ANNUAL REPORT
FOR THE FINANCIAL YEAR ENDED
31 DECEMBER 2019
CONTENTS
CORPORATE DIRECTORY
DIRECTORS’ REPORT
REMUNERATION REPORT
AUDITOR’S INDEPENDENCE DECLARATION
CORPORATE GOVERNANCE STATEMENT
CONSOLIDATED STATEMENT OF PROFIT AND LOSS AND OTHER
COMPREHENSIVE INCOME
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
CONSOLIDATED STATEMENT OF CASH FLOWS
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
DIRECTORS’ DECLARATION
INDEPENDENT AUDITOR’S REPORT
ADDITIONAL SHAREHOLDERS’ INFORMATION
PAGE
2
3
12
17
18
19
20
21
22
23
49
50
54
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 1
CORPORATE DIRECTORY
NON-EXECUTIVE CHAIRMAN
Michael Fry
MANAGING DIRECTOR
David Prentice
NON-EXECUTIVE DIRECTOR
Richard Homsany
COMPANY SECRETARY
Loren King
REGISTERED OFFICE
Suite 9, 330 Churchill Avenue
Subiaco WA 6008
POSTAL ADDRESS
PO Box 866
Subiaco WA 6904
PRINCIPAL PLACE OF BUSINESS
Suite 9, 330 Churchill Avenue
Subiaco WA 6008
Tel: (08) 6489 1600
Fax: (08) 6489 1601
Email: info@brookside-energy.com.au
WEBSITE
www.brookside-energy.com.au
AUDITORS
HLB Mann Judd (WA Partnership)
Level 4, 130 Stirling Street
Perth WA 6000
BANKERS
Commonwealth Bank of Australia
150 St Georges Terrace
Perth WA 6000
SHARE REGISTRY
Automic Registry Services
Level 2, 267 St Georges Terrace
Perth WA 6000
Tel: 1300 288 664 (Local)
Tel: (02) 9698 5414 (International)
Email: www.automic.com.au
SECURITIES EXCHANGE LISTING
Australian Securities Exchange
Level 40, Central Park
152-158 St George's Terrace
Perth WA 6000
ASX CODE
BRK
(Ordinary Fully Paid Shares)
BRKOA (Quoted Options exercisable at $0.03
on or before 31 December 2020)
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 2
DIRECTORS’ REPORT
The Directors submit their report for the Company and its subsidiaries (Group or Company) for the
financial year ended 31 December 2019. In order to comply with the provisions of the Corporations
Act, the directors’ report is as follows:
DIRECTORS
The names and details of the Company’s directors in office during the financial year and until the date
of this report are as follows. Directors were in office for the entire period unless otherwise stated.
Name
Michael Fry
David Prentice
Position
Independent Chairman
Managing Director
Richard Homsany
Non-Executive Director, appointed 3 February 2020
Loren King
Non-Executive Director, retired 3 February 2020
NATURE OF OPERATIONS AND PRINCIPAL ACTIVITIES
The Group’s principal activities during the year were the exploration, production and appraisal of oil
and gas projects.
OPERATING RESULT
The after-tax profit for the Group for the financial year ended 31 December 2019 amounted to
$917,503 (2018: ($1,217,780)).
DIVIDENDS
There were no dividends paid or recommended during or subsequent to the financial year ended 31
December 2019 (2018: Nil).
REVIEW OF OPERATIONS
During the full year ended 31 December 2019, the Company continued to successfully pursue its
efforts to create shareholder value by developing oil and gas assets in the world-class STACK and
SCOOP Plays in the Anadarko Basin in Oklahoma, USA.
Brookside is executing a “Real Estate Development” approach to acquiring prospective acreage
in the Anadarko Basin and adding value to it by consolidating leases and proving up oil and gas
reserves. The Company then has the option of selling the revalued acreage or maintaining a
producing interest. This model is commonly used by private equity investors in the sector and has
been successfully piloted by Brookside and its US partner and manager of operations, Black Mesa
Energy, LLC (Black Mesa) in the northern Anadarko Basin’s STACK Play.
Black Mesa is an experienced mid-continent operator, which identifies opportunities and
executes the acquisition and development of these opportunities under a commercial
agreement with Brookside. This business model effectively assigns risk and provides commercial
incentives to maximise value for both parties.
Brookside Energy Limited has now scaled-up its asset base significantly with its interests in its SWISH
AOI, which is located in the SCOOP Play.
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
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DIRECTORS’ REPORT
Anadarko Basin, Oklahoma
The Anadarko Basin is a geologic depositional and structural basin centred in the western part of
Oklahoma that is oil and gas rich, and generally well explored (mature).
The basin is a proven tier-one oil and gas development province with significant existing oil and
gas gathering and transportation infrastructure, a competitive and highly experienced oil and
gas service sector, and a favourable regulatory environment.
Recent activity (last six years) has been focussed primarily on two world-class oil and gas plays –
STACK and SCOOP. The STACK (Sooner Trend, Anadarko Basin, Canadian and Kingfisher
Counties) and SCOOP (South Central Oklahoma Oil Province) Plays are being developed using
modern horizontal drilling and completion techniques targeting the Mississippian aged formations
(that sit above the Woodford Shale) and the Woodford Shale itself (the organic rich source rock
for the hydrocarbons in the basin).
The SWISH AOI is an area of interest in the core of the SCOOP Play, identified and named by
Brookside’s partner and manager of US operations, Black Mesa (see Figure 1.)
Figure 1. Anadarko Basin, Oklahoma (STACK & SCOOP Plays)
Anadarko Basin Leasing and Acquisition Activities
During the year the Company continued to successfully execute its land and leasing focused
strategy targeting acreage within the SWISH AOI in the SCOOP Play. Significant progress
continues to be made on this front with recent activity focused on securing operations on several
high-grade core Drilling Spacing Units (DSUs).
As at 31 December 2019 the Company had acquired approximately 3,000 net Working Interest
acres spread across four counties in south western Oklahoma (Blaine, Garvin, Stephens and
Carter counties). This includes approximately 700 net acres that are held by production and 2,300
net leasehold acres.
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
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DIRECTORS’ REPORT
Activity within the SWISH AOI continued to increase during the period, with five rigs currently
drilling horizontal wells (Sycamore-Woodford) in the SWISH AOI.
The Sycamore-Woodford sub-play in southern SCOOP has gone from a concept (based on results
from historical vertical wells and examination of old logs and drill core) to “proof of concept” in
a very short time and the Company has been able to secure a strategic holding in this area at a
modest cost.
The Company’s successful leasing, trading and high-grading activities have now delivered three
DSUs (Jewell, Rangers and Flames) in the core of the SWISH AOI.
The Oklahoma Corporation Commission (OCC) has issued orders in respect of the Jewell, Rangers
and Flames DSUs. The Jewell DSU has been established as an 880-acre unit and the Company
has acquired approximately 84% Working Interest in this DSU. The Rangers DSU has been pooled
as a 640-acre unit and the Company expects to secure up to 91% Working Interest in this DSU
(post-pooling), while the Flames DSU has been spaced as a 960-acre unit and to date the
Company has secured (pre-pooling) approximately 64% of the Working Interest acres available
in the unit.
The Rangers, Flames and Jewell DSUs are all located in the core of the Sycamore-Woodford sub-
play in southern SCOOP in very close proximity to some of the best wells drilled and completed
in this area since its emergence as a focus for several of the tier-one independents, including
Continental Resources, Inc. (NYSE:CLR) and Ovintiv Inc. (NYSE:OVV).
Of particular note are the Flash 1-8-5MXH well (IP24 1,978 barrels of oil equivalent) and the
Courbet 1-27-22XHW well (IP24 1,621 barrels of oil equivalent). These wells are situated between
the Rangers DSU and the Flames and Jewell DSUs in a six-mile by six-mile area within the SWISH
AOI. See Figure 2. below.
Figure 2. SWISH AOI (Brookside DSUs and Drilling and Completion Activity)
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
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DIRECTORS’ REPORT
Acreage High-Grading, Trading and Divestment Activities
During the period the Company continued to generate important working capital and growth in
its asset base through the successful execution of its acreage high-grading, trading and
divestment activities in the SCOOP Play.
The Company was able to generate a premium on its acreage acquisition costs and re-invest
this capital on leasing within core DSUs as well monetising portions of its producing asset base via
the sale of well bore interests in producing wells.
During the period the Company received gross proceeds of US$2,141,051 from these activities.
Drilling and Completion Activities
The Company now has an interest in forty-three horizontal wells, targeting the productive
formations of the Anadarko Basin in both the STACK and SCOOP Plays) (see Table 1. below).
Note: Working Interest percentages may change subject to the issue of final pooling orders.
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
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DIRECTORS’ REPORT
The Company’s non-operated Working Interest wells continued to deliver excellent sustained
production rates providing further support for the quality of the acreage that Brookside has been
able to secure within the Anadarko Basin in Oklahoma.
Drilling and Completion activity within the SWISH AOI ramped-up significantly during the period
with a number of initial production rates reported for horizontal wells successfully drilled and
completed in either the Sycamore or Woodford formations. The table below details initial
production rates and/or status of the fifteen wells recently drilled or completed for production
within the SWISH AOI.
The Company now has data (reported IP24s) for ten “new generation” horizontal wells drilled and
completed in the SWISH AOI. This includes six wells targeting the Sycamore formation and four
wells targeting the Woodford formation. Importantly, all of these wells have been drilled and
completed within the last 20-months and this represents all of the wells drilled in this period.
Remarkably, seven of these wells produced IP24s above 1,600 barrels of oil equivalent which is
approximately 23% above our pre-drill estimates for the SWISH AOI.
Oil and Gas Production and Revenue
Oil and gas production and sales continued during the period, with volumes coming from a mix
of Drilling Joint Venture wells and from wells funded by Brookside Energy Limited. Net production
(volumes attributable to the Company’s Working Interest and net of royalties) is summarised
below.
Description
Total
Net Oil Volume (Bbls)
Net Gas Volumes (Mcf)
Net Volume (BOE)
Average Daily Production
26,701
413,629
95,639
262
During the period the Company received net proceeds from oil and gas sales of US$1,520,909
(AU$2,187,313).
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
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DIRECTORS’ REPORT
CORPORATE
Board Changes
The Board welcomed Mr Richard Homsany to the Board in the role of Non-Executive Director on
3 February 2020. Richard is an experienced corporate lawyer and Certified Practising Accountant
(CPA) with significant experience in the resources and energy sectors. Coinciding with Richard’s
appointment was the retirement of Mrs Loren King as Non-Executive Director. Loren continues her
position as Brookside’s company secretary.
Anadarko Leasing Facility
During the period, the Company repaid US$69,000 (AU$100,000) from this facility, with the drawn
amount as at 31 December 2019 reducing to US$2,887,768 (AU$4,112,459). The balance
available under the facility now stands at US$1,112,232 (AU$1,583,924).
STACK-A Drilling Joint Venture
As previously announced, this Joint Venture has funded Brookside’s participation in a total of
thirteen wells for a total cost (drilling and completion) of US$4,700,000. Maximum drawdown
under the joint venture was US$3,700,000, with the balance funded from revenue received from
the joint venture wells which was subsequently re-invested.
During the period proceeds from oil and gas sales from the joint venture wells were returned to
the joint venture. The total amount returned to the joint venture to date is US$1,060,000, reducing
the drawn amount to US$2,640,000 as at 31 December 2019. The parties do not intend to make
further drawdowns via the joint venture and revenue received from the joint venture wells will be
returned to the joint venture on a quarterly basis. The joint venture owns the net revenue stream
that is generated from the joint venture wells and the income stream is split as follows; 100% of
net revenue from the joint venture wells until 100% of the capital it has contributed is repaid, and
thereafter 25% of net revenue from the joint venture wells for the life of the wells.
Annual General Meeting (AGM)
The Australian Securities Investment Commission (ASIC) has adopted a two-month ‘no-action’
position for entities with a financial year end of 31 December 2019 that do not hold their AGM by
31 May 2020 due to ongoing issues with the COVID-19 breakout. This ‘no-action’ position means
that ASIC will not take action against an entity with a financial year end of 31 December 2019
who fails to comply with s250N(2) of the Corporations Act 2001 provided the entity holds the AGM
by 31 July 2020 or such later date as ASIC advises (‘extension period’).
As Brookside falls into this category of entity, the Company has decided to take advantage of
this position and postpone its upcoming annual general meeting (AGM). The Company will
advise the market as soon as a date for the AGM has been confirmed.
SUBSEQUENT EVENTS
The Company announced on 16 January 2020, significant initial production results from wells that have
recently been drilled and completed adjacent to the Company’s DSUs in the SWISH AOI.
On 3 February 2020, the Company announced the appointment of Non-Executive Director Mr Richard
Homsany.
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
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DIRECTORS’ REPORT
The Company announced on 27 February 2020, it had secured two additional operated DSUs in the
SWISH AOI.
Post balance date, we have seen the emergence of significant uncertainty in the global investment
environment as a result of the spread of COVID-19. This uncertainty and the impact that a global
slowdown in economic activity would have on demand has caused abnormally large volatility in
commodity markets, including the price of oil and gas. The scale and duration of these developments
remain uncertain but may impact our future earnings, cash flow and financial conditions.
No other matters or circumstances have arisen since the end of the full year which significantly
affected or could significantly affect the operations of the Company, the results of these operations,
or the state of affairs of the Company in future financial years.
ENVIRONMENTAL REGULATIONS
The Company is aware of its environmental obligations with regards to these activities and ensured
that it complied with all regulations. There have not been any known breaches of the entity’s
obligations under these environmental regulations during the year under review and up to the date
of this report.
INFORMATION ON DIRECTORS
Michael Fry
Qualifications
Experience
Other
Directorships
David Prentice
Qualifications
Experience
Other
Directorships
Non-Executive Chairman
B.Comm, F.Fin
Michael Fry holds a Bachelor of Commerce degree from the University of Western
Australia, is a Fellow of the Financial Services Institute of Australasia, and is a past
member of the ASX. Michael has extensive experience in capital markets and
corporate treasury management specialising in the identification of commodity,
currency and interest rate risk and the implementation of risk management
strategies.
Michael Fry is currently the non-executive chairman of ASX Listed Technology
Metals Australia Limited (ASX:TMT).
Managing Director
Grad. Dip BA, MBA
David is a senior resources executive with 26 plus years domestic and
international experience. David started his career working in commercial and
business development roles within the resources sector working for some of
Australia’s most successful gold and nickel exploration and production
companies. During the last 13 years, David has gained international oil and gas
exploration and production sector experience (with a specific focus on the Mid-
Continent region of the United States) working in both executive and non-
executive director roles with Australian publicly traded companies.
David Prentice is currently a Non-Executive Director of Black Mesa Production,
LLC Non-Executive Chairman of Lustrum Minerals Limited (ASX:LRM) and Non-
Executive Director of Comet Resources Limited (ASX:CRL).
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
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DIRECTORS’ REPORT
Richard Homsany Non-Executive Director
Qualifications
Experience
LL.B (Hons), B. Com, Grad. Dip. Fin & Inv, F Fin, MAICD, CPA
Richard is an experienced corporate lawyer and Certified Practising Accountant
(CPA) with significant experience in the resources and energy sectors. He is the
principal of Cardinals Lawyers and Consultants, a West Perth based corporate
and resources law firm. Richard was previously a partner of major law firm DLA
Phillips Fox (now known as global law firm DLA Piper).
Other
Directorships
Loren King
Qualifications
Experience
Richard Homsany is Executive Chairman of ASX listed uranium exploration and
development company Toro Energy Limited (ASX:TOE) and Executive Vice
President, Australia of TSX listed uranium exploration company Mega Uranium Ltd
(TSX:MGA. He is also the Chairman of ASX listed copper exploration company
Redstone Resources Limited (ASX:RDS) and TSX-V listed gold and iron ore explorer
Central Iron Ore Limited (TSX-V:CIO) and of the Health Insurance Fund of Australia
Ltd (ASX:HIF).
Company Secretary
Grad. Dip (Applied Corporate Governance), BSc (Psych), Cert IV FinSvcs
(Bookkeeping)
Loren King has worked in finance and back office administration roles with ASX
listed companies, stockbroking and corporate advisory services for the past 14
years. During this time, she has gained invaluable experience in dealing with all
aspects of corporate governance and compliance, specialising in initial public
offerings
raising and business
development.
listings, private capital
(IPO), backdoor
CORPORATE INFORMATION
Group Corporate Structure
Brookside Energy Limited is a public company incorporated and domiciled in Western Australia listed
on the Australian Securities Exchange (ASX:BRK). Its wholly owned subsidiaries, BRK Oklahoma Holdings
LLC and Anadarko Leasing LLC, are both Limited Liability Companies incorporated and domiciled in
Oklahoma, USA.
Meetings of Directors
The number of Directors' meetings (including committees) held during the year for each director who
held office, and the number of meetings attended by each director are:
Director
Michael Fry
David Prentice
Loren King
Directors Meetings
Meetings Attended
11
11
11
Number Held and Eligible to
Attend
11
11
11
Note: Both David Prentice and Michael Fry attended 12 and 11 Black Mesa Production (BMP) Board
meetings respectively from a total of 12 meetings held for the financial reporting period. The
importance of noting this is that BMP provides the technical and operational inputs for Brookside under
a number of agreements including the Drilling Program Agreement (DPA) and the Acquisition Program
Agreement (APA).
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
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DIRECTORS’ REPORT
Options
At the date of this report 295,140,625 options over ordinary shares in the Group were on issue and no
options were exercised during the year.
As at 31 December 2019, options on issue are as detailed below.
Type
Date of Expiry
Exercise Price
Number on issue
Quoted option
31 Dec 2020
$0.03
295,140,625
Directors’ holdings of shares and options during the financial year have been disclosed in the
Remuneration Report. Option holders do not have any right, by virtue of the option, to participate in
any share issue of the Company.
INDEMNIFYING OFFICERS
In accordance with the constitution, except as may be prohibited by the Corporations Act 2001 (Cth),
every Officer, or agent of the Company shall be indemnified out of the property of the Company
against any liability incurred by them in their capacity as Officer, or agent of the Company or any
related corporation in respect of any act or omission whatsoever and howsoever occurring or in
defending any proceedings, whether civil or criminal.
The Company currently has a Directors’ and Officers’ liability insurance in place. The liabilities insured
are legal costs that may be incurred in defending civil or criminal proceedings that may be brought
against the officers in their capacity as officers of the Company, and any other payments arising from
liabilities incurred by the officers in connection with such proceedings. This does not include such
liabilities that arise from conduct involving a wilful breach of duty by the officers or the improper use
by the officers of their position or of information to gain advantage for themselves or someone else or
to cause detriment to the Company.
PROCEEDINGS ON BEHALF OF COMPANY
No person has applied to the Court for leave to bring proceedings on behalf of the Company or to
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
No non‐audit services were provided by the external auditors during the year ended 31 December
2019.
AUDITOR’S INDEPENDENCE DECLARATION
Section 307C of the Corporations Act 2001 (Cth) requires our auditors, HLB Mann Judd, to provide the
Directors of the Company with an Independence Declaration in relation to the audit of the annual
report. This Independence Declaration is set out on page 17 and forms part of this Directors’ Report
for the year ended 31 December 2019.
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 11
REMUNERATION REPORT (AUDITED)
This Remuneration Report, which forms part of the directors’ report, sets out information about the
remuneration of Brookside Energy Limited’s Directors and its Key Management Personnel for the
financial year ended 31 December 2019.
A.
INTRODUCTION
The information provided in this Remuneration Report has been audited as required by Section
308(3C) of the Corporations Act 2001 (Cth). Information regarding the remuneration of Key
Management Personnel (KMP) is required by Corporations Regulations 2M.3.03. KMP are those
individuals who have the authority and responsibility for planning, directing and controlling the
activities of the Company and the Group
A.1
Brookside’s KMPs
Key Management Personnel for Brookside include the following Directors who were in office during
the financial year:
Name
Michael Fry
David Prentice
Loren King
Category
Non-Executive
Director
Executive
Director
Non-Executive
Director
Position
Independent
Chairman
Managing
Director
Non-Executive
Director
Appointed
Retired
20 April 2004
20 April 2004
-
-
5 June 2015
3 February 2020
A.2 Comments on Remuneration Report at Brookside’s most recent AGM
The Company received a 98.48% (99.11% after Chairman’s discretion) of “yes” votes on its
Remuneration Report for the 2018 financial year. The Company did not receive any specific feedback
from shareholders at the 2018 Annual General Meeting on its remuneration practices.
A.3
Additional information
The profit/(loss) of the group for the five years to 31 December 2019 are summarised below:
Revenue
EBITDA
EBIT
Profit/(loss) after income tax
2019
AU$’000
2,187
1,873
1,520
918
2018
AU$’000
99
(631)
(631)
(1,218)
2017
AU$’000
2
(991)
(1,096)
(1,096)
2016
AU$’000
6
(416)
(410)
(410)
2015
AU$’000
29
(2,248)
(2,240)
(2,240)
The factors that are considered to affect total shareholders return (TSR) are summarised below:
Share price at financial year end (AUD)
Total dividends declared (cents per share)
Basic earnings/(loss) per share (cents per
share)
2019
0.009
-
2018
0.011
-
2017
0.01
-
2016
0.01
-
2015
0.01
-
0.09
(0.13)
(0.14)
(0.20)
(2.13)
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 12
REMUNERATION REPORT (AUDITED)
B.
REMUNERATION POLICY DURING THE REPORTING PERIOD
The Brookside Board is committed to transparent disclosure of its remuneration strategy and this report
details the Company’s remuneration objectives, practices and outcomes for KMP, which includes
Directors and senior executives, for the period ended 31 December 2019. Any reference to
“Executives” in this report refers to KMPs who are not Non-Executive Directors.
B.1
Remuneration Policy Framework
The key objective of Brookside’s remuneration policy is to be a key enabler for the Company in
achieving its strategic goal of continuing to build a successful oil and gas exploration and production
company. It has been designed to reward executives and employees fairly and responsibly in
accordance with the regional and international market in which the Company operates, and to
ensure that Brookside:
• Provides competitive rewards that attract, retain and motivate executives and employees of
the highest calibre, who can successfully deliver, particularly as the Company moves through
the current phase of rapidly increased development and production;
Sets demanding levels of expected performance that have a clear linkage to an executive’s
remuneration;
•
• Benchmarks remuneration against appropriate comparator peer groups to make the
Company competitive in a tight skilled human resources market, through an offering of both
short- and long-term incentives and competitive base salaries.;
• Provides a level of remuneration structure to reflect each executive’s respective duties and
responsibilities;
• Aligns executive incentive rewards with the creation of value for shareholders;
• Complies with legal requirements and appropriate standards of governance.
B.2
Policy for Executive Remuneration for Future Reporting Periods
Executive Remuneration consists of the following key elements:
Fixed remuneration or base salaries; and
•
• Variable remuneration, being the “at risk” component related to performance comprising;
o Short Term Incentives (STI); and
o Long Term Incentive (LTI).
C.
REMUNERATION COMPONENTS
C.1
Fixed Remuneration
Fixed remuneration was reviewed by the Remuneration and Nomination Committee in 2018 and
remained consistent for the current reporting period.
C.2
STI Plan for the 2019 Reporting Period
No STI plan was implemented for the 2019 reporting period.
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
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REMUNERATION REPORT (AUDITED)
C.3
Policy for and Components of Non-Executive Remuneration During the Reporting Period
Remuneration Policy
Non-Executive Director Fees
The overall level of annual Non-Executive Director fees was approved by shareholders in accordance
with the requirements of the Company’s Constitution and the Corporations Act. The maximum
aggregate Directors’ fees payable to all of the Company’s Non-Executive Directors is $500,000 per
annum. This aggregate amount was approved by shareholders at the 2012 Annual General Meeting.
Equity Compensation
In accordance with Australian practice and shareholder preference, the Company’s current policy is
not to grant equity-based compensation to Non-Executive Directors. Accordingly, no equity
components (LTI Rights) were offered to Non-Executive Directors in the reporting period to 31
December 2019.
Remuneration Structure
Non-Executive Directors receive a fixed remuneration of base fees plus statutory superannuation. In
addition, and in recognition of the higher workloads and extra responsibilities of participating on a
Board committee, if applicable, they also received a committee fee and chairing a committee also
warrants a higher fee. In addition to these fees, Non-Executive Directors are entitled to reimbursement
of reasonable travel, accommodation and other expenses incurred in attending meetings of the
Board, committee or shareholder meetings whilst engaged by Brookside. Non-Executive Directors do
not earn retirement benefits other than superannuation and are not entitled to any compensation on
termination of their directorships.
D.
DETAILS OF REMUNERATION
Remuneration of Key Management Personnel is set out below:
Primary
Post- employment
Base Salary
and Fees
$
Bonus
STI
$
Share-
based
Benefits
$
Super-
annuation
Contributions
$
Termination
Payments
$
TOTAL
$
Percentage
Performance
Related
%
31 December 2019
Executive Directors
David Prentice
180,000
Non-Executive Directors
Michael Fry
Loren King(i)(ii)
Total 31 Dec 2019
50,000
30,000
260,000
-
-
-
-
-
-
-
-
-
-
-
-
-
180,000
-
-
-
50,000
30,000
260,000
-
-
-
-
(i) Retired 3 February 2020
(ii) During the year ended 31 December 2019, Cicero Group Pty Ltd, an entity related to Loren King, received $114,000 (2018:
$114,000) exclusive of GST for the provision of company secretarial and accounting work to the Company. Cicero has been
engaged to provide corporate services to the Group.
As at 31 December 2019, the Company had accrued $19,166 in outstanding director fees (31
December 2018: $19,166).
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 14
REMUNERATION REPORT (AUDITED)
Primary
Post- employment
Base Salary
and Fees
$
Bonus
STI
$
Non-
Monetary
Benefits
$
Super-
annuation
Contributions
$
Termination
Payments
$
TOTAL
$
Percentage
Performance
Related
%
31 December 2018
Executive Directors
David Prentice
180,000
Non-Executive Directors
Michael Fry
Loren King(i)(ii)
Total
50,000
30,000
260,000
-
-
-
-
-
-
-
-
-
-
-
-
-
180,000
-
-
-
50,000
30,000
260,000
-
-
-
(i) Retired 3 February 2020
(ii) During the year ended 31 December 2019, Cicero Group Pty Ltd, an entity related to Loren King, received $114,000 (2018:
$114,000) exclusive of GST for the provision of company secretarial and accounting work to the Company. Cicero has been
engaged to provide corporate services to the Group
E. ADDITIONAL DISCLOSURES RELATING TO KEY MANAGEMENT PERSONNEL
E.1
Shares held by Key Management Personnel
The number of shares in the Company held during year by each Director of Brookside Energy Limited
and other Key Management Personnel, including their personally related parties, are set out below.
There were no shares granted during the year as compensation.
Director
David Prentice
Michael Fry
Loren King(ii)
Total
Balance at
1 Jan 2019
Shares
Issued
Other(i)
Balance at
31 Dec 2019
2,247,272
4,000,000
-
6,247,272
-
-
-
-
952,728
-
-
3,200,000
4,000,000
-
952,728
7,200,000
(i) Shares acquired on market.
(ii) Retired 3 February 2020.
Since 31 December 2019, Michael Fry and David Prentice have acquired 1,500,000 and 6,425,596 fully
paid ordinary shares, respectively.
E.2
Options Held by Key Management Personnel
Options held by Key Management Personnel during the reporting period are as follows:
Director
David Prentice
Michael Fry
Loren King(i)
Total
(i) Retired 3 February 2020.
Balance at
1 Jan 2019
Options
Issued
Other
Balance at
31 Dec 2019
15,000,000
10,000,000
-
25,000,000
-
-
-
-
-
-
-
-
15,000,000
10,000,000
-
25,000,000
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 15
REMUNERATION REPORT (AUDITED)
E.3
Loans to Key Management Personnel
No loans were made to key management personnel of the Company during the financial year or the
prior corresponding period.
E.4
Other Transactions and Balances with Key Management Personnel
Other than as stated above, there have been no other transactions with key management personnel
during the year.
E.5
Compensation Options: Granted and vested during and since the financial year ended 31
December 2019
During the financial year ended 31 December 2019 (2018: Nil), no compensation options were granted
or vested to directors.
E.6
Performance income as a proportion of total income
No performance-based bonuses have been paid to key management personnel during the financial
year.
F.
SERVICE AGREEMENTS
Director
Base Salary
Terms of the Agreement
Notice Period
$15,000 per month
Until termination
6 Months
David Prentice
CEO/Managing Director
Michael Fry
Non-Executive Chairman
$50,000 per annum
Loren King(ii)
Non-Executive Director
$30,000 per annum
Director of Cicero Group
Pty Ltd
$114,000 per annum for the
provision of company
secretarial and office support
ii)Appointed 3 February 2020.
(ii) Retired 3 February 2020.
Until termination in
accordance with the
Company’s Constitution
Until termination in
accordance with the
Company’s Constitution
Reasonable
notice
Reasonable
notice
Until termination
6 Months
- - END OF REMUNERATION REPORT - -
This report is made in accordance with a resolution of the Directors.
David Prentice
Chief Executive Officer
31 March 2020
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 16
AUDITOR’S INDEPENDENCE DECLARATION
As lead auditor for the audit of the consolidated financial report of Brookside Energy Limited for the
year ended 31 December 2019, I declare that, to the best of my knowledge and belief, there have
been no contraventions of:
(a)
the auditor independence requirements as set out in the Corporations Act 2001 in relation to
the audit; and
(b)
any applicable code of professional conduct in relation to the audit.
Perth, Western Australia
31 March 2020
N G Neill
Partner
Page 17
CORPORATE GOVERNANCE STATEMENT
Brookside Energy Limited (Company) and the Board of Directors are committed to achieving the
highest standards of corporate governance. The Board continues to review the framework and
practices to ensure they meet the interests of shareholders. The Company and its controlled entities
together are referred to as the Group in this statement.
A description of the Group’s main corporate governance practices is set out on the Company’s
website http://brookside-energy.com.au/corporate-governance.
All these practices, unless otherwise stated, were in place for the entire period and comply with the
ASX Corporate Governance Principles and Recommendations and are contained
in the
accompanying Appendix 4G for the period ended 31 December 2019.
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 18
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER
COMPREHENSIVE INCOME
For the financial year ended 31 December 2019
Royalty revenue
Production expense
Gross profit
Interest revenue
Gain on sale of asset
Other expenses
Director and employee related expenses
Consultants fees
Compliance and registry expenses
Share based payments expense
Interest on financing
Amortisation expense
Fair value loss on equity investment
(Loss)/gain on foreign exchange movement
Profit/(loss) before income tax expense
Notes
For the year
ended
31 Dec 2019
$
For the year
ended
31 Dec 2018
$
2.A
2.A
2.A
2.B
2,187,313
(459,427)
1,727,886
102
1,076,763
(228,941)
(260,000)
(19,535)
(257,343)
(52,800)
(602,160)
(353,255)
(97,500)
(15,714)
98,000
-
98,000
1,183
810,804
(329,917)
(260,000)
(87,205)
(173,332)
(346,242)
(586,666)
-
-
(344,405)
917,503
(1,217,780)
Income tax expense
Net profit/(loss) for the year
3
-
917,503
-
(1,217,780)
Other comprehensive income
Items that may be reclassified subsequently to profit
and loss:
Exchange differences on the translation of foreign
operations
Other comprehensive profit/(loss) for the year net of
taxes
Total comprehensive profit/(loss) for the year
64,688
1,117,179
982,191
(100,601)
982,191
(100,601)
Earnings/(loss) Per Share
Basic and diluted earnings/(loss) per share (cents)
16
0.09
(0.13)
The accompanying notes form part of these consolidated financial statements.
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 19
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 31 December 2019
Assets
Current Assets
Cash and cash equivalents
Trade and other receivables
Total Current Assets
Non-Current Assets
Other assets
Exploration and evaluation assets
Production assets
Financial assets fair value through profit and loss
Total Non-Current Assets
Total Assets
Liabilities
Current Liabilities
Trade and other payables
Borrowings
Total Current Liabilities
Total Liabilities
Net Assets
Equity
Issued capital
Reserves
Accumulated losses
Total Equity
As at
31 Dec 2019
$
As at
31 Dec 2018
$
Notes
4
5
6
7
8
9.A
9.B
10
12
11
1,056,179
466,684
1,522,863
1,193,306
24,337
1,217,643
1,336,964
10,832,623
575,962
52,500
12,798,049
14,320,912
972,484
10,392,000
-
-
11,364,484
12,582,127
47,617
5,362,785
5,410,402
5,410,402
8,910,510
71,751
4,644,838
4,716,589
4,716,589
7,865,538
225,407,357
3,803,585
(220,300,432)
8,910,510
225,354,557
3,728,916
(221,217,935)
7,865,538
The accompanying notes form part of these consolidated financial statements.
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 20
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 31 December 2019
Balance at 1 January 2018
Profit/(loss) for the period
Other comprehensive income/(loss)
Total comprehensive income/(loss) for the period
Shares issued during the period
Shares issued in lieu of services
Options issued during the period
Capital raising costs
Balance at 31 December 2018
Balance at 1 January 2019
Profit/(loss) for the period
Other comprehensive income/(loss)
Total comprehensive income/(loss) for the period
Shares issued in lieu of services
Options issued during the period
Foreign exchange
Balance at 31 December 2019
Issued
Capital
$
Accumulated
Losses
$
222,355,544
-
-
-
3,160,000
108,350
-
(269,337)
225,354,557
225,354,557
-
-
-
52,800
-
-
225,407,357
(220,000,155)
(1,217,780)
-
(1,217,780)
-
-
-
-
(221,217,935)
(221,217,935)
917,503
-
917,503
-
-
-
(220,300,432)
Share
Based
Payment
Reserve
$
Foreign
Currency
Translation
Reserve
$
2,618,222
-
-
-
-
-
284,642
-
2,902,864
2,902,864
-
-
-
-
9,981
-
2,912,845
(291,127)
-
1,117,179
1,117,179
-
-
-
-
826,052
826,052
-
-
-
-
-
64,688
890,740
Total
$
4,682,484
(1,217,780)
1,117,179
(100,601)
3,160,000
108,350
284,642
(269,337)
7,865,538
7,865,538
917,503
-
917,503
52,800
9,981
64,688
8,910,510
The accompanying notes form part of these consolidated financial statements.
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 21
CONSOLIDATED STATEMENT OF CASH FLOWS
For the year ended 31 December 2019
For the year
ended
31 Dec 2019
$
For the year
ended
31 Dec 2018
$
Notes
Cash Flows Used in Operating Activities
Receipts from Customers
Payments to suppliers and employees
Interest received
Net Cash Provided By/(Used In) Operating Activities
Cash Flows from Investing Activities
Proceeds from disposal of assets
Payments for assets
Payments for acquisition of oil and gas properties
Payments for production assets
Net Cash (Used In) Investing Activities
Cash Flows from Financing Activities
Proceeds from issue of shares
Transaction costs on issue of shares
Proceeds from issue of options
Proceeds from borrowings
Repayment of borrowings
Net Cash Provided by Financing Activities
Net Increase/(Decrease) in Cash and Cash Equivalents
Cash at beginning of the period
Effect of exchange rates on cash
Cash at End of Period
13
9.B
9.B
13
1,735,348
(1,244,252)
93
491,189
3,072,518
(512,460)
(1,927,127)
(1,381,027)
(748,096)
-
-
9,981
200,000
(100,000)
109,981
(146,926)
1,193,306
9,799
1,056,179
98,000
(850,534)
1,183
(751,351)
2,077,114
-
(3,988,879)
-
(1,911,765)
3,155,655
(241,560)
-
743,519
-
3,657,614
994,498
51,854
146,954
1,193,306
The accompanying notes form part of these consolidated financial statements.
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 22
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
1.A.
BASIS OF PREPARATION
These financial statements are general purpose financial statements, which have been prepared in
accordance with the requirements of the Corporations Act 2001, Accounting Standards and
Interpretations and comply with other requirements of the law.
The financial statements comprise the consolidated financial statements for the Group. For the
purposes of preparing the consolidated financial statements, the Company is a for-profit entity.
The accounting policies detailed below have been consistently applied to all of the years presented
unless otherwise stated. The financial statements are for the Group consisting of Brookside Energy
Limited and its subsidiaries.
The financial statements have been prepared on a historical cost basis. Historical cost is based on the
fair values of the consideration given in exchange for goods and services.
The Company is an ASX listed public company, incorporated in Australia and operating in Australia
and the USA. The Group’s principal activities during the year were the exploration and appraisal of oil
and gas projects.
The financial report is presented in Australian dollars.
1.A.1. Functional and Presentation Currency
The consolidated financial statements are presented in Australian dollars (AU$), which is the Group’s
presentation currency unless otherwise stated.
1.A.2. Accounting Policies
The same accounting policies and methods of computation have been followed in this consolidated
financial report as were applied in the 31 December 2018 financial statements except for the impact
of the new and revised standards and interpretations as outlined in Note 1.B.
1.A.3. Going Concern
The Group produced a profit of $917,503 for the year ended 31 December 2019. In addition, the Group
has a working capital deficit of ($3,887,539). Cash and cash equivalents at the year-end amounted
to $1,056,179.
The ability of the Company and Group to continue as going concerns is dependent on a combination
of a number of factors, the most significant of which is the ability of the Company to raise additional
funds in the following 12 months through issuing additional shares and/or, to secure further financing
facilities or extend the current financing facilities in place, which are due to be repaid on 31 December
2019.
These factors indicate a material uncertainty exists, that may cast significant doubt as to whether the
Company and Group will continue as going concerns and therefore whether they will realise their
assets and extinguish their liabilities in the normal course of business and at the amounts stated in the
financial report.
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 23
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
1.B.
ADOPTION OF NEW AND REVISED STANDARDS
1.B.1.
Changes in accounting policies on initial application of Accounting Standards
Standards and Interpretations applicable to 31 December 2019
In the year ended 31 December 2019, the Directors have reviewed all of the new and revised
Standards and Interpretations issued by the AASB that are relevant to the Company and effective for
the year reporting periods beginning on or after 1 January 2019.
As a result of this review, the Directors have determined that there is no material impact of the new
and revised Standards and Interpretations on the Company and therefore no material change is
necessary to Group accounting policies.
AASB 16 Leases
AASB 16 replaces AASB 117 Leases. AASB 16 removes the classification of leases as either operating
leases of finance leases-for the lessee – effectively treating all leases as finance leases.
AASB 16 is applicable to annual reporting periods beginning on or after 1 January 2019.
Impact on operating leases
AASB 16 changes how the Group accounts for leases previously classified as operating leases under
AASB 117, which were off-balance sheet.
Lease incentives (e.g. rent-free period) are recognised as part of the measurement of the right-of-use
assets and lease liabilities whereas under AASB 117 they resulted in the recognition of a lease liability
incentive, amortised as a reduction of rental expenses on a straight-line basis.
Under AASB 16, right-of-use assets are tested for impairment in accordance with AASB 136 Impairment
of Assets. This will replace the previous requirement to recognise a provision for onerous lease
contracts.
For short-term leases (lease term of 12 months or less) and leases of low-value assets (such as personal
computers and office furniture), the Group will opt to recognise a lease expense on a straight-line
basis as permitted by AASB 16.
The Group has conducted an assessment of the impact of the new standard and determined that
there is no material impact due to the group not entering into any lease agreements that are covered
by the standard.
Standards and Interpretations in issue not yet adopted applicable to 31 December 2019
The Directors have also reviewed all of the new and revised Standards and Interpretations in issue not
yet adopted that are relevant to the Company and effective for the year reporting periods beginning
on or after 1 January 2020.
As a result of this review, the Directors have determined that there is no material impact of the new
and revised Standards and Interpretations in issue not yet adopted on the Company and therefore
no material change is necessary to Group accounting policies.
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 24
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
1.C.
STATEMENT OF COMPLIANCE
The general purpose consolidated financial statements for the period ended 31 December 2019 were
approved and authorised for issue on 31 March 2020.
The financial report complies with Australian Accounting Standards, which include Australian
equivalents to International Financial Reporting Standards (AIFRS). Compliance with AIFRS ensures that
the financial report, comprising the financial statements and notes thereto, complies with International
Financial Reporting Standards (IFRS).
1.D.
BASIS OF CONSOLIDATION
The consolidated financial statements comprise the financial statements of Brookside Energy Limited
and its subsidiaries as at 31 December each year (the Group). Control is achieved where the company
has the power to govern the financial and operating policies of an entity so as to obtain benefits from
its activities.
The financial statements of the subsidiaries are prepared for the same reporting period as the parent
company, using consistent accounting policies. Investments in subsidiaries are accounted for at cost
in the parent entity’s financial statements.
In preparing the consolidated financial statements, all intercompany balances and transactions,
income and expenses and profit and losses resulting from intra-group transactions have been
eliminated in full. Subsidiaries are fully consolidated from the date on which control is transferred to
the Group and cease to be consolidated from the date on which control is transferred out of the
Group. Control exists where the company has the power to govern the financial and operating
policies of an entity so as to obtain benefits from its activities.
The acquisition of subsidiaries has been accounted for using the purchase method of accounting. The
purchase method of accounting involves allocating the cost of the business combination to the fair
value of the assets acquired, and the liabilities and contingent liabilities assumed at the date of
acquisition. Accordingly, the consolidated financial statements include the results of subsidiaries for
the period from their acquisition.
1.E.
SIGNIFICANT ACCOUNTING ESTIMATES AND JUDGEMENTS
The application of accounting policies requires the use of judgements, estimates and assumptions
about carrying values of assets and liabilities that are not readily apparent from other sources. The
estimates and associated assumptions are based on historical experience and other factors that are
considered to be relevant. Actual results may differ from these estimates.
Exploration and evaluation expenditure
The Directors have conducted a review of the Group’s capitalised exploration expenditure to
determine the existence of any indicators of impairment. Based upon this review, the Directors have
determined that no impairment exists.
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 25
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1.E.
SIGNIFICANT ACCOUNTING ESTIMATES AND JUDGEMENTS (continued)
Share-based payment transactions
The Group measures the cost of equity-settled transactions with employees by reference to the fair
value of the equity instruments at the date at which they are granted. The fair value is determined by
an external valuer using a Black and Scholes model, using assumptions provided by the Company.
The fair value is expensed over the period until vesting.
1.F.
REVENUE
The Company currently generates revenue from its revenue interests in production projects. Revenue is measured
at the fair value of the consideration received or receivable. Revenue is reduced for estimated customer returns,
rebates and other similar allowances.
Sale of oil and gas
Revenue is recognised when the Company is notified of its proportionate share from operators of each
production asset project.
Interest income
Interest revenue is recognised on a time proportionate basis that takes into account the effective yield on the
financial asset.
1.G.
FOREIGN CURRENCY TRANSLATION
Both the functional and presentation currency of Brookside Energy Limited is Australian dollars. Each
entity in the Group determines its own functional currency and items included in the financial
statements of each entity are measured using that functional currency.
Transactions in foreign currencies are initially recorded in the functional currency by applying the
exchange rates ruling at the date of the transaction. Monetary assets and liabilities denominated in
foreign currencies are retranslated at the rate of exchange ruling at the balance date.
All exchange differences in the consolidated financial statements are taken to profit or loss with the
exception of differences on foreign currency borrowings that provide a hedge against a net
investment in a foreign entity. These are taken directly to equity until the disposal of the net investment,
at which time they are recognised in profit or loss.
Tax charges and credits attributable to exchange differences on those borrowings are also recognised
in equity. Non-monetary items that are measured in terms of historical cost in a foreign currency are
translated using the exchange rate as at the date of the initial transaction.
Non-monetary items measured at fair value in a foreign currency are translated using the exchange
rates at the date when the fair value was determined. Translation differences on assets and liabilities
carried at fair value are reported as part of the fair value gain or loss.
The functional currency of the foreign operations, BRK Oklahoma Holdings LLC and Anadarko Leasing
LLC is US dollars, “USD”.
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 26
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1.H.
PRODUCING ASSETS
Producing assets represent the accumulation of all exploration, evaluation and development
expenditure incurred in respect of areas of interest in which drilling has commenced or in the process
of commencing. When further development expenditure is incurred in respect of operating wells after
the commencement of production, such expenditure is carried forward as part of the producing asset
only when substantial future economic benefits are thereby established, otherwise such expenditure
is classified as part of the cost of production.
Amortisation is provided on a unit of production basis which results in a write off of the cost proportional
to the depletion of the proven and probably oil reserves.
The net carrying value of each area of interest is reviewed regularly and to the extent to which this
value exceeds its recoverable amount, the excess is either fully provided against or written off in the
financial year in which this is determined.
2.
REVENUES AND EXPENSES
2.A.
REVENUE
Royalty revenue (point in time)
Interest received
Gain on sale of investment
Year ended
31 Dec 2019
$
2,187,313
102
1,076,763
3,264,178
Year ended
31 Dec 2018
$
98,000
1,183
810,804
909,987
Revenue is measured at fair value of the consideration received or receivable. Amounts disclosed as
revenue are net of returns, trade allowances, rebates and amounts collected on behalf of third
parties. All revenue is measured at the point in time.
Interest income
Interest income from a financial asset is recognised when it is probable that the economic benefits
will flow to the Group and the amount of revenue can be reliably measured. Interest income is
accrued on a time basis, by reference to the principal outstanding and at the effective interest rate
applicable, which is the rate that exactly discounts estimated future cash receipts through the
expected life of the financial asset to that asset’s net carrying amount on initial recognition.
2.B. OTHER EXPENSES
Administration expenses
Promotion and communication costs
Travel expenses
Year ended
31 Dec 2019
$
Year ended
31 Dec 2018
$
94,052
-
134,889
228,941
95,766
56,555
177,596
329,917
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 27
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
3.
INCOME TAX EXPENSE
The components of tax expense comprise:
Current tax
Deferred tax
Income tax expense reported in statement of profit or loss
and other comprehensive income
Prima facie tax expense/(benefit) on profit/(loss) from ordinary
activities before income tax at 30% (2018: 30%)
Add tax effect of:
Non-allowable items
Losses not recognised
Impact of different tax rate (USA)
Less tax effect of:
Other deductable items
Losses deferred tax balances not recognised
3.A.
UNRECOGNISED DEFERRED TAX LIABILITY
Other deferred tax liabilities
Less: Deferred tax assets recognised (tax losses)
3.B.
UNRECOGNISED DEFERRED TAX ASSETS
Unrecognised deferred tax assets at 30% (31 December 2018:
27.5%):
Carry forward revenue losses
Provisions and accruals
Capital raising
Less: Deferred tax liabilities
Year ended
31 Dec 2019
$
Year ended
31 Dec 2018
$
-
-
-
-
-
-
277,333
(457,539)
57,192
(278,840)
(55,685)
Year ended
31 Dec 2019
$
-
-
-
-
384,663
23,754
49,122
-
Year ended
31 Dec 2018
$
-
-
-
Year ended
31 Dec 2019
$
Year ended
31 Dec 2018
$
2,445
(2,445)
-
5,113
(5,113)
-
Year ended
31 Dec 2019
$
Year ended
31 Dec 2018
$
3,486,174
35,250
89,353
(2,445)
3,608,332
4,418,594
6,000
119,102
(5,113)
4,538,583
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 28
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
3.
INCOME TAX EXPENSE (continued)
The tax benefits of the above deferred tax assets will only be obtained if:
(a)
the company derives future assessable income of a nature and of an amount sufficient to
enable the benefits to be utilised;
the company continues to comply with the conditions for deductibility imposed by law; and
(b)
(c) no changes in income tax legislation adversely affect the company in utilising the benefits.
Current tax assets and liabilities for the current and prior periods are measured at the amount
expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to
compute the amount are those that are enacted or substantively enacted by the balance date.
Deferred income tax is provided on all temporary differences at the statement of financial position
date between the tax bases of assets and liabilities and their carrying amounts for financial reporting
purposes.
Deferred income tax assets are recognised for all deductible temporary differences, carry-forward of
unused tax assets and unused tax losses, to the extent that it is probable that taxable profit will be
available against which the deductible temporary differences and the carry-forward of unused tax
credits and unused tax losses can be utilised, except:
• when the deferred income tax asset relating to the deductible temporary difference arises
from the initial recognition of an asset or liability in a transaction that is not a business
combination and, at the time of the transaction, affects neither the accounting profit nor
taxable profit or loss; or
• when the deductible temporary difference is associated with investments in subsidiaries,
associates or interests in joint ventures, in which case a deferred tax asset is only recognised to
the extent that it is probable that the temporary difference will reverse in the foreseeable future
and taxable profit will be available against which the temporary difference can be utilised.
The carrying amount of deferred income tax assets is reviewed at each balance date and reduced
to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or
part of the deferred income tax asset to be utilised.
Unrecognised deferred income tax assets are reassessed at each balance date and are recognised
to the extent that it has become probable that future taxable profit will allow the deferred tax asset
to be recovered.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to
the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have
been enacted or substantively enacted at the balance date. Income taxes relating to items
recognised directly in equity are recognised in equity and not in profit or loss.
Deferred tax assets and deferred tax liabilities are offset only if a legally enforceable right exists to set
off current tax assets against current tax liabilities and the deferred tax assets and liabilities relate to
the same taxable entity and the same taxation authority.
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 29
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
3.
INCOME TAX EXPENSE (continued)
Other taxes
Revenues, expenses and assets are recognised net of the amount of GST except:
• when the GST incurred on a purchase of goods and services is not recoverable from the
taxation authority, in which case the GST is recognised as part of the cost of acquisition of the
asset or as part of the expense item as applicable; and
receivables and payables, which are stated with the amount of GST included.
•
The net amount of GST recoverable from, or payable to, the taxation authority is included as part of
receivables or payables in the statement of financial position.
Cash flows are included in the Statement of Cash Flows on a gross basis and the GST component of
cash flows arising from investing and financing activities, which is recoverable from, or payable to, the
taxation authority are classified as operating cash flows.
Commitments and contingencies are disclosed net of the amount of GST recoverable from, or
payable to, the taxation authority.
4.
CASH AND CASH EQUIVALENTS
Cash at bank
As at
31 Dec 2019
$
1,056,179
1,056,179
As at
31 Dec 2018
$
1,193,306
1,193,306
Cash comprises cash at bank and in hand. Cash equivalents are short term, highly liquid investments
that are readily convertible to known amounts of cash and which are subject to an insignificant risk of
changes in value.
For the purposes of the Statement of Cash Flows, cash and cash equivalents consist of cash and cash
equivalents as defined above, net of outstanding bank overdrafts. Cash at bank earns interest at
floating rates based on daily bank deposit rates.
5.
TRADE & OTHER RECEIVABLES
Current
Other receivables
Prepayments
As at
31 Dec 2019
$
As at
31 Dec 2018
$
444,294
22,390
466,684
7,295
17,042
24,337
Trade receivables are generally due for settlement within periods ranging from 15 days to 30 days.
There are no receivables that are past due date.
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 30
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
5.
TRADE & OTHER RECEIVABLES (continued)
The Group applies the AASB 9 simplified model of recognising lifetime expected credit losses for all
trade receivables as these items do not have a significant financing component.
In measuring the expected credit losses, the trade receivables have been assessed on a collective
basis as they possess shared credit risk characteristics. They have been grouped based on the days
past due and also according to the geographical location of customers.
The expected loss rates are based on the payment profile for sales over the past 48 months before 31
December 2019 and 31 December 2018 respectively as well as the corresponding historical credit
losses during that period. The historical rates are adjusted to reflect current and forwarding looking
macroeconomic factors affecting the customer’s ability to settle the amount outstanding.
The group has identified gross domestic product (GDP) of the countries in which the customers are
domiciled to be the most relevant factors and accordingly adjusts historical loss rates for expected
changes in these factors. However given the short period exposed to credit risk, the impact of these
macroeconomic factors has not been considered significant within the reporting period.
Trade receivables are written off when there is no reasonable expectation of recovery. Failure to make
payments within 180 days from the invoice date and failure to engage with the Group on alternative
payment arrangement amongst other is considered indicators of no reasonable expectation of
recovery.
6.
OTHER ASSETS
At cost
6.A. MOVEMENT IN CARRYING AMOUNTS
Opening balance
Black Mesa Productions LLC - Earn In
Foreign currency translation
Disposal of RA Minerals - at cost
Closing balance
As at
31 Dec 2019
$
1,336,964
1,336,964
As at
31 Dec 2018
$
972,484
972,484
Year ended
31 Dec 2019
$
Year ended
31 Dec 2018
$
972,484
360,325
4,155
-
1,336,964
1,994,614
-
154,981
(1,177,111)
972,484
The recognition of costs carried forward in relation to the Earn In arrangement with Black Mesa are
dependent on the successful development and commercial exploration or sale of exploration
interests.
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 31
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
6. OTHER ASSETS (continued)
6.A. MOVEMENT IN CARRYING AMOUNTS
During the year ended 31 December 2019, as per the agreement between Black Mesa Productions,
LLC, and BRK, BRK paid the balance of US$253,020.
Investment in Subsidiary
Subsidiary
BRK Oklahoma Holdings, LLC.
Anadarko Leasing, LLC.
2019
%
100
100
2018
%
100
100
2019
$
366
444
2018
$
366
444
7.
EXPLORATION AND EVALUATION
Costs carried forward in respect of areas of interest in:
Exploration and evaluation phases – at cost
Opening Balance
Anadarko Basin Projects (leasehold acquisition)
Reclassification as producing assets
Sale of acreage
Foreign currency translation on movement
As at
31 Dec 2019
$
As at
31 Dec 2018
$
10,832,623
10,392,000
10,392,000
1,908,191
(303,567)
(1,237,590)
73,589
10,832,623
5,993,514
4,849,094
-
-
(450,608)
10,392,000
The recoupment of costs carried forward in relation to areas of interest in the exploration and
evaluation phases are dependent on the successful development and commercial exploitation or
sale of the respective areas.
Exploration and evaluation expenditures in relation to each separate area of interest are recognised
as an exploration and evaluation asset in the year in which they are incurred where the following
conditions are satisfied:
the rights to tenure of the area of interest are current; and
-
- at least one of the following conditions is also met:
o
the exploration and evaluation expenditures are expected to be recouped through
successful development and exploitation of the area of interest, or alternatively, by its
sale; or
o exploration and evaluation activities in the area of interest have not at the balance
date reached a stage which permits a reasonable assessment of the existence or
otherwise of economically recoverable reserves, and active and significant operations
in, or in relation to, the area of interest are continuing.
Exploration and evaluation assets are initially measured at cost and include acquisition of rights to
explore, studies, exploratory drilling, trenching and sampling and associated activities and an
allocation of depreciation and amortised of assets used in exploration and evaluation activities.
General and administrative costs are only included in the measurement of exploration and evaluation
costs where they are related directly to operational activities in a particular area of interest.
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 32
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
7.
EXPLORATION AND EVALUATION (continued)
Exploration and evaluation assets are assessed for impairment when facts and circumstances suggest
that the carrying amount of an exploration and evaluation asset may exceed its recoverable amount.
The recoverable amount of the exploration and evaluation asset (for the cash generating unit(s) to
which it has been allocated being no larger than the relevant area of interest) is estimated to
determine the extent of the impairment loss (if any). Where an impairment loss subsequently reverses,
the carrying amount of the asset is increased to the revised estimate of its recoverable amount, but
only to the extent that the increased carrying amount does not exceed the carrying amount that
would have been determined had no impairment loss been recognised for the asset in previous years.
Where a decision has been made to proceed with development in respect of a particular area of
interest, the relevant exploration and evaluation asset is tested for impairment and the balance is then
reclassified to development.
8.
PRODUCING ASSETS
Balance at beginning of period
Reclassification from exploration and evaluation phase
Add: capitalisation of production expense
Less: sale of working interest
Less: amortisation
Foreign currency translation on movement
As at
31 Dec 2019
$
As at
31 Dec 2018
$
-
303,567
1,367,435
(746,665)
(353,255)
4,880
575,962
-
-
-
-
-
-
-
Producing assets were transferred from exploration and evaluation phase on 1 January 2019.
Estimates and judgements
Assumptions used to carry forward the producing assets
During the year ended 31 December 2019, no producing assets were assessed as impaired.
The estimation of reserves requires significant management judgement and interpretation of complex
geological and geophysical models in order to make an assessment of the size, share, depth and
quality of reservoirs and their anticipated recoveries. Estimates have been used to determine the fair
value of the oil and gas properties for the purpose of the assessment of depletion and amortisation
charges.
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 33
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
9.
LIABILITIES
9.A.
TRADE AND OTHER PAYABLES
Trade creditors (a)
Other creditors and accruals*
*Aggregate amounts payable to related parties included:
Directors and director-related entities
Terms and conditions
As at
31 Dec 2019
$
As at
31 Dec 2018
$
8,449
39,168
47,617
32,585
39,166
71,751
19,166
19,166
(a)
Trade creditors are non-interest bearing and are normally settled on 30-day terms.
Trade payables and other payables are carried at amortised cost and represent liabilities for goods
and services provided to the Group prior to the end of the financial year that are unpaid and arise
when the Group becomes obliged to make future payments in respect of the purchase of these
goods and services. Trade and other payables are presented as current liabilities unless payment is
not due within 12 months.
9.B.
BORROWINGS
Opening balance
Oklahoma Energy LLC financing
Repayments
Interest accrued on borrowings
Foreign Currency Translation
Closing balance
Year ended
31 Dec 2019
$
4,644,838
200,000
(100,000)
602,160
15,787
5,362,785
Year ended
31 Dec 2018
$
3,022,744
743,519
-
586,666
291,909
4,644,838
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 34
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
9.B.
BORROWINGS (continued)
Terms of the Drawdown Facility are as follows:
Date of
Agreement
Financing
Facility
1 June 2017
(Amended 22
December
2017, 16 March
2018 and 31
October 2019)
US$4,000,000
(increase
from
$2,000,000 on
22 December
2017)
Terms(i)
Facility is due for repayment on the 31 December 2020. Facility
shall bear interest at a rate per annum of 12%, payable quarterly
in arrears on drawdown amounts.
Facility will be secured by the Borrower’s interest in Working
Interest leasehold acreage that is acquired by the Borrower
pursuant to and subject to the terms of the Drilling Program
Agreement between the Borrower and Black Mesa Production,
LLC.
(i) On 16 March 2018 and 31 October 2019, the terms of the facility agreement were amended. Refer Note 22.
As at 31 December 2019, a total of AU$4,112,459 (US$2,887,768) has been drawn down. Included
within the profit and loss statement is $602,160 interest expense for the period.
Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are
subsequently measured at amortised cost. Any difference between the proceeds (net of transaction
costs) and the redemption amount is recognised in profit or loss over the period of the borrowings
using the effective interest method. Fees paid on the establishment of loan facilities are recognised
as transaction costs of the loan to the extent that it is probable that some or all of the facility will be
drawn down. In this case, the fee is deferred until the draw down occurs. To the extent there is no
evidence that it is probable that some or all of the facility will be drawn down, the fee is capitalised
as a prepayment for liquidity services and amortised over the period of the facility to which it relates.
Borrowings are removed from the statement of financial position when the obligation specified in the
contract is discharged, cancelled or expired. The difference between the carrying amount of a
financial liability that has been extinguished or transferred to another party and the consideration
paid, including any non-cash assets transferred or liabilities assumed, is recognised in profit or loss as
other income or finance costs.
Borrowings are classified as current liabilities unless the Group has an unconditional right to defer
settlement of the liability for at least 12 months after the reporting period.
Derecognition of financial liabilities
A financial liability is derecognised when the obligation under the liability is discharged or cancelled
or expires.
When an existing financial liability is replaced by another from the same lender on substantially
different terms, or the terms of an existing liability are substantially modified, such an exchange or
modification is treated as a derecognition of the original liability and the recognition of a new liability,
and the difference in the respective carrying amounts is recognised in profit or loss.
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 35
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
10.
ISSUED CAPITAL
Issued and paid up capital
999,221,875 Ordinary shares
(31 December 2018: 994,821,875)
10.A. MOVEMENTS IN ISSUED CAPITAL
At the beginning of the period
Shares issued during the period:
- Placement @ $0.016
- Payment of Broker Fees in Ordinary Shares
- Payment of Advisor Fees in Ordinary Shares
Share issue costs
At end of the period
10.B. MOVEMENTS IN NUMBER OF SHARES ON ISSUE
At the beginning of the period
Shares issued during the period:
- Placement – 13 and 17 April 2018
- Capital Raising Fees paid in shares in lieu of cash
- Corporate Advisory Fees paid in shares in lieu of cash
At end of the period
10.C. TERMS AND CONDITIONS OF CONTRIBUTED EQUITY
Voting Rights
As at
31 Dec 2019
$
As at
31 Dec 2018
$
225,407,357
225,354,557
Year ended
31 Dec 2019
$
Year ended
31 Dec 2018
$
225,354,557
222,355,544
-
-
52,800
-
225,407,357
3,160,000
46,750
61,600
(269,337)
225,354,557
Year ended
31 Dec 2019
Number
994,821,875
Year ended
31 Dec 2018
Number
790,000,000
-
-
4,400,000
999,221,875
197,500,000
2,921,875
4,400,000
994,821,875
Ordinary shares participate in dividends and the proceeds on winding up of the Company in
proportion to the number of shares held and in proportion to the amount paid up on the shares held.
At shareholders meetings, each ordinary share is entitled to one vote in proportion to the paid-up
amount of the share when a poll is called, otherwise each shareholder has one vote on a show of
hands.
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 36
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
10.
ISSUED CAPITAL (continued)
10.D. OPTIONS
At the end of the reporting period, 295,140,625 options over unissued shares were on issue.
Type
Options
Date of Expiry
31 Dec 2020
Exercise Price
AUD
$0.03
Number of Options
on Issue
295,140,625
10.E. MOVEMENTS IN NUMBER OF OPTIONS ON ISSUE
At the beginning of the period
Shares issued during the period:
- Options issued under prospectus
- Options free attaching to placement
- Options issued to advisors, consultants and/or directors
- Options issued in lieu of capital raising fees
- Options expired during the period
At end of the period
11. ACCUMULATED LOSSES
Balance at the beginning of the period
Net loss for the period
Balance at end of the period
12.
RESERVES
Option valuation reserve
Foreign currency translation reserve
As at
31 Dec 2019
Number
70,000,000
As at
31 Dec 2018
Number
460,000,000
225,140,625
-
-
-
-
295,140,625
-
197,500,000
85,000,000
2,921,875
(675,421,875)
70,000,000
As at
31 Dec 2019
$
As at
31 Dec 2018
$
(221,217,935)
917,503
(220,300,432)
(220,000,155)
(1,217,780)
(221,217,935)
As at
31 Dec 2019
$
2,912,845
890,740
3,803,585
As at
31 Dec 2018
$
2,902,864
826,052
3,728,916
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 37
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
12. RESERVES (continued)
12.A. OPTION VALUATION RESERVE
At the beginning of the period
Options issued during the period:
- Options issued to consultants
- Options issued under prospectus
At end of the period
Option valuation reserve
Year ended
31 Dec 2019
$
2,902,864
Year ended
31 Dec 2018
$
2,618,222
-
9,981
2,912,845
284,642
-
2,902,864
This reserve is used to record the value of equity benefits provided to employees, directors, suppliers
and consultants as part of their remuneration and value of all other options issued by the Company.
Refer to Note 21.
12.B.
FOREIGN CURRENCY RESERVE
At beginning of the period
Movement during the period
Balance at end of the period
Foreign Currency Translation Reserve
Year ended
31 Dec 2019
$
826,052
64,688
890,740
Year ended
31 Dec 2018
$
(291,127)
1,117,179
826,052
Foreign currency translation reserve records exchange differences arising on translation of the
subsidiaries’ functional currency (US Dollars) into presentation currency at balance date.
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 38
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
13. CASH FLOW INFORMATION
13.A. RECONCILIATION OF NET PROFIT/(LOSS) AFTER TAX TO THE NET CASH FLOWS FROM OPERATIONS
Net profit/(loss)
Non-cash items
Gain on disposal
Share based payment expense
Foreign currency translation
Interest on borrowings
Fair value loss on equity investment
Amortisation expense
Changes in assets and liabilities
Increase in receivables and other assets
Decrease in payables and accruals
Net cash flows from / (used in) operating activities
Reconciliation of cash:
Cash balances comprises
AUD accounts
USD accounts
Year ended
31 Dec 2019
$
Year ended
31 Dec 2018
$
917,503
(1,217,780)
(1,076,763)
52,800
11,216
602,160
97,500
353,255
(442,347)
(24,135)
491,189
(810,804)
346,242
344,405
586,666
-
-
39,436
(39,156)
(751,351)
846,967
209,212
1,056,179
8,432
1,184,874
1,193,306
13.B. CHANGES IN LIABILITIES ARISING FROM FINANCING ACTIVITIES
Balance as at as at 1 January 2018
Net cash from (used in) financing activities
Interest accrued on borrowings
Exchange differences
Balance as at 31 December 2018
Balance as at as at 1 January 2019
Net cash from (used in) financing activities
Interest accrued on borrowings
Exchange differences
Balance as at 31 December 2019
Loans
$
3,022,744
743,519
586,666
291,909
4,644,838
4,644,838
109,981
602,160
5,806
5,362,785
Consolidated
Convertible
notes
$
Lease
liability
$
-
-
-
-
-
-
-
-
-
-
Total
$
3,022,744
743,519
586,666
291,909
4,644,838
4,644,838
109,981
602,160
5,806
5,362,785
-
-
-
-
-
-
-
-
-
-
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 39
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
14.
KEY MANAGEMENT PERSONNEL DISCLOSURES
14.A. REMUNERATION OF DIRECTORS AND EXECUTIVES
Details of remuneration paid to Key Management Personnel have been disclosed in the Directors’
Report.
Aggregate of remuneration paid to Key Management Personnel during the period as follows:
Short term employee benefits
Post-employment benefits
Share-based payments
As at
31 Dec 2019
$
As at
31 Dec 2018
$
260,000
-
-
260,000
260,000
-
-
260,000
During the year ended 31 December 2019, Cicero Group Pty Ltd (Cicero), an entity related to Loren
King, received $114,000 exclusive of GST for the provision of company secretarial and accounting
work to the Group. Cicero has been engaged to provide corporate services to the Company.
15.
SEGMENT INFORMATION
Brookside Energy Limited operates predominantly in one industry being the oil and gas industry in the
USA.
Identification of reportable segments
The Company has identified its operating segments based on the internal reports that are reviewed
and used by the Board of Directors in assessing performance and determining the allocation of
resources.
The Company is managed primarily on the basis of its oil and gas interests in the USA and its corporate
activities in Australia. 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.
Types of reportable segments
(i) Oil and gas exploration: Segment assets, including acquisition cost of exploration licenses and
all expenses related to the projects in the USA are reported on in this segment.
(ii) Corporate, including treasury, corporate and regulatory expenses arising from operating an ASX
listed entity. Segment assets, including cash and cash equivalents, and investments in financial
assets are reported in this segment.
Basis of accounting for purposes of reporting by operating segments.
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 40
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
15.
SEGMENT INFORMATION (continued)
Accounting policies adopted
Unless stated otherwise, all amounts reported to the Board of Directors as the chief decision maker
with respect to operating segments are determined in accordance with accounting policies that are
consistent to those adopted in the annual financial statements of the Group.
Segment assets
Where an asset is used across multiple segments, the asset is allocated to the segment that receives
the majority of economic value from the asset. In the majority of instances, segment assets are clearly
identifiable on the basis of their nature and physical location.
Unless indicated otherwise in the segment assets note, deferred tax assets and intangible assets have
not been allocated to operating segments.
Segment liabilities
Liabilities are allocated to segments where there is direct link between the incurrence of the liability
and the operations of the segment. Borrowings and tax liabilities are generally considered to relate to
the Company as a whole and are not allocated. Segment liabilities include trade and other payables.
31 December 2018
Segment performance
Segment revenue
Segment results
Included within segment result:
-
- Gain on disposal of investment
- Drawdown facility interest expense
- Option valuation expense
Segment assets
Segment liabilities
Interest Revenue
31 December 2019
Segment performance
Segment revenue
Segment results
Interest Revenue
Included within segment result:
-
- Gain on disposal of investment
- Drawdown facility interest expense
- Share based payments expense
Segment assets
Segment liabilities
Corporate
$
Oil and Gas
& Other US
Entities
$
Total
$
1,183
(1,539,918)
908,804
322,138
909,987
(1,217,780)
1,183
-
-
(346,242)
549,751
(71,751)
-
810,804
(586,666)
-
12,032,377
(4,644,838)
102
(1,486,894)
3,264,071
2,404,397
102
-
-
(52,800)
1,280,175
4,162,277
-
1,076,763
(602,160)
-
13,040,737
1,248,125
1,183
810,804
(586,666)
(346,242)
12,582,128
(4,716,589)
3,264,173
917,503
102
1,076,763
(602,160)
(52,800)
14,320,912
5,410,402
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 41
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
16.
EARNINGS/(LOSS) PER SHARE
The following reflects the income and share data used in the calculation of basic and diluted
earnings/(loss) per share:
As at
31 Dec 2019
$
As at
31 Dec 2018
$
Earnings/(loss) used in calculation of basic and diluted loss per
share
917,503
(1,217,780)
Weighted average number of ordinary shares on issue used in
the calculation of basic loss per share
998,762,534
933,943,553
Basic earnings per share is calculated as net profit or loss attributable to members of the parent,
adjusted to exclude any costs of servicing equity (other than dividends) and preference share
dividends, divided by the weighted average number of ordinary shares, adjusted for any bonus
element.
Diluted earnings per share is calculated as net profit or loss attributable to members of the parent,
adjusted for:
•
•
•
costs of servicing equity (other than dividends) and preference share dividends;
the after-tax effect of dividends and interest associated with dilutive potential ordinary
shares that have been recognised as expenses; and
other non-discretionary changes in revenues or expenses during the period that would
result from the dilution of potential ordinary shares; divided by the weighted average
number of ordinary shares and dilutive potential ordinary shares, adjusted for any bonus
element.
17.
RELATED PARTY DISCLOSURE
On 5 August 2015, the Group entered into an agreement with Cicero Group Pty Ltd (an entity in which
Mrs King is shareholder and director) (Cicero) defining the terms of engagement for the provision of
administration services by Cicero as a contractor to the Group. Cicero will provide the office rent,
bookkeeping, company secretarial and administration services to the Company for a monthly fee of
$9,500 plus GST. Fees paid to Cicero for the period ending 31 December 2019 is $114,000 (exc. GST).
18. AUDITOR’S REMUNERATION
The auditor of Brookside Energy Limited is HLB Mann Judd.
Amounts received or due and receivable to the auditor for:
Audit or reviewing the financial report.
Year ended
31 Dec 2019
$
Year ended
31 Dec 2018
$
32,682
32,682
29,680
29,680
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 42
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
19.
FINANCIAL INSTRUMENTS
The main risks arising from the Group’s financial instruments are market risk, currency risk and interest
rate risk.
This note presents information about the Group’s exposure to each of the above risks, their objectives,
policies and processes for measuring and managing risk, and the management of capital.
The Board has overall responsibility for the establishment and oversight of the risk management
framework. The Board reviews and agrees policies for managing each of these risks and they are
summarised below.
The Group’s principal financial instruments comprise cash and short-term deposits. The main purpose
of the financial instruments is to earn the maximum amount of interest at a low risk to the Group. The
Group also has other financial instruments such as trade debtors, creditors and borrowings which arise
directly from its operations.
Market Risk
Market risk is the risk that changes in market prices such as foreign exchange rates, interest rates and
equity prices will affect the Group’s income or the value of its holdings of financial instruments.
The Group is exposed to movements in market interest rates on short term deposits. The policy is to
monitor the interest rate yield curve out to 120 days to ensure a balance is maintained between the
liquidity of cash assets and the interest rate return. The Group does not have short- or long-term debt,
and therefore this risk is minimal.
Currency Risk
Foreign exchange risk arises from future commitments, assets and liabilities that are denominated in a
currency that is not he functional currency of the Group. The Group deposits are denominated in both
US and Australian dollars. At the year end the majority of deposits were held in Australian dollars.
Currently, there are no foreign exchange programs in place. The Group treasury function manages
the purchase of foreign currency to meet operational and budgetary requirements. The impact of
reasonably possible changes in foreign exchange rates for the Group is not material.
Interest Rate Risk
The table below reflects the undiscounted contractual settlement terms for financial instruments of a
fixed period of maturity, as well as management’s expectations of the settlement period for all other
financial instruments. As such, the amounts might not reconcile to the statement of financial position.
Credit Risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in
financial loss to the Group. The Group has adopted the policy of only dealing with creditworthy
counterparties and obtaining sufficient collateral or other security where appropriate, as a means of
mitigating the risk of financial loss from defaults.
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 43
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
19.
FINANCIAL INSTRUMENTS (continued)
The Group operates in the energy exploration and production sector; it therefore does not supply
products and have trade receivables and is not exposed to credit risk in relation to trade receivables.
The Group does not have any significant credit risk exposure to any single counterparty or any
Company of counterparties having similar characteristics.
The Group’s maximum exposure to credit risk at each balance date in relation to each class of
recognised financial assets is the carrying amount, net of any allowance for doubtful debts, of those
assets as indicated in the statement of financial position. The maximum credit risk exposure of the
Group at 31 December 2019 is Nil (2018: Nil). There are no impaired receivables at 31 December 2019
(2018: Nil).
Interest Rate Sensitivity Analysis
At 31 December 2019, if interest rates had been 2% higher or lower than the prevailing rates realised,
with all other variables held constant, the effect on profit made in period and equity as a result of
interest rates changes would be as follows:
Change in profit made in period
Increase in interest rate by 2%:
AUD accounts
USD accounts
Decrease in interest rate by 2%:
AUD accounts
USD accounts
Change in equity
Increase in interest rate by 2%:
AUD accounts
USD accounts
Decrease in interest rate by 2%:
AUD accounts
USD accounts
Liquidity Risk
31 Dec 2019
31 Dec 2018
Net Change
$
Net Change
$
(16,939)
(4,184)
(21,123)
16,939
4,184
21,123
(16,939)
(4,184)
(21,123)
16,939
4,184
21,123
(167)
(23,697)
(23,864)
167
23,697
23,864
(167)
(23,697)
(23,864)
167
23,697
23,864
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due.
The Group’s approach to managing liquidity is to ensure, as far as possible, that it will always have
sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without
incurring unacceptable losses or risking damage to the Group’s reputation. The Group manages
liquidity risk by monitoring forecast cash flows on a rolling monthly basis. The Group does not have any
significant liquidity risk as the Group does not have any collateral debts.
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 44
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
19.
FINANCIAL INSTRUMENTS (continued)
Capital Management
The Group’s objectives when managing capital are to safeguard its ability to continue as a going
concern, so it may continue to provide returns for shareholders and benefits for other stakeholders.
Accordingly, the objective of the Group’s capital risk management is to balance the current working
capital position against the requirements to meet exploration programmes and corporate overheads.
This is achieved by maintaining appropriate liquidity to meet anticipated operating requirements, with
a view to initiating appropriate capital raisings as required.
The directors consider that the carrying value of the financial assets and financial liabilities recognised
in the consolidated financial statement approximate their fair value.
19.A. FAIR VALUE MEASUREMENT OF FINANCIAL INSTRUMENTS
Financial assets and financial liabilities measured at fair value in the statement of financial position are
grouped into three levels of the following fair value measurement hierarchy in accordance with AASB
7 Financial Instruments:
Disclosures
•
•
•
Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities;
Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset
or liability, either directly or indirectly;
Level 3: unobservable inputs for the asset or liability.
The following table shows the levels within the hierarchy of financial assets and liabilities measured at
fair value on a recurring basis at 31 December 2018 and 31 December 2019:
Level 1
$
Level 2
$
Level 3
$
Total
$
31 December 2018
Financial assets
Cash and cash equivalents
Receivables
Total financial assets
Financial liabilities
Payables
Loans and borrowings
Total financial liabilities
31 December 2019
Financial assets
Cash and cash equivalents
Receivables
Total financial assets
Financial liabilities
Payables
Loans and borrowings
Total financial liabilities
1,193,306
24,337
1,217,643
(71,751)
(4,644,838)
(4,716,589)
1,056,179
466,684
1,522,863
(47,617)
(5,362,785)
(5,410,402)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,193,306
24,337
1,217,643
(71,751)
(4,644,838)
(4,716,589)
1,056,179
466,684
1,522,863
(47,617)
(5,362,785)
(5,410,402)
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 45
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
19.
FINANCIAL INSTRUMENTS (continued)
Net fair value of financial assets and liabilities
The carrying amount of cash and cash equivalents approximates fair value because of their short-
term maturity.
20. CONTINGENT ASSETS AND LIABILITIES
There are no contingent liabilities or contingent assets.
21.
SHARE BASED PAYMENT PLANS
The cost of these equity-settled transactions with employees is measured by reference to the fair value
of the equity instruments at the date at which they are granted. The fair value is determined by an
external valuer using a Black-Scholes model, using assumptions provided by the Company.
In valuing equity-settled transactions, no account is taken of any performance conditions, other than
conditions linked to the price of the shares of Brookside Energy Ltd (market conditions), if applicable.
The cost of equity-settled transactions is recognised, together with a corresponding increase in equity,
over the period in which the performance and/or service conditions are fulfilled, ending on the date
on which the relevant employees become fully entitled to the award (the vesting period).
The cumulative expense recognised for equity-settled transactions at each reporting date until vesting
date reflects:
(i)
(ii)
the extent to which the vesting period has expired; and
the Group’s best estimate of the number of equity instruments that will ultimately vest.
No adjustment is made for the likelihood of market performance conditions being met as the effect
of these conditions is included in the determination of fair value at grant date. The statement of
comprehensive income charge or credit for a period represents the movement in cumulative expense
recognised as at the beginning and end of that period.
No expense is recognised for awards that do not ultimately vest, except for awards where vesting is
only conditional upon a market condition.
If the terms of an equity-settled award are modified, as a minimum an expense is recognised as if the
terms had not been modified. In addition, an expense is recognised for any modification that
increases the total fair value of the share-based payment arrangement, or is otherwise beneficial to
the employee, as measured at the date of modification.
If an equity-settled award is cancelled, it is treated as if it had vested on the date of cancellation, and
any expense not yet recognised for the award is recognised immediately. However, if a new award is
substituted for the cancelled award and designated as a replacement award on the date that it is
granted, the cancelled and new award are treated as if they were a modification of the original
award, as described in the previous paragraph.
The dilutive effect, if any, of outstanding options is reflected as additional share dilution in the
computation of earnings per share. Refer Note 16.
There were no share based payment plans in place for the 31 December 2019 and 2018 financial
years.
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 46
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
22.
PARENT ENTITY DISCLOSURES
Financial Position
Assets
Current assets
Non-current assets
Total assets
Liabilities
Current liabilities
Total liabilities
Equity
Issued capital
Accumulated losses
Reserves
Total equity
Financial performance
Loss for the period
Other comprehensive income
Total comprehensive income
Contingent liabilities
Year Ended
31 Dec 2019
$
Year Ended
31 Dec 2018
$
851,865
8,711,225
9,563,090
174,751
10,639,097
10,813,848
4,162,276
4,162,276
4,067,509
4,067,509
225,407,358
(222,919,389)
2,912,845
5,400,814
225,354,557
(221,511,082)
2,902,864
6,746,339
(931,730)
-
(931,730)
(1,539,918)
-
(1,539,918)
As at 31 December 2019 and 2018, the Company had no contingent liabilities.
Contractual Commitments
As at 31 December 2019 and 2018, the Company had no contractual commitments.
Guarantees entered into by parent entity
As at 31 December 2019 and 2018, the Company had not entered into any guarantees.
The financial information for the parent entity, Brookside Energy Ltd, has been prepared on the same
basis as the consolidated financial statements, except as set out below.
Investments in subsidiaries, associates and joint venture entities
Investments in subsidiaries, associates and joint venture entities are accounted for at cost in the parent
entity’s financial statements.
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 47
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
23. COMMITMENTS FOR EXPENDITURE
Capital Commitments – Black Mesa Productions LLC
Within one year^
After one year but not more than five years
More than five years
^ Equivalent of 2018: USD253,020
24.
SUBSEQUENT EVENTS
As at
31 Dec 2019
$
As at
31 Dec 2018
$
-
-
-
-
358,792
-
-
358,792
The Company announced on 16 January 2020, significant initial production results from wells drilled
adjacent to the Company’s assets in Brookside’s SWISH Area of Interest (SWISH AOI), in the world-class
Anadarko Basin, Oklahoma.
On 3 February 2020, the Company announced the appointment of Non-Executive Director Mr Richard
Homsany.
The Company announced on 27 February 2020, it had secured two additional SWISH Area of interest
in the Anadarko Basin, Oklahoma.
Post balance date, we have seen the emergence of significant uncertainty in the global investment
environment as a result of the spread of COVID-19. This uncertainty and the impact that a global
slowdown in economic activity would have on demand has caused abnormally large volatility in
commodity markets, including the price of oil and gas. The scale and duration of these developments
remain uncertain but may impact our future earnings, cash flow and financial conditions.
No other matters or circumstances have arisen since the end of the full year which significantly
affected or could significantly affect the operations of the Company, the results of these operations,
or the state of affairs of the Company in future financial years.
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 48
DIRECTORS’ DECLARATION
1)
In the opinion of the directors of Brookside Energy Limited (the ‘Company’):
a)
the financial statements, notes and the additional disclosures are in accordance with the
Corporations Act 2001 (Cth) including:
i) giving a true and fair view of the Group’s financial position as at 31 December 2019 and
of its performance for the year then ended; and
ii) complying with Australian Accounting Standards (including the Australian Accounting
Interpretations) and the Corporations Regulations 2001;
b)
there are reasonable grounds to believe that the Company will be able to pay its debts as
and when they become due and payable; and
c)
the financial statements and notes thereto are in accordance with International Financial
Reporting Standards issued by the International Accounting Standards Board.
2)
This declaration has been made after reviewing the declarations required to be made to the
directors in accordance with Section 295A of the Corporations Act 2001 (Cth) for the financial
year ended 31 December 2019.
This declaration is made in accordance with a resolution of the Board of Directors and is signed for
and on behalf of the Directors by:
David Prentice
Chief Executive Officer
31 March 2020
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 49
INDEPENDENT AUDITOR’S REPORT
To the members of Brookside Energy Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Brookside Energy Limited (“the Company”) and its controlled
entities (“the Group”), which comprises the consolidated statement of financial position as at 31
December 2019, the consolidated statement of profit or loss and other 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:
a) giving a true and fair view of the Group’s financial position as at 31 December 2019 and of its
financial performance for the year then ended; and
b) 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 believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Material uncertainty related to going concern
We draw attention to Note 1A.3 in the financial report, which indicates that a material uncertainty
exists that may cast significant doubt on the entity’s ability to continue as a going concern. Our
opinion is not modified in respect of this matter.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance
in our audit of the financial report of the current period. These matters were addressed in the context
of our audit of the financial report as a whole, and in forming our opinion thereon, and we do not
provide a separate opinion on these matters. In addition to the matter described in the Material
Uncertainty Related to Going Concern, we have determined the matters described below to be the
key audit matters to be communicated in our report.
Page 50
Key Audit Matter
How our audit addressed the key audit matter
Stack Acreage Exploration and Evaluation
Note 7
In accordance with AASB 6 Exploration for
Evaluation of Mineral Resources, the Group
capitalises all exploration and evaluation
expenditure, including acquisition costs, and
subsequently applies the cost model after
recognition.
Our audit focussed on the Group’s assessment
of the carrying amount of the capitalised
exploration and evaluation asset, as this is one
of the most significant assets of the Group. We
planned our work to address the audit risk that
the capitalised expenditure might no longer
meets the addition, we considered it necessary
to assess whether facts and circumstances
existed to suggest that the carrying amount of
an exploration and evaluation asset may exceed
its recoverable amount.
Our procedures included but were not limited to
the following:
• We obtained an understanding of the key
processes associated with management’s
review of carrying values of each area of
interest;
• We considered the Directors’ assessment of
potential indicators of impairment;
• We obtained evidence that the Group has
current right to tenure of its areas of interest;
• We examined the exploration budget for the
year 2020 and discussed with management
the nature of planned and ongoing activities;
• We enquired with management, reviewed
ASX announcements and reviewed minutes
of Directors’ meetings to ensure that the
Group had not resolved to discontinue
exploration and evaluation at any of its areas
of interest; and
Ensuring the adequacy of disclosures made
within the financial report
Revenue and related risk of fraud
Note 2
A substantial amount of the Company's revenue
relates to the royalty received from the sale of
oil and gas as well as the sales of acreage.
Revenue recognition was a key audit matter due
to the importance and materiality of the matter
to users understanding of the financial report
Our procedures included but were not limited to:
− Ensuring that accounting policies comply with
Australian Accounting standards;
− Performing testing over a sample of revenue
to supporting evidence;
− Ensuring the adequacy of disclosures made
within the financial report
Information other than the financial report and auditor’s report thereon
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 31 December 2019, but does
not include the financial report and our 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.
Page 51
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 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.
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional
judgement and maintain professional scepticism throughout the audit. We also:
-
Identify and assess the risks of material misstatement of the financial report, whether due to
fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not
detecting a material misstatement resulting from fraud is higher than for one resulting from
error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the
override of internal control.
-
-
- Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing
an opinion on the effectiveness of the Group’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by the directors.
Conclude on the appropriateness of the directors’ use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to
events or conditions that may cast significant doubt on the Group’s ability to continue as a
going concern. If we conclude that a material uncertainty exists, we are required to draw
attention in our auditor’s report to the related disclosures in the financial report or, if such
disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit
evidence obtained up to the date of our auditor’s report. However, future events or conditions
may cause the Group to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial report, including the
disclosures, and whether the financial report represents the underlying transactions and
events in a manner that achieves fair presentation.
-
We communicate with the directors regarding, among other matters, the planned scope and timing
of the audit and significant audit findings, including any significant deficiencies in internal control
that we identify during our audit.
We also provide the directors with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other
matters that may reasonably be thought to bear on our independence, and where applicable,
related safeguards.
Page 52
From the matters communicated with the directors, we determine those matters that were of most
significance in the audit of the financial report of the current period and are therefore the key audit
matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter
should not be communicated in our report because the adverse consequences of doing so would
reasonably be expected to outweigh the public interest benefits of such communication.
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included within the directors’ report for the year ended
31 December 2019.
In our opinion, the Remuneration Report of Magnum Mining and Exploration Limited for the year
ended 31 December 2019 complies with section 300A of the Corporations Act 2001.
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
HLB Mann Judd
Chartered Accountants
Perth, Western Australia
31 March 2020
N G Neill
Partner
Page 53
ADDITIONAL SHAREHOLDERS’ INFORMATION
A.
CORPORATE GOVERNANCE
A statement disclosing the extent to which the Company has followed the best practice
recommendations set by the ASX Corporate Governance Council during the reporting period is
detailed following the Director’s Report.
B.
SHAREHOLDING
Substantial Shareholders
The names of the substantial shareholders listed on the Company’s register are:
Name
THE TRUST COMPANY (AUSTRALIA) LIMITED
GREAT SOUTHERN FLOUR MILLS PTY LTD
BNP PARIBAS NOMINEES PTY LTD
MR MARK JAMES CASEY
B.1. Quoted Securities
Number of
Shares
114,721,851
90,000,000
65,917,709
50,265,901
At the date of this report 295,140,625 quoted options over ordinary shares in the Company were on
issue and no options were exercised during the year. The listed options are exercisable at $0.03 per
option and have an expiry date of 31 December 2020.
B.2.
Unquoted Securities
At the date of this report there were no unquoted options over ordinary shares in the Company and
no options were exercised during the year.
B.3.
Number of holders in each class of equity securities and the voting rights attached
There are 2,108 holders of ordinary shares. Each shareholder is entitled to one vote per share held.
On a show of hands every shareholder of ordinary shares present at a meeting in person or by proxy,
is entitled to one vote, and upon a poll each share is entitled to one vote.
B.4.
Distribution schedule of the number of holders in each class of equity security
By Class
1-1,000
1,001 - 5,000
5,001 – 10,000
10,001 - 100,000
100,001 and over
TOTALS
Holders of
Ordinary Shares
854
372
107
333
442
2,108
Number of
Ordinary Shares
289,982
971,297
794,277
16,442,887
983,223,432
1,001,721,875
%
0.03%
0.10%
0.08%
1.64%
98.15%
100.00%
B.5. Marketable Parcel
There are 1,698 shareholders with less than a marketable parcel.
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 54
ADDITIONAL SHAREHOLDERS’ INFORMATION
B.6.
Restricted Securities
The Company has no restricted securities at the current date.
B.7.
Twenty largest holders of each class of quoted equity security
Fully paid ordinary shares
The names of the twenty largest holders of fully paid ordinary shares, the number of securities and
percentage of share capital held is as follows:
Name
THE TRUST COMPANY (AUSTRALIA) LIMITED
GREAT SOUTHERN FLOUR MILLS PTY LTD
BNP PARIBAS NOMINEES PTY LTD
MR MARK JAMES CASEY
STATION NOMINEES PTY LTD
ASPIRE WEST PTY LTD
DOMAEVO PTY LTD
No. of
Shares
%
114,721,851
11.45%
90,000,000
65,917,709
50,265,901
25,000,000
20,000,000
16,214,443
MR RICHARD STUART DONGRAY & MRS JOAN DONGRAY
15,000,000
JKR SUPER PTY LTD
MR HOAI NAM PHAM
AVANTEOS INVESTMENTS LIMITED <7788138 WARCZAK A/C>
MR PAUL SIMON DONGRAY
PANDORA PERTH PTY LTD
DR DANIEL PECHAR & MRS KATRINA PECHAR
MR STEPHEN & NIGEL & RITA & LOISE LAMBERT
AUSEPEN PTY LTD
MR OWEN CLARE & MRS ROSALIND CLARE
MR XIAO PENG
MR IAN ALASTAIR LEETE & MRS HELEN LEETE
MR RUSSELL DREDGE & MRS MELINDA DREDGE
14,750,000
14,061,434
13,956,702
13,850,000
13,500,000
13,400,000
13,000,003
12,971,411
12,799,900
9,450,000
9,166,667
8,937,500
546,963,521
54.60%
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 55
8.98%
6.58%
5.02%
2.50%
2.00%
1.62%
1.50%
1.47%
1.40%
1.39%
1.38%
1.35%
1.34%
1.30%
1.29%
1.28%
0.94%
0.92%
0.89%
ADDITIONAL SHAREHOLDERS’ INFORMATION
Options
The names of the twenty largest option holders, the number of options and percentage of option
capital held is as follows:
Name
MR SCOTT ALAN MALONE
MR MARK JAMES CASEY
No. of
Options
15,000,001
15,000,000
MR DAVID PRENTICE & MRS MIRELLA PRENTICE
15,000,000
BERRY ENTERPRISES PTY LTD
AUSEPEN PTY LTD
THE TRUST COMPANY (AUSTRALIA) LIMITED
MERCHANT FUNDS MANAGEMENT PTY LTD
MR KIRK LARSEN
FRY SUPER PTY LTD
MY H & B PTY LTD
MR STEVEN JOHN DIGGERMAN
RAVENHILL INVESTMENTS PTY LTD
AUSEPEN PTY LTD
EASTERN CAPITAL GROUP LLC
COVE CAPITAL PTY LTD
BNP PARIBAS NOMINEES PTY LTD
MR ASHLEY WILLIAM ROBIN PARKER
DR DANIEL PECHAR & MRS KATRINA PECHAR
MR BRETT JAMES MUIRHEAD
DR MUHAMMAD MALIK
15,000,000
15,000,000
13,152,882
11,404,233
10,076,682
10,000,000
9,500,000
9,311,202
9,123,387
6,666,667
6,666,667
6,666,667
6,478,360
5,930,201
5,000,000
5,000,000
4,635,341
%
5.08%
5.08%
5.08%
5.08%
5.08%
4.46%
3.86%
3.41%
3.39%
3.22%
3.15%
3.09%
2.26%
2.26%
2.26%
2.20%
2.01%
1.69%
1.69%
1.57%
194,612,290
65.92%
BROOKSIDE ENERGY LIMITED | 2019 ANNUAL REPORT
Page 56