ABN 54 118 912 495
ANNUAL REPORT AND FINANCIAL STATEMENTS
YEAR ENDED 30 JUNE 2010
CATALYST METALS LIMITED
CONTENTS
PAGE
CORPORATE DIRECTORY
CHAIRMAN’S REPORT
DIRECTORS’ REPORT
AUDITOR’S INDEPENDENCE DECLARATION
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
CONSOLIDATED STATEMENT OF CASH FLOWS
NOTES TO THE FINANCIAL STATEMENTS
DIRECTORS’ DECLARATION
INDEPENDENT AUDIT REPORT
CORPORATE GOVERANCE STATEMENT
ADDITIONAL INFORMATION
2
3
4
11
12
13
14
15
16
39
40
42
46
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
1
CATALYST METALS LIMITED
CORPORATE DIRECTORY
DIRECTORS
AUDITORS
Stephen Boston (Non-Executive Chairman)
Robin Scrimgeour (Non-Executive Director)
Gary Schwab (Non-Executive Director)
RSM Bird Cameron Partners
8 St Georges Terrace
Perth WA 6000
COMPANY SECRETARY
Frank Campagna
REGISTERED OFFICE AND PRINCIPAL PLACE OF
BUSINESS
18 Emerald Terrace
West Perth, Western Australia 6005
Telephone: +618 9383 2825
+618 9284 5426
Facsimile:
admin@catalystmetals.com.au
Email:
www.catalystmetals.com.au
Website:
SHARE REGISTRY
Security Transfer Registrars Pty Ltd
770 Canning Hwy
Applecross WA 6153
Telephone: +618 9315 2333
+618 9315 2233
Facsimile:
registrar@securitytransfer.com.au
Email:
www.securitytransfer.com.au
Website:
STOCK EXCHANGE LISTING
The Company is listed on ASX Limited
Home Exchange – Perth
ASX code: CYL
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
2
CATALYST METALS LIMITED
CHAIRMAN’S REVIEW
Dear Shareholders
During the past 12 months the Company initiated a number of changes to the board; conducted a
number of recapitalisations of the company (via placement) at a premium to market; secured tenure
over it’s two major projects; continued to reduce corporate and administrative overheads; and
evaluated a number of new opportunities.
In September 2009 Nathan McMahon, Bryan Dixon and Mark Thompson resigned from the Board and
were replaced by Steve Boston, Robin Scrimgeour and Gary Schwab who joined in December 2009. Mr
Frank Campagna was appointed as Company Secretary on 20 November 2009 following the
resignation of Ms Lisa Wynne.
During the year the company raised a total of $653,000 in equity funds through a private placement of
3,530,000 ordinary shares at a subscription price of 10 cents per share in July 2009 and a private
placement of 3,000,000 ordinary shares at a subscription price of 10 cents per share in December 2009.
Both these capital raisings were conducted at a premium to the prevailing market price of the
Company’s shares.
In September 2009 the Company announced that it had entered into an agreement to acquire a 100%
interest in the tenements containing the Everton Molybdenum Project. Under the terms of the
agreement, the consideration payable to the vendor comprised $40,000 cash and 500,000 fully paid
shares and the Company replacing the vendor’s tenements work bond of $10,000. This acquisition was
completed in December 2009 following the approval of shareholders at the annual general meeting of
the Company held on 20 November 2009. Registration of the Company’s 100% beneficial interest in the
Everton tenement (via a wholly owned subsidiary) was completed during the June 2010 quarter. An
extension of the term of the license for a further five years was granted by the Victorian Department of
Primary Industries in June 2010.
During the year the Company continued to advance work on the Minnie Creek project. Work
undertaken focused on statutory reporting, tenement rationalisation and a review of project data and
strategies. Results of the data review highlighted multiple targets some of which are located along strike
from the Minnie Springs prospect that remain untested and require further work.
The board retained the services of a very experienced technical consultant during the year who will
assist and advise the Board with regards to its current projects and any new opportunities.
I would like to welcome all the new shareholders who joined the register during the year as well as the
original shareholders who have continued to support the Company.
As all shareholders are aware - your Board is committed to adding value for the benefit of all
shareholders. On behalf of the Board I would like to thank shareholders, directors and consultants for
their continued support.
Stephen Boston
Chairman
29 September 2010
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
3
CATALYST METALS LIMITED
DIRECTORS’ REPORT
The Directors of Catalyst Metals Limited present their report on the consolidated entity for the year
ended 30 June 2010.
DIRECTORS
The names of the Directors in office at any time during or since the end of the financial year are:
Stephen Boston
Robin Scrimgeour
Gary Schwab
Nathan McMahon
Bryan Dixon
Mark Thompson
(appointed on 1 September 2009)
(appointed on 1 September 2009)
(appointed on 8 December 2009)
(resigned on 1 September 2009)
(resigned on 1 September 2009)
(resigned on 25 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
Frank Campagna
CORPORATE STRUCTURE
Catalyst Metals Limited is a company limited by shares that is incorporated and domiciled in Australia.
PRINCIPAL ACTIVITIES
The principal activity of the Company during the financial year was mineral exploration and evaluation.
There was no significant change in the nature of the activities during the year.
RESULTS OF OPERATIONS
The operating loss after income tax of the Group for the year ended 30 June 2010 was $223,171 (2009:
$1,514,626).
DIVIDENDS
No dividend has been paid during or is recommended for the financial year ended 30 June 2010.
REVIEW OF OPERATIONS
During the year Catalyst continued to advance work on the Minnie Creek and Everton Molybdenum
projects plus review a number of new commercial opportunities.
Minnie Creek Project (Western Australia)
At the Minnie Creek Project located in Western Australia work during the year focused on tenement
rationalisation, review of project data and refinement of the Company’s exploration plan. No field
activities were completed in 2010 whilst this work was being undertaken.
An application submitted with the Western Australian Department of Mines and Petroleum for an
extension of exploration license 09/1174 was formally granted on 29 March 2010 for a further period of
two years. This exploration licence contains the Minnie Springs Prospect where exploration completed
to date has intersected highly encouraging broad zones of molybdenum mineralization associated with
a previously unrecognised intrusive hosted ferroalloy bearing mineral system.
Previous drilling by the Company returned a 61 metre intersection from 3 metres of 0.09% molybdenum
(equivalent to 0.15% MoS2). This includes a 5 metre intersection from 11 metres grading 0.23%
molybdenum (0.38% MoS2). High grades of molybdenum identified north of the drilled area in pyritic
veins returned grades of 0.04% molybdenum and 0.04% tungsten.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
4
CATALYST METALS LIMITED
DIRECTORS’ REPORT
REVIEW OF OPERATIONS (CONTINUED)
Catalyst continued to review the Minnie Creek project tenement holdings to reduce expenditure
commitments whilst retaining the most prospective areas for further work and / or potential joint
venture.
During the March 2010 quarter a voluntary partial surrender of areas deemed unprospective, located
within exploration licence 09/1303 was undertaken. A new exploration licence application (09/1776)
was lodged with the Department of Mines and Petroleum in April 2010. The application consolidated
the Company’s land position by forming a near contiguous 70km long tenure over the Minnie Springs
district by joining three existing tenements.
Everton Molybdenum Project (Victoria)
At the Everton Molybdenum Project located in Victoria, work plan approvals were received from the
Victorian Department of Primary Industries for a diamond and percussion drilling program designed to
test the economic potential of the historic Everton Molybdenum mine.
However, this work program was deferred when Catalyst entered into an agreement to acquire the
remaining vendor interest in the exploration licence EL4866, to give Catalyst a 100% interest in the
project. The deferral was required pending registration of the ownership interest of the tenement being
transferred into Catalyst’s wholly owned subsidiary.
The consideration payable for the acquisition of the remaining interest comprised a $40,000 cash
payment, the issue of 500,000 ordinary fully paid shares in the Company and Catalyst replacing the
vendor’s tenement works bond of $10,000.
After an application was made to the Victorian Department of Primary Industries an extension of the
term of EL4866 for a further five years was granted in June 2010.
SIGNIFICANT CHANGES IN STATE OF AFFAIRS
Significant changes in the state of affairs of the Group during the financial year were as follows:
(a)
In September 2009, the Company acquired the remaining vendor interest in the Everton project
for a consideration comprising $40,000 in cash, the issue of 500,000 shares in the Company and
the replacement of the tenement works bond.
(b) During the year the Company raised $653,000 in equity funds through a private placement of
3,530,000 ordinary shares at a subscription price of 10 cents per share in July 2009 and a private
placement of 3,000,000 ordinary shares at a subscription price of 10 cents per share in December
2009.
FUTURE DEVELOPMENTS
During the course of the next financial year, the Group will continue its mineral exploration activities and
will investigate additional resources projects in which the Group may participate.
In the opinion of the Directors there is no additional information available as at the date of this Group
and the expected results of those operations in subsequent years.
SUBSEQUENT EVENTS
On 2 July 2010 a General Meeting of shareholders approved the following resolutions:
•
Ratified the placement made in December 2009 of 3 million ordinary shares at 10 cents each ;
• Authorised the issue of options under the Catalyst Metals Limited Employee Share Option Plan; and
• Approved the issue of 1,500,000 unlisted options to consultants of the Company.
On 12 July 2010, 500,000 unlisted options were issued under the Employee Share Option Plan.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
5
CATALYST METALS LIMITED
DIRECTORS’ REPORT
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:
Chairman
Other Directorships:
None
Interests in shares and options: Direct:
Indirect:
Nil
3,819,628 Ordinary Shares (held by Trapine Pty Ltd, a
company in which Mr Boston holds a relevant interest)
Robin Scrimgeour (Non-Executive Director)
Mr Scrimgeour spent 17 years working 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:
Member of audit committee.
Other Directorships:
None
Interests in shares and options: Direct:
1,870,561 Ordinary Shares
Indirect: Nil
Gary Schwab (Non-Executive Director)
Mr Schwab is a Certified Practicing Accountant with over 40 years of business experience, including 20
years in the resources sector. Mr Schwab was previously Executive Director for a privately owned
commodities group. In that role, Mr Schwab was responsible for managing a long term wealth creation
strategy (in conjunction with the principal and owner) which culminated in the creation of what is
currently one of Australia’s wealthiest unlisted private commodities companies.
Special Responsibilities:
Chairman of audit committee.
Other Directorships:
None
Interests in shares and options: Direct:
Nil
Indirect: Nil
Information on Company Secretary
Frank Campagna B.Bus (Acc), CPA
Company Secretary of Catalyst Metals Limited since November 2009. Mr Campagna is a Certified
Practising Accountant with over 20 years experience as a Company Secretary, Financial Controller and
Commercial Manager for listed resources and industrial companies. He currently operates a corporate
consultancy practice which provides corporate secretarial services to both listed and unlisted
companies.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
6
CATALYST METALS LIMITED
DIRECTORS’ REPORT
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
Stephen Boston (appointed on 1 September 2009)
Robin Scrimgeour (appointed on 1 September 2009)
Gary Schwab (appointed on 8 December 2009)
Mark Thompson (resigned on 25 September 2009)
Bryan Dixon (resigned on 1 September 2009)
Nathan McMahon (resigned on 1 September 2009)
6
6
4
3
2
2
6
5
4
3
2
2
-
1
1
-
-
-
-
1
1
-
-
-
ENVIRONMENTAL REGULATIONS
The Group is subject to significant environmental regulation in respect to its mineral exploration
activities. These obligations are regulated under relevant government authorities within Australia and
overseas. The Group is a party to exploration and mining licences. Generally, these licences and
agreements specify the environmental regulations applicable to exploration and mining operations in
the respective jurisdictions. The Group aims to ensure that it complies with the identified regulatory
requirements in each jurisdiction in which it operates.
Compliance with environmental obligations is monitored by the Board of Directors. No environmental
breaches have been notified to the Group by any government agency during the year ended 30 June
2010.
The Company’s operations are subject to State and Federal laws and regulation concerning the
environment.
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 2,000,000 unissued ordinary shares under option. The terms of
these options are as follows:
Options over ordinary fully paid shares exercisable:
- at 20 cents each on or before 30 June 2014
- at 30 cents each on or before 30 June 2015
Number
1,000,000
1,000,000
2,000,000
No person entitled to exercise the options has any right by virtue of the option to participate in any
share issue of the parent entity or any other corporation.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
7
CATALYST METALS LIMITED
DIRECTORS’ REPORT
REMUNERATION REPORT
This report sets out the current remuneration arrangements for directors and executives of the Group.
For the purposes of this report, key management personnel is defined as those persons having authority
and responsibility for planning, directing and controlling major activities of the Group, including any
director of the Company, and includes the executives in the consolidated entity receiving the highest
remuneration. The information provided in this report includes remuneration disclosures that are required
under Accounting Standard AASB 124 Related Party Disclosures.
Principles used to determine the nature and amount of remuneration
Directors and executives remuneration
Overall remuneration policies are determined by the Board and are adapted to reflect competitive
market and business conditions. Within this framework, the Board considers remuneration policies and
practices generally, and determines specific remuneration packages and other terms of employment
for any executive directors and senior management. Executive remuneration and other terms of
employment are reviewed annually by the Board having regard to performance, relevant comparative
information and expert advice.
The Company’s remuneration policy for any executive directors and senior management is designed to
promote superior performance and long term commitment to the Company. Remuneration packages
are set at levels that are intended to attract and retain executives capable of managing the
Company’s operations. Executive directors and senior executives receive a base remuneration which is
market related, together with performance based remuneration linked to the achievement of pre-
determined milestones and targets.
The Company’s
remuneration with
shareholders’ interests and to retain appropriately qualified executive talent for the benefit of the
Company. The main principles of the policy are:
remuneration policies are designed to align executives’
-
-
reward reflects the competitive market in which the Company operates; and
individual reward should be linked to performance criteria.
The structure of remuneration packages for any executive directors and other senior executives
comprises:
- a fixed sum base salary plus superannuation benefits;
-
short term incentives through eligibility to participate in a performance bonus scheme if deemed
appropriate; and
long term incentives through any executive directors being eligible to participate in share option
schemes with the prior approval of shareholders.
-
Fixed and variable remuneration is established for each executive director by the Board. The objective
of short term incentives is to link achievement of the Company’s operational targets with the
remuneration received by executives charged with meeting those targets.
The objective of long term incentives is to reward executives in a manner which aligns this element of
their remuneration with the creation of shareholder wealth.
Performance incentives may be offered to any executive directors and senior management through
the operation of performance bonus schemes. A performance bonus, based on a percentage of
annual salary, may be payable upon achievement of agreed operational milestones and targets.
Non-executive directors’ remuneration
In accordance with current corporate governance practices, the structure for the remuneration of non-
executive directors and senior executives is separate and distinct. Shareholders approve the maximum
fees payable to non-executive directors, with the current approved limit being $200,000 per annum.
The Board is responsible for determining actual payments to directors. Non-executive directors are
entitled to statutory superannuation benefits.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
8
CATALYST METALS LIMITED
DIRECTORS’ REPORT
REMUNERATION REPORT (CONTINUED)
Non-executive directors may be entitled to participate in equity based remuneration schemes.
Shareholders must approve the framework for any equity based compensation schemes and if a
recommendation is made for a director to participate in an equity scheme, that participation must be
specifically approved by the shareholders.
All directors are entitled to have premiums on indemnity insurance paid by the Company
Details of Remuneration for Year Ended 30 June 2010
Details of the remuneration for each director and key management personnel (as defined in AASB 124
Related Party Disclosures) of the Company during the year are set out in the following tables.
2010
Name
Short-term employment
benefits
Cash salary
and fees
Other
Post-
employment
benefits
Superannuation
Share-based
payments
Options
Total
Non-executive directors
B Dixon
N McMahon
M Thompson
S Boston
R Scrimgeour
G Schwab
Total key management
personnel compensation
7,500
9,417
7,500
15,000
16,350
18,500
74,267
-
-
-
-
-
-
-
-
-
-
1,350
-
-
1,350
-
-
-
-
-
-
-
7,500
9,417
7,500
16,350
16,350
18,500
75,617
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
N McMahon
M Thompson
Total key management
personnel compensation
30,000
37,500
30,000
-
-
54,535
97,500
54,535
-
-
-
-
-
-
-
-
30,000
37,500
84,535
152,035
Letters of appointment have been entered into with each director of the Company. No duration of
appointment or termination benefits are applicable. Non-executive directors receive remuneration of
$30,000 plus statutory superannuation.
The company secretary is deemed to be an executive by virtue of being an officer of the parent entity.
The role performed by the company secretary does not meet the definition of key management person
under AASB 124, hence this officer has been excluded from the key management personnel disclosures
in the financial report.
The company secretary has an agreement on normal commercial terms for the provision of services at
the rate of $3,500 per month.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
9
CATALYST METALS LIMITED
DIRECTORS’ REPORT
SHARE-BASED COMPENSATION
Options over shares in the Company are granted under the Catalyst Metals Limited Employee Share
Option Plan (Plan). The purpose of the Plan is to provide employees, directors, executive officers and
consultants with an opportunity, in the form of options, to subscribe for ordinary shares in the Company.
The Directors consider the Plan enables the Company to retain and attract skilled and experienced
employees, board members and executive officers and provide them with the motivation to contribute
to the growth and future success of the Company.
No options were issued during the financial year.
INDEMNIFICATION AND INSURANCE OF DIRECTORS AND OFFICERS
The Company has entered into indemnity agreements with each of the directors and officers of the
Company. Under the agreements, the Company will indemnify those officers against any claim or for
any expenses or costs which may arise as a result of work performed in their respective capacities as
officers of the Company or any related entities.
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 any
non-audit services 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 2010.
AUDITOR’S INDEPENDENCE DECLARATION
The lead auditor’s independence declaration for the year ended 30 June 2010 has been received and
immediately follows the Directors’ Report.
This report is made in accordance with a resolution of the Directors.
Stephen Boston
Chairman
Perth, Western Australia
29 September 2010
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
10
CATALYST METALS LIMITED
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 30 June 2010
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
2010
$
2009
$
6
7
8
9
10
1,773,365
1,415,701
22,927
120
58,564
1,368
1,796,412
1,475,633
12,585
8,516
275,277
162,294
287,862
170,810
TOTAL ASSETS
2,084,274
1,646,443
Current Liabilities
Trade and other payables
Total Current Liabilities
TOTAL LIABILITIES
NET ASSETS
Equity
Contributed equity
Share-based payments reserve
Accumulated losses
11
60,580
68,323
60,580
68,323
60,580
68,323
2,023,694
1,578,120
12
13
13
4,025,455
3,356,710
82,609
82,609
(2,084,370)
(1,861,199)
TOTAL EQUITY
2,023,694
1,578,120
The above Consolidated Statement of Financial Position should be read in conjunction with the
accompanying notes.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
12
CATALYST METALS LIMITED
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the Year Ended 30 June 2010
Revenue
Expenses
Occupancy costs
Professional fees
Administration costs
Personnel
Corporate
Exploration costs written off
Other
Loss before income tax expense
Income tax expense
Loss for the year
Other comprehensive income
Total comprehensive loss for the year
Total comprehensive income attributable to
members of the company
Basic loss per share (cents per share)
Diluted loss per share (cents per share)
Note
2010
$
2009
$
2
71,545
120,339
(8,505)
(64,006)
(26,712)
(75,617)
(70,462)
(22,448)
(14,288)
(54,197)
(90,000)
(67,307)
(49,414)
(1,384,933)
-
(1,792)
(223,171)
(1,514,626)
-
-
(223,171)
(1,514,626)
-
-
(223,171)
(1,514,626)
(223,171)
(1,514,626)
(0.8 cents)
(6.4 cents)
(0.8 cents)
(6.4 cents)
3
5
4
4
The above Consolidated Statement of Comprehensive Income should be read in conjunction with the
accompanying notes.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
13
CATALYST METALS LIMITED
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the Year Ended 30 June 2010
Issued
Capital
$
Accumulated
losses
$
Share-based
payments
reserve
$
Total
$
Balance at 30 June 2008
3,356,710
(346,573)
82,609
3,092,746
Total comprehensive
loss for the year
Balance at 30 June 2009
Total comprehensive
loss for the year
Transactions with owners
in their capacity as
owners:
Issue of shares
Share issue expenses
-
3,356,710
(1,514,626)
(1,861,199)
-
82,609
(1,514,626)
1,578,120
-
(223,171)
703,000
(34,255)
-
-
-
(223,171)
703,000
(34,255)
Balance at 30 June 2010
4,025,455
(2,084,370)
82,609
2,023,694
The above Consolidated Statement of Changes in Equity should be read in conjunction with the
accompanying notes.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
14
CATALYST METALS LIMITED
CONSOLIDATED STATEMENT OF CASH FLOWS
For the Year Ended 30 June 2010
Cash Flows from Operating Activities
Payments for exploration and evaluation
Payments to suppliers, contractors and employees
Interest received
Proceeds from R&D tax offset
Note
2010
$
2009
$
(90,910)
(399,307)
(226,851)
(199,958)
72,164
32,885
84,912
-
Net cash flows used in operating activities
14
(212,712)
(514,353)
Cash Flows from Investing Activities
Payments for property, plant and equipment
Proceeds from sale of property, plant and equipment
Payments for exploration property
Proceeds from sale of financial assets
(12,680)
2,011
(324)
-
(40,000)
(97,741)
2,300
-
Net cash flows used in investing activities
(48,369)
(98,065)
Cash Flows from Financing Activities
Proceeds from issue of shares and other equity securities
Share issue expenses
Net cash flows from financing activities
653,000
(34,255)
618,745
-
-
-
Net decrease in cash and cash equivalents
357,664
(612,418)
Cash and cash equivalents at the beginning of the
financial year
1,415,701
2,028,119
Cash and cash equivalents at the end of the financial year
6
1,773,365
1,415,701
The above Consolidated Statement of Cash Flows should be read
accompanying notes.
in conjunction with the
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
15
CATALYST METALS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2010
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 by the Directors on the
date of signing of the Directors’ Report.
(b)
Basis of preparation
The financial report covers Catalyst Metals Limited, which is a listed public company,
incorporated and domiciled in Australia and its subsidiary Silkfield Holding Pty Ltd.
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) Consolidation
A controlled entity is any entity Catalyst Metals Limited has the power to control the financial and
operating policies so as to obtain benefits from its activities.
All inter-company balances and transactions between entities in the consolidated entity,
including any unrealised profits or losses, have been eliminated on consolidation. Accounting
policies of subsidiary have been changed where necessary to ensure consistencies with those
policies applied by the parent entity.
Where controlled entities have entered or left the consolidated entity during the year, their
operating results have been included/ excluded from the date control was obtained or until the
date control ceased.
(d)
Revenue
Interest revenue is recognised on a proportional basis taking into account the interest rates
applicable to the financial assets.
(e)
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.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
16
CATALYST METALS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2010
1.
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(f)
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.
(g)
Trade and other receivables
Trade receivables, loans, and other receivables are recorded at amortised cost less impairment.
(h)
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.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
17
CATALYST METALS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2010
1.
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(h)
Financial instruments (continued)
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.
(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.
(i)
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.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
18
CATALYST METALS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2010
1.
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(i)
Exploration and Evaluation Expenditure (continued)
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.
(j)
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.
(k)
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.
(l)
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.
(m)
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.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
19
CATALYST METALS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2010
1.
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(m)
Income tax (continued)
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.
(n)
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.
(o)
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.
(p)
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.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
20
CATALYST METALS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2010
1.
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(q) 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.
(r)
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.
(s)
Adoption of New and Revised Accounting Standards
The consolidated entity has adopted the following new and revised Australian Accounting
Standards issued by the AASB which are mandatory to apply to the current financial year.
Disclosures required by these Standards that are deemed material have been included in this
financial report on the basis that they represent a significant change in information from those
previously made available.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
21
CATALYST METALS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2010
1.
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(s)
Adoption of New and Revised Accounting Standards (continued)
(i) Presentation of Financial Statements
The consolidated entity has applied the revised AASB 101 Presentation of Financial Statements
(2007) from 1 January 2009. The revision of this standard now requires the consolidated entity to
present all non-owner changes to equity (comprehensive income) in the statement of
comprehensive income. The consolidated entity has presented the income statement and non-
owner changes in equity in one statement of comprehensive income. All owner changes in
equity are presented separately in the statement of changes in equity.
The presentation requirements have been applied for the entire reporting period and
comparative information has been represented to also comply with the revised AASB 101.
(ii) Segment Reporting
The consolidated entity has applied AASB 8 Operating Segments with effect from 1 July 2009.
AASB 8 requires the entity to identify operating segments and disclose segment information on
the basis of internal reports that are provided to, and reviewed by, the chief operating decision
maker of the consolidated entity to allocate resources and assess performance. In the case of
the consolidated entity, the chief operating decision maker is the Board of Directors. Operating
segments now represent the basis on which the company reports its segment information to the
Board on a monthly basis. The change in policy has not resulted in a change to the disclosure
presented.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
22
CATALYST METALS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2010
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(i))
Depreciation
Project costs
(Gain)/loss on fair value of other financial assets
4.
Earnings per Share
2010
$
2009
$
70,493
1,052
71,545
87,454
32,885
120,339
75,617
49,414
6,601
-
-
97,500
1,384,933
7,741
97,740
1,792
2010
No. of Shares
2009
No. of Shares
Weighted average number of ordinary shares for basic and
diluted earnings per share
28,678,822
23,558,137
(i)
In 2009 diluted earnings per share were calculated after classifying all options on issue
remaining unconverted at 30 June 2009 as potential ordinary shares. As at 30 June
2009, the Company had 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. As at 30 June
2010, there were no options over unissued capital outstanding.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
23
CATALYST METALS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2010
5.
Income tax
Loss before tax
Prima facie tax on operating loss before income
tax at 30%
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
Net unrecognised deferred tax asset at 30%
2010
$
2009
$
(223,171)
(1,514,626)
(66,951)
(454,387)
(15,582)
-
(9,516)
-
82,353
463,903
-
-
2,416,457
(194,478)
2,221,979
666,594
2,038,738
(34,083)
2,015,741
604,722
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
Sundry debtors
2010
$
2009
$
1,773,365
1,415,701
22,927
58,564
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 2010
24
CATALYST METALS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2010
2010
$
2009
$
8.
Financial assets at fair value through profit or loss
Current
Securities in listed corporations - at fair value
120
1,368
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
$
Year ended 30 June 2010
Opening net book amount 1 July 2009
Additions
Disposals
Depreciation charge
Closing net book amount 30 June 2010
At 30 June 2010
Cost or fair value
Accumulated depreciation
Net book amount
2,636
12,680
-
(2,913)
12,403
20,092
(7,689)
12,403
10.
Exploration and evaluation expenditure
Opening balance
Additions
Total
$
8,516
12,680
(2,011)
(6,600)
12,585
5,880
-
(2,011)
(3,687)
182
11,572
(11,390)
182
31,664
(19,079)
12,585
2010
$
162,294
162,397
2009
$
1,086,761
460,466
Exploration written off (refer note 1(i))
(49,414)
(1,384,933)
Closing balance
275,277
162,294
11.
Trade and other payables
Current Payables
Trade creditors
Accruals
46,855
13,725
60,580
28,323
40,000
68,323
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 2010
25
CATALYST METALS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2010
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 2008
Transfer from option reserve
Balance at 30 June 2009
Issue of shares
Issue of shares –
Everton acquisition
Issue of shares –
Incentive shares converted
Share issue expenses
2010
Number
2010
$
2009
Number
2009
$
(c)
(d)
(e)
(f)
30,588,226
4,025,455
23,558,137
3,348,710
-
-
-
-
4,000,000
4,000,000
4,000
4,000
30,588,226
4,025,455
31,558,137
3,356,710
-
-
-
-
-
1,050,000
-
-
4,025,455
3,356,710
Number of
Shares
23,558,137
-
23,558,137
6,530,000
Issue
Price
$
3,249,407
99,303
3,348,710
$0.10
653,000
500,000
$0.10
50,000
89
-
-
8,000
(34,255)
4,025,455
Balance at 30 June 2010
30,558,226
(d) Movements in Incentive Shares
Details
Balance at 30 June 2008
Lapsed shares
Balance at 30 June 2009
Converted into ordinary shares
Balance at 30 June 2010
Number of
Shares
8,000,000
Issue
Price
-
-
8,000,000
(8,000,000)
-
$
8,000
-
8,000
(8,000)
-
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
26
CATALYST METALS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2010
12.
Contributed Equity (continued)
(e) Movements in other equity
securities
Details
Listed Options
Balance at 30 June 2008
Lapsed options
Balance at 30 June 2009
Lapsed options
Balance at 30 June 2010
(f) Movements in other equity
securities
Details
Unlisted Options
Number of
Options
Issue
Price
$
11,152,500
(11,152,500)
99,303
(99,303)
-
-
-
-
Number of
Options
Issue
Price
-
-
-
$
-
-
-
-
-
Balance at 30 June 2008
1,050,000
Lapsed options
Balance at 30 June 2009
Lapsed options
Balance at 30 June 2010
-
-
1,050,000
(1,050,000)
-
(g) 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.
(h) Incentive Shares
Class A Incentive Shares
•
The Class A Incentive shares were a separate class of shares that were convertible into
ordinary shares. They did not carry any voting rights in the company or rights to
participate in new issues (whether bonus or rights) in the Company.
•
Each incentive share could 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 did not occur, within 3 years from the date the Company’s ordinary shares
were 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). As none of the conversion conditions was satisfied on 27 July 2009
these Class A Incentive Shares converted to 44.5 ordinary fully paid shares.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
27
CATALYST METALS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2010
12.
Contributed Equity (continued)
(h) Incentive Shares (continued)
Class B Incentive Shares
•
The Class B Incentive shares were a separate class of shares that were convertible into
ordinary shares. They did not carry any voting rights in the company or rights to
participate in new issues (whether bonus or rights) in the Company.
•
Each incentive share could 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 did not occur, within 3 years from the date the Company’s ordinary shares
were 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. As none of the conversion conditions was satisfied on 27 July 2009 these
Class B Incentive Shares converted to 44.5 ordinary fully paid shares.
(i) Options
Unlisted Executive Options
These options that entitled the holders to subscribe for fully paid ordinary shares in the Company
expired on 16 July 2009.
(j) 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 2010 and no dividends are expected to be paid in 2011.
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.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
28
CATALYST METALS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2010
12.
Contributed Equity (continued)
(k) Details of subsidiaries
Details of the Company’s subsidiaries at 30 June 2010 are:
Name of subsidiary
Principal activity
Place of
incorporation and
operation
Proportion of
ownership interest
and voting power
held
Silkfield Holdings Pty Ltd
Mineral Exploration
Australia
100%
Silkfield Holdings Pty Ltd was incorporated on 31 August 2009.
13.
Reserves & Accumulated Losses
(a)
Reserves
Share-based payments reserve
Balance at the beginning of the year
Share balance payments expense
Balance at the end of the year
2010
$
82,609
-
82,609
2009
$
82,609
-
82,609
The share-based payments reserve records the value of share options issued by the Company.
(b)
Accumulated losses
Balance at the beginning of the year
Loss for the year
Balance at the end of the year
(1,861,199)
(223,171)
(2,084,370)
(346,573)
(1,514,626)
(1,861,199)
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
29
CATALYST METALS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2010
14.
Notes to the Cash Flow Statement
(a) Reconciliation of net cash used in operating activities
to operating loss after income tax
2010
$
2009
$
Operating loss after tax
(223,171)
(1,514,626)
Add non cash items:
Depreciation
(Gain)/loss on fair value of other financial assets
Exploration written off
Changes in net assets and liabilities
Increase/(decrease) in receivables
Increase/(decrease) in payables
(Increase) in exploration
6,601
(1,052)
(49,414)
125,636
(7,742)
(63,570)
7,741
1,792
1,384,933
(34,170)
31,597
(391,620)
Net cash outflow from operating activities
(212,712)
(514,353)
(b) Non-cash financing and investing activities
The Company did not have any non-cash financing or investing activities during the year
(2009: Nil), other than the acquisition of 100% of the Everton Molybdenum project by the
payment of $50,000 in ordinary fully paid shares.
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
S Boston
R Scrimgeour
G Schwab
N McMahon
M Thompson
B Dixon
Non-Executive Chairman (appointed 1 September 2009)
Non-Executive Director (appointed 1 September 2009)
Non-Executive Director (appointed 8 December 2009)
Non-Executive Chairman (resigned 1 September 2009)
Non-Executive Director (resigned 25 September 2009)
Non-Executive Director (resigned 1 September 2009)
All of the above persons were also key management persons during the year ended 30 June
2010.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
30
CATALYST METALS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2010
15.
Key Management Personnel Compensation (continued)
(b)
Key management personnel remunerations
Short-term employee benefits
Post-employment benefits
Share based payments
2010
105,669
1,350
-
107,019
2009
169,565
-
-
169,565
Detailed remuneration disclosures have been transferred to the Remuneration Report section of
the Director’s Report.
(c)
(i)
(ii)
Equity instrument disclosures relating to key management personnel
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 section 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:
2010
Directors
S Boston
R Scrimgeour
G Schwab
Balance at
beginning of
year
-
-
-
M Thompson (i)
1,050,000
B Dixon
N McMahon
-
-
Granted as
compensation
Exercised
Other
changes (i)
Balance at
end of year
Vested and
exercisable
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(1,050,000)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(i) 1,050,000 unlisted options expired on 16 July 2009.
2009
Directors
Balance at
beginning of
year
Granted as
compensation
Exercised
Other
changes (i)
Balance at
end of year
Vested and
exercisable
M Thompson
1,595,000
B Dixon
N McMahon
-
-
-
-
-
-
-
-
(545,000)
1,050,000
1,050,000
-
-
-
-
-
-
(i) 545,000 listed options expired on 31 December 2008.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
31
CATALYST METALS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2010
15.
Key Management Personnel Compensation (continued)
(c)
Equity instrument disclosures relating to key management personnel (continued)
(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.
2010
Directors
S Boston
R Scrimgeour
G Schwab
M Thompson
B Dixon
N McMahon
Balance at
beginning of year
Purchased
Other changes
(i)
Balance at
end of year
-
-
-
1,265,250
-
900,000
431,534
770,561
-
-
-
-
3,388,094
1,100,000
-
(1,265,250)
-
(900,000)
3,819,628
1,870,561
-
-
-
-
(i) This represents the shares held by Messrs Thompson and McMahon when they resigned as
directors of the Company and the shares held by Messrs Boston and Scrimgeour when they
were appointed as directors of the Company.
2009
Directors
M Thompson
Bryan Dixon
Nathan McMahon
Balance at
beginning of year
Purchased
Other changes
1,265,250
-
900,000
-
-
-
-
-
-
Balance at
end of year
1,265,250
-
900,000
(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:
2010
Directors
S Boston
R Scrimgeour
G Schwab
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 (i)
1,000,000
(1,000,000)
B Dixon
N McMahon
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,000,000
(1,000,000)
-
-
-
-
-
-
-
-
-
-
(i) On 27July 2009, the incentive shares lapsed and converted to 89 ordinary fully paid shares.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
32
CATALYST METALS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2010
15.
Key Management Personnel Compensation (continued)
(d)
Equity instrument disclosures relating to key management personnel (continued)
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
-
-
(e)
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. In the previous financial year,
Catalyst Metals Limited had 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
16.
Related Party Disclosures
Key Management Personnel
2010
$
6,930
3,657
-
2009
$
26,400
10,543
59,988
Red Dog Option and Joint Venture Agreement (Red Dog Agreement)
The Company has a joint venture agreement on the Minnie Creek project with Red Dog
Prospecting Pty Ltd, a company in which a former director, Mark Thompson has a financial
interest, The Company is manager of the joint venture and whilst it is solely funding exploration
costs up to completion of a feasibility study, it has conduct of the joint venture operations as it
sees fit.
Mr Thompson’s directors’ fees of $7,500 were paid to Red Dog Prospecting Pty Ltd, a company
in which Mr Thompson has a relevant interest. In 2009, Mr Thompson’s directors’ fees of $30,000
were paid to Lateral Minerals Pty Ltd, a company in which Mr Thompson has a relevant interest
and $54,535 was paid to Red Dog Prospecting Pty Ltd for the provision of mineral exploration
services.
Mr Dixon’s directors’ fees of $7,500 (2009: $30,000) were paid to Warrior Strategic Pty Ltd, a
company in which Mr Dixon has a relevant interest.
Mr McMahon’s directors’ fees of $9,417 (2009: $37,500) were paid to Kingsreef Pty Ltd, a
company in which Mr McMahon has a relevant interest.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
33
CATALYST METALS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2010
16.
Related Party Disclosures (continued)
Mr Scrimgeour’s directors’ fees of $16,350 (2009: Nil) were paid to Culloden Capital Pte Ltd, a
company in which Mr Scrimgeour has a relevant interest. $2,725 of Mr Scrimgeour’s directors’
fee was accrued at year end.
17.
Equity-based payments
The Company has adopted 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.
No options were granted during the year.
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 2010
other than:
(a) Tenement commitments
No later than 1 year
Later than 1 year but not later than 5 years
2010
$
2009
$
17,500
15,750
-
-
17,500
15,750
2010
$
2009
$
216,200
295,000
-
-
216,200
295,000
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
34
CATALYST METALS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2010
20. Financial Instruments
Notes
Floating
Interest
Rate
$
1 year or
less
Over 1-5
years
$
$
Non
interest
bearing
$
Total
$
2010
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
8
11
4.15%
1,773,365
-
-
-
-
1,773,365
-
-
Net financial assets/(liabilities)
1,773,365
-
-
-
-
-
-
-
-
1,773,365
22,927
22,927
120
120
23,047
1,796,412
60,580
60,580
60,580
60,580
(37,533)
1,735,832
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 2010
35
CATALYST METALS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2010
20.
Financial Instruments (continued)
Reconciliation of net financial assets to net assets
Net Financial Assets
Property, plant & equipment
Exploration expenditure
Net Assets
2010
$
2009
$
1,735,832
1,407,310
12,585
275,277
8,516
162,294
2,023,694
1,578,120
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.
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 2010, 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 $17,734 (2009: $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 is spread amongst
approved counterparties.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
36
CATALYST METALS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2010
20.
Financial Instruments (continued)
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.
22.
Subsequent Events
On 2 July 2010 a General Meeting of shareholders approved the following resolutions:
• Ratified the placement made in December 2009 of 3 million ordinary shares at 10 cents each;
• Authorised the issue of options under the Catalyst Metals Ltd Employee Share Option Plan; and
• Approved the issue of 1,500,000 unlisted options to consultants of the Company.
On 12 July 2010, 500,000 unlisted options were issued under the Employee Share Option Plan.
23.
Contingent Liabilities and Contingent Assets
The Company does not have any contingent liabilities or contingent assets at 30 June 2010.
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
37
CATALYST METALS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For The Year Ended 30 June 2010
24.
Parent Entity Disclosure
Total current assets
Total assets
Total current liabilities
Total liabilities
Equity
Contributed equity
Reserves
Accumulated losses
Total equity
Loss for the year
Total comprehensive income
2010
$
2009
$
2,071,923
1,475,633
2,084,508
1,646,443
60,580
68,323
60,580
68,323
4,025,455
82,609
(2,084,136)
3,356,710
82,609
(1,861,199)
2,023,928
1,578,120
(222,937)
(1,514,626)
(222,937)
(1,514,626)
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
38
CATALYST METALS LIMITED
DIRECTORS’ DECLARATION
The Directors of the company declare that in the opinion of the Directors:
1.
the financial statements and notes are in accordance with the Corporations Act 2001 and:
(a) comply with Accounting Standards and the Corporations Regulations 2001; and
(b) give a true and fair view of the consolidated entity’s financial position as at 30 June 2010
and of its performance for the year then ended;
2.
the financial statements and notes thereto also comply with International Financial Reporting
Standards, as disclosed in Note 1;
3.
the directors have given the declarations required by s295A of the Corporations Act 2001; and
4.
there are reasonable grounds to believe that the company will be able to pay its debts as and
when they become due and payable.
This declaration is made in accordance with a circular resolution of the Board of Directors.
Stephen Boston
Chairman
Dated at Perth this 29th day of September 2010
Catalyst Metals Limited ABN 54 118 912 495 Annual Report 2010
39
CATALYST METALS LIMITED
CORPORATE GOVERNANCE STATEMENT
A description of the Company’s main corporate governance practices is set out below. These
practices, unless otherwise stated, were in place for the entire financial year. Copies of relevant
corporate governance policies and charters are available in the corporate governance section of the
Company’s web-site at www.catalystmetals.com.au.
Good corporate governance will evolve with the changing circumstances of a company and must be
tailored to meet these circumstances. Catalyst is a junior exploration company which currently
operates with no permanent staff and no executive directors.
BOARD OF DIRECTORS
The Board is responsible for guiding and monitoring the Company on behalf of shareholders by whom
they are elected and to whom they are accountable. The Board’s primary role is to formulate the
strategic direction of the Company and to oversee the Company’s business activities and
management.
The Company has established functions reserved for the Board and those to be delegated to senior
management, as set out in the Company’s Board charter. The charter states that the Board is
responsible for:
the overall strategic direction and leadership of the Company;
•
• approving and monitoring management implementation of objectives and strategies;
• approving the annual strategic plan and monitoring the progress of both financial and non-financial
•
•
performance;
the corporate governance of the Company, and
the establishment and maintenance of a framework of internal control and appropriate ethical
standards for the management of the Company.
Due to the level and nature of the Company’s current activities, there is presently no designated
Managing Director position within the Company. A Managing Director will be appointed for the
Company when the level of activities and circumstances warrant. Upon the appointment of a
Managing Director, day to day management of the Company’s affairs and the implementation of
corporate strategies will be formally delegated by the Board to the Managing Director.
Board composition and independence
The Board charter states that the Board is to comprise an appropriate mix of both executive and non-
executive directors and where possible, the roles of Chairman and Managing Director are not be
combined.
The Company has a three member Board comprising three non-executive directors, including the
Chairman. Mr Boston and Mr Scrimgeour are not considered independent by virtue of their respective
major shareholdings in the Company. Mr Schwab is considered an independent director based on the
principles set out below.
Board members should possess complementary business disciplines and experience aligned with the
Company’s objectives, with a number of directors being independent and where appropriate, major
shareholders being represented on the Board. Under present circumstances, there is not a majority of
directors classified as being independent, according to ASX guidelines. Where any director has a
material personal interest in a matter, the director must declare his interest and is not permitted to be
present during discussions or to vote on the matter.
The current composition of the Board is considered suitable for the Company’s current size and level of
operations and includes an appropriate mix of skills, expertise and experience relevant to the
Company’s business. Details of the experience, qualifications and term of office of directors are set out
in the Directors’ Report.
42
CATALYST METALS LIMITED
CORPORATE GOVERNANCE STATEMENT
Having regard to the share ownership structure of the Company, it is considered appropriate by Board
that a major shareholder may be represented on the Board and if nominated, hold the position of
Chairman. Such appointment would not be deemed to be independent under ASX guidelines. The
Chairman is expected to bring independent thought and judgement to his role in all circumstances.
Where matters arise in which there is a perceived conflict of interest, the Chairman must declare his
interest and abstain from any consideration or voting on the relevant matter.
The Board has adopted ASX recommended principles in relation to the assessment of directors’
independence, which identifies shareholdings, executive roles and contractual relationships which may
affect independent status. Financial materiality thresholds used in the assessment of independence are
set at 10% of the annual gross expenditure of the Company and/or 25% of the annual income or
business turnover of the director.
Directors have the right, in connection with their duties and responsibilities, to seek independent
professional advice at the Company’s expense, subject to the prior written approval of the Chairman,
which shall not be unreasonably withheld.
Performance assessment
The Board has adopted a policy for an annual self assessment of its collective performance, the
performance of individual directors and of Board committees. The Chairman meets with each non-
executive director separately to discuss individual performance and the Board as a whole discusses and
analyses its performance over the previous 12 months and examines ways in which the Board can
better perform its duties. Due to changes in the composition of the Board during the year, no formal
assessment was undertaken during the year ended 30 June 2010. However, the chairman assesses the
performance of the Board and individual directors.
The performance of senior executives will be reviewed annually by the Board through a formal
performance appraisal and interview. Currently, the Board is collectively responsible for the evaluation
of any senior executives. Executive remuneration and other terms of employment will be reviewed
annually by the Board having regard to performance, relevant comparative information and where
appropriate, expert advice. The Company does not presently have any senior executive positions and
accordingly, no formal evaluation of senior executive performance was undertaken during the year.
BOARD COMMITTEES
The Board has established a separate audit committee. Matters determined by the committee are
submitted to the full Board as recommendations for Board consideration.
Membership of the audit committee comprises two non-executive directors, Mr Schwab (chairman)
and Mr Scrimgeour. A vacancy exists on the audit committee until such time as the appointment of an
additional non-executive director to the Board. Details of the qualifications of committee members and
attendance at audit committee meetings are set out in the Directors’ Report.
The audit committee operates in accordance with a written charter. The audit committee oversees
accounting and reporting practices and is also responsible for:
•
•
reviewing and approving statutory financial reports and all other financial information distributed
externally;
co-ordination and appraisal of the quality of the audits conducted by the Company’s external
auditor;
• determination of the independence and effectiveness of the external auditor;
• assessment of whether non-audit services have the potential to impair the independence of the
external auditor;
reviewing the adequacy of the reporting and accounting controls of the Company.
•
43
CATALYST METALS LIMITED
CORPORATE GOVERNANCE STATEMENT
The current size of the Board and the stage of development of the Company do not warrant the
establishment of separate remuneration or nomination committees. The directors as a whole are
responsible for the functions normally undertaken by these committees. In circumstances where the
growth or complexity of the Company changes, the establishment of separate committees will be
reconsidered.
The Board reviews all remuneration policies and practices for the Company, including overall strategies
in relation to executive remuneration policies and compensation arrangements for any executive
directors and senior management, as well as all equity based remuneration plans. The structure for the
remuneration of non-executive directors and senior executives is separate and distinct. Details of the
Company’s remuneration policies are set out in the Remuneration Report section of the Directors’
Report.
The current size of the full Board permits it to act as the nomination committee and to regularly review
membership. When a Board vacancy occurs, the Board identifies the particular skills, experience and
expertise that will best complement Board effectiveness and then undertakes a process to identify
candidates who can meet those criteria.
Board nomination procedures
The current size of the full Board permits it to act as the nomination committee and to regularly review
membership. When a Board vacancy occurs, the Board identifies the particular skills, experience and
expertise that will best complement Board effectiveness and then undertakes a process to identify
candidates who can meet those criteria.
EXTERNAL AUDITORS
The performance of the external auditors is reviewed annually. RSM Bird Cameron was appointed as
external auditors in May 2006. The current audit engagement partner has conducted the audit since
December 2006 with rotation due no later than five years from that date.
The external auditors provide an annual declaration of their independence to the Board. The auditors
are requested to attend annual general meetings and be available to answer shareholder questions
about the conduct of the audit and the preparation and content of the audit report.
Corporate reporting
The chief executive officer (or equivalent) and chief financial officer provide a declaration to the Board
that the Company’s external financial reports present a true and fair view of the Company’s financial
condition and operational results and that the declaration in relation to the integrity of the Company’s
external financial reports is founded on sound risk management and internal control systems and that
those systems are operating effectively in relation to financial reporting risks.
RISK MANAGEMENT
The Board is responsible for the oversight of the Company’s risk management and control framework.
Responsibility for control and risk management will be delegated in the future to the appropriate level of
management within the Company with the Managing Director (or equivalent) having ultimate
responsibility to the Board for the risk management and control framework.
The Company’s risk management systems are evolving and it is recognised that the extent of the
systems will develop with the growth in the Company’s activities. Internal controls are designed to
manage 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.
As the Board currently has responsibility for the monitoring of risk management it has not required a
formal report regarding the material risks and whether those risks are managed effectively.
44
CATALYST METALS LIMITED
CORPORATE GOVERNANCE STATEMENT
CODE OF CONDUCT
A formal code of conduct has been established and applies to all directors and employees, to guide
compliance with the legitimate interests of all stakeholders. The code aims to encourage the
appropriate standards of conduct and behaviour of the directors, employees and contractors of the
Company. All personnel are expected to act with integrity and objectivity, striving at all times to
enhance the reputation and performance of the Company.
The Company’s share trading policy prohibits the purchase or disposal of securities by directors, senior
executives and other designated persons in the period of one week prior to the release of quarterly
reports and the Company’s annual and half-year financial results. Any proposed transactions to be
undertaken must be notified to the Chairman in advance. Directors are also required to immediately
advise the Company of any transactions conducted by them in the securities of the Company.
Where the Company grants securities under an equity based remuneration scheme, participants will be
prohibited from entering into arrangements for the hedging, or otherwise limiting their exposure to risk in
relation to unvested shares, options or rights issued or acquired under the scheme.
CONTINUOUS DISCLOSURE AND SHAREHOLDER COMMUNICATIONS
The Company has a formal written policy for the continuous disclosure of any price sensitive information
concerning the Company. The Board has also adopted a formal written policy covering arrangements
to promote communications with shareholders and to encourage effective participation at general
meetings.
The Chairman and Company Secretary have been nominated as the Company’s primary disclosure
officers. All information released to the ASX is posted on the Company’s web-site immediately after it is
disclosed to the ASX. When analysts are briefed on aspects on the Company’s operations, the material
used in the presentation is released to the ASX and posted on the Company’s web-site.
All shareholders are entitled to receive a copy of the Company’s annual report. In addition, the
Company makes all market announcements, media briefings, details of shareholders’ meetings, press
releases and financial reports available on the Company’s web-site.
45
CATALYST METALS LIMITED
ADDITIONAL INFORMATION
The following information was reflected in the records of the Company as at 29 September 2010.
Distribution of share and option holders
1
1,001
5,001
10,001
- 1,000
- 5,000
- 10,000
- 100,000
100,001 and over
Including holdings of less than a marketable parcel
Number of holders
Fully paid
shares
Unlisted
options
23
45
62
156
45
331
49
-
-
-
-
3
3
Substantial shareholders
The following shareholders have lodged a notice of substantial shareholding in the Company.
Shareholder
Trapine Pty Ltd
Robin Scrimgeour
Twenty largest holders of fully paid shares
Shareholder
Trapine Pty Ltd
Robin Scrimgeour
Chepalix Pty Ltd
Gavin Caudle
Toby Mountjoy
Kenneth Raymond Teagle
1.
2.
3.
4.
5.
6.
7. Mining Tenement Management Pty Ltd
Lateral Minerals Pty Ltd
8.
Howard Dawson
9.
10.
Kingsreef Pty Ltd
11. Drill Investments Pty Ltd
12.
13.
14.
15. Vestcourt Pty Ltd
16.
Jonenderbee Investments Pty Ltd
Bruce Myles
17.
18. Allen Lafferty
19. Winthrop Cafe Pty Ltd
20. Mark James Thompson
Jodie Nicole Marwick
Richard Hanbury and Cheryl Hanbury
Silverpeak Nominees Pty Ltd
Number of shares
%
3,819,628
1,870,561
12.49
6.12
Shares
3,819,628
1,870,561
1,500,000
1,500,000
1,437,512
1,175,000
1,100,000
1,000,020
960,012
900,000
700,000
635,016
600,000
500,000
500,000
350,000
343,387
337,815
272,000
265,250
19,766,201
%
12.49
6.12
4.90
4.90
4.70
3.84
3.60
3.27
3.14
2.94
2.29
2.08
1.96
1.63
1.63
1.14
1.13
1.10
0.89
0.87
64.62
46
CATALYST METALS LIMITED
ADDITIONAL INFORMATION
Classes of shares and voting rights
At meetings of members or classes of members, each member entitled to vote may vote in person or by
proxy or attorney. On a show of hands every holder of ordinary shares present at a meeting in person or
by proxy is entitled to one vote, and on a poll, every person present in person or by proxy has one vote for
each ordinary share held.
Unquoted securities
The following classes of unquoted securities are on issue:
Security
on issue Name of holder
Number
%
Number Holders of greater than 20% of each class of
security
Options over fully paid shares exercisable:
- at 20 cents each on or before 30.06.14
1,000,000 John Arbuckle
Frank Campagna
- at 30 cents each on or before 30.06.15
1,000,000 John Arbuckle
Frank Campagna
375,000
375,000
375,000
375,000
37.5
37.5
37.5
37.5
Tenement directory
Project
Tenement number
Beneficial interest
Western Australia
Eudamullah
Michelles Well
Bluebush Well
Wanna
Victoria
Everton
E09/1174
E09/1291
E09/1303
E09/1776 (application)
EL4866
90%
90%
90%
90%
100%
Competent persons statement
The information in this report that relates to exploration results is based on and accurately reflects,
information compiled by Mr Dean de Largie B.Sc. Geol, who is a Fellow of the Australian Institute of
Geoscientists. Mr de Largie is a geological consultant to the Company and has sufficient experience
which is relevant to the style of mineralisation and type of deposit under consideration and to the
activity to which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of
the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the
JORC Code). Mr de Largie consents to the inclusion in the report of the matters based on his
information in the form and context in which it appears.
47