ABN 49 119 057 457
for the Year Ended
30 June 2020
Annual Report for Year Ending 30 June 2020
Table of Contents
Highlights for the Year to 30 June 2020
Corporate Directory
Review of Operations
Directors’ Report
Auditor’s Independence Declaration
Consolidated Statement of Profit or Loss and Other Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Notes to the Financial Statements
Directors’ Declaration
Independent Auditor’s Report
Additional Information for Listed Public Companies
Tenement Schedule
3
4
5
9
14
15
16
17
18
19
34
35
38
39
ASX Code: CNJ
Page 2 of 39
Annual Report for Year Ending 30 June 2020
HIGHLIGHTS FOR THE YEAR TO 30 JUNE 2020
Mt Thirsty now assumes the mantle of Australia’s most advanced genuine cobalt project
with a completed Pre-Feasibility Study (PFS)
Hydrometallurgical process is at atmospheric pressure and 70-90ºC utilising sulphur
dioxide (SO2) as the main reagent
Maiden JORC 2012 Probable Ore Reserve of 18.8 Mdt at 0.13% cobalt and 0.54% nickel
estimated for the project
Positive economics returned over a 12 year mine life with a pre-tax NPV of A$44.4M
(A$25.7M post-tax)
Capital Expenditure of A$371M including 10% indirects, 9% growth allowance, 4%
owner’s costs, and 10% contingency
All in Sustaining Costs of US$35,400/t contained cobalt
The direct project expenditure for the MTJV now reverts to a minimum while the
partnering strategy for the project is pursued as planned
Figure 1: Mt Thirsty Project Location
ASX Code: CNJ
Page 3 of 39
Annual Report for Year Ending 30 June 2020
CORPORATE DIRECTORY
DIRECTORS:
Gregory H Solomon LLB (Non-Executive Chairman)
Douglas H Solomon BJuris LLB (Hons) (Non-Executive)
Guy T Le Page B.A., B.Sc. (Hons).,M.B.A., F.FIN., MAusIMM (Non-Executive)
James B Richardson Dip, Fin Plan (Non-Executive)
COMPANY SECRETARY:
Aaron P Gates B.Com CA AGIA
REGISTERED OFFICE:
Level 15,
197 St Georges Terrace
Perth, Western Australia 6000
Tel +61 8 9282 5889
Email: mailroom@conico.com.au
Website: www.conico.com.au
SOLICITORS:
Solomon Brothers
Level 15,
197 St Georges Terrace
Perth, Western Australia 6000
AUDITORS:
Nexia Perth Audit Services Pty Ltd
Chartered Accountants
Level 3
88 William Street
Perth, Western Australia 6000
SHARE REGISTRY:
Advanced Share Registry Services
110 Stirling Highway
Nedlands, Western Australia 6009
STOCK EXCHANGE LISTING:
ASX Code: CNJ (ordinary shares)
CNJO (listed options)
Quotation has been granted for all the ordinary shares of the company on all Member Exchanges of the Australian
Securities Exchange Limited.
ASX Code: CNJ
Page 4 of 39
Annual Report for Year Ending 30 June 2020
REVIEW OF OPERATIONS
Mt Thirsty Project Summary
The Mt Thirsty Cobalt Project is located 16km north-northwest of Norseman, Western Australia (Figure 1).
The Project contains the Mt Thirsty Cobalt-Nickel (Co-Ni) Oxide Deposit that has the potential to emerge as a significant
cobalt producer. In addition to the Co-Ni Oxide Deposit, the Project also hosts nickel sulphide (Ni-S) mineralisation.
The Project is close to all necessary infrastructure (rail, road, power, water, and sea port) and, being in a mining
orientated state, has the potential to attract a variety of interested parties including end users of cobalt. Mt Thirsty has the
potential to become a major supplier to the burgeoning battery supply chain.
The great advantage of Mt Thirsty compared to other potential cobalt operations is the nature of the resource, being a flat
lying, continuous and thick deposit starting from near surface to around 70 metres below surface. Due to intense
oxidation, the deposit is very soft, fine grained and low in silica.
The Mt Thirsty Project is highly leveraged to cobalt prices with approximately 70% of potential revenue being from cobalt;
far higher than other nickel laterite projects.
The Mount Thirsty Joint Venture (MTJV) has recently completed a Pre-Feasibility Study (PFS) on the project utilising
industry leading consultants led by Amec Foster Wheeler Australia Pty Ltd, trading as Wood.
Figure 1: Mt Thirsty Project Location
Activities
The Pre-Feasibility Study (PFS) for the project was completed and announced to the ASX on 20 February 2020.
The PFS is based on the 26.9 Mdt @ 0.117% cobalt and 0.52% nickel Indicated and Inferred Mineral Resource (Table 1)
and allowed a Maiden Probable Ore Reserve of 18.8 Mdt @ 0.126% cobalt and 0.54% nickel to be estimated (Table 2).
Table 1: 2019 Mineral Resource estimates (all grades reported on a dry basis).
Mineral Resource
Mt Thirsty Main Indicated
Mt Thirsty Main Inferred
Mt Thirsty Main
Sub Total
Mt Thirsty North Inferred
Total
Cut-off
(Co%)
0.06
0.06
Wet
Tonnes
(Mt)
31.2
3.5
0.06
34.7
0.06
0.06
2.0
36.7
Moisture
(% wet t)
27%
27%
27%
27%
27%
Dry
Tonnes
(Mt)
22.8
Co
(%)
Ni
(%)
Mn
(%)
Fe
(%)
0.121
0.53
0.79
21.3
2.5
0.103
0.45
0.66
19.1
25.4
0.119
0.52
0.77
21.1
1.5
0.092
0.55
0.48
19.4
26.9
0.117
0.52
0.76
20.9
ASX Code: CNJ
Page 5 of 39
Annual Report for Year Ending 30 June 2020
Mineral
Resource
Cut-off
(Co%)
Mt Thirsty
Probable
Approx.
0.07% Co
(Variable)
Table 2: Mt Thirsty Ore Reserve estimate.
Wet
Tonnes
(Mwt)
Moisture (%
wet t)
Dry
Tonnes
(Mdt)
Co
(%)
Ni
(%)
Mn
(%)
Fe (%)
25.9
27%
18.8
0.126
0.54
0.80
21.6
Refer to ASX Announcements of 9/9/2019 for full details of the Mineral Resource and 20/2/2020 for full details of the Ore
Reserve.
The PFS has assumed a water supply of 1.8 GLpa of hyper saline (4 times seawater) from the paleochannel aquifers for
process water supplemented by 0.2 GLpa of saline water (1 times seawater) to be treated by reverse osmosis for the
potable and demineralised water requirements for the Project. A $170,000 investigative drilling program has been
prepared with program of work approvals in place. This will form a key part of future studies on the Project.
Metallurgical testwork on the project included beneficiation studies (the base case selected whole ore leaching in
preference to beneficiation), 71 leaching tests (including 7 at the bulk 20 dry kg scale), and testwork to demonstrate each
of the proposed process engineering steps. The testwork was based on representative sample composites from 2016
Reverse Circulation and 2018 Air Core drilling campaigns.
Mining will be by conventional open pit methods using 200t hydraulic excavators and 150t off-road trucks. Most of the ore
will be free dig with an allowance for drill and blast in the laterite cap rock. 14 pit stages based on whittle optimisations
have been scheduled over a 12 year mine life. 18.8 Mdt of Ore Reserves plus an additional 1.0 Mdt of Inferred Mineral
Resources at Mt Thirsty and 0.8Mdt of Inferred Mineral Resources have been scheduled at a 1.8Mdtpa Ore feed rate
and a 2.4:1 waste:ore strip ratio.
The ore feed will pass through a static grizzly into a mineral sizer, prior to wet scrubbing in an open circuit SAG mill and
then closed circuit grinding in a ball mill to meet a -53um leach feed specification. The ball mill cyclone overflow is
thickened to 40% solids (in hypersaline process water) and leached at 70-90ºC at atmospheric pressure using SO2 and
air. Sulphur will be imported and burnt in air to make sulphur dioxide that will be diluted with compressed air and sparged
into the leach tanks at varying concentrations. The leached slurry will be primary neutralised with limestone and treated
by counter current decantation before secondary neutralisation using limestone. The cobalt and nickel in the neutralised
solution is recovered by mixed sulphide precipitation using NaHS and NaOH prior to filtering and product bagging.
Manganese precipitation using sulphur dioxide and tailings neutralisation with limestone and lime complete the process
(Figures 2 and 3).
Figure 2: Schematic Process Flowsheet for Mt Thirsty.
ASX Code: CNJ
Page 6 of 39
Annual Report for Year Ending 30 June 2020
Figure 3: 3D isometric of the Mt Thirsty processing plant showing generalised process flow (numbered labels).
Tailings will be stored on site in a dedicated single cell tailings dam constructed using the downstream stacking method
from mine waste and engineered rock fill in accordance with stringent regulatory guidelines and approvals.
The Project is fortunate to be located only 16km north-west of Norseman and only 4km from the Coolgardie-Esperance
Highway (part of the Trans-Australia Highway 1) (Figure 1). This infrastructure corridor includes road, rail, gas, water,
fibre optic infrastructure, some of which will be useful to the Project. Power and steam will be generated on site.
A workforce of up to 300 both during construction and operations will be accommodated in existing and proposed camps
in the nearby towns of Norseman and Kambalda with a combination of residential, fly-in fly-out and drive-in-drive-out
workers.
A reconnaissance flora and fauna survey was conducted by Spectrum Ecology at Mt Thirsty in spring 2018. The survey
did not identify any rare plants or animals. Plants listed as priority flora were however identified and Mallee Fowl are
known in the area. As such, a targeted flora and Mallee Fowl search was conducted over the tenements in spring 2019.
No evidence of Mallee Fowl were found. Seven priority flora species were recorded. Approvals under the Environmental
Protection Act 1986, Environmental Protection Act 1986, and Mining Act 1978 should be able to be completed within 6
months.
The capital cost estimate for the project is A$370.7M +/- 25% including 10% contingency on direct and indirect costs, 9%
growth allowance and 4% owner’s costs.
The operating cost estimate is $65.32 per dry tonne at the process design criteria grades, but will vary over the life of
mine with reagent consumption tied to feed grades. The all in Sustaining Cost is US$35,400 per tonne of contained
cobalt metal after adjusting for Nickel credits and payability discounts.
The financial analysis returned the following results:
•
•
•
•
•
Life of Mine Revenue after Royalties $1,848M (71% from Cobalt and 29% from Nickel)
Life of Mine Operating Costs $1,233M
Life of Mine Cumulative Net Cash Flow $213M
Pre Tax NPV $44.4M
Post Tax NPV $25.7M
Land Access
All biological surveys sufficient to support approvals for the project are complete.
Granted tenure, land access agreements and program of works approvals are now in place for water search drilling for
the project. This activity has however been rescheduled as a post-PFS activity.
Tenement applications for mining, roads and infrastructure are also moving through the process towards grant.
Next Steps
Native Title negotiations are continuing with the Ngadju Traditional Owners and no impediments to an agreement are
anticipated.
ASX Code: CNJ
Page 7 of 39
Annual Report for Year Ending 30 June 2020
The Mt Thirsty Joint Venture (MTJV) has identified the highest value development path to be a farm-in from a large
global firm, eager to secure a guaranteed sustainable source of cobalt. The MTJV is now re-engaging with several major
Australian and international mining, trading and refining firms who have all identified a high quality PFS as their minimum
investment criteria.
The direct Project expenditure for the MTJV now reverts to a minimum while the partnering strategy is pursued as
planned.
OTHER OPPORTUNITIES
Conico is actively seeking other opportunities to diversify its focus and is currently evaluating a project for potential
acquisition.
Disclaimer
The interpretations and conclusions reached in this report are based on current geological theory and the best evidence available to the
authors at the time of writing. It is the nature of all scientific conclusions that they are founded on an assessment of probabilities and,
however high these probabilities might be, they make no claim for complete certainty. Any economic decisions that might be taken
based on interpretations or conclusions contained in this report will therefore carry an element of risk.
This report contains forward-looking statements that involve a number of risks and uncertainties. These forward-looking statements are
expressed in good faith and believed to have a reasonable basis. These statements reflect current expectations, intentions or strategies
regarding the future and assumptions based on currently available information. Should one or more of the risks or uncertainties
materialise, or should underlying assumptions prove incorrect, actual results may vary from the expectations, intentions and strategies
described in this report. No obligation is assumed to update forward-looking statements if these beliefs, opinions and estimates should
change or to reflect other future developments.
Competent Persons Statements
The information in this report that relates to Exploration Results for the Mt Thirsty project is based on and fairly represents information
compiled by Michael J Glasson, a Competent Person who is a member of the Australian Institute of Geoscientists. Mr Glasson is an
employee of Tasman Resources Ltd and in this capacity acts as part time consultant to Conico Ltd and the MTJV. Mr Glasson holds
shares in Conico Ltd.
The information in this report which relates to Mineral Resources for the Mt Thirsty Cobalt-Nickel Project is based on information
provided to and compiled by Mr David Reid, a Competent Person who is a full-time employee of Golder Associates Pty Ltd, and a
Member of the Australasian Institute of Mining and Metallurgy. Mr Reid consents to the inclusion in the report of the matters based on
his information in the form and context in which it appears.
The information in this report which relates to the Metallurgy for the Mt Thirsty Cobalt-Nickel Project is based on and fairly represents
information compiled by Mr David Nofal who is a Fellow of the Australian Institute of Mining and Metallurgy and a full-time employee of
AMEC Foster Wheeler (trading as Wood). Mr Nofal consents to the inclusion in the report of the matters based on his information in the
form and context in which it appears.
The information in this report which relates to Mining and Ore Reserves for the Mt Thirsty Cobalt-Nickel Project is based on information
provided to and compiled by Mr Frank Blanchfield, a Competent Person who is a full-time employee of Snowden Mining Industry
Consultants Pty Ltd, and a Fellow of the Australasian Institute of Mining and Metallurgy. Mr Blanchfield consents to the inclusion in the
report of the matters based on his information in the form and context in which it appears.
Messer’s Glasson, Reid, Nofal and Blanchfield have sufficient relevant experience to the style of mineralisation and type of deposits
under consideration and to the activity for which they are undertaking to qualify as Competent Persons as defined in the JORC Code
(2012 Edition).
Previously announced information is cross referenced to the original announcements. In these cases, the company is not aware of any
new information or data that materially affects the information presented and that the material assumptions and technical parameters
underpinning the estimates continue to apply and have not materially changed. The company confirms that the form and context in
which the Competent Persons’ findings are presented have not been materially modified from the original market announcements.
ASX Code: CNJ
Page 8 of 39
Annual Report for Year Ending 30 June 2020
DIRECTORS’ REPORT
The directors present their report together with the consolidated financial statements of the Group comprising Conico Ltd
(the Company) and its controlled entity and the Group’s interest in a joint venture for the year ended 30 June 2020.
Directors
The names of directors in office at any time during or since the end of the year are:
Gregory H Solomon
Douglas H Solomon
Guy T Le Page
James B Richardson
Directors have been in office since the start of the financial year to the date of this report unless otherwise stated.
Company Secretary
The following person held the position of Company Secretary at the end of the financial year and at the date of this
report:
Mr Aaron P Gates has worked for Conico Ltd for the past 12 years. He is a Chartered Accountant and Chartered
Secretary, has completed a Bachelor of Commerce (Curtin University) with majors in accounting and business law and
completed a Diploma of Corporate Governance. Prior to joining Conico he worked in public practice in audit and
corporate finance roles.
Principal Activities
The principal activity of the Group for year ended 30 June 2020 was mineral exploration for cobalt and nickel.
There were no significant changes in the nature of the activities of the Group during the year.
Operating Results
The loss of the Group after providing for income tax amounted to $349,970 (2019: $468,501). Cash outflow from
operating activities was $188,576 (2019: $475,130).
Dividends Paid or Recommended
No dividends were paid or declared for payment during the year.
Review of Mineral Exploration Operations
A review of the operations of the Group for the year ended 30 June 2020 is set out on Page 5.
Financial position
The net assets of the Group have decreased by $41,405 from 30 June 2019, to $15,227,361 in 2020. This decrease is
largely due to the loss during the year.
Significant Changes in State of Affairs
In the opinion of the directors, other than disclosed elsewhere in this report, there were no significant changes in the
state of affairs of the Group that occurred during the year.
After Balance Date Events
The impact of the Coronavirus (COVID-19) pandemic is ongoing and whilst it has had no financial impact for the Group
up to 30 June 2020, it is not practicable to estimate the potential impact, positive or negative, after the reporting date.
The situation is rapidly developing and is dependent on measures imposed by the Australian Government and other
countries, such as maintaining social distancing requirements, quarantine, travel restrictions and any economic stimulus
that may be provided.
On 29 July 2020 the Company executed a Binding Term Sheet, subject to shareholder approval, to acquire Longland
Resources Ltd (“Longland”) in consideration of 120,000,000 Conico Ltd shares. Longland has a 100% interest in the
Ryberg Project and the Mestervig Project in Greenland.
No other matters or circumstances have arisen since the end of the financial year which significantly affected or may
significantly affect the operations of the Group, the results of those operations, or the state of affairs of the Group in
future financial years.
Future Developments, Prospects and Business Strategies
The Group proposes to continue with its exploration and evaluation program as detailed in the Review of Operations.
Environmental Issues
The Group is the subject of environmental regulation with respect to mining exploration and will comply fully with all
requirements with respect to rehabilitation of exploration sites.
ASX Code: CNJ
Page 9 of 39
Annual Report for Year Ending 30 June 2020
Information on Directors
Gregory H Solomon
Non-Executive Chairman
Qualifications
Experience
Interest in Shares and Options
LLB
Appointed chairman March 2006. Board member since March 2006. A
solicitor with more than 30 years of Australian and international experience in
a wide range of areas including mining law, commercial negotiation (including
numerous mining and exploration joint ventures) and corporate law. He is a
partner in the Western Australian legal firm, Solomon Brothers and has
previously held directorships of various public companies since 1984
including two mining/exploration companies.
27,193,654 Ordinary Shares
2,000,000 Unlisted Options
4,088,185 CNJO Options
Directorships held in other listed
entities
Eden Innovations Ltd
Tasman Resources Ltd
Douglas H Solomon
Qualifications
Experience
Interest in Shares and Options
Non-Executive
BJuris LLB (Hons)
Board member since 30 March 2006. A Barrister and Solicitor with more than
20 years’ experience in the areas of mining, corporate, commercial and
property law. He is a partner in the legal firm, Solomon Brothers.
25,200,860 Ordinary Shares
2,000,000 Unlisted Options
3,688,985 CNJO Options
Directorships held in other listed
entities
Eden Innovations Ltd
Tasman Resources Ltd
Guy T Le Page
Qualifications
Experience
Non-Executive
B.A., B.Sc. (Hons).,M.B.A., F.FIN., MAusIMM
Board member since 30 March 2006. Currently a corporate adviser
specialising in resources. He is actively involved in a range of corporate
initiatives from mergers and acquisitions, initial public offerings to valuations,
consulting and corporate advisory roles. He previously spent 10 years as an
exploration and mining geologist in Australia, Canada and the United States.
His experience spans gold and base metal exploration and mining geology
and he has acted as a consultant to private and public companies.
Interest in Shares and Options
17,185,859 Ordinary Shares
2,000,000 Unlisted Options
1,333,357 CNJO Options
Directorships held in other listed
entities
Mt Ridley Mines Ltd
Tasman Resources Ltd
James B Richardson
Qualifications
Experience
Non-Executive
Dip, Fin Plan
Board member since 11 November 2008. Currently a corporate advisor where
he has been actively involved in a range of corporate activities, including the
development, documentation, negotiation and marketing of a number of
successful financial instruments for various companies encompassing various
sectors of the investment market. He has also been employed as a specialist
business development executive in some of the more successful national
financial services organisations. Additionally, he has extensive experience in
evaluating investment opportunities, structuring projects and negotiating
financial transactions to meet the expectations of the investment market.
Interest in Shares and Options
29,377,083 Ordinary Shares
2,000,000 Unlisted Options
877,083 CNJO Options
Directorships held in other listed
entities
None
ASX Code: CNJ
Page 10 of 39
Annual Report for Year Ending 30 June 2020
Remuneration Report (Audited)
This report details the nature and amount of remuneration for each director of Conico Ltd, and for the executives
receiving the highest remuneration.
Remuneration Policy
The remuneration policy of Conico Ltd has been designed to align director and executive objectives with shareholder and
business objectives by providing a fixed remuneration component and offering specific long-term incentives based on
key performance areas affecting the company’s financial results. The board believes the remuneration policy to be
appropriate and effective in its ability to attract and retain the best executives and directors to run and manage the
company, as well as create goal congruence between directors, executives and shareholders.
The board’s policy for determining the nature and amount of remuneration for board members and senior executives of
the company is as follows:
All executives receive a base salary (which is based on factors such as length of service and experience),
superannuation, fringe benefits and options. Executives are also entitled to participate in the employee share and option
arrangements. All directors and executives receive a superannuation, which is currently 9.5%, and do not receive any
other retirement benefits.
All remuneration paid to directors and executives is valued at the cost to the company and expensed. Options are valued
using the Black-Scholes methodology or an appropriate market based pricing valuation methodology. The board policy is
to remunerate non-executive directors at market rates for time, commitment and responsibilities. The Group does not
have a policy on directors hedging their shares.
The maximum aggregate amount of fees that can be paid to non-executive directors is subject to approval by
shareholders at the Annual General Meeting. Fees for non-executive directors are not linked to the performance of the
company. However, to align directors’ interests with shareholder interests, the directors are encouraged to hold shares in
the company and are able to participate in the employee option plan.
Details of Remuneration for Year Ended 30 June 2020
The remuneration for each director and each of the executive officers of the Group during the year was as follows:
Key Management Personnel Remuneration –
Key Management
Person
Short-term Benefits
Post-
employment
benefits
Other
long-term
benefits
Termination
Benefits
Share-based
payments
Total
Salary
and Fees
Cash
Non-
profit
share
cash
benefit
Super-
annuation
Other
Other
Equity Options
$
$
$
$
$
$
$
$
$
2020
Gregory H Solomon
60,000
Douglas H Solomon
36,000
Guy T Le Page
36,000
James B Richardson
36,000
Aaron P Gates
(i)
168,000
2019
Gregory H Solomon
60,000
Douglas H Solomon
36,000
Guy T Le Page
36,000
James B Richardson
36,000
Aaron P Gates
(i)
168,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
5,700
3,420
3,420
3,420
-
15,960
5,700
3,420
3,420
3,420
-
15,960
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
65,700
39,420
39,420
39,420
-
- 183,960
-
-
-
-
-
65,700
39,420
39,420
39,420
-
- 183,960
(i) - This management personnel is remunerated by Princebrook Pty Ltd (a company in which Mr Gregory Solomon and
Mr Douglas Solomon have an interest) under the Management Services agreement with the Company. During the year
the Company paid $135,000 (2019: $144,000) to Princebrook Pty Ltd for management services.
ASX Code: CNJ
Page 11 of 39
Annual Report for Year Ending 30 June 2020
Options issued as part of remuneration for the year ended 30 June 2020
No options were issued to directors and employees as part of their remuneration during the year and no shares were
issued upon the exercise of options granted as remuneration.
Number of Options Held by Key Management Personnel
Balance
1.7.2019
Granted as
Compen-
sation
Options
Exer-
cised
Net
Change
Other*
Balance
30.6.2020
Total
Vested
30.6.2020
Total Exer-
cisable
30.6.2020
Total
Unexer-
cisable
30.6.2020
Gregory H Solomon
4,888,185
Douglas H Solomon
4,688,985
Guy T Le Page
3,333,357
James B Richardson 2,877,083
Aaron P Gates
2,000,000
Total
17,787,610
-
-
-
-
-
-
-
-
-
-
-
-
1,200,000
6,088,185 6,088,185 6,088,185
1,000,000
5,688,985 5,688,985 5,688,985
-
-
-
3,333,357 3,333,357 3,333,357
2,877,083 2,877,083 2,877,083
2,000,000 2,000,000 2,000,000
2,200,000 19,987,610 19,987,610 19,987,610
-
-
-
-
-
-
*Net Change Other refers to options that have been purchased, sold, lapsed or issued during the year.
Number of Shares Held by Key Management Personnel
Gregory H Solomon
Douglas H Solomon
Guy T Le Page
James B Richardson
Aaron P Gates
Total
Balance
30.6.2019
Received as
Compen-
sation
Options
Exercised
Net Change
Other*
Balance
30.6.2020
25,993,654
24,200,860
17,185,859
29,377,083
-
96,757,456
-
-
-
-
-
-
-
-
-
-
-
-
1,200,000
27,193,654
1,000,000
25,200,860
-
-
-
17,185,859
29,377,083
-
2,200,000
98,957,456
*Net Change Other refers to shares purchased, sold or other movements.
Directors Meetings
During the financial year, three meetings of directors were held. Attendances by each director were as follows:
Directors’ Meetings
Number eligible
to attend
Number
attended
Gregory H Solomon
Douglas H Solomon
Guy T Le Page
James B Richardson
3
3
3
3
Indemnifying Officers or Auditor
3
3
3
3
The company has arranged for an insurance policy to insure the directors against liabilities for costs and expenses
incurred by them in defending any legal proceedings arising out of their conduct while acting in the capacity of director of
the company, other than conduct involving a wilful breach of duty in relation to the company. The total premium payable
is approximately $25,735.
Proceedings on Behalf of Group
No person has applied for leave of Court to bring proceedings on behalf of the Group or intervene in any proceedings to
which the Group is a party for the purpose of taking responsibility on behalf of the Group for all or any part of those
proceedings. The Group was not a party to any such proceedings during the year.
ASX Code: CNJ
Page 12 of 39
Annual Report for Year Ending 30 June 2020
Options
At the date of this report, the unissued ordinary shares of Conico Ltd under option are as follows:
Grant Date
Date of Expiry
Exercise Price
Number under Option
29 August 2017
28 August 2020
27 November 2017
20 November 2020
Various
30 June 2021
$0.0625
$0.0488
$0.048
6,000,000
8,000,000
28,264,866
42,264,866
During the year ended 30 June 2020, no ordinary shares of Conico Ltd were issued on the exercise of options granted
under the Conico Ltd Employee Share Option Plan. No shares have been issued since in terms of the plan.
No person entitled to exercise the options had or has any right by virtue of the option to participate in any share issue of
any other body corporate.
Non-audit Services
The board of directors is satisfied that the provision of non-audit services during the year is compatible with the general
standard of independence for auditors imposed by the Corporations Act 2001. The directors are satisfied that the
services disclosed below did not compromise the external auditor’s independence for the following reasons:
all non-audit services are reviewed and approved prior to commencement to ensure they do not adversely affect
the integrity and objectivity of the auditor; and
the nature of the services provided does 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.
No fees for non-audit services were paid/payable to the external auditors during the year ended 30 June 2020.
Auditor’s Independence Declaration
The auditor’s independence declaration for the year ended 30 June 2020 has been received and can be found on page
14.
Signed in accordance with a resolution of the Board of Directors.
Gregory H Solomon
Chairman
Dated this 10th day of August 2020
ASX Code: CNJ
Page 13 of 39
Auditor’s independence declaration under section 307C of the Corporations
Act 2001
To the directors of Conico Ltd
I declare that, to the best of my knowledge and belief, in relation to the audit for the financial year
ended 30 June 2020 there have been:
(i) no contraventions of the auditor’s independence requirements as set out in the Corporations
Act 2001 in relation to the audit; and
(ii) no contraventions of any applicable code of professional conduct in relation to the audit.
Nexia Perth Audit Services Pty Ltd
M. Janse Van Nieuwenhuizen
Director
Perth
10 August 2020
Annual Report for Year Ending 30 June 2020
CONSOLIDATED STATEMENT OF PROFIT OR LOSS
AND OTHER COMPREHENSIVE INCOME FOR YEAR ENDED 30 JUNE 2020
Other Income
Accounting and audit
Depreciation and amortisation
Finance costs
Key management remuneration
Legal and other consultants
Management fees
Other expenses
Loss before income tax
Income tax benefit
Loss for the year
Other Comprehensive Income
Items that may be reclassified to profit or loss:
Revaluations of financial assets
Income tax relating to comprehensive income
Total other comprehensive income
Total Comprehensive Loss attributable to
members of the parent entity, net of tax
Note
2
Consolidated
2020
$
2019
$
22,963
(35,495)
(1,019)
(8,330)
22,618
(32,082)
(1,199)
-
6(d)
(183,960)
(183,960)
(44,627)
(85,241)
(135,000)
(144,000)
(69,102)
(84,676)
(454,570)
(508,540)
3
104,600
40,039
(349,970)
(468,501)
-
-
-
-
-
-
(349,970)
(468,501)
Basic/Diluted loss per share (cents per share)
5
(0.09)
(0.14)
The accompanying notes form part of these financial statements.
ASX Code: CNJ
Page 15 of 39
Annual Report for Year Ending 30 June 2020
CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2020
ASSETS
CURRENT ASSETS
Cash and cash equivalents
Trade and other receivables
TOTAL CURRENT ASSETS
NON-CURRENT ASSETS
Property, plant and equipment
Exploration and evaluation
TOTAL NON-CURRENT ASSETS
TOTAL ASSETS
CURRENT LIABILITIES
Trade and other payables
TOTAL CURRENT LIABILITIES
NON-CURRENT LIABILITIES
Interest bearing liabilities
Provisions
TOTAL NON-CURRENT LIABILITIES
TOTAL LIABILITIES
NET ASSETS
EQUITY
Issued capital
Reserves
Accumulated losses
TOTAL EQUITY
The accompanying notes form part of these financial statements.
Note
Consolidated
2020
$
2019
$
7
8
9
10
12
13
14
15
16
171,401
16,599
188,000
131,063
10,676
141,739
5,780
6,799
15,930,182
15,469,981
15,935,962
15,476,780
16,123,962
15,618,519
232,721
232,721
401,380
262,500
663,880
896,601
74,753
74,753
-
275,000
275,000
349,753
15,227,361
15,268,766
20,394,350
20,085,785
788,650
788,650
(5,955,639)
(5,605,669)
15,227,361
15,268,766
ASX Code: CNJ
Page 16 of 39
Annual Report for Year Ending 30 June 2020
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR YEAR ENDED 30 JUNE 2020
Consolidated Group
Ordinary
Share Capital
Option
Reserve
Retained
Earnings
Total
$
$
$
$
Balance at 30 June 2018
19,282,403
788,650
(5,137,168) 14,933,885
Net loss for the year
Shares issued (net of costs)
Other comprehensive income
-
803,382
-
-
-
-
(468,501)
(468,501)
-
-
803,382
-
Balance at 30 June 2019
20,085,785
788,650
(5,605,669) 15,268,766
Net loss for the year
Shares issued (net of costs)
Other comprehensive income
-
308,565
-
-
-
-
(349,970)
(349,970)
-
-
308,565
-
Balance at 30 June 2020
20,394,350
788,650
(5,955,639) 15,227,361
The accompanying notes form part of these financial statements.
ASX Code: CNJ
Page 17 of 39
Annual Report for Year Ending 30 June 2020
CONSOLIDATED STATEMENT OF CASHFLOWS FOR THE YEAR ENDED 30 JUNE 2020
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers
Payments to suppliers and employees
Interest received
R&D tax rebate
Note
Consolidated
2020
$
2019
$
24,183
22,023
(317,565)
(538,649)
206
104,600
1,457
40,039
Net cash provided by/(used in) operating activities
21
(188,576)
(475,130)
CASH FLOWS FROM INVESTING ACTIVITIES
Exploration and evaluation expenditure
Net cash provided by/(used in) investing activities
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from loans
Proceeds from share issues net of costs
Net cash provided by/(used in) financing activities
Net increase/(decrease) in cash held
Cash at beginning of financial year
Cash at end of financial year
(472,701)
(362,935)
(472,701)
(362,935)
393,050
308,565
701,615
40,338
131,063
171,401
-
803,382
803,382
(34,683)
165,746
131,063
13
15
7
The accompanying notes form part of these financial statements.
ASX Code: CNJ
Page 18 of 39
Annual Report for Year Ending 30 June 2020
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2020
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES
The financial report is a general purpose financial report that has been prepared in accordance with Australian
Accounting Standards, including Australian Accounting Interpretations, other authoritative pronouncements of the
Australian Accounting Standards Board and the Corporations Act 2001. The financial report of Conico Limited and its
controlled entity (Group) complies with all International Financial Reporting Standards (IFRS) in their entirety.
The financial report covers the consolidated group of Conico Ltd and its controlled entity as at and for the year ended
30 June 2020. Conico Ltd is a listed public company, incorporated and domiciled in Australia. The Group is a for-
profit entity and primarily is involved in mineral exploration for cobalt, nickel and manganese.
The financial report was authorised for issue on 10 August 2020 by the Board of Directors.
The following is a summary of the material accounting policies adopted by the Group in the preparation of the
financial report. The accounting policies have been consistently applied, unless otherwise stated.
Basis of Preparation
The accounting policies set out below have been consistently applied to all years presented.
Reporting Basis and Conventions
The financial report has been prepared on an accruals basis and is based on historical costs modified by the
revaluation of selected non-current assets, financial assets and financial liabilities for which the fair value basis of
accounting has been applied. These consolidated financial statements are presented in Australian dollars, which is
the Group’s functional currency.
Going Concern
These financial statements have been prepared on a going concern basis, which contemplates continuity of normal
business activities and the realisation of assets and extinguishment of liabilities in the ordinary course of business.
The Group has reported a net loss for the year of $349,970 (2019: $468,501) and a cash outflow from operating
activities of $188,576 (2019: $475,130).
Based on the Group’s cash flow forecast it is likely that the Group will need to access additional working capital in the
next 12 months to advance its exploration projects and to ensure the realisation of assets on an orderly basis and the
extinguishment of liabilities as and when they fall due.
The directors are confident that the Group will be successful in raising additional funds through the issue of new
equity or through additional loan funding should the need arise. The directors are also aware that the Group has the
option, if necessary, to defer expenditure and reduce administration costs in order to minimise its funding
requirements.
Based on these facts, the directors consider the going concern basis of preparation to be appropriate for this financial
report. Should the Company be unsuccessful in securing additional funding, there is a material uncertainty which
may cast significant doubt whether the entity will be able to continue as a going concern and therefore, whether it will
realise its assets and extinguish its liabilities in the normal course of business and at the amounts stated in the
financial report.
The financial statements do not include any adjustments relative to the recoverability and classification of recorded
asset amounts or, to the amounts and classification of liabilities that might be necessary should the entity not
continue as a going concern.
Accounting Policies
a.
Principles of Consolidation
A controlled entity is any entity Conico Ltd is exposed to, or has rights to, variable returns from its involvement
with the entity and has the ability to affect those returns through its power to direct the activities of the entity. A
list of controlled entities is contained in Note 17 to the financial statements. All controlled entities have a June
financial year-end.
All inter-company balances and transactions between entities in the consolidated group, including any
unrealised profits or losses, have been eliminated on consolidation. Accounting policies of controlled entities
have been changed where necessary to ensure consistencies with those policies applied by the parent entity.
b.
Interests in a Joint Operation
The consolidated financial statements include the assets that the Group controls and the liabilities that it incurs
in the course of pursuing the joint operation and the expenses that the Group incurs and its share of the
income that it earns from the joint operation. Details of the Group’s interests are shown at Note 11.
ASX Code: CNJ
Page 19 of 39
Annual Report for Year Ending 30 June 2020
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2020
c.
Income Tax
The charge for current income tax expense is based on the profit for the year adjusted for any non-assessable
or disallowed items. It is calculated using the tax rates that have been enacted or are substantially enacted by
the balance sheet date.
Deferred tax is calculated at the tax rates that are expected to apply to the period when the asset is realised or
liability is settled. Deferred tax is credited in the income statement except where it relates to items that may be
credited directly to equity, in which case the deferred tax is adjusted directly against equity.
Deferred tax is accounted for using the balance sheet liability method in respect of temporary differences
arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements.
No deferred income tax will be recognised from the initial recognition of an asset or liability, excluding a
business combination, where there is no effect on accounting or taxable profit or loss.
Deferred tax assets are recognised for unused tax losses, tax credits and deductible temporary differences, to
the extent that it is probable that future tax profits will be available against which they can be utilised.
The amount of benefits brought to account or which may be realised in the future is based on the assumption
that no adverse change will occur in income taxation legislation and the anticipation that the group will derive
sufficient future assessable income to enable the benefit to be realised.
The R&D tax offset is recognised upon receipt.
d.
Property, Plant and Equipment
Plant and equipment are measured on the cost basis.
The carrying amount of plant and equipment is reviewed annually by directors to ensure it is not in excess of
the recoverable amount from these assets. The recoverable amount is assessed on the basis of the expected
net cash flows that will be received from the asset’s employment and subsequent disposal. The expected net
cash flows have been discounted to their present values in determining recoverable amounts.
The depreciation rates used for each class of depreciable assets are:
Plant and equipment
15.00–50.00%
Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These gains
and losses are recognised in profit or loss.
e.
Exploration and Evaluation Expenditure
Exploration, evaluation and development expenditure incurred is accumulated in respect of each identifiable
area of interest. These costs are only carried forward where right of tenure is current and to the extent that
they are expected to be recouped through the successful development of the area or where activities in the
area have not yet reached a stage that permits reasonable assessment of the existence of economically
recoverable reserves.
Accumulated costs in relation to an abandoned area are written off in full against profit in the year in which the
decision to abandon the area is made.
A regular review is undertaken of each area of interest to determine the appropriateness of continuing to carry
forward costs in relation to that area of interest.
Costs of site restoration are provided over the life of the facility from when exploration commences and are
included in the costs of that stage. Any changes in the estimates for the costs are accounted on a prospective
basis. In determining the costs of site restoration, there is uncertainty regarding the nature and extent of the
restoration due to community expectations and future legislation.
f.
Impairment of Non-financial Assets
At each reporting date, the Group reviews the carrying values of its non-financial / 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 Statement of Profit or Loss and Other Comprehensive Income. Where
it is not possible to estimate the recoverable amount of an individual asset, the Group estimates the
recoverable amount of the cash-generating unit to which the asset belongs.
ASX Code: CNJ
Page 20 of 39
Annual Report for Year Ending 30 June 2020
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2020
g.
Cash and cash equivalents
Cash comprises current deposits with banks.
h.
Financial Instruments
Recognition
Financial instruments are initially measured at cost on trade date, which includes transaction costs, when the
related contractual rights or obligations exist. Subsequent to initial recognition these instruments are measured
as set out below.
Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not
quoted in an active market and are stated at amortised cost using the effective interest rate method.
The Group makes use of a simplified approach in accounting for trade and other receivables and records the
loss allowance as lifetime expected credit losses. These are the expected shortfalls in contractual cash flows,
considering the potential for default at any point during the life of the financial instrument. In calculating, the
entity uses its historical experience, external indicators and forward-looking information to calculate the
expected credit losses.
Borrowings
Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently
measured at amortised cost. Any difference between the proceeds (net of transaction costs) and the
redemption amount is recognised in profit or loss over the period of the borrowings using the effective interest
method. Borrowings are removed from the balance sheet when the obligation specified in the contract is
discharged, cancelled or expired.
Impairment
At each reporting date, the Group assesses at a specific asset level whether there is objective evidence that a
financial instrument has been impaired. Impairment losses are recognised in the Statement of Profit or Loss
and Other Comprehensive Income.
i.
Provisions
Provisions are recognised when the Group has a legal or constructive obligation, as a result of past events, for
which it is probable that an outflow of economic benefits will result and that outflow can be reliably measured.
j.
Revenue
Revenue is measured at the transaction price received or receivable (which excludes estimates of variable
consideration) allocated to the performance obligation satisfied and represents amounts receivable for
services provided in the normal course of business, net of discounts, VAT, GST and other sales related taxes.
As the expected period between transfer of a promised service and payment from the customer is one year or
less then no adjustment for a financing component has been made.
Revenue arising from the provision of services is recognised when and to the extent that the customer
simultaneously receives and consumes the benefits of the Group’s performance or the Group does not create
an asset with an alternative use but has an enforceable right to payment for performance completed to date.
Interest
Interest revenue is recognised as interest accrues using the effective interest method. This is a method of
calculating the amortised cost of a financial asset and allocating the interest income over the relevant period
using the effective interest rate, which is the rate that exactly discounts estimated future cash receipts through
the expected life of the financial asset to the net carrying amount of the financial asset.
Other revenue
Other revenue is recognised when it is received or when the right to receive payment is established.
k.
Comparative Figures
When required by Accounting Standards, comparative figures have been adjusted to conform to changes in
presentation for the current financial year.
ASX Code: CNJ
Page 21 of 39
Annual Report for Year Ending 30 June 2020
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2020
l.
New accounting standards and interpretations
The Group has adopted all of the new and revised Standards and Interpretations issued by the Australian
Accounting Standards Board (the AASB) that are relevant to their operations and effective for the current year.
The new and revised Standards and amendments thereof and Interpretations, included AASB 16 Leases. The
Group did not have any leases in current or prior periods hence there is no material impact on the adoption of
AASB 16 in the current or comparative periods.
m.
Segment reporting
Segment results that are reported to the Group’s board of directors (the chief operating decision maker)
include items directly attributable to a segment as well as those that can be allocated on a reasonable basis.
n.
Ordinary shares
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of ordinary shares
are recognised as a deduction from equity.
o.
New accounting standards and interpretations not yet adopted
A number of new standards and amendments to standards are effective for annual periods beginning after 1
July 2020, and have not been applied in preparing these consolidated financial statements. Management are
of the view that these standards and amendments will not have a significant impact on the financials.
p.
Share-based payments
The Group provides benefits to employees (including senior executives) of the Group in the form of share-
based payments. The cost of these share-based payments is measured by reference to the fair value of the
equity instruments at the date at which they are granted. The fair value at grant date is measured by use of
the Black-Scholes Option Pricing Model. 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, based on the entity’s estimate of shares that will eventually vest.
For cash-settled share-based payments, a liability equal to the portion of the goods or services received is
recognised at the current fair value determined at each reporting date.
q.
Earnings per share
Basic earnings per share
Basic earnings per share is calculated by dividing the net profit/loss attributable to the owners of Conico
Limited, excluding any costs of servicing equity other than ordinary shares, by the weighted average number
of ordinary shares outstanding during the financial year, adjusted for bonus elements in ordinary shares issued
during the financial year.
Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take
into account the after income tax effect of interest and other financing costs associated with dilutive potential
ordinary shares and the weighted average number of shares assumed to have been issued for no
consideration in relation to dilutive potential ordinary shares.
ASX Code: CNJ
Page 22 of 39
Annual Report for Year Ending 30 June 2020
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2020
r.
Critical accounting judgements, estimates and assumptions
Judgements made by management in the application of IFRS that have significant effects on the financial
statements and estimates with a significant risk of material adjustments in the next year are disclosed, where
applicable, in the relevant note to the financial statements. The following are the key assumptions concerning
the future, and other key sources of estimation uncertainty at the balance date, that have a significant risk of
causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year:
Coronavirus (COVID-19) pandemic
Judgement has been exercised in considering the impacts that the Coronavirus (COVID-19) pandemic has
had, or may have, on the consolidated entity based on known information. This consideration extends to the
nature of the activities and geographic regions in which the consolidated entity operates. Other than as
addressed in specific notes, there does not currently appear to be either any significant impact upon the
financial statements or any significant uncertainties with respect to events or conditions which may impact the
consolidated entity unfavourably as at the reporting date or subsequently as a result of the Coronavirus
(COVID-19) pandemic.
Impairment
The Group assesses impairment at each reporting date by evaluating conditions specific to the Group that
may lead to impairment of assets. Where an impairment trigger exists, the recoverable amount of the asset is
determined. The Company did not recognise any impairment charges on any of its tenements during the year
(2019: nil).
Exploration and evaluation costs carried forward
The future recoverability of capitalised exploration and evaluation expenditure is dependent on a number of
factors, including whether the Group decides to exploit the related lease itself or, if not, whether it successfully
recovers the related exploration and evaluation asset through sale.
Factors which could impact the future recoverability include the level of proved, probable and inferred mineral
resources, future technological changes which could impact the cost of mining, future legal changes (including
changes to environmental restoration obligations) and changes to commodity prices. To the extent that
capitalised exploration and evaluation expenditure is determined not to be recoverable in the future, this will
increase losses and reduce net assets in the period in which this determination is made. In addition,
exploration and evaluation expenditure is capitalised if activities in the area of interest have not yet reached a
stage which permits a reasonable assessment of the existence or otherwise of economically recoverable
reserves. To the extent that it is determined in the future that this capitalised expenditure should be written off,
this will increase losses and reduce net assets in the period in which this determination is made.
Share-based payments
The Company makes equity settled share-based payments to certain employees and consultants, which are
measured at fair value at the date of grant and expensed on a straight line basis over the vesting period, based
on the Company’s estimate of shares that will eventually vest. The fair values are determined using the Black-
Scholes Option Pricing Model. Vesting assumptions are reviewed during each reporting period to ensure they
reflect current expectations.
Loans to controlled entities
The directors believe that the recoupment of the inter-company receivables from Conico Ltd to Meteore Metals
Pty Ltd is dependent on the successful development and commercial exploitation or, alternatively, the sale of
the exploration assets held by the controlled entity.
ASX Code: CNJ
Page 23 of 39
Annual Report for Year Ending 30 June 2020
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2020
NOTE 2: OTHER INCOME
—
—
interest received
sale of goods / services
Total Other Income
Consolidated
2020
$
2019
$
206
22,757
22,963
1,457
21,161
11,548
NOTE 3: INCOME TAX BENEFIT
a.
The prima facie tax on loss from ordinary activities before income tax is reconciled to the income tax as follows:
Prima facie tax payable on loss from ordinary activities before income
tax at 27.5% (2019: 27.5%)
Tax effect of:
—
—
Current year temporary differences not recognised
Current year tax losses not recognised
Income tax (expense) / benefit
b.
Components of deferred tax
Unrecognised deferred tax asset – losses
Unrecognised deferred tax asset – provisions and accruals
(125,007)
(128,838)
229,607
168,877
-
-
104,600
40,039
2,590,774
2,518,154
122,888
84,992
Unrecognised deferred tax liabilities – exploration and evaluation
(1,256,940)
(1,134,384)
Unrecognised deferred tax liabilities – capital raising costs
Net Unrecognised deferred tax assets
(245,541)
(234,058)
1,211,181
1,234,704
Deferred tax assets have not been brought to account as it is not probable within the immediate future that tax profits will
be available against which deductible temporary differences and tax losses can be utilised. The benefit of the tax losses
will only be obtained if the Group complies with conditions imposed by the tax legislation in Australia.
NOTE 4: AUDITOR’S REMUNERATION
Remuneration of the auditor for auditing or reviewing the financial report
18,270
20,335
NOTE 5: LOSS PER SHARE
a.
Reconciliation of loss to profit or loss
Profit/(loss)
Loss used to calculate basic EPS
b.
Weighted average number of ordinary shares outstanding during the
year used in calculating basic EPS
(349,970)
(468,501)
(349,970)
(468,501)
381,187,732 345,352,043
Diluted loss per share has not been calculated as the result does not increase loss per share.
ASX Code: CNJ
Page 24 of 39
Annual Report for Year Ending 30 June 2020
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2020
NOTE 6: KEY MANAGEMENT PERSONNEL COMPENSATION
a.
Names and positions held of key management personnel in office at any time during the financial year:
Person
Position
Person
Position
Gregory H Solomon
Chairman
James B Richardson
Non-Executive Director
Douglas H Solomon
Non-Executive Director
Guy T Le Page
Non-Executive Director
Aaron P Gates
Company Secretary/CFO
Key management personnel remuneration is included in the Remuneration Report of the Directors’ Report.
b.
Options and Rights Holdings
Number of Options Held by Key Management Personnel
Balance
1.7.2019
Granted as
Compen-
sation
Options
Exer-
cised
Net
Change
Other*
Balance
30.6.2020
Total
Vested
30.6.2020
Total Exer-
cisable
30.6.2020
Total Unexer-
cisable
30.6.2020
Gregory H Solomon
4,888,185
Douglas H Solomon
4,688,985
Guy T Le Page
3,333,357
James B Richardson 2,877,083
Aaron P Gates
2,000,000
Total
17,787,610
-
-
-
-
-
-
-
-
-
-
-
-
1,200,000
6,088,185 6,088,185 6,088,185
1,000,000
5,688,985 5,688,985 5,688,985
-
-
-
3,333,357 3,333,357 3,333,357
2,877,083 2,877,083 2,877,083
2,000,000 2,000,000 2,000,000
2,200,000 19,987,610 19,987,610 19,987,610
*Net Change Other refers to options that have been purchased, sold, lapsed or issued during the year
-
-
-
-
-
-
c.
Shareholdings
Number of Shares held by Key Management Personnel
Balance
30.6.2019
Received as
Compen-
sation
Options
Exercised
Net Change
Other*
Balance
30.6.2020
Gregory H Solomon
Douglas H Solomon
Guy T Le Page
James B Richardson
Aaron P Gates
Total
25,993,654
24,200,860
17,185,859
29,377,083
-
96,757,456
-
-
-
-
-
-
-
-
-
-
-
-
*Net Change Other refers to shares purchased or sold during the financial year.
d.
Remuneration
Refer to disclosures contained in the Remuneration Report section of the
Directors’ Report. The totals of remuneration paid to key management
personnel of the Group during the year are as follows:
Short-term employee benefits
Post-employment benefits
Other long-term benefits
Termination benefits
Share-based payments
Total
1,200,000
27,193,654
1,000,000
25,200,860
-
-
-
17,185,859
29,377,083
-
2,200,000
98,957,456
Consolidated
2020
$
2019
$
168,000
168,000
15,960
15,960
-
-
-
-
-
-
183,960
183,960
ASX Code: CNJ
Page 25 of 39
Annual Report for Year Ending 30 June 2020
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2020
NOTE 7: CASH AND CASH EQUIVALENTS
Cash at bank
Reconciliation of cash
Cash at the end of the financial year as shown in the consolidated statement of
cash flows is reconciled to items in the balance sheet as follows:
Cash and cash equivalents
NOTE 8: TRADE AND OTHER RECEIVABLES
Other receivables
NOTE 9: PROPERTY, PLANT AND EQUIPMENT
Equipment:
At cost
Accumulated depreciation
Total Plant and Equipment
Consolidated
2020
$
2019
$
171,401
131,063
171,401
131,063
171,401
131,063
171,401
131,063
16,599
16,599
10,676
10,676
46,100
46,100
(40,320)
(39,301)
5,780
6,799
a.
Movements in Carrying Amounts
Movement in the carrying amount between the beginning and the end of the current financial year.
Opening balance
Assets written off
Depreciation expense
Closing balance
b.
Impairment losses
6,799
-
8,124
(126)
(1,019)
(1,199)
5,780
6,799
The total impairment loss recognised in the consolidated statement of profit or loss and other comprehensive income
during the current year amounted to $Nil (2019: $Nil).
NOTE 10: EXPLORATION AND EVALUATION
Balance at the beginning of the financial year
Expenditure incurred during the year
Movement in rehabilitation provision
Balance at the end on the financial year
15,469,981 15,107,046
472,701
362,935
(12,500)
-
15,930,182 15,469,981
Capitalised costs amounting to $472,701 (2019: $362,935) have been included in cash flows from investing activities in
the statement of cash flows for the consolidated entity.
NOTE 11: JOINT OPERATION
A wholly controlled entity, Meteore Metals Pty Ltd, has a 50% interest in the Mt Thirsty Joint Venture, whose principal
activity is the development of the Mt Thirsty nickel, cobalt and manganese project. The consolidated financial
statements include the assets that the Group controls and the liabilities that it incurs in the course of pursuing the joint
operation and the expenses that the Group incurs and its share of the income that it earns from the joint operation.
ASX Code: CNJ
Page 26 of 39
Annual Report for Year Ending 30 June 2020
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2020
NOTE 11: JOINT OPERATION CONTINUED
Share of joint operation results and financial position:
Current Assets
Non-Current Assets
Total Assets
Current Liabilities
Total Liabilities
Revenue
Expenses
Profit / (Loss) before income tax
Income tax expense
Profit / (Loss) after income tax
NOTE 12: TRADE AND OTHER PAYABLES
Trade payables
Sundry payables and accrued expenses
NOTE 13: INTEREST BEARING LIABILITIES
Opening balance
Amount drawn down
Interest
Closing balance
Consolidated
2020
$
2019
$
9,583
5,184
3,478,889
3,018,688
3,488,472
3,023,872
1,462
13,962
-
23,862
48,862
-
(27,436)
(24,032)
(27,436)
(24,032)
-
-
(27,436)
(24,032)
Consolidated
2020
$
2019
$
48,356
184,365
232,721
37,113
37,640
74,753
-
393,050
8,330
401,380
-
-
-
-
This is a 3 year loan facility of $500,000 from Barra Resources Ltd to fund Stage 3 expenditure on the Mt Thirsty JV
Pre Feasibility Study. Interest at 5% per annum is calculated daily on amounts drawn down and capitalised into the
loan annually.
The loan may be repaid early and must be repaid:
(a) in full immediately upon the occurrence of a prescribed event of default under the loan agreement;
(b) if, Meteore Metals Pty Ltd transfers its interest in the Joint Venture, or there is a trade sale by or change of
control of Conico or Meteore Metals Pty Ltd, in full within 14 days of the relevant event occurring;
(c) if the final LME Cobalt Price on a day on which the London Metal Exchange is open for trading (Trading Day)
is greater than or equal to US$60,000 per tonne for 15 consecutive Trading Days at any time during the Term,
in full within 90 days thereof (unless Conico (or any of its subsidiaries) has been unable, despite use of
reasonable endeavours, to raise an amount equal to the aggregate of $1,000,000 plus the outstanding
amount of the loan and all accrued interest (“Minimum Capital Amount”) prior to the expiration of this 90 day
period);
(d) if the aggregate net amount of any and all capital raisings conducted by Conico (and its subsidiaries) during
the Term is greater than $1,000,000, in full or (if a lesser amount) in part by an amount equal to 20% of such
Conico capital raisings above an aggregate of $1,000,000, within 7 days of receipt of cleared funds;
(e) in full at the end of the Term, if the loan has not already been repaid, provided that if Conico has not raised
more than the Minimum Capital Amount and repaying the loan would see Conico’s cash balance fall below
$500,000, Meteore Metals Pty Ltd may, at its discretion, cause the loan and accrued interest (or part thereof)
to be repaid in Conico shares at a 10 day weighted average price.
ASX Code: CNJ
Page 27 of 39
Annual Report for Year Ending 30 June 2020
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2020
NOTE 14: PROVISIONS
Opening balance
Movements
Closing balance
2020
$
2019
$
275,000
275,000
(12,500)
-
262,500
275,000
This mainly relates to a provision of $250,000 that has been recognised in relation to the Group’s 50% share of the
liability to pay the original owners of the Mt Thirsty project $500,000 upon the commencement of mining on the
tenements. The directors believe this will not become due for at least a couple of years. This amount has not been
recorded at present value as a timeframe for discounting is not determinable. The remaining balance relates to a
rehabilitation provision.
NOTE 15: ISSUED CAPITAL
384,398,221 (2019: 351,758,253) ordinary shares
20,394,350
20,085,785
2014
2020
2012$ 2019
No.
No.
No.
2020
$
2019
$
a.
Ordinary shares
At the beginning of reporting period
351,758,253
323,493,387
20,085,785
19,282,403
Shares issued during the year net of costs
32,639,968
28,264,866
308,565
803,382
At reporting date
384,398,221
351,758,253
20,394,350
20,085,785
Ordinary shares participate in dividends and in the proceeds of winding up in proportion to the number of shares held.
At the shareholders’ meetings each ordinary share is entitled to one vote when a poll is called, otherwise each
shareholder has one vote on a show of hands. The Company has no authorised share capital or par value. All issued
shares are fully paid.
b.
Options
At the beginning of reporting period
Issued during the year
Options lapsed during the year
Options exercised during the year
At reporting date
c.
Capital Management
2020
2019
73,139,866 44,875,000
- 28,264,866
(30,875,000)
-
-
-
42,264,866 73,139,866
Management controls the working capital of the Company in order to maximise the return to shareholders and
ensure that the Company can fund its operations and continue as a going concern. Management effectively
manages the Company’s capital by assessing the Company’s financial risks and adjusting its capital structure in
response to changes in these risks and in the market. These responses include the management of expenditure
and debt levels, distributions to shareholders and capital raisings. There have been no changes in the strategy
adopted by management to control the capital of the Company since the prior year.
NOTE 16: RESERVES
a.
Option Reserve
The option reserve records items recognised as expenses on valuation of share options.
NOTE 17: CONTROLLED ENTITIES
Controlled Entities
Meteore Metals Pty Ltd
ASX Code: CNJ
Country of
Incorporation
Australia
Percentage Owned (%)*
2020
100
2019
100
Page 28 of 39
Annual Report for Year Ending 30 June 2020
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2020
NOTE 18: PARENT COMPANY INFORMATION
a.
Parent Entity
Assets
Current assets
Non-current assets
Total Assets
Liabilities
Current liabilities
Non-current liabilities
Total liabilities
Equity
Issued capital
Accumulated losses
Reserves
Option reserve
Total reserves
Financial performance
Profit / (Loss) for the year
Other comprehensive income
Total comprehensive loss
Contingent Liabilities and Commitments
2020
$
2019
$
164,642
129,321
14,686,578 14,685,331
14,851,220 14,814,652
231,385
52,607
-
-
231,385
52,607
20,394,350 20,085,785
(6,563,165)
(6,112,390)
788,650
788,650
788,650
788,650
(450,774)
(524,621)
-
-
(450,774)
(524,621)
The Directors are not aware of any contingent liabilities or capital commitments as at 30 June 2020.
Guarantees in respect of the debts of its subsidiaries
There are no parent entity guarantees in respect of the debts of its subsidiary at year end.
NOTE 19: CAPITAL AND LEASING COMMITMENTS
a.
Capital Expenditure Commitments
Payable:
—
—
not later than 12 months
greater than12 months
Consolidated
2020
$
2019
$
-
-
-
20,000
-
20,000
b.
Exploration Expenditure Commitments
In order to maintain current rights of tenure to exploration tenements, the company is required to perform
minimum exploration work to meet the requirements specified by various State governments. It is anticipated
that expenditure commitments for the twelve months will be tenement rentals of $6,579 (2019: $6,851) and
exploration expenditure of $67,000 (2019: $67,000), of which the Group is required to meet 50% of.
ASX Code: CNJ
Page 29 of 39
Annual Report for Year Ending 30 June 2020
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2020
NOTE 20: SHARE-BASED PAYMENTS
All options granted to personnel are over ordinary shares in Conico Ltd, which confer a right of one ordinary share for
every option held. When issued, the shares carry full dividend and voting rights.
2020
Share-based payments - Options
2019
Number of
Options
Number of
Options
Weighted
Average
Exercise
Price
$
Weighted
Average
Exercise
Price
$
Outstanding at the beginning of the year
14,000,000
0.055
14,000,000
0.055
Granted
Exercised
Lapsed
Outstanding at year-end
Exercisable at year-end
-
-
-
-
-
-
-
-
-
-
-
-
14,000,000
0.055
14,000,000
0.055
14,000,000
0.055
14,000,000
0.055
The options outstanding at 30 June 2020 had a weighted average exercise price of $0.055 and a weighted average
remaining contractual life of 0.3 years.
Historical volatility has been the basis for determining expected share price volatility as it is assumed that this is
indicative of future tender, which may not eventuate. Volatility of 100% and a risk free rate of 1.61% were used in the
Black-Scholes model to calculate the fair values which ranged from $0.2 to $0.242 per option. The life of the options is
based on the historical exercise patterns, which may not eventuate in the future.
No options were exercised during the year ended 30 June 2020.
NOTE 21: CASH FLOW INFORMATION
a. Reconciliation of Cash Flow from Operations with Loss after Income Tax
Loss after income tax
Non-cash flows in profit/(loss)
Depreciation
Assets written-off
Interest expense capitalised
Changes in assets and liabilities, net of non-cash payments
(Increase)/decrease in trade and term receivables*
Increase/(decrease) in trade payables and accruals*
Cash flow used in operations
* - Net of Exploration and Evaluation cash flows.
b. Reconciliation of liabilities from financing activities
2020
$
2019
$
(349,970)
(468,501)
1,019
1,199
-
8,330
126
-
(5,923)
642
157,968
(8,596)
(188,576)
(475,130)
2020
Opening Balance
Drawdowns
Non-cash movements
Closing Balance
Loan from Barra Resources Ltd
Total
2019
$
-
-
$
393,050
393,050
$
8,330
8,330
$
401,380
401,380
Opening Balance
Drawdowns
Non-cash movements
Closing Balance
$
$
$
$
Loan from Barra Resources Ltd
Total
-
-
-
-
-
-
-
-
ASX Code: CNJ
Page 30 of 39
Annual Report for Year Ending 30 June 2020
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2020
NOTE 22: RELATED PARTY TRANSACTIONS
Transactions between related parties are on normal commercial terms and conditions no
more favourable than those available to other parties unless otherwise stated.
2020
$
2019
$
Transactions with related parties:
Key Management Personnel
Management fees and administration fees paid to Princebrook Pty Ltd, a company in
which Mr GH Solomon and Mr DH Solomon have an interest. At 30 June 2020 $9,000
(2019: $12,000) was included in Trade and Other Payables owing to Princebrook Pty Ltd.
Legal and professional fees and reimbursed expenses paid to Solomon Brothers, a firm of
which Mr GH Solomon and Mr DH Solomon are partners.
Corporate advisory fees paid to RM Corporate Finance Pty Ltd, a company in which Mr G
T Le Page and Mr J B Richardson have an interest.
135,000
144,000
8,337
15,310
42,000
84,000
Associated Companies
Reimbursement to Tasman Resources Ltd (which has a 13.18% interest in the Company)
for employee costs on an hourly basis, in relation to Tasman staff utilised by the Company.
6,873
31,839
NOTE 23: SEGMENT REPORTING
Operating segments are identified based on internal reports reviewed by the chief operating decision maker/s. The
Group operates predominately in one geographical segment and one business segment, being mineral exploration and
development in Western Australia. The revenues and results of this segment are those of the Group as a whole and
are set out in the consolidated statement of profit or loss and other comprehensive income and the assets and liabilities
of the Group as a whole are set out in the consolidated statement of financial position.
NOTE 24: CONTINGENT LIABILITIES AND CONTINGENT ASSETS
The Directors are not aware of any contingent assets or contingent liabilities as at 30 June 2020.
NOTE 25: EVENTS AFTER THE BALANCE SHEET DATE
The impact of the Coronavirus (COVID-19) pandemic is ongoing and whilst it has had no financial impact for the Group
up to 30 June 2020, it is not practicable to estimate the potential impact, positive or negative, after the reporting date.
The situation is rapidly developing and is dependent on measures imposed by the Australian Government and other
countries, such as maintaining social distancing requirements, quarantine, travel restrictions and any economic
stimulus that may be provided.
On 29 July 2020 the Company executed a Binding Term Sheet, subject to shareholder approval, to acquire Longland
Resources Ltd (“Longland”) in consideration of 120,000,000 Conico Ltd shares. Longland has a 100% interest in the
Ryberg Project and the Mestervig Project in Greenland.
No other matters or circumstances have arisen since the end of the financial year which significantly affected or may
significantly affect the operations of the Group, the results of those operations, or the state of affairs of the Group in
future financial years
NOTE 26: FINANCIAL INSTRUMENTS
Financial Risk Exposures and Management
The main risks the Company is exposed to through its financial instruments are interest rate risk, liquidity risk and credit
risk.
i.
Interest Rate Risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate
because of changes in market interest rates. The Group has minimal exposure to interest rate risk, the
only asset / liability affected by changes in market interest rates is Cash and cash equivalents.
The Company’s exposure to interest rate risk and effective weighted average interest rates on classes of
financial assets and financial liabilities, is as follows:
ASX Code: CNJ
Page 31 of 39
Annual Report for Year Ending 30 June 2020
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2020
NOTE 26: FINANCIAL INSTRUMENTS CONTINUED
Weighted
Average
Effective
Interest Rate
2020
2019
Floating Interest
Rate
Fixed Interest
Rate
Non-Interest
Bearing
Total
2020
$
2019
$
2020
$
2019
$
2020
$
2019
$
2020
$
2019
$
Financial
Assets:
Cash and cash
equivalents
Trade and other
receivables
Total Financial
Assets
Financial
Liabilities:
Trade and sundry
payables
Interest bearing
liabilities
Total Financial
Liabilities
-
ii.
Liquidity Risk
0.05% 0.60% 171,401 131,063
-
-
-
-
0.05% 0.60% 171,401 131,063
-
-
-
-
-
-
-
-
171,401 131,063
16,599
10,676
16,599
10,676
16,599
10,676
188,000 141, 739
-
5.00%
-
-
-
-
-
-
-
-
- 232,721
74,753
232,721
74,753
- 401,380
-
-
-
401,380
-
- 401,380
- 232,721
74,753
634,101
74,753
The Company manages liquidity risk by monitoring forecast cash flows and ensuring that adequate
funding is maintained. The Company’s operations require it to raise capital on an on-going basis to
fund its planned exploration program and to commercialise its tenement assets. If the Company does
not raise capital in the short term, it can continue as a going concern by reducing planned but not
committed exploration expenditure until funding is available and/or entering into joint venture
arrangements where exploration is funded by the joint venture partner. All financial liabilities and assets
are expected to be realised and settled within 6 months, except for the borrowings which are expected
to be settled within 3 years.
The remaining contractual maturities of the Group financial liabilities are:
12 months or less
1 year or more
Total
iii. Credit risk
2020
$
2019
$
232,721
74,753
401,380
-
634,101
74,753
Credit risk refers to the risk that the counterparty will default on its contractual obligations resulting in a
financial loss to the Company. The Company has adopted a policy of only dealing with credit-worthy
counterparties and obtaining sufficient collateral or other security where appropriate, as a means of
mitigating the risk of financial loss from defaults.
The maximum exposure to credit risk, excluding the value of any collateral or other security, at balance
date to recognised financial assets, is the carrying amount, net of any provisions for impairment of those
assets, as disclosed in the balance sheet and notes to the financial statements.
The Company does not have any material credit risk exposure to any single receivable or group of
receivables under financial instruments entered into by the company.
ASX Code: CNJ
Page 32 of 39
Annual Report for Year Ending 30 June 2020
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2020
NOTE 27: COMPANY DETAILS
The registered office of the company is:
The principal place of business is:
Conico Ltd
Level 15,
Conico Ltd
Level 15,
197 St Georges Terrace
Perth Western Australia 6000
197 St Georges Terrace
Perth Western Australia 6000
ASX Code: CNJ
Page 33 of 39
Annual Report for Year Ending 30 June 2020
DIRECTORS’ DECLARATION
In the opinion of the directors of Conico Ltd (the “Company”):
a.
the financial statements and notes set out on pages 15 to 33, and the Remuneration disclosures that are contained
in pages 11 to 12 of the Remuneration Report in the Directors’ Report, are in accordance with the Corporations Act
2001, including:
(i)
(ii)
giving a true and fair view of the Group’s financial position as at 30 June 2020 and of its performance, for
the financial year ended on that date; and
complying with Australian Accounting Standards (including the Australian Accounting Interpretations) and
the Corporations Regulations 2001; and
(iii)
complying with International Financial Reporting Standards as disclosed in Note 1.
the remuneration disclosures that are contained in pages 11 to 12 of the Remuneration Report in the Directors’
Report comply with Australian Accounting Standard AASB 124 Related Party Disclosures, and
there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become
due and payable.
b.
c.
The Directors have been given the declarations required by Section 295A of the Corporations Act 2001 from the
Non-Executive Chairman and Chief Financial Officer for the financial year ended 30 June 2020.
This declaration is made in accordance with a resolution of the Board of Directors.
Gregory H Solomon
Chairman
Dated this 10th day of August 2020
ASX Code: CNJ
Page 34 of 39
Independent Auditor’s Report to the Members of Conico Limited
Report on the financial report
Opinion
We have audited the financial report of Conico Limited (the Company and its subsidiaries (the Group)),
which comprises the consolidated statement of financial position as at 30 June 2020, the consolidated
statement of comprehensive income, consolidated statement of changes in equity and consolidated
statement of cash flows for the year then ended, and notes to the financial statements, including a
summary of significant accounting policies, and the directors’ declaration.
In our opinion, the accompanying financial report of the Company is in accordance with the
Corporations Act 2001, including:
(i)
giving a true and fair view of the Group’s financial position as at 30 June 2020 and of its
financial performance for the year then ended; and
(ii)
complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial
Report section of our report. We are independent of the Company in accordance with the auditor
independence requirements of the Corporations Act 2001 and the ethical requirements of the
Accounting Professional & Ethical Standards Board’s APES 110 Code of Ethics for Professional
Accountants (including Independence Standards) (the Code) that are relevant to our audit of the
financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with
the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has been
given to the directors of the Company, would be in the same terms if given to the directors as at the
time of this auditor’s report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Material uncertainty related to going concern
Without modifying our opinion, we draw attention to Note 1 to the financial report, which indicates that
the Group will require further funding in the next twelve months from the date of this report to fund its
planned exploration and evaluation projects and operating costs. These conditions, along with other
matters as set forth in Note 1, indicate the existence of a material uncertainty that may cast significant
doubt about the Group’s ability to continue as a going concern and therefore the Group may be unable
to realise its assets and discharge its liabilities in the normal course of business. Our opinion is not
modified in respect of this matter.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in
our audit of the financial report of the current period. These matters were addressed in the context of
our audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide
a separate opinion on these matters. In addition to the matter described in the ‘Material uncertainty
related to going concern’ section, we have determined the matter described below to be the key audit
matter to be communicated in our report.
Key audit matter
How our audit addressed the key audit
matter
Capitalisation
evaluation assets
of
Exploration
and
Refer to Note 10 (Exploration and
evaluation)
As at 30 June 2020 the carrying value of
Exploration and evaluation assets was
$15,930,182 (2019: $15,469,981). The Group’s
accounting policy in respect of exploration and
evaluation assets is outlined in Note 1e.
This is a key audit matter due to the fact that
significant judgement is applied in determining
the capitalised exploration and
whether
evaluation assets continue
the
recognition criteria
in terms of AASB 6
Exploration for and Evaluation of Mineral
Resources.
to meet
procedures
Our
evaluating
focussed
management’s assessment of the exploration and
evaluation asset’s
value. These
procedures included, amongst others:
carrying
on
verifying whether the rights to tenure of the
area of interest remained current at balance
date;
obtaining evidence of the future intention for
the area of interest; and
obtaining an understanding of the status of
ongoing exploration programmes for the
area of interest.
We also assessed the appropriateness of the
accounting treatment and disclosure in terms of
AASB 6.
Other information
The directors are responsible for the other information. The other information comprises the information
in Conico Limited’s annual report for the year ended 30 June 2020, but does not include the financial
report and the auditor’s report thereon.
Our opinion on the financial report does not cover the other information and we do not express any
form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of the
other information we are required to report that fact. We have nothing to report in this regard.
Directors’ responsibility for the financial report
The directors of the Company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001
and for such internal control as the directors determine is necessary to enable the preparation of the
financial report that gives a true and fair view and is free from material misstatement, whether due to
fraud or error.
In preparing the financial report, the directors are responsible for assessing the entity’s ability to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless the directors either intend to liquidate the entity or to cease
operations, or have no realistic alternative but to do so.
Auditor’s responsibility for the audit of the financial report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes
our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit
conducted in accordance with the Australian Auditing Standards will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material
if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of this financial report.
A further description of our responsibilities for the audit of the financial report is located at The
Australian
at:
http://www.auasb.gov.au/auditors_responsibilities/ar2.pdf. This description forms part of our auditor’s
report.
Assurance
Standards
Auditing
website
Board
and
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 11 to 12 of the Directors’ Report for the
year ended 30 June 2020.
In our opinion, the Remuneration Report of Conico Limited for the year ended 30 June 2020, complies
with Section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the Remuneration
Report in accordance with Section 300A of the Corporations Act 2001. Our responsibility is to express
an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian
Auditing Standards.
Nexia Perth Audit Services Pty Ltd
M. Janse Van Nieuwenhuizen
Director
Perth
10 August 2020
Annual Report for Year Ending 30 June 2020
ADDITIONAL INFORMATION FOR LISTED PUBLIC COMPANIES
1. Shareholding as at 31 July 2020
a. Distribution of Shareholders
Category (size of holding)
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 – and over
Number of
Shareholders
41
53
119
430
279
922
b.
c.
The number of shareholdings held in less than marketable parcels at 31 July 2020 is 483.
The names and relevant interests of the substantial shareholders listed in the holding company’s register as at 31
July 2020 are:
Shareholder
Tasman Resources Ltd
J Richardson
Arkenstone Pty Ltd
March Bells Pty Ltd
d. Voting Rights
Number of Ordinary shares
50,660,821
29,377,083
27,193,654
25,200,860
Each ordinary share is entitled to one vote when a poll is called, otherwise each member present at a meeting or
by proxy has one vote on a show of hands.
e
20 Largest Shareholders — Ordinary Shares
Name
Tadea Pty Ltd
Tasman Resources Ltd
1.
2. Arkenstone Pty Ltd
3. March Bells Pty Ltd
4. Guy Le Page & Dina Le Page
5. Red Eight Pty Ltd
6.
7. Redcode Pty Ltd
8. Bennelong Resource Capital Pty Ltd
9. D M Middleton Pty Ltd
10. Norman & Megan Parker < Parker Superfund A/C>
11. Apostman Superannuation Pty Ltd
12. Matthew Torenius & Oliver Torenius
13. Peto Pty Ltd <1953 Superfund A/c>
14. ASB Nominees Limited <123619 A/c>
15. Anthony Ford
16. Mainbreak Securities Pty Ltd
17. J P Morgan Nominees Australia Pty Limited
18. Flourish Super Pty Ltd
19. Anna De Lucia
20. Pennock Pty Ltd
Number
Shares Held
% of Issued
Capital
50,660,821
27,193,654
25,200,860
17,185,867
15,250,000
14,127,083
10,000,000
9,834,222
9,000,000
8,500,000
7,051,340
5,800,000
5,380,699
4,900,000
4,900,000
4,750,000
4,628,412
4,500,000
4,000,000
4,000,000
236,862,958
13.18%
7.08%
6.56%
4.47%
3.97%
3.68%
2.60%
2.56%
2.34%
2.21%
1.83%
1.51%
1.40%
1.27%
1.27%
1.24%
1.20%
1.17%
1.04%
1.04%
61.62%
ASX Code: CNJ
Page 38 of 39
Annual Report for Year Ending 30 June 2020
f
20 Largest CNJO Holders — Listed CNJO Options
Name
Tadea Pty Ltd
Tasman Resources Ltd
1. Bennelong Resource Capital Pty Ltd
2.
3. March Bells Pty Ltd
4. Arkenstone Pty Ltd
5. Anthony Ford
6. Peto Pty Ltd <1953 Superfund A/c>
7. Redcode Pty Ltd
8.
9. Norman & Megan Parker < Parker Superfund A/c>
10. GT Le Page & Associates Pty Ltd
11. Apostman Superannuation Pty Ltd
12. Guy Touzeau Le Page
13. Arkenstone Pty Ltd
14. Anna De Lucia
15. ASB Nominees Limited <123619 A/c>
16. Arkenstone Pty Ltd
17. Colin McKenzie
18. Beniris Pty Ltd
19. Yongmei Chen
20. Brett Rudd
Number
Options Held
% of Options
6,666,667
5,184,536
2,591,016
2,126,954
2,000,000
1,062,500
937,500
877,083
800,000
642,289
609,375
562,501
479,688
456,250
335,938
281,543
260,951
250,000
180,000
164,500
26,469,291
23.59%
18.34%
9.17%
7.52%
7.08%
3.76%
3.32%
3.10%
2.83%
2.27%
2.16%
1.99%
1.70%
1.61%
1.19%
1.00%
0.92%
0.88%
0.64%
0.58%
93.65%
2. Unquoted Securities – Options as at 31 July 2020
Holder Name
Date of Expiry
Exercise Price
Various
Various
28 August 2020
20 November 2020
$0.0625
$0.0488
Number on
issue
Number of
holders
6,000,000
8,000,000
14,000,000
3
4
7
TENEMENT SCHEDULE
State
Licence
Type
WA
WA
WA
WA
WA
WA
WA
EL
P
EL
R
G(A)
M(A)
M(A)
Number
E63/1790
P63/2045
E63/1267
R63/4
G(A)63/93
M(A)63/669
M(A)63/670
Interest
%
50
50
50
50
50
50
50
Locality
Mt Thirsty
Mt Thirsty
Mt Thirsty
Mt Thirsty
Mt Thirsty
Mt Thirsty
Mt Thirsty
Location
Approximately 20 km NW of Norseman
Approximately 20 km NW of Norseman
Approximately 20 km NW of Norseman
Approximately 20 km NW of Norseman
Approximately 20 km NW of Norseman
Approximately 20 km NW of Norseman
Approximately 20 km NW of Norseman
ASX Code: CNJ
Page 39 of 39