Conico Ltd
Annual Report 2021

Plain-text annual report

Level 15, 197 St Georges Terrace Perth, Western Australia 6000 Telephone: +81 8 9282 5889 Email: mailroom@conico.com.au Website: www.conico.com.au ABN 49 119 057 457 for the Year Ended 30 June 2021 Cover Photo: Cascata Prospect - Altered amphibolite with epidote (green) and oxidised sulphide (rust colour). Table of Contents Highlights for the Year to 30 June 2021 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 4 5 6 14 19 20 21 22 23 24 38 39 43 44 2 3 HIGHLIGHTS FOR THE YEAR TO 30 JUNE 2021 Greenland Exploration:  Completed acquisition of 100% of England & Wales registered Longland Resources Ltd (“Longland”).  Longland co-founder and director Mr Thomas Abraham-James appointed CEO of Longland Resources, responsible for managing and overseeing all Greenland exploration activities.  2020 Field season at Ryberg confirmed prospectivity of both Miki Fjord (Ni, Cu, Co, Pd, Au) and Sortekap (Au, Ni) prospects returning anomalous rock chips and geophysical anomalies.  Planning for 2021 field season including further reconnaissance exploration at the Mestersvig Project, diamond drilling and a project wide aeromagnetic-radiometric survey at the Ryberg Project. MT THIRSTY COBALT PROJECT:  Discussions on Native Title Agreement ongoing.  Rising cobalt and nickel prices over FY 2021 have continued to improve project economics at Mt Thirsty.  Review of existing Pre-Feasibility Study flowsheet including the examination of potential optimisation opportunities. 4 CORPORATE DIRECTORY DIRECTORS: Gregory H Solomon LLB (Non-Executive Chairman) Guy T Le Page B.A., B.Sc., B.App.Sc. (Hons), M.B.A., M.Fin.Plan., GradDipAppFin&Inv, F.FIN., MAusIMM (Executive) Douglas H Solomon B.Juris. LLB (Hons) (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 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) Quotation has been granted for all the ordinary shares of the company on all Member Exchanges of the Australian Securities Exchange Limited. 5 REVIEW OF OPERATIONS RYBERG PROJECT (100% Longland Resources Ltd – MEL2017/06 & MEL-S2019/38) FIGURE 1: Ryberg Project. 6 The Ryberg Project (Figure 1) is located on the east coast of Greenland, approximately 345km NW of Iceland and covers 4,521km2 . Previous surface geochemistry and geophysical surveys indicative the license area is highly prospective for precious and base metals. Immediately to the west of Ryberg is Major Precious Metals´ Skaergaard Project and Greenland Silver Moly Resources´ Flammefjeld Project. Abundant surficial occurrences of magmatic sulphide mineralisation (Cu-Ni-Co-Pd-Au) have been identified at Ryberg with the most advanced prospect known as the Miki Prospect. Another prospect known as Sortekap has returned elevated gold and nickel rock chip results associated with an interpreted Archean greenstone shear zone. ACCESS Access is via vessel, or aircraft that can land within the licence area at an airstrip that is serviced by an Icelandic aviation company. The project is not located within a National Park, nor is it nearby to a population centre, with the nearest town of Ittoqqortoormiit being 350km to the NE. PROSPECTS Miki Prospect (Cu-Ni-Co-Pd-Au)  Lithologies: Numerous mafic/ultramafic intrusions hosted in a sedimentary basin.  Mineralisation: Visible globular magmatic sulphide mineralisation at surface.  Geochemistry: Surface rock-chip samples grading up to 2.2% Cu, 0.8% Ni, 0.1% Co, 3.3g/t Pd and 0.2g/t Au.  Targets: Three electro-magnetic (EM) geophysical targets at 80-200 metres vertical depth. FIGURE 2: EM targets at the Miki Prospect. FIGURE 3: Cu-Pd-Au rich magmatic sulphide (circled) at the Miki Prospect. 7 Sortekap Prospect (Au-Ni)  Lithologies: Archaean greenstones containing abundant quartz veins and ultramafic intrusions.  Visible Mineralisation: Sulphide-bearing veins containing gold, and nickel-bearing sulphides at surface.  Geochemical anomalies: Surface rock-chip sampling grades up to 2.7g/t Au & 0.3% Ni.  Targets: Induced Polarisation (IP) targets. ACTIVITIES 2020 field season Thomas Abraham-James Field personnel were on site over August and September 2020, including Longland director and geologist 4), geophysical technicians, field assistants and pilots. On the Miki magmatic sulphide target a total of 74 electromagnetic (EM) geophysical survey stations were completed, and surface rock chips collected for analysis. At the Sortekap gold prospect further surface rock chip samples were sent for analysis and an induced polarisation (IP) survey was undertaken. (Figure FIGURE 4: Longland Resources CEO Thomas Abraham- James. RESULTS Miki Prospect The EM data was processed and interpreted by an independent geophysicist, with no evident false-positive anomalies detected. The standout target is ME1 (Figure 2), with modelled plates forming a half U shape gently dipping to the northeast that is interpreted to represent a chonolith with sulphides present at its base (refer Figure 3). The interpreted chonolith is oriented adjacent to the Miki Fjord Dyke, trending ENE-WSW and is approximately 300m wide, and is greater than 300m in length – total length being unknown as it is open to the west where it was not covered by the survey. The EM signal and knowledge of the surrounding geology suggests that the sulphides present are most likely copper dominant, with appreciable amounts of palladium and gold. Sortekap Prospect The IP survey identified a large chargeable feature (Figure 5) that extends from the southern margin of the survey area, to approximately the mid-point, a length of ~1km. This feature is interpreted to be a geological structure (fault or shear) containing chargeable sulphides that is open at depth and along strike. It dips approximately 30˚ south and is obscured from surface by approximately 20 vertical metres. The chargeability readings are high, particularly in comparison to its surrounds and are likely to be due to greater than 5% sulphide content (most abundant sulphides being pyrite and chalcopyrite). Gold assays for the surface rock-chips retuned four samples grading over 0.1g/t gold, with the highest concentration being 2.7g/t. The gold-bearing samples occur in amphibolite containing sulphides and garnet, giving a mineralogical (therefore visual) constraint on the likely zone of gold concentration. 8 FIGURE 5: IP anomaly at the Sortekap Prospect, Ryberg Project. MESTERSVIG PROJECT (100% Longland Resources Ltd – MEL2020/64 & MEL-S 2021/24) The Mestersvig Project (Figure 6) is located on the east coast of Greenland, approximately 620km NW of Iceland. The licence was granted in the reporting period and covers an area of 1,447km2. Within the license area is Greenland Resources’ Malmbjerg molybdenum project, and to the north and south is Greenfield Exploration and Independence Group Ltd’s (ASX: IGO) Frontier copper project. Adjacent to the Mestersvig Project is the Mestersvig Danish military base, complete with airstrip and harbour. 9  FIGURE 6: Mestersvig Project, showing surface samples and gravity coverage. Travel to site is by aircraft from Iceland to Constable Point Airport (located 150km south) and then onward to Mestersvig via either helicopter or fixed wing flight. Travel within the Project is either by foot, ATV or helicopter. 10 ACTIVITIES Field personnel were on site in August-September 2020, consisting of Longland director and geologist Thomas Abraham-James, geophysical technicians, field assistants and pilot. A total of 2,344 gravity stations were achieved at 50m spacing and 200m between lines, with surface rock chips collected and sent for analysis. FIGURE 7: Mestersvig Project, rock chip sample 4958 showing massive galena hosted in a quartz vein. RESULTS Nuldal Prospect Field personnel traversed this vein from the coastline, up the mountainside where outcrop was discovered containing massive galena (lead sulphide), hosted in a quartz vein. Two surface rock-chip samples were collected and sent for analysis. The results are show below in Table 1, and a photo of sample 4958 in Figure 7. Sample ID Easting 605,732 605,730 4958 4959 Northing 8,007,379 8,007,381 Year 2020 2020 Ag g/t 236 282 Cu % 0.91 0.77 Pb % 60.66 69.47 S % 7.32 9.58 Zn % 0.03 0.03 TABLE 1: Assay results for 2020 Nuldal surface samples The vein also extends to the north into an area referred to as ‘Little Lead Valley’. While no analytical results are present, a report from 1952 states “…several small fissure veins outcrop in the steep western walls of Blyryggen, between 600-700m above sea-level. Some of them contain lead sulphide…”. The total strike length of the ‘Little Lead Valley’ veins and Nuldal combined is 4.5km. The gravity covers the southern extent of the Nuldal Prospect, where the vein becomes obscured by scree. There is a distinct gravity high in this location, showing what appears to be a linear feature that then bends to the southwest and has a strike length of 2km (when combined with the ‘Little Lead Valley’ and Nuldal veins, this gives a total prospective strike length of 6.5km. The gravity anomaly is in an accessible location on flat ground nearby to Mestersvig Bay. Sortebjerg Prospect The Sortebjerg Prospect is located 10km south of the Blyklippen Mine and consists of a mineralised quartz vein that contains dominantly sphalerite (zinc sulphide) mineralisation, with subordinate galena and chalcopyrite (copper sulphide). The vein outcrops at surface in four locations, over a strike length of approximately 2.9km. Four samples (Table 2) were sent for assay and the most anomalous results being 8.35% zinc (sample 4954), and 6.96% copper & 3.42% lead (sample 4956). Sample ID Sample Type 4954 4955 4956 4957 Rock chip Rock chip Rock chip Rock chip Cu% 0.03 <0.01 6.96 0.03 Pb% 0.28 0.01 3.42 <0.01 Zn% 8.35 0.02 0.016 <0.01 TABLE 2: Assay results for 2020 Sortebjerg surface samples. 11 Blyklippen Historic Mine unexpected and welcome An finding the historic discovery was mine’s core that facility storage contains surface and underground drill core from the mine and surrounds that is remarkably intact (Figure 8). The gravity response at Blyklippen has a pronounced gravity low which is likely due the historic mining operation where the opencut and underground operations removed the mineralised vein. to FIGURE 8: Core shed at the Blyklippen Mine, Mestersvig Project. MT THIRSTY COBALT PROJECT (50% Conico Ltd (operator): 50% Barra Resources Ltd – Joint Venture, MTJV) FIGURE 9: Mt Thirsty Project, Norseman, Western Australia. The Mt Thirsty Cobalt Project is located 16km north-northwest of Norseman, Western Australia (Figure 9). 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. 12 The Mt Thirsty project is close to all necessary infrastructure (rail, road, power, water, and seaport) 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. A Pre-Feasibility Study (PFS) was completed in 2020 which demonstrated the significant potential at the MTJV. Highlights included:  Hydrometallurgical process is at atmospheric pressure and 70-90ºC utilising sulphur dioxide (SO2) as the main reagent.   Study was based on a 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. Constructive discussions have also been held with the traditional owners the Ngadju and the MTJV is optimistic in respect to finalising a Native Title agreement in calendar year 2021. 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 contained in this report relating to exploration results for the Greenland projects is based on information compiled or reviewed by Thomas Abraham-James, the CEO of Longland Resources Ltd. Mr. Abraham-James has a B.Sc. Hons (Geol) and is a Chartered Professional (CPGeo) and Fellow of the Australasian Institute of Mining and Metallurgy (FAusIMM). Mr. Abraham-James has sufficient experience of relevance to the styles of mineralisation and the types of deposit under consideration, and to the activities undertaken to qualify as a Competent Person as defined in the 2012 edition of the Joint Ore Reserve Committee (JORC) “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Mr. Abraham-James consents to the inclusion in this report of the matters based on information in the form and context in which it appears. 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. 13 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 financial year ended 30 June 2021. 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 13 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 during the financial year ended 30 June 2021 was mineral exploration. On 2 November 2020 Conico successfully acquired 100% of the issued capital of Longland Resources Limited (“Longland”), the 100% owner of the Ryberg and Mestersvig Projects in Greenland. There were no other 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 $995,140 (2020: $349,970). Cash outflow from operating activities was $596,820 (2020: $188,576). 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 during the year ended 30 June 2021 is set out in the Review of Operations on Page 6. Financial position The net assets of the Group have increased by $10,654,882 from 30 June 2020, to $25,882,243 in 2021. This increase is largely due to the acquisition of Longland Resources Ltd and capital raisings completed 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 On 3 September 2021 and 17 September 2021 shares were issued (16,847,833 in total) pursuant to options being exercised, raising $698,413. On 15 September 2021 the Company announced a placement and non-renounceable rights-issue to raise $7 million by the issue of CNJ shares at $0.06 each together with one for two free attaching options to acquire Shares at 10 cents each on or before 30 November 2024. On 22 September 2021, the 67,000,000 placement shares and options were issued, raising $4,020,000. 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. 14 Information on Directors Gregory H Solomon Qualifications Experience Non-Executive Chairman 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 two mining/exploration companies. including Interest in Shares and Options Directorships held in other listed entities 38,469,448 Ordinary Shares Eden Innovations Ltd Tasman Resources Ltd Guy T Le Page Qualifications Experience Executive B.A., B.Sc.. B.App.Sc. (Hons).,M.B.A., M.Fin.Plan, GradDipAppFin&Inv, 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 26,800,661 Ordinary Shares Directorships in other listed entities Mt Ridley Mines Ltd, Tasman Resources Ltd Douglas H Solomon Qualifications Experience Non-Executive BJuris LLB (Hons) Board member since 30 March 2006. A Barrister and Solicitor with more than 30 years’ experience in the areas of mining, corporate, commercial and property law. He is a partner in the legal firm, Solomon Brothers. Interest in Shares and Options 38,738,548 Ordinary Shares Directorships in other listed entities Eden Innovations Ltd James B Richardson Qualifications Experience Tasman Resources Ltd 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 38,750,000 Ordinary Shares Directorships in other listed entities None 15 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 Australian directors and executives receive superannuation, which was 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. 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. Details of Remuneration for Year Ended 30 June 2021 The remuneration for each director and each of the executive officers of the Group during the year was as follows: Key Management Person Short-term Benefits Post- employme nt benefits Other long-term benefits Terminatio n Benefits Share-based payments Total Salary and Fees Cash profit share Non- cash benefit Super- annuation Other Other Equity Options $ $ $ $ $ $ $ $ $ 2021 Gregory H Solomon Douglas H Solomon Guy T Le Page James B Richardson 60,000 36,000 45,000 36,000 Thomas Abraham-James (ii) 136,784 Aaron P Gates(i) 2020 Gregory H Solomon Douglas H Solomon Guy T Le Page James B Richardson Aaron P Gates(i) - 313,784 60,000 36,000 36,000 36,000 - 168,000 - - - - - - - - - - - - - - - - - 2,301 - 5,700 3,420 4,275 3,420 - - 2,301 16,815 - - - - - - 5,700 3,420 3,420 3,420 - 15,960 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 65,700 39,420 49,275 39,420 - 87,500 226,585 - 6,700 6,700 - 94,200 427,100 - - - - - - - - - - - - 65,700 39,420 39,420 39,420 - 183,960 (i) - Mr Gates 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 $144,000 (2020: $135,000) to Princebrook Pty Ltd for management services. The Management Services Agreement may be terminated by giving not less than three months’ written notice. Mr Gates received 500,000 options exercisable at $0.022 and expiring 21 September 2023. (ii) - The appointment of Mr Abraham-James may be terminated by giving not less than eight weeks written notice. Mr Abraham-James received 5,000,000 options exercisable at $0.04 and expiring 30 September 2024. 16 For the options granted during the current financial year, the valuation model inputs used to determine the fair value at the grant date, are as follows: Key Management Person Grant Date Expiry Date Share Price at Grant Date Exercise Price Expected volatility Divid- end yield Risk-free interest rate Fair value at grant date Aaron P Gates 22/9/2020 21/9/2023 $0.016 $0.022 Thomas Abraham-James 19/5/2021 30/9/2024 $0.033 $0.04 188% 100% - - 0.25% 0.25% $0.0134 $0.0175 Number of Options Held by Key Management Personnel Balance 1.7.2020 Granted as Compen- sation Options Exer- cised Net Change Other* Balance 30.6.2021 Total Vested 30.6.2021 Total Exer- cisable 30.6.2021 Total Unexer- cisable 30.6.2021 Gregory H Solomon Douglas H Solomon Guy T Le Page James B Richardson 6,088,185 5,688,985 3,333,357 2,877,083 - - - - Thomas Abraham-James - 5,000,000 Aaron P Gates 2,000,000 500,000 Total 19,987,610 5,500,000 - - - - - - - (6,088,185) (5,688,985) (3,333,357) (2,877,083) - - - - - - - - - - - - - 5,000,000 5,000,000 5,000,000 (1,800,000)** 700,000 700,000 700,000 (19,987,610) 5,700,000 5,700,000 5,700,000 - - - - - - - *Net Change Other refers to options that have been purchased, sold, lapsed or issued during the year. **This includes the lapse of 2,000,000 options during the period that were issued as remuneration and had a fair value at grant date of $50,400. Number of Shares Held by Key Management Personnel Gregory H Solomon Douglas H Solomon Guy T Le Page James B Richardson Thomas Abraham-James Aaron P Gates Total Balance 30.6.2020 Received as Compen- sation Options Exercised Net Change Other* Balance 30.6.2021 27,193,654 25,200,860 17,185,859 29,377,083 - - 98,957,456 - - - - - - - - - - - - - - 11,275,794 38,469,448 13,537,688 38,738,548 9,614,802 26,800,661 9,372,917 38,750,000 33,328,941 33,328,941 1,300,000 1,300,000 78,288,142 177,387,598 *Net Change Other refers to shares purchased, sold or other movements. Directors Meetings During the financial year, seven meetings of directors were held. Attendances by each director were as follows: Directors’ Meetings Number eligible to attend Number attended 7 7 7 7 7 7 7 7 Gregory H Solomon Douglas H Solomon Guy T Le Page James B Richardson Indemnifying Officers 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 was approximately $28,485. 17 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. 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 22 September 2020 21 September 2023 24 November 2020 24 November 2023 15 January 2021 Various 15 January 2024 20 January 2024 19 May 2021 30 September 2024 22 September 2021 30 November 2024 $0.022 $0.04 $0.04 $0.07 $0.04 $0.10 1,000,000 8,500,000 2,300,000 60,496,307 10,000,000 33,500,000 115,796,307 During the year ended 30 June 2021, 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 2021. Auditor’s Independence Declaration The auditor’s independence declaration for the year ended 30 June 2021 has been received and can be found on page 19. Signed in accordance with a resolution of the Board of Directors. Gregory H Solomon Chairman Dated this 23rd day of September 2021 18 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 2021 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 23 September 2021 19 CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME FOR YEAR ENDED 30 JUNE 2021 Other Income Accounting and audit Depreciation and amortisation Finance costs Foreign exchange gain/(loss) Insurance expense Key management remuneration Legal and other consultants Management fees Other expenses Travel and accommodation Loss before income tax Income tax benefit Loss for the year Other Comprehensive Income Items that may be reclassified to profit or loss: Foreign currency translation reserve 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 6(a) 3 Consolidated 2021 $ 2020 $ 1,132 (37,521) (5,829) (5,710) (8,086) (33,706) (382,120) (226,842) (144,000) (188,676) (43,738) (1,075,096) 79,956 (995,140) 22,963 (35,495) (1,019) (8,330) - (30,412) (183,960) (44,627) (135,000) (38,690) - (454,570) 104,600 (349,970) 21,279 - 21,279 - - - (973,861) (349,970) Basic/Diluted loss per share (cents per share) 5 (0.14) (0.09) The accompanying notes form part of these financial statements. 20 CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2021 Note Consolidated 2021 $ 2020 $ ASSETS CURRENT ASSETS Cash and cash equivalents Trade and other receivables Other current assets TOTAL CURRENT ASSETS NON-CURRENT ASSETS Property, plant and equipment Exploration and evaluation assets 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 7 8 9 10 12 13 14 15 16 3,918,252 - 311,652 4,229,904 171,401 16,599 - 188,000 54,920 5,780 22,272,897 15,930,182 22,327,817 15,935,962 26,557,721 16,123,962 412,978 412,978 - 262,500 262,500 675,478 232,721 232,721 401,380 262,500 663,880 896,601 25,882,243 15,227,361 31,425,251 20,394,350 1,407,771 788,650 (6,950,779) (5,955,639) 25,882,243 15,227,361 The accompanying notes form part of these financial statements. 21 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR YEAR ENDED 30 JUNE 2021 Consolidated Group Ordinary Share Capital Foreign Currency Translation Reserve Option Reserve Retained Earnings Total $ 20,085,785 308,565 - - - 20,394,350 11,030,901 - - - - $ - - - - - - - - - (21,279) (21,279) $ $ $ 788,650 (5,605,669) 15,268,766 - - - - - 308,565 (349,970) (349,970) - - (349,970) (349,970) 788,650 (5,955,639) 15,227,361 - 640,400 - 11,030,901 - 640,400 - - - (995,140) (995,140) - (21,279) (995,140) (1,016,419) Balance at 30 June 2019 Shares issued (net of costs) Net loss for the year Other comprehensive income Total comprehensive income / (loss) Balance at 30 June 2020 Shares issued (net of costs) Issue of options Net loss for the year Other comprehensive income Total comprehensive income / (loss) Balance at 30 June 2021 31,425,251 (21,279) 1,429,050 (6,950,779) 25,882,243 The accompanying notes form part of these financial statements. 22  CONSOLIDATED STATEMENT OF CASHFLOWS FOR THE YEAR ENDED 30 JUNE 2021 Note Consolidated 2021 $ 2020 $ CASH FLOWS FROM OPERATING ACTIVITIES Receipts from customers Payments to suppliers and employees Interest paid Interest received R&D tax rebate Net cash provided by/(used in) operating activities 22 CASH FLOWS FROM INVESTING ACTIVITIES Acquisition of subsidiary (net of cash acquired) Cash advanced for exploration costs Exploration and evaluation expenditure Payments for property, plant & equipment - (662,919) (14,041) 184 79,956 (596,820) (6,605) (1,206,240) (2,025,669) (48,785) 24,183 (317,565) - 206 104,600 (188,576) - - (472,701) - Net cash provided by/(used in) investing activities (3,287,299) (472,701) CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from loans Proceeds from share issues net of costs Repayment of loans Net cash provided by/(used in) financing activities Net increase/(decrease) in cash held Net increase/(decrease) due to foreign exchange movements Cash at beginning of financial year Cash at end of financial year 13 15 13 7 - 8,114,089 (393,050) 7,721,039 3,836,920 (90,069) 171,401 3,918,252 393,050 308,565 - 701,615 40,338 - 131,063 171,401 The accompanying notes form part of these financial statements. 23 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2021 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 International Financial Reporting Standards (IFRS). The financial report covers the consolidated group of Conico Ltd and its controlled entity as at and for the year ended 30 June 2021. 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 23 September 2021 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. The functional currency of Longland Resources Limited is British Pound Sterling. The functional currency of all other Group entities is Australian dollars. 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 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. 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. 24 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2021 c. Income Tax continued 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. 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. 25 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2021 h. Financial Instruments continued 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. 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. 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. 26 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2021 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 2021, 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. 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: 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 (2020: 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. 27 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2021 r. Critical accounting judgements, estimates and assumptions continued Exploration and evaluation costs carried forward 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 and Longland Resources Ltd is dependent on the successful development and commercial exploitation or, alternatively, the sale of the exploration assets held by the controlled entity. Acquisition of Longland Resources Ltd On 2 November 2020 Conico successfully acquired 100% of the issued capital of Longland Resources Limited (“Longland”), the 100% owner of the Ryberg and Mestersvig Projects in Greenland. Total consideration for the acquisition of Longland was 120,000,000 fully paid ordinary Conico shares. The assets and liabilities arising from acquisition are recognised at fair value which is equal to the carrying value at acquisition date. The acquisition of Longland by Conico has been treated as an asset acquisition, rather than a business combination. This was on the grounds that the transaction met the “concentration test” within AASB 3 Business Combinations. The cost of the acquisition has therefore been allocated to the assets and liabilities acquired. NOTE 2: OTHER INCOME — — interest received other income Total Other Income Consolidated 2021 $ 2020 $ 184 948 1,132 206 22,757 22,963 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 26% (2020: 27.5%) (258,736) (125,007) Tax effect of: — — — Research & development rebate Current year temporary differences not recognised Current year tax losses not recognised Income tax (expense) / benefit 79,956 482,492 (223,756) 104,600 125,007 - 79,956 104,600 28 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2021 NOTE 3: INCOME TAX BENEFIT CONTINUED b. Components of deferred tax Unrecognised deferred tax asset – losses Unrecognised deferred tax asset – provisions and accruals Consolidated 2021 $ 2020 $ 3,988,024 2,590,774 91,530 122,888 Unrecognised deferred tax liabilities – exploration and evaluation (2,017,041) (1,256,940) Unrecognised deferred tax liabilities – capital raising costs Net Unrecognised deferred tax assets (368,840) (245,541) 1,693,673 1,211,181 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 relevant tax legislation. NOTE 4: AUDITOR’S REMUNERATION Remuneration of the auditor for auditing or reviewing the financial report 14,224 18,270 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 Loss per share (995,140) (349,970) (995,140) (349,970) 691,433,579 381,187,732 (0.14) (0.09) Diluted loss per share has not been calculated as the result does not increase loss per share. NOTE 6: EMPLOYEE BENEFITS a. Employee benefits expense 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 316,085 168,000 16,815 15,960 - - 94,200 - - - 427,100 183,960 b. Share-based employee remuneration Included under employee benefits expense in the statement of profit or loss and other comprehensive income is $188,400 (2020: Nil) which relates, in full, to equity settled share-based payment transactions. All options granted to personnel/key consultants 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. 29 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2021 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: OTHER CURRENT ASSETS Prepayments NOTE 9: PLANT AND EQUIPMENT Equipment: At cost Accumulated depreciation Total Plant and Equipment a. Movements in Carrying Amounts Consolidated 2021 $ 2020 $ 3,918,252 3,918,252 171,401 171,401 3,918,252 3,918,252 171,401 171,401 311,652 311,652 - - 104,893 (49,973) 54,920 46,100 (40,320) 5,780 Movement in the carrying amount between the beginning and the end of the current financial year. Opening balance Assets purchased Acquired through purchase of subsidiary Net exchange differences Depreciation expense Closing balance b. Impairment losses 5,780 51,338 2,404 1,227 (5,829) 54,920 6,799 - - - (1,019) 5,780 The total impairment loss recognised in the consolidated statement of profit or loss and other comprehensive income during the current year amounted to $Nil (2020: $Nil). NOTE 10: EXPLORATION AND EVALUATION ASSETS Balance at the beginning of the financial year Acquired through purchase of subsidiary Expenditure incurred during the year Movement in rehabilitation provision Net exchange differences Balance at the end on the financial year 15,930,182 15,469,981 4,405,983 1,892,319 - 44,413 - 472,701 (12,500) - 22,272,897 15,930,182 Capitalised costs amounting to $2,025,669 (2020: $472,701) have been included in cash flows from investing activities in the statement of cash flows for the consolidated entity. 30 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2021 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. 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 Amount repaid Interest Closing balance Consolidated 2021 $ 2020 $ 6,409 9,583 3,493,148 3,478,889 3,499,557 3,488,472 7,592 20,092 - (5,045) (5,045) - 1,462 13,962 - (27,436) (27,436) - (5,045) (27,436) 323,438 89,540 412,978 48,356 184,365 232,721 401,380 - - 393,050 (407,090) 5,710 - 8,330 - 401,380 This was 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 calculated daily on amounts drawn down and capitalised into the loan annually. The loan was repaid in full on 14 October 2020. 31 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2021 NOTE 14: PROVISIONS Opening balance Movements Closing balance 2021 $ 2020 $ 262,500 - 262,500 275,000 (12,500) 262,500 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 $500,000 upon the commencement of mining on the tenements. The directors believe this will not become due for at least a couple of years. This amount has not been recorded at present value as a timeframe for discounting is not determinable. The remaining balance relates to a rehabilitation provision. NOTE 15: ISSUED CAPITAL 916,367,041 (2020: 384,398,221) ordinary shares 31,425,251 20,394,350 2021 2012$ 2020 No. No. 2021 $ 2020 $ a. Ordinary shares At the beginning of reporting period 384,398,221 351,758,253 20,394,350 20,085,785 Shares issued during the year net of costs 531,968,820 32,639,968 11,030,901 308,565 At reporting date 916,367,041 384,398,221 31,425,251 20,394,350 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 2021 2020 42,264,866 73,139,866 99,144,140 - (42,243,327) (30,875,000) (21,539) - 99,144,140 42,264,866 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. b. Foreign Currency Translation Reserve The foreign currency translation reserve records exchange differences arising on the translation of foreign subsidiaries. 32 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2021 NOTE 17: CONTROLLED ENTITIES Controlled Entities Meteore Metals Pty Ltd Longland Resources Ltd Country of Incorporation Australia United Kingdom Percentage Owned (%) 2021 100 100 2020 100 - NOTE 18: ACQUISITION OF SUBSIDIARIES On 2 November 2020 Conico successfully acquired 100% of the issued capital of Longland Resources Limited (“Longland”), the 100% owner of the Ryberg and Mestersvig Projects in Greenland. Total consideration for the acquisition of Longland was 120,000,000 fully paid ordinary Conico shares. The assets and liabilities arising from acquisition are recognised at fair value which is equal to the carrying value at acquisition date. The acquisition of Longland Resources Limited ("Longland") by Conico has been treated as an asset acquisition, rather than a business combination. This was on the grounds that the transaction met the “concentration test” within AASB 3 Business Combinations. The cost of the acquisition has therefore been allocated to the assets and liabilities acquired. Cash consideration (acquisition costs) Cash advanced for exploration spent Equity issued as consideration Total purchase consideration Fair value of assets acquired Assets and liabilities held at acquisition date Cash and cash equivalents Other assets Capitalised mineral exploration and evaluation expenditure Liabilities Net assets acquired NOTE 19: PARENT COMPANY INFORMATION Assets Current assets Non-current assets Total Assets Liabilities 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 33 $ 35,555 1,268,186 3,120,000 4,423,741 4,423,741 15,012 2,746 4,405,983 - 4,423,741 2021 $ 2020 $ 3,861,031 164,642 21,697,467 14,686,578 25,558,497 14,851,220 81,750 81,750 231,385 231,385 31,425,251 20,394,350 (7,377,554) (6,563,165) 1,429,050 1,429,050 788,650 788,650 (814,389) (450,774) - - (814,389) (450,774) NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2021 NOTE 19: PARENT COMPANY INFORMATION CONTINUED Contingent Liabilities and Commitments The Directors are not aware of any contingent liabilities or capital commitments as at 30 June 2021. Guarantees in respect of the debts of its subsidiaries The parent entity has provided a guarantee to Cartwright Drilling Inc. in relation to the drilling program being undertaken in Greenland by its subsidiary Longland Resources Ltd. There are no other parent entity guarantees in respect of the debts of its subsidiary at year end. NOTE 20: CAPITAL AND LEASING COMMITMENTS a. Capital Expenditure Commitments Payable: — — not later than 12 months greater than12 months b. Exploration Expenditure Commitments Consolidated 2021 $ 2020 $ - - - - - - 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 governments. It is anticipated that expenditure commitments for the twelve months will be tenement rentals of $15,000 (2020: $6,579) and exploration expenditure of $72,000 (2020: $67,000), of which the Group is required to meet 50% of. NOTE 21: SHARE-BASED PAYMENTS All options granted 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. Share-based payments - Options 2021 2020 Outstanding at the beginning of the year Granted Exercised Lapsed Outstanding at year-end Exercisable at year-end Number of Options Number of Options Weighted Average Exercise Price $ Weighted Average Exercise Price $ 14,000,000 57,000,000 0.055 0.050 - - 14,000,000 57,000,000 57,000,000 0.055 0.050 0.050 14,000,000 0.055 - - - - - - 14,000,000 0.055 14,000,000 0.055 The options outstanding at 30 June 2021 had a weighted average exercise price of $0.050 and a weighted average remaining contractual life of 2.6 years. For the options granted during the current financial year, the valuation model inputs used to determine the fair value at the grant date, are as follows: Grant Date Expiry Date 22/9/2020 21/9/2023 10/8/2020 15/1/2024 17/8/2020 24/11/2023 29/3/2021 20/1/2024 19/5/2021 30/9/2024 Share Price at Grant Date Exercise Price Expected volatility Dividend yield Risk-free interest rate Fair value at grant date $0.016 $0.013 $0.018 $0.034 $0.033 $0.022 $0.04 $0.04 $0.07 $0.04 188% 100% 100% 100% 100% - - - - - 0.25% 0.25% 0.25% 0.25% 0.25% $0.0134 $0.05 $0.071 $0.0141 $0.0175 No options were exercised during the year ended 30 June 2021. 34 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2021 NOTE 22: 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 Options expense 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 2021 $ 2020 $ (995,140) (349,970) 5,829 188,400 5,710 1,019 - 8,330 14,340 184,041 (5,923) 157,968 (596,820) (188,576) 2021 Opening Balance Repayments Non-cash movements Closing Balance Loan from Barra Resources Ltd Total 2020 Loan from Barra Resources Ltd Total $ 401,380 401,380 $ (407,090) (407,090) $ $ 5,710 5,710 - - Opening Balance Drawdowns Non-cash movements Closing Balance $ - - $ 393,050 393,050 $ $ 8,330 8,330 401,380 401,380 NOTE 23: RELATED PARTY TRANSACTIONS 2021 $ 2020 $ Transactions between related parties are on normal commercial terms and conditions no more favourable than those available to other parties unless otherwise stated. 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 2021 $12,000 (2020: $9,000) 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. Website development, media and marketing fees paid/payable to RM Corporate Finance Pty Ltd, a company in which Mr G Le Page and Mr J Richardson have an interest. Lead manager and placement fees paid/payable to RM Corporate Finance Pty Ltd, a company in which Mr G Le Page and Mr J Richardson have an interest. Underwriting fee paid/payable to RM Corporate Finance Pty Ltd (including $140,000, being the fair value of 20,000,000 underwriter options), a company in which Mr G Le Page and Mr J Richardson have an interest. 144,000 135,000 34,537 8,337 42,000 42,000 27,695 64,616 262,656 - - - 35 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2021 NOTE 23: RELATED PARTY TRANSACTIONS CONTINUED 2021 $ 2020 $ Associated Companies Reimbursement to Tasman Resources Ltd (which has a 10.8% interest in the Company) for employee costs on an hourly basis, in relation to Tasman staff utilised by the Company. 3,703 6,873 NOTE 24: SEGMENT REPORTING The Group has identified its operating segments based on the internal reports that are reviewed and used by the Board of Directors (chief operating decision maker) in assessing performance and determining the allocation of resources. The following have been identified as individual segments: Greenland Conico holds a 100% in both the Ryberg and Mestersvig Projects in Greenland. The Ryberg Project that covers an area of 4,521km² containing the Sortekap gold prospect and the Miki Fjord & Togeda Cu-Ni-Co- PGE-Au magmatic sulphide prospects. The Mestersvig Project containing the historic Blyklippen Pb-Zn mine and Sortebjerg Pb-Zn prospect. Mt Thirsty JV Conico holds a 50% interest in the Mt Thirsty Cobalt Project, located 16km north-northwest of Norseman, Western Australia. 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. Unallocated Unallocated items comprise items that cannot be directly attributed to the Greenland Exploration or the Mt thirsty JV segments and corporate costs which includes those expenditures supporting the business during the period. The segment information for the reportable segments for the year ended 30 June 2021 is as follows Year ended 30 June 2021 Greenland Mt Thirsty JV Unallocated $ $ $ Total $ Segment loss before tax Impairment of assets Capital expenditure additions Segment assets Segment liabilities - - 6,331,608 6,684,356 (324,421) - - 12,516 - 7,920 15,941,683 3,931,682 (270,092) (80,965) (995,140) (995,140) Year ended 30 June 2020 Greenland Mt Thirsty JV Unallocated $ $ $ Segment loss before tax Impairment of assets Capital expenditure additions Segment assets Segment liabilities - - - - - - - 472,701 (349,970) (349,970) - - - 472,701 15,930,182 193,780 16,123,962 (665,342) (231,259) (896,601) NOTE 25: CONTINGENT LIABILITIES AND CONTINGENT ASSETS The Directors are not aware of any contingent assets or contingent liabilities as at 30 June 2021. NOTE 26: EVENTS AFTER THE BALANCE SHEET DATE On 3 September 2021 and 17 September 2021 shares were issued (16,847,833 in total) pursuant to options being exercised, raising $698,413. On 15 September 2021 the Company announced a placement and non-renounceable rights-issue to raise $7 million by the issue of CNJ shares at $0.06 each together with one for two free attaching options to acquire Shares at 10 cents each on or before 30 November 2024. On 22 September 2021, the 67,000,000 placement shares and options were issued, raising $4,020,000. 36 - 6,352,044 26,557,721 (675,478) Total $ NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2021 NOTE 26: EVENTS AFTER THE BALANCE SHEET DATE CONTINUED 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 27: FINANCIAL INSTRUMENTS a. 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. ii. Liquidity Risk 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 programs and to commercialise its tenement assets. If the Company does not raise capital in the short term, it can continue by reducing planned but not committed exploration expenditure until funding is available. All financial liabilities are expected to be settled within 6 months. iii. Foreign currency risk The Group is exposed to fluctuations in foreign currencies arising from the purchase of goods and services in currencies other than the companies’ functional currency. The risk is measured using sensitivity analysis and cash flow forecasting. At 30 June 2021, the effect on the loss as a result of a 10% increase in the value of the Australian dollar, with all other variables remaining constant would be a decrease in loss by approximately $25,000 (2020: Nil). Exploration expenditure relating to the Greenland project is largely in in currencies other than the companies’ functional currency, changes in the foreign exchange rates will affect the cost of exploration on the Greenland project and may affect decisions regarding the quantum of exploration completed in any period. b. Financial Instruments i. Net Fair Values The aggregate net fair values of the financial assets and financial liabilities, at the balance date, are approximated by their carrying value. NOTE 28: COVID-19 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 2021, it is not practicable to estimate the potential impact, positive or negative, after the reporting date. The situation is still 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. NOTE 29: 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 37 DIRECTORS’ DECLARATION In the opinion of the directors of Conico Ltd (the “Company”): a. b. c. the financial statements and notes set out on pages 20 to 37 and the Remuneration disclosures that are contained in pages 16 to 17 of the Remuneration Report in the Directors’ Report, are in accordance with the Corporations Act 2001, including: (i) giving a true and fair view of the Group’s financial position as at 30 June 2021 and of its performance, for the financial year ended on that date; and (ii) complying with Australian Accounting Standards Interpretations) and the Corporations Regulations 2001; and (including the Australian Accounting complying with International Financial Reporting Standards as disclosed in Note 1. (iii) the remuneration disclosures that are contained in pages 16 to 17 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. 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 2021. This declaration is made in accordance with a resolution of the Board of Directors. Gregory H Solomon Chairman Dated this 23rd day of September 2021 38 Independent Auditor’s Report to the Members of Conico Limited Report on the Audit of 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 2021, the consolidated statement of comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies, and the directors’ declaration. In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act 2001, including: (i) giving a true and fair view of the Group’s financial position as at 30 June 2021 and of its 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 Group 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. 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. 39 Key audit matter Future Funding Refer to Note 1 (Basis of Preparation) The Group’s activities have not yet advanced to a stage where it is able to generate revenue, accordingly the Group is reliant on funding from external sources, such as capital raisings, to support its operations. We focused on whether the Group had sufficient cash resources and access to funding to allow the Group to continue as a going concern. The adequacy of funding and liquidity as well as the relevant impact on the going concern assessment is a key audit matter due to the inherent uncertainties associated with the future development of the Group’s projects and the level of funding required to support that development. Capitalisation of exploration and evaluation assets Refer to Note 10 (Exploration and evaluation assets) and As at 30 June 2021 the carrying value of Exploration assets was $22,272,897 (2020: $15,930,182). The Group’s accounting policy in respect of exploration and evaluation assets is outlined in Note 1e. evaluation This is a key audit matter due to the fact that significant judgement is applied in determining and whether evaluation assets the recognition criteria in terms of AASB 6 Exploration for and Evaluation of Mineral Resources. exploration to meet capitalised continue the How our audit addressed the key audit matter We evaluated the Group’s funding and liquidity position at 30 June 2021 and its ability to repay its debts as and when they fall due for a minimum of 12 months from the date of signing the financial report. In doing so, we: ▪ obtained management’s cash flow forecast up to 30 September 2022; ▪ evaluated the reliability and accuracy of the data and assumptions used to prepare management’s forecasts by comparing them to financial information in current and prior years as well as to our understanding of the operating Group’s conditions; future plans and ▪ observed and confirmed that management has the ability to reduce its discretionary costs and exploration costs to conserve the Company’s cash; ▪ we also observed that the Company has its minimum sufficient cash exploration commitments; and to meet ▪ considered events subsequent to year end to determine whether any additional facts or information have become available since the date on which management made its assessment. procedures evaluating focused Our management’s assessment of the exploration and evaluation asset’s carrying value. These procedures included, amongst others: 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 programs for the area of interest. We also assessed the appropriateness of the accounting treatment and disclosure in terms of AASB 6. 40 Other Information The directors are responsible for the other information. The other information comprises the information in the Group’s annual report for the year ended 30 June 2021, 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. Responsibilities of the Directors’ for the Financial Report The directors of the Company are responsible for the preparation of the financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the financial report that gives a true and fair view and is free from material misstatement, whether due to fraud or error. In preparing the financial report, the directors are responsible for assessing the Group’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 Group or to cease operations, or have no realistic alternative but to do so. Auditor’s Responsibilities for the Audit of the Financial Report Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with 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. As part of an audit in accordance with the Australian Auditing Standards, we exercise professional judgement and maintain professional scepticism throughout the audit. We also: ▪ Identify and assess the risks of material misstatement of the financial report, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. ▪ Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control. ▪ Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors. ▪ Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial report or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Group to cease to continue as a going concern. 41 ▪ Evaluate the overall presentation, structure and content of the financial report, including the disclosures, and whether the financial report represents the underlying transactions and events in a manner that achieves fair presentation. ▪ Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the Group financial report. We are responsible for the direction, supervision and performance of the Group audit. We remain solely responsible for our audit opinion. We communicate with the directors regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. We also provide the directors with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate threats or safeguards applied. From the matters communicated with the directors, we determine those matters that were of most significance in the audit of the financial report of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication. Report on the Remuneration Report Opinion on the Remuneration Report We have audited the Remuneration Report included in pages 16 to 17 of the Directors’ Report for the year ended 30 June 2021. In our opinion, the Remuneration Report of Conico Limited for the year ended 30 June 2021 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 23 September 2021 42 ADDITIONAL INFORMATION FOR LISTED PUBLIC COMPANIES 1. Shareholding as at 15 September 2021 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 57 61 164 812 598 1,692 b. The number of shareholders that held in less than marketable parcels at 15 September 2021 was 159. c. The names and relevant interests of the substantial shareholders listed in the holding company’s register as at 15 September 2021 are: Shareholder Tasman Resources Ltd d. Voting Rights Number of Ordinary shares 99,302,539 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 1. 2. Tasman Resources Ltd Bnp Paribas Nominees Pty Ltd Acf Clearstream 3. March Bells Pty Ltd 4. Thomas Harvey Abraham-James 5. Cambrian Limited 6. Arkenstone Pty Ltd 7. 8. Red Eight Pty Ltd Tadea Pty Ltd 9. D M Middleton Pty Ltd 10. Norman & Megan Parker < Parker Superfund A/C> 11. Flourish Super Pty Ltd 12. Kalsie Holdings Pty Ltd 13. Bnp Paribas Nominees Pty Ltd 14. Redcode Pty Ltd 15. Apostman Superannuation Pty Ltd 16. Rosherville Pty Ltd 17. Fiducs Limited 18. Laurentiu David Stefan 19. Mr Guy + Mrs Le Page 20. W I G Pty Ltd Number Shares Held % of Issued Capital 99,302,539 82,661,485 36,764,145 33,328,941 33,328,941 29,165,409 17,000,000 17,000,000 15,000,000 14,240,000 13,382,243 12,000,000 10,752,613 10,000,000 10,000,000 9,700,000 9,528,476 8,823,529 8,793,118 8,000,000 10.65% 8.87% 3.94% 3.58% 3.58% 3.13% 1.82% 1.82% 1.61% 1.53% 1.43% 1.29% 1.15% 1.07% 1.07% 1.04% 1.02% 0.95% 0.94% 0.86% 478,771,439 51.35% 43 2. Unquoted Securities – Options as at 15 September 2021 Holder Name Date of Expiry Exercise Price Various Various Various Various Various 21 September 2023 24 November 2023 15 January 2024 20 January 2024 30 September 2024 $0.02 $0.04 $0.04 $0.07 $0.04 Number on issue Number of holders 1,000,000 8,500,000 2,300,000 61,312,974 10,000,000 83,112,974 2 8 2 89 2 7 TENEMENT SCHEDULE Number Interest % Location E63/1790 P63/2045 E63/1267 R63/4 G(A)63/93 M(A)63/669 M(A)63/670 MEL 2017/06 MEL-S 2019/38 MEL 2020/64 MPL 2019/39 MEL-S 2021/24 50 50 50 50 50 50 50 100 100 100 100 100 WA WA WA WA WA WA WA Greenland Greenland Greenland Greenland Greenland 44 Level 15, 197 St Georges Terrace Perth, Western Australia 6000 Telephone: +81 8 9282 5889 Email: mailroom@conico.com.au Website: www.conico.com.au ABN 49 119 057 457 for the Year Ended 30 June 2021 

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