ABN 98 006 640 553
ANNUAL REPORT
30 June 2020
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Corporate directory
ANNUAL REPORT
30 June 2020
Managing Director
Non-executive Chairman
Non-executive Director
Non-executive Director (resigned)
Current Directors
David Reeves
Mark Connelly
Keith Coughlan
Adam Miethke
Company Secretary
Julia Beckett
Registered Office
Street:
Suite 12, 11 Ventnor Avenue
Share Registry
Automic Group
WEST PERTH WA 6005
Street:
Level 5, 126 Phillip Street
SYDNEY NSW 2000
Telephone:
+61 (0)8 6245 2050
Postal:
GPO Box 5193
Email:
info@calidus.com.au
SYDNEY NSW 2001
Website:
http://www.calidus.com.au
Telephone:
1300 288 664
Email:
hello@automicgroup.com.au
Website:
http://automicgroup.com.au
Securities Exchange
Australian Securities Exchange
Solicitors
HWL Ebsworth
Level 40, Central Park, 152-158 St Georges Terrace
Level 20, 240 St Georges Terrace
Perth WA 6000
Telephone:
131 ASX (131 279) (within Australia)
Telephone:
+61 (0)2 9338 0000
Facsimile:
Website:
ASX Code
+61 (0)2 9227 0885
www.asx.com.au
CAI
Perth WA 6000
Auditors
Moore Australia
Level 15, Exchange Tower, 2 Esplanade
Perth WA 6000
Telephone:
+61 (0)8 9225 5355
Website:
www.moorestephens.com.au
P a g e | 1
ANNUAL REPORT
30 June 2020
Contents
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
◼ Chairman’s Letter ...................................................................................................................................................................3
◼ Operations Review .................................................................................................................................................................4
◼ Mineral Resource and Ore Reserve Statement ....................................................................................................................15
◼ Directors' report ...................................................................................................................................................................18
◼ Remuneration report ...........................................................................................................................................................24
◼ Auditor's independence declaration ....................................................................................................................................33
◼ Consolidated statement of profit or loss and other comprehensive income .......................................................................34
◼ Consolidated statement of financial position ......................................................................................................................35
◼ Consolidated statement of change in equity ........................................................................................................................36
◼ Consolidated statement of cash flows..................................................................................................................................37
◼ Notes to the consolidated financial statements ...................................................................................................................38
◼ Directors' declaration ...........................................................................................................................................................72
◼
Independent auditor's report ...............................................................................................................................................73
◼ Additional ASX Information ..................................................................................................................................................77
P a g e | 2
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Chairman’s Letter
Dear Shareholder
ANNUAL REPORT
30 June 2020
I am delighted to present to you the 2019-2020 Annual Report for your Company.
The report illustrates the immense success Calidus has enjoyed over the past year, ranging from the results of the Updated Pre-
Feasibility Study on our Warrawoona gold project and securing key project approvals through to the imminent start of early
construction works and our share price, which has doubled.
At the time of writing, we have just secured approval for Warrawoona from the Western Australian Minister for the Environment.
We have also just received indicative term sheets for project funding from potential lenders and we have almost completed the
Feasibility Study.
These milestones highlight the extent to which we are running parallel processes to accelerate the development of Warrawoona.
As part of this approach, are about to commence construction works, including an access road and a 240-person accommodation
camp. These works will pave the way for main construction to start early 2021.
We have been able to adopt a multi-pronged approach to the development of Warrawoona, including the start of the early works,
thanks in part to the $25 million capital raising completed shortly after the end of the financial year. The success of this raising
reflected the strong outlook for Warrawoona. On behalf of the Board, I would like to thank those who supported us in this capital
raising.
The underlying technical and economic strength of Warrawoona was highlighted by the results of the Updated Pre-Feasibility
Study completed towards the end of the financial year. This study indicated Warrawoona was set to produce ~85,000oz a year at
an all-in sustaining cost of A$1,251/oz. This prospect is particularly enticing given that the gold price at the time of writing was
around A$2,650/oz.
The Updated Pre-Feasibility Study included a 24 per cent increase in Reserves to 519,000oz. Based on a gold price of A$2,500/oz,
Warrawoona will generate a post-tax internal rate of return of 77 per cent and have a payback period of just 13 months. The
study also took into account several significant changes that are designed to minimise risk, maximise initial cash generation and
ensure a simple and robust operation to maximise value to shareholders. These strong findings and the current gold price were
key factors in the Board’s decision to accelerate the development timetable.
With the Feasibility Study almost complete, the key approvals in place and early construction works about to start, Calidus is
firmly on track for first production in early 2022.
While we are working furiously to advance Warrawoona as quickly as practicable, your Board and Management are also eager to
identify opportunities which may enable us to grow Warrawoona and the wider Company.
As part of this strategy, Calidus executed a Heads of Agreement during the year under which it can earn an interest of up to 70%
in tenements that host the Otways Project and Reedies porphyry prospect, 50km from Warrawoona.
Exploration undertaken in the 1960s and in the 1980s highlighted strong potential for copper and gold at Otways, though the
area has not been subjected to any modern exploration techniques. At the time of writing, our first drilling program was
underway.
The Otways deal reflects the Company’s plan to continue growing our asset base in the Pilbara. We believe we are well placed to
leverage the infrastructure we are developing at Warrawoona, whether it be through projects that form part of Warrawoona or
become standalone operations.
The past year has seen your Company successfully transition to an emerging gold producer, with momentum building at
Warrawoona on several fronts.
I would like to thank our management team, staff and contractors for their hard work and dedication, which has been integral to
our strong progress.
I also thank our shareholders for their support over the past year and I look forward to reporting to you as construction advances
at Warrawoona.
Mark Connelly
Non-executive Chairman
P a g e | 3
ANNUAL REPORT
30 June 2020
Operations Review
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Calidus Resources is pleased to present its key operating results for the year to 30 June 2020.
HIGHLIGHTS
• Updated Pre-Feasibility Study completed on Warrawoona Project in WA’s Pilbara
o
o
o
o
o
o
o
Study confirms Warrawoona will generate strong margins and cashflow which underpins strong financial returns
Pre-Tax Project Cashflow of $648M, average EBITDA of $97M pa, NPV8% $423M, IRR 88% and payback of 13 months
(assuming gold price of A$2,500/oz)
Post-Tax Project Cashflow of $468M, NPV8% $303M, IRR 77% and payback of 13 months
Pre-production capital cost of $116M including contingency of $6M and pre-production mining costs of $13M
Average gold production of 85koz a year over first 6 years with 90koz in year one
Life of Mine All-In Sustaining Costs (AISC) of $1,251/oz
Total gold production of 623kozs over eight-year life of mine based on current minable inventory
• Ore Reserves increased by 24% to 519,000oz, including 502koz at the main Klondyke mining area
o Maiden Proven Ore Reserve of 2Mt @ 1.0g/t for 66koz in the Klondyke Open Pit
Resources increased by 20% to 1.5Moz
o Measured and Indicated Resources (inclusive of Reserves) total 32.7Mt @ 1.0g/t for 1.05Moz, including 1Moz at the
main Klondyke mining area
Environmental Protection Authority recommended approval of Warrawoona Gold Project
Acquisition of Otways Project near Warrawoona
Strengthened the Group’s management team with the appointment of Richard Hill as Chief Financial Officer
•
•
•
•
Warrawoona Gold Project
Overview
Calidus Resources (ASX:CAI) (Company) is an ASX-listed gold development company which controls the entire Warrawoona Gold
Project (Project) in the East Pilbara district of Western Australia. The Project site is located 28km South East of Marble Bar accessed
by an all-weather road. Marble Bar is two hours travel by road from Port Hedland, Australia’s largest Port and provides ease of access
to logistic routes, major suppliers and relevant skills base (Figure 1).
Figure 1: Location of the Warrawoona Gold Project
P a g e | 4
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
ANNUAL REPORT
30 June 2020
Calidus’ landholding at the Project consists of approximately 780 square kilometres of prospective tenements covering the entire
greenstone belt within the Pilbara Craton. The Project area contains over 200 historic workings and hosts the flagship Klondyke
Prospect and a further three satellite prospects at Fieldings Gully, Copenhagen and Coronation (Figure 2). The Project is located on
granted mining leases which have been recently renewed for 30 years. Gold was first discovered in the Marble Bar area in 1896
and was mined for around 15 years during that period. The majority of the Project is located on the Warrawoona Mining Common
which is excised from the surrounding pastoral lease.
Figure 2: Warrawoona Gold Project Location and tenements
Updated Pre-Feasibility Study and Maiden Reserve
Calidus announced results of the Updated Pre-Feasibility Study (Updated PFS) and a JORC Reserve for its Warrawoona Project in
June 20201.
The Updated PFS Study highlighted the strong cashflow, outstanding financial returns and short payback of Warrawoona. The
Updated PFS included a 24 per cent increase in Reserves to 519,000oz. This underpins forecast production averaging 85,000
ounces a year in the first six years, including 90,000oz in year one, at an average AISC of A$1251/oz.
Based on a gold price of A$2,500/oz, the average gold price for the last six months prior to release of the Updated PFS,
Warrawoona will generate a post-tax internal rate of return of 77 per cent and have a payback period of just 13 months.
Considering these strong findings and the current gold price, Calidus is committed to accelerating its development timetable,
with Project construction planned to start in the March quarter of next year.
1 See ASX Announcement “Updated PFS Delivers Increased Reserves and Robust Financials” dated 29 June 2020.
P a g e | 5
ANNUAL REPORT
30 June 2020
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
The Updated PFS reflects several significant changes that are aimed to minimise risk, maximise initial cash generation and ensure
a simple and robust operation to maximise value to shareholders.
These changes include the modelling technique used in the Mineral Resource that includes greater inherent dilution than the
initial PFS, delaying the underground development until year three to minimise construction capital and allow a single focus on
the low risk Klondyke Open Pit and installation of a ball mill to ensure grind size and operational flexibility.
With a Feasibility Study planned for the September quarter and construction planned in early 2021, the Updated PFS provides a
clear, simple, lower capital and lower risk road map to near term gold production for Calidus.
Production Summary
Initial Mine Life
Total Ore Mined
Gold Recovered
Processing Rate
Average LOM CIL Metallurgical
Recovery
Project Development Capital
Processing Plant
Non-Processing Infrastructure and
Owners Cost
Contingency
Project Development Capital
Pre-Production Mining Costs
Total Pre-Production Capital
Project Economics
Gold Price
Gold Revenue
All-In Sustaining Cost (AISC)2
Project Cashflow (Pre-tax)
NPV8% (Pre-tax)
IRR (Pre-tax)
Project Cashflow (Post-tax)
NPV8% (Post-tax)
IRR (Post tax)
Payback Period3
Units
Years
oz
oz
Mtpa
%
A$M
A$M
A$M
A$M
A$M
A$M
A$/oz
A$M
A$/oz
A$M
A$M
% p.a.
A$M
A$M
% p.a.
Years
Updated PFS
8.0
16.9Mt @ 1.22g/t for 663koz
623,086
Oxide/Transition 2.4Mtpa and Fresh 2.0Mtpa
94.3%
75
22
6
103
13
116
2,500
1,558
1,251
648
423
88%
468
303
77%
1.1
2,200
1,371
1,241
467
295
64%
337
209
54%
1.5
2,800
1,745
1,260
829
552
112%
598
398
100%
0.8
Table 1: Key Project Statistics
2 All-In Sustaining Cost includes mining, processing, site administration, royalty costs and sustaining capital. It does not include exploration, corporate
costs and non-sustaining capital.
3 Payback period is calculated from the month of first gold production.
3 Calidus is estimated to have carried forward tax losses of $40M at 31 December 2020.
4 All figures are presented in nominal Australian Dollars unless otherwise specified. Rounding errors may occur.
P a g e | 6
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
ANNUAL REPORT
30 June 2020
Costs of Production
Open Pit Mining
Underground Mining
Total Mining
Processing and Maintenance
Business Services
Total Cash Cost (C1)
Royalties
Sustaining Capital
LOM Unit Cost
(A$/t)
LOM Unit Cost
(A$/oz)
$18 /t OP Ore
$423 /oz
$56 /t UG Ore
$228 /oz
$24 /t
$15 /t
$2 /t
$41 /t
$3 /t
$2 /t
$652 /oz
$413 /oz
$49 /oz
$1,113 /oz
$77 /oz
$60 /oz
Total All-In Sustaining Cost (AISC)
$46 /t
$1,251 /oz
Table 2: Production Costs
A$2,000/oz
A$2,250/oz
A$2,500/oz
A$2,750/oz
A$3,000/oz
346
209
48%
497
316
68%
648
423
88%
798
530
108%
949
638
128%
A$2,000/oz
A$2,250/oz
A$2,500/oz
A$2,750/oz
A$3,000/oz
252
147
40%
359
225
58%
468
303
77%
2.0
Table 3: Gold Price Sensitivity Analysis
1.4
1.1
577
382
96%
0.9
685
461
116%
0.8
Pre-tax
Project Cashflow
NPV8%
IRR
Post-tax
Project Cashflow
NPV8%
IRR
Unit
A$M
A$M
%
Unit
A$M
A$M
%
Payback Period
Years
P a g e | 7
ANNUAL REPORT
30 June 2020
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Environmental Protection Authority Recommends Approval of Warrawoona Gold Project
The WA Office of the Environmental Protection Authority (EPA) recommended approval of Warrawoona for both the State and
Federal governments under an Accredited Assessment as part of the approval required under the Commonwealth’s Environment
Protection and Biodiversity Conservation Act (EPBC Act).
This is the penultimate stage in the permitting process, with final approval vesting with the Minister for Environment and
anticipated in the September Quarter. The EPA’s report is available on the EPA website.4
Tenure Finalised for Project Development
The Company completed the purchase of tenement E45/5172, which covers most of the historic Marble Bar Goldfield located
just 25km from Warrawoona. The Company also purchased the remaining 50% of tenement E45/4843, which covers the historic
Salgash mining area of the Warrawoona Goldfield. In addition, the Company earned 70% of the Novo Resources Corporation
tenements, which comprise tenements E45/3381, E45/4666, E45/4622, E45/4194, P45/2781 and E45/4934.
Calidus was granted a General Purpose Lease (G45/345). This lease will encompass the processing plant, tails dam and waste
dump for the Project. With the grant of this lease, Warrawoona now has all the Mining Leases, Miscellaneous Leases and General
Purpose Lease tenure required to commence construction (Figure 3)
Figure 3: Granted Leases over the Warrawoona Gold Project
4 See ASX Announcement “EPA Recommends Approval of Warrawoona Gold Project” dated 25 June 2020.
P a g e | 8
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Marble Bar Airport Upgrade
ANNUAL REPORT
30 June 2020
During the year, Calidus announced that it has entered into a Non-Binding Heads of Agreement with the Shire of East Pilbara for
an upgrade to the Marble Bar Airport. The upgrade is expected to facilitate 100 seater jets with an all-weather sealed surface.
The capital cost of the upgrade has been estimated at approximately $7 million with Calidus expected to contribute $2 million.
The Non-Binding Heads of Agreement anticipates the design of the airport being undertaken jointly by the parties. Calidus and
the Shire of East Pilbara will now progress with preparing binding formal agreements in order to fund, construct and operate the
airport with construction anticipated to commence in 2021.
Purchase of Camp
Calidus took advantage of compelling commercial terms to purchase a 240-room accommodation village located in the Pilbara.
The village’s location minimises relocation costs and is a further step forward in the development of Warrawoona.
Calidus has applied for an Early Works Permit providing the option to install the village prior to receiving full Project Development
approval. The village is being stored at Marble Bar with tenders issued for initial installation.
Figure 4: Calidus Village being offloaded at Marble Bar
P a g e | 9
ANNUAL REPORT
30 June 2020
Project Development Timeline
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
As announced on 29 June 2020, in light of the strong findings of its Updated PFS, Calidus will start construction at Warrawoona
in the March quarter of 2021. This will enable the Company to capitalise on a strong gold price outlook and robust forecast
cashflow at Warrawoona.
The project timeline is shown the table below. By the end of the 2020 calendar year, Calidus anticipates being fully permitted
and Project Finance discussions to be well advanced.
Exploration Activities
Drilling Results
During the year Calidus announced a host of outstanding results at the Warrawoona Gold Project5.
RC drilling and diamond filling results demonstrate the strong grade continuity of gold mineralisation along-strike, down-dip and
within the planned Klondyke pit at Warrawoona. Significant intersections include:
•
•
•
•
•
•
•
•
35m @ 2.84 g/t Au from surface in hole 19KLRC218
10m @ 6.81g/t Au from 47m, incl 1m @ 50.77g/t Au from 49m in hole 19KLRC192
12m @ 5.58 g/t Au from 12m in hole 19KLRC270
15m @ 4.33 g/t Au from 6m in hole 19KLRC266
23m @ 2.55 g/t Au from 15m in hole 19KLRC241
15m @ 3.70 g/t Au from 30m in hole 19KLRC288
1m @ 55.21 g/t Au from 278m in hole 19KLDD061
36m @ 1.53 g/t Au from 12m in hole 19KLRC247
5 The information is extracted from the Company’s ASX Announcements entitled “Intercepts of up to 107g/t to underpin Resource
Upgrade” dated 30 July 2019, “Shallow gold intercepts adjacent to Klondyke Open Pit” dated 11 September 2019, “Outstanding
shall drill intersections from Klondyke” dated 2 October 2019, “More wide, shallow intercepts confirm robustness of open pit” dated
22 October 2019, “Drilling hits more shallow, high grade gold at Klondyke” dated 4 November 2019, “Robust infill drilling results to
underpin open-pit resource” dated 25 November 2019, “High-grade gold intersected outside Klondyke Resource” dated 18
December 2019. The Company confirms that it is not aware of any new information or data that materially affects the information
included in the original market announcements. The Company confirms that the form and context in which the Competent Person’s
findings are presented have not been materially modified from the original market announcement.
P a g e | 10
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
ANNUAL REPORT
30 June 2020
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
14m @ 3.80 g/t Au from 1m in hole 19KLRC233
23m @ 2.30 g/t Au from 37m in hole 19KLRC232
26m @ 2.00 g/t Au from 1m in hole 19KLRC227
14m @ 3.51 g/t Au from 2m in hole 19KLRC249
11.78m @ 4.11 g/t Au from 28.95m in hole 19KLDD112
12m @ 3.93 g/t Au from 19m in hole 19KLRC284
22m @ 2.13g/t Au from 19m n hole 19KLRC201
23m @ 2.06 g/t Au from 1m in hole 19KLRC243
9.08m @ 5.11 g/t Au from 24.1m in hole 19KLDD107
2.52m @ 18.02 g/t Au from 232.78m in hole 19KLDD070
1m @ 40.59 g/t Au from 156m in hole 19KLDD083
20m @ 1.97 g/t Au from 25m in hole 19KLRC245
16m @ 2.47 g/t Au from 4m in hole 19KLRC253
20m @ 1.96 g/t Au from 20m in hole 19KLRC271
11m @ 3.41 g/t Au from surface in hole 19KLRC306
12m @ 3.05 g/t Au from 43m in hole 19KLRC283
26m @ 1.37 g/t Au from 9m in hole 19KLRC281
11 RC holes were drilled into the St George deposit to assist in converting resources to an indicated category with outstanding
assays received including:
•
•
•
13m @ 11.1g/t Au from 30m, incl 1m @ 107.16g/t Au from 36m in hole 19SGRC078
13m @ 5.58g/t Au from 46m in hole 19SGRC081
12m @ 1.73g/t Au from 23m in hole 19SGRC075
An infill RC drill programme was undertaken 300m east of the planned Klondyke pit at the Klondyke East deposit. Significant
intersections included:
•
•
•
14m @ 3.38 g/t Au from 67m in hole 19KLRC523
5m @ 6.69 g/t Au from 62m in hole 19KLRC500
13m @ 2.18 g/t Au from 31m in hole 19KLRC522
Wide-spaced drilling at Klondyke West intersected high-grade areas. Best results included:
•
•
4m @ 3.97 g/t Au from 40m in hole 19KLRC333
1m @ 9.90 g/t Au from 41m in hole 19KLRC325
Klondyke Drilling
On 4 June 2020 Calidus announced that it has resumed drilling at Warrawoona following the opening of regional borders in
Western Australia. The drilling at Klondyke will target the main Klondyke structure 300m directly below the existing Resource and
is expected to be completed in the September Quarter 2020.
Calidus is planning to drill two holes, each with a wedge “daughter” hole drilled off it, beneath the centre of the Klondyke
Resource to test the continuity of mineralisation at a depth of 300m below the existing 250m deep resource. RC pre- collars will
be undertaken to a depth of 400m to 450m before swapping to diamond drilling. The programme is designed to prove continuity
of the Klondyke Structure as a long-term source of ore for the upcoming development.
P a g e | 11
ANNUAL REPORT
30 June 2020
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Otways Project Earn-In and Drilling
Figure 5: Klondyke Drilling
As announced on 27 May 2020, Calidus had entered into a Heads of Agreement with Rugby Mining to earn up to 70% interest in
the Otways Project North Eastof Nullagine. In the late 1960s, shallow (<60m depth) percussion drilling of coincident soil and IP
anomalies by Conwest identified copper mineralisation in metabasalts at or near surface (refer Figure 7). In addition, several
holes contain Cu mineralisation that is open at depth. Historic drilling was never assayed for gold but nearby costean samples
returned values of up to 13g/t Au.
Recent site visits identified the locations of previous drill holes and have confirmed visual occurrences of copper mineralisation
at surface and in shallow workings.
Figure 6: Tenements at the Otways Project with the GSWA 500k geology and prospect locations
P a g e | 12
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
ANNUAL REPORT
30 June 2020
Figure 7: Cross section at the Otways Project showing the results of shallow percussion drilling by Conwest in the
1960s
Figure 8: Map of the Otways–Malachite Flats area showing the locations of the planned drill holes on a horizontal
conductivity slice at 100m depth from a HoistEM survey flown by Hazelwood Resources.
P a g e | 13
ANNUAL REPORT
30 June 2020
Corporate
Financial Results
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
At 30 June 2020, Calidus and its subsidiaries held $5.7 million in cash and $1.4m in listed investments.
Capital Raising
On 15 August 2019, the Company announced the successful placement of $9M to institutional investors. The placement received
strong support from new and existing institutional investors for the continued advancement of Warrawoona.
During the year Company also received $1,302,500 from the exercise of previously issued options.
Consolidation of Share Capital
At the Annual General Meeting held on 25 November 2019, shareholders approved to consolidate the Company’s issued capital
through the conversion of every ten (10) existing shares into one (1) share. The number of the Company’s shares on issue was
reduced from 2,146,887,024 existing shares to 214,689,064 shares.
Appointment of Chief Financial Officer
On 25 November 2019, the Company announced the appointment of Mr Richard Hill as Chief Financial Officer. Mr Hill is an
accomplished finance professional with more than 20 years of experience in the resources sector, primarily in the gold industry. Mr
Hill brings direct experience with respect to feasibility studies, construction and development, mine operations as well as corporate
combination and integration activities.
Community Relations
As part of the Project Permitting process, and wider stakeholder engagement, Calidus staff and representatives have held
meetings and project updates with Traditional Owners, Pastoralists, surrounding mines and tenure holders, the Marble Bar
Community, Shire of East Pilbara, State Government Agencies - DMIRS (Department of Mines, Industry Regulation and Safety),
DWER (Department of Water and Environment Regulation), DBCA (Department of Biodiversity, Conservation and Attractions)
and Federal Government Agency DoEE (Department of Environment and Energy).
Calidus is proud to sponsor the Indigenous Art and Literacy Program at the Marble Bar School and Warralong Community School.
The Indigenous Youth Art program is designed to consist of high quality arts and cultural workshops that are focused on the
education, health and wellbeing of Indigenous youth. It will also promote the artistic talents of Indigenous children across
Australia with a program which is designed to capture the interests of those Indigenous children in regional and remote areas.
Investor Relations
The Managing Director presented and attended numerous investor conferences throughout the year including RIU Fremantle
Diggers and Deals and Resource Risings Stars Gold Coast. Physical roadshows were completed in Sydney, Melbourne and Perth
for meetings with investors. Due to COVID 19 restrictions and border closures roadshows and interstate and international investor
meetings were limited to online meeting conferences for the majority of the first half of 2020.
P a g e | 14
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Mineral Resources and Reserves
ANNUAL REPORT
30 June 2020
Table 4 Mineral Resources (inclusive of Reserves; rounded to nearest 100,000t; 0.01g/t; 1,000oz)
Deposit
Cut-Off
(g/t)
kt
Proven
Au
(g/t)
koz
kt
Probable
Au
(g/t)
Klondyke Open Pit
Klondyke Underground
St George Open Pit
Copenhagen Open Pit
0.33
0.36
2.0
0.36
0.39
1.88
2,057
1.0
66
10,014
1,199
244
95
Total
2,057
1.0
66
11,552
1.0
2.4
1.2
5.5
1.2
Table 5 Ore Reserves (rounded to nearest 1,000t; 0.1g/t; 1,000oz)
koz
kt
335
12,071
92
9
17
453
1,199
244
95
13,609
Total
Au
(g/t)
1.0
2.4
1.2
5.5
1.2
koz
401
92
9
17
519
COMPETENT PERSONS STATEMENT
The information in this announcement that relates to exploration targets and exploration results is based on and fairly represents information
compiled by Mr. Steve Sheppard a competent person who is a member of the AusIMM. Mr. Steve Sheppard is employed by Calidus Resources
Limited. Steve has sufficient experience that is relevant to the style of mineralisation and type of deposits under consideration and to the activity
being undertaken to qualify as a Competent Person as defined in the 2012 edition of the “Australasian Code of Reporting of Exploration
Results, Mineral Resources and Ore Reserves”. Mr. Steve Sheppard consents to the inclusion in this announcement of the matters based on
his work in the form and context in which it appears.
The information in this report that relates to Klondyke Underground and Coronation Mineral Resources is based on and fairly represents
information compiled or reviewed by Mr. Lynn Widenbar, Principal Consultant of Widenbar and Associates Pty Ltd., who is a Member of the
AusIMM and the AIG. Mr. Lynn Widenbar is a full-time employee of Widenbar and Associates Pty Ltd. and has sufficient experience, which is
relevant to the style of mineralisation and types of deposit under consideration and to the activities undertaken, to qualify as a Competent Person
as defined in the 2012 Edition of the “Australasian Code of Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Mr. Lynn
Widenbar consents to the inclusion of the report of the matters based on the information in the form and context in which it appears.
The information in this report that relates to Copenhagen and Fieldings Gully Mineral Resources is based on and fairly represents information
compiled or reviewed by Mr. Ben Playford, who is a Member of the AIG. Mr. Ben Playford is a full-time employee of Calidus Resources Limited. and
has sufficient experience, which is relevant to the style of mineralisation and types of deposit under consideration and to the activities undertaken,
to qualify as a Competent Person as defined in the 2012 Edition of the “Australasian Code of Reporting of Exploration Results, Mineral Resources
and Ore Reserves". Mr. Ben Playford consents to the inclusion of the report of the matters based on the information in the form and context in
which it appears.
The information in this report that relates to Klondyke Mineral Resources is based on and fairly represents information compiled or reviewed by
Mr. Jani Kalla, Senior Consultant of Optiro Ltd., who is a Member of the AusIMM and the AIG. Mr. Jani Kalla is a full-time employee of Optiro Ltd.
and has sufficient experience, which is relevant to the style of mineralisation and types of deposit under consideration and to the activities
undertaken, to qualify as a Competent Person as defined in the 2012 Edition of the “Australasian Code of Reporting of Exploration Results, Mineral
Resources and Ore Reserves”. Mr. Jani Kalla consents to the inclusion of the report of the matters based on the information in the form and context
in which it appears.
The information in this report that relates to the Open Pit Ore Reserves is based on and fairly represents information compiled or reviewed by Mr.
Steve O’Grady. Mr O’Grady has confirmed that he has read and understood the requirements of the 2012 Edition of the Australian Code for
Reporting of Exploration Results, Mineral Resources and Ore Reserves. He is a Competent Person as defined by the JORC Code 2012 Edition, having
more than five years experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity for
which he is accepting responsibility. Mr O’Grady is a Member of the AusIMM and consents to the inclusion in the report of the matters based on
his information in the form and context in which it appears.
P a g e | 15
Cut-Off(g/t)MtAu (g/t)KOzMtAu (g/t)KOzMtAu (g/t)KOzMtAu (g/t)KOzKlondyke Open Pit0.32.30.9872290.908448.30.8121739.60.891,133including0.51.61.216420.31.127335.01.0917627.01.12973Klondyke UG1.51.02.87891.83.311622.72.83250including2.00.73.36721.24.081301.93.33202Copenhagen0.50.25.58330.12.6590.34.5442Coronation0.50.52.19340.52.1934Fieldings Gully0.50.31.80160.331.87200.61.8436Total2.30.987230.41.0098211.01.3344243.71.061,494TotalDepositMeasuredIndicatedInferred
ANNUAL REPORT
30 June 2020
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
The information in this report that relates to the Underground Ore Reserves is based on and fairly represents information compiled or reviewed
by Mr. Alastair King. Mr King has confirmed that he has read and understood the requirements of the 2012 Edition of the Australian Code for
Reporting of Exploration Results, Mineral Resources and Ore Reserves. He is a Competent Person as defined by the JORC Code 2012 Edition, having
more than five years experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity for
which he is accepting responsibility. Mr King is a Member of the AusIMM and consents to the inclusion in the report of the matters based on his
information in the form and context in which it appears.
Forward looking Statements and Disclaimers
This announcement does not constitute investment advice. Neither this announcement nor the information contained in it constitutes an offer,
invitation, solicitation or recommendation in relation to the purchase or sale of shares in any jurisdiction. This announcement does not take into
account any person's particular investment objectives, financial resources or other relevant circumstances and the opinions and recommendations
in this announcement are not intended to represent recommendations of particular investments to particular persons. All securities transactions
involve risks, which include (among others) the risk of adverse or unanticipated market, financial or political developments.
To the fullest extent permitted by law, Calidus Resources Limited (the Company or Calidus) does not make any representation or warranty, express
or implied, as to the accuracy or completeness of any information, statements, opinions, estimates, forecasts or other representations contained in
this announcement. No responsibility for any errors or omissions from this announcement arising out of negligence or otherwise is accepted.
This announcement may include forward looking statements. Forward looking statements are only predictions and are subject to risks, uncertainties
and assumptions which are outside the control of Calidus. These risks, uncertainties and assumptions include commodity prices, currency
fluctuations, economic and financial market conditions in various countries and regions, environmental risks and legislative, fiscal or regulatory
developments, political risks, project delay or advancement, approvals and cost estimates. Actual values, results or events may be materially
different to those expressed or implied in this announcement. Given these uncertainties, readers are cautioned not to place reliance on forward
looking statements. Any forward looking statements in this announcement speak only at the date of issue of this announcement. Subject to any
continuing obligations under applicable law and the ASX Listing Rules, Calidus does not undertake any obligation to update or revise any information
or any of the forward looking statements in this announcement or any changes in events, conditions or circumstances on which any such forward
looking statement is based.
Compliance Statement
The information in this announcement that relates to Exploration Results and Mineral Resources released previously on the ASX.
The Company confirms that it is not aware of any new information or data that materially affects the information included in the original market
announcements and that, in the case of mineral resources estimates, all material assumptions and technical parameters underpinning the estimates
continue to apply and have not materially changed. The Company confirms that the form and context in which the Competent Person’s findings are
presented have not been materially modified from the original market announcements.
P a g e | 16
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
TENEMENT SCHEDULE AS AT 30 JUNE 2020
ANNUAL REPORT
30 June 2020
CALIDUS RESOURCES & SUBSIDAIRIES
TENEMENT SCHEDULE
Tenement ID
Holder
Size (ha)
Renewal
Ownership/
Interest
Keras (Pilbara) Gold Pty Ltd
Keras (Pilbara) Gold Pty Ltd
Keras (Pilbara) Gold Pty Ltd
Keras (Pilbara) Gold Pty Ltd
Keras (Pilbara) Gold Pty Ltd
Keras (Pilbara) Gold Pty Ltd
Keras (Pilbara) Gold Pty Ltd
Keras (Pilbara) Gold Pty Ltd
Keras (Pilbara) Gold Pty Ltd
Keras (Pilbara) Gold Pty Ltd
Keras (Pilbara) Gold Pty Ltd
Keras (Pilbara) Gold Pty Ltd
Keras (Pilbara) Gold Pty Ltd
Keras (Pilbara) Gold Pty Ltd
Keras (Pilbara) Gold Pty Ltd
Keras (Pilbara) Gold Pty Ltd
Keras (Pilbara) Gold Pty Ltd
2,554.05
6,704.61
3,513.73
958.25
638.86
319.46
18.11
17.72
9.71
242.05
101.95
113.10
118.65
116.20
121.30
235.95
6.07
Keras (Pilbara) Gold Pty Ltd
1,917.75
20/05/2023
20/05/2023
22/11/2020
19/10/2024
29/11/2022
29/11/2022
10/03/2034
2/05/2035
18/01/2035
28/12/2037
28/12/2037
29/12/2037
29/11/2037
1/08/2037
8/04/2038
17/04/2038
17/11/2028
1/03/2022
Keras (Pilbara) Gold Pty Ltd
Keras (Pilbara) Gold Pty Ltd
251.51
194.57
APPLICATION
APPLICATION
Epminex WA Pty Ltd
4,307.32
30/05/2024
Beatons Creek Gold Pty Ltd
Beatons Creek Gold Pty Ltd
Beatons Creek Gold Pty Ltd
Beatons Creek Gold Pty Ltd
Beatons Creek Gold Pty Ltd
Beatons Creek Gold Pty Ltd
Beatons Creek Gold Pty Ltd
Beckton Gledhill Pty Ltd
Beckton Gledhill Pty Ltd
7,965.63
3,163.98
4,222.07
1,596.99
2.42
439.05
1,376.89
7,961.50
5,414.50
16/03/2021
23/11/2021
4/05/2022
22/01/2023
10/06/2020
11/05/2041
APPLICATION
04/07/2022
01/08/2022
Earning 70%
Earning 70%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
0%
70%
70%
70%
70%
70%
70%
70%
GRANTED
E45/4856
E45/4857
E45/3615
E45/4236
E45/4905
E45/4906
M45/0521
M45/0547
M45/0552
M45/0668
M45/0669
M45/0670
M45/0671
M45/0672
M45/0679
M45/0682
M45/0240
E45/4555
Applications
L45/0527
P46/1972
Option to Acquire
E45/5172
Joint Venture
E45/3381
E45/4666
E45/4622
E45/4934
P45/2781
G45/345
E45/5706
E45/4704
E45/4706
P a g e | 17
ANNUAL REPORT
30 June 2020
Directors' report
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Your directors present their report on the consolidated entity, consisting of Calidus Resources Limited (Calidus or the Company)
and its controlled entities (collectively the Group), for the financial year ended 30 June 2020.
1. Directors
The names of Directors in office at any time during or since the end of the year are:
•
•
•
•
Mr David Reeves
Mr Mark Connelly
Mr Keith Coughlan
Mr Adam Miethke
Managing Director
Non-executive Chairman
Non-executive Director
Non-executive Director (Resigned on 27 July 2020)
Directors have been in office since the start of the year to the date of this report unless otherwise stated.
2.
Company secretary
Ms Julia Beckett was appointed Company Secretary of the Company on 24 September 2018. Ms Beckett holds a Certificate
in Governance Practice and Administration and is an Affiliated Member of the Governance Institute of Australia.
3. Dividends paid or recommended
There were no dividends paid or recommended during the financial year ended 30 June 2020.
4.
Significant changes in the state of affairs
Please refer to the operations review for the significant changes in the state of affairs of the Group that occurred during
the financial year.
5.
Significant changes in principal activities
There were no significant changes to the Group’s principal activities during the financial year.
6. Operating and financial review
6.1
Nature of Operations Principal Activities
Calidus is a gold exploration and development company that controls the Warrawoona Gold Project in the East
Pilbara district of the Pilbara Goldfields in Western Australia.
6.2
Operations review (refer Operations Review on page 4)
6.3
Financial review
a.
b.
Operating results
For the 2020 financial year the Group delivered a loss before tax of $2,094,345 (2019: $1,242,718 loss).
The financial statements have been prepared on a going concern basis, which contemplates the continuity
of normal business activity and the realisation of assets and the settlement of liabilities in the ordinary
course of business.
Financial position
The net assets of the Group have increased from 30 June 2019 by $9,037,777 to $31,023,260 at 30 June
2020 (2019: $21,985,483).
P a g e | 18
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Directors' report
ANNUAL REPORT
30 June 2020
As at 30 June 2020, the Group's cash and cash equivalents increaseddecreased from 30 June 2019 by $1
,545,292 to $5,690,661 at 30 June 2020 (2019: $4,145,369) and had working capital of $4,614,250 (2019:
$2,576,540 working capital), as noted in Note 14f.
6.4
Events subsequent to reporting date
• On 1 July 2020 Calidus announced that tenders for the major contracts, comprising a schedule of rates mining
contract, tailings dam construction, EPC for the processing plant construction and a build, own, operate (BOO)
model for the power station, have been let to the market.
• On 1 July 2020 Calidus announced specialist natural resources investment house Argonaut had been
appointed to act as the Company’s exclusive debt advisor.
• On 13 July 2020 Calidus announced that drilling was to commence at the Otways project.
• On 17 July 2020 the company announced that it had received firm commitments to raise $25 million (before
costs) via a share placement to professional and sophisticated investors through the issue of 49,019,608
shares at a price of $0.51.
• On 27 July 2020 that Mr Adam Miethke resigned as Non-Executive Director of the Company.
• On 5 August 2020 the company announced that experienced mining executive Don Russell had commenced in
the role of General manager operations
• On 5 August 2020 Calidus announced that Environmental Permits had been granted for early works at
Warrawoona which provided the Company with the option to commence installation the mine access road
and accommodation village prior to receiving full project development approval.
• On 5 August 2020 and 12 August 2020, Calidus announced the issuance of 600,000 and 170,000 unlisted
•
options to Donald Russell and an employee respectively.
0n 13 August 2020, Calidus announced that it has issued and allotted 200,000 shares upon the exercise of
200,000 unquoted options, exercise price of nil, expiring 27 December 2023.
• On 24 August 2020. Calidus announced that it had Environmental approval for the Warrawoona Gold Project
granted by the Western Australian Minister for Environment and that and the debt finance process was
progressing with indicative debt term sheets received.
6.5
Future developments, prospects and business strategies
PLANNED WORK FOR 2020/2021
The Company is focussed on advancing the Warrawoona Gold Project under the following timeline:
6.6
Environmental regulations
The consolidated entity will comply with its obligations in relation to environmental regulation on its projects when
it undertakes exploration. The Directors are not aware of any breaches of any environmental regulations during the
year covered by this Report.
P a g e | 19
ANNUAL REPORT
30 June 2020
Directors' report
7.
Information relating to the Directors
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
◼ Mr David Reeves
Qualifications
Experience
Special responsibilities
Interest in Shares and
Options
Directorships held in other
listed entities
Past directorships in the last
3 years
◼ Mr Mark Connelly
Qualifications
Experience
Special responsibilities
Interest in Shares and
Options
Directorships held in other
listed entities
Past directorships in the last
3 years
Managing Director
Mining Engineer Bachelor of Engineering (1st Class honours), Grad Dip Applied Finance, WA Mine
Managers Certificate
Mr Reeves is a Perth-based, qualified mining engineer with 30 years of experience in the mining
industry and was the Non-executive Chairman of European Metals Holdings Limited (ASX and
AIM). Mr Reeves has extensive experience in international capital markets through his
involvement with various listed London and Australia companies.
Mr Reeves was the Project Manager of Zimplats and Afplats prior to their sale for a combined
US$1 billion and prior to this, worked with Delta Gold in Zimbabwe and various gold companies
in Western Australia in which he assumed various roles, including the position of Mine Manager.
None
17,155,004 Fully Paid Ordinary Shares
150,000 Unlisted options, nil exercise price, exp 27 December 2021
3,000,000 Unlisted Option, nil exercise price, exp 27 December 2024
Non-executive Director of Keras Resources Plc (AIM)
Non-executive Chairman of European Metals Holdings Limited (ASX & AIM) – resigned 30 June
2020
Independent Non-executive Chairman
Bachelor of Business, ECU, MAICD, AIMM, Member of SME
Mr Connelly was previously Managing Director of Papillion Resources and was instrumental in
the US$570m takeover of Papillion by B2Gold Corp in October 2014. Prior to Papillon, Mr
Connelly was Chief Operating Officer of Endeavour Mining Corporation, following its merger
with Adamus Resources Limited where he was Managing Director and CEO. Mark was
instrumental in not only the merger, but procurement of project finance and the development
of the Nzema Mine in Ghana into a +100Koz pa mining operation.
Member of Audit and Risk Committee and the Remuneration and Nomination Committee
526,786 Fully Paid Ordinary Shares
300,000 NED Options, nil exercise price, exp 27 December 2023
Non-executive Chairman of Chesser Resources Limited (ASX)
Non-executive Chairman of Oklo Resources Limited (ASX)
Non-executive Chairman of Tao Commodities Ltd (ASX)
Non-executive Chairman of Primero Group Limited (ASX)
Non-executive Chairman of West African Resources Ltd (ASX) from 23 June 2015 to 29 May 2020
Non-executive director of Ausdrill Limited, (ASX) from July 2012 to June 2018
Non-executive director of Tiger Resources Ltd (ASX) from December 2015 to June 2018
Non-executive director of Saracen Mineral Holdings Limited (ASX) from May 2015 to November
2017
Non-executive Chairman of Cardinal Resources Ltd (ASX) from September 2015 to October 2017
◼ Mr. Keith Coughlan
Qualifications
Experience
Special responsibilities
Interest in Shares and
Options
Directorships held in other
listed entities
Past directorships in the last
3 years
Non-executive Director
BA
Mr Coughlan has almost 30 years’ experience in stockbroking and funds management. He has
been largely involved in the funding and promoting of resource companies listed on ASX, AIM
and TSX, has advised various companies on the identification and acquisition of resource
projects and was previously employed by one of Australia’s then largest funds.
Chairman of the Audit and Risk Committee and the Remuneration and Nomination Committee
944,000 Fully Paid Ordinary Shares
200,000 NED Options, nil exercise price, exp 27 December 2023
Executive Chairman of European Metals Holdings Limited (ASX & AIM)
Non-executive Chairman of Doriemus plc (ASX)
Non-executive Director of Southern Hemisphere Mining Limited (ASX)
N/A
P a g e | 20
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Directors' report
ANNUAL REPORT
30 June 2020
◼ Mr Adam Miethke
Qualifications
Experience
Special responsibilities
Interest in Shares and
Options
Directorships held in other
listed entities
Non-executive Director (resigned on 27 July 2020)
Bachelor of Applied Science with First Class Honours in Geology & Master of Business
Administration
Mr Miethke is a geologist with over extensive experience in the metals and mining industry,
funds management and as a corporate advisor.
Mr Miethke initially worked for Rio Tinto’s iron ore division before joining Snowden Mining
Consultants where he worked across all commodities in Australia, Africa, Eastern Europe and
South America. After completing an MBA in 2008, he joined Regent Pacific Group in Hong Kong
as technical director, overseeing the group’s investment portfolio. Between 2011 and 2016, Mr
Miethke was a director of a corporate finance team at Argonaut Capital Limited and led
Argonaut’s metals and mining division.
Chairman of Audit & Risk Committee prior to resignation on 27 July 2020
206,429 Fully Paid ordinary Shares
None
8. Meetings of directors and committees
The number of Directors’ Meetings (including meetings of Committees of Directors) held during the year, and the number
of meetings attended by each Director is as follows:
DIRECTORS'
MEETINGS
AUDIT
COMMITTEE
REMUNERATION
COMMITTEE
Number
eligible to
attend
4
4
4
4
Number
Attended
4
4
4
4
Number
eligible to
attend
-
-
-
-
Number
Attended
-
-
-
-
Number
eligible to
attend
-
-
-
-
Number
Attended
-
-
-
-
Dave Reeves
Mark Connelly
Keith Coughlan
Adam Miethke
9.
Indemnifying officers or auditor
During or since the end of the financial year the Company has given an indemnity or entered into an agreement to
indemnify, or paid or agreed to pay insurance premiums as follows:
•
•
The Company has entered into agreements to indemnify all Directors and provide access to documents, against any
liability arising from a claim brought by a third party against the Company. The agreement provides for the Company
to pay all damages and costs which may be awarded against the Directors.
The Company has paid premiums to insure each of the Directors against liabilities for costs and expenses incurred
by them in defending any legal proceedings arising out of their conduct while acting in the capacity of Director of
the Company, other than conduct involving a willful breach of duty in relation to the Company. Under the terms
and conditions of the insurance contract, the nature of the liabilities insured against and the premium paid cannot
be disclosed.
•
No indemnity has been paid to auditors.
P a g e | 21
ANNUAL REPORT
30 June 2020
Directors' report
10. Options
10.1 Unissued shares under option
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
At the date of this report, the un-issued ordinary shares of Calidus Resources Limited under option (listed and unlisted) are
as follows:
Grant Date
Date of Expiry
Exercise Price
Number under Option
18 April 2017
18 April 2021
$0.20
25 November 2019
25 November 2019
25 November 2019
25 November 2019
25 November 2019
4 June 2020
5 August 2020
27 Dec 2021
27 Dec 2023
27 Dec 2024
30 Jan 2022
30 Jan 2025
4 June 2025
5 August 2025
12 August 2020
12 August 2025
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
4,200,000
388,500
500,000
7,150,000
150,000
2,700,000
500,000
600,000
170,000
16,358,500
No person entitled to exercise the option has or has any right by virtue of the option to participate in any share issue of any
other body corporate.
P a g e | 22
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Directors' report
10.2
Shares issued on exercise of options
ANNUAL REPORT
30 June 2020
During or since the end of the financial year, the Company issued ordinary shares as a result of the exercise of options as
follows (there were no amounts unpaid on the shares issued):
Grant Date
Issued price of
the shares
Number of
shares issued
Prior to 10:1 share consolidation:
21-Aug-19
22-Aug-19
10-Sep-19
Post 10:1 share consolidation:
1-May-20
14-May-20
26-May-20
26-May-20
26-May-20
27-May-20
27-May-20
4-June-20
4-June-20
12-June-20
12-June-20
12-June-20
13-Aug-20
$0.025
$0.020
$0.025
$0.25
$0.25
$0.25
$0.20
$0.30
$0.30
$0.25
$0.25
$0.20
$0.25
$0.20
$0.30
Nil
4,000,000
2,000,000
750,000
25,000
100,000
1,175,000
200,000
600,000
500,000
425,000
700,000
200,000
150,000
200,000
500,000
200,000
11. Non-audit services
No non-audit services were provided to the Company during or since the end of the financial year.
12. Proceedings on behalf of company
No person has applied for leave of Court to bring proceedings on behalf of the Company or intervene in any proceedings to
which the Company is a party for the purpose of taking responsibility on behalf of the Company for all or any part of those
proceedings.
The Company was not a party to any such proceedings during the year.
13. Auditor’s independence declaration
The lead auditor's independence declaration under section 307C of the Corporations Act 2001 (Cth) for the year ended 30
June 2020 has been received and can be found on page 33 of the annual report.
P a g e | 23
ANNUAL REPORT
30 June 2020
Directors' report
14. Remuneration report (audited)
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
The information in this remuneration report has been audited as required by s308(3C) of the Corporations Act 2001.
14.1
Key management personnel (KMP)
KMP have authority and responsibility for planning, directing and controlling the activities of the Group. KMP
comprise the directors of the Company and key executive personnel:
•
•
•
•
•
•
Mr David Reeves
Mr Mark Connelly
Mr Keith Coughlan
Mr Adam Miethke
Mr Paul Brennan
Mr Richard Hill
Managing Director
Non-executive Chairman
Non-executive Director
Non-executive Director (Resigned on 27 July 2020)
Chief Operating Officer
Chief Financial Officer (Appointed on 25 November 2019)
14.2
Principles used to determine the nature and amount of remuneration
The remuneration policy of the Company has been designed to ensure reward for performance is competitive and
appropriate to the result delivered. The framework aligns executive reward with the creation of value for
shareholders and conforms to market best practice. The Board ensures that director and executive reward satisfies
the following key criteria for good reward government practices:
•
•
•
•
•
Competitiveness and reasonableness;
Acceptability to the shareholder;
Performance;
Transparency; and
Capital management.
The remuneration policy has been tailored to increase the direct positive relationship between shareholders'
investment objectives and directors' and executives' performance. Currently, this is facilitated through the issues
of options to the majority of directors and executives to encourage the alignment of personal and shareholder
interests. The Company believes this policy will be effective in increasing shareholder wealth. The Board's policy for
determining the nature and amount of remuneration for Board members and senior executive of the Company is
as follows:
a.
Executive Directors and other Senior Executives
The Company’s remuneration policy for executive directors and senior management is designed to promote
superior performance and long-term commitment to the Company. Executives receive a base remuneration
which is market related, and may receive performance based remuneration. The Board reviews executive
packages annually by reference to the Company's performance, executive performance, and comparable
information from industry sectors and other listed companies in similar industries. Executives are also
entitled to participate in employee share and option schemes.
Given the developments in, and evolvement of the Company to date, the Board appointed a firm of
independent remuneration advisors to review the Company’s remuneration and incentive plans in October
2019. The review was undertaken to ensure appropriateness of performance conditions (over the short and
long term), vesting scales, targets and gates to the circumstances that are anticipated to prevail over the
measurement period and the expectations of shareholders.
i.
Fixed Remuneration Correction Plan
In October 2019, the Company engaged BDO (WA) Pty Ltd, independent remuneration consultants, to
conduct a market review of the total fixed remuneration (TFR) packages of the Board and senior executives.
The market review identified the Company Total Fixed Remuneration (TFR) packages to be at a discount to
the market median.
In order for the Company to conserve cash as it progresses its activities from the development of its asset
to commercial production, the Company will utilise a 'once-off' equity allocation in the form of zero exercise
price options (i.e. options with a nil exercise price) to ensure that the TFR package is market appropriate i.e.
median. The equity allocation represents equity in lieu of additional salary.
P a g e | 24
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Directors' report
ANNUAL REPORT
30 June 2020
For senior executives, the only vesting condition is that the executive must remain employed with the
Company for a period of 12 months at which time the options will vest (Exec Options).
A good leaver policy will apply to fixed remuneration options and the options are to be issued under the
Company's Employee Securities Incentive Plan (ESIP), the terms of which are summarised in the Company's
2017 notice of annual general meeting, announced on ASX on 29 September 2017. The fixed remuneration
correction plan therefore has a retentive benefit as well as ensuring that senior executives and non-
executive directors are remunerated at market related rates.
ii.
Discretionary Salary Reduction in return for Shares Rights
During the financial year, the Company initiated various cash preservation measures in March at the start
of the COVID-19 pandemic to ensure it was funded through to a final investment decision on the
Warrawoona Gold Project. This includes various directors, senior staff and consultants electing to take part
of their pay in the form of securities.
The Company has invited director David Reeves (subject to shareholder approval), Paul Brennan and Richard
Hill to participate in a discretionary salary reduction in return for rights to acquire shares (Share Rights) to
be granted under the ESIP, whereby they may elect to accrue up to 50% of their salary (Reduced Amount)
from 1 April to 30 June 2020. The number of rights was determined with reference to the VWAP for the
month of April 2020.
The rationale for inviting the director and executives to participate in a discretionary salary reduction in
return for Share Rights is to preserve cash within the Company, strengthen the Company's balance sheet,
align directors' remuneration with the Company's and shareholders' objectives, and to provide directors
and executives with an incentive to enhance shareholder value.
b.
Non-Executive Directors
The Company's Constitution provides that directors are entitled to be remunerated for their services as
follows:
•
The total aggregate fixed sum per annum to be paid to the directors (excluding salaries of executive
directors) from time to time will not exceed the sum determined by the shareholders in general
meeting and the total aggregate fixed sum will be divided between the directors as the directors
shall determine and, in default of agreement between them, then in equal shares.
The directors' remuneration accrues from day to day.
•
The directors are entitled to be paid reasonable travelling, accommodation and other expenses incurred by
them respectively in or about the performance of their duties as directors.
Notwithstanding the aforementioned, and based on advice from an independent remuneration expert, the
remuneration structure for Non-Executive Directors represents the following structure:
•
•
•
Annual board fees;
Committee fees; and
Equity based fees (in lieu of fixed fees).
The equity-based fees to be considered for non-executive directors will not be subject to performance
conditions. This will be in-line with best practice governance standards, including the ASX Corporate
Governance Council’s Principles.
i.
Fixed Remuneration Correction Plan
In October 2019, the Company engaged an independent remuneration expert to conduct a market review
of the TFR packages of the Board and senior executives. The market review identified the Company TFR
packages to be at a discount to the market median.
P a g e | 25
ANNUAL REPORT
30 June 2020
Directors' report
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
In order for the Company to conserve cash as it progresses its activities from the development of its asset
to commercial production, the Company will utilise a 'once-off' equity allocation in the form of zero exercise
price options (i.e. options with a nil exercise price) to ensure that the TFR package is market appropriate i.e.
median. The equity allocation represents equity in lieu of additional salary.
For non-executive directors, the only vesting condition is that the non-executive director must remain with
the Company for a period of 3 years, with a third of the options vesting each year (NED Options).
A good leaver policy will apply to NED Options and the options are to be issued under the Company's
Employee Securities Incentive Plan (ESIP), the terms of which are summarised in the Company's 2017 notice
of annual general meeting, announced on ASX on 29 September 2017. The fixed remuneration correction
plan therefore has a retentive benefit as well as ensuring that non-executive directors are remunerated at
market related rates.
ii.
Discretionary Fees Reduction in return for Shares Rights
During the financial year, the Company initiated various cash preservation measures in March at the start
of the COVID-19 pandemic to ensure it was funded through to a final investment decision on the
Warrawoona Gold Project. This includes various directors, senior staff and consultants electing to take part
of their pay in the form of Securities.
The Company has, subject to Shareholder approval, invited Mark Connelly and former director Adam
Miethke to participate in a discretionary salary reduction in return for rights to acquire Shares (Share Rights)
to be granted under the ESIP, whereby they may elect to accrue up to 50% of their salary (Reduced Amount)
from 1 April to 30 June 2020.
The rationale for inviting the directors to participate in a discretionary salary reduction in return for Share
Rights is to preserve cash within the Company, strengthen the Company's balance sheet, align directors'
remuneration with the Company's and shareholders' objectives, and to provide directors with an incentive
to enhance shareholder value.
c.
Fixed Remuneration
Other than statutory superannuation contribution, no retirement benefits are provided for executive and
non-executive directors of the Company. To align directors' interests with shareholder interests, the
directors are encouraged to hold shares in the company.
d.
Incentive Plan Arrangements for Executive Directors and Senior Executives
The Company does not have a defined cash-based incentive plan. As the Company is a non-producer, and in
order to limit its outgoings, the Board wishes to conserve and utilise its cash holdings in the most effective
manner possible. In addition, to ensure the executive directors and senior executives have the ability to
participate in the value that is being created and delivered an allocation of zero exercise price options are
issued under the terms of the ESIP (Incentive Options).
The Incentive Options will expire 5 years from the date of grant and will vest subject to the relevant
executive director or senior executive remaining employed by the Company at the date of vesting, and:
(i) half of the Incentive Options will vest upon the latter of the following:
(a) the Company announcing successful completion of a positive definitive feasibility study for the
Warrawoona Gold Project (DFS); and
(b) the Company announcing that it has acquired the approvals and permits required to commence
construction of the mine on the Warrawoona Gold Project from the Environmental Protection
Authority, the Department of Mines, Industry Regulation and Safety, and the Department of the
Environment and Energy; and
(ii)
subject to the vesting of the first half of the Incentive Options, the second half of the Incentive
Options will vest upon the Company announcing that first gold pour has been achieved at the Warrawoona
Gold Project.
P a g e | 26
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Directors' report
e.
Service Contracts
ANNUAL REPORT
30 June 2020
Remuneration and other terms of employment for the directors and KMP are formalised in contracts of
service.
f.
Engagement of Remuneration Consultants
During the financial year, the Company engaged BDO (WA) Pty Ltd, independent remuneration consultants,
to review its existing remuneration policies and provide recommendations on how to improve both the fixed
remuneration and performance based remuneration (both short term and long term incentive) programs.
BDO (WA) Pty Ltd was paid $12,500 for these services.
g.
Relationship between Remuneration of KMP and Earnings
The Board does not consider earnings during the current and previous financial years when determining the
nature and amount of remuneration of KMP as the Company is a non-producer.
14.3 Directors and KMP remuneration
Details of the remuneration of the directors and KMP of the Group (as defined in AASB 124 Related Party
Disclosures) are set out in the following table.
The amounts disclosed for the 2020 financial year in the table represents remuneration paid to the Group over the
financial year ended 30 June 2020 and 30 June 2019.
2020 – Group
Group KMP
David Reeves
Mark Connelly
Keith Coughlan
Adam Miethke
Paul Brennan (i)
Richard Hill (ii)
Short-term benefits
Post-employment
benefits
Share-based payments
Total
% of
Remunera-
tion as
equity-based
payments
Salary, fees
and leave
Other
Super-
annuation
Other
Share
Rights(iii)
Options and
Performance
Rights(vi)
$
240,278
$
$
36,830(iv)
$
517,733
$
240,625
52,500
24,000
22,200
210,000
101,625
650,950
$
-
-
-
-
-
-
-
$
-
5,700
-
-
22,800
12,504
41,004
-
-
-
-
-
-
-
8,170(iv)
12,531
78,901
-
8,354
32,354
2,539(iv)
8,354
33,093
37,500(v)
324,914
595,214
31,071(v)
235,544
380,744
116,110
829,975 1,638,039
54%
26%
26%
33%
61%
70%
(i)
(ii)
(iii)
(iv)
(v)
(vi)
Appointed on 12 March 2019
Appointed on 25 November 2019
In return for their agreement to reduce their salary, the Company has agreed to grant each of the senior executives and
directors (or their respective nominees) Share Rights under the ESIP. Each Share Right will entitle the holder to acquire one
Share in the Company. The deemed issue price for the Share Rights is $0.28 each, which represents the VWAP for the month of
April 2020 and which is the same deemed issue price of Shares issued to other unrelated staff and service providers of the
Company. The Share Rights immediately vest on the grant date and expire 24 months from the grant date.
The shareholders approved the share issuance on 1 September 2020. Shares were issued on 2 September. Refer to ASX
Announcement dated 2 September 2020.
Shares were issued on 1 July 2020. Refer to ASX Announcement dated 1 July 2020.
Only Paul Brennan was granted performance rights.
P a g e | 27
ANNUAL REPORT
30 June 2020
Directors' report
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
2019 – Group
Group KMP
Short-term benefits
Post-employment
benefits
Share-based payments
Total
Salary, fees
and leave
Other
Super-
annuation
Other
David Reeves
Mark Connelly
Keith Coughlan
$
275,000
60,000
24,000
Peter Hepburn-Brown (vii)
4,200
Adam Miethke
James Carter(viii)
Paul Brennan
24,000
27,500
74,286
488,986
$
-
-
-
-
-
-
-
-
$
-
5,700
-
-
-
-
7,057
12,757
(vii)
(viii)
(ix)
Deceased 2 September 2018
Resigned 21 September 2018
Only Paul Brennan was granted performance rights.
$
-
-
-
-
-
-
-
-
Equity-
settled
shares
$
-
Equity -
settled
options and
rights(ix)
$
15,556
290,556
133,818
-
199,518
-
-
-
21,653
12,963
36,963
-
15,556
-
4,200
39,556
49,153
-
20,175
101,518
155,471
64,250
721,464
% of
Remunera-
tion as
equity-based
payments
$
5.0%
67.0%
35.0%
-%
39.0%
44.0%
20%
14.4
Service agreements
Name
Mr David
Reeves
Employing
Company
Calidus
Resources
Limited
Base Salary/Fees
Terms of
Agreement
Termination Notice
Period
Consultancy fees of $275,000 per
annum plus GST(a)
Until
terminated.
Mr Paul
Brennan
Keras (Pilbara)
Gold Pty Ltd(b)
Base salary of $240,000 per annum
plus superannuation of 9.5%
Until
terminated.
Mr Richard
Hill (c)
Calidus
Resources
Limited
25 November 19 to 31 January 20:
A day rate of $1,150 per day plus
superannuation of 9.5%
Until
terminated.
Following 31 January 20:
Base salary of $240,000 per annum
plus superannuation of 9.5%
3 months in writing by
either party or
termination payment
equal to 3 months
consultancy fees.
3 months in writing by
either party or
termination payment
equal to 3 months of
the base salary.
6 months in writing by
either party or
termination payment
equal to 6 months of
the base salary.
(a)
In the event of a change in control (which occurs when a person’s voting power in the Company increases
above 50%), Mr Reeves will receive a bonus payment equal to 12 months Consultancy Fee. However, this
bonus will not be payable if, within 6 months after the change of control, either the Consultant or the Company
terminates the consultancy in accordance with the ECA.
(b) A wholly owned subsidiary of Calidus Resources Limited. Refer to Note 18.
(c) Appointed on 21 November 2019. In the event of a change in control (which occurs when a person’s voting
power in the Company increases above 50%), the employee will receive a bonus payment equal to 6 months
base salary. However, this bonus will not be payable if, within 6 months after the change of control, either the
employee or the Company terminates the agreement in accordance with the agreement.
P a g e | 28
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Directors' report
a.
Non-executive Director Agreements
ANNUAL REPORT
30 June 2020
The Company entered into separate Non-executive Director letter agreement with each of Mr Connelly, Mr
Coughlan and Mr Miethke.
The Company has agreed to pay Mr Connelly a director fee of $60,000 plus superannuation per year for
services provided to the Company as Non-executive Chairman.
The Company has agreed to pay Mr Coughlan and Mr Miethke director fees of $24,000 each including
superannuation per year for services provided to the Company as Non-executive Director.
14.5
Share-based compensation
Issue of shares
No shares were issued to directors and other key management personnel as part of compensation during the year
ended 30 June 2020.
Share Rights
In return for their agreement to reduce their salary, the Company has agreed to grant each of the senior executives
and directors (or their respective nominees) Share Rights under the ESIP. Each Share Right will entitle the holder to
acquire one Share in the Company. The deemed issue price for the Share Rights is $0.28 each, which represents the
VWAP for the month of April 2020 and which is the same deemed issue price of Shares issued to other unrelated
staff and service providers of the Company. The Share Rights immediately vest on the grant date and expire 24
months from the grant date.
Share rights granted carry no dividend or voting rights.
The terms and conditions of each grant of share rights over ordinary shares affecting remuneration of directors and
other key management personnel in this financial year or future reporting years are as follows:
Name
Number of share rights
granted
Deemed grant
date
Share price at grant date
Expiry date
David Reeves1
Mark Connelly1
Keith Coughlan
Adam Miethke1
Paul Brennan2
Richard Hill2
7-May 20
5-May-20
-
26-May-20
20-May-20
8-May-20
1 The shareholders approved the share issuance on 1 September 2020. Shares were issued on 2 September. Refer to ASX
Announcement dated 2 September 2020.
2 Shares were issued on 1 July. Refer to ASX Announcement dated 1 July 2020.
7-May 22
5-May-22
-
26-May-22
20-May-22
8-May-22
122,768
26,786
-
6,429
107,143
107,143
$0.300
$0.305
-
$0.395
$0.350
$0.290
Options
The terms and conditions of each grant of options over ordinary shares affecting remuneration of directors and
other key management personnel in this financial year or future reporting years are as follows:
NED Options and Exec Options
Name
Number of
options granted
Grant date
Vesting date and
exercisable date
Expiry date
Exercise
price
David Reeves
Mark Connelly
Keith Coughlan
Adam Miethke1
Paul Brennan
Richard Hill
1 On 27 July 2020, the Board resolved that it will permit all of the NED Options issued to Adam Miethke will vest under a good
leaver exception and that Adam Miethke will have one month to exercise these options.
25-Nov-19
25-Nov-19
25-Nov-19
25-Nov-19
25-Nov-19
29-Jan-20
24-Nov-20
24-Nov-22
24-Nov-22
27-Jul-20
24-Nov-20
28-Jan-21
27-Dec-21
27-Dec-23
27-Dec-23
27-Aug-20
27-Dec-21
30-Jan-22
150,000
300,000
200,000
200,000
150,000
150,000
Nil
Nil
Nil
Nil
Nil
Nil
Fair value per
option at grant
date
$0.21
$0.21
$0.21
$0.21
$0.21
$0.26
P a g e | 29
ANNUAL REPORT
30 June 2020
Directors' report
Incentive options
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Name
Number of
options granted
Grant date
Vesting date1 and
exercisable date
Expiry date
Exercise
price
David Reeves
David Reeves
Paul Brennan
Paul Brennan
Richard Hill
Richard Hill
1,500,000
1,500,000
1,350,000
1,350,000
1,350,000
1,350,000
25-Nov-19
25-Nov-19
25-Nov-19
25-Nov-19
29-Jan-20
29-Jan-20
30-Sep-20
-
30-Sep-20
-
30-Sep-20
-
27-Dec-24
27-Dec-24
27-Dec-24
27-Dec-24
30-Jan-25
30-Jan-25
Nil
Nil
Nil
Nil
Nil
Nil
Fair value per
option at grant
date
$0.21
$0.21
$0.21
$0.21
$0.26
$0.26
1As at reporting date, the probability of achievement of the milestones (detailed in Section 14.2d) and the first of
the options are deemed to be 100% with estimated achievement date on 30 September 2020. No value was
expensed for second half of the options during the year as the probability of achievement of the milestone as at 30
June 2020 was less than 50%.
Options granted carry no dividend or voting rights.
All options were granted over unissued fully paid ordinary shares in the company. The number of options granted
was determined having regard to the satisfaction of performance measures and weightings as described above in
the section 'Note 17: Share based payments'. Options vest based on the provision of service over the vesting period
whereby the executive becomes beneficially entitled to the option on vesting date. Options are exercisable by the
holder as from the vesting date. There has not been any alteration to the terms or conditions of the grant since the
grant date. There are no amounts paid or payable by the recipient in relation to the granting of such options other
than on their potential exercise.
14.6 Additional disclosures relating to the key management personnel
a.
Fully paid ordinary shares of Calidus Resources Limited held by each KMP
2020 – Group
Group KMP
David Reeves
Mark Connelly
Keith Coughlan
Adam Miethke
Paul Brennan
Richard Hill
Balance at
start of year
No.
17,757,903
5,000,000
4,440,000
-
5,000,000
-
32,197,903
Received during
the year as
compensation
No.
-
-
-
-
-
-
-
Received during
the year on
the exercise of
options
No.
500,000
-
500,000
-
-
-
1,000,000
Other changes
during the year
No.
143,895,735
-
-
-
Consolidation
No.
(145,159,439)
(4,500,000)
(3,996,000)
-
(2,150,000)
(2,700,000)
-
141,745,735
-
(156,355,439)
Balance at
end of year
No.
16,994,200
500,000
944,000
-
150,000
-
18,588,200
b.
Share rights in Calidus Resources Limited held by each KMP
2020 – Group
Group KMP
David Reeves
Mark Connelly
Keith Coughlan
Adam Miethke
Paul Brennan
Richard Hill
Balance at
start of year
No.
-
-
-
-
-
-
-
Received during
the year as
compensation
No.
122,768
26,786
-
6,429
107,143
107,143
370,269
Other changes
during the year
No.
-
-
-
-
-
-
Consolidation
No.
-
-
-
-
-
-
-
-
Balance at
end of year
No.
122,768
26,786
-
6,429
107,143
107,143
370,269
P a g e | 30
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Directors' report
ANNUAL REPORT
30 June 2020
c.
Options in Calidus Resources Limited held by each KMP
2020 – Group
Group KMP
David Reeves
Mark Connelly
Keith Coughlan
Adam Miethke
Paul Brennan
Richard Hill
Balance at
start of year
No.
5,000,000
-
5,000,000
6,000,000
-
-
16,000,000
Granted as
Remuneration
during the year
No.
150,000
300,000
200,000
200,000
150,000
150,000
1,150,000
Exercised
during the year
No.
(500,000)
-
(500,000)
-
(1,000,000)
Other changes
during the year
No.
3,000,000
(600,000)
2,700,000
2,700,000
7,800,000
Consolidation
No.
(4,500,000)
(4,500,000)
(5,400,000)
-
-
(14,400,000)
Balance at
end of year
No.
3,150,000
300,000
200,000
200,000
2,850,000
2,850,000
9,550,000
Vested and
Exercisable
No.
-
-
-
-
-
-
-
Not Vested
No.
3,150,000
300,000
200,000
200,000
2,850,000
2,850,000
9,550,000
d.
Performance rights in Calidus Resources Limited held by each KMP
2020 – Group
Group KMP
Paul Brennan
Balance at
start of year
No.
9,000,000
9,000,000
Granted as
Remuneration
during the year
No.
-
-
Exercised
during the year
No.
-
-
Other changes
during the year
No.
-
-
Consolidation
No.
(8,100,000)
(8,100,000)
Balance at
end of year
No.
900,000
900,000
Vested and
Exercisable
No.
900,000
900,000
Not Vested
No.
-
-
14.7 Other transactions with KMP and or their related parties
During the 2020 financial year, the Group incurred the following amounts to related parties:
•
Office Rent
Wilgus Investments Pty Ltd and Wild West Enterprises Pty Ltd
$81,961* (30 June 2019: $62,300)
Calidus and Wilgus Investments Pty Ltd entered into a sub-lease agreement in respect of a portion of the
office space at 12/11 Ventnor Avenue, West Perth (Office Lease Agreement). Mr Reeves (Managing Director
of the Company) is a director of Wilgus Investments Pty Ltd and Wild West Enterprises Pty Ltd.
The rent payable by Calidus under the Office Lease Agreement is:
a. From July – August 2019: $6,100 per month payable in advance; and
b. From Sept to June 2020: $7,100 per month payable in advance.
* During the financial year, the Company initiated various cash preservation measures in March at the start
of the COVID-19 pandemic to ensure it was funded through to a final investment decision on the Warrawoona
Gold Project. This includes various directors, senior staff and consultants electing to take part of their pay or
fees in the form of Securities.
The Company has, subject to Shareholder approval, invited Wild West Enterprises Pty Ltd to participate in a
fee reduction in return for fully paid ordinary shares (Shares), whereby Wild West Enterprises has accrued
50% of its monthly office rental fee for a period of 3 months from 1 April to 30 June 2020 (Reduced Amount).
In return for the agreed Reduced Amount, the Company has agreed to issue Wild West Enterprises (or its
nominees) 38,036 Shares. The value of the shares was $11,411 at the valuation date. The shares were
approved by Shareholder on 1 September 2020.
P a g e | 31
ANNUAL REPORT
30 June 2020
Directors' report
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
•
Consulting Fees - Discovery Capital Partners Pty Ltd
$119,679** (30 June 2019: $170,000)
The Group paid Corporate Advisory and Capital Raising fees to Discovery Capital Partners Pty Ltd of $119,679
during the year ended 30 June 2020 (30 June 2019: $170,000). Mr Miethke is a director of Discovery Capital.
The Board considers that the Discovery Capital engagement to be on arms’ length and commercial terms.
** During the financial year, the Company initiated various cash preservation measures in March at the start
of the COVID-19 pandemic to ensure it was funded through to a final investment decision on the Warrawoona
Gold Project. This includes various directors, senior staff and consultants electing to take part of their pay in
the form of Securities.
The Company has, subject to Shareholder approval, invited Discovery Capital Partners Pty Ltd to participate
in a fee reduction in return for fully paid ordinary shares (Shares), whereby Discovery Capital Partners Pty Ltd
has accrued 50% of its monthly office rental and outgoings fee for a period of 3 months from 1 April to 30
June 2020 (Reduced Amount).
In return for the agreed Reduced Amount, the Company has agreed to issue Discovery Capital Partners Pty
Ltd 32,143 Shares. The value of the shares was $8,679 at the valuation date. The shares were
approved by Shareholder on 1 September 2020.
Refer also Note 20 Related party transactions.
END OF REMUNERATION REPORT
This Report of the directors, incorporating the Remuneration Report, is signed in accordance with a resolution of directors
made pursuant to s.298(2) of the Corporations Act 2001 (Cth).
MARK CONNELLY
Non-executive Chairman
Dated this Friday, 11 September 2020
P a g e | 32
Moore Australia Audit (WA)
Level 15, Exchange Tower,
2 The Esplanade, Perth, WA 6000
PO Box 5785, St Georges Terrace, WA 6831
T +61 8 9225 5355
F +61 8 9225 6181
www.moore-australia.com.au
AUDITOR’S INDEPENDENCE DECLARATION
UNDER SECTION 307C OF THE CORPORATIONS ACT 2001
TO THE DIRECTORS OF CALIDUS RESOURCES LIMITED
As lead auditor of Calidus Resources Limited, I declare, that to the best of my knowledge and belief,
during the financial year ended 30 June 2020, there have been:
(i) no contraventions of the auditor independence requirements as set out in the Corporations Act
2001 in relation to the audit; and
(ii) no contraventions of any applicable code of professional conduct in relation to the audit.
This declaration is in respect of Calidus Resources Limited and the entities it controlled during the
financial year.
SL TAN
PARTNER
MOORE AUSTRALIA AUDIT (WA)
CHARTERED ACCOUNTANTS
Signed at Perth this 11th day of September 2020.
Moore Australia Audit (WA) – ABN 16 874 357 907.
An independent member of Moore Global Network Limited - members in principal cities throughout the world.
Liability limited by a scheme approved under Professional Standards Legislation.
P a g e | 33
ANNUAL REPORT
30 June 2020
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Consolidated statement of profit or loss and other comprehensive income
for the year ended 30 June 2020
Note
30 June 2020
$
30 June 2019
$
Continuing operations
Revenue
Other income
Compliance costs
Depreciation and amortisation
Employment costs
Exploration and evaluation expenditure
Finance costs
Insurance fees
Exploration expenditure written off
Legal and consulting fees
Occupancy costs
Share-based payments
Share registry and listing fees
Travel and accommodation
Other expenses
Unrealised profit / (loss) on Pacton shares
Foreign exchange loss
Profit / (loss) before tax
Income tax benefit / (expense)
Net profit / (loss) for the year
Other comprehensive income, net of income tax
3a
3b
4a
11b
363,917
234,381
3,691,174
84,980
598,298
3,776,154
(421,947)
(62,560)
(703,694)
(25,453)
(1,503)
(75,075)
(163,643)
(160,918)
(74,316)
(580,035)
(60,200)
(512,401)
(2,320)
(21,615)
(41,983)
(15,000)
(83,705)
(65,224)
(634,532)
(100,625)
(84,825)
(408,566)
17
(1,129,850)
(102,132)
(52,895)
236,041
4b
45,368
(2,405,866)
(66)
(1,974)
(2,094,345)
(1,242,718)
5
-
-
(2,094,345)
(1,242,718)
-
-
Other comprehensive income for the year, net of tax
(2,094,345)
(1,242,718)
Total comprehensive income attributable to members of the parent entity
(2,094,345)
(1,242,718)
Earnings per share:
Basic and loss per share (cents per share)
₵
₵
6c
(0.01)
(0.09)
The consolidated statement of profit or loss and other comprehensive income is to be read in conjunction with the accompanying notes.
P a g e | 34
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Consolidated statement of financial position
as at 30 June 2020
Current assets
Cash and cash equivalents
Trade and other receivables
Financial assets
Other
Total current assets
Non-current assets
Plant and equipment
Exploration and evaluation assets
Other non-current assets
Total non-current assets
Total assets
Current liabilities
Trade and other payables
Short-term provisions
Total current liabilities
Total liabilities
Net assets
Equity
Issued capital
Reserves
Accumulated losses
Total equity
ANNUAL REPORT
30 June 2020
Note
30 June 2020
$
30 June 2019
$
7
8
9a
9b
10
11
5,690,661
4,145,369
261,695
307,782
1,362,119
1,275,245
43,669
-
7,358,144
5,728,396
696,763
114,309
24,329,686
18,145,519
24,993
24,993
25,051,442
18,284,821
32,409,586
24,013,217
12
13
1,338,107
1,876,611
48,219
151,123
1,386,326
2,027,734
1,386,326
2,027,734
31,023,260
21,985,483
14a
16
39,714,679
29,712,407
1,910,237
780,387
(10,601,656)
(8,507,311)
31,023,260
21,985,483
The consolidated statement of financial position is to be read in conjunction with the accompanying notes.
P a g e | 35
ANNUAL REPORT
30 June 2020
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Consolidated statement of changes in equity
for the year ended 30 June 2020
Note
Issued
Capital
$
Employee
Shares
$
Reserve
$
Accumulated
Losses
$
Total
$
Balance at 1 July 2018
21,712,043
414,029
170,855
(7,264,593)
15,032,334
Loss for the year attributable owners of the parent
Other comprehensive income for the year attributable
owners of the parent
Total comprehensive income for the year attributable
owners of the parent
-
-
-
Transaction with owners, directly in equity
Shares issued during the year
Share based payments
7,820,047
-
17
-
-
-
-
-
-
Employee shares issued during the year
14e/15
439,029
(414,029)
14a
(258,712)
Transaction costs
Balance at 30 June 2019
Balance at 1 July 2019
29,712,407
29,712,407
-
-
-
Loss for the year attributable owners of the parent
Other comprehensive income for the year attributable
owners of the parent
Total comprehensive income for the year attributable
owners of the parent
,
Transaction with owners, directly in equity
Shares issued during the year
Share based payments
Transaction costs
Balance at 30 June 2020
17
14a
10,557,000
-
(554,728)
39,714,679
-
(1,242,718)
(1,242,718)
-
-
-
609,532
-
-
-
-
(1,242,718) (1,242,718)
-
-
-
-
7,820,047
609,532
25,000
(258,712)
780,387
(8,507,311)
21,985,483
780,387
(8,507,311)
21,985,483
-
-
-
1,129,850
-
(2,094,345)
(2,094,345)
-
-
-
(2,094,345) (2,094,345)
-
10,557,000
-
-
1,129,850
(554,728)
1,910,237
(10,601,656)
31,023,260
-
-
-
-
-
-
-
-
-
-
-
The consolidated statement of changes in equity is to be read in conjunction with the accompanying notes.
P a g e | 36
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Consolidated statement of cash flows
for the year ended 30 June 2020
Cash flows from operating activities
Receipts from customers
Payments for suppliers and employees
Interest received
ANNUAL REPORT
30 June 2020
Note
30 June 2020
$
30 June 2019
$
33,500
10,063
(1,865,629)
(2,837,498)
74,071
84,980
Net cash used in operating activities
7c
(1,758,058)
(2,742,455)
Cash flows from investing activities
Payments for exploration expenditure
Proceeds from Pacton share sales
Purchase of plant and equipment
Net cash used in investing activities
Cash flows from financing activities
Proceeds from issue of shares
Payments for capital raising costs
Net cash provided by financing activities
(6,240,149)
(6,851,690)
322,410
-
(645,014)
(14,131)-
(6,562,753)
(6,865,821)
10,402,500
7,786,687
(536,397)
(175,289)
9,866,103
7,611,398
Net (decrease)/increase in cash held
1,545,292
(1,996,878)
Cash and cash equivalents at the beginning of the year
4,145,369
6,142,247
Cash and cash equivalents at the end of the year
7b
5,690,661
4,145,369
The consolidated statement of cash flows is to be read in conjunction with the accompanying notes.
.
P a g e | 37
ANNUAL REPORT
30 June 2020
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Notes to the consolidated financial statements
for the year ended 30 June 2020
Statement of significant accounting policies
Note 1
These are the consolidated financial statements and notes of Calidus Resources Limited (Calidus or the Company) and controlled
entities (collectively the Group). Calidus is a company limited by shares, domiciled and incorporated in Australia.
The separate financial statements of Calidus, as the parent entity, have not been presented with this financial report as permitted
by the Corporations Act 2001 (Cth).
The financial statements were authorised for issue on 11 September 2020 by the directors of the Company.
a. Basis of preparation
The financial statements comprise the consolidated financial statements of the Group. For the purposes of preparing the
consolidated financial statements, the Company is a for-profit entity. Material accounting policies adopted in the preparation of
these financial statements are presented below. They have been consistently applied unless otherwise stated.
i. Statement of compliance
These financial statements are general purpose financial statements which have been prepared in accordance with Australian
Accounting Standards and Interpretations of the Australian Accounting Standards Board (AASB) and International Financial
Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB), and the Corporations Act 2001
(Cth).
Australian Accounting Standards (AASBs) set out accounting policies that the AAS Board has concluded would result in a financial
report containing relevant and reliable information about transactions, events and conditions to which they apply. Compliance
with AASBs ensures that the financial statements and notes also comply with IFRS as issued by the IASB.
ii. Use of estimates and judgments
The preparation of consolidated financial statements requires management to make judgements, estimates and assumptions
that affect the application of policies and reported amounts of assets and liabilities, income and expenses. These estimates and
associated assumptions are based on historical experience and various factors that are believed to be reasonable under the
circumstances, the results of which form the basis of making the judgements about carrying values of assets and liabilities that
are not readily apparent from other sources. Actual results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the
period in which the estimate is revised and in any future period affected.
iii. Comparative figures
Where required by AASBs comparative figures have been adjusted to conform with changes in presentation for the current
financial year.
Where the Group retrospectively applies an accounting policy, makes a retrospective restatement or reclassifies items in its
financial statements, an additional (third) statement of financial position as at the beginning of the preceding period in addition
to the minimum comparative financial statements is presented.
b. Accounting Policies
Except where stated below, the Group has consistently applied the following accounting policies to all period presented in the
financial statements. The Group has considered the implications of new and amended Accounting Standards applicable for
annual reporting period beginning after 1 July 2019 as per (d) below.
c. Principles of consolidation
As at the reporting date, the assets and liabilities of all controlled entities have been incorporated into the consolidated financial
statements as well as their results for the year then ended. Where controlled entities have entered (left) the Consolidated Group
during the year, their operating results have been included (excluded) from the date control was obtained (ceased).
i. Business combinations
Business combinations are accounted for using the acquisition method as at the acquisition date, which is the date on
which control is transferred to the Group. Control exists when the Group is exposed to variable returns from another
entity and has the ability to affect those returns through its power over the entity.
P a g e | 38
ANNUAL REPORT
30 June 2020
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Notes to the consolidated financial statements
for the year ended 30 June 2020
Note 1
Statement of significant accounting policies
Notes to the consolidated financial statements
for the year ended 30 June 2020
1 Statement of significant accounting policies
c. Principles of consolidation (continued)
The Group measures goodwill at the acquisition date as:
◼ the fair value of the consideration transferred; plus
◼ the recognised amount of any non-controlling interests in the acquired entity; plus
◼
if the business combination is achieved in stages, the fair value of the existing equity interest in the acquiree;
less
◼ the net recognised amount of the identifiable assets acquired and liabilities assumed.
When the excess is negative, a bargain purchase gain is recognised immediately in profit or loss.
The consideration transferred does not include amounts related to settlement of pre-existing relationships. Such amounts are
generally recognised in profit or loss.
Costs related to the acquisition, other than those associated with the issue of debt or equity securities, that the Group incurs in
connection with a business combination are expensed as incurred.
Any contingent consideration payable is recognised at fair value at the acquisition date. If the contingent consideration is
classified as equity, it is not remeasured and settlement is accounted for within equity. Otherwise, subsequent changes to the
fair value of the contingent consideration are recognised in profit or loss.
ii. Subsidiaries
Subsidiaries are entities controlled by the Group. The financial statements of subsidiaries are included in the consolidated
financial statements from the date that control commences until the date that control ceases.
The accounting policies of subsidiaries have been changed when necessary to align them with the policies adopted by the Group.
Losses applicable to the non-controlling interests in a subsidiary are allocated to the non-controlling interests even if doing so
causes the non-controlling interests to have a deficit balance.
A list of controlled entities is contained in Note 18 Controlled Entities of the financial statements.
iii. Loss of control
Upon the loss of control, the Group derecognises the assets and liabilities of the subsidiary, any non-controlling interests and the
other components of equity related to the subsidiary. Any surplus or deficit arising on the loss of control is recognised in profit
or loss. If the Group retains any interest in the previous subsidiary, then such interest is measured at fair value at the date control
is lost. Subsequently it is accounted for as an equity-accounted investee or as an available-for-sale financial asset depending on
the level of influence retained.
iv. Transactions eliminated on consolidation
All intra-group balances and transactions, and any unrealised income and expenses arising from intra-group transactions, are
eliminated in preparing the consolidated financial statements.
P a g e | 39
ANNUAL REPORT
30 June 2020
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Notes to the consolidated financial statements
for the year ended 30 June 2020
Note 1 Statement of significant accounting policies
d.
Application of New and Revised Accounting Standards
The Group has considered the implications of new or amended Accounting Standards which have become applicable for the
current financial reporting year and the group had to change its accounting policies as a result of adopting the following
standard:
AASB 16: Leases
The Group as lessee
At inception of a contract, the Group assesses if the contract contains a lease or is a lease. If there is a lease present, a right-of-
use asset and a corresponding lease liability are recognised by the Group where the Group is a lessee. However, all contracts
that are classified as short-term leases (i.e. a lease with a remaining lease term of 12 months or less) and leases of low-value
assets are recognised as an operating expense on a straight-line basis over the term of the lease.
Initially the lease liability is measured at the present value of the lease payments still to be paid at the commencement date.
The lease payments are discounted at the interest rate implicit in the lease. If this rate cannot be readily determined, the Group
uses the incremental borrowing rate.
Lease payments included in the measurement of the lease liability are as follows:
fixed lease payments less any lease incentives;
•
• variable lease payments that depend on an index or rate, initially measured using the index or rate at the commencement
date;
•
•
•
• payments of penalties for terminating the lease, if the lease term reflects the exercise of an option to terminate the lease.
the amount expected to be payable by the lessee under residual value guarantees;
the exercise price of purchase options, if the lessee is reasonably certain to exercise the options;
lease payments under extension options, if the lessee is reasonably certain to exercise the options; and
The right-of-use assets comprise the initial measurement of the corresponding lease liability, any lease payments made at or
before the commencement date and any initial direct costs. The subsequent measurement of the right-of-use assets is at cost
less accumulated depreciation and impairment losses.
Right-of-use assets are depreciated over the lease term or useful life of the underlying asset, whichever is the shortest.
Where a lease transfers ownership of the underlying asset or the cost of the right-of-use asset reflects that the Group
anticipates to exercise a purchase option, the specific asset is depreciated over the useful life of the underlying asset.
Initial Application of AASB 16: Leases
Based on director’s assessment, the adoption of AASB 16 did not have any impact on the Group as its existing lease contract is
short-term in nature.
ii. Other standards not yet applicable
Any new, revised or amending Accounting Standards or Interpretations that are not yet mandatory have not been early
adopted.
The adoption of these Accounting Standards and Interpretations did not have any significant impact on the financial
performance or position of the company.
There are no other standards that are not yet effective and that would be expected to have a material impact on the entity in
the current or future reporting period and on foreseeable future transactions.
P a g e | 40
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Notes to the consolidated financial statements
for the year ended 30 June 2020
Note 1 Statement of significant accounting policies
ANNUAL REPORT
30 June 2020
e. Critical Accounting Estimates and Judgments
Management discusses with the Board the development, selection and disclosure of the Group's critical accounting policies and
estimates and the application of these policies and estimates. The estimates and judgements that have a significant risk of causing
a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.
i. Key Estimate – Exploration and evaluation expenditure
Exploration and evaluation costs are carried forward where right of tenure of the area of interest is current. Refer to
accounting policy stated in note 11 Exploration and evaluation assets. The carrying value of capitalised expenditure at
reporting date is $24,329,686 (30 June 2019: $18,145,519).
The ultimate recoupment of the value of the exploration and evaluation assets and mine properties is dependent on
successful development and commercial exploitation or alternatively, sale, of the underlying mineral exploration properties.
The Group undertakes at least on an annual basis a comprehensive review for indicators of impairment of these assets. There
is significant estimation and judgement in determining the inputs and assumptions used in determining the recoverable
amounts.
The key areas of estimation and judgement that are considered in this review include:
•
•
•
•
•
•
Recent drilling results and reserves and resource estimates;
Environmental issues that may impact the underlying tenements;
The estimated market value of assets at the review date;
Independent valuations of underlying assets that may be available;
Fundamental economic factors such as gold prices, exchange rates and current and anticipated operating costs in the
industry; and
The Group’s market capitalisation compared to its net assets.
Information used in the review process is rigorously tested to externally available information as appropriate.
ii. Key Estimate —Environmental Issues
Balances disclosed in the financial statements and notes thereto are not adjusted for any pending or enacted environmental
legislation, and the directors understanding thereof. At the current stage of the company’s development and its current
environment impact, the directors believe such treatment is reasonable and appropriate.
iii. Key judgements and estimates – Taxation
Balances disclosed in the financial statements and the notes thereto, related to taxation, are based on the best estimates of
directors. These estimates take into account both the financial performance and position of the company as they pertain to
current income taxation legislation, and the directors understanding thereof. No adjustment has been made for pending or
future taxation legislation. The current income tax position represents that directors' best estimate, pending an assessment
by tax authorities in relevant jurisdictions. Refer Note 5 Income Tax.
iv. Key judgements and estimates – Coronavirus (COVID-19) pandemic
Judgement has been exercised in considering the impacts that the Coronavirus (COVID-19) pandemic has had, or may have,
on the Group based on known information. This consideration extends to the nature of the products and services offered,
customers, supply chain, staffing and geographic regions in which the consolidated entity operates. Other than as addressed
in specific notes, there does not currently appear to be either any significant impact upon the financial statements or any
significant uncertainties with respect to events or conditions which may impact the Group unfavourably as at the reporting
date or subsequently as a result of the Coronavirus (COVID-19) pandemic.
v. 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 internal valuation using a Black-Sholes
model, applying the assumptions detailed in Note 17.
P a g e | 41
ANNUAL REPORT
30 June 2020
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Notes to the consolidated financial statements
for the year ended 30 June 2020
Note 2
Company details
The registered office of the Company is:
Address:
Street:
Postal:
Telephone:
Suite 12, 11 Ventnor Avenue, WEST PERTH WA 6005
PO Box 1240, WEST PERTH WA 6872
+61 (8) 6245 2050
Note 3
Revenue and other income
a. Revenue
Revenue – disposal of conglomerate gold rights
Revenue – additional Pacton shares received
b. Other income
Other
Interest income
2020
$
2019
$
-
3,691,174
363,917
-
363,917
3,691,174
160,310
74,071
234,381
-
84,980
84,980
Included in Other are Cash Flow Boosts received from ATO of $88,588 (2019: Nil).
Revenue
Revenues represent revenue generated from external customers. There were no inter-segment revenues in the current
year.
Revenue from the sale of goods is measured at the fair value of the consideration received or receivable, net of returns and
allowances. Revenue is recognised in the income statement when the significant risks and rewards of ownership have been
transferred to the buyer. No revenue is recognised if there are significant uncertainties regarding recovery of the
consideration due or there is a risk of return of goods or there is continuing management involvement with the goods.
All revenue is stated net of the amount of value added taxes.
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.
Note 4
Profit / (loss) before income tax
The following significant revenue and expense items are relevant in explaining
the financial performance:
a. Employment costs:
◼ Directors fees
◼ Superannuation expenses / (reimbursement)
◼ Wages and salaries
◼ Other employment related costs
2020
$
2019
$
339,325
24,068
247,396
92,905
703,694
386,890
7,202
94,350
23,959
512,401
P a g e | 42
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Notes to the consolidated financial statements
for the year ended 30 June 2020
Note
4 Profit / (loss) before income tax (continued)
b. Other expense:
◼ (Reversal)/Accruals of stamp duty due to settlement
◼ Receipt of fuel tax credit
◼ Other
Note 5
Income tax
a.
Income tax expense / (benefit)
Current tax
Deferred tax
Relating the origination and reversal of temporary differences
Deferred tax expense (benefit) not recognised
Income tax expense (benefit) reported in income statement
b. Reconciliation of income tax expense to prima facie tax payable
The prima facie tax payable / (benefit) on loss from ordinary activities before
income tax is reconciled to the income tax expense as follows:
ANNUAL REPORT
30 June 2020
2020
$
2019
$
(251,939)
363,406
(43,537)
59,435
(9,639)
54,799
(236,041)
408,566
2020
$
2019
$
(2,117,838)
(2,152,075)
2,117,838
2,152,075
139,044
(1,858,671)
(139,044)
1,856,671
-
-
Accounting profit (loss) before tax from continuing operations
Prima facie tax on operating loss at 27.5% (2019: 30%)
(2,094,345)
(1,242,718)
(575,945)
(372,816)
Add / (Less)
Tax effect of:
Non-deductible share-based payments
Non-deductible expenses
Deferred tax asset not brought to account
Income tax expense / (benefit) attributable to operating loss
c. The applicable weighted average effective tax rates attributable to operating
profit are as follows
d. Balance of franking account at year end of the legal parent
310,709
(22,326)
287,562
190,360
1,698
180,758
-
%
-
$
nil
-
%
-
$
nil
P a g e | 43
ANNUAL REPORT
30 June 2020
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Notes to the consolidated financial statements
for the year ended 30 June 2020
Note 5
Income tax (continued)
e. Deferred tax assets
Tax losses
Financial assets
Plant and equipment
Provisions and accruals
Capital raising costs
Unrealised foreign exchange
Note
2020
$
2019
$
10,135,309
8,634,670
500,197
2,314
20,042
435,446
(13)
721,760
16,408
12,801
255,957
592
11,093,296
9,642,188
Set-off deferred tax liabilities
5f
(4,358,471)
(2,768,320)
Net deferred tax assets
Less deferred tax assets not recognised
Net tax assets
f. Deferred tax liabilities
Exploration expenditure
g. Tax losses and deductible temporary differences
Unused tax losses and deductible temporary differences for which no
deferred tax asset has been recognised:
6,734,824
6,873,868
(6,734,824)
(6,873,868)
-
-
4,358,471
4,358,471
2,768,320
2,768,320
36,251,877
28,720,041
36,251,877
28,720,041
Potential deferred tax assets attributable to tax losses have not been brought to account at 30 June 2020 because the directors
do not believe it is appropriate to regard realisation of the deferred tax assets as probable at this point in time. These benefits
will only be obtained if:
the company derives future assessable income of a nature and of an amount sufficient to enable the benefits to be utilised;
(a)
(b) the company continues to comply with the conditions for deductibility imposed by law; and
(c) no changes in income tax legislation adversely affect the company in utilising the benefits.
The corporate tax rate for eligible companies will reduce from 30% to 25% by 30 June 2022 providing certain turnover thresholds
and other criteria are met. Deferred tax assets and liabilities are required to be measured at the tax rate that is expected to
apply in the future income year when the asset is realised or the liability is settled. The directors have determined that the
deferred tax balances be measured at the tax rates stated.
Current tax assets and liabilities for the current and prior period 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:
P a g e | 44
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Notes to the consolidated financial statements
for the year ended 30 June 2020
Note
5
Income tax (continued)
ANNUAL REPORT
30 June 2020
• 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.
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.
P a g e | 45
ANNUAL REPORT
30 June 2020
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Notes to the consolidated financial statements
for the year ended 30 June 2020
Note 6
Earnings per share (EPS)
a. Reconciliation of earnings to profit or loss
(Loss) / profit for the year
2020
$
2019
$
(2,094,345)
(1,242,718)
(Loss) / profit used in the calculation of basic and diluted EPS
(2,094,345)
(1,242,718)
b. Weighted average number of ordinary shares outstanding during the year
used in calculation of basic EPS
c. Earnings per share
Basic EPS (cents per share)
2020
$
2019
$
191,358,195
1,394,677,575
2020
$
2019
$
(0.01)
(0.09)
d. At the end of the 2020 financial year, the Group has 15,788,500 unissued shares under options (2019: 166,500,000 [Pre 10:1 Shares
Consolidation]), 2,100,000 performance rights on issue (2019: 12,000,000 [Pre 10:1 Shares Consolidation]), 497,903 share rights
(2019: nil) and nil performance shares on issue (2019: 275,000,000 [Pre 10:1 Shares Consolidation]). The Group does not report
diluted earnings per share on annual losses generated by the Group. During the 2020 financial year the Group's unissued shares
under option and partly-paid shares were anti-dilutive.
Basic profit/(loss) 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 profit/(loss) 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.
P a g e | 46
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Notes to the consolidated financial statements
for the year ended 30 June 2020
Note 7
Cash and cash equivalents
a. Current
Cash at bank
ANNUAL REPORT
30 June 2020
Note
2020
$
2019
$
5,690,661
4,145,369
5,690,661
4,145,369
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.
The Group's exposure to interest rate risk and a sensitivity analysis for financial assets and liabilities are disclosed in note 23
Financial risk management.
b. Reconciliation of cash
Cash at the end of the financial year as shown in the statement of cash flows
is reconciled to items in the statement of financial position as follows:
◼ Cash and cash equivalents
Note
2020
$
2019
$
5,690,661
4,145,369
5,690,661
4,145,369
c. Cash Flow Information
i. Reconciliation of cash flow from operations to (loss)/profit after income tax
Loss after income tax
(2,094,345)
(1,242,718)
Cash flows excluded from (loss)/profit attributable to operating activities
Non-cash flows in (loss)/profit from ordinary activities:
◼ Depreciation and amortisation
◼ Other
◼ Share-based payments
◼ Exploration write off/Impairment expense
◼ Pacton revaluation
17
62,560
(15,693)
1,129,849
163,643
(409,285)
-
60,200
-
634,532
15,000
-
Changes in assets and liabilities, net of the effects of purchase and disposal of
subsidiaries:
◼ (Increase)/decrease in receivables
◼ (Increase)/decrease in other assets
◼ Increase/(decrease) in trade and other payables
◼ Increase/(decrease) in provisions
Cash flow from operations
2,418
(48,010)
(86,874)
(2,591,983)
(527,523)
17,192
669,957
(239,432)
(1,758,058)
(2,742,455)
P a g e | 47
ANNUAL REPORT
30 June 2020
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Notes to the consolidated financial statements
for the year ended 30 June 2020
Note 7
Cash and cash equivalents (cont)
d. Credit standby facilities
The Group has no credit standby facilities.
e. Non-cash financing activities
016
014
$
There were no non-cash financing activities during the financial year ended 30 June 2020 or the prior year.
Note 8
Trade and other receivables
a. Current
Trade receivables
GST receivable
Expected credit losses
2020
$
36,575
225,120
2019
$
-
307,782
261,695
307,782
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.
Where applicable, in measuring the expected credit losses, the trade receivables are assessed on a collective basis as they possess
shared credit risk characteristics. They are 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 past sales (where applicable) 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.
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 others is considered
indicators of no reasonable expectation of recovery.
Note 9
Other assets
a. Financial assets – fair value through profit or loss
Shares in Pacton Gold Inc. - at fair value
b. Other assets
Prepayments
2020
$
2019
$
1,362,119
1,362,119
1,275,245
1,275,245
43,669
43,669
-
-
P a g e | 48
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Notes to the consolidated financial statements
for the year ended 30 June 2020
Note
10 Property, plant, and equipment
a. Non-current
Motor vehicles
Accumulated depreciation
Computer and software
BAccumulated depreciation
Mining equipment
BAccumulated depreciation
BBuildings
Total plant and equipment
b. Movements in Carrying Amounts
Motor Vehicles
$
Computer and
software
$
Mining
equipment
$
ANNUAL REPORT
30 June 2020
2020
$
76,104
(65,834)
10,270
48,056
(36,000)
12,056
87,951
(52,635)
35,316
639,121
696,763
Buildings
$
-
639,121
2019
$
76,104
(40,466)
35,638
44,725
(20,746)
23,979
84,696
(30,004)
54,692
-
114,309
Total
$
114,309
645,707
Carrying amount at the beginning of
year
Additions
◼
◼
35,638
-
23,979
3,331
54,692
3,255
Depreciation expense
(25,368)
(15,255)
(22,630)
-
(63,253)
Carrying amount at the end of year
10,270
12,056
35,316
639,121
696,763
Plant and equipment is stated at cost less accumulated depreciation and any accumulated impairment losses.
P a g e | 49
0
1
1
ANNUAL REPORT
30 June 2020
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Notes to the consolidated financial statements
for the year ended 30 June 2020
Note 10 Property, plant, and equipment (continued)
Cost includes expenditure that is directly attributable to the acquisition of the asset. The cost of self-constructed assets includes
the cost of materials and direct labour, any other costs directly attributable to bringing the asset to a working condition for its
intended use, and the costs of dismantling and removing the items and restoring the site on which they are located, and
appropriate proportion of production overheads.
Where parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items
of property, plant and equipment.
Gains and losses on disposal of an item of property, plant and equipment are determined by comparing the proceeds from
disposal with the carrying amount of property, plant and equipment and are recognised net within “other income” in profit or
loss.
The carrying amount of plant and equipment is reviewed annually by directors to ensure it is not in excess of the recoverable
amount from these assets. The recoverable amount is assessed on the basis of the expected net cash flows that will be
received from the assets employment and subsequent disposal. The expected net cash flows have been discounted to their
present values in determining recoverable amounts.
Depreciation rates and methods are reviewed annually for appropriateness. The depreciation rates used for the current and
comparative year are:
2020
$
Plant and equipment
33%-66%
Motor vehicles
33%-66%
2019
$
33%-66%
33%-66%
The assets' residual values, useful lives and amortisation methods are reviewed, and adjusted if appropriate, at each financial
year end.
For an asset that does not generate largely independent cash inflows, recoverable amount is determined for the cash-
generating unit to which the asset belongs, unless the asset's value in use can be estimated to be close to its fair value.
An impairment exists when the carrying value of an asset or cash-generating units exceeds its estimated recoverable amount.
The asset or cash-generating unit is then written down to its recoverable amount with the impairment loss recognised in the
statement of profit or loss and other comprehensive income.
Derecognition and disposal
An item of plant and equipment is derecognised upon disposal or when no further future economic benefits are expected from
its use or disposal.
Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal proceeds and the
carrying amount of the asset) is included in profit or loss in the year the asset is derecognised.
P a g e | 50
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Notes to the consolidated financial statements
for the year ended 30 June 2020
Note 11
Exploration and evaluation assets
a. Non-current
Exploration expenditure capitalised:
Exploration and evaluation phase at cost
Net carrying value
b. Movements in carrying amounts
Balance at the beginning of year
Expenditure during the year
Exploration expenditure write off
Carrying amount at the end of year
ANNUAL REPORT
30 June 2020
2020
$
2019
$
24,329,686
18,145,519
24,329,686
18,145,519
18,145,519
6,347,810
9,985,029
8,175,490
(163,643)
(15,000)
24,329,686
18,145,519
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:
i)
ii)
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
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 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.
The Group’s exploration properties may be subjected to claim(s) under Native Title (or jurisdictional equivalent), or contain
sacred sites, or sites of significance to the indigenous people of Australia.
As a result, exploration properties or areas within the tenement may be subject to exploration restrictions, mining restrictions
and/or claims for compensation. At this time, it is not possible to quantify whether such claims exist, or the quantum to such
claims.
P a g e | 51
ANNUAL REPORT
30 June 2020
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Notes to the consolidated financial statements
for the period ended 30 June 2020
Note 12 Trade and other payables
a. Current
Unsecured
Trade payables
Accruals
Employment related payables
Note 13
Provisions
a. Current
Provision for stamp duty
Provision for payroll tax
Provision for annual leave
2020
$
2019
$
1,211,870
1,316,700
21,000
105,237
462,119
97,792
1,338,107
1,876,611
2020
$
2019
$
-
120,096
8,972
39,247
48,219
-
31,027
151,123
Trade payables and provisions are non-interest bearing and usually settled within the lower of terms of trade or 30 days.
Trade payables, other payables and provisions 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.
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is
probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable
estimate can be made of the amount of the obligation. Provisions are not recognised for future operating losses. When the
Group expects some or all of a provision to be reimbursed, for example under an insurance contract, the reimbursement is
recognised as a separate asset but only when the reimbursement is virtually certain. The expense relating to any provision is
presented in the statement of profit or loss and other comprehensive income net of any reimbursement. Provisions are
measured at the present value or management’s best estimate of the expenditure required to settle the present obligation at
the end of the reporting year. If the effect of the time value of money is material, provisions are discounted using a current pre-
tax rate that reflects the risks specific to the liability.
Short-term benefits:
Liabilities for employee benefits for wages, salaries and annual leave that are expected to be settled within 12 months of the
reporting date represent present obligations resulting from employees' services provided to the reporting date and are
calculated at undiscounted amounts based on remuneration wage and salary rates that the Group expects to pay at the
reporting date including related on-costs, such as workers compensation insurance and payroll tax.
P a g e | 52
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Notes to the consolidated financial statements
for the year ended 30 June 2020
Note 14
Issued capital
ANNUAL REPORT
30 June 2020
Fully paid ordinary shares at no par value
219,464,064
1,578,887,024
39,714,679
29,712,407
2020
No.
2019
No.
2020
$
2019
$
a. Ordinary shares
At the beginning of the year
Shares issued during the year:
Balance before reverse acquisition
ESIP Shares issued
Placement to Alkane Resources
Directors Shares cancelled
Directors Shares issued
Issue of shares to Epminex
Exercise of options
ESIP Shares issued
Placement to Alkane Resources
Exercise of options
Exercise of options
Exercise of options
Exercise of options
Exercise of options
Underwriting fee
Shares issued for tenement purchase
Performance shares conversion
Placement
Exercise of options
Exercise of options
Exercise of options
Share consolidation (One for ten)
Exercise of options
Exercise of options
Exercise of options
Exercise of options
Exercise of options
Exercise of options
Transaction costs relating to share issues
At reporting date
Terms of Ordinary Shares
Voting Rights
1,578,887,024
1,276,453,495
29,712,407
21,712,043
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
17,500,000
125,000,000
(5,000,000)
5,000,000
120,000
555,556
1,046,025
80,000,000
600,000
80,000
1,110,000
32,821,948
42,400,000
1,200,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
154,500
-
9,000,000
40,000
100,000
18,750
-
414,029
3,687,500
-
-
3,360
13,889
25,000
2,160,000
15,000
2,000
27,750
820,549
1,060,000
30,000
-
-
-
-
-
-
1,578,887,024
39,025,657
29,971,120
-
-
-
-
-
-
-
-
-
-
-
6,250
25,000
513,750
256,250
215,000
227,500
(554,728)
(258,712)
5,000,000
275,000,000
281,250,000
2,000,000
4,000,000
750,000
2,146,887,024
214,689,064
25,000
100,000
1,975,000
925,000
900,000
850,000
-
219,464,064
1,578,887,024
39,714,679
29,712,407
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.
P a g e | 53
ANNUAL REPORT
30 June 2020
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Notes to the consolidated financial statements
for the year ended 30 June 2020
Note 14 Issued capital (continued)
2020
No.
2019
No.
2020
$
2019
$
b. Options
At the beginning of the year
166,500,000
187,000,000
734,396
Issue of options to directors/employees
-
-
Options exercised
Options expired/cancelled
Placement to Alkane Resources
Share consolidation (One for ten)
Issue of options
Options exercised
At reporting date
c. Share Rights and Performance Rights
At the beginning of the year
Issue of Performance Rights
Share consolidation (One for ten)
Issue of Share Rights
At reporting date
d. Performance shares
-
-
-
-
145,039
589,357
-
-
-
(6,750,000)
(87,500,000)
(70,000,000)
(3,000,000)
-
70,000,000
89,750,000
166,500,000
734,396
734,396
8,975,000
11,588,500
(4,775,000)
-
-
-
-
870,200
-
-
-
-
15,788,500
166,500,000
1,604,596
734,396
21,000,000
12,000,000
-
9,000,000
21,000,000
21,000,000
2,100,000
497,903
-
-
2,597,903
21,000,000
45,991
106,788
152,779
-
152,862
305,641
At the beginning of the year
275,000,000
275,000,000
Performance shares converted
(275,000,000)
-
At reporting date
e. Employee shares
At the beginning of the year
ESIP share issued
ESIP converted
At reporting date
-
-
-
-
-
275,000,000
17,500,000
1,046,025
(18,546,025)
-
-
-
-
-
-
-
-
25,816
20,175
45,991
-
-
45,991
-
-
-
414,029
25,000
(439,029)
-
P a g e | 54
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Notes to the consolidated financial statements
for the year ended 30 June 2020
Note 14 Issued capital (continued)
f. Capital Management
ANNUAL REPORT
30 June 2020
The directors' objectives when managing capital are to ensure that the Group can maintain a capital base so as to maintain
investor, creditor and market confidence and to sustain future development of the business. The Board of Directors monitors
the availability of liquid funds in order to meet its short term commitments.
The focus of the Group's capital risk management is the current working capital position against the requirements of the
Group in respect to its operations, software developments programmes, and corporate overheads. The Group's strategy is
to ensure appropriate liquidity is maintained to meet anticipated operating requirements, with a view to initiating
appropriate capital raisings as required.
The working capital position of the Group were as follows:
Cash and cash equivalents
Trade and other receivables
Trade and other payables
Working capital position
Note
7
8
12
2020
$
2019
$
5,690,661
4,145,369
261,695
307,782
(1,338,107)
(1,876,611)
4,614,249
2,576,540
P a g e | 55
ANNUAL REPORT
30 June 2020
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Notes to the consolidated financial statements
for the year ended 30 June 2020
Note 15
Employee Shares
Balance at the beginning of the financial year
ESIP shares issued
Conversion of employee shares
Balance at the end of the financial year
2020
$
2019
$
-
-
-
-
414,029
25,000
(439,029)
-
The Employee Shares note records items recognised as expenses on the value of employee shares issued under the Employee
Shares Incentive Plan.
Note 16 Reserves
Options
Share rights and Performance Rights
a. Options Reserve
Balance at the beginning of the financial year
Share based payments
Balance at the end of the financial year
2020
$
2019
$
14b
14c
1,604,596
305,641
734,396
45,991
1,910,237
780,387
2020
$
734,396
870,200
1,604,596
2019
$
145,039
589,357
734,396
17
The option reserve records items recognised as expenses on the value of directors and employee equity issues.
At 30 June 2020, the following options are outstanding:
▪
▪
▪
▪
▪
▪
▪
4,200,000 unlisted options exercisable at 20.0 cents expiring on or before 18 April 2021
388,500 unlisted options issued to senior executives exercisable at nil price expiring on or before 27 December 2021
700,000 unlisted options issued to non-executive directors exercisable at nil price expiring on or before 27 December
2023
7,150,000 unlisted options issued to senior executives exercisable at nil price expiring on or before 27 December 2024
150,000 unlisted options issued to senior executives exercisable at nil price expiring 30 June 2022
2,700,000 unlisted options issued to senior executives exercisable at nil price expiring 30 January 2025
500,000 unlisted options issued to senior executives exercisable at nil price expiring 4 June 2025
P a g e | 56
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Notes to the consolidated financial statements
for the year ended 30 June 2020
Note 16 Reserves (continued)
ANNUAL REPORT
30 June 2020
b.i. Share Rights
Balance at the beginning of the financial year
Shae based payments
Balance at the end of the financial year
2020
$
2019
$
14c/17
-
152,862
152,862
-
-
-
At 30 June 2020, the following share rights are outstanding:
▪
▪
▪
▪
▪
▪
122,768 and 38,036 share rights for David Reeves and Wild West Enterprises Pty Ltd respectively;
26,786 share rights for Mark Connelly;
6,429 and 32,143 share rights for Adam Miethke and Discovery Capitals Pty Ltd;
107,143 share rights each for Paul Brennan and Richard Hill;
23,973 share rights for an employee; and
33,482 share rights for a contractor.
Please refer to Note 17(e) and remuneration report for further details on share rights issued to Key Management Personnel.
b.ii. Performance Rights
Balance at the beginning of the financial year
Share based payments
Balance at the end of the financial year
At 30 June 2020, the following performance rights are outstanding:
▪
▪
1,200,000 performance rights for employees expiring 13 June 2021;
900,000 performance rights for Paul Brennan expiring 3 May 2022.
2020
$
45,991
106,788
152,779
2019
$
25,816
20,175
45,991
14c/17
P a g e | 57
ANNUAL REPORT
30 June 2020
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Notes to the consolidated financial statements
for the year ended 30 June 2020
Note 17
Share-based payments
Options:
Share based payments – Key Management Personnel
Share based payments – Employee
Subtotal – Share based payments (Options)
Performance rights:
Note
17b
17b
Share based payments – Key Management Personnel
17a.iii
Subtotal – Share based payments (Employee Shares)
Share Rights:
Share based payments – Key Management Personnel
Share based payments – Related Party Transactions
Share based payments – Employee and Contractor
Subtotal – Share based payments (Share Rights)
ESIP Shares issued
Gross share-based transactions
17e
17e
17e
15
2020
$
723,187
147,013
870,200
106,788
106,788
116,110
20,090
16,662
152,862
2019
$
589,357
-
589,357
20,175
20,175
-
-
-
-
-
25,000
1,129,850
634,532
Equity-settled compensation
The fair value of options granted is recognised as an employee expense with a corresponding increase in equity. The fair
value is measured at grant date and spread over the period during which the employees become unconditionally entitled
to the options. The fair value of the options granted is measured using the Black-Scholes pricing model, taking into
account the terms and conditions upon which the options were granted. The amount recognised is adjusted to reflect the
actual number of share options that vest except where forfeiture is only due to market conditions not being met.
a. Share-based payment arrangements in effect during the year
i.
Employee Securities Incentive Plan – Non Executive and Executive Options
During the year, the Company issued the following options with the terms and summaries below:
Number of Options
Date of Expiry
Exercise Price
Vesting Terms
700,000*
27 December 2023
388,500*
27 December 2021
150,000
30 January 2022
Nil
Nil
Nil
1/3 each year for
continuous service from
grant date
12 months from
continuous service from
grant date
12 months from
continuous service from
grant date
* On 25 November 2019, the Company’s shareholders approved the issuance of 700,000 and 150,000 Options to Non-
Executives and Executives respectively under ESIP with terms.
P a g e | 58
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Notes to the consolidated financial statements
for the year ended 30 June 2020
ii.
Employee Securities Incentive Plan – Incentive Options
ANNUAL REPORT
30 June 2020
In consideration for retaining key quality employees of Calidus, the Company has issued the following Incentive
Options under the Employee Securities Incentive Plan:
Number of Options
Date of Expiry
Exercise Price
7,150,000*
27 December 2024
2,700,000
500,000
30 January 2025
4 June 2025
Nil
Nil
Nil
Vesting Terms:
1. 50% of options will vest upon announcing a positive definitive feasibility study for Warrawoona Gold Project and
the Company announcing that it has acquired the approvals and permits required to commence construction of the
mine on the Warrawoona Gold Project from the Environmental Protection Authority, the Department of Mines,
Industry Regulation and Safety, and the Department of the Environment and Energy; and
2. Subject to the vesting of the first half of the incentive options, the remaining 50% options will vest upon the
Company announcing that first gold pour has been achieved at the Warrawoona Gold Project.
* On 25 November 2019, the Company’s shareholders approved the issuance of 3,000,000 options to David
Reeves based on the above terms.
iii.
Employee Securities Incentive Plan – Employee Performance Shares
In consideration for retaining key quality employees of Calidus, the Company has issued 9,000,000 (Pre 10:1 shares
consolidation) under the Employee Securities Incentive.
Number of Options
Date of Expiry
Exercise Price
Vesting Terms
9,000,000
27 December 2022
$0.03
12 months from issue
date
Subsequent to the issue of the options the company performed a ten (10) to one (1) consolidation of the share capital
including all options on issue.
The options that were issued under Employee Securities Incentive Plan were valued using the Black-Scholes option
pricing model, applying the following inputs to determine the fair value at the grant date:
Share price
at grant
date ($)
Exercise
Price
($)
Number of
options issued
Term
(Years)
Expected
volatility
(%)
Risk free
interest rate
(%)
Fair value at
grant date
($)
Grant Date
25 Nov 2019
25 Nov 2019
25 Nov 2019
29 Jan 2020
29 Jan 2020
$0.21
$0.21
$0.21
$0.26
$0.26
Nil
Nil
Nil
Nil
Nil
Nil
700,000
388,500
7,150,000
150,000
2,700,000
500,000
5
4
2
2
5
5
3
90.24%
90.24%
90.24%
90.24%
90.24%
90.24%
90.24%
0.81%
0.81%
0.76%
0.70%
0.76%
0.39%
1.28%
$0.21
$0.21
$0.21
$0.26
$0.26
$0.45
$0.014
2 June 2020
$0.495
3 May 2019
$0.026
$0.03
900,000*
* Represent post 10:1 share consolidation (Pre 10:1 share consolidation; 9,000,000 performance rights)
P a g e | 59
ANNUAL REPORT
30 June 2020
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Notes to the consolidated financial statements
for the year ended 30 June 2020
Note 17 Share-based payments (continued)
b. Summary of number of options and its value
A summary of number of company options issued to Key Management Personnel and Employees as share-based payments
are as follows:
Number of shares
Executive Options
David
Reeves
Mark
Connelly
Keith
Coughlan
Adam
Miethke
Paul
Brennan
Richard
Hill
Employees
a. 388,500 options
150,000
b. 150,000 options
-
N/A
N/A
N/A
N/A
N/A
N/A
150,000
-
88,500
-
150,000
NED Options
a. 700,000 options
N/A
300,000
200,000
200,000
N/A
N/A
N/A
Incentive options
a. 7,150,000 options
3,000,000
b. 2,700,000 options
c. 500,000 options
-
-
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
2,700,000
-
1,450,000
-
-
2,700,000
-
-
500,000
A summary of share based expense payments issued to Key Management Personnel and Employees are as follows:
Key Management Personnel
Employees
David
Reeves
Mark
Connelly
Keith
Coughlan
Adam
Miethke
Paul
Brennan
Richard Hill
A$
Executive Options
a. 388,500 options
18,762
b. 150,000 options
-
N/A
N/A
N/A
N/A
N/A
N/A
18,762
-
11,070
-
16,348
-
NED Options
a. 700,000 options
N/A
12,531
8,354
8,354
N/A
N/A
N/A
Incentive options1
a. 7,150,000 options
221,516
b. 2,700,000 options
c. 500,000 options
-
-
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
199,364
-
107,068
-
-
219,196
-
-
28,875
Total – Key Management Personnel (A$)
Total – Employees (A$)
723,187
147,013
1 As at reporting date, the probability of achievement of the milestones and the first of the options are deemed to be 100%
with estimated achievement date on 30 September 2020. No value was expensed for second half of the options during
the year as the probability of achievement of the milestone as at 30 June 2020 was less than 50%.
P a g e | 60
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
ANNUAL REPORT
30 June 2020
Notes to the consolidated financial statements
for the year ended 30 June 2020
Notes to the consolidated financial statements
for the year ended 30 June 2020
Note 17 Share-based payments (continued)
c. Movement in share-based payment arrangements during the year
A summary of the movements of all company options issued to Key Management Personnel as share-based payments is as
follows:
2020
2019
Weighted Average
Exercise Price
Number of Options
Weighted Average
Exercise Price
Outstanding at the beginning of the year
Granted
Exercised
Expired/cancelled
Consolidation
Granted
Outstanding at year-end
Exercisable at year-end
Number of
Options
16,000,000
1,150,000
(1,000,000)
(600,000)
$0.03
$0.00
$0.30
$0.10
(14,400,000)
-
8,400,000
9,550,000
$0.00
$0.00
19,000,000
$0.03
-
-
-
-
(3,000,000)
$0.03
-
-
-
-
16,000,000
$0.03
-
$0.00
16,000,000
$0.03
i. The weighted average exercise price of outstanding options at the end of the reporting year was nil.
ii. The fair value of the options granted is deemed to represent the value of the employee services received over the vesting
period.
d. A summary of the movements of all company options (excluding performance rights) on issue is as follows:
2020
2019
Number of Options
Number of Options
Weighted Average
Exercise Price
Weighted Average
Exercise Price
Outstanding at the beginning of the year
166,500,000
(6,750,000)
(70,000,000)
-
(80,775,00)
11,588,500
(4,775,000)
15,788,500
$0.280
$0.024
$0.035
-
-
$0.00
$0.25
$0.01
187,000,000
(87,500,000)
(3,000,000)
70,000,000
-
-
-
$0.024
$0.025
$0.025
$0.035
-
-
-
166,500,000
$0.028
-
-
166,500,000
$0.028
Exercised [Pre 10:1 consolidation]
Expired/cancelled
Granted [Pre 10:1 consolidation]
Consolidation
Issue of options
Exercised
Outstanding at year-end
Exercisable at year-end
P a g e | 61
ANNUAL REPORT
30 June 2020
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Notes to the consolidated financial statements
for the year ended 30 June 2020
Note 17 Share-based payments (continued)
e. A summary of share rights issued during the year:
Deemed grant
date
Share price at grant
date ($)
Name
Key Management Personnel
Number of
share rights
Fair value at
grant date ($)
7 May 2020
5 May 2020
26 May 2020
20 May 2020
8 May 2020
Related Party Transaction
4 May 2020
13 May 2020
Employees and Contractor
8 May 2020
4 May 2020
Total
$0.30
$0.305
$0.395
$0.35
$0.29
$0.30
$0.27
$0.29
$0.29
David Reeves
Mark Connelly
Adam Miethke
Paul Brennan
Richard Hill
122,768
26,786
6,429
107,143
107,143
Wild West Enterprises Pty Ltd
Discovery Capital Partners Pty Ltd
38,036
32,143
Employee
Contractor
23,973
33,482
497,903
36,830
8,170
2,539
37,500
31,071
116,110
11,411
8,679
20,090
6,952
9,710
16,662
152,862
As stated in the Company's March 2020 Quarterly Report, the Company initiated various cash preservation measures in March
at the start of the COVID-19 pandemic to ensure it was funded through to a final investment decision on the Warrawoona Gold
Project. This includes various directors, senior staff and consultants electing to take part of their pay in the form of Securities.
The Company has invited directors senior staff and consultants electing to participate in a discretionary salary reduction in
return for rights to acquire Shares (Share Rights) to be granted under the Employee Securities Incentive Plan (ESIP), whereby
they may elect to accrue up to 50% of their salary (Reduced Amount) from 1 April to 30 June 2020.
In return for their agreement to reduce their salary, the Company has agreed to grant each of the participant Share Rights under
the ESIP. Each Share Right will entitle the holder to acquire one Share in the Company. The deemed issue price for the Share
Rights is $0.28 each, which represents the VWAP for the month of April 2020 and which is the same deemed issue price of
Shares issued to other unrelated staff and service providers of the Company. The Share Rights immediately vest on the grant
date and expire 24 months from the grant date.
The rationale for inviting the participants to participate in a discretionary salary reduction in return for Share Rights is to
preserve cash within the Company, strengthen the Company's balance sheet, align directors' remuneration with the Company's
and Shareholders' objectives, and to provide directors with an incentive to enhance Shareholder value.
P a g e | 62
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Notes to the consolidated financial statements
for the year ended 30 June 2020
Note 18 Controlled entities
a. Legal parent entity
ANNUAL REPORT
30 June 2020
Calidus Resources Limited is the ultimate parent of the Group (refer to note 1c).
i. Legal subsidiaries
◼ Keras (Gold) Australia Pty Limited
◼ Keras (Pilbara) Gold Pty Limited
◼ Calidus Otways Pty Limited
Country of
Incorporation
Australia
Australia
Australia
Class of
Shares
Ordinary
Ordinary
Ordinary
Percentage Owned
2020
100.0
100.0
100.0
2019
100.0
100.0
100.0
b. Investments in subsidiaries are accounted for at cost.
Note 19 Key Management Personnel compensation (KMP)
The names are positions of KMP are as follows:
Managing Director
◼ Mr David Reeves
◼ Mr Mark Connelly
◼ Mr Keith Coughlan
◼ Mr Adam Miethke Non-executive Director (resigned 27 July 2020)
◼ Mr Paul Brennan
◼ Mr Richard Hill
Non-executive Chairman
Non-executive Director
Chief Operating Officer
Chief Financial Officer
Information regarding individual directors and executives’ compensation and some equity instruments disclosures as required
by the Corporations Regulations 2M.3.03 is provided in the Remuneration Report.
Short-term employee benefits
Post-employment benefits
Share-based payments
Total
2020
$
650,950
41,004
946,085
2019
$
414,700
5,700
199,546
1,638,039
619,946
P a g e | 63
ANNUAL REPORT
30 June 2020
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Notes to the consolidated financial statements
for the year ended 30 June 2020
Note 20 Related party transactions
Transactions between related parties are on normal commercial terms and
conditions no more favourable than those available to other parties unless
otherwise stated.
◼ Wilgus Investments Pty Ltd and Wild West Enterprises Pty Ltd - Office Rent
◼ Discovery Capital – Corporate Advisory and Capital Raising Fees
2020
$
2019
$
81,961
119,679
62,300
170,000
Refer to the Remuneration Report point 14.8 for further information regarding the terms of the related party transactions.
Note 21
Commitments
Exploration expenditure commitments payable:
Not later than 12 months
Between 12 months and five years
Later than five years
Total Exploration tenement minimum expenditure requirements
Operating lease commitments for premises due:
Not later than 12 months
Between 12 months and five years
Later than five years
Total operating lease commitments
Note 22 Operating segments
2020
$
2019
$
572,780
1,046,789
1,864,078
3,483,647
565,077
1,400,211
2,156,710
4,121,998
42,600
34,200
-
-
-
-
42,600
34,200
For management purposes, the Group’s operations are organised into one operating segment domiciled in the same country,
which involves the exploration and exploitation of Gold minerals in Australia. All of the Group’s activities are inter-related, and
discrete financial information is reported to the Managing Director as a single segment. Accordingly, all significant operating
decisions are based upon analysis of the Group as one segment. The financial results from this segment are equivalent to the
statement of comprehensive income. The accounting policies applied for internal reporting purposes are consistent with those
applied in preparation of these financial statements.
P a g e | 64
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Notes to the consolidated financial statements
for the year ended 30 June 2020
Note 23
Financial risk management
a. Financial Risk Management Policies
ANNUAL REPORT
30 June 2020
This note presents information about the Group's exposure to each of the above risks, its objectives, policies and procedures
for measuring and managing risk, and the management of capital.
The Group's financial instruments consist mainly of deposits with banks, short-term investments, and accounts payable and
receivable.
The Group does not speculate in the trading of derivative instruments.
A summary of the Group's Financial Assets and Liabilities is shown below:
Floating
Interest
Rate
$
Fixed
Interest
Rate
$
Non-
interest
Bearing
$
2020
Total
$
Floating
Interest
Rate
$
Fixed
Interest
Rate
$
Non-
interest
Bearing
$
2019
Total
$
Financial Assets
Cash and cash equivalents
5,690,661
Trade and other receivables
Financial assets
-
-
Total Financial Assets
5,690,661
Financial Liabilities
Financial liabilities at
amortised cost
Trade and other payables
Short-term financial liabilities
Long-term financial liabilities
Total Financial Liabilities
-
-
-
-
Net Financial
Assets/(Liabilities)
5,690,661
-
-
-
-
-
-
-
-
-
-
5,690,661
4,145,369
261,695
261,695
1,362,119
1,362,119
-
-
1,623,814
7,314,475
4,145,369
1,338,107
1,338,107
-
-
-
-
1,338,107
1,338,107
-
-
-
-
285,707
5,976,368
4,145,369
-
-
-
-
-
-
-
-
-
-
4,145,369
307,782
307,782
1,275,245
1,275,245
1,583,027
5,728,396
1,876,611
1,876,611
-
-
-
-
1,876,611
1,876,611
(293,584)
3,851,785
P a g e | 65
ANNUAL REPORT
30 June 2020
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Notes to the consolidated financial statements
for the year ended 30 June 2020
Note 23
Financial risk management (continued)
b. Specific Financial Risk Exposures and Management
The main risk the Group is exposed to through its financial instruments are credit risk, liquidity risk and market risk consisting
of interest rate, foreign currency risk and equity price risk.
The Board of directors has overall responsibility for the establishment and oversight of the risk management framework. The
Board adopts practices designed to identify significant areas of business risk and to effectively manage those risks in
accordance with the Group's risk profile. This includes assessing, monitoring and managing risks for the Group and setting
appropriate risk limits and controls. The Group is not of a size nor is its affairs of such complexity to justify the establishment
of a formal system for risk management and associated controls. Instead, the Board approves all expenditure, is intimately
acquainted with all operations and discuss all relevant issues at the Board meetings. The operational and other compliance
risk management have also been assessed and found to be operating efficiently and effectively.
i. Credit risk
Exposure to credit risk relating to financial assets arises from the potential non-performance by counterparties of contract
obligations that could lead to a financial loss to the Group.
The Group does not have any material credit risk exposure to any single receivable or group of receivables under financial
instruments entered into by the Group.
The objective of the Group is to minimise the risk of loss from credit risk. Although revenue from operations is minimal,
the Group trades only with creditworthy third parties.
In addition, receivable balances are monitored on an ongoing basis with the result that the Group's exposure to bad debts
is insignificant. The Group's maximum credit risk exposure is limited to the carrying value of its financial assets as
indicated on the statement of financial position.
The Group establishes an allowance for impairment that represents its estimate of incurred losses in respect of trade and
other receivables.
◼ Credit risk exposures
The maximum exposure to credit risk is that to its alliance partners and that is limited to the carrying amount, net of
any provisions for impairment of those assets, as disclosed in the statement of financial position and notes to the
financial statements.
Credit risk related to balances with banks and other financial institutions is managed by the Group in accordance with
approved Board policy. Such policy requires that surplus funds are only invested with financial institutions residing in
Australia, where ever possible.
◼
Impairment losses
The ageing of the Group's trade and other receivables at reporting date was as follows:
P a g e | 66
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Notes to the consolidated financial statements
for the year ended 30 June 2020
Note 23
Financial risk management (continued)
ANNUAL REPORT
30 June 2020
Gross
2020
$
36,575
-
-
-
-
-
225,120
261,695
Impaired
2020
$
Past due but not
impaired
2020
$
Net
2020
$
-
-
-
-
-
-
-
-
36,575
-
-
-
-
-
240,206
276,781
-
-
-
-
-
-
-
-
Trade receivables
Not past due
Past due up to 15 days
Past due 15 days to 3 months
Past due over 3 months
Less intra-Group balances
Other receivables
Not past due
Total
ii. Liquidity risk
Liquidity risk arises from the possibility that the Group might encounter difficulty in settling its debts or otherwise meeting
its obligations related to financial liabilities.
The Group manages liquidity risk by continuously monitoring forecast and actual cash flows and ensuring sufficient cash
and marketable securities are available to meet the current and future commitments of the Group.
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.
Typically the Group ensures that it has sufficient cash to meet expected operational expenses for a period of 60 days,
including the servicing of financial obligations; this excludes the potential impact of extreme circumstances that cannot
reasonably be predicted, such as natural disasters.
P a g e | 67
ANNUAL REPORT
30 June 2020
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Notes to the consolidated financial statements
for the year ended 30 June 2020
Note 23
Financial risk management (continued)
Other than the trust account insurer liabilities, the financial liabilities of the Group are confined to trade and other
payables as disclosed in the statement of financial position. All trade and other payables are non-interest bearing and
due within 30 days of the reporting date.
◼ Contractual Maturities
The following are the contractual maturities of financial liabilities of the Group:
Within 1 Year
Greater Than 1 Year
2020
$
2019
$
2020
$
2019
$
Total
2020
$
2019
$
Financial liabilities due for payment
Trade and other payables
Borrowings
1,338,107
-
1,876,611
-
Total contractual outflows
1,338,107
1,876,611
Financial assets
Cash and cash equivalents
Trade and other receivables
Financial assets
5,690,661
261,695
1,362,119
4,145,369
307,782
1,275,245
Total anticipated inflows
7,314,475
5,728,396
Net (outflow)/inflow on financial
instruments
5,976,368
3,851,785
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,338,107
-
1,876,611
-
1,338,107
1,876,611
5,690,661
261,695
1,362,119
4,145,369
307,782
1,275,245
7,314,475
5,728,396
5,976,368
3,851,785
It is not expected that the cash flows included in the maturity analysis could occur significantly earlier or at
significantly different amounts.
iii. 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 objective of market risk management
is to manage and control market risk exposures within acceptable parameters, while optimising the return.
The Board meets on a regular basis and considers the Group's interest rate risk.
(1) Interest rate risk
Exposure to interest rate risk arises on financial assets and financial liabilities recognised at the end of the reporting
year whereby a future change in interest rates will affect future cash flows or the fair value of fixed rate financial
instruments. The Group is also exposed to earnings volatility on floating rate instruments.
Due to the low amount of debt exposed to floating interest rates, interest rate risk is not considered a high risk to
the Group. Movement in interest rates on the Group's financial liabilities and assets is not material.
(2) Foreign exchange risk
Exposure to foreign exchange risk may result in the fair value or future cash flows of a financial instrument fluctuating
due to movement in foreign exchange rates of currencies in which the Group holds financial instruments which are
other than the AUD functional currency of the Group.
The Group has no material exposure to foreign exchange risk.
(3) Price risk
Price risk relates to the risk that the fair value or future cash flows of a financial instrument will fluctuate because of
changes in market prices. The Group holds a material amount (Pacton Gold Inc shares) subject to price risk.
P a g e | 68
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Notes to the consolidated financial statements
for the year ended 30 June 2020
Note 23
Financial risk management (continued)
iv. Sensitivity Analyses
ANNUAL REPORT
30 June 2020
The following table illustrates sensitivities to the Group's exposures to changes in interest rates. The table indicates the
impact on how profit and equity values reported at balance sheet date would have been affected by changes in the
relevant risk variable that management considers to be reasonably possible. These sensitivities assume that the
movement in a particular variable is independent of other variables.
(1) Interest rates
Year ended 30 June 2020
±50 basis points change in interest rates
Year ended 30 June 2019
±50 basis points change in interest rates
(2) Price
Year ended 30 June 2020
±10% change in market price of shares
Year ended 30 June 2019
±10% change in market price of shares
v. Net Fair Values
(1) Fair value estimation
Profit
$
Equity
$
± 28,453
± 28,453
± 22,707
± 22,707
Profit
$
Equity
$
± 136,211
± 136,211
± 127,245
± 127,245
Fair value measurements are categorised into Level 1, 2 or 3 based on the degree to which the inputs to the fair value
measurements are observable and the significance of the inputs to the fair value measurement in its entirety, which
are described as follows:
•
•
•
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 Pacton Gold Inc shares valued at $1,362,119 are measured under level 1 in the fair value hierarchy. Cash and
cash equivalents, trade and other receivables, trade creditors, other creditors and employee entitlements have been
excluded from the above analysis as their fair values are equal to their carrying values.
P a g e | 69
ANNUAL REPORT
30 June 2020
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Notes to the consolidated financial statements
for the year ended 30 June 2020
Note 24
Events subsequent to reporting date
• On 1 July 2020 Calidus announced that tenders for the major contracts, comprising a schedule of rates mining
contract, tailings dam construction, EPC for the processing plant construction and a build, own, operate (BOO)
model for the power station, have been let to the market.
• On 1 July 2020 Calidus announced specialist natural resources investment house Argonaut had been
appointed to act as the Company’s exclusive debt advisor.
• On 13 July 2020 Calidus announced that drilling was to commence at the Otways project.
• On 17 July 2020 the company announced that it had received firm commitments to raise $25 million (before
costs) via a share placement to professional and sophisticated investors through the issue of 49,019,608
shares at a price of $0.51.
• On 27 July 2020 that Mr Adam Miethke resigned as Non-Executive Director of the Company.
• On 5 August 2020 the company announced that experienced mining executive Don Russell had commenced in
the role of General manager operations
• On 5 August 2020 Calidus announced that Environmental Permits had been granted for early works at
Warrawoona which provided the Company with the option to commence installation the mine access road
and accommodation village prior to receiving full project development approval.
• On 5 August 2020 and 12 August 2020, Calidus announced the issuance of 600,000 and 170,000 unlisted
•
options to Donald Russell and an employee respectively.
0n 13 August 2020, Calidus announced that it has issued and allotted 200,000 shares upon the exercise of
200,000 unquoted options, exercise price of nil, expiring 27 December 2023.
• On 24 August 2020. Calidus announced that it had Environmental approval for the Warrawoona Gold Project
granted by the Western Australian Minister for Environment and that and the debt finance process was
progressing with indicative debt term sheets received.
Apart from the matters discussed above, no other matter or circumstance has arisen since 30 June 2020 that has significantly
affected, or may significantly affect the Group's operations, the results of those operations, or the consolidated entity's state of
affairs in future financial years.
Note 25
Contingent liabilities
b. Royalties and Joint Ventures
Keras (Pilbara) Gold Pty Ltd has an obligation to pay royalties, based on minerals produced from various tenements, to
third parties as disclosed in the Section 8 of the Company’s prospectus dated 8 May 2017. The royalties will only become
due and payable when and if mining commences.
On 27 May 2020 the Company announced that it may earn up to a 70% interest in the Otways tenements by spending $1.2
million on the tenements over 30 months (Expenditure Commitment). At the completion of the Expenditure Commitment,
each party will be subject to a fund or dilute obligation in the respective proportions on the Otways Tenements with any
interest diluting below 10% converting to a 1% net smelter royalty.
Calidus has completed earning a 70% interest in the Novo tenements. Following the earn-in a JV has been formed, with
each party subject to a fund or dilute obligation in the respective proportions on the Novo Tenements with any interest
diluting below 10% converting to a 1% net smelter royalty.
Note 26 Auditor’s remuneration
Remuneration of the auditor of the company for:
Auditing or reviewing the financial reports
Other services provided by a related practice of the auditor
2020
$
40,000
-
40,000
2019
$
35,800
190
35,990
P a g e | 70
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Notes to the consolidated financial statements
for the year ended 30 June 2020
Note 27
Parent entity disclosures
ANNUAL REPORT
30 June 2020
The following information has been executed from the books and records of the legal parent Calidus Resources Limited have
been prepared in accordance with Australian Accounting Standards and the accounting policies as outlined in Note 1.
b. Financial Position of Calidus Resources Limited (legal parent)
Current assets
Non-current assets
Total assets
Current liabilities
Non-current assets
Total liabilities
Net assets
Equity
Issued capital
Options and Share Rights reserve
Employee shares
Accumulated losses
Total equity
c. Financial performance of Calidus Resources Limited
Profit / (loss) for the year
Other comprehensive income
Total comprehensive income
June 2020
$
June 2019
$
31,742,750
21,604,674
2,107
1,745
31,744,857
21,606,419
161,486
7,799
706,593
-
169,285
706,593
31,575,573
20,899,826
65,193,087
53,444,699
1,783,274
126,963
760,212
20,175
(35,527,762)
(33,325,260)
31,575,573
20,899,826
(2,202,502)
(2,524,347)
-
-
(2,202,502)
(2,524,347)
d. Guarantees entered into by Calidus Resources Limited for the debts of its subsidiaries
There are no guarantees entered into by Calidus Resources Limited for the debts of its subsidiaries as at 30 June 2020 (2019:
none).
e. Comparatives
The financial position of Calidus Resources Limited is as at 30 June 2020 for the current year and 30 June 2019 for the
comparative year.
The financial performance of Calidus Resources Limited is for the period between 1 July 2019 to 30 June 2020 and for the
comparative period between 1 July 2018 to 30 June 2019.
P a g e | 71
ANNUAL REPORT
30 June 2020
DIRECTORS' DECLARATION
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
1.
In the opinion of the Directors of Calidus Resources Limited (the ‘Company’):
a.
the financial statements, notes and the additional disclosures are in accordance with the Corporations Act
2001 including:
I.
ii.
giving a true and fair view of the Group’s financial position as at 30 June 2020 and of its performance
for the year then ended; and
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 for the financial year ended 30 June 2020.
MARK CONNELLY
Non-executive Chairman
Dated this Friday, 11 September 2020
P a g e | 72
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF CALIDUS RESOURCES LIMITED
REPORT ON THE AUDIT OF THE FINANCIAL REPORT
Opinion
Moore Australia Audit (WA)
Level 15, Exchange Tower,
2 The Esplanade, Perth, WA 6000
PO Box 5785, St Georges Terrace, WA 6831
T +61 8 9225 5355
F +61 8 9225 6181
www.moore-australia.com.au
We have audited the financial report of Calidus Resources Limited (the Company) and its subsidiaries (the
“Group”), which comprises the consolidated statement of financial position as at 30 June 2020, 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 ended 30 June 2020, and notes
to the financial statements, including a summary of significant accounting policies, and the directors’
declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act
2001, including:
i.
ii.
giving a true and fair view of the Group’s financial position as at 30 June 2020 and of its
financial performance for the year then ended; and
complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those
standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Report section
of our report. We are independent of the Group in accordance with the auditor independence
requirements of the Corporations Act 2001 and the ethical requirements of the Accounting Professional and
Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (the “Code”) that are
relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical
responsibilities in accordance with the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has been given
to the directors of the Company, would be in the same terms if given to the directors as at the time of this
auditor’s report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
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.
Moore Australia Audit (WA) – ABN 16 874 357 907.
An independent member of Moore Global Network Limited - members in principal cities throughout the world.
Liability limited by a scheme approved under Professional Standards Legislation.
P a g e | 73
Share Based Payments – Remuneration
Refer to Note 17 Share Based Payments & Remuneration Report
During the year ended 30 June 2020, the Group
transacted with Key Management Personnel and other
parties via the award of share-based remuneration
payments (SBP) amounting to $1,129,850 in the form of
equity settled share-based payments.
The value of the SBP is a key audit matter due to it being
a key material transaction with members of key
management and other personnel, the valuation of
which involves significant judgement and accounting
estimation.
We therefore identified such expenses as a key area of
focus.
Our procedures included, amongst others:
• Enquiring and obtaining confirmations from Key
SBP
regarding
their
Management Personnel
remuneration during the period.
• Reviewing minutes of directors and shareholder
meetings and ASX announcements relating to the
approval of such arrangements undertaken during
the financial year.
• Reviewing remuneration documents & assessing the
valuation methodology used by management to
estimate the fair value of SBP, including testing the
information provided, assessing the
integrity of
appropriateness of the key assumptions input into
the valuation model and recalculating the valuation
using the Black Scholes Model.
• Assessing whether the SBP have been appropriately
financial
the
for
in
classified and accounted
statements.
We also assessed the adequacy of other related
disclosures in the financial statements.
Accounting for Capitalised Exploration & Evaluation Assets
Refer to Note 11 Exploration & Evaluation Assets
At 30 June 2020, the Group’s statement of financial
position includes capitalised exploration and evaluation
assets of approximately $24.3 million, representing the
Group’s single largest asset or 75% of total assets.
The ability to recognise and to continue to defer
exploration and evaluation assets under AASB 6:
Exploration for and Evaluation of Mineral Resource is
impacted by the Group’s ability, and intention, to
continue to explore the tenements or its ability to
realise this value through development or sale.
Due to the significance of these assets and the
subjectivity involved in assessing the ability to continue
to defer these assets, this is considered a key audit
matter.
We addressed the Group’s assessment of the ability to
continue to defer the exploration and evaluation assets
under AASB 6 by specifically ensuring that:
• the Group has the ongoing right to explore in the
interests which
relevant exploration areas of
relevant
and
obtaining
included
documentation such as tenement registers (via
Department of Mines WA) & other agreements.
assessing
• Tested a sample of exploration & evaluation
to
expenditures capitalised during
supporting documentation.
the year
• the Group is committed to continue exploration and
evaluation activity in the relevant exploration areas
of interest including assessing their exploration and
future development expenditures that have been
and discussions with
either budgeted
management as to the intentions and strategy of the
We also reviewed the Group’s ASX
Group.
announcements and the Pre-Feasibility Study (PFS)
report for the Warrawoona Gold Project.
for
• Assessing the carrying value of these assets for any
in AASB 6)
impairment (set out
indicators of
including comparing against the Company’s market
capitalisation at balance date and the PFS valuation.
We also assessed
disclosures contained in the financial report.
the appropriateness of
the
P a g e | 74
Other Information
The directors are responsible for the other information. The other information comprises the information
included in the Group’s annual report for the year ended 30 June 2020 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.
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 has no realistic alternative but to do so.
Auditor’s Responsibilities for the Audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from
material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our
opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in
accordance with the Australian Auditing Standards will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate,
they could reasonably be expected to influence the economic decisions of users taken on the basis of this
financial report.
A further description of our responsibilities for the audit of the financial report is located at the Auditing and
Assurance Standards Board website at: https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf.
This description forms part of our audit report.
P a g e | 75
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 30 June
2020.
In our opinion, the Remuneration Report of Calidus Resources Limited, for the financial year ended 30 June
2020 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.
SL TAN
PARTNER
Signed at Perth on the 11th day of September 2020
MOORE AUSTRALIA AUDIT (WA)
CHARTERED ACCOUNTANTS
P a g e | 76
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
ANNUAL REPORT
30 June 2020
Additional ASX Information as at 8 September 2020
The following additional information is required by the Australian Securities Exchange in respect of listed public companies. As
at 8 September 2020 there were 3,268 holders of Ordinary Fully Paid Shares.
Voting Rights
The voting rights attached to each class of equity security are as follows:
◼ Ordinary shares: Each ordinary share is entitled to one vote when a poll is called, otherwise each member present at a
meeting or by proxy has one vote on a show of hands.
◼
Listed Options, Unlisted Options and Performance Shares: Options and performance shares do not entitle the holders to
vote in respect of that equity instrument, nor participate in dividends, when declared, until such time as the options are
exercised or performance shares convert and subsequently registered as ordinary shares.
20 Largest Shareholders — Ordinary Shares as at as at 8 September 2020
Ran
k
1
2
Name
ALKANE RESOURCES LTD
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
3 MRS ELEANOR JEAN REEVES
4
CITICORP NOMINEES PTY LIMITED
5
6
7
8
9
10
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
HEDGEHOG MANAGEMENT PTY LTD
NATIONAL NOMINEES LIMITED
BNP PARIBAS NOMINEES PTY LTD
BEATONS CREEK GOLD PTY LTD
CS THIRD NOMINEES PTY LIMITED
11 MR BRIAN MICHAEL MORITZ
12
NARNIA HOLDINGS LIMITED
13 MR SIMON PATRICK BOWMAN
14 MR STACEY RADFORD
15
CF FOURTH NOMINEES PTY LIMITED
16 MR PHILLIP RICHARD PERRY
17 MRS WINSOME MARY SANTA MARIA
18
PROCUREMENT SOLUTIONS LIMITED
19
20
NEWECONOMY COM AU NOMINEES LIMITED <900 ACCOUNT>
DISCOVERY SERVICES PTY LTD
Number of
Ordinary Fully
Paid Shares
% Held of Ordinary
Issued Capital
34,118,584
27,153,643
16,819,044
11,487,511
10,967,053
9,246,474
7,335,804
6,354,989
5,138,537
5,025,731
2,946,456
2,762,587
2,500,000
2,472,576
2,326,566
1,941,762
1,910,344
1,815,135
1,563,995
1,535,000
12.67%
10.09%
6.25%
4.27%
4.07%
3.44%
2.73%
2.36%
1.91%
1.87%
1.09%
1.03%
0.93%
0.92%
0.86%
0.72%
0.71%
0.67%
0.58%
0.57%
Total
155,421,791
57.74%
P a g e | 77
ANNUAL REPORT
30 June 2020
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
Substantial Ordinary Shareholders as at 8 September 2020
Name
ALKANE RESOURCES LTD
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
MRS ELEANOR JEAN REEVES
Number of Ordinary
Fully Paid Shares Held
% Held of Ordinary
Issued Capital
34,118,584
27,153,643
16,819,044
12.67%
10.09%
6.25%
Distribution of Ordinary Shareholders as at 8 September 2020
Holding Range
Holders
Total Units
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 – and over
297
1,074
588
1,093
216
3,268
134,378
3,121,652
4,916,380
37,482,896
223,526,269
269,181,575
% Issued
Ordinary Capital
0.05%
1.16%
1.83%
13.92%
83.04%
100.00%
Unmarketable Parcels – as at 8 September 2020 there were 167 holders with less than a marketable parcel of shares.
On-Market Buy-Back
There is no current on-market buy-back.
Unquoted Securities
As at 8 September 2020 the following unquoted securities are on issue:
1,200,000 Performance Rights – 3 Holders
Holders with more than 20%
Holder Name
HADREY PTY LTD
STEPHEN SHEPPARD
GRANT MCEWEN
Holding
%
900,000
42.86%
600,000
600,000
28.57%
28.57%
7,150,000 Incentive Options Expiring 27 December 2021 @ Nil – 2 Holders
Holders with more than 20%
Holder Name
ELEANOR JEAN REEVES
HADREY PTY LTD
Holding
%
3,000,000
41.96%
2,700,000
37.76%
2,700,000 Incentive Options Expiring 30 January 2025 @ Nil – 1 Holder
Holders with more than 20%
Holder Name
RICHARD W S HILL
Holding
2,700,000
%
100%
500,000 Incentive Options Expiring 4 June 2025 @ Nil – 1 Holder
Holders with more than 20%
Holder Name
BENJAMIN G PLAYFORD
Holding
500,000
%
100%
P a g e | 78
CALIDUS RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 98 006 640 553
ANNUAL REPORT
30 June 2020
600,000 Incentive Options Expiring 5 August 2025 @ Nil – 1 Holder
Holders with more than 20%
Holder Name
DONALD R RUSSELL
Holding
600,000
%
100%
170,000 Incentive Options Expiring 12 August 2025 @ Nil – 1 Holder
Holders with more than 20%
Holder Name
DEAN A VALLVE
Holding
170,000
%
100%
388,500 Executive Options Expiring 27 December 2021 @ Nil – 2 Holders
Holders with more than 20%
Holder Name
ELEANOR JEAN REEVES
HADREY PTY LTD
Holding
%
150,000
38.61%
150,000
38.61%
500,000 NED Options Expiring 27 December 2023 @ Nil – 2 Holders
Holders with more than 20%
Holder Name
MARCON INVESTMENTS (WA)
PTY LTD
KADAJE INVESTMENTS PTY LTD
Holding
300,000
%
60%
200,000
40%
150,000 Executive Options Expiring 30 January 2022 @ Nil
Holders with more than 20%
Holder Name
MR RICHARD W S HILL
Holding
150,000
%
100%
4,200,000 Options Expiring 18 April 2021 @ $0.02 escrowed for a period of 24 months from quotation – 4 Holders
Holders with more than 20%
Holder Name
ATTOLLO INVESTMETNS PTY LTD
BUZZ CAPITAL PTY LTD < ZI
VESTMENT A/C >
SUNSET TIDAL PTY LTD
ROMFAL SIFAT PTY LTD
ASX Listing Rule 4.10.19
Holding
1,000,000
%IC
23.810%
1,000,000
23.81%
1,000,000
23.81%
1,000,000
23.81%
The Company has used its cash and net assets in a form readily convertible to cash in hand at the time of reinstatement of the
Company’s securities to quotation in a way consistent with its business objectives.
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