2016 ANNUAL REPORT
CORPORATE DIRECTORY/CONTENTS PAGE
CORPORATE DIRECTORY
Board of Directors
Mark Connelly – Non‐Executive Chairman
Archie Koimtsidis – Managing Director
Malik Easah – Executive Director
Mark Thomas – Non‐Executive Director
Simon Jackson – Non‐Executive Director
Company Secretary
Sarah Shipway
Registered Office
Level 1, 115 Cambridge Street
WEST LEEDERVILLE WA 6007
Tel: + 61 8 9322 6600
Fax: + 61 8 9322 6610
Website: www.cardinalresources.com.au
Email: info@cardinalresources.com.au
Ghana Office
Durugu Residential Area
KUMBOSCO, BOLGATANGA, GHANA
Tel: + 233 (0) 261 905 220
Australian Business Number
ABN 56 147 325 620
Share Register
Computershare Investor Services Pty Ltd
Level 11
175 St Georges Terrace
PERTH WA 6000
Tel: 1300 850 505
Int: +61 8 9323 2000
Fax: + 61 8 9323 2033
Stock Exchange Code
CDV – Ordinary Shares
CDVOA – Listed Options
Auditors
Greenwich & Co Audit Pty Ltd
Level 2, 35 Outram Street
WEST PERTH WA 6005
CONTENTS
PAGE
Review of Operations
Directors’ Report
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 Financial Statements
Directors’ Declaration
Auditor’s Independence Declaration
Independent Auditor’s Report
Shareholder Information
Schedule of Tenements
3
14
26
27
28
29
30
51
52
53
55
57
Cardinal Resources Limited – Annual Report 2016
P 2
REVIEW OF OPERATIONS
REVIEW OF OPERATIONS
The Directors are pleased to present their report on Cardinal Resources Limited (Cardinal or the Company) for
the year ended 30 June 2016.
GHANA GOLD PROJECTS
Cardinal Resources Limited, through its wholly owned subsidiary, Cardinal Resources Ghana Limited, holds five
tenements prospective for gold mineralisation in Ghana in two NE‐SW trending Paleo‐Proterozoic granite‐
greenstone belts: the Bolgatanga and Namdini Projects located within the Nangodi and Bole‐Bolgatanga
Greenstone Belts in NE Ghana and the Subranum Project located within the Sefwi Greenstone Belt in SW Ghana
(Figure 1).
Figure 1: Cardinal Resources Tenements in Ghana
Cardinal Resources Limited – Annual Report 2016
P 3
REVIEW OF OPERATIONS
BOLGATANGA PROJECT, GHANA
During the year exploration activities were mainly comprised of RC and diamond drilling at the Namdini Project.
NAMDINI PROJECT
The Namdini tenement is located ~12 km SE from Cardinal’s Ndongo East Prospect and ~6 km SE of the producing
Shaanxi Gold Mine. The area around the original Namdini Licence has been considerably expanded, which is
anticipated to add to the Namdini Licence gold inventory already identified (Figure 2).
Figure 2: Namdini Project Area
Cardinal Resources Limited – Annual Report 2016
P 4
REVIEW OF OPERATIONS
Figure 3: Namdini Project Area of geology and recent drill hole collars (to end June 2016)
(Surface projection from drill holes)
Cardinal Resources Limited – Annual Report 2016
P 5
REVIEW OF OPERATIONS
NAMDINI PROJECT DRILLING
A total of 33 Diamond, 28 RC and 17 RC + Diamond drill holes were completed during the year totalling
17,016.80m. A total of 18,040 samples, including duplicates, blanks and standards, were submitted to SGS
Laboratories in Burkina Faso and Ghana, for standard fire assay (Table 1). QAQC protocols were observed by the
taking of duplicates (RC drilling), and inserting in‐house blanks and commercial certified reference material
(CRM) as standards.
Drill Method
DD Drilling
RC Drilling
RC+DD tails
Totals
No. Holes
33
28
17*
Total (m)
10,358.92
2,570.30
4,087.58
17,016.80
No. Samples
10,510
2,506
4,004
17,020
Duplicates
Blanks
Standards
0
124
71
195
250
64
98
412
251
62
100
413
*4 RC+DD drill holes reported with only RC portions drilled during this reporting period
Table 1: Namdini Drilling (to end June 2016)
Diamond Drilling
The drill rigs for the diamond drill holes were all aligned at ‐65⁰ dip drilling east which allows for the
shallowing of the drill hole with depth. The azimuth was set at 095⁰ instead of 100⁰ (normal to the strike of
the formations) as the borehole trace usually deflects to the right with depth due to the clockwise rotation
of the drill rods.
The diamond drill holes were cored from surface. The soft near surface materials were drilled with a Triple
Tube core barrel to reduce core losses. Once harder rock was encountered, then HW steel casing was
inserted for drill hole stability and HQ size core was drilled to their final depths.
The diamond drill holes were surveyed near the top of each drill hole, then every 30m down the hole to
determine the dip and azimuth of the drill holes with depth.
RC Drilling
The general strike of the host rocks is 010⁰ and dipping at approximately ‐60⁰ W. The RC drilling was orientated
normal (at 90⁰) to the strike of 100⁰ azimuth with all drill holes inclined to the east as these drill holes were all
planned to be relatively shallow and did not deviate very much from their intended planned directions.
The soft near surface materials were drilled until harder formations were encountered, then PVC casings
were inserted for drill hole stability. The transition and fresh rocks were drilled with button bits attached to
the hammer and dry chips were recovered at 1m intervals through a cyclone.
Combination RC and Diamond Drilling
Where deeper drilling was planned, RC drilling was initially done until water was encountered, then HW
steel casing was inserted for drill hole stability and HQ size core was drilled to the planned final depths.
The RC drill hole was surveyed only for dip at the end of the RC drilled portion of the drill hole as the azimuth
could not be determined due to the proximity of the metal rods which affects the magnetic readings. The
drill hole was surveyed for both azimuth and dip a short distance below the end of the HW casing, and then
every 30m down the hole to determine the dip and azimuth of the drill hole until completed.
Cardinal Resources Limited – Annual Report 2016
P 6
REVIEW OF OPERATIONS
Diamond Drill Core
The core was orientated at each drill run using a digital instrument. The core was marked showing the base
of the drill hole, then the core from each drill run was laid in a length of angle iron to fit the core together
so that the orientation line could be drawn along the length of the core at the drill site. Initial geotechnical
parameters were measured at the drill site, with more detailed parameters measured in the core shed using
this orientation line as the datum line.
The core was photographed, cut in half, then quartered, with the same quarter sector consistently sampled
to reduce sample bias. The remaining three quarters of core were stored in metal core trays and placed on
metal racks under cover in the core shed at Bolgatanga (Figure 4). The quarter core samples were sent to
the SGS Laboratories in both Burkina Faso and Tarkwa, Ghana for fire assay to speed up the receipt of
results.
Figure 4: Core trays stacked under cover in Bolgatanga core shed
RC Drill Sampling
28 RC drill holes were completed which generated a total of 2,756 samples, including duplicates, blanks and
standards (Table 1), submitted to the SGS Laboratories in Burkina Faso and Tarkwa, Ghana for assaying by
standard fire assay methods. The addition of duplicates, blanks and standards into the sample stream were to
observe the normal QAQC protocols to verify sample accuracy and repeatability by the two laboratories.
RC samples were weighed and split in the field to obtain two samples from each 1m drilled, with 1 sample for
laboratory analysis and the other stored at the Bolgatanga core yard for repeat analyses if required. Chips
selected from each 1m sample bag were washed, placed in chip trays, logged and photographed both dry and
wet. Completed chip trays were stored at the Bolgatanga core shed.
Cardinal Resources Limited – Annual Report 2016
P 7
REVIEW OF OPERATIONS
NDONGO PROSPECT
Ndongo Far East Prospect
The airborne geophysical survey over the Ndongo Tenement identified a magnetic body intruded into the low
pressure dilation zone around the southern and SE margins of the Pelungu Granite (Figure 5).
Figure 5: Ndongo Far East Prospect
Previous geochemical sampling in this area delineated anomalous gold‐in‐soil values around the margins of this
magnetic intrusive (Figure 6).
Figure 6: Ndongo Far East Prospect with gold‐in‐soil anomalies around magnetic intrusive
Cardinal Resources Limited – Annual Report 2016
P 8
REVIEW OF OPERATIONS
Gradient Array Induced Polarisation (GAIP) and Ground Magnetic (Gmag) surveys were completed over this
target area during this review period. Southern Geoscience Consultants (SGC) of Perth, Western Australia have
been contracted to process and interpret the acquired data which should indicate whether any gold‐bearing
sulphides are developed around the margins, or within, this magnetic intrusive. The results of these surveys are
awaited.
BONGO PROSPECT
The airborne geophysical survey over the Bongo Prospect delineated six interpreted target areas containing ~40
km of possible mineralised structures (Figure 7).
Figure 7: Bongo Prospect ‐ 2013 airborne survey magnetic image
with preliminary interpretation and six target zones
Target areas C and D were field checked to assess their suitability for Gradient Array Induced Polarisation (GAIP)
surveys over them. Target C has the potential to contain base metal sulphides while Target D has the potential
to contain gold‐bearing sulphides.
KUNGONGO PROSPECT
The airborne geophysical survey over the Kungongo Prospect delineated two interpreted target areas (“A” and
“B”) containing possible mineralised structures (Figure 8).
Target A occurs over a ~6‐6.5 km long portion of the SW extension of the regional Bole‐Bolgatanga Fault (Shear)
Zone which extends over northern Ghana. Target B occurs over a ~7 km long area underlain by Birimian
greenstones and granitoids.
Target A: Gradient Array Induced Polarisation (GAIP) and Ground Magnetic (Gmag) surveys were completed over
this target area during this review period (Figure 9). Southern Geoscience Consultants (SGC) of Perth, Western
Australia have been contracted to process and interpret the acquired data which should indicate whether any
gold‐bearing sulphides are developed along this shear zone.
A soil auger program is planned over this target area to identify anomalous zones, followed by RC and diamond
drill programs to assess these anomalies.
Target B: A soil sampling program over Target B is planned to identify anomalous zones, followed by a RC drill
program to assess these anomalies.
Cardinal Resources Limited – Annual Report 2016
P 9
REVIEW OF OPERATIONS
Figure 8: Kungongo – 2013 airborne survey magnetic image
with preliminary interpretation and two target zones
Figure 9: Target A, Kungongo Prospect with initial target areas
Cardinal Resources Limited – Annual Report 2016
P 10
REVIEW OF OPERATIONS
SUBRANUM PROJECT
Previous exploration at Subranum has established that the significant anomalous zone has a 5.2km strike length.
Previous drilling, however, had been on 11 fences of varying distances between 200m to >500m apart (Figure
10).
To properly evaluate the gold mineralisation contained within these anomalous zones, Cardinal has planned a
systematic diamond drilling program at regular intervals across the strike length of these anomalies. This planned
program will then determine whether the gold mineralisation is continuous or not, and whether there is a plunge
to the mineralisation.
This drill program is being planned subject to seasonal conditions.
Figure 10: Historical RC drill holes (Newmont) with significant gold intersections highlighted.
Magnetic greyscale image in background.
Cardinal Resources Limited – Annual Report 2016
P 11
REVIEW OF OPERATIONS
JORC 2012
The information in this operations report contains information extracted from the following ASX announcements
which are available for viewing on the Company’s website www.cardinalresources.com.au:
28 June 2016
17 June 2016
31 May 2016
25 May 2016
10 May 2016
29 April 2016
13 April 2016
12 April 2016
7 April 2016
03 December 2015
18 August 2015
29 July 2015
310m Wide Gold Zone Intersected at Namdini Project
190m Wide Gold Zone with Infill Drilling at Namdini
220m Wide Gold Zone with Infill Drilling at Namdini
Wide Gold Zones Continues with Infill Drilling at Namdini
Wide Gold Zones Continue at Namdini Project
Visible Gold in Diamond Drill Hole
Strike Extension Ground Geophysics Begins at Namdini
Additional Drill Rigs on Site to Expedite Program
Additional Near Surface Gold Mineralisation at Namdini
133m Gold Intersection within Diamond Drill Hole
67m High Grade Gold Zone at Namdini Extension
83m Mineralised Zone Further Along Strike at Namdini
No New Information
The Company confirms that it is not aware of any new information or data that materially affects the information
included in any original ASX market announcements relating to exploration activities (including exploration
results) carried out at Bolgatanga, Namdini and Subranum and that all material assumptions and technical
parameters underpinning the exploration activities (including exploration results) and estimates of mineral
resources or ore reserves in the relevant market announcements continue to apply and have not been materially
changed. The Company confirms that the form and context in which the Competent Person’s findings are
presented have not been materially modified from the original market announcements.
CORPORATE UPDATE
The Company completed a number of successful capital raising initiative during the year.
On 21 September 2015 the Company confirmed it had successfully completed a capital raising to sophisticated
and institutional investors to issue 52,215,000 fully paid ordinary shares at $0.10 per share, together with one
free attaching listed option (“Listed Option”) for every two shared subscribed for, exercisable at $0.15 on or
before 30 September 2019, (‘September 2015 Placement”). 26,107,500 fully paid ordinary shares and all the
options were issued on 19 November 2015 after being approved at the Company’s shareholder meeting held on
3 November 2014.
Further on 27 November 2015 the Directors of the Company (namely, Messrs Alec Pismiris, Archie Koimtsidis,
Malik Easah, Simon Jackson and Mark Thomas) were allotted 8,117,116 fully paid ordinary shares and 4,058,558
Listed Option, on the same terms and conditions as the September 2015 Placement.
On 8 March 2016 the Company confirmed it had successfully completed a capital raising to sophisticated and
institutional investors to issue 47,333,300 fully paid ordinary shares at $0.12 per share (“March 2016
Placement”). 4,666,668 fully paid ordinary shares were issued on 9 May 2016 after being approved at the
Company’s shareholder meeting held on 27 April 2016.
Further on 9 May 2016 the Directors of the Company (namely, Messrs Archie Koimtsidis, Malik Easah and Mark
Thomas) were allotted 1,750,002 fully paid ordinary shares, on the same terms and conditions as the March
2016 Placement.
Cardinal Resources Limited – Annual Report 2016
P 12
REVIEW OF OPERATIONS
Appointment of Chairman
On 19 November 2015 the Company announced that Mark Connelly had been appointed as the Non‐Executive
Chairman of the Company.
Mr Connelly has more than 27 years of experience in the mining industry, and has held senior executive positions
with Newmont Mining Corporation and Inmet Mining Corporation. He has extensive experience in financing,
development, construction and operation of mining projects in a variety of commodities including gold, base
metals and other resources in West Africa, Australia, North America and Europe.
Mr Connelly replaces Mr Alec Pismiris, who resigned from the Board.
Cardinal Resources Limited – Annual Report 2016
P 13
DIRECTORS’ REPORT
The Directors of Cardinal Resources Limited submit herewith the annual financial report of Cardinal Resources
Limited for the period 1 July 2015 to 30 June 2016. In order to comply with the provisions of the Corporations Act
2001, the Directors report as follows:
DIRECTORS
The names and particulars of the directors of the Company as at 30 June 2016 and at the date of this report are
as follows. Directors were in office for the entire period unless otherwise stated.
MARK CONNELLY
Non‐Executive Chairman
Appointed 19 November 2015
Mr Connelly is the former Managing Director and Chief Executive Officer of Papillon Resources Limited, a Mali‐
based gold developer which recently merged with Vancouver‐based B2Gold Corp in a US$570 million deal.
Previously he was Chief Operating Officer of Endeavour Mining Corporation following its merger with Adamus
Resources Limited where he was Managing Director and CEO.
Mr Connelly has more than 27 years of experience in the mining industry, and has held senior executive positions
with Newmont Mining Corporation and Inmet Mining Corporation. He has extensive experience in financing,
development, construction and operation of mining projects in a variety of commodities including gold, base
metals and other resources in West Africa, Australia, North America and Europe.
During the past 3 years he has also served as a director of the following listed companies;
Company
West African Resources
Saracen Mineral Holdings
Ausdrill
Tiger Resources Limited
B2 Gold Corp
Manas Resources Ltd
Papillion Resources Limited
ARCHIE KOIMTSIDIS MBA
Managing Director
Appointed 27 December 2012
Date of Appointment
23 June 2015
15 April 2015
25 July 2012
31 December 2015
3 October 2014
1 January 2013
27 November 2012
Date of Resignation
Not Applicable
Not Applicable
Not Applicable
Not Applicable
10 June 2016
10 June 2015
2 October 2014
Mr Koimtsidis has for the last 23 years been involved in all facets of gold exploration, discovery, production and
refining in West Africa and South America.
His most recent appointment prior to joining Cardinal was as the Deputy Country Manager of Ghana for PMI Gold
Limited a joint TSXV and ASX listed company. During this time he was responsible for all field operational matters
including coordination of exploration, drilling programs and human resource management relation to the
Company’s projects in Ghana.
Mr Koimtsidis has been instrumental in acquiring the Ghanaian projects on behalf of Cardinal and has a unique
knowledge and understanding of geopolitical and operational matters relating to resources projects in West
Africa.
During the past three years he has held no other listed company directorships.
Cardinal Resources Limited – Annual Report 2016
P 14
DIRECTORS’ REPORT
MALIK EASAH
Executive Director
Appointed 27 December 2012
Mr Malik Easah is the principal of successful alluvial mining operations in the North West Adansi Gold Obotan
concession and is currently developing additional payable gold permits within the Ashanti and Nangodi Gold belts
of Ghana.
Mr Easah specializes in the manufacture of alluvial gold wash plants and recovery equipment and is regarded as
an authority in the development of alluvial mining operations in Ghana.
Mr Easah is a resident in Ghana.
During the past three years he has held no other listed company directorships.
MARK THOMAS B.Sc (Hons)
Non‐Executive Director
Appointed 31 August 2015
Mark Thomas has over 28 years’ experience in exploration and mining geology, geostatistics and mining finance.
In 1994 Mr Thomas joined Macquarie Bank Limited in the Metals and Energy Capital Division undertaking a broad
range of equity and debt finance transactions in the mining sector.
Mr Thomas was an Executive Director of Macquarie Bank for 11 years until his retirement in late 2014. He has
extensive equity investment and banking experience with gold projects in West Africa, including undertaking
transactions for several of the significant gold mining projects developed in Ghana over the past two decades.
Mr Thomas is a graduate from the University of Wales with a Bachelor of Science (Hons) in Geology.
During the past three years he has held no other listed company directorships.
SIMON JACKSON B.Com, FCA
Non‐Executive Director
Appointed 31 August 2015
Simon Jackson is a Chartered Accountant with over 25 years gold industry experience in Australia and Africa.
Mr Jackson is the CEO and Managing Director at Beadell Resources Ltd, a Brazilian gold producer. Prior to this he
was the Vice President Corporate Development and formerly the Chief Financial Officer for Red Back Mining Inc
prior to its takeover by Kinross Gold Corporation in September 2010. He was an integral part of the senior
management team that saw Red Back's market capitalisation grow from C$40 million in 2004 upon listing on TSX
to over C$9 billion on takeover.
Mr Jackson is currently MD and CEO of Beadell Resources Ltd (ASX: BDR), Non‐Executive Director of Sarama
Resources Ltd (TSXV: SWA) and Chairman of Orca Gold Inc. (TSXV: ORG). He holds a Bachelor of Commerce degree
from the University of Western Australia and is a Fellow of the Institute of Chartered Accountants in Australia,
initially spending 8 years with KPMG.
Cardinal Resources Limited – Annual Report 2016
P 15
DIRECTORS’ REPORT
During the past 3 years he has also served as a director of the following listed companies;
Company
Beadell Resources Limited
Sarama Resources Ltd
Orca Gold Inc.
RB Energy Inc.
ALEC PISMIRIS B.Com, IGIA, MAICD
Non‐Executive Chairman
Appointed 11 November 2010
Retired 19 November 2015
Date of Appointment
10 November 2013
11 March 2011
4 April 2013
31 January 2014
Date of Resignation
Not Applicable
Not Applicable
Not Applicable
2 April 2015
Mr Pismiris is currently a director of Capital Investment Partners, a company which provides corporate advisory
services. Since 1990 Mr Pismiris has served as a director and company secretary for various ASX listed companies
as well as a number of unlisted public and private companies.
Mr Pismiris completed a Bachelor of Commerce degree at the University of Western Australia, is a member of the
Australian Institute of Company Directors and is an associate of The Governance Institute of Australia. Mr Pismiris
has over 25 years’ experience in the securities, finance and mining industries. Mr Pismiris has participated
numerous times in the processes by which boards have assessed the acquisition and financing of a diverse range
of assets and has participated in and become familiar with the range of evaluation criteria used and the due
diligence processes commonly adopted in the commercial assessment of corporate opportunities.
COMPANY SECRETARY
Sarah Shipway was appointed Company Secretary of Cardinal Resources on 27 December 2012. Sarah has a
Bachelor of Commerce from Murdoch University and is a member of the Institute of Chartered Accountants.
DIRECTORS’ INTEREST
At the date of this report, unless otherwise stated, the Directors held the following interests in Cardinal Resources.
Name
Mark Connelly
Archie Koimtsidis
Malik Easah
Mark Thomas
Simon Jackson
Alec Pismiris
Note
Ordinary
Shares
Listed
Options
Unlisted
Options
1
‐
‐
‐
‐
1
‐
8,117,565
7,681,815
3,833,334
1,000,000
3,300,000
‐
4,191,731
6,560,423
1,950,000
500,000
2,227,500
1,000,000
3,000,000
2,000,000
1,500,000
1,000,000
‐
Class A
Performance
Shares
‐
10
10
‐
‐
‐
Note 1: Directors holdings as at the date of retirement or appointment, being 19 November 2015
Other than detailed below, the Directors have no interest, whether directly or indirectly, in a contract or proposed
contract with Cardinal Resources Limited during the financial year end.
PRINCIPAL ACTIVITIES
The principal activity of the Group is mineral exploration in Ghana.
Cardinal Resources Limited – Annual Report 2016
P 16
DIRECTORS’ REPORT
RESULTS AND REVIEW OF OPERATIONS
The result of the consolidated entity for the financial year from 1 July 2015 to 30 June 2016 after income tax was
a loss of $9,243,909 (2015: loss of $3,580,551).
The net assets of the consolidated group have increased from $983,603 in 30 June 2015 to $3,948,069 in 2016.
This increase in largely due to the proceeds from the March 2016 share issue raising $5,889,997.
The directors’ believe the Group is in a strong and stable financial position to expand and grow its current
operations.
A review of operations of the consolidated entity during the year ended 30 June 2016 is provided in the “Review
of the Operations” immediately preceding this Directors’ Report.
LIKELY DEVELOPMENTS
The Group’s focus over the next financial year will be on its key projects – the Ghanaian tenements. Further
commentary on planned activities at these projects over the forthcoming year is provided in the “Review of
Operations”.
The Board will continue to focus on creating value from the Company’s existing resource assets, as well as pursuing
new opportunities in resources sector to complement the Company’s current projects.
SIGNIFICANT CHANGES IN STATE OF AFFAIRS
There have not been any significant changes in the state of affairs of the Group during the financial year, other
than as noted in this financial report.
ENVIRONMENTAL ISSUES
The Group is aware of its environmental obligations with regards to its exploration activities and ensures that it
complies with all applicable regulations when carrying out exploration work.
DIVIDENDS PAID OR RECOMMENDED
The directors do not recommend the payment of a dividend and no amount has been paid or declared by way of
a dividend to the date of this report.
DIRECTORS’ MEETINGS
The following table sets out the number of meetings held during each director’s period of directorship during the
year ended 30 June 2016 and the number of meetings attended by each director.
Name
Mark Connelly
Archie Koimtsidis
Malik Easah
Mark Thomas
Simon Jackson
Alec Pismiris
Note
1
‐
‐
‐
‐
1
Eligible to attend
5
10
10
6
6
5
Attended
5
10
8
6
6
5
Note 1: Mr Connelly was appointed on 19 November 2015 and Mr Pismiris retired on 19 November 2015
Cardinal Resources Limited – Annual Report 2016
P 17
DIRECTORS’ REPORT
REMUNERATION REPORT – AUDITED
Remuneration policy
The remuneration policy of Cardinal Resources Limited has been designed to align directors’ objectives with
shareholder and business objectives by providing a fixed remuneration component, which is assessed on an annual
basis in line with market rates. The Board of Cardinal Resources Limited believes the remuneration policy to be
appropriate and effective in its ability to attract and retain the best directors to run and manage the Company.
The Board’s policy for determining the nature and amount of remuneration for Board members is as follows:
The remuneration policy and setting the terms and conditions for the Executive directors and other senior
staff members is developed and approved by the Board based on local and international trends among
comparative companies and industry generally. It examines terms and conditions for employee incentive
schemes, benefit plans and share plans. Independent advice is obtained when considered necessary to
confirm that executive remuneration is in line with market practice and is reasonable within Australian
executive reward practices.
All executives receive a base salary (which is based on factors such as length of service and experience) and,
if applicable, statutory superannuation.
The Group is an exploration entity, and therefore speculative in terms of performance. Consistent with
attracting and retaining talented executives, directors and senior executives are paid market rates associated
with individuals in similar positions within the same industry. Options and performance incentives may be
issued particularly as the entity moves from an exploration to a producing entity and key performance
indicators such as profit and production and reserves growth can be used as measurements for assessing
executive performance.
The Board policy is to remunerate non‐executive directors at market rates for comparable companies for time,
commitment and responsibilities. The Executive Directors, in consultation with independent advisors,
determine payments to the non‐executives and review their remuneration annually, based on market
practice, duties and accountability. The maximum aggregate amount of fees that can be paid to non‐executive
directors is subject to approval by shareholders at the Annual General Meeting and is currently $350,000 per
annum. Fees for independent non‐executive directors are not linked to the performance of the Group. To
align Directors’ interests with shareholder interests, the directors are encouraged to hold shares in the
Company.
During the financial year the Company did not employ the use of remuneration consultants.
Details of key management personnel (KMP)
Directors
M Connelly
A Koimtsidis
M Easah
M Thomas
S Jackson
A Pismiris
Title
Non‐Executive Chairman
Managing Director
Executive Director
Non‐Executive Director
Non‐Executive Director
Non‐Executive Chairman
Date of Appointment
19 November 2015
27 December 2012
27 December 2012
31 August 2015
31 August 2015
11 November 2010
Date of Retirement
Not Applicable
Not Applicable
Not Applicable
Not Applicable
Not Applicable
19 November 2015
The Company does not have any key management personnel that are not Directors.
Executive Directors’ remuneration and other terms of employment are reviewed annually by the non‐executive
director(s) having regard to performance against goals set at the start of the year, relative comparable information
and independent expert advice.
Cardinal Resources Limited – Annual Report 2016
P 18
DIRECTORS’ REPORT
Except as detailed in the Director’s Report, no director has received or become entitled to receive, during or since
the financial year end, a benefit because of a contract made by the Group or a related body corporate with a
director, a firm of which a director is a member or an entity in which a director has a substantial financial interest.
This statement excludes a benefit included in the aggregate amount of emoluments received or due and receivable
by directors and shown in the Remuneration Report, prepared in accordance with the Corporations regulations,
or the fixed salary of a full time employee of the Group.
Employment Details of Members of Key Management Personnel
The following table provides employment details of persons who were, during the financial year, members of KMP
of the consolidated group. The table also illustrates the proportion of remuneration that was performance and
non‐performance based.
Position Held
as at 30 June
2016 and any
change during
the year
Contract
Details
(Duration and
Termination)
Proportion of Elements of
Remuneration Related to
Performance (Other than Options
Issued)
Shares/Units
Proportion of
Elements of
Remuneration
Not Related to
Performance
Fixed
Salary/Fees
Non‐Salary
Cash‐Based
Incentives
%
‐
‐
‐
‐
‐
‐
M Connelly
A Pismiris
A Koimstidis
Non‐Executive
Chairman
commenced on
19 November
2015
Non‐Executive
Chairman
resigned on 19
November 2015
Managing
Director
M Easah
Executive
Director
M Thomas
S Jackson
Non‐Executive
Director
commenced on
31 August 2015
Non‐Executive
Director
commenced on
31 August 2015
No fixed term
No fixed term
3‐year contract,
3 months’
notice required
to terminate.
No fixed term,
12 months’
notice required
to terminate.
No fixed term
No fixed term
%
‐
%
26.60%
‐
‐
‐
‐
‐
100%
45.10%
48.31%
31.25%
36.29%
The employment terms and conditions of all KMP are formalised in contracts of employment.
Terms of employment require that the Group is not required to provide an executive contracted person with a
minimum notice period prior to termination of contract, unless otherwise stated above. Termination payments
are not payable on resignation or under the circumstances of unsatisfactory performance.
Cardinal Resources Limited – Annual Report 2016
P 19
DIRECTORS’ REPORT
Remuneration of key management personnel
Remuneration for the financial year ended 30 June 2016.
Short‐Term Benefits
Directors
Salary,
Fees and
Leave
Eligiable
Termination
Payment
Non
Monetary
Post Employment
Benefits
Superannuation
Long
Term
Benefits
Long
Service
Leave
Equity Settled
Share‐Based
Payments
Shares/Options
Total
$
$
(ii)
$
M Connelly (iii)
2016
2015
A Koimtsidis
2016
2015
M Easah
2016
2015
M Thomas
2016
2015
S Jackson
2016
2015
A Pismiris (iii)
2016
2015
M Michael (iv)
2016
2015
Total
2016
2015
$
29,476
‐
222,500
110,000
168,995
75,000
55,750
‐
46,750
‐
17,000
36,000
‐
45,000
540,471
266,000
$
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
20,000
‐
20,000
(i)
$
1,054
‐
4,230
4,294
2,996
2,927
1,689
‐
1,215
‐
144
1,405
‐
2,704
11,328
11,330
2,800
‐
‐
‐
‐
‐
5,296
‐
4,441
‐
‐
‐
‐
4,275
12,537
4,275
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
$
125,330
‐
502,730
114,294
355,991
77,927
200,735
‐
144,406
‐
17,144
37,405
‐
71,979
92,000
‐
276,000
‐
184,000
‐
138,000
‐
92,000
‐
‐
‐
‐
‐
782,000
‐
1,346,336
301,605
(i)
(ii)
(iii)
(iv)
Non monetary benefits are for directors’ and officers’ liability and legal expense insurance premiums.
Unlisted options were granted as part of remuneration.
M Connelly was appointed on 19 November 2015 and A Pismiris retired on 19 November 2015.
M Michael retired on 11 June 2015.
Cardinal Resources Limited – Annual Report 2016
P 20
DIRECTORS’ REPORT
Shareholdings of key management personnel
Director
M Connelly
A Koimtsidis
M Easah
M Thomas
S Jackson
A Pismiris
Balance at
Beginning
of Year (iv)
Granted as
Remuneration
During the
Year
Issued on
Exercise of
Options
During the
Year
Other Changes During
the Year (i), (ii), (iii)
Balance at End of
Year
(v)
‐
5,265,000
4,829,250
‐
‐
3,000,000
13,094,250
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
1,852,565
1,852,565
3,833,334
1,000,000
300,000
8,838,464
‐
7,117,565
6,681,815
3,833,334
1,000,000
3,300,000
21,932,714
(i)
(ii)
(iii)
(iv)
(v)
On 7 August 2015 1,838,462 fully paid ordinary shares and 1,838,462 Options exercisable at $0.15 on or
before 30 September 2019 were issued to directors on the same terms and conditions as the June 2015
Placement. The Directors’ placement was approved at the Company General Meeting held on 27 July
2015.
On 27 November 2015 7,117,116 fully paid shares and 3,558,558 Options exercisable at $0.15 on or before
30 September 2019 were issued to directors on the same terms and conditions as the September 2015
Placement. The Directors’ placement was approved at the Company Annual General Meeting held on 19
November 2015.
On 9 May 2016 1,750,002 fully paid shares were issued to directors on the same terms and conditions as
the March 2016 Placement. The Directors’ placement was approved at the Company General Meeting
held on 27 April 2016.
Balance at the beginning of the financial year or at date of appointment, for those Directors who were
appointed during the financial year.
Balance at the end of the financial year or at date of retirement, for Directors who retired before financial
year end.
Listed Option holdings of key management personnel
Directors
Mark Connelly
Archie Koimtsidis
Malik Easah
Mark Thomas
Simon Jackson
Alec Pismiris
Total
Balance at
Beginning of
Year
(iv)
‐
3,172,500
6,003,500
‐
‐
1,927,500
11,103,500
Granted as
remuneration
Expired during
the year
Other Changes
During the Year
(ii), (iii)
Balance at
End of Year
(v)
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
1,019,231
2,852,565
1,950,000
500,000
300,000
6,621,796
‐
4,191,731
8,856,065
1,950,000
500,000
2,227,500
17,725,296
(i)
(ii)
(iii)
Expiry of listed options.
On 7 August 2015 1,838,462 fully paid ordinary shares and 1,838,462 Options exercisable at $0.15 on or
before 30 September 2019 were issued to directors on the same terms and conditions as the June 2015
Placement. The Directors’ placement was approved at the Company General Meeting held on 27 July
2015.
On 27 November 2015 7,117,116 fully paid shares and 3,558,558 Options exercisable at $0.15 on or before
30 September 2019 were issued to directors on the same terms and conditions as the September 2015
Placement. The Directors’ placement was approved at the Company Annual General Meeting held on 19
November 2015.
Cardinal Resources Limited – Annual Report 2016
P 21
DIRECTORS’ REPORT
(iv)
(v)
Balance at the beginning of the financial year or at date of appointment, for those Directors who were
appointed during the financial year.
Balance at the end of the financial year or at date of retirement, for Directors who retired before financial
year end.
Unlisted Option holdings of key management personnel
Directors
Balance at
1 July 2015
(iii)
Granted as
remuneration
(ii)
Grant
Value
($)
Expired
during the
year (i)
Net other
change
Mark Connelly
Archie Koimtsidis
Malik Easah
Mark Thomas
Simon Jackson
Alec Pismiris
Total
‐
‐
‐
‐
‐
544,712
544,712
1,000,000
3,000,000
2,000,000
1,500,000
1,000,000
‐
8,500,000
92,000
276,000
184,000
138,000
92,000
‐
782,000
‐
‐
‐
‐
‐
(544,712)
(544,712)
‐
‐
‐
‐
‐
‐
‐
Balance at
30 June
2016
(iv)
1,000,000
3,000,000
2,000,000
1,500,000
1,000,000
‐
8,500,000
(i)
(ii)
(iii)
(iv)
Expired during the year.
On the 18 March 2016 the Company issued unlisted employee options, exercisable at $0.22 on or before
18 March 2020. The employee options were approved at the Company’s General Meeting held on 17
February 2016.
Balance at the beginning of the financial year or at date of appointment, for those Directors who were
appointed during the financial year.
Balance at the end of the financial year or at date of retirement, for Directors who retired before financial
year end.
Directors
Mark Connelly
Archie Koimtsidis
Malik Easah
Mark Thomas
Simon Jackson
Total
Balance at end of
Year
No.
1,000,000
3,000,000
2,000,000
1,500,000
1,000,000
8,500,000
Exercisable
Vested
Unexercisable
No.
1,000,000
3,000,000
2,000,000
1,500,000
1,000,000
8,500,000
No.
‐
‐
‐
‐
‐
‐
Total at End
of Year
No.
1,000,000
3,000,000
2,000,000
1,500,000
1,000,000
8,500,000
Unvested
Total at End
of Year
No.
‐
‐
‐
‐
‐
‐
Description of Options Issued as Remuneration
Details of the options‐grated as remuneration to key management personnel are as follows:
Grant Date
Issuer
Entitlement on
Exercise
Dates
Exercisable
Exercise
Price $
18.03.2016 Cardinal
Resources
Limited
1:1 Ordinary
Shares in Cardinal
Resources Limited
18.03.2020
$0.22
Option values at grant date were determined using the Black‐Scholes method.
Value Per
Option at
Grant Date
$
$0.092
Amount
Paid/Payable
by Recipient
$0
Cardinal Resources Limited – Annual Report 2016
P 22
DIRECTORS’ REPORT
Class A Performance Shareholdings of key management personnel
Directors
Mark Connelly
Archie Koimtsidis
Malik Easah
Mark Thomas
Simon Jackson
Alec Pismiris
Total
Balance at
1 July 2015
(ii)
Granted as
remuneration
Net other change
Balance at
30 June 2016
(i)
‐
10
10
‐
‐
‐
20
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
10
10
‐
‐
‐
20
(i)
(ii)
(iii)
Balance at the end of the financial year or at date of retirement, for Directors who retired before financial
year end.
Balance at the beginning of the financial year or at date of appointment, for those Directors who were
appointed during the financial year.
On satisfaction of certain milestone events, each Class A Performance Share converts into 100,000
ordinary shares (refer to note 14) in which case each Director holding the Class A Performance Shares
would become entitled to a further 1,000,000 ordinary shares.
Class B Performance Shareholdings of key management personnel
Directors
Mark Connelly
Archie Koimtsidis
Malik Easah
Mark Thomas
Simon Jackson
Alec Pismiris
Total
Balance at
1 July 2015
(ii)
Granted as
remuneration
Net other change
Balance at
30 June 2016
(i)
‐
10
10
‐
‐
‐
20
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
10
10
‐
‐
‐
20
(i)
(ii)
(iii)
Balance at the end of the financial year or at date of retirement, for Directors who retired before financial
year end.
Balance at the beginning of the financial year or at date of appointment, for those Directors who were
appointed during the financial year.
On 5 September 2016, the Class B Performance Shares were converted into fully paid ordinary shares of
the Company upon vesting. Each Class B Performance Share converted into 100,000 ordinary shares in
the Company.
Other Equity‐related Key Management Personnel Transactions
There have been no other transactions involving equity instruments apart from those described in the tables above
relating to options and shareholdings.
Other Transactions with Key Management Personnel and/or their Related Parties
There were no other transactions conducted between the Group and Key Management Personnel or their related
parties, apart from those disclosed above relating to equity and compensation, that were conducted other than
in accordance with normal employee, customer or supplier relationships on terms no more favourable than those
reasonably expected under arm’s length dealings with unrelated persons.
END OF REMUNERATION REPORT
Cardinal Resources Limited – Annual Report 2016
P 23
DIRECTORS’ REPORT
INDEMNIFICATION AND INSURANCE OF DIRECTORS AND OFFICERS
In accordance with the constitution, except as may be prohibited by the Corporations Act 2001, every Officer or
agent of the Company shall be indemnified out of the property of the entity against any liability incurred by him
in his capacity as Officer or agent of the Company or any related corporation in respect of any act or omission
whatsoever and howsoever occurring or in defending any proceedings, whether civil or criminal.
During the year the Company agreed to pay an annual insurance premium of $11,328 (2015: $11,330) in respect
of directors’ and officers’ liability and legal expenses’ insurance contracts, for directors, officers and employees of
the Company. The insurance premium relates to:
Costs and expenses incurred by the relevant officers in defending proceedings, whether civil or criminal and
whatever the outcome.
Other liabilities that may arise from their position, with the exception of conduct involving a willful breach of
duty.
SHARES OPTIONS
Unissued shares
At the date of this report the Company had on issue 116,487,039 Listed Options in the Company, exercisable at
$0.15 on or before 30 September 2019. During the financial year none of these listed options were converted into
fully paid shares.
As at the date of this report the Company had on issue 9,500,000 unlisted options, exercisable at $0.22 on or
before 18 March 2020. During the financial year none of these unlisted options were converted into fully paid
shares.
Option holders do not have any rights to participate in any issues of shares of other interests in the Company or
any other entity.
There have been no options granted over unissued shares or interests of any controlled entity within the Group
during or since the end of the reporting period.
For details of options issued to directors and executives, refer to the remuneration report.
CORPORATE GOVERNANCE STATEMENT
Cardinal Resources is committed to ensuring that its policies and practices reflect a high standard of corporate
governance. The Board has adopted a comprehensive framework of Corporate Governance Guidelines.
Throughout the 2016 financial year the Company’s governance was consistent with the Corporate Governance
Principles and Recommendations (3rd edition) published by the ASX Corporate Governance Council.
The Group’s Corporate Governance Statement can be viewed at the Company’s Corporate Governance page at
http://cardinalresources.com.au.
EVENTS SUBSEQUENT TO BALANCE DATE
On 19 July 2016 the Company announced that is completed a placement to sophisticated investors. 75,000,000
fully paid ordinary shares were issued at $0.29 per share. 55,518,670 Fully paid ordinary shares were issued on 19
July 2016 and 19,481,330 were issued on 26 August 2016 after Shareholder approval was obtained at the General
Meeting held on 19 August 2016.
Cardinal Resources Limited – Annual Report 2016
P 24
DIRECTORS’ REPORT
On 26 August 2016, 5 September 2016 and 22 September 2016 500,000, 575,000 and 25,000 Listed Options were
exercised, respectively.
On 5 September 2016 50 Class B Performance Shares were converted into 5,000,000 fully paid ordinary shares of
the Company. The Class B Performance Shares converted to 5,000,000 fully paid ordinary shares when the
Company satisfied the requirement that the market capitalization of the Company reached at least $50 million on
an undiluted basis, determined by reference to the preceding 30 day VWAP.
Other than the above, no matters or circumstances have arisen since the end of the financial year which
significantly affected or could significantly affect the operations of the Group, the results of those operations, or
the state of the affairs of the Group in future financial years.
AUDITOR’S INDEPENDENCE DECLARATION
The auditor’s independence declaration for the year ended 30 June 2016 has been received and can be found on
page 52 of the financial report.
Non Audit Services
The Company’s auditor, Greenwich & Co Audit Pty Ltd, did not provide any non‐audit services to the Company
during the financial year ended 30 June 2016.
Signed in accordance with a resolution of the directors made pursuant to s 298(2) of the Corporations Act 2001.
On behalf of the directors
ARCHIE KOIMTSIDIS
Managing Director
Dated this 30 September 2016
Cardinal Resources Limited – Annual Report 2016
P 25
FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2016
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2016
Australian Dollar ($)
REVENUE
EXPENDITURE
Administration expenses
Depreciation expenses
Exploration expenses
Impairment expense
Foreign exchange gain
LOSS BEFORE INCOME TAX
Income tax
LOSS AFTER INCOME TAX
Note
30 JUNE 2016
$
30 JUNE 2015
$
3
4
11
10
5(a)
43,706
5,269
(2,090,910)
(94,932)
(7,182,584)
‐
2,347
(9,322,373)
‐
(9,322,373)
(616,772)
(69,778)
(2,143,615)
(781,903)
111,073
(3,495,726)
‐
(3,495,726)
OTHER COMPREHENSIVE INCOME
Items that me be reclassified to profit or loss:
Exchange differences arising on translation of
foreign operations
TOTAL COMPREHENSIVE INCOME
TOTAL COMPREHENSIVE INCOME
ATTRIBUTABLE TO MEMBERS OF THE
COMPANY
LOSS PER SHARE
Basic and diluted – cents per share
14(b)
78,464
(9,243,909)
(84,825)
(3,580,551)
(9,243,909)
(3,580,551)
16
(5.55)
(3.82)
The above consolidated statement of profit or loss and other comprehensive
income should be read in conjunction with the accompanying notes
Cardinal Resources Limited – Annual Report 2016
P 26
FINANCIAL REPORT AS AT 30 JUNE 2016
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2016
Australian Dollar ($)
CURRENT ASSETS
Cash and cash equivalents
Trade and other receivables
Other assets
TOTAL CURRENT ASSETS
NON CURRENT ASSETS
Plant and equipment
TOTAL NON CURRENT ASSETS
TOTAL ASSETS
CURRENT LIABILITIES
Trade and other payables
TOTAL CURRENT LIABILITIES
TOTAL LIABILITIES
NET ASSETS
EQUITY
Issued capital
Reserves
Accumulated losses
TOTAL EQUITY
Note
17(a)
8(a)
8(b)
11
12
13
14
15
30 JUNE 2016
$
30 JUNE 2015
$
4,864,822
16,280
104,523
4,985,625
675,911
675,911
5,661,536
1,713,467
1,713,467
1,713,467
3,948,069
839,755
12,878
22,474
875,107
476,644
476,644
1,351,751
368,148
368,148
368,148
983,603
26,151,217
1,043,600
(23,246,748)
3,948,069
14,816,842
354,952
(14,188,191)
983,603
The above consolidated statement of financial position should be
read in conjunction with the accompanying notes
Cardinal Resources Limited – Annual Report 2016
P 27
FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2016
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2016
Australian ($)
SHARE CAPITAL
OPTIONS RESERVE
BALANCE AT 1 JULY 2015
Total comprehensive income
Share and options issued during the year
Share issue expenses
Option based payments
Expiry of options
BALANCE AT 30 JUNE 2016
BALANCE AT 1 JULY 2014
Total comprehensive income
Share and options issued during the year
Share issue expenses
BALANCE AT 30 JUNE 2015
$
14,816,842
‐
12,042,719
(708,344)
‐
‐
26,151,217
12,871,486
‐
2,091,975
(146,619)
14,816,842
$
732,423
‐
‐
‐
874,000
(263,816)
1,342,607
263,816
‐
481,183
(12,576)
732,423
FOREIGN EXCHANGE
RESERVE
$
(377,471)
78,464
‐
‐
‐
‐
(299,007)
(292,646)
(84,825)
‐
‐
(377,471)
ACCUMULATED
LOSSES
$
(14,188,191)
(9,322,373)
‐
‐
‐
263,816
(23,246,748)
(10,692,465)
(3,495,726)
‐
‐
(14,188,191)
TOTAL EQUITY
$
983,603
(9,243,909)
12,042,719
(708,344)
874,000
‐
3,948,069
2,150,191
(3,580,551)
2,573,158
(159,195)
983,603
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes
Cardinal Resources Limited – Annual Report 2016
P 28
FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2016
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2016
Australian Dollar ($)
CASH FLOWS FROM OPERATING ACTIVITIES
Expenditure on mineral interests
Other payments to suppliers and employees
Interest received
Net cash outflow from operating activities
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of plant and equipment
Net cash outflow from investing activities
CASH FLOW FROM FINANCING ACTIVITIES
Issue of shares and options net of capital raising costs
Net cash flows from financing activities
Net increase/(decrease) in cash and cash equivalents
Cash and cash equivalents at the beginning of the
financial year
Exchange rate adjustment
Note
30 JUNE 2016
$
30 JUNE 2015
$
17(b)
(5,868,440)
(1,295,294)
30,325
(7,133,409)
(155,471)
(155,471)
11,334,374
11,334,374
4,045,494
839,755
(20,427)
(1,962,385)
(564,600)
5,269
(2,521,716)
(50,465)
(50,465)
2,413,963
2,413,963
(158,218)
909,980
87,993
CASH AND CASH EQUIVALENTS AT THE END OF THE
FINANCIAL YEAR
17(a)
4,864,822
839,755
The above consolidated statement of cash flows should be
read in conjunction with the accompanying notes
Cardinal Resources Limited – Annual Report 2016
P 29
FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2016
1
CORPORATE INFORMATION
The financial report of Cardinal Resources Limited (”Cardinal Resources” or “the Company”) and its controlled
entities (“the Group”) for the year ended 30 June 2016 was authorised for issue in accordance with a resolution
of the directors on 30 September 2016.
Cardinal Resources Limited is a company limited by shares, incorporated in Australia whose shares are publicly
traded on the Australian Securities Exchange. The consolidated financial statements of the Company for the year
ended 30 June 2016 comprise of the Company and its subsidiaries together referred to as the Group or
consolidated entity.
The nature of the operations and principal activity of the Group is described in the directors’ report.
2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a)
Basis of Preparation of the Financial Report
The financial report is a general purpose financial report, which has been prepared in accordance with the
requirements of the Corporations Act 2001, Accounting Standards and Interpretations and complies with other
requirements of the law. The financial report also complies with the International Financial Reporting Standards.
The financial report has also been prepared on a historical cost basis.
The financial report is presented in Australian dollars. The following accounting policies have been adopted by
the consolidated entity.
(b)
Principles of Consolidation
The consolidated financial statements incorporate assets, liabilities and results of entities controlled by Cardinal
Resources Limited at the end of the reporting period. A controlled entity is any entity over which Cardinal
Resources has the power to govern the financial and operating policies so as to obtain the benefits from the
entity’s activities. Control will generally exist when the parent owns, directly or indirectly through subsidiaries,
more than half of the voting power of an entity. In assessing the power to govern, the existence and effect of
holdings of actual and potential voting rights are also considered.
When controlled entities have entered or left the Group during the year, the financial performance of those
entities are included only for the period of year that they were controlled. A list of controlled entities is contained
in note 24 to the financial statements.
In preparing the consolidated financial statements, all inter‐group balances and transactions between entities in
the consolidated group have been eliminated on consolidation. Accounting policies of subsidiaries have been
changed where necessary to ensure consistency with those adopted by the parent entity.
Non‐controlling interests, being the equity in a subsidiary not attributable, directly or indirectly, to a parent, are
shown separately within the equity section of the consolidated Statement of Financial Position and Statement
of Profit or Loss and Other Comprehensive Income. The non‐controlling interests in the net assets comprise their
interests at the date of the original business combination and their share of changes in equity since that date.
Cardinal Resources Limited – Annual Report 2016
P 30
FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2016
(c)
Adoption of new and revised standards
There are a number of new Accounting Standards and Interpretations issued by the AASB that are not yet
mandatorily applicable to the Group and have not been applied in preparing these consolidated financial
statements. The Group does not plan to adopt these standards early.
These standards are not expected to have a material impact on the Group in the current or future reporting
periods.
(d)
Statement of compliance
The financial report complies with Australian Accounting Standards. Compliance with Australian Accounting
Standards ensures that the financial report, comprising the financial statements and notes thereto, complies
with International Financial Reporting Standards (“IFRS”).
(e)
Income Tax
Current income tax refunded/(expensed) charged to profit or loss is tax refundable/(payable). Those amounts
recognised are expected to be recovered from/(paid to) the relevant taxation authority.
Deferred income tax is provided on all temporary differences at the balance sheet date between the tax bases
of assets and liabilities and their carrying amounts for financial reporting purposes.
Deferred income tax liabilities are recognised for all taxable temporary differences:
except where the deferred income tax liability arises from the initial recognition of an asset or liability
in a transaction that is not a business combination and, at the time of the transaction, affects neither
that accounting profit nor taxable profit or loss; and
in respect of taxable temporary differences associated with investments in subsidiaries, associates and
interests in joint ventures, except where the timing of the reversal of the temporary differences will not
reverse in the foreseeable future.
Deferred income tax assets are recognised for all the deductible temporary differences, carry‐forward of unused
tax assets and unused tax losses, to the extent that it is probable that taxable profit will be available against
which the deductible temporary differences, and the carry‐forward of unused tax assets and unused tax losses
can be utilised:
except where the deferred income tax asset relating to the deductible temporary difference arises from
the initial recognition of an asset or liability in a transaction that is not a business combination and, at
the time of the transaction, affects neither the accounting profit nor taxable profit or loss; and
in respect of deductible temporary differences with investments in subsidiaries, associates and interest
in joint ventures, deferred tax assets in the foreseeable future and taxable profit will be available against
which the temporary differences can be utilised.
The carrying amount of deferred income tax is reviewed at each balance sheet date and reduced to the extent
that is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred income
tax asset to be utilised.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year
when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or
substantively enacted at the balance sheet date.
Income taxes relating to items recognised directly in equity are not in the income statement.
Cardinal Resources Limited – Annual Report 2016
P 31
FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2016
(f)
Exploration and evaluation expenditure
The Group expenses all exploration and evaluation expenditure on areas of interest as incurred.
(g)
Revenue
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the
revenue can be reliably measured. Interest revenue is recognised using the effective interest method.
(h)
Cash and cash equivalents
Cash and short‐term deposits in the consolidated Statement of Financial Position comprise cash at bank and in
hand and short‐term deposits with an original maturity of three months or less.
For the purposes of the consolidated Statement of Cash Flows, cash and cash equivalents consist of cash and
cash equivalents as defined above, net of outstanding bank overdrafts.
(i)
Employee benefits
Provision is made for the Group’s liability for employee benefits arising from services rendered by employees to
balance date. Employee benefits expected to be settled within one year together with entitlements arising from
wages and salaries and annual leave which will be settled after one year, have measured at the amounts
expected to be paid when the liability is settled, plus related on‐costs. Other employee benefits payable later
than one year have been measured at the present value of the estimated cash outflows to be made to those
benefits.
Contributions are made by the Group to employee superannuation funds and are charged as expenses when
incurred.
(j)
Impairment of assets
The consolidated group assesses impairment at the end of each reporting period by evaluating conditions and
events specific to the consolidated group that may be indicative of impairment triggers. Recoverable amounts
of relevant assets are reassessed using fair value less cost to sell. In such cases the asset is tested for impairment
as part of the cash‐generating unit to which it belongs. When the carrying amount of an asset or cash‐generating
unit exceeds its recoverable amount, the asset or cash‐generating unit is considered impaired and it is written
down to its recoverable amount.
In assessing the value in use, the estimated future cash flows are discounted to their present value using a pre‐
tax discount rate that reflects current market assessments of the time value of money and the risks specific to
the asset. Impairment losses relating to continuing operations are recognised in those expense categories
consistent with the function of the impaired asset unless the asset is carried at revalued amount (in which case
the impairment loss is treated as a revaluation decrease).
An assessment is also made at each reporting date as to whether there is any indication that previously
recognised impairment losses may no longer exist or may have decreased. If such indication exists, the
recoverable amount is estimated. A previously recognised impairment loss is reversed only if there has been a
change in the estimates used to determine the asset’s recoverable amount since the last impairment loss was
recognised. If that is the case the carrying amount of the asset is increased to its recoverable amount. That
increased amount cannot exceed the carrying amount that would have been determined, net of depreciation,
had no impairment loss been recognised for the asset in prior years. Such reversal is recognised in profit or loss
unless the asset is carried at revalued amount, in which case the reversal is treated as a revaluation increase.
Cardinal Resources Limited – Annual Report 2016
P 32
FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2016
After such a reversal the depreciation charge is adjusted in future periods to allocate the asset’s revised carrying
amount, less any residual value, on a systemic basis over its remaining useful life.
(k)
Earnings per share
Basic earnings per share is calculated as net loss attributable to members of the Company, adjusted to exclude
any costs of servicing equity (other than dividends) and preference share dividends, divided by the weighted
average number of ordinary shares, adjusted for any bonus element.
(l)
Goods and services tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST
incurred is not recoverable from the Australian Taxation Office (“ATO”). In these circumstances the GST is
recognised as part of the cost of acquisition of the asset or as part of an item of the expense. Receivables and
payables in the consolidated Statement of Financial Position are shown inclusive of GST.
The net amount of GST recoverable from, or payable to, the ATO is included as a current asset or liability in the
Consolidated Statement of Financial Position.
Cash Flows are included in the Consolidated Statement of Cash Flows on a net basis. The GST components of
cash flows arising from investing and financial activities which are recoverable from, or payable to, the ATO are
classified as operating cash flows.
(m)
Investments
All investments are initially recognised at cost, being the fair value of the consideration given and including
acquisition charges associated with the investment.
After initial recognition, investments, which are classified as held for trading and available‐for‐sale, are measured
at fair value. Gains or losses on investments held for trading are recognised in the consolidated profit or loss.
Gains or losses on available‐for‐sale investments are recognised as a separate component of equity until the
investment is sold, collected or otherwise disposed of, or until the investment is determined to be impaired, at
which time the cumulative gain or loss previously reported in equity is included in the profit or loss.
(n)
Contributed equity
Ordinary shares and options are classified as contributed 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.
(o)
Significant accounting estimates and judgements
The carrying amount of certain assets and liabilities are often determined based on estimates and assumptions
of future events. The key estimates and assumptions that have a significant risk of causing a material adjustment
to the carrying amounts of certain assets and liabilities within the next annual reporting period are:
Cardinal Resources Limited – Annual Report 2016
P 33
FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2016
Deferred taxation
The potential deferred tax asset arising from the tax losses and temporary differences have not been recognised
as an asset because recovery of the tax losses is not yet considered probable (refer note 5).
Subsidiary Loans
Provision has been made for all unsecured loans with subsidiaries as it is uncertain if and when the loans will be
recovered.
Share‐based payment transactions
The Group measures the cost of equity‐settled transactions by reference to the fair value of the equity
instrument at the date at which they are granted. The fair value of options granted is measured using the Black‐
Scholes option pricing model. The model uses assumptions and estimates as inputs.
Impairment
The consolidated group assesses impairment at the end of each reporting period by evaluating conditions and
events specific to the consolidated group that may be indicative of impairment triggers. Recoverable amounts
of relevant assets are reassessed using various key assumptions.
(p)
Comparative information
Comparative information is amended where appropriate to ensure consistency in presentation with the
current year.
3
REVENUE
Other income
Interest from financial institutions
Refunds
Insurance proceeds
4
EXPENSES
Administration expenses include the following expenses:
Salary, fees and leave
Eligible termination payment
Equity Based Payments
Defined contribution superannuation expense
CONSOLIDATED
30 JUNE 2016
$
CONSOLIDATED
30 JUNE 2015
$
30,325
10,881
2,500
43,706
5,269
‐
‐
5,269
CONSOLIDATED
30 JUNE 2016
$
CONSOLIDATED
30 JUNE 2016
$
180,284
‐
874,000
12,538
81,000
20,000
‐
4,275
Cardinal Resources Limited – Annual Report 2016
P 34
FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2016
5
INCOME TAX
(a)
Prima facie income tax benefit at 30% on loss from ordinary activities is reconciled to the income tax
provided in the financial statements
Loss before income tax
Income tax calculated at 30%
CONSOLIDATED
30 JUNE 2016
$
(9,322,373)
(2,796,712)
CONSOLIDATED
30 JUNE 2015
$
(3,495,726)
(1,048,718)
Tax effect of;‐
Expenses not allowed
Sundry – temporary differences
Section 40‐880 deduction
Future income tax benefit not brought to account
Income tax refund (payable) attributable to operating
losses
‐
(186,054)
(110,229)
3,092,995
‐
16
477,812
(67,729)
638,619
‐
(b)
Deferred tax assets
The potential deferred tax asset arising from the tax losses and temporary differences have not been recognised
as an asset because recovery of tax losses is not yet probable.
The benefits will only be obtained if:
(i)
(ii)
(iii)
The Group 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;
The Group continues to comply with the conditions in deductibility imposed by the Law; and
No change in tax legislation adversely affect the Group in realising the benefits from the deductions or
the losses.
6
AUDITOR’S REMUNERATION
Auditing and review of the Company’s financial statements
7
(a)
KEY MANAGEMENT PERSONNEL
Details of key management personnel
CONSOLIDATED
30 JUNE 2016
$
24,500
24,500
CONSOLIDATED
30 JUNE 2015
$
24,000
24,000
Directors and Executives
Mark Connelly – Non‐Executive Chairman – appointed on 19 November 2015
Archie Koimtsidis – Managing Director
Malik Easah – Executive Director
Mark Thomas – Non‐Executive Director – appointed 31 August 2015
Simon Jackson – Non‐Executive Director – appointed 31 August 2015
Alec Pismiris – Non‐Executive Chairman – retired on 19 November 2015
Cardinal Resources Limited – Annual Report 2016
P 35
FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2016
(b)
Compensation of key management personnel
Salaries, fees and leave
Eligible termination payment
Non monetary
Post employment benefits – superannuation
Equity based payments – Note 18
CONSOLIDATED
30 JUNE 2016
$
CONSOLIDATED
30 JUNE 2015
$
540,471
‐
11,328
12,537
782,000
1,346,336
266,000
20,000
11,330
4,275
‐
301,605
Refer to the remuneration report contained in the directors report for details of the remuneration paid/payable
and share and options holdings in relation to each of Group’s key management personnel for the year ended 30
June 2016.
8
CURRENT ASSETS
(a)
Trade and Other Receivables
Government taxes receivables
CONSOLIDATED
30 JUNE 2016
$
16,280
16,280
CONSOLIDATED
30 JUNE 2015
$
12,878
12,878
GST and income tax amounts are non‐interest bearing and have repayment terms applicable under the relevant
government authorities. No trade and other receivables are impaired or past due.
(b)
Other Assets
Prepayments
Cash deposits
9
CAPITALISED EXPLORATION AND EVALUATION
Balance at the beginning of the year
Impairment (Note 10)
Foreign exchange movement
Balance at end of year (i)
CONSOLIDATED
30 JUNE 2016
$
77,553
26,970
104,523
CONSOLIDATED
30 JUNE 2016
$
‐
‐
‐
‐
CONSOLIDATED
30 JUNE 2015
$
13,882
8,592
22,474
CONSOLIDATED
30 JUNE 2015
$
771,450
(781,903)
10,453
‐
(i)
The Recoupment of costs carried forwarded in relation to areas of interest in the exploration and
evaluation phases is dependent on the successful development and commercial exploitation on the sale
of the respective area.
Cardinal Resources Limited – Annual Report 2016
P 36
FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2016
10
IMPAIRMENT EXPENSE
Impairment expense (i)
CONSOLIDATED
30 JUNE 2016
$
‐
‐
CONSOLIDATED
30 JUNE 2015
$
781,903
781,903
(i)
In light of the current market conditions, the Directors’ have conservatively impaired its capitalised
deferred exploration and evaluation expenditure by $781,903 as at 30 June 2015. As this is an
estimation, the actual recoverable amount may be significantly different to this value. Future
exploration and evaluation results and changes in commodity prices may increase the estimated
recoverable amount in the future, which may result in the reversal of some or all of impairment
recognised.
11
PLANT AND EQUIPMENT
Plant and Equipment
Carrying amount at the beginning of the year
Additions
Disposals
Depreciation expense
Foreign exchange movement
Total plant and equipment
Plant and equipment
At cost
Less: accumulated depreciation
Total plant and equipment
12
TRADE AND OTHER PAYABLES
Trade and other payables
Other accrued expenses
CONSOLIDATED
30 JUNE 2016
$
CONSOLIDATED
30 JUNE 2015
$
476,644
215,521
(11,592)
(94,932)
90,270
675,911
556,636
50,465
‐
(69,778)
(60,679)
476,644
CONSOLIDATED
30 JUNE 2016
$
CONSOLIDATED
30 JUNE 2015
$
977,014
(301,103)
675,911
666,623
(189,979)
476,644
CONSOLIDATED
30 JUNE 2016
$
1,581,718
131,749
1,713,467
CONSOLIDATED
30 JUNE 2015
$
331,107
37,041
368,148
Cardinal Resources Limited – Annual Report 2016
P 37
FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2016
13
ISSUED CAPITAL
Movement in ordinary shares on issue
As 1 July 2014
Transactions during the year
Shares issued (ii)
Less: transaction costs (iii)
At 30 June 2015
As 1 July 2015
Transactions during the year
Shares issued (i)
Less: transaction costs (iii)
At 30 June 2016
NUMBER OF
SHARES
73,356,576
37,464,231
‐
110,820,807
110,820,807
111,253,890
‐
222,074,697
$
12,871,486
2,091,975
(146,619)
14,816,842
14,816,842
12,042,719
(708,344)
26,151,217
(i)
The following shares were issued during the financial year ended 30 June 2016
On 7 August 2015 1,838,462 shares, together with one (1) free attaching option for everyone one
(1) share subscribed for, were issued at $0.065 per share to the directors’ of the Company. The
directors’ participation was approved at the General Meeting held on 27 July 2015;
On 25 September 2015 28,164,816 shares, together with one (1) free attaching option for two (2)
shares subscribed for, were issued at $0.10 per shares pursuant to a placement to sophisticated
investors;
On 27 November 2015 24,050,184 shares, together with one (1) free attaching option for two (2)
shares subscribed for, were issued at $0.10 per shares pursuant to a placement to sophisticated
investors.
On 27 November 2015 8,117,116 shares, together with one (1) free attaching option for two (2)
shares subscribed for, were issued at $0.10 per share to the directors’ of the Company. The
directors’ participation was approved at the Annual General Meeting held on 19 November 2015;
On 8 March 2016 42,666,642 shares were issued at $0.12 per shares pursuant to a placement to
sophisticated investors;
On 9 May 2016 4,666,668 shares were issued at $0.12 per shares pursuant to a placement to
sophisticated investors; and
On 9 May 2016 1,750,002 shares were issued at $0.12 per share to the directors’ of the Company.
The directors’ participation was approved at a General Meeting held on 17 February 2016.
(ii)
The following shares were issued during the financial year ended 30 June 2015
On 18 September 2014 18,000,000 shares, together with one (1) free attaching option for everyone
one (1) share subscribed for, were issued at $0.05 per share pursuant to a placement to
sophisticated investors;
On 10 November 2014 4,880,000 shares, together with one (1) free attaching option for everyone
one (1) share subscribed for, were issued at $0.05 per shares to the directors’ of the Company. The
directors’ participation was approved at the Annual General Meeting held on 3 November 2014;
On 5 June 2015 14,584,231 shares, together with one (1) free attaching option for everyone one
(1) share subscribed for, were issued at $0.065 per share pursuant to a placement to sophisticated
investors;
(iii) Transactions costs represent the costs of issuing the shares.
Cardinal Resources Limited – Annual Report 2016
P 38
FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2016
14
RESERVES
(a) Movements in options reserve
At the beginning of the year
Options issued during the year
Expiry of unlisted options (i)
At reporting date
CONSOLIDATED
30 JUNE 2016
$
732,423
874,000
(263,816)
1,342,607
CONSOLIDATED
30 JUNE 2015
$
263,816
468,607
‐
732,423
(i)
On 11 January 2016 11,000,000 options expired. None of these options were exercised.
Movement in options exercisable at $0.15 on or before 30 September 2019
As 1 July 2014
Transactions during the year
Options issued (ii)
Exercise of Options
Less: transaction costs (iii)
At 30 June 2015
As 1 July 2015
Transactions during the year
Options issued (i)
At 30 June 2016
NUMBER OF
OPTIONS
‐
70,998,288
‐
‐
70,998,288
70,998,288
46,588,751
117,587,039
$
‐
481,183
‐
(12,576)
468,607
468,607
‐
468,607
(i)
The following options were issued during the financial year ended 30 June 2016
On 7 August 2015 1,838,462 shares, together with one (1) free attaching option for everyone one
(1) share subscribed for, were issued at $0.065 per share to the directors’ of the Company. The
directors’ participation was approved at the General Meeting held on 27 July 2015;
On 25 September 2015 28,164,816 shares, together with one (1) free attaching option for two (2)
shares subscribed for, were issued at $0.10 per shares pursuant to a placement to sophisticated
investors (“September 2015 placement”); and
On 27 November 2015 32,167,300 shares and 30,166,058 options were issued on the same terms
as the September 2015 placement.
(ii)
The following options were issued during the financial year ended 30 June 2015
On 24 September 2014 the Company issued an Options Entitlement Prospectus that offered
shareholders one (1) option for every two (2) shares held on 1 October 2014 at an issue price of $0.01
per option. A total of 48,118,288 options were issued under the Prospectus.
On 18 September 2014 18,000,000 shares, together with one (1) free attaching option for everyone one
(1) share subscribed for, were issued at $0.05 per share pursuant to a placement to sophisticated
investors;
On 10 November 2014 4,880,000 shares, together with one (1) free attaching option for everyone one
(1) share subscribed for, were issued at $0.05 per shares to the directors’ of the Company. The directors’
participation was approved at the Annual General Meeting held on 3 November 2014.
Cardinal Resources Limited – Annual Report 2016
P 39
FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2016
(iii)
Transactions costs represent the costs of issuing the options.
Movement in unlisted options exercisable at $0.22 on or before 18 March 2020
As 1 July 2015
Transactions during the year
Options issued (i)
At 30 June 2016
NUMBER OF
OPTIONS
‐
9,500,000
9,500,000
$
‐
874,000
874,000
(i)
On 18 March 2016 the Company issued 9,500,000 unlisted options to employees and directors of the
Company – Refer to Note 18 for details.
Movement in unlisted options exercisable at $0.20 on or before 31 December 2015
As 1 July 2014
Transactions during the year
Options issued
At 30 June 2015
As 1 July 2015
Transactions during the year
Options issued
Expired during the year
At 30 June 2016
Movement in Performance Shares
As 1 July 2014
Transactions during the year
Performance shares issued
At 30 June 2015
As 1 July 2015
Transactions during the year
Performance shares issued
At 30 June 2016
NUMBER OF
OPTIONS
11,000,000
‐
11,000,000
11,000,000
‐
(11,000,000)
‐
NUMBER OF
CLASS A
PERFORMANCE
SHARES (i)
50
‐
50
50
‐
50
$
10,000
‐
10,000
10,000
‐
(10,000)
‐
$
‐
‐
‐
‐
‐
‐
Cardinal Resources Limited – Annual Report 2016
P 40
FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2016
As 1 July 2014
Transactions during the year
Performance shares issued
At 30 June 2015
As 1 July 2015
Transactions during the year
Performance shares issued
At 30 June 2016
NUMBER OF
CLASS B
PERFORMANCE
SHARES (i)
$
50
‐
50
50
‐
50
‐
‐
‐
‐
‐
‐
General terms attaching to the Performance Shares are set out below.
Class A Performance Shares
(a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)
(i)
Performance Shares: Each Class A Performance Share is a share in the capital of the Company.
Class A Performance Shares shall confer on the holder (Holder) the right to receive notices of general
meetings and financial reports and accounts of the Company that are circulated to shareholders. Holders
have the right to attend general meetings of shareholders of the Company.
The Class A Performance Shares do not entitle the Holder to vote on any resolutions proposed at a general
meeting of shareholders of the Company.
The Class A Performance Shares do not entitle the Holder to any dividends.
The Class A Performance Shares are not transferable.
If at any time the issue capital of the Company is reconstructured, all rights of a Holder will be changed to
the extent necessary to comply with the applicable Listing Rules at the time of reorganisation.
The Class A Performance Shares will not be quoted on ASX. However, upon conversion of the Class A
Performance Shares into Shares, the Company must within seven (7) days after the conversion, apply for
the official quotation of the Shares arising from the conversion on ASX.
The Class A Performance Shares give the Holders no rights other than those expressly provided by these
terms and those provided at law where such rights at law cannot be required by ASX.
The Shares into which the Class A Performance Shares will convert will rank pari passu in all respects with
the other Shares on issue.
Conversion of the Class A Performance Shares
(j)
Each Class A Performance Share will convert into 100,000 Shares upon satisfaction of one of the following
performance hurdles to the reasonable satisfaction of the Company by no later than 5 years from the 28
December 2012:
(i)
The establishment of an inferred resources (JORC compliant) of at least 1 million ounces of gold
within the tenements owned by the Company or any of its subsidiaries comprised buy the
Ghanaian Projects and DRC Projects;
Cardinal Resources Limited – Annual Report 2016
P 41
FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2016
(ii)
(iii)
A project owned by the Company or any of its subsidiaries being comprised by the tenements the
subject of all or part of the Ghanaian Projects or DRC Projects, being sold for at least $25 million
in cash or cash equivalent; or
A joint venture arrangement being entered into in respect of any tenement or tenements owned
by the Company or of any of its subsidiaries and being comprised by all or part of the Ghanaian
Projects or DRC Projects resulting in a payment in cash or cash equivalent of the Company or not
less than $25 million.
(with all of the above performance hurdles constituting the “Class A Performance Hurdle)
(k)
The Company will issue the Holder with new holding statements for the Shares as soon as practicable
following the conversion of the Class A Performance Shares into Shares.
The Directors are currently of the opinion that the vesting conditions are unlikely to be met within 5 years from
Completion date. As such, no value as been ascribed to the Class A performance shares in the Group’s financial
statements.
Class B Performance Shares
(a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)
(i)
Performance Shares: Each Class B Performance Share is a share in the capital of the Company.
Class B Performance Shares shall confer on the holder (Holder) the right to receive notices of general
meetings and financial reports and accounts of the Company that are circulated to shareholders. Holders
have the right to attend general meetings of shareholders of the Company.
The Class B Performance Shares do not entitle the Holder to vote on any resolutions proposed at a general
meeting of shareholders of the Company.
The Class B Performance Shares do not entitle the Holder to any dividends.
The Class B Performance Shares are not transferable.
If at any time the issue capital of the Company is reconstructured, all rights of a Holder will be changed to
the extent necessary to comply with the applicable Listing Rules at the time of reorganisation.
The Class B Performance Shares will not be quoted on ASX. However, upon conversion of the Class B
Performance Shares into Shares, the Company must within seven (7) days after the conversion, apply for
the official quotation of the Shares arising from the conversion on ASX.
The Class B Performance Shares give the Holders no rights other than those expressly provided by these
terms and those provided at law where such rights at law cannot be required by ASX.
The Shares into which the Class B Performance Shares will convert will rank pari passu in all respects with
the other Shares on issue.
Conversion of the Class B Performance Shares
(j) As outlined at Note 20, on 5 September 2016 50 Class B Performance Shares were converted into
5,000,000 fully paid ordinary shares of the Company. The Class B Performance Shares converted to
5,000,000 fully paid ordinary shares when the Company satisfied the requirement that the market
capitalization of the Company reached at least $50 million on an undiluted basis, determined by reference
to the preceding 30 day VWAP.
Cardinal Resources Limited – Annual Report 2016
P 42
FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2016
Class C Performance Shares
As 1 July 2014
Transactions during the year
Performance shares issued
At 30 June 2015
As 1 July 2015
Transactions during the year
Performance shares issued
At 30 June 2016
NUMBER OF
CLASS C
PERFORMANCE
SHARES (ii)
$
‐
60
60
60
‐
60
‐
‐
‐
‐
‐
‐
(ii)
The following Class C performance shares were issued during the financial year ended 30 June 2015
On 17 February 2015, 60 performance shares were issued pursuant to the Asset Sale Agreement with Savannah
to purchase the highly prospective Ndongo North concession adjacent to the exiting Ndongo area within the
Bolgatanga project area in North‐East Ghana.
There are 60 Performance Shares (convertible into a maximum of 6,000,000 Shares) on issue at 30 June 2016.
General terms attaching to the Performance Shares are set out below.
The Directors are currently of the opinion that the non‐market vesting conditions are unlikely to be met within
5 years from the date issue. As such, no value as been ascribed to the performance shares in the group’s financial
statements.
The issue of 60 Performance Shares in the capital of the Company, each of which will convert to 100,000 Shares
ranking equally with the existing Shares in the proportions set out below upon satisfaction of achieving a
minimum JORC Inferred Resource of gold ounces within the Ndongo North Concession (“Performance Hurdles”)
by no later than five years after the date on which the Performance Shares are issued, being 18 February 2015;
Performance Shares
Performance Hurdles (JORC Inferred
Au Resource)
Conversion to Ordinary
Shares
10
5
5
5
5
5
5
5
5
5
5
60
500,000 ounces
750,000 ounces
1,000,000 ounces
1,250,000 ounces
1,500,000 ounces
1,750,000 ounces
2,000,000 ounces
2,250,000 ounces
2,500,000 ounces
2,750,000 ounces
3,000,000 ounces
1,000,000
500,000
500,000
500,000
500,000
500,000
500,000
500,000
500,000
500,000
500,000
6,000,000
In the event that the Company sells, transfers or otherwise disposes of all or part of the Ndongo North
Concession to a third party prior to the issuing of any Shares upon conversion of any Performance Shares,
Savannah will be entitled to an amount equal to 49% of the sale proceeds less any related selling costs,
Cardinal Resources Limited – Annual Report 2016
P 43
FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2016
exploration and mining costs (plus a fixed 30% overhead amount), purchase costs in connection with the
acquisition of the Ndongo North Concession, and any other costs incurred with respect to the sale.
(b) Movements in foreign translation reserve
At the beginning of the year
Foreign translation
15
ACCUMULATED LOSSES
Accumulated losses at the beginning of the year
Loss for the year
Expiry of unlisted options
Accumulated losses at the end of the year
16
LOSS PER SHARE
Loss attributable to the owners of the Company used in
calculating basic and diluted loss per shares
Weighted average number of shares on issue during the
financial year used in the calculation of basic earnings
per share
Weighted average number of ordinary shares for
diluted earnings per share
CONSOLIDATED
30 JUNE 2016
$
(377,471)
78,464
(299,007)
CONSOLIDATED
30 JUNE 2016
$
(14,188,191)
(9,322,373)
263,817
(23,246,747)
CONSOLIDATED
30 JUNE 2015
$
(292,646)
(84,825)
(377,471)
CONSOLIDATED
30 JUNE 2015
$
(10,692,465)
(3,495,726)
‐
(14,188,191)
CONSOLIDATED
30 JUNE 2016
$
CONSOLIDATED
30 JUNE 2015
$
(9,322,373)
(9,322,373)
2016
Number
(3,495,726)
(3,495,726)
2015
Number
167,886,217
91,614,740
167,886,217
91,614,740
As the Company has made a loss for the year ended 30 June 2016, all options on issue are considered anti‐
dilutive and have not been included in the calculation of diluted earnings per share. These options could
potentially dilute basic earnings per share in the future.
Cardinal Resources Limited – Annual Report 2016
P 44
FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2016
17
NOTES TO THE CONSOLIDATED STATEMENT OF CASH FLOWS
(a)
Reconciliation of cash and cash equivalents
For the purposes of the consolidated statement of cash flows, cash and cash equivalents consist of cash at bank
and in hand and short‐term deposits with an original maturity of three months or less, net of outstanding bank
overdrafts.
Current – cash at bank
CONSOLIDATED
30 JUNE 2016
$
4,864,822
4,864,822
CONSOLIDATED
30 JUNE 2015
$
839,755
839,755
(b)
Reconciliation of loss after tax to net cash flows from operations
Loss after income tax
Non‐cash flows in profit
Depreciation expense
Impairment expense
Share based payments
Foreign exchange movement
Changes in assets and liabilities
Decrease in trade and other receivables
(Increase)/Decrease in prepayments
Increase/(Decrease) in trade and other payables
CONSOLIDATED
30 JUNE 2015
$
(9,322,373)
CONSOLIDATED
30 JUNE 2015
$
(3,495,726)
94,932
‐
874,000
20,213
(3,402)
(82,049)
1,285,270
(7,133,409)
69,778
771,449
‐
(111,073)
13,292
(9,153)
239,717
(2,521,716)
18
(i)
SHARE BASED PAYMENTS
The Company agreed and approved at the Company’s General Meeting held on 17 February 2016 to
allot and issue a total of 9,500,000 Options employees of the Company. The terms and conditions of the
options are detailed in the Notice of General Meeting dated 1 January 2016.
Using the Black & Scholes option model and based on the assumption below, the Options were ascribed
the following value:
Class of
Options
Number
Options
Valuation
Date
Unlisted
Options
9,500,000 18.03.2016
Market
Price of
Shares
$0.15
Exercise
Price
Expiry Date Risk Free
Interest
Rate
1.95%
Volatility
(discount)
97.48%
Indicative
Value per
Option
$0.092
$0.22
18.03.2020
The Directors of the Company (being Key Management Personnal) were issued unlisted options, details below:
Director
Mark Connelly
Archie Koimstidis
Malik Easah
Mark Thomas
Simon Jackson
Number Options
1,000,000
3,000,000
2,000,000
1,500,000
1,000,000
Cardinal Resources Limited – Annual Report 2016
P 45
FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2016
19
(a)
COMMITMENTS AND CONTINGENCIES
Commitment
Mineral exploration commitment
In order to maintain the current rights of tenure to exploration tenements, the Group has the following
discretionary exploration expenditure requirements.
Not later than one year
Later than one year but not later than two years
(b)
Contingent liabilities and commitments
2016
$
‐
‐
‐
2015
$
‐
‐
‐
The Group fully owns five subsidiaries, the main activities of which are exploration. The effect of these
subsidiaries is to make the Cardinal Resources owned subsidiaries contractually responsible for any transactions
undertaken by the subsidiary. The parent entity has provided certain guarantees to third parties whereby certain
liabilities of the subsidiary are guaranteed.
Not later than one year
Later than one year but not later than two years
2016
$
404,373
1,145,724
1,550,097
2015
$
1,606,269
391,773
1,998,042
Subranum Project: Cardinal Resources Subranum Limited has entered into a Sale and Purchase agreement with
Newmont Ghana Gold Limited (a subsidiary of Newmont Mining Corporation) for the purchase of Subin Kasu
Prospecting Licence (the “Subranum Project”).
Subject to the approval of the sale by the relevant Minister for the Ghanaian Mining Act, Cardinal Resources
Subranum Limited will acquire 100% of the Subin Kasu Prospecting Licence and pay to Newmont Ghana Gold
Limited US$50,000 on or before 10 days after the approval date, paid on 12 June 2016, US$50,000 on the first
anniversay of the approval date and a final $100,000 on the second anniversary date. In addition Cardinal
Resources Subranum Limited will be required to spend US$250,000 on exploration within the first year from
approval and a further US$750,000 in the second year.
Cardinal Resources Subranum Limited will be required to pay Newmont Ghana Gold Limited US$50,000 per
annum from the date which Cardinal Resources Subranum Limited reports a “gold resource estimate” of 1 Moz
of Gold. Subject to the grant of a Mining Lease under the Ghanaian Mining Act, Cardinal Resources Subranum
Limited will be required to pay Newmont Ghana Gold Limited a 2% Net Smelter Royalty.
20
EVENTS SUBSEQUENT TO BALANCE DATE
On 19 July 2016 the Company announced that is completed a placement to sophisticated investors. 75,000,000
fully paid ordinary shares were issued at $0.29 per share. 55,518,670 Fully paid ordinary shares were issued on
19 July 2016 and 19,481,330 were issued on 26 August 2016 after Shareholder approval was obtained at the
General Meeting held on 19 August 2016.
On 26 August 2016, 5 September 2016 and 22 September 2016 500,000, 575,000 and 25,000 Listed Options
were exercised, respectively.
Cardinal Resources Limited – Annual Report 2016
P 46
FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2016
On 5 September 2016 50 Class B Performance Shares were converted into 5,000,000 fully paid ordinary shares
of the Company. The Class B Performance Shares converted to 5,000,000 fully paid ordinary shares when the
Company satisfied the requirement that the market capitalization of the Company reached at least $50 million
on an undiluted basis, determined by reference to the preceding 30 day VWAP.
Other than the above, no matters or circumstances have arisen since the end of the financial year which
significantly affected or could significantly affect the operations of the Group, the results of those operations, or
the state of the affairs of the Group in future financial years.
21
(a)
FINANCIAL INSTRUMENTS
Interest Rate Risk
The Group’s exposure to interest rate risk, which is the risk that the financial instrument’s value will fluctuate as
a result of changes in market interest rates and the effective weighted average interest rates on those financial
assets and financial liabilities, is as follows:
2016
Note
Floating
interest
rate
Fixed
interest
rate
Non‐
interest
bearing
Total
Weighted
average
interest rate
Financial assets
Cash and cash equivalents
Trade and other receivables
Cash deposits
Financial liabilities
Trade and other payables
2015
17 (a)
8 (a)
8 (b)
12
Note
Financial assets
Cash and cash equivalents
Trade and other receivables
Cash deposits
17 (a)
8 (a)
8 (b)
Financial liabilities
Trade and other payables
12
$
$
$
$
%
3,497,522
‐
‐
3,497,522
‐
‐
‐
‐
‐
‐
‐
‐
1,367,300
16,280
26,970
1,410,550
4,864,822
16,280
26,970
4,908,072
1,713,467
1,713,467
1,713,467
1,713,467
1.11%
‐
‐
‐
‐
‐
Floating
interest
rate
Fixed
interest
rate
Non‐
interest
bearing
Total
Weighted
average
interest rate
$
$
$
$
%
674,371
‐
‐
674,371
‐
‐
‐
‐
‐
‐
‐
‐
165,384
12,878
8,592
186,854
368,148
368,148
839,755
12,878
8,592
861,225
368,148
368,148
2.69%
‐
‐
‐
‐
‐
Based on the balances at 30 June 2016 a 1% movement in interest rates would increase/decrease the loss for
the year before taxation by $2,914 (2015: $884).
(b)
Credit Risk
The maximum exposure to credit risk, excluding the value of any collateral or other security, at balance date to
recognised financial assets is the carrying amount of those assets, net of any allowance for doubtful debts, as
disclosed in the statement of financial position and notes to the financial report.
Cardinal Resources Limited – Annual Report 2016
P 47
FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2016
The Group does not have any material credit risk exposure to any single debtor or group of debtors under
financial instruments entered into by the Group.
(c)
Net Fair Values
The carrying amount of financial assets and financial liabilities recorded in the financial statements represent
their respective net fair value and is determined in accordance with the accounting policies disclosed in note 2
to the financial statements.
(d)
Financial risk management
The Group’s financial instruments consist mainly of deposits with recognised banks, investment in bank bills up
to 90 days, accounts receivable and accounts payable. Liquidity is managed, when sufficient funds are available,
by holding sufficient funds in a current account to service current obligations and surplus funds invested in bank
bills. The directors analyse interest rate exposure and evaluate treasury management strategies in the context
of the most recent economic conditions and forecasts. The main risks the Group is exposed to is through its
financial instruments is the depository banking institution itself, holding the funds, and interest rates. The
Group's credit risk is minimal as being an exploration Company, it has no significant financial assets other than
cash and term deposits.
(e)
Foreign Currency Risk
Foreign Currency Transactions and Balances
Functional and presentation currency
The functional currency of each of the Group’s entities is measured using the currency of the primary economic
environment in which that entity operations. The consolidated financial statements are presented in Australian
dollars, which is the parent entity’s functional currency.
Transactions and balances
Foreign currency transactions are translated into functional currency using the exchange rates prevailing at the
date of the transaction. Foreign currency monetary items are translated at the year‐end exchange rate.
Non‐monetary items measured at historical cost continue to be carried at the exchange rate at the date of the
transaction. Non‐monetary items measured at fair value are reported at the exchange rate at the date when fair
values were determined.
Exchange differences arising on the translation of monetary items are recognised in profit or loss, except where
deferred in equity as a qualifying cash flow or new investment hedge.
Exchange differences arising on the translation of non‐monetary items are recognised directly in other
comprehensive income to the extent that the underlying gain or loss is recouped in other comprehensive
income; otherwise the exchange difference is recognised in profit or loss.
Foreign exchange risk
Exposure to foreign exchange risk may result in the fair value or future cashflows of a financial instrument
fluctuating due to movement in foreign exchange rates of currencies in which the Group holds financial
instruments which are other than the AUD functional currency of the Group.
The following table shows the foreign currency risk on the financial assets and liabilities of the Group’s
operations denominated in currencies other than the functional currency of the operations. The foreign currency
risk in the books of the parent entity is considered immaterial and is therefore not shown.
Cardinal Resources Limited – Annual Report 2016
P 48
FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2016
Consolidated Group
Functional currency of entity:
Australian dollar
GHS New Cedi
Statement of financial position exposure
(f)
Market Price Risk
Net Financial Assets/(Liabilities) In AUD
AUD
USD
GHS
Total AUD
2,057,645
‐
2,057,645
1,169,600
(20,153)
1,149,447
‐
(55,732)
(55,732)
3,227,245
(75,885)
3,151,360
The Group is not exposed to market price risk as it does not have any investments other than an interest in the
subsidiaries.
22
RELATED PARTY TRANSACTIONS
The Group has no related parties other than the 100% owned subsidiaries disclosed in note 24 and the key
management personnel as detailed in the remuneration report and disclosed in note 7. At 30 June 2016 balances
due from the subsidiaries, which have been fully provided for were:
Australian Dollar ($)
Cardinal Resources (Australia) Pty Ltd
Cardinal Resources Ghana Limited
Cardinal Resources Subranum Limited
Cardinal Mining Services Limited
Cardinal Namdini Mining Limited
30 JUNE 2016
$
30 JUNE 2015
$
5,964,901
4,752,980
87,714
3,918,000
‐
14,723,595
4,306,405
1,548,460
8,020
340,190
‐
6,203,075
These amounts comprise of funds provided by the parent company for exploration activities.
23
SEGMENT REPORTING
For management purposes, the Group is organised into one main operating segment, which involves the
exploration of minerals in Ghana. All of the Group’s activities are interrelated, and discrete financial information
is reported to the Board as a single segment. Accordingly, all significant operating decisions are based upon
analysis of the Group as one segment.
The financial results from this segment are equivalent to the financial statements of the Group as a whole.
The accounting policies applied for internal reporting purposes are consistent with those applied in the
preparation of these financial statements.
24
SUBSIDIARIES
The parent entity, Cardinal Resources Limited, has 100% interest in the below subsidiaries. Cardinal Resources
Limited is required to make all the financial and operating policy decisions of these subsidiaries.
Subsidiaries of Cardinal Resources
Limited
Cardinal Resources (Australia) Pty Ltd
Cardinal Resources Ghana Limited
Cardinal Resources Subranum Limited
Cardinal Mining Services Limited
Cardinal Namdini Mining Limited
Country of incorporation
Percentage owned %
Australia
Ghana
Ghana
Ghana
Ghana
2016
100%
100%
100%
100%
100%
2015
100%
100%
100%
100%
‐
Cardinal Resources Limited – Annual Report 2016
P 49
FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2016
25
PARENT COMPANY DISCLOSURE
(a)
Financial Position for the year ended 30 June 2016
Australian Dollar ($)
Assets
Current assets
Non‐current assets
Total assets
Liabilities
Current liabilities
Non‐current liabilities
Total liabilities
Net assets
Equity
Issued capital
Reserves
Accumulated losses
Total equity
(b)
Financial Performance for the year ended 30 June 2016
Australian Dollar $
Loss for the year
Other comprehensive income
Total comprehensive loss
(c)
Guarantees entered into by the Parent Entity
30 JUNE 2016
$
30 JUNE 2015
$
3,638,374
‐
3,638,374
1,635,481
‐
1,635,481
2,002,893
725,395
‐
725,395
317,532
‐
317,532
407,863
26,273,118
1,342,606
(25,612,831)
2,002,893
14,926,167
744,999
(15,263,303)
407,863
30 JUNE 2016
$
(10,613,334)
‐
(10,613,334)
30 JUNE 2015
$
(2,762,612)
‐
(2,762,612)
30 JUNE 2016
$
30 JUNE 2015
$
‐
‐
‐
‐
Cardinal Resources Limited – Annual Report 2016
P 50
DIRECTOR’S DECLARATION
In the opinion of the Directors of Cardinal Resources Limited (“the Company”)
(a)
The financial statements and the notes and the additional disclosures included in the directors’ report
designated as audited of the Group are in accordance with the Corporations Act 2001, including:
(i)
Giving a true and fair view of the Group’s financial position as at 30 June 2016 and of its
performance for the year ended that date; and
(ii)
Complying with Accounting Standards and Corporations Regulations 2001, and:
(b)
(c)
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 financial statements and notes comply with International Financial Reporting Standards as disclosed
in note 2.
This declaration has been made after receiving the declarations required to be made to the directors in
accordance with section 295A of the Corporations Act 2001 for the financial year ended 30 June 2016.
Signed in accordance with a resolution of the Directors made pursuant to section 295(5) of the Corporations Act
2001.
On behalf of the Board
Archie Koimtsidis
Managing Director
Dated this 30 September 2016
Perth, Western Australia
Cardinal Resources Limited – Annual Report 2016
P 51
P 52 P 53 P 54 SHAREHOLDER INFORMATION
1
Distribution of holders
As at 30 September 2016 the distribution of shareholders was as follows:
Ordinary shares
Size of holding
1 – 1,000
1,001 –5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Total
2
Voting rights
Number of holders
21
105
143
380
187
836
There are no restrictions to voting rights attached to the ordinary shares. On a show of hands every member
present in person will have one vote and upon a poll, every member present or by proxy will have one vote each
share held.
3
Substantial shareholders
The names of the substantial shareholders who have notified the Company in accordance with Section 671B of
the Corporation Act 2001 are;
Shareholder
1832 Asset Management L.P Manager of the Dynamic
Funds
Precious Capital Global Mining and Metals Fund
4
Top 20 shareholders
Shares held
26,977,379
16,414,507
Percentage
interest %
9.07%
5.52%
The names of the 20 largest shareholders on the share register as at 30 September 2016, who hold 71% of the
ordinary shares of the Company, were as follows;
Shareholder
HSBC Custody Nominees (Australia) Limited
Citicorp Nominees Pty Limited
J P Morgan Nominees Australia Limited
Macquarie Bank Limited
Oceanic Capital Pty Ltd
Mr Malik Mohammad Easah
National Nominees Limited
Mr Arthur Koimtsidis
St Barnabas Investments Pty Ltd
Arredo Pty Ltd
Merrill Lynch (Australia) Nominees Pty Limited
Panga Pty Ltd
Invia Custodian Pty Ltd
Corporate International Holdings BV
Redland Plains Pty Ltd
Equity Trustees Limited
Number
79,398,046
26,694,052
19,291,809
12,728,180
9,750,045
7,681,815
7,382,860
6,902,565
6,256,250
5,800,000
4,870,441
3,920,000
3,833,334
3,793,376
3,055,026
3,051,153
Cardinal Resources Limited – Annual Report 2016
P 55
SHAREHOLDER INFORMATION
HSBC Custody Nominees (Australia) Limited – GSCO ECA
HSBC Custody Nominees (Australia) Limited – A/C 3
BNP Paribas Noms Pty Ltd
Yarandi Investments Pty Ltd
5
Top 20 option holders
2,956,013
2,792,144
2,625,137
2,458,288
The names of the 20 largest option holders on the share register as at 30 September 2016, who hold 57% of the
listed options of the Company, were as follows;
Optionholder
Oceanic Capital Pty Ltd
Mr Malik Mohammad Easah
Macquarie Bank Limited
Corporate International Holdings BV
Denman Income Limited
Merrill Lynch (Australia) Nominees Pty Limited
Yarandi Investments Pty Ltd
Cleverman Investments Pty Ltd
Dixtru Pty Limited
RAG Property Group Pty Ltd
AWD Consultants Pty Ltd
Mr Hendrik Hartmann
Citicorp Nominees Pty Limited
Redland Plains Pty Ltd
Arredo Pty Ltd
HSBC Custody Nominees (Australia) Limited
Invia Custodian Pty Ltd
Bainpro Nominees Pty Limited
Riverfront Nominees Pty Ltd
Mrs Sophie Kyriazia
6
Consistency with business objectives
Number
8,058,390
6,560,423
5,000,000
4,766,315
4,748,432
4,524,421
3,200,000
3,085,000
3,000,000
2,843,583
2,500,000
2,430,000
2,259,880
2,200,000
2,000,000
1,960,000
1,950,000
1,947,168
1,850,000
1,767,944
The Company has used its cash and assets in a form readily convertible to cash that it had at the time of listing
in a way the consistent with its stated objectives.
Cardinal Resources Limited – Annual Report 2016
P 56
SCHEDULE OF TENEMENTS
Cardinal Resources Limited mineral interest as at 30 September 2016
Project
Registered Holder
Note
Status
GHANA
Bolgatanga Project
Ndongo Prospect
Cardinal Resources (Ghana) Limited
Prospecting
Kungongo Prospect Cardinal Resources (Ghana) Limited
Bongo Prospect
Cardinal Resources (Ghana) Limited
Reconnaissance
Reconnaissance
Namdini
‐
Subranum Project
2
Small
13
Licenses
Scale
Equity
Registry
No
100%
100%
100%
‐
PL9/22
RL9/28
RL9/29
‐
Subranum Prospect Newmont
1
Prospecting
‐
PL6/309
1.
Subranum Project: Cardinal Resources Subranum Limited has entered into a Sale and Purchase agreement
with Newmont Ghana Gold Limited (a subsidiary of Newmont Mining Corporation) for the purchase of
Subin Kasu Prospecting Licence (the “Subranum Project”).
Subject to the approval of the sale by the relevant Minister for the Ghanaian Mining Act, Cardinal
Resources Subranum Limited will acquire 100% of the Subin Kasu Prospecting Licence and pay to
Newmont Ghana Gold Limited US$50,000 on or before 10 days after the approval date, US$50,000 on the
first anniversay of the approval date and a final $100,000 on the second anniversary date. In addition
Cardinal Resources Subranum Limited will be required to spend US$250,000 on exploration within the
first year from approval and a further US$750,000 in the second year.
Cardinal Resources Subranum Limited will be required to pay Newmont Ghana Gold Limited US$50,000
per annum from the date which Cardinal Resources Subranum Limited reports a “gold resource estimate”
of 1 Moz of Gold. Subject to the grant of a Mining Lease under the Ghanaian Mining Act, Cardinal
Resources Subranum Limited will be required to pay Newmont Ghana Gold Limited a 2% Net Smelter
Royalty.
2.
Namdini Project: Cardinal Mining Services Limited (a subsidiary of Cardinal Resources Limited) acquired
13 Small Scale Licences (the “Namdini Project”) through the sale and purchase agreement with Savannah
Mining Limited (an affiliated company with Cardinal Mining Services).
Cardinal Resources Limited – Annual Report 2016
P 57
Cardinal Resources Limited ABN 56 147 325 620
Ghana: Durugu Residential Area, Kumbosco, Bolgatanga, Ghana P: +233 (0) 261905220 SKYPE: cardinal.archie
Perth: Level 1, 115 Cambridge Street, West Leederville, WA 6007 P: +61 (8) 9322 6600 F: +61 (8) 9322 6610
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