KORAB RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 17 082 140 252
ANNUAL REPORT
FOR THE YEAR ENDED 30 JUNE 2024
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
TABLE OF CONTENTS
2
Corporate Directory ............................................................................................................................................ 3
Directors’ Report ........................................................................................................................................... 4-15
Auditors Independence Declaration ................................................................................................................. 16
Consolidated Statement of Profit or Loss and Other Comprehensive Income ................................................. 17
Consolidated Statement of Financial Position .................................................................................................. 18
Consolidated Statement of Cash Flows ........................................................................................................... 19
Consolidated Statement of Changes in Equity ................................................................................................. 20
Notes to the Financial Statements .................................................................................................................... 21
Consolidated Entity Disclosure Statement ....................................................................................................... 44
Directors’ Declaration ....................................................................................................................................... 45
Independent Auditor’s Report ........................................................................................................................... 46
Corporate Governance Statement .................................................................................................................... 52
Additional Shareholder Information .................................................................................................................. 56
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KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
CORPORATE DIRECTORY
3
DIRECTORS
Andrej K. Karpinski (Executive Chairman)
Anthony G. Wills (Non-Executive Director)
Alicja Karpinski (Non-Executive Director)
COMPANY SECRETARY
Andrej K. Karpinski
REGISTERED & PRINCIPAL OFFICE
20 Prowse Street
West Perth WA 6005
Telephone: (08) 9474 6166
Facsimile: (08) 9322 6333
E-mail: information@korabresources.com.au
Website: www.korabresources.com.au
AUDITORS
Armada Audit and Assurance Pty Ltd
18 Sangiorgio Court
Osborne Park WA 6017
SHARE REGISTRY
Link Market Services Limited
Level 12, QV1 Building
250 St Georges Terrace
Perth, WA 6000
Telephone: 1300 554 474
International Telephone: +61 2 8280 7761
Facsimile: (02) 9287 0303
Email: registrars@linkmarketservices.com.au
SECURITIES EXCHANGE LISTING
Securities of Korab Resources Limited are listed on ASX Limited
(securities code KOR: shares)
On 29 July 2024 ASX announced the securities of Korab Resources Limited will be suspended from quotation
immediately under Listing Rule 17.3. ASX has determined that Korab’s level of operations is not adequate to
warrant the continued quotation of its securities and therefore is in breach of Listing Rule 12.1. The suspension
will continue until such time that ASX is satisfied with Korab’s compliance with the Listing Rules, including
Listing Rule 12.1, and that it is otherwise appropriate for Korab’s securities to be reinstated to quotation.
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KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
DIRECTORS’ REPORT
4
The directors present their report together with the financial report of the consolidated entity, being Korab
Resources Limited (“Korab” or “Company”) and its subsidiaries (“consolidated entity” or “Group”), at the end
of and for the year ended 30 June 2024. Korab Resources Limited is a listed public company incorporated and
domiciled in Australia.
(LOSS) FOR THE YEAR ATTRIBUTABLE TO OWNERS OF THE PARENT
2024
2023
2022
2021
2020
Loss after taxation ($ million)
(0.932)
(1.360)
(0.612)
(0.531)
(0.261)
Basic and diluted loss per share (cents per share)
(0.25)
(0.37)
(0.17)
(0.16)
(0.08)
Share price at year end (cents per share)
0.81
2.2
1.6
1.2
0.8
1.
The Company’s shares were suspended on ASX on 29 July 2024. ASX has determined that Korab’s level of operations is not
adequate to warrant the continued quotation of its securities and therefore is in breach of Listing Rule 12.1. The suspension will
continue until such time that ASX is satisfied with Korab’s compliance with the Listing Rules, including Listing Rule 12.1, and
that it is otherwise appropriate for Korab’s securities to be reinstated to quotation.
DIRECTORS
The names and details of the Company’s Directors in office at any time during the financial year and up to the
date of this report are as follows. Directors were in office for this entire period unless otherwise stated.
Andrej K. Karpinski, FAICD, F Fin (Executive Chairman)
Appointed April 1998
Responsibilities:
Mr. Karpinski is responsible for business development, all capital raisings, investor
relations, ASX liaison, risk identification and management, strategic direction and
financial management of the Company, performance evaluations and corporate
governance.
Qualifications:
Mr. Karpinski’s background is in mining, investment banking, commodities trading and
funds management. He has held senior positions with Australian and international
companies operating in mining and exploration, oil and gas, corporate finance,
commodities trading and funds management sectors. He brings to the Company his
network of Australian and international contacts within the resources and securities
sectors, his administrative skills and his expertise in project evaluation and sourcing,
financial risk management, treasury management, project financing and resources
banking. Mr. Karpinski is a Fellow of the Australian Institute of Company Directors, a
Fellow of the Financial Services Institute of Australasia and a Professional Member of
the Society of Petroleum Engineers. Mr. Karpinski is the founder of Korab Resources
Limited and has been its Executive Chairman since March 1998 when the Company was
incorporated.
Other Directorships: During the past three years Mr Karpinski has not held any other listed company
directorships. Mr Karpinski is a director of unlisted public company Polymetallica
Minerals Limited.
Shareholding:
Mr. Karpinski's related parties hold 59,734,739 shares in Korab Resources Limited
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ANNUAL REPORT 2024
& CONTROLLED ENTITIES
DIRECTORS’ REPORT (Continued)
5
Anthony G Wills (Non-Executive Director)
Appointed May 2015
Responsibilities:
Mr. Wills brings to the Company experience in strategic planning, operations, security
and risk management, communications, public relations and foreign affairs gained over
his 30-year career.
Qualifications:
Mr. Wills’ background is in defence, finance, and mining. Most recently, Mr Wills has
been involved for over 20 years in the finance industry. Prior to that he served for 20
years in the Australian Defence Force, including 10 years in the Specials Forces serving
with the SAS Regiment. Mr. Wills also brings to the Company his extensive network of
Australian and overseas contacts established through his involvement with the United
Nations and its various missions. Mr Wills is a Member of the Australian Institute of
Company Directors and a Senior Associate of the Financials Services Institute of
Australasia. Mr. Wills continues his longstanding involvement with the SAS Regiment
through his ongoing work for the SAS Resources Fund.
Other Directorships: During the past three years Mr Wills has not held any other listed company directorships.
Mr. Wills is a director of unlisted public company Polymetallica Minerals Limited.
Shareholding:
Mr. Wills and his related entities do not hold any shares in Korab Resources Limited
Alicja Karpinski (Non-Executive Director)
Appointed 6 December 2022
Responsibilities:
Mrs Karpinski has contributed her corporate and social responsibility skills, as well as
her know-how of social, environmental, diversity, and sustainability issues.
Qualifications:
Mrs Karpinski has over 30 years’ experience in the mining industry, corporate finance,
commodities trading, and health industry. Mrs Karpinski completed Master of Law and
Public Administration coursework at the University of Warsaw, Poland
Other Directorships: During the past three years Mrs Karpinski has not held any other listed company
directorships. Her other directorships include Polymetallica Minerals Limited and
Rheingold Investments Corporation Pty Ltd.
Shareholding:
Mrs. Karpinski's related parties hold 59,734,739 shares in Korab Resources Limited.
COMPANY SECRETARY
Mr Andrej Karpinski was appointed Company Secretary in March 1998. Mr Karpinski (FAICD, F Fin) has 26
years’ experience in the position of Company Secretary.
PRINCIPAL ACTIVITIES
The principal activity of the consolidated entity during the year was mineral exploration and the evaluation of
mineral properties. There were no significant changes in the nature of these activities during the financial year.
DIVIDENDS PAID OR RECOMMENDED
No dividends were paid during the year and the directors do not recommend payment of a dividend in respect
of the reporting period (2023: Nil).
OPERATING RESULTS
The Company reported a consolidated loss after taxation for the period of $932,096 (2023: loss of
$1,360,200), primarily relating to corporate compliance and administration costs of $618,977 (2023:
$650,112), finance expense of $437,022 (2023: $354,176), and exploration expenditure impairment of
$242,459 (2023: $652,591), set off by contractors’ expenses capitalised of $239,595 (2023: $267,670).
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KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
DIRECTORS’ REPORT (Continued)
6
FUTURE DEVELOPMENTS
Likely future developments in the operations of the Company are referred to in the Directors’ Report. The
directors are of the opinion that further information as to likely developments in the operations of the
consolidated entity would prejudice the interests of the consolidated entity and accordingly it has not been
included.
REVIEW OF OPERATIONS
RUM JUNGLE PROJECT (RUM JUNGLE MINERAL FIELD, NT)
Winchester Magnesium Deposit
During the reporting period Korab continued work on a scoping study which is evaluating economics of an
alternative Magnesium production method and updates of the previously reported scoping and pre-feasibility
studies.
1.
The pre-feasibility study into the production and sales of DSO magnesium carbonate rock
(magnesite) from Winchester quarry, which was originally reported to the market on 21 March 2018;
2.
The pre-feasibility study into the processing and sales of magnesium oxides (Caustic Calcined
Magnesia and Dead Burned Magnesia), which was originally reported to the market on 12
September 2018; and
3.
The pre-feasibility study into the sales of waste products from Winchester, which was originally
reported to the market on 5 April 2019.
These updated pre-feasibility studies will form the basis for the selection of the general development strategy
for the Winchester Magnesium Project. One of the scenarios being evaluated for the Winchester development
is a 3-stage development of Winchester, where:
Stage 1 Korab Group would initially develop quarrying and sales of magnesium carbonate DSO product;
Stage 2 After the Winchester magnesium carbonate (magnesite) quarry became fully operational and a
sufficient amount of suitable raw material was stockpiled, Korab Group would expand Winchester
into production of various magnesium oxides (Dead Burned Magnesia, and Caustic Calcined
Magnesia) using kilns owned and operated by third parties on a toll-treatment basis;
Stage 3 Finally, after implementation of Stage 1 and Stage 2, and subject to future:
1. Financial position of Korab Group;
2. Funding sources available to the Company;
3. Legislative framework (including any new legislation relating to climate change and/or
emissions reduction goals); and
4. Market conditions;
Korab Group would proceed to construct own kilns and other facilities to enable in-house production of
magnesium oxides and magnesium metal.
During the prior reporting period, on 9 March 2022, Korab reported in a report titled “Winchester Magnesium
Scoping Study” the results of a scoping study which assessed the economics of a tested and proven
magnesium production method relying on electric arc furnace which uses as feed magnesium oxide,
aluminium, and ferrosilicon to produce magnesium metal (the Study). The Study has shown that the
Winchester Project is capable of producing 50,000 tonnes of magnesium metal per year for 14 years at a cost
of between A$5,300 and A$5,400 per tonne. The Company confirms that all the material assumptions
underpinning the production target and other scoping study results initially reported to the public on 9 March
2022 continue to apply and have not materially changed. The Company further confirms that all the material
assumptions underpinning the forecast financial information derived from a production target in the initial public
report released on 9 March 2022 continue to apply and have not materially changed.
Korab continued to progress these updates during and following the end of the reporting period. Results of
these updated studies are expected to be available for release to the market in 2024.
Discussions Regarding Potential Joint Ventures, Offtakes, and Funding
During and following the reporting period Korab continued discussions with potential buyers of magnesium
carbonate rock (DSO), various magnesium oxides and various magnesium metal users and magnesium
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KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
DIRECTORS’ REPORT (Continued)
7
buyers, including aluminium/magnesium alloy producers supplying all major car makers regarding potential
supply of magnesium metal from Winchester. Korab has also undertook discussion with Australian Federal
Government and US Department of Defence regarding potential funding for the development of magnesium
smelter in Australia or in US. No commercial terms have been agreed between the parties. There can be no
certainty that any agreement or agreements can be reached with the other party or that any transaction will
eventuate. Accordingly, no investment decision should be made on the basis of this information. As the
discussions mentioned above are at an early stage and are incomplete any announcement of the details of
these discussions would be premature and speculative.
Following the end of the reporting period, Korab undertook a detailed high-resolution ground gravity survey of
the Winchester project and intends to undertake magnetic, electro-magnetic, and LiDAR surveys at the
Winchester deposit in 2025. Information generated by the surveys will be used to complete the mine and
supporting infrastructure planning which is necessary for submission of the application form environmental
licence (exploration and mining). Preliminary results from the gravity survey were reported to ASX following
the end of the reporting period on 18 September 2024 in a report titled “PRELIMINARY RESULTS OF RUM
JUNGLE GROUND GRAVITY SURVEY”.
About Winchester Magnesium Deposit
The proposed Winchester magnesium mine is located 2 km from the regional centre of Batchelor some 70 km
south of Darwin along Stuart Highway. Winchester Magnesium Deposit is covered by 3-6 meters of overburden
consisting of loose clay and gravel. Massive magnesite mineralisation of high-grade magnesite commences
immediately below the overburden.
For the mineral resource statement and the Competent Person statement in respect of the Winchester
Magnesium Project please refer to page 59 of “KORAB RESOURCES LIMITED AND CONTROLLED
ENTITIES ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2024”, copy of which is available from the
ASX announcement platform and from Korab’s website.
Magnesite rock (after it has been converted to magnesium oxide) is primarily used in the making of refractory
linings necessary for the production of steel, cement, and glass. Other main uses of magnesium oxides and
other magnesium compounds are in production of magnesium metal, which is then used in production of
aluminium/magnesium high-strength light-weight alloys used in car making (especially electric vehicles),
aerospace, and packaging.
Other uses of magnesium and magnesium oxides are in green hydrogen production, rechargeable and single-
use magnesium-ion batteries, nickel and cobalt metallurgy, water purification, cattle feed, and direct nuclear-
to-electric energy conversion technologies.
China plans to increase the use of magnesium metal in cars from 8.5 Kg/car to 45 Kg/car in the near term.
Between 2000 and 2021, China’s control over global magnesium production increased from 12% of the global
supply to 87% of global magnesium supply, creating an effective international monopoly on a 1.2 million tonnes
per annum market.
The situation is even more dramatic in Europe where China supplies over 95% of magnesium metal. Recent
cuts to production of magnesium and its exports by Chinese government resulted in the Chinese magnesium
metal price increasing from approximately $2,000 per tonne in October 2020 to approximately $3,200 per
tonne in early September 2021, and $15,000 per tonne in October 2021.
US prices of magnesium are significantly higher than Chinese or European magnesium prices because US
imposes approximately 140% anti-dumping import duty on Chinese magnesium (Error! Reference source n
ot found.). Consequently, exporting magnesium metal to US is a very attractive proposition for Korab
Resources due to potentially much higher profit margin resulting from high local US prices and an exemption
of Australian magnesium from import duties pursuant to the Australia–United States Free Trade Agreement.
Global magnesium supply risks are compounded by the fact that less than 9% of global primary magnesium
comes from countries with low political risk. As illustrated by Error! Reference source not found., over 90% o
f annual global magnesium production comes out of China, Russia, Kazakhstan, Ukraine, and Iran.
Winchester deposit waited for development for 2 decades primarily because of low magnesium prices between
$1,300/t and $2,000/t) and low magnesium oxide prices (CCM and DBM) during this period. These depressed
prices were caused by rapid growth in Chinese production capacity of both magnesium metal and magnesium
oxides, with supply growth outstripping the growth in demand. This has made the development of Winchester
not feasible until few years ago when prices of magnesite and magnesium oxides have markedly improved.
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KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
DIRECTORS’ REPORT (Continued)
8
General Rum Jungle Project Exploration
Korab continued exploration and evaluation of Rum Jungle Project with particular focus on gold, silver, cobalt,
nickel, lead, scandium, rare earth oxides (REO), lithium, and base metals. During the reporting period on 29
January 2024 Korab reported to ASX results for the lithium and REE review using the available data in a report
titled “RESULTS OF NT LITHIUM & REO REVIEW”.
Rum Jungle Project comprises 2 granted exploration licences (EL29550 and EL31341) and 8 granted mining
leases (ML27362, ML30587, MLN512, MLN513, MLN514, MLN515, MLN542 and MLN543) covering an area
of approximately 240 square kilometres of the highly prospective Pine Creek Orogen (PCO). Majority of the
Rum Jungle Project is underlain by the Burrell Creek Formation.
Following the end of the reporting period on 23 July 2024, Korab reported that it has commenced a detailed
high-resolution ground gravity survey at Rum Jungle Project. The preliminary results from the first phase of
the gravity survey were reported on 18 September 2024 in a report titled “PRELIMINARY RESULTS OF RUM
JUNGLE GROUND GRAVITY SURVEY”. The survey will continue in 2025 and will be followed by a magnetic,
electro-magnetic, and LiDAR surveys of most of the Rum Jungle Project.
Sundance Gold Prospect
During the reporting period, the Company has continued the work on re-opening of the Sundance gold mine
located within the Rum Jungle Project and on treating the rock (which has been stockpiled on the mining
leases) at the processing plant owned by a third party. Discussions with third parties are ongoing but are
incomplete and details are confidential. There can be no certainty that any agreement or agreements can be
reached or that any agreement will eventuate from these discussions. Accordingly, no investment decision
should be made on the basis of this information. The Sundance Prospect is located on granted mining leases
MLN542 and MLN543 (100% owned by Korab). Following the end of the reporting period on 23 July 2024,
Korab reported that it has commenced a detailed high-resolution ground gravity survey at Sundance Prospect
within the Rum Jungle Project. The preliminary results from the first phase of the gravity survey were reported
on 18 September 2024 in a report titled “PRELIMINARY RESULTS OF RUM JUNGLE GROUND GRAVITY
SURVEY”.
Geolsec Rock Phosphate
During the reporting period Korab focused on other mineral assets and consequently exploration work at the
Geolsec project was limited. Following the end of the reporting period, on 19 August 2024 the Company
advised that Korab and Geolsec Phosphate Operations Pty Ltd (GPO) have executed binding Heads of
Agreement (HoA) with an unrelated party, Leka II Shipping Limited (Leka) to sell to Leka all Korab Group’s
rights, title and interests in and to the Geolsec mineral lease ML27362 and all mining exploration information
relating to the mineral lease (the Assets) for a cash consideration of $4.35 million and a royalty of 10% of Net
Smelter Returns on all minerals other than uranium and thorium and a royalty of 1% of Net Smelter Returns
on uranium and thorium. For further details of this transaction please refer to the SUBSEQUENT EVENTS
section of this report.
BOBRIKOVO GOLD AND SILVER PROJECT (LUHANSK REGION, UKRAINE)
On 24 September 2019, Korab reported that that it has received notification from its Ukrainian subsidiary “DKL”
that on the basis of the Executive Order/Decree of the President of Ukraine, all exploration licences, mining
permits, and leases held by “DKL” whose term would have otherwise expired, have been prolonged until the
end of the hostilities in the Luhansk Region.
For the mineral resource statement and the Competent Person statement in respect of the Bobrikovo Project
please refer to pages 59 and 60 of “KORAB RESOURCES LIMITED AND CONTROLLED ENTITIES ANNUAL
REPORT FOR THE YEAR ENDED 30 JUNE 2024”, copy of which is available from the ASX announcement
platform and from Korab’s website. Current situation in Ukraine is well known to the market from extensive
media coverage. Accumulated capitalised exploration expenditure and acquisition costs of Bobrikovo Project
have been written down to NIL at consolidation level in 2014.
MT. ELEPHANT/ASHBURTON DOWNS PROJECT (ASHBURTON MINERAL FIELD, WA)
During the reporting period Korab relinquished all remaining granted tenements comprising the Mt. Elephant
Project (E08/2756, E08/2757, E08/2307, and E52/2724). As a result, $242,460 impairment loss was recorded
as at 30 June 2024 (2024: $652,591). The project now consists of 2 exploration licence applications
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KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
DIRECTORS’ REPORT (Continued)
9
(ELA08/3561, and ELA52/4223). Korab also has a right to acquire exploration licence resulting from an
eventual grant of an application for exploration licence ELA08/3560 made by Rheingold Investments
Corporation Pty Ltd (a company controlled by Korab’s Executive Chairman Mr. Karpinski) in exchange for
reimbursement of the application fee and prepaid 1st year’s tenement rent. For further details of this application
please refer to the SUBSEQUENT EVENTS section of this report.
PROCEEDINGS ON BEHALF OF COMPANY
No person has applied for leave to the Court to bring proceedings on behalf of the Company or intervene in
any proceedings to which the Company is a party for the purpose of taking responsibility on behalf of the
Company for all or any part of those proceedings. The Company was not a party to any such proceedings
during the year.
ENVIRONMENTAL ISSUES
The Group has a policy of complying with or exceeding its environmental performance obligations. The Board
believes that the Company has adequate systems in place for the management of its environmental
requirements. The Group aims to ensure the appropriate standard of environmental care is achieved, and in
doing so, that it is aware of and is in compliance with all environmental legislation. The directors of the Group
are not aware of any breach of environmental legislation for the financial year under review.
DIRECTORS’ INTERESTS
At the date of this report, the relevant interests of the directors in securities of the Company are as follows:
Name
Ordinary shares
Options over ordinary shares
Andrej K. Karpinski
59,734,7391
-
Alicja Karpinski
59,734,7391
-
Anthony G Wills
-
-
1 These shares are held in the same entities
SUBSEQUENT EVENTS
Forfeiture application
On 1 July 2024 the Company announced that Andrew James Hawker, a director, sole shareholder, and
principal geologist of Hawker Geological Services Pty Ltd (HGS Australia) has lodged a forfeiture application
against the tenement E08/2757 previously held by Korab's subsidiary Australian Copper Pty Ltd. Andrew
Hawker formerly acted (through HGS Australia) as a geological consultant to Korab and its subsidiaries,
including Australian Copper Pty Ltd. Tenement E08/2757 covered 5 blocks within Ashburton Mineral Field and
was the last remaining granted tenement of the Mt Elephant Project. Australian Copper Pty Ltd has
surrendered tenement E08/2757. Consequently, the Mt Elephant Project now consists of two applications for
exploration licences ELA08/3561 and ELA52/4223. Korab also has a right to acquire exploration licence
resulting from an eventual grant of an application for exploration licence ELA08/3560 made by Rheingold
Investments Corporation Pty Ltd (a company controlled by Korab’s Executive Chairman Mr. Karpinski). On 27
February 2024, the Company reported that its subsidiaries Australian Coper Pty Ltd and Australian Copper
Holdings Pty Ltd are objecting in the Wardens court to a purported application by Ashcroft Resources Pty Ltd
for exploration licence E08/3315 (the Proceedings). In the same report, the Company advised that it proposes
to acquire from a related party, Rheingold Investments Corporation Pty Ltd (Rheingold), a company controlled
by the Company’s Executive Chairman Mr Karpinski, exploration licence E08/3560 should the above objection
be successful and the exploration licence E08/3560 be granted. Application for E08/3560 and purported
application E08/3315 cover broadly same ground. The proposed acquisition is subject to shareholder approval
should it be required by ASX. If the Company acquires exploration licence E08/3560, it will reimburse
Rheingold for its reasonable out of pocket expenses incurred in the process of applying for the E08/3560 and
progressing it to grant. On 6 March 2024, the Company reported that the Warden adjourned the Proceedings
for mention hearing on 6 May 2024, with no orders to cost. Following the end of the reporting period the matter
has been further adjourned by the Warden to 20 December 2024.
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KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
DIRECTORS’ REPORT (Continued)
10
Suspension from quotation on ASX
On 29 July 2024 ASX announced the securities of Korab Resources Limited will be suspended from quotation
immediately under Listing Rule 17.3. ASX has determined that Korab’s level of operations is not adequate to
warrant the continued quotation of its securities and therefore is in breach of Listing Rule 12.1. The suspension
will continue until such time that ASX is satisfied with Korab’s compliance with the Listing Rules, including
Listing Rule 12.1, and that it is otherwise appropriate for Korab’s securities to be reinstated to quotation.
Geolsec mineral lease ML27362
On 19 August 2024 the Company advised that Korab and Geolsec Phosphate Operations Pty Ltd (GPO) have
executed binding Heads of Agreement (HoA) with an unrelated party, Leka II Shipping Limited (Leka) to sell
to Leka all Korab Group’s rights, title and interests in and to the Geolsec mineral lease ML27362 and all mining
exploration information relating to the mineral lease (the Assets) for a cash consideration of $4.35 million and
a royalty of 10% of Net Smelter Returns on all minerals other than uranium and thorium and a royalty of 1%
of Net Smelter Returns on uranium and thorium (the Transaction). Mineral lease ML27362 is 100% owned by
Geolsec Phosphate Operations Pty Ltd (wholly owned subsidiary of Korab Resources Ltd) and is located some
60 km south of Port of Darwin in the Northern Territory of Australia. Under the HoA, Leka II Shipping Limited
will pay to Korab Group a deposit of 10% of cash consideration with the balance of cash consideration payable
on completion. Completion is envisaged to take place in 120 days from the date of signing of the HoA (16
August 2024). The completion date may be changed by agreement between the parties.
Under the HoA, if ASX required Korab to obtain shareholder approval for this transaction, such approval had
to be obtained within 45 days, or as amended by agreement between the parties. Following the end of the
reporting period, on 19 September 2024 Korab advised that following its submission to ASX seeking a
determination whether a shareholder approval is required for the Transaction pursuant to the ASX Listing
Rules, the Company has received from ASX confirmation that ASX does not consider that either Listing Rule
11.1 or 11.2 applies to the proposed sale of Mineral Lease ML27362. Therefore, the Transaction does not
require shareholder approval and consequently the Company does not intend to call an Extraordinary General
Meeting of shareholders for the purpose of approving the Transaction. The Company has advised Leka
accordingly.
The HoA is binding on Korab Group and Leka. The HoA contains customary conditions, warranties, and
assurances usual to these types of agreements. The key conditions of the transaction are that prior to and
upon completion, GPO will ensure that there has been no material adverse change to the Assets and that the
mineral lease ML27362 is in good standing. Furthermore, any party may lodge such caveats or other security
pursuant to the Mining Act as it thinks fit to protect its interests in the transaction. The HoA requires compliance
by the parties in all respects with the Corporations Act 2001 (Cth) and the ASX Listing Rules as they apply to
the transaction and requires respective parties to obtain all government, statutory or regulatory approvals,
consents and/or permits required to enable parties to perform their obligations under the HoA, including
Ministerial approval to the transfer of the mineral lease if such is required. The parties agree to use their best
endeavours to ensure that the conditions are satisfied as quickly as possible and, in any event, on or before
the deadlines set out above. Korab intends to use the proceeds from this transaction to retire debt, for working
capital purposes, and for exploration and development work on its projects, with the focus on Rum Jungle
Project. There are no changes to the board or senior management proposed as a consequence of the
transaction.
No other matter or circumstance has arisen since 30 June 2024 that in the opinion of the directors has
significantly affected, or may significantly affect in future financial years the consolidated entity’s operations,
the results of those operations, or the consolidated entity’s state of affairs.
IDENTIFICATION OF INDEPENDENT DIRECTORS
The independent directors are identified in the Corporate Governance Statement section of this report as set
out on pages 52 to 55.
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KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
DIRECTORS’ REPORT (Continued)
11
MEETINGS OF DIRECTORS
The number of directors' meetings held during the financial year for each director who held office during the
financial year and the number of meetings attended by each director is as follows:
Director
Meetings
attended
Number eligible
to attend
Andrej Karpinski
12
12
Alicja Karpinski
11
12
Anthony Wills
12
12
SHARE OPTIONS
Shares under option
There were no share options on issue at the start or end of the year, nor were any share options issued during
the year. No options have been granted since the end of the reporting period. There have been no options
exercised since the end of the reporting period. During the reporting period there was no forfeiture or vesting
of options granted in previous periods.
CORPORATE GOVERNANCE
In recognising the need for the highest standards of corporate behaviour and accountability, the directors of
Korab support and adhere to the principles of sound corporate governance. The Board considers that Korab
is in compliance with the ASX corporate governance principles and recommendations which are of critical
importance to the commercial operation of a junior listed resources company. The Company’s Corporate
Governance Statement is set out on pages 52 to 55 of this report.
SIGNIFICANT CHANGES IN STATE OF AFFAIRS
Other than stated elsewhere in this report there have been no significant changes in the state of affairs of the
consolidated entity during the period under review.
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
DIRECTORS’ REPORT (Continued)
12
REMUNERATION REPORT (Audited)
The information provided in this remuneration report has been audited as required by section 308 (3C) of the
Corporations Act 2001.
Principles used to determine the nature and amount of compensation
The Board determines remuneration policies and practices, evaluates the performance of senior management,
and considers remuneration for those senior managers.
The Board assesses the appropriateness of the nature and amount of remuneration on an annual basis by
reference to industry and market conditions, and with regard to the Company’s financial and operating
performance.
Total non-executive directors’ fees are approved by shareholders and the Board is responsible for the
allocation of those fees amongst the individual members of the Board. The value of remuneration is determined
on the basis of cost to the Company and consolidated entity. Remuneration of key management personnel is
referred to as compensation, as defined in Accounting Standard AASB 124 Related Parties.
Compensation levels for key management personnel of the Company and consolidated entity are competitively
set to attract and retain appropriately qualified and experienced directors and senior executives. The Board
obtains, when required, independent advice on the appropriateness of remuneration packages, given trends
in comparative companies both locally and internationally. Compensation arrangements can include a mix of
fixed and performance-based compensation however the Company has not paid bonuses to directors or
executives to date. Share-based compensation can be awarded at the discretion of the Board, subject to
shareholder approval when required.
It is the intention of the Board to tailor the remuneration policy to maximise the commonality of goals between
shareholders and key management personnel. The method which is most likely to achieve this aim is the issue
of options to key management personnel to encourage the alignment of personal and shareholder interests.
The directors believe this policy will be the most effective in increasing shareholder wealth.
Compensation structures take into account the overall level of compensation for each director and executive,
the capability and experience of the directors and senior executives, the executive’s ability to control the
financial performance of the relative business or geographical segment, the consolidated entity’s performance
(including earnings and the growth in share price), and the amount of any incentives within each executive’s
remuneration. Given the consolidated entity’s focus on exploration projects during the year, the Board did not
have regard to the consolidated entity’s financial performance and / or change in shareholder wealth occurring
in the current financial year and previous three financial years in setting remuneration.
Fixed compensation
Fixed compensation consists of base compensation as well as any employer contributions to superannuation
funds.
Service contracts
The contract duration, notice period and termination conditions for key management personnel are:
Andrej K Karpinski, Executive Chairman. In July 2008 the Company entered into an Executive Service
Agreement with Rheingold Investments Corporation Pty Ltd. Under the terms of the agreement Mr Karpinski,
being the director of Rheingold Investments Corporation Pty Ltd, has agreed to provide management services
to the Company at a rate of $327,000 per annum plus GST. In addition to corporate management services,
Rheingold Investments Corporation Pty Ltd provides to the Company tenement management, mineral
exploration, company secretarial, and accounting/bookkeeping services. The Agreement may be terminated
by the Company at any time by giving Rheingold Investments Corporation Pty Ltd twelve (12) months' notice.
In the event the Company does not require the services provided under the Executive Service Agreement with
Rheingold Investments Corporation Pty Ltd, the Company shall pay to Rheingold Investments Corporation Pty
Ltd an amount of $327,000 plus GST and any unused annual break from service leave.
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
DIRECTORS’ REPORT (Continued)
13
Key Management Personnel Remuneration
Details of the nature and amount of each major element of the remuneration of group key management
personnel are set out below. There was no share based or performance-based remuneration in either the
current or prior period.
Andrej
Karpinski
Alicja
Karpinski
Anthony
Wills
Total
2024
$
$
$
$
Short-term benefits
2024 year fees
327,000
-
26,000
353,000
Post-employment benefits
Superannuation contributions
-
-
2,730
2,730
Performance related %
-
-
-
-
Total
327,000
-
28,730
355,730
Andrej
Karpinski
Rodney
Skeet
Alicja
Karpinski
Anthony
Wills
Total
2023
$
$
$
$
$
Short-term benefits
2023 year fees
327,000
11,190
-
26,325
364,515
Post-employment benefits
Superannuation contributions
-
-
-
2,946
2,946
Performance related %
-
-
-
-
-
Total
327,000
11,190
-
29,271
367,461
Non-executive directors
Total remuneration for all non-executive directors is not to exceed $120,000 per annum. A non-executive
director’s base fee is currently $26,000 per annum. Mrs. Alicja Karpinski decided to renounce her entitlement
to be paid directors’ fees, and will perform her non-executive directors’ duties without receiving any
remuneration. The Executive Chairman currently does not and has never in the past received director’s fees.
Rheingold Investments Corporation Pty Ltd, a company controlled by the Executive Chairman receives
management fees which are disclosed elsewhere in this report.
Non-executive directors do not receive any performance related remuneration; however, they may be paid for
work performed over and above their non-executive duties. Directors’ fees cover all main Board activities and
membership of Board committees. The Company does not have any terms or schemes relating to retirement
benefits for non-executive directors. Non-executive directors receive share-based compensation at the
discretion of the Board, and subject to approval by shareholders. No remuneration consultants were used
during the year.
Loans to and other related transactions with key management personnel
Mr Andrej Karpinski is a director and controlling shareholder of Rheingold Investments Corporation Pty Ltd
(“Rheingold”). Management contract fees form part of the remuneration of directors and have been disclosed
as such in the directors' report.
2024
2023
$
$
Fees to Rheingold Investments Corporation Pty Ltd for:
- Management contract fees
327,000
327,000
Total fees to Rheingold Investments Corporation Pty Ltd
327,000
327,000
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
DIRECTORS’ REPORT (Continued)
14
Amounts payable to key management personnel and their related entities at reporting date in respect of
outstanding fees, expenses and loans are:
2024 ($)
2023 ($)
Current
Trade and other payables
23,291
20,561
Loans and borrowings
35,150
35,000
Non-current
Loans and borrowings
1,836,520
1,432,780
During the prior period the directors and Rheingold agreed to suspend payments of the executive services
fees (management contract fees) and directors’ fees. The unpaid fees are being accrued. The balance of
outstanding liabilities to Rheingold, Mr. Karpinski, Mrs Karpinski and their related entities at period end for
loans to the parent entity and unpaid fees is $1,552,194 (2023: $1,204,092) at an average interest rate of 12%.
The loans and unpaid fees are not payable prior to 31 October 2025. These loans and debt become payable
immediately on change of control of Korab. To reduce Korab’s operating costs Mr. Karpinski and Mrs. Karpinski
have waived their rights to receive directors’ fees from Korab. Mr. Karpinski and Mrs. Karpinski do not receive
directors’ fees, and have not received any directors' fees from Korab or its subsidiaries since the formation of
Korab in March 1998 to the date of this report. During the reporting period accrued Rheingold management
fees were converted to loans and some of the prior year loans and converted fees were repaid. Interest
accrued to Rheingold, Mr. Karpinski, Mrs. Karpinski and their related entities during the reporting period was
$151,264 (2023: $121,847).
The balance of outstanding liabilities to directors, excluding Mr. Karpinski, Mrs. Karpinski and their related
entities at period end for loans to the parent entity and unpaid fees is $319,475 (2023: $263,688) at an average
interest rate of 12%. The balance of outstanding liabilities to Mr. Wills at period end for loans to the parent
entity and unpaid fees is $319,475 (2023: $263,688). Interest accrued to Mr. Wills was $33,687 (2023:
$27,462) for the year ended 30 June 2024.
Mr Andrej Karpinski is a director and significant shareholder of Polymetallica Minerals Limited (formerly
Uranium Australia Pty Ltd). The balance of outstanding receivables from Polymetallica Minerals Limited at
year end is $1,305,526 (2023: $1,279,487) at an interest rate of 8.5%. The receivable is not payable prior to
31 October 2025. The balance of outstanding receivables from Polymetallica Minerals Limited consist of funds
provided by Company to pay for tenement rents and other project related costs in relation to projects where
the Company and Polymetallica have, or had joint venture arrangements, and/or production sharing
agreements, plus any accrued interest. These joint venture arrangements and/or production sharing
agreements were established when Polymetallica was a subsidiary of the Company prior to Polymetallica
being demerged (spun-off) from the Company. The Company has a registered security over all current and
future assets of Polymetallica until the debt is repaid in full. During the year Polymetallica paid the Company
$Nil (2023: $Nil) in principal and $82,010 (2023: $12,000) in interest with the remaining interest of $26,039
(2023: $90,879) accruing. The total interest charged on the loan for the year ended 30 June 2024 was
$108,049 (2023: $102,879).
The amount within trade and other payables owed to KMPs is $23,291 (2023: $20,561), refer to Note 9.
Refer to Note 16 and Note 17 for further disclosures of related party transactions.
Share options
There were no share options on issue to Key Management Personnel at the start or end of the year, nor
were any share options issued to them during the year.
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
DIRECTORS’ REPORT (Continued)
15
Shares
The movement during the reporting period in the number of ordinary shares in Korab Resources Limited held,
directly, indirectly or beneficially, by each key management person, including their related parties, is as follows:
Director
Held at 1/7/23
Net acquired
Held at 30/6/24
Andrej Karpinski
59,734,739
-
59,734,7391
Alicja Karpinski
59,734,739
-
59,734,7391
Anthony Wills
-
-
-
1 These shares are held in the same entity
DIVIDENDS
No dividends were paid or declared during the period (2023: Nil).
INDEMNIFICATION AND INSURANCE OF DIRECTORS AND OFFICERS
The Company has indemnified the Directors and executives of the Company and its subsidiaries for the costs
incurred, in their capacity as a Director or executive, for which they may be held personally liable.
During the financial year the Company did not pay a premium to insure the directors and officers of the
Company and its controlled entities.
AUDITORS INDEPENDENCE DECLARATION
The auditor’s independence declaration under Section 307C of the Corporations Act 2001 is set out on page
16.
NON-AUDIT SERVICES
There were no non-audit services provided by the auditors during the current or preceding financial years.
This report is signed in accordance with a resolution of the directors.
Andrej K Karpinski, FAICD, F Fin
Executive Chairman
Perth, Western Australia,
28 October 2024
For personal use only
AUDITOR’S INDEPENDENCE DECLARATION
UNDER SECTION 307C OF THE CORPORATIONS ACT 2001
TO THE DIRECTORS OF
KORAB RESOURCES LIMITED
I declare that, to the best of my knowledge and belief, during the audit for the year ended 30 June
2024 there have been:
i)
No contraventions of the auditor 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.
ARMADA AUDIT & ASSURANCE PTY LTD
Nigel Dias
Director
Perth, 28 October 2024
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE
INCOME
FOR THE YEAR ENDED 30 JUNE 2024
17
30 June 2024
30 June 2023
Notes
$
$
Other Income
2(a)
59,500
-
Finance income
108,714
105,644
Foreign exchange loss
(331)
(1,280)
Finance expense
2(b)
(437,022)
(354,176)
Corporate, compliance and management
2(c)
(618,977)
(650,112)
Field survey costs
-
(20,660)
Conference, travel and public relations
(500)
(7,417)
Exploration expenditure impairment
8
(242,459)
(652,591)
Occupancy costs
(40,616)
(47,278)
Contractors’ expenses capitalised
8
239,595
267,670
Loss before income tax
(932,096)
(1,360,200)
Income tax expense
4
-
-
Loss for the year
(932,096)
(1,360,200)
Other comprehensive income for the year net of income
tax
Items that may be classified to profit or loss
Exchange difference on translation of foreign operations
-
-
Total comprehensive loss for the year
(932,096)
(1,360,200)
Basic and diluted loss per share (cents per share)
6
(0.25)
(0.37)
The above consolidated statement of profit or loss and other comprehensive income should be read in
conjunction with the accompanying notes to the financial statements.
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2024
18
30 June 2024
30 June 2023
Notes
$
$
Current assets
Cash and cash equivalents
13
93,351
112,382
Trade receivables and other financial assets
7
15,905
4,455
Prepayments
108,802
88,802
Total current assets
218,058
205,639
Non-current assets
Trade receivables and other financial assets
7
1,305,971
1,291,382
Exploration and evaluation
8
3,161,547
3,094,682
Total non-current assets
4,467,518
4,386,064
Total assets
4,685,576
4,591,703
Current liabilities
Trade and other payables
9
242,107
191,141
Loans and borrowings
10
35,150
35,000
Total current liabilities
277,257
226,141
Non-current liabilities
Loans and borrowings
10
4,252,623
3,277,770
Total non-current liabilities
4,252,623
3,277,770
Total liabilities
4,529,880
3,503,911
Net assets
155,696
1,087,792
Equity
Contributed equity
14(a)
21,186,134
21,186,134
Foreign currency translation reserve
14(c)
(997,078)
(997,078)
Non-controlling interest contribution reserve
14(d)
(1,036,227)
(1,036,227)
Accumulated losses
14(b)
(18,997,133)
(18,065,037)
Total equity
155,696
1,087,792
The above consolidated statement of financial position should be read in conjunction with the accompanying
notes to the financial statements.
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2024
19
30 June 2024
30 June 2023
Notes
$
$
Cash flows from operating activities
Revenue
59,500
-
Payments to suppliers and employees
(228,284)
(95,602)
Interest received
82,675
2,765
Net cash flows used in operating activities
13(a)
(86,109)
(92,837)
Cash flows from investing activities
Exploration and evaluation expenditure net reimbursements
(69,729)
(354,964)
Net cash flows used in investing activities
(69,729)
(354,964)
Cash flows from financing activities
Proceeds from borrowings
449,100
3,344,410
Repayments of borrowings
(312,293)
(3,612,010)
Repayment of advances to other entities
-
12,000
Net cash flows provided by / (used in) financing
activities
136,807
(255,600)
Net (decrease) in cash and cash equivalents
(19,031)
(703,401)
Cash and cash equivalents at the beginning of the financial
year
112,382
815,783
Cash and cash equivalents at the end of the financial
year
13(b)
93,351
112,382
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes
to the financial statements.
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2024
20
Contributed
equity
Accumulated
losses
Non-
controlling
interest
contribution
reserve
Foreign
currency
translation
reserve
Total
$
$
$
$
$
Balance at 30 June 2022
21,186,134
(16,704,837)
(1,036,227)
(997,078)
2,447,992
Loss for the year
-
(1,360,200)
-
-
(1,360,200)
Total comprehensive loss for the year
-
(1,360,200)
-
-
(1,360,200)
Transactions with owners in their capacity
as owners:
Balance at 30 June 2023
21,186,134
(18,065,037)
(1,036,227)
(997,078)
1,087,792
Loss for the year
-
(932,096)
-
-
(932,096)
Total comprehensive loss for the year
-
(932,096)
-
-
(932,096)
Transactions with owners in their capacity
as owners:
Balance at 30 June 2024
21,186,134
(18,997,133)
(1,036,227)
(997,078)
155,696
The above consolidated statement of changes in equity should be read in conjunction with the accompanying
notes to the financial statements.
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
21
1.
SUMMARY OF MATERIAL ACCOUNTING POLICIES
The principal accounting policies adopted in the preparation of these consolidated financial statements are set
out below. These policies have been consistently applied to all the years presented, unless otherwise stated.
The financial statements are for the consolidated entity consisting of Korab Resources Limited and its
subsidiaries (“consolidated entity” or “Group”).
(a) Basis of preparation
These general purpose financial statements have been prepared in accordance with Australian Accounting
Standards (“AASBs”) (including Australian Accounting Interpretations), as adopted by the Australian
Accounting Standards Board (“AASB”), other authoritative pronouncements of the AASB and the Corporations
Act 2001. Australian Accounting Standards include Australian equivalents to International Financial Reporting
Standards (AIFRS). Compliance with AIFRS ensures that the financial report of Korab Resources Limited
complies with International Financial Reporting Standards as issued by the International Accounting Standards
Board. Comparative information is reclassified where appropriate to enhance comparability.
The functional and presentation currency of the Company is Australian dollars. The financial report was
authorised for issue by the directors on 28 October 2024. Korab Resources Limited is a company limited by
shares, incorporated and domiciled in Australia.
Basis of measurement
The financial report is prepared on a historical cost basis as modified by the revaluation of financial assets and
liabilities at fair value through profit or loss.
Going concern
The financial report has been prepared on the basis of accounting principles applicable to a going concern,
which assumes the commercial realisation of the future potential of the Group’s assets and the discharge of
its liabilities in the normal course of business. At balance date, the Group had negative net current assets of
$59,199 (2023: negative net current assets of $20,502) and had a net cash outflow from operations for the
year of $86,109 (2023: outflow of $92,837). The financial statements do not include any adjustments relating
to the recoverability and classification of recorded asset amounts, or to the amounts and classification of
liabilities that might be necessary should the Group not continue as a going concern.
On 19 August 2024 the Company advised that Korab and Geolsec Phosphate Operations Pty Ltd (GPO) have
executed binding Heads of Agreement (HoA) with an unrelated party, Leka II Shipping Limited (Leka) to sell
to Leka all Korab Group’s rights, title and interests in and to the Geolsec mineral lease ML27362 and all mining
exploration information relating to the mineral lease (the Assets) for a cash consideration of $4.35 million and
a royalty of 10% of Net Smelter Returns on all minerals other than uranium and thorium and a royalty of 1%
of Net Smelter Returns on uranium and thorium. The HoA requires compliance by the parties in all respects
with the Corporations Act 2001 (Cth) and the ASX Listing Rules as they apply to the transaction and requires
respective parties to obtain all government, statutory or regulatory approvals, consents and/or permits required
to enable parties to perform their obligations under the HoA, including Ministerial approval to the transfer of
the mineral lease if such is required. The parties agree to use their best endeavors to ensure that the conditions
are satisfied as quickly as possible and, in any event, on or before the deadlines set out in the HOA. Under
the HoA, Leka II Shipping Limited will pay to Korab Group a deposit of 10% of cash consideration with the
balance of cash consideration payable on completion. Completion is envisaged to take place in 120 days from
the date of the HOA being signed being 16 August 2024. The completion date may be changed by agreement
between the parties
The Company has received written confirmations from its lenders that the loans of $4,252,623 will not be called
for repayment until at least 31 October 2025. Furthermore, the Company will need to seek additional funding
either via increase in debt or raising of additional share capital, and to reduce its discretionary costs in the
coming year in order to meet its operating expenditure and planned exploration expenditure for the next twelve
months from the date of signing these financial statements. The directors have the ability to curtail all of its
discretionary exploration and corporate costs and have implemented strict control over expenditure. The
Company also available $34,000 in unused financing facilities. The directors are confident of being able to
obtain additional funding through increase in debt, raising of additional share capital, reducing discretionary
costs, or sale of assets such as the Geolsec sale referred to above. Should this not occur, or not occur on a
sufficiently timely basis, there is a material uncertainty that may cast significant doubt about the Group’s ability
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
22
to continue as a going concern and therefore, the Group may be unable to realise its assets and discharge its
liabilities in the normal course of business.
Use of estimates and judgements
The preparation of the financial report requires management to make judgements, estimates and assumptions
that affect the application of accounting policies and the reported amounts of assets and liabilities, income and
expenses. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed
on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is
revised and in any future periods affected.
The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying
amounts of assets and liabilities within the next financial year and judgments, apart from those involving
estimations, which have the most significant effect on the amounts recognised in the financial statements, are
as follows:
(i) Exploration and evaluation assets
Exploration and evaluation expenditure is accumulated in respect of each identifiable area of interest. These
costs are carried forward in respect of an area that has not at balance date reached a stage which permits a
reasonable assessment of the existence or otherwise of economically recoverable reserves, and active and
significant operations in or relating to, the area of interest are continuing.
(ii) Recoverability of loan to Polymetallica Minerals Limited
Korab has been advised by Polymetallica that it is in the process of arranging of a debt and equity funding
from third parties to raise funds to repay the loans made by Korab. Korab holds registered security interest
over all current and future assets of Polymetallica. Korab has also received an independent valuation of
Polymetallica's mineral assets valuing them in excess of the balance of the loan to Polymetallica.
(b) Principles of consolidation
Subsidiaries
The consolidated financial report comprises the financial statements of the Company and its controlled entities.
A controlled entity is any entity controlled by the Company whereby the parent entity has the power to control
the financial and operating policies of an entity so as to obtain benefits from its activities. All inter-company
balances and transactions between entities in the consolidated entity, including any unrealised profits or
losses, have been eliminated on consolidation. Where a subsidiary enters or leaves the consolidated entity
during the year, its operating results are included or excluded from the date control was obtained or until the
date control ceased. Accounting policies of subsidiaries have been changed where necessary to ensure
consistency with those applied by the parent entity.
(c) Recoverable amount of assets and impairment testing
Assets that have an indefinite useful life are not subject to depreciation and are tested annually for impairment
by estimating their recoverable amount.
Assets that are subject to depreciation are reviewed for impairment whenever events or changes in
circumstances indicate that the carrying amount may not be recoverable. Where such an indicator exists, a
formal assessment of recoverable amount is then made. Where this is less than carrying amount, the asset is
written down to its recoverable amount.
Recoverable amount is the greater of fair value less costs to sell and value in use. Value in use is the present
value of the future cash flows expected to be derived from the asset or cash generating unit. In estimating
value in use, a pre-tax discount rate is used which reflects the current market assessments of the time value
of money and the risks specific to the asset. Any resulting impairment loss is recognised immediately in the
statement of comprehensive income.
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
NOTES TO THE FINANCIAL STATEMENTS (Continued)
FOR THE YEAR ENDED 30 JUNE 2024
23
(d) Receivables
Trade and other receivables are stated at fair value and subsequently measured at amortised cost, less
expected credit losses.
(e) Business combinations
The acquisition method of accounting is used to account for all business combinations, including business
combinations involving entities or business under common control, regardless of whether equity instruments
or other assets are acquired.
The consideration transferred for the acquisition of a subsidiary comprises the fair value of the assets
transferred, the liabilities incurred and the equity interests issued by the consolidated entity. The consideration
transferred also includes the fair value of any contingent consideration arrangement and the fair value of any
pre-existing equity interest in the subsidiary.
Acquisition-related costs are expensed as incurred. Identifiable assets acquired and liabilities and contingent
liabilities assumed in a business combination are, with limited exceptions, measured initially at their fair values
at the acquisition date. On an acquisition-by-acquisition basis, the consolidated entity recognises any non-
controlling interest in the acquiree either at fair value or at the non-controlling interest’s proportionate share of
the acquiree’s net identifiable assets.
The excess of the consideration transferred the amount of any non-controlling interest in the acquiree and the
acquisition-date fair value of any previous equity interest in the acquiree over the fair value of the consolidated
entity’s share of the net identifiable assets acquired is recorded as goodwill. If those amounts are less than
the fair value of the net identifiable assets of the subsidiary acquired and the measurement of all amounts has
been reviewed, the difference is recognised directly in profit or loss as a bargain purchase.
Where settlement of any part of cash consideration is deferred, the amounts payable in the future are
discounted to their present value as at the date of exchange. The discount rate used is the entity’s incremental
borrowing rate, being the rate at which a similar borrowing could be obtained from an independent financier
under comparable terms and conditions.
Contingent consideration is classified as either equity or a financial liability. Amounts classified as a financial
liability are subsequently remeasured to fair value with changes in fair value recognised in the statement of
comprehensive income.
(f) Exploration and evaluation expenditure
Exploration and evaluation expenditure incurred is accumulated in respect of each identifiable area of interest.
These costs are only carried forward to the extent that the consolidated entity’s rights of tenure to the area are
current and that the costs are expected to be recouped through the successful development of the area or by
its sale, or where activities in the area have not yet reached a stage that permits reasonable assessment of
the existence of economically recoverable reserves.
Each area of interest is assessed for impairment to determine the appropriateness of continuing to carry
forward costs in relation to that area of interest. Impairment testing is carried out in accordance with Note 1(c).
Accumulated costs in relation to an abandoned area are written off in full against profit or loss in the year in
which the decision to abandon the area is made. Once the technical feasibility and commercial viability of the
extraction of mineral resources in an area of interest are demonstrable, exploration and evaluation assets
attributable to that area of interest are first tested for impairment and then reclassified to mine development
properties.
(g) Taxes
The charge for current income tax expense is based on the result for the year adjusted for any non-assessable
or disallowed items. It is calculated using tax rates that have been enacted or are substantively enacted by
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
NOTES TO THE FINANCIAL STATEMENTS (Continued)
FOR THE YEAR ENDED 30 JUNE 2024
24
balance date. Deferred tax is accounted for using the statements of financial position liability method in respect
of temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in
the financial statements. No deferred income tax will be recognised from the initial recognition of an asset or
liability, excluding a business combination, where there is no effect on accounting or taxable profit or loss.
Deferred tax 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 recognised in the statement of comprehensive income except where it
relates to items recognised directly in equity, in which case it is recognised in equity. Deferred income tax
assets are recognised for deductible temporary differences and unused tax losses only if it is probable that
future taxable amounts will be available to utilise those temporary differences and tax losses. Deferred tax
assets and liabilities are offset when they relate to income taxes levied by the same taxation authority and the
group intends to settle its current tax assets and liabilities on a net basis.
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 consolidated entity
will derive sufficient future assessable income to enable the benefit to be realised and comply with the
conditions of deductibility imposed by the law. The carrying amount of deferred tax assets is reviewed at each
balance date and only recognised to the extent that sufficient future assessable income is expected to be
obtained.
Tax consolidation
The Company and its wholly-owned Australian resident-controlled entities have formed a tax-consolidated
entity and are therefore taxed as a single entity. Korab Resources Limited is the head entity of the tax-
consolidated entity. In future periods the members of the consolidated entity will, if required, enter into a tax
sharing agreement whereby each company in the consolidated entity contributes to the income tax payable in
proportion to their contribution to the net profit before tax of the tax consolidated entity.
(h) Trade and other payables
Trade payables and other payables are carried at amortised cost and represent liabilities for goods and services
provided to the Group prior to the end of the financial year that are unpaid and arise when the Group becomes
obliged to make future payments in respect of the purchases of these goods and services. Trade and other
payables are represented as current liabilities unless payment is not due within 12 months.
(i) Earnings per share
The consolidated entity presents basic and diluted earnings per share (“EPS”) for its ordinary shares. Basic
EPS is calculated by dividing the result attributable to equity holders of the Company by the weighted number
of shares outstanding during the period. Diluted EPS is determined by adjusting the profit or loss attributable
to ordinary shareholders and the weighted average number of ordinary shares outstanding for the effects of
all potential ordinary shares, which comprise share options granted.
(j) Share based payments
The fair value of shares and share options granted as compensation is recognised as an expense with a
corresponding increase in equity. Fair value is measured at grant date and recognised over the period during
which the grantees become unconditionally entitled to the shares or share options. The fair value of share
grants at grant date is determined by the share price at that time. The fair value of share options at grant date
is determined using a Black-Scholes option pricing model that takes into account the exercise price, the term
of the option, any vesting and performance criteria, the share price at grant date, the expected price volatility
of the underlying share, the expected dividend yield and the risk free rate for the term of the option. Upon the
exercise of the option, the balance of the share-based payments reserve relating to the option is transferred
to contributed equity.
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
NOTES TO THE FINANCIAL STATEMENTS (Continued)
FOR THE YEAR ENDED 30 JUNE 2024
25
(k) Cash and cash equivalents
Cash and cash equivalents include cash on hand, deposits held at call with financial institutions, other short-
term, and highly liquid investments with original maturities of three months or less that are readily convertible
to known amounts of cash and which are subject to an insignificant risk of changes in value.
(l) Employee benefits
Provision is made for the consolidated entity’s liability for employee benefits and termination indemnities
arising from services rendered by employees to balance date.
(i)Short-term benefits
Employee benefits that are expected to be settled within one year have been measured at the amounts
expected to be paid when the liability is settled, plus related on-costs.
(ii) Long-term employee benefit obligations
The liability for long service leave and annual leave which is not expected to be settled within 12 months after
the end of the period in which the employees render the related service is recognised in the provision for
employee benefits and measured as the present value of expected future payments to be made in respect of
services provided by employees up to the end of the reporting period.
(m) Contributed equity
Ordinary shares are classified as equity. Incremental costs directly attributable to an equity transaction are
shown as a deduction from equity, net of any recognised income tax benefit.
(n) Goods and services tax
Revenues, expenses and assets are recognised net of the amount of goods and services tax (“GST”), except
where the amount of GST incurred is not recoverable from the Australian Tax Office. In these circumstances
the GST is recognised as part of the cost of acquisition of the asset or as part of the expense. Receivables
and payables in the statement of financial position are shown inclusive of GST. Cash flows are presented in
the cash flow statement on a gross basis, except for the GST component of investing and financing activities,
which are disclosed as operating cash flows.
(o) Comparative figures
When required by Accounting Standards, comparative figures have been adjusted to conform to changes in
presentation for the current financial period.
(p) Foreign currency
Functional and presentation currency
The functional currency of each of the consolidated entity’s entities is measured using the currency of the
primary economic environment in which that entity operates (the “functional” currency). The consolidated
financial statements are presented in Australian dollars which is the parent entity’s functional and presentation
currency.
Transactions and balances
Foreign currency transactions are translated into functional currency using the exchange rates prevailing at
the date of the transaction. Foreign currency monetary assets and liabilities are translated at the exchange
rate at balance date. Non-monetary items measured at historical cost continue to be carried at the exchange
rate at the date of the transaction.
Exchange differences arising on the translation of monetary items are recognised in the profit and loss, except
where deferred in equity as a qualifying cash flow or net investment hedge.
Foreign operations
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
NOTES TO THE FINANCIAL STATEMENTS (Continued)
FOR THE YEAR ENDED 30 JUNE 2024
26
The financial performance and position of foreign operations whose functional currency is different from the
consolidated entity’s presentation currency are translated as follows:
•
assets and liabilities are translated at exchange rates prevailing at statement of financial position date.
•
income and expenses are translated at transaction date or average exchange rates for the period,
whichever is more appropriate.
Exchange differences arising on translation of foreign operations are transferred directly to the consolidated
entity’s foreign currency translation reserve as a separate component of equity. These differences are
recognised in the statement of comprehensive income upon disposal of the foreign operation.
(q) Revenue recognition
Revenue is recognised and measured at the fair value of consideration received or receivable to the extent
that it is probable that the economic benefits will flow to the entity and the revenue can be reliably measured.
The following specific recognition criteria must also be met before revenue is recognized:
Sublease Revenue
Sublease of mining rights is recognised on a straight-line basis over the life of the lease where it is probable
economic benefits will flow to the entity. The sublease of the mining rights requires the lessee to pay the Group
a monthly flat fee, any tenement rents, and other statutory and compliance costs, plus a royalty on phosphate
rock produced and allows the lessee to produce rock phosphate from the tenement subject to lessee’s
compliance with the sublease agreement and all relevant mining and environmental laws and regulations. The
phosphate rights sub-leasing agreement was terminated by the Company on 23 June 2023. Accrued sub-
lease revenue will be recognised in the accounts when payment is received.
Interest
Revenue is recognised as interest accrues using the effective interest rate 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.
(r) Borrowing costs
Interest expenses comprise interest expense on borrowings and the unwinding of the discount on provisions.
(s) Parent entity financial information
The financial information for the parent entity, Korab Resources Limited, disclosed in Note 20 has been
prepared on the same basis as the consolidated financial statements, except as set out below.
(i) Investments in subsidiaries, associates and joint venture entities
Investments in subsidiaries, associates and joint venture entities are accounted for at cost in the financial
statements of Korab Resources Limited. Dividends received from associates are recognised in the parent
entity’s profit or loss, rather than being deducted from the carrying amount of these investments.
(t) Financial instruments
Recognition and derecognition
Financial assets and financial liabilities are recognised when the Group becomes a party to the contractual
provisions of the financial instrument. Financial assets are derecognised when the contractual rights to the
cash flows from the financial asset expire, or when the financial asset and substantially all the risks and
rewards are transferred. A financial liability is derecognised when it is extinguished, discharged, cancelled or
expires.
Classification and initial measurement of financial assets
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
NOTES TO THE FINANCIAL STATEMENTS (Continued)
FOR THE YEAR ENDED 30 JUNE 2024
27
Except for those trade receivables that do not contain a significant financing component and are measured at
the transaction price in accordance with AASB 15, all financial assets are initially measured at fair value
adjusted for transaction costs (where applicable). For the purpose of subsequent measurement, financial
assets, other than those designated and effective as hedging instruments, are classified into the following
categories:
•
amortised cost
•
fair value through profit or loss (FVTPL)
•
equity instruments at fair value through other comprehensive income (FVOCI)
•
debt instruments at fair value through other comprehensive income (FVOCI).
All income and expenses relating to financial assets that are recognised in profit or loss are presented within
finance costs, finance income or other financial items, except for impairment of trade receivables which is
presented within other expenses.
The classification is determined by both:
- the entity’s business model for managing the financial asset, and
- the contractual cash flow characteristics of the financial asset.
Subsequent measurement of financial assets
(i) Financial assets at amortised cost
Financial assets are measured at amortised cost if the assets meet the following conditions (and are not
designated as FVTPL):
•
they are held within a business model whose objective is to hold the financial assets to collect its
contractual cash flows; and
•
the contractual terms of the financial assets give rise to cash flows that are solely payments of principal
and interest on the principal amount outstanding.
After initial recognition, these are measured at amortised cost using the effective interest method. Discounting
is omitted where the effect of discounting is immaterial. The Group’s cash and cash equivalents, trade and
most other receivables fall into this category of financial instruments.
(ii) Financial assets at fair value through profit or loss (FVTPL)
Financial assets that are held within a different business model other than ‘hold to collect’ or ‘hold to collect
and sell’ are categorised at fair value through profit and loss. Further, irrespective of business model financial
assets whose contractual cash flows are not solely payments of principal and interest are accounted for at
FVTPL. All derivative financial instruments fall into this category, except for those designated and effective as
hedging instruments, for which the hedge accounting requirements apply. The category also contains an equity
investment. The Group accounts for the investment at FVTPL and did not make the irrevocable election to
account for the investment in unlisted and listed equity securities at fair value through other comprehensive
income (FVOCI). The fair value was determined in line with the requirements of AASB 9, which does not allow
for measurement at cost. Assets in this category are measured at fair value with gains or losses recognised in
profit or loss. The fair values of financial assets in this category are determined by reference to active market
transactions or using a valuation technique where no active market exists.
(iii) Equity instruments at fair value through other comprehensive income (Equity FVOCI)
Investments in equity instruments that are not held for trading are eligible for an irrevocable election at
inception to be measured at FVOCI. Under Equity FVOCI, subsequent movements in fair value are recognised
in other comprehensive income and are never reclassified to profit or loss. Dividend from these investments
continue to be recorded as other income within the profit or loss unless the dividend clearly represents return
of capital. This category includes unlisted equity securities that were previously classified as ‘available-for-
sale’ under AASB 139. Any gains or losses recognised in other comprehensive income (OCI) are not recycled
upon derecognition of the asset.
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
NOTES TO THE FINANCIAL STATEMENTS (Continued)
FOR THE YEAR ENDED 30 JUNE 2024
28
(iv) Debt instruments at fair value through other comprehensive income (Debt FVOCI)
Financial assets with contractual cash flows representing solely payments of principal and interest and held
within a business model of collecting the contractual cash flows and selling the assets are accounted for at
debt FVOCI. The Group accounts for financial assets at FVOCI if the assets meet the following conditions:
•
they are held under a business model whose objective it is to “hold to collect” the associated cash
flows and sell financial assets; and
•
the contractual terms of the financial assets give rise to cash flows that are solely payments of principal
and interest on the principal amount outstanding.
Any gains or losses recognised in other comprehensive income (OCI) will be recycled upon derecognition of
the asset.
Impairment of financial assets
AASB 9’s impairment requirements use more forward-looking information to recognise expected credit losses
– the ‘expected credit loss (ECL) model’. Instruments within the scope of the requirements include loans and
other debt-type financial assets measured at amortised cost and FVOCI, trade receivables, contract assets
recognised and measured under AASB 15 and loan commitments and some financial guarantee contracts (for
the issuer) that are not measured at fair value through profit or loss. Recognition of credit losses is no longer
dependent on the Group first identifying a credit loss event. Instead the Group considers a broader range of
information when assessing credit risk and measuring expected credit losses, including past events, current
conditions, reasonable and supportable forecasts that affect the expected collectability of the future cash flows
of the instrument.
In applying this forward-looking approach, a distinction is made between:
•
financial instruments that have not deteriorated significantly in credit quality since initial recognition or
that have low credit risk (‘Stage 1’) and
•
financial instruments that have deteriorated significantly in credit quality since initial recognition and
whose credit risk is not low (‘Stage 2’).
•
‘Stage 3’ would cover financial assets that have objective evidence of impairment at the reporting date.
‘12-month expected credit losses’ are recognised for the first category while ‘lifetime expected credit losses’
are recognised for the second category. Measurement of the expected credit losses is determined by a
probability-weighted estimate of credit losses over the expected life of the financial instrument.
Trade and other receivables
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
Group uses its historical experience, external indicators and forward-looking information to calculate the
expected credit losses using a provision matrix. The Group assess impairment of trade receivables on a
collective basis as they possess shared credit risk characteristics they have been grouped based on the days
past due.
Classification and measurement of financial liabilities
The Group’s financial liabilities include borrowings, trade and other payables and derivative financial
instruments. Financial liabilities are initially measured at fair value, and, where applicable, adjusted for
transaction costs unless the Group designated a financial liability at fair value through profit or loss.
Subsequently, financial liabilities are measured at amortised cost using the effective interest method except
for derivatives and financial liabilities designated at FVTPL, which are carried subsequently at fair value with
gains or losses recognised in profit or loss (other than derivative financial instruments that are designated and
effective as hedging instruments).
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
NOTES TO THE FINANCIAL STATEMENTS (Continued)
FOR THE YEAR ENDED 30 JUNE 2024
29
(u) Provisions
Provisions are recognised when the consolidated entity 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. Provisions are determined by discounting the expected future cash flows at a pre-tax
discount rate that reflects current market assessments of the time value of money and, where appropriate, the
risks specific to the liability.
(v) Contingencies
Contingent liabilities are defined as:
•
possible obligations resulting from past events whose existence depends on future events;
•
obligations that are not recognised because it is not probable that they will lead to an outflow of
resources;
•
obligations that cannot be measured with sufficient reliability.
Contingent liabilities are not recognised in the statement of financial position, but are disclosed in the notes to
the financial statements, with the exception of contingent liabilities where the probability of the liability occurring
is remote.
(w) New accounting standards and interpretations
Standards and Interpretations applicable to 30 June 2024
In the year ended 30 June 2024, the Directors have reviewed all of the new and revised Standards and
Interpretations issued by the AASB that are relevant to the consolidated entity and effective for the current
reporting period beginning on or after 1 July 2023. The Directors have determined that there is no material
impact of the other new and revised Standards and Interpretations on the consolidated entity and therefore,
no material change is necessary to group accounting policies.
Standards and Interpretations in issue not yet adopted
The Directors have also reviewed all of the new and revised Standards and Interpretations in issue not yet
adopted for the year ended 30 June 2024. As a result of this review the Directors have determined that there
is no material impact, of the new and revised Standards and Interpretations on the consolidated entity and,
therefore, no change is necessary to the consolidated entity’s accounting policies.
2.
REVENUE AND EXPENDITURE
2024
$
2023
$
2(a) Other Income
Reimbursements
59,500
-
59,500
-
2(b) Finance expense
Interest on borrowings – related parties
184,951
169,222
Interest on borrowings – unrelated parties
252,071
184,954
437,022
354,176
2(c) Corporate compliance and management
Contractors and suppliers
454,829
419,550
Compliance
54,284
87,764
Office, promotion, telecommunication, staff, travel
81,134
102,337
Directors
28,730
40,461
618,977
650,112
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
NOTES TO THE FINANCIAL STATEMENTS (Continued)
FOR THE YEAR ENDED 30 JUNE 2024
30
3.
SEGMENT REPORTING
AASB 8 Operating Segments requires operating segments to be identified on the basis of internal reports
about components of the consolidated entity that are reviewed by the chief operating decision maker in order
to allocate resources to the segment and assess its performance. The Executive Chairman of Korab reviews
internal reports prepared such as consolidated financial statements, and strategic decisions of the
consolidated entity are determined upon analysis of these internal reports. During the year the consolidated
entity operated predominantly in one business segment, being the minerals exploration sector. Accordingly,
under the “management approach” outlined only one operating segment has been identified and no further
disclosure is required in the notes to the consolidated financial statements. All non-current assets, revenue
and finance income for the current and prior period have a geographical location in Australia.
2024
$
2023
$
Australia – non-current assets
4,467,518
4,386,064
Australia – revenue
59,500
-
Australia – finance income
108,714
105,644
4.
INCOME TAX EXPENSE
Numerical reconciliation of income tax expense to prima facie tax expense:
Loss before income tax expense
(932,096)
(1,360,200)
Prima facie income tax benefit on pre-tax loss at the Australian income
tax rate of 25% (2023: 25%)
(233,024)
(340,050)
Tax effect of:
Current year tax benefit not brought to account
233,024
340,050
Income tax expense
-
-
Unrecognised deferred tax assets and liabilities
The following deferred tax assets and (liabilities) have not been brought to account:
Tax losses - revenue
19,277,503
18,278,542
Other temporary differences
(3,161,547)
(3,094,682)
16,115,956
15,183,860
At tax rate of 25% (2023: 25%)
4,028,989
3,795,965
The benefit of these losses has not been brought to account at 30 June 2024 because the Directors do not
believe it is appropriate to regard realisation of the deferred tax asset as being probable at this point in time or
that there are sufficient deferred tax liabilities to offset these losses. These tax losses are also subject to final
determination by the Taxation authorities when the Company derives taxable income. The benefits will only
be realised if:
•
The Company derives future assessable income of a nature and of an amount sufficient to enable the
benefit of the deduction for the losses to be realised;
•
The Company continues to comply with the conditions for the deductibility imposed by law; and
•
No changes in the tax legislation adversely affect the Company in realising the benefit of the losses.
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
NOTES TO THE FINANCIAL STATEMENTS (Continued)
FOR THE YEAR ENDED 30 JUNE 2024
31
5.
AUDITORS’ REMUNERATION
Audit and review services:
2024
$
2023
$
Auditors of the Company: Armada Audit and Assurance Pty Ltd
31,500
30,000
31,500
30,000
6.
BASIC LOSS PER SHARE
2024
2023
Cents per Share
Cents per Share
Basic loss per share
(0.25)
(0.37)
2024
$
2023
$
Loss from operations attributable to ordinary equity holders of Korab
used to calculate basic and diluted earnings per share
(932,096)
(1,360,200)
Weighted average number of shares
Number of
shares
Number of
shares
1 July (basic and diluted)
367,050,000
367,050,000
30 June (basic and diluted)
367,050,000
367,050,000
7.
TRADE RECEIVABLES AND OTHER FINANCIAL ASSETS
2024
$
2023
$
Current
Trade and other receivables
15,905
4,455
15,905
4,455
Non-current
Other financial assets
1,305,971
1,291,382
1,305,971
1,291,382
$11,450 of the current (2023: $Nil) and $1,294,075 (2023: $1,279,487) of the non-current financial assets is a
secured receivable from Polymetallica Minerals Limited (formerly Uranium Australia Ltd), a company in which
Mr Andrej Karpinski is Executive Chairman and a significant shareholder. The loan has an interest rate of 8.5%
and is not payable prior to 31 October 2025. The balance of outstanding amounts from Polymetallica Minerals
Limited consist of funds provided by the Company to pay for tenement rents and other project related costs in
relation to projects where the Company and Polymetallica have, or had, joint venture arrangements, and/or
production sharing agreements, plus any accrued interest. These joint venture arrangements and/or
production sharing agreements were established when Polymetallica was a subsidiary of the Company prior
to Polymetallica being demerged (spun-off) from the Company. The Company has registered security over all
current and future assets of Polymetallica until the debt is discharged in full. The directors have assessed this
loan for impairment at 30 June 2024 and based on the evidence obtained no impairment expense was
required. Korab has received an independent valuation of Polymetallica's mineral assets valuing them in
excess of the balance of the loan to Polymetallica and as such, no impairment expense was required There
has been no other funding provided by the Company to Polymetallica during the year ended 30 June 2024.
8.
EXPLORATION AND EVALUATION
2024
$
2023
$
Areas of interest in the exploration and evaluation phase:
Cost at beginning of the year
4,297,951
3,942,996
Capitalised contractors’ expenses
239,595
267,670
Other expenditure capitalised during the period
69,729
87,285
Cost at end of the year
4,607,275
4,297,951
Impairment provision
(1,445,728)
(1,203,269)
Carrying amount at the end of the year
3,161,547
3,094,682
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
NOTES TO THE FINANCIAL STATEMENTS (Continued)
FOR THE YEAR ENDED 30 JUNE 2024
32
Bobrikovo gold and silver project is located in the Luhansk region in eastern Ukraine. The capitalised
exploration and evaluation expenditure attributable to the Bobrikovo project has been written-off at
consolidation level in the year ended 30 June 2014 to reflect the ongoing situation in the Luhansk region.
The recoupment of costs carried forward in relation to areas of interest in the exploration and evaluation phases
is dependent on the successful development and commercial exploitation or sale of the respective areas.
9.
TRADE AND OTHER PAYABLES
2024
$
2023
$
Current
Trade payables and accrued expenses (i)
218,816
170,580
Sundry payables - related parties
23,291
20,561
242,107
191,141
(i) Trade payables are non-interest bearing and are normally settled within 45 days.
10.
LOANS AND BORROWINGS
2024
$
2023
$
Current
Loans payable - related parties – unsecured (i)
35,150
35,000
35,150
35,000
Non-current
Loans payable - related parties – unsecured (i)
1,871,670
1,432,780
Loans payable - third parties – unsecured (ii)
2,380,953
1,844,990
4,252,623
3,277,770
(i)
The terms and conditions of related party loans and borrowings are set out in Notes 16 and 17,
Related Party Transactions and Key Management Personnel Disclosures respectively.
(ii)
The third party loans and borrowings are on arms-length terms and conditions. The third party loans
and borrowings are not payable prior to 31 October 2025 and are at an interest rate of 12%.
11.
SUBSIDIARIES
Country of
incorporation
Class of
shares
Equity holding
2024
2023
Held by parent
Lugansk Gold Pty Limited
Australia
Ordinary
100%
100%
Geolsec Phosphate Operations Pty Limited
Australia
Ordinary
100%
100%
Melrose Gold Mines Pty Limited
Australia
Ordinary
100%
100%
Australian Copper Pty Limited
Australia
Ordinary
100%
100%
Ausmag Pty Limited
Australia
Ordinary
100%
100%
Held by Australian Copper Pty Limited
Australian Copper Holdings Pty Limited
Australia
Ordinary
100%
100%
Held by Lugansk Gold Pty Limited
LLC “Donetsky Kryazh”
Ukraine
Ordinary
100%
100%
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
NOTES TO THE FINANCIAL STATEMENTS (Continued)
FOR THE YEAR ENDED 30 JUNE 2024
33
12.
SUBSEQUENT EVENTS
Forfeiture application
On 1 July 2024 the Company announced that Andrew James Hawker, a director, sole shareholder, and
principal geologist of Hawker Geological Services Pty Ltd (HGS Australia) has lodged a forfeiture application
against the tenement E08/2757 previously held by Korab's subsidiary Australian Copper Pty Ltd. Andrew
Hawker formerly acted (through HGS Australia) as a geological consultant to Korab and its subsidiaries,
including Australian Copper Pty Ltd. Tenement E08/2757 covered 5 blocks within Ashburton Mineral Field and
was the last remaining granted tenement of the Mt Elephant Project. Australian Copper Pty Ltd has
surrendered tenement E08/2757. Consequently, the Mt Elephant Project now consists of two applications for
exploration licences ELA08/3561 and ELA52/4223. Korab also has a right to acquire exploration licence
resulting from an eventual grant of an application for exploration licence ELA08/3560 made by Rheingold
Investments Corporation Pty Ltd (a company controlled by Korab’s Executive Chairman Mr. Karpinski) in
exchange for reimbursement of the application fee and prepaid 1st year’s tenement rent.
Suspension from quotation on ASX
On 29 July 2024 ASX announced the securities of Korab Resources Limited will be suspended from quotation
immediately under Listing Rule 17.3. ASX has determined that Korab’s level of operations is not adequate to
warrant the continued quotation of its securities and therefore is in breach of Listing Rule 12.1. The suspension
will continue until such time that ASX is satisfied with Korab’s compliance with the Listing Rules, including
Listing Rule 12.1, and that it is otherwise appropriate for Korab’s securities to be reinstated to quotation.
Geolsec mineral lease ML27362
On 19 August 2024 the Company advised that Korab and Geolsec Phosphate Operations Pty Ltd (GPO) have
executed binding Heads of Agreement (HoA) with an unrelated party, Leka II Shipping Limited (Leka) to sell
to Leka all Korab Group’s rights, title and interests in and to the Geolsec mineral lease ML27362 and all mining
exploration information relating to the mineral lease (the Assets) for a cash consideration of $4.35 million and
a royalty of 10% of Net Smelter Returns on all minerals other than uranium and thorium and a royalty of 1%
of Net Smelter Returns on uranium and thorium (the Transaction). Mineral lease ML27362 is 100% owned by
Geolsec Phosphate Operations Pty Ltd (wholly owned subsidiary of Korab Resources Ltd) and is located some
60 km south of Port of Darwin in the Northern Territory of Australia. Under the HoA, Leka II Shipping Limited
will pay to Korab Group a deposit of 10% of cash consideration with the balance of cash consideration payable
on completion. Completion is envisaged to take place in 120 days from the signing of the HoA being 16 August
2024. The completion date may be changed by agreement between the parties.
Under the HoA, if ASX required Korab to obtain shareholder approval for this transaction, such approval had
to be obtained within 45 days, or as amended by agreement between the parties. Following the end of the
reporting period, on 19 September 2024 Korab advised that following its submission to ASX seeking a
determination whether a shareholder approval is required for the Transaction pursuant to the ASX Listing
Rules, the Company has received from ASX confirmation that ASX does not consider that either Listing Rule
11.1 or 11.2 applies to the proposed sale of Mineral Lease ML27362. Therefore, the Transaction does not
require shareholder approval and consequently the Company does not intend to call an Extraordinary General
Meeting of shareholders for the purpose of approving the Transaction. The Company has advised Leka
accordingly.
The HoA is binding on Korab Group and Leka. The HoA contains customary conditions, warranties, and
assurances usual to these types of agreements. The key conditions of the transaction are that prior to and
upon completion, GPO will ensure that there has been no material adverse change to the Assets and that the
mineral lease ML27362 is in good standing. Furthermore, any party may lodge such caveats or other security
pursuant to the Mining Act as it thinks fit to protect its interests in the transaction.
The HoA requires compliance by the parties in all respects with the Corporations Act 2001 (Cth) and the ASX
Listing Rules as they apply to the transaction and requires respective parties to obtain all government, statutory
or regulatory approvals, consents and/or permits required to enable parties to perform their obligations under
the HoA, including Ministerial approval to the transfer of the mineral lease if such is required. The parties agree
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
NOTES TO THE FINANCIAL STATEMENTS (Continued)
FOR THE YEAR ENDED 30 JUNE 2024
34
to use their best endeavours to ensure that the conditions are satisfied as quickly as possible and, in any
event, on or before the deadlines set out above. Korab intends to use the proceeds from this transaction to
retire debt, for working capital purposes, and for exploration and development work on its projects, with the
focus on Rum Jungle Project. There are no changes to the board or senior management proposed as a
consequence of the transaction.
No other matter or circumstance has arisen since 30 June 2024 that in the opinion of the directors has
significantly affected, or may significantly affect in future financial years the consolidated entity’s operations,
the results of those operations, or the consolidated entity’s state of affairs.
13.
RECONCILIATION OF CASH FLOWS USED IN OPERATING ACTIVITIES
2024
2023
$
$
(a)
Reconciliation of (loss) after income tax to net cash (outflow) from
operating activities
(Loss) for the year
(932,096)
(1,360,200)
Non-cash items
Fees and other expenses converted to debt
401,050
392,990
Net accrued interest expense
299,152
251,297
Foreign exchange loss
331
1,720
Impairment of exploration expenditure
242,459
652,591
Change in assets and liabilities
- (Increase) in trade receivables and other financial assets
(26,039)
(52,141)
- (Increase) in prepayments
(20,000)
-
- Increase in trade and other payables
(50,966)
20,906
Net cash (outflow) from operating activities
(86,109)
(92,837)
(b) Cash and cash equivalents
Cash at bank and at call
93,351
112,382
Cash balances include $12,900 (2023: $12,900) term deposit securing a bank guarantee in favour of the
Department of Primary Industry and Resources.
(c) Risk exposure
The consolidated entity’s exposure to interest rate risk is discussed in Note 15. The maximum exposure to
credit risk at the reporting date is the carrying amount of each class of cash and cash equivalents mentioned
above.
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
NOTES TO THE FINANCIAL STATEMENTS (Continued)
FOR THE YEAR ENDED 30 JUNE 2024
35
14.
CAPITAL AND RESERVES
(a) Contributed equity:
2024
2024
2023
2023
Number
$
Number
$
Movements in ordinary shares on issue
1 July
367,050,000
21,186,134
367,050,000
21,186,134
30 June
367,050,000
21,186,134
367,050,000
21,186,134
Ordinary shares have the right to one vote per share at meetings of the Company, to receive dividends as
declared and, in the event of a winding-up of the Company, to participate in the proceeds from the sale of all
surplus assets in proportion to the number of, and amounts paid up on, shares held.
(b) Accumulated losses
2024
2023
$
$
1 July
(18,065,037)
(16,704,837)
Loss for the period
(932,096)
(1,360,200)
30 June
(18,997,133)
(18,065,037)
(c) Foreign currency translation reserve
The foreign currency translation reserve comprises all foreign exchange
differences arising from the translation of the financial statements of foreign
operations where their functional currency is different to the presentation
currency of the reporting entity.
1 July
(997,078)
(997,078)
30 June
(997,078)
(997,078)
(d) Non-controlling interest contribution reserve
The non-controlling interest contribution reserve represents the net proceeds from / expenditure on the sale
of / acquisition of minority interests, net of the share of net assets disposed / acquired.
2024
2023
$
$
1 July
(1,036,227)
(1,036,227)
30 June
(1,036,227)
(1,036,227)
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
NOTES TO THE FINANCIAL STATEMENTS (Continued)
FOR THE YEAR ENDED 30 JUNE 2024
36
15.
FINANCIAL RISK MANAGEMENT
General objectives, policies and processes
The consolidated entity’s activities expose it to credit risk, market risk (including interest rate risk, price risk
and currency risk), liquidity risk, and commodity price risk. This note presents qualitative and quantitative
information about the consolidated entity’s exposure to each of the above risks, their objectives, policies and
procedures for managing risk, and the management of capital. The Board of Directors has overall responsibility
for the establishment and oversight of the risk management framework.
The consolidated entity’s overall risk management approach focuses on the unpredictability of financial
markets and seeks to minimise the potential adverse effects on the financial performance of the consolidated
entity. The consolidated entity does not currently use derivative financial instruments to hedge financial risk
exposures and therefore it is exposed to daily movements in commodity prices, interest rates and exchange
rates. The consolidated entity uses various methods to measure different types of risk to which it is exposed.
These methods include sensitivity analysis in the case of interest rates and ageing analysis for credit risk.
The Board’s policy is to maintain a strong capital base so as to maintain investor, creditor, and market
confidence and to sustain future development of the business. Given the stage of the consolidated entity’s
development there are no formal targets set for return on capital. There were no changes to the consolidated
entity’s approach to capital management during the year. Neither the Company nor any of its subsidiaries are
subject to externally imposed capital requirements.
(a) Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in a financial
loss to the consolidated entity. The consolidated entity has no significant concentration of credit risk. Exposure
to credit risk is considered minimal but is monitored on an ongoing basis.
Cash transactions are limited to financial institutions considered to have a suitable credit rating. The maximum
exposure to credit risk is represented by the carrying amount of each financial asset in the statement of
financial position at balance date. The carrying amount of the consolidated entity’s financial assets represents
the maximum credit exposure.
The consolidated entity’s maximum exposure to credit risk at the reporting date was:
2024
$
2023
$
Carrying amount:
Cash and cash equivalents
93,351
112,382
Trade and other receivables
15,905
4,455
Prepayments
108,802
88,802
Other financial assets
1,305,971
1,291,382
1,524,029
1,497,021
See Note 7 for explanation and details of other financial assets.
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
NOTES TO THE FINANCIAL STATEMENTS (Continued)
FOR THE YEAR ENDED 30 JUNE 2024
37
(b) Market risk
(i)
Interest rate risk
The significance and management of the risks to the consolidated entity is dependent on a number of factors
including (i) interest rates (current and forward) and the currencies that are held; (ii) level of cash and liquid
investments;(iii) maturity dates of investments; and (iv) proportion of investments that are fixed rate or floating
rate.
The risk is managed by the consolidated entity maintaining an appropriate mix between fixed and floating rate
investments. All cash assets are held in Australian dollars.
The consolidated entity’s exposure to interest rate risk is considered minimal. The effective interest rates of
variable rate income-earning financial assets at the reporting date are as follows.
Variable rate
instruments
at call
Weighted
average effective
interest rate
Variable rate
instruments
at call
Weighted
average effective
interest rate
2024 ($)
2024
2023 ($)
2023
Financial assets
Cash and cash equivalents
93,351
1.8%
112,382
1.8%
At the reporting date the carrying amount of the consolidated entity’s interest bearing financial assets was:
2024 ($)
2023 ($)
Variable rate instruments
93,351
112,382
Fixed rate instruments
1,305,526
1,279,487
At the reporting date the carrying amount of the consolidated entity’s interest bearing financial liabilities was:
2024 ($)
2023 ($)
Fixed rate instruments
4,287,773
3,312,770
Sensitivity analysis
A 100 basis points increase or decrease in the weighted average year-end interest rate of variable rate
instruments would have increased / (decreased) consolidated profit or loss and equity by the amounts shown
below. This analysis assumes that all other variables remain constant. The analysis was performed on the
same basis for 2023:
Profit and loss ($)
30 June 2024 increase
934
30 June 2024 decrease
(934)
30 June 2023 increase
1,124
30 June 2023 decrease
(1,124)
(ii) Price risk
The consolidated entity was not exposed to equity securities price risk at 30 June 2024 or 30 June 2023.
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
NOTES TO THE FINANCIAL STATEMENTS (Continued)
FOR THE YEAR ENDED 30 JUNE 2024
38
(iii) Currency risk
The Company has one US$ denominated loan with a value of A$127,479 (US$83,203) (30 June 2023:
A$112,384 / US$73,270). Other than this the consolidated entity had no material exposure from changes in
foreign currency exchange rates during the 30 June 2024 or 30 June 2023 years.
(c) Liquidity risk
Liquidity risk is the risk that the consolidated entity will not be able to meet its financial obligations as and when
they fall due. The consolidated entity’s approach to managing this risk is to ensure, as far as possible, that it
will always have sufficient liquidity to meet its liabilities when due under a range of financial conditions. The
following are the contractual maturities of consolidated non-derivative financial liabilities:
Carrying
amount ($)
Contractual
cashflows ($)
6 months
or less ($)
1 to 5
years ($)
2024
Trade and other payables
242,107
242,107
242,107
-
Loans and borrowings
4,287,773
4,287,773
35,150
4,252,623
4,529,880
4,529,880
277,257
4,252,623
2023
Trade and other payables
191,141
191,141
191,141
-
Loans and borrowings
3,312,770
3,312,770
35,000
3,277,770
3,503,911
3,503,911
226,141
3,277,770
Please refer to Notes 16 and 17 for the terms and conditions for loans and borrowings.
(d) Commodity price risk
The consolidated entity is not exposed to commodity price risk at 30 June 2024 or 30 June 2023.
(e) Fair values
The fair values of consolidated financial assets and financial liabilities, together with their carrying amounts
shown in the statement of financial position, are as follows:
Consolidated
Carrying amount
Fair value
Carrying amount
Fair value
2024 ($)
2024 ($)
2023 ($)
2023 ($)
Cash and cash equivalents
93,351
93,351
112,382
112,382
Other financial assets
1,305,971
1,305,971
1,291,382
1,291,382
Trade and other receivables
15,905
15,905
4,455
4,455
Prepayments
108,802
108,802
88,802
88,802
Loans and borrowings
(4,287,773)
(4,287,773)
(3,312,770)
(3,312,770)
Trade and other payables
(242,107)
(242,107)
(191,141)
(191,141)
(3,005,851)
(3,005,851)
(2,006,890)
(2,006,890)
Trade and other receivables / payables carrying amounts are considered to reflect their fair value. The basis
for determining fair values is disclosed in Note 1(t).
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
NOTES TO THE FINANCIAL STATEMENTS (Continued)
FOR THE YEAR ENDED 30 JUNE 2024
39
16.
RELATED PARTY TRANSACTIONS
Korab Resources Limited is the ultimate parent entity. Interests in subsidiaries are disclosed in Note 11 and
details of key management personnel compensation is set out in Note 17. The remuneration of key
management personnel is set out in the Remuneration Report. Related party payables and loans and
borrowings are disclosed in Notes 9 and 10. Mr Andrej Karpinski is a director and controlling shareholder of
Rheingold Investments Corporation Pty Ltd (“Rheingold”). Mrs Alicja Karpinski is a director and a shareholder
of Rheingold. Management contract fees form part of the remuneration of directors and have been disclosed
as such in the directors' report.
2024
2022
$
$
Fees to Rheingold Investments Corporation Pty Ltd for:
- Management contract fees
327,000
327,000
Total fees to Rheingold Investments Corporation Pty Ltd
327,000
327,000
2024
2023
$
$
Loans owing to Rheingold Investments Corporation Pty Ltd
1,424,715
1,091,708
Loans owing to Anthony Wills
319,476
263,688
Outstanding liabilities to Alicja Karpinski
127,479
112,384
Total related party debt
1,871,670
1,467,780
During the prior period the directors and Rheingold agreed to suspend payments of the executive services
fees (management contract fees) and directors’ fees. The unpaid fees are being accrued. The balance of
outstanding liabilities to Rheingold, Mr. Karpinski, Mrs Karpinski and their related entities at period end for
loans to the parent entity and unpaid fees is $1,552,194 (2023: $1,204,092) at an average interest rate of 12%.
The loans and unpaid fees are not payable prior to 30 October 2025. These loans and debt become payable
immediately on change of control of Korab. To reduce Korab’s operating costs, Mr. Karpinski and Mrs.
Karpinski have waved their rights to receive directors’ fees from Korab. Mr. Karpinski and Mrs. Karpinski do
not receive directors’ fees and have not received any directors' fees from Korab or its subsidiaries since the
formation of Korab in March 1998 to the date of this report. In addition to corporate management services,
Rheingold Investments Corporation Pty Ltd provides to the Company tenement management, mineral
exploration, company secretarial, and accounting/bookkeeping services. The costs of these services are fully
covered by and included in the Management contract fees paid to Rheingold.
During the reporting period accrued Rheingold management fees were converted to loans and some of the
prior year loans and converted fees were repaid.
Interest accrued to Rheingold, Mr. Karpinski, Mrs. Karpinski and their related entities during the reporting
period was $151,264 (2023: $121,847). The balance of outstanding liabilities to Rheingold, Mr. Karpinski, Mrs
Karpinski and their related entities at period end for loans to the parent entity and unpaid fees includes a loan
from Alicja Karpinski, which at period end had a balance of US$83,203 (A$127,479 at the applicable foreign
exchange rate) (2023: US$73,270, or $112,384 at applicable foreign exchange rate) at an interest rate of 12%.
The loan is not payable prior to 31 October 2024. This loan becomes payable immediately on change of control
of Korab. Above interest accrued to Rheingold, Mr. Karpinski, Mrs. Karpinski and their related entities during
the reporting period includes interest accrued to Mrs. Karpinski of $14,764 (2023: $13,083).
The balance of outstanding liabilities to directors, excluding Mr. Karpinski, Mrs. Karpinski and their related
entities at period end for loans to the parent entity and unpaid fees is $319,476 (2023: $263,688) at an average
interest rate of 12%. The balance of outstanding liabilities to Mr. Wills at period end for loans to the parent
entity and unpaid fees is $319,476 (2023: $263,688). Interest accrued to Mr. Wills was $33,687 (2023:
$27,462) for the year ended 30 June 2024.
The amount within trade and other payables owed to Directors is $23,291 (2023: $20,561), refer to Note 9.
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
NOTES TO THE FINANCIAL STATEMENTS (Continued)
FOR THE YEAR ENDED 30 JUNE 2024
40
Mr Andrej Karpinski is a director and significant shareholder of Polymetallica Minerals Limited (formerly
Uranium Australia Pty Ltd). The balance of outstanding receivables from Polymetallica Minerals Limited at
period end is $1,305,526 (2023: $1,279,487) at an interest rate of 8.5%. The receivable is not payable prior to
31 October 2025. The balance of outstanding receivables from Polymetallica Minerals Limited consist of funds
provided by Company to pay for tenement rents and other project related costs in relation to projects where
the Company and Polymetallica have, or had joint venture arrangements, and/or production sharing
agreements, plus any accrued interest. These joint venture arrangements and/or production sharing
agreements were established when Polymetallica was a subsidiary of the Company prior to Polymetallica
being demerged (spun-off) from the Company. The Company has a registered security over all current and
future assets of Polymetallica until the debt is repaid in full. During the year Polymetallica paid the Company
$Nil (2023: $Nil) in principal and $82,010 (2023: $12,000) in interest with the remaining interest of $ 26,039
(2023: $90,879) accruing. The total interest charged on the loan for the year ended 30 June 2024 was
$108,049 (2023: $102,879).
On 27 February 2024, the Company reported that its subsidiaries Australian Coper Pty Ltd and Australian
Copper Holdings Pty Ltd are objecting in the Wardens court to a purported application by Ashcroft Resources
Pty Ltd for exploration licence E08/3315 (the Proceedings). In the same report, the Company advised that it
proposes to acquire from a related party, Rheingold Investments Corporation Pty Ltd (Rheingold), a company
controlled by the Company’s Executive Chairman Andrej K. Karpinski exploration licence E08/3560 should the
above objection be successful and the exploration licence E08/3560 be granted. Application for E08/3560 and
purported application E08/3315 cover broadly same ground. The proposed acquisition is subject to
shareholder approval should it be required by ASX. If the Company acquires exploration licence E08/3560, it
will reimburse Rheingold for its reasonable out of pocket expenses incurred in the process of applying for the
E08/3560 and progressing it to grant. On 6 March 2024, the Company reported that the Warden adjourned
the Proceedings for mention hearing on 6 May 2024, with no orders to cost. The Proceedings have been
further adjourned by the Warden for mention hearing on 20 December 2024.
17.
KEY MANAGEMENT PERSONNEL DISCLOSURES
Apart from the details disclosed in this note, no director has entered into a material contract with the
consolidated entity since the end of the previous financial year and there were no material contracts involving
directors’ interests existing at year end.
(a) Key management personnel compensation
Names and positions of key management personnel at any time during the year were:
Name
Position
Andrej Karpinski
Executive Chairman
Alicja Karpinski
Non-Executive Director
Anthony Wills
Non-Executive Director
Key management personnel compensation included in corporate compliance and management costs is as
follows:
2024 ($)
2023 ($)
Short term benefits
353,000
364,515
Post-employment
2,730
2,946
355,730
367,461
Information regarding individual directors and executives' compensation is provided in the Remuneration
Report. Details of equity instruments held directly, indirectly or beneficially by key management personnel and
their related parties are included in the directors’ report.
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
NOTES TO THE FINANCIAL STATEMENTS (Continued)
FOR THE YEAR ENDED 30 JUNE 2024
41
(b) Other key management personnel transactions
Amounts payable to key management personnel at reporting date in respect of outstanding fees, expenses
and loans are:
2024 ($)
2023 ($)
Current
Trade and other payables
23,291
20,561
Loans and borrowings
35,150
35,000
Non-current
Loans and borrowings
1,836,520
1,432,780
18.
CONTINGENT ASSETS AND LIABILITIES
Australian Copper Holdings Pty Ltd (ACH), a subsidiary of Australian Copper Pty Ltd, which in turn is a
subsidiary of Korab, is pursuing a claim against Mining Resource Development Corporation Pty Ltd (MRDC)
for $450,000 plus interest on the basis that MRDC failed to make the payment of $450,000 by 3 August 2016
and in doing so committed a further breach of the agreements between MRDC and ACH or repudiated the
agreements by failing to be ready willing and able to complete MRDC’s obligations. In May 2023 MRDC applied
to the court to have the case summarily dismissed. MRDC’s application was dismissed in August 2023 with
the costs of application for summary dismissal awarded to ACH. MRDC indicated to ACH that it intended to
appeal the dismissal of its application for summary judgment. MRDC and ACH attended a mediation
conference in October 2023. MRDC filed an appeal against the dismissal of its application for summary
judgment and MRDC’s appeal was heard in November 2023. A District Court judge delivered a judgment in
MRDC’s appeal in December 2023 upholding MRDC’s appeal with costs of summary application and appeal
awarded to MRDC. ACH filed a notice of appeal to the Supreme Court, Court of Appeal, appealing the District
Court Judge’s December 2023 decision. In February 2024, ACH filed the appellants case in the Supreme
Court of Western Australia. ACH’s appeal is yet to be heard.
Australian Copper Holdings Pty Ltd, and Australian Copper Pty Ltd are objecting in the Wardens court to a
purported application by Ashcroft Resources Pty Ltd for exploration licence E08/3315 (the Proceedings). On
6 March 2024, the Company reported that the Warden adjourned the Proceedings for mention hearing on 6
May 2024, with no orders to cost. The Proceedings have been further adjourned by the Warden for mention
hearing on 20 December 2024. On 27 February 2024, the Company advised that it proposes to acquire from
a related party, Rheingold Investments Corporation Pty Ltd a company controlled by the Company’s Executive
Chairman Andrej K. Karpinski (Rheingold), an exploration licence E08/3560 should the above objection be
successful and the exploration licence E08/3560 be granted. Subsequent to the end of the financial year, the
Warden adjourned the mention hearing in respect of this objection to 20 December 2024. Application for
E08/3560 and purported application E08/3315 cover broadly same ground. The proposed acquisition is subject
to shareholder approval should it be required by ASX. If the Company acquires exploration licence E08/3560,
it will reimburse Rheingold for its reasonable out of pocket expenses incurred in the process of applying for
the E08/3560 and progressing it to the grant.
In the opinion of the directors there were no other material contingent liabilities that existed as at 30 June 2024
or 30 June 2023.
Key Management Personnel Contracts
Contingent liabilities arising from key management personnel contracts are set out in the Remuneration
Report.
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
NOTES TO THE FINANCIAL STATEMENTS (Continued)
FOR THE YEAR ENDED 30 JUNE 2024
42
19.
COMMITMENTS
Lease commitments
The office lease, which commenced on 11 August 2013, has not been extended and now continues on a
month-by-month basis.
Mining tenements
2024
2023
$
$
Annual expenditure commitments to maintain current rights to tenure of
mining tenements
82,000
351,000
82,000
351,000
The consolidated entity has obligations to perform minimum exploration work and to meet annual payments in
respect of rent and granted tenements. These obligations may be varied from time to time subject to approval
and on this basis, they are expected to be fulfilled in the normal course of operations. The Company can also
meet its expenditure obligations by seeking joint venture partners, or by causing other parties to expend funds
on exploration or mining, or by way of sale of all or part of an interest in a tenement, or by allowing tenements
to lapse. Expenditure requirements for applications pending approval are not included.
Mining tenements commitments by Korab Group and third parties
2024
2023
$
$
Korab Group annual expenditure commitments
82,000
351,000
82,000
351,000
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
NOTES TO THE FINANCIAL STATEMENTS (Continued)
FOR THE YEAR ENDED 30 JUNE 2024
43
20.
PARENT ENTITY INFORMATION
The individual financial statements for the parent entity show the following aggregate amounts:
2024
$
2023
$
Statement of Financial Position
Current assets
135,467
205,024
Total assets
4,622,415
4,524,607
Current liabilities
159,044
159,044
Total liabilities
4,466,719
3,436,815
Equity
Contributed equity
21,186,134
21,186,134
Accumulated losses
(21,030,438)
(20,098,342)
155,696
1,087,792
Loss for the year
(932,096)
(1,360,200)
Total comprehensive loss for the year
(932,096)
(1,360,200)
The parent entity has not provided any financial guarantees in respect of subsidiaries, nor did it have any
contingent liabilities as at 30 June 2024 or 30 June 2023.
The Company has obligations to perform minimum exploration work and to meet annual payments in respect
of rent on granted tenements. These obligations may be varied from time to time subject to approval and on
this basis they are expected to be fulfilled in the normal course of operations. The Company can also meet its
expenditure obligations by seeking joint venture partners, or by causing other parties to expend funds on
exploration or mining, or by way of sale of all or part of an interest in a tenement, or by allowing tenements to
lapse. Expenditure requirements for applications pending approval are not included.
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
CONSOLIDATED ENTITY DISCLOSURE STATEMENT
44
Country of
Incorporation
Entity
Type
Principle
Activity
Ownership
Interest
Tax
Residency
Parent Entity
Korab Resources Limited
Held by parent
Australia
Australia
Ordinary
-
Australia
Lugansk Gold Pty Limited
Australia
Australia
Ordinary
100%
Australia
Geolsec Phosphate Operations
Pty Limited
Australia
Australia
Ordinary
100%
Australia
Melrose Gold Mines Pty Limited
Australia
Australia
Ordinary
100%
Australia
Australian Copper Pty Limited
Australia
Australia
Ordinary
100%
Australia
Ausmag Pty Limited
Australia
Australia
Ordinary
100%
Australia
Held by Australian Copper Pty
Limited
Australian Copper Holdings Pty
Limited
Australia
Australia
Ordinary
100%
Australia
Held by Lugansk Gold Pty
Limited
LLC “Donetsky Kryazh”
Ukraine
Ukraine
Ordinary
100%
Ukraine
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
DIRECTORS’ DECLARATION
FOR THE YEAR ENDED 30 JUNE 2024
45
(1) In the opinion of the directors of Korab Resources Limited:
(a)
the financial statements and notes set out on pages 17 to 43 are in accordance with the
Corporations Act 2001, including:
(i)
giving a true and correct view of the consolidated entity’s financial position as at 30 June
2024 and of its performance for the financial year ended on that date; and
(ii)
complying with Accounting Standards, the Corporations Regulations 2001, and other
mandatory professional reporting requirements;
(b) there are reasonable grounds to believe that the Company will be able to pay its debts as and
when they become due and payable.
(2)
The Consolidated Entity Disclosure Statement is true and correct;
This declaration has been made after receiving the declarations required to be made to the directors in
accordance with section 295A of the Corporations Act 2001.
Note 1(a) confirms that the financial statements also comply with International Financial Reporting Standards
as issued by the International Accounting Standards Board.
Signed in accordance with a resolution of the directors.
Andrej K. Karpinski, FAICD, F Fin
Executive Chairman
Perth, Western Australia
28 October 2024
For personal use only
Independent Auditor’s Report
To the Members of Korab Resources Limited
Report on the audit of the financial report
Opinion
We have audited the financial report of Korab Resources Limited (‘the Company’) and its subsidiaries (‘the
“Group’) which, comprises the consolidated statement of financial position as at 30 June 2024, the
consolidated statement of profit or loss and other 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
consolidated financial statements, including a summary of significant accounting policies, and the directors’
declaration.
In our opinion, the accompanying financial report of Korab Resources Limited is in accordance with the
Corporations Act 2001, Including
•
Giving a true and fair view of the Group’s financial position as at 30 June 2024, and of its financial
performance for the year then ended and;
•
Complying with Australian Accounting Standards and the Corporations Regulations 2001.
Material Uncertainty Related to Going Concern
We draw attention to Note 1 (a) in the financial report, which indicates that a material uncertainty exists
that may cast significant doubt on the Group’s ability to continue as a going concern. Our opinion is not
modified in respect of this matter.
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 Accounting Professional and Ethical Standards Board’s APES 110
Code of Ethics for Professional Accountants (“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 given to
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.
For personal use only
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 year. 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 separated
opinion on these matters.
Key Audit Matter
How our audit addressed the key audit matter
Carrying Value of Exploration and Evaluation
Assets (Refer to Note 8)
At 30 June 2024, the Group’s carrying value of
Exploration
and
Evaluation
Assets
was
3,161,547 and recognised an impairment loss of
$242,459
The exploration and evaluation assets are
required to be assessed for impairment when
facts and circumstances suggest that the
carrying amount may exceed their recoverable
amounts. Any impairment losses are then
measured in accordance with AASB 136
Impairment of Assets.
This area is a key audit matter as significant
judgement is required in determining whether:
•
The
capitalised
Exploration
and
Evaluation assets meet the recognition
criteria in terms of AASB 6 Exploration
for
and
Evaluation
of
Mineral
Resources; and
•
Facts and circumstances suggest that
the carrying amount of an exploration
and evaluation asset may exceed its
recoverable amount in accordance with
AASB 6.
Our Procedures, amongst others, included:
•
Confirming whether the rights to tenure for the
areas of interest were current at the reporting
date as well as confirming that the rights to
tenure are expected to be renewed for
tenements that will expire in the near future;
•
Obtaining evidence of the Group’s intention to
carry out exploration and evaluation activities in
the relevant areas of interest. This included
checking announcements made by the Company
to the ASX and checking related exploration work
programmes;
•
Assessing whether the Group has the ability to
fund its exploration and evaluation commitments;
•
Evaluating
Group
documents
such
as
announcements made by the Company to the
ASX to check whether exploration and evaluation
activities in the relevant area of interest were
unsuccessful;
•
For any tenements that were surrendered in an
area of interest we checked that management
had written off the relevant costs at 30 June 2024
•
Assessing the appropriateness of the accounting
treatment and disclosure in terms of AASB 6.
For personal use only
Recoverability
of
Polymetallica
Minerals
Limited (Polymetallica) loan receivable (Refer
to Note 7)
At 30 June 2024, Korab Resources Limited had
a receivable of $1,305,526 in relation to the loan
to Polymetallica.
The primary asset of Polymetallica is expenditure
on areas of interest in the exploration and
evaluation phase
We considered this to be a key audit matter due
to the material nature of the asset and the
significant audit effort directed towards this area.
Our Procedures, amongst others, included:
• Verifying the balance of the loan at 30 June 2024
to the loan confirmation from Polymetallica;
• Verifying and checking the security interests held
by Korab Resources Limited over Polymetallica
projects as security over the loan repayment.
• Assessing and considering the independent
valuation over the relevant areas of interest of
Polymetallica assets.
• Assessing the competence, experience and
independence of the valuer that performed the
valuation of Polymetallica's mineral assets;
• Checking
that
the
rights
to
tenure
for
Polymetallica areas of interest are current.
For personal use only
Note 10 - Classification of Liabilities
The operations of the Group are funded through
capital raisings and borrowings from related and
external parties.
At 30 June 2024, the Group had $4,287,773 in
borrowings representing 95% of the total
liabilities. $35,150 of the borrowings are
classified as current and $4,252,623 is classified
as non-current. Given the size of these
borrowings and the importance for continued
operations, the accounting for the Group’s
borrowings is considered a key audit matter.
Our Procedures, amongst others, included:
•
Obtaining the confirmations from the funders
confirming the borrowings at the reporting date
including the amounts and the interest rate;
•
For borrowings classified as non-current we
verified that the lender confirmed in writing that
the Group has unconditional right to defer
payments and that there were no repayments
required until at least 31 October 2025.
•
Obtaining details of the voluntary payments
made post balance sheet date and checked
that these payments were classified as current
liabilities;
•
We checked the interest calculations on the
loans and verified that the interest on the loans
was
calculated
in
accordance
with
the
contractual terms.
Information Other than the Financial Report and Auditor’s Report Thereon
The Directors are responsible for the other information. The other information comprises the information
included in the annual report for the year ended 30 June 2024 but does not include the financial report and
our auditor’s report thereon. Our opinion on the financial report does not cover the other information and
accordingly 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 this other information, we are required to report that fact.
We have nothing to report in this regard.
For personal use only
Responsibilities of the Directors for the Financial Report
The directors of the Company are responsible for the preparation of:
a. the financial report (other than the consolidated entity disclosure statement) that gives a true
and fair view in accordance with Australian Accounting Standards and the Corporations Act
2001; and
b. the consolidated entity disclosure statement that is true and correct in accordance with the
Corporations Act 2001, and
for such internal control as the directors determine is necessary to enable the preparation of:
i.
the financial report (other than the consolidated entity disclosure statement) that gives a true
and fair view and is free from material misstatement, whether due to fraud or error; and
ii.
the consolidated entity disclosure statement that is true and correct and is free of misstatement,
whether due to fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the Company 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 Company or to cease
operations, or has 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 Australian Auditing Standards will always detect a material misstatement
when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in
the aggregate, they could reasonably be expected to influence the economic decisions of users taken on
the basis of this financial report.
A further description of our responsibilities for the audit of the financial report is located at the Auditing and
Assurance Standards Board website at https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf
This description forms part of our auditor’s report.
For personal use only
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 12 to 15 of the directors’ report for the year
ended 30 June 2024.
In our opinion, the Remuneration Report of Korab Resources Limited for the year ended 30 June 2024
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.
ARMADA AUDIT & ASSURANCE PTY LTD
Nigel Dias
Director Perth, 28 October 2024
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
CORPORATE GOVERNANCE STATEMENT
52
The Board of Directors of Korab Resources Limited is responsible for corporate governance of the Company.
The Board guides and monitors the business and affairs of Korab Resources Limited on behalf of the
shareholders by whom they are elected and to whom they are accountable.
The Parent Company has neither full time nor part time employees. Most of the administration and technical
functions are outsourced to contractors who observe their own diversity and equal opportunity policies.
Subsidiaries that form the Korab Group are encouraged to seek diversification in their employment policies.
For further information on corporate governance policies adopted by Korab Resources Limited, refer to our
website: www.korabresources.com.au.
BOARD OBJECTIVES
The Board will develop strategies for the Company, review strategic objectives, and monitor the performance
against those objectives. The overall goals of the corporate governance process are to:
•
drive shareholders value;
•
assure a prudential and ethical base to the Company’s conduct and activities; and
•
ensure compliance with the Company’s legal and regulatory obligations.
Consistent with these goals, the Board assumes the following responsibilities;
•
developing initiatives for profit and assets growth;
•
reviewing the corporate, commercial and financial performance of the Company on a regular basis;
•
acting on behalf of, and being accountable to, the Shareholders;
•
identifying business risks and implementing actions to manage those risks; and
•
developing and effecting management and corporate systems to assure quality.
The Company is committed to the circulation of relevant materials to directors in a timely manner to facilitate
directors’ participation in Board discussions on a fully informed basis.
STRUCTURE OF THE BOARD
The skills, experience and expertise relevant to the position of director held by each director in office at the
date of this report is included in the Directors’ Report.
Election of Board members is substantially the province of the Shareholders in general meeting. However, the
Company commits to the following principles:
•
the Board to comprise of directors with a blend of skills, experience and attributes appropriate for the
Company and its business;
•
the principal criterion for the appointment of new directors being their ability to add value to the Company
and its business.
The Board has adopted the ASX Corporate Governance Councils definition of an independent director
contained their report titled “The Principles of Good Corporate Governance and Best Practice
Recommendations”.
The current Board structure is considered to best serve the Company in meeting its objectives, given its small
capitalisation, limited resources and existing operations. The composition of the Board is reviewed on an
annual basis to ensure that the Board has the appropriate mix of expertise and experience.
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
CORPORATE GOVERNANCE STATEMENT (Continued)
53
STATEMENT CONCERNING AVAILABILITY OF INDEPENDENT PROFESSIONAL ADVICE
If a director considers it necessary to obtain independent professional advice to properly discharge the
responsibility of his/her office as a director then, provided the director first obtains approval for incurring such
expense from the Chairman, the Company will pay the reasonable expenses associated with obtaining such
advice.
SKILLS, EXPERIENCE, EXPERTISE AND TERM OF OFFICE OF EACH DIRECTOR
A profile of each director containing the applicable information is set out in the Directors' Report.
REMUNERATION COMMITTEE AND NOMINATION COMMITTEE
At this time Korab has no remuneration or nomination committee.
NOMINATION ARRANGEMENTS
Where a vacancy is considered to exist, the board will select an appropriate candidate through consultation
with external parties and consideration of the needs of shareholders and the Company. Such appointments
will be referred to shareholders for re-election at the next annual general meeting. All directors, except the
Executive Chairman, are subject to re-election by shareholders at least every three years.
When a vacancy exists, through whatever cause, or where it is considered that the Board would benefit from
the services of a new director with particular skills, the Board will determine the selection criteria for the
position based on the skills deemed necessary for the Board to best carry out its responsibilities. The Board
will then appoint the most suitable candidate (assuming one is available) who must stand for election at the
next annual general meeting.
PERFORMANCE
During the reporting period the entity did not have a formal process for evaluation of directors and executives
due to there only being three in total. The Chairman will undertake an annual assessment of the
performance of the individual directors and meet privately with each director to discuss this assessment.
REMUNERATION ARRANGEMENTS
It is the Company’s objective to provide maximum stakeholder benefit from the retention of a high quality
board by remunerating directors fairly and appropriately with reference to relevant employment market
conditions. To assist in achieving the objective the Board intends to link the nature and amount of
executive directors’ emoluments to the Company’s financial and operational performance. The
expected outcomes of this remuneration structure will be:
•
Retention and motivation of directors and executive officers
•
Performance rewards to allow directors and executive officers to share the rewards of the success of
Korab Resources Limited
The remuneration of the Executive Chairman is decided by the non-executive directors. In determining
competitive remuneration rates the directors review local and international trends among comparative
companies and the industry generally. Directors intend to consider an employee share option plan during the
current financial year.
The maximum remuneration of non-executive directors is the subject of Shareholder resolution in accordance
with the Company’s Constitution, and the Corporations Act as applicable. The duration of non-executive
director’s remuneration within that maximum will be made by the Board having regard to the inputs and value
of the Company of the respective contributions by each non-executive director.
The Board may award additional remuneration to non-executive directors called upon to perform extra services
or make special exertions on behalf of the Company.
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
CORPORATE GOVERNANCE STATEMENT (Continued)
54
There is no scheme to provide retirement benefits, other than statutory superannuation, to non-executive
directors. All remuneration paid to directors and executives is valued at the cost to the Company and expensed.
AUDIT COMMITTEE
The shareholders in general meeting are responsible for the appointment of the external auditors of the
Company, and the Board from time to time will review the scope, performance and fees of those external
auditors. The Board has not yet established formal audit committee. It is the Board’s responsibility to ensure
that an effective internal control framework exists within the Company. This includes both internal controls to
deal with both the effectiveness and efficiency of significant business processes, the safeguarding of assets,
the maintenance of proper accounting records, and the reliability of financial and non-financial information.
IDENTIFICATION AND MANAGEMENT OF RISK
The Board’s collective experience will enable accurate identification of the principal risks which may affect the
Company’s business. Management of these risks will be discussed by the Board at periodic (at least annual)
strategic planning meetings. In addition, key operational risks and their management, will be recurring items
for deliberation at Board meetings.
ETHICAL STANDARDS
The Board is committed to the establishment and maintenance of appropriate ethical standards to underpin
the Company’s operations and corporate practices.
INDEPENDENT DIRECTORS
The independent director is Anthony Wills.
FEMALE EMPLOYEES
As at 30 June 2024 the parent company had no part time or full time employees.
As at 30 June 2024 the proportion of males and females employed by the Korab Group (including local and
overseas subsidiaries) was as follows:
Male
Female
Total
% Female
Directors
2
1
3
33.3%
Other
-
-
-
-
Total
2
1
3
33.3%
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
CORPORATE GOVERNANCE STATEMENT (Continued)
55
EXPLANATIONS FOR DEPARTURES FROM BEST PRACTICE RECOMMENDATIONS
From 1 July 2023 to 30 June 2024 (the “Reporting Period”) the Company complied with the Corporate
Governance Principles and the Recommendations as published by the ASX Corporate Governance Council
("ASX Principles and Recommendations"), other than in relation to the matters specified below:
Notification of Departure
Explanation of Departure
1.5
The Company does not have a diversity
policy
The parent Company does not have either full time or part time
employees. The contractors supplying services to the Company
observe their own diversity and equal opportunity policies. The
Board is confident that Korab Group’s recruitment practices result in
the
employment
of
the
most
suitable
candidate
without
discriminating unfairly against any potential employee on the basis
of gender, age, ethnicity, culture, or on any other basis.
2.1
A separate Nomination Committee has
not been formed.
The Board considers that the Company does not require a
Nomination Committee given the Company’s current size and
complexity and the size of the Board. The Board intends to appoint
a Nomination Committee once the Company’s size and complexity
increase.
2.2
The Company has not set out a “skills
matrix” disclosing the mix of skills that
the board currently has or is looking to
achieve in its membership
The Board considers that the Company is currently of a size and
complexity where the setting out of “skills matrix” is not necessary to
ensure that the Board is aware of the skills that the Board currently
has or is looking to achieve in its membership. If the Company’s
activities increase in size, scope and/or nature the “skills matrix” will
be set out and disclosed by the Board.
2.4
Independent directors are not majority
of the Board.
The Board considers that having majority of directors who
are substantial shareholders in the Company more effectively
aligns the interests of the Board with the interests of shareholders.
2.5
The Chairman is not an independent
director and acts in the capacity of chief
executive officer
The Board considers that the Company is currently of a size and
complexity where the Chairman can act in an executive capacity. If
the Company’s activities increase in size, scope and/or nature the
appointment of a non-executive Chairman will be considered by the
Board.
4.1
The Company does not have an Audit
Committee chaired by an independent
director who is not the Chair of the
Board
Given the size of the Board it is necessary that all board members,
including the Executive Chairman, act in the capacity of audit
committee. One of the three directors who currently comprise the
board is an independent non-executive director who is identified in
the Company’s Corporate Governance Statement.
6.3
The Company has not adopted a policy
to encourage participation at meetings
of security holders
The Board considers that shareholders currently receive both the
information and adequate notice to participate at meetings of
security holders.
7.1,
7.2
The Company does not have a Risk
Committee
The Board considers that it is of an effective composition, size, and
commitment to adequately discharge its responsibilities and duties.
Board meets regularly to discuss and review the risk management
framework but no formal review of the risk management framework
occurred during the period.
7.3
The Company does not have an internal
audit function
The Board considers that the Company is not currently of a size to
justify the formation of an internal audit function. The Board
considers that it is of an effective composition, size, and commitment
to adequately discharge its responsibilities and duties given the
Company’s size, complexity, and nature of operations. All members
of the Board meet regularly to evaluate and continually improve the
effectiveness of Company’s governance, risk management, and
internal control processes. If the Company’s activities increase in
size, scope and/or nature the internal audit function will be
developed and disclosed by the Board.
8.1
The
Company
does
not
have
Remuneration Committee
The Board considers that the Company does not require a
remuneration committee given the Company’s current size and
complexity and the size of the Board. The Board intends to appoint
a Remuneration Committee once the Company’s size and
complexity increase.
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
ADDITIONAL SHAREHOLDER INFORMATION
56
Additional information required by the ASX Limited (“ASX”) Listing Rules as at 24 October 2024 and not
disclosed elsewhere in this report is set out below.
SUBSTANTIAL SHAREHOLDERS
The following shareholders have lodged substantial shareholder notices with ASX:
Beneficial holder
Shares
%
Andrej K. Karpinski,
59,734,739
16.27
DISTRIBUTION OF SHAREHOLDERS
The distribution of security holders is as follows:
Range of holding
Shareholders
Number Of Ordinary Shares
100,001 and over
302
332,804,935
10,001 – 100,000
782
32,067,785
5,001 – 10,000
207
1,741,892
1,001 – 5,000
135
406,731
1 – 1,000
158
28,657
Totals
1,584
367,050,000
The number of shareholders holding less than a marketable parcel of ordinary shares is 912.
VOTING RIGHTS (ORDINARY SHARES)
The voting rights attaching to Ordinary Shares are governed by the Constitution. On a show of hands every
person present who is a member or representative of a member shall have one vote and on a poll, every
member present in person or by proxy or by attorney or duly authorised representative shall have one vote for
each share held. It is the policy of the Company to decide on a poll all resolutions put to a meeting. No options
have any voting rights.
SCHEDULE OF MINERAL TENEMENTS
The details of tenements and land leases held by Korab Resources Limited and controlled entities as of 24
October 2024 are as follows:
Winchester, Geolsec, and Batchelor Tenements Located in the Pine Creek Orogen in the Northern Territory
Tenement
Registered
Holder/Applicant
Status
Grant Date
Korab
Group
Share (%)
Expiry Date
Renewal
applied for
Area
(hectares)
Next
Annual
Rent
Next Year
Annual
Minimum
Expenditure
Responsible Entity
EL29550
Korab Resources Limited
Granted
1/08/2012
100%
31/07/2024
2 years
17,100
$14,500
$57,000
Korab Group
EL31341
Korab Resources Limited
Granted
28/11/2016
100%
27/11/2024
6,500
$5,600
$25,000
Korab Group
MLN512
Korab Resources Limited
Granted
19/04/1982
100%
31/12/2023
25 years
16
$650
N/A
Korab Group
MLN513
Korab Resources Limited
Granted
19/04/1982
100%
31/12/2023
25 years
16
$650
N/A
Korab Group
MLN514
Korab Resources Limited
Granted
19/04/1982
100%
31/12/2023
25 years
16
$650
N/A
Korab Group
MLN515
Korab Resources Limited
Granted
19/04/1982
100%
31/12/2023
25 years
16
$650
N/A
Korab Group
MLN542
Korab Resources Limited
Granted
19/04/1982
100%
31/12/2023
25 years
15
$630
N/A
Korab Group
MLN543
Korab Resources Limited
Granted
19/04/1982
100%
31/12/2023
25 years
15
$630
N/A
Korab Group
ML27362
Geolsec Phosphate
Granted
22/04/2010
100%
21/04/2035
234
$5,900
N/A
Korab Group
ML30587
AusMag
Granted
21/10/2015
100%
20/10/2040
349
$9,100
N/A
Korab Group
24,278
$38,960
$82,000
NT Tenements Sub-Total
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
ADDITIONAL SHAREHOLDER INFORMATION (Continued)
57
SCHEDULE OF MINERAL TENEMENTS (Continued)
Mount Elephant Tenements Located in Ashburton Mineral Field in Western Australia
Bobrikovo Tenements Located in the Luhansk Region in Eastern Ukraine
*On 24 September 2019, the Company reported that it has received notification that on the basis of the Presidential
Executive Order/Decree, all exploration licences, mining permits, and leases held by LLC “Donetsky Kryazh” whose term
would have otherwise expired, have been prolonged until the end of the hostilities in the Luhansk region.
The consolidated entity has obligations to perform minimum exploration work and to meet annual payments in
respect of rent on granted tenements. These obligations may be varied from time to time subject to approval
and on this basis they are expected to be fulfilled in the normal course of operations. The Company can also
meet its expenditure obligations by seeking joint venture partners, or by causing other parties to expend funds
on exploration or mining, or by way of sale of all or part of an interest in a tenement, or by allowing tenements
to lapse. Expenditure requirements for applications pending approval are not included.
ON-MARKET BUYBACK
There is no current on-market buyback.
Tenement
Registered
Holder/Applicant
Status
Grant Date
Korab
Group
Share (%)
Expiry /
Surrender
Date
Area
(blocks)
Next
Annual
Rent
Next Year
Annual
Minimum
Expenditure
Responsible Entity
E 08/2756
Australian Copper
Surrendered
9/09/2016
100%
23/04/2024
10
NIL
NIL
Australian Copper
E 08/2757
Australian Copper
Surrendered 23/02/2017
100%
28/06/2024
5
NIL
NIL
Australian Copper
E 52/2724
Australian Copper Holdings
Surrendered 18/07/2013
100%
14/07/2023
42
NIL
NIL
Australian Copper Holdings
E 08/2307
Australian Copper Holdings
Surrendered 23/08/2013
100%
14/07/2023
25
NIL
NIL
Australian Copper Holdings
E 08/3561
Korab Resources Limited
Application
N/A
100%
N/A
199
N/A
N/A
Korab Resources Limited
E 52/4223
Korab Resources Limited
Application
N/A
100%
N/A
171
N/A
N/A
Korab Resources Limited
452
$0
$0
WA Tenements Sub-Total
Tenement
Registered
Holder/Applicant
Status
Grant Date
Korab
Group
Share
Expiry Date
Area
(hectares)
Next
Annual
Rent
Next Year
Annual
Minimum
Expenditure
BKB169
LLC "Donetsky Kryazh"
Granted
30/10/2007
100%
30/10/2037
25
N/A
N/A
4420381100
LLC "Donetsky Kryazh"
Granted
29/07/2009
100%
17/07/2018**
8
N/A
N/A
1589
LLC "Donetsky Kryazh"
Granted
29/07/2009
100%
17/06/2018**
13
N/A
N/A
2730
LLC "Donetsky Kryazh"
Granted
17/06/2002
100%
17/06/2018**
12
N/A
N/A
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
ADDITIONAL SHAREHOLDER INFORMATION (Continued)
58
TWENTY LARGEST SHAREHOLDERS
The names of the twenty largest shareholders are as follows:
Rank
Name
24 October 2024
%
1
RHEINGOLD INVESTMENTS CORPORATION PTY LTD
59,700,000
16.26
2
MR JOHN MORTON HATRICK
18,350,000
5.00
3
RIADIS HOLDINGS PTY LTD
18,000,000
4.90
4
CUSTODIAL SERVICES LIMITED
10,426,421
2.84
5
CHANCERY HOLDINGS PTY LTD
10,400,000
2.83
6
VECTOR NOMINEES PTY LTD
7,980,889
2.17
7
SERGIY ANTONENKO
7,500,000
2.04
8
MR JIHAD MALAEB
7,100,000
1.93
9
SELWYN BRUCE HATRICK
6,800,152
1.85
10
M & K KORKIDAS PTY LTD
6,405,738
1.75
11
MR ANTONINO DI FRANCESCO
6,181,000
1.68
12
MR XI YU ZHANG
6,010,000
1.64
13
MR GARY WILLIAM LITTLE
5,913,232
1.61
14
MR SCOTT GILCHRIST
5,815,143
1.58
15
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
5,456,204
1.49
16
MR ANDREW GORDON MCCREA
4,410,063
1.20
17
MR PETER MAC GARWOOD
4,357,177
1.19
18
MR CRAIG ANDREW JOHNSON
4,275,000
1.16
19
SHARESIES AUSTRALIA NOMINEE PTY LIMITED
4,012,950
1.09
20
FINCLEAR SERVICES PTY LTD
3,463,041
0.94
Total
202,557,010
55.19
Balance of register
164,492,990
44.81
Grand total
367,050,000
100.00
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
ADDITIONAL SHAREHOLDER INFORMATION (Continued)
59
MINERAL RESOURCE ESTIMATES
Korab Resources Ltd holds two projects where mineral resources have been estimated: Winchester Project
and Bobrikovo Project. Korab reviews its mineral resources annually utilising outside consultants, who have
in excess of 5 years’ experience which is relevant to the style of mineralisation and type of deposit under
consideration and to the activity which they are undertaking and which is sufficient to qualify them as a
Competent Person as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration
Results, Mineral Resources and Ore Reserves’.
Winchester Deposit within the Winchester Project in the Northern Territory
Current estimate of mineral resource at Winchester is shown in the following table:
At 40% MgO Cut-Off
Mass
MgO grade
MgO Mass
‘000 Tonnes
%
‘000 Tonnes
Indicated
12,200
43.1
5,258
Inferred
4,400
43.6
1,918
Total
16,600
43.2
7,177
There has been no change to the Winchester mineral resource estimate since previous year.
The Competent Person is not aware of any new information or data that materially affects the information
included in the Company’s ASX Release - “Acquisition Of The Rum Jungle/Batchelor Project In Northern
Territory” on 16 July 2007 and, in the case of mineral resources that all the material assumptions and technical
parameters underpinning the estimates in the report released on 16 July 2007 continue to apply and have not
materially changed. The form and context in which the findings of the report released on 16 July 2007 are
presented have not been materially modified. This information was prepared and first disclosed under the
JORC Code 2004. It has not been updated since to comply with the JORC Code 2012 on the basis that the
information has not materially changed since it was last reported.
Winchester project consists of Mineral Lease ML30587 (100% AusMag Pty Ltd, a wholly owned subsidiary of
Korab Resources Ltd). The project is located near town of Batchelor, some 70 km south of Darwin in the
Northern Territory. The Company is confident that there are reasonable prospects for eventual economic
extraction of the mineral resource.
Competent Person Statement
The information in this Annual Report that relates to Exploration Targets, Exploration Results, Mineral
Resources or Ore Reserves is based on information compiled by the Company and reviewed by Malcolm
Castle, a competent person who is a Member of the Australasian Institute of Mining and Metallurgy (“AusIMM”).
Malcolm Castle is a consultant geologist employed by Agricola Mining Consultants Pty Ltd. Mr Castle has
sufficient experience that is relevant to the style of mineralization and type of deposits under consideration and
to the activity being undertaken to qualify as a Competent Person as defined in the 2012 edition of the
“Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves” (“JORC
Code”). Malcolm Castle consents to the inclusion in this Annual Report of the matters based on his information
in the form and context in which it appears.
Bobrikovo Deposit in Ukraine
Current estimate of gold and silver mineral resource at Bobrikovo is shown in the following tables:
CURRENT GOLD MINERAL RESOURCE AT BOBRIKOVO PROJECT (ABOVE 0.5 G/T AU CUT-OFF GRADE)
At 0.5g/t Au Cut-Off
Mass
Au grade
Au Mass
‘000 Tonnes
g/t
‘000 Ounces
Measured
2,317
1.6
121
Indicated
5,194
1.4
229
Inferred
98,404
0.9
2,953
Total
105,916
1.0
3,303
Totals may differ due to rounding
For personal use only
KORAB RESOURCES LIMITED
ANNUAL REPORT 2024
& CONTROLLED ENTITIES
ADDITIONAL SHAREHOLDER INFORMATION (Continued)
60
MINERAL RESOURCE ESTIMATES (Continued)
CURRENT SILVER MINERAL RESOURCE AT BOBRIKOVO PROJECT (ABOVE 5 G/T AG CUT-OFF GRADE)
At 5g/t Ag Cut-Off
Mass
Ag grade
Ag Mass
‘000 Tonnes
g/t
‘000 Ounces
Measured
2,090
14.0
937
Indicated
5,529
13.9
2,467
Inferred
46,533
8.6
12,869
Total
54,152
9.4
16,274
Totals may differ due to rounding
There has been no change to the Bobrikovo mineral resource estimate since previous year.
The Bobrikovo Mineral Resource was first disclosed on 16 July 2013 and is based on information compiled
and reviewed by Andrew Hawker, who is a principal geological consultant for HGS Australia Exploration
Services.
The Competent Person is not aware of any new information or data that materially affects the information first
included in the Company’s ASX Release – “JORC Resource At Bobrikovo Estimated At 3.3 Million Oz. Au And
16.3 Million Oz. Ag” on 16 July 2013 and, in the case of mineral resources that all the material assumptions
and technical parameters underpinning the estimates in the report released on 16 July 2013 continue to apply
and have not materially changed. The form and context in which the findings of the report released on 16 July
2013 are presented have not been materially modified. This information was prepared and first disclosed under
the JORC Code 2004. It has not been updated since to comply with the JORC Code 2012 on the basis that
the information has not materially changed since it was last reported.
Bobrikovo project consists of tenements and land leases BKB169, 646545, 2730, 4101 (100% LLc “Donetsky
Kryazh”, a wholly owned subsidiary) and is located 70km south of Luhansk in Ukraine.
Bobrikovo Project is located in eastern part of Ukraine in the Donbas region. This project has been written-off
in full at the consolidation level in Financial Report covering period ending 30 June 2014. For expiry dates of
the tenements forming this project and relevant comments regarding extension of term please refer to the
Schedule of Mineral Tenements on page 61. The Company is confident that there are reasonable prospects
for eventual economic extraction of the mineral resource.
Competent Person Statement
The information in this Annual Report that relates to Exploration Targets, Exploration Results, Mineral
Resources or Ore Reserves is based on information compiled by the Company and reviewed by Malcolm
Castle, a competent person who is a Member of the Australasian Institute of Mining and Metallurgy (“AusIMM”).
Malcolm Castle is a consultant geologist employed by Agricola Mining Consultants Pty Ltd. Mr Castle has
sufficient experience that is relevant to the style of mineralization and type of deposits under consideration and
to the activity being undertaken to qualify as a Competent Person as defined in the 2012 edition of the
“Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves” (“JORC
Code”). Malcolm Castle consents to the inclusion in this Annual Report of the matters based on his information
in the form and context in which it appears.
For personal use only