ABN 54 118 912 495
ANNUAL REPORT AND FINANCIAL STATEMENTS
YEAR ENDED 30 JUNE 2009
For personal use only
CONTENTS
PAGE
CORPORATE DIRECTORY
CHAIRMAN’S REPORT
DIRECTORS’ REPORT
AUDITOR’S INDEPENDENCE DECLARATION
BALANCE SHEET
INCOME STATEMENT
STATEMENT OF CHANGES IN EQUITY
CASH FLOW STATEMENT
NOTES TO THE FINANCIAL STATEMENTS
DIRECTORS’ DECLARATION
INDEPENDENT AUDIT REPORT
CORPORATE GOVERANCE STATEMENT
ASX ADDITIONAL INFORMATION
2
3
4
13
14
15
16
17
18
41
42
44
51
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
1
For personal use only
DIRECTORS’ REPORT
CORPORATE DIRECTORY
DIRECTORS
AUDITORS
Steve Boston (Non Executive Chairman -
appointed 1 September 2009)
Robin Scrimegour (Non Executive Director -
appointed 1 September 2009)
RSM Bird Cameron Partners
8 St Georges Terrace
Perth WA 6000
COMPANY SECRETARY
Lisa Wynne
SHARE REGISTRY
Security Transfer Registrars
770 Canning Hwy
Applecross WA 6153
Telephone: +618 9315 2333
Facsimile: +618 9315 2233
REGISTERED OFFICE & PRINCIPAL PLACE OF BUSINESS
22 Oxford Close
West Leederville, Western Australia 6007
Phone:
+618 9381 4360
Facsimile: +618 9381 5911
Email:
info@catalystmetals.com
Website: www.catalystmetals.com
STOCK EXCHANGE LISTING
The Company is listed on Australian Stock
Exchange Limited
Home Exchange – Perth
ASX Code: CYL
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
2
For personal use only
For personal use only DIRECTORS’ REPORT
The Directors present their report on Catalyst Metals Limited for the year ended 30 June 2009.
DIRECTORS
The names of directors in office at any time during or since the end of the year are:
Stephen Boston (Appointed 1 September 2009)
Robin Scrimgeour (Appointed 1 September 2009)
Mark Thompson (Resigned 25 September 2009)
Nathan McMahon (Resigned 1 September 2009)
Bryan Dixon (Resigned 1 September 2009)
Directors have been in office since the start of the financial year to the date of this report unless
otherwise stated.
COMPANY SECRETARY
Lisa Wynne
CORPORATE STRUCTURE
Catalyst Metals Ltd is a company limited by shares that is incorporated and domiciled in Australia.
Catalyst Metals Ltd had no controlled entities during the financial year.
NATURE OF OPERATIONS AND PRINCIPAL ACTIVITIES
The principal activity of the Company during the year was Molybdenum exploration of its Minnie Creek
Project in Western Australia and Everton Project in Victoria.
RESULTS OF OPERATIONS
The operating loss after income tax of the Company for the year ended 30 June 2009 was $1,514,626
(2008: $130,431).
The Company’s basic loss per share for the year was 6.4 cents (2008: 0.6 cents).
DIVIDENDS
No dividend has been paid during or is recommended for the financial year ended 30 June 2009.
EMPLOYEES
The Company employed 3 employees as at 30 June 2009 (2008: 3).
REVIEW OF OPERATIONS
Minnie Creek Project (WA)
During the year work continued at the 90% owned Minnie Creek Project (MCP) which is situated within
the Gascoyne Mineral Field of Western Australia, approximately 240 km northeast of Carnarvon.
Previous exploration undertaken by Catalyst resulted in the discovery of the Minnie Springs Molybdenum
prospect where drilling included highlights such as 31 metres at 1090ppm Mo (0.11% Mo) from 74 metres
depth and 22 metres at 1030ppm Mo (0.10% Mo) from 46 metres depth (Refer ASX release “CYL
Quarterly for Period Ending 30 June 2008”).
Minnie Springs Molybdenum Prospect
Metallurgical Testwork
During the period a preliminary program of metallurgical testwork was undertaken to assess the
amenability of Minnie Springs molybdenum mineralisation to recovery by gravity separation and
flotation processes.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
4
For personal use only
DIRECTORS’ REPORT
REVIEW OF OPERATIONS
Drill core composite sample material used in the testwork showed positive metallurgical results with:
•
molybdenum and rhenium recovered in industry standard flotation processes at coarse grind
sizes (approximately 250 micron) and
a notable advantageous suppression of pyrite and response to the cheaper of flotation
reagents.
•
The resultant molybdenite concentrate was very ‘clean’ with very low levels of bismuth and arsenic that
can be penalty-inducing elements in a molybdenite concentrate. The results showed that gravity
methods are effective in the recovery and concentrate of the molybdenum prior to the flotation stage.
This has potential benefits for decreasing the scale of downstream milling processes and associated
costs.
Multi-element Cu, Ag, Re Analysis
In parallel with metallurgical testwork a program of multi-element analysis of diamond drill holes
MSD004-MSD009 was undertaken with results:
•
returning encouraging elevated rhenium (Re) levels (up to 7.32 g/t Re) which correlated
strongly with intervals of molybdenum mineralisation and
low quantities of copper (a potentially deleterious element for a molybdenite concentrate).
•
Minnie Springs Exploration
Ground reconnaissance aided by UV night lamp prospecting was completed over selected targets
located within a large coincident Cu and W in soils anomaly adjacent to the Minnie Springs
Molybdenum Prospect. Overall, trace to locally minor occurrences of visible tungsten occurring as
scheelite were observed along with isolated float boulders containing scheelite occurring either as
disseminations or fracture fillings. Results of selective sampling of isolated float boulders returned 1.58%
W and 0.06% W.
Nina Tungsten Prospect
The Nina prospect is located approximately 15 km north of the Minnie Springs molybdenum prospect
and represents a new discovery of potentially high grade tungsten (W) ± molybdenum (Mo), Copper
(Cu), Gold (Au) mineralisation associated with either coarse grained quartz - scheelite veins or areas of
disseminations.
Two field programmes were completed during the year with results of reconnaissance prospecting and
sampling successfully defining a 450m x 120m zone of mineralisation. Within this zone at least eight
discrete scheelite bearing quartz veins have been interpreted with the largest vein having a strike length
of ~100m and thickness of up to 1.5m. At least two generations of variably deformed quartz veins are
interpreted to be present throughout the prospect area while host rocks are interpreted to consist
principally of a variably deformed and retrograde altered mafic unit of undetermined origin.
Highlights of reconnaissance sampling included grab samples which returned up to 10.5% W, 1.23 g/t
Au, 0.15% Cu, 0.03% Mo and channel samples across vein faces which returned 1.5m @0.4% W, 1.2m
@0.13% W and 0.4m @0.7% W.
An application for further ground located to the east of the ‘Nina’ prospect has been submitted to
cover extensions along strike where further anomalous levels of tungsten were returned from prior
historic exploration.
Blue Bush Well
First pass ground reconnaissance of priority uranium radiometric anomalies identified from airborne and
ground radiometric data has been completed. Results of selective sampling returned low to
moderately elevated levels of uranium (up to 129ppm) which are interpreted as being sourced from
secondary enriched paleo-channel deposits containing variable calcrete/silcrete contents.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
5
For personal use only
DIRECTORS’ REPORT
REVIEW OF OPERATIONS
Everton Molybdenum Project (Vic)
The Everton Molybdenum Project consists of a ~67km2 area strategically covering the Everton
Molybdenite Field which importantly includes the historic Everton Mining Operation. The Everton Mine,
which to this day remains one of the most significant historic Molybdenum producers in Australia,
treated approximately 21,000 tonnes ore at an average grade 1.40% MoS2 (8392ppm Mo). Although
since the early parts of the 20th century the Everton area has been recognised as containing multiple
historic molybdenum deposits/occurrences relatively limited systematic modern exploration has been
undertaken.
Highlights of work undertaken during the year at the Everton Molybdenum project included:
•
Finalisation and submission of a “standard work plan” for a 1000m diamond and ≤300m shallow
percussion drilling program covering the historic Everton mine/quarry area,
Completion of 1:1000 scale mapping covering the historic Everton Mine/Quarry area,
Completion of a grid based rock chip and soil sampling program over the Trig Hill prospect,
Completion of reconnaissance sampling covering the greater historic Everton Mine area,
Finalisation of land access agreements with private property owners and the local Everton
quarry operators (North Eastern Catchment Management Authority).
•
•
•
•
Mapping
Mapping of the quarry area has demonstrated that the Everton Intrusive body is multiphase and has
intruded into a sequence of bedded meta-psammite and meta-siltstone sequences. Molybdenum
mineralisation generally displays a strong association with areas of quartz veining (either within or
adjacent) but also occurs within fractures/joints or as areas of lower grade disseminations. Associated
sulphides predominantly consist of pyrite with lesser amounts of pyrrhotite, chalcopyrite, and
arsenopyrite.
Trig Hill Prospect
At the Trig Hill Prospect, which is located approximately 2.5km south of the historic Everton Mine, a
systematic 50m x 50m grid soil and rockchip sampling program for respectively 128 and 167 samples
was undertaken. Results successfully outlined a surface anomaly measuring ~200m x ~200m defined by
>250ppm Mo in rocks and >100ppm Mo in soils over the southern parts of the grid. Preliminary ground
follow-up within this area identified moderate to weakly developed stockworks of quartz veinlets/veins
(<5cm) associated with trace visible molybdenum hosted by a felsic intrusive.
Reconnaissance Exploration
Results of reconnaissance sampling completed along strike from the historic Everton mine area
confirmed the continuation of mineralisation north from the quarry area with the return of results up to:
0.07% Mo, 0.9% Cu, 0.8g/t Au, 1.2% Pb, 0.2g/t Re, 312g/t Ag and 0.2% Zn.
SIGNIFICANT CHANGES IN STATE OF AFFAIRS
On 31 December 2008 11,152,500 $0.20 listed options expired unexercised.
There were no other significant changes in the state of affairs of the Company during the financial year.
FUTURE DEVELOPMENTS
Likely future developments in the operations of the Company are referred to in the Chairman’s Report.
Other than as referred to in this report, further information as to likely developments in the operations of
the Company and expected results of those operations would, in the opinion of the Directors, be
speculative and prejudicial to the interests of the Company and its shareholders.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
6
For personal use only
DIRECTORS’ REPORT
SUBSEQUENT EVENTS
There has not been any matter or circumstance that has arisen since 30 June 2009, which has
significantly affected, or may significantly affect the operations of the Company, the result of those
operations, or the state of affairs of the Company in subsequent financial years; other than:
On 16 July 2009, 1,050,000 unlisted executive options expired unexercised.
On 26 July 2009, 4,000,000 Class A Incentive Shares and 4,000,000 Class B Incentive Shares converted
into 89 ordinary shares in the Company in accordance with the Incentive Shares terms and conditions.
On 30 July 2009, the Company issued 3,530,000 ordinary shares at 10 cents per share to raise $353,000.
The funds raised are to be used for further exploration of the Everton project and to provide additional
working capital for the Company.
On 1 September 2009, the Company announced the appointment of Mr Stephen Boston and Mr Robin
Scrimgeour as non-executive Directors of the company and that Mr Nathan McMahon and Mr Bryan
Dixon resigned as Directors.
On 25 September 2009, the Company announced that Mr Mark Thompson resigned as a Director of the
Company.
FINANCIAL POSITION
The Company’s working capital, being current assets less current liabilities was $1,407,310 at 30 June
2009 (2008: $1,990,052).
In the Directors’ opinion there are reasonable grounds to believe that the Company will be able to pay
its debts as and when they become due and payable.
INFORMATION ON DIRECTORS
Stephen Boston (Non-Executive Chairman)
Mr Boston is the Principal of a Perth based private investment bank specialising in the Australian
resources sector. Mr Boston previously worked as a stockbroker from 1984 to 1998 in Perth and Sydney.
Mr Boston holds a Bachelor of Arts from the University of Western Australia.
Memberships:
Senior Associate – Financial Services Institute of Australia
Member - Australian Institute of Company Directors
Special Responsibilities:
Directorships:
On-going corporate and management advice, capital raisings,
investor relations, risk identification, corporate governance.
None
Interests in shares and options: Direct:
Indirect1:
Nil
3,388,094 Ordinary Shares
1 Held by Equity West Pty Ltd, a company in which Mr Boston holds a
relevant interest
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
7
For personal use only
DIRECTORS’ REPORT
Robin Scrimgeour (Non-Executive Director)
Mr Scrimgeour has worked for the last 17 years for Credit Suisse in London, Tokyo, Hong Kong and
Singapore. His most recent experience has been providing structured hybrid financing for corporates in
Asia for project and acquisitions concentrated in the primary resources sector. Mr Scrimgeour’s previous
experience was as a senior equity derivatives trader involved in the pricing of complex structured equity
derivative instruments for both private and corporate clients focused in Asia. Mr Scrimgeour holds a
Bachelor of Economics with Honours from the University of Western Australia.
Special Responsibilities:
On-going corporate and management advice, capital raisings,
investor relations, risk identification, corporate governance.
Directorships:
None
Interests in shares and options: Direct:
Indirect1:
1,100,000 Ordinary Shares
3,388,094 Ordinary Shares
1 Held by Equity West Pty Ltd, a company in which Mr Scrimgeour holds
a relevant interest
Lisa Wynne
(Company Secretary)
Ms Wynne has a Bachelor of Commerce and is a Chartered Accountant with significant experience
working with listed entities in senior financial roles responsible for management and financial reporting,
taxation, and ensuring continuous disclosure and compliance. Ms Wynne presently works with a
number of emerging ASX listed resource companies and specialises in financial and company
secretarial transaction and corporate work.
DIRECTORS’ MEETINGS
The number of meetings attended by each of the Directors of the Company during the financial year
was:
Board Meetings
Audit Committee Meetings
Number held
and entitled
to attend
Number
Attended
Number held
and entitled
to attend
Number
Attended
Mark Thompson (resigned 25 Sep 2009)
Bryan Dixon (resigned 1 Sep 2009)
Nathan McMahon (resigned 1 Sep 2009)
Stephen Boston (appointed 1 Sep 2009)
Robin Scrimgeour (appointed 1 Sep 2009)
7
7
7
-
-
ENVIRONMENTAL ISSUES
6
7
6
-
-
-
2
2
-
-
-
2
2
-
-
The Company’s operations are subject to State and Federal laws and regulation concerning the
environment. Details of the Company performance in relation to environmental regulation are as
follows:
The Company’s exploration activities are subject to the Western Australian and Victorian Mining Acts.
The Company has a policy of complying with or exceeding its environmental performance obligations.
The Board believes that the Company has adequate systems in place for the management of its
environmental requirements. The Company aims to ensure the appropriate standard of environmental
care is achieved, and in doing so, that it is aware of and is in compliance with all environmental
legislation. The Directors of the Company are not aware of any breach of environmental legislation for
the financial year under review.
The Directors of the Company have reviewed the requirements under the National Greenhouse
Emission Regulation (“NGER”). NGER has no impact on the Company.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
8
For personal use only
DIRECTORS’ REPORT
REMUNERATION REPORT
PROCEEDINGS ON BEHALF OF THE COMPANY
No person has applied for leave of Court to bring proceedings on behalf of the Company or intervene
in any proceedings to which the Company is a party for the purpose of taking responsibility on behalf of
the Company for all or any part of those proceedings.
SHARE OPTIONS
As at the date of this report, there were no unissued ordinary shares under option.
This report details the type and amount of remuneration for each director of Catalyst Metals Limited,
and for the executives receiving the highest remuneration. The information provided in this report
includes remuneration disclosures that are required under Accounting Standard AASB 124 Related Party
Disclosures. These disclosures have been transferred from the financial report and have been audited.
Remuneration Policy
It is the company’s objective to provide maximum stakeholder benefit from the retention of a high
quality board by remunerating directors fairly and appropriately with reference to relevant employment
market conditions. To assist in achieving the objective the Board links the nature and amount of
executive directors’ emoluments to the company’s financial and operational performance. The
expected outcomes of this remuneration structure are:
•
•
Retention and Motivation of Directors
Performance rewards to allow Directors to share the rewards of the success of Catalyst Metals
Limited
The remuneration of an executive director will be decided by the Board. In determining competitive
remuneration rates the Committee reviews local and international trends among comparative
companies and the industry generally. It also examines terms and conditions for the employee share
option plan.
The maximum remuneration of non-executive Directors is the subject of Shareholder resolution in
accordance with the Company’s Constitution, and the Corporations Act 2001 as applicable. The
appointment of non-executive Director remuneration within that maximum will be made by the Board
having regard to the inputs and value of the Company of the respective contributions by each non-
executive Director.
The Board may award additional remuneration to non-executive Directors called upon to perform extra
services or make special exertions on behalf of the Company.
There is no scheme to provide retirement benefits, other than statutory superannuation, to non-
executive directors.
All equity based remuneration paid to directors and executives is valued at the cost to the company
and expensed. Options are valued using the Black-Scholes methodology.
Performance Based Remuneration
The issue of options to directors in accordance with the Company’s employee share option plan is to
encourage the alignment of personal and shareholder returns. The intention of this program is to align
the objectives of directors/executives with that of the business and shareholders. In addition all
directors and executives are encouraged to hold shares in the Company.
The Company has not paid bonuses to directors or executives to date.
Company Performance, Shareholder Wealth and Directors’ and Executives’ Remuneration
The remuneration policy has been tailored to maximise the commonality of goals between shareholders
and directors and executives. The method applied in achieving this aim to date has been the issue of
options to directors to encourage the alignment of personal and shareholder interests. The company
believes this policy will be the most effective in increasing shareholder wealth.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
9
For personal use only
DIRECTORS’ REPORT
REMUNERATION REPORT
Details of Remuneration for Year Ended 30 June 2009
Details of the remuneration for each director and the key management personnel (as defined in AASB
124 Related Party Disclosures) of the Company during the year are set out in the following tables.
The key management personnel of the Company includes the directors as per page 4 above and Ms
Wynne, executive officer who’s remuneration must be disclosed under the Corporations Act 2001, being
one of the 5 highest remunerated executives.
2009
Name
Short-term employment
benefits
Cash salary
and fees
Other
Post-
employment
benefits
Superannuation
Share-based
payments
Options
Total
Non-executive directors
B Dixon (i)
N McMahon (ii)
M Thompson (iii)
30,000
37,500
30,000
-
-
54,535 (iii)
Total key management
personnel compensation
Other company officers
L Wynne
97,500
54,535
-
17,530 (iv)
-
-
-
-
-
-
-
-
-
-
30,000
37,500
84,535
152,035
17,530
(i) Mr Dixon’s directors fees were paid to Warrior Strategic Pty Ltd, a company in which Mr Dixon has a
(ii)
relevant interest.
Mr McMahon’s fees were paid to Kingsreef Pty Ltd, a company in which Mr McMahon has a
relevant interest. $30,000 of Mr McMahon’s Director’s fee were accrued at year end.
(iii) Mr Thompson’s directors fees were paid to Lateral Minerals Pty Ltd, a company in which Mr Thompson has
a relevant interest. Red Dog Prospecting Pty Ltd was paid $54,535 for the provision of Mineral Exploration
services. Mr Thompson is a director of Red Dog Prospecting Pty Ltd.
Sila Consulting Pty Ltd was paid $17,530 for the provision of accounting, compliance and company
secretarial services.
(iv)
2008
Name
Non-executive directors
B Dixon (i)
N McMahon
J Malone (to July 2007)
M Carson (from 26 May
2006 to 3 Aug 2007)
H Dawson (to July 2007)(ii)
Executive directors
M Thompson
Total key management
personnel compensation
Other company officers
L Wynne
Short-term employment
benefits
Cash salary
and fees
Other
Post-
employment
benefits
Superannuation
Share-based
payments
Options
Total
30,694
16,175
2,750
-
6,875
3,058
14,437 (ii)
55,000
73,276 (iii)
114,552
87,713
-
-
-
-
-
275
-
275
-
-
-
-
-
-
-
-
30,694
16,175
2,750
-
6,875
17,770
128,276
202,540
14,474
(i) Mr Dixon’s directors fees were paid to Warrior Strategic Pty Ltd, a company in which Mr Dixon has a relevant
14,474 (iv)
-
-
-
interest.
(ii) HG & L Dawson Discretionary Trust, a trust in which Mr Dawson has a relevant interest, was paid
(iii)
(iv)
$14,437 for the provision of geological consulting services.
Red Dog Prospecting Pty Ltd was paid $73,276 for the provision of Mineral Exploration services. Mr
Thomspon is a director of Red Dog Prospecting Pty Ltd.
Sila Consulting Pty Ltd was paid $14,474 for the provision of accounting, compliance and company
secretarial services.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
10
For personal use only
DIRECTORS’ REPORT
REMUNERATION REPORT
Employment Contracts of Directors and Senior Executives
All directors have service agreements in place with the company.
Mr McMahon receives director’s fees of $40,000 per annum inclusive of superannuation requirements.
Mr Thompson to receive director’s fees of $30,000 per annum inclusive of superannuation requirements
plus a daily rate for exploration services on top of his director’s duties.
Mr Dixon receives director’s fees of $30,000 per annum inclusive of superannuation requirements.
The Company Secretary has a monthly agreement on ordinary commercial terms.
SHARE-BASED COMPENSATION
Options over shares in the Company are granted under the Catalyst Metals Limited Employee Incentive
Scheme (Scheme). The purpose of the Scheme is to give employees, directors, executive officers and
consultants of the Company an opportunity, in the form of options, to subscribe for ordinary shares in
the Company. The Directors consider the Scheme will enable the Company to retain and attract skilled
and experienced employees, board members and executive officers and provide them with the
motivation to make the Company more successful.
No options were issued during the 2009 financial period.
INDEMNIFICATION AND INSURANCE OF DIRECTORS AND OFFICERS
The Directors and Officers have indemnities and insurance policies in place during the financial year.
NON-AUDIT SERVICES
The board of directors, in accordance with advice from the audit committee, is satisfied that the
provision of non-audit services during the year
is compatible with the general standard of
independence for auditors imposed by the Corporations Act 2001. The directors are satisfied that the
services disclosed below did not compromise the external auditor’s independence for the following
reasons:
•
all non-audit services are reviewed and approved by the audit committee prior to
commencement to ensure they do not adversely affect the integrity and objectivity of the
auditor; and
the nature of the services provided do not compromise the general principles relating to auditor
independence in accordance with APES 110: Code of Ethics for Professional Accountants set by
the Accounting Professional and Ethical Standards Board.
•
There were no fees for non-audit services were paid/payable to the external auditors during the year
ended 30 June 2009:
AUDITOR’S INDEPENDENCE DECLARATION
The lead auditor’s independence declaration for the year ended 30 June 2009 has been received and
immediately follows the Directors’ Report.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
11
For personal use only
For personal use only For personal use only BALANCE SHEET
As at 30 June 2009
Current Assets
Cash and cash equivalents
Trade and other receivables
Other financial assets
Total Current Assets
Non-Current Assets
Property, plant and equipment
Exploration and evaluation expenditure
Total Non-Current Assets
Note
2009
$
2008
$
6
7
8
9
10
1,415,701
2,028,119
58,564
14,179
1,368
3,160
1,475,633
2,045,458
8,516
15,933
162,294
1,086,761
170,810
1,102,694
TOTAL ASSETS
1,646,443
3,148,152
Current Liabilities
Trade and other payables
TOTAL LIABILITIES
NET ASSETS
Equity
Contributed equity
Share-based payments reserve
Accumulated losses
11
68,323
55,406
68,323
55,406
1,578,120
3,092,746
12
13
13
3,356,710
3,356,710
82,609
82,609
(1,861,199)
(346,573)
TOTAL EQUITY
1,578,120
3,092,746
The above balance sheet should be read in conjunction with the accompanying notes.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
14
For personal use only
INCOME STATEMENT
For the Year Ended 30 June 2009
Revenue
2
120,339
163,589
Note
2009
$
2008
$
Occupancy costs
Professional fees
Administration costs
Personnel
Corporate
Exploration costs written off
Other
Loss before income tax expense
Income tax expense
Net loss attributable to members of Company
Basic loss per share (cents per share)
Diluted loss per share (cents per share)
(22,448)
(39,816)
(53,992)
(90,000)
(41,779)
(1,384,933)
(1,997)
(27,096)
(94,815)
(99,784)
(43,616)
(18,846)
(8,853)
(1,010)
3
5
4
4
(1,514,626)
(130,431)
-
-
(1,514,626)
(130,431)
(6.4 cents)
(0.6 cents)
(6.4 cents)
(0.6 cents)
The above income statement should be read in conjunction with the accompanying notes.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
15
For personal use only
STATEMENT OF CHANGES IN EQUITY
For the Year Ended 30 June 2009
Issued
Capital
$
Accumulated
losses
$
Share-based
payments
reserve
$
Total
$
Balance at 30 June 2007
Loss for the year
Issue of shares
Options exercised
during the year
Balance at 30 June 2008
3,262,210
(216,142)
82,609
3,128,677
-
25,000
69,500
(130,431)
-
-
-
-
-
(130,431)
25,000
69,500
3,356,710
(346,573)
82,609
3,092,746
Loss for the year
-
Balance at 30 June 2009
3,356,710
(1,514,626)
(1,861,199)
-
(1,514,626)
82,609
1,578,120
The above statement of changes in equity should be read in conjunction with the accompanying
notes.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
16
For personal use only
CASH FLOW STATEMENT
For the Year Ended 30 June 2009
Cash Flows from Operating Activities
Payments for exploration and evaluation
Payments to suppliers, contractors and employees
Interest received
Note
2009
$
2008
$
(399,307)
(510,798)
(199,958)
(296,240)
84,912
167,149
Net cash flows used in operating activities
14
(514,353)
(639,889)
Cash Flows from Investing Activities
Payments for property, plant and equipment
Payments for exploration property
Payments for financial assets
(324)
(97,741)
-
(9,128)
(60,900)
(4,040)
Net cash flows used in investing activities
(98,065)
(74,068)
Cash Flows from Financing Activities
Proceeds from issue of shares and other equity securities
Net cash flows from financing activities
-
-
94,500
94,500
Net decrease in cash and cash equivalents
(612,418)
(619,457)
Cash and cash equivalents at the beginning of the
financial year
2,028,119
2,647,576
Cash and cash equivalents at the end of the financial year
6
1,415,701
2,028,119
The above cash flow statement should be read in conjunction with the accompanying notes.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
17
For personal use only
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2009
1.
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES
(a)
Statement of Compliance
The financial report is a general purpose financial report that has been prepared in accordance
with Accounting Standards, including Australian Accounting Interpretations, other authoritative
pronouncements of the Australian Accounting Standards Board and the Corporations Act 2001.
Accounting Standards include Australian equivalents to International Financial Reporting
Standards (‘A-IFRS’). Compliance with the A-IFRS ensures that the financial statements and notes
of the Company comply with International Financial Reporting Standards (‘IFRS’).
The financial report of Catalyst Metals Limited was authorised for issue in accordance with a
resolution of the Director’s on 29 September 2009.
(b)
Basis of preparation
The financial report covers Catalyst Metals Limited, which is a listed public company,
incorporated and domiciled in Australia.
The financial report has been prepared on an accruals basis and is based on historical costs and
does not take into account changing money values or, except where stated, current valuations
of non-current assets. Cost is based on the fair values of the consideration given in exchange for
assets.
The following is a summary of the material accounting policies adopted by the Company in the
preparation of the financial report. The accounting policies have been consistently applied,
unless otherwise stated.
(c)
Revenue
Interest revenue is recognised on a proportional basis taking into account the interest rates
applicable to the financial assets.
(d)
Impairment
At each reporting date, the Company reviews the carrying values of its tangible and intangible
assets to determine whether there is any indication that those assets have been impaired. If such
an indication exists, the recoverable amount of the asset, being the higher of the asset's fair value
less costs to sell and value in use, is compared to the asset's carrying value. Any excess of the
asset's carrying value over its recoverable amount is expensed to the income statement.
Where it is not possible to estimate the recoverable amount of an individual asset, the Company
estimates the recoverable amount of the cash-generating unit to which the asset belongs.
(e) Cash and cash equivalents
For the purpose of the cash flow statement, cash includes cash on hand and at call deposits with
banks or financial institutions and investments in money market instruments with less than 30 days
to maturity.
(f)
Trade and other receivables
Trade receivables, loans, and other receivables are recorded at amortised cost less impairment.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
18
For personal use only
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2009
1.
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (cont’d)
(g)
Financial instruments
Recognition and Initial Measurement
Financial instruments, incorporating financial assets and financial liabilities, are recognised when
the entity becomes a party to the contractual provisions of the instrument. Trade date
accounting is adopted for financial assets that are delivered within timeframes established by
marketplace convention.
Financial instruments are initially measured at fair value plus transaction costs where the
instrument is not classified as at fair value through profit or loss. Transaction costs related to
instruments classified as at fair value through profit or loss are expensed to profit or loss
immediately. Financial instruments are classified and measured as set out below.
Derecognition
Financial assets are derecognised where the contractual rights to receipt of cash flows expires or
the asset is transferred to another party whereby the entity no longer has any significant
continuing involvement in the risks and benefits associated with the asset. Financial liabilities are
derecognised where the related obligations are either discharged, cancelled or expire. The
difference between the carrying value of the financial liability extinguished or transferred to
another party and the fair value of consideration paid, including the transfer of non-cash assets
or liabilities assumed, is recognised in profit or loss.
Classification and Subsequent Measurement
(i) Financial assets at fair value through profit or loss
Financial assets classified as held for trading are included in the category ‘financial assets at fair
value through profit or loss’. Financial assets are classified as held for trading if they are acquired
for the purpose of selling in the near term. Derivatives are also classified as held for trading unless
they are designated as effective hedging instruments. Gains or losses on investments held for
trading are recognised in profit or loss.
(ii) Held-to-maturity investments
Non-derivative financial assets with fixed or determinable payments and fixed maturity are
classified as held-to-maturity when the Company has the positive intention and ability to hold to
maturity. Investments intended to be held for an undefined period are not included in this
classification. Investments that are intended to be held-to-maturity, such as bonds, are
subsequently measured at amortised cost. This cost is computed as the amount initially
recognised minus principal repayments, plus or minus the cumulative amortisation using the
effective interest method of any difference between the initially recognised amount and the
maturity amount. This calculation includes all fees and points paid or received between parties to
the contract that are an integral part of the effective interest rate, transaction costs and all other
premiums and discounts. For investments carried at amortised cost, gains and losses are
recognised in profit or loss when the investments are derecognised or impaired, as well as
through the amortisation process.
(iii) Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments
that are not quoted in an active market. Such assets are carried at amortised cost using the
effective interest method. Gains and losses are recognised in profit or loss when the loans and
receivables are derecognised or impaired, as well as through the amortisation process.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
19
For personal use only
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2009
1.
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (cont’d)
(g)
Financial instruments (cont.)
(iv) Available-for-sale investments
Available-for-sale investments are those non-derivative financial assets that are designated as
available-for-sale or are not classified as any of the three preceding categories. After initial
recognition available-for sale investments are measured at fair value with gains or losses being
recognised as a separate component of equity until the investment is derecognised or until the
investment is determined to be impaired, at which time the cumulative gain or loss previously
reported in equity is recognised in profit or loss.
Fair value
Fair value is determined based on current bid prices for all quoted investments. Valuation
techniques are applied to determine the fair value for all unlisted securities, including recent
arm’s length transactions, reference to similar instruments and option pricing models.
Impairment
At each reporting date, the company assesses whether there is objective evidence that a
financial instrument has been impaired. In the case of available-for-sale financial instruments, a
prolonged decline in the value of the instrument is considered to determine whether an
impairment has arisen. Impairment losses are recognised in the income statement.
(h)
Exploration and Evaluation Expenditure
Exploration and evaluation expenditure
is
accumulated separately for each area of interest. Such expenditure comprises net direct costs
and an appropriate portion of related overhead expenditure. Each area of interest is limited to
a size related to a known or probable mineral resource capable of supporting a mining
operation.
incurred by or on behalf of the Company
Exploration expenditure for each area of interest is written off as incurred, except that it may be
carried forward provided that one of the following conditions is met:
• such costs are expected to be recouped through successful development and exploitation of
the area of interest or, alternatively, by its sale; or
• exploration activities in an area of interest have not, at balance date reached a stage which
permits a reasonable assessment of the existence or otherwise of economically recoverable
reserves.
The Company performs impairment testing when facts and circumstances suggest the carrying
amount has been impaired. If it was determined that the asset was impaired it would be
immediately written off to the income statement.
Expenditure is not carried forward in respect of any area of interest unless the Company’s right of
tenure to that area of interest is current. Expenditures incurred before the Company has
obtained legal rights to explore a specific area is expensed as incurred. Amortisation is not
charged on areas under development, pending commencement of production.
(i)
Trade and other payables
These amounts represent liabilities for goods and services provided to the Company prior to the
end of the financial year which are unpaid. The amounts are unsecured and are usually paid
within 30 days of recognition.
(j)
Provisions
Provisions are measured at the present value of management’s best estimate of the expenditure
required to settle the present obligation at the balance sheet date.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
20
For personal use only
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2009
1.
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (cont’d)
(k)
Employee entitlements
Provision is made for employee benefits accumulated as a result of employees rendering services
up to the reporting date. These benefits include wages and salaries, annual leave and long
service leave.
Liabilities arising in respect of wages and salaries, annual leave and any other employee benefits
expected to be settled within twelve months of the reporting date are measured at their nominal
amounts based on remuneration rates which are expected to be paid when the liability is settled.
All other employee benefit liabilities are measured at the present value of the estimated future
cash outflow to be made in respect of services provided by employees up to the reporting date.
In determining the present value of future cash outflows, the market yield as at the reporting date
on national government bonds, which have terms to maturity approximating the terms of the
related liabilities, are used.
Employee benefit expenses and revenues arising in respect of the following categories:
• wages and salaries, non-monetary benefits, annual leave, long service leave and other leave
benefits, and
• other types of employee benefits are recognised against profits on a net basis in their
respective categories.
(l)
Income tax
Current tax
Current tax is calculated by reference to the amount of income taxes payable or recoverable in
respect of the taxable profit or tax loss for the year. It is calculated using tax rates and tax laws
that have been enacted or substantively enacted by reporting date. Current tax for current and
prior years is recognised as a liability (or asset) to the extent that it is unpaid (or refundable).
Deferred tax
Deferred tax is accounted for using the comprehensive balance sheet liability method in respect
of temporary differences arising from differences between the carrying amount of assets and
liabilities in the financial statements and the corresponding tax base of those items.
In principle, deferred tax liabilities are recognised for all taxable temporary differences. Deferred
tax assets are recognised to the extent that it is probable that sufficient taxable amounts will be
available against which deductible temporary differences or unused tax losses and tax offsets
can be utilised. However, deferred tax assets and liabilities are not recognised if the temporary
differences giving rise to them arise from the initial recognition of assets and liabilities (other than
as a result of a business combination) which affects neither taxable income nor accounting
profit. Furthermore, a deferred tax liability is not recognised in relation to taxable temporary
differences arising from goodwill.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the
year(s) when the asset and liability giving rise to them are realised or settled, based on tax rates
(and tax laws) that have been enacted or substantively enacted by reporting date. The
measurement of deferred tax liabilities and assets reflects the tax consequences that would
follow from the manner in which the Company expects, at the reporting date, to recover or settle
the carrying amount of its assets and liabilities.
Deferred tax assets and liabilities are offset when they relate to income taxes levied by the same
taxation authority and the company intends to settle its current tax assets and liabilities on a net
basis.
Current and deferred tax for the year
Current and deferred tax is recognised as an expense or income in the income statement,
except when it relates to items credited or debited directly to equity, in which case the deferred
tax is also recognised directly in equity, or where it arises from the initial accounting for a business
combination, in which case it is taken into account in the determination of goodwill or excess.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
21
For personal use only
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2009
1.
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (cont’d)
(m)
Intangibles
Research and development
Expenditure during the research phase of a project is recognised as an expense when incurred.
Development costs are capitalised only when technical feasibility studies identify that the project
will deliver future economic benefits and these benefits can be measured reliably.
Development costs have a finite life and are amortised on a systematic basis matched to the
future economic benefits over the useful life of the project.
(n)
Equity based payments
The Company determines the fair value of options issued to employees as remuneration and
recognises the expense in the income statement. This policy is not limited to options and also
extends to other forms of equity based remuneration.
Fair value is measured using a Black-Scholes option pricing model that takes into account the
exercise price, the term of the option, the impact of dilution, the share price at grant date and
expected price volatility of the underlying share, the expected dividend yield and the risk free
interest rate for the term of the option. The expected life used in the model has been adjusted,
based on management’s best estimate, for the effects of non-transferability, exercise restrictions,
and behavioural considerations. The fair value determined at the grant date of the equity-settled
share-based payments is expensed on a straight-line basis over the vesting period.
(o)
Earnings per share
Basic earnings per share is determined by dividing the profit from ordinary activities after related
income tax expense by the weighted average number of ordinary shares outstanding during the
financial year.
(p) Goods and services tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST except:
• where the GST incurred on a purchase of goods and services is not recoverable from the
taxation authority, in which case the GST is recognised as part of the cost of acquisition of
the asset or as part of the expense item as applicable; and
receivables and payables are stated with the amount of GST included.
•
The net amount of GST recoverable from, or payable to, the taxation authority is included as part
of receivables or payables in the balance sheet.
Cash flows are included in the cash flow statement on a gross basis and the GST component of
cash flows arising from investing and financial activities, which are recoverable from, or payable
to, the taxation authority, are classified as operating cash flows.
Commitments and contingencies are disclosed net of the amount of GST recoverable from, or
payable to, the taxation authority.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
22
For personal use only
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2009
1.
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (cont’d)
(q) Critical accounting estimates and judgments
The directors evaluate estimates and judgements incorporated into the financial report based on
historical knowledge and best available current information. Estimates assume a reasonable
expectation of future events and are based on current trends and economic data, obtained
both externally and within the Company.
Significant judgments, estimates and assumptions made by management in the preparation of
these financial statements are outlined below:
Exploration and evaluation
The Company's accounting policy for exploration and evaluation is set out in note 1(h). The
application of this policy necessarily requires management to make certain estimates and
assumptions as to future events and circumstances, in particular the assessment of whether
economic quantities of reserves may be found. Any such estimates and assumptions may
change as new information becomes available. If, after having capitalised expenditure under
the Company’s policy, management concludes that the Company is unlikely to recover the
expenditure by future exploitation or sale, then the relevant capitalised amount will be written off
to the income statement.
Impairment of assets
In determining the recoverable amount of assets, in the absence of quoted market prices,
estimations are made regarding the present value of future cash flows using asset-specific
discount rates. For intangible assets, expected future cash flow estimation is based on, future
production profiles, commodity prices and costs.
(r)
New Accounting Standards for Application in Future Periods
The AASB has issued new, revised and amended standards and interpretations that have
mandatory application dates for future reporting periods. The Company has decided against
early adoption of these standards. A discussion of those future requirements and their impact on
the Company follows:
•
•
AASB 8: Operating Segments and AASB 2007-3: Amendments to Australian Accounting
Standards arising from AASB 8 [AASB 5, AASB 6, AASB 102, AASB 107, AASB 119, AASB 127,
AASB 134, AASB 136, AASB 1023 & AASB 1038] (applicable for annual reporting periods
commencing from 1 January 2009). AASB 8 replaces AASB 114 and requires identification
of operating segments on the basis of internal reports that are regularly reviewed by the
Company’s Board for the purposes of decision making. While the impact of this standard
cannot be assessed at this stage, there is the potential for more segments to be identified.
Given the lower economic levels at which segments may be defined, and the fact that
cash generating units cannot be bigger than operating segments, impairment calculations
may be affected. Management does not presently believe impairment will result however.
AASB 101: Presentation of Financial Statements, AASB 2007-8: Amendments to Australian
Accounting Standards arising from AASB 101, and AASB 2007-10: Further Amendments to
Australian Accounting Standards arising from AASB 101 (all applicable to annual reporting
periods commencing from 1 January 2009). The revised AASB 101 and amendments
supersede the previous AASB 101 and redefines the composition of financial statements
including the inclusion of a statement of comprehensive income. There will be no
measurement or recognition impact on the Company. If an entity has made a prior period
adjustment or reclassification, a third balance sheet as at the beginning of the
comparative period will be required.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
23
For personal use only
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2009
1.
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (cont’d)
(r)
New Accounting Standards for Application in Future Periods (cont’d)
•
•
•
•
•
•
•
AASB 123: Borrowing Costs and AASB 2007-6: Amendments to Australian Accounting
Standards arising from AASB 123 [AASB 1, AASB 101, AASB 107, AASB 111, AASB 116 & AASB
138 and Interpretations 1 & 12] (applicable for annual reporting periods commencing from
1 January 2009). The revised AASB 123 has removed the option to expense all borrowing
costs and will therefore require the capitalisation of all borrowing costs directly attributable
to the acquisition, construction or production of a qualifying asset. Management has
determined that there will be no effect on the Company as a policy of capitalising
qualifying borrowing costs has been maintained by the Company.
AASB 2008-1: Amendments to Australian Accounting Standard – Share-based Payments:
Vesting Conditions and Cancellations [AASB 2] (applicable for annual reporting periods
commencing from 1 January 2009). This amendment to AASB 2 clarifies that vesting
conditions consist of service and performance conditions only. Other elements of a share-
based payment transaction should therefore be considered for the purposes of
determining fair value. Cancellations are also required to be treated in the same manner
whether cancelled by the entity or by another party.
AASB 2008-2: Amendments to Australian Accounting Standards – Puttable Financial
Instruments and Obligations Arising on Liquidation [AASB 7, AASB 101, AASB 132 & AASB
139 & Interpretation 2] (applicable for annual reporting periods commencing from 1
January 2009). These amendments introduce an exception to the definition of a financial
liability to classify as equity instruments certain puttable financial instruments and certain
other financial instruments that impose an obligation to deliver a pro-rata share of net
assets only upon liquidation.
AASB 2008-5: Amendments to Australian Accounting Standards arising from the Annual
Improvements Project (July 2008) (AASB 2008-5) and AASB 2008-6: Further Amendments to
Australian Accounting Standards arising from the Annual Improvements Project (July 2008)
(AASB 2008-6) detail numerous non-urgent but necessary changes to accounting
standards arising from the IASB’s annual improvements project. No changes are expected
to materially affect the Company.
AASB 2008-8: Amendments to Australian Accounting Standards – Eligible Hedged Items
[AASB 139] (applicable for annual reporting periods commencing from 1 July 2009). This
amendment clarifies how the principles that determine whether a hedged risk or portion of
cash flows is eligible for designation as a hedged item should be applied in particular
situations and is not expected to materially affect the Company.
AASB 2008-13: Amendments to Australian Accounting Standards arising from AASB
Interpretation 17 – Distributions of Non-cash Assets to Owners [AASB 5 & AASB 110]
(applicable for annual reporting periods commencing from 1 July 2009). This amendment
requires that non-current assets held for distribution to owners to be measured at the lower
of carrying value and fair value less costs to distribute.
AASB Interpretation 16: Hedges of a Net Investment in a Foreign Operation (applicable for
annual reporting periods commencing from 1 October 2008). Interpretation 16 applies to
entities that hedge foreign currency risk arising from net investments in foreign operations
and that want to adopt hedge accounting. The interpretation provides clarifying
guidance on several issues in accounting for the hedge of a net investment in a foreign
operation and is not expected to impact the Company.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
24
For personal use only
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2009
1.
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (cont’d)
(r)
New Accounting Standards for Application in Future Periods (cont’d)
•
AASB Interpretation 17: Distributions of Non-cash Assets to Owners (applicable for annual
reporting periods commencing from 1 July 2009). This guidance applies prospectively only
and clarifies that non-cash dividends payable should be measured at the fair value of the
net assets to be distributed where the difference between the fair value and carrying
value of the assets is recognised in profit or loss.
The Company does not anticipate early adoption of any of the above reporting requirements
and does not expect these requirements to have any material effect on the Company’s financial
statements.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
25
For personal use only
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2009
2.
Revenue
Interest received
Other revenue
3.
Expenses
Loss before income tax includes the following specific
expenses:
Directors fees
Exploration written off (refer note 1(h))
Depreciation
Project costs
(Gain)/loss on fair value of other financial assets
4.
Earnings per Share
2009
$
2008
$
87,454
32,885
120,339
163,589
-
163,589
97,500
1,384,933
7,741
97,740
1,792
71,357
8,853
6,297
68,679
880
2009
No. of Shares
2008
No. of Shares
Weighted average number of ordinary shares for basic and
diluted earnings per share
23,558,137
23,406,711
(i)
Diluted earnings per share are calculated after classifying all options on issue remaining
unconverted at 30 June 2009 as potential ordinary shares. As at 30 June 2009, the
Company has 1,050,000 options over unissued capital and has incurred a net loss. As
the notional exercise prices of these options is greater than the current market price of
the shares, they have not been included in the calculations of the diluted earnings per
share as they are anti-dilutive for all periods presented.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
26
For personal use only
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2009
5.
Income tax
Loss before tax
Prima facie tax on operating loss before income
tax at 30%
(1,514,626)
(130,431)
(454,387)
(39,129)
2009
$
2008
$
Tax effect of:
- non deductible items
- deductible capital raising expenditure
Deferred tax asset not brought to account at balance
date as realisation of the benefit is not probable
Income tax attributable to operating loss
Unrecognised deferred tax balances
The directors estimate that the potential deferred tax
benefits not brought to account at balance date is
approximately:
Tax losses
Temporary differences
(9,516)
-
124
(13,547)
463,903
52,552
-
-
2,049,824
(34,083)
2,015,741
355,700
1,008,324
1,364,024
Net unrecognised deferred tax asset at 30%
604,722
409,602
The potential deferred tax asset, arising from tax losses and temporary differences (as disclosed
above), has not been recognised as an asset because recovery of tax losses and temporary
differences is not considered probable.
The potential deferred tax asset will only be obtained if:
-
-
-
the relevant Company derives future assessable income of a nature and an amount
sufficient to enable the benefit to be realised;
the relevant Company continues to comply with the conditions for deductibility
imposed by tax legislation; and
no changes in tax legislation adversely affect the relevant Company in realising the
benefit from the deduction for the losses.
6.
Cash and cash equivalents
Cash at bank
7.
Trade and other receivables
2009
$
2008
$
1,415,701
2,028,119
Sundry debtors
58,564
14,179
Fair value and credit risk
Due to the short term nature of the receivables, their carrying value is assumed to approximate
their fair value.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
27
For personal use only
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2009
2009
$
2008
$
8.
Financial assets at fair value through profit or loss
Current
Shares - in listed corporation - at fair value
1,368
3,160
Listed shares at fair value
The fair value of listed investments has been determined directly by reference to published
price quotations in an active market. Changes in fair values of financial assets at fair value
through profit or loss are recorded in other income or other expense in the income statement.
9.
Property, plant and equipment
Computer
equipment
Furniture,
fittings and
equipment
Total
$
Year ended 30 June 2009
Opening net book amount 1 July 2008
5,140
10,793
15,933
Additions
Disposals
Depreciation charge
Closing net book amount 30 June 2009
At 30 June 2009
Cost or fair value
Accumulated depreciation
Net book amount
-
-
(2,357)
2,783
7,412
(4,776)
2,636
324
-
(5,384)
5,733
324
-
(7,741)
8,516
16,212
(10,332)
5,880
23,624
(15,108)
8,516
10.
Exploration and evaluation expenditure
Opening balance
Additions
Exploration written off (refer note 1(h))
Closing balance
11.
Trade and other payables
Current Payables
Trade creditors
Accruals
2009
$
1,086,761
460,466
(1,384,933)
2008
$
523,077
572,537
(8,853)
162,294
1,086,761
2009
$
2008
$
28,323
40,000
68,323
16,512
38,894
55,406
Due to the short term nature of these payables, their carrying value is assumed to approximate
their fair value. Trade and other payables are non-interest bearing and normally settled on 30-
day terms.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
28
For personal use only
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2009
12.
Contributed Equity
(a)
Share capital
Ordinary shares
Fully paid
Incentive shares
Class A
Class B
(b) Other equity securities
Options – Listed
Options - Unlisted
Total contributed equity
(c) Movements in Ordinary
Shares
Details
Balance at 30 June 2007
Issue of shares
Exercise of options
Transfer from option reserve
Balance at 30 June 2008
Transfer from option reserve
Balance at 30 June 2009
(d) Movements in other equity
securities
Details
Listed Options
Balance at 30 June 2007
Exercise of options
Balance at 30 June 2008
Lapsed options
Balance at 30 June 2009
(e) Ordinary shares
2009
Number
2009
$
2008
Number
2008
$
(c)
23,558,137
3,348,710
23,558,137
3,249,407
4,000,000
4,000,000
4,000
4,000
4,000,000
4,000,000
4,000
4,000
31,558,137
3,356,710
31,558,137
3,257,407
(d)
-
1,050,000
-
-
11,152,500
99,303
1,050,000
-
3,356,710
3,356,710
Number of
Shares
Issue price
$
$0.1187
$0.2000
23,000,000
210,637
347,500
-
23,558,137
-
23,558,137
3,151,432
25,000
69,500
3,475
3,249,407
99,303
3,348,710
Number of
Shares
Issue price
$
11,500,000
(347,500)
11,152,500
(11,152,500)
-
0.01
102,778
(3,475)
99,303
(99,303)
-
On a show of hands, every member present in person or by proxy shall have one vote and,
upon a poll, each share shall have one vote.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
29
For personal use only
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2009
12.
Contributed Equity (Cont.)
(f) Incentive Shares
Class A Incentive Shares
•
The Class A Incentive shares are a separate class of shares that will be convertible into ordinary
shares. They do no carry any voting rights in the company or rights to participate in new issues
(whether bonus or rights) in the Company.
•
Each incentive share will convert into one ordinary share upon the earlier of:
(i)
(ii)
(iii)
the volume weighted average price for 30 days of Catalyst Metals Limited ordinary shares
exceeds $0.50 or;
the Company directly or indirectly secures an asset with JORC measured, indicated and
inferred resources exceeding 150,000 gold equivalent ounces;
a takeover bid becoming unconditional; entering into and the Court approving a solvent
scheme of arrangement or reconstruction which has the effect of changing the control
of the Company.
•
If the above do not occur, within 3 years from the date the Company’s ordinary shares are
admitted to quotation of ASX, each 100,000 incentive shares will convert into one ordinary share
(with any fractional entitlement being rounded up to the nearest whole full paid share.
•
The incentive shares are unlisted and non transferable.
Class B Incentive Shares
•
The Class B Incentive shares are a separate class of shares that will be convertible into ordinary
shares. They do no carry any voting rights in the company or rights to participate in new issues
(whether bonus or rights) in the Company.
•
Each incentive share will convert into one ordinary share upon the earlier of:
(i)
(ii)
(iii)
the volume weighted average price for 30 days of Catalyst Metals Limited ordinary shares
exceeds $0.75 or;
the Company directly or indirectly secures an asset with JORC measured, indicated and
inferred resources exceeding 225,000 gold equivalent ounces;
a takeover bid becoming unconditional; entering into and the Court approving a solvent
scheme of arrangement or reconstruction which has the effect of changing the control
of the Company; and
conditional on the Minnie Creek Project being the main focus of the Company at the
time of the (i), (ii) and (iii) above.
•
If the above do not occur, within 3 years from the date the Company’s ordinary shares are
admitted to quotation of ASX, each 100,000 incentive shares will convert into one ordinary share
(with any fractional entitlement being rounded up to the nearest whole full paid share.
•
The incentive shares are unlisted and non transferable.
(g) Options
Unlisted Executive Options
The options entitle the holders to subscribe for fully paid ordinary shares in the Company and
the Option may be exercised at any time until 16 July 2009. The options were issued as three
different series, with strike price of $0.25, $0.30 and $0.35 respectively. These Options lapse at
5.00pm WST on 16 July 2009.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
30
For personal use only
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2009
12.
Contributed Equity (Cont.)
(h) Capital risk management
When managing capital, management’s objective is to ensure the entity continues as a going
concern as well as to maintain optimal returns to shareholders and benefits for other
stakeholders. Management also aims to maintain a capital structure that ensures the lowest
cost of capital available to the entity.
In order to maintain or adjust the capital structure, the entity may adjust the amount of
dividends paid to shareholders, return capital to shareholders, issue new shares, enter into joint
ventures or sell assets.
The entity does not have a defined share buy-back plan.
No dividends were paid in 2009 and no dividends are expected to be paid in 2010.
There is no current intention to incur debt funding on behalf of the Company as on-going
exploration expenditure will be funded via cash reserves, equity or joint ventures with other
companies.
The Company is not subject to any externally imposed capital requirements.
13.
Reserves & Retained Profits
a)
Reserves
Share-based payments reserve
Balance at the beginning of the year
Share balance payments expense
Balance at the end of the year
2009
$
82,609
-
82,609
2008
$
82,609
-
82,609
The share-based payments reserve records the value of share options issued by the Company.
b)
Retained losses
Balance at the beginning of the year
Loss for the year
Balance at the end of the year
346,573
1,514,626
1,861,199
216,142
130,431
346,573
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
31
For personal use only
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2009
14.
Notes to the Cash Flow Statement
(a) Reconciliation of net cash used in operating activities
to operating loss after income tax
2009
$
2008
$
Operating loss after tax
(1,514,626)
(130,431)
Add non cash items:
Depreciation
Net loss on disposal of non-current assets
Share-based payments expense
(Gain)/loss on fair value of other financial assets
Exploration written off
Changes in net assets and liabilities
Increase in receivables
Increase/(decrease) in payables
Increase in exploration
7,741
6,297
-
-
1,792
1,384,933
-
-
880
8,853
(34,170)
31,597
(391,620)
(206)
(13,644)
(511,638)
Net cash outflow from operating activities
(514,353)
(639,889)
(b) Non-cash financing and investing activities
The Company did not have any non-cash financing or investing activities during the year
(2008: Nil)
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
32
For personal use only
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2009
15.
Key Management Personnel Compensation
(a) Directors and Specified Executives
The names and positions held by key management personnel in office at any time during the
year are:
Directors
N McMahon
M Thompson
B Dixon
Non-Executive Chairman
Non-Executive Director
Non-Executive Director
Executives & Officers
L Wynne
Company Secretary
All of the above persons were also key management persons during the year ended 30 June
2009.
(b)
Key management personnel remunerations
Short-term employee benefits
Post-employment benefits
Share based payments
2009
169,565
-
-
169,565
2008
216,739
275
-
217,014
Detailed remuneration disclosures have been transferred to the Director’s Report on pages 9 to
11.
(c)
Equity instrument disclosures relating to key management personnel
(i)
(ii)
Options provided as remuneration and shares issued on exercise of such options
Details of options provided as remuneration and share issued on the exercise of such
options, together with terms and conditions of the options, can be found in the
remuneration report on pages 9 to 11 of the Directors’ Report.
Option holdings
The number of options over ordinary shares in the company held during the year by
each director of the Company and other key management personnel, including their
personally related parties, are set out below:
2009
Directors
Balance at
beginning of
year
M Thompson
1,595,000
Bryan Dixon
Nathan
McMahon
-
-
Granted as
compensation
Exercised
Other
changes 1
Balance at end of
year
Vested and
exercisable
Other key management personnel
Lisa Wynne
9,375
-
-
-
-
-
-
-
-
(545,000)
1,050,000
1,050,000
-
-
-
-
-
9,375
-
-
-
1 545,000 listed options expired on 31 December 2008.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
33
For personal use only
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2009
15.
Key Management Personnel Compensation (cont’d)
2008
Directors
Balance at
beginning of
year
M Thompson
1,595,000
Bryan Dixon
220,000
Nathan
McMahon
J Malone
H Dawson
M Carson
-
457,500
395,000
10,000
Other key management
personnel
Lisa Wynne
9,375
Granted as
compensation
Exercised
Other
changes
Balance at end
of year
Vested and
exercisable
1,595,000
1,595,000
-
-
-
(457,500) (i)
(395,000) (i)
(10,000) (ii)
-
-
-
-
-
-
-
-
(220,000)
-
-
-
-
-
-
-
-
-
-
-
9,375
-
-
-
-
-
-
(i)
(ii)
On 27 July 2007, the shareholders voted to remove Messers Dawson and Malone from
the board of the Company.
On 3 August 2007, Mr Carson resigned from the board.
(iii)
Shareholdings
Ordinary Shares
The number of ordinary shares in the company held during the financial year by each
director and other key management personnel of the Company, including their
personally related parties, are set out below. There were no shares granted during the
year as compensation.
2009
Directors
M Thompson
Bryan Dixon
Nathan McMahon
Balance at
beginning of
year
1,265,250
-
900,000
Purchased
Other changes
Balance at end of year
-
-
-
-
-
-
1,265,250
-
900,000
Other key management personnel
Lisa Wynne
-
-
-
-
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
34
For personal use only
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2009
15.
Key Management Personnel Compensation (cont’d)
2008
Directors
M Thompson
Bryan Dixon
Nathan McMahon
M Carson
H Dawson
J Malone
Other key management personnel
Balance at
beginning of
year
Received during
the year on
exercise of
options
Other changes
Balance at end of
year
1,090,000
415,000
665,455
20,000
1,040,000
965,000
-
175,250
145,000
-
1,265,250
(560,000) (iii)
-
1,001,098
(766,553) (iii)
900,000
-
-
-
-
(20,000) (ii)
(1,040,000)(i)
(965,000) (i)
-
-
-
-
-
Lisa Wynne
(i)
(ii)
(iii)
On 27 July 2007, the shareholders voted to remove Messers Dawson and Malone from the board
of the Company.
On 3 August 2007, Mr Carson resigned from the board.
As disclosed in an ASX release on 29 April 2008, an involuntary sale of 1,326,553 ordinary shares in
April 2008 pursuant to the (purported) exercise of rights by a creditor of Opes Prime Group Ltd. No
consideration has been received by either Mr McMahon or Mr Dixon at this time. Mr McMahon
and Mr Dixon are pursuing actions against the major financier of the Opes Prime Group Ltd.
(d)
Equity instrument disclosures relating to key management personnel
Incentive shares
The number of incentive shares in the company held during the financial year by each personally
related parties, are set out below:
2009
Directors
Class A Incentive Shares
Class B Incentive Shares
Balance at
beginning of
year
Other
changes
Balance at
end of year
Balance at
beginning of
year
Other
changes
Balance at
end of year
M Thompson
B Dixon
N McMahon
1,000,000
-
-
-
-
-
1,000,000
1,000,000
-
-
-
-
-
-
-
1,000,000
-
-
2008
Directors
M Thompson
B Dixon
N McMahon
M Carson
H Dawson
Balance at
beginning of
year
1,000,000
-
-
-
600,000
(600,000)
J Malone
900,000
(i)
(900,000)
(i)
Class A Incentive Shares
Class B Incentive Shares
Other
changes
Balance at
end of year
Balance at
beginning of
year
Other
changes
Balance
at end of
year
-
-
-
-
1,000,000
1,000,000
-
-
-
-
-
-
-
-
600,000
900,000
(600,000)
(i)
(900,000)
(i)
-
-
-
-
1,000,000
-
-
-
-
-
(i)
On 27 July 2007, the shareholders voted to remove Messers Dawson and Malone from
the board of the Company.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
35
For personal use only
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2009
15.
Key Management Personnel Compensation (cont’d)
(d)
Other transactions with key management personnel
Mr McMahon is a director and shareholder of Cazaly Resources Limited. Catalyst Metals
Limited had an agreement based on normal commercial terms and conditions to reimburse for
office rental and administration and overheads.
Mr Thompson, is a related party of Red Dog Prospecting Pty Ltd. Catalyst Metals Limited has
agreed to engage Red Dog Prospecting Pty Ltd based on normal commercial terms and
conditions for the provision of exploration and development services and vehicle hire.
Aggregate amounts of each of the above types of other transactions with key management
personnel of Catalyst Metals Limited:
Purchases
Rent of office building
Administrative and office overheads
Exploration services and vehicle hire
Sales
Reimbursements for secretarial services
16.
Related Party Disclosures
Key Management Personnel
2009
$
26,400
10,543
59,988
2008
$
29,806
3,804
83,589
-
605
Red Dog Option and Joint Venture Agreement (Red Dog Agreement)
Red Dog Prospecting Pty Ltd, a company which Mr Thompson is both a director and
shareholder, entered into an Option and Joint Venture Agreement with Catalyst on 25 May
2006. Red Dog granted Catalyst an option to purchase a 90% interest in Tenements E09/1187,
E09/1174 and E09/1291 for a purchase price of $100,000 (Option). Catalyst exercised the
Option in July 2006. On the exercise of the Option by Catalyst, a joint venture was established
between the parties (with Catalyst having a participating share of 90% and Red Dog having a
participating share of 10%) for the purposes of prospecting, exploring and, if so decided by the
parties, mining of marketable minerals and other commodities. Catalyst will be required to sole
fund all exploration costs up to completion of a feasibility study. Catalyst will be Manager of the
joint venture and, whilst it is solely funding exploration costs, it will have conduct of the joint
venture operations as it sees fit.
17.
Equity-based payments
The Company has entered into an Employee Share Option Plan that allows for share options to
be granted to eligible employees and officers of the Company. The number of share options that
can be issued under the plan cannot exceed 5% of the total number of shares on issue. The terms
and conditions of the share options issued under the plan are at the discretion of the Board
however, the maximum term of the share option is five years.
No options were granted during the year.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
36
For personal use only
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2009
18.
Auditors’ Remuneration
Amounts received or due and receivable by the auditors for:
Auditing accounts
Other services
19.
Commitments
There were no outstanding commitments, which are not
disclosed in the financial statements as at 30 June 2009
other than:
(a) Tenement commitments
No later than 1 year
Later than 1 year but not later than 5 years
2009
$
2008
$
15,750
12,750
-
-
15,750
12,750
2009
$
2008
$
295,000
310,000
-
-
295,000
310,000
20.
Financial Instruments
Notes
Floating
Interest
Rate
$
1 year or
less
Over 1-5
years
$
$
Non
interest
bearing
$
Total
$
2009
Financial assets
Cash and cash
equivalents
Trade and other
receivables
Other financial assets
Total financial assets
Financial liabilities
Trade and other
payables
Total financial liabilities
6
7
11
4.02%
1,409,319
-
-
-
-
1,409,319
-
-
Net financial assets/(liabilities)
1,409,319
-
-
-
-
-
-
-
6,382
1,415,701
58,564
58,564
1,368
1,368
66,314
1,475,633
68,323
68,323
68,323
68,323
(2,009)
1,407,310
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
37
For personal use only
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2009
20.
Financial Instruments (Cont.)
2008
Financial assets
Cash and cash
equivalents
Trade and other
receivables
Other financial assets
Total financial assets
Financial liabilities
Trade and other
payables
Total financial liabilities
6
7
11
7.30%
2,033,629
-
-
-
-
2,033,629
-
-
Net financial assets/(liabilities)
2,033,629
Reconciliation of net financial assets to net assets
Net Financial Assets
Property, plant & equipment
Exploration expenditure
Net Assets
-
-
-
-
-
-
-
(5,510)
2,028,119
14,179
14,179
3,160
3,160
11,829
2,045,458
55,406
55,406
55,406
55,406
(43,577)
1,990,052
2009
$
2008
$
1,407,310
1,990,052
8,516
15,933
162,294
1,086,761
1,578,120
3,092,746
The Company’s principal financial instruments comprise cash, short-term deposits and financial
assets at fair value through profit or loss.
The main purpose of these financial instruments is to finance the company’s operations. The
company has various other financial assets and liabilities such as sundry receivables, and trade
payables, which arise directly from its operations.
The main risks arising from the company’s financial instruments are cash flow interest rate risk and
equity price risk. Other minor risks are either summarised below and Note 13 with respect to
capital risk management. The Board reviews and agrees policies for managing each of these
risks.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
38
For personal use only
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2009
20.
Financial Instruments (Cont.)
Market Risks
Interest rate risks
The company’s exposure to the risks of changes in market interest rates relates primarily to the
company’s short-term deposits with a floating interest rate. These financial assets with variable
rates expose the company to cash flow interest rate risk. All other financial assets and liabilities in
the form of receivables and payables are non-interest bearing. The company does not engage
in any hedging or derivative transactions to manage interest rate risk.
Interest rate sensitivity
At 30 June 2009, if interest rates had changed by 100 basis points during the entire year with all
other variables held constant, profit for the year and equity would have been $14,903
lower/higher, mainly as a result of lower/higher interest income from cash and cash equivalents.
A sensitivity of 100 basis points has been selected as this is considered reasonably possible in the
current economic environment. Based on the sensitivity analysis only interest revenue from
variable rate deposits and cash balances are impacted resulting in a decrease or increase in
overall income.
Credit risk
The maximum exposure to credit risk at balance date is the carrying amount (net of provision of
doubtful debts) of those assets as disclosed in the balance sheet and notes to the financial
statements. The Company has adopted a policy of only dealing with creditworthy
counterparties and obtaining sufficient collateral where appropriate, as a means of mitigating
the risk of financial loss from defaults. The Company’s exposure and the credit ratings of its
counterparties are continuously monitored and the aggregate value of transactions concluded
are spread amongst approved counterparties.
Liquidity risk
The responsibility for liquidity risk management rests with the Board of Directors. The Company
manages liquidity risk by maintaining sufficient cash or credit facilities to meet the operating
requirements of the business and investing excess funds in highly liquid short term investments.
21.
Segment Information
The Company operates predominantly in one business segment and in one geographical location.
The operations of the Company consist of mineral exploration, within Australia.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
39
For personal use only
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2009
22.
Subsequent Events
There has not been any matter or circumstance that has arisen since 30 June 2009, which has
significantly affected, or may significantly affect the operations of the Company, the result of those
operations, or the state of affairs of the Company in subsequent financial years other than:
On 16 July 2009, 1,050,000 unlisted executive options expired unexercised.
On 26 July 2009, 4,000,000 Class A Incentive Shares and 4,000,000 Class B Incentive Shares converted
into 89 ordinary shares in the Company in accordance with the Incentive Shares terms and
conditions.
On 30 July 2009, the Company issued 3,530,000 ordinary shares at 10 cents per share to raise
$353,000. The funds raised are to be used for further exploration of the Everton project and to
provide additional working capital for the Company.
On 1 September 2009, the Company announced the appointment of Mr Stephen Boston and Mr
Robin Scrimgeour as non-executive Directors of the company and that Mr Nathan McMahon and
Mr Bryan Dixon resigned as Directors.
On 25 September 2009, the Company announced that Mr Mark Thompson resigned as a Director of
the Company.
23.
Contingent Liabilities and Contingent Assets
The Company does not have any contingent liabilities or contingent assets at 30 June 2009.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2009
40
For personal use only
For personal use only For personal use only For personal use only CORPORATE GOVERNANCE
The Company is committed to implementing the highest standards of corporate governance. In determining
what those high standards should involve the Company has turned to the ASX Corporate Governance
Council’s Corporate Governance Principles and Recommendations, 2nd Edition. The Company is pleased to
advise that the Company’s practices are largely consistent with those ASX guidelines. As consistency with the
guidelines has been a gradual process, where the Company did not have certain policies or committees
recommended by the ASX Corporate Governance Council (the Council) in place during the reporting period,
we have identified such policies or committees.
The Board of Directors of Catalyst Metals Limited is responsible for corporate governance of the Company.
The Board guides and monitors the business and affairs of Catalyst Metals Limited on behalf of the
shareholders by whom they are elected and to whom they are accountable.
Where the Company’s corporate governance practices do not correlate with the practices recommended
by the Council, the Company is working towards compliance however it does not consider that all the
practices are appropriate for the Company due to the size and scale of Company operations.
For further information on corporate governance policies adopted by Catalyst Metals Limited, refer to our
website: www.catalystmetals.com.au.
Board Objectives
The Board will develop strategies for the Company, review strategic objectives, and monitor the performance
against those objectives. The overall goals of the corporate governance process are to:
•
•
•
drive shareholders value;
assure a prudential and ethical base to the Company’s conduct and activities; and
ensure compliance with the Company’s legal and regulatory obligations.
Principle 1: Lay solid foundations for management and oversight
The board has adopted a Charter that sets out the roles and responsibilities of the board. This may be viewed
at www.catalystmetals.com.au. The Charter includes, amongst other things that the Board will:
•
•
•
•
•
•
•
develop initiatives for profit and assets growth;
review the corporate, commercial and financial performance of the Company on a regular
basis;
act on behalf of, and be accountable to, the Shareholders;
identify business risks and implement actions to manage those risks;
develop and effect management and corporate systems to assure quality;
review the Company’s systems of risk management and
codes of conduct and legal compliance; and
internal compliance and control,
ensure that policies and procedures are in place consistent with the Company’s objectives, and ensure
the Company and its officers act legally, ethically and responsibly in all matters.
The Company is committed to the circulation of relevant materials to Directors in a timely manner to facilitate
Directors’ participation in Board discussions on a fully informed basis.
Senior Executives evaluation
The Board consists of two (2) members, none of which hold executive roles. The Board therefore undertakes
ongoing self-assessment and review of performance of the Board, and individual directors annually. The
Chairman of the Board is responsible for determining the process for evaluating Board performance.
To facilitate optimal performance, the Executives participate in professional development programs.
44
For personal use only
CORPORATE GOVERNANCE
Principle 2: Structure the board to add value
Composition
The board currently consists of two non-executive directors, including the chairman. Details of their
experience, qualifications and committee memberships are set out below. All directors were in office at the
date of this report:
Stephen Boston – Chairman
Non Independent Non-executive Chairman since September 2009
Term in office – 1 month
Mr Boston is the Principal of a Perth based private investment bank specialising in the Australian resources
sector. Previously Mr Boston worked as a stockbroker from 1984 to 1998 in Perth and Sydney. Mr Boston holds a
Bachelor of Arts from the University of Western Australia.
Robin Scrimgeour
Non Independent Non-executive director since September 2009
Term in office – 1 month
Mr Scrimgeour has worked for the last 17 years for Credit Suisse in London, Tokyo, Hong Kong and Singapore
where he has specialised in providing structured hybrid financing to Asian corporates for resource sector
projects and acquisitions. Previously Mr Scrimgeour was a senior equity derivatives trader involved in the
pricing of complex structured equity derivative instruments for both private and corporate clients focused in
Asia. Mr Scrimgeour holds a Bachelor of Economics with Honours from the University of Western Australia.
Appointment
Election of Board members is substantially the province of the Shareholders in general meeting. However, the
Company commits to the following principles:
•
•
the Board to comprise of Directors with a blend of skills, experience and attributes appropriate for the
Company and its business;
the principal criterion for the appointment of new Directors being their ability to add value to the
Company and its business.
Board Independence
The Board has accepted the ASX Corporate Governance Councils definition of an Independent Director
contained in their report titled “Corporate Governance Principles and Recommendations, 2nd Edition.”.
None of the Directors are considered Independent. In reaching that determination, the Board has taken into
account:
•
•
The specific disclosures made in accordance with the Corporations Act, but each such director in
respect of any material contract or relationship;
•
That no such director is, or is associated directly with, a substantial shareholder of the company ;
• Where applicable, the related party dealings referable to each such Director, noting that those
dealings are not material under accounting standards. Full details of related party dealings are set
out in the notes to the financial statements;
That no such non-executive Director has within the last three years been employed in an executive
capacity by the company;
That no such non-executive Director is , or is associate with a supplier or customer of the company
which is material under accounting standards; and
That such non-executive Director’s are free from any interest and any business or other relationship
which could, or could reasonable be perceived to, materially interfere with the director’s ability to
act in the best interests of the Company.
•
•
45
For personal use only
CORPORATE GOVERNANCE
Under the accounting standards, a matter is considered to be material if it is equal to or greater than 10% of
the appropriate base amount.
Mr Boston does not meet the Company’s criteria for independence. Mr Boston has a material shareholding in
the Company. Mr Boston’s experience and knowledge of the Company make his contribution to the Board
such that it is appropriate for him to remain on the Board.
Mr Scrimgeour does not meet the Company’s criteria for independence. Mr Scrimgeour has a material
shareholding in the Company. Mr Scrimgeour’s experience and knowledge of the Company make his
contribution to the Board such that it is appropriate for him to remain on the Board.
Given the size of the company and the industry in which is operates, the current Board structure is considered
to best serve the Company in meeting its objectives, given its small capitalisation, limited resources and
existing operations. The composition of the Board is reviewed on an annual basis to ensure that the Board has
the appropriate mix of expertise and experience.
It should also be noted that due to the recent changes in the structure of the Catalyst Board, the remaining
directors have commenced the process of identifying suitably qualified candidates to be appointed to the
Catalyst Board.
Independent professional advice
There are procedures in place, as agreed by the board, to enable directors to seek independent professional
advice on issues arising in the course of their duties at the company’s expense.
Remuneration and Nomination Committee
A Remuneration and Nomination Committee Charter has been established by the Board to assess and make
recommendations regarding membership of the Board, including proposed new appointments.
Given the size and scope of the operations of the Company, the full board has assumed those responsibilities
that are ordinarily assigned to a remuneration and nomination committee.
Where appropriate, independent consultants are engaged to identify possible new candidates for the Board.
Nomination Arrangements
Where a vacancy is considered to exist, the Committee will select an appropriate candidate through
consultation with external parties and consideration of the needs of shareholders and the Company. Such
appointments will be referred to shareholders for re-election at the next annual general meeting. All Directors,
except the Managing Director, are subject to re-election by shareholders at least every three years.
When a vacancy exists, through whatever cause, or where it is considered that the Board would benefit from
the services of a new director with particular skills, the Board will determine the selection criteria for the
position based on the skills deemed necessary for the Board to best carry out its responsibilities. The Board will
then appoint the most suitable candidate (assuming one is available) who must stand for election at the next
annual general meeting.
Performance
During the reporting year the Company did not have a formal process for evaluation of Directors and
Executives due to their only being three in total. The Board undertakes an annual review of its own
performance with external advice as appropriate.
Principle 3: Promote ethical and responsible decision making
Code of Conduct
The Directors, officers and employees of the Company are required to conduct themselves in accordance
with the Company’s Code of Conduct which can be viewed at:
www.catalystmetals.com.au/corporate_governance.
46
For personal use only
CORPORATE GOVERNANCE
Share Trading Policy
The Company also has policies concerning trading in the Company’s securities by directors, officers and
employees. This policy can be viewed at www.catalystmetals.com.au/corporate_governance.
Principle 4: Safeguard integrity of financial reporting
Audit Committee
The Board has established an audit committee charter of the Board which can be viewed at
www.catalystmetals.com.au/corporate_governance.
Given the size and scope of the operations of the Company, the full board has assumed those responsibilities
that are ordinarily assigned to an audit committee.
It is the Board’s responsibility to ensure that an effective internal control framework exists within the Company.
This includes both internal controls to deal with both the effectiveness and efficiency of significant business
processes, the safeguarding of assets, the maintenance of proper accounting records, and the reliability of
financial and non-financial information.
For details on member qualifications and attendance at meetings of the Audit Committee held during the
year refer to the Directors’ Report.
Appointment of auditor
The shareholders in a general meeting are responsible for the appointment of the external auditors of the
Company, and the Board from time to time will review the scope, performance and fees of those external
auditors.
Principle 5: Make timely and balanced disclosure
The Board has designated the Company Secretary as the person responsible for overseeing and coordinating
disclosure of information to the ASX as well as communicating with the ASX. The Company has a Continuous
Disclosure
at
www.catalystmetals.com.au/corporate_governance.
Company’s
available
website
viewing
Policy
the
for
on
Principle 6: Respect the rights of shareholders
The Board of Catalyst is committed to open and effective communication, ensuring all shareholders are
informed of all significant developments concerning the Company. The Company has in place an effective
Shareholder
at
Communications
www.catalystmetals.com.au/corporate_governance.
viewed
Policy.
policy
can
This
be
Principle 7: Recognise and manage risk
Identification and Management of Risk
The Board’s Charter clearly establishes that it is responsible for ensuring there is a good sound system for
overseeing and managing risk. Due to the size and scale of operations, risk management issues are
considered by the Board as a whole.
The Board’s collective experience will enable accurate identification of the principal risks which may affect
the Company’s business. Management of these risks will be discussed by the Board at periodic (at least
annual) strategic planning meetings. In addition, key operational risks and their management, will be
recurring items for deliberation at Board meetings.
A copy of the Company’s risk management policy can be viewed at:
www.catalystmetals.com.au/corporate_governance.
47
For personal use only
The Board has a number of mechanisms in place to ensure that management’s objectives and activities are
aligned with the risks identified by the Board. These include:
CORPORATE GOVERNANCE
•
Board receives regular updates on key risks associated with the development of the Company’s
Everton Project;
The Board will seek to develop a more extensive Risk Management Policy over the coming year, which can
then be used as a guide to be used throughout the company in identifying and communicating business risks.
The Board has received assurance from the Company Secretary and Mr Boston that the declarations made in
accordance with section 295A of the Corporation Act 2001 are:
1.
2.
founded on a sound system of risk management and internal compliance and control which
implements the policies adopted by the board
the Company’s risk management and internal compliance and control system is operating
efficiently and effectively in all material respects.
Principle 8: Remunerate fairly and responsibly
Remuneration Arrangements
A Remuneration and Nomination Committee Charter has been established by the Board to assess and make
recommendations regarding membership of the Board, including proposed new appointments.
Given the size and scope of the operations of the Company, the full board has assumed those responsibilities
that are ordinarily assigned to a remuneration and nomination committee.
Where appropriate, independent consultants are engaged to appropriate levels of remuneration
It is the company’s objective to provide maximum stakeholder benefit from the retention of a high quality
board by remunerating directors fairly and appropriately with reference to relevant employment market
conditions. To assist in achieving the objective the Board links the nature and amount of executive directors’
emoluments to the company’s financial and operational performance. The expected outcomes of this
remuneration structure are:
•
•
Retention and motivation of Directors
Performance rewards to allow Directors to share the rewards of the success of Catalyst Metals Limited
The remuneration of an executive director will be decided by the Remuneration and Nomination Committee.
In determining competitive remuneration rates the Committee reviews local and international trends among
comparative companies and the industry generally. It also examines terms and conditions for the employee
share option plan.
The maximum remuneration of non-executive Directors is the subject of shareholder resolution in accordance
with the Company’s Constitution, and the Corporations Act 2001 as applicable. The appointment of non-
executive Director remuneration within that maximum will be made by the Board having regard to the inputs
and value of the Company of the respective contributions by each non-executive Director.
The Board may award additional remuneration to non-executive Directors called upon to perform extra
services or make special exertions on behalf of the Company.
There is no scheme to provide retirement benefits, other than statutory superannuation, to non-executive
directors.
All remuneration paid to directors and executives is valued at the cost to the company and expensed.
Options are valued using the Black-Scholes methodology.
Full details regarding the remuneration of Directors, is included in the Directors’ Report.
48
For personal use only
CORPORATE GOVERNANCE
Explanation of departure
During the financial year Catalyst Metals Limited strived to comply with the 8 Essential Corporate Governance
Principles and Recommendations where appropriate for the size and nature of the Company and Industry in
which
it operates. A summary of departure from the ASX Corporate Governance Principles and
Recommendations is outlined below:
ASX
Best
Recommendation
Practice
Notification of
Departure
Explanation of Departure
2.1 & 2.2 Structure of
the Board
A majority of the
board are not
independent
directors and the
Chair does not
meet the criteria
for
Independence
The Board continues to strive to meet the principles of Good Corporate
Governance and Best Practice Recommendations published by the ASX or
other such principles and guidance as the Board may consider appropriate
form time to time, however the Board also recognises that complying with
ASX Corporate Governance Council Recommendations 2.1 and 2.2 is
impractical given the size of the company and the industry in which it
operates. The Board instead aims to assess the independence of the
Company’s non-executive Directors on an ongoing basis requiring full
disclosure where conflicts of interest arise.
The Board (subject to members’ voting rights in general meeting) is
responsible for selection of new board members and succession planning,
and has regard to a candidate’s experience and competence in areas such
as exploration, financial and administration. The wide commercial and
technical experience of Messrs Boston and Scrimgeour assists Catalyst Metals
Limited in meeting its corporate objectives and plans.
2.3 The roles of Chair
and CEO should not
be exercised by the
same individual
The role of the
Chair and CEO
are exercised by
the
same
individual
2.4 The board should
establish a
nomination
committee
The Company
has not
established a
formal
nomination
committee
4.1 & 4.2 The board
should establish an
audit committee
The
full board
assumes the role
of
audit
committee
the
8.1 The board should
a
establish
remuneration
committee
The Company
not
has
established
a
formal
remuneration
committee
The Board continues to strive to meet the principles of Good Corporate
Governance and Best Practice Recommendations published by the ASX or
other such principles and guidance as the Board may consider appropriate
form time to time, however the Board also recognises that complying with
ASX Corporate Governance Council Recommendation 2.3 is impractical
given the size of the company and the industry in which it operates. The
Directors believe,
for the Chairman to assume those
responsibilities that are ordinarily assigned to a CEO at this stage.
is sufficient
it
The Board continues to strive to meet the principles of Good Corporate
Governance and Best Practice Recommendations published by the ASX or
other such principles and guidance as the Board may consider appropriate
form time to time, however the Board also recognises that complying with
ASX Corporate Governance Council Recommendation 2.4 is impractical
given the size of the company and the industry in which it operates. The
Directors believe, it is sufficient for the full board to assume those
responsibilities that are ordinarily assigned to a remuneration and nomination
committee.
The Board continues to strive to meet the principles of Good Corporate
Governance and Best Practice Recommendations published by the ASX or
other such principles and guidance as the Board may consider appropriate
form time to time, however the Board also recognises that complying with
ASX Corporate Governance Council Recommendation 4.1 and 4.2 is
impractical given the size of the company and the industry in which it
operates. The Directors believe, it is sufficient for the full board to assume
those responsibilities that are ordinarily assigned to an audit committee.
The Board continues to strive to meet the principles of Good Corporate
Governance and Best Practice Recommendations published by the ASX or
other such principles and guidance as the Board may consider appropriate
form time to time, however the Board also recognises that complying with
ASX Corporate Governance Council Recommendation 8.1 is impractical
given the size of the company and the industry in which it operates. The
is sufficient for the full board to assume those
Directors believe,
responsibilities that are ordinarily assigned to a remuneration and nomination
committee.
it
49
For personal use only
ADDITIONAL INFORMATION
Additional information required by Australian Stock Exchange Limited and not shown elsewhere in this
Annual Report is as follows. The information is made up to 15 September 2009.
DISTRIBUTION OF SHAREHOLDERS
Analysis of numbers of equity security holders by size of holding
Fully Paid Ordinary Shares
1-1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 and over
Holding less than a
marketable parcel
4
53
74
220
38
389
60
TWENTY LARGEST SHAREHOLDERS
The names of the twenty largest quoted equity security holders are:
Ordinary Shares
Number Held
1
2.
3.
4.
5.
6.
7.
8.
9.
Equity West Ltd
Caudle Gavin
Chepalix Pty Ltd
Robin Scrimgeour
Lateral Minerals Pty Ltd
Dawson Howard
Jodie Marwick
Teagle Kenneth Raymond
Mining Tenement Management Pty Ltd
10. Widerange Corp Pty Ltd
11.
12.
13.
14.
15.
Kingsreef Pty Ltd
Drill Investments Pty Ltd
Vestcourt Pty Ltd
Edwards Sandra Louise
Kingsreef Pty Ltd
16. Mark James Thompson
17.
18.
19.
CP McLoughlin S/F
Canaccord Cap Aust Pty Ltd
David John Sharp
20. Mimosa Nom Pty Ltd
3,388,094
1,250,000
1,100,000
1,100,000
1,000,020
970,012
935,016
925,000
600,000
534,545
500,000
500,000
500,000
470,002
400,000
265,250
265,000
257,000
255,000
250,000
% Held
12.51
4.61
4.06
4.06
3.69
3.58
3.45
3.41
2.21
1.97
1.85
1.85
1.85
1.74
1.48
0.98
0.98
0.95
0.94
0.92
15,464,939
57.09
50
For personal use only
ASX ADDITIONAL INFORMATION (continued)
UNQUOTED EQUITY SECURITIES
There are no unquoted securities as at 15 September 2009
SUBSTANTIAL SHAREHOLDERS
Ordinary shareholders
Number
Percentage
Fully Paid
Equity West Limited
3,388,094
12.51
VOTING RIGHTS
a)
Ordinary Shares
On a show of hands, every member present in person or by proxy shall have one vote and,
upon a poll, each share shall have one vote.
TAX STATUS
The Company is treated as a public company for taxation purposes.
FRANKING CREDITS
The Company has nil franking credits.
TENEMENT SCHEDULE
Project
Eudamullah
Michelles Well
Bluebush Well
Everton
Wanna
Competent Persons Statement
Tenements
E09/1174
E09/1291
E09/1303
EL4866
E09/1619
Interest
90%
90%
90%
10%
Application
The information in the directors report that relates to Exploration Results has been compiled by
an independent consultant Dylan Jeffriess, B.Sc (Hons) Geol.(MAIG, MSEG). This report has been
reviewed by independent consultant Dylan Jeffriess, who has sufficient experience which is relevant to
the style of mineralization and type of deposit under consideration and to the activity to which he is
undertaking, and consents to the inclusion in the public release of the matters based on their
information in the form and context in which it appears.
51
For personal use only