Canyon Resources Limited
ABN 13 140 087 261
Annual Report
30 June 2023
Canyon Resources Limited
Corporate directory
30 June 2023
Directors
Mark Hohnen - Non-executive Chairman
David Netherway - Non-executive Director
Peter Su - Non-executive Director
Scott Phegan - Non-executive Director
Company secretary
Matt Worner
Registered office
Principal place of business
Share register
Auditor
Solicitors
945 Wellington Street
West Perth, Western Australia, 6005
T: +61 8 9322 7600
945 Wellington Street
West Perth, Western Australia, 6005
T: +61 8 9322 7600
Computershare Limited
Level 17, 221 St Georges Terrace
Perth, Western Australia, 6000
T: +61 8 9323 2000
F: +61 9323 2033
www.computershare.com.au
HLB Mann Judd (WA Partnership)
Level 4, 130 Stirling Street
Perth, Western Australia, 6000
Gilbert + Tobin
Level 16 Brookfield Place
Tower 2, 123 St Georges Terrace
Perth WA 6000
Stock exchange listing
Canyon Resources Limited shares are listed on the Australian Securities Exchange (ASX
code: CAY)
Website
www.canyonresources.com.au
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Canyon Resources Limited
Contents
30 June 2023
Chairman's Letter
Directors' report
Auditor's independence declaration
Consolidated statement of profit or loss and other comprehensive income
Consolidated statement of financial position
Consolidated statement of changes in equity
Consolidated statement of cash flows
Notes to the consolidated financial statements
Directors' declaration
Independent auditor's report to the members of Canyon Resources Limited
Corporate governance statement
Shareholder information
Interest in mineral permits
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Canyon Resources Limited
Chairman's Letter
30 June 2023
Dear Shareholder,
It is my pleasure to present Canyon Resources Limited’s Annual Report for the year ended 30 June 2023.
The past year has seen some important developmental changes in your Company.
As shareholders are aware, the Company’s focus has been and remains on working towards the grant of a Mining Convention
and Mining Permit for its flagship Minim Martap Bauxite Project in Cameroon and Canyon continues to engage at all levels of
government in this regard. Whilst progress on this matter remains frustrating to all concerned, Canyon has over the last year
made some strong strides with the securing of an initial strategic investment from Eagle Eye Asset Holdings Pte. Ltd (EEA).
In December 2022, Canyon was pleased to secure an initial $12.1 million investment from EEA. EEA represents a highly
attractive, long term strategic partner, with capability to assist Canyon with project funding solutions to facilitate the Minim
Martap Project moving towards development.
As a further example of its confidence in and commitment to the Minim Martap Project, in August 2023, EEA agreed to commit
a further minimum of $24.7 million dollars, potentially increasing up to $59.7 million on exercise of options.
EEA has a successful track record in investment and development of projects in Africa and holds a long-term vision to develop
an integrated African bauxite and aluminium value chain. In the Company’s view, securing a partner of the quality and funding
capability of EEA is central to demonstrating to the Government of Cameroon of Canyon’s ability to move the Minin Martap
Project forward and into the mining phase and EEA continues to support the progression of the Minim Martap Project along
the approval process.
The additional investment by EEA is subject to shareholder approval later in the year and investors will be provided with clear
details and information in respect of the effect of this planned investment on the Company ahead of the shareholder meeting.
I extend my thanks to CEO, Jean-Sebastien Boutet and his team for progress over the last year and in particular for securing
the important strategic partner support from EEA.
I look forward to working with the Canyon team both here in Australia and in Cameroon and EEA in moving the Company to its
next stage of development and to providing a genuine alternative supply of high-grade West African bauxite.
I thank all Canyon shareholders for their ongoing support and look forward to the continuing growth and development of your
Company.
Regards
Mark Hohnen
Non-Executive Chairman
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Canyon Resources Limited
Directors' report
30 June 2023
The Directors present their report, together with the financial statements, on the consolidated entity (referred to hereafter
as 'the Group') consisting of Canyon Resources Limited (referred to hereafter as 'the Company' or 'parent entity') and the
entities it controlled at the end of, or during, the year ended 30 June 2023.
Directors
The following persons were Directors of Canyon Resources Limited during the whole of the financial period and up to the
date of this report, unless otherwise stated:
Mark Hohnen - Non Executive Chairman (appointed 8 August 2022)
Cliff Lawrenson - Non Executive Chairman (resigned 8 August 2022)
Phillip Gallagher - Managing Director (resigned 11 July 2022)
David Netherway - Non-Executive Director
Peter Su - Non-Executive Director
Scott Phegan - Non-Executive Director (appointed 8 August 2022)
Steven Zaninovich - Non-Executive Director (resigned 8 August 2022)
Principal activities
The principal activities of the entities within the Group during the year were continued bauxite exploration and engineering
studies.
Dividends
There were no dividends paid, recommended or declared during the current or previous financial year.
Review of operations
The loss for the Group after providing for income tax amounted to $4,986,711 (30 June 2022: $12,775,411).
Minim Martap Project
During the year, Canyon’s focus was on securing the grant of a Mining Convention for its 100% owned Minim Martap Bauxite
Project (The Project).
The Company continues to work alongside the Government of Cameroon and strategic investor Eagle Eye Asset Holdings Pte.
Ltd (EEA) for the execution of the Mining Convention.
The Project is situated adjacent to the Camrail rail line linking the region to the accessible and available Atlantic port of Douala.
The rail line is currently underutilised and coupled with the existing port of Douala, supports a low capex, low opex solution
for the delivery of very high grade, low contaminant, seaborne bauxite to market to fuel the large and growing aluminium
industry.
A summary of the highlights of the past year's operations is provided below.
Positive interaction with Government and local communities
With Canyon’s primary focus being on the grant of the Mining Convention and Mining Permits for the Project, the Canyon
team, alongside representatives of strategic investor, EEA, held multiple in-country meetings with the Cameroon Government
to continue to apply pressure for the granting of relevant permits for the development of Minim Martap.
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Canyon Resources Limited
Directors' report
30 June 2023
Meetings included working sessions with the interim Minister of Mines in the month of May 2023.
Figure 1: Working group session between Canyon Resources and the Cameroon Minister of Mines
Canyon continues to receive strong local support from regional leaders in the Project area. Company CEO, Jean-Sebastien
Boutet and Camalco General Manager, Mr. Andre Henry, travelled to the Minim Martap project site and met with local
regional leaders, the préfet of Martap and the Lamido of Ngaoundéré. These local leaders maintain a respected influence at
the local community level and within the national government. Importantly, they remain supportive of the project and
continue to lobby for its approval.
Figure 2: Canyon team members meeting with the Lamido of Ngaoundéré
Grant of Certificate of Environmental Compliance
As announced on 24 October 2022, Canyon has received a Certificate of Environmental Compliance (CEC) for the Minim
Martap Bauxite Project from the Ministry of Environment.
The granted CEC was a result of a detailed Environmental Social Impact Assessment (ESIA) conducted by the Company. The
ESIA included extensive public consultation of multiple stakeholders and local communities. The process has strengthened
the relationship between Canyon and the community in the Adamawa region.
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Canyon Resources Limited
Directors' report
30 June 2023
MOU with the Port of Douala
On 9 January 2023, Canyon announced the signing of a Memorandum of Understanding (‘MOU’) outlining a declaration of
intent with the Port Authority of Douala (‘PAD’) in regard to the development of infrastructure at the Port of Douala-Bonabéri.
The Port Authority of Douala is responsible for the development and control of port security and operations. As one of the
major port operations of Cameroon, it is recognised that development of the Port of Douala is a catalyst for increasing the
competitiveness of the national economy of Cameroon. Primarily, the PAD aims to deliver an efficient operation that services
the region by acting as a logistics hub for the Gulf of Guinea.
This MOU outlines a framework for PAD and Canyon to understand and work towards a partnership in the future development
and upgrade to the existing Industrial Port area on the right bank on Wouri River. This includes pre-feasibility studies that will
be arranged by Canyon. Future feasibility studies will investigate the design, financing, construction, operation and
maintenance of a mineral terminal for the transport, storage, handling and export of bauxite from the Minim Martap Project
at the Port of Douala-Bonabéri.
Upon the grant of a Mining Permit for the Minim Martap mining areas, in accordance with Section 59 of the Mining Code, an
entity of the State will be granted 10% ownership of the special purpose Joint Venture Company formed for that purpose,
free of charge. The Mining Permit is, upon grant, transferred by Camalco to this new company. Up to an additional 25%
ownership of the new company may be acquired via direct investment by the entity of the State under terms and conditions
mutually agreed by the parties, and with the same rights and obligations as the other shareholders.
Makan and Ngaoundal Bauxite Research Permits
In addition to the Minim Martap Bauxite Project, the Company has continued to progress early-stage resource definition work
and the identification of long-term Direct Shipping Ore (DSO) options at the Makan Permit. To date, the Makan Permit has
not been as extensively explored as the Ngaoundal and Minim Martap Permits. As announced on 7 October 2022, the
exploration activities for a new exploration program will focus on defining sufficient bauxite mineralization to develop
sustainable long-term DSO operations to be included in the Minim Martap Bauxite Project.
The exploration activities planned will satisfy the requirements to maintain the Permit under the terms of the extension
granted in February 2022. The program aims to improve the resource knowledge on this ground, eventually growing the
existing contribution of the Makan Permit into the Minim Martap mining schedule. The Company is making plans for a drilling
campaign, which is expected to commence in the coming months and upon completion of the current wet season.
Reserves and Resources
The Project is validated by the Ore Reserve estimate announced 25 May 2021 prepared by a Competent Person, in
accordance with the JORC Code (2012) and is stated as:
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Canyon Resources Limited
Directors' report
30 June 2023
The underlying Mineral Resource estimate announced 11 May 2021, prepared by a Competent Person, in accordance with
the JORC Code (2012) is stated as:
Competent Person’s Statement – Ore Reserves
The information in this report that relates to Ore Reserves is based on information compiled or reviewed by Mr John Battista,
a Competent Person who is a Member and Chartered Professional (Mining) of the Australasian Institute of Mining and
Metallurgy and Mr Andrew Hutson, a Competent Person who is a Fellow of the Australasian Institute of Mining and Metallurgy
and is currently employed by Resolve Mining Solutions Mr Battista and Mr Hutson have sufficient experience relevant to the
style of mineralisation and type of deposit under consideration and to the activity which is being undertaken to qualify as a
Competent Person as defined in the 2012 edition of the Australasian Code for the Reporting of Exploration Results, Mineral
Resources, and Ore Reserves (JORC Code).
Competent Person’s Statement – Mineral Resources
The information in this report that relates to mineral resources is based on information compiled or reviewed by Mr Mark
Gifford, an independent Geological expert consulting to Canyon Resources Limited. Mr Mark Gifford is a Fellow of the
Australian Institute of Mining and Metallurgy and has sufficient experience which is relevant to the style of mineralisation
and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as
defined in the 2012 edition of the Australasian Code of Reporting of Exploration Results, Mineral Resources and Ore Reserves
(JORC Code).
Mineral Resource Estimate
The data in this report that relates to the Mineral Resource estimates for the Minim Martap Bauxite Project is based on
information in the Resources announcement of 11 May 2021 and available to view on the Company’s website and 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 announcement and, in the case of estimates of Mineral Resources, that all material assumptions and
technical parameters underpinning the estimates in the original market announcement continue to apply and have not
materially changed. The Company confirms that the form and the context in which the Competent Person’s findings are
presented have not been materially modified from the original market announcement.
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Canyon Resources Limited
Directors' report
30 June 2023
Ore Reserve estimate
The data in this report that relates to the Ore Reserve estimate estimates for the Minim Martap Bauxite Project is based on
information in the maiden Ore Reserve announcement of 25 May 2021 and available to view on the Company’s website and
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 announcement and, in the case of estimates of Ore Reserves, that all material assumptions and technical
parameters underpinning the estimates in the original market announcement continue to apply and have not materially
changed. The Company confirms that the form and the context in which the Competent Person’s findings are presented have
not been materially modified from the original market announcement.
Forward-looking statements
All statements other than statements of historical fact included in this report including, without limitation, statements
regarding future plans and objectives of Canyon, are forward-looking statements. When used in this report, forward-looking
statements can be identified by words such as “anticipate”, “believe”, “could”, “estimate”, “expect”, “future”, “intend”,
“may”, “opportunity”, “plan”, “potential”, “project”, “seek”, “will” and other similar words that involve risks and
uncertainties.
These statements are based on an assessment of present economic and operating conditions, and on a number of
assumptions regarding future events and actions that are expected to take place. Such forward-looking statements are not
guarantees of future performance and involve known and unknown risks, uncertainties, assumptions and other important
factors, many of which are beyond the control of the Company, its directors and management of Canyon that could cause
Canyon’s actual results to differ materially from the results expressed or anticipated in these statements.
Canyon cannot and does not give any assurance that the results, performance or achievements expressed or implied by the
forward-looking statements contained in this report will actually occur and investors are cautioned not to place undue
reliance on these forward-looking statements. Canyon does not undertake to update or revise forward-looking statements,
or to publish prospective financial information in the future, regardless of whether new information, future events or any
other factors affect the information contained in this report, except where required by applicable law and stock exchange
listing requirements.
Corporate
Successful share placements completed
$12.1 million placement to strategic investor, Eagle Eye Asset Holdings Pte. Ltd.
On 21 December 2022, Canyon announced that it had secured a strategic placement of ~$12.1m at $0.06 per share with Eagle
Eye Asset Holdings Pte. Ltd (“EEA”). EEA (branded as Fortuna Holdings SFO) is incorporated and based in Singapore and with
branch offices in Dubai. EEA has a successful track record of developing projects in Africa and in other geographies and has a
long-term vision to develop an integrated bauxite and aluminium value chain from Africa.
The strategic placement was conducted at a significant price premium (+41.8%) to Canyon’s 30-day VWAP of $0.042 up to
and including 20 December 2022. Each Share issued under the strategic placement was, subject to shareholder approval,
entitled to receive an attaching option (exercise price of $0.07 per option and expiry date of 10 August 2025). The placement
of shares to EEA was completed on 22 December 2023 and EEA became Canyon’s largest shareholder with 19.9% of the
Company’s issued share capital.
EEA represents a highly attractive, long term strategic partner, with capability to assist Canyon with project funding solutions
to facilitate the Minim Martap Project moving towards development.
As part of the strategic placement to EEA, 202,900,000 unlisted options exercisable at $0.07 each on or before 10 August
2025 were issued on 17 March 2023, and upon receipt by the Company of required shareholder approval.
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Canyon Resources Limited
Directors' report
30 June 2023
Issue of Shares and Options under Tranche 2 of June 2022 Placement
5,444,443 ordinary fully paid shares were issued on 7 September 2022 at an issue price of $0.045 raising $245,000 before
costs. The shares issued were Tranche 2 of the Placement announced on 21 June 2022, and were entitled to one free attaching
option.
104,636,355 unlisted options exercisable at $0.07 each on or before 10 August 2024 were issued on 7 September 2022. The
options were part of the placement announced on 21 June 2022 where each share was entitled to one free attaching option.
Management changes
Managing Director Phillip Gallagher resigned as a Director on 11 July 2022.
10,000,000 Performance Rights were issued to CEO Jean-Sebastien Boutet on 18 July 2022 with the following vesting
conditions:
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●
●
●
●
●
●
●
1,000,000 - achievement of a 10-day Volume Weighted Average Price ('VWAP') of $0.10
1,000,000 - achievement of a 10-day VWAP of $0.15
1,000,000 - achievement of a 10-day VWAP of $0.20
1,000,000 - achievement of a 10-day VWAP of $0.25
1,000,000 - after 12 months of continuous employment
1,000,000 - after 24 months of continuous employment
1,000,000 - after 36 months of continuous employment
1,000,000 - announcement of a fully approved mining licence
1,000,000 - announcement of a completed rail access agreement
1,000,000 - executed binding off take agreement for a minimum 2MT for a 12 month period.
On 8 August 2022 Non-executive Chairman Cliff Lawrenson and Non-executive Director Steven Zaninovich resigned whilst
Mark Hohnen was appointed as Non-executive Chairman and Scott Phegan as Non-Executive Director.
Matters subsequent to the end of the financial year
Further Strategic Placement to EEA
On 17 August 2023 it was announced that a Subscription Agreement was entered into with Eagle Eye Asset Holdings Pte Ltd
("EEA"), whereby EEA has agreed to subscribe for 150,000,000 new fully paid ordinary shares at $0.07 per Share ("Placement
Shares") and to exercise its existing 202,900,000 options exercisable at $0.07 to convert into fully paid ordinary shares
("Exercise Shares"). Following satisfaction of conditions including shareholder approval, will result in the company raising
$24.7m before costs. The Company will also issue EEA with 500,000,000 new unlisted options exercisable at $0.07 per share
on or before 26 December 2026 ("New Options").
The issue of the Placement Shares, Exercise Shares and Shares on exercise of the New Options and the resulting increase in
EEA’s relevant interest in the Company is subject to Canyon shareholder approval under item 7 of section 611 of
the Corporations Act 2001 (Cth). The issue of the New Options is subject to Canyon shareholder approval for the purposes of
ASX Listing Rule 7.1. The necessary shareholder approvals will be sought at an extraordinary general meeting to be held in or
around November 2023. A notice of meeting, accompanied by an independent expert’s report, will be provided to
shareholders in due course.
The exercise of the New Options will be subject to:
* the grant of the Mining Licence for the Minim Martap Project ("Project"); and
* a binding contract for port access and rail transportation of product on terms relevant to the Project and customary in the
Central African market being executed by the Company and counterparties.
4,000,000 options exercisable at $0.20 each on or before 7 September 2023 expired unexercised.
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Canyon Resources Limited
Directors' report
30 June 2023
Likely developments and expected results of operations
Information on likely developments in the operations of the Group and the expected results of operations have not been
included in this report because the Directors believe it would be likely to result in unreasonable prejudice to the Group.
Business risks
The Group is engaged in mineral exploration activities which, by their very nature, are speculative. Due to the high-risk nature
of the Group’s business and the present stage of the various projects, the Board is unable to provide certainty of the expected
results of these activities, or that any or all of these likely activities will be achieved. Some of the key risks which the Group is
subject to are summarised below.
Overseas business activities and country risk (Geopolitical Risk)
The Group engages in exploration activities outside of Australia, mainly in Cameroon. The success of the Group's operation
depends on the political stability in this country and the availability of qualified and skilled workforce to support operations.
While the operations of the Group in this country is currently very stable, a change in the government may result in changes
to the foreign investment laws and these assets could have an adverse effect on the Group's operational results.
To manage this risk, the Group ensures that all significant transactions in this country are supported by robust contracts
between the company and third parties. We have developed a mechanism to counter legal risk, where foreign subsidiaries
and management can receive appropriate legal guidance regarding matters such as important agreements and lawsuits in
foreign countries.
Exploration and development risks
Mineral exploration and development is a speculative and high-risk undertaking that may be impeded by circumstances and
factors beyond the control of the Group. As the Group is an exploration company, there can be no assurance that exploration
on the Projects, or any other exploration tenure that may be acquired in the future, will result in the discovery of an economic
mineral resource. Even if an apparently viable mineral resource is identified, there is no guarantee that it can be economically
exploited.
Any resource estimate will be an expression of judgment based on knowledge, experience and industry practice. By their very
nature, resource estimates are imprecise and depend to some extent on interpretations, which may prove to be inaccurate.
If the Group undertakes scoping, pre-feasibility, definitive feasibility and bankable feasibility studies that confirm the
economic viability of a Project, there is still no guarantee that the Project will be successfully brought into production as
assumed or within the estimated parameters in the study (e.g. operational costs and commodity prices) once production
commences.
Additional requirements for capital
Additional funding may be required if costs exceed the Group's estimates and will be required once those funds are depleted.
To effectively implement its business and operations plans in the future, to take advantage of opportunities for project
development, acquisitions, joint ventures or other business opportunities and to meet any unanticipated liabilities or
expenses which the Company may incur, additional equity or other finance may be required. The Company may seek to raise
further funds through equity or debt financing, joint ventures, production sharing arrangements, royalty streaming or other
means, in future.
Failure to obtain sufficient financing for the Group's activities may result in delay and indefinite postponement of exploration,
development or production on the Group's properties or even loss of a property interest. There can be no assurance that
additional finance will be available when needed or, if available, the terms of the financing might not be favourable to the
Group and might involve substantial dilution to Shareholders.
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Canyon Resources Limited
Directors' report
30 June 2023
Climate risk
There are a number of climate-related factors that may affect the operations and proposed activities of the Group. The climate
change risks particularly attributable to the Group include:
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the emergence of new or expanded regulations associated with the transitioning to a lower-carbon economy and market
changes related to climate change mitigation. The Group may be impacted by changes to local or international
compliance regulations related to climate change mitigation efforts, or by specific taxation or penalties for carbon
emissions or environmental damage. These examples sit amongst an array of possible restraints on industry that may
further impact the Group and its profitability. While the Group will endeavour to manage these risks and limit any
consequential impacts, there can be no guarantee that the Group will not be impacted by these occurrences; and
climate change may cause certain physical and environmental risks that cannot be predicted by the Group, including
events such as increased severity of weather patterns and incidence of extreme weather events and longer-term physical
risks such as shifting climate patterns. All these risks associated with climate change may significantly change the industry
in which the Group operates
Insurance and uninsured risks
Although the Group maintains insurance to protect against certain risks in such amounts as it considers to be reasonable, its
insurance will not cover all the potential risks associated with its operations and insurance coverage may not continue to be
available or may not be adequate to cover any resulting liability. It is not always possible to obtain insurance against all such
risks and the Group may decide not to insure against certain risks because of high premiums or other reasons.
Reliance on key personnel
The responsibility of overseeing the day-to-day operations and the strategic management of the Group depends substantially
on its senior management and its key personnel. There can be no assurance that there will be no detrimental effect on the
Group if one or more of these key employees cease their employment or other roles in the Group.
The Group may not be able to replace its senior management or key personnel with persons of equivalent expertise and
experience within a reasonable period of time or at all and the Group may incur additional expenses to recruit, train and
retain personnel. Loss of such personnel may also have an adverse effect on the performance of the Group.
These risks are mitigated by providing competitive compensation packages for similar sized projects and incentives where
salaries cannot be matched against other industries.
Environmental regulation
With respect to its environmental obligations regarding its exploration activities the Group endeavours to ensure that it
complies with all regulations when carrying out any exploration work and is not aware of any breach at this time.
Information on Directors
Name:
Title:
Experience and expertise:
Mark Hohnen
Non-Executive Chairman (appointed 8 August 2022)
Mr Hohnen has been involved in the mineral resource sector since the late 1970s and
has extensive international business experience in a wide range of industries including
mining and exploration, property, investment, software and agriculture. Mr Hohnen has
served as Non-executive Chairman of Boss Resources Ltd (ASX:BOE), and was also a
director of Kalahari Minerals and Extract Resources, having successfully negotiated the
sale of both companies to Taurus Minerals Ltd.
Non-Executive Chairman of Parabellum Resources Ltd (ASX:PBL) - appointed 1 July 2021
Other current directorships:
Former directorships (last 3 years): Bacanora Lithium Plc (LSE: BCN) – resigned in December 2021
450,000 ordinary shares
Interests in shares:
1,000,000 unlisted options exercisable at $0.09 each on or before 2 December 2025
Interests in options:
1,000,000 unlisted options exercisable at $0.12 each on or before 2 December 2025
1,000,000 unlisted options exercisable at $0.17 each on or before 2 December 2025
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Canyon Resources Limited
Directors' report
30 June 2023
Name:
Title:
Qualifications:
Experience and expertise:
Scott Phegan
Non-Executive Director (appointed 8 August 2022)
BE Chem
Mr Phegan has held multiple technical, project, strategic and executive roles within the
bauxite and alumina industries over a 30-year international career with Alcoa. In his
capacity as Global Director for Process Design and Development, he was responsible for
design and commissioning of multibillion-dollar refining expansions and refining
development projects in Australia, Middle East, Brazil, Guinea, Ghana, Jamaica and
Vietnam.
Mr Phegan is intimately familiar with the bauxite industry supply lines, customers, and
mining practices in relation to alumina refining and project development, as well as the
bauxite business development pathway having supported customer development
activities in China and Vietnam over several years.
His experience extends across the full project execution lifecycle from study phases
through to construction, commissioning and operations.
None
Other current directorships:
Former directorships (last 3 years): None
Interests in shares:
Interests in options:
Nil
Nil
Name:
Title:
Qualifications:
Experience and expertise:
Other current directorships:
David Netherway
Non-Executive Director (Appointed 17 March 2014)
B.Eng (Mining), CDipAF, F.Aus.IMM
Mr Netherway is a mining engineer with over 40 years of experience in the mining
industry and until the takeover by Gryphon Minerals Limited, was CEO of Shield Mining
Limited, an ASX listed exploration company. He was involved in the construction and
development of the New Liberty, Iduapriem, Siguiri and Kiniero gold mines in West
Africa and has extensive mining experience in Africa, Australia, China, Canada, India and
the former Soviet Union.
Mr Netherway was the Chairman of Afferro Mining, a UK listed iron ore exploration and
development company in Cameroon until December 2013 when Afferro was subject to
a US$200 million takeover by AIM listed IMIC plc.
Lead Independent Director of Elemental Altus Royalties Corp. (ELE: TSX-V), Canyon’s
joint venture partner on the Birsok Project in Cameroon - appointed 1 July 2007.
Non-executive Director of Kore Potash Ltd (K2P:AIM, ASX & JSE) - appointed 14
December 2017.
Former directorships (last 3 years): None
Interests in shares:
Interests in options:
14,968,570 ordinary shares
555,555 unlisted options exercisable at $0.07 each on or before 10 August 2024
Name:
Title:
Qualifications:
Experience and expertise:
Peter Su
Non-Executive Director (Appointed 16 September 2020)
Hons. B.Comm
Mr Su is actively involved in property investment and development in Australia and
overseas, he is a strategic investor with a diverse range of business interests in Australia
and overseas. The Su family have historically held commercial interest in bauxite and
alumina refining in China.
None
Other current directorships:
Former directorships (last 3 years): None
Interests in shares:
Interests in options:
67,545,950 ordinary shares
4,444,444 unlisted options exercisable at $0.07 each on or before 10 August 2024
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Canyon Resources Limited
Directors' report
30 June 2023
Name:
Title:
Experience and expertise:
Steven Zaninovich
Non-Executive Director (Resigned 8 August 2022)
Mr Zaninovich has spent more than 20 years in project development, maintenance and
operational readiness in the mining industry including, most recently, as Project
Director of Tawana Resources, responsible for the delivery of the Bald Hill Lithium
Project. Prior to that, he served as Chief Operating Officer with Gryphon Minerals
(“Gryphon”) before assuming the role of Vice President of Major Projects, and
becoming part of the Executive Management Team, at Teranga Gold Corporation
(“Teranga”) following its acquisition of Gryphon Minerals. During his time with Teranga
and Gryphon, and also earlier in his career, Mr Zaninovich gained specific expertise in
the development of multiple mining operations across various commodities and
jurisdictions in West Africa. He has also taken on consultant project management roles
for companies including BHP Billiton, Newmont Mining and Gold Fields.
Mr Zaninovich’s responsibilities during previous senior executive roles have included
operational running of companies, business and strategic planning, feasibility studies
and project development, site exploration operations, health and safety, environmental
and social responsibility, human resources, risk management, project generation,
strategic direction and procurement and contracts.
n/a
Other current directorships:
Former directorships (last 3 years): n/a
n/a
Interests in shares:
Name:
Title:
Qualifications:
Experience and expertise:
Cliff Lawrenson
Non-Executive Chairman (Resigned 8 August 2022)
Hons. B.Comm
Mr Lawrenson is an experienced mining professional who was previously the Managing
Director of Atlas Iron Ltd from 2017 until its acquisition by Hancock Prospecting Pty Ltd.
Prior to Atlas Iron, Mr Lawrenson was Managing Director of a number of ASX listed
companies in the mining and mining services sectors. Mr Lawrenson was a senior
executive of CMS Energy Corporation in the United States of America and Singapore
and this was preceded by an investment banking career.
n/a
Other current directorships:
Former directorships (last 3 years): n/a
n/a
Interests in shares:
Name:
Title:
Qualifications:
Experience and expertise:
Phillip Gallagher
Managing Director (Resigned 11 July 2022)
B.Bus
Mr Gallagher has had extensive experience in senior commercial and operational roles
in both private and public companies.
Mr Gallagher is the founder of Canyon Resources, and was the Company’s Managing
Director since inception, until the date of his resignation.
n/a
Other current directorships:
Former directorships (last 3 years): n/a
n/a
Interests in shares:
'Other current directorships' quoted above are current directorships for listed entities only and excludes directorships of all
other types of entities, unless otherwise stated.
'Former directorships (last 3 years)' quoted above are directorships held in the last 3 years for listed entities only and excludes
directorships of all other types of entities, unless otherwise stated.
13
Canyon Resources Limited
Directors' report
30 June 2023
Company secretary
Matt Worner
LLB, B.Bus
Appointed 16 June 2021
Mr Worner is a former lawyer, with a broad experience in IPOs, capital raising, ASX Listing Rules and Corporations Act
issues. He has held management, company secretarial and board positions with various ASX and AIM listed companies. He
maintains strong connections with brokers in both Australia and London and is currently a director of Talon Petroleum Limited
(ASX:TPD).
Meetings of Directors
The number of meetings of the Company's Board of Directors ('the Board') held during the year ended 30 June 2023, and the
number of meetings attended by each Director were:
Mark Hohnen
Cliff Lawrenson*
Phillip Gallagher**
David Netherway
Peter Su
Scott Phegan
Steven Zaninovich*
Full Board
Audit and Risk Committee
Attended
Held
Attended
Held
5
-
-
5
1
5
-
5
-
-
5
5
5
-
2
-
-
2
-
2
-
2
-
-
2
2
2
-
Held: represents the number of meetings held during the time the Director held office.
resigned 8 August 2022
*
** resigned 11 July 2022
Remuneration report (audited)
The remuneration report details the key management personnel remuneration arrangements for the Group, in accordance
with the requirements of the Corporations Act 2001 and its Regulations.
Key management personnel are those persons having authority and responsibility for planning, directing and controlling the
activities of the entity, directly or indirectly, including all Directors.
The remuneration report is set out under the following main headings:
●
●
●
●
●
●
Principles used to determine the nature and amount of remuneration
Details of remuneration
Service agreements
Share-based compensation
Additional information
Additional disclosures relating to key management personnel
Principles used to determine the nature and amount of remuneration
This report outlines the remuneration arrangements in place for the key management personnel of Canyon for the financial
year ended 30 June 2023. The information provided in this remuneration report has been audited as required by Section 308
(3C) of the Corporations Act 2001.
The remuneration report details the remuneration arrangements for key management personnel (“KMP”) who are defined
as those persons having authority and responsibility for planning, directing and controlling the major activities of the Company
and the Group, directly or indirectly, including any director (whether executive or otherwise) of the Company, and includes
the executives in the Group.
In accordance with best practice corporate governance, the structure of non-executive Director and executive Director
remuneration is separate.
14
Canyon Resources Limited
Directors' report
30 June 2023
Remuneration Philosophy
The performance of the Company depends upon the quality of the directors and executives. The philosophy of the Company
in determining remuneration levels is to:
- set competitive remuneration packages to attract and retain high calibre employees;
- link executive rewards on sustained growth and key non-financial drivers of value.
Remuneration and nomination committee
Due to the size of the Company the entire Board are members of the Remuneration and Nomination Committee. The
Committee assesses the appropriateness of the nature and amount of remuneration of directors and executives on a periodic
basis by reference to relevant employment market conditions with an overall objective of ensuring maximum stakeholder
benefit from the retention of a high-quality Board and executive team.
Non-executive Director's remuneration
The Board seeks to set aggregate remuneration at a level that provides the Company with the ability to attract and retain
directors of the highest calibre, whilst incurring a cost that is acceptable to shareholders.
The ASX Listing Rules specify that the aggregate remuneration of non-executive directors shall be determined from time to
time by a general meeting. The maximum aggregate payable to non-executive directors approved by shareholders is $300,000
per annum.
Executive remuneration
The Group aims to reward executives based on their position and responsibility, with a level and mix of remuneration which
has both fixed and variable components.
The executive remuneration and reward framework has four components:
●
●
●
●
base pay and non-monetary benefits
short-term performance incentives
share-based payments
other remuneration such as superannuation and long service leave
The combination of these comprises the executive's total remuneration.
Fixed Remuneration
Fixed remuneration is reviewed annually by the Board. The process consists of a review of relevant comparative remuneration
in the market and internally and, where appropriate, obtaining external advice on policies and practices. The Board has access
to external, independent advice where necessary.
Directors and executives are given the opportunity to receive their fixed (primary) remuneration in a variety of forms including
cash and fringe benefits such as motor vehicles and expense payment plans. It is intended that the manner of payment chosen
will be optimal for the recipient without creating undue cost for the Company.
Variable Remuneration
The objective of the short term incentive program is to link the achievement of the Company's operational targets with the
remuneration received by the executives charged with meeting those targets. The total potential short-term incentive
available is to be set at a level so as to provide sufficient incentive to the executive to achieve the operational targets and
such that the cost to the Company is reasonable in the circumstances.
Actual payments which may be granted to each executive depend on the extent to which specific operating targets set at the
beginning of the financial year are met. For the year to 30 June 2023, and to the date of this report, the Company made $Nil
payments to key management personnel (2022: $Nil).
The Company may also make long term incentive payments to reward senior executives in a manner that aligns this element
of remuneration with the creation of shareholder wealth.
15
Canyon Resources Limited
Directors' report
30 June 2023
Employee Share Plan
On 21 November 2022 Shareholders approved a new employee incentive scheme titled the Canyon Long Term Incentive Plan.
As a result of this Shareholder approval the Company will be able to issue up to 40,000,000 securities (being options,
performance rights or performance shares) under the Plan to eligible participants over a period of 3 years without impacting
on the Company’s ability to issue up to 15% of its total ordinary securities without Shareholder approval in any 12-month
period.
The objective of the Plan is to attract, motivate and retain key employees and it is considered by the Company that the
adoption of the Plan and the future issue of Plan Securities under the Plan will provide selected employees with the
opportunity to participate in the future growth of the Company.
Any future issues of Plan Securities to a related party or a person whose relationship with the company or the related party
is, in ASX’s opinion, such that approval should be obtained will require additional Shareholder approval under ASX Listing Rule
10.14 at the relevant time.
Voting and comments made at the Company's Annual General Meeting ('AGM')
At the 29 November 2022 AGM, 92.85% of the votes received supported the adoption of the remuneration report for the
year ended 30 June 2022. The Company did not receive any specific feedback at the AGM regarding its remuneration
practices.
Details of remuneration
Amounts of remuneration
Details of the remuneration of key management personnel of the Group are set out in the following tables.
The key management personnel of the Group for the year ended 30 June 2023 consisted of the following Directors of Canyon
Resources Limited:
●
●
●
●
●
●
●
Mark Hohnen - Non Executive Chairman (appointed 8 August 2022)
Cliff Lawrenson - Non Executive Chairman (resigned 8 August 2022)
Phillip Gallagher - Managing Director (resigned 11 July 2022)
David Netherway - Non-Executive Director
Peter Su - Non-Executive Director
Scott Phegan - Non-Executive Director (appointed 8 August 2022)
Steven Zaninovich - Non-Executive Director (resigned 8 August 2022)
And the following persons:
●
●
Jean-Sebastien Boutet (Chief Executive Officer)
Rick Smith (Chief Development Officer) - resigned 31 December 2022
16
Canyon Resources Limited
Directors' report
30 June 2023
Short-term benefits
Post-
employment
benefits
Long-term
benefits
Share-based
payments
Cash salary
and fees
$
Cash
bonus
$
Other
services
$
Super-
annuation
$
Long service
leave
$
Equity-
settled
$
Total
$
71,598
15,323
53,333
51,163
40,933
7,477
329,504
400,000
169,176
1,138,507
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
4,298
-
-
-
-
4,298
-
-
-
-
-
-
-
-
-
-
53,024
-
-
-
-
-
124,622
15,323
53,333
51,163
45,231
7,477
-
329,504
341,374
-
741,374
169,176
394,398 1,537,203
30 June 2023
Non-Executive Directors:
Mark Hohnen
Cliff Lawrenson
David Netherway
Peter Su
Scott Phegan
Steven Zaninovich
Executive Directors:
Phillip Gallagher *
Other Key Management
Personnel:
Jean-Sebastien Boutet
Rick Smith
*
Includes reversal of annual leave accrual ($44,503) and long service leave ($60,000)
Short-term benefits
Post-
employment
benefits
Long-term
benefits
Share-based
payments
Cash salary
and fees
$
Cash
bonus
$
Other
Super-
services * annuation
$
$
Long service
leave
$
Equity-
settled
$
Total
$
150,000
90,000
79,992
143,082
323,279
200,000
44,086
325,486
1,355,925
-
-
-
-
-
-
-
-
-
-
-
6,200
-
-
-
-
-
-
-
-
-
-
-
-
-
150,000
90,000
86,192
143,082
-
23,412
3,845
-
350,536
-
-
-
6,200
-
6,924
-
30,336
-
-
-
3,845
272,627
41,981
-
472,627
92,991
325,486
314,608 1,710,914
30 June 2022
Non-Executive Directors:
Cliff Lawrenson
David Netherway
Steven Zaninovich
Peter Su
Executive Directors:
Phillip Gallagher **
Other Key Management
Personnel:
Jean-Sebastien Boutet
James Durrant ***
Rick Smith
Refer to note 19
*
** Includes annual leave accrual $23,279.
*** Resigned 10 September 2021, cash salary and fees includes annual leave accrual reversal ($26,347)
17
Canyon Resources Limited
Directors' report
30 June 2023
The proportion of remuneration linked to performance and the fixed proportion are as follows:
Name
Non-Executive Directors:
Mark Hohnen
Cliff Lawrenson
David Netherway
Peter Su
Scott Phegan
Steven Zaninovich
Executive Directors:
Phillip Gallagher
Other Key Management Personnel:
Jean-Sebastien Boutet
James Durrant
Rick Smith
Fixed remuneration
Performance related
30 June 2023 30 June 2022 30 June 2023 30 June 2022
57%
100%
100%
100%
100%
100%
-
100%
100%
100%
-
100%
43%
-
-
-
-
-
100%
100%
-
-
-
-
-
-
-
-
54%
-
100%
42%
55%
100%
46%
-
-
58%
45%
-
Other transactions with key management personnel
The following other transactions occurred with key management personnel:
Payment for other expenses:
Rent expense paid to Collab Capital Pty Ltd*
30 June 2023 30 June 2022
$
$
-
12,000
The following balances are outstanding at the reporting date in relation to transactions with related parties:
Current payables:
Trade payables to Collab Capital Pty Ltd*
30 June 2023 30 June 2022
$
$
-
3,300
* Collab Capital Pty Ltd provided office premises to the Company during the year. Peter Su is a Director and Shareholder of
Collab Capital Pty Ltd.
Service agreements
Remuneration and other terms of employment for key management personnel are formalised in service agreements. Details
of these agreements are as follows:
Name:
Title:
Details:
Mr Phillip Gallagher
Former Managing Director
Remuneration of $300,000 per annum plus superannuation.
The agreement may be terminated by the Company giving 6 months’ notice. Mr
Gallagher can terminate the agreement by giving 3 months’ written notice.
18
Canyon Resources Limited
Directors' report
30 June 2023
Name:
Title:
Agreement commenced:
Details:
Mr Jean-Sebastien Boutet
Chief Executive Officer
1 January 2022
Remuneration of $400,000 per annum inclusive of any other benefits.
The agreement may be terminated by either the Company or Mr Boutet upon the giving
of 6 months’ notice.
Share-based compensation
Issue of shares
There were no shares issued to Directors and other key management personnel as part of compensation during the year
ended 30 June 2023.
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:
Name
Mark Hohnen
Number of
options
granted
Issue date
Expiry date
Fair value
per option
Exercise price at grant date
1,000,000 2 December 2022
1,000,000 2 December 2022
1,000,000 2 December 2022
2 December 2025
2 December 2025
2 December 2025
$0.090
$0.120
$0.170
$0.020
$0.018
$0.015
Options granted carry no dividend or voting rights.
The number of options over ordinary shares granted to and vested by Directors and other key management personnel as part
of compensation during the year ended 30 June 2023 are set out below:
Name
Mark Hohnen
Number of Number of Number of Number of
options
granted
during the
options
granted
during the
options
vested
options
vested
during the
during the
year
year
year
year
30 June 2023 30 June 2022 30 June 2023 30 June 2022
3,000,000
-
3,000,000
-
Performance rights
The terms and conditions of each grant of performance 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
Jean-Sebastien Boutet
Grant date
18 July 2022
18 July 2022
18 July 2022
18 July 2022
18 July 2022
18 July 2022
18 July 2022
18 July 2022
18 July 2022
18 July 2022
Vesting condition *
Number
Fair value
per right
at grant date
1
2
3
4
5
6
7
8
9
10
19
1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
$0.084
$0.075
$0.071
$0.070
$0.090
$0.090
$0.090
$0.090
$0.090
$0.090
Canyon Resources Limited
Directors' report
30 June 2023
* Performance Rights are subject to the following Vesting Conditions:
(1) Achievement of a 10-day Volume Weighted Average Price ('VWAP') of $0.10
(2) Achievement of a 10-day VWAP of $0.15
(3) Achievement of a 10-day VWAP of $0.20
(4) Achievement of a 10-day VWAP of $0.25
(5) 12 months continuous employment
(6) 24 months continuous employment
(7) 36 months continuous employment
(8) Fully approved mining licence
(9) Complete rail access agreement
(10) Executed binding off take agreement for minimum 2MT for a 12 month period
Performance rights granted carry no dividend or voting rights.
The number of performance rights over ordinary shares granted to and vested by Directors and other key management
personnel as part of compensation during the year ended 30 June 2023 are set out below:
Name
Jean-Sebastien Boutete
James Durrant
Number of Number of Number of Number of
rights
granted
during the
rights
granted
during the
rights
vested
rights
vested
during the
during the
year
year
year
year
30 June 2023 30 June 2022 30 June 2023 30 June 2022
10,000,000
-
-
-
1,000,000
-
-
666,667
For performance rights granted during the year ended 30 June 2023, refer to note 28 to the financial report for details of the
methodology used to value those rights.
Additional disclosures relating to key management personnel
Shareholding
The number of shares in the Company held during the financial year by each Director and other members of key management
personnel of the Group, including their personally related parties, is set out below:
Ordinary shares
Mark Hohnen1
Cliff Lawrenson2
David Netherway
Peter Su
Scott Phegan1
Jean-Sebastien Boutet
Phillip Gallagher3
Steven Zaninovich2
Rick Smith4
Balance at Performance
the start of
the year
rights
converted
Additions
Other5
Balance at
the end of
the year
-
-
14,413,015
63,101,506
-
2,444,444
14,640,016
1,800,000
-
96,398,981
-
-
-
-
-
1,000,000
-
-
-
1,000,000
450,000
-
555,555
4,444,444
-
-
-
-
-
5,449,999
-
-
-
-
-
-
(14,640,016)
(1,800,000)
-
(16,440,016)
450,000
-
14,968,570
67,545,950
-
3,444,444
-
-
-
86,408,964
(1) appointed 8 August 2022
(2) resigned 8 August 2022
(3) resigned 11 July 2022
(4) resigned 31 December 2022
(5) balance on appointment or resignation
20
Canyon Resources Limited
Directors' report
30 June 2023
Option holding
The number of options over ordinary shares in the Company held during the financial year by each Director and other
members of key management personnel of the Group, including their personally related parties, is set out below:
Options over ordinary shares
Mark Hohnen1
Cliff Lawrenson2
David Netherway
Peter Su
Scott Phegan1
Jean-Sebastien Boutet
Phillip Gallagher3
Steven Zaninovich2
Rick Smith4
Balance at
the start of
the year
Granted
Exercised
Other5
Balance at
the end of
the year
-
-
-
-
-
-
-
-
-
-
3,000,000
-
-
-
-
-
-
-
-
3,000,000
-
-
-
-
-
-
-
-
-
-
-
-
555,555
4,444,444
-
2,444,444
-
-
-
7,444,443
3,000,000
-
555,555
4,444,444
-
2,444,444
-
-
-
10,444,443
(1) appointed 8 August 2022
(2) resigned 8 August 2022
(3) resigned 11 July 2022
(4) resigned 31 December 2022
(5) free attaching options issued as part of capital raising during the year.
Performance rights holding
The number of performance rights over ordinary shares in the Company held during the financial year by each Director and
other members of key management personnel of the Group, including their personally related parties, is set out below:
Balance at
the start of
the year
Granted
Converted
Expired/
forfeited/
other
Balance at
the end of
the year
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
10,000,000
-
-
-
-
10,000,000
-
-
-
-
-
(1,000,000)
-
-
-
-
(1,000,000)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
9,000,000
-
-
-
-
9,000,000
Performance rights over ordinary shares
Mark Hohnen1
Cliff Lawrenson2
David Netherway
Peter Su
Scott Phegan1
Jean-Sebastien Boutet
Phillip Gallagher3
Steven Zaninovich2
Rick Smith4
Jean-Sebastien Boutet
(1) appointed 8 August 2022
(2) resigned 8 August 2022
(3) resigned 11 July 2022
(4) resigned 31 December 2022
Additional information
It is not possible at this time to evaluate the Company's financial performance using generally accepted measures such as
profitability and total shareholder return as the Company is an exploration company with no signification revenue stream.
This assessment will be developed if and when the Company moves from explorer to producer.
21
Canyon Resources Limited
Directors' report
30 June 2023
The earnings of the Group for the five years to 30 June 2023 are summarised below:
2023
$
2022
$
2021
$
2020
$
2019
$
Loss after income tax
(4,986,711)
(12,775,411)
(4,751,302)
(8,520,515)
(8,261,236)
The factors that are considered to affect total shareholders return ('TSR') are summarised below:
2023
2022
2021
2020
2019
Share price at financial year end ($)
Basic earnings per share (cents per share)
0.07
(0.54)
0.04
(1.84)
0.12
(0.80)
0.17
(1.83)
0.21
(2.16)
This concludes the remuneration report, which has been audited.
Shares under option
Unissued ordinary shares of Canyon Resources Limited under option at the date of this report are as follows:
Expiry date
10 August 2024
10 August 2025
2 December 2025
2 December 2025
2 December 2025
Exercise
price
Number
under option
$0.070 110,080,798
$0.070 202,900,000
$0.170
1,000,000
$0.090
1,000,000
$0.120
1,000,000
315,980,798
No person entitled to exercise the options had or has any right by virtue of the option to participate in any share issue of the
Company or of any other body corporate.
Shares under performance rights
Unissued ordinary shares of Canyon Resources Limited under performance rights at the date of this report are as follows:
Grant Date
18 July 2022
Number
10,000,000
Shares issued on the exercise of options
There were no ordinary shares of Canyon Resources Limited issued on the exercise of options during the year ended 30 June
2023 and up to the date of this report.
Shares issued on the exercise of performance rights
The following ordinary shares of Canyon Resources Limited were issued during the year ended 30 June 2023 and up to the
date of this report on the exercise of performance rights granted:
Date performance rights converted
15 March 2023
Valuation
per share
Number of
shares issued
$0.090
1,000,000
Indemnity and insurance of officers
The Company has indemnified the Directors and executives of the Company for costs incurred, in their capacity as a Director
or executive, for which they may be held personally liable, except where there is a lack of good faith.
22
Canyon Resources Limited
Directors' report
30 June 2023
During the financial year, the Company paid a premium in respect of a contract to insure the Directors and executives of the
Company against a liability to the extent permitted by the Corporations Act 2001. The contract of insurance prohibits
disclosure of the nature of the liability and the amount of the premium.
Indemnity and insurance of auditor
The Company has not, during or since the end of the financial year, indemnified or agreed to indemnify the auditor of the
Company or any related entity against a liability incurred by the auditor.
During the financial year, the Company has not paid a premium in respect of a contract to insure the auditor of the Company
or any related entity.
Proceedings on behalf of the Company
No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings on behalf
of the Company, or to intervene in any proceedings to which the Company is a party for the purpose of taking responsibility
on behalf of the Company for all or part of those proceedings.
Non-audit services
There were no non-audit services provided during the financial year by the auditor.
Auditor's independence declaration
A copy of the auditor's independence declaration as required under section 307C of the Corporations Act 2001 is set out
immediately after this Directors' report.
Auditor
HLB Mann Judd (WA Partnership) continues in office in accordance with section 327 of the Corporations Act 2001.
This report is made in accordance with a resolution of Directors, pursuant to section 298(2)(a) of the Corporations Act 2001.
On behalf of the Directors
___________________________
Mark Hohnen
Non-Executive Chairman
28 September 2023
23
AUDITOR’S INDEPENDENCE DECLARATION
As lead auditor for the audit of the consolidated financial report of Canyon Resources Limited for
the year ended 30 June 2023, I declare that to the best of my knowledge and belief, there have
been no contraventions of:
a)
the auditor independence requirements of the Corporations Act 2001 in relation to the audit;
and
b)
any applicable code of professional conduct in relation to the audit.
Perth, Western Australia
28 September 2023
L Di Giallonardo
Partner
24
Canyon Resources Limited
Consolidated statement of profit or loss and other comprehensive income
For the year ended 30 June 2023
Other income
Interest received
Expenses:
Foreign exchange loss
Employee benefits expense
Consultants and contractors
Depreciation and amortisation expense
Impairment of exploration
Loss on disposal of plant and equipment
Travel expenses
Compliance and regulatory
Legal and professional fees
Share based payments
Exploration expenditure expensed
Interest expense
Occupancy
Administration
Loss before income tax expense
Income tax expense
Loss after income tax expense for the year
Other comprehensive income/(loss)
Items that may be reclassified subsequently to profit or loss
Foreign currency translation
Other comprehensive income/(loss) for the year, net of tax
Total comprehensive loss for the year
Basic loss per share
Diluted loss per share
Note 30 June 2023 30 June 2022
$
$
5
22,614
170,263
-
3,535
-
(2,302,584)
(317,248)
(59,447)
(550,000)
(1,017)
(188,818)
(94,757)
(143,580)
(394,398)
(794,883)
(3,146)
(70,022)
(259,688)
(57,200)
(2,026,461)
(466,354)
(84,789)
-
(10,779)
(310,343)
(103,806)
(258,367)
(4,695,858)
(4,461,512)
(787)
(115,135)
(187,555)
(4,986,711)
(12,775,411)
-
-
(4,986,711)
(12,775,411)
11
28
11
6
16
847,186
(792,490)
847,186
(792,490)
(4,139,525)
(13,567,901)
Cents
Cents
29
29
(0.54)
(0.54)
(1.84)
(1.84)
The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the
accompanying notes
25
Canyon Resources Limited
Consolidated statement of financial position
As at 30 June 2023
Assets
Current assets
Cash and cash equivalents
Trade and other receivables
Other assets
Total current assets
Non-current assets
Plant and equipment
Capitalised exploration expenditure
Total non-current assets
Total assets
Liabilities
Current liabilities
Trade and other payables
Provisions
Total current liabilities
Total liabilities
Net assets
Equity
Issued capital
Reserves
Accumulated losses
Total equity
Note 30 June 2023 30 June 2022
$
$
7
8
9
10
11
12
13
10,726,199
182,648
401,642
11,310,489
4,478,367
51,251
393,097
4,922,715
197,061
18,073,713
18,270,774
239,179
16,424,121
16,663,300
29,581,263
21,586,015
708,980
32,915
741,895
1,061,289
121,427
1,182,716
741,895
1,182,716
28,839,368
20,403,299
14
15
16
89,004,240
6,841,087
(67,005,959)
76,733,044
5,689,503
(62,019,248)
28,839,368
20,403,299
The above consolidated statement of financial position should be read in conjunction with the accompanying notes
26
Canyon Resources Limited
Consolidated statement of changes in equity
For the year ended 30 June 2023
Issued
capital
$
Foreign
currency
reserve
$
Share based
payments
reserve
$
Accumulated
losses
$
Total equity
$
Balance at 1 July 2021
66,543,010
5,524
1,881,428
(49,288,404)
19,141,558
Loss after income tax expense for the year
Other comprehensive loss for the year, net of
tax
Total comprehensive loss for the year
-
-
-
-
-
(12,775,411)
(12,775,411)
(792,490)
-
-
(792,490)
(792,490)
-
(12,775,411)
(13,567,901)
Transactions with owners in their capacity as
owners:
Share issued for cash
Share issue costs
Value of performance rights expensed
Transfer balance of reserve
Shares issued in lieu of payment
Fair value of shares to be issued for exploration
and evaluation acquisition
10,889,209
(755,425)
-
-
56,250
-
-
-
-
-
-
-
-
-
314,608
(44,567)
-
-
-
-
44,567
-
10,889,209
(755,425)
314,608
-
56,250
4,325,000
-
4,325,000
Balance at 30 June 2022
76,733,044
(786,966)
6,476,469
(62,019,248)
20,403,299
Issued
capital
$
Foreign
currency
reserve
$
Share based
payments
reserve
$
Accumulated
losses
$
Total equity
$
Balance at 1 July 2022
76,733,044
(786,966)
6,476,469
(62,019,248)
20,403,299
Loss after income tax expense for the year
Other comprehensive income for the year, net
of tax
Total comprehensive income/(loss) for the year
-
-
-
-
-
(4,986,711)
(4,986,711)
847,186
-
-
847,186
847,186
-
(4,986,711)
(4,139,525)
Transactions with owners in their capacity as
owners:
Share issued for cash
Share issue costs
Options issued
Value of performance rights expensed
Performance rights converted
12,419,000
(237,804)
-
-
90,000
-
-
-
-
-
-
-
53,024
341,374
(90,000)
-
-
-
-
-
12,419,000
(237,804)
53,024
341,374
-
Balance at 30 June 2023
89,004,240
60,220
6,780,867
(67,005,959)
28,839,368
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes
27
Canyon Resources Limited
Consolidated statement of cash flows
For the year ended 30 June 2023
Cash flows from operating activities
Payments to suppliers and employees
Payments for exploration and evaluation expenditure
Interest received
Interest and other finance costs paid
Note 30 June 2023 30 June 2022
$
$
(3,730,633)
(952,577)
134,170
(3,146)
(3,211,469)
(4,767,562)
3,535
-
Net cash used in operating activities
26
(4,552,186)
(7,975,496)
Cash flows from investing activities
Payments for plant and equipment
Payments for exploration and evaluation
Proceeds from disposal of investments
Proceeds from disposal of property, plant and equipment
Net cash used in investing activities
Cash flows from financing activities
Proceeds from issue of shares
Share issue transaction costs
Net cash from financing activities
Net increase in cash and cash equivalents
Cash and cash equivalents at the beginning of the financial year
Effects of exchange rate changes on cash and cash equivalents
10
11
(40,502)
(1,339,481)
-
-
(8,047)
(260,408)
138,528
3,175
(1,379,983)
(126,752)
14
12,419,000
(237,804)
10,889,209
(755,425)
12,181,196
10,133,784
6,249,027
4,478,367
(1,195)
2,031,536
2,684,012
(237,181)
Cash and cash equivalents at the end of the financial year
7
10,726,199
4,478,367
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes
28
Canyon Resources Limited
Notes to the consolidated financial statements
30 June 2023
Note 1. General information
The financial statements cover Canyon Resources Limited as a Group consisting of Canyon Resources Limited and the entities
it controlled at the end of, or during, the year. The financial statements are presented in Australian dollars, which is Canyon
Resources Limited's functional and presentation currency.
Canyon Resources Limited is a listed public company limited by shares, incorporated and domiciled in Australia. Its registered
office and principal place of business is:
945 Wellington Street
West Perth, Western Australia, 6005
T: +61 8 9322 7600
A description of the nature of the Group's operations and its principal activities are included in the Directors' report, which is
not part of the financial statements.
The financial statements were authorised for issue, in accordance with a resolution of Directors, on 28 September 2023. The
Directors have the power to amend and reissue the financial statements.
Note 2. Significant accounting policies
The principal accounting policies adopted in the preparation of the financial statements are set out below. These policies
have been consistently applied to all the years presented, unless otherwise stated.
New or amended Accounting Standards and Interpretations adopted
The Group has adopted all of the new or amended Accounting Standards and Interpretations issued by the Australian
Accounting Standards Board ('AASB') that are mandatory for the current reporting period.
In the Directors' opinion, none of the new or amended Accounting Standards and Interpretations have had, or will have a
material effect on the Group's financial performance or position.
Going concern
This report has been prepared on the going concern basis, which contemplates the continuity of normal business activity and
realisation of assets and the settlement of liabilities in the normal course of business.
Basis of preparation
These general purpose financial statements have been prepared in accordance with Australian Accounting Standards and
Interpretations issued by the Australian Accounting Standards Board ('AASB') and the Corporations Act 2001, as appropriate
for for-profit oriented entities. These financial statements also comply with International Financial Reporting Standards as
issued by the International Accounting Standards Board ('IASB').
Historical cost convention
The financial statements have been prepared under the historical cost convention.
Critical accounting estimates
The preparation of the financial statements requires the use of certain critical accounting estimates. It also requires
management to exercise its judgement in the process of applying the Group's accounting policies. The areas involving a higher
degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements,
are disclosed in note 3.
Parent entity information
In accordance with the Corporations Act 2001, these financial statements present the results of the Group only.
Supplementary information about the parent entity is disclosed in note 23.
29
Canyon Resources Limited
Notes to the consolidated financial statements
30 June 2023
Note 2. Significant accounting policies (continued)
Principles of consolidation
The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Canyon Resources Limited
('Company' or 'parent entity') as at 30 June 2023 and the results of all subsidiaries for the year then ended. Canyon Resources
Limited and its subsidiaries together are referred to in these financial statements as 'the Group'.
Subsidiaries are all those entities over which the Group has control. The Group controls an entity when the Group is exposed
to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through
its power to direct the activities of the entity. Subsidiaries are fully consolidated from the date on which control is transferred
to the Group. They are de-consolidated from the date that control ceases.
Intercompany transactions, balances and unrealised gains on transactions between entities in the Group are eliminated.
Unrealised losses are also eliminated unless the transaction provides evidence of the impairment of the asset transferred.
Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by
the Group.
The acquisition of subsidiaries is accounted for using the acquisition method of accounting. A change in ownership interest,
without the loss of control, is accounted for as an equity transaction, where the difference between the consideration
transferred and the book value of the share of the non-controlling interest acquired is recognised directly in equity
attributable to the parent.
Where the Group loses control over a subsidiary, it derecognises the assets including goodwill, liabilities and non-controlling
interest in the subsidiary together with any cumulative translation differences recognised in equity. The Group recognises the
fair value of the consideration received and the fair value of any investment retained together with any gain or loss in profit
or loss.
Operating segments
Operating segments are presented using the 'management approach', where the information presented is on the same basis
as the internal reports provided to the Chief Operating Decision Makers ('CODM'). The CODM is responsible for the allocation
of resources to operating segments and assessing their performance.
Foreign currency translation
The financial statements are presented in Australian dollars, which is Canyon Resources Limited's functional and presentation
currency.
Foreign currency transactions
Foreign currency transactions are translated into Australian dollars using the exchange rates prevailing at the dates of the
transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation
at financial year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in
profit or loss.
Foreign operations
The assets and liabilities of foreign operations are translated into Australian dollars using the exchange rates at the reporting
date. The revenues and expenses of foreign operations are translated into Australian dollars using the average exchange
rates, which approximate the rates at the dates of the transactions, for the period. All resulting foreign exchange differences
are recognised in other comprehensive income through the foreign currency reserve in equity.
The foreign currency reserve is recognised in profit or loss when the foreign operation or net investment is disposed of.
30
Canyon Resources Limited
Notes to the consolidated financial statements
30 June 2023
Note 2. Significant accounting policies (continued)
Revenue recognition
The Group recognises revenue as follows:
Interest
Interest revenue is recognised as interest accrues using the effective interest method. This is a method of calculating the
amortised cost of a financial asset and allocating the interest income over the relevant period using the effective interest
rate, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to
the net carrying amount of the financial asset.
Other revenue
Other revenue is recognised when it is received or when the right to receive payment is established.
Income tax
The income tax expense or benefit for the period is the tax payable on that period's taxable income based on the applicable
income tax rate for each jurisdiction, adjusted by the changes in deferred tax assets and liabilities attributable to temporary
differences, unused tax losses and the adjustment recognised for prior periods, where applicable.
Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected to be applied when the
assets are recovered or liabilities are settled, based on those tax rates that are enacted or substantively enacted, except for:
When the deferred income tax asset or liability arises from the initial recognition of goodwill or an asset or liability in a
●
transaction that is not a business combination and that, at the time of the transaction, affects neither the accounting
nor taxable profits; or
When the taxable temporary difference is associated with interests in subsidiaries, associates or joint ventures, and the
timing of the reversal can be controlled and it is probable that the temporary difference will not reverse in the
foreseeable future.
●
Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that future
taxable amounts will be available to utilise those temporary differences and losses.
The carrying amount of recognised and unrecognised deferred tax assets are reviewed at each reporting date. Deferred tax
assets recognised are reduced to the extent that it is no longer probable that future taxable profits will be available for the
carrying amount to be recovered. Previously unrecognised deferred tax assets are recognised to the extent that it is probable
that there are future taxable profits available to recover the asset.
Deferred tax assets and liabilities are offset only where there is a legally enforceable right to offset current tax assets against
current tax liabilities and deferred tax assets against deferred tax liabilities; and they relate to the same taxable authority on
either the same taxable entity or different taxable entities which intend to settle simultaneously.
Current and non-current classification
Assets and liabilities are presented in the statement of financial position based on current and non-current classification.
An asset is classified as current when: it is either expected to be realised or intended to be sold or consumed in the Group's
normal operating cycle; it is held primarily for the purpose of trading; it is expected to be realised within 12 months after the
reporting period; or the asset is cash or cash equivalent unless restricted from being exchanged or used to settle a liability for
at least 12 months after the reporting period. All other assets are classified as non-current.
A liability is classified as current when: it is either expected to be settled in the Group's normal operating cycle; it is held
primarily for the purpose of trading; it is due to be settled within 12 months after the reporting period; or there is no
unconditional right to defer the settlement of the liability for at least 12 months after the reporting period. All other liabilities
are classified as non-current.
Deferred tax assets and liabilities are always classified as non-current.
31
Canyon Resources Limited
Notes to the consolidated financial statements
30 June 2023
Note 2. Significant accounting policies (continued)
Cash and cash equivalents
Cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other short-term, highly
liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and
which are subject to an insignificant risk of changes in value.
Trade and other receivables
Other receivables are recognised at amortised cost, less any allowance for expected credit losses.
Property, plant and equipment
Plant and equipment is stated at historical cost less accumulated depreciation and impairment. Historical cost includes
expenditure that is directly attributable to the acquisition of the items.
Depreciation is calculated on a straight-line basis to write off the net cost of each item of property, plant and equipment
(excluding land) over their expected useful lives as follows:
Plant and equipment
3-7 years
The residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each reporting date.
Leasehold improvements are depreciated over the unexpired period of the lease or the estimated useful life of the assets,
whichever is shorter.
An item of property, plant and equipment is derecognised upon disposal or when there is no future economic benefit to the
Group. Gains and losses between the carrying amount and the disposal proceeds are taken to profit or loss.
Capitalised exploration expenditure
Exploration and evaluation costs are either expensed as incurred or capitalised where the capitalised expense meets the
requirements for capitalisation. Exploration and evaluation costs are carried forward only if the rights to tenure of the area
of interest are current and either:
●
●
The costs are expected to be recouped through successful development and exploitation of the area of interest or;
The activities in the area of interest at the reporting date have not 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.
Accumulated acquisition costs in relation to an abandoned area are written off in full to the statement of profit or loss and
other comprehensive income in the year in which the decision to abandon the area is made.
The carrying values of acquisition costs are reviewed for impairment when events or changes in circumstances indicate the
carrying value may not be recoverable. Where a decision has been made to proceed with development in respect of an area
of interest the relevant exploration and evaluation asset is tested for impairment and the balance is then reclassified to
development.
The Group has elected to capitalise all acquisition costs for its areas of interest and to expense all ongoing exploration and
evaluation expenditure with the exception of the Minim Martap project where all expenditure that meets the recognition
criteria is being capitalised.
Impairment of non-financial assets
Non-financial assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying
amount may not be recoverable. An impairment loss is recognised for the amount by which the asset's carrying amount
exceeds its recoverable amount.
32
Canyon Resources Limited
Notes to the consolidated financial statements
30 June 2023
Note 2. Significant accounting policies (continued)
Recoverable amount is the higher of an asset's fair value less costs of disposal and value-in-use. The value-in-use is the present
value of the estimated future cash flows relating to the asset using a pre-tax discount rate specific to the asset or cash-
generating unit to which the asset belongs. Assets that do not have independent cash flows are grouped together to form a
cash-generating unit.
Trade and other payables
These amounts represent liabilities for goods and services provided to the Group prior to the end of the financial year and
which are unpaid. Due to their short-term nature they are measured at amortised cost and are not discounted. The amounts
are unsecured and are usually paid within 30 days of recognition.
Employee benefits
Short-term employee benefits
Liabilities for wages and salaries, including non-monetary benefits, annual leave and long service leave expected to be settled
wholly within 12 months of the reporting date are measured at the amounts expected to be paid when the liabilities are
settled.
Other long-term employee benefits
The liability for annual leave and long service leave not expected to be settled within 12 months of the reporting date are
measured at the present value of expected future payments to be made in respect of services provided by employees up to
the reporting date using the projected unit credit method. Consideration is given to expected future wage and salary levels,
experience of employee departures and periods of service. Expected future payments are discounted using market yields at
the reporting date on high quality corporate bonds with terms to maturity and currency that match, as closely as possible,
the estimated future cash outflows.
Share-based payments
Equity-settled and cash-settled share-based compensation benefits are provided to employees.
Equity-settled transactions are awards of shares, or options over shares, that are provided to employees in exchange for the
rendering of services. Cash-settled transactions are awards of cash for the exchange of services, where the amount of cash is
determined by reference to the share price.
The cost of equity-settled transactions are measured at fair value on grant date. Fair value is independently determined using
either the Binomial or Black-Scholes option pricing model that takes into account the exercise price, the term of the option,
the impact of dilution, the share price at grant date and expected price volatility of the underlying share, the expected
dividend yield and the risk free interest rate for the term of the option, together with non-vesting conditions that do not
determine whether the Group receives the services that entitle the employees to receive payment. No account is taken of
any other vesting conditions.
The cost of equity-settled transactions are recognised as an expense with a corresponding increase in equity over the vesting
period. The cumulative charge to profit or loss is calculated based on the grant date fair value of the award, the best estimate
of the number of awards that are likely to vest and the expired portion of the vesting period. The amount recognised in profit
or loss for the period is the cumulative amount calculated at each reporting date less amounts already recognised in previous
periods.
The cost of cash-settled transactions is initially, and at each reporting date until vested, determined by applying either the
Binomial or Black-Scholes option pricing model, taking into consideration the terms and conditions on which the award was
granted. The cumulative charge to profit or loss until settlement of the liability is calculated as follows:
●
during the vesting period, the liability at each reporting date is the fair value of the award at that date multiplied by the
expired portion of the vesting period.
from the end of the vesting period until settlement of the award, the liability is the full fair value of the liability at the
reporting date.
●
All changes in the liability are recognised in profit or loss. The ultimate cost of cash-settled transactions is the cash paid to
settle the liability.
33
Canyon Resources Limited
Notes to the consolidated financial statements
30 June 2023
Note 2. Significant accounting policies (continued)
Market conditions are taken into consideration in determining fair value. Therefore any awards subject to market conditions
are considered to vest irrespective of whether or not that market condition has been met, provided all other conditions are
satisfied.
If equity-settled awards are modified, as a minimum an expense is recognised as if the modification has not been made. An
additional expense is recognised, over the remaining vesting period, for any modification that increases the total fair value of
the share-based compensation benefit as at the date of modification.
If the non-vesting condition is within the control of the Group or employee, the failure to satisfy the condition is treated as a
cancellation. If the condition is not within the control of the Group or employee and is not satisfied during the vesting period,
any remaining expense for the award is recognised over the remaining vesting period, unless the award is forfeited.
If equity-settled awards are cancelled, it is treated as if it has vested on the date of cancellation, and any remaining expense
is recognised immediately. If a new replacement award is substituted for the cancelled award, the cancelled and new award
is treated as if they were a modification.
Fair value measurement
When an asset or liability, financial or non-financial, is measured at fair value for recognition or disclosure purposes, the fair
value is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction
between market participants at the measurement date; and assumes that the transaction will take place either: in the
principal market; or in the absence of a principal market, in the most advantageous market.
Fair value is measured using the assumptions that market participants would use when pricing the asset or liability, assuming
they act in their economic best interests. For non-financial assets, the fair value measurement is based on its highest and best
use. Valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure
fair value, are used, maximising the use of relevant observable inputs and minimising the use of unobservable inputs.
Issued capital
Ordinary shares are classified as equity.
Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax,
from the proceeds.
Business combinations are initially accounted for on a provisional basis. The acquirer retrospectively adjusts the provisional
amounts recognised and also recognises additional assets or liabilities during the measurement period, based on new
information obtained about the facts and circumstances that existed at the acquisition-date. The measurement period ends
on either the earlier of (i) 12 months from the date of the acquisition or (ii) when the acquirer receives all the information
possible to determine fair value.
Earnings per share
Basic earnings/loss per share
Basic earnings per share is calculated by dividing the profit/loss attributable to the owners of Canyon Resources Limited,
excluding any costs of servicing equity other than ordinary shares, by the weighted average number of ordinary shares
outstanding during the financial year, adjusted for bonus elements in ordinary shares issued during the financial year.
Diluted earnings/loss per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account the
after income tax effect of interest and other financing costs associated with dilutive potential ordinary shares and the
weighted average number of shares assumed to have been issued for no consideration in relation to dilutive potential
ordinary shares.
Goods and Services Tax ('GST') and other similar taxes
Revenues, expenses and assets are recognised net of the amount of associated GST, unless the GST incurred is not recoverable
from the tax authority. In this case it is recognised as part of the cost of the acquisition of the asset or as part of the expense.
34
Canyon Resources Limited
Notes to the consolidated financial statements
30 June 2023
Note 2. Significant accounting policies (continued)
Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of GST recoverable
from, or payable to, the tax authority is included in other receivables or other payables in the statement of financial position.
Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities
which are recoverable from, or payable to the tax authority, are presented as operating cash flows.
Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the tax authority.
New Accounting Standards and Interpretations not yet mandatory or early adopted
Australian Accounting Standards and Interpretations that have recently been issued or amended but are not yet mandatory,
have not been early adopted by the Group for the annual reporting period ended 30 June 2023. The Group has not yet
assessed the impact of these new or amended Accounting Standards and Interpretations.
Note 3. Critical accounting judgements, estimates and assumptions
The preparation of the financial statements requires management to make judgements, estimates and assumptions that
affect the reported amounts in the financial statements. Management continually evaluates its judgements and estimates in
relation to assets, liabilities, contingent liabilities, revenue and expenses. Management bases its judgements, estimates and
assumptions on historical experience and on other various factors, including expectations of future events, management
believes to be reasonable under the circumstances. The resulting accounting judgements and estimates will seldom equal the
related actual results. The judgements, estimates and assumptions that have a significant risk of causing a material adjustment
to the carrying amounts of assets and liabilities (refer to the respective notes) within the next financial year are discussed
below.
Share-based payment transactions
The Group measures the cost of equity-settled transactions with employees and consultants where the fair value of the
services provided cannot be estimated by reference to the fair value of the equity instruments at the date at which they are
granted. The fair value is determined using a Black and Scholes model and is based on assumptions disclosed in periods
disclosed when the equity instruments are granted.
Fair value measurement hierarchy
The Group is required to classify all assets and liabilities, measured at fair value, using a three level hierarchy, based on the
lowest level of input that is significant to the entire fair value measurement, being: Level 1: Quoted prices (unadjusted) in
active markets for identical assets or liabilities that the entity can access at the measurement date; Level 2: Inputs other than
quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly; and Level 3:
Unobservable inputs for the asset or liability. Considerable judgement is required to determine what is significant to fair value
and therefore which category the asset or liability is placed in can be subjective.
The fair value of assets and liabilities classified as level 3 is determined by the use of valuation models. These include
discounted cash flow analysis or the use of observable inputs that require significant adjustments based on unobservable
inputs.
Employee benefits provision
The liability for employee benefits expected to be settled more than 12 months from the reporting date are recognised and
measured at the present value of the estimated future cash flows to be made in respect of all employees at the reporting
date. In determining the present value of the liability, estimates of attrition rates and pay increases through promotion and
inflation have been taken into account.
Exploration and evaluation costs
The recoverability of the carrying amount of exploration and evaluation costs carried forward have been reviewed by the
directors. In conducting the review, the recoverable amount has been assessed by reference to the higher of “fair value less
costs to sell” and “value in use”. In determining value in use, future cash flows are based on various parameters.
Variations to expected future cash flows and timing thereof, could result in significant changes to the impairment test results,
which in turn could impact future financial results.
35
Canyon Resources Limited
Notes to the consolidated financial statements
30 June 2023
Note 4. Operating segments
The Group is managed primarily on the basis of its exploration projects. Operating segments are therefore determined on the
same basis. Reportable segments disclosed are based on aggregating tenements and permits where the tenements and
permits are considered to form a single project. This is indicated by:
●
●
●
●
having the same ownership structure;
exploration being focused on the same mineral or type of mineral;
exploration programs targeting the tenements and permits as a group, indicated by the use of the same exploration
team, and shared geological data, knowledge and confidence across the areas; and
shared mining economic considerations such as mineralisation, metallurgy, marketing, legal, environmental, social and
government factors.
Basis of accounting for purposes of reporting by operating segments
Accounting policies adopted
Unless stated otherwise, all amounts reported to the Board of Directors as the chief operating decision maker with respect
to operating segments are determined in accordance with accounting policies that are consistent to those adopted in the
annual financial statements of the Group.
Where an asset is used across multiple segments, the asset is allocated to the segment that receives the majority of economic
value from the asset. In the majority of instances, segment assets are clearly identifiable on the basis of their nature and
physical location.
Unless indicated otherwise in the segment assets note, investments in financial assets, deferred tax assets and intangible
assets have not been allocated to operating segments.
The following table presents the profit & loss and assets & liabilities information by segment provided to the Board of
Directors:
30 June 2023
Segment revenue
Expenses
Loss before income tax expense
Income tax expense
Loss after income tax expense
Material items include:
Depreciation
Share-based payments
Interest revenue
Assets
Segment assets
Total assets
Liabilities
Segment liabilities
Total liabilities
Exploration Unallocated
(Corporate)
$
(Africa)
$
Total
$
22,837
(2,688,879)
(2,666,042)
170,040
(2,490,709)
(2,320,669)
192,877
(5,179,588)
(4,986,711)
-
(4,986,711)
(58,933)
-
-
(514)
(394,398)
170,263
(59,447)
(394,398)
170,263
18,744,786
10,836,477
388,147
353,748
29,581,263
29,581,263
741,895
741,895
36
Canyon Resources Limited
Notes to the consolidated financial statements
30 June 2023
Note 4. Operating segments (continued)
30 June 2022
Segment revenue
Expenses
Loss before income tax expense
Income tax expense
Loss after income tax expense
Material items include:
Depreciation
Share-based payments
Interest revenue
Assets
Segment assets
Total assets
Liabilities
Segment liabilities
Total liabilities
Note 5. Other income
Net foreign exchange gain
Note 6. Income tax expense
Numerical reconciliation of income tax expense and tax at the statutory rate
Loss before income tax expense
Tax at the statutory tax rate of 30%
Tax effect amounts which are not deductible/(taxable) in calculating taxable income:
Sundry items
Movement in unrecognised temporary differences
Tax effect of current year tax losses for which no deferred tax asset has been recognised
Income tax expense
37
Exploration Unallocated
(Corporate)
$
(Africa)
$
Total
$
-
(5,475,420)
(5,475,420)
3,535
(7,303,526)
(7,299,991)
3,535
(12,778,946)
(12,775,411)
-
(12,775,411)
(82,157)
(4,325,000)
-
(2,632)
(370,858)
3,535
(84,789)
(4,695,858)
3,535
17,079,257
4,506,758
219,647
963,069
21,586,015
21,586,015
1,182,716
1,182,716
30 June 2023 30 June 2022
$
$
22,614
-
30 June 2023 30 June 2022
$
$
(4,986,711)
(12,775,411)
(1,496,013)
(3,832,623)
51
515
(1,495,962)
(120,236)
1,616,198
(3,832,108)
(80,147)
3,912,255
-
-
Canyon Resources Limited
Notes to the consolidated financial statements
30 June 2023
Note 6. Income tax expense (continued)
Deferred tax assets not recognised
Deferred tax assets not recognised comprises temporary differences attributable to:
Provisions
Accrued expenses
Capital raising costs
Carry forward tax losses
Total deferred tax assets not recognised
Unrecognised temporary differences
Deferred tax liabilities at 30%
Exploration expenditure
30 June 2023 30 June 2022
$
$
9,052
9,872
165,611
47,182,210
36,428
5,100
242,105
41,167,332
47,366,745
41,450,965
30 June 2023 30 June 2022
$
$
1,200,192
1,320,428
The potential deferred tax benefit of tax losses has not been recognised as an asset because recovery of tax losses is not
considered probable in the context of AASB 112. The benefit of these tax losses will only be realised if:
(a) The Company derives future assessable income of a nature and of an amount sufficient to enable the benefit from the
deduction for the losses to be realised.
(b) The Company complies with the conditions for deductibility imposed by the law; and
(c) No changes in tax legislation adversely affect the Company in realising the benefit from the deduction for the loss.
Ultimately, recoverability of tax losses in the future is subject to the ability of the Group to satisfy the relevant tax authority’s
criteria for using the losses, either by satisfying the Continuity of Ownership Test or the Business Continuity Test. As at the
date of this signed report, the Group’s formal assessments of recoverability are in progress.
Note 7. Current assets - cash and cash equivalents
Cash on hand
Cash at bank
Cash on deposit
Note 8. Current assets - trade and other receivables
Other receivables
Interest receivable
BAS receivable
38
30 June 2023 30 June 2022
$
$
51
1,726,148
9,000,000
36,832
4,441,535
-
10,726,199
4,478,367
30 June 2023 30 June 2022
$
$
27,578
36,093
118,977
9,542
-
41,709
182,648
51,251
Canyon Resources Limited
Notes to the consolidated financial statements
30 June 2023
Note 9. Current assets - other assets
Prepayments
Other deposits
Other current assets
30 June 2023 30 June 2022
$
$
89,422
277,749
34,471
87,226
267,139
38,732
401,642
393,097
Other deposits includes surety bonds paid to the Cameroon Ministry of Mines in relation to the 3 Minim Martap Licences.
Note 10. Non-current assets - plant and equipment
Plant and equipment - at cost
Less: Accumulated depreciation
Computer equipment - at cost
Less: Accumulated depreciation
Office equipment - at cost
Less: Accumulated depreciation
30 June 2023 30 June 2022
$
$
567,670
(382,717)
184,953
528,473
(307,917)
220,556
66,047
(54,471)
11,576
61,670
(61,138)
532
61,487
(46,000)
15,487
57,332
(54,196)
3,136
197,061
239,179
Reconciliations
Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out
below:
Balance at 1 July 2021
Additions
Disposals
Exchange differences
Depreciation expense
Balance at 30 June 2022
Additions
Disposals
Exchange differences
Depreciation expense
Balance at 30 June 2023
Office
Computer
equipment equipment equipment
$
Field
$
$
21,559
-
(3,008)
(1,722)
(13,693)
3,136
33,040
(33,040)
92
(2,696)
32,716
4,681
(6,750)
522
(15,682)
15,487
4,622
(1,017)
(2,315)
(5,201)
291,481
3,366
(4,196)
(14,681)
(55,414)
220,556
2,840
-
13,107
(51,550)
Total
$
345,756
8,047
(13,954)
(15,881)
(84,789)
239,179
40,502
(34,057)
10,884
(59,447)
532
11,576
184,953
197,061
39
Canyon Resources Limited
Notes to the consolidated financial statements
30 June 2023
Note 11. Non-current assets - capitalised exploration expenditure
Exploration and evaluation phase - Minim Martap
Exploration and evaluation phase - Birsok
30 June 2023 30 June 2022
$
$
18,073,713
15,874,121
-
550,000
18,073,713
16,424,121
Reconciliations
Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out
below:
Balance at 1 July 2021
Expenditure during the year
Exchange differences
Balance at 30 June 2022
Expenditure during the year
Exchange differences
Impairment of assets 1
Balance at 30 June 2023
$
16,760,341
260,408
(596,628)
16,424,121
1,339,481
860,111
(550,000)
18,073,713
The recoupment of costs carried forward in relation to areas of interest in the exploration and evaluation phase is dependent
on successful development and commercial exploitation or sale of the respective areas.
1 Earn in arrangements in relation to the Birsok Bauxite Project in Cameroon were terminated during the year.
As the Minim Martap tenements expired and were in the process of being renewed during the period, expenditure incurred
of $794,883 (2022: $4,461,512), as well as acquisition costs, are required to be expensed until such time that the renewals
are finalised, in accordance with the Group's accounting policy.
Confirmation was received that the Makan and Ngaoundal research permits were extended for an additional two years on 25
February 2022, whilst the mining convention negotiations continue for Minim Martap. Expenditure on the Makan and
Ngaoundal exploration permits commenced to be capitalised from 22 February 2022.
Note 12. Current liabilities - trade and other payables
Trade payables
Other payables
30 June 2023 30 June 2022
$
$
680,604
28,376
882,961
178,328
708,980
1,061,289
40
Canyon Resources Limited
Notes to the consolidated financial statements
30 June 2023
Note 13. Current liabilities - provisions
Annual leave
Long service leave
Note 14. Equity - issued capital
30 June 2023 30 June 2022
$
$
32,915
-
61,427
60,000
32,915
121,427
30 June 2023 30 June 2022 30 June 2023 30 June 2022
Shares
Shares
$
$
Ordinary shares - fully paid
1,015,766,507 806,422,064
89,004,240
76,733,044
Movements in ordinary share capital
Details
Date
Shares
$
Balance
Shares issued for cash
Shares issued for cash
Shares issued for cash
Shares issued in lieu of payment
Cost of share issues
Balance
Shares issued for cash
Shares issued for cash
Performance rights converted
Cost of share issues
1 July 2021
9 August 2021
28 June 2022
21 September 2021
7 February 2022
30 June 2022
7 September 2022
22 December 2022
15 March 2023
623,903,552
70,485,675
104,636,355
6,771,482
625,000
-
806,422,064
5,444,443
202,900,000
1,000,000
-
66,543,010
5,638,854
4,708,636
541,719
56,250
(755,425)
$0.080
$0.050
$0.080
$0.090
$0.000
76,733,044
$0.045
245,000
$0.060 12,174,000
$0.000
90,000
$0.000
(237,804)
Balance
30 June 2023
1,015,766,507
89,004,240
Ordinary shares
Ordinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the Company in
proportion to the number of and amounts paid on the shares held. The fully paid ordinary shares have no par value and the
Company does not have a limited amount of authorised capital.
On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each share
shall have one vote.
Capital risk management
The Group's objectives when managing capital is to safeguard its ability to continue as a going concern, so that it can provide
returns for shareholders and benefits for other stakeholders and to maintain an optimum capital structure to reduce the cost
of capital.
Capital is regarded as total equity, as recognised in the statement of financial position, plus net debt. Net debt is calculated
as total borrowings less cash and cash equivalents.
In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders,
return capital to shareholders, issue new shares or sell assets to reduce debt.
41
Canyon Resources Limited
Notes to the consolidated financial statements
30 June 2023
Note 14. Equity - issued capital (continued)
The Group would look to raise capital when an opportunity to invest in a business or company was seen as value adding
relative to the current Company's share price at the time of the investment. The Group is not actively pursuing additional
investments in the short term as it continues to integrate and grow its existing businesses in order to maximise synergies.
The Group is subject to certain financing arrangements covenants and meeting these is given priority in all capital risk
management decisions. There have been no events of default on the financing arrangements during the financial year.
The capital risk management policy remains unchanged from the 30 June 2022 Annual Report.
Note 15. Equity - reserves
Foreign currency reserve
Share-based payments reserve
30 June 2023 30 June 2022
$
$
60,220
6,780,867
(786,966)
6,476,469
6,841,087
5,689,503
Foreign currency reserve
The reserve is used to recognise exchange differences arising from the translation of the financial statements of foreign
operations to Australian dollars. It is also used to recognise gains and losses on hedges of the net investments in foreign
operations.
Share-based payments reserve
The reserve is used to recognise the value of equity benefits provided to employees and Directors as part of their
remuneration, and other parties as part of their compensation for services.
Movements in reserves
Movements in each class of reserve during the current and previous financial year are set out below:
Balance at 1 July 2021
Foreign currency translation
Fair value of shares to be issued for exploration and evaluation acquisition
Performance rights issued to directors/employees
Transfer balance to accumulated losses
Balance at 30 June 2022
Revaluation - gross
Performance rights issued to directors/employees
Performance shares converted
Issue of options
Share based
payment
reserve
$
Foreign
currency
translation
$
1,881,428
-
4,325,000
314,608
(44,567)
6,476,469
-
341,374
(90,000)
53,024
5,524
(792,490)
-
-
-
(786,966)
847,186
-
-
-
Total
$
1,886,952
(792,490)
4,325,000
314,608
(44,567)
5,689,503
847,186
341,374
(90,000)
53,024
Balance at 30 June 2023
6,780,867
60,220
6,841,087
42
Canyon Resources Limited
Notes to the consolidated financial statements
30 June 2023
Note 16. Equity - accumulated losses
Accumulated losses at the beginning of the financial year
Loss after income tax expense for the year
Transfer from share-based payments reserve
Accumulated losses at the end of the financial year
Note 17. Equity - dividends
30 June 2023 30 June 2022
$
$
(62,019,248)
(4,986,711)
-
(49,288,404)
(12,775,411)
44,567
(67,005,959)
(62,019,248)
There were no dividends paid, recommended or declared during the current or previous financial year.
Note 18. Financial instruments
This note provides information about how the Group determines fair values of various financial assets and liabilities.
Liquidity risk
Vigilant liquidity risk management requires the Group to maintain sufficient liquid assets (mainly cash and cash equivalents)
and available borrowing facilities to be able to pay debts as and when they become due and payable.
The Group manages liquidity risk by maintaining adequate cash reserves by continuously monitoring actual and forecast cash
flows and matching the maturity profiles of financial assets and liabilities.
Remaining contractual maturities
The following tables detail the Group's remaining contractual maturity for its financial instrument liabilities. The tables have
been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the financial
liabilities are required to be paid. The tables include both interest and principal cash flows disclosed as remaining contractual
maturities and therefore these totals may differ from their carrying amount in the statement of financial position.
30 June 2023
Non-derivatives
Non-interest bearing
Trade payables
Other payables
Total non-derivatives
30 June 2022
Non-derivatives
Non-interest bearing
Trade payables
Other payables
Total non-derivatives
Weighted
average
interest rate
%
1 year or less
$
Between 1
and 2 years
$
Between 2
and 5 years
$
Over 5 years
$
Remaining
contractual
maturities
$
-
-
680,604
28,376
708,980
-
-
-
-
-
-
-
-
-
680,604
28,376
708,980
Weighted
average
interest rate
%
1 year or less
$
Between 1
and 2 years
$
Between 2
and 5 years
$
Over 5 years
$
Remaining
contractual
maturities
$
-
-
882,961
178,328
1,061,289
-
-
-
-
-
-
-
-
-
882,961
178,328
1,061,289
The cash flows in the maturity analysis above are not expected to occur significantly earlier than contractually disclosed
above.
43
Canyon Resources Limited
Notes to the consolidated financial statements
30 June 2023
Note 19. Key management personnel disclosures
Directors
The following persons were Directors of Canyon Resources Limited during the financial year:
Mark Hohnen
Cliff Lawrenson
Phillip Gallagher
David Netherway
Peter Su
Scott Phegan
Steven Zaninovich
Non-Executive Chairman (appointed 8 August 2022)
Non-Executive Chairman (resigned 8 August 2022)
Managing Director (resigned 11 July 2022)
Non-Executive Director
Non-Executive Director
Non-Executive Director (appointed 8 August 2022)
Non-Executive Director (resigned 8 August 2022)
Other key management personnel
The following persons also had the authority and responsibility for planning, directing and controlling the major activities of
the Group, directly or indirectly, during the financial year:
Jean-Sebastien Boutet
Rick Smith
Chief Executive Officer
Chief Development Officer (resigned 31 December 2022)
Compensation
The aggregate compensation made to Directors and other members of key management personnel of the Group is set out
below:
Short-term employee benefits
Post-employment benefits
Long-term benefits
Share-based payments
Included in Short-term benefits were payments to directors for additional services:
Zivvo Pty Ltd (1) - Consulting Fees
(1) Zivvo Pty Ltd - Steve Zaninovich is a director and shareholder
Note 20. Remuneration of auditors
30 June 2023 30 June 2022
$
$
1,138,507
4,298
-
394,398
1,362,125
30,336
3,845
314,608
1,537,203
1,710,914
30 June 2023 30 June 2022
-
6,200
During the financial year the following fees were paid or payable for services provided by HLB Mann Judd (WA Partnership),
the auditor of the Company:
30 June 2023 30 June 2022
$
$
52,486
49,343
Audit services - HLB Mann Judd (WA Partnership)
Audit or review of the financial statements
Note 21. Contingent liabilities
There are no contingencies outstanding as at 30 June 2023.
44
Canyon Resources Limited
Notes to the consolidated financial statements
30 June 2023
Note 22. Related party transactions
Parent entity
Canyon Resources Limited is the parent entity.
Subsidiaries
Interests in subsidiaries are set out in note 24.
Key management personnel
Disclosures relating to key management personnel are set out in note 19 and the remuneration report included in the
Directors' report.
The following transactions occurred with related parties:
Payment for other expenses:
Rent expense paid to Collab Capital Pty Ltd*
30 June 2023 30 June 2022
$
$
-
12,000
The following balances are outstanding at the reporting date in relation to transactions with related parties:
Current payables:
Trade payables to Collab Capital Pty Ltd*
30 June 2023 30 June 2022
$
$
-
3,300
*
Collab Capital Pty Ltd provided office premises to the Company during the year. Peter Su is a Director and Shareholder
of Collab Capital Pty Ltd.
Terms and conditions
All transactions were made on normal commercial terms and conditions and at market rates.
Note 23. Parent entity information
Set out below is the supplementary information about the parent entity.
Statement of profit or loss and other comprehensive income
Loss after income tax
Other comprehensive income for the year, net of tax
Total comprehensive loss
Parent
30 June 2023 30 June 2022
$
$
(6,186,554)
(13,011,793)
-
(6,186,554)
-
(13,011,793)
45
Canyon Resources Limited
Notes to the consolidated financial statements
30 June 2023
Note 23. Parent entity information (continued)
Statement of financial position
Total current assets
Total assets
Total current liabilities
Total liabilities
Equity
Issued capital
Share-based payments reserve
Accumulated losses
Total equity
Note 24. Interests in subsidiaries
Parent
30 June 2023 30 June 2022
$
$
10,834,715
4,503,463
16,298,298
10,518,578
353,748
963,069
353,748
963,069
89,004,240
6,780,867
(79,840,557)
76,733,044
6,476,469
(73,654,004)
15,944,550
9,555,509
The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in accordance
with the accounting policy described in note 2:
Name
Neufco Pty Ltd
Canyon West Africa Pty Ltd
Askia Sarl Pty Ltd
Canyon Derosa Pty Ltd
Canyon Cameroon Pty Ltd
Askia Minerals Sarl
Canyon West Africa Sarl
CSO Sarl
Deorsa Sarl
Camalco SA
Camalco Holdings Ltd
Principal place of business /
Country of incorporation
Ownership interest
30 June 2023 30 June 2022
%
%
Australia
Australia
Australia
Australia
Australia
Burkina Faso
Burkina Faso
Burkina Faso
Burkina Faso
Cameroon
British Virgin Islands
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
Canyon Resources Limited is the ultimate Australian parent entity and ultimate parent of the Group.
Note 25. Events after the reporting period
Further Strategic Placement to EEA
On 17 August 2023 it was announced that a Subscription Agreement was entered into with Eagle Eye Asset Holdings Pte Ltd
("EEA"), whereby EEA has agreed to subscribe for 150,000,000 new fully paid ordinary shares at $0.07 per Share ("Placement
Shares") and to exercise its existing 202,900,000 options exercisable at $0.07 to convert into fully paid ordinary shares
("Exercise Shares"). Following satisfaction of conditions including shareholder approval, will result in the company raising
$24.7m before costs. The Company will also issue EEA with 500,000,000 new unlisted options exercisable at $0.07 per share
on or before 26 December 2026 ("New Options").
46
Canyon Resources Limited
Notes to the consolidated financial statements
30 June 2023
Note 25. Events after the reporting period (continued)
The issue of the Placement Shares, Exercise Shares and Shares on exercise of the New Options and the resulting increase in
EEA’s relevant interest in the Company is subject to Canyon shareholder approval under item 7 of section 611 of
the Corporations Act 2001 (Cth). The issue of the New Options is subject to Canyon shareholder approval for the purposes of
ASX Listing Rule 7.1. The necessary shareholder approvals will be sought at an extraordinary general meeting to be held in or
around November 2023. A notice of meeting, accompanied by an independent expert’s report, will be provided to
shareholders in due course.
The exercise of the New Options will be subject to:
* the grant of the Mining Licence for the Minim Martap Project ("Project"); and
* a binding contract for port access and rail transportation of product on terms relevant to the Project and customary in the
Central African market being executed by the Company and counterparties.
4,000,000 options exercisable at $0.20 each on or before 7 September 2023 expired unexercised.
No other matter or circumstance has arisen since 30 June 2023 that has significantly affected, or may significantly affect the
Group's operations, the results of those operations, or the Group's state of affairs in future financial years.
Note 26. Reconciliation of loss after income tax to net cash used in operating activities
Loss after income tax expense for the year
Adjustments for:
Depreciation and amortisation
Impairment of plant and equipment
Net loss on disposal of property, plant and equipment
Share-based payments
Foreign exchange differences
Impairment of exploration and evaluation
Change in operating assets and liabilities:
Decrease/(increase) in trade and other receivables
Increase in other operating assets
Increase/(decrease) in trade and other payables
Decrease in employee benefits
Net cash used in operating activities
Note 27. Non-cash investing and financing activities
Issue of performance rights to directors and employees (refer note 28)
Issue of shares on acquisition of exploration project
Issue of ordinary shares in lieu of payment
Options issued to directors (refer note 28)
47
30 June 2023 30 June 2022
$
$
(4,986,711)
(12,775,411)
59,447
33,040
1,017
394,398
(22,614)
550,000
84,789
-
10,779
4,695,858
57,200
-
(131,397)
(8,545)
(352,309)
(88,512)
14,015
(1,633)
21,207
(82,300)
(4,552,186)
(7,975,496)
30 June 2023 30 June 2022
$
$
259,680
-
-
53,024
314,608
4,325,000
56,250
-
312,704
4,695,858
Canyon Resources Limited
Notes to the consolidated financial statements
30 June 2023
Note 28. Share-based payments
Performance rights
CEO Jean-Sebastien Boutet was issued 10,000,000 Performance Rights on 18 July 2022. The Performance Rights were issued
for nil cash consideration and are convertible into fully paid ordinary shares in the capital of the Company on the terms and
conditions under the Canyon Long Term Incentive Plan and subject to the following Vesting Conditions:
Tranche
Vesting conditions
Share Price
Employment
Tenure
Project
Milestones
1
2
3
4
5
6
7
8
9
10
Achievement of a 10-day Volume Weighted Average
Price ('VWAP') of $0.10
Achievement of a 10-day VWAP of $0.15
Achievement of a 10-day VWAP of $0.20
Achievement of a 10-day VWAP of $0.25
12 months continuous employment
24 months continuous employment
36 months continuous employment
Fully approved mining licence
Complete rail access agreement
Executed binding off take agreement for minimum 2MT
for a 12 month period
1,000,000
1,000,000
1,000,000
1,000,000
-
-
-
-
-
-
-
-
-
1,000,000
1,000,000
1,000,000
-
-
-
-
-
-
-
-
-
1,000,000
1,000,000
-
-
1,000,000
4,000,000
3,000,000
3,000,000
These performance rights were valued, using a valuation methodology based on the guidelines set out in AASB 2 Share-based
Payment.
Assumptions:
Share price vesting conditions
Number of performance rights
Valuation date
Interest rate
Volatility rate
Vesting share price
Share price on valuation date
Indicative value per Performance Right
- Mr Jean-Sebastien Boutet
Assumptions:
Employment tenure conditions
Tranche 1
Tranche 2
Tranche 3
Tranche 4
1,000,000
1 January 2022
1.85%
100%
$0.100
$0.096
$0.084
$84,300
1,000,000
1 January 2022
1.85%
100%
$0.150
$0.096
$0.075
$74,900
1,000,000
1 January 2022
1.85%
100%
$0.200
$0.096
$0.0711
$71,100
1,000,000
1 January 2022
1.85%
100%
$0.250
$0.096
$0.070
$69,700
Tranche 5
Tranche 6
Tranche 7
Number of performance rights
Valuation date
10 day VWAP
Indicative value per Performance Right
- Mr Jean-Sebastien Boutet
1,000,000
1 January 2022
$0.090
$0.090
$90,000
1,000,000
1 January 2022
$0.090
$0.090
$90,000
1,000,000
1 January 2022
$0.090
$0.090
$90,000
48
Canyon Resources Limited
Notes to the consolidated financial statements
30 June 2023
Note 28. Share-based payments (continued)
Assumptions:
Project Milestone
Tranche 8
Tranche 9
Tranche 10
Number of performance rights
Valuation date
10 day VWAP
Indicative value per Performance Right
- Mr Jean-Sebastien Boutet
1,000,000
1 January 2022
$0.090
$0.090
$90,000
1,000,000
1 January 2022
$0.090
$0.090
$90,000
1,000,000
1 January 2022
$0.090
$0.090
$90,000
The value of the Performance Rights is being expensed over the deemed life of the Rights. During the period $341,374 was
recognised as an expense in relation to the rights.
Tranche 5 have vested and were converted to ordinary shares on 15 March 2023.
Options
A share option plan has been established by the Group and approved by shareholders at a general meeting, whereby the
Group may, at the discretion of the Nomination and Remuneration Committee, grant options over ordinary shares in the
Company to certain key management personnel of the Group. The options are issued for nil consideration and are granted in
accordance with performance guidelines established by the Nomination and Remuneration Committee.
Weighted
average
exercise price
30 June 2023 30 June 2023 30 June 2022 30 June 2022
Weighted
average
exercise price
Number of
options
Number of
options
Outstanding at the beginning of the financial year
Granted
Expired
4,000,000
3,000,000
(4,000,000)
$0.200
$0.127
$0.200
9,000,000
-
(5,000,000)
$0.200
$0.000
$0.200
Outstanding at the end of the financial year
3,000,000
$0.127
4,000,000
$0.200
Exercisable at the end of the financial year
3,000,000
$0.127
4,000,000
$0.200
Director options
On 2 December 2022, the Company issued 3,000,000 unlisted options to Director Mark Hohnen following shareholder
approval at the AGM on 21 November 2022. The unlisted options were issued in three tranches as follows:
●
●
●
1,000,000 unlisted options exercisable on or before 2 December 2025 at $0.09 each
1,000,000 unlisted options exercisable on or before 2 December 2025 at $0.12 each
1,000,000 unlisted options exercisable on or before 2 December 2025 at $0.17 each
49
Canyon Resources Limited
Notes to the consolidated financial statements
30 June 2023
Note 28. Share-based payments (continued)
For these options, the valuation model inputs used to determine the fair value at the grant date, are as follows:
Number of options
Issue date
Expiry date
Exercise price
Valuation date
Share price at valuation date
Expected volatility
Dividend yield
Risk-free interest rate
Fair value at valuation date
- Mr Mark Hohnen
Tranche 1
Tranche 2
Tranche 3
1,000,000
2 December 2022
2 December 2025
$0.090
21 November 2022
$0.042
100%
-
3.20%
$0.020
$20,287
1,000,000
2 December 2022
2 December 2025
$0.120
21 November 2022
$0.042
100%
-
3.20%
$0.018
$17,823
1,000,000
2 December 2022
2 December 2025
$0.170
21 November 2022
$0.042
100%
-
3.20%
$0.015
$14,914
$53,024 was expensed to share-based payments expense during the period in relation to the options granted.
Total value expensed in profit and loss
Director options
Performance rights issued to employees
Shares issued in lieu of payment
Shares issued on acquisition of Birsok:
Tranche 3
Shares issued on acquisition of Minim Martap:
Tranche 3
Tranche 4
Note 29. Loss per share
Loss after income tax
30 June 2023 30 June 2022
$
$
53,024
341,374
-
394,398
-
-
-
-
-
314,608
56,250
370,858
925,000
1,360,000
2,040,000
3,400,000
394,398
4,695,858
30 June 2023 30 June 2022
$
$
(4,986,711)
(12,775,411)
Number
Number
Weighted average number of ordinary shares used in calculating basic earnings per share
917,323,159 692,714,648
Weighted average number of ordinary shares used in calculating diluted earnings per share
917,323,159 692,714,648
Basic loss per share
Diluted loss per share
50
Cents
Cents
(0.54)
(0.54)
(1.84)
(1.84)
Canyon Resources Limited
Directors' declaration
30 June 2023
In the Directors' opinion:
●
●
●
●
the attached financial statements and notes comply with the Corporations Act 2001, the Accounting Standards, the
Corporations Regulations 2001 and other mandatory professional reporting requirements;
the attached financial statements and notes comply with International Financial Reporting Standards as issued by the
International Accounting Standards Board as described in note 2 to the financial statements;
the attached financial statements and notes give a true and fair view of the Group's financial position as at 30 June 2023
and of its performance for the financial year ended on that date; and
there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due
and payable.
The Directors have been given the declarations required by section 295A of the Corporations Act 2001.
Signed in accordance with a resolution of Directors made pursuant to section 295(5)(a) of the Corporations Act 2001.
On behalf of the Directors
___________________________
Mark Hohnen
Non-Executive Chairman
28 September 2023
51
INDEPENDENT AUDITOR’S REPORT
To the Members of Canyon Resources Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Canyon Resources Limited (“the Company”) and its controlled entities
(“the Group”), which comprises the consolidated statement of financial position as at 30 June 2023, the
consolidated statement of profit or loss and other comprehensive income, the consolidated statement of
changes in equity and the consolidated statement of cash flows for the year then ended, and notes to the
financial statements, including a summary of significant accounting policies, and the directors’ declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act
2001, including:
(a) giving a true and fair view of the Group’s financial position as at 30 June 2023 and of its financial
performance for the year then ended; and
(b) complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those
standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Report section
of our report. We are independent of the Group in accordance with the auditor independence requirements
of the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical
Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence
Standards) (“the Code”) that are relevant to our audit of the financial report in Australia. We have also fulfilled
our other ethical responsibilities in accordance with the Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
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.
52
We have determined the matters described below to be the key audit matters to be communicated in our
report.
Key Audit Matter
How our audit addressed the key audit
matter
Carrying amount of capitalised exploration
expenditure
Note 11 in the financial report
for and
In accordance with AASB 6 Exploration
Evaluation of Mineral Resources, the Group capitalises
acquisition costs for its areas of interest and then
expenses further exploration and evaluation expenditure
as incurred, with the exception of the Minim Martap
the
project where all expenditure
capitalisation criteria is being capitalised. The cost model
is applied after recognition.
that meets
Our audit focussed on the Group’s assessment of the
the capitalised exploration
carrying amount of
expenditure, as this is the most significant asset of the
Group.
Our procedures included but were not limited
to the following:
− We obtained an understanding of the key
processes associated with management’s
review of the carrying values of each area
of interest;
− We considered the Directors’ assessment
of potential indicators of impairment;
− We obtained evidence that the Group has
current rights to tenure of its areas of
interest;
− We examined the exploration budget for
the year ending 30 June 2024 and
discussed with management the nature of
planned ongoing activities;
− We substantiated a sample of exploration
and evaluation transactions; and
− We examined the disclosures made in the
financial report.
Information Other than the Financial Report and Auditor’s Report Thereon
The directors are responsible for the other information. The other information comprises the information
included in the Group’s annual report for the year ended 30 June 2023, 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.
53
In preparing the financial report, the directors are responsible for assessing the ability of the Group to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the going
concern basis of accounting unless the directors either intend to liquidate the Group or to cease operations,
or have no realistic alternative but to do so.
Auditor’s Responsibilities for the Audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from
material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our
opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted
in accordance with Australian Auditing Standards will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate,
they could reasonably be expected to influence the economic decisions of users taken on the basis of this
financial report.
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional judgement
and maintain professional scepticism throughout the audit. We also:
−
Identify and assess the risks of material misstatement of the financial report, whether due to fraud or
error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is
sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material
misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve
collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
− Obtain an understanding of internal control relevant to the audit in order to design audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Group’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the directors.
−
− Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and,
based on the audit evidence obtained, whether a material uncertainty exists related to events or
conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we
conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to
the related disclosures in the financial report or, if such disclosures are inadequate, to modify our
opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report.
However, future events or conditions may cause the Group to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial report, including the disclosures,
and whether the financial report represents the underlying transactions and events in a manner that
achieves fair presentation.
−
We communicate with the directors regarding, among other matters, the planned scope and timing of the
audit and significant audit findings, including any significant deficiencies in internal control that we identify
during our audit.
We also provide the directors with a statement that we have complied with relevant ethical requirements
regarding independence, and to communicate with them all relationships and other matters that may
reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with the directors, we determine those matters that were of most
significance in the audit of the financial report of the current period and are therefore the key audit matters.
54
We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about
the matter or when, in extremely rare circumstances, we determine that a matter should not be
communicated in our report because the adverse consequences of doing so would reasonably be expected
to outweigh the public interest benefits of such communication.
REPORT ON THE REMUNERATION REPORT
Opinion on the Remuneration Report
We have audited the Remuneration Report included within the directors’ report for the year ended 30 June
2023.
In our opinion, the Remuneration Report of Canyon Resources Limited for the year ended 30 June 2023
complies with Section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the Remuneration
Report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an
opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing
Standards.
HLB Mann Judd
Chartered Accountants
Perth, Western Australia
28 September 2023
L Di Giallonardo
Partner
55
Canyon Resources Limited
Corporate governance statement
30 June 2023
Corporate Governance Statement
In fulfilling its obligations and responsibilities to its various stakeholders, the Board is a strong advocate of corporate
governance. This statement outlines the principle corporate governance of Canyon Resources Limited. The Board of Directors
(“Board”) supports a system of corporate governance to ensure that the management of Canyon Resources Limited is
conducted to maximise shareholder wealth in a proper and ethical manner.
ASX Corporate Governance Council Recommendations
The Board has adopted corporate governance policies and practices consistent with the ASX Corporate Governance Council’s
Principles of Good Corporate Governance and Best Practice Recommendations (“ASX Principles and Recommendations 4th
Edition”) where considered appropriate for the Group’s size and nature. Such policies include, but are not limited to the
Board Charter, Board Committee Charters, Code of Conduct, Trading in Securities, Continuous Disclosure, Shareholder
Communication and Risk Management Policies.
Further details in respect to the Group’s corporate governance practices and copies of the Group’s corporate governance
polices and the Corporate Governance Statement, approved by the Board, are available on the Group’s website:
https://canyonresources.com.au/corporate/corporate-governance/
56
Canyon Resources Limited
Shareholder information
30 June 2023
Additional information required by the ASX Listing Rules not disclosed elsewhere in this Annual Report is set out
below.
1. Shareholdings
The issued capital of the Company as at 9 September 2023 is 1,015,766,507 ordinary fully paid shares (details
below). All issued ordinary fully paid shares carry one vote per share.
Ordinary Shares
Holding Ranges
above 0 up to and including 1,000
above 1,000 up to and including 5,000
above 5,000 up to and including 10,000
above 10,000 up to and including
100,000
above 100,000
Totals
Unmarketable parcels
Holders
Total Units
% Issued Share
Capital
92
195
359
1,267
837
2,750
10,427
747,899
2,981,738
53,204,149
958,822,294
1,015,766,507
0.00
0.07
0.29
5.24
94.40
100.00
% IC
19.98
6.65
3.75
2.36
1.75
1.47
1.18
1.10
1.07
0.86
0.80
0.75
0.74
0.71
0.71
0.64
0.63
0.60
0.58
0.55
Holding
202,900,000
67,545,950
38,087,479
24,000,000
17,786,306
14,968,570
11,938,533
11,140,731
10,888,888
8,700,000
8,174,950
7,616,195
7,500,000
7,248,815
7,210,596
6,496,390
6,400,000
6,043,943
5,900,000
5,551,652
476,098,998
46.87
The number of shareholdings held in less than marketable parcels is 658.
2. Top 20 Shareholders as at 9 September 2023
Position
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
Holder Name
CITICORP NOMINEES PTY LIMITED
AUSGLOBAL BAUXITE PTY LTD
WMA HOLDING FZCO
ALTUS STRATEGIES LTD
MAMMON IBT PTY LTD
ZERO NOMINEES PTY LTD
MR DARREN GLENN HARMER
MR CHRISTOPHER JOHN SQUIERS + MR ADRIAN CHRISTOPHER
SQUIERS + MR SASCHA TROY SQUIERS
BLUETAIL INVESTMENTS PTY LTD
DC & PC HOLDINGS PTY LTD
MR JOHN COLIN LOOSEMORE + MRS SUSAN MARJORY LOOSEMORE
TREASURY SERVICES GROUP PTY LTD
FREMANTLE ENTERPRISES PTY LTD
MS WINNIE CHI WONG
MR MICHAEL ARTHUR PARISH
MR MARX LIN
WIDERANGE CORPORATION PTY LTD
MR RAN SHAHAR
MR HOWIE JAMES FITZMAURICE
SISU INTERNATIONAL PTY LTD
Totals
3. Voting Rights
The voting rights attached to each class of equity security are as follows:
57
Canyon Resources Limited
Shareholder information
30 June 2023
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.
The company is listed on the Australian Securities Exchange under the code “CAY”.
4. Substantial shareholders as at 9 September 2023
Number of
Shares Held
202,900,000
Percentage
19.99%
Name
Eagle Eye Asset Holdings Pte. Ltd
5. Unquoted securities
Number
Terms
4,000,000
110,080,798
1,000,000
1,000,000
1,000,000
O12 - UNL OPTS EXP 07/09/23 @ $0.20
O13 - UNL OPTS EXP 10/08/24 @ $0.07
O14 - UNL OPTS EXP 02/12/25 @ $0.09
O15 - UNL OPTS EXP 02/12/25 @ $0.12
O16 - UNL OPTS EXP 02/12/25 @ $0.17
202,900,000
O17 - UNL OPT EXP 10/08/25 @ $0.07
9,000,000
PE1 - PERFORMANCE RIGHTS
6. Unquoted securities holders with greater than 20% of an individual class
Holder
O12 - UNL OPTS
EXP 07/09/23 @
$0.20
2020 ADVISORY PTY LTD
1,000,000
ASHANTI CAPITAL PTY
LTD
THE 5TH ELEMENT
MCTN PTY LTD
FERNAN PTY LTD
Total number of holders
Total holdings over 20%
Other holder
TOTAL
2,000,000
1,000,000
-
3
3
-
3
O13 - UNL
OPTS EXP
10/08/24 @
$0.07
-
O14 - UNL
OPTS EXP
02/12/25 @
$0.09
-
O15 - UNL
OPTS EXP
02/12/25 @
$0.12
-
O16 - UNL
OPTS EXP
02/12/25 @
$0.17
-
-
-
-
-
-
-
1,000,000
1,000,000
1,000,000
1
1
-
1
1
1
-
1
1
1
-
1
-
-
-
107
-
107
107
58
Canyon Resources Limited
Shareholder information
30 June 2023
Holder
EAGLE EYE ASSET HOLDINGS PTE
LTD
CANYON INCENTIVE SCHEME PTY
LTD
Total number of holders
Total holdings over 20%
Other holder
TOTAL
O17 - UNL OPT
EXP 10/08/25 @
$0.07
PE1 -
PERFORMANCE
RIGHTS
1,000,000
-
-
1
1
-
1
9,000,000
1
1
-
1
7. Restricted securities subject to escrow period
The following ordinary shares are subject to escrow:
Holder
EAGLE EYE ASSET HOLDINGS PTE LTD
AUSGLOBAL BAUXITE PTY LTD
TOTAL
Number of Shares
Held
202,900,000
2,670,000
205,570,000
8. On-market buyback
There is currently no on-market buyback program for any of Canyon Resources Limited’s listed securities.
59
Canyon Resources Limited
Interest in mineral permits
30 June 2023
Interest in Mineral Permits
Interest in, situation of and percentage interest in mineral permits held are:
Permits
MINIM MARTAP PROJECT
Ngaoundal
Minim Martap
Makan
Location
Interest
Cameroon
Cameroon
Cameroon
100%
100%
100%
60