2019
Annual Report
CONTENTS
Operations Update……………………………………………………………………….2
Financial Report…………………………………………………………………………14
Corporate Governance Statement…………………………………………………….77
ASX Information…………………………………………………………………………78
Page 1
Operations Update
BACKGROUND INFORMATION ON BATTERY MINERALS
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 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 over 80% of Montepuez’s forecast annual
production. In H1 FY2018, the Mozambican Government granted Battery Minerals a Mining
Licence and has also approved the Company’s Environmental Impact Assessment (EIA) for
the Montepuez Graphite Project.
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).
Combined with Montepuez and subject to continued positive economic, social and technical
investigations, Balama Central provides scope for self-funded growth from a ~50,000tpa
production-rate to at least 150,000tpa.
On 2 March 2020 Battery Minerals announced that it had signed a binding agreement to
acquire a controlling interest in Gippsland Prospecting which has the sole right to apply for a
highly prospective exploration licence in Victoria, Australia. A shareholder meeting to approve
the transaction is scheduled for mid-April 2020.
Figure 1 - Montepuez and Balama Central Graphite Projects in the Province of Cabo Delgado in northern Mozambique.
Page 2
Operations Update
MONTEPUEZ GRAPHITE PROJECT:
Ore Reserve Highlights:
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)
Total Mineral Resource
Type
Tonnes
Mt
TGC
%
Cont. Graphite
kt
Oct 18 Historical Oct 18 Historical
Weathered
Primary
Total
10.3
109.2
119.6
13.0
92.9
105.9
7.7
8.1
8.1
7.9
7.7
7.7
Oct 18
790
8,870
Historical
998
7,066
9,660
8,064
Note: See announcement dated 18 October 2018 for full details and Competent Persons sign-off
Ore Reserve - December 2018
During December 2018, Battery Minerals announced a significant increase in Ore Reserves
at its Montepuez Graphite Project in Mozambique.
Deposit
TOTAL
Montepuez Graphite Project November 2018 Ore Reserve Estimate
TGC (%)
Ore type
Ore (Mt)
Class
Weathered
Fresh
TOTAL
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 Mine Layout and Design
Pit designs 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 Measured and Indicated Resources for 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.
Each pit will have a single waste dump, located to the east of each excavation. Pit ramps will
be orientated 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.
Page 3
Operations Update
Figure 2 - Montepuez Graphite Project: Mine & Processing Site Layout.
Economics - CAPEX and OPEX - December 2019
During the December 2019 Quarter, Battery Minerals announced an improvement in the
Montepuez Graphite Project’s economics. The total estimated pre-production establishment
capital cost outstanding for the project is US$44.7M, which includes contingency and
escalation, and the average operating cost for the first 10 years was reduced to US$356/t from
US$361/t (FOB Pemba) as detailed below:
CAPEX
Area
Process Plant and Power
Mining Equipment and Light Vehicles
Earthworks, Tailings Storage Facility and Water Storage
Buildings, officers and workshops
Owners costs
Pre-production Costs
Freight
Total
Remaining
Capex
USD$M
27.4
4.0
0.7
2.6
3.7
4.5
1.8
44.7
Note: Capex excludes other costs associated with debt, including fees and advisory costs, DSRA and debt
security requirements, VAT and overhead in aggregate, approximately US$19.8M.
The average C1 operating cost summary (FOB Pemba) for the project for the first 10 years is
detailed below:
Page 4
Operations Update
OPEX for years 1 to 10
Mining
Processing
General and Administrative
Logistics
Maintenance
Total C1 cost (FOB Pemba)
USD$ pa
5,129,000
5,692,000
2,545,000
3,082,000
1,532,000
17,980,000
USD$/t conc
100
114
47
62
33
356
Notes: 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
3) C1 costs exclude Mozambique corporate and stockpile costs
Statutory Agreements
In March 2018, Battery Minerals secured a Mining Licence for its Montepuez Graphite Project.
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,
exports and cashflows. The execution of a Mining Agreement is a right enshrined in the mining
law that enables investing companies to obtain absolute clarity around the application of the
legal framework to the project. The Mining Agreement also formalises the project’s fiscal
stability rights into a contractually binding document and provides an agreed dispute resolution
process.
During 2019, Battery Minerals continued to progress government engagement in relation to
the Mining Agreement. As previously advised, the Company does not expect a material
variation in project economics to result from the Mining Agreement.
Downstream Product Development
The Company continues to progress its downstream purification and spheroidization strategy
with our technology partner, Urbix Resources, based in Arizona, USA. Key achievements
through 2019 include;
• Montepuez graphite concentrate, purified with Urbix technology and used in a USA
Department of Energy grant funded nuclear graphite research study1
• Urbix produces high purity, spherical graphite, with high recoveries and no
morphological flake damage using their propriety non-HF acid technology from the
Montepuez concetrate2
• The Company signed a Memorandum of Understanding with Urbix with the aim of
establishing a joint venture in Mozambique to produce high purity graphite products
using the Urbix environmentally friendly purification technology3
1
2
3
Refer Battery Minerals March 2019 Quarterly Activities Report, announced on 29 April 2019
Refer Battery Minerals June 2019 Quarterly Activities Report, announced on 9 July 2019
Refer Battery Minerals September 2019 Quarterly Activities Report, announced on 24 October 2019
Page 5
Operations Update
BALAMA CENTRAL GRAPHITE PROJECT:
Feasibility Study December 2018
In December 2018, Battery Minerals reported that a Feasibility Study on its second proposed
graphite project in Mozambique, Balama Central, based on graphite forecasts at that time
would support a 27+ year mine life at a production rate of 58,000tpa *.
Key Balama Central Feasibility Study findings
Feasibility Study findings**
Annual production at run of mine (ROM) ore at an
average rate of 480,000tpa at over 12.2% TGC
58,000t of +96% TGC graphite concentrate
Capex (pre-production)
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
*- Based on Ore Reserves (see ASX released dated December 2018)
**- Feasibility Study findings (+15%/-5%) as at December 2018
Figure 3 - Infrastructure map showing the Balama Central Graphite Project relative to Montepuez and the nearest
deep-water port of Pemba
Page 6
Operations Update
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 Lennox and Byron 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 90 metres, whilst the current design for Byron pit extends to a depth
of approximately 135 metres deep. Each pit will have a single waste dump, located to the
east and west 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.
Balama Central Graphite Project: Mineral Resource Estimate March 2018
Total Mineral Resource
Type
Weathered
Primary
Total
Tonnage
Mt
7.4
25.6
33.0
TGC
%
10.7
10.1
10.2
Cont. Graphite
Kt
790
2,573
3,363
Note: See announcement dated 29 March 2018 for full details and Competent Persons sign-off
Page 7
Operations Update
Balama Central Graphite Project: Ore Reserve Estimate December 2018
Pit
Total
Ore type
Weathered
Fresh
Total
Class
Probable
Probable
Probable
Ore (Mt)
5.44
14.21
19.66
TGC (%)
10.74
11.19
11.06
Note: See announcement dated 12 December 2018 for full details and Competent Persons sign-off
Mining and ESIA Licence Applications
The Company submitted an application for the Balama Central Mining Licence in
June 2019 to the Government for its review and consideration.
The outcomes of the social impact study included in the mining concession
application are an important part of the application and can be summarised as
follows:
• Economic opportunities, with both direct and indirect opportunities created
• Employment benefits resulting in an increase in the skills base in the area
•
Improved Infrastructure with upgraded roads improving access to markets and
access to educational and medical infrastructure
• Social development benefits with initiatives outlined such as supporting food
security, outreach health services, and improved educational facilities and
training, all of which will improve the quality of life of communities in the impact
zone
In December 2019 an application was made to the Department of Environment for the
approval of the Balama Central Project Environmental Licence.
The outcomes of the environmental and social impact study can be summarised as follows:
• No significant environmental threats. Government recommendations were within the
project’s plans and budgets
• Economic opportunities, with both direct and indirect opportunities created
• Employment benefits resulting in an increase in the skills base in the area
•
Improved Infrastructure with upgraded roads improving access to markets and access to
educational and medical infrastructure
• Social development benefits with initiatives outlined such as supporting food security,
outreach health services, and improved educational facilities and training, all of which will
improve the quality of life of communities in the impact zone
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
Deposit
Montepuez
Balama Central
Elephant
Buffalo
Lennox
Byron
Total
Tonnes
Mt
6.6
3.7
4.8
2.6
17.7
TGC
%
7.0
8.7
10.9
10.4
8.9
Cont. Graphite
kt
460
330
520
270
1,580
Page 8
Operations Update
Group Total Mineral Resource - Primary
Project
Deposit
Montepuez
Balama Central
Elephant
Buffalo
Lennox
Byron
Total
Tonnes
Mt
70.3
38.9
17.2
8.4
134.8
TGC
%
7.3
9.6
10.0
10.2
8.5
Cont. Graphite
kt
5,150
3,720
1,720
850
11,440
Group Total Mineral Resource
Project
Montepuez
Deposit
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
Tonnes
Mt
76.9
42.6
21.9
11.0
152.5
TGC
%
7.3
9.5
10.2
10.2
8.5
Elephant
Buffalo
Lennox
Byron
Total
Balama Central
Group Ore Reserve Statement
Battery Minerals Group Probable Ore Reserves
Grade %
TGC
11.06
19.66
Mt
2.17
Contained Graphite Mt
42.19
61.9
9.27
10.1
3.91
6.08
Project
Balama1
Montepuez2
Total
Notes: 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
MAIDEN VANADIUM RESOURCE
On 29 April 2019, the Company announced an Inferred Resource for vanadium of 34.6Mt at
0.25% V2O5 from within the existing Ore Reserve pit designs of the Montepuez Graphite
Project (Elephant and Buffalo).
Vanadium is an important ingredient in high quality steel production and is growing in
relevance in large commercial scale battery production.
Page 9
Operations Update
MONTEPUEZ GRAPHITE PROJECT - Buffalo and Elephant Deposit
April 2019 Inferred Vanadium Mineral Resource Estimate
(4.3% TGC Cut-off, within Ore Reserve pit design)1
Type
Tonnage (Mt)
V2O5 (%)
Cont. V2O5 (Kt)
Buffalo Graphite Deposit
Primary
Total Buffalo
16.2
16.2
Elephant Graphite Deposit
Primary
Total Elephant
TOTAL
18.4
18.4
34.6
0.25
0.25
0.24
0.24
0.25
41
41
45
45
86
1, See announcement of 29 April 2019 for full details of the Inferred Resource & the competent person statement
GIPPSLAND
Agreement to acquire a controlling interest in Gippsland Prospecting
On 2 and 16 March, 2020, Battery Minerals announced that it had signed two binding
agreements to acquire 100% of Gippsland Prospecting Pty Ltd (“Gippsland Prospecting), which
has the sole right to apply for a higher-prospective exploration licence immediately adjacent to
Stavely Minerals (ASX:SVY) Thursday’s Gossan copper-gold project in Victoria.
Known as Block 4, the tenement covers 809sqkm and hosts the historic Moyston gold mine,
which produced 75,000oz at 22g/t Au. The exploration licence is also just 7km from the rich
Stawell gold mine, which has produced 5Moz of gold. Gippsland Prospecting won the Victorian
Government tender, which gave it the sole right to apply for the exploration licence.
Battery Minerals will pay the 3 shareholders of Gippsland Prospecting $500,000 in aggregate and
issue them 439,363,850 shares in aggregate in return for 100 per cent of Gippsland Prospecting.
Block 4 will be renamed E67801 on grant of the exploration licence (see full details below).
The acquisition is subject to the approval of Battery Minerals shareholders and the grant of the
exploration licence - E67801.
Under the terms of the agreement, Gippsland Directors Kent Balas and Darryl Clark, who are
both exploration geologists, will become Directors of Battery Minerals.
Block 4 is considered highly prospective for shear zone-hosted Orogenic gold deposits such as
Stawell, as well as volcanic-hosted base metals mineralisation and large-scale Cadia Ridgeway-
type porphyry copper mineralisation, within the well defined Stavely volcanic belt.
The adjoining Stavely tenement hosts the Thursday’s Gossan porphyry copper-gold discovery
(see Stavely ASX release “AGM Presentation release dated 29th November 2019 and Stavely
ASX release dated 25 February 2020). Stavely has reported high-grade copper intersections
and stated that the mineralisation remains open along strike and down dip.
Material terms
The material terms of the acquisition agreement are:
•
•
•
Battery Minerals will acquire 67% of the shares in Gippsland Prospecting Pty Ltd, the
owner of 100% of Block 4.
Subject to shareholder approval, Battery Minerals will issue 294,373,780 ordinary
shares and pay up to $335,000 to the 2 shareholders of Gippsland Prospecting Pty Ltd
as consideration.
Subject to shareholder approval, Battery Minerals will issue to the remaining
Page 10
Operations Update
that owns 33% of Gippsland Prospecting, a consideration of
shareholder
144,990,070 ordinary shares and $165,000.
Battery Minerals has agreed to spend a minimum of $1.5 million on exploration and
evaluation on Block 4 in the first 12 months after completion of the transaction.
On completion of the transaction, Mr Kent Balas and Dr Darryl Clark will join the Battery
Minerals Board, and Mr Balas will be appointed as Managing Director of Battery
Minerals.
Subject to shareholder approval, Battery Minerals will issue the new members of the
management and consulting team 70 million Zepo incentive 5-year options where
vesting is subject to clear performance targets, being the definition of mineral
resources, ore reserves and commencement of mining.
In addition, Battery Minerals will repay Gippsland Prospecting shareholder loans
of ~$250,000 for past expenditure.
•
•
•
•
Shareholder approval is expected to be sought in April 2020.
Figure 5 - Location of Block 4 adjacent to Stawell historic mine and Stavely tenure showing locations of key regional
prospects and deposits
Page 11
Operations Update
For further information and competent person sign-offs, please see Battery Minerals
announcements dated 2 and 16 March 2020.
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.
The information in this Report that relates to Montepuez Mineral Resources is extracted from the ASX Announcement titled
‘Group Resource Update’ dated 18 October 2018, where the Statement of Estimates of Mineral Resources was compiled by Mr.
Shaun Searle who is a Member of the AIG. Mr. Searle has sufficient experience that is relevant to the style of mineralisation and
type of deposit under consideration and to the activity that he has undertaken to qualify as a Competent Person as defined in the
JORC Code (2012). Mr Searle consented to the inclusion in that report of the matters based on his information in the form and
context in which it appears.
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.
Page 12
Operations Update
Appendix 1: Tenement Summary - 31 December 2019 1
1. TENEMENTS HELD
Tenement
Reference
8770C
10031C
8555
8609
Location
Nature of interest
Mozambique
Mining Licence Granted
Interest at
beginning of
Quarter
100%
Mozambique
Mozambique
Mining Concession in
Application
Exploration Licence Granted
Mozambique
Exploration Licence Granted
100%
100%
100%
Interest at end of
Quarter
100%
100%
100%
100%
Note 1: The Balama Central graphite project mining concession application was lodged with government in late June 2019. The
application process is expected to conclude in 2020.
Note 2: With respect to tenement’s 8555 & 8609, an agreement was reached in December 2018 to dispose of these tenements.
The agreement reached between BAT, its subsidiaries and Nedeel LLC, was 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 is currently subject to the approval of the Mozambican Government.
Community Investment
The Company works closely with local Government and community leaders on specific
community initiatives including local employment and training, supporting medical and
educational facilities and services such as schooling and clinic infrastructures and increasing
access to safe water. Once the Company achieves project finance and commences
development and then production, the Company will further expand its planned long term
locally supported and government endorsed community initiatives.
Page 13
Battery Minerals Limited
and its Controlled Entities
ABN 75 152 071 095
Financial Report
31 December 2019
Page 14
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Contents
Corporate Information ................................................................................................................................................................. 16
Directors’ Report .......................................................................................................................................................................... 17
Auditor’s Independence Declaration ........................................................................................................................................... 35
Independent Auditor’s Report ..................................................................................................................................................... 36
Consolidated Statement of Profit or Loss and Other Comprehensive Income ............................................................................ 41
Consolidated Statement of Financial Position.............................................................................................................................. 42
Consolidated Statement of Cash Flows ........................................................................................................................................ 43
Consolidated Statement of Changes in Equity ............................................................................................................................. 44
Notes to the Consolidated Financial Statements ......................................................................................................................... 45
Directors’ Declaration .................................................................................................................................................................. 76
Page 15
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Corporate Information
This financial report includes the consolidated financial statements and notes of Battery Minerals Limited and its controlled
entities (“the Group”). The Group’s presentation currency is AUD ($).
A description of the Group’s operations and of its principal activities is included in the review of operations and activities in
the Directors’ report on pages 17 to 34. The Directors’ report is not part of the financial report.
4 BAuditors
KPMG
235 St. Georges Terrace
Perth WA 6000
5 BBankers
Westpac Banking Corporation
Level 13, 109 St Georges Tce
Perth WA 6000
6 BSolicitors
DLA Piper Australia
Level 31, Central Park
152-158 St Georges Terrace
Perth WA 6000
7 BStock Exchange
Australian Securities Exchange Limited
Level 40, Central Park
152-158 St George's Terrace
Perth WA 6000
ASX Code: BAT
Share Registry
Automic Registry Services
Level 2, 267 St Georges Terrace
Perth WA 6000
T: 1300 288 664
0 BDirectors
David Flanagan
Non-Executive Chairman
(appointed 1 July 2019)
Jeremy Sinclair
Non-Executive Director
(appointed 22 November 2019)
Managing Director
(resigned 22 November 2019)
Jeff Dowling
Non-Executive Director
(appointed 8 April 2019)
Ivy Chen
Non-Executive Director
(resigned 21 June 2019)
Paul Glasson
Non-Executive Director
(resigned 21 June 2019)
Gilbert George
Non-Executive Director
(resigned 21 May 2019)
Brett Smith
Non-Executive Director
(resigned 21 May 2019)
1 BCompany Secretary
Tony Walsh
Nick Day
2 BRegistered Office
Ground Floor, 10 Ord Street
West Perth WA 6005
3 BWebsite
https://www.batteryminerals.com/
Page 16
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
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 2019.
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
Executive Chairman
Managing Director
Executive Chairman
Non-Executive Chairman
Non-Executive Director
Managing Director
Non-Executive Director
Non-Executive Chairman
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Appointed
1 July 2019
8 April 2019
25 January 2018
30 March 2017
11 October 2016
22 November 2019
8 April 2019
8 April 2019
25 January 2018
1 August 2012
1 August 2012
19 April 2017
25 January 2018
Resigned
-
1 July 2019
8 April 2019
25 January 2018
30 March 2017
-
22 November 2019
-
8 April 2019
21 May 2019
21 May 2019
21 June 2019
21 June 2019
Director
David Flanagan
Jeremy Sinclair
Jeff Dowling
Gilbert George
Brett Smith
Paul Glasson
Ivy Chen
Dividends
No dividends were paid during the financial year (31 December 2018: 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. During the year, the Company has maintained 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 concentrate, 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 concentrate and grow production towards over 200,000tpa
over the next five years.
While continuing to pursue cost effective financing options for the graphite projects, the Company has identified a
complimentary exploration project at Gippsland in Western Victoria. The Gippsland Project is host to significant strike
length of the Stavely Volcanics, the Moyston shear and the Miga Arc all considered prospective for base metals and gold in
the region.
b. Highlights & Significant Changes in State of Affairs
Placement: A $5m fund raising was successfully completed in May 2019.
Montepuez Project Vanadium Resource: On 29 April 2019 Battery Minerals announced a maiden vanadium resource of
34.6Mt at 0.25% V2O5 for 86Kt of contained Vanadium Pentoxide.
Page 17
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Directors’ Report (continued)
Likely Developments and Expected Results
The Group will continue to focus on completing project finance to develop and bring the Montepuez 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 focus on becoming a
successful production company in the graphite market.
In addition, the Company intends to seek shareholders’ approval of its Gippsland Project acquisition in Western Victoria,
obtain the grant of the initial exploration licence and actively pursue discoveries in the area.
The Group’s long-term strategic objective is to develop its graphite projects, grow production to 200,000 tonnes of graphite
concentrate per annum, pursue the discovery and development of complimentary battery mineral exploration projects,
ensure all activities are carried out in a transparent and responsible way and 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 the Company’s current strategy.
•
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 organizational activities on the
environment. There have been no known breaches by the Group during the year.
After Reporting Date Events
In March 2020 Battery Minerals Limited signed two binding agreements to acquire 67% and 33% of Gippsland Prospecting
Pty Ltd (Gippsland Prospecting), which has the sole right to apply for a highly prospective exploration licence of Block 4
immediately adjacent to Thursday’s Gossan copper-gold project in Victoria. The acquisition is subject to the approval of
Battery Minerals shareholders and the grant of the exploration licence. As a consideration, Battery Minerals will issue
439,363,850 ordinary shares and pay up to $500,000 to the three shareholders of Gippsland Prospecting Pty Ltd and repay
Gippsland Prospecting shareholder loans of $250,000 for past expenditure. Battery Minerals has agreed to spend a
minimum of $1.5 million on exploration and evaluation on Block 4 in the first 12 months after completion of the transaction.
On completion of the transaction Mr Kent Balas and Dr Darryl Clark will join the Battery Minerals Board, and Mr Balas will
be appointed as Managing Director of Battery Minerals. Subject to shareholder approval, Battery Minerals will issue the
new members of the management 70 million Zepo incentive 5-year options with vesting conditions subject to clear
performance targets, being the definition of mineral resources, ore reserves and a decision to mine.
After the reporting date, the Company seen macro-economic uncertainty with regards to prices and demand for battery
minerals including graphite as a result of the COVID-19 (coronavirus) outbreak. Furthermore, recent global developments
and uncertainty in March 2020 has caused further abnormally large volatility in commodity and stock markets. The scale
and duration of these developments remain uncertain but could impact the Company’s ability to finance its projects.
Page 18
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Directors’ Report (continued)
Information on Directors
David Flanagan
Qualifications
Experience
Non-Executive Chairman (appointed 1 July 2019)
Executive Chairman (appointed 8 April 2019 – resigned 1 July 2019)
Managing Director (appointed 25 January 2018 – resigned 8 April 2019)
Executive Chairman (appointed 30 March 2017 – resigned 25 January 2018)
Non-Executive Chairman (appointed 11 October 2016 – resigned 30 March 2017)
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 past 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
Non-Executive Director, Magmatic Resources Limited (appointed 28 October 2019).
Managing Director, Atlas Iron Limited (Resigned 28 June 2016)
Non-Executive Director, Northern Star Resources Limited (resigned 20 April 2018)
Jeremy Sinclair
Qualifications
Experience
Current Directorships
Former directorships in last 3
years
Jeff Dowling
Qualifications
Experience
Current Directorships
Former directorships in last 3
years
Non-Executive Director (appointed 22 November 2019)
Managing Director (appointed 8 April 2019 – resigned 22 November 2019)
BSc Engineering (Mining)
Jeremy Sinclair is a mining engineer with 25 years of experience in a broad range of roles including
executive, operational, project delivery, corporate leadership and consulting in Australia and Africa.
Prior to joining Battery Minerals Limited, Mr Sinclair was the Chief Operating Officer at Atlas Iron, a
position which he held from 2011 to 2018. Mr Sinclair oversaw the commissioning and ramp up of
Atlas’ five mines from a production rate of 1Mtpa to a production rate of 16Mtpa. Prior to his time at
Atlas Mr Sinclair held key management roles in the Pilbara iron ore operations of Rio Tinto.
Nil
Nil
Non-Executive Chairman (appointed 25 January 2018)
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, Pura Vida Energy NL (Resigned 16 May 2016)
Non-Executive Director, Atlas Iron Limited (Resigned 4 May 2016)
Page 19
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Directors’ Report (continued)
Information on Directors (cont’d)
Gilbert George
Qualifications
Experience
Current directorships
Former directorships in last 3
years
Brett Smith
Qualifications
Experience
Current Directorships
Former directorships in last 3
years
Paul Glasson
Qualifications
Experience
Current Directorships
Former directorships in last 3
years
Ivy Chen
Qualifications
Experience
Current Directorships
Former directorships in last 3
years
Non-Executive Director (appointed 11 October 2016 - resigned 21 May 2019)
Non-Executive Chairman (appointed 1 August 2012 – resigned 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 (appointed 1 August 2012 – resigned 21 May 2019)
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
Non-Executive Director, Pacific Bauxite Limited (Resigned 29 November 2018)
Non-Executive Director (appointed 19 April 2017 – resigned 21 June 2019)
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
Non-Executive Director (appointed 25 January 2018 – resigned 21 June 2019)
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
Page 20
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Directors’ Report (continued)
Information on Directors (cont’d)
Director Meetings
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 Jeremy Sinclair
Mr Jeff Dowling
Mr Gilbert George
Mr Brett Smith
Mr Paul Glasson
Ms Ivy Chen
12
6
12
7
7
8
8
12
6
12
7
7
8
8
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 retired on 14 March 2019 at the annual general
meeting on 21 May 2019. Directors Ivy Chen and Paul Glasson announced their retirement on 21 June 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) and Magmatic
Resources Ltd (ASX: MAG). 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.
Page 21
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Directors’ Report (continued)
Financial Performance and Financial Position
Financial Performance / Position
Cash and cash equivalents
Net assets
Loss for the period
Loss per share
31-Dec-19
$
31-Dec-18
$
4,119,160
7,252,709
10,904,567
(36,774,169)
(2.930)
44,644,651
(7,243,165)
(0.763)
Change
%
-43.2%
-37.7%
207%
132.2%
The net assets of the Group have decreased from $44,644,650 as at 31 December 2018 to $10,904,567 as at 31 December
2019 due to impairment of the exploration and evaluation expenditure and capitalised mine development expenditure.
The Group’s working capital (current assets less current liabilities) has reduced from $6,638,314 as at 31 December 2018
to $3,982,054 as at 31 December 2019, primarily due to lower fund raising of $ 5.1 million in 2019 compared to $20.7
million in 2018.
Shares under Options
Unissued ordinary shares of Battery Minerals Limited under options as at 31 December 2019 are summarised as follows:
Directors
Employees
Service Providers
Shareholders
Non-Vested
97,750,000
90,125,000
7,800,000
-
195,675,000
Vested
Total
34,750,000
7,675,000
7,800,000
274,484,066
324,709,066
132,500,000
97,800,000
15,600,000
274,484,066
520,384,066
Insurance of Directors and Officers Liability
The Group has executed a policy with an appropriate level of directors’ and officers’ insurance cover.
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 22 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 22 to the financial statements do not compromise the external auditor’s independence.
Page 22
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
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 2019 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 (KMP) in office during the period are as follows:
Director
David Flanagan
Jeremy Sinclair
Jeff Dowling
Gilbert George
Brett Smith
Paul Glasson
Ivy Chen
Position
Non-Executive Chairman
Executive Chairman
Managing Director
Executive Chairman
Non-Executive Chairman
Non-Executive Director
Managing Director
Non-Executive Director
Non-Executive Chairman
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Appointed
1 July 2019
8 April 2019
25 January 2018
30 March 2017
11 October 2016
22 November 2019
8 April 2019
8 April 2019
25 January 2018
1 August 2012
1 August 2012
19 April 2017
25 January 2018
Resigned
-
1 July 2019
8 April 2019
25 January 2018
30 March 2017
-
22 November 2019
-
8 April 2019
21 May 2019
21 May 2019
21 June 2019
21 June 2019
KMP
Nick Day
Tony Walsh
Ben Van Roon
Position
CFO and Company Secretary
Company Secretary
Chief Operating Officer
Appointed
8 October 2018
17 February 2017
11 August 2017
Resigned
-
-
8 November 2019
Page 23
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Directors’ Report (continued)
Audited Remuneration Report (continued)
A Principles Used to Determine the Nature and Amount of Remuneration
(i) Board Oversight
For 2019, 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.
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.
‑
‑
Non-Executive Directors have up to the date of this report, been offered incentive zero exercise priced 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. Non-Executive
Director remuneration is not 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.
Page 24
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Directors’ Report (continued)
Audited Remuneration Report (continued)
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.
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.
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.
Page 25
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Directors’ Report (continued)
Audited Remuneration Report (continued)
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.
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.
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 the Montepuez Graphite project finance and 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 21 May 2019 the general meeting of Battery Minerals shareholders approved the issue of zero exercise priced
options (ZEPOs) to Executive Directors, Executives, and staff with specific vesting hurdles being:
32% vest only on the financial close of the project finance for Stage 1 of the Montepuez Graphite project;
33% vest only on the commencement of commercial production for Stage 1 at the Montepuez Graphite
project;
34% vest only on the commencement of commercial production for Stage 2 at the Montepuez Graphite
project.;
1% vest only on the commencement of commercial production for Stage 1 at the Balama Central Graphite
project.;
Page 26
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Directors’ Report (continued)
Audited Remuneration Report (continued)
The issue of ZEPOs in 2019 is designed by the Board to:
align executives and other employees’ objectives with the Company’s publicly stated objectives of financing
and 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 2019 short term incentive programme, and
align employees to shareholders by connecting cash flow generation to the vesting of benefits
Options issued to Non-Executive Directors have vesting conditions based on a continues service with the Company.
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 recommended to the Board for its consideration.
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
Amounts of Remuneration
Details of the remuneration of the directors and key management personnel of the Group as at 31 December 2019 are
summarised in the table below:
Fixed Remuneration, $
Short- term employee benefits
31 December 2019
Salary &
fees
Termination
benefit
Non-
monetary
benefits
Performance Based Remuneration,
$
Share-based payments
Total
% of
variable
remunera
tion
Options
Shares
Rights
%
Post-
employmen
t benefits
Super-
annuation
Directors
Non-executive directors
David Flanagan – appointed 8/04/19
Jeff Dowling
Jeremy Sinclair – appointed 22/11/19
Gilbert George -resigned 21/05/19
Brett Smith - resigned 21/05/19
Paul Glasson- resigned 21/06/19
Ivy Chen – resigned 21/06/19
Sub-total
Executive directors
David Flanagan – resigned 8/04/19
Jeremy Sinclair – appointed 8/04/19 –
resigned 22/11/19
Sub-total
Key Management Personnel (KMP)
Nick Day
Tony Walsh
Ben Van Roon – resigned 8/11/19
Sub-total
Total Directors and KMP
compensation (Group)
78,200
52,148
3,425
24,388(3)
18,250
17,380
19,692
213,483
-
-
-
-
-
-
-
-
122,593
208,931
-
10,414 (6)
331,524
10,414
180,654 (7)
187,313 (8)
168,356 (9)
536,323
-
-
4,722 (6)
4,722
1,081,330
15,136
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
7,404
4,954
325
-
-
-
1,871
14,554
- (1)
83,035
- (2)
3,329
3,329
12,716
(9,913) (4)
92,496
11,042
16,187
(239,802) (5)
- (2)
27,229
(239,802)
13,940
-
11,418
25,358
- (10)
(47,561) (11)
(25,148) (4)
(72,709)
67,141
(220,015)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
The above table includes values for share based payments (options) at their fair value.
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
85,604
140,137
3,750
27,717
21,579
30,096
11,650
320,533
(106,167)
235,532
0%
59%
0%
12%
15%
42%
(85%)
29%
226%
0%
129,365
(185%)
194,594
139,752
159,348
493,694
0%
(34%)
(16%)
(15%)
943,592
(23%)
Page 27
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Directors’ Report (continued)
Audited Remuneration Report (continued)
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
(9)
8,000,000 zero exercise prices options were issued to David Flanagan on 21 May 2019 following the approval of the general meeting of
Battery Minerals shareholders. No expense was recognised due to a low probability of vesting conditions to be met.
50,000,000 zero exercise priced options were issued to Jeremy Sinclair on 21 May 2019 following the approval of the general meeting of
Battery Minerals. No expense was recognised as the options were forfeited following his resignation from the position of a Managing
Director.
The directors’ fees of Gilbert George include fees for the additional professional consultancy work of $5,000.
Due to the resignation of Ivy Chen and Ben van Roon, 600,000 and 22,000,000 options were forfeited respectively resulting in a reversal of
the share-based payment expense recognised in profit and loss.
A reversal of the share-based payment expense recognised in profit and loss represents the expectation of vesting conditions not being met.
A termination benefit in a form of annual leave repayment was paid to Jeremy Sinclair and Ben van Roon s in accordance with their
employment agreement.
$300,000 remuneration was paid at 20% part-time pro-rata from 1 July 2019 as per the revised service agreement.
$300,000 remuneration was paid at 80% part-time pro-rata till 30 June 2019 and at 40% part-time pro-rata from 1 July 2019.
$325,000 remuneration was paid at the casual rate from 1 July 2019 as per the revised service agreement.
(10) 4,000,000 options were issued to Nick Day following the approval of ESOP by the general meeting of Battery Minerals shareholders. No
expense was recognised due to the expectation of vesting conditions not being met.
(11) 10,000,000 options were issued to Tony Walsh following the approval of ESOP by the general meeting of Battery Minerals shareholders. No
expense was recognised due to the expectation of vesting conditions not being met. The share-based payment expense recognised in profit
and loss in prior periods has been reversed due to a low probability of vesting conditions to be met.
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
%
38
51
58
54
45
49
56
56
56
-
16
11
-
3
7
37
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
45,000
49,210
38,444
270,043
444,951
87,734
532,685
66,065
240,000
306,951
230,907
177,765
1,021,688
-
-
-
-
-
-
-
112,908
112,908
-
-
-
46,659
-
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
-
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.
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.
The following table summarises the remuneration of directors as per service agreements in place as at 31 December 2019.
Page 28
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Directors’ Report (continued)
Audited Remuneration Report (continued)
Name
Non-Executive
Term of
Agreement
Base Salary including
Superannuation
Termination Benefit (1)
Chairman – David Flanagan (from 08/04/19)
Director – Jeff Dowling (from 08/04/19)
Director – Jeremy Sinclair (from 21/11/19)
Director – Gilbert George (resigned 21/05/19)
Director – Brett Smith (resigned 21/05/19)
Director – Paul Glasson (resigned 21/06/19)
Director - Ivy Chen (resigned 21/06/19)
Open
Open
Open
Open
Open
Open
Open
$80,000
$45,000
$45,000
$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.
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.
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 – resigned 8 April 2019
• 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 of the Montepuez Graphite project as agreed by the board.
Termination – 6 months’ notice
•
Mr Jeremy Sinclair, Managing Director- appointed 8 April 2019 - resigned 22 November 2019
• Base Remuneration – $400,000 inclusive of superannuation
•
Equity Incentive – 50,000,000 five-year options. 12,000,000 vesting on achieving financial close of the Montepuez
Graphite project finance; 28,000,000 vesting equally on commercial production of stages 1 and 2 of the Montepuez
Graphite project and 10,000,000 vesting on commencement of commercial production of stage 1 of the Balama
Central project.
Termination – 6 month’s notice
•
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 of the Montepuez Graphite project.
Termination – Nil notice
•
Mr Ben Van Roon, Chief Operating Officer- resigned 8 November 2019
• 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 – 1 month’s notice
•
•
Page 29
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Directors’ Report (continued)
Audited Remuneration Report (continued)
Mr Nick Day, Chief Financial Officer & Joint Company Secretary
• Base Remuneration - $300,000 inclusive of superannuation (paid pro-rata for part time from 1 July 2019).
•
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 the Montepuez project phase 1, 2,000,000 vesting on the commencement of commercial production
of the Montepuez project phase 2 and 1,000,000 vesting on the commencement of commercial production of the
Balama Central project.
Termination – 3 months’ notice
•
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)
Jeremy Sinclair (2)
Jeff Dowling (3)
Tony Walsh (4)
Nick Day (5)
Ben van Roon (6)
Date Options
Granted
21-May-19
21-May-19
21-May-19
21-May-19
21-May-19
21-May-19
Vesting
Date
Number of
Options
Granted
8,000,000 Various
50,000,000 Various
7,500,000 Various
10,000,000 Various
4,000,000 Various
16,000,000 Various
95,500,000
Expiry Date
Exercise
Price
20-Jun-24
20-Jun-24
20-Jun-24
20-Jun-24
20-Jun-24
20-Jun-24
nil
nil
nil
nil
nil
nil
Value per
option at
grant date, $
0.022
0.022
0.022
0.022
0.022
0.022
Total Fair
Value, $
%
vested
%
forfeited
176,000
990,000
165,000
220,000
66,000
352,000
1,969,000
0%
0%
0%
0%
0%
-
0%
100%
0%
0%
0%
100%
Options were issued in accordance with the approval of the General Meeting of shareholders on 21 May 2019 at nil
exercise price and valued at the market share price on a date of issue.
(1)
(2)
(3)
(4)
(5)
Options issued to David Flanagan have vesting conditions linked a financial close and equity funding for the Montepuez project stage 1.
12,000,000 option issued to Jeremy Sinclair have vesting conditions linked a financial close and equity funding for the Montepuez project
phase 1; 16,500,000 have vesting conditions linked to commencement of commercial production of the Montepuez project stage1,
16,500,000 options linked to commencement of commercial production of the Montepuez project stage 2 and 5,000,000 options linked to
the commencement of commercial production of the Balama Central projects stage 1. All options were forfeited upon Jeremy Sinclair’
resignation from the position of a Managing Director.
7,500,000 options issued to Jeff Dowling will vest in three equal parts on completion of 12 months, 24 months and 36 months of continuous
service.
4,000,000 options issued to Tony Walsh will vest on financial close and equity funding for the Montepuez project stage 1; 3,000,000 options
have vesting conditions linked to commencement of commercial production of the Montepuez project stage 1 and 3,000,000 options will
vest on commencement of commercial production of the Montepuez project stage 2.
1,000,000 options issued to Nick Day will vest on commencement of commercial production of the Montepuez project stage 1; 2,000,000
options have vesting conditions linked to commencement of commercial production of the Montepuez project stage 2 and 1,000,000 options
will vest on commencement of commercial production of the Balama Central project.
(6) Options were forfeited on resignation and corresponding value was reversed in profit and loss.
Page 30
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
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 2019 will also have an impact on future year’s remuneration. Conditions are shown below:
David Flanagan
Ivy Chen
Jeff Dowling
Ben van Roon
Ben van Roon
Tony Walsh
David Flanagan
Paul Glasson
Tony Walsh
David Flanagan
David Flanagan
Gilbert George
Brett Smith
Date Options
Granted
27-Jun-18
27-Jun-18
27-Jun-18
27-Jun-18
27-Jun-18
27-Jun-18
26-May-17
26-May-17
15-Feb-17
21-Dec-16
21-Dec-16
21-Dec-16
21-Dec-16
Vesting
Date
Number of
Options
Granted
20,000,000 Various (1)
3,000,000 Various (2)
4,500,000 Various (3)
4,000,000 Various (4)
3,000,000 Various (4)
4,000,000 Various (5)
10,000,000 Various (6)
3,000,000 Various (7)
1,500,000 Various (8)
5,000,000 21-Dec-18
5,000,000 21-Dec-18
1,500,000 21-Dec-18
1,500,000 21-Dec-18
66,000,000
Expiry Date
Exercise
Price
03-Jul-23
30-Jun-23
30-Jun-22
13-Jul-23
16-Jul-23
13-Jul-23
26-May-22
26-May-22
23-Dec-21
23-Dec-21
23-Dec-21
23-Dec-21
23-Dec-21
nil
0.13
0.13
nil
0.20
nil
0.094
0.13
0.15
0.20
0.25
0.155
0.155
Value per
option at
grant date, $
0.031
0.0166
0.0166
0.031
0.0144
0.031
0.0456
0.0424
0.0636
0.0818
0.0778
0.0861
0.0861
Total Fair
Value, $
%
vested
%
forfeited
465,000
49,907
74,861
124,000
43,302
124,000
455,638
127,162
95,384
408,961
389,108
129,156
129,156
2,615,635
0%
50%
50%
0%
33%
0%
0%
100%
33%
100%
100%
100%
100%
0%
50%
0%
100%
67%
0%
0%
0%
0%
0%
0%
0%
0%
(1) Options vesting conditions are linked to commencement of commercial production being 25% of the Montepuez project stage 1, 50% of the
Montepuez project stage 2 and 25% of the Balama project stage 1.
(2) 50% of options will vested upon 12 months of continuous service and 50% of options were forfeited due to resignation before 24 months of
continuous service with a corresponding value being reversed in profit and loss.
(3) 50% of options vested upon 12 months and 50% will vest upon 24 months of continuous service.
(4) 1,000,000 options vested upon 12 months of services. 6,000,000 options were forfeited on resignation and corresponding value was reversed
in profit and loss.
(5) Options vesting conditions are linked to commencement of commercial production being 50% of the Montepuez project stage 1 and 50% of
the Montepuez project stage 2.
(6) Options will vest upon the Company’s Montepuez project achieving sales agreements and a commercial rate of production as agreed by the
board.
(7) 50% of options vested upon 12 months and 50% vested upon 24 months of continuous service.
(8) 500,000 options vested upon 12 months of service with the Company. 1,000,000 options will vest upon commencement of the Montepuez
project commercial production.
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 31
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Directors’ Report (continued)
Audited Remuneration Report (continued)
31 December 2019
Name
Balance at the start of
the year, number of
shares
Received during the
year on the exercise of
options
Other changes (1)
Balance at the end of
the year, number of
shares
Directors
David Flanagan
Jeremy Sinclair
Jeff Dowling
Gilbert George (resigned 21/05/19)
Brett Smith (resigned 21/05/19)
Ivy Chen (resigned 21/06/19)
Paul Glasson (resigned 21/06/19)
KMP
Tony Walsh
Nick Day
Ben van Roon
Total
4,997,492
-
1,500,000
9,198,656
728,522
100,000
-
850,000
-
-
17,374,670
-
-
-
-
-
-
-
-
-
-
-
2,000,000
4,000,000
500,000
(9,198,656) (2)
(728,522) (2)
(100,000) (2)
-
400,000
-
-
(3,127,178)
6,997,492
4,000,000
2,000,000
-
-
-
-
1,250,000
-
-
14,247,492
(1)
(2)
Shares acquired & disposed on-market during the financial year.
The balance of shares at the end of the financial year is considered to be nil due to the resignation as a Company Director.
Option & performance rights holdings
The numbers of options 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
2019
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
David Flanagan
Jeremy Sinclair
Jeff Dowling
Gilbert George
Brett Smith
Ivy Chen
Paul Glasson
KMP
Tony Walsh
Ben van Roon
Nick Day
50,425,000
8,000,000 (1)
-
50,000,000 (1)
4,800,000
7,500,000 (1)
1,000,000 (2)
2,000,000 (2)
250,000 (2)
4,500,000
4,125,000
3,050,000
3,000,000
-
-
-
-
-
-
-
-
5,675,000
7,000,000
10,000,000 (1)
16,000,000 (1)
-
4,000,000 (1)
200,000 (2)
-
-
Total
82,575,000
95,500,000
3,450,000
-
-
-
-
-
-
-
-
-
-
-
-
50,000,000 (1)
59,425,000
21,425,000 38,000,000
2,000,000
2,000,000
-
-
12,550,000
2,800,000
9,750,000
4,500,000 (3)
4,125,000 (3)
3,050,000 (3)
3,000,000 (3)
-
-
-
-
-
-
-
-
-
-
-
-
-
23,000,000 (3)
-
15,875,000
-
4,000,000
875,000 15,000,000
-
-
-
4,000,000
87,675,000
93,850,000
27,100,000
66,750,000
(1)
(2)
(3)
Zero exercise priced options were granted on 21 May 2019 as approved by the General Meeting of the shareholders on 21 May 2019.
Forfeited upon the resignation from the position of a Managing Director.
Listed options exercisable at 10 cents on or before 31/07/2023, issued for every two Placement Shares subscribed under the Placement
approved by the General meeting of Battery Minerals shareholders on 21 May 2019.
The balance of options at the end of the financial year is considered to be nil due to resignation as a Company Director or a Key
Management Personnel.
Page 32
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Directors’ Report (continued)
Audited Remuneration Report (continued)
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 2019.
There were no other transactions with key management personnel during the year ended 31 December 2019.
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 95.34% of “yes”
votes on its remuneration report for the 2019 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.
Page 33
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
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 35 for the year ended 31 December 2019.
This report is made in accordance with a resolution of the Directors.
David Flanagan
Chairman
Perth, Western Australia, 25 March 2020
Page 34
Lead Auditor’s Independence Declaration under
Section 307C of the Corporations Act 2001
To the Directors of Battery Minerals Limited
I declare that, to the best of my knowledge and belief, in relation to the audit of Battery Minerals
Limited for the financial year ended 31 December 2019 there have been:
i.
ii.
no contraventions of the auditor independence requirements as set out in the
Corporations Act 2001 in relation to the audit; and
no contraventions of any applicable code of professional conduct in relation to the audit.
KPMG
R Gambitta
Partner
Perth
25 March 2020
KPMG, an Australian partnership and a member firm of the KPMG
network of independent member firms affiliated with KPMG
International Cooperative (“KPMG International”), a Swiss entity.
Liability limited by a scheme approved under
Professional Standards Legislation.
Page 35
Independent Auditor’s Report
To the shareholders of Battery Minerals Limited
Report on the audit of the Financial Report
Opinion
We have audited the Financial Report of
Battery Minerals Limited (the Company).
The Financial Report comprises:
• Consolidated statement of financial position as
In our opinion, the accompanying Financial
Report of the Company is in accordance with
the Corporations Act 2001, including:
•
•
giving a true and fair view of the Group’s
financial position as at 31 December 2019
and of its financial performance for the
year ended on that date; and
complying with Australian Accounting
Standards and the Corporations
Regulations 2001.
at 31 December 2019
• Consolidated statement of profit or loss and
other comprehensive income, Consolidated
statement of changes in equity, and
Consolidated statement of cash flows for the
year then ended
• Notes including a summary of significant
accounting policies
• Directors’ Declaration.
The Group consists of the Company and the
entities it controlled at the year-end or from time to
time during the financial year.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Our responsibilities under those standards are further described in the Auditor’s responsibilities for
the audit of the Financial Report section of our report.
We are independent of the Group in accordance with the Corporations Act 2001 and the ethical
requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics
for Professional Accountants (including Independence Standards) (the Code) that are relevant to our
audit of the Financial Report in Australia. We have fulfilled our other ethical responsibilities in
accordance with the Code.
Material uncertainty related to going concern
We draw attention to Note 2B, “Going Concern Basis of Preparation” in the financial report. The
conditions disclosed in Note 2B, indicate a material uncertainty exists that may cast significant doubt
on the Group’s ability to continue as a going concern and, therefore, whether it will realise its assets
and discharge its liabilities in the normal course of business, and at the amounts stated in the
financial report. Our opinion is not modified in respect of this matter.
KPMG, an Australian partnership and a member firm of the KPMG
network of independent member firms affiliated with KPMG
International Cooperative (“KPMG International”), a Swiss entity.
Liability limited by a scheme approved under
Professional Standards Legislation.
Page 36
In concluding there is a material uncertainty related to going concern we evaluated the extent of
uncertainty regarding events or conditions casting significant doubt in the Group’s assessment of
going concern. Our approach to this involved:
• Evaluating the feasibility, quantum and timing of the Group’s plans to raise additional funds to
address going concern;
• Assessing the Group’s cash flow forecasts and plans to address going concern; and
• Determining the completeness of the Group’s going concern disclosures for the principal matters
casting significant doubt on the Group’s ability to continue as a going concern, the Group’s plans
to address these matters, and the material uncertainty.
Key Audit Matters
Key Audit Matters are those matters that, in our professional judgement, were of most significance in
our audit of the Financial Report of the current period.
These matters were addressed in the context of our audit of the Financial Report as a whole, and in
forming our opinion thereon, and we do not provide a separate opinion on these matters.
In addition to the matter described in the Material uncertainty related to going concern section, we
have determined the matter described below to be the Key Audit Matter.
Carrying value of Mozambique project assets ($3,000,000)
Refer to Note 12 and 13 to the Financial Report
The key audit matter
How the matter was addressed in our audit
The carrying value of Mozambique project
assets including Mine Development
Expenditure (Montepuez Graphite Project) and
the Exploration and Evaluation Expenditure
(Balama) was considered a key audit matter due
to:
•
•
•
The size of the mine development and
exploration expenditure asset (being
collectively 76% of pre-impaired total
assets);
The level of judgement required by us in
evaluating the Group’s assessment of
impairment; and
The Group’s market capitalisation at 31
December 2019 being lower than the net
assets, increasing the possibility the
carrying value of the Mozambique project
assets were impaired.
Our procedures included:
• We evaluated the fair value less costs of
disposal methods used by the Group against
the requirements of the accounting standards;
• We evaluated the Group’s assessment as to
the existence impairment indicators and the
determination of one cash generating unit for
the Mozambique project assets.
• Assessing the integrity of the fair value less
costs of disposal DCF model used, including
mathematical accuracy;
•
Evaluating the underlying data used to
generate the fair value less costs of disposal
DCF model for consistency with the Group’s
intention and other information. This includes
Board approved cash flow forecasts referred
to above, and other information such as the
Group’s external expert reports and publicly
available documentation;
Page 37
The key audit matter
How the matter was addressed in our audit
•
Evaluating the scope, competence and
objectivity of the Group’s external experts;
• Comparing forecast commodity prices for
graphite to views of the industry commentary
on future trends and the Group’s external
experts reports;
• Working with our valuation specialists, we
independently developed an estimated market
discount rate range using published reports of
comparable entities, adjusted for Mozambique
country risk factors;
• Assessing the Group’s analysis of the market
capitalisation shortfall versus the total
recoverable amount of CGUs. This included
consideration of the market capitalisation
range implied by recent share price trading
ranges, to the Group’s fair value less cost of
disposal DCF model;
Evaluating the Group’s analysis of the option
value of the project for consistency with
published reports of industry commentators;
Evaluating the underlying data used in the
Group’s peer enterprise value-to-reserve and
resources ratio analysis such as enterprise
value, mathematical accuracy and reserves
and resources value against publicly available
documentation; and
The impairment assessment requires the Group
to apply significant judgements through the use
of assumptions in a fair value less costs of
disposal basis using a discounted cash flow
(DCF) model.
The key assumptions include:
•
•
•
Forecast capital expenditure to complete
the mine development;
Forecast production levels, production
costs and sales;
Forecast commodity prices for graphite;
• Discount rate including the assessment of
Mozambique country risk factors; and
•
Life of mineral reserves.
The Group engaged external experts to assist
them in:
•
•
•
•
•
Forming a view of the forecast commodity
price for graphite;
Performing a technical due diligence of the
model, including the assessment of certain
key assumptions above, prepared for the
purposes of the project financing,
•
•
Producing the Reserves statement which
underlies the forecast production levels
utilised within the model;
Preparing a peer evaluation analysis of
enterprise value-to-reserves and resources
ratios; and
Forming a view as to the option value of
this project.
In assessing this key audit matter, we involved
senior team members and valuation specialists.
• Assessing the disclosures in the financial
report against the requirements of the
accounting standards.
Page 38
Other Information
Other Information is financial and non-financial information in Battery Minerals Limited’s annual
reporting which is provided in addition to the Financial Report and the Auditor’s Report. The Directors
are responsible for the Other Information.
Our opinion on the Financial Report does not cover the Other Information and, accordingly, we do not
express an audit opinion or any form of assurance conclusion thereon, with the exception of the
Remuneration Report and our related assurance opinion.
In connection with our audit of the Financial Report, our responsibility is to read the Other
Information. In doing so, we consider whether the Other Information is materially inconsistent with
the Financial Report or our knowledge obtained in the audit, or otherwise appears to be materially
misstated.
We are required to report if we conclude that there is a material misstatement of this Other
Information, and based on the work we have performed on the Other Information that we obtained
prior to the date of this Auditor’s Report we have nothing to report.
Responsibilities of the Directors for the Financial Report
The Directors are responsible for:
• preparing the Financial Report that gives a true and fair view in accordance with Australian
Accounting Standards and the Corporations Act 2001
•
•
implementing necessary internal control to enable the preparation of a Financial Report that gives
a true and fair view and is free from material misstatement, whether due to fraud or error
assessing the Group and Company’s ability to continue as a going concern and whether the use
of the going concern basis of accounting is appropriate. This includes disclosing, as applicable,
matters related to going concern and using the going concern basis of accounting unless they
either intend to liquidate the Group and Company or to cease operations, or have no realistic
alternative but to do so.
Auditor’s responsibilities for the audit of the Financial Report
Our objective is:
•
•
to obtain reasonable assurance about whether the Financial Report as a whole is free from
material misstatement, whether due to fraud or error; and
to issue an Auditor’s Report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in
accordance with Australian Auditing Standards will always detect a material misstatement when it
exists.
Misstatements can arise from fraud or error. They are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken on
the basis of the Financial Report.
A further description of our responsibilities for the audit of the Financial Report is located at the
Auditing and Assurance Standards Board website at:
http://www.auasb.gov.au/auditors_responsibilities/ar1.pdf. This description forms part of our Auditor’s
Report.
Page 39
Report on the Remuneration Report
Opinion
Directors’ responsibilities
In our opinion, the Remuneration Report of
Battery Minerals Limited for the year ended
31 December 2019, complies with Section
300A of the Corporations Act 2001.
The Directors of the Company are responsible for
the preparation and presentation of the
Remuneration Report in accordance with Section
300A of the Corporations Act 2001.
Our responsibilities
We have audited the Remuneration Report included
in the Directors’ report for the year ended
31 December 2019.
Our responsibility is to express an opinion on the
Remuneration Report, based on our audit conducted
in accordance with Australian Auditing Standards.
KPMG
R Gambitta
Partner
Perth
25 March 2020
Page 40
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Consolidated Statement of Profit or Loss and Other Comprehensive Income
For the year ended 31 December 2019
Other Income
Gain on disposal of subsidiary
Gain on sale of assets
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
Impairment of mine development and exploration
Other expenses
Operating loss
Interest income
Loss before tax
Income tax expense
Loss from continuing operations
Loss for the period
Note
25
17,23(c)
12,13
4
5
Other comprehensive income/(loss):
Items that will be reclassified subsequently to profit or
loss:
Exchange difference on
operations
Total comprehensive loss for the period
translation of
foreign
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)
6
6
Consolidated
31-Dec-19
Consolidated
31-Dec-18
$
15,878
270,598
276,503
617,738
(207,973)
(524,855)
(1,597,479)
788,027
(339,135)
(265,320)
(550,934)
(51,740)
(127,420)
(42,267)
(34,930,796)
(577,152)
(37,246,327)
472,158
(36,774,169)
-
(36,774,169)
$
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)
-
(7,243,165)
(36,774,169)
(7,243,165)
(961,444)
(37,735,613)
282,002
(6,961,163)
(36,774,169)
(7,243,165)
(37,735,613)
(6,961,163)
(2.930)
(2.930)
(0.763)
(0.763)
The above consolidated statement of profit or loss and other comprehensive income is to be read in conjunction with the accompanying notes.
Page 41
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Consolidated Statement of Financial Position
As at 31 December 2019
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
Provisions
Total Current Liabilities
Total Liabilities
NET ASSETS
EQUITY
Issued Capital
Reserves
Accumulated Losses
TOTAL EQUITY
Note
8
9
9
10
11
20 (f)
13
12
14
15
16
17
18
Consolidated
31-Dec-19
$
Consolidated
31-Dec-18
$
4,119,160
236,989
4,356,149
3,509,854
287,869
124,788
-
3,000,000
-
6,922,511
11,278,660
213,073
161,022
374,095
374,095
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
810,244
211,658
1,021,902
1,021,902
10,904,565
44,644,651
78,909,275
4,128,285
(72,132,995)
10,904,565
74,125,719
5,877,758
(35,358,826)
44,644,651
The above consolidated statement of financial position is to be read in conjunction with the accompanying notes.
Page 42
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Consolidated Statement of Cash Flows
For the year ended 31 December 2019
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
Net proceeds from sale of assets
Payments made for property, plant and equipment and intangibles
Payments for exploration & evaluation expenditure
Payments for mine development expenditure
Payment for mine performance bond
Note
19
Consolidated
31-Dec-19
$
Consolidated
31-Dec-18
$
(4,496,334)
472,157
(4,024,177)
(6,414,986)
144,280
(6,270,706)
67,553
366,844
(27,460)
(282,218)
(3,968,021)
-
264,320
-
(232,674)
(851,922)
(21,641,595)
(3,523,792)
Net cash (outflow) from investing activities
(3,843,302)
(25,985,663)
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
5,110,500
(326,944)
4,783,556
(3,083,923)
7,252,709
(49,626)
4,119,160
34,065,982
(2,244,527)
31,821,455
(434,914)
7,723,112
(35,489)
7,252,709
The above consolidated statement of cash flows is to be read in conjunction with the accompanying notes.
Page 43
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Consolidated Statement of Changes in Equity
For the year ended 31 December 2019
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
-
-
-
-
-
-
-
282,002
(7,243,165)
-
(7,243,165)
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
Consolidated for the year ended 31
December 2019
Issued Capital
Share based
payment
reserve
Foreign currency
translation
reserve
Accumulated
losses
$
$
$
Total
$
Balance at 1 January 2019
74,125,719
6,029,637
(151,879)
(35,358,826)
44,644,651
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
-
-
-
-
-
-
-
(961,444)
(36,774,169)
-
(36,774,169)
(961,444)
(961,444)
(36,774,169)
(37,735,613)
4,783,556
-
-
(788,029)
4,783,556
(788,029)
-
-
-
-
-
-
4,783,556
(788,029)
3,995,527
Balance at 31 December 2019
78,909,275
5,241,608
(1,113,323)
(72,132,995)
10,904,565
The consolidated statement of changes in equity is to be read in conjunction with the accompanying notes.
Page 44
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
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
by the Board of Directors for issue on 25 March 2020.
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 2019 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 2019, the consolidated entity has net assets of $10,904,565 (2018: $44,644,651). During the
financial year the consolidated entity had cash outflows from operating activities of $4,024,177 (2018: $6,270,706)
and cash outflows from investing activities (including payments for mine development and exploration) of
$3,843,303 (2018: $25,985,663). The consolidated entity has minimum expenditure commitments as set out in Note
25.
Page 45
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Notes to the Consolidated Financial Statements (continued)
2.
Basis of Accounting (continued)
The ability of the Group to continue as a going concern is principally dependent upon the ability of the Company to
raise capital from equity and debt markets and managing cashflow in line with available funds. Subsequent to this
year end, the Group has received MZN 83 million (AUD2.1 million) in March 2020 being a cash release due to a
reduction of the performance bond held with the Unico Bank in Mozambique. The Group is anticipating a potential
refund from suppliers for orders placed at the beginning of 2018 that have not been completed or progressed
further. The Group will need to raise additional funds to meet expenditure commitments for a newly acquired right
for a prospective exploration asset in Victoria and support its current level of corporate overheads to continue as a
going concern. 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 will continue working on
equity/debt finance for the Montepuez Graphite Project revisiting its strategy to adjust to a changing market
environment.
Based on the cash flow forecasts, and other factors referred to above, the Directors are satisfied that the going
concern basis of preparation is appropriate. Given the Company’s history of raising capital to date, the Directors are
confident of the Company’s ability to raise additional funds as and when they are required, should the need arise.
However, the completion of any potential capital raise will be dependent on investor support, shareholder
participation and prevailing capital market volatility whether caused by COVID-19 or otherwise. If the Group is not
successful in securing sufficient funds, there is a material uncertainty that may cast significant doubt on whether the
Group is able to continue as a going concern and as to whether the Group will be able to release its assets in the
normal course of business and at amounts stated in the financial statements. The financial statements do not include
any adjustments relating to the recoverability and classification of asset carrying amounts or to the amount and
classification of liabilities that might result should the Group be unable to continue as a going concern and meet its
debts as and when they fall due.
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.
Page 46
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Notes to the Consolidated Financial Statements (continued)
2.
Basis of Accounting (continued)
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.
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 exists, the recoverable amount of the asset is 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. Leases
On transition to AASB 16, the Group elected to apply the practical expedient to grandfather the assessment of which
transactions are leases. The Group applied AASB 16 only to contracts that were previously identified as leases.
Contracts that were not identified as leases under AASB 117 and AASB Interpretation 4 were not reassessed for
whether there is a lease under AASB 16. Therefore, the definition of a lease under AASB 16 was applied only to
contracts entered into or changed on or after 1 January 2019.
The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted
for any lease payments made at or before the commencement date, plus any initial direct costs incurred and an
estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset or the site on
which it is located, less any lease incentives received.
The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to
the end of the lease term, unless the lease transfers ownership of the underlying asset to the Group by the end of
the lease term or the cost of the right-of-use asset reflects that the Group will exercise a purchase option. In that
case the right-of-use asset will be depreciated over the useful life of the underlying asset, which is determined on
the same basis as those of property and equipment. In addition, the right-of-use asset is periodically reduced by
impairment losses, if any, and adjusted for certain remeasurements of the lease liability.
The lease liability is initially measured at the present value of the lease payments that are not paid at the
commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily
determined, the Group’s incremental borrowing rate.
Page 47
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Notes to the Consolidated Financial Statements (continued)
2.
Basis of Accounting (continued)
The lease liability is measured at amortised cost using the effective interest method. It is remeasured when there is
a change in future lease payments arising from a change in an index or rate, if there is a change in the Group’s
estimate of the amount expected to be payable under a residual value guarantee, if the Group changes its
assessment of whether it will exercise a purchase, extension or termination option or if there is a revised in-
substance fixed lease payment.
Previously, the Group classified property leases as operating leases under AASB 117. On transition, no right-of-use
assets and lease liabilities were recognised on the balance sheet as the application of the standard did not have a
material effect to the Group’s financial statements.
The Group used a number of practical expedients when applying AASB 16 to leases previously classified as operating
leases under AASB 117. In particular, the Group:
•
•
•
•
did not recognise right-of-use assets and liabilities for leases for which the lease term ends within 12 months
of the date of initial application;
did not recognise right-of-use assets and liabilities for leases of low value assets;
excluded initial direct costs from the measurement of the right-of-use asset at the date of initial application;
and
used hindsight when determining the lease term.
The Group had no leases classified as finance leases under AASB 117 prior to 1 January 2019.
F. 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 23
G. Changes in Accounting Policy
In the year ended 31 December 2019, 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 16 with an effect from 1 January 2019. 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.
Page 48
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Notes to the Consolidated Financial Statements (continued)
2.
Basis of Accounting (continued)
H. Standards issued not yet effective
Title of standard
Nature of change
Impact
Mandatory
application date/
Date adopted by
company
AASB 2018-7
Amendments to
Australian
Accounting
Standards –
Definition of
Material
Principally amends AASB 101 and AASB 108.
The amendments refine the definition of “material” in
AASB 101. The amendments clarify the definition of
material and its application by improving the wording and
aligning the definition across the Australian Accounting
Standards and other publications. The amendment also
includes some supporting requirements in AASB 101 in the
definition to give it more prominence and clarifies the
explanation accompanying the definition of material.
When these amendments are first adopted
for the year ending 31 December 2020,
there will be no material impact on the
financial statements.
Annual reporting
periods beginning
on or after 1
January 2020
All other pending Standards issued between the previous financial report and the current reporting dates have no application to the
Group.
Page 49
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
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 2019
Interest revenue
Mozambique
$
Australia
$
411,531
60,626
Total
$
472,157
Other segment income
8,274
7,604
15,878
Net foreign exchange gain/(loss)
286,180
331,558
617,738
Business development
Corporate and administration overhead
Fair value adjustment on equity securities
Exploration and mine development impairment
Total segment expenses
-
(501,159)
-
(34,930,796)
(35,431,955)
(1,197,724)
(1,755,098)
(42,267)
-
(2,995,089)
(1,197,724)
(2,256,257)
(42,267)
(34,930,796)
(38,427,044)
Reportable segment loss
(34,449,467)
(2,324,702)
(36,774,169)
Segment Assets
Cash
Exploration and evaluation
Mine development asset
Other (1)
Total segment assets
Mozambique
$
567,226
-
3,000,000
3,982,804
7,550,030
Australia
$
3,551,934
-
-
176,696
3,728,630
Total
$
4,119,160
-
3,000,000
4,159,500
11,278,660
(1) Other assets of the reporting segment “Mozambique” include current and non-current receivable of the mine performance bond of
$3,509,854 held with the Unico Bank.
Segment Liabilities
Creditors and other payables
Total segment liabilities
Mozambique
$
(125,185)
(125,185)
Australia
$
(248,910)
(248,910)
Total
$
(374,095)
(374,095)
Page 50
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
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
Mozambique
$
281,835
3,980,647
1,259
4,263,741
Australia
$
-
-
32,684
32,684
Total
$
281,835
3,980,647
33,943
4,296,425
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
Total segment assets
Segment Liabilities
Creditors and other payables
Total segment liabilities
Mozambique
$
474,202
2,902,615
30,950,808
4,022,283
38,349,908
Australia
$
6,778,507
-
-
538,137
7,316,644
Mozambique
$
196,574
196,574
Australia
$
825,328
825,328
Capital Expenditure during the year
Exploration and evaluation – Balama Project
Mine development asset – Montepuez Project
Plant & equipment and intangible assets
Total capital expenditure
Mozambique
$
1,055,005
22,537,517
65,222
23,657,744
Australia
$
-
-
166,113
166,113
Total
$
7,252,709
2,902,615
30,950,808
4,560,421
45,666,553
Total
$
1,021,902
1,021,902
Total
$
1,055,005
22,537,517
231,335
23,823,857
Page 51
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Notes to the Consolidated Financial Statements (continued)
4. Other Expenses
Office costs
Depreciation
IT consultants and website
Subscriptions
Community support
Administrative operating costs
Total other expenses
5.
Income Tax
Consolidated
31 Dec 2019
$
Consolidated
31 Dec 2018
$
227,492
161,330
76,814
28,418
16,632
66,466
577,152
305,378
86,378
184,528
109,955
167,321
41,675
895,235
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.
Page 52
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Notes to the Consolidated Financial Statements (continued)
5. Income Tax (continued)
(a)
Income tax expense
Current tax
Deferred tax
(b)
Reconciliation of income tax expense to prima facie tax
payable:
Loss before income tax
Prima facie income tax at 30% (30% in 2018 FY)
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)
(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
Consolidated
31 Dec 2019
$
Consolidated
31 Dec 2018
$
-
-
-
-
-
-
(36,774,169)
(11,032,251)
(11,052)
2,734,315
8,276,597
32,391
-
(7,243,165)
(2,172,950)
(13,500)
415,629
18,144
1,752,677
-
Consolidated
31 Dec 2019
$
Consolidated
31 Dec 2018
$
4,842,693
2,930,867
40,522
7,814,082
3,483,184
2,865,670
220,894
6,569,748
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.
Page 53
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Notes to the Consolidated Financial Statements (continued)
6. Earnings per Share (continued)
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 2019
(36,774,169)
Consolidated
31 Dec 2018
(7,243,165)
(2.930)
(0.763)
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
1,255,124,426
948,706,481
1,255,124,426
948,706,481
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.
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 2019
$
4,119,160
4,119,160
Consolidated
31 Dec 2018
$
7,252,709
7,252,709
Cash at bank and in hand earns interest at floating rates based on daily bank rates. Refer to Note 20 (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
Consolidated
31 Dec 2019
$
Consolidated
31 Dec 2018
$
72,823
88,568
75,598
236,989
55,769
265,504
86,234
407,507
Page 54
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Notes to the Consolidated Financial Statements (continued)
9. Other Receivables (continued)
Non-Current
Other receivables (1)
Consolidated
31 Dec 2019
$
Consolidated
31 Dec 2018
$
3,509,854
3,509,854
3,523,792
3,523,792
(1)
Non-current other receivable is the mine performance bond of $3,509,854 (MZN 152 million) kept on a deposit with the Unico Bank in
Mozambique.
The carrying amounts disclosed above represent their fair value.
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 13).
Plant and equipment at cost
Accumulated depreciation
Net carrying amount
Consolidated
31 Dec 2019
$
628,952
(341,083)
287,869
Consolidated
31 Dec 2018
$
758,796
(237,570)
521,226
Page 55
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Notes to the Consolidated Financial Statements (continued)
10.
Property, Plant and Equipment (continued)
Movements in carrying amounts
Balance at beginning of the year
Additions during the year
Reclassified to mine development
Depreciation expense
Reclassified to intangibles
Foreign currency translation movement
Net carrying amount at the end of the year
Consolidated
31 Dec 2019
$
521,226
3,985
(3,006)
(103,485)
(128,912)
(1,939)
287,869
Consolidated
31 Dec 2018
$
605,951
205,075
(222,621)
(82,139)
-
14,960
521,226
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
Reclassification from property, plant and equipment
Depreciation expense
Consolidated
31 Dec 2019
$
Consolidated
31 Dec 2018
$
186,905
(62,117)
124,788
28,035
(4,672)
23,363
Consolidated
31 Dec 2019
$
Consolidated
31 Dec 2018
$
23,363
29,958
128,912
(57,445)
124,788
-
28,035
-
(4,672)
23,363
Page 56
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Notes to the Consolidated Financial Statements (continued)
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 progress 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.
Non-Current
Exploration and evaluation at cost
Movement
Balance at beginning of the year
Exploration expenditure capitalised during the year (1)
Research and development tax refund received
Exploration expenditure disposed due to the Kroussou project sale
Exploration expenditure disposed due to the tenement sale (2)
Reclassification to mine development (3)
Impairment (4)
Foreign currency translation movement
Closing exploration and evaluation net carrying amount (4)
Consolidated
31 Dec 2019
$
Consolidated
31 Dec 2018
$
-
2,902,615
2,902,615
281,835
-
-
(96,680)
-
(3,081,606)
(6,164)
-
10,433,531
2,390,506
(403,490)
(131,613)
-
(9,512,665)
-
126,346
2,902,615
(1) Exploration and evaluation expenditure capitalised in 2018 includes costs in relation to both Montepuez and Balama Central Project. Exploration
and evaluation expenditure capitalised in 2019 includes only costs relating to the Balama Central Project.
(2) Disposal of the exploration and evaluation expenditure relating to the sale of Tenement 5572 in Mozambique and its final settlement in October
2019.
(3) Reclassified exploration and evaluation expenditure relates to the Montepuez Graphite Project, which moved into the development phase.
(4) The carrying amount of $3,081,606 of exploration and evaluation expenditure attributable to Balama Central Project has been fully impaired.
Assessment of Impairment
The Group assesses whether impairment indicators exist that would require the company to estimate the
recoverable amount of the capitalised exploration and evaluation expenditure. At 31 December 2019 the Group has
determined that the Balama Central Project is considered to be part of the same cash generating unit as the
Montepeuz Graphite Project resulting in the exploration and evaluation expenditure being impaired to nil (refer
note 13).
Page 57
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Notes to the Consolidated Financial Statements (continued)
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 the mine plant or building structures works had not commenced there was no provision
made for site restoration or rehabilitation.
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
Impairment
Foreign currency translation movement
Closing mine development net carrying amount
Assessment of Impairment
Consolidated
31 Dec 2019
$
Consolidated
31 Dec 2018
$
3,000,000
30,950,808
30,950,808
3,980,647
-
-
(31,849,190)
(82,265)
3,000,000
-
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 Group and the softening of the graphite
market were identified as impairment indicators and accordingly, the Montepuez Graphite Project has been tested
for impairment.
In determining the recoverable amount the Group has had regard to a range of valuation methodologies including:
• Discounted cash flow forecasts – this approach uses externally sourced forecasts for graphite prices, estimated
quantities of recoverable ore, production levels, operating costs and capital requirements sourced from the
Group’s budgeting process.
• Comparable reserve and resource tonne multiples - enterprise value contained graphite multiples on both a
reserve and resource basis has been calculated for selected peers. Share prices were significantly affected as a
result of volatility on global and graphite markets.
• Simulated option value using an option pricing model – this approach simulates multiple scenarios using the
Monte Carlo option pricing model by adjusting the probability of the graphite price increasing.
Each of the above approaches is considered to be a fair value less cost of sale approach.
Page 58
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Notes to the Consolidated Financial Statements (continued)
The softening of the graphite market and resultant pricing has resulted in a challenging environment to raise
sufficient funding to progress the development of the Montepeuz Graphite Project. Under current forecast pricing,
it is unlikely that the projects would be developed, however, the Group intends to preserve the value of its projects
and keep them in good standing until prices recover. In this regard, the Directors have had regard to above
methodologies in determining the recoverable amount of $3 million. Should graphite prices not significantly improve
in the future, there is a risk that the carrying values will be further impaired to nil.
14. Trade and Other Payables
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.
Current
Trade and other payables
Accrued expenses
15. Provisions
Consolidated
31 Dec 2019
$
Consolidated
31 Dec 2018
$
156,900
56,173
213,073
606,905
203,339
810,244
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.
Consolidated
31 Dec 2019
$
Consolidated
31 Dec 2018
$
Current
Provisions – employee benefits
Movement
Balance at beginning of the year
Employee benefits provision accrued during the year
Employee benefits paid during the year
Balance at the end of the year
161,022
161,022
211,658
354,447
(405,083)
161,022
211,658
211,658
-
211,658
-
211,658
Page 59
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Notes to the Consolidated Financial Statements (continued)
16. 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
2019
01-Jan-2019
12-Apr-2019
30-May-2019
Opening Balance
Share issue - Placement - Tranche 1 (1)
Share issue -Placement – Tranche 2 (2)
Less: Share issue costs
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
Share issue to contractors and staff
Conversion of performance rights
Share issue to contractor
Share issue - Placement - Tranche 1
Share issue - Placement - Tranche 2
Share issue to contractor
Less: Share issue costs
Consolidated
31 Dec 2019
$
78,909,275
Consolidated
31 Dec 2018
$
74,125,719
78,909,275
74,125,719
No. of Shares
1,113,671,549
160,000,000
44,420,000
1,318,091,549
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
-
$0.025
$0.025
-
Issue
Price
-
$0.060
$0.060
$0.058
$0.060
$0.060
$0.060
$0.031
-
Amount, $
74,125,719
4,000,000
1,110,500
(326,944)
78,909,275
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
(1)
(2)
The Tranche 1 Placement shares were issued on 12 April 2019 under the Company’s 15% placement capacity pursuant to ASX Listing Ruling 7.1
and on 21 May 2019 the General Meeting of Battery Minerals Limited shareholders approved and ratified the prior issue of the shares as part
of Tranche 1 Placement.
The issue of Tranche 2 Placement securities was approved by the General Meeting of Battery Minerals shareholders held on 21 May 2019.
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.
Page 60
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Notes to the Consolidated Financial Statements (continued)
16.
Issued Capital (continued)
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 17 and Note 23.
(b)
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
Current provisions
17. Reserves
Foreign currency translation reserves
Consolidated
31 Dec 2019
$
Consolidated
31 Dec 2018
$
4,119,160
1,991,916
(213,073)
(161,022)
5,736,981
7,252,709
407,507
(810,244)
(211,658)
6,638,314
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.
Reserves
Foreign currency translation reserve
Share- based payments reserve (1)
Consolidated
31 Dec 2019
$
Consolidated
31 Dec 2018
$
(1,113,323)
5,241,608
4,128,285
(151,879)
6,029,637
5,877,758
(1)
Share based payment reserve comprises options issued as share-based payments. Refer to Note 23 for more details.
Page 61
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Notes to the Consolidated Financial Statements (continued)
17. Reserves (continued)
Movements in share-based payments reserve
2019
Details
01-Jan-19
15-Feb-19
21-May-19
21-May-19
30-May-19
24-Jun-19
01-Jul-19
01-Jul-19
08-Nov-19
15-Nov-19
22-Nov-19
31-Dec-19
31-Dec-19
31-Dec-19
Opening Balance
Forfeited options (1)
Options issued to directors (2)
Options issued to employees (3)
Listed options exercisable at $0.10 (4)
Forfeited options (5)
Forfeited options (1)
Forfeited options (1)
Forfeited options (6)
Forfeited options (1)
Forfeited options (7)
Vesting expense of prior years’ options
Reverse vesting expense of prior years (8)
Balance at end of year
No. of
Options &
Rights
307,324,066
(2,000,000)
65,500,000
72,850,000
102,210,000
(1,500,000)
(200,000)
(1,200,000)
(22,000,000)
(600,000)
(50,000,000)
-
-
470,384,066
Amount $
6,029,637
(9,885)
121,217
20,695
-
(17,809)
(2,443)
(14,660)
(84,036)
(7,330)
(59,461)
386,764
(1,121,081)
5,241,608
The total share-based payment expense of ($788,027) relating to prior years was reversed into profit and loss in
2019 due to a low probability of vesting conditions to be met.
(1) Unvested options forfeited upon resignation of an employee.
(2) Zepo options were issued to David Flanagan, Jeremy Sinclair and Jeff Dowling in accordance with the approval of the General Meeting of
shareholders on 21 May 2019. Options are exercisable at nil price and expiry on 20 June 2024. 8,000,000 options issued to David Flanagan and
12,000,000 options issued to Jeremy Sinclair have vesting conditions linked a financial close and equity funding for the Montepuez Project
phase 1. 38,000,000 options issued to Jeremy Sinclair have vesting conditions linked to commencement of commercial production being 43.5%
of the Montepuez stage 1, 43.5% the Montepuez project stage 2 and 13% of the Balama project stage 1. 7,500,000 options issued to Jeff
Dowling will vest in three equal parts on completion of 12 months, 24 months and 36 months of continuous service.
(3) The issue of Zepo options to employees was approved at the General Meeting of shareholders on 21 May 2019. Options are exercisable at nil
price and expire on 20 June 2024. 23,450,000 options will vest on financial close and equity funding for the Montepuez project stage 1;
23,750,000 options will vest on commencement of commercial production of the Montepuez project stage 1; 24,650,000 options will vest on
commencement of commercial production of the Montepuez project stage 2 and 1,000,000 options will vest on commencement of commercial
production of the Balama project.
(4) Listed options exercisable at 10 cents on or before 31/07/2023, issued for every two Placement Shares subscribed under the Placement
approved by the General meeting of Battery Minerals shareholders on 21 May 2019.
(5) Unvested options forfeited upon resignation of Ivy Chen.
(6) Unvested options forfeited upon resignation of Ben van Roon.
(7) Unvested options forefeited upon resignation of Jeremy Sinclair from the position of a Managing Director
(8) Share-based payment expenses recognised in prior periods have been reversed on the expectation that vesting conditions not being met.
Page 62
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Notes to the Consolidated Financial Statements (continued)
17. Reserves (continued)
2018
Details
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
No. of Options &
Rights
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
18. Accumulated Losses
Movement in accumulated losses
Consolidated
31 Dec 2019
$
Consolidated
31 Dec 2018
$
Balance at beginning of the year
Loss attributable to the owners of Battery Minerals Limited
Balance at end of the year
(35,358,826)
(36,774,169)
(72,132,995)
(28,115,661)
(7,243,165)
(35,358,826)
Page 63
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Notes to the Consolidated Financial Statements (continued)
19. 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
Mine development impairment
Fair value adjustment to equity securities
Gain on sale of assets
Share- based payments
Dissolution of subsidiary
Foreign currency (gain)/loss
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
20. Financial Risk Management
Financial Risk Management
Consolidated
31 Dec 2019
$
Consolidated
31 Dec 2018
$
(36,774,169)
(7,243,165)
161,330
34,930,796
42,267
90,341
(788,027)
(203,045)
(693,106)
95,680
(886,244)
(4,024,177)
86,378
-
174,350
-
1,353,549
(258,883)
(123,633)
337,265
(596,567)
(6,270,706)
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).
Page 64
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Notes to the Consolidated Financial Statements (continued)
20. Financial Risk Management (continued)
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:
Financial assets
Cash and cash equivalents
Total financial assets
Financial liabilities
Trade creditors and other payables
Total financial liabilities
AUD
884,525
884,525
20,762
20,762
The following conversion rates were used at the end of the financial year:
USD/AUD
0.7002
(2018: 0.7046)
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 2019 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%
2019
$
(78,524)
95,974
2018
$
(91,193)
111,459
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 (2018: 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 2019, the Group had interest-bearing
assets in the form of cash and cash equivalents of $4,119,160 (2018: $7,252,709) and a mine performance bond of
$3,509,854 (2018: $3,523,792). 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.
Page 65
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Notes to the Consolidated Financial Statements (continued)
20. Financial Risk Management (continued)
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
2019
$
61,032
(61,032)
2018
$
86,212
(86,212)
The hypothetical movement in basis points for the interest rate sensitivity analysis is based on the currently observed
market environment (2018: 0.80%).
The weighted average interest rate received on cash, cash equivalents and mine performance bond of the Group is
4.49% (2018: 5.38%)
(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 a 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
2019
$
4,119,160
236,989
3,509,854
7,866,003
2018
$
7,252,709
86,234
3,523,792
10,862,735
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
2019
$
3,563,002
4,066,013
236,989
7,866,004
2018
$
6,794,337
3,982,164
86,234
10,862,735
(1)
Includes mine performance bond of MZN 152 million ($3.5 million equivalent) held with the Unico Bank in Mozambique.
Page 66
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Notes to the Consolidated Financial Statements (continued)
20. Financial Risk Management (continued)
(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
$
59,980
59,980
181,634
181,634
1-3 months,
$
201,400
201,400
692,107
692,107
3months -
1 year
$
112,715
112,715
No set
date of
repayment
-
-
Total
$
374,095
374,095
148,161
148,161
-
-
1,021,902
1,021,902
2019
Trade creditors & other payables
2018
Trade creditors & other payables
(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)
2019
$
-
-
2018
$
84,533
84,533
Page 67
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Notes to the Consolidated Financial Statements (continued)
20.
Financial Risk Management (continued)
(1) 10,566,636 listed equity securities issued by Trek Limited in 2018 were sold to Morgans Financial Limited in May 2019. On 31 December 2018
the price of Trek Limited share was $0.008, and the fair value of the equity securities was $84,533. The Trek shares were sold at the market
price of $0.004 in May 2019 resulting in fair value movement of $42,267 recognised through profit and loss at the reporting date.
21. Related Party Disclosure
Parent entities and subsidiaries
Battery Minerals Limited is the ultimate Australian parent entity.
Interests in subsidiaries are set out below:
Country of
Incorporation
% Equity
31 December
2019
% Equity
31 December
2018
Rio Mazowe Limited
Express Resources Pty Ltd
Index Resources Pty Ltd
Action Resources Pty Ltd
Jackal Resources Pty Ltd
Au Resources Pty Ltd
Skype Resources Pty Ltd
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
Afriminas Minerais Limitada
Mauritius
Australia
Australia
Australia
Australia
Australia
Australia
Mauritius
Mauritius
Mauritius
Mauritius
Mauritius
Mozambique
Mozambique
Mozambique
Mozambique
Mozambique
100
100
100
100
100
100
100
nil (1)
100
100
100
100
nil (1)
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
(1)
Sold to Nedeel LLC on 25 January 2019 as per the share sale agreement of 26 September 2018. Tanga Resources Limited
owned 100% of Niassa Metals SA, a subsidiary in Mozambique. Refer to Note 25 for more details.
Page 68
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Notes to the Consolidated Financial Statements (continued)
21.
Related Party Disclosure (continued)
(a)
Key Management Personnel
The following persons were directors of Battery Minerals Limited during the financial year:
Director
David Flanagan
Jeremy Sinclair
Jeff Dowling
Gilbert George
Brett Smith
Paul Glasson
Ivy Chen
Position
Appointed
Resigned
Non-Executive Chairman
Executive Chairman
Managing Director
Executive Chairman
Non-Executive Chairman
Non-Executive Director
Managing Director
Non-Executive Director
Non-Executive Chairman
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
1 July 2019
8 April 2019
25 January 2018
30 March 2017
11 October 2016
22 November 2019
8 April 2019
8 April 2019
25 January 2018
1 August 2012
1 August 2012
19 April 2017
25 January 2018
-
1 July 2019
8 April 2019
25 January 2018
30 March 2017
-
22 November 2019
-
8 April 2019
21 May 2019
21 May 2019
21 June 2019
21 June 2019
(b)
Other key management personnel
Name
Tony Walsh
Ben Van Roon
Nick Day
Position
Company Secretary
Chief Operating Officer
Chief Financial Officer
-
resigned 8 November 2019
-
(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 2019
$
541,045
(72,709)
25,358
493,694
Consolidated
31 Dec 2018
$
1,983,983
1,199,124
74,854
3,257,961
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
23).
Page 69
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Notes to the Consolidated Financial Statements (continued)
22. Auditors’ Remuneration
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 auditors’ services
23.
Share-based payments
Consolidated
31 Dec 2019
$
16,391
46,598
-
73,225
136,214
Consolidated
31 Dec 2018
$
-
50,000
10,644
114,346
174,990
The Group provides benefits to employees (including directors) of the Group in the form of share-based payment
transactions, whereby employees render services in exchange for shares or rights over shares (‘equity-settled
transactions’). The cost of these equity-settled transactions with employees is measured by reference to the fair
value at the date at which they are granted. The fair value is determined by an internal valuation using a Black-
Scholes option pricing model and Monte Carlo methodology as appropriate.
The cost of equity-settled transactions is recognised, together with a corresponding increase in equity, over the
period in which the performance conditions are fulfilled, ending on the date on which the relevant employees
become fully entitled to the award (‘vesting date’).
The cumulative expense recognised for equity-settled transactions at each reporting date until vesting date reflects
(i) the extent to which the vesting period has expired and (ii) the number of options or performance rights that, in
the opinion of the directors of the Group, will ultimately vest. This opinion is formed based on the best available
information at balance date. No adjustment is made for the likelihood of market performance conditions being met
as the effect of these conditions is included in the determination of fair value at grant date. No expense is recognised
for awards that do not ultimately vest, except for awards where vesting is conditional upon a market condition.
Where an equity-settled award is cancelled, it is treated as if it had vested on the date of cancellation, and any
expense not yet recognised for the award is recognised immediately. However, if a new award is substituted for the
cancelled award, and designated as a replacement award on the date that it is granted, the cancelled and new award
are treated as if they were a modification of the original award
(a)
Option Issue
The following table discloses the number of options issued in the form of share-based payments to directors and
employees in 2019:
Option
Recipient
A
B
C
D
E
F
Jeff Dowling
Jeremy Sinclair
David Flanagan
Employees
Employees
Employees
Number of
Options
7,500,000
50,000,000
8,000,000
68,500,000
4,000,000
350,000
138,350,000
Issue Date
Vesting
Date
21/05/2019 Various (1)
21/05/2019 Various (2)
21/05/2019 Various (3)
21/05/2019 Various (4)
21/05/2019 Various (5)
21/05/2019 Various (6)
Expiry Date
24/04/2024
24/04/2024
24/04/2024
24/04/2024
24/04/2024
24/04/2024
Exercise
Price, $
nil
nil
nil
nil
nil
nil
Total Fair
Value, $
165,000
990,000
176,000
1,507,000
66,000
7,700
2,911,700
All options issued during the financial year had the nil exercise price and were valued at the share market price on
the grant date. No share-based payment expense was recognised in profit in loss on the expectation that vesting
conditions not being met.
Page 70
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Notes to the Consolidated Financial Statements (continued)
23.
Share-based payments (continued)
(1)
(2)
(3)
(4)
(5)
(6)
7,500,000 options will vest in three equal tranches after 12, 24 and 36 months of continuous service on the board of directors.
12,000,000 options will vest upon a financial close of the project finance and completion of the remaining equity funding for the Montepuez
Graphite project Stage 1. The rest of the options will vest upon the commencement of commercial productions of different stages:
16,500,000 options upon the Montepuez Graphite project Stage 1; 16,500,000 options upon the Montepuez Graphite project Stage 2 and
5,000,000 options upon the Balama Central Graphite project Stage 1.
8,000,000 options will vest upon a financial close of the project finance and completion of the remaining equity funding for the Montepuez
project Stage 1.
23,200,000 options will vest upon a financial close of the project finance and completion of the remaining equity funding for the Montepuez
project Stage 1, 22,650,000 options will vest upon the commencement of commercial production of the Montepuez Graphite project Stage
1 and 22,650,000 options will vest upon the commencement of commercial production of the Montepuez Graphite project Stage 2.
1,000,000 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 2 and 1,000,000 options will
vest upon the commencement of commercial production of the Balama Central Graphite project Stage 1.
250,000 options will vest upon a financial close of the project finance and completion of the remaining equity funding for the Montepuez
project Stage 1 and 100,000 options will vest upon the commencement of commercial production of the Montepuez Graphite project Stage
1.
(b) Share options outstanding at the end of the year have the following terms and conditions:
2019
Grant Date
Expiry Date
Exercise
Price, $
FV per
security, $
Balance at
start of year
30-May-16
21-Dec-16
21-Dec-16
21-Dec-16
21-Dec-16
21-Dec-16
21-Dec-16
21-Dec-16
21-Dec-16
15-Feb-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
21-May-19
21-May-19
30-May-20
21-Dec-21
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
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
24-Apr-24
24-Apr-24
0.09
0.10
0.15
0.20
0.25
0.15
0.15
0.15
0.15
0.15
0.20
0.94
0.20
0.13
0.13
0.13
0.00
0.00
0.20
0.20
0.15
0.00
0.00
Number
2,500,000
5,000,000
5,000,000
5,000,000
5,000,000
10,000,000
3,000,000
4,400,000
3,000,000
1,500,000
1,000,000
10,000,000
5,000,000
3,000,000
4,500,000
3,000,000
20,000,000
19,800,000
6,600,000
2,000,000
150,000
0.036
0.093
0.087
0.082
0.078
0.086
0.086
0.086
0.086
0.064
0.059
0.046
0.038
0.042
0.017
0.017
0.031
0.031
0.014
0.014
0.014
0.022
0.022
Granted
during the
year
Exercised
during the
year
Number
Number
72,850,000
65,500,000
Forfeited /
expired
during the
year
Number
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,500,000
-
7,000,000
2,000,000
1,000,000
-
16,000,000
50,000,000
Balance at
end of the
year
Number
2,500,000
5,000,000
5,000,000
5,000,000
5,000,000
10,000,000
3,000,000
4,400,000
3,000,000
1,500,000
1,000,000
10,000,000
5,000,000
3,000,000
4,500,000
1,500,000
20,000,000
12,800,000
4,600,000
1,000,000
150,000
56,850,000
15,500,000
Vested &
exercisable at
end of the
year
Number
2,500,000
5,000,000
5,000,000
5,000,000
5,000,000
-
3,000,000
4,400,000
3,000,000
500,000
-
-
-
3,000,000
2,250,000
1,500,000
-
-
2,200,000
-
75,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
119,450,000
138,350,000
-
77,500,000 180,300,000
42,425,000
Page 71
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Notes to the Consolidated Financial Statements (continued)
23.
Share-based payments (continued)
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
15-Jan-15
4-Feb-18
16-Jan-15
5-Feb-18
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
21-Dec-16
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
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
21-Dec-21
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
0.26
0.26
0.09
0.00
0.10
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
0.13
0.13
0.00
0.00
0.20
0.20
0.15
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
3,000,000
1,500,000
2,500,000
1,000,000
10,000,000
5,000,000
3,000,000
0.001
0.010
0.036
0.058
0.093
0.087
0.082
0.078
0.086
0.086
0.086
0.086
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)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
4,500,000
3,000,000
20,000,000
24,400,000
9,100,000
2,000,000
150,000
Forfeited /
expired
during the
year
Number
333,333
666,667
-
-
-
-
-
-
-
-
-
-
-
2,500,000
-
-
-
-
-
-
-
4,600,000
2,500,000
-
-
Balance at
end of the
year
Number
-
-
2,500,000
-
5,000,000
5,000,000
5,000,000
5,000,000
10,000,000
3,000,000
4,400,000
3,000,000
1,500,000
-
1,000,000
10,000,000
5,000,000
3,000,000
4,500,000
3,000,000
20,000,000
19,800,000
6,600,000
2,000,000
150,000
Vested &
exercisable at
end of the
year
Number
-
-
2,500,000
-
5,000,000
5,000,000
5,000,000
5,000,000
-
3,000,000
4,400,000
3,000,000
500,000
-
-
-
-
1,500,000
-
-
-
-
-
-
-
70,400,000
63,150,000
3,500,000
10,600,000 119,450,000
34,900,000
(c)
The expense recognised in profit and loss
The expense relating to prior years share-based payments of ($788,027) was reversed into profit and loss in 2019
due to a low probability of vesting conditions to be met (2018: $1,353,549).
Page 72
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Notes to the Consolidated Financial Statements (continued)
24.
Parent Entity Disclosure
The following details information related to the parent entity, Battery Minerals Limited, as at 31 December 2019.
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
Loss after income tax
Other comprehensive income/(loss) for the year
Total comprehensive income/(loss) for the year
Guarantees
Company
31 Dec 2019
$
3,510,203
5,920,128
9,430,331
248,910
248,910
78,909,275
5,241,608
(74,969,462)
9,181,421
(36,864,911)
-
(36,864,911)
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
(6,278,922)
-
(6,278,922)
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.
25.
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.
Page 73
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Notes to the Consolidated Financial Statements (continued)
25.
Subsidiaries (continued)
Recognition of Sale of Tanga Minerals Limited
Battery Minerals Limited entered into a binding share sale agreement with Nedeel LLC on 26 September 2018 to sell
100% of the issued capital of its Mauritian subsidiary, Tanga Minerals Limited, which holds 100% of Niassa Metals
S.A (Mozambique). The deed of settlement was executed on 25 January 2019.
Battery Minerals recognizes the following estimated revenue and costs associated with the sale of Tanga Minerals
Transaction Element
Amount, $
Cash Consideration Received (USD 50,000 @ 0.7157)
Net revenue on sale of Tanga Minerals/ Niassa Metals
Dispose of net liabilities in Tanga Minerals
Dispose of net liabilities in Niassa Metals
Net gain on sale of Tanga Minerals/ Niassa Metals
69,855
69,855
(2,220)
(207,548)
(270,598)
The gain on disposal of Tanga Minerals and Niassa Metals was recognised as profit for the year in the statement of
profit or loss and other comprehensive income.
26.
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 2019
$
707,417
-
707,417
Consolidated
31 Dec 2018
$
682,022
_
-
682,022
(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 2019
Consolidated
31 Dec 2018
$
-
-
-
54,545
-
54,545
Page 74
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
Notes to the Consolidated Financial Statements (continued)
27.
Events After the End of the Reporting Period
In March 2020 Battery Minerals Limited has signed two binding agreements to acquire 67% and 33% of Gippsland
Prospecting Pty Ltd (Gippsland Prospecting), which has the sole right to apply for a highly prospective exploration
licence of Block 4 immediately adjacent to Thursday’s Gossan copper-gold project in Victoria. The acquisition is
subject to the approval of Battery Minerals shareholders and the grant of the exploration licence. As a consideration,
Battery Minerals will issue 439,363,850 ordinary shares and pay up to $500,000 to the three shareholders of
Gippsland Prospecting Pty Ltd and repay Gippsland Prospecting shareholder loans of $250,000 for past expenditure.
Battery Minerals has agreed to spend a minimum of $1.5 million on exploration and evaluation on Block 4 in the first
12 months after completion of the transaction.
On completion of the transaction Mr Kent Balas and Dr Darryl Clark will join the Battery Minerals Board, and Mr Balas
will be appointed as Managing Director of Battery Minerals. Subject to shareholder approval, Battery Minerals will
issue the new members of management 70 million Zepo incentive 5-year options with vesting conditions subject to
clear performance targets, being the definition of mineral resources, ore reserves and a decision to mine.
After the reporting date, the Company seen macro-economic uncertainty with regards to prices and demand for
battery minerals including graphite as a result of the COVID-19 (coronavirus) outbreak. Furthermore, recent global
developments and uncertainty in March 2020 has caused further abnormally large volatility in commodity and stock
markets. The scale and duration of these developments remain uncertain but could impact the Company’s ability to
finance its projects.
Page 75
Battery Minerals Limited and its controlled entities
Financial Report 31 December 2019
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 2019 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 Chairman 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
Chairman
Perth, Western Australia, 25 March 2020
Page 76
Corporate Governance Statement
Corporate Governance Statement at 24 March 2020
The Company’s corporate governance statement and Appendix 4G can be found on the
Company’s website at www.batteryminerals.com/corporate/corporate-governance/ , was
approved by the Board on 24 March 2020 and is current at 24 March 2020.
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 3rd edition unless otherwise stated.
The Company’s Corporate Governance Plan can also be found on the Company’s website at
www.batteryminerals.com/corporate/corporate-governance/ and it includes all of the
Company’s Corporate Governance policies, charters and codes of conduct.
Page 77
ASX Additional Information
ASX Additional Information as at 24 March 2020
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 is:
• 1,318,091,549 listed ordinary fully paid shares;
• 274,484,066 listed options exercisable at $0.10 and expiring on 31 July 2023; and
• 180,300,000 unlisted options
All issued ordinary fully paid shares carry one vote per share.
2.
Distribution of Equity Securities
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
Holders
119
63
297
1,384
1,201
3,064
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
Holders
-
-
2
144
245
391
Unmarketable parcels
Total Units
6,764
271,961
2,441,002
67,617,872
1,247,753,950
1,318,091,549
% Issued Share
Capital
0.00%
0.02%
0.19%
5.13%
94.66%
100.00%
Total Units
-
-
18,756
8,435,406
266,029,904
274,484,066
% Issued Share
Capital
-
-
0.01%
3.07%
96.92%
100.00%
There were 1,946 shareholders holding less than a marketable parcel of ordinary shares.
Page 78
ASX Additional Information
3.
Top 20 Largest Holders of Listed Securities
Ordinary shares (ASX Code: BAT)
Holder Name
1 FARJOY PTY LTD
2 PACIFIC DEVELOPMENT CORPORATION PTY LTD
3 MITCHELL GROUP HOLDINGS PTY LTD
4 BNP PARIBAS NOMS PTY LTD
5 GURRAVEMBI INVESTMENTS PTY LTD
6
JOHNSTON CORPORATION PTY LTD
7 HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
8 SKER HOLDINGS PTY LTD
9 CITICORP NOMINEES PTY LIMITED
10 SEYMOUR GROUP PTY LTD
11 HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
12 BT PORTFOLIO SERVICES LTD
13 RESOURCE & LAND MANAGEMENT SERVICES PTY LTD
14 MS CINDY TONKIN & MR STUART PETER TONKIN
15 CRANPORT PTY LTD
16 MR JOSEPH CAMILLERI
17 ABHI SUPER PTY LTD
18 RACELAND HOLDINGS PTY LTD
19 MR DARRYL THOMAS AYRIS
20 MR MATHEW MARIAN APPLETON
Total
Total issued capital - selected security class
Holding
%
35,000,000
27,044,381
23,598,431
20,000,000
20,000,000
17,956,079
17,000,000
13,010,161
12,923,434
12,915,639
12,600,000
12,500,000
10,944,225
9,965,371
9,000,000
8,955,456
8,600,000
7,995,191
7,791,525
199,133,245 15.11%
2.66%
2.05%
1.79%
1.52%
1.52%
1.36%
1.29%
0.99%
0.98%
0.98%
0.96%
0.95%
0.83%
0.76%
0.68%
0.68%
0.65%
0.61%
0.59%
486,933,138 36.94%
1,318,091,549 100.00%
Listed Options exercisable at $0.10 and expiring on 31 July 2023 (ASX Code: BATO)
JOHNSTON CORPORATION PTY LTD
Holder Name
1 FARJOY PTY LTD
2 D M MIDDLETON PTY LTD
3 SEYMOUR GROUP PTY LTD
4 PACIFIC DEVELOPMENT CORPORATION PTY LTD
5 RESOURCE & LAND MANAGEMENT SERVICES PTY LTD
6 MR NEIL WELSH
7 SKER HOLDINGS PTY LTD
8 ANDREW MARK WILMOT SETON
9
10 MR STEPHEN BERNARD PEART
11 HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
12 CRANPORT PTY LTD
13 M & K KORKIDAS PTY LTD
14 MR GREGORY MILTS
15 SAS INVESTMENTS PTY LTD
16 UURO PTY LTD
17 NATIONAL NOMINEES LIMITED
18 MCNEIL NOMINEES PTY LIMITED
19 NORTHCOVE INVESTMENTS PTY LTD
20 HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
Total
Total issued capital - selected security class
Holding
%
51,666,667 18.82%
7.29%
20,000,000
3.64%
10,000,000
3.64%
10,000,000
3.37%
9,249,999
2.38%
6,541,167
2.28%
6,249,999
2.27%
6,217,556
2.00%
5,499,999
1.82%
5,000,000
1.69%
4,649,207
1.33%
3,639,022
1.30%
3,556,999
1.09%
3,000,000
1.09%
3,000,000
1.09%
3,000,000
1.08%
2,974,999
0.99%
2,720,000
0.91%
2,500,000
0.91%
2,500,000
169,250,614 61.66%
274,484,066 100.00%
Page 79
ASX Additional Information
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.
5.
Unquoted securities
The following unlisted class of security are listed below:
Expiry Date
Exercise
Price, $
Balance
Vested & exercisable
30-May-20
21-Dec-21
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
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
24-Apr-24
24-Apr-24
0.09
0.10
0.15
0.20
0.25
0.15
0.15
0.15
0.15
0.15
0.20
0.94
0.20
0.13
0.13
0.13
0.00
0.00
0.20
0.20
0.15
0.00
0.00
TOTAL
6.
Substantial shareholder notices
Number
2,500,000
5,000,000
5,000,000
5,000,000
5,000,000
10,000,000
3,000,000
4,400,000
3,000,000
1,500,000
1,000,000
10,000,000
5,000,000
3,000,000
4,500,000
1,500,000
20,000,000
12,800,000
4,600,000
1,000,000
150,000
56,850,000
15,500,000
180,300,000
Number
2,500,000
5,000,000
5,000,000
5,000,000
5,000,000
-
3,000,000
4,400,000
3,000,000
500,000
-
-
-
3,000,000
2,250,000
1,500,000
-
-
2,200,000
-
75,000
-
-
42,425,000
Name
FARJOY PTY LTD
Number of
Shares
199,133,245
% Holding
15.11%
Page 80
ASX Additional Information
Restricted Securities Subject to Escrow
There are no shares subject to escrow.
7. On-market buy back
There is currently no on-market buyback program for any of Battery Minerals Limited’s listed
securities.
8. 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 2019 consistent with its business objective and
strategy.
9.
Tenure
See Operations Overview.
Page 81
www.batteryminerals.com