BOWEN COKING COAL LTD
AND CONTROLLED ENTITIES
ABN: 72 064 874 620
CONSOLIDATED FINANCIAL REPORT
FOR THE YEAR ENDED
30 JUNE 2021
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Contents
Cautionary Statements
Corporate Information
Chairman’s Letter
Review of Operations
Directors’ Report
Auditor’s Independence Declaration
Shareholder Information
Interests in Tenements
Annual Mineral Resources Statement
Consolidated Statement of Profit or Loss and Other Comprehensive Income for the Year
Ended 30 June 2021
Consolidated Statement of Financial Position as at 30 June 2021
Consolidated Statement of Changes in Equity for the Year Ended 30 June 2021
Consolidated Statement of Cash Flows for the Year Ended 30 June 2021
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2021
Directors’ Declaration
Independent Auditor’s Report
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BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Cautionary Statements
Forward-looking statements
This document may contain certain forward-looking statements. Such statements are only predictions, based
on certain assumptions and involve known and unknown risks, uncertainties and other factors, many of which
are beyond the Company’s control. Actual events or results may differ materially from the events or results
expected or implied in any forward-looking statement.
The inclusion of such statements should not be regarded as a representation, warranty or prediction with
respect to the accuracy of the underlying assumptions or that any forward-looking statements will be or are
likely to be fulfilled. Bowen Coking Coal Ltd undertakes no obligation to update any forward-looking statement
to reflect events or circumstances after the date of this document (subject to securities exchange disclosure
requirements).
The information in this document does not take into account the objectives, financial situation or particular
needs of any person or organisation. Nothing contained in this document constitutes investment, legal, tax or
other advice.
Competent Person Statement
All exploration results and Mineral Resources referred to in this Annual Report have previously been
announced to the market by the Company in accordance with the requirements of Chapter 5 of the ASX Listing
Rules and the JORC Code 2012, including as to the requirements for a statement from a Competent Person;
and the relevant announcements have been referred to in the body of the Annual Report. The Company
confirms that it is not aware of any new information or data that materially affects that information. In respect
of the Mineral Resources, all material assumptions and technical parameters continue to apply and have not
materially changed.
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BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Corporate Information
Directors and Company Secretary
Nicholas Jorss (Executive Chairman)
Gerhard Redelinghuys (Managing Director)
Neville Sneddon (Non-Executive Director)
Matthew Latimore (Non-Executive Director)
Daryl Edwards (Chief Financial Officer)
Duncan Cornish (Company Secretary)
Head Office and Registered Office
Bowen Coking Coal Ltd
Level 7, 167 Eagle Street
Brisbane QLD 4000
Tel: +61 7 3191 8413
www.bowencokingcoal.com
Auditors
RSM Australia Partners
Level 6, 340 Adelaide Street
Brisbane QLD 4000
Share Registry
Link Market Services Limited
Level 21, 10 Eagle Street
Brisbane QLD 4000
Tel: 1300 554 474
www.linkmarketservices.com.au
Stock Exchange Listing
Australian Securities Exchange Ltd
ASX Code: BCB
Australian Company Number
064 874 620
Solicitor
Colin Biggers & Paisley Pty Ltd
Level 35, 1 Eagle Street
Brisbane QLD 4000
Banker
Westpac Banking Corporation Limited
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BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Chairman’s Letter
Dear shareholders,
While the 2022 financial year has got off to a flying start with Bowen Coking Coal’s transformational acquisition
of New Hope Group’s Burton Mine and New Lenton development project, the past financial year has been an
impressive log of achievements and triumphs that have collectively propelled the company within reach of its
vision to be the Bowen Basin’s next independent coking coal producer.
The 2021 financial year started with the completion of the company’s acquisition of the Broadmeadow East
Coking Coal Project near Moranbah which has a Mining Lease with an estimated 33 million tonne JORC coal
resource and included access rights to existing haul road, coal processing and train loading infrastructure of
the Burton mine. By December, we had mobilised a drill team at the project to conduct a coal quality and
groundwater monitoring campaign which returned exceptional results from a previously unexplored area.
Permitting has advanced and an investment decision is expected before the end of the year.
At our Hillalong Project, which lies in close proximity to Glencore’s Hail Creek mine in the northern Bowen
Basin, we commenced the second phase of the farm-in to build on the maiden 43Mt JORC resource estimated
at Hillalong North.
This program followed an agreement by farm‐in partner, Sumitomo Corporation, to commit a further $2.5m to
earn an additional 5% of the project. The Japanese major previously earned 10% of the project in December
after spending $2.5m on Phase 1 and has the option to earn up to 20% in the project by spending another
$2.5m on Phase 2b which would take its total farm-in expenditure to $7.5m. This investment was a great vote
of confidence in the project.
At Isaac River, a coking coal project located close to BMAs’ Daunia Mine and Peabody’s Moorvale South
Project and regional infrastructure, we followed the submission of our Mining Lease Application with the lodging
of an Environmental Authority, a key milestone in our progression of the asset to production.
All this progress brings us considerably closer to our clear strategic goal of becoming a significant coking coal
producer in the near term. Amid tightening environmental regulations and increasing urbanisation, the call from
global steelmakers for higher quality coking coal has never been louder. As supply falls and prices rise, Bowen
Coking Coal will make the most of this significant opportunity.
Located in the heart of the world’s best coking coal province, our pipeline of projects has convenient access
to existing infrastructure and a skilled mining labour force, and are being brought into production by a proven
leadership team. This is happening as many traditional players are exiting the market, creating unprecedented
business development opportunities for our Company
There’s a strong pipeline of news flow ahead. We’ve recently been awarded preferred bidder status in the sale
of the Bluff PCI Mine and will continue to improve our portfolio at every opportunity. On behalf of the Board, I
thank you for your continued support and look forward to delivering on your investment in Bowen.
Yours faithfully
Nick Jorss
Chairman
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BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Review of Operations
During the year ended 30 June 2021, Bowen Coking Coal Limited continued to execute on its strategy of taking
the Company from a developer to a producer, by progressing its portfolio of high-quality coking coal assets
with a view to having the Broadmeadow East and Isaac River projects “shovel ready” as soon as practically
possible. Hillalong exploration continued to deliver exceptional results whilst the company continued to assess
several business development opportunities.
Highlights:
• Completed the acquisition of the 33Mt Broadmeadow East Coking Coal project and associated Mining
Lease
• Confirming high quality coking coal at Broadmeadow East
• Securing a further $2.5m investment in the Hillalong JV from Sumitomo, to earn an additional 5%
interest
• Completing coal quality confirmatory drilling at Hillalong North demonstrating the potential to produce
a low ash primary coking coal with CSN values as high as 8
• Permitting on track for Isaac River Project. Environmental Authority application submitted in October
2020 following the submission of the Mining Lease application earlier that year
• Former Stanmore chief Nicholas Jorss appointed Executive Chairman to lead the Company’s
transition to production
• Drilling at Hillalong South demonstrated the seam continuance across the southern area with a
significant intersection of 9m of coal from the target seams from as shallow as 31m deep, clearing the
way for a maiden resource estimate.
• Raising $5.25m to acquire and accelerate Broadmeadow East development and securing a further
$2.1m in funding though the exercise of Options.
PROJECTS
Broadmeadow East Coking Coal Project (ML 70257)
Located around 25km north-east of the coal mining town of Moranbah, Broadmeadow East is the Company’s
most advanced coking coal project, which includes a granted Mining Lease and access to infrastructure.
In a significant milestone, the Company announced in late June 2020, that it had executed binding agreements
with Peabody (Burton Coal) Pty Ltd, a wholly owned subsidiary of US headquartered Peabody Energy
Corporation, whereby BCB would acquire the Broadmeadow East coking coal project, located within
undeveloped Mining Lease 70257 (“Project” or “Broadmeadow East”).
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BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Review of Operations
Project location
On 30 September 2020, all conditions relating to the acquisition of Broadmeadow East were satisfied and the
deal was completed.
The transaction includes access rights to both the New Lenton Joint Venture Coal Handling and Preparation
Plant (“CHPP”) and the Train Load Out Facility (“TLO”), which are connected by an established haul road
passing immediately adjacent to ML 70257. The Company has secured throughput capacity of a minimum of
1Mtpa, with the ability to increase this capacity to a total of 2 Mtpa, subject to agreement.
The Company’s independent consultants, Xenith Consulting, were commissioned to review all available and
relevant data and completed a Resource Estimate of 33Mt, in accordance with the JORC Code (2012).
BCB commenced analysing the washability data and determined that the coal can be washed at lower density
levels (albeit at lower primary yields) to create a higher quality coking coal at ~8.7% ash with CSN as high as
7 whilst still producing a high-energy secondary thermal coal.
Post completion of the Broadmeadow East acquisition, the Company mobilised a drilling team to conduct a
coal quality and groundwater monitoring campaign. The primary purpose of the program was to obtain up to
six core samples for detailed coal quality analysis on a ply-by-ply basis in order to optimise the mine plan, as
well as providing valuable information for marketing studies and potential off-take agreements.
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BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Review of Operations
Locations and intersections of core holes of the 2020/21 exploration program
The results of the coal quality exploration program demonstrated the flexibility of the resource to produce a
primary coking coal product of either high quality (7.5% ash, CSN 7.5) or high yield (9.2% ash, CSN 4.5). In
both of the primary product cases, the secondary energy coal created from the primary coking coal discard
has a calorific value of more than 6,500kcal/kg (ad) which is also a sought-after product for the export coal
markets. Total laboratory yield for the combined products ranges between 77% and 86%.
Part of this campaign, BCB undertook drilling in a previously unexplored area south of the existing Measure
Resource of the project which confirmed that the Leichardt seam extends further south, within the current
Mining Lease (CQBE006 and CQBE008).
The results also confirmed BCB’s view that the lower two thirds section of the 3.8m thick Leichhardt seam
contains better coking properties and a higher yield and therefore justifies investigation of a two-pass mining
method. It was also confirmed that the lower section contains lower impurities such as phosphorus and
therefore supports a higher quality coking coal. Previous coal quality analysis had been limited to an aggregate
total seam analysis.
Studies have also commenced to understand the concept for a shallow, low cost, underground operation as a
second phase of the project. Initial outcomes are encouraging and warrant further investment into the Inferred
area of the resource.
Mine planning studies have been undertaken by Xenith Consulting and field work for the EA amendment has
been managed by Nitro Solutions. Final permitting and a “Decision to Mine” is planned for the second half of
the year.
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BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Review of Operations
Hillalong Coking Coal Project (EPC 1824 & EPC 2141)
The Hillalong Coking Coal Project (“Hillalong”) is located in the northern Bowen Basin approximately 105 km
west‐southwest of Mackay.
The project is currently the subject of a farm-in agreement (“Hillalong Farm-In”) with the Sumitomo Corporation
(“Sumitomo”) which earned a 10% interest in the project post expending $2.5m on the successful Phase 1
exploration program completed earlier in 2020.
Significantly, in March 2021, Sumitomo confirmed its commitment to continue farming into the Hillalong project
through a further expenditure of $2.5 million in the Phase 2a exploration program to earn an additional 5%
interest. Sumitomo now has the ability to earn an additional 5% in Hillalong by funding a further A$2.5m of
exploration in Phase 2b. This will be subject to the success of the Phase 2a program. The Hillalong Farm-In is
in the process of being converted into a formal joint venture.
Sumitomo already has interests in Clermont, Rolleston and Oaky Creek mines, as well as Glencore’s Hail
Creek Mine which neighbours the Hillalong tenements and produces more than five million tonnes of coking
coal annually.
The Phase 1 exploration program resulted in a maiden JORC Resource of 43Mt and confirmation that the
project has the potential to produce a low ash, high quality coking coal. In August 2020, washability and coal
quality results received from drilling at Hillalong North confirmed the potential for high quality coking coal at
excellent yields. Laboratory results demonstrated that the Elphinstone seam has the potential to produce a
single primary coking coal with 10.5% ash at an average yield of 84% over the deposit. The Hynds Upper
seam has the potential to produce a high quality, 8.5% ash primary coking coal product with a secondary high
energy thermal coal at a combined yield of 87%.
The Phase 2a exploration program comprises three drill holes in the northern area to extend the resources in
the Rangal Coal Measures and eight drill holes in the southern area to target the definition of a maiden resource
and to test the existence of the Moranbah Coal Measures along the eastern margin of the project. A 37 km
seismic survey is also part of the program.
Locations of the holes of the 2021 exploration program targeting the Rangal Coal Measures
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BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Review of Operations
In June 2021, BCB announced significant early results from the drilling. Hole HIL055 encountered both the
target Elphinstone and Hynds Upper seams at a combined thickness of more than seven metres, which
provides a good indication of the seam continuance over that area of the Hillalong project.
Drill Hole HIL054, in the southern part of the permit, intersected a 9m thick coalesced Elphinstone and Hynds
Upper seam, along strike from the highest quality area observed in the previous campaign. Based on the
previous exploration program and coal quality and washability results, there is potential to produce a Mid
Volatile Matter (25% a.d. basis) coking coal from the Hillalong South project, which complements the other
products within the Bowen Coking Coal portfolio, including the Low Volatile Matter coking coals of
Broadmeadow East.
Scout drilling towards the east of the project encountered several coal seams which were interpreted to be the
upper seams of the Moranbah Coal Measures, which are generally higher in ash and therefore not of economic
interest.
Isaac River Coking Coal Project (MDL 444, EPC 830, MLA 7000062)
The Isaac River Coking Coal Project (“Isaac River”) covers an area of 14 km2 in the Bowen Basin in Central
Queensland, approximately 30 km west of Moranbah. The project is in close proximity to BMA’s (BHP
Mitsubishi Alliance) Daunia Mine, and Peabody’s Moorvale South Project.
During the period, BCB progressed the permitting process for Isaac River. In October 2020 the Company
announced it had lodged a site-specific Environmental Authority (“EA”) application for the permit with the
Queensland Government Department of Environment and Science. Further to the lodging of the Mining Lease
Application (MLA) in Q1 2020, the lodgement of the EA application for Isaac River represented a significant
milestone in the critical path to converting the project into a producing asset. Approvals are expected in the
second half of this year.
The Initial Development Plan submitted with the MLA proposed a contractor-operated opencut operation along
with highwall/auger mining, utilising offsite infrastructure and toll washing of run-of-mine coal at a nearby
facility. Discussions on access to third party infrastructure are ongoing in advance of a planned start to mining
in the first half of 2022.
Corporate
Board Changes
Long serving Directors Steven Formica and James Agenbag both tendered their resignations, effective 31
October 2020.
In February 2021, BCB announced the appointment of coal industry veteran, Nicholas Jorss, as Executive
Chairman to lead the Company’s transition from explorer to coking coal producer. Mr Jorss was founding
Managing Director of Stanmore Coal and successfully led this company to become a significant Bowen Basin
coking coal producer. He was previously a Non-Executive Director. Mr Jorss replaced Neville Sneddon who
remains on the Board in the capacity of Non-Executive Director.
In February 2021, Daryl Edwards was appointed to the role of Chief Financial Officer (CFO). Mr Edwards is a
Chartered Accountant with over 22 years’ experience in the mining and manufacturing industries, including
seven years as CFO and Head of Corporate Development for Universal Coal Plc.
In May 2021, Blair Sergeant moved from an Executive role to Non-Executive Director and subsequently
resigned as a Director on 17 September 2021.
The Board would like to extend their gratitude to Steve, James and Blair for the valuable contribution they
made during their tenure.
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BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Review of Operations
Placements Raise $5.25m (before costs)
The Company completed two private placements during the period raising a total of $5.25m (both at a price of
$0.05 per share). Funds raised under the placements were applied to the acquisition and transaction costs of
the Broadmeadow East project, related environmental and mining studies, and to accelerate the Broadmeadow
East development program. Funds were also allocated for general working capital purposes, including Isaac
River permitting and business development.
Exercise of Options
In December 2020, the Company received notice of exercise for a total of 30 million options with an expiry
date of 12 December 2020, raising total proceeds of $900,000. Importantly, the Company’s Executive
Chairman, Mr Nicholas Jorss, exercised over two thirds of those options, personally committing $550,000 of
the aforementioned $900,000 received and increasing his direct and indirect shareholding in the Company to
over 60,957,120 shares, representing 6.5% of the Company’s outstanding shares on issue at the time.
In February 2021, an additional 4,200,000 unlisted options held by former Directors were exercised into
ordinary shares, raising $141,960, and 12,000,000 performance rights were issued to Mr. Edwards. On 1
March 2021, 4,000,000 performance rights, that had previously vested, were converted into ordinary shares
for Mr McKee.
Between March and June, Board and management exercised an additional 31,500,000 options with a strike
price of 3.38c (issued in Q2 2019, expiring end Q2 2021) which resulted in a further cash injection of
$1,064,700 to the Company.
COVID-19 Impact
The COVID-19 pandemic impacted the Company on several fronts during the period. Both the Broadmeadow
East and Hillalong exploration programs were impacted by inter-state travel restrictions for the exploration
teams and also additional costs to keep the teams on site and compliant with Queensland Government
regulations. International travel restrictions and working from home policies by larger corporations impacted
Phase 2 Farm-in negotiations with Sumitomo Corporation, the completion of the Broadmeadow East
transaction with Peabody Energy and other interactions with larger companies. However, the Company
advanced these negotiations and discussions via telephone and video conferencing with limited face to face
interaction. Social distancing restrictions and inter-state travel restrictions resulted in roadshows, shareholder
meetings and board meetings being scheduled as virtual events.
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BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Directors’ Report
The directors submit their report on the consolidated entity (“Group”) consisting of Bowen Coking Coal Ltd and
the entities it controlled at the end of, and during, the financial period ended 30 June 2021.
Directors
The following persons were directors of Bowen Coking Coal Ltd during the financial period and up to the date
of this report, unless otherwise stated:
Nicholas Jorss
Gerhard Redelinghuys
Matthew Latimore
Neville Sneddon
Blair Sergeant
Steven Formica
James Agenbag
Executive Chairman (moved from Non-Executive Director to Executive Chairman
on 25 February 2021)
Managing Director
Non-Executive Director
Non-Executive Director (moved from Non-Executive Chairman to Non-Executive
Director on 25 February 2021)
Non-Executive Director (moved from Executive to Non-Executive on 1 May 2021
and resigned as a Director on 17 September 2021)
Non-Executive Director (resigned 31 October 2020)
Non-Executive Director (resigned 31 October 2020)
Information on Directors
The board has a strong combination of technical, managerial and capital markets experience. Expertise and
experience include operating and coal exploration. The names and qualifications of the current directors are
summarised as follows:
Nicholas Jorss – Executive Chairman
Qualifications
Appointment Date
Resignation Date
Length of Service
BE (Hons) Civil, MBA, GDip App Fin (Sec Inst)
12 December 2018
N/A
2.5 years
Current ASX Listed Directorships
Ballymore Resources Limited
Former ASX Listed Directorships
Stanmore Coal Limited
Mr Jorss is the founding Managing Director of Stanmore Coal Ltd (via St Lucia). Mr Jorss served on Stanmore’s
Board from its formation in June 2008 through to 26 November 2016. He has over 25 years’ experience in
investment banking, civil engineering, corporate finance and project management. Mr Jorss was instrumental
in the success of Stanmore Coal Ltd, which currently has a market value of around $230m. As the Founding
Managing Director, Mr Jorss led Stanmore’s growth from a coal exploration company to a profitable, mid-tier
producer. In his prior roles in investment banking (as a director of Pacific Road Corporate Finance) he has
been involved in leading advisory mandates with corporate, government and private equity clients across
industry sectors ranging from resources to infrastructure.
Prior to this Mr Jorss was an engineer with Baulderstone Hornibrook where he delivered significant
infrastructure and resource projects over a period of approximately 8 years. Mr Jorss is a founding shareholder
and Director of St Lucia Resources, Konstantin Resources, Ballymore Resources and Wingate Capital. He
was previously a Director of Kurilpa Uranium, Vantage Private Equity Growth, Vantage Asset Management
and WICET Holdings Pty Ltd. Mr Jorss holds a Bachelor with Honours in Civil Engineering from the University
of Queensland, a Master of Business Administration from the University of NSW (AGSM) and a Graduate
Diploma of Applied Finance and Investment.
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BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Directors’ Report
Gerhard Redelinghuys – Managing Director
Qualifications
Appointment Date
Resignation Date
Length of Service
B. Comm. Acc, Hons, B. Compt, GAICD
27 September 2017
N/A
3.75 years
Current ASX Listed Directorships
Former ASX Listed Directorships
Nil
Nil
Mr Redelinghuys is the Managing Director of Cape Coal and has 24 years’ experience in financial and project
development within the mining sector. After studying finance at the University of Pretoria in South Africa, he
joined PricewaterhouseCoopers, before commencing his employment with EXXARO Resources Ltd (former
ISCOR and KUMBA Resources) in 1995.
Since 1995 he has held various senior management positions in the corporate office, as well as both open cut
and underground mining operations in South Africa. He has held directorships in Australia, including the
position of Managing Director of Exxaro Australia Pty Ltd. In addition to his business analysis experience, Mr
Redelinghuys has extensive experience in mining project acquisitions and deal making on an international
level. He was also the owner’s representative on a multi-billion dollar underground coal project in Queensland
until 2015 before founding Bowen Coking Coal Ltd. Mr Redelinghuys is also a graduate member of the
Australian Institute of Company Directors.
Matthew Latimore - Non-Executive Director
Qualifications
Executive Education Program, Columbia University Graduate School of
Business, New York.
Master of Business (Executive), Australian Graduate School of Management
Advanced Diploma of Leadership and Management, The University of
Western Australia.
Bachelor of International Business, Griffith University.
Appointment Date
Length of Service
Current ASX Listed Directorships
Former ASX Listed Directorships
17 June 2020
1 year
Nil
Nil
Mr Latimore is the President and Founder of M Resources, an entity which specialises in marketing coking
coal, including hard coking coal, semi hard coking coal, semi soft coking coal and PCI coals for steel
manufacturing. Mr Latimore held the position of General Manager Sales and Marketing for Wesfarmers
Curragh mine and was responsible for global sales of Curragh metallurgical coal products to international steel
mills and thermal coal to domestic and international power utilities, rail and port and quality and finance
functions. Mr Latimore was a Director of Curragh Coal Sales. Prior to joining Wesfarmers in early 2001, Mr
Latimore held various positions with Mitsui & Co (Australia) Pty Ltd.
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BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Directors’ Report
Neville Sneddon - Independent Non-Executive Director
Qualifications
Appointment Date
Resignation Date
Length of Service
B. Eng (Mining)(Hons), M. Eng, MAusIMM, Grad AICD
12 December 2018
N/A
2.5 years
Current ASX Listed Directorships
Nil
Former ASX Listed Directorships
Stanmore Coal Limited
A mining engineer with over 40 years’ experience in most facets of the Queensland (QLD) and New South
Wales (NSW) resource sectors, and as the recently retired Chairman of Stanmore Coal Ltd, Mr Sneddon brings
substantial Board and industry knowledge to the Company. He has developed and operated both underground
and open cut mines working for Coal & Allied in the Hunter Valley and from 1997 worked in a senior role in the
NSW Mines Inspectorate, covering operations in all forms of mining in the state.
Moving to Queensland in 1999, Mr Sneddon accepted the position of Chief Operating Officer with Shell Coal
which was acquired by Anglo American’s Australian coal operations the following year. Leaving as CEO in
2007, he held several Board positions with mining and infrastructure companies including Chairman of the
operating company at Dalrymple Bay Coal Terminal near Mackay and Director of Port Waratah Coal Services,
a major coal export facility at Newcastle. Mr Sneddon has also been a member of the Boards of the QLD,
NSW and National Mining Councils. His expertise has been sought by several government committees such
as the NSW Mine Subsidence Board, NSW Mines Rescue Board, QLD Ministerial Coal Mine Safety Advisory
Committee and the joint federal/state advisory committee.
Blair Sergeant – Non-Executive Director
Qualifications
Appointment Date
Resignation Date
Length of Service
B. Bus, PostGradDip (CorpAdmin), MAICD, AGIA, ACIS, ASCPA
28 September 2018
17 September 2021
2.75 years
Current ASX Listed Directorships
Former ASX Listed Directorships
Nil
Nil
Mr Sergeant is an experienced mining executive, having been the former Founding Managing Director of
Lemur Resources Limited, an ASX listed coal exploration and development company, as well as the former
Finance Director of Coal of Africa Limited, growing the company from a sub-$2m market capitalisation to over
$1.5b at its peak. During his career, Mr Sergeant has also held the position of Managing Director, Non-
Executive Director and/or Company Secretary for numerous listed entities across a broad spectrum of industry.
Mr Sergeant graduated from Curtin University, Western Australia with a Bachelor of Business and
subsequently, a Post Graduate Diploma in Corporate Administration. He is a member of the Institute of
Chartered Secretaries and Administrators and the Australian Institute of Company Directors.
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BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Directors’ Report
Steven Formica – Independent Non-Executive Director
Qualifications
Appointment Date
Resignation Date
Length of Service
N/A
4 August 2015
31 October 2020
5.25 years
Current ASX Listed Directorships
Former ASX Listed Directorships
Nil
Nil
Mr Formica is a successful businessman with over 30 years' experience. He has been involved in multiple
business ventures either as a founding shareholder, operational Managing Director or as a Non-Executive
Director. Mr Formica is currently a director of both FPG Projects and Viridian Property Group, both successful
property developers.
James Agenbag - Independent Non-Executive Director
Qualifications
Appointment Date
Resignation Date
Length of Service
Current ASX Listed Directorships
Former ASX Listed Directorships
B. Eng (Chemical Engineering), MBA
27 September 2017
31 October 2020
3.1 years
Nil
Nil
Mr Agenbag has 15 years’ experience in the mining industry covering all phases of business and project
development, process design, including the commissioning and optimisation of processing facilities across
multiple commodities. After completing his Chemical Engineering degree at the University of Stellenbosch in
2003, Mr Agenbag worked as a process design engineer at EPCM companies including GRD Minproc Limited
and DRA Global.
In 2008, Mr Agenbag moved to Australia to help build DRA’s Brisbane office. His responsibilities included
research and development of new business and client management in Southern Africa, Australia and
Indonesia. Mr Agenbag also has substantial experience in beneficiation optimisation with emphasis on various
technologies including some technologies where he jointly holds patent rights. Mr Agenbag has delivered
technical papers within his area of expertise in the minerals processing field. He held a position responsible
for the process engineering discipline across Peabody Energy Australia PCI Pty Ltd coal projects, and has
been a Director of Cape Coal since 2012.
Mr Agenbag has been accredited with ECSA as a Professional Engineer. He is a Member of IEAust (Chem)
and is an active Member of the South African and Australian Coal Processing Societies.
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BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Directors’ Report
Company Secretary
Duncan Cornish –Company Secretary
Appointment Date
Resignation Date
Length of Service
1 May 2019
N/A
2.2 years
Current ASX Listed Directorships
Former ASX Listed Directorships
Nil
Nil
Mr Cornish was the founding CFO and Company Secretary for Stanmore Coal Ltd (ASX:SMR), Waratah Coal
Ltd (TSX and ASX:WCI) and Cokal Ltd (ASX:CKA) and is a Chartered Accountant with significant experience
as a public company CFO and Company Secretary, focused on finance, administration and governance roles.
He has more than 20 years’ experience in the accountancy profession both in England and Australia, mainly
with the accountancy firms Ernst & Young and PricewaterhouseCoopers. He has extensive experience in all
aspects of company financial reporting, corporate regulatory and governance areas, business acquisition and
disposal due diligence, capital raising, company initial public offerings and company secretarial responsibilities,
and has served as CFO and/or Company Secretary of several Australian and Canadian public companies.
Chief Financial Officer
Daryl Edwards –Chief Financial Officer
Appointment Date
Resignation Date
Length of Service
Current ASX Listed Directorships
Former ASX Listed Directorships
2 February 2021
N/A
5 months
Nil
Nil
Mr. Edwards is a Chartered Accountant with over 22 years’ experience in the mining and manufacturing
industries. He has held various executive positions including CEO of a private Australian coal explorer, Pioneer
Coal, and CFO and Head of Corporate Development for Universal Coal plc (ASX:UNV) for over 7 years, where
he managed the commercialisation of the 4Mpta Kangala Colliery and the 3.3Mtpa New Clydesdale Colliery.
Previously, Mr Edwards was CFO at Asenjo Energy, a Botswana-based coal exploration and development
company, held privately by Aquila Resources, Sentula Mining and Jonah Capital.
Page 15
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Directors’ Report
Interests in Securities
As at the date of this report, the interests of each director in shares and options issued by the Company are
shown in the table below:
Directors
Shares
Nicholas Jorss
66,036,882
Gerhard
Redelinghuys
127,237,358(1)
Matthew Latimore
171,622,455
Neville Sneddon
7,454,365
Notes:
(1) 119,849,774 of these shares are held by both Gerhard Redelinghuys and James Agenbag through their respective associations
with Cape Coal Pty Ltd
Principal Activities
The principal activity of the Group during the period was the exploration and development of coal projects with
a primary focus on Metallurgical coal.
Corporate
Bowen Coking Coal Ltd ACN 064 874 620 was incorporated as an Australian public company limited by shares
on 6 July 1994, listing on the Australian Stock Exchange shortly thereafter.
Dividends Paid or Recommended
There were no dividends paid or recommended during the financial year.
Review of Operations
Information on the operations of the Group during the financial year and up to the date of this report is set out
separately in the Annual Report under Review of Operations.
Operating Results
The Group’s operating loss for the financial year was $3,224,368 (2020: $2,057,812). The increased loss was
caused principally by:
• General corporate and administrative expenses ($1,699,722);
• Exploration expenses ($25,784);
• Employee benefits expense ($896,093); and
• Share-based payments ($506,904).
Review of Financial Condition
Capital Structure
As at 30 June 2021 the Company had 978,462,262 ordinary shares, 20,000,000 performance rights and
3,400,000 options on issue.
Page 16
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Directors’ Report
During the year ended 30 June 2021, the following shares were issued:
• 105,000,000 shares were issued (raising $ 5,250,000);
• 65,700,000 shares were issued following option exercises (raising $2,106,660); and
• 4,000,000 shares were issued following the exercise of vested performance rights.
During the year ended 30 June 2021 12,000,000 performance rights were issued with various performance
hurdles and test dates.
Financial Position
At 30 June 2021, the Group’s net assets totalled $14,948,951 (2020: $10,480,649) which included cash assets
of $2,997,030 (2020: $2,394,319). The movement in net assets largely resulted from the following factors:
• Operating losses of $3,224,368;
• Cash outflows from operating activities of $2,710,812;
• Cash outflows from investing activities of $3,360,228; and
• Net cash inflows from financing activities of $6,673,751.
Throughout the year the Group focussed on exploration and development on the Group’s coal projects.
The Group’s working capital, being current assets less current liabilities has increased from $1,363,381 in
2020 to $2,175,369 in 2021.
Treasury policy
The Group does not have a formally established treasury function. The Board is responsible for managing the
Group’s finance facilities. The Group does not currently undertake hedging of any kind and is not currently
directly exposed to material currency risks.
Liquidity and funding
The Group has sufficient funds to finance its operations and exploration activities, and to allow the Group to
take advantage of favourable business opportunities, not specifically budgeted for, or to fund unforeseen
expenditure.
Significant Changes in State of Affairs
Other than the securities issued as noted above, there were no other significant changes in the state of affairs
of the Group in the financial year.
Subsequent Events
On 30 July 2021 the Company announced that it had been awarded preferred bidder status in the sale process
for the Bluff PCI Mine. The Company has entered into a terms sheet pursuant to which it has paid a $250,000
deposit, which provided exclusive rights to conduct detailed due diligence over a period of 4 weeks and to
advance towards binding transaction documents.
On 4 August 2021 the Company announced that it had signed a Binding Term Sheet with New Hope
Corporation Limited (‘NHC’) to acquire 100% of the shares in New Lenton Coal Pty Ltd (‘New Lenton’) (which
currently owns a 90% interest in the Lenton Joint Venture) (‘Lenton JV’, the ‘Acquisition’). The Company has
agreed to pay New Hope Corporation a $20,000,000 upfront payment (of which $500,000 was paid upon
signing of the Binding Term Sheet and up to $10,000,000 can be in Bowen Coking Coal Limited shares at the
Company’s election); up to $7,500,000 in deferred milestone payments linked to both production ramp-up and
time-based payments (24 and 36 months) plus up to $70,000,000 in predominantly price-linked royalty
payments on 90% of all coal produced from the Lenton Joint Venture.
Page 17
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Directors’ Report
The transaction is conditional upon:
-
New Hope Corporation and Bowen Coking Coal finalising and entering into formal transaction
documents to give effect to the Binding Term Sheet;
Bowen Coking Coal (and, potentially, New Hope Corporation) agreeing acceptable commercial
arrangements with MPC Lenton Pty Ltd, a subsidiary of Formosa Plastics Group (“Formosa’) in relation
to the future ownership, operation and funding arrangements for the Lenton Joint Venture assets; and
acceptable arrangements being put in place under the Queensland Financial Provisioning regime for
resources projects in respect of the outstanding Burton rehabilitation obligations.
-
-
The formal documents will provide that completion is subject to Bowen Coking Coal Limited shareholder
approvals required under the ASX Listing Rules.
On 5 August 2021 the Company issued 2,700,000 fully paid ordinary shares on the exercise of unlisted options,
with 2,100,000 shares issued at $0.07 and 600,000 shares issued at $0.08 per share.
On 10 August 2021 the Company completed a private placement of 149,253,731 shares at $0.067 per share,
raising $10,000,000.
On 30 August 2021, the Company completed an Entitlement Offer (‘Offer’), being a fully underwritten pro-rata
non-renounceable entitlement issue of Shares, of 1 New Share for every 12 Shares held by Eligible
Shareholders on the Record Date, at an Issue Price of $0.067 per New Share, to raise $5,478,185 (before
costs of the Offer). Accordingly on the same date, the Company issued 81,763,969 new shares at $0.067 per
share.
In addition, on 30 August 2021 the Company applied for the issue 30,000,000 unlisted options each
exercisable at $0.10 per share on or before 31 August 2024. 21,000,000 unlisted options were issued on this
date with a further 9,000,000 unlisted options to be issued at a future date subject to shareholder approval.
During the reporting period the outbreak of what is known as the COVID-19 pandemic continued to spread,
resulting in significant volatility with worldwide economies as well as there being Government imposed social
distancing guidelines. Subsequent to the reporting period the COVID-19 pandemic has remained prevalent,
and this may impact the results of operations of the Company in future reporting periods. Given the stage of
the pandemic, the company is not in a position to reliably estimate this impact.
Other than the matters noted above, there are no material matters or circumstances that have arisen since the
end of the year which significantly affected or may significantly affect the operations of the Group, the results
of those operations, or the state of affairs of the Group in future financial years.
Business Results
The prospects of the Group in progressing their exploration projects may be affected by a number of
factors. These factors are similar to most exploration companies moving through exploration phase and
attempting to get projects into development. Some of these factors include:
▪ Exploration - the results of the exploration activities may be such that the estimated resources are
insufficient to justify the financial viability of the projects. The Group undertakes extensive exploration
and product quality testing prior to establishing JORC compliant resource estimates and to (ultimately)
support mining feasibility studies. The Group engages external experts to assist with the evaluation of
exploration results where required and utilises third party competent persons to prepare JORC
resource statements or suitably qualified senior management of the Group. Economic feasibility
modelling of projects will be conducted in conjunction with third party experts and the results of which
will usually be subject to independent third party peer review.
▪ Social Licence to Operate – the ability of the Group to secure and undertake exploration and
development activities within prospective areas is also reliant upon satisfactory resolution of native
title and (potentially) overlapping tenure. To address this risk, the Group develops strong, long term
Page 18
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Directors’ Report
effective relationships with landholders with a focus on developing mutually acceptable access
arrangements. The Group takes appropriate legal and technical advice to ensure it manages its
compliance obligations appropriately.
▪ Environmental - All phases of mining and exploration present environmental risks and hazards. The
Group’s operations are subject to environmental regulations pursuant to a variety of state and
municipal laws and regulations. Environmental legislation provides for, among other things, restrictions
and prohibitions on spills, releases or emissions of various substances produced in association with
mining operations. Compliance with such legislation can require significant expenditures and a breach
may result in the imposition of fines and penalties, some of which may be material. Environmental
legislation is evolving in a manner expected to result in stricter standards and enforcement, larger fines
and liability and potentially increased capital expenditures and operating costs. Environmental
assessments of proposed projects carry a heightened degree of responsibility for companies and
directors, officers and employees. The Group assesses each of its projects very carefully with respect
to potential environmental issues, in conjunction with specific environmental regulations applicable to
each project, prior to commencing field exploration. Periodic reviews are undertaken once field
exploration commences.
▪ Safety - Safety is of critical importance in the planning, organisation and execution of the Group’s
exploration and development activities. The Group is committed to providing and maintaining a
working environment in which its employees are not exposed to hazards that will jeopardise an
employee’s health, safety or the health and safety of others associated with our business. The Group
recognises that safety is both an individual and shared responsibility of all employees, contractors and
other persons involved with the operation of the organisation. The Group has a Safety and Health
Management system which is designed to minimise the risk of an uncontrolled safety and health event
and to continuously improve the safety culture within the organisation.
▪ Funding - the Group will require additional funding to continue exploration and potentially move from
the exploration phase to the development phases of its projects. There is no certainty that the Group
will have access to available financial resources sufficient to fund its exploration, feasibility or
development costs at those times.
▪ Market - there are numerous factors involved with exploration and early stage development of its
projects, including variance in commodity price and labour costs which can result in projects being
uneconomical.
Environmental Issues
The Group is subject to significant environmental regulations under the (Federal, State and local) laws in
Australia. The directors monitor the Group’s compliance with environmental obligations. The directors are not
aware of any compliance breach arising during the year and up to the date of this report.
Native Title
Mining tenements that the Group currently holds, may be subject to Native Title claims. The Group has a
policy that is respectful of the Native Title rights and will, as required, negotiate with relevant indigenous bodies.
Page 19
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Directors’ Report
Remuneration Report (Audited)
This report details the nature and amount of remuneration for each director and other key management
personnel.
The names of key management personnel of Bowen Coking Coal Ltd who have held office during the financial
year are:
Nicholas Jorss
Executive Chairman
Gerhard Redelinghuys
Managing Director
Matthew Latimore
Non-Executive Director
Neville Sneddon
Non-Executive Director
Steven Formica
Non-Executive Director (resigned 31 October 2021)
James Agenbag
Non-Executive Director (resigned 31 October 2021)
Blair Sergeant
Non-Executive Director (resigned 17 September 2021)
Duncan Cornish
Company Secretary
Daryl Edwards
Chief Financial Officer
The Group’s remuneration policy seeks to align director and executive objectives with those of shareholders
and the business, while at the same time, recognising the early development stage of the Group and the
criticality of funds being utilised to achieve development objectives. The board believes the current policy has
been appropriate and effective in achieving a balance of these objectives.
The Group’s remuneration policy provides for long-term incentives to be offered through a director and
employee equity incentive plan. Options, shares or performance rights may be granted under this plan to align
directors’, executives’, employees’ and shareholders’ interests. Two methods may be used to achieve this aim,
the first being securities that vest upon reaching or exceeding specific predetermined objectives, and the
second being options granted with higher exercise prices (than the share price at issue) rewarding share price
growth.
The board of directors is responsible for determining and reviewing the Group’s remuneration policy,
remuneration levels and performance of both executive and non-executive directors. Independent external
advice will be sought when required. No independent external advice was sought during the current year.
Performance-Based Remuneration
Performance-based remuneration includes both short-term and long-term incentives and is designed to reward
key management personnel for reaching or exceeding specific objectives or as recognition for strong individual
performance. Short-term incentives are available to eligible staff of the Group and may be comprised of cash
bonuses, determined on a discretionary basis by the board. No short-term incentives were made available
during the year.
Long-term incentives are currently comprised of share options and performance rights, which are granted from
time-to-time to encourage sustained strong performance in the realisation of strategic outcomes and growth in
shareholder value.
The exercise price of the options is determined after taking into account the underlying share price
performance in the period leading up to the date of grant and if applicable, performance conditions attached
to the share options. Subject to specific vesting conditions, each option is convertible into one ordinary share.
The Group’s policy for determining the nature and amount of remuneration of board members and key
executives is set out below.
Page 20
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Directors’ Report
Remuneration Report (Audited) (Continued)
Directors
Board policy is to remunerate non-executive directors at market rates for comparable companies for time,
commitment and responsibilities. The maximum aggregate amount of fees that can be paid to non-executive
directors is subject to approval by shareholders at the Annual General Meeting and is not linked to the
performance of the Group. The maximum aggregate amount of fees that can be paid to non-executive directors
approved by shareholders is currently $300,000. One-third, by number, of non-executive directors retires by
rotation at the Company’s Annual General Meeting. Retiring directors are eligible for re-election by
shareholders at the Annual General Meeting of the Company. The appointment conditions of the non-executive
directors are set out and agreed in letters of appointment.
Executives
The remuneration structure for executives is based on a number of factors, including length of service,
particular experience of the individual concerned, and overall performance of the Group.
The executives receive payments provided for under an employment or service agreement, which may include
cash, superannuation, short-term incentives and equity-based performance remuneration.
The Company has entered into an employment agreement with Gerhard Redelinghuys on the following
material terms.
• Position: Managing Director and CEO.
• Commencement Date: 1 June 2020.
• Notice period: The Company must give 3 months’ notice to terminate the agreement other than for
cause. The executive must give 3 months’ notice to terminate the agreement.
• Remuneration: $320,000 including superannuation per annum, indexed per CPI Brisbane on 1 July
each year, plus an allowance of $5,000 per annum for death & disability insurance.
• Other industry standard provisions for senior executive of a public listed company are included in the
agreement.
The Company amended an employment agreement with Nicholas Jorss on the following material terms.
• Position: Executive Chairman.
• Commencement Date: 24 February 2021.
• Notice period: The Company must give 3 months’ notice to terminate the agreement other than for
cause. The executive must give 3 months’ notice to terminate the agreement.
• Remuneration: $200,000 per annum including superannuation per annum, indexed per CPI Brisbane
on 1 July each year.
The Company has a services agreement with Corporate Administration Services Pty Ltd (“CAS”) and Duncan
Cornish, the Company’s Company Secretary. Both the Company and CAS are entitled to terminate the
agreement upon giving not less than three months’ written notice. The base fee under the services agreement
is $36,000 per annum, in effect from 1 April 2021. The agreement also provides for additional services to be
charged as agreed in advance.
The Company has a services agreement with Protea Resources Pty Ltd (“Protea”) and Daryl Edwards, the
Company’s CFO. Both the Company and Protea are entitled to terminate the agreement without cause at any
time upon giving not less than one month written notice. The base fee under the services agreement is $175
per hour, in effect from 20 January 2021. The agreement also provides for additional services to be charged
as agreed in advance.
Page 21
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Directors’ Report
Remuneration Report (Audited) (Continued)
Remuneration Details of Key Management Personnel
The remuneration of the key management personnel of Bowen Coking Coal Ltd for the year ended 30 June
2021 was as follows:
Short Term Benefits
Post-Employment
Equity-settled Share-
based Payments
Total
Performance
related %
Key
Management
Personnel
Salary &
Fees
Non-
cash
Benefits
Super-
annuation
Provision for
leave
entitlements
Shares
Options
/Rights
$
$
$
$
$
N. Jorss
117,384
G. Redelinghuys
298,306
M. Latimore
N. Sneddon
B. Sergeant
S. Formica (1)
J. Agenbag (1)
D. Cornish
D. Edwards (2)
Total
34,521
51,479
187,721
13,140
12,000
116,000
165,900
996,451
-
-
-
-
-
-
-
-
-
-
$
10,495
21,694
3,279
4,891
14,952
-
-
-
-
-
17,978
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
30,763
-
-
-
-
-
114,671
145,434
$
127,879
337,978
68,563
56,370
202,673
13,140
12,000
116,000
280,571
1,215,174
%
0%
0%
45%
0%
0%
0%
0%
0%
41%
55,311
17,978
(1) Resigned on 31 October 2020
(2) Appointed on 2 February 2021 (the above amount includes fees received prior to this date)
The remuneration of the key management personnel of Bowen Coking Coal Ltd for the year ended 30 June
2020 was as follows:
Short Term Benefits
Post-Employment
Equity-settled Share-
based Payments
Total
Performance
related %
Key
Management
Personnel
N. Jorss
Salary &
Fees
$
48,000
G. Redelinghuys
241,258
M. Latimore (3)
N. Sneddon
B. Sergeant
S. Formica
J. Agenbag
D. Cornish
Total
1,187
60,000
180,822
39,420
36,000
125,000
731,687
(3) Appointed on 17 June 2020
Non-
cash
Benefits
$
-
-
-
-
-
-
-
-
-
Super-
annuation
Provision for
leave
entitlements
Shares
Options
/Rights
$
4,560
18,450
113
5,700
17,178
-
-
-
$
$
-
28,429
-
-
1,270
-
-
-
46,001
29,699
$
64,644
-
-
-
-
-
-
-
64,644
-
-
-
-
-
-
-
-
-
$
117,204
288,137
1,300
65,700
199,270
39,420
36,000
125,000
872,031
%
55.2%
0%
0%
0%
0%
0%
0%
0%
Page 22
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Directors’ Report
Remuneration Report (Audited) (Continued)
The percentage of equity-based remuneration for persons who were key management personnel of the Group
during the year ended 30 June 2021 is set out below:
Key Management Personnel
Proportion of Remuneration
Equity Based
Salary and Fees
N. Jorss
G. Redelinghuys
M. Latimore
N. Sneddon
B. Sergeant
S. Formica
J. Agenbag
D. Cornish
D. Edwards
0%
0%
45%
0%
0%
0%
0%
0%
41%
100%
100%
55%
100%
100%
100%
100%
100%
59%
Company Performance, Shareholder Wealth, and Director and Executive Remuneration
During the financial year, the Company generated losses as its principal activity was mineral exploration. As
the Company is still in the exploration and development stage, the link between remuneration, company
performance and shareholder wealth is tenuous. Share prices are subject to the influence of commodity prices
and market sentiment towards the sector, and as such, increases and decreases might occur independent of
executive performance and remuneration.
Options Held by Key Management Personnel
Details of options held directly, indirectly or beneficially by key management personnel during the year ended
30 June 2021 were as follows:
Key
Management
Personnel
Balance at
1 July
2020
Granted as
Compensa
tion
Acquired
Exercised
Sold
Balance at
30 June
2021
Total
Vested
30 June
2021
Total
Vested and
Exercisable
30 June
2021
N. Jorss
30,000,000
G.
Redelinghuys
14,000,000
-
-
-
-
(20,000,000)
(10,000,000)
(5,000,000)
(9,000,000)
-
-
-
-
-
-
M. Latimore
-
2,100,000
9,000,000
(9,000,000)
N. Sneddon
3,500,000
B. Sergeant
10,500,000
S. Formica (1)
2,100,000
J. Agenbag (1)
2,100,000
D. Cornish
3,500,000
D. Edwards
-
-
-
-
-
-
-
-
-
-
-
-
-
(3,500,000)
(10,500,000)
(2,100,000) (1)
(2,100,000) (1)
(3,500,000)
-
-
-
-
-
-
-
-
2,100,000
2,100,000
2,100,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Total
65,700,000
2,100,000
9,000,000
(55,700,000)
(19,000,000)
2,100,000
2,100,000
2,100,000
(1) Options held at date of resignation and exercised before year end.
Page 23
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Directors’ Report
Remuneration Report (Audited) (Continued)
Performance Rights Held by Key Management Personnel
Details of Performance Rights held directly, indirectly or beneficially by key management personnel during the
year ended 30 June 2021 were as follows:
Key
Management
Personnel
Balance at
1 July
2020
Granted as
Compensation
Vested
Lapsed
Balance at
30 June
2021
Total Vested
30 June 2021
D Edwards
-
12,000,000
-
- 12,000,000
-
Options Granted as Remuneration
The terms and conditions of each grant of options over ordinary shares affecting remuneration of directors and
other key management personnel in this financial year are as follows:
Key
Management
Personnel
Number of
options
granted
Grant date Vesting date Expiry date
Exercise
price
Fair Value
per option at
grant date
M. Latimore
2,100,000
11.11.2020
11.11.2020
31.12.2022
$0.07
$0.0146
Values of options over ordinary shares granted, exercised and lapsed for directors and other key management
personnel as part of compensation during the year ended 30 June 2021 are set out below:
Key Management Personnel
Value of options granted
during the year
Value of options
exercised during the
year
Value of options
lapsed during the year
N. Jorss
G. Redelinghuys
M. Latimore
N. Sneddon
B. Sergeant
D. Cornish
-
-
$30,763
-
-
-
$95,333
$42,550
-
$29,785
$89,355
$29,785
-
-
-
-
-
-
No options have been granted to Key Management Personnel since the end of the financial year.
Performance Rights Granted as Remuneration
The terms and conditions of each grant of performance right over ordinary shares affecting remuneration of
directors and other key management personnel in this financial year are as follows:
Key Management
Personnel
Number of
Performance
rights granted
Grant date
Expiry date
Exercise
price
Fair Value per
option
at
grant date
D. Edwards
D. Edwards
D. Edwards
4,000,000
4,000,000
4,000,000
01.02.2021
01.02.2021
01.02.2021
31.12.2022
31.12.2023
31.12.2024
$Nil
$Nil
$Nil
$0.05
$0.05
$0.05
Page 24
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Directors’ Report
Values of performance rights over ordinary shares granted, exercised and lapsed for directors and other key
management personnel as part of compensation during the year ended 30 June 2021 are set out below:
Key Management Personnel
Value of performance
rights granted during
the year
Value of performance
rights vested during
the year
of
Value
performance rights
lapsed during
the
year
D. Edwards
$114,671
-
-
No performance rights have been granted to Key Management Personnel since the end of the financial year.
Shares Held by Key Management Personnel
Details of shares held directly, indirectly or beneficially by key management personnel during the year ended
30 June 2021 were as follows:
Key Management
Personnel
Balance at
1 July 2020
Granted as
Compensation
Other Changes
Balance at
30 June 2021
N. Jorss
G. Redelinghuys (1)
M. Latimore
N. Sneddon
B. Sergeant
S. Formica (2)
J. Agenbag (1, 2)
D. Cornish
D. Edwards (3)
40,957,120
111,882,826
123,225,840
3,380,952
11,335,000
9,407,100
110,357,826
2,380,952
-
-
-
-
-
-
-
-
-
-
20,000,000
60,957,120
5,567,042
117,449,868
33,094,886
156,320,726
3,500,000
6,880,952
10,500,000
21,835,000
-
9,407,100
272,742
110,630,568
4,000,000
6,380,952
-
-
(1) 110,630,568 (110,357,826 at 1 July 2020) of these shares are held by both Gerhard Redelinghuys and James Agenbag through
their respective associations with Cape Coal Pty Ltd
(2) Held at date of resignation
(3) Held at date of appointment
Other transactions with Key Management Personnel
There have been no other transactions with key management personnel during the year ended 30 June 2021.
End of Remuneration Report (Audited)
Options and Performance Rights
At the date of this report, the unissued ordinary shares of the Company under options are as follows:
Unlisted Options
Issue Date
3 July 2020
31 August 2021
TOTAL
Page 25
Expiry Date
30 September 2023
31 August 2024
Exercise Price
$0.08
$0.10
No. Under Option
700,000
21,000,000
21,700,000
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Directors’ Report
At the date of this report, there are 20,000,000 unlisted performance rights on issue, with various vesting
conditions and expiry dates.
There have been no unissued shares or interests under option of any controlled entity within the Group during
or since reporting date. Option holders do not have any rights to participate in any share issue or other interests
in the Company or any other entity.
Directors’ Meetings
The meetings (held while a director) attended by each director during the financial year were:
Directors
Nicholas Jorss
Gerhard Redelinghuys
Matthew Latimore
Neville Sneddon
Blair Sergeant
Steven Formica
James Agenbag
Board
Remuneration
Meetings
Attended
Meetings
Attended
8
8
8
8
8
4
4
8
8
8
8
8
4
4
-
-
-
-
-
-
-
-
-
-
-
-
-
-
It is noted that the Directors were able to attend to business of the Company during the year by circulated
resolution and telephone meetings as permitted by the Company’s Constitution in place of conducting
meetings.
The Company does not have an audit committee. The Board is of the opinion that due to the nature and size
of the Company, the functions performed by an audit committee can be adequately handled by the full Board.
At such time when the Company is of sufficient size, a separate Audit and Risk Management Committee will
be formed.
Corporate Governance
In recognising the need for the highest standards of corporate behaviour and accountability, the directors of
Bowen Coking Coal Ltd support and, where practicable or appropriate, have adhered to the ASX Principles of
Corporate Governance. The Company’s Corporate Governance Statement is lodged separately on the ASX
and can be found on the Company’s website (www.bowencokingcoal.com.au).
Indemnifying Directors and Auditors
The Company has entered into a Deed with each of the Directors (and the Company Secretary) whereby the
Company has agreed to provide certain indemnities to each Director (and the Company Secretary) to the
extent permitted by the Corporations Act and to use its best endeavours to obtain and maintain directors’ and
officers’ indemnity insurance, subject to such insurance being available at reasonable commercial terms.
The Company has paid premiums to insure each of the directors (and the Company Secretary) of the Company
against liabilities for costs and expenses incurred by them in defending any legal proceedings arising out of
their conduct while acting in the capacity of director (or Company Secretary) of the Company, other than
conduct involving a wilful breach of duty in relation to the Company. The contracts include a prohibition on
disclosure of the premium paid and nature of the liabilities covered under the policy.
The Company has not given an indemnity or entered into an agreement to indemnify, or paid or agreed to pay
insurance premiums in respect of any person who is or has been an auditor of the Company or a related entity
during the year and up to the date of this report.
Page 26
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Directors’ Report
Proceedings on Behalf of the Company
No person has applied for leave of Court to bring proceedings on behalf of the Company or intervene in any
proceedings to which the Company is a party for the purpose of taking responsibility on behalf of the Company
for all or any part of those proceedings. The Company was not a party to any such proceedings during the
year.
Non-Audit Services
During the financial year, RSM Australia provided tax services to the value of $nil (2020: $6,500).
Auditor’s Independence Declaration
The lead auditor’s independence declaration under section 307C of the Corporations Act 2001 is attached to
and forms part of this financial report.
Signed in accordance with a resolution of the board of directors.
Gerhard Redelinghuys, Director
23 September 2021
Brisbane, Queensland
Page 27
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Auditor’s Independence Declaration
Page 28
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Shareholder Information
Additional information required by the Australian Securities Exchange Ltd and not shown elsewhere in this
report is as follows. The information is current as at 20 September 2021.
(a) Distribution of equity securities
The number of holders, by size of holding, in each class of security are:
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 and over
Total
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 and over
Total
Ordinary Shares
Unlisted Options ($0.08 @ 30-Sep-23)
No. Holders
No. Shares
No. Holders
No. Options
150
90
156
601
460
31,148
316,092
1,271,746
26,219,557
1,184,341,419
1,457
1,212,179,962
-
-
-
-
1
1
-
-
-
-
700,000
700,000
Unlisted Options ($0.10 @ 31-Aug-24)
Performance Rights
No. Holders
No. Options
No. Holders
No. Rights
-
-
-
-
1
1
-
-
-
-
21,000,000
21,000,000
-
-
-
-
2
2
-
-
-
-
20,000,000
20,000,000
There are 191 shareholders holding less than a marketable parcel of 3,225 shares.
Page 29
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Shareholder Information
(b) Twenty Largest Shareholders
The names of the twenty largest holders of Quoted Ordinary Shares are:
#
1
2
3
4
5
6
7
8
9
10
11
12
13
Registered Name
LATIMORE FAMILY PTY LTD *
CAPE COAL PTY LTD *
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED *
BNP PARIBAS NOMINEES PTY LTD SIX SIS LTD
CITICORP NOMINEES PTY LIMITED
OLD FORRESTER PTY LTD *
ST LUCIA RESOURCES CAPITAL FUND PTY LTD
CS THIRD NOMINEES PTY LIMITED
RIO SUPER PTY LTD
NORFOLK ENCHANTS PTY LTD
OLROSS INVESTMENTS PTY LIMITED
SAS INVESTMENTS PTY LTD
BRAZIL FARMING PTY LTD *
14 MAYFAIR VENTURES PTE LTD
15
BOND STREET CUSTODIANS LIMITED
16 M RESOURCES PTY LTD
17
STEVSAND INVESTMENTS PTY LTD
18 WISHART FAMILY SUPER PTY LTD
19 MR DEAN FIRMIN
20
FIRST ONE REALTY PTY LTD
TOP 20 TOTAL
Total of Securities
*Denotes merged holding
Number of Shares
% of total
Shares
154,325,194
12.7%
119,849,774
105,994,922
82,332,144
62,620,079
44,807,470
40,439,261
24,805,452
23,654,584
21,843,388
21,666,667
21,000,000
17,300,000
16,159,746
15,921,662
15,022,261
12,794,145
11,387,368
10,672,451
8,997,403
9.9%
8.7%
6.8%
5.2%
3.7%
3.3%
2.0%
2.0%
1.8%
1.8%
1.7%
1.4%
1.3%
1.3%
1.2%
1.1%
0.9%
0.9%
0.7%
831,593,971
68.6%
1,212,179,962
100.0%
Page 30
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Shareholder Information
(c) Substantial Shareholders
The Company has received substantial shareholder notices from the following entities:
Name of Shareholder
Ordinary Shares
% of total Shares
M Resources Pty Ltd and Matthew Latimore
Cape Coal Pty Ltd and Gerhard Redelinghuys
Ilwella Pty Ltd
Crocodile Capital (and associated entities)
Nicholas Jorss
171,622,455
127,237,358
104,477,612
82,188,223
66,036,882
14.16%
10.50%
8.62%
6.78%
5.45%
The Company notes that, as at the date of this report, the following shareholders own substantial shareholdings
(≥ 5.0%) in Bowen Coking Coal Ltd:
Name of Shareholder
Ordinary Shares
% of total Shares
M Resources Pty Ltd and Matthew Latimore
Cape Coal Pty Ltd and Gerhard Redelinghuys
HSBC Custody Nominees (Australia) Limited
BNP Paribas Nominees Pty Ltd Six Sis Ltd
Nicholas Jorss
(d) Voting rights
171,622,455
127,237,358
105,994,922
82,332,144
66,036,882
14.16%
10.50%
8.74%
6.79%
5.45%
All ordinary shares carry one vote per share without restriction.
Options and performance rights do not carry voting rights.
(e) Restricted securities
As at the date of this report, there are no ordinary shares subject to ASX escrow.
(f) On-market buy back
There is not a current on-market buy-back in place.
(g) Business objectives
The Group has used its cash and assets that are readily convertible to cash in a way consistent with its
business objectives.
Page 31
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Interests in Tenements
Bowen Coking Coal Ltd held the following interests in tenements as at the date of this report:
Country
Location
Project
Tenement
Status
Current
Interest (%)
Australia
Queensland
Cooroorah
MDL 453
Australia
Queensland
Mt Hillalong
EPC 1824
Australia
Queensland
Hillalong East
EPC 2141
Australia
Queensland
Carborough
EPC 1860
Australia
Queensland
Lilyvale
EPC 1687
Australia
Queensland
Lilyvale
EPC 2157
Australia
Queensland
Mackenzie
EPC 2081
Australia
Queensland
Comet Ridge
EPC 1230
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Australia
Queensland
Isaac River
MDL 444
Granted, under
renewal
Australia
Queensland
Isaac River
EPC 830
Granted
Australia
Queensland
Isaac River
ML 700062
Application
Australia
Queensland
Isaac River
ML 700063
Application
Australia
Queensland
Broadmeadow
East
ML 70257
Granted
100%
90%*
90%*
100%
15%
15%
5%
100%
100%
100%
100%
100%
100%
* Sumitomo Corporation elected to proceed with the Hillalong Joint Venture (“Hillalong JV”) following the
completion of the $2.5m Phase 1 exploration program at Hillalong, resulting in Sumitomo solidifying a 10%
interest in the Project. Completion of the first 10% transfer was completed on 13 April 2021. Sumitomo
Corporation is currently earning-in for a further 5% by spending $2.5m under Phase 2a of the Farm-In
Agreement. Post the completion of Phase 2a, Sumitomo has the option to obtain an additional 5% (for a total
interest of 20%) in the project by spending a further $2.5m on Phase 2b exploration.
Page 32
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Annual Mineral Resources Statement
Resources Statement on 30 June 2021 (JORC 2012, Mt) * Includes 28Mt attributable to Stanmore Coal Ltd
as part of the Lilyvale Joint Venture and 4Mt attributable to Sumitomo as part of the Hillalong Joint Venture
Resources Statement as at 30 June 2021 (JORC 2012, Mt)
Project
Tenement
Measured
Resource
Indicated
Resource
Inferred
Resource
Total
% Holding
Broadmeadow
East
ML70257
6
Cooroorah
MDL 453
Lilyvale
EPC 1687
&2157
Comet Ridge
EPC 1230
MDL 444 /
MLA700062
& EPC830
EPC2141
&1824
Isaac River
Hillalong
TOTAL
8
6
20
4
96
9
3
21
135
23
81
33
43
0
22
33
177
33
60
9
43
100%
100%
15%
100%
100%
90%**
202*
355*
* Includes 28Mt attributable to Stanmore Coal Ltd as part of the Lilyvale Joint Venture
**Includes 4Mt attributable to Sumitomo Corporation following the completion of the Phase 1 farm in. See
ASX release 4 May 2020, 9 June 2020 and 11 December 2020.
Resources Statement as at 30 June 2020 (JORC 2012, Mt)
Measured
Resource
Indicated
Resource
Inferred
Resource
Project
Tenement
Cooroorah MDL 453
EPC 1687
&2157
EPC 1230
MDL 444 /
MLA700062
& EPC830
EPC2141
&1824
Lilyvale
Comet
Ridge
Isaac River
Hillalong
TOTAL
96
9
3
21
129
8
6
14
Total
% Holding
177
100%
33
60
9
15%
100%
100%
43
100%**
81
33
43
0
22
179*
322*
* Includes 28Mt attributable to Stanmore Coal Ltd as part of the Lilyvale Joint Venture
**Includes 4Mt attributable to Sumitomo Corporation following the completion of the Phase 1 farm in. See
ASX release 4 May 2020 and 9 June 2020.
Movements:
On 30 September 2020 the Company announced the completion of the Broadmeadow East acquisition. See
ASX release 30 September 2020 “Broadmeadow East Coking Coal Project Acquisition Completed”
Page 33
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Annual Mineral Resources Statement
The Group regularly reviews its Mineral Resources and Reserves to assess their reasonableness, engaging
suitably qualified competent persons where required. A summary of the governance and controls applicable
to the Group’s Mineral Resources and Reserves processes is as follows:
▪ Review and validation of drilling and sampling methodology and data spacing, geological logging, data
collection and storage, sampling and analytical quality control;
▪ Geological interpretation — review of known and interpreted structure, lithology and weathering
controls;
▪ Estimation methodology — relevant to mineralisation style and proposed mining methodology;
▪ Comparison of estimation results with previous mineral resource models, and with results using
alternate modelling methodologies;
▪ Visual validation of block model against raw composite data; and
▪ Peer review by independent consultants as required.
This Annual Mineral Resources and Ore Reserves Statement:
▪
is based on, and fairly represents, information and supporting documentation prepared by competent
persons (referred to on page 2); and
▪ has been approved by Mr Troy Turner who is a Member of the Australasian Institute of Mining and
Metallurgy. Mr Turner, Managing Director and a fulltime employee of Xenith Consulting Pty Ltd, has
sufficient experience that is relevant to the styles of mineralisation under consideration and to the
activity which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the
“Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Mr
Turner has approved this Annual Mineral Resources and Ore Reserves Statement as a whole in the
form and context in which it appears in this Annual Report.
Page 34
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Consolidated Statement of Profit or Loss and Other Comprehensive Income
For the Year Ended 30 June 2021
Revenue
Corporate and administrative expenses
Employee benefits expense
Depreciation and amortisation expense
Exploration expense
Finance Cost
Share of loss of joint ventures accounted for using equity
method
Share-based payments
Loss before income tax expense
Income tax expense
Loss for the year
Other comprehensive income
Note
2021
$
2020
$
2
3
3
24
4
531
120,840
(1,699,722)
(896,093)
(25,713)
(25,784)
(5,682)
(65,001)
(506,904)
(3,224,368)
-
(989,446)
(807,795)
-
(182,535)
-
-
(198,876)
(2,057,812)
-
(3,224,368)
(2,057,812)
Other comprehensive income for the year, net of tax
-
-
Total comprehensive loss for the year
(3,224,368)
(2,057,812)
Total comprehensive loss for the year attributable to the
owners of the Company
(3,224,368)
(2,057,812)
Loss per share attributable to owners of the parent company
Basic earnings per share
Diluted earnings per share
20
20
Cents
(0.35)
(0.35)
Cents
(0.26)
(0.24)
The accompanying notes form part of these financial statements.
Page 35
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Consolidated Statement of Financial Position
As at 30 June 2021
Note
30 June 2021
30 June 2020
$
$
CURRENT ASSETS
Cash and cash equivalents
Trade and other receivables
Prepayments
Total Current Assets
NON-CURRENT ASSETS
Receivables
Exploration and evaluation assets
Property, plant & equipment
Right of use asset
Other
Total Non-Current Assets
TOTAL ASSETS
CURRENT LIABILITIES
Trade and other payables
Lease Liability
Other
Total Current Liabilities
NON-CURRENT LIABILITIES
Investments accounted for using the equity method
Lease Liability
Provisions
Total Non-Current LIABILITES
TOTAL LIABILITIES
NET ASSETS
EQUITY
Issued capital
Reserves
Accumulated losses
TOTAL EQUITY
The accompanying notes form part of these financial statements.
Page 36
5
6
7
6
8
9
10
7
11
12
13
14
12
15
16
17
2,997,030
2,394,319
150,126
23,142
164,260
19,849
3,170,298
2,578,428
133,000
-
12,648,191
9,117,268
8,758
125,930
206,824
-
-
-
13,122,703
9,117,268
16,293,001
11,695,696
948,191
46,738
-
994,929
65,000
82,797
201,324
349,121
730,047
-
485,000
1,215,047
-
-
-
-
1,344,050
1,215,047
14,948,951
10,480,649
63,917,409
56,399,643
755,943
581,039
(49,724,401)
(46,500,033)
14,948,951
10,480,649
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Consolidated Statement of Changes in Equity
For the Year Ended 30 June 2021
Note
Issued Capital
Reserves
Accumulated
Losses
Total Equity
$
$
$
$
Balance at 30 June 2019
53,398,058
471,863
(44,442,221)
9,427,700
Loss for the year
Total comprehensive loss
Issue of shares
Exercise of options
Conversion of performance shares
Share-based payments
Share issue costs
Balance at 30 June 2020
Loss for the year
Total comprehensive loss
Issue of shares
Exercise of options
Conversion of performance shares
Share-based payments
Share issue costs
Balance at 30 June 2021
-
-
500,000
2,489,760
89,700
-
(77,875)
-
-
-
-
(89,700)
198,876
-
(2,057,812)
(2,057,812)
(2,057,812)
(2,057,812)
-
-
-
-
-
500,000
2,489,760
-
198,876
(77,875)
56,399,643
581,039
(46,500,033)
10,480,649
-
-
5,250,000
2,106,660
-
-
-
-
332,000
(332,000)
-
506,904
(170,894)
-
(3,224,368)
(3,224,368)
(3,224,368)
(3,224,368)
-
-
-
-
-
5,250,000
2,106,660
-
506,904
(170,894)
63,917,409
755,943
(49,724,401)
14,948,951
16
16
16
24
16
16
16
24
The accompanying notes form part of these financial statements.
Page 37
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Consolidated Statement of Cash Flows
For the Year Ended 30 June 2021
CASH FLOWS FROM OPERATING ACTIVITIES
Interest receipts
Other receipts/payments
Payments to suppliers and employees
Net cash used in operating activities
CASH FLOWS FROM INVESTING ACTIVITIES
Payments for exploration and evaluation assets
Payments for property, plant and equipment
Payments for bonds
Payments for loans to joint venture
Payments for exploration costs recoverable from farmee
Receipts for exploration costs from farmee
Net cash used in investing activities
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issue of shares and options
Payments for capital raising costs
Payments for leases
Receipts from share placement applications
Net cash provided by financing activities
2021
$
2020
$
531
-
20,840
41,199
(2,711,343)
(1,694,909)
19
(2,710,812)
(1,632,870)
(3,077,371)
(1,470,881)
(9,533)
(206,824)
(66,500)
-
-
-
(1,463,210)
(2,500,000)
1,463,210
2,500,000
(3,360,228)
(1,470,881)
6,871,659
(170,894)
(27,014)
2,989,760
(20,000)
-
485,000
6,673,751
3,454,760
Net increase in cash held
602,711
351,009
Cash at beginning of the year
2,394,319
2,043,310
Cash at end of the year
5
2,997,030
2,394,319
The accompanying notes form part of these financial statements.
Page 38
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Notes to the Consolidated Financial Statements
For the Year Ended 30 June 2021
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The financial statements are general purpose financial statements that have been prepared in accordance
with the Corporations Act 2001, Australian Accounting Standards, and other authoritative pronouncements of
the Australian Accounting Standards Board. Bowen Coking Coal Ltd is a for-profit entity for the purpose of
preparing the financial statements. The financial statements are presented in Australian dollars.
Compliance with Australian Accounting Standards ensures that the financial statements and notes also comply
with International Financial Reporting Standards.
The financial statements are for the consolidated entity consisting of Bowen Coking Coal Ltd and its Controlled
Entities (the Group). Bowen Coking Coal Ltd is a listed public company, incorporated and domiciled in
Australia. The financial report was authorised for issue on 23 September 2021 by the directors of the Company.
Separate financial statements for Bowen Coking Coal Ltd as an individual entity are no longer presented
following a change to the Corporations Act 2001. However, financial information required for Bowen Coking
Coal Ltd as an individual entity is included in Note 30.
Material accounting policies adopted in the preparation of these financial statements are presented below.
They have been consistently applied unless otherwise stated.
Basis of Preparation
These general purpose financial statements have been prepared in accordance with Australian Accounting
Standards and Interpretations issued by the Australian Accounting Standards Board (‘AASB’) and the
Corporations Act 2001, as appropriate for for-profit orientated entities. These financial statements and notes
also comply with the International Financial Reporting Standards and Interpretations as issued by the
International Accounting Standards Board (‘IASB’).
Historical Cost Convention
The financial statements have been prepared under the historical cost convention, except for, where
applicable, the revaluation of financial assets and liabilities at fair value through profit or loss.
Going Concern
The financial statements have been prepared on a going concern basis which contemplates the continuity of
normal business activities and the realisation of assets and discharge of liabilities in the ordinary course of
business.
For the year ended 30 June 2021 the Group generated a consolidated loss of $3,224,368 and incurred
operating cash outflows of $2,710,812. As at 30 June 2021 the Group has cash and cash equivalents of
$2,997,030 and net assets of $14,948,951.
The Group’s ability to continue to adopt the going concern assumption will depend upon the Group being able
to manage its liquidity requirement and by taking some or all of the following actions:
1.
raising additional capital;
2. successful exploration and subsequent exploitation of the Group’s tenements; and
3.
reducing its working capital expenditure.
Page 39
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2021
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Going Concern (Continued)
After taking into account the $15.4m capital raising since year end, and the Group’s ability to reduce its working
capital requirement if needed, the directors have a reasonable expectation that the Group will have adequate
resources to fund its future operational requirements and for these reasons they continue to adopt the going
concern basis in preparing the financial report.
Principles of Consolidation
Subsidiaries
The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Bowen Coking
Coal Ltd ("Company" or "parent entity") as at 30 June 2021, and the results of all subsidiaries for the year then
ended. Bowen Coking Coal Ltd and its subsidiaries together are referred to in these financial statements as
the Group.
The names of the subsidiaries are contained in Note 27. All subsidiaries in Australia have a 30 June financial
year end and are accounted for by the parent entity at cost.
Subsidiaries are all entities over which the Group has control. The Group has control over an entity when the
Group is exposed to, or has a right to, variable returns from its involvement with the entity, and has the ability
to use its power to affect those returns. Subsidiaries are fully consolidated from the date on which control is
transferred to the Group. They are de-consolidated from the date that control ceases.
Intercompany transactions, balances 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 controlled entities have been changed where necessary to
ensure consistency with the policies adopted by the Group.
Changes in ownership interests
When the Group ceases to have control, joint control or significant influence, any retained interest in the entity
is remeasured to its fair value, with the change in the 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, joint venture 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.
Segment Reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief
operating decision maker. The chief operating decision maker, who is responsible for allocating resources and
assessing performance of the operating segments, has been identified as the Managing Director.
The Group has identified its operating segments based on the internal reports that are reviewed and used by
the Board of Directors (chief operating decision makers) in assessing performance and determining the
allocation of resources.
The Group is managed primarily on the basis of geographical locations as these locations have notably
different risk profiles and performance assessment criteria. Operating segments are therefore determined on
the same basis. Reportable segments disclosed are based on aggregating operating segments where the
segments are considered to have similar economic characteristics and are similar with respect to any external
regulatory requirements. Management currently identifies the Group as having only one reportable segment,
being the exploration of mineral projects in Australia.
Page 40
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2021
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Income Tax
The income tax expense/income for the period comprises current income tax expense/income and deferred
tax expense/income. Current income tax expense charged to 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 profit or loss when the tax relates to items
that are credited or charged directly to equity.
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 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.
The Company and its Australian 100% owned controlled entities have formed a tax consolidated group.
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. The amount of benefits brought to account or which may be realised in the future is based on
the assumption that no adverse change will occur in income taxation legislation and the anticipation that the
Group will derive sufficient future assessable income to enable the benefit to be realised and comply with the
conditions of deductibility imposed by the law.
Exploration and Evaluation Assets
Exploration and evaluation expenditure incurred is accumulated in respect of each identifiable area of interest.
Such expenditures comprise net direct costs and an appropriate portion of related overhead expenditure but
do not include overheads or administration expenditure not having a specific nexus with a particular area of
interest. These costs are only carried forward to the extent that they are expected to be recouped through the
successful development of the area or where activities in the area have not yet reached a stage which permits
reasonable assessment of the existence of economically recoverable reserves and active or significant
operations in relation to the area are continuing.
A regular review will be undertaken on each area of interest to determine the appropriateness of continuing to
carry forward costs in relation to that area of interest. A provision is raised against exploration and evaluation
assets where the directors are of the opinion that the carried forward net cost may not be recoverable or the
right of tenure in the area lapses. The increase in the provision is charged against the results for the year.
Accumulated costs in relation to an abandoned area are written off in full against profit or loss in the year in
which the decision to abandon the area is made.
When production commences, the accumulated costs for the relevant area of interest are amortised over the
life of the area according to the rate of depletion of the economically recoverable reserves.
Page 41
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2021
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Restoration Costs
Costs of site restoration are provided over the life of the facility from when exploration commences and are
included in the costs of that stage. Site restoration costs include the dismantling and removal of mining plant,
equipment and building structures, waste removal, and rehabilitation of the site in accordance with clauses of
the exploration and mining permits. Such costs have been determined using estimates of future costs, current
legal requirements and technology on an undiscounted basis.
Any changes in the estimates for the costs are accounted for on a prospective basis. In determining the costs
of site restoration, there is uncertainty regarding the nature and extent of the restoration due to community
expectations and future legislation. Accordingly, the costs have been determined on the basis that the
restoration will be completed within one year of abandoning the site.
The Group is not currently liable for any future restoration costs in relation to current areas of interest.
Consequently, no provision for restoration has been deemed necessary.
Impairment of Assets
At each reporting date, the Group reviews the carrying values of its tangible and intangible assets to determine
whether there is any indication that those assets have been impaired. If such an indication exists, the
recoverable amount of the asset, being the higher of the asset’s fair value less costs to sell and value in use,
is compared to the asset's carrying value. Any excess of the asset's carrying value over its recoverable amount
is expensed to profit or loss.
Financial Instruments
Recognition and Initial Measurement
Financial instruments, incorporating financial assets and financial liabilities, are recognised when the entity
becomes a party to the contractual provisions of the instrument. Trade date accounting is adopted for financial
assets. Financial instruments are initially measured at fair value plus transactions costs where the instrument
is not classified as at fair value through profit or loss. Transaction costs related to instruments classified as at
fair value through profit or loss are expensed to profit or loss immediately.
Derecognition
Financial assets are derecognised where the contractual rights to receipt of cash flows expire or the asset is
transferred to another party whereby the entity no longer has any significant continuing involvement in the risks
and benefits associated with the asset.
Financial liabilities are derecognised where the related obligations are either discharged, cancelled or expire.
The difference between the carrying value of the financial liability extinguished or transferred to another party
and the fair value of consideration paid, including the transfer of non-cash assets or liabilities assumed, is
recognised in profit or loss.
Classification and Subsequent Measurement
Financial instruments are subsequently measured at fair value or amortised cost using the effective interest
rate method. Fair value is the price that would be received to sell an asset or paid to transfer an asset.
Amortised cost is calculated as:
(a) the amount at which the financial asset or financial liability is measured at initial recognition;
(b) less principal repayments;
(c) plus or minus the cumulative amortisation of the difference, if any, between the amount initially
recognised and the maturity amount calculated using the effective interest method; and
(d) less any reduction for impairment.
Page 42
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2021
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Financial Instruments (Continued)
The effective interest method is used to allocate interest income or interest expense over the relevant period
and is equivalent to the rate that exactly discounts estimated future cash payments or receipts (including fees,
transaction costs and other premiums or discounts) through the expected life (or when this cannot be reliably
predicted, the contractual term) of the financial instrument to the net carrying amount of the financial asset or
financial liability. Revisions to expected future net cash flows will necessitate an adjustment to the carrying
value with a consequential recognition of an income or expense in profit or loss.
The Group does not designate any interests in subsidiaries, associates or joint venture entities as being subject
to the requirements of accounting standards specifically applicable to financial instruments.
Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not
quoted in an active market and are subsequently measured at amortised cost.
Financial liabilities
Non-derivative financial liabilities (excluding financial guarantees) are subsequently measured at amortised
cost.
Impairment
The Group recognises a loss allowance for expected credit losses on financial assets which are either
measured at amortised cost or fair value through other comprehensive income. The measurement of the loss
allowance depends upon the Group's assessment at the end of each reporting period as to whether the
financial instrument's credit risk has increased significantly since initial recognition, based on reasonable and
supportable information that is available, without undue cost or effort to obtain.
Where there has not been a significant increase in exposure to credit risk since initial recognition, a 12-month
expected credit loss allowance is estimated. This represents a portion of the asset's lifetime expected credit
losses that is attributable to a default event that is possible within the next 12 months. Where a financial asset
has become credit impaired or where it is determined that credit risk has increased significantly, the loss
allowance is based on the asset's lifetime expected credit losses. The amount of expected credit loss
recognised is measured on the basis of the probability weighted present value of anticipated cash shortfalls
over the life of the instrument discounted at the original effective interest rate.
For financial assets mandatorily measured at fair value through other comprehensive income, the loss
allowance is recognised in other comprehensive income with a corresponding expense through profit or loss.
In all other cases, the loss allowance reduces the asset's carrying value with a corresponding expense through
profit or loss.
Cash and Cash Equivalents
Cash and cash equivalents include cash on hand, deposits held at call with banks and other short-term highly
liquid investments with original maturities of less than 3 months.
Issued Capital
Ordinary shares are classified as equity. Transaction costs (net of tax where the deduction can be utilised)
arising on the issue of ordinary shares are recognised in equity as a reduction of the share proceeds received.
Page 43
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2021
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Share-Based Payments
The Group makes equity-settled share-based payments to directors, employees and other parties for services
provided or the acquisition of exploration assets. Where applicable, the fair value of the equity is measured at
grant date and recognised as an expense over the vesting period, with a corresponding increase to an equity
account. The fair value of shares is ascertained as the market bid price. The fair value of options is ascertained
using the Black and Scholes option valuation pricing model which incorporates all market vesting conditions.
Where applicable, the number of shares and options expected to vest is reviewed and adjusted at each
reporting date such that the amount recognised for services received as consideration for the equity
instruments granted shall be based on the number of equity instruments that eventually vest.
Where the fair value of services rendered by other parties can be reliably determined, this is used to measure
the equity-settled payment.
If equity-settled awards are modified, as a minimum an expense is recognised as if the modification has not
been made. An additional expense is recognised, over the remaining vesting period, for any modification that
increases the total fair value of the share-based compensation benefit as at the date of modification.
If the non-vesting condition is within the control of the Group or employee, the failure to satisfy the condition is
treated as a cancellation. If the condition is not within the control of the Group or employee and is not satisfied
during the vesting period, any remaining expense for the award is recognised over the remaining vesting
period, unless the award is forfeited.
If equity-settled awards are cancelled, it is treated as if it has vested on the date of cancellation, and any
remaining expense is recognised immediately. If a new replacement award is substituted for the cancelled
award, the cancelled and new award is treated as if they were a modification.
Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST (or overseas VAT), except where
the amount of GST incurred is not recoverable. In these circumstances the GST (or overseas VAT) is
recognised as part of the cost of acquisition of the asset or as part of an item of the expense. Receivables and
payables in the statement of financial position are shown inclusive of GST. Cash flows are presented in the
statement of cash flows on a gross basis except for the GST component of investing and financing activities
which are disclosed as operating cash flows.
Right-of-use assets
A right-of-use asset is recognised at the commencement date of a lease. The right-of-use asset is measured
at cost, which comprises the initial amount of the lease liability, adjusted for, as applicable, any lease payments
made at or before the commencement date net of any lease incentives received, any initial direct costs
incurred, and, except where included in the cost of inventories, an estimate of costs expected to be incurred
for dismantling and removing the underlying asset, and restoring the site or asset.
Right-of-use assets are depreciated on a straight-line basis over the unexpired period of the lease or the
estimated useful life of the asset, whichever is the shorter. Where the consolidated entity expects to obtain
ownership of the leased asset at the end of the lease term, the depreciation is over its estimated useful life.
Right-of use assets are subject to impairment or adjusted for any remeasurement of lease liabilities.
The Group has elected not to recognise a right-of-use asset and corresponding lease liability for short-term
leases with terms of 12 months or less and leases of low-value assets. Lease payments on these assets are
expensed to profit or loss as incurred.
Page 44
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2021
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Lease liabilities
A lease liability is recognised at the commencement date of a lease. The lease liability is initially recognised
at the present value of the lease payments to be made over the term of the lease, discounted using the interest
rate implicit in the lease or, if that rate cannot be readily determined, the consolidated entity's incremental
borrowing rate. Lease payments comprise of fixed payments less any lease incentives receivable, variable
lease payments that depend on an index or a rate, amounts expected to be paid under residual value
guarantees, exercise price of a purchase option when the exercise of the option is reasonably certain to occur,
and any anticipated termination penalties. The variable lease payments that do not depend on an index or a
rate are expensed in the period in which they are incurred.
Lease liabilities are measured at amortised cost using the effective interest method. The carrying amounts are
remeasured if there is a change in the following: future lease payments arising from a change in an index or a
rate used; residual guarantee; lease term; certainty of a purchase option and termination penalties. When a
lease liability is remeasured, an adjustment is made to the corresponding right-of use asset, or to profit or loss
if the carrying amount of the right-of-use asset is fully written down.
Finance costs
Finance costs attributable to qualifying assets are capitalised as part of the asset. All other finance costs are
expensed in the period in which they are incurred.
Joint ventures
A joint venture is a joint arrangement whereby the parties that have joint control of the arrangement have rights
to the net assets of the arrangement. Investments in joint ventures are accounted for using the equity method.
Under the equity method, the share of the profits or losses of the joint venture is recognised in profit or loss
and the share of the movements in equity is recognised in other comprehensive income. Investments in joint
ventures are carried in the statement of financial position at cost plus post-acquisition changes in the
consolidated entity's share of net assets of the joint venture.
Goodwill relating to the joint venture is included in the carrying amount of the investment and is neither
amortised nor individually tested for impairment. Income earned from joint venture entities reduce the carrying
amount of the investment.
Foreign Currency Transactions and Balances
Functional and presentation currency
The functional and presentation currency of Bowen Coking Coal Ltd and its Australian subsidiaries is Australian
dollars ($A).
Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing
at the date of the transaction. Foreign currency monetary items are translated at the year-end exchange rate.
Non-monetary items measured at historical cost continue to be carried at the exchange rate at the date of the
transaction. Non-monetary items measured at fair value are reported at the exchange rate at the date when
fair values were measured. Exchange differences arising on the translation of monetary items are recognised
in profit or loss.
Group Companies
The financial results and position of foreign operations whose functional currency is not Australian dollars are
translated as follows:
▪ assets and liabilities are translated at period-end exchange rates prevailing at that reporting date;
▪
▪
income and expenses are translated at average exchange rates for the period;
retained earnings are translated at the exchange rates prevailing at the date of the transaction.
Exchange differences arising on translation of foreign operations are recognised in other comprehensive
income.
Page 45
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2021
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Employee Benefits
Short-term employee benefit obligations
Liabilities for wages and salaries, including non-monetary benefits, annual leave and accumulating sick leave
expected to be settled wholly within 12 months after the end of the reporting period are recognised in liabilities
in respect of employees' services rendered up to the end of the reporting period and are measured at amounts
expected to be paid when the liabilities are settled.
Other long-term employee benefits
The liability for annual leave and long service leave not expected to be settled within 12 months of the reporting
date are measured at the present value of expected future payments to be made in respect of services provided
by employees up to the reporting date using the projected unit credit method. Consideration is given to
expected future wage and salary levels, experience of employee departures and periods of service. Expected
future payments are discounted using market yields at the reporting date on corporate bonds with terms to
maturity and currency that match, as closely as possible, the estimated future cash outflows.
Defined contribution superannuation expense
Contributions to defined contribution superannuation plans are expensed in the period in which they are
incurred.
Current and non-current classification
Assets and liabilities are presented in the statement of financial position based on current and non-current
classification.
An asset is classified as current when: it is either expected to be realised or intended to be sold or consumed
in the Group's normal operating cycle; it is held primarily for the purpose of trading; it is expected to be realised
within 12 months after the reporting period; or the asset is cash or cash equivalent unless restricted from being
exchanged or used to settle a liability for at least 12 months after the reporting period. All other assets are
classified as non-current.
A liability is classified as current when: it is either expected to be settled in the Group's normal operating cycle;
it is held primarily for the purpose of trading; it is due to be settled within 12 months after the reporting period;
or there is no unconditional right to defer the settlement of the liability for at least 12 months after the reporting
period. All other liabilities are classified as non-current.
Deferred tax assets and liabilities are always classified as non-current.
Earnings Per Share (EPS)
Basic earnings per share is calculated by dividing the loss attributable to equity holders 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 any bonus elements in ordinary shares issued during
the year.
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 46
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2021
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Provisions
Provisions are recognised when the consolidated entity has a present (legal or constructive) obligation as a
result of a past event, it is probable the consolidated entity will be required to settle the obligation, and a reliable
estimate can be made of the amount of the obligation. The amount recognised as a provision is the best
estimate of the consideration required to settle the present obligation at the reporting date, taking into account
the risks and uncertainties surrounding the obligation.
If the time value of money is material, provisions are discounted using a current pre-tax rate specific to the
liability. The increase in the provision resulting from the passage of time is recognised as a finance cost.
Property, plant and equipment
Plant and equipment is stated at historical cost less accumulated depreciation and impairment. Historical cost
includes expenditure that is directly attributable to the acquisition of the items.
Depreciation is calculated on a straight-line basis to write off the net cost of each item of property, plant and
equipment (excluding land) over their expected useful lives as follows:
Plant and equipment 5 years
The residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each
reporting date.
An item of property, plant and equipment is derecognised upon disposal or when there is no future economic
benefit to the consolidated entity. Gains and losses between the carrying amount and the disposal proceeds
are taken to profit or loss.
New or amended Accounting Standards and Interpretations adopted
The consolidated entity has adopted all of the new or amended Accounting Standards and Interpretations
issued by the Australian Accounting Standards Board ('AASB') that are mandatory for the current reporting
period.
Any new or amended Accounting Standards or Interpretations that are not yet mandatory have not been early
adopted.
New and Amended Standards and Interpretations for Future Periods
Australian Accounting Standards and Interpretations that have recently been issued or amended but are not
yet mandatory, have not been early adopted by the consolidated entity for the annual reporting period ended
30 June 2021.
The consolidated entity has not yet assessed the impact of these new or amended Accounting Standards and
Interpretations.
Critical Accounting Estimates and Judgements
The directors evaluate estimates and judgements incorporated into the financial statements based on historical
knowledge and best available current information. Estimates assume a reasonable expectation of future events
and are based on current trends and economic data, obtained both externally and within the Group.
Key Judgements:
Exploration and Evaluation Assets
The Group performs regular reviews on each area of interest to determine the appropriateness of continuing
to carry forward costs in relation to that area of interest. These reviews are based on detailed surveys and
analysis of exploration and drilling results performed to reporting date. Exploration and evaluation assets as
at 30 June 2021 were $12,648,191.
Page 47
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2021
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Critical Accounting Estimates and Judgements (continued)
Share-based payment transactions
The consolidated entity measures the cost of equity-settled transactions with employees by reference to the
fair value of the equity instruments at the date at which they are granted. The fair value is determined by using
either the Binomial or Black-Scholes model taking into account the terms and conditions upon which the
instruments were granted. The accounting estimates and assumptions relating to equity-settled share-based
payments would have no impact on the carrying amounts of assets and liabilities within the next annual
reporting period but may impact profit or loss and equity.
Refer Note 24 for further information.
Recovery of deferred tax assets
Deferred tax assets are recognised for deductible temporary differences only if the consolidated entity
considers it is probable that future taxable amounts will be available to utilise those temporary differences and
losses.
Rehabilitation provision
A provision has been made for the present value of anticipated costs for future rehabilitation of land explored
or mined. The consolidated entity's mining and exploration activities are subject to various laws and regulations
governing the protection of the environment. The consolidated entity recognises management's best estimate
for assets retirement obligations and site rehabilitations in the period in which they are incurred. Actual costs
incurred in the future periods could differ materially from the estimates. Additionally, future changes to
environmental laws and regulations, life of mine estimates and discount rates could affect the carrying amount
of this provision.
NOTE 2: REVENUE
Revenue from operating activities:
Interest received from other persons
Cash flow boost
NOTE 3: EXPENSES
Included in expenses are the following items:
Accounting and audit fees
ASX, ASIC, share registry expenses
Consulting fees
Insurance
Legal fees
Marketing
Occupancy costs
Travel expenses
Superannuation expense
Provision for leave entitlements
Page 48
2021
$
531
-
531
2021
$
78,283
101,248
1,008,632
75,102
289,917
27,796
60,440
19,020
55,311
11,531
2020
$
20,840
100,000
120,840
2020
$
68,020
124,183
200,817
57,329
367,035
17,671
28,694
68,866
46,001
-
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2021
NOTE 4: INCOME TAX EXPENSE
Recognised in the Statement of profit or loss
a) Tax expense
Current tax expense
Deferred tax expense
Total income tax expense per the Statement of profit or loss
2021
2020
$
-
-
-
$
-
-
-
b) Numerical reconciliation between tax expense and pre-tax net profit or (loss)
Net loss before tax
(3,224,368)
(2,057,812)
Corporate tax rate applicable
30%
30%
Income tax benefit on above at applicable corporate rate
(967,310)
(617,344)
Increase in income tax due to tax effect of:
Share-based payments expense
Non-deductible expenses
Current year tax losses not recognised
Movement in unrecognised temporary differences
Decrease in income tax expense due to:
Non-assessable income
Deductible equity raising costs
Income tax expense attributable to entity
Deferred tax assets and liabilities
152,071
83,975
756,415
37,942
-
(63,093)
-
59,663
718
648,197
-
(29,976)
(61,258)
-
(c) Recognised deferred tax assets and liabilities
30%
30%
Deferred tax assets
Employee provisions
Other provisions and accruals
Plant & Equipment
Blackhole – previously expensed
Tax losses
15,121
12,435
(2,627)
157,498
1,946,402
2,128,829
11,662
11,613
-
62,616
1,281,449
1,367,340
Set-off of deferred tax liabilities
Net deferred tax assets
(2,128,829)
(1,367,340)
-
-
Page 49
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2021
NOTE 4: INCOME TAX EXPENSE (Continued)
(c) Recognised deferred tax assets and liabilities (Continued)
Deferred tax liabilities
Prepayments
Exploration and mine properties
Gross deferred tax liabilities
Set-off of deferred tax assets
Net deferred tax liabilities
2021
$
2020
$
(6,943)
(2,121,886)
(2,128,829)
(97)
(1,367,243)
(1,367,340)
2,128,829
1,367,340
-
-
(d) Unused tax losses and temporary differences for which no deferred tax assets has been recognised
Deferred tax assets have not been recognised in respect of the following
using corporate tax rates of:
30%
30%
Deductible temporary differences
Tax revenue losses
Tax capital losses
Total unrecognised deferred tax assets
148,208
5,280,653
1,104,890
6,533,751
122,092
4,548,210
1,104,890
5,775,192
The corporate tax rates on both recognised and unrecognised deferred tax assets and deferred tax liabilities have been
calculated with respect to the tax rate that is expected to apply in the year the deferred tax asset is realised or the liability
is settled.
NOTE 5: CASH AND CASH EQUIVALENTS
Cash at bank and on hand
Short term deposits
NOTE 6: RECEIVABLES
Current:
Other receivables
Non-Current:
Receivable from joint venture entities
Page 50
2021
$
2,895,033
101,997
2,997,030
2021
$
150,126
150,126
133,000
133,000
2020
$
1,527,604
866,715
2,394,319
2020
$
164,260
164,260
-
-
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2021
NOTE 7: OTHER ASSETS
Current:
Prepayments
Non-Current:
Rental bonds
Security deposit
NOTE 8: EXPLORATION AND EVALUATION ASSETS
Exploration and evaluation expenditure carried forward in respect of areas
of interest are:
Acquisitions - at cost
Exploration and evaluation phase - at cost
Movement in exploration and evaluation assets:
Acquisitions:
Opening balance - at cost
Acquisition costs during the period
Total acquisitions costs
Exploration and evaluation phase – at cost:
Opening balance - at cost
Capitalised exploration expenditure
Total exploration and evaluation phase – at cost:
2021
$
23,142
23,142
5,500
201,324
206,824
2020
$
19,849
19,849
-
-
-
2021
$
2020
$
5,521,320
7,126,871
12,648,191
4,319,997
1,201,323
5,521,320
4,797,271
2,329,600
7,126,871
4,319,997
4,797,271
9,117,268
4,219,997
100,000
4,319,997
3,305,013
1,492,258
4,797,271
Carrying amount at the end of the year
12,648,191
9,117,268
NOTE 9: PROPERTY PLANT AND EQUIPMENT
Office Equipment – at cost
Less: Accumulated depreciation
NOTE 10: RIGHT OF USE ASSET
Land and buildings – right of use
Less: Accumulated depreciation
2021
$
9,533
(775)
8,758
2021
$
150,867
(24,937)
125,930
2020
$
-
-
-
2020
$
-
-
-
The Group has recognised a right of use asset in relation to premises the entity leases for its corporate office under a three
year agreement commencing on 1 January 2021.
Page 51
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2021
NOTE 11: TRADE AND OTHER PAYABLES
Current:
Trade payables and accrued expenses
Farm-in funds received in advance
Short term employee benefits
Total payables (unsecured)
2021
$
622,959
274,828
50,404
948,191
2020
$
691,174
-
38,873
730,047
The average credit period on purchases of goods and services is 30 days. No interest is paid on trade payables.
Refer Note 26 for further information on Financial Instruments.
NOTE 12: LEASE LIABILITIES
Current:
Lease Liability
Non-Current:
Lease Liability
Refer Note 26 for further information on Financial Instruments.
NOTE 13: OTHER CURRENT LIABILITIES
Current:
Partial proceeds from placement completed in July 2020
NOTE 14: INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD
Investment in Joint Ventures
2021
$
46,738
46,738
82,797
82,797
2021
$
-
-
2021
$
65,000
65,000
2020
$
-
-
-
-
2020
$
485,000
485,000
2020
$
-
-
Refer Note 28 for further information on investments accounted for using the equity method.
Page 52
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2021
NOTE 15: PROVISIONS
Rehabilitation provision
2021
$
201,324
201,324
2020
$
-
-
On 24 June 2020 the Company announced that it had executed binding agreements with Peabody (Burton Coal) Pty Ltd
(“Peabody”), a wholly owned subsidiary of US headquartered Peabody Energy Corporation, to acquire the Broadmeadow
East coking coal project, located within undeveloped Mining Lease 70257 (“ML”, “Project” or “Broadmeadow East”).
The transaction includes access rights to both the New Lenton Joint Venture Coal Handling and Preparation Plant (“CHPP”)
and the Train Load Out Facility (“TLO”), which are connected by an established haul road passing immediately adjacent
to ML 70257. The Company has secured throughput capacity of a minimum of 1Mtpa, with the ability to potentially increase
this capacity to a total of 2Mtpa, subject to agreement.
Total consideration payable for the above-mentioned assets included assumption of environmental rehabilitation
obligations. The provision represents the presents the estimated costs of future rehabilitation of this asset.
NOTE 16: CONTRIBUTED EQUITY
Fully paid ordinary shares
Balance at the beginning of the year
803,762,262
56,399,643
706,274,262
53,398,058
2021
2020
No. of
Shares
$
No. of
Shares
$
Share issues:
Placement - 7 August 2019
Conversion of Class A performance shares -
19 August 2019
Exercise of 2.0c options: July to October 2019
Exercise of 4.0c options: July to October 2019
Placement – 3 July 2020
Placement – 9 November 2020
Exercise of 2.5c options: 12 December 2020
Exercise of 3.0c options: 12 December 2020
Exercise of 3.5c options: 12 December 2020
Exercise of 3.38c options: February to June
2021
Performance rights conversion
(a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)
(i)
(j)
(k)
-
-
-
-
-
-
-
-
10,000,000
500,000
13,000,000
24,488,000
89,700
489,760
50,000,000
2,000,000
45,000,000
2,250,000
60,000,000
3,000,000
10,000,000
10,000,000
10,000,000
250,000
300,000
350,000
35,700,000
1,206,660
4,000,000
332,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(77,875)
Transaction costs associated with share issues
-
(170,894)
Balance as at 30 June
978,462,262
63,917,409
803,762,262
56,399,643
Ordinary shareholders are entitled to participate in dividends and the proceeds on the winding up of the company in
proportion to the number of and amount paid on the shares held. Every ordinary shareholder present at a meeting in person
or by proxy is entitled to one vote on a show of hands or by poll. Ordinary shares have no par value.
Page 53
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2021
NOTE 16: CONTRIBUTED EQUITY (Continued)
Notes for the above table:
(a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)
(i)
(j)
(k)
10,000,000 shares issued at $0.05 each in the placement on 7 August 2019, raising $500,000.
13,000,000 Class A performance shares with a fair value of $89,700 converted into ordinary
shares at no consideration.
24,488,000 shares were issued upon exercise of options at $0.02 each between July and October
2019, raising $489,760.
50,000,000 shares were issued upon exercise of options at $0.04 each between July and October
2019, raising $2,000,000.
45,000,000 shares were issued at $0.05 each in the placement on 03 July 2020, raising
$2,250,000.
60,000,000 shares issued at $0.05 each in the placement on 9 November 2020, raising
$3,000,000.
10,000,000 shares were issued upon exercise of options at $0.025 each on 12 December 2020,
raising $250,000.
10,000,000 shares were issued upon exercise of options at $0.03 each on 12 December 2020,
raising $300,000
10,000,000 shares were issued upon exercise of options at $0.035 each on 12 December 2020,
raising $350,000.
35,700,000 shares were issued upon exercise of options at $0.0338 each between February 2021
to June 2021, raising $1,206,660.
4,000,000 performance rights with a fair value of $332,000 converted into ordinary shares at no
consideration.
Listed Options
Listed Share Options
Balance at the beginning of the year
Options exercised
Exercisable at end of year
Unlisted Options
Note
Weighted
average
exercise price
2021
No. of
Options
Weighted
average
exercise price
2020
No. of
Options
0.00
0.00
0.00
-
-
-
-
-
$0.04
50,000,000
-
$0.04
(50,000,000)
-
-
Unlisted Share Options
$0.074
3,400,000
$0.032
65,700,000
Note
Weighted
average
exercise price
2021
No. of
Options
Weighted
average
exercise price
2020
No. of
Options
Balance at the beginning of the year
$0.032
65,700,000
$0.029
90,378,000
Change of options during the year:
Issued during the year
Exercised during the year
Options lapsed
$0.074
$0.032
3,400,000
(65,700,000)
-
$0.02
$0.02
-
(24,488,000)
(190,000)
Exercisable at end of year
$0.074
3,400,000
$0.032
65,700,000
Page 54
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2021
NOTE 16: CONTRIBUTED EQUITY (Continued)
Performance Shares
Weighted
average
exercise price
Note
Weighted
average
exercise price
2021
No. of
Performance
Shares
-
-
-
-
-
-
-
-
-
-
-
-
Weighted
average
exercise price
Note
-
-
-
-
2021
No. of
Performance
Rights
20,000,000
12,000,000
12,000,000
(4,000,000)
20,000,000
Weighted
average
exercise price
-
-
-
-
-
2020
No. of
Performance
Shares
-
13,000,000
(13,000,000)
-
2020
No. of
Performance
Rights
12,000,000
-
-
12,000,000
-
12,000,000
Unlisted Performance Shares
Balance at the beginning of the year
Changes of Performance Shares
during the year:
Converted
Balance at end of year
Performance Rights
Unlisted Performance Rights
Balance at the beginning of the year
Changes of Performance Rights
during the year:
Issued
Converted
Balance at end of year
Capital Management
Exploration companies such as Bowen Coking Coal Ltd are funded almost exclusively by share capital.
Management controls the capital of the Group to ensure it can fund its operations and continue as a going
concern. Capital management policy is to fund its exploration activities principally by way of equity, and where
required, debt and/or project finance. No dividend will be paid while the Group is in exploration stage. There
are no externally imposed capital requirements.
There have been no other changes to the capital management policies during the year.
NOTE 17: RESERVES
Share-Based Payments Reserve
The share-based payment reserve is used to recognise the fair value of options and performance shares
issued to consultants. This reserve can be reclassified as retained earnings if options lapse.
Page 55
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2021
NOTE 18: OPERATING SEGMENTS
Segment Information
Identification of reportable segments
The Group has identified its operating segments based on the internal reports that are reviewed and used by
the Board of Directors (chief operating decision makers) in assessing performance and determining the
allocation of resources.
The Group is managed primarily on geographic basis, that is, the location of the respective areas of interest
(tenements) in Australia. Operating segments are determined on the basis of financial information reported to
the board of directors which is at the consolidated entity level. The Group does not have any products or
services that it derives revenue from. The Group’s exploration and development activities in Australia is the
Group’s sole focus.
Accordingly, management currently identifies the Group as having only one reportable segment, being the
exploration of mineral projects in Australia. There have been no changes in the reporting segments during the
year. Accordingly, all significant operating decisions are based upon analysis of the consolidated entity as one
segment. The financial results from this segment are equivalent to the financial statements of the Group as a
whole.
NOTE 19: CASH FLOW INFORMATION
A. Reconciliation of Cash Flow from Operations with Loss after Income
Tax:
Loss after income tax
Non-cash flows in loss from ordinary activities:
Amortisation and depreciation
Interest on lease payments
Share-based payments
Changes in operating assets and liabilities:
(Increase)/Decrease in receivables
(Increase)/Decrease in prepayments and other assets
Increase/(decrease) in payables and accruals
Increase/(decrease) in provisions
2021
$
2020
$
(3,224,368)
(2,057,812)
25,713
5,682
506,904
12,634
(3,293)
(45,615)
11,531
-
-
198,876
(74,814)
(4,069)
304,949
-
Net cash used in operations
(2,710,812)
(1,632,870)
Page 56
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2021
NOTE 20: EARNINGS PER SHARE
Net loss used in the calculation of basic and diluted EPS attributable to owners
of the parent company
Weighted average number of ordinary shares outstanding during the period
used in the calculation of basic EPS
Weighted average number of ordinary shares outstanding during the period
used in the calculation of diluted EPS
2021
$
2020
$
(3,224,368)
(2,057,812)
910,093,769
779,784,232
910,093,769
854,959,642
Options are considered potential ordinary shares. Options issued are not presently dilutive and were not
included in the determination of diluted earnings per share for the period.
NOTE 21: COMMITMENTS
(a) Exploration Commitments
The Group has certain obligations to expend minimum amounts on exploration in tenement areas. These
obligations may be varied from time to time and are expected to be fulfilled in the normal course of operations
of the Group.
The following commitments exist at balance date but have not been brought to account. If the relevant option
to acquire a mineral tenement is relinquished the expenditure commitment also ceases. The Group has the
option to negotiate new terms or relinquish the tenements and also to meet expenditure requirements by joint
venture or farm-in arrangements.
2021
$
2020
$
701,175
651,260
-
567,400
745,650
-
1,352,435
1,313,050
Not later than 1 year
Later than 1 year but not later than 5 years
Later than 5 years
Total commitment
(b) Operating Lease Commitments
The Group has no operating leases.
(c) Capital Commitments
The Group has no capital commitments.
Page 57
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2021
NOTE 22: CONTINGENT LIABILITIES
On 24 June 2020 the Company announced that it had executed binding agreements with Peabody (Burton
Coal) Pty Ltd (“Peabody”), a wholly owned subsidiary of US headquartered Peabody Energy Corporation, to
acquire the Broadmeadow East coking coal project, located within undeveloped Mining Lease 70257 (“ML”,
“Project” or “Broadmeadow East”).
The transaction includes access rights to both the New Lenton Joint Venture Coal Handling and Preparation
Plant (“CHPP”) and the Train Load Out Facility (“TLO”), which are connected by an established haul road
passing immediately adjacent to ML 70257. The Company has secured throughput capacity of a minimum of
1Mtpa, with the ability to potentially increase this capacity to a total of 2Mtpa, subject to agreement.
Assets being acquired
The Company has agreed to acquire the following from Peabody:
1. Granted Mining Lease ML 70257;
2. Land access for the purposes of exploration, development and mining; and
3. Assignment of 1Mtpa throughput capacity at (a) the New Lenton Joint Venture CHPP and (b) the New
Lenton Joint Venture TLO, with access to the haul road. The parties may agree the assignment of a
further potential 1Mtpa throughput capacity.
Consideration
Total consideration payable for the above-mentioned assets is as follows:
1. Cash consideration of $1,000,000, payable upon completion;
2. Assumption of environmental rehabilitation obligations;
3. Royalty payable of $1/t on all coal produced and sold from ML 70257, to a maximum of 1.5Mt, being
$1.5M; and
4. $500,000 cash consideration for land compensation, payable only upon site works commencing or the
renewal of the ML, whichever occurs first.
The acquisition was completed on 30 September 2020, with the cash consideration being paid and the
assumption of the environmental rehabilitation obligation (recorded in the accounts as a provision). Items 3
and 4 above remain contingent liabilities.
There were no other contingent liabilities at the end of the reporting period.
Page 58
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2021
NOTE 23: RELATED PARTY TRANSACTIONS
Parent Entity
Bowen Coking Coal Ltd is the legal parent and ultimate parent entity of the Group.
Subsidiary
Interest in subsidiaries are disclosed in Note 27.
Key Management Personnel
Short-term employee benefits
Share-based payments
Provision for leave entitlements
2021
$
1,051,762
145,434
17,978
1,215,174
2020
$
777,688
64,644
29,699
872,031
During the year the consolidated entity paid M Resources Trading Pty Ltd, an entity associated with Mr M.
Latimore, $169,690 (2020: $nil) for marketing consulting and technical services. At reporting date there was
no outstanding amount payable to M Resources Trading Pty Ltd.
At reporting date there was an amount outstanding to Protea Resources Pty Ltd of $20,213 (2020: $nil), an
entity associated with Mr Daryl Edwards for consulting fees due.
At reporting date there was an amount outstanding to Gerhard Redelinghuys of $1,228 (2020: $nil) for expense
reimbursements due.
NOTE 24: SHARE-BASED PAYMENTS
Director and Employee Share-based Payments
Share-based payment expense recognised during the year:
Share-based payment expense recognised during the period:
Options issued to directors (1)
Options issued to Bizzell Capital (2)
Performance rights issued to a consultant (3)
2021
$
30,763
25,350
450,791
506,904
2020
$
64,644
-
134,232
198,876
Notes for the above table, relating to the years ended 30 June 2021 and 30 June 2020 are:
1. 30,000,000 options were granted to a director for nil consideration on 12 December 2018. The
options vested on 12 December 2019 and expire on 12 December 2020. 10,000,000 options have
an exercise price of $0.025, 10,000,000 options have an exercise price of $0.03 and 10,000,000
options have an exercise price of $0.035. 2,100,000 options with an exercise price of $0.07 were
granted to a director for nil consideration on 11 November 2020. The options vested on grant date
and expire on 31 December 2022.
2. 1,300,000 options with an exercise price of $0.08 were granted to a Bizzell Capital on 03 July 2020.
The options vested on grant date and expire on 30 September 2023.
3. 12,000,000 performance rights which have various vesting conditions, performance hurdles and
expiry dates were granted to a consultant on 16 September 2019. 12,000,000 performance rights
were granted to the Chief Financial Officer on 2 February 2021.
Page 59
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2021
NOTE 25: AUDITOR’S REMUNERATION
Remuneration for the auditor of the parent entity:
RSM Australia Partners and its related entities:
Auditing or reviewing the financial reports
Taxation services
NOTE 26: FINANCIAL INSTRUMENTS
(a) Financial Risk Management Policies
2021
$
40,750
-
40,750
2020
$
34,135
6,500
40,635
The Group's financial instruments comprises cash balances, receivables and payables and loans to and from
subsidiaries. The main purpose of these financial instruments is to provide finance for Group operations.
Treasury Risk Management
Key executives of the Company meet on a regular basis to analyse exposure and to evaluate treasury
management strategies in the context of the most recent economic conditions and forecasts.
The board of directors has overall responsibility for the establishment and oversight of the Group's risk
management framework. Management is responsible for developing and monitoring the risk management
policies and reports to the board.
Financial Risks
The main risks the Group is exposed to through its financial instruments are interest rate risk, foreign currency
risk, credit risk and liquidity risk. These risks are managed through monitoring of forecast cash flows, interest
rates, economic conditions and ensuring adequate funds are available.
Interest Rate Risk
The Group's exposure to interest rate risk, which is the risk that a financial instrument's cash flows or fair value
will fluctuate as a result of changes in market interest rates, arises in relation to the Group's bank balances.
This risk is managed through the use of variable rate bank accounts.
Liquidity Risk
Liquidity risk is the risk that the Group will not be able meet its financial obligations as they fall due. This risk
is managed by ensuring, to the extent possible, that there is sufficient liquidity to meet liabilities when due,
without incurring unacceptable losses or risking damage to the Group's reputation.
The Group's activities are funded from equity and where required and available debt and/or project finance.
During the year ended 30 June 2020, the Group executed a finance facility with M Resources Trading Pty Ltd
(“M Resources”), a related entity of Mr Matt Latimore (a director and substantial holder of the Company), to
provide the Group with a finance facility of up to $15.0 million, to be utilised in funding the development of the
Group’s Isaac River Coking Coal Project, or any other of the Group’s coking coal projects, as the case may
be. The Group may draw down on the finance facility in respect of a particular project once the decision to
mine that project has been made, and the finance facility will be secured against the project being developed.
At the date of this report, the finance facility remains undrawn.
Page 60
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2021
NOTE 26: FINANCIAL INSTRUMENTS (Continued)
(a) Financial Risk Management Policies (Continued)
Credit Risk
The maximum exposure to credit risk, excluding the value of any collateral or other security, at balance date
to recognised financial assets, is their carrying amount, net of any provisions for impairment of those assets,
as disclosed in the statement of financial position and notes to the financial statements.
Credit risk arises from exposures to deposits with financial institutions and sundry receivables.
Credit risk is managed and reviewed regularly by key executives. The key executives monitor credit risk by
actively assessing the rating quality and liquidity of counter parties:
▪ only banks and financial institutions with an ‘A’ rating are utilised; and
▪ all other entities are rated for credit worthiness taking into account their size, market position and
financial standing.
At 30 June 2021, there was no concentration of credit risk, other than bank balances.
Foreign Currency Risk
The Group has no material exposure to foreign currency risk at the end of the reporting period.
(b) Financial Instrument Composition and Contractual Maturity Analysis
The following tables detail the consolidated entity's remaining contractual maturity for its financial instrument
liabilities. The tables have been drawn up based on the undiscounted cash flows of financial liabilities based
on the earliest date on which the financial liabilities are required to be paid. The tables include both interest
and principal cash flows disclosed as remaining contractual maturities and therefore these totals may differ
from their carrying amount in the statement of financial position.
Within 12 months:
Payables (1)
Lease liability(2)
Between 12 months and 24 months:
Lease liability(2)
Between 24 months and 36 months:
Lease liability(2)
Notes:
2021
$
814,888
55,440
870,328
58,312
29,886
2020
$
643,414
-
643,414
-
-
(1) Non-interest bearing. The contractual cash flows do not differ to the carrying amount.
(2) The Group has recognised a lease liability in relation to premises the entity leases for its corporate office under a
three year agreement commencing on 1 January 2021.
(c) Net Fair Values
Fair values of financial assets and financial liabilities are materially in line with carrying values.
(d) Sensitivity Analysis
The Company has performed sensitivity analysis relating to its exposure to interest rate risk. At year end, the
effect on profit and equity as a result of a 10% change in the interest rate, with all other variables remaining
constant, is immaterial.
Page 61
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2021
NOTE 27: SUBSIDIARIES
The consolidated financial statements incorporate the assets, liabilities and results of the following wholly-
owned subsidiaries in accordance with the accounting policy described in Note 1:
Coking Coal One Pty Ltd
Cabral Metais Ltd (dormant)
NOTE 28: JOINT VENTURES
Country of
incorporation
Australia
Brazil
Ownership interest
2021
100%
100%
2020
100%
100%
On 23 March 2020 the Company entered into an Umbrella Deed with M Resources Trading Pty Ltd, Latimore
Family Pty Ltd and Latimore Finance Pty Ltd (Latimore Parties) which sets out the terms of a 50/50 joint venture
arrangement between the Company and the Latimore Parties.
In accordance with the Umbrella Deed the parties have registered Bowen Coking Coal Marketing Pty Ltd
(Marketing Co) as a joint venture coal marketing vehicle, of which the Company and the Latimore Parties are
shareholders in equal proportion. Marketing Co. will market, promote and sell, all coking coal produced by and
from any of the Company’s existing wholly owned coking coal portfolio as well as third party coal for blending
purposes. M Resources Trading Pty Ltd will provide marketing support services to Marketing Co.
Interests in joint ventures are accounted for using the equity method of accounting. Information relating to
Marketing Co joint venture is set out below:
Percentage ownership interest
Non-current assets
Current assets
Non-current liabilities
Current liabilities
Net assets (100%)
Consolidated entity’s share of net assets
Carrying amount of interest in associate
Revenue
Loss from continuing operations (100%)
Total comprehensive income/(loss) (100%)
Consolidated entity’s share of total comprehensive income/(loss)
2021
$
50%
2020
$
50%
-
3,000
(133,000)
-
(130,000)
50%
(65,000)
(130,000)
(130,000)
(65,000)
-
-
-
-
-
-
-
-
-
-
Page 62
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2021
NOTE 29: SUBSEQUENT EVENTS
On 30 July 2021 the Company announced that it had been awarded preferred bidder status in the sale process
for the Bluff PCI Mine. The Company has entered into a terms sheet pursuant to which it has paid a $250,000
deposit, which provided exclusive rights to conduct detailed due diligence over a period of 4 weeks and to
advance towards binding transaction documents.
On 4 August 2021 the Company announced that it had signed a Binding Term Sheet with New Hope
Corporation Limited (‘NHC’) to acquire 100% of the shares in New Lenton Coal Pty Ltd (‘New Lenton’) (which
currently owns a 90% interest in the Lenton Joint Venture) (‘Lenton JV’, the ‘Acquisition’). The Company has
agreed to pay New Hope Corporation a $20,000,000 upfront payment (of which $500,000 was paid upon
signing of the Binding Term Sheet and up to $10,000,000 can be in Bowen Coking Coal Limited shares at the
Company’s election); up to $7,500,000 in deferred milestone payments linked to both production ramp-up and
time-based payments (24 and 36 months) plus up to $70,000,000 in predominantly price-linked royalty
payments on 90% of all coal produced from the Lenton Joint Venture.
The transaction is conditional upon:
-
New Hope Corporation and Bowen Coking Coal finalising and entering into formal transaction
documents to give effect to the Binding Term Sheet;
Bowen Coking Coal (and, potentially, New Hope Corporation) agreeing acceptable commercial
arrangements with MPC Lenton Pty Ltd, a subsidiary of Formosa Plastics Group (“Formosa’) in relation
to the future ownership, operation and funding arrangements for the Lenton Joint Venture assets; and
acceptable arrangements being put in place under the Queensland Financial Provisioning regime for
resources projects in respect of the outstanding Burton rehabilitation obligations.
-
-
The formal documents will provide that completion is subject to Bowen Coking Coal Limited shareholder
approvals required under the ASX Listing Rules.
On 5 August 2021 the Company issued 2,700,000 fully paid ordinary shares on the exercise of unlisted options,
with 2,100,000 shares issued at $0.07 and 600,000 shares issued at $0.08 per share.
On 10 August 2021 the Company completed a private placement of 149,253,731 shares at $0.067 per share,
raising $10,000,000.
On 30 August 2021, the Company completed an Entitlement Offer (‘Offer’), being a fully underwritten pro-rata
non-renounceable entitlement issue of Shares, of 1 New Share for every 12 Shares held by Eligible
Shareholders on the Record Date, at an Issue Price of $0.067 per New Share, to raise $5,478,185 (before
costs of the Offer). Accordingly on the same date, the Company issued 81,763,969 new shares at $0.067 per
share.
In addition, on 30 August 2021 the Company applied for the issue 30,000,000 unlisted options each
exercisable at $0.10 per share on or before 31 August 2024. 21,000,000 unlisted options were issued on this
date with a further 9,000,000 unlisted options to be issued at a future date subject to shareholder approval.
During the reporting period the outbreak of what is known as the COVID-19 pandemic continued to spread,
resulting in significant volatility with worldwide economies as well as there being Government imposed social
distancing guidelines. Subsequent to the reporting period the COVID-19 pandemic has remained prevalent,
and this may impact the results of operations of the Company in future reporting periods. Given the stage of
the pandemic, the company is not in a position to reliably estimate this impact.
Other than the matters noted above, there are no material matters or circumstances that have arisen since the
end of the year which significantly affected or may significantly affect the operations of the Group, the results
of those operations, or the state of affairs of the Group in future financial years.
Page 63
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Notes to the Consolidated Financial Statements for the Year Ended 30 June 2021
NOTE 30: PARENT ENTITY INFORMATION
The following information relates to the parent entity, Bowen Coking Coal Ltd at 30 June 2021. This information
has been prepared using consistent accounting policies as presented in Note 1.
Current assets
Non-current assets
Total assets
Current liabilities
Non-current liabilities
Total liabilities
Net assets
Contributed equity
Reserves
Accumulated losses
Total equity
Loss for the period
Other comprehensive income for the period
Total comprehensive loss for the period
2021
$
2020
$
1,172,888
14,460,232
2,165,316
9,012,974
15,633,120
11,178,290
601,372
82,797
684,169
771,246
-
771,246
14,948,951
10,407,044
63,917,409
56,399,643
755,943
581,039
(49,724,401)
(46,573,638)
14,948,951
10,407,044
(3,150,763)
(2,174,485)
-
-
(3,150,763)
(2,174,485)
Refer to Note 22 outlining a (conditional) contractual commitment for the acquisition of a project, also
considered a contingent liability at 30 June 2021. Other than the transaction described in Note 22, the
Company has:
-
-
no other contingent liabilities, nor has it entered into any guarantees in relation to the debts of its
subsidiaries; and
has not entered into any other contractual commitments for the acquisition of property, plant and
equipment.
The Company and its Australian controlled entities have formed a tax consolidated group as at the date of this
report.
NOTE 31: COMPANY DETAILS
The registered office and principal place of business is:
Level 7, 167 Eagle Street
Brisbane, Queensland, 4000 Australia
NOTE 32: DIVIDENDS & FRANKING CREDITS
There were no dividends paid or recommended during the financial year. There are no franking credits
available to the shareholders of the Company.
Page 64
BOWEN COKING COAL LTD - ACN 064 874 620
ANNUAL REPORT 2021
Directors’ Declaration
The directors of the Company declare that:
1. The attached financial statements and notes are in accordance with the Corporations Act 2001, the
Corporations Regulations 2001, including:
a. complying with the Australian Accounting Standards which, as stated in accounting policy note
1 to the financial statements, constitutes explicit and unreserved compliance with International
Financial Reporting Standards (IFRS); and
b. giving a true and fair view of the consolidated entity’s financial position as at 30 June 2021
and of its performance for the financial year ended on that date.
2. The Managing Director and chief financial officer have each declared that:
a.
b.
the financial records of the Company for the financial year have been properly maintained in
accordance with section 286 of the Corporations Act 2001;
the financial statements and notes for the financial year comply with the Accounting
Standards; and
c.
the financial statements and notes for the financial year give a true and fair view.
3.
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.
This declaration is made in accordance with a resolution of the board of directors.
Gerhard Redelinghuys
Managing Director
Dated 23 September 2021
Brisbane, Queensland
Page 65
INDEPENDENT AUDITOR’S REPORT
To the Members of Bowen Coking Coal Limited
Opinion
We have audited the financial report of Bowen Coking Coal Limited (the Company) and its subsidiaries (the
Group), which comprises the consolidated statement of financial position as at 30 June 2021, the consolidated
statement of comprehensive income, the consolidated statement of changes in equity and the consolidated
statement of cash flows for the year then ended, and notes to the financial statements, including a summary of
significant accounting policies, and the directors' declaration.
In our opinion the accompanying financial report of the Group is in accordance with the Corporations Act 2001,
including:
(i) giving a true and fair view of the Group's financial position as at 30 June 2021 and of its financial
performance for the year then ended; and
(ii) complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those
standards are further described in the Auditor's Responsibilities for the Audit of the Financial Report section of
our report. We are independent of the Group in accordance with the auditor independence requirements of the
Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board's
APES 110 Code of Ethics for Professional Accountants (the Code) that are relevant to our audit of the financial
report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has been given to
the directors of the Company, would be in the same terms if given to the directors as at the time of this auditor's
report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
Page 66
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 and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
Key Audit Matter
Carrying Value of Capitalised Exploration Expenditure
Refer to Note 8 in the financial statements
The Group
exploration
expenditure with a carrying value of $12,648,191
as at 30 June 2021.
capitalised
has
How our audit addressed this matter
Our audit procedures in relation to the carrying value
of capitalised exploration costs included:
the significant management
We determined this to be a key audit matter due
to
judgement
involved in assessing the carrying value in
accordance with AASB 6 Exploration for and
Evaluation of Mineral Resources, including:
Determination of whether expenditure can
be associated with finding specific mineral
resources, and the basis on which that
expenditure is allocated to an area of
interest;
Assessing whether any
indicators of
impairment are present; and
Determination of whether exploration
activities have progressed to the stage at
which the existence of an economically
recoverable mineral
reserve may be
determined.
Going concern
The financial statements have been prepared on
a going concern basis using managements
critical accounting estimates and judgements as
outlined in Note 1.
In the current financial year, the Group recorded
a total comprehensive loss of $3,224,368 in the
consolidated statement of profit or loss and other
comprehensive income and incurred operating
cash outflows of $2,710,812.
We considered the going concern assumption a
key audit matter as there is inherent uncertainty
associated with estimates and
judgements
associated with the Group’s stage in operations
and the going concern assumption relies on
existing working capital, planned operations and
uncertain future events generating sufficient
cashflows to cover necessary expenditures.
Page 67
Ensuring that the right to tenure of the areas of
interest was current through confirmation with
the relevant government departments;
Critically
assessing
evaluating
management’s assessment that no indicators of
impairment existed;
and
Agreeing a sample of the additions to capitalised
exploration expenditure during
to
supporting documentation, and ensuring that the
amounts were capitalised correctly; and
the year
Through discussions with the Group’s Directors,
and review of the Group’s ASX announcements
and other relevant documentation, assessing
management’s determination that exploration
activities have not yet progressed to the point
the existence or otherwise of an
where
economically recoverable mineral resource may
be determined.
In assessing the appropriateness of the going concern
assumption used
financial
statements, our procedures included, amongst others:
in preparing
the
We considered the cashflow requirements of the
Group for the period until 30 September 2022
based on budgets and forecasts;
We gained an understanding of what budgeted
expenditures are committed and what could be
considered discretionary;
We considered potential downside scenarios of
resultant
management assumptions and
impact on available funds;
the
We tested the mathematical accuracy of the
Group’s forecasts;
We inspected bank statements after year end to
confirm that funds were received for the capital
raisings that occurred in July and August 2021;
We considered whether the disclosures in the
financial statements were in compliance with
accounting standards.
Other Information
The directors are responsible for the other information. The other information comprises the information included
in the Group's annual report for the year ended 30 June 2021 but does not include the financial report and the
auditor's report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not express any
form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information and, in doing
so, consider whether the other information is materially inconsistent with the financial report or our knowledge
obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of the Directors for the Financial Report
The directors of the Company are responsible for the preparation of the financial report that gives a true and fair
view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal
control as the directors determine is necessary to enable the preparation of the financial report that gives a true
and fair view and is free from material misstatement, whether due to fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the Group to continue as
a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of
accounting unless the directors either intend to liquidate the Group or to cease operations, or have no realistic
alternative but to do so.
Auditor's Responsibilities for the Audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from
material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion.
Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance
with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements
can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably
be expected to influence the economic decisions of users taken on the basis of this financial report.
A further description of our responsibilities for the audit of the financial report is located at the Auditing and
Assurance Standards Board website at: https://www.auasb.gov.au/auditorsresponsibilities/ar2.pdf.
This description forms part of our auditor's report.
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 20 to 25 of the directors' report for the year ended
30 June 2021.
In our opinion, the Remuneration Report of Bowen Coking Coal Limited, for the year ended 30 June 2021,
complies with section 300A of the Corporations Act 2001.
Page 68
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the Remuneration Report
in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the
Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards.
RSM AUSTRALIA PARTNERS
Brisbane, Queensland
Dated: 23 September 2021
Albert Loots
Partner
Page
69