Mineral Resource
Tonnes
Mt
TGC
%
Cont. Graphite
kt
Oct 18
Historical
Oct 18
Historical
Oct 18
Historical
10.3
109.2
119.6
13.0
92.9
105.9
7.7
8.1
8.1
7.9
7.7
7.7
790
8,870
9,660
998
7,066
8,064
Note: See announcement dated 18 October 2018 for full details and Competent Persons sign-off
Montepuez Ore Reserve - December 2018
During December 2018, Battery Minerals announced a significant increase in Ore Reserves at its Montepuez Graphite Project in
Mozambique.
Montepuez Graphite Project November 2018 Ore Reserve Estimate
Deposit
Total
Ore type
Weathered
Fresh
Total
Class
Ore (Mt)
TGC (%)
Probable
Probable
Probable
5.98
36.21
42.19
8.34
9.42
9.27
Note: See announcement dated 4 December 2018 for full details and Competent Persons sign-off
Montepuez Graphite Project Flake Size Classification
The Ore Reserve update and associated mine plan has had a positive impact on the Montepuez flake size classification. This relates to
the inclusion of an increased quantity of fresh material, which contains a higher proportion of +150-micron flake.
The life of mine flake graphite concentrate sizing is summarised below:
Montepuez Graphite Project Life of Mine (LOM) Flake Size Distribution
Montepuez – LOM Flake Graphite Concentrate Sizing
Flake size
Jumbo
Large
Medium
Fine
Flake size
(mesh)
+50 Mesh
+80 Mesh
+100 Mesh
-100 Mesh
Flake size
(micron)
+300
+180 -300
+150 -180
0 - 150
% of
concentrate
TGC grade
11.0%
20.7%
11.3%
57.1%
96%
96%
96%
96%
Montepuez Graphite Project Average Product Flake Size Classification (Weathered & Fresh)
Flake size
Jumbo
Large
Medium
Fine
10
Flake size
(mesh)
+50 Mesh
+80 Mesh
Flake size
(micron)
+300
+180 -300
+100 Mesh
+150 -180
-100 Mesh
0 - 150
Weathered
Fresh
% in Interval
% in Interval
5.9
3.5
13.6
77.0
11.6
22.5
11.0
54.9
Battery Minerals Limited Montepuez Mining Agreement Progress
Montepuez Mine Layout and Design
In March 2018, Battery Minerals secured a Mining Licence for its
Pit designs were based on Whittle pit optimisations for each
Montepuez Graphite Project. This, combined with the successful
deposit considering project specific unit costs, prices, recoveries
$20M fund raising completed in early July 2018, paved the way
and geotechnical inputs. The pit optimisations were constrained
for significant development activity during H2 2018.
within the limits of the Measured and Indicated Resources for
During the year, Battery Minerals continued to progress
government engagement in relation to the Mining Agreement.
The Mining Agreement is not a condition precedent to production,
each deposit. The current design for the Buffalo pit extends to
a depth of approximately 132m, whilst the current design for
Elephant pit extends to a depth of approximately 135m.
exports and cashflows. The execution of a Mining Agreement
Each pit will have a single waste dump, located to the east of
is a right enshrined in the mining law that enables investing
each excavation. Pit ramps will be orientated to ensure that both
companies to obtain absolute clarity around the application of
ore and waste haulage distances are minimized. Long-term ore
the legal framework to the project. The Mining Agreement also
stockpiles will be located between each pit and the ROM pad.
formalises the project’s fiscal stability rights into a contractually
binding document and provides an agreed dispute resolution
process. The Company does not expect a material adverse
variation in project economics in the Mining Agreement.
Figure 2. Montepuez Graphite Project: Mine & Processing Site Layout.
11
2018 Annual Report Operations
Update
Balama Central Graphite Project
Mozambique
Balama
US$2,962M*
US$1,912M*
US$69.4M*
Life of Mine (LoM) sales
revenue (net)
LoM cash generation
Capex (pre-production)
for Stage 1
Battery Minerals expects to develop Balama
Central after the Montepuez Graphite Project
is commissioned
*. See ASX Announcement dated 12 December 2018 for full details.
12
Battery Minerals Limited Feasibility Study December 2018
In December 2018, Battery Minerals announced that a Feasibility Study had found that its second proposed graphite project in
Mozambique, Balama Central will generate outstanding financial returns over a 27-year mine life at a production rate of 58,000tpa **.
Key Balama Central Feasibility Study findings
Feasibility Study findings***
Ore processing rate
Concentrate production rate
Life of Mine (LoM) sales revenue (net)
LoM cash generation
480,000tpa @12.5%
58,000tpa @ 96%
US$2,962 million
US$1,912 million*
Average EBITDA at BMI pricing****
+US$35M per annum
Project pre-tax IRR
Project payback period
Capex (pre-production)
55%
2.3 years
US$69.4 million
C1 LoM operating cash cost
US$425/t of product (FOB Pemba)
First 8 years C1 operating cash cost
US$363/t of product (FOB Pemba)
Waste to ore strip ratio
2.0
*- Excludes National Ownership (anticipated to be ~5%) and 32% tax rate and royalties
**- Based on Ore Reserves (see ASX released dated December 2018)
***- Feasibility Study findings (+15%/-5%) as at 12 Decemeber 2018
****- Based on the latest BMI CIF China forecast graphite prices for 2022
Montepuez Graphite Project
Ancuabe
Pemba
Montepuez
Balama
H i g h w a y A l l Weather R
o
a
d
Syrah Resources Ltd
Balama Graphite Project
MAP AREA
Pemba
MOZAMBIQUE
Product Tested Route
Sealed Road
Unsealed Road
50 kilometres
MAPUTO
Figure 3. Infrastructure map showing the Balama Central Graphite Project relative to Montepuez and the nearest deep-water port of Pemba
13
2018 Annual Report Balama Central Graphite Project: Mineral Resource Estimate March 2018
Type
Weathered
Primary
Total
Total Mineral Resource
Tonnage
Mt
TGC
%
Cont. Graphite
Kt
7.4
25.6
33.0
10.7
10.1
10.2
790
2,573
3,363
Note: See announcement dated 18 October 2018 for full details and Competent Persons sign-off
Balama Central Graphite Project: Ore Reserve Estimate December 2018
Pit
Total
Ore type
Class
Ore (Mt)
TGC (%)
Weathered
Fresh
Total
Probable
Probable
Probable
5.44
14.21
19.66
10.74
11.19
11.06
Note: See announcement dated 12 December 2018 for full details and Competent Persons sign-off
Balama Central Graphite Project economics – CAPEX and OPEX December 2018
Balama Central Capex
Process Plant
Non-Process Infrastructure
Mining
EPCM
Owner's Costs
Resettlement Action Plan (RAP)
Non-Mining Mobile Fleet
TSF and Bulk Water Storage
Freight
Contingency
Total
USD
20,893,575
7,709,246
8,171,160
3,200,000
9,221,324
4,132,600
1,939,648
6,838,080
1,786,170
5,534,083
69,425,887
The Weathered Ore and Fresh Ore C1 operating cost summaries (average blended ore):
COST
US$/y
COST
US$/t feed
COST
US$/t product
Distribution
3,260,031
3,782,923
3,720,950
615,404
1,941,712
3,914,138
3,215,479
6.79
7.88
7.75
1.28
4.05
8.15
6.56
56.09
65.08
64.02
10.59
33.41
67.34
55.32
15.9%
18.5%
18.2%
3.0%
9.5%
19.1%
15.7%
20,450,636
42.06
351.84
100.0%
Weathered Ore OPEX
Category
Labour
Power
Reagents & Consumables
Maintenance Materials
G&A
Product Logistics
Mining and Earthworks
Total C1 Cost
14
Battery Minerals Limited Fresh Ore OPEX
Category
Labour
Power
Reagents & Consumables
Maintenance Materials
G&A
Product Logistics
Mining and Earthworks
Total C1 Cost
Notes:
COST
US$/y
COST
US$/t feed
COST
US$/t product
Distribution
3,260,031
3,782,923
3,720,950
615,404
1,941,712
3,914,138
5,369,661
22,604,817
6.79
7.88
7.75
1.28
4.05
8.15
11.19
47.09
56.09
65.08
64.02
10.59
33.41
67.34
107.96
404.48
13.9%
16.1%
15.8%
2.6%
8.3%
16.6%
26.7%
100.0%
1. Above two OPEX tables excludes Government Royalties.
2. Above tables based on average blended ore of 58,000 tpa TGC production rate and ~1.7Mtpa mined and process run of mine (ROM) ore at an
average rate of ~480,000tpa at 12.5% TGC
Balama Central Mine layout and design
Mining at Balama Central will be completed with standard truck and excavator methods. Drill and blast of the fresh material will be
required.
Pit designs for the Lennox and Byron deposits were based on Whittle pit optimisations for each deposit considering project specific unit
costs, prices, recoveries and geotechnical inputs. The pit optimisations were constrained within the limits of the Indicated Resources
for each deposit. The current design for the Lennox pit extends to a depth of approximately 90m, whilst the current design for Byron
pit extends to a depth of approximately 135m deep. Each pit will have a single waste dump, located to the east of each excavation. Pit
ramps will be oriented to ensure that both ore and waste haulage distances are minimized. Long-term ore stockpiles will be located
between each pit and the ROM pad. The project layout is shown in figure 4 below.
Figure 4. Balama Central Graphite Project: Mine & Processing Site Layout.
15
2018 Annual Report Battery Minerals - Group Mineral Resource Statement
Battery Minerals Group MRE
Group Mineral Resource Estimate (2.5% - Montepuez 6% - Balama TGC Cut-off)
Group Total Mineral Resource - Weathered
Project
Montepuez
Balama Central
Total
Project
Montepuez
Balama Central
Total
Project
Montepuez
Balama Central
Total
Deposit
Elephant
Buffalo
Lennox
Byron
Deposit
Elephant
Buffalo
Lennox
Byron
Deposit
Elephant
Buffalo
Lennox
Byron
Tonnes
Mt
6.6
3.7
4.8
2.6
17.7
TGC
%
7.0
8.7
10.9
10.4
8.9
Group Total Mineral Resource - Primary
Tonnes
Mt
70.3
38.9
17.2
8.4
134.8
TGC
%
7.3
9.6
10.0
10.2
8.5
Group Total Mineral Resource
Tonnes
Mt
76.9
42.6
21.9
11.0
152.5
TGC
%
7.3
9.5
10.2
10.2
8.5
Cont. Graphite
kt
460
330
520
270
1,580
Cont. Graphite
kt
5,150
3,720
1,720
850
11,440
Cont. Graphite
kt
5,620
4,050
2,230
1,120
13,030
Note: See announcement dated 18 October 2018 for full details and Competent Persons sign-off
Battery Minerals - Group Ore Reserve Statement
Battery Minerals Group Probable Ore Reserves
Project
Balama 1
Montepuez 2
Total
Notes:
Mt
19.66
42.19
61.9
Grade % TGC
Contained Graphite Mt
11.06
9.27
10.1
2.17
3.91
6.08
1. See announcement dated 4 December 2018 for full details and Competent Persons sign-off
2. See announcement dated 12 December 2018 for full details and Competent Persons sign-off
16
Battery Minerals Limited 17
2018 Annual Report Community
In 2018 the project completed the construction of
a Primary School in the village of Nquewene, which
provides education for two terms of 350 pupils. The
school has two classrooms, a principal’s office, teachers
offices and a library alongside sanitation facilities. Work
also began on making school furniture crafted from
local resources and using local artisans in the form of
seats and benches. Support was provided to assess
the local health clinic through the provision of beds,
sheets blankets and pillows for the in-patient facilities,
furniture for the consultation rooms and the painting of
the buildings.
To support health service outreach programs, the
company repaired the health centre’s ambulance,
provided spare parts and supplied fuel for the running
of the patient care service. With the objective of
reducing water-borne diseases the company supplied
3 boreholes for the immediate community, providing
safe water for 12,500 people. To promote sport in the
area, the company provided uniforms and balls for
several local soccer teams and supported events which
promote local culture and crafts.
Battery Minerals funds
school development
to help children gain a
better education.
18
Battery Minerals Limited 2018 Annual Report 19
Graphite
End Uses
Electric Vehicles
Lubricants
Steel, Foundries &
Refractories
Lithium-ion Batteries
20
Poised to become a key natural graphite supplier
to the booming battery sector, with construction
underway at its Montepuez Graphite Project in
Mozambique.
Battery Minerals Limited What is
Graphite?
Graphite is a soft, black, hexagonal
crystalline form of pure carbon. It is
formed in thin plates and typically
found in metamorphic rocks.
Graphite’s exceptional versatility,
electrical and thermochemical
properties makes it an ideal material
for use in making lubricants,
electrodes, battery anodes, nuclear
applications, refractory and as a fire
retardant.
Graphite is an essential
component of
lithium-ion batteries
Composition of a 62kWh Lithium-ion battery
Aluminum
Cathode (+)
Li, Ni, Mn, Co
+ others
~
60kg (combined)
Separator
Electrolyte
Anode (-)
Copper
Graphite
75kg
~
2018 Annual Report 21
22
Battery Minerals Limited Financial
Report
Contents
Directors’ Report
Auditor’s Independence Declaration
Independent Auditor’s Report
Consolidated Statement of Profit or Loss
and Other Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Cash Flows
Consolidated Statement of Changes in Equity
24
42
43
48
49
50
51
Notes to the Consolidated Financial Statements
52
Directors’ Declaration
81
23
2018 Annual Report Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Directors’ Report
Directors’ Report
The Board of Directors present the following report on Battery Minerals Limited and its controlled entities (referred to
hereafter as “the Group”) for the year ended 31 December 2018.
Directors
The names of the Directors in office during the financial year and until the date of this report are as follows. All Directors
were in office for the entire period unless otherwise stated:
Position
Non-Executive Chairman
Managing Director
Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Appointed
25 January 2018
11 October 2016
19 July 2013
1 August 2012
1 August 2012
19 April 2017
25 January 2018
Resigned
-
-
25 January 2018
-
-
-
-
Director
Jeff Dowling
David Flanagan
Cherie Leeden
Gilbert George
Brett Smith
Paul Glasson
Ivy Chen
Dividends
No dividends were paid during the year (31 December 2017: Nil).
Principal Activities
Battery Minerals Limited, an ASX listed company (ASX:BAT) is a diversified mining development and minerals exploration
company dedicated to exploring for and developing mineral deposits in Mozambique. The Company is maintaining a focus
on its two graphite projects Montepuez and Balama which are located in Mozambique.
Review of Operations
a. Group Overview
The Company’s strategy is to produce high-quality graphite flake, a crucial ingredient in the efficient operation of lithium-
ion batteries. Subject to completing project financing for the Montepuez Graphite Project in Mozambique, the company
initially expects to produce 50,000tpa of 96% TGC and grow production towards over 200,000tpa over the next five years.
b. Highlights & Significant Changes in State of Affairs
Offtake: In January 2018, three binding offtake agreements were signed with Guangxing Electronic Materials (GEM), Keshou
and Black Dragon for 10,000tpa each.
Placement: A $20m fund raising was successfully completed in January 2018.
Scoping Study: The Balama Scoping Study was successfully completed and announced on 1 March 2018.
Mining Licence: The Company’s Mining Licence for the Montepuez Project was granted in March 2018.
Increase in the Mineral Resource at Balama Central Graphite Project in Mozambique: Resource at the Balama Central
Graphite Project doubled to 32.9 million tonnes at 10.2% TGC following 1,600m of diamond drilling.
Placement: During June 2018 Quarter, the Company completed a $20.7 million fund raising.
Montepuez Graphite Project Resource Update: Battery Minerals’ grade control drilling programme at the Buffalo deposit
at Montepuez increased the Resource base and confidence levels at the Buffalo Deposit. The Group mineral Resource in
24
Page 2
Battery Minerals Limited Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Directors’ Report (continued)
Directors’ Report (continued)
October 2018 increased to 152.5mt @ 8.5% for 13.03mt 1 of contained Graphite (Montepuez and Balama Central Projects).
The Montepuez Project Mineral Resources increased to 119.6mt @ 8.1% TGC0F.
Camp, Tailings and Earthworks Completed: Construction and commissioning of the permanent 100-person
accommodation camp; Tailing Storage Facility; and earth works for the processing plant were completed during in the last
quarter of 2018.
Updated Resources, Reserves and Mining Plan for Montepuez Graphite Project: During the December 2018 Quarter
Company announced a significant increase in the Montepuez Ore Reserve estimate 1F to 42.2Mt at 9.3% TGC. The Company
also noted a significant improvement in the Montepuez Graphite Project’s economics during the quarter. The total
estimated pre-production establishment capital cost outstanding for the project is US$39.5M, including contingency, and
the average operating cost for the first 10 years is US$361/t (FOB Pemba).
Balama Central Feasibility Study completed: During the December 2018 Quarter, the Company announced a positive
Feasibility Study for its second proposed graphite project in Mozambique, Balama Central with a 27-year mine life at a
production rate of 58,000tpa. The initial Ore Reserve estimate was announced at 19.7Mt at 11.1% TGC, average C1
Operating Cost for the first 8 years of US$363/t and a Project CAPEX of US$69.4M.
Likely Developments and Expected Results
The Group will continue to focus on its strategic plan to develop and bring the Montepuez Graphite Project and Balama
Graphite Project successfully into commercial production. This involves securing the funding in the form of debt and equity
to complete the development and achieve production of its flake graphite concentrate. The Company continues to build its
operational and administrative capability, systems and processes working towards becoming a successful production
company in the graphite market.
The Group’s long-term strategic objective is to develop its projects, grow production to 200,000 tonnes of graphite
concentrate per annum, ensure all activities are carried out in a transparent and responsible way contribute to the well-
being of local communities, in addition to increasing shareholders’ value.
Risk Management
The Board is responsible for ensuring that risks, and opportunities, are identified on a timely basis and that activities are
aligned with these risks and opportunities. The Company believes that it is crucial for all Board members to be a part of this
process, and as such the Board has not established a separate risk management committee. The Board has a number of
mechanisms in place to ensure that management’s objectives and activities are aligned with the risks identified by the
Board. These include the following:
•
•
Board approval of a strategic plan, which encompasses strategy statements designed to meet stakeholders’
needs and manage business risk.
Implementation of Board approved operating plans and budgets and Board monitoring of progress against these
budgets.
Environmental Regulation
The Group is subject to significant environmental regulation in respect of mineral exploration activities. The Group operates
within the resources sector and conducts its business activities with respect for the environment while continuing to meet
the expectations of the shareholders, employees and suppliers. The Group’s exploration activities are currently regulated
by significant environmental regulation under the laws of Mozambique. The Group aims to ensure that the highest standard
of environmental care is achieved, and that it complies with all relevant environmental legislation.
The Directors are mindful of the regulatory regime in relation to the impact of the organisational activities on the
environment. There have been no known breaches by the Group during the year.
After Reporting Date Events
There are no events after the end of the Reporting Period to disclose.
Page 3
25
2018 Annual Report
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Directors’ Report (continued)
Directors’ Report (continued)
Information on Directors
Jeff Dowling
(appointed 25 January 2018)
Qualifications
Experience
Current Directorships
Former directorships in last 3
years
David Flanagan
(appointed 11 October 2016)
Qualifications
Experience
Non-Executive Chairman
Bachelor of Commerce from the University of Western Australia and is a fellow of the Institute of
Chartered Accountants, the Australian Institute of Company Directors and the Financial Services
Institute of Australasia
Jeff is a proficient corporate leader with 37 years’ experience in the professional services with Ernst
& Young. Jeff has held numerous leadership roles within Ernst & Young including at national level
being a member of the executive management team and a Board Member. Jeff’s professional
expertise centres around audit, risk and financial acumen derived from acting as lead partner on large
public company audits, capital raisings and corporate transactions principally in the resources, retail
and insurance industries. Jeff’s career with Ernst & Young culminated in his appointment as
Managing Partner of the Ernst & Young Western Region for a period of 5 years. Jeff also led Ernst &
Young’s Oceania China Business Group and was responsible for building Ernst & Young’s Oceania
relationships with Chinese Corporations.
Non-Executive Chairman, S2 Resources Limited
Non-Executive Director, NRW Holdings Limited
Non-Executive Director, Fleetwood Corporation Ltd
Chairman, Sirius Resources NL (Resigned 23 September 2015)
Chairman, Pura Vida Energy NL (Resigned 16 May 2016)
Non-Executive Director, Atlas Iron Limited (Resigned 4 May 2016)
Managing Director
BSc, WASM, MAusIMM, FAICD
Mr Flanagan is a geologist with more than 25 years' experience in the mining and mineral exploration
industry in Australia, Indonesia and Africa. Mr Flanagan was the founding Managing Director at Atlas
Iron. During his tenure at Atlas Iron he oversaw its growth from a junior exploration company, to an
ASX top 100 listed iron ore exporter, and the operator of three iron mines producing at a rate of
12Mtpa.
Mr Flanagan is the Chancellor of Murdoch University, and during 2014 was named Western
Australian of the Year. He was awarded an Eisenhower Fellowship in 2013 and remains active in the
not for profit sector. In January 2018, David was awarded the prestigious Member of the General
Division of the Order of Australia Award
Current Directorships
Former directorships in last 3
years
nil
Non-Executive Chairman, Atlas Iron Limited (Resigned 11 June 2015)
Managing Director, Atlas Iron Limited (Resigned 28 June 2016)
Non-Executive Director, Northern Star Resources Limited (Resigned 20 April 2018)
Cherie Leeden
(appointed 19 July 2013)
(resigned 25 January 2018)
Qualifications
Experience
Executive Director – Technology and Business Development
BSc Applied Geology (Hons)
Ms Leeden is a member of the Australian Institute of Geoscientists. Ms Leeden has been involved in
mining and exploration for the past 15 years and was responsible for pegging the Company's
Montepuez graphite project in Mozambique. Ms Leeden has developed significant knowledge in the
last four years in the battery minerals space.
Current Directorships
Former directorships in last 3
years
Nil
Nil
26
Page 4
Battery Minerals Limited
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Directors’ Report (continued)
Directors’ Report (continued)
Information on Directors (cont’d)
Gilbert George
(appointed 1 August 2012)
Qualifications
Experience
Current directorships
Former directorships in last 3
years
Brett Smith
(appointed 1 August 2012)
Qualifications
Experience
Current Directorships
Non-Executive Director (previously Non-Executive Chairman up to 11 October 2016)
BSc (Hons) MEc
Gilbert has a wide range of experience in international business development and management.
Formerly a senior bilingual Australian embassy official in Tokyo he continues to provide strategic advice
to companies in Australia, Africa, Japan, the US and Europe. He has been involved in over $950 million
of new investment in Australia including in the resource industry, IT, food processing and service
sectors. His resource experience includes coal, iron ore, gold, uranium, oil and heavy mineral sands. He
was formerly a director of Tokyo Gas Australia Pty Ltd and TEPCO Australia.
Mr George also has strong cultural interests, particularly in music education
Nil
Nil
Non-Executive Director
BSc (Hons), MAUSIMM MAIG
Brett Smith has acquired over 20+ years of experience in the mining and exploration industry as a
geologist, manager, consultant and director. His industry experience is broad, dominated by
exploration and resource definition.
Managing Director, Corazon Mining Limited
Former directorships in last 3
years
Executive Director, Cauldron Energy Limited (Resigned 23 June 2015)
Non-Executive Director, Pacific Bauxite Limited (Resigned 29 November 2018)
Paul Glasson
(appointed 19 April 2017)
Qualifications
Experience
Current Directorships
Former directorships in last 3
years
Non-Executive Director
BSc La Trobe University, Melbourne, Australia
Mr Glasson is a highly regarded China strategy specialist. He has lived in Shanghai for the past 20 years
and is currently Executive Chairman of Satori Investments, a China focused investment advisory and
private equity firm. He is a Life Member of the Australia China Business Council. Paul is well known as
a foremost expert on Chinese outbound investment, having been recognised with Deal of the Year by
Mines and Money in 2014 for his origination and lead on the Baosteel-Aurizon on-market hostile
takeover of Aquila, as well as being Young Leader of Asia by the Boao Forum for three years. He was
also the Australia China Business Council’s key proponent in engaging with key Chinese government
and enterprise from 2008-2014
Nil
Nil
Page 5
27
2018 Annual Report
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Directors’ Report (continued)
Directors’ Report (continued)
Information on Directors (cont’d)
Ivy Chen
(appointed 25 January 2018)
Qualifications
Experience
Current Directorships
Former directorships in last 3
years
Director Meetings
Non-Executive Director
B.App.Sc (Geology), MAusIMM GAICD
Ivy is a corporate governance specialist with more than 30 years’ experience in mining and resource
estimation. She served as the national geology and mining adviser for the Australian Securities and
Investments Commission (ASIC) from 2009-2015 and is currently Principal Consultant at CSA Global. Ivy’s
experience in the mining industry in Australia and China, as an operations and consulting geologist
includes open pit and underground mines for gold, manganese and chromite. As a consulting geologist
she has conducted mineral project evaluation, strategy and development and implementation, through
to senior corporate management roles. Ivy has been a member of the VALMIN committee since 2015.
Nil
Nil
The number of Directors’ meetings and number of meetings attended by each of the Directors of the Group during the
year:
Number of Meetings Eligible
to Attend
Number of Meetings
Directors’ attended
Director
Mr David Flanagan
Mr Gilbert George
Mr Brett Smith
Mr Paul Glasson
Mr Jeff Dowling
Ms Ivy Chen
10
10
10
10
10
10
10
9
9
8
10
10
Retirement, election and continuation in office of directors
In accordance with the Constitution, the appropriate directors will retire at the annual general meeting and, being eligible,
offer themselves for re‑election. Directors Gilbert George and Brett Smith have advised the Company that they will be
retiring at the next general meeting as announced on 14 March 2019.
Company Secretary
Mr Tony Walsh was appointed as Joint Company Secretary on 17 February 2017. Tony Walsh has over 30 years’ experience
in dealing with listed companies, ASX, ASIC and corporate transactions including 14 years with the ASX in Perth where he
acted as ASX liaison with the JORC committee, four years as Chairman of an ASX listed mining explorer and as a director of
a London AIM listed explorer. Tony is also currently Company Secretary of Legend Mining Ltd (ASX: LEG). Tony is a member
of the Australian Institute of Company Directors, a Fellow of the Governance Institute of Australia, the Institute of Chartered
Secretaries and the Institute of Chartered Accountants in Australia.
Mr Nick Day was appointed as Joint Company Secretary on 8 October 2018. Nick Day has over 20 years of experience as a
company director, CFO and company secretary for a broad range of listed and private technology companies and mining
and exploration companies. These have included ASX and TSX listed exploration companies with copper, gold, lead, coal,
zinc, rare earths and uranium projects in Madagascar, the Philippines and North/South America, nano-technology and e-
book IT companies to $600 million nickel/platinum AIM and ASX listed exploration and mining operations across six
countries in Africa. He has extensive experience in Africa and Asia with strategic planning, business development, mergers
and acquisitions, bankable feasibility studies, debt raising and project development.
Mr Jeff Dawkins, BCom. CA, resigned as Joint Company Secretary on 8 October 2018.
28
Page 6
Battery Minerals Limited
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Directors’ Report (continued)
Directors’ Report (continued)
Financial Performance and Financial Position
Financial Performance / Position
Cash and cash equivalents
Net assets
Revenue
Loss for the period
Loss per share
31-Dec-18
$
31-Dec-17
$
Change
%
7,252,709
44,644,651
33,969
(7,243,165)
(0.763)
7,723,112
17,846,393
-
(5,822,651)
(1.330)
-6%
150%
N/A
24%
-43%
The financial result for the year ended 31 December 2018 is a loss for the period after tax of $7,243,165 (2017: $5,822,651).
The net assets of the Group have increased from $17,846,393 as at 31 December 2017 to $44,644,650 as at 31 December
2018 due to the capitalised exploration and evaluation and mine development expenditure incurred during the financial
year. The Group’s working capital (current assets less current liabilities) has reduced marginally from $6,806,911 as at 31
December 2017 to $6,638,314 as at 31 December2018, primarily due to share placements in January and May 2018 and
effective cost control during the year.
Shares under Option and Performance Rights
Unissued ordinary shares of Battery Minerals Limited under options as at 31 December 2018 are summarised as follows:
•
•
•
•
Directors – 69,900,000,
Employees – 52,125,000,
Service Providers – 15,600,000
Shareholders – 170,699,066
Shares Issued on the Exercise of Options or Performance Rights
3,500,000 performance rights were converted to ordinary shares upon their vesting on 28 March 2018.
Insurance of Directors and Officers Liability
The Group has executed a policy with an appropriate level of directors’ and officers’ insurance cover and paid a premium
of $21,000 during the financial year.
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 them or someone else or to cause detriment to the Group.
Indemnity and Insurance of Auditors
The Company has not, during or since the financial year, indemnified or agreed to indemnify the auditor of the Company
or any related entity against a liability incurred by the auditor.
During the financial year, the Company has not paid a premium in respect of a contract to insure the auditor of the Company
or any related entity.
Non-Audit Services
Details of the amounts paid or payable to the auditor for non-audit services provided during the financial year by the auditor
are outlined in Note 21 to the financial statements. The Directors are satisfied that the provision of non-audit services
during the financial year, by the auditor (or by another person or firm on the auditor’s behalf), is compatible with the
general standard of independence for auditors imposed by the Corporations Act 2001. The Directors are of the opinion that
the services as disclosed in Note 21 to the financial statements do not compromise the external auditor’s independence.
Page 7
29
2018 Annual Report
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Directors’ Report (continued)
Directors’ Report (continued)
Proceedings on Behalf of the Group
No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings on behalf
of the Group, or to intervene in any proceedings to which the Group is a party, for the purpose of taking responsibility on
behalf of the Group for all or part of those proceedings.
No proceedings have been brought or intervened in on behalf of the Group with leave of the Court under section 237 of
the Corporations Act 2001.
Audited Remuneration Report
This report for the year ended 31 December 2018 outlines the remuneration arrangements of the Group in accordance
with the requirements of the Corporations Act 2001 (‘the Act’) and its regulations. This information has been audited as
required by section 308(3C) of the Act.
The remuneration report details the remuneration arrangements for Directors and Key Management Personnel (‘KMP’)
who are defined as those persons having authority and responsibility for planning, directing and controlling the major
activities of the Group, directly or indirectly, including any Director (whether executive or otherwise) of the Parent
company.
The remuneration report is set out under the following main headings:
A
B
C
D
E
F
Principles used to determine the nature and amount of remuneration
Details of remuneration
Service agreements
Share-based compensation
Director share and option holdings
Additional information
The names of the Directors and Key Management Personnel in office during the period are as follows:
Director
Jeff Dowling
David Flanagan
Cherie Leeden
Gilbert George
Brett Smith
Paul Glasson
Ivy Chen
KMP
Nick Day
Tony Walsh
Ben Van Roon
Jeff Dawkins
Andy Cardoso
Position
Non-Executive Chairman
Managing Director
Non-Executive Chairman
Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Position
CFO and Company Secretary
Company Secretary
Chief Operating Officer
CFO and Company Secretary
Project Director
Appointed
25 January 2018
29 March 2017
11 October 2016
19 July 2013
1 August 2012
1 August 2012
19 April 2017
25 January 2018
Appointed
8 October 2018
17 February 2017
11 August 2017
18 December 2017
6 April 2017
Resigned
-
-
29 March 2017
25 January 2018
-
-
-
-
Resigned
-
-
-
8 October 2018
30 June 2018
A Principles Used to Determine the Nature and Amount of Remuneration
(i) Board Oversight
For 2018, the Board elected not to establish a remuneration committee based on the size of the organisation and had
instead agreed to meet as deemed necessary and allocate the appropriate time at its board meetings.
30
Page 8
Battery Minerals Limited
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Directors’ Report (continued)
Directors’ Report (continued)
Audited Remuneration Report (continued)
The following items are considered and discussed as deemed necessary at the board meetings:
▪
▪
▪
▪
▪
▪
▪
The remuneration of Directors, senior officers and general staff;
The terms and conditions of employment for the Managing Director;
Review of the Managing Director’s performance, at least annually, including setting the Managing Director’s
goals for the coming year and reviewing progress in achieving those goals;
The recommendations of the Managing Director for the remuneration of all direct reports;
Board structure and Director evaluation;
Consideration of Non-Executive Directors remuneration.
Ensuring that remuneration policies and structures are fair and competitive and aligned with the long-term
interests of the Company.
(ii) Remuneration Philosophy
The Company’s current remuneration policy is based on its status as a junior mineral resources company. The entity’s
performance is dependent upon its exploration, project evaluation and project development successes, and as such
remuneration is maintained at a reasonable level to enable the attraction of key employees.
The Company’s broad remuneration strategy is to ensure the remuneration package properly reflects the person’s
duties and responsibilities and that remuneration is competitive in attracting, retaining and motivating people of the
highest quality.
To ensure the maximum amount of the Company’s capital where possible is directed toward its exploration, project
evaluation and project development activities, the Company issues options as a “non-cash” method of remunerating
and incentivising Directors and Key Management Personal to align their goals with the Company and its shareholders.
(iii) Non-Executive Directors
a)
Fees and Payments
Fees and payments to Non
the directors. Non
determined independently to the fees of non
Executive Directors reflect the demands which are made on, and the responsibilities of,
Executive Directors’ fees and payments are reviewed annually by the Board. The Chair’s fees are
executive directors based on comparative roles in the external market.
‑
‑
New Non-Executive Directors have up to the date of this report, been offered, subject to shareholder approval, “sign-
on” out of the money incentive options with the objective of ensuring director goals are aligned with the Company
and its shareholders. The vesting of the options issued are subject to minimum service periods of up to 12 months.
‑
b)
Base Fees
The current base fees paid to Non-Executive Directors were last reviewed with effect from 6 February 2015. Prior to
this they were based on rates set at the listing of the Company on the ASX, being 24 October 2012. No remuneration
is performance based. The Directors’ share and option holdings ensure that their goals are aligned with the
Company’s share price.
Non‑Executive Directors’ fees are determined within an aggregate Directors’ fee pool limit, which is periodically
recommended for approval by shareholders. The Directors’ fee pool will be reviewed for adequacy periodically.
The maximum currently stands at $500,000 cash remuneration per annum and was approved by shareholders via
the adoption of a revised constitution at a general meeting of shareholders on 6 July 2012.
Page 9
31
2018 Annual Report
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Directors’ Report (continued)
Directors’ Report (continued)
Audited Remuneration Report (continued)
c)
Options
Issue of options to Non-Executive Directors as part of their overall remuneration package is subject to shareholder
approval. Options granted to Non-Executive Directors are linked to continuous service as a Non-Executive Director
with the Company.
d)
Additional Fees
A Non-Executive Director may also be paid fees or other amounts as the Directors determine if a Director performs
special duties or otherwise performs services outside the scope of the ordinary duties of a Director and are based
on commercial rates.
A Non-Executive Director may also be reimbursed for out of pocket expenses incurred as a result of their directorship
or any special duties.
e)
Retirement Allowances for Directors
Current base fees are inclusive of superannuation contributions. Superannuation contributions required under the
Australian Superannuation Guarantee Legislation will be made as part of the directors’ overall fee entitlements
where applicable. No other retirement allowances are paid.
f)
Transition from Explorer to Development Company Through to Production Company and Director Remuneration
The Company expects to evolve from exploration and project evaluation to project development company, through
to production company.
With this evolution, the Board believes that the Company’s remuneration policies and procedures for director
remuneration will also evolve to a more traditional corporate governance model and in line with ASX Corporate
Governance guidelines.
iv)
Executive Remuneration
The nature and amount of remuneration of Executives are assessed on a periodic basis with the overall objective of
ensuring maximum stakeholder benefit from the retention of a high performing Executives.
In determining Executive remuneration, the Board aims to ensure that remuneration practices are:
▪
competitive and reasonable, enabling the Company to attract and retain key talent;
▪
aligned to the Company’s strategic and business objectives and the creation of shareholder value;
▪
transparent; and
▪
acceptable to shareholders.
Given the current phase of the Company’s development the Board does not consider earnings during the current
and previous financial years when determining, and in relation to, the nature and amount of remuneration of
Executives.
The Executive remuneration framework has two components:
▪
▪
Base pay and benefits, including superannuation; and
Equity incentives.
Base Pay
Base Pay consists of base salaries, as well as employer contributions to superannuation funds. Base Pay is reviewed
annually by the Board. The process consists of a review of Company and individual performance, relevant
comparative remuneration externally and internally and, where appropriate, external advice on policies and
practices. No external remuneration consultants were used during the financial year.
Page 10
32
Battery Minerals Limited
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Directors’ Report (continued)
Directors’ Report (continued)
Audited Remuneration Report (continued)
The Company does not currently have a short-term incentive plan in place.
Performance Based Remuneration - Equity Incentives Scheme
The Company has adopted an Employee Share Option Plan (“ESOP”) to reward KMP and key employees and
contractors for long-term performance. The maximum number of securities that can be issued under the ESOP plan
is 5% of the Company’s Issued Shares.
To achieve its corporate objectives the Company needs to attract and retain its key staff, whether employees or
contractors. Grants made to eligible participants under the ESOP will assist with the Company's employment strategy
and will:
a)
b)
c)
d)
enable the Company to recruit, incentivise and retain KMP and other eligible employees to assist with the
development of the Montepuez Project to achieve the Company’s strategic objectives;
link the reward of eligible employees with the achievements of strategic goals and the long-term performance
of the Company;
align the financial interests of eligible participants of the proposed Plan with those of Shareholders; and
provide incentives to eligible employees of the ESOP to focus on superior performance that creates
shareholder value.
Employee Options granted under the ESOP to eligible participants will be linked to the achievement by the Company
of certain performance conditions as determined by the Board from time to time. These performance conditions
must be satisfied in order for the employee Options to vest - current employee performance conditions are noted
in section C below. The employee Options also vest where there is a change of control of the Company.
In determining the allocations of equity, the Board considers relevant comparative allocations of equity externally
and internally. An independent remuneration consultant was not required to assist with the allocations of equity
given the Boards current industry knowledge and experience with allocations of equity.
Currently Executives have received “sign-on” incentive options which include time based and performance based
vesting conditions and zero exercise priced options which include only performance based vesting conditions
incentivising executives to meet the Company’s objectives of developing stages 1 and 2 of the Company’s
Montepuez graphite project. These options ensure executive goals are aligned with the Company and its
shareholders as its transitions through development to steady state production.
On 27 June 2018 the Board approved the issue of zero exercise priced options (ZEPOs) to Executives and staff with
specific vesting hurdles being:
▪
50% vest only on the commencement of commercial production for Stage 1 at the Montepuez Graphite
Project and
50% vest only on the commencement of commercial production for Stage 2 at the Montepuez Graphite
Project.
▪
The issue of ZEPOs in 2018 is designed by the Board to:
▪
align executives and other employees’ objectives with the Company’s publicly stated objectives of
developing stages 1 and 2 of the Company’s Montepuez graphite project;
be granted in lieu of any salary review increases;
be granted in lieu of a 2018 short term incentive programme.
align employees to shareholders by connecting cash flow generation to the vesting of benefits
▪
▪
▪
Given the nature and current operations of the Group, the Board exercises their discretion in determining whether
additional options are granted each year. The Board envisages that the Company’s remuneration policies and
procedures for executive remuneration will also evolve to a more traditional corporate governance model and in
line with ASX Corporate Governance guidelines. This is expected to include a more traditional performance based
short term and long-term incentive plans, which will be considered by the Remuneration Committee and
recommended to the Board for its consideration.
Page 11
33
2018 Annual Report
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Directors’ Report (continued)
Directors’ Report (continued)
Audited Remuneration Report (continued)
v)
Other Benefits
No benefits other than noted above are paid to Directors or Management except as incurred in normal operations
of the business.
vi)
Remuneration Consultants
Remuneration consultants have not been used in determining the remuneration paid.
B Details of Remuneration Paid
Amounts of Remuneration
Details of the remuneration of the Directors and Key Management Personnel of the Group as at 31 December 2018 are
summarised in the table below:
Fixed Remuneration, $
Short- term employee benefits
31 December 2018
Salary &
fees
Termination
benefit
Non-
monetary
benefits
Post-
employme
nt benefits
Super-
annuation
Performance Based
Remuneration, $
Share-based payments
Total
% of
variable
remuner
ation
Options
Shares
Rights
Directors
Non-Executive Directors
Jeff Dowling - appointed 25/01/18
Gilbert George
Brett Smith
Paul Glasson
Ivy Chen - appointed 25/01/18
Sub-total
Executive Directors
David Flanagan
Cherie Leeden – resigned 25/01/18
Sub-total
Key Management Personnel (KMP)
Nick Day – appointed 8/10/18
Tony Walsh
Ben Van Roon
Jeff Dawkins – resigned 8/10/18
Andy Cardoso – resigned 30/06/18
Sub-total
Total Directors and KMP
compensation (Group)
76,889
60,500 (1)
45,000
49,210 (1)
38,444
270,043
444,951
87,734
532,685
66,065
240,000 (3)
306,951
230,907
177,765
1,021,688
-
-
-
-
-
-
-
112,908 (2)
112,908
-
-
-
46,659 (5)
-
46,659
1,824,416
159,567
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
7,304
-
-
3,652
10,957
20,049
-
20,049
5,012
-
20,049
18,787
-
43,848
52,300
62,029
62,029
57,223
34,867
268,448
474,361
210,118
684,479
- (4)
20,181
14,750
-
5,243
40,173
74,854
993,100
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
136,493
122,529
107,029
106,433
76,964
549,448
114,647
41,712
156,359
1,054,008
452,472
1,506,480
-
24,832
24,832
-
-
49,665
71,077
285,013
366,582
296,353
183,008
1,202,033
206,024
3,257,961
The above table includes values for share based payments (options & performance rights) at their fair value.
(1)
(2)
(3)
(4)
(5)
The directors’ fees of Gilbert George and Paul Glasson include fees for the additional professional consultancy work of $15,788 and $3,790
respectively.
Entitlement of Cherie Leeden to a termination benefit as part of the service agreement. The termination benefit was agreed as 9.5% of the
total gross fees paid to Ms Leeden from the commencement of her position with the Group.
$240,000 is the 80% part-time pro-rata of the annual service fees of $300,000 as per the service agreement.
6,000,000 options were granted to Nick Day on 15 March 2019 following the Board’s approval.
A termination benefit in a form of lieu of notice was paid to Jeff Dawkins in accordance with his employment agreement.
%
38
51
58
54
45
49
56
56
56
-
16
11
-
3
7
37
Page 12
34
Battery Minerals Limited
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Directors’ Report (continued)
Directors’ Report (continued)
Audited Remuneration Report (continued)
Details of the remuneration of the Directors and Key Management Personnel of the Group as at 31 December 2017 are
summarised in the table below:
Fixed Remuneration, $
Performance Based Remuneration, $
Short- term employee benefits
Cash salary
& fees
Other
Entitle
ments
Non-
monetar
y
benefits
Post-
employment
benefits
Super-
annuation
Share-based payments
Options
Shares
Rights
Total
% of
variable
remuner
ation
%
57,100
45,000
31,500
133,600
334,935
301,045
635,980
150,854
89,825
115,175
212,342
568,196
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,454
-
1,454
-
-
-
-
15,241
-
15,241
-
7,046
8,459
-
15,505
187,646
187,646
57,223
432,515
1,310,924
194,916
1,505,840
34,343
-
-
53,230
87,573
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
244,746
232,646
88,723
566,115
-
101,500
101,500
1,661,100
597,461
2,258,561
-
-
-
-
-
185,197
96,871
125,088
265,572
672,728
1,337,776
-
1,454
30,746
2,025,928
-
101,500
3,497,404
81
81
64
76
79
50
71
19
-
-
20
13
58
31 December 2017
Directors
Non-Executive Directors
Gilbert George
Brett Smith
Paul Glasson -appointed 19/04/17
Sub-total
Executive Directors
David Flanagan
Cherie Leeden
Sub-total
Key Management Personnel (KMP)
Tony Walsh- appointed 17/02/17
Ben Van Roon- appointed 11/08/17
Jeff Dawkins – appointed 18/12/17
Andy Cardoso -appointed 6/04/17
Sub-total
Total Directors and KMP
compensation (Group)
The above table includes values for share based payments (options & performance rights) at their fair value.
C Service Agreements
Non-Executive Directors
On appointment to the Board, all Non-Executive Directors enter into a service agreement with the Group in the form of a
letter of appointment. The letter summarises the Board policies and terms, including compensation, relevant to a director.
Name
Non-Executive
Chairman – Jeff Dowling
Director – Gilbert George
Director – Brett Smith
Director – Paul Glasson
Director - Ivy Chen
Term of
Agreement
Base Salary including
Superannuation
Termination Benefit (1)
Open
Open
Open
Open
Open
$90,000
$45,000
$45,000
$45,000
$45,000
Nil. Subject to re-election by shareholders.
Nil. Subject to re-election by shareholders.
Nil. Subject to re-election by shareholders.
Nil. Subject to re-election by shareholders.
Nil. Subject to re-election by shareholders.
(1) Subject to clause 13.2 of the Company’s constitution, at the Company's annual general meeting in every year, one-third of the Directors for
the time being, or, if their number is not a multiple of 3, then the number nearest one-third (rounded upwards in case of doubt), shall retire
from office, provided always that no Director except a Managing Director shall hold office for a period in excess of 3 years, or until the third
annual general meeting following his or her appointment, whichever is the longer, without submitting himself for re-election. The Directors
to retire at an annual general meeting are those who have been longest in office since their last election, but, as between persons who
became Directors on the same day, those to retire shall (unless they otherwise agree among themselves) be determined by drawing lots. A
retiring Director is eligible for re-election. An election of Directors shall take place each year.
Non-Executive Directors are subject to standard terms and conditions including duties to the Group, confidentiality and
disclosure.
Page 13
35
2018 Annual Report
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Directors’ Report (continued)
Directors’ Report (continued)
Audited Remuneration Report (continued)
Key Management Personnel
Remuneration and other terms of employment for a Managing Director and Key Management Personnel are formalized in
their service agreements. Employees are eligible for long-term incentive benefits under the Battery Minerals Employee
Option Plan.
Mr David Flanagan, Managing Director
•
•
•
Base Remuneration - $465,000 inclusive of superannuation.
Equity Incentive Sign on Entitlement – 10,000,000 five-year options vesting on achieving sales agreements and a
commercial rate of production as agreed by the board
Termination – 6 months’ notice
Ms Cherie Leeden, Executive Director Technology and Business Development - Resigned 25 January 2018
Base Remuneration – USD $230,000 (equivalent AUD$326,000 as at 31 December 2018)
Equity Incentive – 5,000,000 five-year options vesting on achieving commercial production and sale from the
proposed Company owned, US based SPG processing plant
•
•
Mr Tony Walsh, Joint Company Secretary
•
•
•
Base Remuneration - $300,000 including superannuation (paid pro-rata for working part-time)
Equity Incentive sign on Entitlement – Issue of 1,500,000 Options under the Employee Share Option Plan, 500,000
vesting on 12 months anniversary of commencement date and 1,000,000 vesting on the commencement of
commercial production
Termination – Nil notice
Mr Ben Van Roon, Chief Operating Officer
•
•
•
•
Base Remuneration - $325,000 inclusive of superannuation
Equity Incentive Sign on Entitlement – Issue of 3,000,000 Options under the Employee Share Option Plan,
1,000,000 vesting on 12 months anniversary of commencement date and 2,000,000 vesting on the
commencement of commercial production.
Long Term Incentive – Options to the value of 30% TFR as approved by the Board from time to time.
Termination – One-month notice
Mr Jeff Dawkins, Chief Financial Officer & Joint Company Secretary – Resigned 8 October 2018
•
•
•
•
Base Remuneration - $300,000 inclusive of superannuation.
Equity Incentive Sign on Entitlement – Issue of 2,500,000 Options under the Employee Share Option Plan,
1,000,000 vesting on 12 months anniversary of commencement date and 1,500,000 vesting on the
commencement of commercial production.
Long Term Incentive – Options to the value of 30% TFR as approved by the Board from time to time.
Termination – 3 months’ notice.
Mr Andy Cardoso, Project Director - Resigned 30 June 2018
•
•
•
Base Remuneration – USD $260,000 (equivalent AUD$333,000 as at 31 December 2017)
Equity Incentive Sign on Entitlement – Issue of 2,500,000 Options under the Employee Share Option Plan,
1,000,000 vesting on 12 months anniversary of commencement date and 1,500,000 vesting on the
commencement of commercial production.
Long Term Incentive – Options to the value of 30% TFR as approved by the Board from time to time.
Mr Nick Day, Chief Financial Officer & Joint Company Secretary – Commenced 8 October 2018
•
•
•
Base Remuneration - $300,000 inclusive of superannuation.
Equity Incentive – Issue of 2,000,000 options under the Employee Share Option Plan, 1,000,000 vesting on 12
months anniversary of commencement date and 1,000,000 vesting on the commencement of commercial
production; and 4,000,000 zero exercise options, 1,000,000 vesting on the commencement of commercial
production of Montepuez phase 1, 2,000,000 vesting on the commencement of commercial production of
Montepuez phase 2 and 1,000,000 vesting on the commencement of commercial production of the Balama
Project.
Termination – 3 months’ notice
Page 14
36
Battery Minerals Limited
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Directors’ Report (continued)
Directors’ Report (continued)
Audited Remuneration Report (continued)
D Share-based Compensation
Options
(a) The following options were issued to Directors and Key Management Personal as remuneration during the
financial year with the conditions as shown below:
David Flanagan (1)
Ivy Chen (2)
Jeff Dowling (2)
Ben van Roon (1)
Ben van Roon (2)
Tony Walsh (1)
Jeff Dawkins (1), (3)
Jeff Dawkins (2), (3)
Date
Options
Granted
27-Jun-18
27-Jun-18
27-Jun-18
27-Jun-18
27-Jun-18
27-Jun-18
27-Jun-18
27-Jun-18
Vesting
Date
Number of
Options
Granted
20,000,000 Various (4)
3,000,000 Various (5)
4,500,000 Various (5)
4,000,000 Various (6)
3,000,000 Various (7)
4,000,000 Various (6)
4,000,000 Various
2,500,000 Various
45,000,000
Expiry
Date
Exercise
Price
03-Jul-23
30-Jun-23
30-Jun-22
13-Jul-23
16-Jul-23
13-Jul-23
13-Jul-23
16-Jul-23
nil
0.13
0.13
Nil
0.20
nil
nil
0.20
Value per
option at
grant date, $
0.031
0.0166
0.0166
0.031
0.0144
0.031
0.031
0.0144
Total Fair
Value, $
%
vested
465,000
49,907
74,861
124,000
43,302
124,000
124,000
36,085
1,041,155
0%
0%
0%
0%
0%
0%
0%
0%
(1) Options were issued at $nil exercise price and valued at the market share price on a date of issue.
(2) Other options issued during the year were valued using the Black-Scholes option pricing method with the following
(3) Options were forfeited on resignation after three months following the issue and corresponding value was reversed in profit and loss.
(4) Options vesting conditions are linked to commencement of commercial production being 25% of Montepuez phase 1, 50% of Montepuez
phase 2 and 25% Balama stage 1.
50% of options will vest upon 12 months and 50% will vest upon 24 months of continuous service.
(5)
(6) Options vesting conditions are linked to commencement of commercial production being 50% of Montepuez phase1 and 50% of Montepuez
(7)
phase 2.
1,000,000 options will vest on 12 months continuous services and 2,000,000 will vest on commencement of the Montepuez Graphite Project
commercial production.
inputs:
Recipient
Jeff Dowling
Ivy Chen
Ben van Roon
Jeff Dawkins
Dividend
Yield
Expected
Volatility
(*)
Risk Free
Rate (**)
Expected
Life of
Options
Exercise
Price
Share Price at
Grant Date
FV per option
-
-
-
-
100%
100%
100%
100%
2.17%
2.17%
2.17%
2.17%
5 years
5 years
5 years
5 years
$0.13
$0.13
$0.20
$0.20
$0.03
$0.03
$0.03
$0.03
$0.0166
$0.0166
$0.0144
$0.0144
(*) The expected volatility is based on historic volatility (based on remaining life of the options), adjusted for any expected chances to future volatility
due to publicly available information.
(**) Risk free rate is based on Australia 5-year bond yield rate.
Page 15
37
2018 Annual Report
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Directors’ Report (continued)
Directors’ Report (continued)
Audited Remuneration Report (continued)
(b) The following options granted in previous years have impacted the current year remuneration. All options unvested at
31 December 2018 will also have an impact on future year’s remuneration. Conditions are shown below:
Date
Options
Granted
26-May-17
26-May-17
26-May-17
6-Apr-17
15-Feb-17
21-Dec-16
21-Dec-16
21-Dec-16
21-Dec-16
21-Dec-16
Vesting
Date
Number of
Options
Granted
10,000,000 Various (1)
3,000,000 Various (2)
5,000,000 Various (3)
2,500,000 Various (4)
1,500,000 Various (5)
5,000,000 21-Dec-18
5,000,000 21-Dec-18
10,000,000 Various (6)
1,500,000 21-Dec-18
1,500,000 21-Dec-18
Expiry Date
Exercise
Price
26-May-22
26-May-22
26-May-22
22-May-22
23-Dec-21
23-Dec-21
23-Dec-21
23-Dec-21
23-Dec-21
23-Dec-21
0.094
0.13
0.20
0.20
0.15
0.20
0.25
0.155
0.155
0.155
Value per
option at
grant date, $
0.0456
0.0424
0.0380
0.0604
0.0636
0.0818
0.0778
0.0861
0.0861
0.0861
David Flanagan
Paul Glasson
Cherie Leeden
Andy Cardoso
Tony Walsh
David Flanagan
David Flanagan
Cherie Leeden
Gilbert George
Brett Smith
45,000,000
Total Fair
Value, $
%
vested
0%
50%
0%
40%
20%
100%
100%
0%
100%
100%
455,638
127,162
190,124
150,984
95,384
408,961
389,108
861,040
129,156
129,156
2,936,713
(1) Options will vest upon the Company’s Montepuez Project achieving sales agreements and a commercial rate of production as agreed by the
board.
(2) 50% of options will vest upon 12 months and 50% will vest upon 24 months of continuous service.
(3) Options will vest upon commercial production and sale from the proposed Company owned, US based SPG processing plant.
(4) 1,000,000 options vested upon 12-month anniversary on 15 May 2018 and expired 90 days following the resignation on 30 June 2019. 1,500,000
options will vest upon commencement of Montepuez Graphite Project commercial production.
(5) 500,000 options vested on 17 February 2918 upon 12 months of service with the Company. 1,000,000 options will vest upon commencement
of Montepuez Graphite Project commercial production.
(6) Options will vest upon the first commercial scale production and shipment of graphite ore from the Montepuez Graphite Project.
Options granted carry no dividend or voting rights.
No shares were issued on the exercise of remuneration options during the financial year. When exercised each option is
convertible into one ordinary share of Battery Minerals Limited.
Shares
During the financial year no shares were issued to Directors or Key Management Personnel in lieu of fees and salary.
E Director and Key Management Share and Option Holdings
Shareholdings
The numbers of shares in the Group held during the financial period by each director of Battery Minerals Limited and other
key management personnel of the Group, including their personally related parties are set out below.
Page 16
38
Battery Minerals Limited
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Directors’ Report (continued)
Directors’ Report (continued)
Audited Remuneration Report (continued)
31 December 2018
Name
Directors
Gilbert George
Cherie Leeden
Brett Smith
Ivy Chen
Jeff Dowling
David Flanagan
KMP
Tony Walsh
Nick Day
Jeff Dawkins – resigned 8/10/18
Andy Cardoso – resigned 30/06/18
Total
Balance at the start
of the year,
number of shares
Received during
the year on the
exercise of options
Other changes1
Balance at the end
of the year,
number of shares
6,698,656
4,658,964
478,522
-
-
1,561,111
-
-
-
-
13,397,253
-
3,500,000 (2)
-
-
-
-
-
-
-
3,500,000
2,500,000
(8,158,964) (3)
250,000
100,000
1,500,000
3,436,381
850,000
-
-
-
477,417
9,198,656
-
728,522
100,000
1,500,000
4,997,492
850,000
-
-
-
17,374,670
(1)
(2)
(3)
Shares acquired & disposed on-market during the financial year.
3,500,000 performance rights were converted to ordinary shares upon their vesting on 23 March 2018.
The balance of shares at the end of the financial year is considered to be nil due to the resignation of Cherie Leeden as a Company Director.
Option & performance rights holdings
The numbers of options & performance rights over ordinary shares in the Group held during the financial period by each
director of Battery Minerals Limited and key management personnel (KPM) of the Group, including their personally
related parties are set out below.
31 December
2018
Balance at
start of the
year
Granted as
Remuneration
Placement
Options
Exercised
Expired/
Forfeited/
Other
Changes
Balance at
end of the
year
Vested and
exercisable
Unvested
Directors
Paul Glasson
Gilbert George
Brett Smith
Ivy Chen
Jeff Dowling
David Flanagan
Cherie Leeden
KMP
Tony Walsh
Ben van Roon
Jeff Dawkins
Andy Cardoso
3,000,000
4,000,000
4,000,000
-
-
-
-
-
3,000,000
4,500,000
30,000,000
20,000,000
-
500,000 (2)
125,000 (3)
50,000 (3)
300,000 (3)
425,000 (3)
-
-
-
-
-
-
-
-
-
-
-
-
3,000,000
1,500,000
1,500,000
4,500,000
4,000,000
4,125,000
4,000,000
3,050,000
4,800,000
-
-
500,000
125,000
3,050,000
4,800,000
50,425,000
20,000,000
30,425,000
19,500,000
-
-
3,500,000 (1)
16,000,000 (3)
-
-
-
1,500,000
-
-
2,500,000
4,000,000
7,000,000
6,500,000
-
175,000 (3)
-
-
-
-
-
-
-
-
5,675,000
7,000,000
6,500,000
2,500,000 (5)
-
-
500,000
5,175,000
-
-
-
7,000,000
-
-
Total
64,500,000
45,000,000
1,575,000
3,500,000
25,000,000
82,575,000
30,000,000
52,575,000
(1)
(2)
(3)
Cherie Leeden’s rights holdings opening balance includes 3,500,000 performance rights, which vested and exercised in March 2018.
125,000 options issued under SPP as approved by the General Meeting of the shareholders on 27 June 2018. 375,000 options were issued
under Tranche 2 of the Initial Placement plan granted for nil consideration as a free-attaching option to the Tranche 2 initial placement
shares.
Options were issued under Tranche 2 of the Initial Placement plan granted for nil consideration as a free-attaching option to the Tranche 2
initial placement shares.
Page 17
39
2018 Annual Report
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Directors’ Report (continued)
Directors’ Report (continued)
Audited Remuneration Report (continued)
(4)
(5)
(6)
No options were issued to Nick Day during the period from his commencement on 8 October 2018 till the end of the year. Options to be
issued in 2019 upon an approval by the board of directors.
Includes 1,000,000 options vested in June 2018 and expired in September 2018.
The balance of options at the end of the financial year is considered to be nil due to the resignation of Cherie Leeden as a Company Director.
F Additional Information
Loans to Key Management Personnel
There were no loans made to Directors of the Company or other key management personnel during the year ended 31
December 2018.
There were no other transactions with key management personnel during the year ended 31 December 2018.
End of the Audited Remuneration Report
Adoption of Key Management Personnel Remuneration Report
Voting of shareholders at last year’s annual general meeting Battery Minerals Limited received more than 97% of “yes”
votes on its remuneration report for the 2018 financial year. The company did not receive any specific feedback at the
AGM or throughout the year on its remuneration practices.
This report of Directors, incorporating the Remuneration Report, is signed in accordance with a resolution of Directors.
Competent Person’s Statement
Battery Minerals confirms that all the material assumptions underpinning the production targets for its Montepuez and
Balama Central graphite projects and any of the forecast financial information derived from these production targets, in
the 4 and 12 December 2018 ASX announcements, on these projects continue to apply at the date of release of this
presentation and have not materially changed. Battery Minerals confirms that it is not aware of any new information or
data that all material assumptions and technical parameters underpinning the estimates in the 4 and 12 December 2018
announcements continue to apply and have not materially changed.
All references to future production and production & shipping targets and port access made in relation to Battery Minerals
are subject to the completion of all necessary feasibility studies, permit applications, construction, financing arrangements,
port access and execution of infrastructure-related agreements. Where such a reference is made, it should be read subject
to this paragraph and in conjunction with further information about the Mineral Resources and Ore Reserves, as well as
the relevant competent persons' statements.
Any references to Ore Reserve and Mineral Resource estimates should be read in conjunction with the competent person
statements included in the ASX announcements referenced in this report as well as Battery Minerals’ other periodic and
continuous disclosure announcements lodged with the ASX, which are available on the Battery Minerals’ website. For
Mineral Resources - See announcement dated 18th October 2018 for full details and Competent Persons sign-off. For Ore
Reserves - See announcements dated 4 and 12 December 2018 for full details and Competent Persons sign-off.
The information in this report that relates to Battery Minerals’ Mineral Resources or Ore Reserves is a compilation of
previously published data for which Competent Persons consents were obtained. Their consents remain in place for
subsequent releases by Battery Minerals of the same information in the same form and context, until the consent is
withdrawn or replaced by a subsequent report and accompanying consent.
40
Page 18
Battery Minerals Limited
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Directors’ Report (continued)
Directors’ Report (continued)
Lead Auditor’s Independence Declaration under Section 307C of the Corporations Act 2001.
The lead auditor’s independence declaration is set out on page 42 for the year ended 31 December 2018.
This report is made in accordance with a resolution of the Directors.
____________________________
David Flanagan
Managing Director
Perth, Western Australia, 22 March 2019
41
Page 19
2018 Annual Report
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Auditor’s Independence Declaration
Auditor’s Independence Declaration
42
Page 20
Battery Minerals Limited
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Independent Auditor’s Report
Independent Auditor’s Report
43
Page 21
2018 Annual Report
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Independent Auditor's Report (continued)
Independent Auditor’s Report (continued)
44
Page 22
Battery Minerals Limited
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Independent Auditor's Report (continued)
Independent Auditor’s Report (continued)
45
Page 23
2018 Annual Report
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Independent Auditor's Report (continued)
Independent Auditor’s Report (continued)
46
Page 24
Battery Minerals Limited
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Independent Auditor's Report (continued)
Independent Auditor’s Report (continued)
47
Page 25
2018 Annual Report
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Consolidated Statement of Profit or Loss
Consolidated Statement of Profit or Loss and Other Comprehensive Income
and Other Comprehensive Income
For the year ended 31 December 2018
For the year ended 31 December 2018
Other Income
Gain on disposal of subsidiary
Net foreign exchange gain
Accounting, tax advisory and audit fees
Consultants fees
Salaries and wages
Share based payment expense
Travel
Compliance fees
Directors’ salaries and fees
Legal fees
Conferences
Fair value adjustment on equity securities
Other expenses
Operating loss
Interest income
Loss before tax from continuing operations
Income tax expense
Loss from continuing operations
Loss for the period
Other comprehensive income/(loss):
Items that will be reclassified subsequently to profit or loss:
Exchange difference on translation of foreign operations
Total comprehensive loss for the period
Loss for the year attributable to:
Owners of Battery Minerals Limited
Total comprehensive loss for the year attributable to:
Owners of Battery Minerals Limited
Loss per share from continuing operations:
Basic loss per share (cents)
Diluted loss per share (cents)
Note
24
16,22
4
5
6
6
Consolidated
31-Dec-18
$
Consolidated
31-Dec-17
$
33,969
282,858
232,365
(372,921)
(1,059,895)
(1,988,549)
(1,353,549)
(359,765)
(425,318)
(946,642)
(169,795)
(190,618)
(174,350)
(895,235)
(7,387,445)
144,280
(7,243,165)
-
-
(74,980)
(753,820)
(656,017)
(2,402,609)
(583,945)
(95,862)
(769,580)
(114,062)
-
-
(408,117)
(5,858,992)
36,341
(5,822,651)
-
-
(7,243,165)
(5,822,651)
(7,243,165)
(5,822,651)
282,002
(6,961,163)
186,447
(5,636,204)
(7,243,165)
(5,822,651)
(6,961,163)
(5,636,204)
(0.763)
(0.763)
(1.330)
(1.330)
The above consolidated statement of profit or loss and other comprehensive income is to be read in conjunction with
the accompanying notes.
Page 26
48
Battery Minerals Limited
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Consolidated Statement of Financial Position
Consolidated Statement of Financial Position
As at 31 December 2018
As at 31 December 2018
ASSETS
Current Assets
Cash and cash equivalents
Other receivables
Total Current Assets
Non-Current Assets
Other debtors
Property, plant and equipment
Intangible assets
Investments
Mine development expenditure
Exploration & evaluation expenditure
Total Non-Current Assets
Total Assets
LIABILITIES
Current Liabilities
Trade and other payables
Total Current Liabilities
Total Liabilities
NET ASSETS
EQUITY
Issued Capital
Reserves
Accumulated Losses
TOTAL EQUITY
Note
8
9
9
10
11
19 (f)
13
12
14
15
16
17
Consolidated
31-Dec-18
$
Consolidated
31-Dec-17
$
7,252,709
407,507
7,660,216
3,523,792
521,226
23,363
84,533
30,950,808
2,902,615
38,006,337
45,666,553
7,723,112
702,269
8,425,381
-
605,951
-
-
10,433,531
11,039,482
19,464,863
1,021,902
1,021,902
1,021,902
1,618,470
1,618,470
1,618,470
44,644,651
17,846,393
74,125,719
5,877,758
(35,358,826)
44,644,651
41,516,848
4,445,206
(28,115,661)
17,846,393
The above consolidated statement of financial position is to be read in conjunction with the accompanying notes.
Page 27
49
2018 Annual Report
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Consolidated Statement of Cash Flows
Consolidated Statement of Cash Flows
For the year ended 31 December 2018
For the year ended 31 December 2018
Cash flows from operating activities
Payments to suppliers and employees
Net interest received
Net cash (outflow) from operating activities
Cash flows from investing activities
Net proceeds from sale of subsidiary
Payments made for property, plant and equipment and intangibles
Payments for exploration & evaluation expenditure
Payments for mine development expenditure
Payment for mine performance bond
Net cash (outflow) from investing activities
Cash flows from financing activities
Proceeds from share issue
Capital raising costs
Net cash inflow from financing activities
Net increase/(decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year
Effect of exchange rate fluctuations on cash held
Cash and cash equivalents at end of year
Note
Consolidated
31-Dec-18
$
Consolidated
31-Dec-17
$
(6,414,986)
144,280
(6,270,706)
(3,779,528)
36,341
(3,743,187)
18
264,320
(232,674)
(851,922)
(21,641,595)
(3,523,792)
(25,985,663)
34,065,982
(2,244,527)
31,821,455
(434,914)
7,723,112
(35,489)
7,252,709
302,939
(411,278)
(4,158,384)
-
-
(4,266,723)
6,375,497
(403,783)
5,971,714
(2,038,196)
9,755,258
6,050
7,723,112
The above consolidated statement of cash flows is to be read in conjunction with the accompanying notes.
50
Page 28
Battery Minerals Limited
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Consolidated Statement of Changes in Equity
Consolidated Statement of Changes in Equity
For the year ended 31 December 2018
For the year ended 31 December 2018
Consolidated for the year ended 31
December 2017
Issued
Capital
Share based
payment
reserve
$
$
Foreign
currency
translation
reserve
$
Accumulated
losses
$
Total
$
Balance at 1 January 2017
35,545,134
2,505,297
(620,328)
(22,321,829)
15,108,274
Loss for the year
Other comprehensive income
Total comprehensive income/(loss)
for the year
Transactions with owners of Battery
Minerals Limited
Shares issued net of transaction costs
Share based payments
Total transactions with owners of
Battery Minerals Limited
-
-
-
-
-
-
-
186,447
(5,822,651)
(5,822,651)
-
186,447
186,447
(5,822,651)
(5,636,204)
5,971,714
-
2,373,790
5,971,714
2,373,790
-
-
-
-
28,819
5,971,714
2,402,609
28,819
8,374,323
Balance at 31 December 2017
41,516,848
4,879,087
(433,881)
(28,115,661)
17,846,393
Consolidated for the year ended 31
December 2018
Issued Capital
$
Share based
payment
reserve
Foreign
currency
translation
reserve
$
Accumulated
losses
Total
$
$
Balance at 1 January 2018
41,516,848
4,879,087
(433,881)
(28,115,661)
17,846,393
Loss for the year
Other comprehensive income
Total comprehensive income(/loss) for
the year
Transactions with owners of Battery
Minerals Limited
Shares issued net of transaction costs
Share based payments
Total transactions with owners of
Battery Minerals Limited
-
-
-
-
-
-
-
(7,243,165)
(7,243,165)
282,002
-
282,002
282,002
(7,243,165)
(6,961,163)
32,608,871
-
-
1,150,550
32,608,871
1,150,550
-
-
-
-
-
32,608,871
1,150,550
33,759,421
Balance at 31 December 2018
74,125,719
6,029,637
(151,879)
(35,358,826)
44,644,651
The consolidated statement of changes in equity is to be read in conjunction with the accompanying notes.
Page 29
51
2018 Annual Report
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Notes to the Consolidated Financial Statements
Notes to the Consolidated Financial Statements
1.
Reporting Entity
Battery Minerals Limited is an ASX listed public company, incorporated and domiciled in Australia. Battery Minerals
is a for-profit entity for the purposes of preparing the financial statements.
These consolidated financial statements comprise Battery Minerals Limited and its subsidiaries (together referred
as the ‘Group’). The Group is primarily involved in exploration and development activities relating to its mining
operations.
2.
Basis of Accounting
The consolidated financial statements are general purpose financial statements which have been prepared in
accordance with Australian Accounting Standards (AASBs) adopted by the Australian Accounting Standards `Board
(AASB) and the Corporations Act 2001. The consolidated financial statements comply with International Financial
Reporting Standards (IFRS) adopted by the International Accounting Standards Board (IASB). They were authorised
for issue by the Board of Directors on 22 March 2019.
The financial report has been prepared on an accrual basis and is based on historical costs, modified, where
applicable, by the measurement at fair value of selected non-current assets, financial assets and financial liabilities.
A. Principles of Consolidation
The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Battery Minerals
Limited (‘’Company’’ or ‘’Parent Entity’’) as at 31 December 2018 and the results of all subsidiaries for the year.
Battery Minerals Limited and its subsidiaries together are referred to in this financial report as “the Group” or “the
consolidated entity”.
Subsidiaries are entities over which the Group has control. The Group controls an entity when the Group is exposed
to, or has right to, variable returns from its involvement with the entity and has the ability to affect those returns
through its power to direct activities of the entity. The financial statements of subsidiaries are included in the
consolidated financial statements from the date on which control commences. They are de-consolidated from the
date that control ceases. The acquisition method of accounting is used to account for the acquisition of subsidiaries
by the Group.
Intercompany transactions, balance and unrealised gains on transactions between Group companies are eliminated.
Unrealised losses are also eliminated unless the transaction provides evidence of the impairment of the asset
transferred. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the
policies adopted by the Group.
Investments in subsidiaries and joint venture entities are accounted for at cost in the financial statements of the
Company. Dividends received from associates are recognised in the parent entity’s statement of profit or loss and
other comprehensive income, rather than being deducted from the carrying amount of these investments.
B. Going Concern Basis of Preparation
The financial statements have been prepared on the going concern basis which assumes the company and
consolidated entity will have sufficient funds to pay its debts, as and when they become payable, for a period of at
least 12 months from the date the financial report was authorised for issue.
As at 31 December 2018, the consolidated entity has net assets of $44,644,651 (2017: $17,846,393). During the
financial year the consolidated entity had cash outflows from operating activities of $6,270,706 (2017: $3,743,187)
and cash outflows from investing activities (including payments for mine development and exploration) of
$25,985,663 (2017: $4,266,723). The consolidated entity has minimum expenditure commitments as set out in Note
25.
52
Page 30
Battery Minerals Limited
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Notes to the Consolidated Financial Statements (continued)
Notes to the Consolidated Financial Statements (continued)
2.
Basis of Accounting (continued)
The consolidated entity has prepared a cash flow forecast which indicates that the consolidated entity will need to
raise additional funds to meet expenditure commitments and support its current level of corporate overheads to
continue as a going concern. The Directors believe this additional working capital will be provided by an interim
capital raising and to this end discussions have already commenced. At the same time, the Directors will continue
their focus on maintaining an appropriate level of corporate overheads in line with available cash resources.
In addition, future significant project debt and equity finance will need to be available in order for the consolidated
entity to progress the Montepuez Graphite Project to completion.
The directors are confident that they will be able to complete an interim capital raising that will provide the
consolidated entity with sufficient funding to meet its minimum expenditure commitments and support its planned
level of overhead expenditures. The directors also believe that discussions with senior debt lenders and equity
providers for the Montepuez Project are sufficiently progressed to reasonably believe that such debt and equity will
be available. The directors therefore believe that it is appropriate to prepare the 31 December 2018 financial
statements on a going concern basis.
However, in the event that the consolidated entity is not able to successfully complete debt or equity fundraisings
referred to, material uncertainty would exist as to whether the company and consolidated entity will continue as a
going concern and, therefore, whether they will realise their assets and extinguish their liabilities in the normal
course of business and at the amounts stated in the financial statements.
The financial statements do not include adjustments relating to the recoverability and classification of recorded
asset amounts, nor to the amounts and classification of liabilities that might be necessary should the company and
the consolidated entity not continue as going concerns.
C. Foreign Currency Translation
Functional and presentation currency
The consolidated financial statements are presented in Australian dollars, which is Battery Minerals Limited’s
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 (‘the functional
currency’).
Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the
dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and
from the translation at year end exchange rates of monetary assets and liabilities denominated in foreign currencies
are recognised in profit or loss, except when they are deferred in equity as qualifying cash flow hedges and qualifying
net investment hedges or are attributable to part of the net investment in a foreign operation.
Foreign exchange gains and losses that relate to borrowings are presented in the statement of profit of loss and
other comprehensive income, within finance costs. All other foreign exchange gains and losses are presented in the
statement of profit of loss and other comprehensive income on a net basis within other income or other expenses.
Non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rates at the date
when the fair value was determined. Translation differences on assets and liabilities carried at fair value are reported as part of
the fair value gain or loss.
Foreign Operations
The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on acquisition,
are translated into presentation currency of the Group at the exchange rates at the reporting date. The income and
expenses of foreign operations are translated at the exchange rates at the dates of the transactions. Foreign currency
differences are recognised in other comprehensive income/loss and accumulated in the translation reserve.
Page 31
53
2018 Annual Report
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Notes to the Consolidated Financial Statements (continued)
Notes to the Consolidated Financial Statements (continued)
2.
Basis of Accounting (continued)
When a foreign operation is disposed the cumulative amount in the translation reserve related to that foreign
operation is reclassified to profit or loss as part of the gain or loss on disposal. If the Group disposes of part of its
interest in a subsidiary but retains control, then the relevant proportion of the cumulative amount is reattributed to
NCI.
D.
Impairment of Assets
At each reporting date, or more frequently if events or changes in circumstances indicate that assets might be
impaired, the Group reviews the carrying values of its tangible and intangible assets to determine whether the assets
have been impaired. If such an indication exits, the recoverable amount of the asset, being the higher of the asset’s
fair value less costs to sell and value in use, compared to the asset’s carrying value. Any excess of the asset’s carrying
value over its recoverable amount is expensed to the Consolidated Statement of Profit or Loss and other
Comprehensive Income.
Where it is not possible to estimate the recoverable amount of an individual asset, the Group estimates the
recoverable amount of the cash-generating unit to which the asset belongs.
Non-financial assets other than goodwill that suffered any impairment are reviewed for possible reversal of
impairment at the end of each reporting period.
E. Use of Estimates and Judgements
In preparing these consolidated financial statements, management has made judgements, estimates and
assumptions that affect the application of the Group’s accounting policies and the reported amounts of assets,
liabilities, income and expenses.
Estimates and judgements are continually evaluated and are based on historical experience and other factors,
including expectations of future events that may have a financial impact on the entity and that are believed to be
reasonable under the circumstances. Revisions to estimates are recognised prospectively
The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by
definitions, seldom equal the related actual results. The estimates and assumptions that have a risk of causing a
material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed in
the notes indicated below:
Impairment of exploration and evaluation expenditure and the mine development – Note 12 and 13
Share-based payments – Note 16 and 22
F. Changes in Accounting Policy
In the year ended 31 December 2018, the Group has reviewed all the new and revised standards and interpretations
issued by the Australian Accounting Standards Board that are relevant to its operations and effective for the current
year. The Group has adopted AASB 15 and AASB 9 with an effect from 1 January 2018. It has been determined by
the Group that there is no impact, material or otherwise, of the new and revised standards and interpretations on
its business. and, therefore no restatement of prior year comparatives is necessary to the Group’s financial
statements.
54
Page 32
Battery Minerals Limited
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Notes to the Consolidated Financial Statements (continued)
Notes to the Consolidated Financial Statements (continued)
Mandatory
application date/
Date adopted by
company
Annual reporting
periods beginning
on or after 1
January 2019.
2.
Basis of Accounting (continued)
G. Standards issued not yet effective
Title of standard
Nature of change
Impact
AASB 16 (issued
February 2016)
Leases
AASB 16 eliminates the operating and finance lease
classifications for lessees currently accounted for under
AASB 117 Leases. It instead requires an entity to bring
most leases onto its balance sheet in a similar way to
how existing finance leases are treated under AASB 117.
An entity will be required to recognise a lease liability
and a right of use asset in its balance sheet for most
leases.
There are some optional exemptions for leases with a
period of 12 months or less and for low value leases.
Lessor accounting remains largely unchanged from AASB
117.
To the extent that the entity, as lessee,
has significant operating leases
outstanding at the date of initial
application, 1 January 2019, right-of-use
assets will be recognised for the amount
of the unamortised portion of the useful
life, and lease liabilities will be recognised
at the present value of the outstanding
lease payments.
There will be an overall reduction in net
profit before tax in the early years of a
lease because the amortisation and
interest charges will exceed the current
straight-line expense incurred under AASB
117 Leases. This trend will reverse in the
later years.
There will be no change to the accounting
treatment for short-term leases less than
12 months and leases of low value items,
which will continue to be expensed on a
straight-line basis.
The Group is still evaluating the impact of
applying AASB 18 and intends to apply a
modified retrospective approach.
However, given the nature of operations
and current contracts the adoption of
AASB 16 is not expected to have a
material effect on the financial
statements.
All other pending Standards issued between the previous financial report and the current reporting dates have no
application to the Group.
Page 33
55
2018 Annual Report
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Notes to the Consolidated Financial Statements (continued)
Notes to the Consolidated Financial Statements (continued)
3.
Segment Reporting
Operating Segments
The Group has determined its operating segments based on the reports reviewed by the Chief Operating Decision
Makers (CODM) that are used to make strategic decisions regarding the Group’s operations. Due to the size and
nature of the Group, the Managing Director is considered to be the Chief Operating Decision Maker. The Group’s
primary reports are prepared to show the performance and financial position of different business segments which
can be distinguished by their risks and rates of return.
The CODM considers the business from functional and geographical perspectives and has identified that there are
two reportable segments being:
Mozambique – Mozambique – mineral exploration and evaluation and mine development activities
Australia – investing activities and corporate management
Segment Reporting
The segment information is prepared in conformity with the accounting policies adopted for the preparation of
financial statements of the Group. In presenting the information of the geographical segments, the segment assets
have been based on the geographic location of assets and segment expenses have been based on geographic
location of supplied goods and application of provided services to the group.
31 December 2018
Interest revenue
Mozambique
$
35,853
Australia
$
108,427
Total
$
144,280
Other segment income
-
316,825
316,825
Net foreign exchange gain/(loss)
(211,026)
443,391
232,365
Business development
Corporate and administration overhead
Fair value adjustment on equity securities
Total segment expenses
-
(540,422)
-
(540,422)
(1,769,320)
(5,452,543)
(174,350)
(7,396,213)
(1,769,320)
(5,992,965)
(174,350)
(7,936,635)
Reportable segment loss
(715,595)
(6,527,570)
(7,243,165)
Segment Assets
Cash
Exploration and evaluation
Mine development asset
Other (1)
Total segment assets
Mozambique
$
474,202
2,902,615
30,950,808
4,022,283
38,349,908
Australia
$
6,778,507
-
-
538,137
7,316,644
Total
$
7,252,709
2,902,615
30,950,808
4,560,421
45,666,553
(1) Other assets of the reporting segment “Mozambique” include the mine performance bond of $3,523,792 held with the Unico Bank.
Segment Liabilities
Creditors and other payables
Total segment liabilities
Mozambique
$
196,574
196,574
Australia
$
825,328
825,328
Total
$
1,021,902
1,021,902
Page 34
56
Battery Minerals Limited
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Notes to the Consolidated Financial Statements (continued)
Notes to the Consolidated Financial Statements (continued)
3.
Segment Reporting (continued)
Capital Expenditure during the year
Exploration and evaluation – Balama Project
Mine development asset – Montepuez Project
Plant & equipment and intangible assets
Total capital expenditure
31 December 2017
Interest revenue
Mozambique
$
1,055,005
22,537,517
65,222
23,657,744
Australia
$
-
-
166,113
166,113
Total
$
1,055,005
22,537,517
231,335
23,823,857
Mozambique
$
Australia
$
Total
$
-
36,341
36,341
Business Development
Corporate and administration overhead
Total segment expenses
-
(10,927)
(10,927)
(1,337,764)
(4,510,301)
(5,848,065)
(1,337,764)
(4,521,228)
(5,858,992)
Reportable segment loss
(10,927)
(5,811,724)
(5,822,651)
Segment Assets
Cash
Exploration and evaluation
Mine development asset
Other
Total segment assets
Segment Liabilities
Creditors and other payables
Total segment liabilities
4. Other Expenses
Office costs
IT Consultants and website
Subscriptions
Community support
Administrative operating costs
Exploration expenditure
Total other expenses
Mozambique
$
594,910
10,433,531
-
1,062,926
12,091,367
Australia
$
7,128,202
-
-
245,294
7,373,496
Mozambique
$
889,207
889,207
Australia
$
729,263
729,263
Consolidated
31 Dec 2018
$
305,378
184,528
109,955
167,321
128,053
-
895,235
Total
$
7,723,112
10,433,531
-
1,308,220
19,464,863
Total
$
1,618,470
1,618,470
Consolidated
31 Dec 2017
$
190,675
-
-
-
143,042
74,400
408,177
Page 35
57
2018 Annual Report
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Notes to the Consolidated Financial Statements (continued)
Notes to the Consolidated Financial Statements (continued)
5.
Income Tax
The income tax expense (benefit) for the year comprises current income tax expense (income) and deferred tax
expense (income). Current income tax expense charged to the profit or loss is the tax payable on taxable income
calculated using applicable income tax rates enacted, or substantially enacted, as at reporting date. Current tax
liabilities (assets) are therefore measured at the amounts expected to be paid to (recovered from) the relevant
taxation authority.
Deferred income tax expense reflects movements in deferred tax asset and deferred tax liability balances during the
period as well unused tax losses. Current and deferred income tax expense (income) is charged or credited directly
to equity instead of the profit or loss when the tax relates to items that are credited or charged directly to equity.
Deferred tax assets and liabilities are ascertained based on temporary differences arising between the tax bases of
assets and liabilities and their carrying amounts in the financial statements. Deferred tax assets also result where
amounts have been fully expensed but future tax deductions are available. No deferred income tax will be
recognised from the initial recognition of an asset or liability, excluding a business combination, where there is no
effect on accounting or taxable profit or loss.
Deferred tax assets and liabilities are calculated at the tax rates that are expected to apply to the period when the
asset is realised or the liability is settled, based on tax rates enacted or substantively enacted at reporting date. Their
measurement also reflects the manner in which management expects to recover or settle the carrying amount of
the related asset or liability. Deferred tax assets relating to temporary differences and unused tax losses are
recognised only to the extent that it is probable that future taxable profit will be available against which the benefits
of the deferred tax asset can be utilised.
Current tax assets and liabilities are offset where a legally enforceable right of set-off exists and it is intended that
net settlement or simultaneous realisation and settlement of the respective asset and liability will occur. Deferred
tax assets and liabilities are offset where a legally enforceable right of set-off exists, the deferred tax assets and
liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different
taxable entities where it is intended that net settlement or simultaneous realisation and settlement of the respective
asset and liability will occur in future periods in which significant amounts of deferred tax assets or liabilities are
expected to be recovered or settled.
(a)
Income tax expense
Current tax
Deferred tax
Consolidated
31 Dec 2018
$
Consolidated
31 Dec 2017
$
-
-
-
-
-
-
(b)
Reconciliation of income tax expense to prima facie tax
payable:
Loss before income tax
Prima facie income tax at 30% (27.5 in 2017FY)
Foreign tax rate differential
Non-deductable/taxable items - Australia
Non-deductable/taxable items – foreign operations
Income tax benefits not brought to account
Income tax expense/ (benefit)
(7,243,165)
(2,172,950)
(13,500)
415,629
18,144
1,752,677
-
(5,822,651)
(1,601,229)
-
1,183,729
-
417,500
-
58
Page 36
Battery Minerals Limited
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Notes to the Consolidated Financial Statements (continued)
Notes to the Consolidated Financial Statements (continued)
5.
Income Tax (continued)
Consolidated
31 Dec 2018
$
Consolidated
31 Dec 2017
$
3,483,184
2,865,670
220,894
6,569,748
1,733,276
2,899,586
184,209
4,817,071
(c)
Unrecognised deferred tax assets arising on timing
difference and losses
Carried forward tax losses - Australia
Carried forward tax losses – foreign operations
Other
Total
6.
Earnings per Share
Basic earnings per share
Basic earnings per share is calculated by dividing the loss attributable to owners of the Company, excluding any costs
of servicing equity other than ordinary shares, by the weighted average number of ordinary shares outstanding
during the financial year, adjusted for bonus elements in ordinary shares issued during the year.
Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into
account the after-income tax effect of interest and other financing costs associated with dilutive potential ordinary
shares and the weighted average number of shares assumed to have been issued for no consideration in relation to
dilutive potential ordinary shares.
The following reflects the income and share data used in the total operations basic and diluted earnings per share
computations:
Loss attributable to the owners of Battery Minerals Limited ($)
Basic loss per share attributable to equity holders (cents)
Consolidated
31 Dec 2018
Consolidated
31 Dec 2017
(7,243,165)
(5,822,651)
(0.763)
(1.330)
Weighted average number of ordinary shares used as the denominator in
calculating basic loss per share
Weighted average number of ordinary shares used in calculation of diluted
loss per share
948,706,481
436,897,632
948,706,481
436,897,632
Between the reporting date and the date of authorisation of these financial statements no additional securities were
issued that could potentially dilute basic loss per share in the future
7.
Dividends Paid or Proposed
No amount has been paid or declared by way of a dividend to the date of this report.
Page 37
59
2018 Annual Report
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Notes to the Consolidated Financial Statements (continued)
Notes to the Consolidated Financial Statements (continued)
8.
Cash and Cash Equivalents
For statement of cash flows presentation purposes, cash and cash equivalents includes cash on hand, deposits held
at call with financial institutions, other short-term highly liquid investments with original maturities of three months
or less that are readily convertible to known amounts of cash and which are subject to insignificant risk of changes
in value, and bank overdrafts.
Cash at bank and in hand
Consolidated
31 Dec 2018
$
7,252,709
7,252,709
Consolidated
31 Dec 2017
$
7,723,112
7,723,112
Cash at bank and in hand earns interest at floating rates based on daily bank rates. Refer to Note 19 (c) for
additional details on the impact of interest rates on cash and cash equivalents for the period.
9.
Other Receivables
Receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective
interest method, less an allowance for impairment.
Current
Prepaid expenses
GST receivable
Other receivables
Non-Current
Other receivables (1)
Consolidated
31 Dec 2018
$
Consolidated
31 Dec 2017
$
55,769
265,504
86,234
407,507
67,118
592,459
42,692
702,269
3,523,792
3,523,792
-
-
1 Non-current other receivables relate to the mine performance bond of $3,523,792 (MZN 152 million) kept on a deposit with the Unico Bank in
Mozambique.
The carrying amounts disclosed above represent their fair value.
60
Page 38
Battery Minerals Limited
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Notes to the Consolidated Financial Statements (continued)
Notes to the Consolidated Financial Statements (continued)
10.
Property, Plant & Equipment
Property, plant and equipment is stated at historical cost less depreciation. Historical cost includes expenditure that
is directly attributable to the acquisition of the items. Cost may also include transfers from equity of any gains or
losses on qualifying cash flow hedges of foreign currency purchases of property, plant and equipment.
Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only
when it is probable that future economic benefits associated with the item will flow to the Group and the cost of
the item can be measured reliably. The carrying amount of any component accounted for as a separate asset is
derecognised when replaced. All other repairs and maintenance are charged to profit or loss during the reporting
period in which they are incurred.
Depreciation on plant and equipment is calculated using the straight-line method or the units of production method
to allocate their cost or revalued amounts, net of their residual values, over their estimated useful lives or, in the
case of leasehold improvements and certain leased plant and equipment, the shorter lease. The depreciation rates
vary between 10% and 40%.
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting
period.
An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is
greater that it’s estimated recoverable amount. Gains and losses on disposals are determined by comparing
proceeds with carrying amount. These are included in profit or loss. When re-valued assets are sold, it is Group
policy to transfer any amounts included in other reserves in respect of those assets to retained earnings.
The majority of this plant and equipment forms part of the Montepuez project, being the cash generating unit tested
for impairment (refer to Note 14).
Plant and equipment at cost
Accumulated depreciation
Net carrying amount
Movements in carrying amounts
Balance at beginning of the year
Additions during the year
Reclassified to mine development
Depreciation expense
Foreign currency translation movement
Net carrying amount at the end of the year
Consolidated
31 Dec 2018
$
Consolidated
31 Dec 2017
$
758,796
(237,570)
521,226
752,491
(146,540)
605,951
Consolidated
31 Dec 2018
$
Consolidated
31 Dec 2017
$
605,951
205,075
(222,621)
(82,139)
14,960
521,226
225,266
411,278
(30,593)
-
-
605,951
Page 39
61
2018 Annual Report
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Notes to the Consolidated Financial Statements (continued)
Notes to the Consolidated Financial Statements (continued)
11.
Intangible Assets
Intangible assets with finite lives that are acquired separately are carried at cost less accumulated amortisation and
accumulated impairment losses. Amortisation is recognised on a straight-line basis over their estimated useful lives
that generally range between 3 and 5 years. The estimated useful life and amortisation method are reviewed at the
end of each reporting period, with the effect of any changes in estimate being accounted for on a prospective basis.
Intangible assets with indefinite useful lives that are acquired separately are carried at cost less accumulated
impairment losses.
Software at cost
Accumulated depreciation
Net carrying amount
Movements in carrying amounts
Balance at beginning of the year
Additions during the year
Depreciation expense
Consolidated
31 Dec 2018
$
Consolidated
31 Dec 2017
$
28,035
(4,672)
23,363
Consolidated
31 Dec 2018
$
Consolidated
31 Dec 2017
$
-
28,035
(4,672)
23,363
-
-
-
-
-
-
-
12.
Exploration and Evaluation Expenditure
Exploration and evaluation costs for each area of interest in the early stages of the project life are expensed as they
are incurred until they satisfy the requirements that are stated below.
Exploration and evaluation costs for each area of interest that are progressed to a pre-feasibility study (analysis of
potential mining project) are capitalised where right of tenure of the area of interest is current and they are expected
to be recouped through sale or successful development and exploitation of the area of interest or, where exploration
and evaluation activities in the area of interest have not at the end of the reporting period reached a stage that
permits reasonable assessment of the existence of economically recoverable reserves, and activities and significant
operations in, or in relation to, the area of interest are continuing.
When an area of interest is abandoned, or the directors decide that it is not commercial, any accumulated costs in
respect to that area are written off in the financial period the decision is made. Each area of interest is also reviewed
at the end of each accounting period and capitalised costs are written off to the extent that they will not be
recoverable in the future.
A regular review is undertaken of each area of interest to determine the appropriateness of continuing to carry
forward costs in relation to that area of interest.
Once technical feasibility and commercial viability of extraction of mineral resources in a particular area of interest
become demonstrable, the exploration and evaluation assets attributable to that area of interest are reclassified to
a mine development asset.
Government grants are recognised where there is reasonable assurance that the grant will be received, and all
attached conditions will be complied with. The research and development grant received by the Group relates to
capitalised exploration expenditure, as such it is recognised in the statement of financial position offset against
capitalised exploration expenditure.
Page 40
62
Battery Minerals Limited
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Notes to the Consolidated Financial Statements (continued)
Notes to the Consolidated Financial Statements (continued)
12. Exploration and Evaluation Expenditure (continued)
Non-Current
Exploration and evaluation at cost
Movement
Balance at beginning of the year
Exploration expenditure attributable to asset acquisition
Exploration expenditure capitalised during the year (1)
Option payment received for the Kroussou project
Research and development tax refund received (2)
Exploration expenditure written off during the year
Exploration expenditure disposed due to the Kroussou project sale
Reclassification to mine development (3)
Foreign currency translation movement
Closing exploration and evaluation net carrying amount (4)
Consolidated
31 Dec 2018
$
Consolidated
31 Dec 2017
$
2,902,615
10,433,531
10,433,531
-
2,390,506
-
(403,490)
-
(131,613)
(9,512,665)
126,346
2,902,615
5,854,955
257,537
3,884,793
(302,939)
(74,400)
-
813,585
10,433,531
(1) Capitalised exploration and evaluation expenditures includes costs in relation to both Montepuez and Balama Central Projects.
(2) The research and development (R&D) tax incentive provides a tax offset in the form of a refund, calculated with reference to expenditure on
eligible R&D activities.
(3) Reclassified exploration and evaluation expenditure relates to the Montepuez Graphite Project, which moved into the development phase.
(4) The closing balance mainly comprises the carrying amount of exploration and evaluation expenditure attributable to Balama Central Project
being $2,805,551.
13.
Mine Development Expenditure
Once technical feasibility and commercial viability of extraction of mineral resources in a particular area of interest
become demonstrable, the exploration and evaluation assets attributable to that area of interest are reclassified as
mine development.
Mine development represents the direct and indirect costs incurred in preparing mines for production and includes
plant and equipment under construction, stripping and waste removal costs incurred before production commences.
These costs are capitalised to the extent that they are expected to be recouped through the successful exploitation
of the related mining leases. Once production commences, these costs are transferred to Mine Properties or Plant
and Equipment, as relevant, and will be amortised using the units of production method based on the estimated
economically recoverable reserves to which they relate or are written off if the mine property is abandoned.
Development expenditure assets are assessed for impairment if an impairment trigger is identified. For the purposes
of impairment testing capitalised mine development assets are allocated to the cash generating unit (“CGU”) to
which the development activity relates.
Costs of site restoration and rehabilitation are provided over the life of the facility and are included in the capitalised
expenditure of that stage. Site restoration costs include the dismantling and removal of mining plant, equipment
and building structures, waste removal and rehabilitation of the site in accordance with clauses of the mining
permits. Such costs to be determined using estimates of future costs, current legal requirements and technology on
an undiscounted basis. Since at the end of December 2018 mine plant or building structures works didn’t
commenced there was no provision made for site restoration or rehabilitation.
Page 41
63
2018 Annual Report
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Notes to the Consolidated Financial Statements (continued)
Notes to the Consolidated Financial Statements (continued)
13.
Mine Development Expenditure (continued)
Non-Current
Mine development expenditure
Movement
Balance at beginning of the year
Mine development expenditure capitalised during the year
Reclassified from exploration and evaluation expenditure
Reclassified from property, plant and equipment
Foreign currency translation movement
Closing mine development net carrying amount
Assessment of Impairment
Consolidated
31 Dec 2018
$
Consolidated
31 Dec 2017
$
30,950,808
-
21,202,016
9,512,665
222,621
13,506
30,950,808
-
-
-
-
-
-
The Group assesses whether there are indicators that assets, or groups of assets, may be impaired at each reporting
date. The deficiency between net assets and the market capitalisation of the company was identified as an
impairment indicatory and accordingly, the Montepuez Graphite Project has been tested for impairment.
The Balama Project is currently in an exploration and evaluation stage and is assessed for impairment separately
under AASB 6 Exploration for and Evaluation of Mineral Resources. Based on the group’s review, there was no
impairment indication for the Balama Project (refer Note 12).
The Montepuez Graphite Project is considered a separate cash generating unit (CGU) and the group has made an
assessment of its recoverable amount. The recoverable value was estimated on a fair value less costs of disposal
basis using a discounted cash flow model prepared for the purposes of the project financing using market based
commodity prices, estimated quantities of recoverable ore, production levels, operating costs and capital
requirements sourced from the Group’s budgeting process and various independent studies that were
commissioned for project financing purposes. These external specialists were appointed to:
•
•
•
perform an independent technical due diligence of the project
provide pricing forecasts for the medium to long term period
update ore reserves in licence areas
Key assumptions contained in cash flow projections were:
•
•
forecast long term USD graphite pricing from external expert reports that were commissioned by the Group
inflation applied at 2.0% per annum for USA/Australian costs and revenues and 5% for Mozambique/South
Africa costs
steady state operations from mid-2020
using 30 years of cash flows. However, the mine plan can potentially extend to 50+ years with processing of
lower grade stockpiles for another 30 years;
a nominal post-tax discount rate
published reserve statements that were reviewed by the external specialist performing technical due
diligence
operating and capital cost estimates utilising mine and processing plans that were reviewed by the external
specialist performing technical due diligence
•
•
•
•
•
Based on the recoverable value estimated, no impairment was recognised for the Montepuez CGU.
The recoverable amount is highly sensitive to key assumptions. The effect of a reasonable possible change as at 31
December 2018, in the following key assumptions, in isolation to each other are detailed below:
64
Page 42
Battery Minerals Limited
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Notes to the Consolidated Financial Statements (continued)
Notes to the Consolidated Financial Statements (continued)
13.
Mine Development Expenditure (continued)
Assumptions
5% reduction in Blended commodity price forecast (1)
10% increase in production
10% increase in variable operating costs
10% increase in capital costs
5% increase in discount rate
Impact on recoverable amount,
$ million
(24)
17
(7)
(2)
(46)
(1) Blended commodity price forecast includes the average of three forecasters in the graphite industry: Benchmark Mineral Intelligence; Roskill
and CRU.
Whilst the impact of each reasonable possible change is shown in isolation, it is possible that a change in one key
assumption may be offset by a change in another key assumption.
14. Payables and Provisions
Trade and other payables
These amounts represent liabilities for goods and services provided to the Group prior to the end of the financial
year that are unpaid. The amounts are unsecured and are usually paid within 30 days of recognition. Trade and other
payables are presented as current liabilities unless payment is not due within 12 months from the reporting date.
They are recognised initially at their fair value and subsequently measured at amortised cost using the effective
interest method.
Provisions
Provisions are recognised when the Group has a present legal or constructive obligation as a result of past events, it
is probable that an outflow of resources will be required to settle the obligation and a reliable estimate can be made
of the amount of the obligation. Provisions are not recognised for future operating losses. Provisions are measured
as the present value of management’s best estimate of the expenditure required to settle the present obligation at
the end of the reporting period. The discount rate used to determine the present value reflects current market
assessments of the time value of money and the risks specific to the liability. The increase in the provision due to
the passage of time is recognised as an interest expense.
Employee benefits
Short term obligations
Liabilities for short-term employee benefits expected to be wholly settled within 12 months of the reporting date
are recognised in other payables 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.
Current
Trade and other payables
Accrued expenses
Provisions
Consolidated
31 Dec 2018
$
Consolidated
31 Dec 2017
$
606,905
203,339
211,658
1,021,902
813,639
804,831
-
1,618,470
Page 43
65
2018 Annual Report
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Notes to the Consolidated Financial Statements (continued)
Notes to the Consolidated Financial Statements (continued)
15.
Issued Capital
Ordinary shares are classified as equity.
Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net
of tax, from the proceeds. Incremental costs directly attributable to the issue of new shares or options for the
acquisition of a business are not included in the cost of the acquisition as part of the purchase consideration.
(a) Share capital
Ordinary shares fully paid
Movements in ordinary share capital
2018
01-Jan-2018
15-Jan-2018
15-Jan-2018
28-Mar-2018
29-Mar-2018
25-May-2018
02-Jul-2018
02-Aug-2018
Opening Balance
Share issue - Placement - Tranche 2 (1)
Share issue to contractors and staff (2)
Conversion of performance rights (3)
Share issue to contractor (4)
Share issue - Placement - Tranche 1 (5)
Share issue - Placement - Tranche 2 (5)
Share issue to contractor (6)
Less: Share Issue Costs
Movements in ordinary share capital
2017
1-Jan-2017
22-Jun-2017
29- Nov- 2017
29-Nov-2017
Opening Balance
Share issue- Balama licence
Share issue - Placement – Tranche 1
Less: Share Issue Costs
Consolidated
31 Dec 2018
$
Consolidated
31 Dec 2017
$
74,125,719
74,125,719
41,516,848
41,516,848
No. of Shares
532,028,113
222,362,362
9,141,821
3,500,000
672,307
183,681,689
160,866,645
1,418,612
-
1,113,671,549
Issue
Price
-
$0.060
$0.060
$0.058
$0.060
$0.060
$0.060
$0.031
-
Amount, $
41,516,848
13,341,743
548,509
203,000
40,339
11,020,901
9,654,830
44,076
(2,244,527)
74,125,719
No. of Shares
425,622,490
4,440,293
101,965,330
-
532,028,113
Issue
Price
$0.058
$0.060
-
Amount, $
35,545,134
257,577
6,117,920
(403,783)
41,516,848
(1)
(2)
(3)
(4)
(5)
(6)
Approved by the General Meeting of Battery Minerals Limited shareholders held on 5 January 2018.
Issue of ordinary shares to employees and contractors in lieu of salary and amounts payable for the provided services as part of Tranche 2
Placement approved by the General Meeting of Battery Minerals Limited shareholders held on 5 January 2018. The shares were issued to
Mitchell Group Holding Pty Ltd for $500,000 for the provision of drilling services and to staff members and consultants for the total of $48,509
for provision of consultancy services.
3,500,000 ordinary shares were issued to Cherie Ledeen on conversion of performance rights upon their vesting as approved by the
shareholders in 2016.
The ordinary shares were issued to Mitchell Group Holding Pty Ltd for the provision of drilling services as approved by the shareholders on 5
January 2018.
Shares Placement – Tranche 1 and 2 to sophisticated, professional and institutional investors as per approval by the General Meeting of Battery
Minerals Limited shareholders on 27 June 2018.
The ordinary shares were issued to Urbex Resources LLC for the provision of test work services as per the agreement signed by the parties on
19 December 2017.
66
Page 44
Battery Minerals Limited
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Notes to the Consolidated Financial Statements (continued)
Notes to the Consolidated Financial Statements (continued)
15.
Issued Capital (continued)
Ordinary shares entitle the holder to participate in dividends and proceeds on winding up of the Company in
proportion to the number of and amounts paid on the shares held.
On a show of hands every holder of ordinary shares present at a meeting in person or by proxy, is entitled to one
vote, and upon a pool each share is entitled to one vote. Ordinary shares have no par value and the Company does
not have a limited amount of an authorised capital.
(b) Options
Information relating to options over ordinary shares on issue, including details of options issued, exercised, lapsed
during the financial year and options outstanding at the end of the year is set in Note 16 and Note 22.
(c)
Capital risk management
The Group’s objectives when managing capital are to safeguard their ability to continue as a going concern, so that
they can continue to provide returns to shareholders and benefits for other stakeholders and to maintain an optimal
capital structure to reduce the cost of capital.
Due to the nature of the Group’s activities, being mineral exploration and development, the Group does not have
ready access to credit facilities, with the primary source of funding being equity raisings. Therefore, the focus of the
Group’s capital risk management is the current working capital position against the requirements of the Group to
meet exploration & evaluation programmes and corporate overheads. The Group’s strategy is to ensure appropriate
liquidity is maintained to meet anticipated operating requirements, with a view to initiating appropriate capital
raisings as required.
The working capital position of the Group at the end of the year is as follows:
Cash and cash equivalents
Current trade and other receivables
Current trade and other payables
16. Reserves
Foreign currency translation reserves
Consolidated
31 Dec 2018
$
Consolidated
31 Dec 2017
$
7,252,709
407,507
(1,021,902)
6,638,314
7,723,112
702,269
(1,618,470)
6,806,911
The foreign currency translation reserve comprises all foreign exchange differences arising from the translation of
the foreign controlled entities where their functional currency is different to the presentation currency of the
reporting entity. These foreign exchange differences are recognised in other comprehensive income as described in
Note 2. B and accumulated in a separate reserve account within equity. The cumulative amount is reclassified to
profit or loss when the net investment is disposed of.
Share-based payments reserve
The share-based payments reserve is used to recognise the fair value of options, contingent rights and performance
rights granted by the Company.
Page 45
67
2018 Annual Report
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Notes to the Consolidated Financial Statements (continued)
Notes to the Consolidated Financial Statements (continued)
16. Reserves (continued)
Reserves
Foreign currency translation reserve
Share- based payments reserve (1)
Consolidated
31 Dec 2018
$
Consolidated
31 Dec 2017
$
(151,879)
6,029,637
5,877,758
(433,881)
4,879,087
4,445,206
(1)
Share based payment reserve comprises options issued as share-based payments. Refer to Note 22 for more details.
Movements in share- based payments reserve
2018
Details
No. of Options &
Rights
01-Jan-18
15-Jan-18
15-Jan-18
15- Jan-18
04-Feb-18
28-Mar-18
21-Jun-18
27-Jun-18
28-Jun-18
30-Jun-18
02-Jul-18
02- Jul-18
04- Jul-18
04-Jul-18
31- Jul-18
15- Sep-18
30-Sep-18
08-Oct-18
31-Dec-18
31-Dec-18
Opening Balance
Tranche 1 & 2 options issued – Placement (1)
Unlisted options exercisable at $0.15 (2)
Unlisted options exercisable at $0.1125 (2)
Expiry unlisted options
Performance rights vested (3)
Unlisted options issued – Placement (4)
Options issued to directors (5)
Options issued to directors (6)
Forfeited options (7)
Options issued to employees (8)
Options issued to employees (9)
Expiry unlisted options
Listed options issued exercisable at $0.10 (10)
Expiry unlisted options
Forfeited options (11)
Expiry unlisted vested options (7)
Forfeited options (12)
Vesting expense of prior years’ options
Balance at end of year
70,400,000
334,141,820
7,800,000
7,800,000
(1,000.000)
(3,500,000)
91,840,796
7,500,000
20,000,000
(1,500,000)
24,400,000
11,250,000
(91,840,796)
172,274,066
(334,141,820)
(600,000)
(1,000,000)
(6,500,000)
-
307,324,066
Amount $
4,879,087
77,222
-
-
-
(203,000)
-
87,167
114,647
(14,938)
151,477
53,630
-
-
(77,222)
(3,724)
-
(37,742)
1,003,033
6,029,637
(1) Unlisted options were issued in accordance with the approval of the General Meeting of Battery Minerals Limited shareholders held on 5
January 2018. 101,965,330 options were issues as part of Placement Tranche 1 2017and 223,034,670 options were issued as part of Placement
Tranche 2 2018. One free attaching option exercisable at 10 cents on or before 31 July 2018 was issued for each New Share. 8,333,333 options
were issued to Mitchel Group for the provision of drilling services and 808,487 issued to two staff members in lieu of salary.
(2) Unlisted options were issued to the joint lead managers of the placement being 7,800,000 vesting in 6 months and 7,800,000 vesting in 18
months as approved by the General on 5 January 2018. Options were issued for nil consideration and will expire on 16 January 2021.
(5)
(3) 3,500,000 performance rights issued to Cherie Ledeen vested and were converted to ordinary shares.
(4) Unlisted options were issued to participants of the Tranche 1 Initial Placement, one free attaching option for every two shares issued, in
accordance with the approval of the General Meeting on 27 June 2018. The options are exercisable at 10 cents and expired on 4 July 2018.
Sign-on options were granted to Jeff Dowling (4,500,000) and Ivy Chen (3,000,000) exercisable at 13 cents, 50% vesting upon 12 months and
50% vesting upon 24 months of continuous service as approved by the General Meeting on 27 June 2018.
Zepo options were issued to David Flanagan in accordance with the approval of the General Meeting on 27 June 2018. Options vesting
conditions are linked to commencement of commercial production being 25% of Montepuez phase 1, 50% of Montepuez phase 2 and 25%
Balama stage 1. Options exercisable at nil price and will expire on 27 June 2023.
(6)
(7) 1,500,000 unvested options forfeited and 1,000,000 vested options expired upon resignation of Andy Cardoso.
(8)
Zepo options issued to employees in accordance with the ESOP plan approved by the General Meeting on 27 June 2018. Options have nil
exercise price subject to performance milestones and will expire on 13 July 2023.
Sign-on options were issued to employees in accordance with the ESOP plan approved by the General Meeting on 17 June 2018. 11,100,000
options are exercisable at 20 cents and 150,000 options exercisable at 15 cents. 3,275,000 options will vest on 12 months continuous services
and 7,975,000 will vest on commencement of Montepuez commercial production. All options expire on 16 July 2023.
Page 46
(9)
68
Battery Minerals Limited
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Notes to the Consolidated Financial Statements (continued)
Notes to the Consolidated Financial Statements (continued)
16. Reserves (continued)
(10) Listed options exercisable at 10 cents on or before 31 July 2023, issued for every two Placement Shares subscribed under the
Placement approved by the General Meeting on 27 June 2018.
(11) Unvested options forfeited upon resignation of Adriano Ouana.
(12) Unvested options forfeited upon resignation of Jeff Dawkins.
2017
Details
1 January 2017
7 January 2017
15 February 2017
31 March 2017
6 April 2017
8 April 2017
26 May 2017
26 May 2017
26 May 2017
30 November 2017
31 December 2017
31 December 2017
31 December 2017
31 December 2017
Opening Balance
Expiry listed options
Options issued to employees
Expiry unlisted options
Options issued to employees
Options issued to employees
Options issued to directors
Options issued to directors
Options issued to directors
Options forfeit
Expiry unlisted options
Vesting expense of prior year options
Vesting expense of prior year
performance rights
Balance at end of year
17. Accumulated Losses
Movement in accumulated losses
Balance at beginning of the year
Loss attributable to the owners of Battery Minerals Limited
18. Operating Cash Flow Reconciliation
Reconciliation of operating cash flows to operating loss:
Loss from ordinary activities after income tax
Adjustment for non-cash items:
Depreciation and amortisation
Fair value adjustment to equity securities
Share- based payments
Dissolution of subsidiary
Foreign currency (gain)/loss
Other
No. of Options &
Rights
111,954,396
(57,854,396)
1,500,000
(2,500,000)
2,500,000
1,000,000
10,000,000
5,000,000
3,000,000
(2,000,000)
(2,200,000)
-
-
Fair value, $
2,505,297
-
34,343
-
53,230
20,935
54,647
22,802
57,223
(28,821)
-
2,057,931
101,500
70,400,000
4,879,087
Consolidated
31 Dec 2018
$
Consolidated
31 Dec 2017
$
(28,115,661)
(7,243,165)
(35,358,826)
(22,321,829)
(5,793,832)
28,115,661
Consolidated
31 Dec 2018
$
Consolidated
31 Dec 2017
$
(7,243,165)
(5,822,651)
86,378
174,350
1,353,549
(258,883)
(123,633)
-
-
-
2,402,608
-
-
226
Page 47
69
2018 Annual Report
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Notes to the Consolidated Financial Statements (continued)
Notes to the Consolidated Financial Statements (continued)
18. Operating Cash Flow Reconciliation (continued)
Changes in operation assets and liabilities during the year:
(Increase)/decrease in trade and other receivables
Increase/(decrease) in trade and other payables
Net cash outflow from operating activities
19. Financial Risk Management
Financial Risk Management
Consolidated
31 Dec 2018
$
Consolidated
31 Dec 2017
$
337,265
(596,567)
107,629
(431,000)
(6,270,706)
(3,743,188)
The Group’s activities expose it to a variety of financial risks including foreign exchange risk, interest rate risk, credit
risk and liquidity risk. The Group’s overall risk management program focuses on the unpredictability of the financial
markets and seeks to minimise potential adverse effects on the financial performance of the Group. The Group uses
different methods to measure different types of risk to which it is exposed. These methods include sensitivity
analysis in the case of foreign currency and interest rate risks and ageing analysis for credit risk.
Risk management is carried out by the Board of Directors with assistance from suitably qualified external and internal
advisors as required. The Board provides written principles for overall risk management and further policies will
evolve commensurate with the evolution and growth of the Group.
These disclosures are not, nor are they intended to be an exhaustive list of risks which the Group is exposure to.
(a) Market risk
Market risk arises from Group’s exposure to interest bearing financial assets and foreign currency financial
instruments. It is a risk that the fair value of future cash flows of a financial instruments will fluctuate because of
changes in foreign exchange rates (currency risk), interest rates (interest rate risk) and share prices (price risk).
(b)
Foreign exchange risk
The functional currency of the Group is Australian dollars; however, the Group and the parent entity operate
internationally and are exposed to various currencies, primarily with respect to US Dollars (USD) and Mozambique
New Meticals (MZN).
The Group is exposed to foreign exchange risk arising from fluctuations of the Australian dollar against US dollar
(USD), EUR and South African Rand (ZAR) at parent level and fluctuations of the Australian dollar against MZN at
subsidiary level. Foreign exchange risk arises from future commercial transactions and recognised assets and
liabilities denominated in a currency that is not the entity’s functional currency and net investments in foreign
operations. The exposure to risks is measured using sensitivity analysis and cash flow forecasting.
The Group has not formalised a foreign currency risk management policy however, it monitors its foreign currency
expenditure in the light of exchange rate movements. The Group does not have any further material foreign
currency dealings other than the noted currencies.
The Group’s exposure to US Dollar foreign currency risk at the reporting date, expressed in Australian Dollars, was
as follows:
70
Page 48
Battery Minerals Limited
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Notes to the Consolidated Financial Statements (continued)
Notes to the Consolidated Financial Statements (continued)
19.
Financial Risk Management (continued)
Financial assets
Cash and cash equivalents
Total financial assets
Financial liabilities
Trade creditors and other payables
Total financial liabilities
AUD
1,056,204
1,056,204
(53,076)
(53,076)
The following conversion rates were used at the end of the financial year:
USD/AUD
0.7046
(2017: 0.7806)
Sensitivity analysis – change in foreign currency rates
The following table demonstrates the estimated sensitivity on assets and liabilities held in foreign currency at 31
December 2018 to a 10% increase/decrease in the USD/AUD exchange rates, with all variables held consistent, on
a post-tax profit or loss and equity. These sensitivities should not be used to forecast the future effect of movement
in the Australian dollar exchange rate on future cash flows.
Impact on post tax profits and equity
USD/AUD +10%
USD/AUD -10%
2018
$
2017
$
(91,193)
111,459
(43,248)
52,859
A hypothetical change of 10% in exchange rates were used to calculate the Group’s sensitivity to foreign exchange
rate movements as this is management’s estimate of possible rate movements over the coming year taking into
account currency market conditions and past volatility (2017: 10%).
(c)
Interest rate risk
Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of
changes in market interest rates. As at and during the year ended 31 December 2018, the Group had interest-bearing
assets in the form of cash and cash equivalents of $7,252,709 (2017: $7,723,112) and a mine performance bond of
$3,523,792 (2017: $nil). As such the Group’s operating cash flows are somewhat exposed to movements in market
interest rates due to the movements in variable interest rates on cash and cash equivalents.
The Group’s policy is to monitor the interest rate yield curve out to six months to ensure a balance is maintained
between the liquidity of cash assets and the interest rate return.
Sensitivity analysis – change in interest rates
Based on the financial assets held at reporting date, with all other variables assumed to be held constant, the table
below sets out the notional effect on consolidated profit or loss after tax for the year and on equity at reporting date
under varying hypothetical changes in prevailing interest rates.
Impact on post tax profits and equity
Hypothetical 80 basis points increase in interest
Hypothetical 80 basis points decrease in interest
2018
$
86,212
(86,212)
2017
$
77,231
(77,231)
The hypothetical movement in basis points for the interest rate sensitivity analysis is based on the currently observed
market environment (2017: 0.80%).
Page 49
71
2018 Annual Report
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Notes to the Consolidated Financial Statements (continued)
Notes to the Consolidated Financial Statements (continued)
19.
Financial Risk Management (continued)
The weighted average interest rate received on cash, cash equivalents and mine performance bond of the Group is
5.38% (2017: 0.492%)
(d)
Credit risk
Credit risk refers to the risk that counterparty will default on its contractual obligations resulting in financial loss to
the Group. The Group has adopted the policy of dealing 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
Group measures credit risk on a fair value basis. The Group does not have any significant credit risk exposure to a
single counterparty or any Group of counterparties having similar characteristics.
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 without taking account of the fair value of any collateral or
other security obtained.
Financial assets
Cash and cash equivalents
Other receivables
Non-current receivables
Total financial assets
2018
$
7,252,709
86,234
3,523,792
10,862,735
2017
$
7,723,112
-
-
7,723,112
The credit quality of financial assets that are neither past due nor impaired can be assessed by reference to external
credit ratings as follows:
Financial assets
Westpac Bank AA- rated
Mozambique banks BBB – rated (1)
Unrated
2018
$
6,794,337
3,982,164
86,234
10,862,735
2017
$
7,141,419
581,693
-
7,723,112
(1) Includes mine performance bond of MZN 152 million ($3.5 million equivalent) held with the Unico Bank in Mozambique.
(e)
Liquidity risk
Prudent liquidity risk management implies maintaining sufficient cash and marketable securities, the availability of
funding through an adequate amount of committed credit facilities and the ability to close out market positions.
The Group manages liquidity risk by continuously monitoring forecast and actual cash flows and matching the
maturity profile of financial assets and liabilities. As at the reporting date the Group had sufficient cash reserves to
meet its requirements.
The financial liabilities of the Group at reporting date were trade & other payables incurred in the normal course of
the business. These were non-interest bearing and were due within the normal 30-90 days terms of creditor
payments.
Less than
1 month
$
1-3 months,
$
3months -
1 year
$
No set
date of
repayment
Total
$
2018
Trade creditors & other payables
2017
Trade creditors & other payables
181,634
181,634
692,107
692,107
148,161
148,161
-
-
1,618,470
1,618,470
-
-
-
-
-
-
1,021,902
1,021,902
1,618,470
1,618,470
Page 50
72
Battery Minerals Limited
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Notes to the Consolidated Financial Statements (continued)
Notes to the Consolidated Financial Statements (continued)
19.
Financial Risk Management (continued)
(f)
Net fair value
Fair value estimation
The fair value of financial assets and financial liabilities held by the Group must be estimated for recognition and
measurement or for disclosure purposes. All financial assets and financial liabilities of the Group at the balance date
are recorded at amounts approximating their fair value. The fair value of financial instruments traded in active
markets is based on quoted market prices at the reporting date. The quoted market price used for financial assets
held by the Group is the current bid price.
Financial instruments measured at fair value
The financial instruments recognised at fair value in the statement of financial position are analysed and classified
using a fair value hierarchy reflecting the significance of the inputs used in the making the measurements. The fair
value hierarchy consists of the following levels:
• quoted prices in active markets for identical assets or liabilities (Level 1).
• inputs other than quoted process included within Level 1 that are observable for the asset or liability, either directly
(as prices) or indirectly (derived from prices) (Level 2).
• inputs for the asset or liability that are not based on observable market data (unobservable inputs) (Level 3).
The fair value of the financial assets not quoted in an active market has been determined with reference to the
amount at which the instrument could be exchanged in a current active market between willing parties, other than
in a forced or liquidation sale. The carrying value less impairment provision of trade receivables and payables are
assumed to approximate their fair values due to their short-term nature.
The total of each category of financial instruments, other than those with carrying amounts which are reasonable
approximations of fair value, are set out below:
Financial instruments – Level 1
Equity securities – carrying amount (1)
Equity securities – fair value amount (1)
2018
$
84,533
84,533
2017
$
-
-
(1) Equity securities comprise 10,566,636 listed securities issued by Trek Limited in 2018. The share price on acquisition 26 April 2018 was $0.025
and the fair value of the financial instrument recognised on acquisition was $258,883. These equity securities are held for trading and their
fair value movement is recognised through profit and loss. On 31 December 2018 the price Trek Limited share was $0.008. The reduction in
fair value of $174,350 was recognised through profit and loss at the reporting date.
20. Related Party Disclosure
Parent entities and subsidiaries
Battery Minerals Limited is the ultimate Australian parent entity.
Interests in subsidiaries are set out below:
Rio Mazowe Limited
Express Resources Pty Ltd
Index Resources Pty Ltd
Action Resources Pty Ltd
Jackal Resources Pty Ltd
Country of
Incorporation
Mauritius
Australia
Australia
Australia
Australia
% Equity
31 December
2018
% Equity
31 December
2017
100
100
100
100
100
100
100
100
100
100
Page 51
73
2018 Annual Report
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Notes to the Consolidated Financial Statements (continued)
Notes to the Consolidated Financial Statements (continued)
20.
Related Party Disclosure (continued)
Au Resources Pty Ltd
Skype Resources Pty Ltd
Select Exploration Limited
Tanga Resources Limited
Rovuma Resources Limited
Jorc Resources Limited
Assain Investments Limited
Greenstone Resources Limited
Niassa Metals SA
Suni Resources SA
Niassa Gold SA
Goldcrest Resources Sa
Peregrine Resources SA
Afriminas Minerais Limitada
Select Explorations Gabon SA
Country of
Incorporation
Australia
Australia
Mauritius
Mauritius
Mauritius
Mauritius
Mauritius
Mauritius
Mozambique
Mozambique
Mozambique
Mozambique
Mozambique
Mozambique
Gabon
% Equity
31 December
2018
% Equity
31 December
2017
100
100
nil (2)
100
100
100
100
100
100
100
100
100
100
100
nil (2)
100
100
100
100
100
100
100
100
100
100
100
100
100
90
901
(1)
(2)
This is direct equity interest. The balance of 10% for each respective subsidiary is held indirectly (on trust for the
Company) thus resulting in 100% ownership.
Sold to Trek Minerals Limited on 29 June 2018 refer to Note 24 for more details.
(a)
Key Management Personnel
The following persons were directors of Battery Minerals Limited during the financial year:
Director
Jeff Dowling
David Flanagan
Cherie Leeden
Gilbert George
Brett Smith
Paul Glasson
Ivy Chen
Position
Appointed
Non-Executive Chairman
Managing Director
Non-Executive Chairman
Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
25 January 2018
29 March 2017
11 October 2016
19 July 2013
1 August 2012
1 August 2012
19 April 2017
25 January 2018
Resigned
-
-
29 March 2017
25 January 2018
-
-
-
-
(b)
Other key management personnel
Name
Tony Walsh
Ben Van Roon
Jeff Dawkins
Andy Cardoso
Nick Day
Position
Company Secretary
Chief Operating Officer
Chief Financial Officer
Project Director
Chief Financial Officer
resigned 8 October 2018
resigned 30 June 2018
commenced 8 October 2018
74
Page 52
Battery Minerals Limited
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Notes to the Consolidated Financial Statements (continued)
Notes to the Consolidated Financial Statements (continued)
20.
Related Party Disclosure (continued)
(c)
Key management personnel compensation
Short-term employee benefits
Share based payments
Post-employment benefit
Total
(d)
Loans to key management personnel
Consolidated
31 Dec 2018
$
1,983,983
1,199,124
74,854
3,257,961
Consolidated
31 Dec 2017
$
1,369,976
2,127,428
-
3,497,404
There were no loans made or outstanding to directors of Battery Minerals Limited and other key management
personnel of the Group, including their personally related parties.
(e)
Other transactions with Key Management Personnel
There were no other transactions with Key Management Personnel other than share based payments (refer to Note
22).
21. Auditors’ Remuneration
Audit and review fees by BDO Audit (WA) Pty Ltd
Audit fees by BDO Mozambique
Audit and review by KPMG Australia
Audit fees by KPMG Mozambique
Tax and legal advisory services fees by KMPG Mozambique
Total remuneration for audit services
22.
Share-based payments
Consolidated
31 Dec 2018
$
Consolidated
31 Dec 2017
$
-
-
50,000
10,644
114,346
174,990
42,030
7,202
-
-
-
49,232
The Group provides benefits to employees (including directors) of the Group in the form of share-based payment
transactions, whereby employees render services in exchange for shares or rights over shares (‘equity-settled
transactions’). The cost of these equity-settled transactions with employees is measured by reference to the fair
value at the date at which they are granted. The fair value is determined by an internal valuation using a Black-
Scholes option pricing model and Monte Carlo methodology as appropriate.
The cost of equity-settled transactions is recognised, together with a corresponding increase in equity, over the
period in which the performance conditions are fulfilled, ending on the date on which the relevant employees
become fully entitled to the award (‘vesting date’).
The cumulative expense recognised for equity-settled transactions at each reporting date until vesting date reflects
(i) the extent to which the vesting period has expired and (ii) the number of options or performance rights that, in
the opinion of the directors of the Group, will ultimately vest. This opinion is formed based on the best available
information at balance date. No adjustment is made for the likelihood of market performance conditions being met
as the effect of these conditions is included in the determination of fair value at grant date. No expense is recognised
for awards that do not ultimately vest, except for awards where vesting is conditional upon a market condition.
Page 53
75
2018 Annual Report
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Notes to the Consolidated Financial Statements (continued)
Notes to the Consolidated Financial Statements (continued)
22.
Share-based payments (continued)
Where an equity-settled award is cancelled, it is treated as if it had vested on the date of cancellation, and any
expense not yet recognised for the award is recognised immediately. However, if a new award is substituted for the
cancelled award, and designated as a replacement award on the date that it is granted, the cancelled and new award
are treated as if they were a modification of the original award
(a)
Option Issue
The following table discloses the number of options issued in the form of share-based payments to directors and
employees:
Option
Recipient
A
B
C
D
E
F
G
Jeff Dowling
Ivy Chen
David Flanagan
Employees
Employees
Employees
Employees
Number of
Options
4,500,000
3,000,000
20,000,000
24,400,000
9,100,000
2,000,000
150,000
63,150,000
Issue Date
Vesting
Date
27/06/2018 Various (1)
27/06/2018 Various (1)
28/06/2018 Various (2)
2/07/2018 Various (3)
2/07/2018 Various (4)
2/07/2018 Various (5)
2/07/2018 Various (6)
Expiry Date
30/06/2023
30/06/2023
3/07/2023
13/07/2023
16/07/2023
16/07/2023
16/07/2023
Exercise
Price, $
0.13
0.13
nil
nil
0.20
0.20
0.15
Total Fair
Value, $
74,861
49,907
465,000
613,800
95,265
28,868
2,386
1,330,088
(1)
(2)
(3)
(4)
(5)
(6)
50% of options (3,750,000) will vest upon 12 months and 50% of options (3,750,000) will vest upon 24 months of continuous service after
appointment to the board of directors.
Options will vest upon the commencement of commercial productions of different stages: 25% (5,000,000) upon the Montepuez Graphite
project Stage 1, 50% (10,000,000) upon the Montepuez Graphite project Stage 2 and 25% (5,000,000) upon the Balama Central Graphite
project Stage 1.
50% of options (12,200,000) will vest upon the commencement of commercial production of the Montepuez Graphite project Stage 1 and
50% (12,200,000) will vest upon the commencement of commercial production of the Montepuez Graphite project Stage 2.
3,200,000 options will vest upon 12 months of continuous service by employees and 5,900,000 options will vest upon the commencement
of commercial production of the Montepuez Graphite project Stage 1.
2,000,000 options will vest upon the commencement of commercial production of the Montepuez Graphite project Stage 1.
75,000 options will vest upon 12 months of continuous service by employees and 75,000 will vest upon the commencement of commercial
production of the Montepuez Graphite project Stage 1.
Only the following options issued during the period were valued using Black-Scholes option pricing models with the
following inputs. The rest of the options issued with the nil exercise price were valued at the share market price on
the grant date.
Option
Recipient
Dividend
Yield
Expected
Volatility
(1)
Risk Free
Rate (2)
Expected
Life of
Options
Exercise
Price
Share Price
at Grant
Date
A
B
E
F
G
Jeff Dowling
Ivy Chen
Employees
Employees
Employees
-
-
-
-
-
100%
100%
100%
100%
100%
2.17%
2.17%
2.17%
2.17%
2.17%
5 years
5 years
5 years
5 years
5 years
$0.13
$0.13
$0.20
$0.20
$0.15
$0.03
$0.03
$0.03
$0.03
$0.03
FV per
option
$0.0166
$0.0166
$0.0144
$0.0144
$0.0144
(1) The expected volatility is based on historic volatility (based on remaining life of the options), adjusted for any expected chances to future
volatility due to publicly available information.
(2) Risk free rate is based on Australia 5-year bond yield rate.
76
Page 54
Battery Minerals Limited
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Notes to the Consolidated Financial Statements (continued)
Notes to the Consolidated Financial Statements (continued)
22.
Share-based payments (continued)
(b) Share options outstanding at the end of the year have the following terms and conditions:
2018
Grant Date
Expiry Date
Exercise
Price, $
FV per
security,
$
Balance at
start of year
Granted
during the
year
Exercised
during the
year
Number
Number
Number
Forfeited /
expired
during the
year
Number
Balance at
end of the
year
Number
Vested &
exercisable at
end of the
year
Number
15-Jan-15
16-Jan-15
30-May-16
31-May-16
21-Dec-16
21-Dec-16
21-Dec-16
21-Dec-16
21-Dec-16
21-Dec-16
21-Dec-16
4-Feb-18
5-Feb-18
30-May-20
30-May-18
21-Dec-21
21-Dec-21
21-Dec-21
21-Dec-21
21-Dec-21
21-Dec-21
21-Dec-21
0.26
0.001
0.26
0.010
0.09
0.00
0.10
0.15
0.20
0.25
0.15
0.15
0.15
0.036
0.058
0.093
0.087
0.082
0.078
0.086
0.086
0.086
333,333
666,667
2,500,000
3,500,000
5,000,000
5,000,000
5,000,000
5,000,000
10,000,000
3,000,000
4,400,000
21-Dec-16
21-Dec-21
0.15
0.086
3,000,000
1,500,000
2,500,000
1,000,000
10,000,000
5,000,000
3,000,000
15-Feb-17
6-Apr-17
8-Apr-17
26-May-17
26-May-17
26-May-17
27-Jun-18
27-Jun-18
27-Jun-18
27-Jun-18
27-Jun-18
27-Jun-18
27-Jun-18
23-Dec-21
22-May-22
22-May-22
26-May-22
26-May-22
26-May-22
30-Jun-13
30-Jun-13
3-Jul-23
13-Jul-23
16-Jul-23
16-Jul-23
16-Jul-23
0.15
0.20
0.20
0.94
0.20
0.13
0.13
0.13
0.00
0.00
0.20
0.20
0.15
0.064
0.060
0.059
0.046
0.038
0.042
0.017
0.017
0.031
0.031
0.014
0.014
0.014
-
-
-
3,500,000 (1)
-
-
-
-
-
-
-
-
666,667
333,333
-
-
-
2,500,000
-
5,000,000
-
5,000,000
-
5,000,000
-
-
5,000,000
- 10,000,000
3,000,000
-
4,400,000
-
-
-
2,500,000
-
5,000,000
5,000,000
5,000,000
5,000,000
-
3,000,000
4,400,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
- 3,000,000
3,000,000
1,500,000
-
-
2,500,000
-
1,000,000
- 10,000,000
5,000,000
-
3,000,000
-
4,500,000
-
-
3,000,000
- 20,000,000
19,800,000
4,600,000
6,600,000
2,500,000
2,000,000
-
150,000
-
500,000
-
-
-
-
1,500,000
-
-
-
-
-
-
-
4,500,000
3,000,000
20,000,000
24,400,000
9,100,000
2,000,000
150,000
(1)
3,500,000 performance rights issued to Cherie Ledeen vested and were converted to ordinary shares.
70,400,000
63,150,000
3,500,000
10,600,000 119,450,000
34,900,000
2017
Grant Date
Expiry Date
Exercise
Price, $
FV per
security, $
31- Mar- 14
29- Jul- 14
12 -Aug -14
15 -Jan -15
16 -Jan- 15
1- Apr -15
1 -Apr -15
30 -May- 16
31-May-16
21- Dec- 16
31 -Mar- 17
7- Jan- 17
7 -Jan- 17
4 -Feb- 18
5- Feb- 18
31 -Dec -17
31 -Dec -17
30- May- 20
30-May-18
21 -Dec -21
0.093
0.15
0.15
0.26
0.26
0.15
0.15
0.092
0.00
0.10
0.042
0.076
-
0.0013
0.01
0.026
0.026
0.0361
0.058
0.0929
Balance at
start of
year
Number
2,500,000
637,778
184,616
333,333
666,667
2,300,000
150,000
2,500,000
3,500,000
5,000,000
Granted
during the
year
Number
Exercised
during the
year
Number
Forfeited
during the
year
Number
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
2,500,000
637,778
184,616
-
-
2,300,000
150,000
-
-
-
Balance at
end of the
year
Number
-
-
-
333,333
666,667
-
-
2,500,000
3,500,000
5,000,000
Vested &
exercisable at end
of the year
Number
-
-
-
-
666,667
-
-
2,500,000
-
5,000,000
Page 55
77
2018 Annual Report
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Notes to the Consolidated Financial Statements (continued)
Notes to the Consolidated Financial Statements (continued)
22.
Grant Date
Share-based payments (continued)
Exercise
Price, $
FV per
security, $
Expiry Date
Balance at
start of year
Granted
during the
year
Exercised
during
the year
Forfeited
during the
year
Balance at
end of the
year
Number
Number
Number
Number
Number
21- Dec- 16
21 -Dec- 16
21 -Dec -16
21 -Dec- 16
21 -Dec- 16
21- Dec -16
21- Dec- 16
15 -Feb- 17
6 -Apr- 17
8 -Apr- 17
26 -May- 17
26 -May- 17
26 -May- 17
21- Dec- 21
21- Dec -21
21- Dec- 21
21- Dec- 21
21 -Dec- 21
21 -Dec- 21
21 -Dec -21
23 -Dec- 21
22 -May- 22
22- May- 22
26 -May- 22
26- May -22
26 -May- 22
0.15
0.20
0.25
0.15
0.15
0.15
0.15
0.15
0.20
0.20
0.94
0.20
0.13
0.0866
0.0818
0.0778
0.0861
0.0861
0.0861
0.0861
0.0636
0.0604
0.0588
0.0456
0.0380
0.0424
5,000,000
5,000,000
5,000,000
10,000,000
3,000,000
6,400,000
3,000,000
-
-
-
-
-
-
-
-
-
-
-
-
-
1,500,000
2,500,000
1,000,000
10,000,000
5,000,000
3,000,000
55,172,394
23,000,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
2,000,000
-
-
-
-
-
-
-
5,000,000
5,000,000
5,000,000
10,000,000
3,000,000
4,400,000
3,000,000
1,500,000
2,500,000
1,000,000
10,000,000
5,000,000
3,000,000
Vested &
exercisable at
end of the
year
Number
5,000,000
-
-
-
3,000,000
4,200,000
-
-
-
-
-
-
-
7,772,394
70,400,000
20,366,667
(c)
The expense recognised in profit and loss
The expense relating to share-based payments of $1,353,549 was recognised in 2018 (2017: $2,373,790).
23.
Parent Entity Disclosure
The following details information related to the parent entity, Battery Minerals Limited, as at 31 December 2018.
The information has been prepared on the same basis as consolidated financial statements.
Current assets
Non-Current assets
Total assets
Current liabilities
Total liabilities
Contributed equity
Share based payments reserve
Accumulated losses
Total equity
Company
31 Dec 2018
$
6,951,740
35,924,391
42,876,131
825,328
825,328
74,125,719
6,029,636
(38,104,551)
42,050,803
Profit/(loss) after income tax
Other comprehensive income/(loss) for the year
Total comprehensive income/(loss) for the year
(6,278,922)
-
(6,278,922)
Guarantees
Company
31 Dec 2017
$
7,236,779
8,062,789
15,299,568
729,263
729,263
41,516,848
4,879,086
(31,825,629)
14,570,305
(10,525,672)
-
(10,525,672)
The Parent Company has not entered into any guarantees in relation to the debts of its subsidiaries.
Contingent Liabilities and Contractual Commitments of the Parent
The Parent Company has no commitments to acquire property, plant and equipment and has no contingent liabilities
as at the date of this report.
Page 56
78
Battery Minerals Limited
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Notes to the Consolidated Financial Statements (continued)
Notes to the Consolidated Financial Statements (continued)
24.
Subsidiaries
Changes in ownership interests
A change in ownership interest results in an adjustment between the carrying amounts of the controlling and non-
controlling interests to reflect their relative interests in the subsidiary. Any difference between the amount of the
adjustment to non-controlling interests and any consideration paid or received is recognised in retained earnings
within equity attributable to owners of the Company.
When the Group ceases to have control of subsidiary, any retained interest in the entity is remeasured to its fair
value with the change in carrying amount recognised in profit or loss. The fair value is the initial carrying amount for
the purposes of subsequently accounting for the retained interest as an associate, jointly controlled entity or
financial asset.
In addition, any amounts previously recognised in other comprehensive income in respect of that entity are
accounted for as if the Group had directly disposed of the related assets or liabilities. This may mean that amounts
previously recognised in other comprehensive income are reclassified to profit or loss. If the ownership interest in a
subsidiary is reduced but joint control or significant influence is retained, only a proportionate share of the amounts
previously recognised in other comprehensive income are re-classified to profit or
loss where appropriate.
Recognition of Sale of Select
Battery Minerals Limited entered into a binding share sale agreement with Trek Minerals on 23 March 2018 to sell
100% of the issued capital of its Mauritian subsidiary, Select Exploration Ltd (Select), which holds 100% of Select
Exploration (Gabon) SA, which holds 100% of the Kroussou Project.
Battery Minerals recognizes the following estimated revenue and costs associated with the sale of Select to Trek
Minerals:
Transaction Element
Cash Consideration Received (USD 200,000 @ 0.7566)
10,566,636 shares in Trek Metals at A$0.022 per share
5,283,318 options of Trek Metals exercisable at A$0.10 on 27/04/2018
Deferred consideration (shares and NSR royalty) at fair value
Reimbursement of costs incurred by Trek Minerals (USD 23,490 @ 0.7571)
Net revenue on sale of Select
Dispose of investment in Select
Net gain on sale of Select and its Kroussou Project
Amount, $
264,320
232,466
26,417
-
(31,026)
492,177
(209,319)
282,858
Investment in Select Exploration Ltd represents the carrying amount of the net assets of the subsidiary.
The gain on disposal of Select and its Kroussou Project was recognised as profit for the year from discontinued
operations in the statement of profit or loss and other comprehensive income.
Page 57
79
2018 Annual Report
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Notes to the Consolidated Financial Statements (continued)
Notes to the Consolidated Financial Statements (continued)
Notes to the Consolidated Financial Statements (continued)
25.
Commitments and Contingent Liabilities
(a) Exploration and mining licences commitments
With respect to the Group’s mineral property interests in Mozambique, statutory expenditure commitments
specified by the mining legislation are nominal in monetary terms. However, as part of the licence application and
renewal requirements, the Group submits budgeted exploration expenditure. In assessing subsequent renewal
applications, the mining authorities review actual expenditure against budgets previously submitted. These amounts
do not become legal obligations of the Group and actual expenditure does vary depending on the outcome of the
actual activities.
The following shows the commitments for exploration and mining licences held by the Group:
Within one year
Later than one year but no later than five years
Consolidated
31 Dec 2018
$
682,022
-
682,022
Consolidated
31 Dec 2017
$
1,967,212
-
1,967,212
(b) Suppliers contract commitments
Based on the contracts signed with suppliers for the provision of services to the Montepuez Graphite Project the
following summarised the Group’s commitments to these suppliers:
Within one year
Later than one year but no later than five years
Consolidated
31 Dec 2018
$
Consolidated
31 Dec 2017
$
54,545
-
54,545
-
-
-
(c) Operating lease commitments
The Group leases three office premises under normal commercial terms. The leases are for periods between 1 and
3 years. The Group is under no obligation to renew lease once the lease term has expired.
Future minimum lease payments under non-cancellable operating leases are as follows:
Within one year
Later than one year but no later than five years
26. Events After the End of the Reporting Period
There are no events after the end of the Reporting Period to disclose.
Consolidated
31 Dec 2018
$
Consolidated
31 Dec 2017
$
122,005
46,956
168,961
-
-
-
80
Page 58
Battery Minerals Limited
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2018
Director’s Declaration
Directors’ Declaration
In the Directors’ opinion:
(a)
the financial statements, comprising the consolidated statement of profit or loss and other comprehensive
income, consolidated statement of financial position, consolidated statement of cash flows, consolidated
statement of changes in equity, and accompanying notes, are in accordance with the Corporations Act 2001, and:
(i)
(ii)
comply with Accounting Standards, the Corporations Regulations 2001 and other mandatory professional
reporting requirements; and
give a true and fair view of the financial position as at 31 December 2018 and of the performance for the
year ended on that date of the consolidated entity; and
(iii)
are in accordance with International Financial Reporting Standards issued by the International Accounting
Standards Board, as stated in Note 1 to the financial statements.
(b)
In the Directors’ opinion, there are reasonable grounds to believe that the company will be able to pay its debts as
and when they become due and payable.
The Directors have been given the declaration by the Managing Director and the Chief Financial Officer required by
section 295A of the Corporations Act 2001 (Cth).
This declaration is made in accordance with a resolution of the Board of Directors and is signed for and on behalf
of the directors by;
______________________
David Flanagan – Managing Director
Perth, Western Australia, 22 March 2019
Page 59
81
2018 Annual Report
Corporate Governance Statement
The Company’s corporate governance statement and Appendix 4G can be found on the Company’s website at www.batteryminerals.
com/about-us/corporate-governance
The Board of Directors (“the Board”) is responsible for the corporate governance of the Company. The Board guides and monitors the
business and affairs of the Company on behalf of the shareholders by whom they are elected and to whom they are accountable.
This statement outlines the main Corporate Governance practices in place throughout the financial year, which comply with the ASX
Corporate Governance Council’s Corporate Governance Principles and Recommendations with 2014 Amendments 3rd edition unless
otherwise stated.
The Company’s Corporate Governance Plan can also be found on the Company’s website at www.batteryminerals.com/about-us/
corporate-governance and it includes all of the Company’s Corporate Governance policies, charters and codes of conduct.
82
Battery Minerals Limited ASX Additional Information
Additional information required by the ASX Limited Listing Rules not disclosed elsewhere in this Financial Report is set out below.
1. Shareholdings
The issued capital of the Company as at 22 March 2019 is:
•
•
1,113,671,549 ordinary fully paid shares; and
172,274,066 listed options
All issued ordinary fully paid shares carry one vote per share.
2. Distribution of Equity Securities as at 22 March 2019
Ordinary Shares (ASX Code: BAT)
Holding Ranges
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 - 9,999,999,999
Totals
Unmarketable parcels
There were 686 holders of less than a marketable parcel of ordinary shares.
Listed Options (ASX Code: BATO)
Holding Ranges
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 - 9,999,999,999
Totals
Unmarketable parcels
There were 58 holders of less than a marketable parcel of listed options.
Holders
Total Units
% Issued
Share Capital
117
60
331
1,564
1,202
3,274
6,239
260,836
2,737,546
74,387,642
0.00%
0.02%
0.25%
6.68%
1,036,279,286
93.05%
1,113,671,549
100.00%
Holders
Total Units
% Issued
Share Capital
-
-
2
137
186
325
-
-
18,756
7,805,363
-
-
0.01%
4.53%
164,449,947
95.46%
172,274,066
100.00%
83
2018 Annual Report 3. Top 20 Largest Holders of Listed Securities as at 22 March 2019
Ordinary Shares
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
Holder Name
FARJOY PTY LTD
MITCHELL GROUP HOLDINGS PTY LTD
PACIFIC DEVELOPMENT CORPORATION PTY LTD
BNP PARIBAS NOMS PTY LTD
BT PORTFOLIO SERVICES LIMITED
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED - A/C 2
SKER HOLDINGS PTY LTD
CITICORP NOMINEES PTY LIMITED
RESOURCE & LAND MANAGEMENT SERVICES PTY LTD
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
BOUSSAL PTY LTD
MERRILL LYNCH (AUSTRALIA) NOMINEES PTY LIMITED
TRANSORE INTERNATIONAL (FZE)
SEGALS PTY LTD
BNP PARIBAS NOMINEES PTY LTD
MR RONALD ALBERT ATKINSON
IGNITION CAPITAL NO2 PTY LTD
MS CINDY & MR STUART PETER TONKIN
BERNE NO 132 NOMINEES PTY LTD <52293 A/C>
SYNTHAFIFAX PTY LTD
Total held by top 20 registered shareholders
Total issued capital - selected security class(es)
Listed Option Holders
Holder Name
FARJOY PTY LTD
MR NEIL WELSH
RESOURCE & LAND MANAGEMENT SERVICES PTY LTD
SKER HOLDINGS PTY LTD
PAN AUSTRALIAN NOMINEES PTY LIMITED
PACIFIC DEVELOPMENT CORPORATION PTY LTD
SEYMOUR GROUP PTY LTD
D M MIDDLETON PTY LTD
SAS INVESTMENTS PTY LTD
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
MR STEPHEN BERNARD PEART
CS FOURTH NOMINEES PTY LIMITED
NORTHCOVE INVESTMENTS PTY LTD
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED - A/C 2
BERNE NO 132 NOMINEES PTY LTD <52293 A/C>
MERRILL LYNCH (AUSTRALIA) NOMINEES PTY LIMITED
MR GRAEME KENNETH PERKES
MR DARRYL THOMAS AYRIS
MR GREGORY MILTS
CITICORP NOMINEES PTY LIMITED
Total held by top 20 registered option holders
Total issued capital - selected security class(es)
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
84
Holding
%
179,133,245
16.08%
27,044,381
25,000,000
23,598,431
20,000,000
18,481,361
17,000,000
16,729,261
12,500,000
11,551,340
10,000,000
7,875,291
7,687,311
7,000,000
6,380,006
5,504,700
5,500,000
5,000,000
5,000,000
4,997,492
2.43%
2.24%
2.12%
1.80%
1.66%
1.53%
1.50%
1.12%
1.04%
0.90%
0.71%
0.69%
0.63%
0.57%
0.49%
0.49%
0.45%
0.45%
0.45%
420,893,721
767,704,603
37.35%
100.00%
Holding
41,666,667
6,482,464
6,249,999
6,249,999
5,633,332
5,000,000
5,000,000
4,000,000
4,000,000
3,649,207
3,200,000
2,500,000
2,500,000
2,500,000
2,499,999
2,439,022
2,200,000
2,149,549
2,000,000
1,675,000
%
24.19%
3.76%
3.63%
3.63%
3.27%
2.90%
2.90%
2.32%
2.32%
2.12%
1.86%
1.45%
1.45%
1.45%
1.45%
1.42%
1.28%
1.25%
1.16%
0.97%
111,595,238
172,274,066
64.78%
100.00%
Battery Minerals Limited
ASX Additional Information (continued)
4. Voting Rights
All ordinary shares fully paid have the same voting rights of one vote per ordinary shares fully paid. See also the Company Constitution
and note 11 of the financial statements for further details.
Listed Options, unlisted incentive options and performance rights have no voting rights.
5. Unquoted securities
The names of the security holders holding more than 20% of an unlisted class of security are listed below:
Exercise Price
$.092
$0.10
$0.15
$0.20
$0.25
$0.20
$0.13
$0.20 $0.1125 $0.15
$0.94
$0.13
Various
sign-on
Expiry
31
May
2020
23
Dec
2021
23
Dec
2021
23
Dec
2021
23
Dec
2021
21
June
2022
21
June
2022
22
May
2022
16
Jan
2021
16
Jan
2021
16
Jan
2021
30
June
2023
16
July
2023
M = Millions
M
M
M
M
M
M
M
M
M
M
Zero
Zepo
30
June
2023
M
20
M
M
M
10
5.0
-
-
1.0
1.0
0.5
-
-
5.0
5.0
5.0
5.0
-
-
-
-
-
-
10.0
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
3.0
1.0
3.9
3.9
3.9
3.9
D Flanagan
C Leeden
G George
B Smith
Nardie Group PL
Jetosea PL
Sartori
Investments
G Fyfe
Berne No 132
Nominees
Zenix Nominees
I Chen
J Dowling
Total No of
holders
Holders < 20%
3
-
1
-
16
18.9
1
-
1
-
1
-
1
-
1
-
2
-
2
-
1
-
3.0
4.5
2
-
20+
19
11.25
24.4
Total
2.5
5.0
28.9
5.0
5.0
5.0
3.0
1.0
7.8
7.8
10
7.5
11.25
44.4
6. Substantial shareholder notices received as at 22 March 2019
Name
FARJOY PTY LTD
Number of Shares
% Holding
179,133,245
16.08%
7. Restricted Securities Subject to Escrow as at 22 March 2019
There are no shares subject to escrow.
85
2018 Annual Report ASX Additional Information (continued)
8. On-market buy back
There is currently no on-market buyback program for any of Battery Minerals Limited’s listed securities.
9. Group cash and assets
In accordance with Listing Rule 4.10.19, the Group confirms that it has been using the cash and assets for the year ended
31 December 2018 consistent with its business objective and strategy.
10. Tenure
The Company has an interest in the following projects as at 22 March 2019:
Mining Tenements Held
Tenement Reference
8770C
4118
8555
8609
Notes:
Location
Nature of interest
Interest
Mozambique
Granted Mining Licence
100%
Mozambique
Exploration License Granted
100%
Mozambique
Exploration License Granted
100%
Mozambique
Exploration License Granted
100%
1. As advised in the March 2017 Quarterly Report, the Company has agreed to dispose of its interest in the tenement numbered 5572 in Mozam-
bique. The transfer for the divestment of this tenement is currently being processed in Mozambique and is expected to be concluded in due
course. The transfer is subject to approval by the Government of Mozambique.
2. With respect to tenement’s 8555 & 8609, an agreement was reached in December 2018 to dispose of these tenements through the sale of the
Mauritian holding company which in owns 100% of the interest in the Mozambican company with title to these tenements. The agreement
reached between BAT, its subsidiaries and Nedeel LLC, foresees the sale of the tenements for $50,000 in cash and a 1% royalty (which may be
sold for US$1m up to the date of 730 days after the grant of a Mining Concession on either or both of the tenements). The change of ownership
of these tenements are subject to the approval of the Mozambican Government.
11. Competent Persons Statement
Battery Minerals confirms that it is not aware of any new information or data that materially affects the information included in the
original market announcements and that all material assumptions and technical parameters underpinning the estimates in the market
announcements continue to apply and have not materially changed. Battery Minerals confirms that the form and context in which
the Competent Person’s findings are presented have not been materially modified from the original market announcements. Battery
Minerals confirms that all the material assumptions underpinning the production targets for its Montepuez and Balama Central
graphite projects and any of the forecast financial information derived from these production targets, in the 4 and 12 December 2018
ASX announcements, on these projects continue to apply at the date of release of this presentation and have not materially changed.
Battery Minerals confirms that it is not aware of any new information or data that all material assumptions and technical parameters
underpinning the estimates in the 4 and 12 December 2018 announcements continue to apply and have not materially changed.
All references to future production and production & shipping targets and port access made in relation to Battery Minerals are subject to
the completion of all necessary feasibility studies, permit applications, construction, financing arrangements, port access and execution
of infrastructure-related agreements. Where such a reference is made, it should be read subject to this paragraph and in conjunction
with further information about the Mineral Resources and Ore Reserves, as well as the relevant competent persons’ statements.
Any references to Ore Reserve and Mineral Resource estimates should be read in conjunction with the competent person statements
included in the ASX announcements referenced in this report as well as Battery Minerals’ other periodic and continuous disclosure
announcements lodged with the ASX, which are available on the Battery Minerals’ website. For Mineral Resources - See announcement
dated 18th October 2018 for full details and Competent Persons sign-off. For Ore Reserves - See announcements dated 4 and 12
December 2018 for full details and Competent Persons sign-off.
The information in this report that relates to Battery Minerals’ Mineral Resources or Ore Reserves is a compilation of previously
published data for which Competent Persons consents were obtained. Their consents remain in place for subsequent releases by
Battery Minerals of the same information in the same form and context, until the consent is withdrawn or replaced by a subsequent
report and accompanying consent.
86
Battery Minerals Limited ASX Additional Information (continued)
Important Notice
This ASX Announcement does not constitute an offer to acquire or sell or a solicitation of an offer to sell or purchase any securities in
any jurisdiction. In particular, this ASX Announcement does not constitute an offer, solicitation or sale to any U.S. person or in the United
States or any state or jurisdiction in which such an offer, tender offer, solicitation or sale would be unlawful. The securities referred to
herein have not been and will not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”), and
neither such securities nor any interest or participation therein may not be offered, or sold, pledged or otherwise transferred, directly or
indirectly, in the United States or to any U.S. person absent registration or an available exemption from, or a transaction not subject to,
registration under the United States Securities Act of 1933.
Forward Looking Statements
Statements and material contained in this document, particularly those regarding possible or assumed future performance, resources
or potential growth of Battery Minerals Limited, industry growth or other trend projections are, or may be, forward looking statements.
Such statements relate to future events and expectations and, as such, involve known and unknown risks and uncertainties. Such
forecasts and information are not a guarantee of future performance and involve unknown risk and uncertainties, as well as other
factors, many of which are beyond the control of Battery Minerals Limited. Information in this presentation has already been reported to
the ASX.
All references to future production and production & shipping targets and port access made in relation to Battery Minerals are subject to
the completion of all necessary feasibility studies, permit applications, construction, financing arrangements, port access and execution
of infrastructure-related agreements. Where such a reference is made, it should be read subject to this paragraph and in conjunction
with further information about the Mineral Resources and Ore Reserves, as well as the relevant competent persons’ statements.
87
2018 Annual Report www.batteryminerals.com
88
Battery Minerals Limited www.batteryminerals.com
I
i
n
s
g
h
t
i
C
o
m
m
u
n
c
a
t
i
o
n
&
D
e
s
g
n
i