C U L L E N
R E S O U R C E S L I M I T E D
A N N U A L R E P O R T
2 0 1 3
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Cullen Resources Limited
CORPORATE DIRECTORY
CONTENTS
Chairman's Report
Company Profile
Highlights
Exploration Review
Directors' Report
Corporate Governance Statement
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Comprehensive Income
Consolidated Statement of Cash Flows
Notes to the Financial Statements
Directors' Declaration
Independent Audit Report
Shareholder Information
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3
4
5
17
26
29
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31
32
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60
61
63
ABN: 46 006 045 790
Directors
Denis Clarke (Non-executive Chairman)
Chris Ringrose (Managing Director)
John Horsburgh (Non-executive)
Grahame Hamilton (Non-executive)
Wayne Kernaghan (Non-executive)
Secretary
Wayne Kernaghan
Registered and Principal Office
Unit 4
7 Hardy Street
South Perth WA 6151
Telephone +61 (8) 9474 5511
Facsimile +61 (8) 9474 5588
Auditors
Ernst & Young
11 Mounts Bay Road
Perth WA 6000
Solicitors
Lavan Legal
1 William Street
Perth WA 6000
Bankers
Westpac
Sydney NSW 2000
Securities Quoted
Australian Securities Exchange
Home Exchange - Sydney
ASX Code: CUL
Share Registry
Computershare Investor
Services
Level 3, 60 Carrington Street
Sydney NSW 2000
Telephone (02) 8234 5000
www.computershare.com
Email
cullen@cullenresources.com.au
Company Website
www.cullenresources.com.au
Chairman’s Report
2
DEAR FELLOW SHAREHOLDER
Cullen is a discovery-driven company exploring in a number of prospective terranes: in areas
where exploration activity is high, where new discoveries are being made, and in commodities
of interest to the market.
Our strategy is to seek out multiple opportunities in several commodities, in order to fully exploit
our in-house geological experience, and spread risk. We have adopted this strategy both here
in Australia, and in other countries with accessible geological databases, good fundamental
prospectivity and terranes where limited previous exploration has been completed. These pre-
conditions offer the best opportunities for us to make a discovery. Such project generation
activities in “greenfields” is a key strategy of Cullen's, and we have been successful in
developing an excellent portfolio of prospective projects for our exploration, or for attracting
joint venture partners.
In what has been a very difficult year for junior explorers, capital management has been a key
consideration. Despite this, Cullen has maintained its position as a project generator,
undertaken its own exploration, and is “free carried “, albeit with a minority equity position , in a
number of active Joint Ventures. Cash conservation has led to a slowing of activities in Finland
and on the TL Property in Canada, but the company maintains a watching-brief for
opportunities and is seeking Joint Venture partners to maintain momentum in some of its
projects.
The Company also remains a participant in a potential, major, new iron ore development project
in the West Pilbara Region of Western Australia, the West Pilbara Iron Ore Project (WPIOP).
As a co-venturer in the Mt Stuart Iron Ore Joint Venture (MSIOJV), Cullen has been contributing
funds in anticipation that, in the future, funding and required approvals will be available to allow
the development of port and rail infrastructure as planned by the APIJV (Manager of the
MSIOJV). However at this time, activities on the MSIOJV the WPIOP have slowed.
I thank all shareholders for their continued interest and support, and our small but effective
team of staff in Perth, my fellow directors, and our consultants and contractors for their
contributions.
Dr. Denis Clarke, Chairman
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Company Profile
Company Profile
4
Perth-based minerals explorer with:
- iron ore Reserve
- multi-commodity portfolio
- multiple JV partnerships
- active programmes
- innovative approaches
- motivated management
- experienced board
- project generation in Namibia and Scandinavia
West Pilbara JV
Hardey Junction JV
Lake Mackay
Wyloo JV
Paraburdoo JV
Kunderong JV
Amadeus
Mt Eureka
Cue
Killaloe JV
Perth
Forrestania JV
Minter
Uranium
Gold
Tungsten
Nickel
Iron
Copper, gold
SCANDINAVIA:
Iron Ore, IOCG,
Gold, Graphite
NAMIBIA:
Copper, REE
BC, CANADA:
Base Metals,
Graphite
AUSTRALIA
Highlights
Highlights
2012/2013
MT EUREKA, WA
NICKEL & GOLD
2
650m project area in North Eastern Goldfields - prospective for gold and
nickel. VTEM survey completed, ground EM follow-up and four targets drill
tested to date. Nineteen nickel targets defined for further exploration.
MURCHISON, WA
GOLD & BASE METALS
Project area approximately 30km east of Cue, covering the northern part
of the Tuckabianna – Webbs Patch greenstone sequence. Exploration
targets for gold and VMS-style base metal mineralisation in this
underexplored area. Some EM anomalies drilled, others remain untested.
BRITISH COLUMBIA
ZINC
HeliTEM survey flown centred on high-grade, greenfields zinc
mineralisation at the “TL Property” where trenching exposed +10m wide
sulphide mineralization with best channel sample of 3m @ 8.98% Zn. First
pass drilling completed; best 2m @ 2.66% Zn for follow-up.
LACHLAN , NSW
TUNGSTEN
Diamond drilling completed at Minter in July 2012 tested for cupola-
Interpretation of vein orientation
related, tungsten-bearing vein system.
indicates further drilling required to more correctly evaluate.
CATHO WELL, WA
IRON
Mineral Resource Estimate for the Catho Well Channel Iron Deposit of
98Mt @ 55.0 % Fe and a Maiden JORC Reserve Estimate of 70Mt @
54.8% Fe (Cullen 30%) awaits broader project infrastructure solution.
WYLOO, WA
IRON
Maiden Inferred Resource of Bedded Iron of 16.9Mt @ 57.11% Fe (Cullen
20%) further work in 2013/2014 planned by JV Manager, Fortescue Metals
Group.
SCANDINAVIA
IRON, GOLD & COPPER
GRAPHITE
Tenure in Sweden near Kiruna (iron and copper) and in Finland near
Kuusamo (gold), and Rompas (gold) discoveries, being assessed and
prioritised.
NAMIBIA
COPPER
Two Exclusive Prospecting Licences in Namibia near Tsumeb have been
retained for further review.
4
Highlights
Highlights
2012/2013
MT EUREKA, WA
NICKEL & GOLD
2
650m project area in North Eastern Goldfields - prospective for gold and
nickel. VTEM survey completed, ground EM follow-up and four targets drill
tested to date. Nineteen nickel targets defined for further exploration.
MURCHISON, WA
GOLD & BASE METALS
Project area approximately 30km east of Cue, covering the northern part
of the Tuckabianna – Webbs Patch greenstone sequence. Exploration
targets for gold and VMS-style base metal mineralisation in this
underexplored area. Some EM anomalies drilled, others remain untested.
BRITISH COLUMBIA
ZINC
HeliTEM survey flown centred on high-grade, greenfields zinc
mineralisation at the “TL Property” where trenching exposed +10m wide
sulphide mineralization with best channel sample of 3m @ 8.98% Zn. First
pass drilling completed; best 2m @ 2.66% Zn for follow-up.
LACHLAN , NSW
TUNGSTEN
Diamond drilling completed at Minter in July 2012 tested for cupola-
related, tungsten-bearing vein system. Interpretation of vein orientation
indicates further drilling required to more correctly evaluate.
CATHO WELL, WA
IRON
Mineral Resource Estimate for the Catho Well Channel Iron Deposit of
98Mt @ 55.0 % Fe and a Maiden JORC Reserve Estimate of 70Mt @
54.8% Fe (Cullen 30%) awaits broader project infrastructure solution.
WYLOO, WA
IRON
Maiden Inferred Resource of Bedded Iron of 16.9Mt @ 57.11% Fe (Cullen
20%) further work in 2013/2014 planned by JV Manager, Fortescue Metals
Group.
SCANDINAVIA
IRON, GOLD & COPPER
GRAPHITE
Tenure in Sweden near Kiruna (iron and copper) and in Finland near
Kuusamo (gold), and Rompas (gold) discoveries, being assessed and
prioritised.
NAMIBIA
COPPER
Two Exclusive Prospecting Licences in Namibia near Tsumeb have been
retained for further review.
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Exploration Review
Australia
Australia
ASHBURTON/PILBARA, WA
WEST PILBARA MT STUART JV - IRON
The Mt Stuart Iron Ore Joint Venture (MSIOJV) is between Cullen - 30%, and the unincorporated joint venture known
as the Australian Premium Iron Joint Venture (APIJV) - 70%. The APIJV comprises Aquila Steel Pty Ltd (a subsidiary
of Aquila Resources Limited (Aquila, ASX: AQA)) 50%, and AMCI (IO) Pty Ltd 50%. In July 2010, Aquila reported the
results of a Feasibility Study (FS) for the APIJV’s proposed 30Mtpa West Pilbara Iron Ore Project (WPIOP) - Stage 1
indicating technical viability.
The Catho Well deposit (MSIOJV) is a potential ore component of the WPIOP. Under one scenario, ore derived from
the Catho Well deposit would contribute to the main, blended product stream maintaining an average 57.2% Fe
throughout the proposed 15 year mine life of the WPIOP - Stage 1 mining operations.
During 2012-2013, work to progress the WPIOP from the Feasibility to Development stage was slowed. At present
no definitive schedule for the proposed WPIOP rail and port infrastructure exists.
Work by the MSIOJV during the year included: maintaining the tenements in good standing, completing heritage
surveys in relation to Catho well and progressing negotiations towards Native Title Agreements for the granting of
two Mining Lease applications made in October 2011 (Catho Well and Cardo Bore).
MINERAL RESOURCE ESTIMATE CATHO WELL CHANNEL IRON DEPOSIT: (CULLEN 30%)
Joint
Venture
Mt Stuart
JV
JORC
Classification
Measured
Indicated
Inferred
TOTAL
Mt
2
73
23
98
Fe
%
P
%
SiO2
%
AI O2 3
%
S
%
Mn
%
MgO
%
LOI
%
55.1
0.041
6.61
3.64
0.020
0.058
0.208
9.99
55.1
0.037
6.91
3.16
0.016
54.6
0.037
7.53
3.10
0.015
0.079
0.102
0.178
0.209
10.26
10.40
55.0
0.037
7.05
3.15
0.016
0.084
0.186
10.29
The Catho Well Mineral Resource estimate is reported at a 53% Fe cut-off. The resource estimate has been compiled in accordance with the
guidelines defined in the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (The JORC Code, 2004
Edition).
Competent Persons Statement Resource
The information in this announcement that relates to Mineral Resources has been supervised by Mr Stuart Tuckey and Mr Richard Gaze who are
members of the Australian Institute of Mining and Metallurgy. Mr Tuckey is a full-time employee of API Management Pty Ltd. Mr Gaze is a full time
employee of Golder Associates Pty Ltd. Messrs Tuckey and Gaze have sufficient experience which is relevant to the style of mineralisation and type of
deposit under consideration and to the activity which they are undertaking to qualify as Competent Persons as defined in the 2004 Edition of the
'Australasian Code of Reporting of Exploration Results, Mineral Resources and Ore Reserves'. Mr Tuckey and Mr Gaze consent to the inclusion in
the report of the matters based on their information in the form and context in which it appears.
Competent Persons Statement Reserve
The information in this release that relates to Ore Reserves is based on information compiled by Mr Steve Craig, Managing Director of ORElogy
(Mining Consultants). Mr Craig is a Member of the Australasian Institute of Mining and Metallurgy and has sufficient experience which is relevant to
the style of mineralisation and type of deposit under consideration, and to the activity he is undertaking, to qualify as a Competent Person as defined in
the 2004 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Mr Craig consents to the
inclusion of the matters based on his information in the form and context in which it appears in this release.
Exploration Review
6
MT STUART JOINT VENTURE (MSIOJV) ORE RESERVE ESTIMATE (CULLEN 30%)
Product
Category
Product 1
Proved
Probable
Total
Tonnes
Mt
1
69
70
Fe
%
55.28
54.80
54.81
AI O2 3
%
3.33
3.23
3.23
SiO2
%
6.57
7.23
7.22
P
%
0.043
0.037
0.037
LOI
%
10.03
10.31
10.30
TUNNEL CREEK JV - URANIUM
The Company has a Joint Venture agreement with Element 92 Pty Ltd, a wholly-owned subsidiary of Thundelarra
Exploration Ltd (Thundelarra), over its two tenements (ELs 52/1890, 1892) at Tunnel Creek/Kunderong, in the
Ashburton Province. In 2011, U3O8 Limited (U3O8) and Thundelarra agreed for U3O8 to farm–in and take over
management of these EL’s in this Cullen/Thundelarra JV. U3O8 and Thundelarra can together earn 70%, with
Cullen to retain 30%, in what is now called the Saltwater Pool JV. In 2012, U3O8 changed its name to Avocet, and
during 2012-2013 merged with Lion One Metals Ltd (ASX: LLO).
Avocet Resources completed an RC drilling programme (11 holes for 1050m) in July 2013 to test the down dip
extensions of surface high-grade gold and silver assays returned from regional sampling. The regional structure
hosting the Monster project has previously had no exploration undertaken along its length. Avocet identified the
mineralisation during a helicopter-supported regional assessment of low- to high- order radiometric anomalies
throughout its Ashburton project area. Sampling of the quartz vein system in the regional shear zone that transects
graphitic black shale in the Proterozoic Wyloo basement complex, returned gold assays to 13g/t, and silver assays to
1660g/t, with anomalous base metals.
Most holes intersected sheared graphitic black shales, with variable amounts of quartz veining and sulphides.
Samples have been despatched for analysis of a suite of elements including precious and base metals, with results
pending at this time.
HARDEY JUNCTION JV - GOLD
Intrepid Mines Limited sold the Paulsens Gold Mine, located approximately 15km north of the Hardey Junction JV
ground, to Northern Star Resources Ltd in a deal which included sale of their beneficial interest in the Hardey
Junction JV. Cullen holds a 20% Free Carried Interest to decision to mine based on a Bankable Feasibility study in
this Joint Venture. Northern Star Resources has completed first pass soil sampling that defined several geochemical
anomalies over prospective geological targets. Infill soil sampling and auger drilling has also been completed, in
order to better define targets for follow-up drilling.
Catho Well - Channel Iron Deposit
7
Exploration Review
WYLOO AND PARABURDOO JVs - IRON
The Wyloo Project lies within Fortescue Metals Group Ltd’s (Fortescue) proposed “Western Hub” mining centre, and
just south of Cullen's 30%-owned Catho Well Channel Iron Deposit which is part of the West Pilbara Iron Ore Project
– Stage 1. Fortescue can earn up to an 80% interest in the iron ore rights on EL08/1393 and ELs 47/1154, 1649 and
1650. Fortescue has provided a maiden Resource Estimate of 16.9Mt @ 57.11% Fe in a Bedded Iron Deposit at
Wyloo South, in the Inferred category, and has thereby earned 51%.
Fortescue can earn up to an 80% interest in the iron ore rights on Cullen's EL52/1667, located ~ 25km south east of
Paraburdoo in the Pilbara Region of Western Australia. The tenement includes potential for bedded iron deposits
within the Brockman Iron Formations, along strike from the Paraburdoo and Channar Groups of iron deposits.
Fortescue completed a 26 hole RC drilling programme for 2150m with a best intersection of 5m @ 55.36% Fe with
follow-up drilling planned.
I n d i a n O c e a n
Port Hedland
API JV's proposed
railway and port
Dampier
Pannawonica
ANKETELL
POINT
Fortescue's
Western Hub
Marble Bar
Solomon
Mt MacLeod
MT STUART JV
CATHO WELL CID
Tom Price
Hardey
Paraburdoo
Channar
WYLOO JV
Cullen/Fortescue
PARABURDOO JV
Cullen/Fortescue
Cloudbreak
Christmas Creek
Nyudunghu
N
50 kilometres
Newman
Mt Whaleback
Iron ore deposits
Existing railway
Proposed Solomon railway (Fortescue - 23/3/11)
Fortescue iron ore deposit
Existing Fortescue railway
Proposed Central Pilbara railway (Fortescue - 23/3/11)
Proposed railway (APIJV)
Competent Persons Statement – Wyloo JV - Resource
Mr. Stuart Robinson is a full-time employee of Fortescue Metals Group Ltd and Mr. Glassock recently resigned from the company. Both people
provided geological interpretations for Mineral Resource calculations and compiled the exploration results. Mr. Robinson, who is a Fellow of The
Australian Institute of Mining and Metallurgy, and Mr. Glassock, who is a Member of The Australian Institute of Mining and Metallurgy have sufficient
experience which is relevant to the style of mineralization and type of deposit under consideration and the activity which they are undertaking to
qualify as a Competent Person as defined in the 2004 Edition of the “Australian Code for Reporting of Exploration Results, Mineral Resources and
Ore Reserves”.
Mr. Robinson and Mr. Glassock consent to the inclusion in this report of the matters based on this information and in the form and context in which it
appears.
Exploration Review
8
Australia
NORTH WEST YILGARN, WA
NORTH TUCKABIANNA - GOLD AND BASE METALS
The felsic Eelya Complex hosts the high-grade Hollandaire copper discovery of Silver Lake Resources Ltd (ASX:
SLR – 10 November 2011) as well as several other EM conductor targets, explored by Silver Lake Resources Ltd,
including the Colonel and Mt Eelya prospects .
In April 2012, Cullen completed 7 holes, ~1000m, of scout RC drilling at its North Tuckabianna copper/gold project
which targeted three conductors (NT1-NT3) identified by a helicopter-borne EM survey (VTEM,100-200m line
spacing). The VTEM survey was flown across the Eelya Complex and the northern section of the Tuckabianna
greenstone belt in March 2012.
This drilling intersected disseminated sulphide (mainly pyrite and pyrrhotite, 1-20% visually identified over intervals
of 1-20m downhole) in mafic and felsic rocks at or near the modelled conductor plates from the VTEM survey in all
holes drilled. The drill sample assays include a best result of 0.19% Cu and 0.21% Zn from 62-64m depth in drill hole
TNRC14 at the target NT3. The best gold result is 0.12g/t from 66-68m in drill hole TNRC11 at target Nt2.
However, downhole surveys completed at each VTEM anomaly redefined the position of the conductor plates and
showed that the conductive targets had been narrowly missed by the first pass drilling and therefore had not been
adequately tested.
These redefined conductor plates were tested in August 2012 with four RC holes (TNRC15-18) and intersected
zones of disseminated sulphide but with only geochemically anomalous assay results (maximum Cu - 0.20%).
Several low-order VTEM anomalies remain to be investigated and tested, initially using A/C and/or RAB drilling.
EASTERN GOLDFIELDS, WA
.
FORRESTANIA - GOLD AND NICKEL
Cullen holds a 20% Free Carried Interest in the western portion of Hannans Reward Limited (Hannans)
Stormbreaker Prospect, centred ~12km north of the Flying Fox Nickel Mine in the Forrestania Greenstone Belt in
Western Australia.
Hannans has indicated its intention to divest its interest in this project together with its other nickel exploration
assets.
KILLALOE - GOLD AND NICKEL
Cullen and Matsa Resources Limited (Matsa) signed an agreement to allow Matsa to farm-in to Cullen's Killaloe
Project near Norseman in W.A. (EL63/1018, EL63/1199 and PL’s 63/1331-1333 and 1672). Matsa has earned a 70%
interest in the Killaloe Project and Cullen has exercised its option to convert its 30% participating interest into a 20%
Free Carried Interest (FCI) to a Decision to Mine.
Matsa has completed soil sampling, rock chip sampling and a review of past nickel exploration reports and
exploration data including ground EM. This has led to a plan to undertake RC drilling, further ground EM and infill
ground EM surveys targeting nickel sulphide deposits. Matsa also plans to RC drill test two gold targets.
9
Exploration Review
Australia
NORTH EASTERN GOLDFIELDS, WA
MT EUREKA - GOLD, NICKEL
2
Cullen holds 100% of ~650km of approved tenure in the Mt Eureka Greenstone Belt in the North Eastern
Goldfields of Western Australia which includes several targets for nickel sulphides. The high nickel
prospectivity of Cullen's ground is confirmed by the discovery of nickel sulphides by Rox Resources Limited
(Rox) at Camelwood (Fisher East Project) which is located ~3km on strike to the south of Cullen's tenement
boundary (ASX releases by Rox, ASX: RXL, of 19/12/2012 and 14/1/2013).
Cullen has been progressively reviewing its extensive database, and has undertaken field assessments of the nickel
and gold prospectivity of it's Mt Eureka greenstone belt project. Regional data and models for other minerals
discoveries, such as “Rosie” – nickel, and “Garden Well” - gold, in the Duketon greenstone belt, have been taking
into consideration when identifying priority target areas for drilling.
During the year, Cullen completed a moving loop, ground electromagnetic survey (MLTEM) which confirmed and
upgraded several high-quality conductors identified by Cullen's extensive airborne EM (VTEM) survey completed in
March, 2013. Interpretation and modellings of the MLTEM anomalies, in combination with geochemical data, has
outlined 19 target areas for nickel sulphide exploration, four of which were drill tested in a first pass in July 2013 (4
RC holes for 730m).
Of the remaining 15 targets for massive nickel sulphide deposits, some were drill-tested by WMC/BHPB Limited in
joint venture with Cullen in 2002-2006, generally by 1 or 2 diamond drill holes. However, several targets have
received very limited follow-up, with no ground EM and/or deeper drill testing. These targets include unresolved
down hole EM (DHEM) and/or ground EM anomalies, as well as geochemical and lithological targets along strike of
known mineralisation. Cullen will continue fieldwork and database review to identify the priorities for drill testing.
One of the best targets is Doyles Prospect, where previous percussion drilling has intersected nickel concentrations
greater than 0.4% over 400m strike length, with intervals up to 0.9% nickel.
Gold exploration review by Cullen during the year culminated in the restart of exploration drilling with a single hole
completed (July, 2013) at the Southern prospect which indicated extensive hydrothermal alteration (pyrite,
arsenopyrite, carbonate) with a best intersection of 8m @ 1.71g/t Au from 184m. This is part of an extensive gold
mineralisation zone, which warrants further evaluation and drilling at depth below total oxidation.
Other targets for further work include:
The northern and southern extensions of the Eureka North West mineralisation, where previous intersections of
gold in conglomerate include 8m @ 2.92 g/t Au. The conglomerate is interpreted to continue for some 10km to the
north under lake cover and has not been tested by systematic drilling to date.
The northern and southern extension of the Taipan shear zone - the Taipan target area has a best drill intercept of
22m @ 2.1 g/t Au, including 6m @ 5.0 g/t Au. It is a robust mineralised system of quartz veining, pyrite and carbonate
alteration hosted by sheared mafic schists over a strike length of 700m and up to 100m wide (91m @ 0.3 g/t Au in
"DDH1" from 133m) and open to the north and south.
9
10
Exploration Review
Exploration Review
Australia
Australia
Australia
NORTH EASTERN GOLDFIELDS, WA
MT EUREKA - GOLD, NICKEL
2
Cullen holds 100% of ~650km of approved tenure in the Mt Eureka Greenstone Belt in the North Eastern
Goldfields of Western Australia which includes several targets for nickel sulphides. The high nickel
prospectivity of Cullen's ground is confirmed by the discovery of nickel sulphides by Rox Resources Limited
(Rox) at Camelwood (Fisher East Project) which is located ~3km on strike to the south of Cullen's tenement
boundary (ASX releases by Rox, ASX: RXL, of 19/12/2012 and 14/1/2013).
Cullen has been progressively reviewing the extensive database, and has undertaken field assessments of the
nickel and gold prospectivity of it's Mt Eureka greenstone belt project. Regional data and models for other minerals
discoveries, such as “Rosie” – nickel, and “Garden Well” - gold, in the Duketon greenstone belt, have been taking
into consideration when identifying priority target areas for drilling at Gunbarrel as follows.
During the year, Cullen completed a moving loop, ground electromagnetic survey (MLTEM) which confirmed and
upgraded several high-quality conductors identified by Cullen's extensive airborne EM (VTEM) survey completed in
March, 2013. Interpretation and modeling of the MLTEM anomalies, in combination with geochemical data, has
outlined 19 target areas for nickel sulphide exploration, four of which were drill tested in July 2013 ( 4 RC holes for
730m).
Of the remaining 15 targets for massive nickel sulphide deposits, some were drill-tested by WMC/BHPB Limited in
joint venture with Cullen in 2002-2006, generally by 1 or 2 diamond drill holes. However, several targets have
received very limited follow-up, with no ground EM and/or deeper drill testing. These targets include unresolved
down hole EM (DHEM) and/or ground EM anomalies, as well as geochemical and lithological targets along strike of
known mineralisation. Cullen will continue fieldwork and database review to identify the priorities for drill testing.
One of the best targets is Doyles Prospect, where previous percussion drilling has intersected nickel concentrations
greater than 0.4% over 400m strike length, with intervals up to 0.9% nickel.
Gold exploration by Cullen during the year has included a single hole (July, 2013) at the Southern prospect and
review of other targets, including:
(cid:2) The northern and southern extensions of the Eureka North West mineralization, where previous intersections of
gold in conglomerate include 8m @ 2.92 g/t Au. The conglomerate is interpreted to continue for some 10km to the
north under lake cover and has not been tested by systematic drilling to date.
(cid:2) The northern and southern extension of the Taipan shear zone - the Taipan target area has a best drill intercept of
22m @ 2.1 g/t Au, including 6m @ 5.0 g/t Au. It is a robust mineralised system of quartz veining, pyrite and carbonate
alteration hosted by sheared mafic schists over a strike length of 700m and up to 100m wide (91m @ 0.3 g/t Au in
"DDH1" from 133m) and open to the north and south.
RC drilling at Southern Prospect indicated extensive hydrothermal alteration (pyrite, arsenopyrite, carbonate) with a
best intersection of 8m @ 1.71g/t Au from 184m. This is part of an extensive gold mineralisation zone, which
warrants further evaluation and drilling at depth below total oxidation.
Wiluna
Mt Keith
Cliffs
Yakabindie
Cosmos
Horse Well
Jundee
P
r
o
t
e
r
o
z
o
i
c
MT EUREKA
Mt Fisher
Camelwood
Collurabbie
Mt Mcclure
Bronzewing
Melrose
Rosie
Perserverance
Darlot
Waterloo
Yi l g a r n C r a t o n
( A r c h e a n )
Moolart
Well
Garden
Well
Mt Windarra
Laverton
N
40 kilometres
Leonora
Granitoid rocks
Greenstone belt
Sediments
Ultramafics
/
Nickel / Gold occurence
and prospects
Road, town
Cullen tenement
11
Exploration Review
Australia
CENTRAL LACHLAN FOLD BELT, NSW
MINTER - TUNGSTEN
A combined RC percussion-diamond drilling programme totalling 536.8 metres in three holes was undertaken on the
Minter project in June/July 2012 testing selected geological/geochemical targets at the Doyenwae and Orr Trig
prospects. Holes were designed to test beneath zones of anomalous tungsten and tin geochemistry outlined by
earlier soil sampling and shallow percussion/aircore/RAB drilling.
At the Doyenwae Prospect, RC percussion hole MRC005 averaged 0.045% tungsten over the full 111 metre length
of the hole with localised two-metre zones of quartz-scheelite veining assaying up to 0.35% tungsten. Diamond drill
hole CMDD001, drilled to 258.0 metres at the Doyenwae prospect, intersected significant quartz + sulphide veining
throughout much of the hole. Examination of the core with an ultraviolet lamp detected widespread scheelite
mineralisation occurring both within quartz veins and as disseminations/aggregates in silica-altered sandstone
units; particularly in the interval from 130 metres to the end of the hole. The true width of potential mineralisation in
both MRC005 and CMDD001 is uncertain as preliminary observations of vein orientations in the CMDD001 drill core
indicate that the holes may have been drilled at a low angle to some of the mineralised quartz veins.
At the Orr Trig Prospect, diamond core hole CMDD002; drilled to 267.8 metres, intersected scattered zones of
narrow quartz veining and localised silicification over much of the hole with scheelite being observed as
disseminations in sandstone and within quartz veins in the interval between 100m and 250m. Although it would
appear that hole CMDD002 has been drilled in an appropriate direction with respect to the orientation of the quartz
veins, the amount of observable scheelite mineralisation is less than that noted in CMDD001. The results included:
1m @ 0.7% WO (from 131.45m) and 4.05m @ 0.58% WO from 185m in CMDD001.
3
3
Further drilling is required to test the dominant vein orientation as inferred from a mapping programme completed at
a quarrying site near the Doyenwae prospect.
Scheelite in diamond drill (as seen in ultraviolet and natural light)
Exploration Review
12
Scandinavia
Scandinavia
SWEDEN AND FINLAND
GOLD, COPPER , IRON, GRAPHITE
Cullen, through wholly-owber subsidiaries, has tenure in Scandinavia including: two exploration licences in Sweden
near Kiruna; and two claim reservations in the Kuusamo greenstone belt of far north eastern Finland near the
Juomasuo deposit (1.95Mt @ 4.9 g/t Au) of Dragon Mining Limited. (Dragon has announced total resources in its
Kuusamo project area of 3.4 Mt @ 4.2 g/t Au (460,700 oz), with historical, bonanza grade drill intersections at
Juomasuo including: 57.3m @ 62.56 g/t Au and 5.30m @ 206.85 g/t Au (www.dragon-mining.com.au)).
Cullen also has ground in Finland in the greenstone belts that host the Kittila gold deposit (Agnico – Eagle, 5 Moz of
Reserves, www.agnico-eagle.com); and the Rompas prospect Mawson Resources Ltd – Rompas is a discovery
with bonanza gold grades in surface channel samples including: 0.3m @ 1,866g/t Au and 8.0% U, and 0.26m @
1,510g/t Au and 3.95% U (www.mawsonresources.com).
Cullen has completed field reconnaissance and preliminary geochemical sampling over some of these areas and is
prioritising them for further work. Cullen has also reviewed various opportunities for graphite deposits in Finland and
retains three licences in northern Finland.
SUURIKUUSIKKO
NORTHEAST (CR)
Kiruna
Rovaniemi
Kuusamo
SUURIKUUSIKKO
SOUTH (CR)
250 kms
SWEDEN
NORWAY
FINLAND
AITOO (CR)
KOLARI (CR)
F I N L A N D
MISI (CR)
TUNTURI (CR)
MERIVAARA (EL)
ROMPAS WEST (CR)
Rovaniemi
KUUSAMO
WEST (CR)
ROMPAS CENTRAL (CR)
ROMPAS
SOUTH (CR)
KANASENVAARA (CR)
Kuusamo
Applications for Gold
Applications for Graphite
Claim Reservation
Ore Prospecting Licence
CR
EL
N
100 kilometres
13
Exploration Review
Canada
Canada
BRITISH COLUMBIA, TL PROPERTY
BASE METALS
Early in 2011, Cullen signed an agreement with a Vancouver-based private prospecting syndicate whereby Cullen
may earn an 80% interest in the TL Property located in south-east British Columbia, Canada. Cullen has
subsequently explored the property primarily for base metals with considerable early success.
In May and June 2011, Cullen dug three trenches to test geochemical anomalies which returned a best result of 3m
@ 8.98% Zn from channel samples, with highly anomalous molybdenum (maximum 1339 ppm) and rhenium
(maximum 580 ppb), copper, bismuth, nickel, tin, and tungsten. The trenches exposed an assemblage of
calcsilicate-marble, quartzite, biotite-garnet-schist and paragneiss. During October 2011, Cullen flew a heliTEM
(helicopter borne EM) survey across the entire TL project area in order to characterize the known “Trench”
mineralisation and prioritise targets. The survey identified a very strong, ~6000m long conductor trending east-west
beyond the trench site.
Cullen's trenches also exposed graphite-bearing schists and graphitic-sulphidic masses (see photos) including
coarse-grained “flake” graphite. Furthermore, a showing of “crystalline flake graphite” is recorded near Mabel Lake ~
5km west of the TL Property boundary in the “MINFILE” database of the BC Geological Survey. The host lithology to
this occurrence near Mabel Lake is interpreted by Cullen to be part of the same stratigraphy that occurs within the TL
Property.
In Spetember 2012, Cullen completed a small reconnaissance diamond drilling programme (six diamond drill holes
totaling 463m) at TL to test the high-grade zinc gossan, and the northern section of a discrete magnetic anomaly and
the “C-03” electromagnetic (EM) anomaly of approximately 600m length, surrounding the gossan.
The drilling intersected semi-massive, disseminated and interstitial pyrrhotite, pyrite and sphalerite in multiple zones
up to ~1m thick, in sections about 5-7m thick, within a calcsilicate - graphitic quartzite rock in holes 3, 4 and 5 . Best
intercepts of zinc mineralisation included: 2.16m @ 2.66% Zn and 2.1m @ 2.10% Zn.
This drilling has confirmed the presence of zinc mineralisation in massive sulphide beneath the surface gossan
zone, but has only tested it to a vertical depth of about 20m. Further drilling to evaluate the down-dip potential of the
Zn zone as well as the potential along strike is warranted.
Diamond drilling site at the gossan discovery
Exploration Review
14
Namibia
Namibia
TSUMEB
COPPER, REE, AND BASE METALS
2
Cullen has reviewed ~8,000km of prospective ground in Namibia targeting large, sediment-hosted, African copper
belt-type deposits; Tsumeb-type base metal deposits; and Rare Earth Elements (REEs) in carbonatites. A detailed
structural interpretation of aeromagnetic and gravity data has been completed over the Tsumeb project area, and in
February 2013, Cullen personnel undertook a further field review of the projects areas. On the basis of these data,
Cullen made applications to the Ministry of Mines and Energy in Namibia to surrender certain EPLs; and reduce
others to priority target areas.
An important factor in selecting key targets for follow-up work, was the depth of Kalahari sands which has been
found, from aeromagnetic interpretation, to be a prohibitive factor for further exploration in some of Cullen's EPL's.
Cullen's priority is now its two EPLs located just west of the Tsumeb and Tschudi copper deposits where several
magnetic anomalies have been outlined. EPL4493 lies across a low magnetic field corridor possibly reflecting deep
crustal demagnetization alteration caused by fluid flow, or structural depression of the strongly magnetic,
Palaeproterozoic basement is bound by the Tsumeb basement shear zone. These features may have controlled the
location of known copper deposits in the region and Cullen considers these EPLs are prospective for carbonatite-
hosted rare earths mineralisation or Tsumeb-style base metals mineralisation.
N
25 kilometres
Sand Cover
EPL4495
Tschudi (Cu, Ag)
Tsumeb
Tsumeb (Cu, Pb, Zn)
Abenab (V, Zn, Pb)
Tsumeb
Windhoek
NAMIBIA
EPL4493
Khusib Springs (Cu, Pb, Zn, Ag)
Tsu m eb B ase m ent
S hear Zone
Berg Aukas (Zn, Pb, V)
Grootfontein
Kombat (Cu, Pb, Zn, Ag)
Rietfontein
Sand cover
Cullen EPL’s
Prospect and deposit
Mineral occurrence (Copper or Base metal)
Neoproterozoic platform carbonates - fold
and thrust belt of Pan-African Damaran Orogen
15
Exploration Review
SCHEDULE OF TENEMENTS (as at 30 June 2013)
REGION
TENEMENTS
WA: ASHBURTON / PILBARA
Mt Stuart JV
Hardey Junction JV
Wyloo JV
Paraburdoo JV
EL08/1135, 1330, 1341,
EL08/1292
EL08/1166, 1189, 1763, 1843,
P08/546
EL08/1393, EL47/1154, 1649, 1650,
P08/556
EL52/1667
Tunnel Creek JV
EL52/1890, 1892
EL08/2227
EL08/2145
Hardey North
Wyloo
WA: NE GOLDFIELDS
Gunbarrel
EL53/1299, 1300 +/ *
EL53/1630, 1635
EL53/1637
EL53/1209,1637
EL53/1611
Irwin Well
Wonganoo
WA: ARUNTA
Lake Mackay
WA: EASTERN GOLDFIELDS
Killaloe
WA: FORRESTANIA
Forrestania JV
EL80/4209
EL63/1018, 1199, P63/1672, 1331-1333
EL77/1406, 1327, 1354, M77/0544
P77/3607, 3613, 3762, 3763
P77/3582 - 3588
EL20/714
WA: MURCHISON / NW YILGARN
North Tuckabianna
NEW SOUTH WALES
Minter
EL6572
NORTHERN TERRITORY
Amadeus
NAMIBIA
Tsumeb
SWEDEN
Kiruna area
FINLAND
EPL 4493, 4495
Holmajarvi 2 and Lavasjakka
Aitoo, Kolari, Kuusamo South & West,
Misi, Rompas South, West and Central,
Suuikuusikko Northeast and South,
Tunturi
ASSOCIATED
TENEMENTS/
APPLICATIONS
MLA08/481,482
EL20/808
E25493, 25494
CULLEN
INTEREST
COMMENTS
30%
20%
49%
100%
100%
100%
100%
100%
100%
100%
100%
20%
20%
100%
100%
100%
100%
100%
API has earned 70% of iron ore rights
Northern Star 80%
FMG can earn up to 80% of iron ore
rights
FMG can earn up to 80% of iron ore
rights
Thundelarra Exploration and Lion One
can earn up to 70%
+2.5% NPI Royalty to Pegasus on
Cullen's Rights
*1.5% NSR Royalty to Aurora
Matsa holds 80%
Hannans Reward Ltd - 80%
Applications only. No current interest
Claim reservations
CANADA
Mabel Lake
TL 1-16
Merivaara
EL application
Cullen earning 80%
Exploration Review
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E
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
DIRECTORS' REPORT
Your Directors submit their report for the year ended 30 June 2013.
Directors
The names and details of the company’s directors in office during the financial year and until the date of this
report are as follows. Directors were in office for this entire period unless otherwise stated.
Dr Denis Clarke BSc, BA, PhD, FAIMM (Non‐Executive Chairman) (Appointed 1 April 1999)
•
Dr Denis Clarke has more than 40 years’ experience in exploration and mining operations. Over 15 years with
Plutonic Resources (“Plutonic”), he contributed significantly at the General Manager level to its success as it
developed from a small explorer in 1983 to one of Australia’s largest gold miners prior to its take‐over in 1998 in
a transaction which valued Plutonic at $1 billion. Dr Clarke at various times managed the exploration, finance,
administration and corporate divisions. He subsequently was a director and consultant to Troy Resources
Limited for eleven years as it developed from explorer to a successful international gold miner. During the past
three years Dr Clarke has been Chairman or Non‐Executive Director of the following listed companies:
‐
LionGold Corp Ltd (from 1 October 2012 to present)
‐ Hill End Gold Limited (from 25 February 2010 to present)
‐
‐
‐
‐
‐
Signature Metals Limited (from 14 September 2012 to present)
Anglo Australian Resources NL (from 9 April 2004 to 28 November 2011)
BCD Resources NL (from 25 November 2004 to 25 February 2011)
BCD Resources (Operations) NL (from 27 February 2007 to 25 February 2011)
Troy Resources Limited (from 24 March 1999 to 27 November 2010)
•
Dr Chris Ringrose BSc, PhD, MBA, MAIMM, MAICD (Managing Director) (Appointed 19 June 2003)
Dr Chris Ringrose has been an exploration geologist based mainly in Western Australia since he completed his
geology degrees in Scotland in 1982. His career has included experience with EZ, Chevron and Aztec, and prior to
joining Cullen, he was Exploration Manager with Troy Resources Limited for nine years. Dr Ringrose has also
completed an MBA at Deakin University and brings to the Company significant management, exploration and
project evaluation experience gained both in Australia and overseas. Dr Ringrose has had no other directorships
of listed companies in the last three years.
Grahame Hamilton BSc, MSc, MAIG (Non‐Executive Director) (Appointed 1 April 1999)
•
Mr Grahame Hamilton, a graduate of the University of NSW, has extensive experience over 40 years in
exploration, corporate and project management. He has wide ranging expertise in project evaluation. Between
1994 and 1996 he managed the Brocks Creek exploration, environmental impact statement, feasibility study,
mine development and construction for Solomon Pacific Resources NL. Before Solomon, Mr Hamilton worked
with Getty Oil Development Co. ‐ Minerals Division as Queensland Manager. Mr Hamilton had been a director of
AIM‐listed public company Mariana Resources Limited until his resignation on 28 November 2008.
John Horsburgh BSc, MSc, FAIMM (Non‐Executive Director) (Appointed 1 April 1999)
•
Mr John Horsburgh, a graduate of the Royal School of Mines, has over 40 years’ industry experience including 11
years with Solomon Pacific Resources NL. Prior to this he gained extensive experience in Australia and overseas
with Getty Oil Development Co., Billiton and RTZ Group. Mr Horsburgh is Non‐Executive Chairman of AIM‐listed
public company Mariana Resources Limited.
‐ 17 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
•
Wayne John Kernaghan BBus, ACA, FAICD, ACIS (Non‐Executive Director and Company Secretary)
(Appointed 11 November 1997)
Mr Wayne Kernaghan is a member of the Institute of Chartered Accountants in Australia with a number of years
experience in various areas of the mining industry. He is also a Fellow of the Australian Institute of Company
Directors. During the past three years Mr Kernaghan has held, and is currently a director and holds, the following
listed company directorships:
‐
‐
‐
Gulf Industrials Limited (from 30 June 2005)
South American Ferro Metals Limited (from 26 June 2012)
Farmworks Australia Limited (from 19 February 2010 to 24 August 2011)
Principal Activities
The principal activity for the Consolidated Entity comprising Cullen Resources Limited ("the Company") and its
controlled entities (together "the Consolidated Entity") during the course of the financial year was mineral
exploration. There was no significant change in the nature of the Consolidated Entity's activities during the year.
Results
The loss attributable to the Consolidated Entity for the financial year was $ 2,078,566 [2012: loss $2,649,846].
No income tax was attributable to this result [2012: Nil].
Dividends
The directors do not recommend the payment of a dividend for this financial year. No dividend has been
declared or paid by the Company since the end of the previous financial year.
Significant Changes in the State of Affairs
In the opinion of the directors there were no significant changes in the state of affairs of the Consolidated Entity
that occurred during the financial year under review not otherwise disclosed in this report or the consolidated
financial statements.
Review of Operations
Cullen is a mineral exploration company seeking deposits of gold, nickel, copper, uranium and iron ore either in
its own right, or managed by other partners in Joint Ventures.
During the year under review, the Company continued its mineral exploration activities including: project
generation, database reviews, field mapping and geochemical surveying, and drilling programmes. Company
exploration activities, including Joint Venture managed projects, were focused in Western Australia with
additional activities in New South Wales as follows:
Ashburton Province, WA (Hardey Junction JV, Mt Stuart JV, Wyloo JV, Paraburdoo JV and Tunnel Creek
/Saltwater Pool JV ‐ gold, uranium and /or iron ore projects)
North Eastern Goldfields, WA (Gunbarrel/Mt Eureka and Irwin Bore, gold and nickel projects)
Eastern Goldfields, WA (Killaloe, gold and nickel project)
Murchison (North Tuckabianna , copper and gold project)
Forrestania, WA (Forrestania JV, gold and nickel project)
Central Lachlan Fold Belt, NSW (Minter tungsten project)
Eromanga, Millungera and Galilee Basins, NW Queensland (coal and copper‐gold projects)
Drilling by Cullen or its Joint Venture partners during the year to 30 June 2013 included programmes for for
copper and gold at the North Tuckabianna project; for tungsten at Minter; and for nickel deposits in the Mt
Eureka project area. Other exploration field work has included: field reconnaissance, geological mapping,
geochemical surveys, and evaluations of new project opportunities. The Company continued to market projects
as potential farm‐out opportunities.
‐ 18 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
Also during the year the Company continued exploration activities in Namibia, in south‐west Africa with
aeromagnetic data interpretation for copper in two prospective terranes. The company also has an exploration
presence in Scandinavia with applications in Sweden and Finland. The company has applied for a number of
tenements with graphite prospectivity in Finland.
Also overseas, Cullen progressed work at the “TL Property” project in south‐east British Columbia in a search for
base metals. The first pass trenching programme Cullen conducted discovered high‐grade zinc mineralisation at
surface for further evaluation, a heliTEM survey has been flown and preliminary drill targets was completd.
A total of $ 1,912,358 (2012: $2,619,442) was spent on exploration by Cullen during the year, with Joint Venture
Partners contributing further exploration funds on Cullen tenements.
Cullen will continue to identify and evaluate both advanced and "grass roots" projects throughout Australia and
in selected overseas locations. Cullen’s portfolio is under continual evaluation to focus on projects likely to result
in discovery of an economic mineral deposit.
Corporate
At 30 June 2013 available cash totalled $ 1,884,038 (2012: $2,459,240).
After Balance Date Events
There has not arisen in the interval between the end of the financial year and the date of this report any item,
transaction or event of a material and unusual nature likely, in the opinion of the directors, to affect the
operations of the Consolidated Entity, the results of those operations or the state of affairs of the Consolidated
Entity in the subsequent financial years.
Likely Developments and Future Results
Other than as referred to in this report, further information as to likely developments in the operations of the
Consolidated Entity and the expected results of those operations would, in the opinion of the directors, be
speculative and not in the best interests of the Consolidated Entity.
Environmental Regulation
The exploration activities of the Consolidated Entity in Australia are subject to environmental regulation under
the laws of the Commonwealth and the States in which those exploration activities are conducted. The
environmental laws and regulations generally address the potential impact of the Consolidated Entity's activities
in the areas of water and air quality, noise, surface disturbance and the impact upon flora and fauna. The
directors are not aware of any environmental matter which would have a materially adverse impact on the
overall business of the Consolidated Entity.
Options
As at the date of this report the Company has 22,000,000 (2012: 22,000,000) options which were outstanding.
Refer to Note 11 of the financial statements for further details of the options outstanding.
During the year no fully paid ordinary shares were issued by virtue of the exercise of options (2012: Nil). Since
the end of the financial year no shares have been issued by virtue of the exercise of options (2012: Nil).
‐ 19 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
Directors’ Interest
At the date of this report, the interest of the directors in the shares and options of the company were:
2013
D. Clarke
C. Ringrose
G. Hamilton
J. Horsburgh
W. Kernaghan
Direct
Fully Paid Shares
‐
950,000
‐
2
2,000,000
Options
2,000,000
8,000,000
2,000,000
2,000,000
2,000,000
Indirect
Fully Paid Shares
5,364,000
‐
15,891,004
17,452,122
2,373,376
Options
‐
‐
‐
‐
‐
Directors' Meetings
During the year the Company held thirteen meetings of directors. The attendance of the directors at meetings
of the Board were:
D. Clarke
C. Ringrose
G. Hamilton
J. Horsburgh
W. Kernaghan
Board of Directors
Attended
13
13
13
13
13
Maximum possible
eligible to attend
13
13
13
13
13
Indemnification and insurance of Directors and Officers
The Company has entered into deeds of indemnity with the Directors indemnifying them against certain
liabilities and costs to the extent permitted by law. The Company has paid premiums totalling $19,995 (2012:
$19,995) in respect of Directors and Officers Liability Insurance and Company reimbursement policies, which
covers all Directors and Officers of the Company. The policy conditions preclude the Company from any detailed
disclosures.
Employees
The Consolidated Entity employed three employees as at 30 June 2013 (2012: 3).
Corporate Governance
In recognising the need for the highest standard of corporate behaviour and accountability, the directors of
Cullen Resources Limited support and have adhered to the principles of good corporate governance. The
Company’s corporate governance statement is on page 26.
Auditor Independence
The directors have received the auditor’s independence declaration for the year ended 30 June 2013 which is on
page 24 and forms part of this directors’ report. For the year Ernst & Young have provided non‐audit services to
the Consolidated Entity in the amount of $2,000(2012: $17,650).
The directors are satisfied that non‐audit services are compatible with the independence requirements of the
Corporations Act 2001. The nature and scope of the non‐audit services provided has meant that auditor
independence was not compromised.
‐ 20 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
REMUNERATION REPORT (AUDITED)
This report details the nature and amount of remuneration for each director of Cullen Resources Limited.
This remuneration report outlines the director and executive remuneration arrangements of the Consolidated
Entity in accordance with the requirements of the Corporations Act 2001 and its Regulations. For the purposes of
this report, key management personnel (KMP) of the Consolidated Entity are defined as those persons having
authority and responsibility for planning, directing and controlling the major activities of the Consolidated Entity,
directly or indirectly, including any director (whether executive or otherwise) of the parent company. Only
directors of the Consolidated Entity meet the definition of key management personnel as the executive role is
performed by the executive director.
Details of key management personnel:
Directors
D. Clarke
C. Ringrose
G. Hamilton
J. Horsburgh
W. Kernaghan
Chairman (Non‐Executive)
Managing Director
Director (Non‐Executive)
Director (Non‐Executive)
Director (Non‐Executive)
Remuneration Policy
The remuneration policy of Cullen Resources Limited has been designed to align director objectives with
shareholder and business objectives by providing a fixed remuneration component and offering specific long‐
term incentives. The board of Cullen Resources Limited believes the remuneration policy to be appropriate and
effective in its ability to attract and retain the best executives and directors to run and manage the Company as
well as create goal congruence between directors and shareholders.
The Board’s policy for determining the nature and amount of remuneration for Board members is as follows.
The remuneration policy, setting the terms and conditions for the executive director was developed by the
Board. The executive receives a base salary on factors such as length of service and experience, superannuation,
options and incentives. The Board reviews executive packages annually by reference to executive performance
and comparable information from industry sectors and other listed companies in similar industries.
The Board policy is to remunerate non‐executive directors at market rates for comparable companies for time,
commitment and responsibilities. The Board determines payments to the non‐executive directors and reviews
their remuneration annually, based on market practice, duties and accountability. Independent external advice is
sought when required. The maximum aggregate amount of fees that can be paid to non‐executive directors is
subject to approval by shareholders at the Annual General Meeting. Fees for non‐executive directors are not
linked to either long term or short term performance of the Consolidated Entity. However, to align directors’
interest with shareholder interests, the directors are encouraged to hold shares in the Company. There is a
specified aggregate directors fees of $250,000 for non‐executive directors which was approved by shareholders
at a general meeting of the Company. The $250,000 excludes other services outside of non‐executive directors'
fees.
Remuneration Incentives
Director and executive remuneration is currently not linked to either long term or short term performance
conditions. The Board feels that the expiry date and exercise price of the options currently on issue to the
directors and executives is sufficient to align the goals of the directors and executives with those of the
shareholders to maximise shareholder wealth, and as such, has not set any performance conditions for the
directors or the executives of the Company. The Board will continue to monitor this policy to ensure that it is
appropriate for the Company in future years.
‐ 21 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
Group performance and shareholder wealth
Below is a table summarising key performance and shareholder wealth statistics for the Consolidated Entity over
the last five years.
Financial Year
30 June 2009
30 June 2010
30 June 2011
30 June 2012
30 June 2013
Loss After Tax
$
6,307,393
2,161,235
1,640,087
2,649,846
2,078,566
EPS
Cents
(1.14)
(0.39)
(0.27)
(0.41)
(0.28)
Share Price
Cents
2.6
3.4
3.0
1.8
0.8
Employment Contract ‐ Managing Director
Pursuant to an agreement Dr Ringrose will provide managing director services to the Company. The term of this
arrangement is from 1 November 2006 and will continue thereafter unless terminated on not less than three
months' notice given at any time. Effective from 1 April 2011 Dr Ringrose’s salary is $265,000pa. The position of
the director will become redundant under this agreement in the limited circumstances where the employment
of the Managing Director is terminated as a result of a takeover or merger of the Company. The Company will
pay the Managing Director the equivalent of four weeks per year of service or part thereof of his base salary as a
redundancy payment.
As part of Dr Ringrose's employment package he was issued with 8,000,000 options on 1 December 2010 with
the following terms. The options will expire on the earlier of the date which is one month after the Director to
whom the options are issued ceases to be a Director of the Company (or such longer period as determined by
the Board of Directors) or at 5.00 pm on 30 November 2013 ("the Expiry Date") with an exercise price of $0.075.
This is contained in the notice of meeting which was approved by shareholders.
During the year the Board paid a discretionary bonus of Nil (2012: $10,000) to Dr Ringrose. This bonus was
discretionary therefore there were no performance conditions attached to this bonus.
Non Executive Directors
The non executive directors have been issued with two million options each on 1 December 2010 with an
exercise price of $0.075 each. The options will expire on the earlier of the date which is one month after the
Director to whom the options are issued ceases to be a Director of the Company (or such longer period as
determined by the Board of Directors) or at 5.00 pm on 30 November 2013 ("the Expiry Date"). This is contained
in the notice of meeting which was approved by shareholders.
Directors’ and Executives’ Remuneration
Details of remuneration provided to directors who include the most highly remunerated executives for the year
ended 30 June 2013 are as follows:
Directors
Short Term
Director
Fees
$
35,000
‐
30,000
30,000
30,000
125,000
Salary/
Consult‐
ing
$
‐
265,000
14,850
‐
38,125
317,975
Bonus
$
Non
Monetary
Benefits
$
‐
‐
‐
‐
‐
‐
‐
* 6,836
‐
‐
‐
6,836
D. Clarke
C. Ringrose
G. Hamilton
J. Horsburgh
W. Kernaghan
Total
* This relates to the provision of a motor vehicle.
Post
Employ‐
ment
Super‐
annuation
$
3,150
23,850
2,700
2,700
2,700
35,100
Long
Term
Long
Service
Leave
$
‐
(18,500)
‐
‐
‐
(18,500)
Share
Based
Payments
Options
$
‐
‐
‐
‐
‐
‐
Perfor‐
mance
Related
%
‐
‐
‐
‐
‐
‐
Total
$
38,150
277,186
47,550
32,700
70,825
466,411
‐ 22 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
The Company has no policy on directors and executives entering into contracts to hedge their exposure to
options or shares granted as part of their remuneration package.
Details of remuneration provided to directors who include the most highly remunerated executives for the year
ended 30 June 2012 are as follows:
Directors
Short Term
Post
Employ‐
ment
Super‐
annuation
$
3,150
Long
Term
Long
Service
Leave
$
‐
Director
Fees
$
35,000
Salary/
Consult‐
ing
$
‐
Bonus
$
‐
Non
Monetary
Benefits
$
‐
D. Clarke
C. Ringrose
G. Hamilton
J. Horsburgh
W. Kernaghan
‐
265,000
10,000
* 6,836
24,750
8,208
30,000
30,000
30,000
80,775
‐
41,000
‐
‐
‐
‐
‐
‐
2,700
2,700
2,700
‐
‐
‐
Total
125,000
386,775
10,000
6,836
36,000
8,208
* This relates to the provision of a motor vehicle.
Share
Based
Payments
Options
$
‐
‐
‐
‐
‐
‐
Perfor‐
mance
Related
%
‐
‐
‐
‐
‐
‐
Total
$
38,150
314,794
113,475
32,700
73,700
572,819
Options granted as part of remuneration for the year ended 30 June 2013
There were nil (2012: nil) options granted as part of director and executive emoluments during the year.
Shares issued on exercise of remunerated options
During the financial year nil (2012: Nil) remunerated options were exercised. During the financial year nil
(2012: nil) options expired. The directors exercised nil (2012: Nil) options during the year.
Directors
D. Clarke
C. Ringrose
G. Hamilton
J. Horsburgh
W. Kernaghan
Value of options
granted during the
year
$
‐
‐
‐
‐
‐
Value of options
exercised during the
year
$
‐
‐
‐
‐
‐
Value of options
expired during the year
$
‐
‐
‐
‐
‐
Total value of options
granted, exercised and
expired during the year
$
‐
‐
‐
‐
‐
There were no options granted as a part of remuneration for the year ended 30 June 2013.
Options granted as part of remuneration for the year ended 30 June 2012
Directors
D. Clarke
C. Ringrose
G. Hamilton
J. Horsburgh
W. Kernaghan
Value of options
granted during the
year
$
‐
‐
‐
‐
‐
Value of options
exercised during the
year
$
‐
‐
‐
‐
‐
Value of options
expired during the year
$
‐
‐
‐
‐
‐
Total value of options
granted, exercised and
expired during the year
$
‐
‐
‐
‐
‐
There were no options granted as a part of remuneration for the year ended 30 June 2012.
End of Remuneration Report
‐ 23 ‐
Ernst & Young
11 Mounts Bay Road
Perth WA 6000 Australia
GPO Box M939 Perth WA 6843
Tel: +61 8 9429 2222
Fax: +61 8 9429 2436
ey.com/au
Auditor’s Independence Declaration to the Directors of Cullen Resources
Limited
In relation to our audit of the financial report of Cullen Resources Limited for the financial year ended
30 June 2013, to the best of my knowledge and belief, there have been no contraventions of the auditor
independence requirements of the Corporations Act 2001 or any applicable code of professional conduct.
Ernst & Young
P McIver
Partner
16 September 2013
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
PM:DR:CULLEN:017
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
Signed in accordance with a resolution of the directors
C. Ringrose
Director
Perth, WA
16 September 2013
‐ 25 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
CORPORATE GOVERNANCE STATEMENT
In recognising the need for the highest standards of corporate behaviour and accountability, the directors of
Cullen Resources Limited have adhered to the principles of corporate governance and this statement outlines
the main corporate governance practices in place throughout the financial year. The ASX Corporate Governance
Council released revised Corporate Governance Principles and Recommendations on 2 August 2007. Having
regard to the size of the Company and the nature of its enterprise, it is considered that the Company complies
as far as possible with the spirit and intentions of the ASX Corporate Governance Council's Corporate
Governance Principles and Recommendations. Unless otherwise stated, the practices were in place for the
entire year.
Board of Directors
The Board of Directors of the Company is responsible for the corporate governance of the Company. The Board
guides and monitors the business and affairs of the Company on behalf of the shareholders by whom they are
elected and to whom they are accountable.
As the Board acts on behalf of shareholders, it seeks to identify the expectations of shareholders, as well as
other ethical expectations and obligations. In addition, the Board is responsible for identifying areas of
significant business risk and ensuing arrangements are in place to adequately manage those risks.
The primary responsibility of the Board includes:
formulation and approval of the strategic direction, objectives and goals of the Company;
monitoring the financial performance of the Company, including approval of the Company’s financial
statements;
ensuring that adequate internal control systems and procedures exists and that compliance with these
systems and procedures is maintained;
the identification of significant business risks and ensuring that such risks are adequately managed;
the review of performance and remuneration of executive directors; and
the establishment and maintenance of appropriate ethical standards.
The responsibility for the operation and administration of the Company is carried out by the directors, who
operate in an executive capacity, supported by senior professional staff. The Board ensures that this team is
suitably qualified and experienced to discharge their responsibilities, and assesses on an ongoing basis the
performance of the management team, to ensure that management’s objectives and activities are aligned with
the expectations and risks identified by the Board.
The Directors of the Company are as follows:
Dr Denis Clarke
Dr Chris Ringrose
Grahame Hamilton
John Horsburgh
Wayne Kernaghan
For information in respect to each director refer to the Directors' Report.
‐ 26 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
Independent Directors
Under ASX guidelines, principle 2.1, two of the current Board of five directors are considered to be independent
directors. Dr Ringrose is the executive director and Mr Horsburgh and Mr Hamilton, who are former executive
directors, are, under the ASX guidelines deemed not to be independent by virtue of their positions or former
positions. The Board is satisfied that the structure of the Board is appropriate for the size of the Company and
the nature of its operations and is a cost effective structure for managing the Company.
Board Composition
When the need for a new director is identified, selection is based on the skills and experience of prospective
directors, having regard to the present and future needs of the Company. Any director so appointed must then
stand for election at the next Annual General Meeting of the Company.
Terms of Appointment as a Director
The constitution of the Company provides that a Director, other than the Managing Director, may not retain
office for more than three calendar years or beyond the third annual general meeting following his or her
election, whichever is longer, without submitting for re‐election. One third of the Directors must retire each
year and are eligible for re‐election. The Directors who retire by rotation at each annual general meeting are
those with the longest length of time in office since their appointment or last election.
Board Committees
In view of the size of the Company and the nature of its activities, the Board has considered that establishing
formally constituted committees for audit, board nominations and remuneration would contribute little to its
effective management. Accordingly audit matters, the nomination of new Directors and the setting, or review,
of remuneration levels of Directors and senior executives are reviewed by the Board as a whole and approved
by resolution of the Board (with abstentions from relevant Directors where there is a conflict of interest).
Where the Board considers that particular expertise or information is required, which is not available from
within their number, appropriate external advice may be taken and reviewed prior to a final decision being
made by the Board.
Remuneration
Remuneration and other terms of employment of executives, including executive directors, are reviewed
periodically by the Board having regard to performance, relevant comparative information and, where
necessary, independent expert advice. Remuneration packages are set at levels that are intended to attract and
retain executives capable of managing the Company’s operations.
The terms of engagement and remuneration of executive directors is reviewed periodically by the Board, with
recommendations being made by the non‐executive directors. Where the remuneration of a particular
executive director is to be considered, the director concerned does not participate in the discussion or decision
making.
Make Timely and Balanced Disclosure
The board has in place written policies and procedures to ensure the Company complies with its obligations
under the continuous disclosure rule 3.1 and other ASX Listing Rule disclosure requirements.
Independent Professional Advice
Directors have the right, in connection with their duties and responsibilities as directors, to seek independent
professional advice at the Company’s expense. Prior approval of the Chairman is required, which will not be
unreasonably withheld.
‐ 27 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
Code of Conduct
In view of the size of the Company and the nature of its activities, the Board has considered that an informal
code of conduct is appropriate to guide executives, management and employees in carrying out their duties and
responsibilities.
Diversity Policy
The Company is in the process of establishing a diversity policy.
As at 30 June 2013, 33.3% (2012: 33.3%) of the workforce is female with no females at board or senior
management level.
Communication to Market & Shareholders
The Board of directors aims to ensure that the shareholders, on behalf of whom they act, are informed of all
information necessary to assess the performance of the directors and the Company. Information is
communicated to shareholders and the market through:
the Annual Report which is available to all shareholders;
other periodic reports which are lodged with ASX and available for shareholder scrutiny;
other announcements made in accordance with ASX Listing Rules;
special purpose information memoranda issued to shareholders as appropriate;
the Annual General Meeting and other meetings called to obtain approval for board action as appropriate;
and,
The Company's website.
Share Trading
Dealings are not permitted at any time whilst in the possession of price sensitive information not already
available to the market. In addition, the Corporations Act 2001 prohibits the purchase or sale of securities whilst
a person is in possession of inside information.
External Auditors
The external auditor is Ernst and Young. The external auditors are invited to attend the annual general meeting
and be available to answer shareholder questions about the conduct of the audit and the preparation and
content of the auditor's report.
Full details of the company’s corporate governance practices can be viewed at its website
www.cullenresources.com.au.
‐ 28 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
Consolidated Statement of Financial Position
as at 30 June 2013
Current Assets
Cash and cash equivalents
Receivables
Total Current Assets
Non Current Assets
Other financial assets
Plant & Equipment
Exploration & Evaluation
Total Non Current Assets
Total Assets
Current Liabilities
Trade and other payables
Provisions
Total Current Liabilities
Non Current Liabilities
Provisions
Total Non Current Liabilities
Total Liabilities
Net Assets
Equity
Issued Capital
Share based payment reserve
Available for sale reserve
Accumulated Losses
Total Equity
Note
22(i)
5
6
7
8
9
10
10
11
12
13
14
Consolidated
2013
$
1,884,038
38,286
1,922,324
32,400
3,172
4,211,622
4,247,194
6,169,518
108,266
103,917
212,183
26,602
26,602
238,785
2012
$
2,459,240
144,015
2,603,255
32,400
5,974
3,751,958
3,790,332
6,393,587
814,465
143,597
958,062
22,226
22,226
980,288
5,930,733
5,413,299
39,201,266
1,280,125
‐
(34,550,658)
5,930,733
36,605,266
1,280,125
‐
(32,472,092)
5,413,299
These financial statements should be read in conjunction with the accompanying notes.
‐ 29 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
Consolidated Statement of Changes in Equity
for the year ended 30 June 2013
Note
Issued
Capital
$
Share Based
Payment
Reserve
$
Available for
Sale
Reserve
$
Accumulated
Losses
$
Total
Equity
$
At 1 July 2011
34,610,266
1,280,125
(20,000)
(29,822,246)
6,048,145
Loss for the year
Other comprehensive income
13
Release of unrealised loss
reserve due to impairment
Total comprehensive
income/(expense) for the year
Issue of share capital
Share issue costs
‐
‐
‐
‐
2,100,000
(105,000)
Share based payments
12
‐
‐
‐
‐
‐
‐
‐
‐
At 30 June 2012
36,605,266
1,280,125
‐
‐
20,000
(2,649,846)
(2,649,846)
‐
‐
‐
20,000
20,000
(2,649,846)
(2,629,846)
‐
‐
‐
‐
‐
‐
‐
2,100,000
(105,000)
‐
(32,472,092)
5,413,299
Note
Issued
Capital
$
Share Based
Payment
Reserve
$
Available for
Sale
Reserve
$
Accumulated
Losses
$
Total
Equity
$
At 1 July 2012
36,605,266
1,280,125
Loss for the year
Other comprehensive income
13
Total comprehensive
income/(expense) for the year
Issue of share capital
Share issue costs
‐
‐
‐
2,706,000
(110,000)
Share based payments
12
‐
‐
‐
‐
‐
‐
‐
At 30 June 2013
39,201,266
1,280,125
‐
‐
‐
‐
‐
‐
‐
‐
(32,472,092)
5,413,299
(2,078,566)
(2,078,566)
‐
‐
(2,078,566)
(2,078,566)
‐
‐
‐
2,706,000
(110,000)
‐
(34,550,658)
5,930,733
These financial statements should be read in conjunction with the accompanying notes.
‐ 30 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
Consolidated Statement of Comprehensive Income
for the year ended 30 June 2013
Note
3
8
12
4
Revenues
Rent
Salaries and Consultants' fees
Compliance expenses
Impairment of exploration expenditure
Share based payments
Impairment of available for sale investments
Depreciation
Other expenses
Loss before income tax
Income tax benefit
Net Loss attributable to members of
Cullen Resources Limited after tax
Other Comprehensive Income:
2013
$
49,708
(42,810)
(408,234)
(179,679)
(1,452,694)
‐
‐
(5,421)
(195,627)
Consolidated
2012
$
168,990
(38,336)
(416,959)
(188,479)
(2,009,986)
‐
(6,845)
(5,634)
(152,597)
(2,234,757)
(2,649,846)
156,191
‐
(2,078,566)
(2,649,846)
Net change in fair value of available for sale assets 13
Release of unrealised loss reserve due to impairment 13
‐
‐
‐
20,000
Total comprehensive income/(loss)
for the period
Basic (loss) per share
(cents per share)
Diluted (loss) per share
(cents per share)
(2,078,566)
(2,629,846)
23
23
(0.28)
(0.41)
(0.28)
(0.41)
These financial statements should be read in conjunction with the accompanying notes.
‐ 31 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
Consolidated Statement of Cash Flows
for the year ended 30 June 2013
Note
Consolidated
2013
$
2012
$
Cash flows from operating activities
Research and development grant
Cash payments in the course of operations
GST refunded
Interest received
156,191
(1,597,202)
144,305
40,481
‐
(358,177)
124,895
71,982
Net operating cash flows
22(ii)
(1,256,225)
(161,300)
Cash flows from investing activities
Security deposits
Proceeds from sale of investment
Payment for plant & equipment
Payments for exploration & evaluation
Net investing cash flows
Cash flows from financing activities
Proceeds from issue of shares
Share issue costs
Net financing cash flows
Net increase/(decrease) in cash
and cash equivalents
Cash and cash equivalents at the
beginning of the financial year
Cash and cash equivalents at the end
of the financial year
‐
‐
(2,619)
(1,912,358)
(22,400)
635,125
‐
(2,619,442)
(1,914,977)
(2,006,717)
2,706,000
(110,000)
2,100,000
(105,000)
2,596,000
1,995,000
(575,202)
(173,017)
2,459,240
2,632,257
22(i)
1,884,038
2,459,240
These financial statements should be read in conjunction with the accompanying notes.
‐ 32 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
Notes to the Financial Statements
1.
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES
Basis of preparation
(a)
The financial statements are general purpose financial statements, which have been prepared in accordance with the requirements
of the Corporations Act 2001, and Australian Accounting Standards. The financial statements have also been prepared in
accordance with the historical cost convention using the accounting policies described below and do not take account of changes in
either the general purchasing power of the dollar or in prices of specific assets.
Statement of compliance
(b)
The financial statements comply with Australian Accounting Standards as issued by the Australian Accounting Standards Board and
International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board.
Accounting policies and disclosures
(c)
The Group has adopted all new and amended Australian Accounting Standards and AASB interpretations which were applicable as of
1 July 2012. Adoption of these new and amended Australian Accounting Standards and ASSB interpretations did not have any effect
on the financial position or performance of the Group.
The Group has not elected to early adopt any new standards or amendments.
Going Concern
The accounts have been prepared on the going concern basis, which contemplates continuity of normal business activities and the
realisation of assets and liabilities in the normal course of business.
The consolidated group had cash assets of $1,884,038 at 30 June 2013. The directors acknowledge that continued exploration and
development of the consolidated group’s mineral exploration projects will necessitate further capital raisings.
The consolidated group remains dependent on its ability to raise funding in volatile capital markets. However, the directors
continue to believe that the going concern basis of accounting by the consolidated group is appropriate as the company and
consolidated group have successfully completed a capital raising during the year to 30 June 2013, notwithstanding the challenging
conditions in equity markets.
In consideration of the above matters, the directors have determined that it is reasonably foreseeable that the consolidated group will
continue as going concern and that it is appropriate that the going concern method of accounting be adopted in the preparation of the
financial statements. In the event that the consolidated group is unable to continue as a going concern (due to inability to raise future
funding requirements), it may be required to realise its assets at amounts different to those currently recognised, settle liabilities other
than in the ordinary course of business and make provisions for other costs which may arise as a result of cessation or curtailment of
normal business operations.
Accordingly, the financial statements do not include adjustments relating to the recoverability and classification of assets amount
or to the amounts and classification of liabilities that might be necessary if the consolidated group does not continue a going
concern.
Principles of consolidation
(d)
The consolidated financial statements include the financial statements of Cullen Resources Limited and the results of all of its
controlled entities which are referred to collectively throughout these financial statements as the “Consolidated Entity”. The results
of controlled entities are prepared for the same reporting period as the parent, using consistent accounting policies. All inter‐entity
balances and transactions, and unrealised profits arising from intra‐economic entity transactions, have been eliminated in full.
Taxes
(e)
Income tax
Deferred income tax is provided on all temporary differences at the balance sheet date between the tax bases of assets and
liabilities and their carrying amounts for financial reporting purposes.
Deferred income tax liabilities are recognised for all taxable temporary differences, except:
where the deferred income tax liability arises from the initial recognition of goodwill or of an asset or liability in a transaction
that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or
loss; or
33
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
in respect of taxable temporary differences associated with investments in subsidiaries, associates and interest in joint venture,
where the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary
differences will not reverse in the foreseeable future.
Deferred income tax assets are recognised for all deductible temporary differences, carry‐forward of unused tax assets and unused
tax losses, to the extent that it is probable that taxable profit will be available against which the deductible temporary differences,
and the carry‐forward of unused tax credits and unused tax losses can be utilised, except:
where the deferred income tax asset relating to the deductible temporary difference arises from the initial recognition of an
asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the
accounting profit nor taxable profit or loss; or
in respect of deductible temporary differences associated with investments in subsidiaries, associates and interests in joint
ventures, deferred tax assets are only recognised to the extent that it is probable that the temporary differences will reverse
in the foreseeable future and taxable profit will be available against which the temporary differences can be utilised.
The carrying amount of deferred income tax assets is reviewed at each reporting date and reduced to the extent that it is no longer
probable that sufficient taxable profit will be available to allow all or part of the deferred income tax asset to be utilised.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is
realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the balance
sheet date.
Income taxes relating to items recognised directly in equity are recognised in equity and not in the Consolidated Statement of
Comprehensive Income.
Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST except:
where the GST incurred on a purchase of goods and services is not recoverable from the taxation authority, in which case the GST
is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable; and
receivables and payables are stated with the amount of GST included.
The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the
Consolidated Statement of Financial Position. Cash flows are included in the Consolidated Statement of Cash Flows on a gross basis
and the GST component of cash flows arising from investing and financing activities, which is recoverable from, or payable to, the
taxation authority are classified as operating cash flows.
Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the taxation authority.
Provision for employee benefits
(f)
Provision has been made in the financial statements for benefits accruing to employees in relation to annual leave and long service
leave. Annual leave provisions expected to be settled within twelve months are measured at their nominal amounts. Long service
leave provisions are measured at the present value of the estimated future cash outflow to be made in respect of services provided
by employees up to the reporting date. In determining the present value of future cash outflows, the interest rates attaching to
national government bond securities which have terms to maturity approximating the terms of the related liabilities are used.
Investments in controlled entities
(g)
Investments in controlled entities are carried in the company’s financial statements at the lower of cost and recoverable amount.
Dividends and distributions are brought to account when they are proposed by the controlled entities.
Exploration and Evaluation Expenditure
Expenditure is deferred
(h)
(i)
Expenditure on exploration and evaluation is accounted for in accordance with the 'area of interest' method. Exploration and
evaluation expenditure is capitalised provided the rights to tenure of the area of interest is current and either:
the exploration and evaluation activities are expected to be recouped through successful development and exploitation of the
area of interest or, alternatively, by its sale; or
exploration and evaluation activities in the area of interest have not at the reporting date reached a stage that 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.
34
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
When the technical feasibility and commercial viability of extracting a mineral resource have been demonstrated then any
capitalised exploration and evaluation expenditure is reclassified as capitalised mine development. Prior to reclassification,
capitalised exploration and evaluation expenditure is assessed for impairment.
Impairment
The carrying value of capitalised exploration and evaluation expenditure is assessed for impairment at the area of interest level
whenever facts and circumstances suggest that the carrying amount of the asset may exceed its recoverable amount.
An impairment exists when the carrying amount of an area of interest exceeds its estimated recoverable amount. The area of
interest is then written down to its recoverable amount. Any impairment losses are recognised in the Consolidated Statement of
Comprehensive Income.
(i)
Both the functional and presentation currency of Cullen Resources Limited and its Australian subsidiaries is Australian dollars ($A).
Foreign currency
Foreign currency transactions are translated to Australian currency at the rate of exchange ruling at the date of the transactions.
Monetary items in foreign currencies at balance date are translated at the rates of exchange ruling on that date.
Exchange differences relating to amounts payable and receivable in foreign currencies are brought to account in the Consolidated
Statement of Comprehensive Income in the financial year in which the exchange rates change, as exchange gains or losses.
(j)
Plant and equipment is stated at cost less accumulated depreciation and any accumulated impairment losses.
Plant and equipment
Depreciation is calculated on a straight‐line basis over the estimated useful life of the assets as follows:
Plant and equipment – over 3 to 8 years.
The assets residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate at each financial year
end.
Revenue
(k)
Other revenue includes interest revenue on short term deposit received from other persons. It is brought to account 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.
Joint ventures
(l)
The Consolidated Entity’s interests in jointly controlled assets are accounted for by recognising its proportionate share in assets
and liabilities from joint ventures.
Joint venture expenses are recognised on a proportionate basis according to Cullen’s joint venture interest. The Consolidated
Entity does not currently receive any income from its joint venture assets.
The Consolidated Entity does not hold any interests in jointly controlled entities.
Payables
(m)
Liabilities for trade creditors and other amounts are carried at cost which is the fair value of the consideration to be paid in the
future for goods and services received, whether or not billed to the Consolidated Entity.
Cash and cash equivalents
(n)
Cash and cash equivalents in the balance sheet comprise cash at bank and in hand and short‐term deposits with an original
maturity 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. For the purposes of the Consolidated Statement of Cash Flows, cash includes cash on hand and in banks,
and money market investments readily convertible to cash within 2 working days.
Leases
(o)
The determination of whether an arrangement is or contains a lease is based on the substance of the arrangement and requires an
assessment of whether the fulfilment of the arrangement is dependent on the use of a specific asset or assets and the
arrangement conveys a right to use the asset.
Operating lease payments are recognised as an expense in the Consolidated Statement of Comprehensive Income on a straight‐line
basis over the lease term.
35
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
Issued capital
(p)
Issued and paid up capital is recognised at the fair value of the consideration received by the Consolidated Entity. Any transaction
costs arising on the issue of ordinary shares are recognised directly in equity as a reduction of the share proceeds received.
Earnings per share (EPS)
(q)
Basic EPS is calculated as net profit/(loss) attributable to members, adjusted to exclude costs of servicing equity, divided by the
weighted average number of ordinary shares, adjusted for any bonus element. Diluted EPS is calculated as net profit/ (loss)
attributable to members, adjusted for:
costs of servicing equity;
the after tax effect of interest associated with dilutive potential ordinary shares that have been recognised as expenses;
and
other non‐discretionary changes in revenues or expenses during the period that would result from the dilution of potential
ordinary shares;
divided by the weighted average number of ordinary shares, adjusted for any bonus element.
(r)
The accounting policies adopted are consistent with those of the previous year, except as noted at Note 1(c).
Change in accounting policies
Share based payments
(s)
At each subsequent reporting date until vesting, the cumulative charge to the Consolidated Statement of Comprehensive Income is
the product of:
(i)
(ii)
(iii)
The grant date fair value of the option.
The current best estimate of the number of options that will vest, taking into account such factors as the likelihood of
employee turnover during the vesting period and the likelihood of non‐market performance conditions being met.
The expired portion of the vesting period.
The charge to the Consolidated Statement of Comprehensive Income for the period is the cumulative amount as calculated above
less the amounts already charged in previous periods. There is a corresponding entry to equity.
The company may also issue options that do not have any vesting conditions.
Until an option has vested, any amounts recorded are contingent and will be adjusted if more or fewer options vest than were
originally anticipated to do so. Any option subject to a market condition is considered to vest irrespective of whether or not that
market condition is fulfilled, provided that all other conditions are satisfied.
If the terms of an equity‐settled option are modified, as a minimum an expense is recognised as if the terms had not been
modified. An additional expense is recognised for any modification that increases the total fair value of the share‐based payment
arrangement, or is otherwise beneficial to the employee, as measured at the date of modification.
If an equity‐settled option is cancelled, it is treated as if it had vested on the date of cancellation, and any expense not yet
recognised for the option is recognised immediately. However, if a new option is substituted for the cancelled option and
designated as a replacement option on the date that it is granted, the cancelled and new option are treated as if they were a
modification of the original option, as described in the previous paragraph.
The dilutive effect, if any, of outstanding options is reflected as additional share dilution in the computation of diluted earnings per
share.
Investment and other financial assets
(t)
Financial assets in the scope of AASB 139 Financial Instruments: Recognition and Measurement are classified as either financial assets
at fair value through profit or loss, loans and receivables, held‐to‐maturity investments, or available‐for‐sale investments, as
appropriate. When financial assets are recognised initially, they are measured at fair value, plus, in the case of investments not at fair
value through profit or loss, directly attributable transactions costs. The Consolidated Entity determines the classification of its
financial assets after initial recognition and, when allowed and appropriate, re‐evaluates this designation at each financial year‐end.
Subsequent measurement of available‐for‐sale financial assets
Available‐for‐sale financial assets are non‐derivative financial assets that are designated as available‐for‐sale. After initial
measurement, available–for‐sale financial assets are measured at fair value with unrealised gains or losses recognised as other
comprehensive income in the available‐for‐sale reserve until the investment is derecognised, at which time the cumulative gain or
loss recorded is recognised in the income statement, or determined to be impaired, at which time the cumulative loss recorded is
recognised in the income statement.
36
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
Impairment of non‐financial assets
(u)
Non‐financial assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may
not be recoverable. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable
amount. Recoverable amount is the higher of an asset's fair value less costs to sell and value in use. For the purposes of assessing
impairment, assets are grouped at the lowest levels for which there are separately identifiable cash inflows that are largely
independent of the cash inflows from other assets or groups of assets (cash‐generating units). Non‐financial assets other than
goodwill that suffered an impairment are tested for possible reversal of the impairment whenever events or changes in
circumstances indicate that the impairment may have reversed.
New accounting standards and interpretations
(v)
The financial report complies with Australian Accounting Standards and International Financial Reporting Standards (“IFRS”) as
issued by the International Accounting Standards Board (“IASB”).
International Accounting Standards and Interpretations that have recently been issued or amended but are not yet effective have
not been adopted by the Group for the annual reporting period ended 30 June 2013. These are outlined in the table below.
37
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
Application
date of
standard*
Application
date for
Group*
1 January
2013
1 July 2013
1 January
2014
1 July 2014
1 January
2013
1 July 2013
Reference
Title
Summary
AASB 2012‐2
AASB 2012‐3
AASB 2012‐5
Amendments to
Australian
Accounting
Standards ‐
Disclosures ‐
Offsetting
Financial Assets
and Financial
Liabilities
Amendments to
Australian
Accounting
Standards ‐
Offsetting
Financial Assets
and Financial
Liabilities
Amendments to
Australian
Accounting
Standards arising
from Annual
Improvements
2009‐2011 Cycle
AASB 2012‐2 principally amends AASB 7 Financial
Instruments: Disclosures to require disclosure of
the effect or potential effect of netting
arrangements. This includes rights of set‐off
associated with the entity's recognised financial
assets and liabilities on the entity's financial
position, when the offsetting criteria of AASB 132
are not all met.
AASB 2012‐3 adds application guidance to AASB
132 Financial Instruments: Presentation to address
inconsistencies identified in applying some of the
offsetting criteria of AASB 132, including clarifying
the meaning of "currently has a legally enforceable
right of set‐off" and that some gross settlement
systems may be considered equivalent to net
settlement.
AASB 2012‐5 makes amendments resulting from
the 2009‐2011 Annual Improvements Cycle. The
standard addresses a range of improvements,
including the following:
Repeat application of AASB 1 is permitted
(AASB 1).
Clarification of the comparative information
requirements when an entity provides a third
balance sheet (AASB 101 Presentation of
Financial Statements).
Interpretation
21
Levies^
This Interpretation confirms that a liability to pay a
levy is only recognised when the activity that
triggers the payment occurs. Applying the going
concern assumption does not create a constructive
obligation.
1 January
2014
1 July 2014
AASB 2012‐9
Amendment to
AASB 1048
arising from the
withdrawal of
Australian
Interpretation
1039
AASB 2012‐9 amends AASB 1048 Interpretation of
Standards to evidence the withdrawal of Australian
Interpretation 1039 Substantive Enactment of
Major Tax Bills in Australia.
1 January
2013
1 July 2013
‐ 38 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
Application
date of
standard*
Application
date for
Group*
1 January
2015
1 July 2015
Reference
Title
Summary
AASB 9
Financial
Instruments
AASB 9 includes requirements for the classification
and measurement of financial assets. It was
further amended by AASB 2010‐7 to reflect
amendments to the accounting for financial
liabilities.
These requirements improve and simplify the
approach for classification and measurement of
financial assets compared with the requirements
of AASB 139. The main changes are described
below.
a)
Financial assets that are debt instruments will
be classified based on (1) the objective of the
entity’s business model for managing the
financial assets; (2) the characteristics of the
contractual cash flows.
b) Allows an irrevocable election on initial
recognition to present gains and losses on
investments in equity instruments that are
not held for trading in other comprehensive
income. Dividends in respect of these
investments that are a return on investment
can be recognised in profit or loss and there is
no impairment or recycling on disposal of the
instrument.
c)
Financial assets can be designated and
measured at fair value through profit or loss
at initial recognition if doing so eliminates or
significantly reduces a measurement or
recognition inconsistency that would arise
from measuring assets or liabilities, or
recognising the gains and losses on them, on
different bases.
d) Where the fair value option is used for
financial liabilities the change in fair value is
to be accounted for as follows:
The change attributable to changes in credit
risk are presented in other comprehensive
income (OCI).
The remaining change is presented in profit or
loss.
If this approach creates or enlarges an
accounting mismatch in the profit or loss, the
effect of the changes in credit risk are also
presented in profit or loss.
Consequential amendments were also made to
other standards as a result of AASB 9, introduced
by AASB 2009‐11 and superseded by AASB 2010‐7
and 2010‐10.
‐ 39 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
Application
date of
standard*
Application
date for
Group*
1 January
2013
1 July 2013
1 January
2013
1 July 2013
1 January
2013
1 July 2013
Reference
Title
Summary
AASB 10
Consolidated
Financial
Statements
AASB 11
Joint
Arrangements
AASB 12
Disclosure of
Interests in Other
Entities
AASB 10 establishes a new control model that
applies to all entities. It replaces parts of AASB
127 Consolidated and Separate Financial
Statements dealing with the accounting for
consolidated financial statements and UIG‐112
Consolidation – Special Purpose Entities.
The new control model broadens the situations
when an entity is considered to be controlled by
another entity and includes new guidance for
applying the model to specific situations, including
when acting as a manager may give control, the
impact of potential voting rights and when holding
less than a majority voting rights may give control.
Consequential amendments were also made to
other standards via AASB 2012‐7.
AASB 11 replaces AASB 131 Interests in Joint
Ventures and UIG‐113 Jointly‐ controlled Entities –
Non‐monetary Contributions by Ventures. AASB 11
uses the principle of control in AASB 10 to define
joint control, and therefore the determination of
whether joint control exists may change. In
addition it removes the option to account for
jointly controlled entities (JCEs) using
proportionate consolidation. Instead, accounting
for a joint arrangement is dependent on the nature
of the rights and obligations arising from the
arrangement. Joint operations that give the
venturers a right to the underlying assets and
obligations themselves is accounted for by
recognising the share of those assets and
obligations. Joint ventures that give the venturers
a right to the net assets is accounted for using the
equity method.
AASB 12 includes all disclosures relating to an
entity’s interests in subsidiaries, joint
arrangements, associates and structures entities.
New disclosures have been introduced about the
judgments made by management to determine
whether control exists, and to require summarised
information about joint arrangements, associates
and structured entities and subsidiaries with non‐
controlling interests.
‐ 40 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
Application
date of
standard*
Application
date for
Group*
1 January
2013
1 July 2013
1 January
2013
1 July 2013
Reference
Title
Summary
AASB 13
Fair Value
Measurement
AASB 119
Employee
Benefits
AASB 13 establishes a single source of guidance for
determining the fair value of assets and liabilities.
AASB 13 does not change when an entity is
required to use fair value, but rather, provides
guidance on how to determine fair value when fair
value is required or permitted. Application of this
definition may result in different fair values being
determined for the relevant assets.
AASB 13 also expands the disclosure requirements
for all assets or liabilities carried at fair value. This
includes information about the assumptions made
and the qualitative impact of those assumptions
on the fair value determined.
Consequential amendments were also made to
other standards via AASB 2012‐8.
The main change introduced by this standard is to
revise the accounting for defined benefit plans.
The amendment removes the options for
accounting for the liability, and requires that the
liabilities arising from such plans is recognized in
full with actuarial gains and losses being
recognized in other comprehensive income. It also
revised the method of calculating the return on
plan assets.
The revised standard changes the definition of
short‐term employee benefits. The distinction
between short‐term and other long‐term
employee benefits is now based on whether the
benefits are expected to be settled wholly within
12 months after the reporting date.
Consequential amendments were also made to
other standards via AASB 2012‐10.
‐ 41 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
Application
date of
standard*
Application
date for
Group*
1 January
2013
1 July 2013
1 July 2013
1 July 2013
Reference
Title
Summary
This interpretation applies to stripping costs
incurred during the production phase of a surface
mine. Production stripping costs are to be
capitalised as part of an asset, if an entity can
demonstrate that it is probable future economic
benefits will be realised, the costs can be reliably
measured and the entity can identify the
component of an ore body for which access has
been improved. This asset is to be called the
“stripping activity asset”.
The stripping activity asset shall be depreciated or
amortised on a systematic basis, over the expected
useful life of the identified component of the ore
body that becomes more accessible as a result of
the stripping activity. The units of production
method shall be applied unless another method is
more appropriate.
Consequential amendments were also made to
other standards via AASB 2012‐12.
This Amendment deletes from AASB 124 individual
key management personnel disclosure
requirements for disclosing entities that are not
companies.
Interpretation
20
Stripping Costs in
the Production
Phase of a
Surface Mine
AASB 2011‐4
Amendments to
Australian
Accounting
Standards to
Remove
Individual Key
Management
Personnel
Disclosure
Requirements
[AASB 124]
‐ 42 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
Reference
Title
Summary
Application
date of
standard*
Application
date for
Group*
Annual
Improvements
2009–2012
Cycle ****
Annual
Improvements to
IFRSs 2009–2012
Cycle
This standard sets out amendments to
International Financial Reporting
1 January
2013
1 July 2013
Standards (IFRSs) and the related bases for
conclusions and guidance made during the
International Accounting Standards Board’s Annual
Improvements process. These amendments have
not yet been adopted by the AASB.
The following items are addressed by this
standard:
AASB 1 First‐time Adoption of International
Financial Reporting Standards
Repeated application of IFRS 1
Borrowing costs
AASB 101 Presentation of Financial Statements
Clarification of the requirements for
comparative information
AASB 116 Property, Plant and Equipment
Classification of servicing equipment
AASB 132 Financial Instruments: Presentation
Tax effect of distribution to holders of equity
instruments
AASB 134 Interim Financial Reporting
Interim financial reporting and segment
information for total assets and liabilities
‐ 43 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
Application
date of
standard*
Application
date for
Group*
1 July 2013
1 July 2013
Reference
Title
Summary
AASB 1053
Application of
Tiers of
Australian
Accounting
Standards
This Standard establishes a differential financial
reporting framework consisting of two Tiers of
reporting requirements for preparing general
purpose financial statements:
a) Tier 1: Australian Accounting Standards
b) Tier 2: Australian Accounting Standards –
Reduced Disclosure Requirements
Tier 2 comprises the recognition, measurement
and presentation requirements of Tier 1 and
substantially reduced disclosures corresponding to
those requirements.
The following entities apply Tier 1 requirements in
preparing general purpose financial statements:
a)
For‐profit entities in the private sector that
have public accountability (as defined in this
Standard)
b) The Australian Government and State,
Territory and Local Governments
The following entities apply either Tier 2 or Tier 1
requirements in preparing general purpose
financial statements:
a)
For‐profit private sector entities that do not
have public accountability
b) All not‐for‐profit private sector entities
c) Public sector entities other than the
Australian Government and State, Territory
and Local Governments.
Consequential amendments to other standards to
implement the regime were introduced by AASB
2010‐2, 2012‐2, 2012‐6, 2012‐11 and 2013‐1.
The adoption of these new and revised Standards and Interpretations will not have an impact on the financial position or
performance of the Group.
‐ 44 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
2.
SIGNIFICANT ACCOUNTING ESTIMATES AND ASSUMPTIONS
In applying the Consolidated Entity’s accounting policies management continually evaluates estimates and assumptions
based on experience and other factors, including expectations of future events that may have an impact on the Consolidated
Entity. All estimates and assumptions made are believed to be reasonable based on the most current set of circumstances
available to management. Actual results may differ from the estimates and assumptions. Significant estimates and
assumptions made by the management in the preparation of these financial statements are outlined below:
Significant accounting estimates and assumptions
The carrying amounts of certain assets and liabilities are often determined based on estimates and assumptions of future
events. The key estimates and assumptions that have a significant risk of causing a material adjustment to the carrying
amounts of certain assets and liabilities within the next annual reporting period are:
Impairment of capitalised exploration and evaluation expenditure
(a)
The future recoverability of capitalised exploration expenditure is dependent on a number of factors, including whether the
Consolidated Entity decides to exploit the related lease itself or, if not, whether it successfully recovers the related
exploration and evaluation asset through sale. Factors that could impact the future recoverability include the level of
reserves and resources, future technological changes, which could impact the cost of mining, future legal changes (including
changes to environmental restoration obligations) and changes to commodity prices. To the extent that capitalised
exploration and evaluation expenditure is determined not to be recoverable in the future, profits and net assets will be
reduced in the period in which this determination is made. In addition, exploration and evaluation is capitalised if activities in
the area of interest have not yet reached a stage that permits a reasonable assessment of the existence or otherwise of
economically recoverable reserves. To the extent it is determined in the future that this capitalised expenditure should be
written off, profits and net assets will be reduced in the period in which this determination is made.
Share‐based payment transactions
(b)
The Consolidated Entity measures the cost of equity‐settled transactions with employees by reference to the fair value of the
equity instruments at the date at which they are granted. The fair value is determined by an external valuer using either a
binomial or Black‐Scholes model, with the assumption detailed in Note 17. The accounting estimates and assumptions
relating to equity‐settled share‐based payments would have no impact on the carrying amount of assets and liabilities within
the next annual reporting period but may impact expenses and equity.
‐ 45 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
3. REVENUE AND EXPENSES
(Loss) after crediting the following revenues:
Other Revenues
Interest received
Foreign exchange gain
Profit on sale of investments
Loss after charging the following expenses:
Consolidated
2013
$
2012
$
40,481
9,227
‐
49,708
71,160
‐
97,830
168,990
Auditors remuneration in respect of the Audit of the financial statements
54,250
49,698
Provision for employee benefits
Operating lease payments
Superannuation
4.
INCOME TAX
The major components of income tax expenses
are:
Income Statement
Current Income Tax
Current income tax charge/(benefit)
Deferred Income Tax
Relating
temporary differences
Income tax expense/(benefit) reported in the
statement of comprehensive income
to origination and
reversal of
Operating loss before income tax
Prima facie income tax (benefit)
calculated at 30% (2012: 30%)
Non‐deductible expenses
Income tax losses carried forward/(utilised)
Research and development grant
Total income tax (expense)/benefit
(35,304)
12,811
42,560
36,501
80,898
89,416
(156,191)
‐
(156,191)
‐
‐
‐
(2,078,566)
(2,649,846)
(623,570)
(794,953)
3,328
2,387
620,247
792,566
156,191
156,191
‐
‐
Cullen Resources Limited and its 100% owned subsidiaries have entered the tax consolidation regime from 1 July
2002. The head entity of the tax consolidation group is Cullen Resources Limited.
The entity has adopted the stand alone taxpayer method for measuring current and deferred tax amounts. The
members of the income tax consolidated group have entered into a tax funding agreement.
‐ 46 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
Consolidated
Deferred Tax Liabilities
Statement of Financial
Position
Statement of Comprehensive
Income
2013
$
2012
$
2013
$
2012
$
Exploration
(1,263,486)
(1,125,587)
137,899
182,836
Deferred Tax Assets
Provisions
Accruals
Deferred tax assets used to
offset deferred tax liabilities
Net Deferred Tax Recognised
in the Statement of Financial Position
39,155
10,500
49,747
10,500
(10,592)
‐
3,843
‐
1,213,831
1,065,340
(148,491)
(178,993)
‐
‐
‐
‐
As at 30 June 2013 future income tax benefits were available to the Consolidated Entity in respect of operating
losses and prospecting and exploration expenditure incurred. The directors estimate the potential income tax
benefit at 30 June 2013 in respect of tax losses not brought to account is $13,466,335 (2012: $12,846,089) and
there is no expiry date. The benefit of these losses has only been brought to account to the extent needed to
offset deferred tax liabilities. The remaining benefit will only be obtained if:
(a)
(b)
(c)
the Consolidated Entity derives future assessable income of a nature and of sufficient amount to enable
the benefit to be realised.
the Consolidated Entity continues to comply with the conditions for deductibility imposed by the law; and
no changes in tax legislation adversely affect the Consolidated Entity in realising the benefit.
5. RECEIVABLES
Current
Other debtors
Other debtors includes GST receivable which is non‐interest bearing.
6. OTHER FINANCIAL ASSETS
Non current
Security deposits
The security deposits are non‐interest bearing and relate to mining tenements.
Consolidated
2013
$
2012
$
38,286
144,015
32,400
32,400
32,400
32,400
‐ 47 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
7. PLANT & EQUIPMENT
Plant & Equipment at cost
Accumulated depreciation
Total written down amount
(a) Reconciliation
Plant & Equipment
Carrying amount at beginning
Additions
Depreciation expense
8. EXPLORATION & EVALUATION
Costs carried forward in respect of
areas of interest in the exploration
and evaluation phase
Opening balance
Expenditure incurred during the year
Less
Impairment (a)
Closing balance net of impairment
Consolidated
2013
$
2012
$
164,153
(160,981)
3,172
161,533
(155,559)
5,974
5,974
2,619
(5,421)
3,172
11,608
‐
(5,634)
5,974
3,751,958
1,912,358
5,664,316
3,142,502
2,619,442
5,761,944
(1,452,694)
(2,009,986)
4,211,622
3,751,958
Mining tenements are carried forward in accordance with the accounting policy set out in Note 1.
The ultimate recoupment of the book value of deferred costs relating to areas of interest in the exploration and
evaluation phase is dependent upon the successful development and commercial exploitation or, alternatively, sale
of the respective areas of interest and the Consolidated Entity’s ability to continue to meet its financial obligations to
maintain the areas of interest.
(a) Impairment
The directors have reviewed all exploration projects for indicators of impairment in light of approved budgets.
Where substantive expenditure is neither budgeted nor planned the area of interest has been written down to its
fair value less costs to sell. In determining fair value less costs to sell the directors had regard to the best evidence of
what a willing participant would pay in an arms length transaction. Where no such evidence was available, areas of
interest were written down to nil pending the outcome of any future farm‐out arrangement. The Company will
continue to look to attract farm‐in partners and/or recommence exploration should circumstances change.
9. TRADE AND OTHER PAYABLES
Current
Trade creditors ‐ unsecured
108,266
814,465
Trade creditors are non‐interest bearing and are normally settled on 30 day terms.
‐ 48 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
10. PROVISIONS
Current
Employee benefits
Non Current
Employee benefits
11. CONTRIBUTED EQUITY
Issued capital
818,389,431 ordinary shares
(2012: 693,089,431)
Movement in issued shares for the year:
Beginning of the financial year:
Issued at 3.00 cents each (i)
Issued at 2.0 cents each (ii)
Issued at 2.20 cents each (i)
Less share issue expenses
End of financial year:
Consolidated
2013
$
2012
$
103,917
143,597
26,602
22,226
39,201,266
36,605,266
2013
2012
Number of
Shares
693,089,431
‐
25,300,000
100,000,000
‐
818,389,431
$
Number of
$
36,605,266
‐
506,000
2,200,000
(110,000)
39,201,266
Shares
623,089,431
70,000,000
‐
‐
‐
693,089,431
34,610,266
2,100,000
‐
‐
(105,000)
36,605,266
Ordinary shares have the right to receive dividends as declared and, in the event of winding up the company, to
participate in the proceeds from the sale of all surplus assets in proportion to the number of and amounts paid
upon shares held.
Ordinary shares entitle their holder to one vote, either in person or by proxy, at a meeting of the company.
(i) Issued under a placement.
(ii) Issued under a Share Purchase Plan.
Options
As at 30 June 2013 there are 22,000,000 (2012: 22,000,000) unissued shares in respect of which options were
outstanding and the details of these are as follows:
Number
Grant Date
Vesting Date
16,000,000
6,000,000
22,000,000
1/12/10
14/03/11
1/12/10
14/03/11
Exercise
Price
0.075
0.060
Expiry Date
30 November 2013
13 March 2014
The options have no rights until they are exercised and become ordinary shares.
During the year nil (2012: nil) options lapsed.
During the year Nil (2012: nil) options were issued.
Since the end of the financial year no shares have been issued by virtue of the exercise of options.
‐ 49 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
12. SHARE BASED PAYMENT RESERVE
The share based payment reserve represents the cost of share‐based payments to directors, employees and
third parties.
Share based payment reserve
There was no movement during the year
13. AVAILABLE FOR SALE RESERVE
This relates to the movement in the fair valuation of available
For sale financial assets.
Beginning of the financial year
Release of unrealised loss reserve due to impairment
End of financial year
14. ACCUMULATED LOSSES
Accumulated losses at the beginning of the year
Net (loss)
Accumulated losses at the end of the year
Consolidated
2013
$
1,280,125
2012
$
1,280,125
‐
‐
‐
(20,000)
20,000
‐
(32,472,092)
(2,078,566)
(34,550,658)
(29,822,246)
(2,649,846)
(32,472,092)
15. PARTICULARS IN RELATION TO CONTROLLED ENTITIES
The consolidated financial statements at 30 June 2013 include the following controlled entities. The financial
years of all controlled entities are the same as that of the parent entity.
Place of
Incorporation
Interest
%
Investment
$
Name
June
2013
June
2012
Cullen Minerals Pty Limited
Cullen Exploration Pty Ltd
Montrose Resources Pty Limited
Red Dirt Resources Pty Ltd
Bearmark Investments Pty Ltd
Cullen Resources Namibia Pty Ltd
Cullen Exploration Inc.
ARCTEX OY
ARCTEX AB
Australia
Australia
Australia
Australia
Botswana
Namibia
Canada
Finland
Sweden
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
June
2013
‐
‐
1
1
‐
15
1
4,072
7,915
June
2012
‐
‐
1
1
‐
15
1
4,072
7,915
‐ 50 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
16. KEY MANAGEMENT PERSONNEL
(a)
Compensation for key management personnel
Short‐term employee benefits
Post‐employment benefits
Other long‐term benefits
Termination benefits
Share‐based payments
Total compensation
(b)
Option holdings of directors
Consolidated
2013
$
2012
$
449,811
35,100
(18,500)
‐
‐
466,411
528,611
36,000
8,208
‐
‐
572,819
Balance at
beginning of
year 1 July 2012
Number
Options
issued
Number
Options
lapsed
Number
2,000,000
8,000,000
2,000,000
2,000,000
2,000,000
16,000,000
‐
‐
‐
‐
‐
‐
Balance at end
of year
30 June 2013
Number
2,000,000
8,000,000
2,000,000
2,000,000
2,000,000
Vested and
exercisable at
30 June 2013
Number
2,000,000
8,000,000
2,000,000
2,000,000
2,000,000
Total
Number
2,000,000
8,000,000
2,000,000
2,000,000
2,000,000
16,000,000
16,000,000
16,000,000
‐
‐
‐
‐
‐
‐
Directors
D Clarke
C Ringrose
G Hamilton
J Horsburgh
W Kernaghan
Total
The outstanding options are exercisable at $0.075 and have an expiry date of 30 November 2013.
These options had a weighted average exercise price of $0.075 and a weighted average remaining contractual
life of 0.42 years.
Balance at
beginning of
year
1 July 2011
Number
2,000,000
8,000,000
2,000,000
2,000,000
2,000,000
16,000,000
Directors
D Clarke
C Ringrose
G Hamilton
J Horsburgh
W Kernaghan
Total
Options
issued
Number
Options
lapsed
Number
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
Balance at end
of year
30 June 2012
Number
2,000,000
8,000,000
2,000,000
2,000,000
2,000,000
16,000,000
Vested and
exercisable at
30 June 2012
Number
2,000,000
8,000,000
2,000,000
2,000,000
2,000,000
16,000,000
Total
Number
2,000,000
8,000,000
2,000,000
2,000,000
2,000,000
16,000,000
The outstanding options are exercisable at $0.075 and have an expiry date of 30 November 2013.
These options had a weighted average exercise price of $0.075 and a weighted average remaining contractual
life of 1.42 years.
‐ 51 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
(c)
Shareholdings of directors
Directors
D Clarke
C Ringrose
G Hamilton
J Horsburgh
W Kernaghan
Total
Directors
D Clarke
C Ringrose
G Hamilton
J Horsburgh
W Kernaghan
Total
Balance
1 July 2012
Number
4,614,000
200,000
15,141,004
16,702,124
3,623,376
40,280,504
Balance
1 July 2011
Number
3,383,000
200,000
15,141,004
16,103,124
3,333,000
38,160,128
Options
Exercised
Number
‐
‐
‐
‐
‐
‐
Options
Exercised
Number
‐
‐
‐
‐
‐
‐
Net Change
Purchase
Number
750,000
750,000
750,000
750,000
750,000
3,750,000
Net Change
Purchase
Number
1,231,000
‐
‐
599,000
290,376
2,120,376
Balance
30 June 2013
Number
5,364,000
950,000
15,891,004
17,452,124
4,373,376
44,030,504
Balance
30 June 2012
Number
4,614,000
200,000
15,141,004
16,702,124
3,623,376
40,280,504
The directors' shareholdings are held directly and indirectly. Refer to the Directors' Report on page 20 for the
breakdown.
17. SHARE BASED PAYMENTS
(a)
Recognised share based payment expenses
Director options
Employee options
(b)
(i)
Employee Options
Options held at the beginning of the reporting period
Number
Grant Date
Vest Date
Expiry Date
2013
$
2012
$
‐
‐
‐
‐
‐
‐
Weighted
Average
Exercise Price
6,000,000
14/3/11
14/3/11
13/3/14
$0.06
(ii)
Options lapsed / exercised during the year
Number
Grant Date
‐
‐
Exercise
Date
‐
Exercise
Price
‐
Number
Lapsed
‐
‐ 52 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
(iii)
Options issued during the year
Number
Grant Date
Vest Date
Expiry Date
‐
‐
‐
‐
(iv)
Options held at the end of the reporting period
Number
Grant Date
Vest Date
Expiry Date
Weighted
Average
Exercise
Price
‐
Exercise
Price
6,000,000
14/3/11
14/3/11
13/3/14
$0.06
Weighted
Average
Share Price
‐
Weighted Average
Fair Value
of Options
$0.0216
These options had a weighted average exercise price of $0.06 and a weighted average remaining contractual
life of 0.75 years.
The fair value of the equity settled share options granted are estimated as at the date of allocation using a
Binomial Model taking into account the terms and conditions upon which they were granted.
(v)
Valuation of options issued during the year
Number
Grant Date
Vest Date
Expiry Date
Exercise
Price
‐
‐
‐
‐
‐
Weighted Average
Fair Value
of Options
‐
(c)
Weighted average remaining contractual life
Options ‐ Employee
Options ‐ Directors
(d)
Range of exercise prices
Options ‐ Employee
Options ‐ Directors
(e)
Weighted average fair value at date of issue
2013
Years
0.75
0.42
2013
$
0.06
0.075
2013
$
2012
Years
1.75
1.42
2012
$
0.06
0.075
2012
$
Options ‐ Employee
Options ‐ Directors
0.0216
0.0277
0.0216
0.0277
‐ 53 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
Option pricing model
(f)
The fair value of the equity settled share options granted are estimated as at the date of allocation using a
Binomial Model taking into account the terms and conditions upon which they were granted.
The following table lists the inputs to the models used at the date of allocation for employee options:
Dividend yield
Expected volatility
Risk free interest rate
Exercise price
Share price at measurement date
2013
2012
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
The following table lists the inputs used at the date of allocation for directors’ options:
Dividend yield
Expected volatility
Risk free interest rate
Exercise price
Share price at measurement date
18. JOINT VENTURES
2013
2012
‐
‐
‐
‐
‐
‐
‐
‐
‐
‐
The Consolidated Entity has interests in the following jointly controlled assets:
Principal Activity
Other Participant
(a) Hardey Junction
Exploration
Northern Star Resources Ltd (Northern Star)
(b) Mt Stuart
Exploration
Australian Premium Iron Management Pty Limited (API)
(c) Wyloo
Exploration
Fortescue Mining Group Limited (Fortescue)
(d) Tunnel Creek/Saltwater Pool
Exploration
Avocet Resources Limited now Lion One Metals Limited
(e) Paraburdoo
Exploration
Fortescue Mining Group Limited (Fortescue)
(f) Forrestania
Exploration
Hannans Reward Limited (Hannans)
(g) Killaloe
Exploration
Matsa Resources Limited (Matsa)
(h) TL Property, Canada
Exploration
TL Syndicate
a)
b)
c)
d)
e)
f)
Northern Star has an 80% interest, Cullen is 20% free carried.
API has earned a 70% interest in the iron ore rights and Cullen is contributing at 30% for its interest.
Fortescue can earn up to 80% in the iron ore rights.
Avocet/ Lion Ore Metals can earn 70%.
Fortescue can earn up to 80% in the iron ore rights.
Hannans has an 80% interest; Cullen is 20% free carried.
g) Matsa has earned a 80% interest; Cullen is 20% free carried.
h)
Cullen can earn 80%.
‐ 54 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
The joint venture assets are not separate legal entities. They are contractual arrangements between the participants for the
sharing of costs and any outputs and do not, in themselves, generate revenue and profit. The net contribution of any joint
venture activities to the operating profit before income tax is $Nil (2012: $Nil). The Consolidated Entity’s assets employed in
the joint ventures, are included in the balance sheet of the Consolidated Entity as follows:
Current Assets
Receivables
Non‐Current Assets
Exploration and expenditure
Current Liabilities
Trade and other payables
19. COMMITMENTS
(a) Minimum exploration work
Consolidated
2013
$
2012
$
233
83,331
4,211,349
3,655,754
14,510
55,518
The Consolidated Entity has certain obligations to perform minimum exploration work and expend minimum amounts of
money on mineral exploration tenements. The Consolidated Entity has committed to expend a minimum of $1,878,980
(2012: $2,302,380) over the next year to keep its current tenements in good standing. Approximately 68% (2012: 68%) of
this expenditure will be met by our Joint Venture partners.
(b) Joint Venture commitment
The Consolidated Entity has certain obligations in respect to the Mt Stuart JV and maybe required to expend further funds
over the next year being its share of the joint venture expenditure.
(c) Lease expenditure commitments
Lease expenditure commitment
Operating leases (non‐cancellable) for premises
Minimum lease payments
‐
‐
not later than one year
later than one year and not later than five years
Aggregate lease expenditure contracted for at reporting
date but not provided for
Consolidated
2013
$
2012
$
25,137
‐
41,616
24,276
25,137
65,892
This lease for the premises is for the period 1 February 2010 to 31 January 2014 with an option for a further five years.
There are no contingent rentals or restrictions imposed by the lease arrangements.
‐ 55 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
20. RELATED PARTIES
Payments to director related companies
Transactions between related parties are on normal commercial terms and conditions no more favourable than those
available to other parties unless otherwise stated.
Geological payments were made to Weeroona Investments Pty Ltd totalling $14,850 (2012: $80,775) which is a company
controlled by Mr G Hamilton. There were no amounts outstanding at 30 June 2013. Consultancy payments were made to
Mosman Corporate Services Pty Ltd totalling $38,125 (2012: $41,000) which is a company controlled by Mr W Kernaghan.
There was $2,220 outstanding at 30 June 2013.
21. OPERATING SEGMENTS
Identification of Reportable Segments
The Consolidated Entity has based its operating segment on the internal reports that are reviewed and used by the executive
management team in assessing performance and in determining the allocation of resources.
The Consolidated Entity currently does not have production and is only involved in exploration. As a consequence, activities
in the operating segment are identified by management based on the manner in which resources are allocated, the nature of
the resources provided and the identity of the manager and country of expenditure. Discrete financial information about
each of these areas is reported to the executive management team on a monthly basis.
Based on this criteria, the Consolidated Entity has only one operating segment, being exploration, and the segment
operations and results are the same as the Consolidated Entity’s results.
Non Current Assets by Geographical regions:
Australia
Namibia
Canada
22. STATEMENT OF CASH FLOWS
Consolidated
2013
$
2012
$
4,244,794
‐
2,400
4,247,194
3,718,044
‐
72,288
3,790,332
(i) Reconciliation of cash
For the purposes of the Consolidated Statement of Cash Flows, cash includes cash at bank and short term deposits at call.
Cash at the end of the financial year as shown in the Consolidated Statement of Cash Flows is reconciled to the related items
in the Consolidated Statement of Financial Position as follows:
Cash on hand
(ii) Reconciliation of operating (loss)
after income tax to net cash used in operating activities
Operating (loss) after income tax
Add/(less) non cash items
Profit on sale of investment
Impairment of available for sale assets
Depreciation
Share based payments
Provisions for employee benefits
Impairment exploration expenditure
(Decrease) / Increase in trade and other payables
Decrease / (Increase) in receivables
Net operating cashflows
‐ 56 ‐
Consolidated
2013
$
2012
$
1,884,038
2,459,240
(2,078,566)
(2,649,846)
‐
‐
5,421
‐
(35,304)
1,452,694
(706,199)
105,729
(97,830)
13,155
5,634
‐
12,811
2,009,986
619,649
(74,859)
(1,256,225)
(161,300)
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
Share based payments
During the year the Consolidated Entity made share based payments of $Nil (2012: $Nil) to directors and employees of
the Consolidated Entity.
23. EARNINGS/(LOSS)PER SHARE
Basic (loss) per share (cents per share)
Diluted (loss) per share (cents per share)
The following reflects the income and share data used
in the calculations of basic and diluted (loss) per share
Net (loss)
Weighted average number of ordinary shares used in
the calculation of basic and diluted earnings per share
Options on issue at year end are not dilutive and hence
not used in the calculation of diluted EPS
Consolidated
2013
2012
(0.28)
(0.28)
(0.41)
(0.41)
(2,078,566)
(2,649,846)
739,383,404
642,459,294
22,000,000
22,000,000
There are no instruments (e.g. share options) excluded from the calculation of diluted earnings per share that could
potentially dilute basic earnings per share in the future because they are antidilutive for either of the periods presented.
24. FINANCIAL INSTRUMENTS
The Group's financial instruments comprise receivables, payables, and cash and short‐term deposits.
The Group manages its exposure to key financial risks, including interest rate risk in accordance with the Group's financial risk
management policy. The objective of the policy is to support the delivery of the Group's financial targets whilst protecting
future financial security.
The Board reviews and agrees policies for managing each of these risks as summarised below.
Primary responsibility for identification and control of financial risks rests with the Board of Directors. Due to the size and
nature of the company's operations, and as the company does not use derivative instruments or debt, the directors do not
believe the establishment of a risk management committee is warranted.
Interest Rate Risk
(a)
The Group's exposure to market interest rates relates primarily to the Group's cash and cash equivalents.
The Group's exposure to interest rate risk for each class of financial assets and financial liabilities is set out below.
Consolidated
Floating
interest rate
Floating
interest rate
2013
$
2012
$
1,884,038
2,459,240
1,884,038
2,459,240
Financial Instruments
Financial Assets
Cash and cash equivalents
Total Financial Assets
Cash gives rise to interest rate risk because the interest rate is variable.
‐ 57 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
The following summarises the effect on loss and equity of financial instruments held at balance date as a result of a 1%
movement in interest rates, with all other variables remaining constant.
Interest rate +1%
Interest rate ‐1%
Consolidated
2013
$
(18,840)
18,840
2012
$
(24,592)
24,592
The selection of 1% sensitivity check was based on recent interest rate adjustments.
(b) Currency Risk
The Consolidated Entity has limited exposure to foreign currency risk as it pays for its overseas exploration activities from
Australia in various overseas currencies.
(c) Credit Risk
Credit risk arises from the financial assets of the Consolidated Entity, namely trade and other receivables. The Consolidated
Entity's exposure to credit risk arises from potential default of the counter party, with a maximum exposure equal to its
carrying amount. Exposure at balance date is addressed in each applicable note.
The Consolidated Entity does not hold any credit derivatives to offset its credit exposure.
Receivable balances are monitored on an ongoing basis with the result that the Consolidated Entity's exposure to bad debts is
not significant.
There are no significant concentrations of credit risk within the Consolidated Entity and cash and cash equivalents are spread
amongst two of the big four Australian Banks.
(d) Liquidity Risk
The liquidity position of the Consolidated Entity is managed to ensure sufficient liquid funds are available to meet the
Consolidated Entity's financial commitments in a timely and cost‐effective manner. The Consolidated Entity funds its activities
through capital raisings in order to limit its liquidity risk which is monitored on a monthly basis.
Contractual maturity of the trade payables is within 30 day terms.
The Consolidate Entity manages its liquidity risk by monitoring the total cash inflows and outflows expected on a monthly basis.
The Consolidated entity has established comprehensive risk reporting covering its business units that reflect expectations of
management of the expected statement of financial assets and liabilities.
(e) Capital Management
Management controls the capital of the Consolidated Entity in order to provide the shareholders with adequate returns and
ensure that the group can fund its operations and continue as a going concern.
There are no externally imposed capital requirements.
Management effectively manages the group's capital by assessing the Consolidated Entity's financial risks and adjusting its
capital structure in responses to include the management of debt levels, distributions to shareholders and share issues.
The Consolidated Entity uses cash flow forecasts to manage and adjust its capital management.
There have been no changes in the strategy adopted by management to control the capital of the Consolidated Entity since the
prior year.
Capital managed by the Consolidated Entity consists of shareholders equity.
Shareholders equity
‐ 58 ‐
Consolidated
2013
$
2012
$
5,930,733
5,413,299
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
25. AUDITOR'S REMUNERATION
Amounts received or due and receivable
by Ernst and Young
‐
‐
an audit or review of the financial report
of the entity and any other entity in the
Consolidated Entity
taxation services provided to the Consolidated Entity
26. PARENT ENTITY INFORMATION
Information relating to Cullen Resources Limited.
Current assets
Total assets
Current liabilities
Total liabilities
Issued capital
Accumulated losses
Share based payment reserve
Total shareholders' equity
Loss of the parent entity
Total comprehensive income of the parent entity
Consolidated
2013
$
2012
$
54,250
2,000
49,698
17,650
2013
$
2012
$
1,609,295
5,995,280
52,660
52,660
39,201,266
34,538,771
1,280,125
5,942,620
2,324,315
2,324,315
1,653,281
5,735,616
64,681
64,681
36,605,266
32,214,456
1,280,125
5,670,935
2,446,207
2,446,207
The parent entity has no contingent liabilities, nor does it have any contractual commitments for the acquisition of property,
plant or equipment.
27. SUBSEQUENT EVENTS
There has not arisen in the interval between the end of the financial year and the date of this report any item, transaction or
event of a material and unusual nature likely, in the opinion of the directors, to affect the operations of the Consolidated
Entity, the results of those operations or the state of affairs of the Consolidated Entity in the subsequent financial years.
28. CORPORATE INFORMATION
The financial report of Cullen Resources Limited for the year ended 30 June 2013 was authorised for issue in accordance with
a resolution of the directors on 13 September 2013.
Cullen Resources Limited is a company limited by shares incorporated in Australia whose shares are publicly traded on the
Australian Stock Exchange.
‐ 59 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
DIRECTORS' DECLARATION
In accordance with a resolution of the directors of Cullen Resources Limited, I state that:
In the opinion of the directors:
(a)
the financial statements and notes of the Consolidated Entity are in accordance with the
Corporations Act 2001, including:
(i) giving a true and fair view of the Consolidated Entity’s financial position as at 30 June 2013
and of its performance for the year ended on that date; and
(ii) complying with Australian Accounting Standards (including the Australian Accounting
Interpretations) and the Corporations Regulations 2001; and
the financial statements and notes also comply with International Financial Reporting Standards as
disclosed in Note 1(b).
there are reasonable grounds to believe that the Consolidated Entity will be able to pay its debts
as and when they become due and payable.
this declaration has been made after receiving the declaration required to be made to the
directors in accordance with section 295A of the Corporations Act 2001 for the financial year
ending 30 June 2013.
(b)
(c)
(d)
On behalf of the Board
C. Ringrose
Director
Perth, WA
16 September 2013
‐ 60 ‐
Ernst & Young
11 Mounts Bay Road
Perth WA 6000 Australia
GPO Box M939 Perth WA 6843
Tel: +61 8 9429 2222
Fax: +61 8 9429 2436
ey.com/au
Independent audit report to members of Cullen Resources Limited
We have audited the accompanying financial report of Cullen Resources Limited, which comprises the
consolidated statement of financial position as at 30 June 2013, the consolidated statement of
comprehensive income, consolidated statement of changes in equity and consolidated statement of cash
flows for the year then ended, notes comprising a summary of significant accounting policies and other
explanatory information, and the directors' declaration of the consolidated entity comprising the company
and the entities it controlled at the year's end or from time to time during the financial year.
Directors' responsibility for the financial report
The directors of the company are responsible for the preparation of the financial report that gives a true
and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for
such internal controls as the directors determine are necessary to enable the preparation of the financial
report that is free from material misstatement, whether due to fraud or error. In Note 2, the directors also
state, in accordance with Accounting Standard AASB 101 Presentation of Financial Statements, that the
financial statements comply with International Financial Reporting Standards.
Auditor's responsibility
Our responsibility is to express an opinion on the financial report based on our audit. We conducted our
audit in accordance with Australian Auditing Standards. Those standards require that we comply with
relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain
reasonable assurance about whether the financial report is free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in
the financial report. The procedures selected depend on the auditor's judgment, including the assessment
of the risks of material misstatement of the financial report, whether due to fraud or error. In making
those risk assessments, the auditor considers internal controls relevant to the entity's preparation and fair
presentation of the financial report in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's
internal controls. An audit also includes evaluating the appropriateness of accounting policies used and
the reasonableness of accounting estimates made by the directors, as well as evaluating the overall
presentation of the financial report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
audit opinion.
Independence
In conducting our audit we have complied with the independence requirements of the Corporations Act
2001. We have given to the directors of the company a written Auditor’s Independence Declaration, a
copy of which is included in the directors’ report.
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
PM:DR:CULLEN:016
Opinion
In our opinion:
a.
the financial report of Cullen Resources Limited is in accordance with the Corporations Act
2001, including:
i
ii
giving a true and fair view of the consolidated entity's financial position as at 30 June
2013 and of its performance for the year ended on that date; and
complying with Australian Accounting Standards and the Corporations Regulations
2001; and
b.
the financial report also complies with International Financial Reporting Standards as
disclosed in Note 1.
Material Uncertainty Regarding Continuation as a Going Concern
Without qualifying our opinion, we draw attention to the basis of preparation paragraph in Note 1 to the
financial report. As a result of these matters there is significant uncertainty whether the consolidated
entity will continue as a going concern, and therefore whether it will realise its assets and extinguish its
liabilities in the normal course of business and at the amounts stated in the financial report. The financial
report does 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 consolidated
entity not continue as a going concern.
Report on the remuneration report
We have audited the Remuneration Report included in the directors' report for the year ended 30 June
2013. 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.
Opinion
In our opinion, the Remuneration Report of Cullen Resources Limited for the year ended 30 June 2013,
complies with section 300A of the Corporations Act 2001.
Ernst & Young
P McIver
Partner
Perth
16 September 2013
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
PM:DR:CULLEN:016
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
SHAREHOLDER INFORMATION
CAPITAL STRUCTURE
As at 13 September 2013, the company had the following securities on issue:
Issued Capital
Top 20 Shareholders
Total holding of twenty largest shareholders
% of total shares on issue
Distribution of shareholders
1 ‐ 1,000 shares
1,001 ‐ 5,000 shares
5,001 ‐ 10,000 shares
10,001 ‐ 100,000 shares
100,001 and over
Total
Unmarketable Parcels as at 13 September 2013
Minimum $500.00
Fully paid
Ordinary shares
818,389,431
338,920,221
41.41%
160
190
404
1,686
690
3,130
1,100
OPTIONS
As at 13 September 2013, 22,000,000 unissued shares in respect of options were outstanding.
These are as follows:
Number
16,000,000
6,000,000
Exercise Price
Expiry Date
$0.075
$0.06
30 November 2013
13 March 2014
SUBSTANTIAL SHAREHOLDERS
The company has three Substantial Shareholders as at 13 September 2013
Name
Brisbane Investments I and II
Mende and Kundrun
Aquila Resources Ltd
Wythenshawe & Associates
Pty Ltd
%
6.22
12.81
11.52
No. of shares
50,822,699
104,843,426
94,253,538
‐ 63 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2013
TWENTY LARGEST SHAREHOLDERS
The names of the twenty holders of the fully paid shares at 13 September 2013 are listed below:
Name
Penoir Pty Ltd
Glyde Street Nominees Pty Ltd
Wythenshawe Pty Ltd
Brisbane Investments I Ltd
Brisbane Investments II Ltd
Kitchsmith Pty Ltd
Warramboo Holdings Pty Ltd
Wythenshawe Pty Ltd
Innerleithen Pty Ltd
Bellarine Gold Pty Ltd
HSBC Custody Nominees (Australia) Limited
Aquila Resources Limited
Chiatta Pty Ltd
A N Superannuation Pty Ltd
BT X Pty Ltd
Adrian Darby Investments Pty Ltd
First Farley Pty Ltd
Mr Parmjit Singh
Penoir Pty Ltd
Lindglade Enterprises Pty Ltd
Total
No. of Shares
% Held
Rank
72,000,000
33,000,000
28,137,000
25,411,350
25,411,349
15,438,002
15,250,000
14,757,698
14,034,120
12,142,200
12,027,776
11,846,603
11,360,000
9,000,000
8,500,000
7,750,000
6,000,000
5,800,000
5,690,123
5,364,000
8.80
4.03
3.44
3.11
3.11
1.89
1.86
1.80
1.71
1.48
1.47
1.45
1.39
1.10
1.04
0.95
0.73
0.71
0.70
0.66
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
338,920,221
41.41
VOTING RIGHTS
Every member present in person or by representative shall on a show of hands have one vote, and on a poll
every member present in person or by representative, proxy or attorney shall have one vote in respect of each
fully paid share held by him.
‐ 64 ‐
C U L L E N
R E S O U R C E S L I M I T E D
Registered and Principal Office
Unit 4
7 Hardy Street
South Perth WA 6151
Telephone (08) 9474 5511
Facsimile (08) 9474 5588
Website: www.cullenresources.com.au
Email: cullen@cullenresources.com.au