Dotz Nano Limited Annual Report 2014

FY2014 Annual Report · Dotz Nano Limited
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Annual Report 2014Year ended 31 December 2014Chairman’s Review 03Operating Review 05Signiﬁcant Accomplishments 14Financial Report 15Directors’ Report 16Auditor’s Independence Declaration 29Consolidated Statement  of Comprehensive Income 30Consolidated Statement  of Financial Position 31Consolidated Statement  of Changes in Equity 32Consolidated Statement  of Cash Flows 33Notes to the Financial Statements 34Directors’ Declaration 75Independent Auditor’s Report 76Corporate Governance Statement 78Additional Shareholder Information  90Corporate Directory 97ContentsNorthern Iron is an Australian listed company which is the 100% owner of Sydvaranger Gruve AS, a producer of high quality magnetite iron concentrate in Northern Norway. Sydvaranger uses world class mining, rail, processing and port assets to produce and export high quality iron ore concentrate to steel industry customers worldwide.Northern Iron Limited Level 1, 44 Ord Street West Perth, WA 6005Northern Iron Annual Report 2014Signiﬁcant 
accomplishments 
in 2014 included:

 Sales of 2,385,000 dry metric tonnes of iron ore 

concentrate, a 24% increase over the prior year 
Production of 2,342,000 dry metric tonnes of iron 
ore concentrate, an 18% increase over the prior year 
 Unit cash operating costs (C1) of approximately 
US$72/dmt, an improvement of 20% over the prior 
year result of US$90/dmt 
production result of 623kt of dry concentrate during 
 Record monthly production 
the June 2014 quarter 
of 222kt of dry concentrate production in May 2014 
 Improved processing and ﬁne crushing reliability 
with increased run time due to the implementation 
of planned shutdowns in quarter four of 2013.

 A record quarterly 

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01

 
 
 
 
 
increase in ore minedcompared to 201314%02Northern Iron Annual Report 2014Chairman’s Review

The Company continued to improve 
the reliability, stability and productivity 
of its operations over the course of 
the year.

Dear Shareholder, 
The market conditions during the 2014 year were 
extremely volatile, with an oversupply situation 
in the iron ore market developing dramatically in 
the second half of the year. As a consequence, the 
market price for iron ore has collapsed both quickly 
and precipitously, falling by more than 50% across 
the year. Further, due to the recent strengthening of 
the US$ to NOK there has been a material negative 
inﬂuence on the 2014 result for the Company 
due to a mark-to-market loss on foreign currency 
transactions maturing during 2015 and 2016.

Signiﬁcant effort has been applied towards 
preserving cash, reducing costs and securing 
ﬁnancial support. Progress has been achieved on 
these measures and the Company continues to 
actively work with key stakeholders to restructure 
and improve the working capital and overall 
operating position of the Company for the longer 
term to ensure the operations continue as a going 
concern. The support received from the Company’s 
ﬁnanciers and main offtake partner, as announced by 
the Company on 25 March 2015, is an endorsement 
of the strong backing enjoyed from key stakeholders.

The Company continued to improve the reliability, 
stability and productivity of its operations over the 
course of the year, with a strong focus on safety 
and improvements to operational competency and 
particularly cost reduction. This planned approach 
has been developed with the acknowledgement that 
our business is our people and that people get things 
done. These achievements are closely aligned to our 
values and engaged behaviours.

Signiﬁcant accomplishments in 2014 included: 
 – Sales of 2,385,000 dry metric tonnes of iron ore 
concentrate, a 24% increase over the prior year
 – Production of 2,342,000 dry metric tonnes of 
iron ore concentrate, an 18% increase over the 
prior year

 – Unit cash operating costs (C1) of approximately 
US$72/dmt, an improvement of 20% over the 
prior year result of US$90/dmt

 – A record quarterly production result of 623kt 

of dry concentrate during the June 2014 quarter

 – Record monthly production of 222kt of dry 

concentrate production in May 2014
 – Improved processing and ﬁne crushing 

reliability with increased run time due to the 
implementation of planned shutdowns in quarter 
four of 2013.

Safety performance improved year-on-year with 
7 Lost Time Injuries being experienced versus 9 in 
2013. We remain committed to further improvement 
in safety during the coming year which is a key 
business driver of reliability, productivity and overall 
operational success. 

Looking ahead, the Company will continue to actively 
institute measures toward further cost reductions, 
improvements in efficiency as well as furthering 
the discussions with stakeholders with the aim of 
strengthening the Company’s ﬁnancial position and 
delivering a long term sustainable solution. 

I would like to thank our stakeholders, including 
the local Kirkenes community, employees, customers 
and business partners for their continuing support 
during what has been a year that has seen both 
operational success and ﬁnancial challenges, with 
further price falls during the ﬁrst quarter 2015 
and the iron ore price now at 6 year lows.

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Peter Bilbe 
Chairman

03

 
 
 
 
increase in concentrate productioncompared to 201318%04Northern Iron Annual Report 2014Operating Review

Substantial progress has been made 
over the last 2 years to stabilise 
operations and align daily activities 
to strategic business drivers.

This approach has been fundamental to the 
demonstrated success of the Company during 
this period. During 2014 new quarterly and annual 
records were set for total ore mined, crushed tonnes, 
ore milled and both concentrate produced and 
shipped. In the current price environment challenges 
remain and the company continues to focus and 
work hard on improving the operational cost proﬁle 
whilst maintaining a stable and safe operation.

Safety Performance 
Safety performance challenges from 2013 have 
improved in 2014. The number of Total Recordable 
Injuries (“TRI”) has decreased and Sydvaranger 
Gruve AS (“SVG”) has a good understanding 
of the underlying aspects of the injuries. Table 1 
summarises the number of injuries experienced 
in 2014 versus 2013.

Table 1

Lost Time Injury (LTI)

Restricted work cases (RWC) 

Medical Treatments (MTC)

First Aid (FAC)

TRIFR(i)

2014

2013

7

1

6

30

14

9

1

5

24

15

(i) 

 TRIFR: Total Recordable Injuries Frequency Rate is the TRI 
divided per million annual actual work hours. TRI includes LTI, 
RWC and MTC (excludes FAC).

In 2014 the Company updated the Health, Safety, 
Environment and Quality (“HSEQ”) policies. 
The updated policy is signed by the CEO Ismo 
Haaparanta. The new policy focuses on zero harm 
and that tasks will not be performed unless all risk 
controls are active. The policies were reviewed and 
approved by the SVG and NFE boards.

The Company set a TRIFR target for 2014 of 
less than 10. The result is 14 incidents which sets 
the incident rate at 13.25. None of the incidents 
involved serious injury. A considerable number 
of the incidents, especially the LTIs, involved 
subcontractors. An immediate action is to involve 
subcontractors more in HSE work to improve the 
safety performance. 

A focus has been set up to reinforce the Health, 
Safety and Environment (“HSE”) programs. The 
Walk, Observe, Communicate (“WOC”) procedure 
has been changed to assist the focus on creating 
a HSE culture through conversation and observing 
positive aspects in the HSE work. Regular toolbox 
meetings have been introduced at the plant and 
mine areas. The general reaction is positive among 
the workforce. The safety walk program run by the 
safety representatives has been followed up more 
closely resulting in almost 100% execution of the 
program. The quality of the safety walks has also 
improved along with the closure of ﬁndings. 

Working Environment Committee (WEC) meetings 
have been held regularly and the WEC continues to 
improve its function as the mandatory Health, Safety 
and Environment part of the business.

The cooperation with the local occupational health 
service has improved. A cooperation agreement 
has been made for the year 2015. A survey on 
underlying causes of sick leave was conducted by 
the service. The service interviewed a selection of 
the workforce in the mine to perform the survey. 
A report was made with recommendations. The 
major recommendation is to introduce consistent 
leader-employee dialog meetings in order to improve 
the working environment which greatly affects the 
sick leave rate.

A HSEQ steering committee was established in 
the year 2014. The purpose of the committee is to 
review safety performance and provide strategic 
guidance on improving the performance. A major 
conclusion from this ﬁrst meeting was to analyse the 
functionality of the incident and non-conformance 
reporting system. 

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05

 
 
 
 
Operating Review

Continued

This year the Company has updated 
its Environmental Policy, and worked 
continuously towards fulﬁlling the 
objectives of the Policy.

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Environmental Performance
This year the Company has updated its 
Environmental Policy, and worked continuously 
towards fulﬁlling the objectives of the Policy:

The Company will build a sustainable future by 
preventing or otherwise minimising harmful effects 
on the environment at all levels in its business.

Environmental sustainability will be achieved by 
complying with laws, regulations and permits, 
developing and implementing internationally 
recognised environmental management systems. 

It is our aim to enhance environmental 
performance by working closely with our 
community in the Sør-Varanger municipality, our 
business partners and employees, by increasing 
environmental awareness and by establishing 
monitoring and controls.

Awareness
The community liaison group established in 2010 had 
a total of 3 meetings in 2014. Key topics of interest 
were; environmental monitoring; the toxicity testing 
of the ﬂocculants; noise generation; dust from the 
mining operation, water levels in the Kirkenes lakes, 
plans for expanding production and the application 
for amended emission permit. 

Monitoring
The Company’s permanent monitoring program 
for discharges and runoff from the mining areas 
revealed no breaches of the relevant permits.

In response to several noise complaints from 
residents in Kirkenes, new noise measurements were 
conducted this summer. The measures conﬁrmed 
that the source of the noise had been correctly 
identiﬁed and that the actions taken to mitigate the 
noise were effective. 

In 2014, dust from the mining operation continued 
to be an issue in Bjørnevatn, even with intensiﬁed 
watering of roads and rock piles. The legal limit 
for mineral fall out dust from mining in Norway is 
5g/m2/30 days, measured at the nearest home. 
The company started measuring fall out dust at 
four locations in March. The dust measurements are 
done by NTNU (Norwegian University of Science 
and Technology) and will continue for 12 months. 
Measuring station 1 which was initially located by 

06

Northern Iron Annual Report 2014

the ship loading facilities is now moved to the town 
centre resident area; station 2 is the nearest home in 
Kirkenes; station 3 is the nearest home in Bjørnevatn 
and station 4 is another home in Bjørnevatn 
considered to be a potential problem area. Station 
3 stands out as the most dust exposed location. 
For 6 months of the 10 month period the measured 
value at station 3 was above 5g/m2/30 days. NTNU 
have also estimated values for particulate matter 
(PM10). For 5 of the 10 months, it is estimated that 
PM10 values for station 3 has been above the daily 
average limit of 50µg/m3. Fall out dust is considered 
a nuisance, but particulate matter can be harmful 
to people’s health. The prevention methods for 
particulate matter are the same as for fall out dust. 
The Company will take further actions to reduce 
dust to the exposed areas.

In order to recycle the process water, SVG uses the 
ﬂocculants; polyacrylamide and polyDADMAC. An 
investigation into the long-term toxicity on marine 
organisms of polyDADMAC, as well as degradation 
and leaching of ﬂocculants in sediments, according 
to requirements in the emission permit, was 
ﬁnished in 2014 and the reports submitted to 
Miljødirektoratet (the Norwegian Environmental 
Agency). The studies were carried out by two 
Norwegian research institutions: Norwegian Institute 
for Water Research (NIVA) and SINTEF. 

There was no observable indication that the addition 
of polyDADMAC at normal usage concentration 
and at 100 times higher concentrations affects 
growth of turbot or reproduction of the copepod 
Tisbe Battagliai. The highest concentration tested 
did not give observable effects on test organisms. 
The results of the leaching tests suggest a slight 
leaching of polyacrylamide, and possibly also 
of polyDADMAC in normal seawater pH is not 
signiﬁcant. However, the uncertainty of the study 
also implies that one cannot completely rule out the 
possibility that some minute leaching might take 
place. In a situation where polyDADMAC has a very 
low toxicity, both in the short and long term, the use 
of the chemical will probably at worst represent a 
minor environmental problem. If polyDADMAC is 
dosed in the process before polyacrylamide this will 
help to bind Magnaﬂoc 10 to the tailings. SINTEF, 
which investigated the degradation of polyDADMAC 
concluded that polyDADMAC bound to the mineral 
particles are not readily microbially degradable.

 
 
 
 
On 1 October 2014, a proposal for a new monitoring 
program for all water bodies potentially inﬂuenced 
by the Company’s activities was submitted to the 
environmental authorities. All companies with 
emission permits to water have received identical 
requirements to meet new Water Regulations, 
i.e. the implementation of the EU Water Framework 
Directive, in Norway. The monitoring program is 
planned to be completed by 31 December 2015 
and the results submitted to the authorities by 
1 March 2016. Based on these results, the Company 
will later submit a proposal for the frequency of 
future monitoring.

Together with other mines in Norway, the Company 
has decided to take part in the NYKOS project, 
New Knowledge on Sea Deposits, a collaboration 
between several research institutions, The Research 
Council of Norway and Norwegian Mines. The two 
main objectives of the project are:
 – To increase knowledge about environmental 
effect of submarine tailings deposits in 
Norwegian fjords.

 – To enable the development of new 

environmentally sound criteria and monitoring 
technologies for sub-marine tailings deposits to 
facilitate a future-oriented and more sustainable 
minerals industry in Norway.

The Company took part in another research 
program, ImpTail – Improved Submarine Tailings 
Placement in Norwegian Fjords. The aim of this 
research program was to identify innovative 
strategies to improve and accelerate the 
rehabilitation of subsea areas impacted by tailing 
disposal. The main study was completed in late 2013, 
however, to get more results, the work on artiﬁcial 
reefs on old tailings deposits in Bøkfjorden has 
been extended.

Control
In 2014 the Company worked on further 
strengthening of internal control systems. 

Internal audits are part of a program to keep the 
Company’s Internal Control system up to date and 
in line with laws and regulations. In December, the 
Company conducted an overall audit to review 
how the company meets the requirements of the 
Norwegian Internal Control Act. The report from the 
audit is not yet completed; however, the audit did not 
ﬁnd any major non-conformities. Work has already 
started to continue improving our performance 
and closing the non-conformities found in the 
internal audit.

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Norwegian law requires that companies continuously 
seek to substitute current chemical use with less 
occupational hazardous and more environmentally 
friendly alternatives. The Company has a permanent 
program for substitution of chemicals and also 
during 2014 several process chemicals were tested in 
bench trails. There was also one full-scale plant trial; 
however, the tested chemical was not a sufficient 
alternative to justify a substitution.

Warm weather and lack of rain in 2013 drained the 
Company’s fresh water reserves in the Kirkenes 
lakes and precipitation in 2014 was insufficient to 
reﬁll the reserves to normal levels. Therefore, the 
Company was required to apply to the Norwegian 
Water Resources and Energy Directorate (NVE) 
to obtain a temporary permit to lower water levels 
in the Kirkenes lakes. The company was granted a 
limited license to drain Førstevann and Andrevann 
down 0.75 m below the normal limit, valid until 
August 2015.

To secure adequate water supply to meet current 
and future production, the Company has been 
working in parallel on two solutions:

1.  To reopen the license to take process water from 
the Svartaksla Lake across the fjord to the east; 
and 

2.  Investigate the possibility to get water from the 

nearby Pasvik River. 

An application to reopen the Svartaksla concession 
has been submitted to the NVE. The second 
solution, the Pasvik River, which also is the border 
between Norway and Russia, could give the 
Company unlimited volumes of water. There is an 
old agreement between Norway and Russia that 
gives the mine access to the water. This agreement 
is still recognised by both countries, however the 
process of accessing that water may prove to be 
more difficult.

Due to the increase in production and changes 
in ore blend an application for increased use of 
the water treatment chemical PolyDADMAC was 
submitted to Miljødirektoratet. The application 
was based on results of the studies of long-term 
toxicity of polyDADMAC and degradation and 
leaching of ﬂocculants in sediments conducted 
by NIVA and SINTEF. The application was twofold; 
ﬁrst an application for a temporary permit to use 
up to 15 tons of polyDADMAC in 2014. Secondly, 
an application for a permanent amendment of 
the permit to increase the limit to 22 tons of 
polyDADMAC per year. The temporary permit 
was granted in October and Miljødirektoratet is 
still processing the application for permanent 
amendment of the Company’s emission 
permit. The deadline for the public hearing was 
20 December 2014. A decision is expected during 
the ﬁrst half of 2015.

07

 
 
 
 
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Operating Review

Continued

Community Relations
2014 has been a very challenging year for 
the Company, and this was also reﬂected in 
community relations. It is however encouraging 
to observe the strong support by all key local 
stakeholders which emphasise the sound position 
the Company has established in the region. The 
strong operational performance has contributed 
to our improved standing.

The Company also had an extensive dialogue 
with the Ministry of Trade and Fisheries (NFD), 
and have in general become more visible on the 
national scene.

The global development has hit the region hard. 
Bilateral trade with Russia has dropped dramatically 
as a consequence of sanctions, and the strong drop 
in prices for oil and iron ore have made the industrial 
future more insecure. 

The percentage of Company employees who live 
in the Sør-Varanger municipality have continued to 
increase throughout 2014. The Company’s stated 
objective was to reach 80% by the end of 2014, 
which was very nearly reached.

The efforts will continue as it is in the best interest 
of both the municipality and the company to 
minimise the number of commuters. The biggest 
challenge is the very low unemployment rate in 
the municipality, and strong growth in other types 
of business such as oil and gas activities, hence 
making it difficult to ﬁnd both skilled and non-skilled 
labour. This challenge is shared by all industries in 
the region. To meet the challenge and to source 
more of these skills locally, the Company continued 
its policy to engage local apprentices in what is 
a long term commitment to develop these skills 
in the local workforce. The cooperation with the 
key schools in the municipality was stepped up, 
and a reward program for exceptional students 
was institutionalised with strong support from the 
local community.

Due to the ﬁnancial challenges facing the Company 
all year, the support to community cultural, 
development and sporting events in 2014 was 
reduced from previous years. The Company is 
actively participating in local business working 
groups such as Kirkenes Næringshage as well as 
participating in events organised by Finnmark 
Fylkeskommune to develop a mining and mineral 
strategy for the region.

Mining
Our mining strategy for 2014 comprised a very 
different path compared to 2013 and there was also 
a requirement to change strategies between the 
ﬁrst half of the year and the last half. The strategies 
adopted in 2014 enabled a signiﬁcant reduction in 
the stripping ratio while maintaining the ore feed 
requirements along with preserving the long-term 
integrity of the life of mine plan.

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08

Northern Iron Annual Report 2014

Throughout the entire year the focus was an increased 
reliance on the satellite pits Fisketind, Bjørnfell and 
Kjellmannsåsen to optimise recovery of the resource 
and blend with the main pit Bjørnevatn. This strategy 
allowed for increased ﬂexibility of ore sources 
while selectively mining smaller and deeper pits 
and providing sufficient productive working areas. 
A strategic decision was made to defer rehabilitation 
of the Bjørnevatn West wall failure until later in the life 
of mine, with work practices adjusted to accommodate 
smaller working conditions to the North and South of 
Bjørnevatn with the support of the satellite pits.

During the second half of the year the signiﬁcant 
Eastern ramp cut back in Bjørnevatn was also 
strategically delayed until later in 2015 to reduce 
stripping ratio and costs associated with this material 
movement. This volume was redirected into the 
Bjørnfell pit which has a much lower strip ratio 
compared to the natural strip ratio of the mine and 
allowed the business to plan this large stripping 
requirement to align with the cost innovations being 
identiﬁed and delivered. Figure 1 below highlights 
the outcome of the planned strategy to bring lower 
stripping ratio pits into the plan earlier than budget.

Ore production has increased 14% compared to 2013 
to meet the stability and performance of the plant and 
the increased production targets resulted in the yearly 
record of more than 6Mt (Table 2). Ore supply from 
Bjørnevatn was reduced as mentioned above (65% 
of the ore feed for the year, coming from the North 
western ore zone, the saddle area and the Southern 
tunnel area) and partially substituted with material from 
satellite pits which became more active in 2014. The 
overall relative participation of pits in the ore supply to 
the Primary Crusher has signiﬁcantly changed since 
previous years. Satellite pits increased their input in the 
ore supply to de-stress Bjørnevatn since the West wall 
failure occurred in September 2013 and the result of 
the new Blend Strategy is represented in the Table 3:

Figure 1

Waste mined % per pit and overall S/Ratio

100%

90%

80%

70%

60%

50%

40%

30%

20%

10%

0%

3.00

2.50

2.00

1.50

1.00

0.50

–

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BF

Total – S/Radio

 
 
 
 
 
 
 
 
 
 
 
2.4 MILLION TONNES OF DRY CONCENTRATE SHIPPED IN 2014.2.4Mt09NORTHERN IRON ANNUAL REPORT 2014Operating Review

Continued

Table 2

Figure 2 below shows production levels by quarter 
since commencing mine operations:

Actual 
2014

Actual 
2013

Actual 
2012

Actual 
2011

Figure 2

Ore Mined (kt)

6,042

5,288

4,239

4,214

Ex-pit Production

Waste Mined (kt) 10,020

13,138

11,833

8,230

Total Mined (kt)

16,062 18,426

16,071

12,444

Table 3

Ore Blend

Bjørnevatn 

Kjellmannsåsen

Fisketind

Bjørnefjell

Actual  
2014 (%)

Actual  
2013 (%)

65

22

10

4

82

14

4

0

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5000

4000

3000

2000

1000

0

9
0
0
2

2
Q

9
0
0
2
3
Q

9
0
0
2
4
Q

1

0
0
2

1

Q

1

0
0
2

2
Q

1

0
0
2
3
Q

1

0
0
2
4
Q

1
1

0
2

1

Q

1
1

0
2

2
Q

1
1

0
2
3
Q

1
1

0
2
4
Q

2
1
0
2

1

Q

2
1
0
2

2
Q

2
1
0
2
3
Q

2
1
0
2
4
Q

3
1
0
2

1

Q

3
1
0
2

2
Q

3
1
0
2
3
Q

3
1
0
2
4
Q

4
1
0
2

1

Q

4
1
0
2

2
Q

4
1
0
2
3
Q

4
1
0
2
4
Q

4
1
0
2
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10

Northern Iron Annual Report 2014

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Resource and Reserve Statement
Total project Mineral Resources as of 1 February 2015 are shown in Table 4 below:

Table 4

Mineral Resource Summary as at 1 February 2014 (at 15% Fe total cut-off grade)

Prospect

Bjørnevatn

Kjellmansåsen

Tverrdalen

Fisketind Øst (*)

Bjørnefjell

Oskarsmalmen/
Blixmalmen (*)(**)

Jerntoppen (*)

Søstervatn

Grundtjern

Total

Indicated 
(Mt)

Fe 
(Tot)%

Fe 
(Mag)%

Inferred 
(Mt)

Fe 
(Tot)%

Fe 
(Mag)%

32

32

32

28

31

31

30

136.7

10.2

20.4

26.1

16.3

52.2

21.5

–

–

29

27

23

19

23

27

22

136.7

4.2

26.4

23.3

9.3

15.7

–

4.7

2.9

283.4

31

26

223.2

30

30

31

29

32

31

37

34

30

27

24

20

20

25

26

31

32

26

Total 
Tonnes 
(Mt)

273.4

14.4

46.8

49.4

25.6

67.9

21.5

4.7

2.9

506.6

Fe 
(Tot)%

Fe 
(Mag)%

31

32

31

29

31

31

30

37

34

31

28

26

21

20

24

27

22

31

32

26

(*)  The mineral resources for Fisketind Øst, Jerntoppen and Oskarsmalmen/Blixmalmen were updated during 2012 and 2014.

(**)  The portion of this resource that belongs to Blixmalmen has not been reported previously.

The mineral resources are reported inclusive of the ore reserves. During the period from 1 February 2014 to 1 February 
2015, the total mineral resources have been increased from 466.9 Mton with 31% FeTot to 506.6 Mton with 31% FeTot.

Ore reserve summary as at 1 February 2015 are shown in Table 5 below:

Table 5

Ore Reserve Summary as at 1 February 2015 (at 15% Fe total cut-off grade)

Prospect

Bjørnevatn

Tverrdalen

Fisketind Øst (***)

Kjellmannsåsen (****)

Total

Probable Reserve 
(Mt)

Fe 
(Tot)%

Fe 
(Mag)%

128.1

11.2

5.5

9.0

153.8

30

31

30

31

30.4

28

22

22

26

27.1

(***)  These reserves are based on a mineral resource estimate from 2008 and do not reﬂect the update reported in 2012. 

(****)  The 1 February 2014 reserves for Kjellmannsåsen were erroneously reported to be 6.9 Mton due to the use of an older version of the 

pit shell.

During the period from 1 February 2014 to 1 February 2015, the total ore reserves have been depleted, from 155.1 Mt 
with 32% FeTot down to 153.8 Mt with 30% FeTot. Total ore production during the year was 6.2 Mt with 33.3% FeTot.

The Company’s estimates of mineral resources and ore reserves are subject to internal controls and governance 
arrangements which require that independent consultants with expert staff experienced in best practice modelling 
and estimation techniques are involved in the preparation and review of material estimates, underlying assumptions 
and methodologies.

Note:

The information in this report that relates to Mineral Resources and Ore Reserves is based on information compiled by Thomas Lindholm, who 
is a Fellow of the Australasian Institute of Mining and Metallurgy. Thomas Lindholm is employed full time by GeoVista AB. Thomas Lindholm 
has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he 
is undertaking to qualify as a Competent Person as deﬁned in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, 
Mineral Resources and Ore Reserves’. Thomas Lindholm consents to the inclusion in the report of the matters based on his information in the 
form and context in which it appears.

11

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Operating Review

Continued

Operational improvements were realised with 
a very minor capital commitment, with gains 
achieved through improved planning, practices 
and productivity of operational personnel.

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Concentrate Production
The 2014 production result was a signiﬁcant improvement over previous years representing an annualised 
increase of over 15% for both milled and concentrate volumes, as shown in Table 6:

Table 6

Ore Milled (kt)

Concentrate Produced (Dry kt)

Tonnes Shipped (Dry kt)

Actual 2014

Actual 2013

Actual 2012

5,555

2,342

2,385

4,791

1,992

1,917

4,725

1,980

1,928

The results for 2014 were achieved through focus on integrated operations from mine pit through to logistics and 
processing, underpinning plant circuit stability and allowing signiﬁcantly improved maintenance practices to be 
implemented. The implementation of regular, planned shutdowns resulted in increased run hours to be achieved 
in crushing, milling and ﬁltration unit operations, which further allowed a clearer focus and improvement in unit 
operating rates.

Fine crushing rates were boosted through the introduction of mobile crushing by a third party contractor, 
ensuring an adequate and consistent supply of mill feed stocks. An increase to the milling rate was achieved with 
the resultant circuit stability and through a targeted optimisation program to revise operating parameters, along 
with implementation of minor design changes. Filtration unit rates were not signiﬁcantly boosted, but the overall 
circuit and maintenance efficiency was signiﬁcantly improved by simplifying to two standard ﬁlter types.

It is noteworthy that the operational improvements were realised with a very minor capital commitment, with 
gains achieved through improved planning, practices and productivity of operational personnel. These efforts 
were rewarded with several production records being set during 2014. Notably, two consecutive quarters above 
600kt concentrate were achieved, with 626kt achieved in the quarter ending in June and 600kt achieved in the 
quarter ending September. In addition, a monthly record of 222kt concentrate was achieved in May.

Table 7 below shows the sustained product quality that continued to be delivered during 2014 in conjunction 
with steady and increased production volumes. During the last half of 2014, an increased focus was placed on 
control of sulphur and silica quality resulting from the ore blend available relative to the constrained mining path.

Table 7

2014

2013

2012

2011

2010

Iron  
(%)

68.01

68.15

68.01

66.90

62.92

Silica  
(%)

4.84

4.77

4.78

5.75

10.74

Alumina 
(%)

Phosphorus  
(%)

Sulphur  
(%)

Manganese 
(%)

0.21

0.20

0.21

0.22

0.45

0.01

0.01

0.01

0.01

0.01

0.03

0.03

0.01

0.01

0.02

0.05

0.06

0.06

0.05

0.05

12

Northern Iron Annual Report 2014

 
 
 
 
Sales and Marketing
The Company shipped a total amount of 2,385,000 
tonnes of dry concentrate during the year with 
2,193,000 tonnes shipped to Europe and 192,000 
tonnes shipped to Bahrain. The average sale price 
achieved for the year was US$84 per dry metric 
tonne FOB Kirkenes. 

Given the downward trend of the iron ore price 
this year, the Company announced during quarter 
three that it had reached an agreement with its 
largest customer to amend its offtake contract. 
Under the terms of the agreement the Company 
will supply additional volumes with the pricing 
applied to tonnage sold during the period from 
July 2014 to March 2015 being similar to spot pricing 
arrangements. The deferral of the previous contract 
pricing arrangement will be repayable should the 
market pricing environment improve materially, 
or else at the end of the contract term (31 March 
2018). At year-end, the deferred liability owing to 
the customer as a result of the contract amendment 
is approximately US$5.8 million.

Expansion Study
Since 2010, SVG has been working on an expansion 
project which scope was to add an additional 
production line to the existing one. One of the 
assumptions behind this project was that the existing 
facilities would enable a production of 2.8 million 
tons per annum (“Mtpa”) of iron ore concentrate. 
The expansion project was hence deﬁned to double 
existing capacity to 5.6 Mtpa.

In parallel to the signiﬁcant operational 
improvements over the last 18 months, it has become 
clear that the original expansion project would 
not be feasible for a number of reasons. Firstly 
the redeﬁned capacity of the existing facilities is 
now estimated at 2.5 Mtpa, and the increase up to 
2.8 Mtpa would require further investment. Secondly, 
given the current market situation and outlook for 
iron ore concentrate, it would be unrealistic to raise 
US$300 million to undertake a major expansion.

During the ﬁrst months of 2014, management 
worked to change the scope and develop a more 
sustainable model for the necessary increase in 
production capacity over the coming years. This 
new approach, called Roadmap, was approved 
by the Company’s board and is subject to further 
reﬁnement. This concept calls for a step approach 
to expansion and is based on identifying the 
key bottlenecks at any stage. One of the major 
advantages is a totally different ﬁnancial proﬁle and 
hence also risk proﬁle as any cash generated from 
the previous step change could be utilised to ﬁnance 
the next.

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The Environmental and Social Impact Assessment 
study (ESIA) has not been affected by the changed 
scope and this process aimed to secure the 
necessary permits remains the most critical path 
for any expansion. The Company requires two key 
authority approvals to proceed with an expansion, 
a land use approval from the local Sør-Varanger 
municipality, and a permit for increased waste 
emissions from Miljødirektoratet (The Directorate for 
the Environment). In order to obtain both approvals 
an ESIA must be completed. 

During 2014 the Company continued this work 
in close cooperation with the major Norwegian 
consulting company Norconsult, the Sør-Varanger 
municipality and other key stake holders both at a 
local, regional and national level. The scope of work 
is quite comprehensive, and particularly some of the 
marine activities require an all season approach to 
monitor and collect sufficient data. Some of these 
activities on the critical time line, were initiated in 
2013 and continued throughout 2014, and will be 
completed in the ﬁrst quarter of 2015.

Due to the difficult ﬁnancial situation, the majority 
of other activities have been postponed, and it is 
unclear as to when the Company will be able to 
restart this work. As a consequence of this delay, 
the overall time schedule has been postponed. The 
Company is targeting completion of the ESIA ﬁeld 
work in 2015 with the applications to the local and 
national regulators to be submitted in the fourth 
quarter. If this timeline is kept, the approvals should 
be issued in the ﬁrst part of 2016. There is however, 
signiﬁcant uncertainty related to the approval 
process, but the Company considers it realistic 
to assume that following the approval, it would 
be possible to commence construction activities 
promptly thereafter. This is however, under the 
proviso that improved market conditions will enable 
restarting the ceased work.

Financial Review
The consolidated loss from continuing operations 
for the year net of tax of US$180,695,000 (2013: 
US$1,654,000 loss) reﬂects:
 – US$182,042,000 of sales revenue 
 – US$280,900,000 of operational and 
administration expenses, including 
US$23,337,000 of depreciation and amortisation 
expenses and US$71,300,000 of impairment 
write-downs

 – US$4,041,000 interest expense and 

US$10,094,000 of ﬁnance charges relating 
to changes in provisions
 – US$33,435,000 hedging loss
 – US$31,445,000 income tax expense arising on 
the derecognition of a net deferred tax asset.

13

 
 
 
 
Signiﬁcant accomplishments 
in 2014, compared to the 
prior year include:

Record achievements in monthly 
and quarterly operational results

14%

increase in 
ore mined

18%

increase in 
concentrate 
production

24%

increase in 
concentrate 
sales

20%

decrease in 
unit cash 
operating 
costs (C1)

Looking ahead, the Company will continue to actively institute measures toward further 
cost reductions, improvements in efficiency as well as furthering the discussions with 
stakeholders with the aim of strengthening the Company’s ﬁnancial position and 
delivering a long term sustainable solution.

14 Northern Iron Annual Report 2014

Directors’ Report 16Auditor’s Independence Declaration 29Consolidated Statement  of Comprehensive Income 30Consolidated Statement  of Financial Position 31Consolidated Statement  of Changes in Equity 32Consolidated Statement  of Cash Flows 33Notes to the Financial Statements 34Directors’ Declaration 75Independent Auditor’s Report 76Corporate Governance Statement 78Additional Shareholder Information  90Corporate Directory 97ContentsFinancial Report15Directors’ Report

For the year ended 31 December 2014

The directors present the annual report of the 
Group consisting of the Company and the entities 
it controlled during the period for the ﬁnancial year 
ended 31 December 2014. In order to comply with the 
provisions of the Corporations Act 2001, the directors 
report as follows.

During his career he has held a variety of corporate 
and site based ﬁnance and accounting roles with 
resources companies including Exxaro Resources, 
Perilya Ltd and Robe River Iron Associates.

During the past three years Mr Beckmand has not 
been a director of any other listed entity.

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Directors
The names and details of the Company’s directors 
in office at any time during or since the end of the 
ﬁnancial year are as follows. Directors were in office 
for this entire period unless otherwise stated.

Current Directors

Peter R Bilbe 
Chairman
BE (Mining) (Hons), MAusIMM

Appointed a director on 5 November 2007

Peter has 40 years’ experience in senior 
operational and corporate roles in the resources 
sector both in Australia and overseas and previously 
was the Managing Director and Chief Executive 
Officer of Aztec Resources Limited which successfully 
developed the Koolan Island iron ore project.

Peter has signiﬁcant experience as a mining engineer, 
and prior to his role with Aztec Resources Limited 
was General Manager of Operations for Portman 
Limited, managing the Koolyanobbing and Cockatoo 
Island iron ore projects. 

Mr Bilbe is a member of the Audit Committee and 
the Remuneration, Nomination, and Governance 
Committee.

During the past three years Mr Bilbe has held the 
following listed company directorships:

Sihayo Gold Limited 
(Chairman)  

Independence Group NL 
(Chairman)

From June 2010 to  
November 2013

Since March 2009 

Antony Beckmand 
Managing Director and Chief Executive Officer
CPA, BCom (Acc & Fin), GradDip AFI SIA

Appointed as Managing Director and Chief Executive 
Officer on 8 July 2013

Tony joined the Company in October 2008 and 
was appointed as Managing Director of Northern 
Iron Limited in July 2013, prior to which he held the 
role of Chief Financial Officer of NFE since October 
2009. Tony is a qualiﬁed CPA with a B.Com from the 
University of Western Australia and a Grad. Dip in 
Applied Finance and Investment from the Securities 
Institute of Australia. Tony has more than 18 years’ 
experience within the mining industry across a range 
of operations including iron ore, minerals sands, base 
metals and gold. 

16 Northern Iron Annual Report 2014

Ashwath Mehra 
Non-Executive Director
BSc (Econ)

Appointed a director on 22 May 2007

Ashwath is an economist and founded the MRI 
Group, a commodities group with annual turnover of 
approximately $3 billion. He is currently CEO of Astor 
Management AG, a holding company with interests 
in natural resources businesses. He has worked in 
the minerals industry for 29 years, starting his career 
with Philipp Brothers after which he spent 10 years 
with Glencore, where he was a senior partner and ran 
the Nickel and Cobalt Divisions. He has substantial 
experience in projects and project ﬁnance and has 
worked on equity and bond issues.

Mr Mehra is Chairman of the Audit Committee and 
a member of the Remuneration, Nomination and 
Governance Committee.

During the past three years Mr Mehra has held the 
following listed company directorships:

EMED Mining Limited 

Since October 2008

Champion Minerals Inc. 

From October 2010 
to April 2013

Fancamp Exploration Limited  Since September 2013

Felix H Tschudi 
Non-Executive Director
BSc (Econ), MBA

Appointed a director on 13 December 2007

Felix is the Chairman and owner of Tschudi Shipping 
Company AS, the holding company of the Tschudi 
Group. Tschudi Mining AS, a member company of the 
Tschudi Group, is the registered holder of 67,133,728 
shares in the Company (13.86%). 

Felix attended the Royal Norwegian Naval Academy 
and served as Sub-Lieutenant in the Royal Norwegian 
Navy. He earned a Second Mate’s certiﬁcate from 
merchant navy colleges in the UK, a BSc (Econ) from 
London School of Economics, and an MBA from 
INSEAD, France. 

Before joining the family shipping company Tschudi 
& Eitzen in 1989, Felix worked for the Vienna-based 
trading and ﬁnance house AWT specialising in trade 
structures in Eastern Europe and the former Soviet 
Union. Felix was the joint managing director of 
Tschudi & Eitzen from 1992 until 2002. 

 
 
 
 
 
He worked as the managing director of the Oslo stock 
exchange listed company Tschudi & Eitzen Shipping 
ASA from 1995 until 1997. 

Peter S Larsen 
Alternate Director for Felix Tschudi
MSc (Econ)

Felix is the Chairman of the Centre for High North 
Logistics, a non-proﬁt organisation focusing on 
transportation solutions in the Arctic and a member 
of the World Economic Forum’s Global Agenda 
Council on the Arctic. He is Chairman of the board 
of Maritime Forum Oslofjorden, a member of the 
Committee of the P&I Club Skuld, the board of the 
Norwegian publishing house Aschehoug & Co., and a 
former president of the Oslo Shipowners’ Association.

Mr Tschudi is Chairman of the Remuneration, 
Nomination and Governance Committee and a 
member of the Audit Committee.

During the past three years Mr Tschudi has not been 
a director of any other listed entity.

Peter Campbell Church OAM FAICD 
Non-Executive Director
B.Com (UNSW), LLB (University of Sydney), LLM 
(University of London)

Appointed a director on 1 April 2014

Mr Church is an Australian commercial lawyer who 
resides in Singapore. Mr Church has had a career 
spanning more than 30 years encompassing signiﬁcant 
experience throughout South East Asia and India, 
including providing legal and corporate services on 
numerous regional projects including many in the 
resources sector. Mr Church was a senior partner with 
the leading Australian and regional law ﬁrm now known 
as Herbert Smith Freehills, and was its Asian Regional 
Managing Partner at the time he retired from the ﬁrm. 
In 1994 Mr Church was awarded the Medal of the Order 
of Australia (OAM) by the Australian Government for 
his promotion of business between Australia and South 
East Asia.

In addition to his directorship of our Company, 
Mr Church’s roles include non-executive director 
of OM Holdings Limited, Chairman of AFG Venture 
Group, Special Counsel to the English law ﬁrm of 
Stephenson Harwood, a non-executive director of 
the Singapore International Chamber of Commerce 
and a non-executive director of Elara Capital PLC. 
Mr Church is a Fellow of the Australian Institute of 
Company Directors. During the past three years 
Mr Church has been a director of the listed entity, 
OM Holdings Limited.

Appointed alternate director on 30 November 2010.

Peter, an economist, is currently the Chief Financial 
Officer of Tschudi Shipping Company AS. He has 
worked in the shipping and energy industries for 
24 years, starting his career with Burmeister & 
Wain Shipyard, followed by 10 years in the European 
energy sector with a focus on project development 
and ﬁnancing. He has considerable experience in 
risk management within the power and commodity 
sectors. 

During the past three years he has not been a 
director of any other listed entity, however Mr Larsen 
is Chairman of the Company’s unlisted subsidiary, 
Sydvaranger Gruve AS.

Company Secretary

Alex J Neuling
BSc, FCA (ICAEW), AGIA

Mr Alex Neuling was appointed company secretary 
on 1 January 2010. Alex is a Chartered Accountant 
and Chartered Secretary with more than 16 years’ 
professional and corporate experience, including 
signiﬁcant experience in the provision of company 
secretarial and ﬁnancial management consultancy 
services to ASX listed companies.

Directors’ Shareholdings
At the date of this report, the relevant interests of 
the directors in ordinary shares and options of the 
Company are as follows: 

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Name

PR Bilbe 

A Beckmand

A Mehra 

FH Tschudi 

PC Church

PS Larsen

Ordinary 
shares

215,288

–

15,702,792

67,133,728

–

32,000

Options 
over 
ordinary 
shares

–

–

–

–

–

–

17

 
 
 
 
Directors’ Report

For the year ended 31 December 2014

Dividends
No dividends were paid during the year and the 
directors do not recommend payment of a dividend 
in respect of the current ﬁnancial year.

Other than this, no matter or circumstance has 
arisen since 31 December 2014 that in the opinion 
of the directors has signiﬁcantly affected, or may 
signiﬁcantly affect in future ﬁnancial years:

(i)  the Group’s operations; 

(ii) the results of those operations; or

(iii) the Group’s state of affairs.

Likely Developments 
The likely developments for the 2015 ﬁnancial year 
are contained in the operating and ﬁnancial review as 
set out on pages 5 to 14.

The directors are of the opinion that further 
information as to the likely developments in the 
operations of the Group would prejudice the interests 
of the Company and the Group and it has accordingly 
not been included.

Environmental Regulation and Performance
The environmental regulation and performance of the 
Company for the ﬁnancial year ended 31 December 
2014 is contained in the operating and ﬁnancial 
review as set out on pages 6 and 7 and forms part 
of this report.

Indemniﬁcation and Insurance of Directors and 
Officers
During the ﬁnancial year, the Company paid a 
premium to insure the directors and officers of the 
Company and its controlled entities. The policy 
prohibits the disclosure of the nature of the liabilities 
covered and the amount of the premium paid.

Deeds of Access and Indemnity have been executed 
by the Company with each of the directors and the 
Company Secretary. The deeds require the Company 
to indemnify each director and the Company 
Secretary against any legal proceedings, to the 
extent permitted by law, made against, suffered, paid 
or incurred by the director or the Company Secretary 
pursuant to, or arising from or in any way connected 
with the director or the Company Secretary being an 
officer of the Company.

Remuneration Report
The Remuneration Report is set out on pages 19 to 26 
and forms part of this Directors’ Report.

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Principal Activities
The principal activities of the Group are included 
in the operating and ﬁnancial review as set out on 
pages 5 to 14.

Operating and Financial Review
An operating and ﬁnancial review of the Group for 
the ﬁnancial year ended 31 December 2014 is set out 
on pages 5 to 14 and forms part of this report.

Signiﬁcant Changes in State of Affairs
There were no signiﬁcant changes in the state of 
affairs in the year under review.

Events Subsequent to Reporting Date 
In January 2015, a new working capital facility in 
the amount of US$10.0 million from DNB was made 
available to the Company, subsequently increased 
to US$11.2 million during March 2015, of which the 
majority of the funding was reserved to cover foreign 
exchange hedging losses realised in the March 2015 
quarter due to the weakness in the US$:NOK rate. 
This facility is available for the period 1 January 2015 
to 31 March 2015.

In January 2015, the Company reached agreements 
with DNB, Innovasjon Norge and Tschudi Bulk 
Terminals for the deferral of interest payments 
associated with its debt facilities and lease payments 
for the period from 1 January 2015 to 31 March 2015. 
Subsequent agreements were reached in March 2015 
where the deferral of payments has been extended 
up until 30 June 2015. Financial covenants associated 
with loan agreements were waived for the same 
period.

In March 2015, the Company reached an agreement 
with its main offtake partner according to which 
sales will be similar to spot pricing arrangements 
and improved payment terms will be applied for the 
period 1 April 2015 until 30 June 2015.

In March 2015, the Company reached an agreement 
with DNB on restructuring its debt facilities until 
30 June 2015 which included an adjustment to the 
borrowing base mechanism of the working capital 
facility, to enable the Company to effectively manage 
its liquidity position. 

In March 2015, DNB closed out the exposure on 
foreign exchange hedge contracts remaining in the 
2015 year and provided funding to the Company of 
this position with the result that the close out of these 
hedging contracts will have no liquidity effect for the 
Company for the next 12 months.

18 Northern Iron Annual Report 2014

 
 
 
 
Remuneration Report (Audited)
(all amounts in US$ unless otherwise stated)

Directors’ and Executive Officers’ Remuneration
The remuneration report as set out on pages 19 to 26  
outlines the remuneration arrangements in place 
for the key management personnel of Northern Iron 
for the ﬁnancial year ended 31 December 2014. The 
information contained in the remuneration report has 
been audited as required by Section 308(3C) of the 
Corporations Act. The remuneration report details 
the remuneration arrangements for key management 
personnel (“KMP”) who are deﬁned as those having 
authority and responsibility for planning, directing 
and controlling the major activities of the Company 
and the Group, directly or indirectly, including any 
director (whether executive or otherwise) of the 
parent company.

Total remuneration paid or payable to Directors 
& Key Management Personnel during the year 
was $2,897,758 (2013: $3,547,287). Signiﬁcant 
items driving the observed decrease in reported 
remuneration included a reduction in the number of 
key management personnel and the phasing out of 
retention payments which were previously introduced 
in 2011/12 at the time of the Company announced a 
Strategic Review process. Retention payments in the 
amount of $79,342 were incurred in the current year 
(2013: $623,030).

The Remuneration, Nomination, and Governance 
Committee determines remuneration policies and 
practices, evaluates the performance of senior 
management, and considers remuneration for 
those senior managers. This Committee assesses 
the appropriateness of the nature and amount 
of remuneration on an annual basis by reference 
to industry and market conditions, and with 
regard to the Company’s ﬁnancial and operational 
performance. 

Total non-executive directors’ fees are approved 
by shareholders and the Board is responsible for 
the allocation of those fees amongst the individual 
members of the Board. 

The value of remuneration is determined on the basis 
of cost to the Company and Group. 

Principles of Compensation 
Remuneration of directors and other KMP is referred 
to as compensation, as deﬁned in AASB 124.

Compensation levels for KMP of the Company and 
Group are competitively set to attract and retain 
appropriately qualiﬁed and experienced directors 
and senior executives. Compensation arrangements 
include a mix of ﬁxed and performance based 
compensation. Short Term Incentive payments 
are made against predetermined metrics which 
included safety, production and cost targets with 
an adjustment to take into account movements in 
the iron ore price. A component of share-based 
compensation is awarded at the discretion of 
the Board, subject to shareholder approval when 
required.

Compensation structures take into account the 
overall level of compensation for each director and 
executive officer, the capability and experience of 
the directors and executive officers, the executive 
officers’ ability to control the ﬁnancial performance 
of the relative business segment, the Group’s 
performance (including earnings and the growth in 
share price), and the amount of any incentives within 
each executive officer’s remuneration. 

The Company was incorporated in May 2007 
and listed on ASX in December 2007 at an Initial 
Public Offer price of A$2.15 per share. Historical 
share price, earnings, and dividends were 
considered in determining remuneration during 
the reporting period.

Share price

A$0.03 A$0.22 A$0.54

31/12/14 31/12/13 31/12/12

Consolidated net (loss)/
profit after tax from 
continuing operations 
(US$000)

(109,396)

(1,654)

(11,337)

Fixed Compensation
Fixed compensation consists of base compensation 
as well as any employer contributions to 
superannuation funds. Base compensation may 
be supplemented by an element of equity based 
compensation.

Equity-based compensation is set out in the Equity 
Instruments section of this Remuneration Report.

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19

 
 
 
 
Directors’ Report

For the year ended 31 December 2014

Non-Executive Directors
Total remuneration for all non-executive directors, 
last voted upon by shareholders at a General Meeting 
in November 2007, is not to exceed A$500,000 
per annum. 

ii. 

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A non-executive director’s fee is currently 
A$42,500 per annum, having been reduced from 
$50,000 per annum towards the end of 2014. The 
Chairman’s fee is currently A$106,250, having 
been reduced from A$125,000 towards the end of 
2014. Non-executive directors do not receive any 
performance related remuneration. Directors’ fees 
cover all main Board activities and membership of 
Board committees. The Company does not have any 
terms or schemes relating to retirement beneﬁts for 
non-executive directors.

In November 2014 the Board agreed to a 15% 
reduction in the Directors’ fees for a 6 month period 
commencing November 2014.

Non-executive directors may receive share-based 
compensation at the discretion of the Board, and 
subject to approval by shareholders.

Service Contracts
The contract duration, period of notice and 
termination conditions for directors and executive 
officers are as follows:

i. 

 Antony Beckmand, Managing Director and 
Chief Executive Officer of Northern Iron Limited. 
Commenced employment with the Group in 
October 2008, appointed Chief Financial Officer 
of Northern Iron Limited on 30 September 2009, 
and appointed Managing Director and Chief 
Executive Officer on 8 July 2013 with no set 
term. Mr Beckmand will be paid a base salary of 
A$415,000 pa plus superannuation. Termination 
by the employee is with 6 months’ notice and 
by the Company is with 1 months’ notice with 
a payment equal to 6 months’ base salary plus 
superannuation. The Company may terminate 
the contract at any time without notice if serious 
misconduct has occurred. A short-term incentive 
bonus is provided. The Board shall determine the 
KPIs and the bonus that the employee will be paid 
if his KPIs are achieved. Such a bonus will be set 
at a rate of no more than 50% of the base salary. 
A long-term incentive scheme is provided, being 
equity participation in the Company’s Performance 
Rights Plan, subject to achievement of KPIs during 
the vesting period. The maximum number of 
shares is set at 1,000,000, vesting over a 3 year 
period. The Company may, at its discretion, make 
a cash-payment in lieu of issuing shares based on 
the 5 day VWAP market value of those shares. In 
October 2014, Mr Beckmand volunteered a 10% 
reduction in salary for an initial period of 6 months. 

20 Northern Iron Annual Report 2014

 Sissel Bækø, General Manager of Production 
Services of Sydvaranger Gruve AS. Commenced in 
this role 1 March 2012 with no set term. Termination 
by the Company or the employee is with three 
months’ notice. The Company may terminate 
the contract at any time without notice if serious 
misconduct has occurred. Ms Bækø will be paid 
a base salary of NOK 1,400,000 pa plus statutory 
pension contributions as required under Norwegian 
law and the minimum National Insurance Scheme 
payable in Norway. A short-term incentive bonus 
is provided. The Board shall determine the KPIs 
and the bonus that the employee will be paid if 
her KPIs are achieved. Such a bonus will be set 
at a rate of no more than 50% of the base salary. 
A retention bonus of 50% of base salary was paid 
during the previous reporting period as Ms Bækø 
was still employed with SVG/NFE on 1 July 2013. 
A long-term incentive scheme is provided, being 
equity participation in the Company’s Performance 
Rights Plan, subject to achievement of KPIs during 
the vesting period. The maximum number of shares 
is set at 150,000, vesting over a 3.5 year period. 
The parent Company may, at its discretion, make 
a cash-payment in lieu of issuing shares based on 
the 5 day VWAP market value of those shares. 
Pension is to be paid as required under Norwegian 
law. In October 2014, Ms Bækø volunteered a 5% 
reduction in salary for an initial period of 6 months.

iii.   Aaron Maurer, General Manager of Operations 
of Sydvaranger Gruve AS. Commenced in this 
role 1 February 2014 with no set term. Mr Maurer 
will be paid a base salary of NOK 1,800,000 pa 
plus pension as required under Norwegian law 
and the minimum National Insurance Scheme 
payable in Norway. Termination by the Company 
or the employee is with six months’ notice. The 
Company may terminate the contract at any time 
without notice if serious misconduct has occurred. 
Mr Maurer resigned during January 2015. 

iv.   Rob Brown, General Manager of Operations of 

Sydvaranger Gruve AS. Commenced 5 July 2011 
with no set term. Mr Brown will be paid a base 
salary of A$275,000 pa plus pension as required 
under Norwegian law and the minimum National 
Insurance Scheme payable in Norway. Termination 
by the Company or the employee is with three 
months’ notice. The Company may terminate 
the contract at any time without notice if serious 
misconduct has occurred. A short-term incentive 
bonus is provided. The Board shall determine 
the KPIs and the bonus that the employee will 
be paid if his KPIs are achieved. Such a bonus 
will be set at a rate of no more than 50% of the 
base salary. A retention bonus of 50% of base 
salary was paid during the previous reporting 
period as Mr Brown was still employed with SVG/
NFE on 5 July 2013, which will continue annually 

 
 
 
 
to achievement of KPIs during the vesting period. 
The maximum number of shares is set at 150,000, 
vesting over a 3.5 year period. The Company 
may, at its discretion, make a cash-payment in 
lieu of issuing shares based on the 5 day VWAP 
market value of those shares. In October 2014, 
Mr Haaparanta volunteered a 10% reduction in 
salary for an initial period of 6 months.

vii. Eric Evanson, General Manager of Business 

Improvement and Commercial. Commenced in this 
role 20 August 2014 with no set term. Mr Evanson 
will be paid a base salary of NOK 1,300,000 pa 
plus pension as required under Norwegian law 
and the minimum National Insurance Scheme 
payable in Norway. Termination by the Company 
or the employee is with three months’ notice. The 
Company may terminate the contract at any time 
without notice if serious misconduct has occurred. 
In October 2014, Mr Evanson volunteered a 5% 
reduction in salary for an initial period of 6 months.

viii. Rod Lovelady, General Manager of Commercial 
and Technical Services. Commenced in this role 
1 January 2014 with no set term. Mr Lovelady 
will be paid a base salary of NOK 1,560,000 pa 
plus pension as required under Norwegian law 
and the minimum National Insurance Scheme 
payable in Norway. Termination by the Company 
or the employee is with three months’ notice. The 
Company may terminate the contract at any time 
without notice if serious misconduct has occurred. 
Mr Lovelady resigned 29 June 2014. 

ix.  Adrian Mills, General Manager of Finance and 

IT. Commenced in this role 1 January 2014 with 
no set term. Mr Mills will be paid a base salary 
of NOK 1,300,000 pa plus superannuation. 
Termination by the Company or the employee 
is with three months’ notice. The Company 
may terminate the contract at any time without 
notice if serious misconduct has occurred. In 
October 2014, Mr Mills volunteered a 5% reduction 
in salary for an initial period of 6 months. 

4
1
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A
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I

N
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E
H
T
R
O
N

at a rate of 25% of base salary if employed on 
subsequent anniversaries. A long-term incentive 
scheme is provided, being equity participation in 
the Company’s Performance Rights Plan, subject 
to achievement of KPIs during the vesting period. 
The maximum number of shares is set at 150,000, 
vesting over a 3.5 year period. The Company 
may, at its discretion, make a cash payment in 
lieu of issuing shares based on the 5 day VWAP 
market value of those shares. Mr Brown resigned 
31 March 2014.

v.  Harald Martinsen, Chief Development Officer of 
Sydvaranger Gruve AS. Commenced 28 August 
2011 with no set term. Mr Martinsen will be paid a 
base salary of NOK 1,800,000 pa plus pension as 
required under Norwegian law and the minimum 
National Insurance Scheme payable in Norway. 
Termination by the Company or the employee 
is with three months’ notice. The Company may 
terminate the contract at any time without notice 
if serious misconduct has occurred. A short-
term incentive bonus is provided. The Board 
shall determine the KPIs and the bonus that the 
employee will be paid if his KPIs are achieved. Such 
a bonus will be set at a rate of no more than 50% 
of the base salary. A retention bonus of 50% of 
base salary was paid during the previous reporting 
period as Mr Martinsen was still employed with 
SVG/NFE on 1 July 2013. A long-term incentive 
scheme is provided, being equity participation in 
the Company’s Performance Rights Plan, subject 
to achievement of KPIs during the vesting period. 
The maximum number of shares is set at 150,000, 
vesting over a 3.5 year period. The Company may, 
at its discretion, make a cash-payment in lieu of 
issuing shares based on the 5 day VWAP market 
value of those shares. Mr Martinsen resigned 
31 October 2014. 

vi.  Ismo Haaparanta, Chief Executive Officer of 

Sydvaranger Gruve AS. Commenced 1 May 2012 
with no set term. Mr Haaparanta will be paid a 
base salary of NOK 2,400,000 pa plus pension as 
required under Norwegian law and the minimum 
National Insurance Scheme payable in Norway. 
Termination by the Company or the employee 
is with six months’ notice. The Company may 
terminate the contract at any time without notice 
if serious misconduct has occurred. A short-
term incentive bonus is provided. The Board 
shall determine the KPIs and the bonus that the 
employee will be paid if his KPIs are achieved. 
Such a bonus will be set at a rate of no more 
than 50% of the base salary. A retention bonus of 
12.5% of base salary was paid during the reporting 
period as Mr Haaparanta was still employed with 
SVG/NFE on 1 May 2014. A long-term incentive 
scheme is provided, being equity participation in 
the Company’s Performance Rights Plan, subject 

21

 
 
 
 
Directors’ Report

For the year ended 31 December 2014

Directors’ and Executive Officers’ Remuneration

2014

Name

Short Term

Post- 
employment

Share Based Payments

Salary  
and  
fees  
($)

Other  
($)

Cash  
bonus(i)  
($)

Super-
annuation 
contributions  
($)

Options  
($)

Performance 
Rights  
($)

% of 
remuneration 
performance 
related

Total  
($)

Value of 
options and  
rights as  
a proportion 
of remune-
ration (%)

Directors
Non-Executive

Mr PR Bilbe (Chairman)

Mr A Mehra

Mr FH Tschudi

Mr PC Church

100,411

43,929

43,929

(appointed 1 April 2014)

32,665

15,472

–

–

–

–

–

–

–

–

–

–

9,410

–

–

–

–

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

Mr PS Larsen  
(Alternate Director)

Executive

Mr A Beckmand

(MD & CEO – Northern 
Iron Limited)

Executive Officers
Ms S Bækø

(GM of Production 
Services – Sydvaranger 
Gruve AS)

Mr A Maurer

(GM of Operations – 
Sydvaranger Gruve AS) 
(appointed 1 February 
2014; resigned  
15 June 2015)

Mr R Brown

(former GM of Operations 
– Sydvaranger Gruve AS) 
(resigned 31 March 2014)

Mr H Martinsen

(CDO – Sydvaranger Gruve 
AS)

(resigned 31 October 
2014)

Mr I Haaparanta

(CEO – Sydvaranger Gruve 
AS)

Mr E Evanson

(GM Business 
Improvement and 
Commercial – Sydvaranger 
Gruve AS) (appointed  
20 August 2014)

Mr R Lovelady

(former GM Business 
Improvement and 
Commercial – 
Sydvaranger Gruve AS) 
(appointed 1 January 2014; 
resigned 29 June 2014)

365,542

17,752 46,745

34,259

238,202

10,759

13,885

10,655

275,791

50,213

19,042

7,975

53,759

9,294

–

1,914

303,758

32,024

3,570

7,005

444,193

61,916

39,671

8,429

78,877

16,233

137,858

10,102

–

–

3,368

–

Mr A Mills

(GM Finance and IT – 
Sydvaranger Gruve AS) 
(appointed 1 January 
2014)

209,088

41,256

9,521

2,343,474 249,549 132,434

19,350

102,365

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

109,821

43,929

43,929

32,665

15,472

–

–

–

–

–

–

–

–

–

–

69,936

534,234

9%

13%

–

273,501

–

–

353,021

5%

–

64,967

–

–

346,357

–

554,209

–

98,478

–

147,960

1%

7%

–

–

–

279,215

3%

69,936 2,897,758

–

–

–

–

–

–

–

–

(i) 

 In accordance with the Short Term Incentive Scheme, cash bonus payments totalling US$132,435 were made early in 2014, relating to the 
2013 year, in respect of predetermined metrics which included safety, production and cost targets with an adjustment to take into account 
movements in the iron ore price. No payments have occurred related to performance in the 2014 year. In addition, retention bonus payments 
totalling US$79,342 were made to one employee under the terms of their service contract.

22 Northern Iron Annual Report 2014

 
 
 
 
Value of 
options and  
rights as  
a proportion 
of remune-
ration (%)

Directors’ and Executive Officers’ Remuneration (continued)

2013

Short Term

Post- 
employment

Share Based Payments

Name

Directors

Non-Executive

Mr PR Bilbe  
(Chairman)

Mr A Mehra

Mr FH Tschudi

Mr DC Griffiths  
(Former Chairman) 
(resigned 10 June 2013)

Mr PS Larsen 
(Alternate Director)

Executive

Mr A Beckmand  
(MD & CEO – Northern 
Iron Limited)  
(appointed 8 July 2013)(i)

Mr JS Sanderson (Former 
Managing Director) 
(resigned 8 July 2013)

Executive Officers

Ms S Bækø 
(GM of Production 
Services – Sydvaranger 
Gruve AS)

Mr R Brown 
(GM of Operations – 
Sydvaranger Gruve AS)

Mr H Martinsen 
(CDO – Sydvaranger Gruve 
AS)

Mr I Haaparanta 
(CEO – Sydvaranger Gruve 
AS)

Salary  
and  
fees  
($)

Other  
($)

Cash  
bonus(ii)  
($)

Super-
annuation 
contributions  
($)

Options  
($)

Performance 
Rights  
($)

% of 
remuneration 
performance 
related

Total  
($)

81,196

48,290

48,290

48,930

17,016

–

–

–

–

–

–

–

–

–

–

7,446

–

–

4,404

–

454,653

16,708

32,179

41,734

352,152

– 275,604

56,900

363,767

9,803 24,633

10,595

417,243

98,283 23,790

8,205

464,939

41,143

35,191

9,014

430,812

76,707

39,101

8,559

2,727,288 242,644 430,498

146,857

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

88,642

48,290

48,290

53,334

17,016

545,274

684,656

408,798

547,522

550,286

555,178

– 3,547,286

–

–

–

–

–

6%

–

6%

4%

6%

7%

(i)  Prior to 8 July 2013, previous role was Chief Financial Officer

(ii)   In accordance with the Short Term Incentive Scheme, cash bonus payments totalling US$154,894 were made in respect of predetermined 
metrics which included safety, production and cost targets with an adjustment to take into account movements in the iron ore price. In 
addition, retention bonus payments totalling US$623,030 were made to six employees under the terms of their service contracts.

4
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A
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R

I

N
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E
H
T
R
O
N

–

–

–

–

–

–

–

–

–

–

–

23

 
 
 
 
Directors’ Report

For the year ended 31 December 2014

Equity Instruments and Share-Based Payments 
Granted as Compensation for the Current 
Financial Year 

(i)  Shares 
 There were no shares in the Company granted as 
compensation to directors and executive officers 
during the reporting period.

(iii)  Options over equity instruments granted as 
compensation 
There were no options granted during the 2014 or 
2013 year.

Options are recognised as an expense over their 
vesting period. No monies will be payable for the 
issue of the options. 

No options have been granted since the end of the 
ﬁnancial year, nor have any options been exercised 
during or since the end of the reporting period. 
During the reporting period there was no forfeiture of 
options granted in previous periods. 

In the event that the option holder ceases to be an 
employee, director or consultant of the Company, the 
Board may at its sole discretion resolve that all vested 
options held by that employee, director or consultant 
be exercised within 21 days of that employee, director 
or consultant ceasing to be an employee, director 
or consultant (as applicable) of the Company. Any 
unvested options held by that employee, director or 
consultant will lapse.

(iv)  Analysis of movements in options 
There were no options granted during the 2014 or 
2013 ﬁnancial years.

The value of options granted in the year is the fair 
value of the options at grant date using the Black-
Scholes Option Pricing Model. The total value of 
options granted is included in the table above, 
however this amount is allocated to expense over the 
vesting period.

(v)  Analysis of options granted as compensation 
There were no options granted as remuneration to 
directors and executive officers during the 2014 or 
2013 years.

Loans to Key Management Personnel
At 31 December 2014 an amount of US$nil 
(2013: US$nil) is included in Group trade and other 
payables for outstanding director and executive 
officers’ personnel fees and expenses.

4
1
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T
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O
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E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

(ii)  Share based payments

Options
During the 2014 or 2013 year no share-based 
payment arrangements were in existence.

No options have been granted since the end of the 
ﬁnancial year, nor have any options been exercised 
during or since the end of the reporting period. 
During the reporting period, there was no forfeiture 
of options granted in previous periods. 

In the event that the option holder ceases to be an 
employee, director or consultant of the Company, the 
Board may at its sole discretion resolve that all vested 
options held by that employee, director or consultant 
must be exercised within 21 days of that employee, 
director or consultant ceasing to be an employee, 
director or consultant (as applicable) of the Company. 
Any unvested options held by that employee, director 
or consultant will lapse.

Further details of share-based payments are set out 
in Notes 3(r) and 22. 

Performance rights
During the 2014 year 1,000,000 performance rights 
were issued (2013: Nil).

No performance rights have been granted since the 
end of the ﬁnancial year, nor have any performance 
rights been exercised during or since the end of the 
reporting period.

During the reporting period 250,000 (2013: 250,000) 
performance rights expired/lapsed.

In the event that the performance right holder 
ceases to be an employee, director or consultant of 
the Company, the Board may at its sole discretion 
resolve that all vested performance rights held 
by that employee, director or consultant must be 
exercised within 21 days of that employee, director 
or consultant ceasing to be an employee, director 
or consultant (as applicable) of the Company. Any 
unvested performance rights held by that employee, 
director or consultant will lapse.

Further details of share-based payments are set out 
in Notes 3(r) and 22.

24 Northern Iron Annual Report 2014

 
 
 
 
Key Management Personnel Equity Holdings

(i)  Shares
The movement during the current and prior reporting periods in the number of ordinary shares in Northern Iron 
Limited held, directly, indirectly or beneﬁcially, by each key management person, including their related parties, is 
as follows:

2014

Directors

PR Bilbe 

A Beckmand

A Mehra 

FH Tschudi 

PS Larsen

PC Church

2013

Directors

PR Bilbe 

A Beckmand

A Mehra 

FH Tschudi 

PS Larsen

DC Griffiths

JS Sanderson

Held at 
01/01/14

Net 
acquired/
(sold)

Held at 
31/12/14

215,288

–

15,702,792

67,133,728

32,000

–

–

–

–

–

–

–

215,288

–

15,702,792

67,133,728

32,000

–

Held at
01/01/13

Net 
acquired/
(sold)

Held at
31/12/13

215,288

–

15,702,792

67,133,728

32,000

612,090

360,000

–

–

–

–

–

–

–

215,288

–

15,702,792

67,133,728

32,000

612,090*

360,000*

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

* Balance when ceased being a director

(ii) Share options
The movement during the reporting period in the number of options in Northern Iron Limited held, directly, 
indirectly or beneﬁcially, by each key management person, including their related parties, is as follows:

2014
There were no options held during the 2014 year.

2013

Directors

JS Sanderson

Held at 
01/01/13

Granted as 
compen-
sation

Expired

Vested in 
year

Held at 
31/12/13

Vested and 
exercisable 
at 31/12/13

1,500,000

–

(1,500,000)

–

–

–

All share options issued to key management personnel were in accordance with the provisions of the employee 
share option plan.

There were no options granted during the 2014 and 2013 years. Further details of the employee share option plan 
are contained in Note 22 and the Remuneration Report.

There were no options exercised during the 2014 and 2013 years. 

25

 
 
 
 
Directors’ Report

For the year ended 31 December 2014

(iii) Performance rights
The movement during the reporting period in the number of performance rights in Northern Iron Limited, held by 
each member of key management personnel is as follows:

2014

Directors

A Beckmand

Executive officers

S Bækø

R Brown

H Martinsen

I Haaparanta

(i)  Balance when ceased being an employee

2013

Directors

A Beckmand

Executive officers

S Bækø

R Brown

H Martinsen

I Haaparanta

Held at 
01/01/14

Granted as 
compen-
sation

Expired/
Lapsed

Vested in 
year

Held at 
31/12/14

Vested and 
exercisable 
at 31/12/14

–

1,000,000

– 

–

1,000,000

100,000

50,000

100,000

100,000

–

–

–

–

(50,000)

(50,000)

(100,000)

(50,000)

–

–

–

–

50,000

–

–(i)

50,000

–

–

–

–

–

Held at 
01/01/13

Granted as 
compen-
sation

Expired/
Lapsed

Vested in 
year

Held at 
31/12/13

Vested and 
exercisable 
at 31/12/13

50,000

150,000

100,000

150,000

150,000

–

–

–

–

–

(50,000) 

(50,000)

(50,000)

(50,000)

(50,000)

–

–

–

–

–

–

100,000

50,000

100,000

100,000

–

–

–

–

–

Other Key Management Personnel Transactions 
Apart from the details disclosed in this note, no director has entered into a material contract with the Group since 
the end of the previous ﬁnancial year and there were no material contracts involving directors’ interests existing 
at year-end.

End of Remuneration Report

4
1
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2
T
R
O
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R
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A
U
N
N
A
N
O
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I

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R
E
H
T
R
O
N

26 Northern Iron Annual Report 2014

 
 
 
 
Directors’ and Committee Meetings
The number of directors’ and committee meetings and the number of those meetings attended by each of the 
directors of the Company during the year are as follows:

Board

(a)

Audit Committee

Remuneration, Nomination 
and Governance Committee(i)

(b)

(a)

(b)

(a)

(b)

14

14

14

14

1

9

14

14

14

13

1

8

–

4

4

4

1

–

–

4

4

3

1

–

–

1

1

1

–

–

–

1

1

1

–

–

A Beckmand

PR Bilbe 

A Mehra 

FH Tschudi 

PS Larsen(i)

PC Church

(a)  Number of meetings held during period of office

(b)  Number of meetings attended

(i)  As alternate for Mr Tschudi.

Remuneration, Nomination, and Governance Committee
The committee considers remuneration packages and policies applicable to the executive directors, senior 
executives, and non-executive directors. It is also responsible for share option schemes, Employee Share Plans, 
incentive performance packages, and retirement and termination entitlements. Many of these matters are 
also considered by the full Board rather than the Committee. Members of the committee are Mr Felix Tschudi 
(Chairman), Mr Peter Bilbe and Mr Ashwath Mehra.

Names and Qualiﬁcations of Audit Committee Members
The committee is to include at least three members. Current members of the committee are Mr Ashwath Mehra 
(Chair), Mr Peter Bilbe and Mr Felix Tschudi (with Mr Peter Larsen as his alternate). Qualiﬁcations of Audit 
Committee members are provided in the directors section of this Directors’ Report. 

Proceedings on Behalf of the Company
No person has applied for leave of Court to bring proceedings on behalf of the Company or intervene in any 
proceedings to which the Company is a party for the purpose of taking responsibility on behalf of the Company 
for all or any part of those proceedings.

The Company was not a party to any such proceedings during the year.

Rounding of Amounts 
The Company is a company of the kind referred to in Class Order 98/100 issued by the Australian Securities and 
Investments Commission relating to the rounding off of amounts in the Directors’ Report and ﬁnancial report. 

Amounts in the Directors’ Report and ﬁnancial report have been rounded-off to the nearest thousand dollars in 
accordance with that Class Order, unless otherwise indicated.

4
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27

 
 
 
 
Directors’ Report

For the year ended 31 December 2014

Non-Audit Services
Details of amounts paid or payable to the auditors for non-audit services provided during the year by the 
auditors are outlined in Note 5 to the ﬁnancial statements.

The directors are satisﬁed that the provision of non-audit services, during the year, by the auditors (or by persons 
or ﬁrms on the auditor’s behalf) is compatible with the general standard of independence for auditors imposed 
by the Corporations Act 2001.

The directors are of the opinion that the services disclosed in Note 5 to the ﬁnancial statements do not 
compromise the external auditor’s independence, based on advice received from the audit committee, for the 
following reasons:
 – all non-audit services have been reviewed and approved to ensure that they do not impact the integrity and 

objectivity of the auditors, and

 – none of the services undermine the general principles relating to auditor independence as set out in Code of 

Conduct APES 110 Code of Ethics for Professional Accountants issued by the Accounting Professional & Ethical 
Standards Board, including reviewing or auditing the auditor’s own work, acting in a management or decision-
making capacity for the Company, acting as advocate for the Company or jointly sharing economic risks 
and rewards. 

Lead Auditor’s Independence Declaration
The lead auditor’s independence declaration, as required under Section 307C of the Corporations Act, is set out 
on page 29 and forms part of the Directors’ Report for the ﬁnancial year ended 31 December 2014.

The directors’ report is signed in accordance with a resolution of the directors made pursuant to S.292(2) of the 
Corporations Act 2001.

Antony Beckmand 
Managing Director and Chief Executive Officer 

Peter Bilbe 
Chairman

Kirkenes, 31 March 2015 

Perth, 31 March 2015

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28 Northern Iron Annual Report 2014

 
 
 
 
Auditor’s Independence Declaration

For the year ended 31 December 2014

AUDITOR’S INDEPENDENCE DECLARATION

As  lead  auditor  for  the  audit  of  the  consolidated  financial  report  of  Northern  Iron  Limited for  the  year  ended  31 
December 2014, I declare that to the best of my knowledge and belief, there have been no contraventions of: 

a)

b)

the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and

any applicable code of professional conduct in relation to the audit.

Perth, Western Australia
31 March 2015

N G Neill
Partner, HLB Mann Judd

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HLB Mann Judd (WA Partnership) ABN 22 193 232 714
Level 4, 130 Stirling Street Perth WA 6000.  PO Box 8124 Perth BC 6849 Telephone +61 (08) 9227 7500. Fax +61 (08) 9227 7533. 
Email: hlb@hlbwa.com.au.  Website: http://www.hlb.com.au
Liability limited by a scheme approved under Professional Standards Legislation

HLB Mann Judd (WA Partnership) is a member of 

International, a worldwide organisation of accounting firms and business advisers.

27 

29

 
 
 
 
 
 
Consolidated Statement of Comprehensive Income

For the year ended 31 December 2014

Continuing operations

Revenue

Other operating income

Mining and processing expenses

Depreciation and amortisation

Impairment losses

Administration expenses

Foreign exchange (loss)/gain

Hedging loss

Share-based payments expense

Results from operating activities

Finance income

Finance expense

Net finance expense

Loss before income tax

Income tax (expense)/benefit

Loss from continuing operations 

Other comprehensive income

Items which may be reclassified to profit or loss

Exchange differences arising on translation of foreign operations

Exchange differences arising on translation of foreign loan

Income tax on other comprehensive income

Other comprehensive loss for the year net of income tax

Total comprehensive loss for the year net of tax

Basic loss per share from continuing operations 
(cents per share)

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Notes

2014 
US$000

2013 
US$000

4

4

4

4

4

4

4

7

182,042

204,554

689

478

(180,908)

(175,302)

(23,337)

(22,288)

(71,300)

(5,430)

(3,493)

–

(7,372)

3,162

(33,435)

(6,702)

(70)

–

(135,242)

(3,470)

127

(14,135)

(14,008)

174

(4,705)

(4,531)

(149,250)

(8,001)

(31,445)

6,347

(180,695)

(1,654)

(14,352)

(37,243)

14,191

36,231

–

(161)

–

(1,012)

(180,856)

(2,666)

6

(37.30)

(0.34)

The Consolidated Statement of Comprehensive Income should be read in conjunction with the accompanying notes to the ﬁnancial statements.

30 Northern Iron Annual Report 2014

 
 
 
 
Consolidated Statement of Financial Position

As at 31 December 2014

Current assets

Cash and cash equivalents

Trade and other receivables

Derivative financial assets

Inventory

Prepayments

Total current assets

Non-current assets

Trade and other receivables

Mine properties

Property, plant and equipment

Deferred tax asset

Total non-current assets

Total assets

Current liabilities

Trade and other payables

Derivative financial liabilities

Provisions

Current tax liabilities

Interest bearing loans and borrowings

Total current liabilities

Non-current liabilities

Provisions

Interest bearing loans and borrowings

Total non-current liabilities

Total liabilities

Net assets

Equity

Issued capital 

Reserves

Accumulated losses

Total equity

Notes

2014 
US$000

2013 
US$000

20(b)

9

10

11

9

12

13

8

15

16

17

7

18

17

18

6,618

20,655

–

19,768

249

19,446

33,842

534

28,177

332

47,290

82,331

1,505

39,537

1,181

60,071

157,411

230,066

3

31,309

198,456

322,627

245,746

404,958

24,928

40,612

5,739

129

37,949

109,357

12,096

28,391

40,487

31,437

7,063

365

340

50,248

89,453

1,847

36,970

38,817

149,844

128,270

95,902

276,688

19

380,761

380,761

16,722

16,813

(301,581)

(120,886)

95,902

276,688

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The Consolidated Statement of Financial Position should be read in conjunction with the accompanying notes to the ﬁnancial statements.

31

 
 
 
 
Consolidated Statement of Changes in Equity

For the year ended 31 December 2014

Foreign 
currency 
translation 
reserve 
US$000

Share 
based 
payments 
reserve 
US$000

Issued 
capital 
US$000

Accumulated 
losses 
US$000

Total 
US$000

Balance at 1 January 2013

380,761

13,778

4,047

(119,232)

279,354

Profit from continuing operations

Other comprehensive income

Total comprehensive income

–

–

–

–

(1,012)

(1,012)

–

–

–

(1,654)

–

(1,654)

(1,012)

(1,654)

(2,666)

Balance at 31 December 2013

380,761

12,766

4,047

(120,886)

276,688

Profit from continuing operations

Other comprehensive income

Total comprehensive income

Share based payments

–

–

–

–

–

(161)

(161)

–

–

–

–

70

(180,695)

(180,695)

–

(161)

(180,695)

(180,856)

–

70

Balance at 31 December 2014

380,761

12,605

4,117

(301,581)

95,902

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The Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying notes to the ﬁnancial statements.

32 Northern Iron Annual Report 2014

 
 
 
 
Consolidated Statement of Cash Flows

For the year ended 31 December 2014

Cash flows from operating activities

Receipts from customers

Payments to suppliers and employees

Income tax paid

Finance income 

Finance expense

Notes

2014 
US$000

2013 
US$000

192,508

207,688

(176,463)

(183,969)

(320)

127

–

174

(3,856)

(5,336)

Net cash flows provided by operating activities

20(a)

11,996

18,557

Cash flows from investing activities

Payments for mine property

Payments for exploration and evaluation

Payments for deferred waste

Payments for property, plant and equipment

Net security deposits lodged 

Net cash flows used in investing activities

Cash flows from financing activities

Proceeds from interest bearing loans and borrowings

Payment of interest bearing loans and borrowings

Net cash flows (used in)/provided by financing activities

Net (decrease)/increase in cash and cash equivalents

Cash and cash equivalents at the beginning of the financial year

Effect of foreign exchange on the balances of cash and cash equivalents 
held in foreign currencies at the beginning of the year

(2,637)

(2,703)

–

–

(2,847)

(632)

(35)

(7,987)

(6,369)

(712)

(6,116)

(17,806)

–

3,772

(16,658)

(18,504)

(16,658)

(14,732)

(10,778)

(13,981)

19,446

32,379

(2,050)

1,048

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Cash and cash equivalents at the end of the year

20(b)

6,618

19,446

The Consolidated Statement of Cash Flows should be read in conjunction with the accompanying notes to the ﬁnancial statements.

33

 
 
 
 
 
 
Notes to the Financial Statements

For the year ended 31 December 2014

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Note 1. Reporting Entity
The consolidated ﬁnancial report of the Company for 
the ﬁnancial year ended 31 December 2014 comprises 
the Company and its subsidiaries (the “Group”).

Note 2. Basis of Preparation of the Financial 
Report
The ﬁnancial report is a general purpose ﬁnancial 
report prepared in accordance with Australian 
Accounting Standards (“AASBs”) (including 
Australian Accounting Interpretations), as adopted by 
the Australian Accounting Standards Board (“AASB”), 
and the Corporations Act 2001.

The ﬁnancial report has also been prepared on a 
historical cost basis, except for derivative ﬁnancial 
instruments which have been measured at fair value. 
Cost is based on the fair values of the consideration 
given in exchange for assets.

The ﬁnancial report is presented in United States 
dollars and all values are rounded to the nearest 
thousand dollars ($’000) unless otherwise stated 
under the option available to the Company under 
ASIC Class Order 98/100. The Company is an entity 
to which the class order applies.

The Company is a listed public company, 
incorporated in Australia and operating in Norway 
and Switzerland. The entity’s principal activities are 
included in the operating and ﬁnancial review as set 
out on pages 5 to 14.

Statement of compliance
The ﬁnancial report was authorised for issue on 
31 March 2015.

The ﬁnancial report complies with Australian 
Accounting Standards, which include Australian 
equivalents to International Financial Reporting 
Standards (AIFRS). Compliance with AIFRS ensures 
that the ﬁnancial report, comprising the ﬁnancial 
statements and notes thereto, complies with 
International Financial Reporting Standards (IFRS).

Going concern
The ﬁnancial report has been prepared on the going 
concern basis, which contemplates the continuity of 
normal business activity and the realisation of assets 
and the settlement of liabilities in the ordinary course 
of business.

The current economic environment is difficult and 
the Company has recorded a net loss after tax of 
US$180,695,000 for the year. As at 31 December 2014, 
the Group had cash reserves of US$6,618,000 and a 
net working capital deﬁcit of US$62,067,000. Net loss 
after tax has been calculated after deducting non-cash 
items totalling US$128,072,000 (see also Note 20) 
including impairment losses of US$71,300,000 and 

unrealised hedging losses of US$33,435,000 as well 
as depreciation of property, plant and equipment and 
other non-current assets of US$23,337,000.

Whilst the Directors have instituted measures to 
preserve cash, reduce costs and secure additional 
ﬁnance, material uncertainties over future results and 
cash ﬂows exist. At the time of issuing the ﬁnancial 
statements, the Group has yet to negotiate a long-
term extension of the maturity of its debts and 
further negotiation with the Group’s major offtake 
partner are also considered necessary. A temporary 
extension until the end of June 2015 has been agreed 
with all ﬁnanciers.

Signiﬁcant efforts have been made to engage with 
stakeholders to provide additional working capital for 
the business. In the third quarter of 2014, the Group 
agreed with its main offtake customer a variation to 
the existing long-term agreement resulting in higher 
prices being realised. Negotiations with ﬁnanciers and 
the Group’s main offtake partner continued towards 
the end of the calendar year, with the aim of further 
bolstering the Group’s ﬁnancial position.

Subsequent to year-end the Group received further 
support from its ﬁnanciers with a new working 
capital facility being established in the amount of 
US$10 million, largely to cover anticipated losses 
under foreign exchange hedge contracts, as well as 
granting a repayment and interest holiday initially to 
the end of March 2015. During March 2015 the Group 
agreed with its ﬁnanciers to extend the repayment 
and interest holiday until 30 June 2015. In addition, 
the ﬁnanciers of the Group, granted additional 
working capital funding and an undertaking to fund 
anticipated future losses under foreign exchange 
hedge contracts for the year 2015.

On 25 March 2015 the Group signed an addendum 
with its major offtake partner, according to which the 
pricing support agreed in the third quarter of 2014 
has been extended until 30 June 2015. In addition 
to this extension of the pricing support, improved 
payment terms have been agreed until 30 June 2015.

In addition, speciﬁc actions taken by the Group to 
improve liquidity include:
 – Termination of certain major contracts and 

insourcing of work, which is expected to offer 
signiﬁcant savings for the Group materialising over 
the coming months.

 – Identiﬁcation of low cost improvements to increase 

output.

 – Optimising the mine plan to reduce short to 

medium term stripping requirements.

 – Working closely with key suppliers to deliver 

further cost savings.

 – Voluntary payroll reduction across all levels of the 

Group.

34 Northern Iron Annual Report 2014

 
 
 
 
The Group is implementing continuous restructuring 
and working actively on both structural and 
operational measures. This work is in co-operation 
with the Group’s ﬁnanciers and major offtake partner. 
Discussions between the Group and stakeholders 
are underway with the aim of ﬁnding a long term 
sustainable solution ensuring the continued operation 
of the Group. Based on negotiations conducted and 
agreements reached to date, the Directors have a 
reasonable expectation that a successful solution 
can be achieved. This work will continue, and is in 
line with the stated aim and continued support from 
stakeholders, as demonstrated by the additional 
funding and liquidity support received in the ﬁrst 
quarter of 2015.

In summary, the Group is actively working to 
streamline operations, cut costs further where 
possible, achieving prolongation on the maturity of its 
debt, while working actively with potential strategic 
investors.

The main liquidity risk facing the Group is that 
it may be unable to ﬁnd a lasting solution to the 
Group’s debt maturing 30 June 2015 or to conclude 
a long term solution with potential investors and its 
major offtake partner. Other factors, including the 
potential for further weakness in the iron-ore price 
environment and/or operational factors affecting 
the Group’s ability to maintain and build upon recent 
improvements in production and performance also 
have the potential to impact negatively on the ability 
of the Group to continue as a going concern.

Notwithstanding this, the ﬁnancial statements have 
been prepared on a going concern basis, which 
contemplates the continuity of normal business 
activities and the realisation of assets and liabilities in 
the ordinary course of business.

After considering the circumstances described 
above, and given the continuing efforts to secure 
new funding and a strategic long-term solution, the 
Directors continue to adopt the going concern basis 
of accounting. However, should such solution not be 
found, the Directors will need to reassess the Group’s 
ability to continue as a going concern.

The Directors consider the Group is a going concern, 
recognising that the Group will require additional 
funding, and the successful completion of the 
initiatives stated above to enable the Group to 
continue to fund its operations during the twelve 
month period from the date of signing this Financial 
Report. If the Group is unable to successfully secure 
additional funding and complete these initiatives 
there is a material uncertainty that may cast doubt 
on the Group’s ability to continue as a going 
concern, and therefore it may be unable to realise 
its assets and discharge its liabilities in the normal 
course of business and at the amounts stated in the 
ﬁnancial statements.

Basis of measurement
The ﬁnancial report is prepared on a historical cost 
basis, except for derivative ﬁnancial instruments that 
have been measured at fair value.

Functional and presentation currency
The consolidated ﬁnancial statements are presented 
in United States dollars (US$), which is the Company’s 
presentation currency.

Use of estimates and judgements
The preparation of the ﬁnancial report requires 
management to make judgments, estimates and 
assumptions that affect the application of accounting 
policies and the reported amounts of assets and 
liabilities, income and expenses. Actual results may 
differ from these estimates. Estimates and underlying 
assumptions are reviewed on an ongoing basis. 
Revisions to accounting estimates are recognised in 
the period in which the estimate is revised and in any 
future periods affected.

The estimates and assumptions that have a signiﬁcant 
risk of causing a material adjustment to the carrying 
amounts of assets and liabilities within the next 
ﬁnancial year and judgments, apart from those 
involving estimations, which have the most signiﬁcant 
effect on the amounts recognised in the ﬁnancial 
statements, are as follows:

(i) Impairment
The recoverability of the carrying amount of 
property, plant and equipment and mineral interests 
has been reviewed by the Company. In conducting 
the review, the recoverable amount has been 
assessed by reference to the higher of ‘fair value less 
costs to sell’ and ‘value in use’. In determining value in 
use, future cash ﬂows are based on estimates of:
 – Quantities of ore reserves and mineral resources;
 – Future production levels and sales;
 – Timing of future production;
 – Future exchange rates;
 – Future commodity prices; and
 – Future cash costs of production and capital 

expenditure.

The recoverable amount is sensitive to the discount 
rate used in the discounted cash ﬂow model as 
well as the expected cash inﬂows. Additionally the 
recoverability of the Company’s investments in its 
subsidiaries has been reviewed. Variations to the 
expected future cash ﬂows, and timing thereof, 
could result in signiﬁcant changes to the impairment 
test results, which could in turn impact future 
ﬁnancial results.

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35

 
 
 
 
Notes to the Financial Statements

For the year ended 31 December 2014

requires management to estimate in which phase 
the project is and make assumptions regarding 
the expected future cash generation of the assets, 
discount rates to be applied and the expected 
period of beneﬁts. At 31 December 2014, the Group’s 
carrying amount of capitalised mine properties was 
US$39,537,000 (2013: US$60,071,000).

(v) Functional currency
Companies in the Group have to determine their 
functional currencies based on the primary economic 
environment in which each entity operates. In order 
to do that, the management has to analyse several 
factors, including which currency mainly inﬂuences 
sales prices of product sold by the entity, which 
currency inﬂuences the main expenses of providing 
services, in which currency the entity has received 
ﬁnancing, and in which currency it keeps its receipts 
from operating activities.

For Sydvaranger Gruve AS, the above indicators are 
mixed and the functional currency is not obvious. 
Management used its judgment to determine which 
factors are most important and concluded the US$ is 
the functional currency for that company.

For Northern Iron Marketing AG, management have 
determined that the US$ is the functional currency 
for that company given that its revenue will mostly 
be in US$ and it has very few expenses in other 
currencies.

For Northern Iron Limited, management have 
determined that the Australian dollar is the functional 
currency for that company given that its revenue and 
expenses will mostly be in A$.

The presentation currency of Northern Iron Limited 
and the Group is US$.

(vi) Deferred waste
The Group has adopted a policy of deferring all 
waste development costs and amortising them in 
accordance with the accounting policy in Note 2(vii) 
below. Signiﬁcant judgement is required in 
determining the amortisation rate. Factors that are 
considered include:
 – Any proposed changes in the design of the mine;
 – Estimates of the quantities of ore reserve and 

mineral resources for which there is a high degree 
of conﬁdence of economic extraction;

 – Future production levels;
 – Future commodity prices; and
 – Future cash costs of production and capital 

expenditure.

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Note 2. Basis Of Preparation Of The Financial 
Report (continued)
The Company has prepared a budget for the life 
of the mine which indicates that the impairment 
loss recorded in the ﬁnancial statements as at 
31 December 2014 is sufficient based on the internal 
assumptions, estimates and judgements. This budget 
assumes that production targets will be met and 
iron ore prices will be in line with market prices of 
quarter 4 2014 and that the concentrate tonnage 
produced will be sold. The Company cannot foresee 
developments in prices or that the concentrate 
tonnage will be produced and sold as contemplated 
under the sales arrangements in place. In the event 
that production targets were not met or prices were 
to fall signiﬁcantly further and/or customers were 
unable to take the committed tonnage, the Company 
may need to raise additional funding to be a going 
concern.

(ii) Deferred tax asset
Deferred tax assets are recognised for all unused tax 
losses to the extent that it is probable that taxable 
proﬁt will be available against which the losses can 
be utilised. Signiﬁcant management judgment is 
required to determine the amount of deferred tax 
assets that can be recognised, based upon the likely 
timing and level of future taxable proﬁts together 
with future tax planning strategies. The Group’s 
carrying value of recognised deferred tax assets at 
31 December 2014 was US$nil (2013: US$31,309,000). 
The estimated value of Group unrecognised deferred 
tax assets at 31 December 2014 was US$86,672,000 
(2013: US$14,763,000). For reasons of prudency, the 
deferred tax asset has been derecognised as a direct 
consequence of the falling iron ore prices and the 
comprehensive requirements in IAS 12 for recognition 
of tax assets.

(iii) Provisions
The Group has recognised provisions for an onerous 
sales contract, environmental restoration, post-
closure tailings monitoring, and mining ﬂeet and 
automobile insurance. These provisions are measured 
based on the management’s estimates of:
 – probable amount of resources that will be required 

to settle the obligation; and

 – timing of settlement.

Such estimates are subjective and there may be a 
need to correct the book value of the provisions as a 
result of changes in estimates.

(iv)  Exploration for, evaluation of and development 

of mineral resources

Expenses for exploration, evaluation and 
development of mineral resources are capitalised in 
accordance with the accounting policy in Notes 3(g) 
and 3(i). Determining the amount to be capitalised 

36 Northern Iron Annual Report 2014

 
 
 
 
(vii) Unit of production method of depreciation
The Group applies the units of production method of 
depreciation to its mine assets based on ore tonnes 
mined. These calculations require the use of estimates 
and assumptions. Signiﬁcant judgement is required 
in assessing the available reserves and resources 
and the production capacity of the operations 
to be depreciated under this method. Factors 
that are considered in determining reserves and 
resources and production capacity are the Group’s 
history of converting resources to reserves and the 
relevant time frames, the complexity of metallurgy, 
markets, and future developments. The Group 
uses economically recoverable mineral resources 
(comprising proven and probable reserves plus, 
where appropriate, a portion of measured resources) 
to depreciate assets on a unit of production basis. 
However, where a mineral interest has been acquired, 
and an amount has been attributed to the fair value 
of resources not yet designated as reserves, the 
additional resources have been taken into account. 
When these factors change or become known in the 
future, such differences will impact pre-tax proﬁt and 
carrying values of assets.

(viii) Leased assets and ﬁnance lease liability
Sydvaranger Gruve AS has a ﬁnance lease agreement 
with a related company, Tschudi Bulk Terminal AS, 
regarding concentrate storage, handling and ship 
loading facilities. These assets were initially recorded 
in the ﬁnancial statements with an amount of 
US$27,900,000 together with an equivalent ﬁnance 
lease liability. Payments of principal and interest 
amounting to US$3,115,000 were made toward the 
lease obligation during 2014. The lease payment ends 
in December 2018. However, the lease will be in effect 
until 31 December 2034 with the option to extend 
for two periods each of ten years. Repayments on 
the facility are in NOK, payable monthly and include 
interest at a rate of 8.42% per annum.

Note 3. Signiﬁcant Accounting Policies
The accounting policies set out below have been 
applied consistently to all periods presented in 
the consolidated ﬁnancial report. The accounting 
policies have been applied consistently by all entities 
in the Group.

Comparative ﬁgures
When required by Accounting Standards, comparative 
ﬁgures have been adjusted to conform to changes in 
presentation for the current ﬁnancial year.

Basis of consolidation

(a) Subsidiaries
The consolidated ﬁnancial report comprises the 
ﬁnancial statements of the Company and its 
controlled entities. A controlled entity is any entity 
controlled by the Company whereby the parent entity 

has the power to control the ﬁnancial and operating 
policies of an entity so as to obtain beneﬁts from its 
activities.

All inter-company balances and transactions between 
entities in the Group, including any unrealised proﬁts 
or losses, have been eliminated on consolidation.

Accounting policies of subsidiaries have been 
changed where necessary to ensure consistency with 
those applied by the parent entity.

Where a subsidiary enters or leaves the Group 
during the year, its operating results are included or 
excluded from the date control was obtained or until 
the date control ceased.

Investments in subsidiaries are carried at cost in the 
Company’s ﬁnancial statements.

Northern Iron Marketing AG was established in April 
2009 for the purpose of sales and marketing of iron 
ore concentrate from the Sydvaranger iron project.

In July 2012 Sydvaranger Gruve AS registered a new 
subsidiary, Sydvaranger Malmtransport AS (SMT) to 
manage and operate the railway between Kirkenes 
and Bjørnevatn. Due to Sydvaranger Gruve’s 100% 
ownership of SMT and itself being owned 100% by 
the parent company, Northern Iron Limited, the 
Company was successful in its application to the tax 
authorities (Skattedirektoratet) to avoid consolidation 
at the SVG/SMT level. SMT has remained mostly 
inactive during the 2014 year with mainly accounting 
fees and taxation assistance being expensed during 
the period. Therefore the carrying amount of the 
investment in the subsidiary of US$19,000 remains 
unchanged from inception.

(b) Business combinations
All business combinations are accounted for by 
applying the purchase method which includes the 
reverse acquisition method. Cost is measured as 
the fair value of the assets given, shares issued or 
liabilities incurred or assumed at the date of exchange 
plus costs directly attributable to the acquisition.

Identiﬁable assets acquired and liabilities and 
contingent liabilities assumed in a business 
combination are measured initially at their fair 
values at acquisition date. The excess of the cost 
of acquisition over the fair value of the Group’s 
share of the identiﬁable net assets acquired is 
recorded as goodwill. If the cost of acquisition is 
less than the Group’s share of the fair value of the 
identiﬁable net assets of the subsidiary acquired, the 
difference is recognised directly in the Statement 
of Comprehensive Income, but only after a 
reassessment of the identiﬁcation and measurement 
of the net assets acquired.

37

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Notes to the Financial Statements

For the year ended 31 December 2014

(d)  Recoverable amount of assets and impairment 

testing

Assets that have an indeﬁnite useful life are not 
subject to depreciation and are tested annually for 
impairment by estimating their recoverable amount.

Assets that are subject to depreciation are reviewed 
annually to determine whether there is any indication 
of impairment. Where such an indicator exists, a 
formal assessment of recoverable amount is then 
made. Where this is in excess of carrying amount, the 
asset is written down to its recoverable amount.

Recoverable amount is the greater of fair value less 
costs to sell and value in use. Value in use is the 
present value of the future cash ﬂows expected 
to be derived from the asset or cash generating 
unit. In estimating value in use, a pre-tax discount 
rate is used which reﬂects the current market 
assessments of the time value of money and the 
risks speciﬁc to the asset. Any resulting impairment 
loss is recognised immediately in the Statement of 
Comprehensive Income.

(e) Trade receivables
Trade receivables are stated at fair value and 
subsequently measured at amortised cost, less 
impairment losses. Impairment testing is carried out 
in accordance with Note 3(d).

(f) Inventories
Inventories are stated at the lower of cost and net 
realisable value. Net realisable value is the estimated 
selling price in the ordinary course of business less 
any estimated selling costs. Cost includes those costs 
incurred in bringing each component of inventory to 
its present location and condition.

(g) Mine properties
Mine property and development assets include 
costs transferred from exploration and evaluation 
assets once technical feasibility and commercial 
viability of an area of interest are demonstrable, 
together with subsequent costs to develop the 
asset to the production phase. Where the directors 
decide that speciﬁc costs will not be recovered from 
future development, those costs are charged to the 
Statement of Comprehensive Income during the 
ﬁnancial period in which the decision is made.

Depreciation of mining property and development 
costs is calculated on a unit of production basis so as 
to write off the costs in proportion to the depletion of 
the estimated recoverable reserves.

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Note 3. Signiﬁcant Accounting Policies 
(continued)
Where settlement of any part of cash consideration 
is deferred, the amounts payable in the future are 
discounted to their present value as at the date of 
exchange using the entity’s incremental borrowing rate.

Goodwill on business combination
Goodwill represents the differences between the cost 
of the acquisition and the fair value of the identiﬁable 
net assets acquired. Goodwill is stated at cost less 
any accumulated impairment losses.

Goodwill is not amortised but is allocated to cash 
generating units and tested annually for impairment.

(c) Income tax
The charge for current income tax expense is based 
on the result for the year adjusted for any non-
assessable or disallowed items. It is calculated using 
tax rates that have been enacted or are substantively 
enacted by balance date.

Deferred tax is accounted for using the liability 
method in respect of temporary differences arising 
between the tax bases of assets and liabilities and 
their carrying amounts in the ﬁnancial statements. 
No deferred income tax will be recognised from the 
initial recognition of an asset or liability, excluding 
a business combination, where there is no effect on 
accounting or taxable proﬁt or loss.

Deferred tax is calculated at the tax rates that are 
expected to apply to the period when the asset 
is realised or liability is settled. Deferred tax is 
recognised in the Statement of Comprehensive 
Income except where it relates to items recognised 
directly in equity, in which case it is recognised in 
equity. Deferred income tax assets are recognised 
for deductible temporary differences and unused 
tax losses only if it is probable that future taxable 
amounts will be available to utilise those temporary 
differences and tax losses. Deferred tax assets and 
liabilities are offset when they relate to income taxes 
levied by the same taxation authority and the Group 
intends to settle its current tax assets and liabilities 
on a net basis.

The amount of beneﬁts brought to account or 
which may be realised in the future is based on 
the assumption that no adverse change will occur 
in income taxation legislation and the anticipation 
that the economic entity will derive sufficient future 
assessable income to enable the beneﬁt to be realised 
and comply with the conditions of deductibility 
imposed by the law. The carrying amount of deferred 
tax assets is reviewed at each balance date and 
only recognised to the extent that sufficient future 
assessable income is expected to be obtained.

38 Northern Iron Annual Report 2014

 
 
 
 
(h) Property, plant and equipment

Recognition and measurement
All property, plant and equipment are stated at cost 
less accumulated depreciation and impairment losses. 
The cost of an item also includes the initial estimate 
of the costs of dismantling and removing an item and 
restoring the site on which it is located.

Subsequent costs are included in the asset’s 
carrying amount or recognised as a separate 
asset, as appropriate, only when it is probable 
that future economic beneﬁts associated with the 
item will ﬂow to the Group and the cost of the 
item can be measured reliably. All other repairs 
and maintenance are charged to the Statement of 
Comprehensive Income during the ﬁnancial period 
in which they are incurred.

Impairment
The carrying amount of property, plant and 
equipment is reviewed at each balance date to 
determine whether there are any objective indicators 
of impairment that may indicate the carrying 
values may not be recoverable in whole or in part. 
Impairment testing is carried out in accordance with 
Note 3(d). Where an asset does not generate cash 
ﬂows that are largely independent it is assigned to a 
cash generating unit and the recoverable amount test 
applied to the cash generating unit as a whole.

If the carrying value of the asset is determined to be 
in excess of its recoverable amount, the asset or cash 
generating unit is written down to its recoverable 
amount.

Depreciation
Depreciation on plant and equipment is calculated on 
a straight line basis over expected useful life to the 
Group commencing from the time the asset is held 
ready for use. The following useful lives are used in 
the calculation of depreciation:

Buildings 

Plant and equipment 

Railway and rolling stock 

Mobile ﬂeet 

Furniture, ﬁxtures and office 
equipment 

Licenses 

20 years

15 to 20 years

15 to 20 years

4 to 10 years

3 to 10 years

5 years

Assets held under a ﬁnance lease are depreciated 
over their expected useful lives on the same basis 
as owned assets or, where shorter, the term of the 
relevant lease.

The assets’ residual values and useful lives are 
reviewed, and adjusted if appropriate, at least 
annually.

An asset’s carrying amount is written down 
immediately to its recoverable amount if the asset’s 
carrying amount is greater than its estimated 
recoverable amount.

Gains and losses on disposals are determined by 
comparing proceeds with the carrying amount. These 
gains and losses are included in the Statement of 
Comprehensive Income.

(i) Intangible assets

Exploration and evaluation expenditure
Exploration and evaluation expenditure incurred is 
accumulated in respect of each identiﬁable area of 
interest. These costs are only carried forward to the 
extent that the Group’s rights of tenure to the area 
are current and that the costs are expected to be 
recouped through the successful development of 
the area, or where activities in the area have not yet 
reached a stage that permits reasonable assessment 
of the existence of economically recoverable 
reserves.

Each area of interest is assessed for impairment to 
determine the appropriateness of continuing to carry 
forward costs in relation to that area of interest. 
Impairment testing is carried out in accordance 
with Note 3(d). Accumulated costs in relation to an 
abandoned area are written off in full against proﬁt 
in the year in which the decision to abandon the area 
is made.

Once the technical feasibility and commercial viability 
of the extraction of mineral resources in an area of 
interest are demonstrable, exploration and evaluation 
assets attributable to that area of interest are ﬁrst 
tested for impairment and then reclassiﬁed from 
intangible assets to mine properties.

(j) Provisions
Provisions are recognised when the Group has a legal 
or constructive obligation, as a result of past events, 
for which it is probable that an outﬂow of economic 
beneﬁts will result and that outﬂow can be reliably 
measured. Provisions are determined by discounting 
the expected future cash ﬂows at a pre-tax discount 
rate that reﬂects current market assessments of the 
time value of money and, where appropriate, the risks 
speciﬁc to the liability.

Restoration costs
The amount of the provision for future restoration 
and rehabilitation costs is capitalised and depreciated 
in accordance with the policy set out in Note 3(g). 
The unwinding of the effect of discounting on the 
provision is recognised as an interest cost.

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39

 
 
 
 
Notes to the Financial Statements

For the year ended 31 December 2014

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Note 3. Signiﬁcant Accounting Policies 
(continued)

(k) Segment reporting
A business segment is a group of assets and 
operations engaged in providing products or services 
that are subject to risks and returns that are different 
to those of other business segments. A geographical 
segment is engaged in providing products or 
services within a particular economic environment 
and is subject to risks and returns that are different 
from those of segments that are operating in other 
economic environments.

(l) Leases
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. Leases 
which transfer to a lessee substantially all the risks 
and beneﬁts incidental to ownership of the leased 
asset are classiﬁed as ﬁnance leases. Other lease 
agreements are treated as operating leases.

Finance leases are capitalised at the inception of the 
lease at the fair value of the leased assets or, if lower, 
at the present value of the minimum lease payments. 
Lease payments are apportioned between the ﬁnance 
charges and reduction of the lease liability so as to 
achieve a constant rate of interest on the remaining 
balance of the liability. Finance charges are charged 
directly against income except for borrowing costs 
related to the ﬁnancing of the assets constructed for 
own use (during the construction period). Capitalised 
leased assets are depreciated over the shorter of the 
estimated useful life of the asset and the lease term, 
if there is no reasonable certainty that the Company 
will obtain ownership by the end of the lease term.

Operating lease payments are recognised as an 
expense in the Statement of Comprehensive Income 
on a straight-line basis over the lease term.

(m) Investments and other ﬁnancial assets
The Group determines the classiﬁcation of its 
ﬁnancial instruments at initial recognition and  
re-evaluates this designation at each reporting date.

Fair value is the measurement basis, with the 
exception of held-to-maturity investments and 
loans and receivables which are measured at 
amortised cost. Fair value is inclusive of transaction 
costs. Changes in fair value are either taken to the 
Statement of Comprehensive Income or to an equity 
reserve (refer below).

Fair value is determined based on current bid prices 
for all quoted investments. If there is not an active 
market for a ﬁnancial asset fair value is measured 
using established valuation techniques.

40 Northern Iron Annual Report 2014

The Group assesses at each balance date whether 
there is objective evidence that a ﬁnancial asset or 
group of ﬁnancial assets are impaired. In the case 
of equity securities classiﬁed as available-for-sale, 
a signiﬁcant or prolonged decline in the fair value of 
a security below its cost is considered in determining 
whether the security is impaired. If any such evidence 
exists, the cumulative loss is removed from equity 
and recognised in the Statement of Comprehensive 
Income.

(i) Financial assets at fair value through proﬁt and loss
A ﬁnancial asset is classiﬁed in this category if 
acquired principally for the purpose of selling in 
the short term or if so designated by management. 
Realised and unrealised gains and losses arising from 
changes in the fair value of these assets are included 
in the Statement of Comprehensive Income in the 
period in which they arise.

(ii) Loans and receivables
Loans and receivables are non-derivative ﬁnancial 
assets with ﬁxed or determinable payments that 
are not quoted in an active market and are stated 
at amortised cost using the effective interest rate 
method, less any impairment losses.

(iii) Held-to-maturity investments
These investments have ﬁxed maturities, and it is 
the Group’s intention to hold these investments to 
maturity. Held-to-maturity investments are stated 
at amortised cost using the effective interest rate 
method.

(iv) Available-for-sale ﬁnancial assets
Available for sale ﬁnancial assets, comprising 
principally marketable equity securities, are non-
derivatives that are either designated in this category 
or not included in any of the above categories. 
Available-for-sale ﬁnancial assets are reﬂected at 
fair value. Unrealised gains and losses arising from 
changes in fair value are taken directly to equity 
in an available-for-sale investments revaluation 
reserve. When securities classiﬁed as available-
for-sale are sold or impaired, the accumulated fair 
value adjustments are included in the Statement of 
Comprehensive Income as gains and losses from 
investment securities.

(v) Effective interest method
The effective interest method is a method of 
calculating the amortised cost of a ﬁnancial asset and 
of allocating interest income over the relevant period. 
The effective interest rate is the rate that exactly 
discounts estimated future cash receipts through 
the expected life of the ﬁnancial asset, or, where 
appropriate, a shorter period.

 
 
 
 
(n) Foreign currency

Functional and presentation currency
The functional currency of each of the Group’s 
entities is measured using the currency of the primary 
economic environment in which that entity operates 
(the “functional” currency). The consolidated ﬁnancial 
statements are presented in US$ which is the parent 
entity’s presentation currency.

Transactions and balances
Foreign currency transactions are translated into 
functional currency using the exchange rates 
prevailing at the date of the transaction. Foreign 
currency monetary assets and liabilities are translated 
at the exchange rate at Statement of Financial 
Position date. Non-monetary items measured at 
historical cost continue to be carried at the exchange 
rate at the date of the transaction.

Exchange differences arising on the translation of 
monetary items are recognised in the Statement of 
Comprehensive Income, except where deferred in 
equity as a qualifying cash ﬂow or net investment 
hedge.

Translation differences arising on non-monetary 
items, such as equities held at fair value through 
proﬁt and loss, are reported as part of the fair value 
gain or loss. Translation differences on non-monetary 
items, such as equities classiﬁed as available-for-sale 
ﬁnancial assets, are included in the fair value reserve 
in equity.

Foreign operations
The ﬁnancial performance and position of foreign 
operations whose functional currency is different 
from the Group’s presentation currency are translated 
as follows:
 – assets and liabilities are translated at exchange 

rates prevailing at Statement of Financial Position 
date.

 – income and expenses are translated at average 

exchange rates for the period.

Exchange differences arising on translation of 
foreign operations are transferred directly to the 
Group’s foreign currency translation reserve as a 
separate component of equity. These differences 
are recognised in the Statement of Comprehensive 
Income upon disposal of the foreign operation.

(o) Share capital
Incremental costs directly attributable to an equity 
transaction are shown as a deduction from equity, net 
of any recognised income tax beneﬁt.

(p) Earnings per share
The Group presents basic and diluted earnings per 
share (“EPS”) for its ordinary shares.

Basic EPS is calculated by dividing the result 
attributable to equity holders of the Company by the 
weighted number of shares outstanding during the 
period.

Diluted EPS is determined by adjusting the result 
attributable to ordinary shareholders and the 
weighted average number of ordinary shares 
outstanding for the effects of all potential ordinary 
shares, which comprise share options granted.

(q) Employee beneﬁts

Wages and salaries, annual leave
Provision is made for the Group’s liability for 
employee beneﬁts arising from services rendered by 
employees to balance date. Employee beneﬁts that 
are expected to be settled wholly within one year 
have been measured at the undiscounted amounts 
expected to be paid when the liability is settled, plus 
related on-costs.

(r)  Share based payments – shares, options and 

performance rights

The fair value of shares, share options and 
performance rights granted is recognised as an 
expense with a corresponding increase in equity. 
Fair value is measured at grant date and recognised 
over the period during which the grantees become 
unconditionally entitled to the shares or share 
options.

The fair value of share grants at grant date is 
determined by the share price at that time.

The fair value of share options at grant date is 
determined using a Black-Scholes option pricing 
model that takes into account the exercise price, the 
term of the option, any vesting and performance 
criteria, the share price at grant date, the expected 
price volatility of the underlying share, the expected 
dividend yield and the risk free rate for the term 
of the option. Upon the exercise of the option, the 
balance of the share-based payments reserve relating 
to the option is transferred to share capital.

The fair value of performance rights at grant date is 
calculated on assumptions in respect of market based 
vesting conditions, probabilities of achieving non-
market based performance hurdles, and volatility in 
Northern Iron’s share price.

(s) Cash and cash equivalents
Cash and cash equivalents comprise cash on hand, 
deposits held at call with banks, and other short-term 
highly liquid investments.

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41

 
 
 
 
Notes to the Financial Statements

For the year ended 31 December 2014

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Note 3. Signiﬁcant Accounting Policies 
(continued)

(t) Goods and services tax
Revenues, expenses, and assets are recognised net 
of the amount of Australian goods and services tax 
(“GST”) and Norwegian value added tax (“VAT”), 
except where the amount of GST or VAT incurred is 
not recoverable from the taxation authorities. In these 
circumstances the GST or VAT is recognised as part 
of the cost of acquisition of the asset or as part of the 
expense. Receivables and payables in the Statement of 
Financial Position are shown inclusive of GST and VAT.

Cash ﬂows are presented in the Statement of Cash 
Flows on a gross basis, except for the GST or VAT 
components of investing and ﬁnancing activities, 
which are disclosed as operating cash ﬂows.

(u) Trade and other payables
Trade and other payables are stated at amortised 
cost. The amounts are unsecured and usually paid 
within 45 days of recognition.

(v) Financial liabilities
Financial liabilities within the scope of AASB 39 are 
classiﬁed as ﬁnancial liabilities at fair value through 
the proﬁt or loss, borrowings, or as derivatives 
as hedging instruments in an effective hedge, as 
appropriate. The Group determines the classiﬁcation 
of its ﬁnancial liabilities at initial recognition.

All ﬁnancial liabilities are recognised initially at fair 
value and in the case of borrowings, plus directly 
attributable transaction costs.

The Group’s ﬁnancial liabilities include trade and 
other payables, borrowings and derivative ﬁnancial 
instruments.

Subsequent measurement
The measurement of ﬁnancial liabilities depend of 
their classiﬁcation as follows:

Financial liabilities at fair value through the proﬁt or loss
Financial liabilities at fair value through the proﬁt or 
loss includes ﬁnancial liabilities held for trading and 
ﬁnancial liabilities designated upon initial recognition 
as at fair value through proﬁt or loss.

Financial liabilities are classiﬁed as held for trading 
if they are acquired for the purpose of selling in the 
near term. This category includes derivative ﬁnancial 
instruments entered into by the Company that are 
not designated as hedging instruments in hedge 
relationships as deﬁned by AASB 39. Separated 
embedded derivatives are also classiﬁed as held 
for trading unless they are designated as effective 
hedging instruments.

Gains or losses on liabilities held for trading are 
recognised in the Statement of Comprehensive 
Income.

42 Northern Iron Annual Report 2014

Borrowings
After initial recognition, borrowings are subsequently 
measured at amortised cost using the effective 
interest rate method. Gains and losses are recognised 
in the Statement of Comprehensive Income when 
the liabilities are derecognised as well as through the 
Effective Interest Rate method (EIR) amortisation 
process.

Amortised cost is calculated by taking into account 
any discount or premium on acquisition and fee or 
costs that are an integral part of the EIR. The EIR 
is included in ﬁnance expense in the Statement of 
Comprehensive Income.

The EIR is a method of calculating the amortised 
cost of a ﬁnancial liability and of allocating interest 
expense over the relevant period. The effective 
interest rate is the rate that exactly discounts 
estimated future cash payments through the 
expected life of the ﬁnancial liability, or, where 
appropriate, a shorter period.

Derecognition
A ﬁnancial liability is derecognised when the 
obligation under the liability is discharged, cancelled, 
or expired.

Fair value of ﬁnancial instruments
The fair value of ﬁnancial instruments that are 
traded in active markets at each reporting date is 
determined by reference to quoted market prices or 
dealer price quotations.

For ﬁnancial instruments not traded in an active 
market, the fair value is determined using appropriate 
valuation techniques. Such techniques may include 
recent arm’s length market transactions, references 
to the current fair value of another instrument that is 
substantially the same, discounted cash ﬂow analysis 
or other valuation models.

(w) Interest expenses
Interest expenses comprise interest expense on 
borrowings and the unwinding of the discount 
on provisions.

(x) Derivative ﬁnancial instruments
The Group may use foreign currency contracts to 
hedge its risks associated with foreign currency 
ﬂuctuations. Such derivative ﬁnancial instruments 
are initially recognised at fair value on the date 
the derivative contract is entered into and are 
subsequently remeasured to fair value.

Any gains and losses arising from changes in the 
fair value of derivatives, except those that relate to 
the effective portion of cash ﬂow hedges, are taken 
directly to the proﬁt or loss for the year.

 
 
 
 
The fair value of forward exchange contracts is 
calculated by reference to current forward exchange 
rates for contracts with similar maturity proﬁles.

For the purpose of hedge accounting, hedges are 
classiﬁed as either fair value hedges when they hedge 
exposure to changes in the fair value of a recognised 
asset or liability; or cash ﬂow hedges where they 
hedge exposure to variability in cash ﬂows that is 
either attributable to a particular risk associated 
with a recognised asset or liability or a forecasted 
transaction.

Cash ﬂow hedges – forward foreign currency 
contracts
In relation to cash ﬂow hedges (forward foreign 
currency contracts) to hedge ﬁrm commitments 
which meet the conditions for hedge accounting, the 
portion of the gain or loss on the hedging instrument 
that is determined to be an effective hedge is 
recognised directly in other comprehensive income 
and the ineffective portion is recognised directly in 
proﬁt or loss.

When the hedged ﬁrm commitment results in the 
recognition of an asset or liability, then at the time the 
asset or liability is recognised, the associated gains 
or losses that had previously been recognised in 
equity are included in the initial measurement of the 
acquisition cost or other carrying amount of the asset 
or liability.

For all other cash ﬂow hedges, the gains or losses 
that are recognised in equity are transferred to the 
Statement of Comprehensive Income in the same 
year in which the hedged ﬁrm commitment affects 
the net proﬁt and loss, for example, when the sale 
occurs.

Hedge accounting is discontinued when the hedging 
instrument expires or is sold, terminated or exercised, 
or no longer qualiﬁes for hedge accounting.

At that point in time, any accumulated gain or loss on 
the hedging instrument recognised in equity is kept in 
equity until the forecast transaction occurs.

If a hedged transaction is no longer expected to 
occur, the net cumulative gain or loss recognised 
in equity is transferred to the Statement of 
Comprehensive Income.

(y) Revenue
Revenue is recognised and measured at the fair value 
of consideration received or receivable to the extent 
that it is probable that the economic beneﬁts will 
ﬂow to the entity and the revenue can be reliably 
measured. The following speciﬁc recognition criteria 
must also be met before revenue is recognised:

Sale of goods
Revenue is recognised when the signiﬁcant risks and 
rewards of ownership of the goods have passed to 
the buyer and can be measured reliably.

Interest
Revenue is recognised as interest accrues using the 
effective interest rate method. This is a method of 
calculating the amortised cost of a ﬁnancial asset and 
allocating the interest income over the relevant period 
using the effective interest rate, which is the rate 
that exactly discounts estimated future cash receipts 
through the expected life of the ﬁnancial asset to the 
net carrying amount of the ﬁnancial asset.

(z) Contingent liabilities
Contingent liabilities are deﬁned as:
 – possible obligations resulting from past events 
whose existence depends on future events;
 – obligations that are not recognised because it is 
not probable that they will lead to an outﬂow of 
resources; or

 – obligations that cannot be measured with sufficient 

reliability.

Contingent liabilities are not recognised in the 
Statement of Financial Position, but are disclosed 
in the notes to the ﬁnancial statements, with 
the exception of contingent liabilities where the 
probability of the liability occurring is remote.

(aa) Adoption of new and revised standards
For the year ended 31 December 2014, the directors 
have reviewed all of the new and revised Standards 
and Interpretations issued by the AASB that are 
relevant to its operations and effective for annual 
reporting periods beginning on or after 1 January 2014.

It has been determined by the directors that there 
is no impact, material or otherwise, of the new and 
revised Standards and Interpretations on its business 
and, therefore, no change is necessary to Group 
accounting policies.

The directors have also reviewed all new Standards 
and Interpretations that have been issued but are 
not yet effective for the year ended 31 December 
2014. As a result of this review, the directors have 
determined that there is no impact, material or 
otherwise, of the new and revised Standards and 
Interpretations on its business and, therefore, no 
change necessary to Group accounting policies.

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43

 
 
 
 
Notes to the Financial Statements

For the year ended 31 December 2014

Note 4. Revenue and Expenses

Revenue and expenses from continuing operations has been arrived at after 
(charging)/crediting:

Revenue

Sale of ore

Other operating income

Mining and processing expenses

Net ore inventory movement

Operational expenses of mining and production activities

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Freight costs

Utilities, maintenance

Real estate expenses

Personnel expenses

Other expenses

Depreciation and amortisation

Depreciation of property, plant and equipment

Amortisation expensed

Impairment losses

Impairment of property, plant and equipment

Impairment of mine properties

Administration expenses

Advisory services and other similar fees

Directors’ fees

Travel and accommodation

Other

Depreciation of non-current assets

Hedging loss(i)

Finance income

Interest – external parties

Finance and borrowing costs

Interest – external parties

Finance charges – changes in provisions

Total finance and borrowing costs

Operating expenses above includes

Notes

2014 
US$000

2013 
US$000

182,042

204,554

689

478

11

(10,245)

913

(81,368)

(83,875)

(5,893)

(5,149)

(35,305)

(39,249)

(4,060)

(4,014)

(42,435)

(43,609)

(1,602)

(319)

(180,908)

(175,302)

(19,589)

(20,946)

(3,748)

(1,342)

(23,337)

(22,288)

(56,972)

(14,328)

(71,300)

–

–

–

(1,949)

(3,099)

(244)

(462)

(289)

(471)

(2,768)

(3,505)

(7)

(5,430)

(33,435)

(8)

(7,372)

(6,702)

127

174

13

12

14

14

13

(4,041)

(4,600)

17

(10,094)

(105)

(14,135)

(4,705)

Operating lease rental – minimum lease payments

(4,356)

(4,103)

(i) 

 Hedging losses for the 2014 year of US$33,435,000 (2013: US$6,702,000) consists of realised gains of US$121,000 (2013: US$nil) and 
unrealised losses of US$876,000 (2013: US$1,267,000) on electricity hedging contracts, a net gain of US$7,246,000 (2013: US$5,300,000) on 
iron ore price hedging contracts, and realised losses of US$132,000 and unrealised losses of US$39,794,000 on foreign exchange contracts.

44 Northern Iron Annual Report 2014

 
 
 
 
Note 5. Auditors’ Remuneration

Audit services

Auditors of the Company (HLB Mann Judd)
 – for an audit or review of the ﬁnancial report

Other auditors (Ernst & Young AS)
 – for an audit or review of subsidiary Sydvaranger Gruve AS in Norway

Other auditors (Ernst & Young Ltd)
 – for an audit or review of subsidiary Northern Iron Marketing AG in Switzerland

Other services

Auditors of the Company
 – other services
 – taxation services

Other Auditors (Ernst & Young AS)
 – taxation services

2014 
US$

2013 
US$

78,396

83,300

146,677

125,746

42,286

38,935

3,852

4,686

–

4,056

18,334

25,787

294,231

277,824

Note 6. Earnings Per Share
The earnings and weighted average number of ordinary shares used in the calculation of basic and diluted 
earnings per share are as follows:

Basic loss per share from continuing operations (cents per share)

Loss used in calculating basic and diluted earnings per share

2014 
US$000

2013 
US$000

(37.30)

(180,695)

(0.34)

(1,654)

Number of shares

Weighted average number of ordinary shares used in calculating the basic 
earnings per share(i)

484,405,314 484,405,314

(i)  Options on issue are not considered dilutive in the current and prior year as they are anti-dilutive.

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

45

 
 
 
 
Notes to the Financial Statements

For the year ended 31 December 2014

Note 7. Income Tax Expense

Notes

2014 
US$000

2013 
US$000

Income tax expense/(benefit) recognised in profit or loss

The major components of the tax expense/(benefit) are:

Current tax payable

Movement in deferred tax

Income tax (benefit)/expense

The prima facie income tax benefit on pre-tax accounting profit from 
operations reconciles to the income tax (benefit)/expense in the financial 
statements as follows:

Loss before income tax

Income tax benefit calculated at 30%

Tax effect of:

Expenses that are not deductible in determining taxable profit

Unrealised derivative loss, representation, gifts and union membership fees

Unrealised permanent difference due to taxable income from currency  
gain/(loss) on interest bearing borrowings (unrealised)

Change in tax rate of subsidiaries operating in other jurisdictions

Derecognition of net deferred tax asset

Unrecognised deferred tax assets

Share-based payments expense

Different tax rates of subsidiaries operating in other jurisdictions

Under provision for income tax

Income tax (benefit)/expense

Unrecognised net deferred tax assets

Deferred tax assets have not been recognised in respect of the following 
items:

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

Statement of Financial Position

Deductible temporary differences

Tax losses

Accrued income

Statement of changes in equity

Share issue costs

46 Northern Iron Annual Report 2014

129

31,316

31,445

340

(6,687)

(6,347)

(149,250)

(8,001)

(44,775)

(2,400)

4,231

11,671

375

8

(9,716)

(5,497)

–

31,309

34,376

18

4,323

8

1,159

–

138

–

(130)

–

31,445

(6,347)

5,866

80,806

–

8,026

6,737

–

2

86,672

14,763

–

10

 
 
 
 
Note 8. Deferred Tax

Recognised net deferred tax assets

Deferred tax assets and liabilities have been recognised in respect of the 
following items:

Notes

2014 
US$000

2013 
US$000

Deferred tax assets, comprising:

Deductible temporary differences

Tax losses

Deferred tax liabilities, comprising:

Property, plant and equipment

Finance lease

Net deferred tax asset recognised

2

Change in deferred income tax relates to the following:

Balance at beginning of the year

Provisions

Losses carried forward

Others

Property, plant and equipment

Finance lease – concentrate storage, handling and ship loading facility

Change in tax rate

Balance at end of the year

3

–

3

–

–

–

3

501

68,335

68,837

33,214

4,313

37,527

31,309

31,309

24,622

(493)

(17)

(68,335)

3,018

(5)

33,214

4,313

–

3

(3)

4,674

175

(1,160)

31,309

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

Deferred tax assets are recognised for the carry-forward of unused tax losses and unused tax credits to the 
extent that it is probable taxable proﬁts will be available against which the unused tax losses/credits can be 
utilised. For reasons of prudency, the deferred tax asset has been derecognised as a direct consequence of the 
falling iron ore prices and the comprehensive requirements in IAS 12 for recognition of tax assets.

The Group has recognised deferred tax assets amounting to US$3,000 as of 31 December 2014 
(2013: US$31,309,000). The tax losses and credits, from which deferred tax assets arise, relate to Norwegian tax 
regulations under which tax losses are available indeﬁnitely for offset against future taxable proﬁts.

47

 
 
 
 
Notes to the Financial Statements

For the year ended 31 December 2014

Note 9. Trade and Other Receivables 

Current

Trade and other receivables(i)

VAT Refundable

Security deposit(ii)

Other receivable(iii)

Accrued income(iv)

Non-Current

Security deposits(v)

2014 
US$000

2013 
US$000

14,886

1,092

218

–

4,459

28,455

4,500

262

247

378

20,655

33,842

1,505

1,505

1,181

1,181

(i) 

 The average credit period on sales of iron ore is 43 days, and is interest free. No allowance for unrecoverable trade receivables has been 
made, determined by reference to past experience.

(ii)  Guarantee for operational payments.

(iii)  The receivable from EPC Norge AS in 2013 was received during 2014.

(iv)   Accrued income relates to carbon dioxide compensation for increased electricity prices as a result of the European Union’s emissions trading 

system. Also included is income from sales of ore concentrate.

(v)   Security deposits consist of accommodation rent agreement deposits and long-term deposits that can only be used for restoration works of 

mineral properties and post-closure monitoring of re-established marine life in the tailings deposit area of the fjord.

Note 10. Derivative Financial Assets

Current

Derivatives that are carried at fair value

Currency forward contracts

2014 
US$000

2013 
US$000

–

534

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

48 Northern Iron Annual Report 2014

 
 
 
 
Note 11. Inventory

Production supplies

Balance at the beginning of the year

Increase/(Decrease) in Production supplies

Balance at the end of the year

Work in progress

Balance at the beginning of the year

Increase/(Decrease) in Inventory volume

Increase/(Decrease) in Inventory valuation

Balance at the end of the year

Finished goods

Balance at the beginning of the year

Increase/(Decrease) in Inventory volume

Increase/(Decrease) in Inventory valuation

Balance at the end of the year

Total inventory

Balance at the beginning of the year

Increase/(Decrease) in Production supplies

Increase/(Decrease) in Inventory volume

Increase/(Decrease) in Inventory valuation

Balance at the end of the year

2014 
US$000

2013 
US$000

10,449

10,639

367

(190)

10,816

10,449

6,094

471

(2,289)

4,276

11,634

(4,104)

(2,854)

4,676

28,177

367

(3,632)

(5,144)

19,768

4,017

2,170

(93)

6,094

7,815

4,603

(784)

11,634

22,471

(190)

6,773

(877)

28,177

Inventories are stated at the lower of cost and net realisable value. At 31 December 2014 production supplies, 
were stated at cost whilst work-in-progress and ﬁnished goods were stated at net realisable value. At 
31 December 2013 production supplies, work-in-progress and ﬁnished goods were stated at cost. Cost comprises 
direct materials, direct labour and an appropriate proportion of variable and ﬁxed overhead expenditure, the 
latter being allocated on the basis of normal operating capacity. Net realisable value is the estimated selling price 
in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to 
make the sale.

Write downs of inventories to net realisable value recognised as an expense during the period to 31 December 
2014 amounted to US$5,144,000 (2013: US$nil) and are included in Note 4 “Net ore inventory movement”.

DNB Bank and Innovasjon Norge share a ﬁxed and ﬂoating charge over all inventories.

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

49

 
 
 
 
Notes to the Financial Statements

For the year ended 31 December 2014

Note 12. Mine Properties

Non-Current

Exploration and evaluation(i)

Mine property(ii)

Deferred waste(iii)

Balance at the end of the year

(i) Exploration and evaluation

Non-Current

Exploration and evaluation

Balance at beginning of the year

Additions

Amortisation

Balance at the end of the year

The recoupment of costs carried forward in relation to areas of interest in the 
exploration and evaluation phases is dependent on the successful development 
and commercial exploitation or sale of the respective areas.

(ii) Mine property

Non-Current

Mine property

Balance at beginning of the year

Additions

Write-offs(i)

Amortisation

Impairment(ii)

Balance at the end of the year

(iii) Deferred waste

Non-Current

Deferred waste

Balance at beginning of the year

Additions

Amortisation – included in net ore inventory movement

Balance at the end of the year

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

2014 
US$000

2013 
US$000

–

17

39,537

56,055

–

39,537

3,999

60,071

17

–

(17)

–

14

35

(32)

17

56,055

54,662

1,541

2,703

(1,906)

(1,825)

(14,328)

–

(1,310)

–

39,537

56,055

3,998

1,098

9,609

745

(5,096)

(6,355)

–

3,999

(i) 

 Mine property write-offs relates to a project for which the outcome of the work is uncertain, and to have economic beneﬁt would likely 
require signiﬁcant further capital investment.

(ii)  Refer to Note 14 for details of impairment.

50 Northern Iron Annual Report 2014

 
 
 
 
Note 13. Property, Plant and Equipment

Land & 
Buildings 
US$000

Plant &  
Equipment 
 (Owned) 
US$000

Plant &  
Equipment  
(Finance  
Lease) 
US$000

Railway & 
rolling  
stock 
US$000

Mobile  
Equipment  
(Owned) 
US$000

Mobile  
Equipment  
(Finance  
Lease) 
US$000

Furniture  
fixtures  
& office  
equipment 
US$000

Other  
items  
(Licenses) 
US$000

PPE under  
construction 
US$000

Pre- 
payments 
US$000

Total 
US$000

Gross carrying 
amount - at 
cost

As of  
1 January 2013 29,397

155,441

33,090

4,688

586

52,394

926

1,551

32,613

198 310,884

Additions

180

2,221

–

(30)

–

–

397

185

–

–

–

–

71

(1)

9

–

6,618

–

9,681

(3,050)

(198)

(3,279)

29,577

157,632

33,090

5,085

771

52,394

996

1,560

36,181

–

317,286

29,577

157,632

33,090

5,085

Additions

1,023

28,388

–

–

–

–

771

63

–

52,394

996

1,560

36,181

–

–

3

–

1,398

1,426

–

(28,388)

–

–

–

317,286

32,301

(28,388)

–

–

30,600 186,020

33,090

5,085

834

52,394

999

2,958

9,219

–

321,199

As of  
1 January 2013 (3,633)

(25,501)

(4,964)

(862)

(467)

(29,621)

(556)

(662)

(1,442)

(9,047)

(1,646)

(231)

(51)

(8,066)

(163)

(308)

(5,075) (34,548)

(6,610)

(1,093)

(518)

(37,687)

(719)

(970)

(5,075) (34,548)

(6,610)

(1,093)

(518)

(37,687)

(719)

(970)

(1,462)

(10,439)

(1,655)

(255)

(37)

(5,220)

(115)

(413)

(6,394)

(37,480)

(6,597)

(993)

(74)

(2,521)

(44)

(419)

(2,450)

–

–

–

–

–

–

–

(66,266)

(20,954)

–

(87,220)

–

–

–

(87,220)

(19,597)

(56,972)

(12,931) (82,467)

(14,862)

(2,341)

(629) (45,428)

(878)

(1,802)

(2,450)

– (163,788)

24,502

123,084

26,480

3,992

253

14,707

277

590

36,181

– 230,066

17,669

103,553

18,228

2,744

205

6,966

121

1,156

6,769

–

157,411

The decrease in the value of PPE under construction for the year ended 31 December 2014 reﬂects activities 
developing the mining and processing facilities being completed and reclassiﬁed.

51

Disposals/
Transfers

As of  
31 December 
2013

As of  
1 January 
2014

Disposals/
Transfers

As of  
31 December 
2014

Accumulated 
depreciation

Depreciation 
expense

As of  
31 December 
2013

As of  
1 January 
2014

Depreciation 
expense

Impairment 
write–off

As of  
31 December 
2014

Net book 
value

As of  
31 December 
2013

As of  
31 December 
2014

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

 
 
 
 
Notes to the Financial Statements

For the year ended 31 December 2014

Note 13. Property, Plant and Equipment (continued)
The amount of acquisitions in the cash ﬂow statement has also been inﬂuenced by the changes in payables for 
property, plant and equipment in the amount of US$1,067,000 (2013: US$3,312,000).

The Company also has approximately 20 million square meters of land with an acquisition cost of zero.

At the end of December 2014, the balance of property, plant and equipment includes US$9,487,000 (2013: 
US$14,707,000) of mining equipment under the DNB equipment ﬁnancing facility and US$24,828,000 
(2013: US$26,480,000) of goods storage and handling equipment under Tschudi Bulk Terminal AS ﬁnance lease.

Refer Note 18 (g) for details of assets used as security against borrowings. Refer Note 14 for details of 
impairment.

Note 14. Impairment of Assets
The Group reviews the carrying amount of its assets at each balance date. During the year ended 31 December 
2014 the following material events occurred which were considered indicators for impairment:
 – The benchmark China CFR 62% price of iron ore (which is an indicator of the Company’s realisable price) 

signiﬁcantly decreased in value from US$135 per dry metric tonne (dmt) as at 31 December 2013 to US$72/dmt 
as at 31 December 2014 - a reduction of 47%

Accordingly, the Group has performed an impairment test and based on this assessment, the following 
impairment amounts have been proportionately recognised on the following non-current assets.

Mine properties

Property, plant and equipment

Total impairment of non-current assets

2014 
US$000

2013 
US$000

14,328

56,972

71,300

–

–

–

The Group assessed the recoverable amount of the Cash Generating Unit (“CGU”) as at 31 December 2014 using 
the Value in Use (“VIU”) method, where VIU is assessed as the present value of future cash ﬂows expected to be 
derived from the CGU.

The following assumptions were used when determining the VIU for the CGU:
 – Cash ﬂow forecasts for the life of mine were based on recent actual performance, forecasts and anticipated 

revenues and estimated operating and sustainable capital costs

 – Cash ﬂows are presented in nominal pre-tax form with a 12% discount rate applied
 – Inﬂation estimate of 2% per annum
 – CFR China 62% price (in real terms) of 2015 at US$64, trending towards a long-term price of US$80
 – Exchange rates used are 2015: 7.88 NOK/US$ trending towards a long term rate of 7.12 NOK/US$.

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

Note 15. Trade and Other Payables

Current

Trade payables – third parties

Trade payables – related parties

Non-trade payables and accrued expenses – third parties

(i)  Trade payables are non-interest bearing and are normally settled on 30-day terms.

(ii)  Information regarding the effective interest rate and credit risk of current payables is set out in Note 28.

2014 
US$000

2013 
US$000

13,603

18,149

922

1,138

10,403

24,928

12,150

31,437

52 Northern Iron Annual Report 2014

 
 
 
 
Note 16. Derivative Financial Liabilities

Current

Derivatives that are carried at fair value

Iron ore contracts

Electricity contracts

Currency forward contracts

Note 17. Provisions

Current

Other(iii)

Long service leave and bonus provision(iv)

Provision for onerous contract(vi)

Balance at end of the year

Non-Current

Concentrate offtake agreement provision(i)

Environmental restoration provision(ii)

Long service leave and bonus provision(iv)

Post-closure tailings monitoring provision(v)

Provision for onerous contract(vi)

Balance at end of the year

(i) Concentrate offtake agreement provision

Current

Provision for concentrate offtake agreement

Balance at the beginning of the year

Utilised

Balance at the end of the year

Non-Current

Provision for concentrate offtake agreement

Balance at the beginning of the year

Provision recognised

Balance at the end of the year

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

2014 
US$000

2013 
US$000

–

818

39,794

40,612

5,717

1,346

–

7,063

2014 
US$000

2013 
US$000

103

–

5,636

5,739

5,786

1,893

30

80

4,307

12,096

89

276

–

365

–

1,805

25

17

–

1,847

2014 
US$000

2013 
US$000

–

–

–

–

5,786

5,786

1,575

(1,575)

–

–

–

In 2010 the Group recognised a provision for the settlement agreed with Tata, due to non-delivery of product 
meeting contract quality speciﬁcations. A ﬁnal agreement was signed in June 2011 resulting in a repayment 
schedule based upon tonnes shipped under the contract. The ﬁnal settlement of the provision occurred upon 
ﬁnal invoicing for the December quarter shipments during January 2013. The estimate was denominated in US$ 
and discounted to present value.

53

 
 
 
 
Notes to the Financial Statements

For the year ended 31 December 2014

Note 17. Provisions (continued)
During the September 2014 quarter, the Company announced it had reached an agreement with its largest 
customer to amend its offtake contract. Under the terms of the agreement, the Company will supply additional 
volumes with the pricing applied to tonnage sold during the period from July 2014 to March 2015 being similar 
to spot pricing arrangements. The deferral of the previous contract pricing arrangement will be repayable 
should the market pricing environment improve materially, or else following the end of the contract term in 
March 2018. For the year ended 31 December 2014, the deferred liability owing to the customer is approximately 
US$5.8 million.

(ii) Environmental Restoration Provision

Non-current

Site restoration:

Balance at beginning of the year

Effects of movements in foreign exchange

Interest

Balance at end of the year

2014 
US$000

2013 
US$000

1,805

–

88

1,893

1,879

(162)

88

1,805

The Company has recognised provisions regarding environmental restoration obligations due to current and 
previous mining activities and mining assets used. The probable timing of the settlement of the obligation is 
2042 based on an annual production rate of 2.3 million tonnes. The estimate for the environmental restoration 
provision has been reviewed for adequacy by the Group as at the reporting date and no material adjustment to 
the estimate was identiﬁed. The estimate is denominated in NOK and discounted to present value.

(iii) Other

Current

Other:

Balance at the beginning of the year

Provision recognised

Utilised

Balance at the end of the year

2014 
US$000

2013 
US$000

89

14

–

103

445

89

(445)

89

Other provisions mainly comprise provisions for bank and legal fees, as well as mining ﬂeet and automobile 
insurance.

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

54 Northern Iron Annual Report 2014

 
 
 
 
(iv) Long service leave and bonus provision

Current

Long service leave and bonus provision:

Balance at the beginning of the year

Provision recognised

Utilised

Balance at the end of the year

Non-Current

Long service leave and bonus provision:

Balance at the beginning of the year

Provision recognised

Utilised

Reclassified as current

Balance at the end of the year

(v) Post-closure tailings monitoring provision

Non-Current

Post-closure tailings monitoring provision:

Balance at the beginning of the year

Interest

Balance at the end of the year

2014 
US$000

2013 
US$000

276

–

(276)

–

25

5

–

–

30

–

276

276

310

168

(177)

(276)

25

2014 
US$000

2013 
US$000

17

63

80

–

17

17

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

During 2013, the Company has recognised provisions regarding post-closure monitoring of re-established marine 
life in the tailings deposit area of the fjord. The provision is according to a proposal submitted to and approved 
by the Norwegian Climate and Pollution Agency (KLIF) which is aligned with European Union Mineral Directive 
requirements. The estimate is denominated in NOK and discounted to present value.

(vi) Provision for onerous contract

Current

Provision for onerous contract:

Balance at the beginning of the year

Provision recognised

Balance at the end of the year

Non-Current

Provision for onerous contract:

Balance at the beginning of the year

Provision recognised

Balance at the end of the year

2014 
US$000

2013 
US$000

–

5,636

5,636

–

4,307

4,307

–

–

–

–

–

–

During 2014, the Company has recognised a provision for potential future losses occurring under a contract for 
iron ore sales.

55

 
 
 
 
Notes to the Financial Statements

For the year ended 31 December 2014

Note 18. Interest Bearing Liabilities and Borrowings

2014 

US$000

Innovasjon Norge 
financing facility (b)

Finance lease – 
concentrate storage, 
handling and ship 
loading facility (a) & (c)

Equipment lease 
financing facility  
(a) & (d)

DNB working capital 
facility (e)

DNB US$ loan (f)

2013  

US$000

Innovasjon Norge 
financing facility (b)

Finance lease – 
concentrate storage, 
handling and ship 
loading facility (a) & (c)

Equipment lease 
financing facility  
(a) & (d)

DNB working capital 
facility (e)

DNB US$ loan (f)

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

Notes

Current

Non- 
Current

Borrowings 
in total

Financing  
arrangements  
credit lines

Facilities 
utilised at  
balance  
date

Facilities  
not utilised  
at balance 
date

(b)

1,875

5,188

7,063

12,108

12,108

(c)

1,534

10,686

12,220

27,897

27,897

(d)

(e)

(f)

4,003

28,037

17

–

2,500

12,500

4,020

52,394

52,394

28,037

15,000

35,000

28,037

6,963

30,000

30,000

–

37,949

28,391

66,340

157,399

150,436

6,963

Notes

Current

Non-
Current

Borrowings 
in total

Financing 
arrangements 
credit lines

Facilities 
utilised at 
balance 
date

Facilities  
not utilised  
at balance 
date

(b)

2,466

7,555

10,021

14,794

14,794

(c)

3,671

13,056

16,727

34,085

34,085

(d)

(e)

(f)

5,463

4,051

9,514

52,394

52,394

33,648

–

33,648

35,000

33,648

5,000

12,308

50,248

36,970

17,308

87,218

30,000

30,000

166,273

164,921

1,352

–

1,352

–

–

–

–

–

–

56 Northern Iron Annual Report 2014

 
 
 
 
 
 
(a)  Financing lease commitments in respect of ﬁnance leases – concentrate storage, handling and ship 

loading and equipment lease ﬁnance

Finance lease commitments

Minimum lease payments

Not later than 1 year

Later than 1 year but not later than 5 years

Later than 5 years

Total future minimum lease payments

Less future finance charges

Present value of future minimum lease payments

2014 
US$000

2013 
US$000

6,651

12,130

–

10,626

18,948

–

18,781

29,574

(2,540)

(3,333)

16,241

26,241

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

Amounts repaid against the ﬁnance facilities are not able to be re-drawn except for the DNB working capital 
facility.

(b) Innovasjon Norge ﬁnancing facility
In July 2009, Sydvaranger Gruve AS signed agreements with Innovasjon Norge for three separate loans with 
seven-year terms, and a total value of NOK 90 million. The repayment grace period which has been granted for 
the period September 2014 to June 2015 after which, repayments on each loan will resume and will be made 
biannually, with loan 1 and 2 expiring June 2018, and loan 3 expiring August 2018.

In April 2014, Innovation Norge agreed to amend the security terms of the facility to enable the Company to 
extend its increase on the DNB working capital facility for the period to 31 May 2015.

In December 2014, the Company accepted an offer to defer interest payments for the period 1 January 2015 to 
31 March 2015.

The facility is not able to be re-drawn. Payments of dividends and changes to secured indebtedness require 
written approval from Innovasjon Norge. The facility incurs a ﬁxed weighted nominal interest rate of 5.16%.

(c) Finance lease – concentrate storage, handling and ship loading facility
Sydvaranger Gruve AS has a NOK denominated ﬁnance lease agreement with a related company, Tschudi Bulk 
Terminal AS regarding goods storage and handling assets, initially established in the ﬁnancial statements with 
an amount of US$33.7 million. The lease payment ends in December 2017. However, the lease will be in effect 
until 31 December 2034 with the option to extend for two periods each of ten years (without any further lease 
payments). Principal and interest on the facility is payable monthly at a rate of 8.42% per annum. The facility is 
not able to be re-drawn and there are no restrictions on dividends, further leasing or further borrowings.

In September 2014, the Company accepted an offer to defer lease repayments for 12 months effective from 
1 July 2014 and to extent the lease period by the same length of time. The lease payment period now ends 
on 31 December 2018. In December 2014 the two parties agreed to defer interest repayments for the period 
1 January 2015 to 31 March 2015.

(d) Equipment lease ﬁnancing facility
Sydvaranger Gruve AS established in October 2008 a ﬁnance lease facility with DNB for the purpose of 
ﬁnancing mining ﬂeet equipment. In April 2009, the facility was converted from being denominated in NOK, to 
being denominated in US$. The total facility is US$52.4 million (31.12.2013: US$52.4 million) and has the ability 
to be drawn in a number of currencies. As at 31 December 2014, US$52.4 million (31.12.2013: US$52.4 million) 
of equipment had been accepted under the facility and included in property, plant and equipment. The period 
of each lease was initially ﬁve years however in September 2013, DNB agreed to extend the lease periods by 
one year and in December 2014, agreed to defer lease and interest payments for the period 1 January 2015 
to 31 March 2015. Interest on the facility is payable quarterly at a ﬂoating rate based on the 3 month LIBOR 
rate plus 2.90%. As at 31 December 2014, the rate applied to drawings on the facility was 3.13% per annum 
(31.12.2013: 3.14% per annum). Under the terms of the agreement, interest cannot be charged on intercompany 
borrowings. The facility is not able to be re-drawn and there are no restrictions on dividends, further leasing or 
further borrowings.

57

 
 
 
 
Notes to the Financial Statements

For the year ended 31 December 2014

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

Note 18. Interest Bearing Liabilities and Borrowings (continued)

(e) DNB working capital facility
During the second quarter of 2011, Sydvaranger Gruve AS signed an agreement with DNB for a US$25 million 
working capital facility which is to be renewed yearly. The borrowing base constituted 80% of receivables and 
60% of inventory value. Effective from 1 May 2012 the current interest rate on drawn amounts for this facility was 
LIBOR plus 2.85% per annum (previously 3.50%), for the committed amount the commitment fee was 0.20% per 
quarter (previously 0.33%), both are payable quarterly in arrears.

The Company has in the past secured increases and extensions to the DNB working capital facility. As of April 
2014, the Company has renewed the DNB working capital facility at a limit of US$35 million until 31 May 2015, 
with the borrowing base constituting 85% of receivables and 70% of inventory value.

Due to the impact from falling iron ore prices through quarter two 2014, a waiver on the ﬁnancial covenants was 
granted by DNB and Innovasjon Norge for the quarter ending June 2014 and further extended in September 
2014 until 30 September 2015.

The applicable interest rate on drawn amounts for the facility is currently the US$ Federal Funds effective rate 
plus 2.75% per annum, with a commitment fee of 0.25% per quarter on the committed amount. Both are payable 
quarterly in arrears. The facility can be redrawn on an ongoing basis up to the approved limit. Payments of 
dividends require approval from DNB.

(f) DNB US$ loan
During the second quarter of 2011, Sydvaranger Gruve AS signed an agreement with DNB for a US$30 million 
US$ loan. The facility was partly drawn (with US$21 million) in 30 June 2011 and was used to repay the Credit 
Suisse and a short term US$5 million DNB ﬁnancing facilities. The second tranche of the loan (US$9 million) was 
made available in November 2011. This loan has a term of six years with semi-annual repayments with the ﬁrst on 
30 September 2011. Effective from 1 May 2012 the current interest rate is LIBOR plus 2.75% (previously 3.75%) per 
annum. The facility is not able to be re-drawn. Payments of dividends require approval from DNB.

In September 2014, the Company and DNB agreed to defer loan repayments for twelve months effective from 
1 July 2014 and to extent the loan period by the same length of time, with the ﬁnal due date then being 27 March 
2018. In December 2014, the Company accepted an offer to defer interest payments for the period 1 January 
2015 to 31 March 2015.

(g) Assets pledged as security
DNB and Innovasjon Norge share a ﬁxed and ﬂoating charge over all the assets and undertakings of 
Sydvaranger Gruve AS with the exception of the assets under ﬁnance lease and cash at bank consisting 
of withheld employee tax.

Tschudi Bulk Terminal AS is the legal owner and has security over the concentrate storage, handling and ship 
loading facility assets under the ﬁnance leases.

DNB is the legal owner and has security over the mining ﬂeet equipment assets under the ﬁnance lease.

Note 19. Capital and Reserves

Issued capital

2014 
Number

2014 
US$000

2013 
Number

2013 
US$000

Balance at beginning of the year

484,405,314

380,761 484,405,314

380,761

Shares cancelled

Share issue costs

–

–

–

–

–

–

–

–

Balance at end of the year

484,405,314

380,761 484,405,314

380,761

Ordinary shares have the right to one vote per share at meetings of the Company, to receive dividends as 
declared and, in the event of a winding-up of the Company, to participate in the proceeds from the sale of all 
surplus assets in proportion to the number of, and amounts paid up on, shares held.

The Company does not have an authorised capital or par value in respect of its issued shares.

58 Northern Iron Annual Report 2014

 
 
 
 
Translation reserve
Movements in the translation reserve are set out in the Statement of Changes in Equity on page 32. The 
translation reserve comprises all foreign exchange differences arising from the translation of non US$ 
denominated monetary assets and liabilities.

Share based payments reserve
Movements in the share based payments reserve are set out in the Statement of Changes in Equity on page 32. 
This reserve accumulates the fair value as at grant date of share options and performance rights issued. The fair 
value is recognised as an expense over the vesting period.

Note 20. Reconciliation of Cash Flows from Operating Activities

(a) Cash flows from operating activities

Loss from continuing operations

Adjustments for:

Share-based payments expense

Foreign exchange loss/(gain)

Depreciation of property, plant and equipment

Amortisation expensed

Depreciation of non-current assets

Impairment of property, plant and equipment

Impairment of mine properties

Changes in assets and liabilities:

(Increase)/decrease in trade and other receivables

(Increase)/decrease in inventory

Increase/(decrease) in trade and other payables

Increase/(decrease) in provisions

Accrued income

Accrued expenses

Prepayments

Derivative financial asset

Derivative financial liability

Deferred tax assets and liabilities

Net cash flows provided by operating activities

(b) Reconciliation of cash and cash equivalents

Cash at bank and at call

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

2014 
US$000

2013 
US$000

(180,695)

(1,654)

70

1,449

19,590

3,998

7

56,972

14,328

17,299

8,409

(5,037)

15,622

(4,081)

(1,375)

51

534

33,549

31,306

11,996

–

2,380

20,946

7,697

8

–

–

2,650

(5,706)

(5,978)

(1,722)

(379)

758

(67)

(534)

6,505

(6,347)

18,557

6,618

19,446

Cash at bank earns interest at ﬂoating rates based on daily bank deposit rates. Short-term deposits are made for 
varying periods of between one day and three months, depending on the immediate cash requirements of the 
Group, and earn interest at the respective short-term deposit rates.

In addition to these cash balances the Group has US$218,000 in lodged cash security deposits classiﬁed under 
trade and other receivables (2013: US$262,000) and US$1,505,000 (2013: US$1,181,000) included in non-current 
receivables.

59

 
 
 
 
Notes to the Financial Statements

For the year ended 31 December 2014

Note 21. Operating Leases

Non-cancellable operating lease commitments
The future minimum lease payments under non-cancellable operating leases are as follows:

Within 1 year

Between 2 and 5 years

More than 5 years

2014 
US$000

2013 
US$000

2,596

1,324

–

2,841

3,764

–

3,920

6,605

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

Note 22. Share-Based Payments

Employee share option plan
There were no share-based payment arrangements in existence during the current reporting period.

The following share-based payment arrangements were in existence during the prior reporting period:

Option series

J Sanderson

J Sanderson

J Sanderson

No. of 
options

Grant date Expiry Date

Exercise 
Price

Revised 
Exercise 
Price(ii)

Fair value  
at grant 
date

500,000(i)

14/05/2010 24/08/2013

 A$2.15 

 A$2.06 

 A$0.50 

500,000(i)

14/05/2010 24/08/2013

 A$2.50 

 A$2.41 

 A$0.44 

500,000(i)

14/05/2010 24/08/2013

 A$3.00 

 A$2.91 

 A$0.38 

(i) 

In accordance with the terms of the share based arrangement, options vest over the period of employment.

(ii)   In accordance with Listing Rule 6.22.2 the exercise price of unlisted options were changed as a result of a non-renounceable pro-rata 

entitlement offer.

(a) Fair value of options granted in the year
There were no options granted during the 2014 and 2013 ﬁnancial years.

(b) Movements in options during the period
The following table reconciles the number of options outstanding and the weighted average exercise price at the 
beginning and end of the year:

Balance at beginning of the year

Expired during the year

Balance at end of the year

Exercisable at end of the year

2014

Weighted 
average 
exercise 
price

Number of 
options

2013

Weighted 
average 
exercise 
price

Number of 
options

–

–

–

–

–

–

–

–

1,500,000

(1,500,000)

A$2.55

A$2.55

–

–

–

–

(c) Share options exercised during the year
There were no options were exercised during the 2014 and 2013 ﬁnancial years.

(d) Share options outstanding at the end of the year
The share options outstanding at the end of the prior year had an exercise price of A$nil, and a weighted average 
remaining contractual life of nil days.

Further details of shares and options issued to directors are set out in the Remuneration Report set out on 
pages 19 to 26.

60 Northern Iron Annual Report 2014

 
 
 
 
Performance rights
At the Company’s 2010 Annual General Meeting shareholders approved the establishment of the Northern 
Iron Limited Employee Performance Rights Plan, to provide ongoing incentives to executives, key employees 
and consultants of the Company to deliver long–term shareholder returns. Under the plan, participants are 
issued performance rights which only vest should certain performance and vesting conditions be achieved. 
Participation in the plan is at the discretion of the Board of Northern Iron Limited and no individual has a 
contractual right to participate in the plan.

The number of shares issued at the end of the vesting periods depend on three key performance indicators 
(“KPI”). They are a share price KPI, a total shareholder return (%) KPI, and a production KPI. Once vested the 
performance rights will expire after a period of three months. The Performance Rights shall vest according to the 
following schedule:

Vesting Date

01/09/2015

01/09/2015

31/12/2016

TOTAL

Hurdle Price

A$1.25

A$2.00

Total

–

–

50,000

50,000

50,000

50,000

1,000,000

–

1,000,000

1,000,000

100,000

1,100,000

Weighted average fair value per performance right

A$0.07

A$0.29

The fair value of performance rights was calculated based on the assumptions below:

Fair value at measurement date (cents)

Share price at date of issue 

Exercise prices

Performance right life 

2014

2013

A$0.07 to A$0.29

A$0.29 to A$0.94

A$0.18 to A$0.89

A$0.89 to A$2.02

A$1.25 to A$2.00

A$1.50 to A$3.50

0.9 to 2.2 years

0.4 to 3.6 years

Share-based payments expense recognised 

$70,000

–

For the year ended 31 December 2014 the total value of share-based payments expensed in the ﬁnancial 
statements is US$70,000 (2013: US$nil). There were no shares issued or payments made during the year under 
the performance rights plan (2013: US$nil).

Note 23. Capital And Other Commitments

Property, plant and equipment commitments
There are no commitments contracted at balance date not recognised as liabilities.

Lease commitments
Finance lease commitments and non-cancellable operating lease commitments are disclosed in Note 18 and 
Note 21 respectively.

Note 24. Related Party Disclosures 

Identity of related parties
The Company has a related party relationship with its legal subsidiaries (see below), as well as:
 – Tschudi Mining Company AS, Tschudi Shipping Company AS and Tschudi Bulk Terminal AS which are controlled 

by Mr Felix Tschudi, a Director. 

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

61

 
 
 
 
Notes to the Financial Statements

For the year ended 31 December 2014

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

Note 24. Related Party Disclosures (continued)
The consolidated ﬁnancial statements include the ﬁnancial statements of Northern Iron Limited and the 
subsidiaries listed in the following table:

Group Companies

Legal parent

Northern Iron Limited

Legal subsidiaries

Sydvaranger Gruve AS

Northern Iron Marketing AG

Legal subsidiary of Sydvaranger Gruve AS

Sydvaranger Malmtransport AS

Transactions within the wholly owned Group

Country of 
Incorporation

Ownership interest

2014

2013

Australia

Norway

Switzerland

100%

100%

100%

100%

Norway

100%

100%

Sydvaranger Gruve AS
During the reporting period loans from the Company to the subsidiary totalled US$5,650,000 (2013: 
US$16,219,000). The carrying value of the Company’s loans at 31 December 2014 was US$196,275,000 
(2013: US$239,097,000). Advances were made in NOK, US$, EUR and A$. 

The loans are secured by a second ranking ﬁxed and ﬂoating charge over Sydvaranger Gruve AS’s assets and are 
repayable by 31 December 2023 in accordance with the terms of a loan agreement. Under the terms of the loan 
agreement, borrowings are repayable after senior debt of the subsidiary is fully repaid.

The Group does not presently charge interest on the loan amount, being a restriction of the lease ﬁnancing 
facility with DNB.

During the reporting period, goods and services were purchased, or paid for on behalf of Sydvaranger Gruve 
AS, in the amount of US$622,000 (2013: US$919,000). During the reporting period, goods and services were 
purchased, or paid for by Sydvaranger Gruve AS on behalf of the Company in the amount of US$62,000 
(2013: US$nil).

During the reporting period Sydvaranger Gruve AS recorded sales of ore concentrate to Northern Iron Marketing 
AG in the amount of US$44,503,000 (2013: US$36,897,000), and purchased services from Northern Iron 
Marketing AG in the amount of US$222,000 (2013: US$1,667,000). 

Northern Iron Marketing AG
During the reporting period, loans from the Company to the subsidiary totalled US$nil (2013: US$nil). The 
carrying value of the Company’s loans to Northern Iron Marketing AG at 31 December 2014 was US$nil 
(2013: US$808,000). 

Sydvaranger Malmtransport AS
In July 2012 Sydvaranger Gruve AS registered a new subsidiary, Sydvaranger Malmtransport AS (SMT) to 
manage and operate the railway between Kirkenes and Bjørnevatn. Due to SVG’s 100% ownership of SMT and 
itself being owned 100% by the parent company, Northern Iron Limited, SVG was successful in its application to 
the tax authorities (Skattedirektoratet) to avoid consolidation at the SVG/SMT level. SMT has remained mostly 
inactive during the 2014 year with only business registration and accounting fees being expensed during the 
period. Therefore the carrying amount of the investment in the subsidiary of US$19,000 remains unchanged 
from inception. There were no purchases or sales between SVG and SMT during the year.

62 Northern Iron Annual Report 2014

 
 
 
 
Transactions with key management personnel
During the reporting period, the Group paid US$57,000 (2013: US$147,000) to companies which are associated 
with Mr Ashwath Mehra, a Director, for services to provide office space, administration and ancillary support 
services. At balance date one quarter amounting to US$16,000 is payable.

During the reporting period services were purchased from PSL Invest AS, which is 100% owned by alternate 
director Mr Peter Steiness Larsen, for support in connection with securing ﬁnancing for the Company and 
assisting with various treasury activities in the amount of US$31,000 (2013: US$30,000).

Transactions with other related parties
Sydvaranger Gruve AS had transactions in the following amounts with companies which are ultimately controlled 
by Tschudi Shipping Company AS. These transactions are in the normal course of business and on normal terms 
and conditions:
 – services purchased in the amount of US$4,660,000 (2013: US$6,514,000) which includes leases for land and 
properties, contract labour services, freight, tugboat and harbour services and production of aggregate from 
waste rock;

 – capitalised expenses and assets purchased in the amount of US$nil (2013: US$48,000), primarily being for 

contract labour services utilised on construction and capital installation projects; and

 – repayments of principal and interest under the ﬁnance lease from Tschudi Bulk Terminal AS in the amount of 
US$3,115,000 (2013: US$5,136,000). This lease represents an agreement for handling, storage and loading of 
iron ore concentrate (included in the balance of borrowings – see Note 18). This facility was fully utilised in 2010 
and therefore had no additional drawdowns in 2013 or 2014.

As a result of the transactions described above the Group has trade payables and accruals owing to subsidiaries 
of Tschudi Shipping Company AS for the amount of US$776,000 (2013: US$1,144,000).

Terms and conditions of transactions with related parties 
Sales to and purchases from related parties are made in arm’s length transactions both at normal market prices 
and on normal commercial terms.

With the exception of the loan to Sydvaranger Gruve AS, outstanding balances are unsecured, interest free and 
settlement occurs in cash.

Note 25. Segment Information
For management purposes, the Board of Directors of Northern Iron Limited has been deﬁned as the Chief 
Operating Decision Maker. Segment information is presented in respect of the Group’s business segments based 
on the Group’s management and internal reporting structure. 

The Group has three reporting segments, being Sydvaranger Iron Ore Project, marketing of ore concentrate and 
corporate office. Intersegment pricing is determined on an arm’s length basis. Segment results and assets include 
items directly attributable to a segment as well as those that can be allocated on a reasonable basis. 

The following table presents the ﬁnancial information regarding these segments provided to the Board of 
Directors for the year ended 31 December 2014 and 31 December 2013.

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
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I

N
R
E
H
T
R
O
N

63

 
 
 
 
4
1
0
2
T
R
O
P
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R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

Notes to the Financial Statements

For the year ended 31 December 2014

Note 25. Segment Information (continued)

Information on business segments

2014

Business Segments

External revenue 

Inter segment revenue(i)

Segment assets

Segment liabilities

Segment (loss)/profit before income tax

(149,550)

Sydvaranger 
Iron Ore 
Project 
(US$000)

Marketing 
(US$000)

Corporate 
(US$000)

Inter-
segment 
eliminations 
(US$000)

Consolidated 
(US$000)

131,344

49,213

51,387

5,298

180,557

56,685

974

3,578

241,763

(346,286)

(704)

–

91

91

–

182,731

(54,602)

–

(54,602)

182,731

13,472

(14,147)

(149,250)

2,139

(355)

(1,734)

245,746

197,501

(149,844)

Other segment information:

Segment result before tax includes:

Finance income

Finance expense

Depreciation and amortisation

Depreciation and amortisation – included in 
administration

107

(14,133)

(23,337)

–

Acquisition of property, plant and equipment 

32,302

–

–

–

–

–

20

(2)

–

(7)

–

–

–

–

–

–

127

(14,135)

(23,337)

(7)

32,302

(i) 

 Intersegment revenue is recorded at amounts equal to competitive market prices charges to external customers for similar goods and 
services and is eliminated on consolidation.

Sydvaranger 
Iron Ore 
Project  
(US$000) 

Marketing 
(US$000)

Corporate  
(US$000)

Inter-
segment 
eliminations 
(US$000)

Consolidated  
(US$000)

239,065

(36,897)

202,168

(9,587)

396,137

2,386

36,897

39,283

2,219

17,678

(128,388)

(15,641)

–

–

–

(36,897)

204,554

 –

–

(36,897)

204,554

35,751

(36,384)

(8,001)

7,811

(356)

(16,668)

404,958

16,115

(128,270)

2013

Business Segments

External revenue 

Inter segment revenue(i)

Segment (loss)/profit before income tax

Segment assets

Segment liabilities

Other segment information:

Segment result before tax includes:

Finance income

Finance expense

Depreciation and amortisation

121

(4,828)

(20,946)

–

–

–

–

53

(1)

(8)

12

–

124

–

–

174

(4,705)

(20,954)

9,681

Acquisition of property, plant and equipment 

9,669

(i) 

 Intersegment revenue is recorded at amounts equal to competitive market prices charges to external customers for similar goods and 
services and is eliminated on consolidation.

64 Northern Iron Annual Report 2014

 
 
 
 
Note 26. Parent Entity Disclosures

Financial position 

As at 31 December 2014

Assets

Current assets

Non-current assets

Total assets

Liabilities 

Current liabilities

Non-current liabilities

Total liabilities

Equity

Issued capital

Accumulated losses 

Reserves

Share-based payments reserve

Foreign currency translation reserve

Total equity 

Financial performance

Loss for the year

Other comprehensive income

Total comprehensive income 

2014 
US$000

2013 
US$000

2,155

7,800

193,089

515,136

195,244

522,936

(324)

(30)

(354)

(331)

(25)

(356)

(541,135)

(541,135)

340,074

26,666

(4,117)

(4,047)

10,288

(4,064)

(194,890)

(522,580)

313,408

(35,751)

–

–

313,408

(35,751)

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

As result of the impairment of the mine properties and carrying value of assets, a provision for impairment has 
been made against the loan to and investment in subsidiaries.

Guarantees entered into by the parent in relation to debts of its subsidiaries
Northern Iron Limited has signed a letter of ﬁnancial support with Sydvaranger Gruve AS. 

Northern Iron Limited has provided a guarantee for the Innovasjon Norge ﬁnancing facility (Note 18 (b)) and 
equipment lease ﬁnance facility (Note 18 (d)). 

65

 
 
 
 
Notes to the Financial Statements

For the year ended 31 December 2014

Note 27. Key Management Personnel Disclosures

Key management personnel compensation
Key management personnel compensation is as follows:

Short term benefits

Post-employment benefits

Share based payments

2014 
US$

2013 
US$

2,725,457

3,400,429

102,365

146,857

69,936

–

2,897,758

3,547,286

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

Information regarding individual directors and executive officers compensation is provided in the Remuneration 
Report as set out on pages 19 to 26. 

Note 28. Financial Instruments

(a) Capital risk management
The Group manages its capital to ensure that entities in the Group will be able to continue as a going concern 
while maximising the return to stakeholders through the optimisation of the debt and equity balance.

The Group’s overall strategy remains unchanged from 2013.

The capital structure of the Group consists of debt, cash and cash equivalents and equity attributable to equity 
holders of the parent, comprising issued capital, reserves and retained earnings.

Operating cash ﬂows are used to maintain and expand operations, as well as to make routine expenditures such 
as tax, dividends, and general administrative outgoings.

Gearing levels are reviewed by the Board on a regular basis in line with its target gearing ratio, the cost of capital 
and the risks associated with each class of capital.

(b) Financial risk management objectives
The Group’s activities expose it to market risk (including foreign currency risk, commodity price risk and interest 
rate risk), credit risk, and liquidity risk. 

This note presents qualitative and quantitative information about the Group’s exposure to each of the above 
risks, their objectives, policies, and procedures for managing risk, and the management of capital. The Board of 
Directors has overall responsibility for the establishment and oversight of the risk management framework.

The Group’s overall risk management approach focuses on the unpredictability of ﬁnancial markets and seeks 
to minimise the potential adverse effects on the ﬁnancial performance of the Group. The Group currently has 
a natural hedge from sales receipts in relation to certain foreign currency borrowings however it is generally 
exposed elsewhere to daily movements in exchange rates and interest rates.

The Group uses various methods to measure different types of risk to which it is exposed. These methods include 
sensitivity analysis in the case of interest rate, foreign exchange, and commodity price risk and ageing analysis 
for credit risk.

The Board’s policy is to maintain a strong capital base so as to maintain investor, creditor, and market conﬁdence 
and to sustain future development of the business. Given the stage of the Group’s development there are no 
formal targets set for return on capital. There were no changes to the Group’s approach to capital management 
during the year. 

During 2008, Sydvaranger Gruve AS entered into an equipment ﬁnance lease facility with DNB (refer Note 18). 
Under the terms of the facility, the subsidiary is required to maintain a minimum equity ratio of 50%, being equity 
divided by total assets. Equity, for this purpose includes the loan payable to the parent entity. Total assets, for 
this purpose, exclude unrestricted cash and the concentrate, storage, handling and ship-loading facility leased 
assets. The subsidiary was in compliance with this requirement throughout the reporting period. Covenants 
under other ﬁnancing arrangements relate to ﬁnancial results, for which the Group was in compliance except 
for the EBITDA covenant. The EBITDA covenant stipulates that the Company shall have an EBITDA greater than 
US$27.5 million on a yearly basis. However, the Company obtained a waiver from this covenant for a period of 
twelve months, until the 30 September 2013. A further waiver on the EBITDA covenant was granted by DNB and 

66 Northern Iron Annual Report 2014

 
 
 
 
Innovasjon Norge for the quarter ending June 2014 and extended in September 2014 until 30 September 2015. 
After this date the EBITDA debt covenant is to be re-established in increments of US$7 million per quarter from 
quarter four 2015. 

(c) Market risk

(i) Foreign currency risk management
Currency risk currently arises from purchases, assets and liabilities that are denominated in a currency other than 
the functional currencies of the entities within the Group, and from purchases in currencies other than those in 
which cash balances are held.

The Group operates predominantly in Norway and is exposed to currency risk arising from various foreign 
currency exposures, primarily with respect to the US$ and Norwegian Kroner (“NOK”). The functional currency 
of its Norwegian operations is US$. 

It is the Group’s policy that management may hedge foreign currency exposure on capital purchases as they 
become known by purchasing the currency in which the exposure arises. The majority of the Group’s capital 
expenditure is denominated in US$, A$, NOK, SEK and Euro. 

The sale of iron ore is denominated in US$. The Group’s management of currency risk will be monitored during 
the stabilising of operations as the denomination of expenditures becomes increasingly more consistent and 
known.

The Group’s exposure to foreign currency risk at balance date was as follows, based on carrying amounts.

NOK 
US$000

SEK 
US$000

US$ 
US$000

Euro 
US$000

CHF 
US$000

GBP 
US$000

DKK 
US$000

A$ 
US$000

Totals 
US$000

2014

Cash and cash 
equivalents

Trade and other 
receivables

Trade and other 
payables

5,546

2,822

–

–

587

19,326

22

–

(23,799)

(730)

326

(1,695)

Tax liability

–

Borrowings

(19,283)

–

–

–

(47,058)

–

–

56

–

(16)

(129)

–

–

–

–

–

407

6,618

12

22,160

(19)

(33)

1,038

(24,928)

–

–

–

–

–

–

(129)

(66,341)

Gross exposure

(34,714)

(730)

(26,819)

(1,673)

(89)

(19)

(33)

1,458

(62,619)

2013

Cash and cash 
equivalents

Trade and other 
receivables

Trade and other 
payables

11,023

7,775

–

1

7,853

27,174

41

–

24

–

–

55

–

–

505

19,446

18

35,023

(28,353)

(1,226)

(418)

(1,303)

(18)

(34)

(45)

(40)

(31,437)

Tax liability

–

Borrowings

(26,748)

–

–

–

(60,470)

–

–

(340)

–

Gross exposure

(36,303)

(1,225)

(25,861)

(1,262)

(334)

–

–

21

–

–

–

–

(340)

(87,218)

(45)

483

(64,526)

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

67

 
 
 
 
Notes to the Financial Statements

For the year ended 31 December 2014

Note 28. Financial Instruments (continued)
The following signiﬁcant exchange rates applied during the year:

US$ to:

1 Norwegian Kroner

1 AUD

1 Euro

1 Swedish Kroner

Average rate

Reporting date spot rate

2014

0.159

0.901

1.326

0.146

2013

0.170

0.966

1.329

0.154

2014

0.135

0.819

1.216

0.129

2013

0.164

0.892

1.378

0.156

Sensitivity analysis
A 5% strengthening of the following currencies at 31 December would have changed equity and post-tax proﬁt 
and loss by the amounts shown below. This analysis assumes that all other variables, in particular interest rates 
and the exchange rate between other currencies, remain constant. The analysis is performed on the same basis 
for 2013:

31 December 2014

US$ to NOK

A$ to US$

31 December 2013

US$ to NOK

A$ to US$

Equity 
US$000

Profit and 
loss  
US$000

(1,417)

90

(104)

372

(1,417)

(84)

(104)

(21)

A 5% weakening of the following currencies at 31 December would have changed equity and post-tax proﬁt and 
loss by the amounts shown below. This analysis assumes that all other variables, in particular interest rates and the 
exchange rate between other currencies, remain constant. The analysis is performed on the same basis for 2013:

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

31 December 2014

US$ to NOK

A$ to US$

31 December 2013

US$ to NOK

A$ to US$

Equity 
US$000

Profit and 
loss 
US$000

4,293

(90)

4,293

84

(626)

(373)

(626)

21

Forward foreign exchange contracts
Forward foreign exchange contracts are valued at fair value through proﬁt and loss. At 31 December 2014, the 
Company had 10 forward exchange contracts in place (2013: 18), the details of which were:

Period

2015

2016

68 Northern Iron Annual Report 2014

Contract 
Amount 
US$000

168,000

96,000

Average 
contract 
rate 
US$/NOK

Reporting 
date spot 
rate 
US$/NOK

Change in 
fair value 
US$000

6.30

6.41

7.43

7.43

(26,289)

(13,505)

(39,794)

 
 
 
 
(ii) Interest rate risk management
The signiﬁcance and management of this risk on investments to the Group is dependent on a number of factors 
including:
 – interest rates (current and forward) and the currencies that are held;
 – level of cash and liquid investments and their term;
 – maturity dates of investments; and
 – proportion of investments that are ﬁxed rate or ﬂoating rate.

The risk is managed by the Group by maintaining an appropriate mix between ﬁxed and ﬂoating rate 
investments. 

The Group is exposed to interest rate risk under its various borrowings outlined in Note 18 and continues to 
monitor opportunities to mitigate this interest rate risk.

At the reporting date, the effective interest rates of variable rate interest bearing assets and liabilities of the 
Group were as follows. 

Carrying amount

Financial assets

Financial liabilities

Weighted average interest rate (%)

Financial assets

Financial liabilities

2014 
US$000

2013 
US$000

8,341

20,889

66,340

87,218

0.75%

4.23%

0.87%

4.26%

Sensitivity analysis
An increase in 50 basis points from the weighted average year-end interest rates at 31 December would have 
increased/(decreased) equity and post-tax proﬁt and loss by the amounts shown below. This analysis assumes 
that all other variables remain constant. The analysis is performed on the same basis for 2013:

31 December 2014

31 December 2013

Equity 
US$000

Profit or 
loss 
US$000

60

(124)

(60)

(124)

A decrease in 50 basis points from the weighted average year-end interest rates at 31 December would have 
increased/(decreased) equity and post-tax proﬁt and loss by the amounts shown below. This analysis assumes 
that all other variables remain constant. The analysis is performed on the same basis for 2013:

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

31 December 2014

31 December 2013

Equity 
US$000

Profit or 
loss 
US$000

60

124

60

124

69

 
 
 
 
Notes to the Financial Statements

For the year ended 31 December 2014

Note 28. Financial Instruments (continued)

(iii) Commodity price risk management
Commodity price risk is the risk of ﬁnancial loss resulting from movements in the price of the Group’s commodity 
output, being iron ore, which is denominated in US$ and not widely traded in derivative markets. The Group 
recorded sales of iron ore concentrate for the year of US$182,042,000. In 2013, there were sales of approximately 
US$204,554,000.

The Group’s marketing strategy is to focus on long-term sales agreements with pellet producers in Europe and 
the Middle East for the majority of its production with the balance being sold into the spot market.

The Company has entered into a ﬁve year offtake agreement for up to approximately 50% of its nameplate 
production with TATA Steel Europe, primarily for use in their European steel operations. The product is primarily 
used at the Ijmuiden Pellet Plant. The contract runs until the end of March 2018 after TATA exercised their right to 
extend the contract by a further two years. The agreement provides TATA a minimum of 1.0 Mtpa per year from 
2012-2015 and 1.5 Mtpa from 2015 to 2018. TATA agreed to increase its offtake volume during the contract year 
ending 31 March 2013 by 275,000 wet tonnes and by six shipments (approximately 420,000 wet tonnes) during 
the period 1 July 2014 to 31 March 2015. The pricing mechanism is in line with Vale’s mechanism for iron ore ﬁnes 
(which is the prevailing market mechanism in the Atlantic basin) and the FOB price reﬂects the proximity of 
the Company to Tata Steel in Europe and the quality in terms of silica content. In quarter four 2011, TATA Steel 
requested that the pricing mechanism be moved to current quarter pricing in line with changes implemented by 
other iron ore producers. The Company agreed to this request.

The Company has entered into an exclusive agency agreement with OMH Ltd subsidiary OMS Pte Ltd, for sales 
into the Asian region (inclusive of India, but excluding the Middle East and CIS countries). No offtake quantities 
are guaranteed under this agreement, and so far all sales to Asia (100% to China) have been on a spot basis with 
no sales taking place in 2014. The Agency agreement with OMS may be terminated if OMH Ltd’s ownership of 
NFE falls below 10%.

During the second half of 2013 the Company successfully diversiﬁed its sales amongst a variety of customers. 
New customers included ThyssenKrupp Steel and ArcelorMittal, while previous customer Bahrain Steel resumed 
purchases of concentrate. An important development has been the trialling of Sydvaranger concentrate at a 
number of sinter plants throughout Europe. The Company will monitor the results and feedback from these trial 
cargoes and will seek to further its discussions with the various offtake parties, focusing on the potential for a 
longer term offtake agreement. Sales to Europe are expected to result in optimal FOB pricing due to the lower 
freight costs associated with shipping from Norway to Europe compared to more distant markets.

Sensitivity analysis
An increase in 50 basis points from the change in fair value would have (decreased)/increased equity and post-
tax proﬁt and loss by the amounts shown below. This analysis assumes that all other variables remain constant. 
The analysis is performed on the same basis for 2013:

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

31 December 2014

31 December 2013

Equity 
US$000

Profit and 
loss 
US$000

(1,421)

(229)

1,421

229

A decrease in 50 basis points from the change in fair value would have increased/(decreased) equity and post-
tax proﬁt and loss by the amounts shown below. This analysis assumes that all other variables remain constant. 
The analysis is performed on the same basis for 2013:

31 December 2014

31 December 2013

70 Northern Iron Annual Report 2014

Equity 
US$000

Profit and 
loss 
US$000

1,421

229

(1,421)

(229)

 
 
 
 
Forward iron ore price contracts
Forward iron ore price contracts are valued at fair value through proﬁt or loss. As at 31 December 2014, the 
Company had nil (2013: 25) forward iron ore price contracts in place with the purpose of minimising the 
ﬂuctuations in iron ore price, the details of which were:

2014
Nil

2013

No. of Contracts

Period

Expiry

Tonnes

Average 
Contract Rate 
US$

Change in  
Fair Value 
US$000

7

11

5

2

Quarter 4 2013

8 January 2014

Quarter 1 2014

7 April 2014

Quarter 2 2014

7 July 2014

Quarter 3 2014

7 October 2014

210,000

210,000

135,000

60,000

121

120

123

120

(3,008)

(2,375)

(274)

(60)

(5,717)

Electricity price risk contracts
The Group is exposed to electricity price risk. As at 31 December 2014, the Group had 16 (2013: 14) electricity 
price contracts in place with the purpose of minimising the ﬂuctuations in electricity price, the details of which 
are:

2014

No. of Contracts

Period

Expiry

Quantity 
(MWh)

Average 
Contract Rate 
(EUR/NO4)

Change in Fair 
Value 
US$000

7

6

2

1

2013

2015 year

31 December 2015

2016 year

31 December 2016

2017 year

31 December 2017

2018 year

31 December 2018

78,843

61,489

17,569

8,784

35.63

34.34

30.62

30.37

(498)

(302)

(13)

(5)

(818)

No. of Contracts

Period

Expiry

5

5

4

2014 year

31 December 2014

2015 year

31 December 2015

2016 year

31 December 2016

Quantity  
(MWh)

87,600

61,320

43,920

Average 
Contract Rate  
(EUR/NO4)

Change in Fair 
Value  
US$000

38.47

36.53

35.40

(732)

(378)

(236)

(1,346)

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

71

 
 
 
 
Notes to the Financial Statements

For the year ended 31 December 2014

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

Note 28. Financial Instruments (continued)

(d) Credit risk management
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in a ﬁnancial 
loss to the Group. The Group has not had any instances of uncollectable trade receivables during the current or 
prior reporting periods and credit risk arising from security deposits and receivables from taxation authorities is 
considered to be low.

Credit risk is reduced through diversiﬁcation and through accepting counterparties with good credit rating. 
Exposure to credit risk is considered minimal though continues to be monitored on an ongoing basis. The 
maximum exposure to credit risk is represented by the carrying amount of each ﬁnancial asset in the Statement 
of Financial Position. The Group’s maximum exposure to credit risk at the reporting date was:

Carrying amount:

Cash and cash equivalents

Trade and other receivables

2014 
US$000

2013 
US$000

6,618

22,369

28,987

19,446

35,023

54,469

(e) Liquidity risk management
Liquidity risk is the risk that the Group will not be able to meet its ﬁnancial obligations as and when they fall 
due. The Group’s approach to managing this risk is to ensure, as far as possible, that it will always have sufficient 
liquidity to meet its liabilities when due under a range of ﬁnancial conditions. 

The Group’s borrowing facilities are set out in Note 18. The following are the contractual maturities of ﬁnancial 
liabilities. These have been drawn up based on undiscounted contractual maturities of ﬁnancial liabilities 
including interest that will be payable:

Carrying 
amount 
US$000

Contractual 
cash flows(i) 
US$000

6 months 
or less 
US$000

6 to 12 
months 
US$000

1 to 5 years 
US$000

Over 5 
years 
US$000

2014

Non-derivative financial liabilities

Trade and other payables

24,928

24,928

24,928

Current tax liability

129

129

129

–

–

–

–

–

–

Interest bearing loans and 
borrowings

2013

Non-derivative financial liabilities

66,341

91,398

70,712

95,769

6,394

31,451

8,450

8,450

31,868

31,868

24,000

24,000

Carrying 
amount 
US$000

Contractual 
cash flows(i) 
US$000

6 months or 
less  
US$000

6 to 12 
months 
US$000

1 to 5 years 
US$000

Over 5 
years 
US$000

Trade and other payables

31,437

31,437

31,437

Current tax liability

340

340

340

–

–

–

–

–

–

Interest bearing loans and 
borrowings

87,218

92,878

118,995

124,655

9,551

41,328

15,094

15,094

40,196

40,196

28,037

28,037

(i) 

 Repayments towards the DNB Working Capital Facility are included in the contractual cash ﬂows, however the facility has no speciﬁed 
requirements as to making regular ﬁxed repayments. The expected year end closing balance is shown in the Over 5 years column.

72 Northern Iron Annual Report 2014

 
 
 
 
(f) Fair value of ﬁnancial instruments
This note provides information about how the Group determines fair values of various ﬁnancial assets and 
liabilities.

Fair value of the Group’s ﬁnancial assets and ﬁnancial liabilities that are measured at fair value on a recurring 
basis

Some of the group’s ﬁnancial assets and liabilities are measured at fair value at the end of each reporting 
period. The following table gives information about how the fair values of these ﬁnancial assets and liabilities are 
determined.

Fair value at

2014 
US$000

2013 
US$000

Fair value 
hierarchy

Valuation 
technique(s)  
and key input(s)

Significant 
unobservable 
input(s)

Relationship of 
unobservable 
inputs to fair 
value

Foreign currency 
forward contracts

Forward iron ore 
price contracts

Assets –  
nil; and  
Liabilities  
– 39,794

Liabilities  
– nil

Assets –  
534; and 
Liabilities  
– nil

Liabilities  
– 5,717

Electricity price risk 
contracts

Liabilities  
– 818

Liabilities  
– 1,346

Level 2

Level 2

Marked-to-market 
based on published 
closing spot rate

N/A

N/A

Level 2

Marked-to-market 
based on published 
CFR 62% Fe prices

Marked-to-market  
based on published  
NO4 region 
closing prices

N/A

N/A

N/A

N/A

There were no transfers between Level 1 and Level 2 during the year

Fair value of the Group’s ﬁnancial assets and ﬁnancial liabilities that are not measured at fair value on a recurring 
basis (but fair value disclosures are required)

The directors consider that the carrying amounts of ﬁnancial assets and ﬁnancial liabilities recognised in the 
consolidated ﬁnancial statements approximate their fair values.

Note 29. Deﬁned Contribution Plan
SVG is obliged to have a deﬁned contribution plan for its employees and has fulﬁlled its obligations under the 
Norwegian mandatory occupational pension law.

SVG has a deﬁned contribution plan, where SVG each year pays a ﬁxed contribution into a separate entity/fund, 
and has no further obligations to pay contributions. The employees have the risk and beneﬁt of return on the 
investments. The contribution by SVG during the reporting period is US$996,297 (2013: US$1,011,325). 

SVG also has a mandatory agreement for early retirement with The Norwegian Confederation of Trade Unions 
and The Confederation of Norwegian Business and Industry. The contribution by SVG during the reporting 
period is US$632,871 (2013: US$660,529).

Note 30. Contingencies
The Company is in discussions with insurer AIG over the quantum payable under the conﬁrmed coverage 
of business interruption due to the collision of two haul trucks in January 2014. AIG have valued the loss 
at US$1,906,000 and the Company values the loss at approximately US$8,000,000. The policy has a 
US$1,000,000 deductible amount. 

Apart from the above, in the opinion of the directors, there are no contingent liabilities as at 31 December 
2014 and no contingent liabilities were incurred in the interval between balance date and the date of this 
ﬁnancial report.

73

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

 
 
 
 
Notes to the Financial Statements

For the year ended 31 December 2014

Note 31. Subsequent Events
In January 2015, DNB made available a new working capital facility for the Company in the amount of 
US$10.0 million, subsequently increased to US$11.2 million during March 2015, of which the majority of the 
funding was reserved to cover foreign exchange hedging losses realised in the March 2015 quarter due to 
the weakness in the US$:NOK rate. This facility is available for the period 01.01.2015 to 31.03.2015.

In January 2015, the company reached agreements with DNB, Innovasjon Norge and Tschudi Bulk Terminals 
for the deferral of interest payments associated with its debt facilities and lease payments for the period from 
1 January 2015 to 31 March 2015. Subsequent agreements were reached in March 2015 where the deferral of 
payments has been extended up until 30 June 2015. Financial covenants associated with loan agreements were 
waived for the same period.

In March 2015, the Company reached an agreement with its main offtake partner according to which, sales will be 
similar to spot pricing arrangements and improved payment terms will be applied for the period 1 April 2015 until 
30 June 2015.

In March 2015, the Company reached an agreement with DNB on restructuring its debt facilities until 30 June 
2015 which included an adjustment to the borrowing base mechanism of the working capital facility, to enable 
the Company to effectively manage its liquidity position. 

In March 2015, DNB closed out the exposure on foreign exchange hedge contracts remaining in the 2015 year 
and provided funding to the Company of this position with the result that the close out of these hedging 
contracts will have no liquidity effect for the Company for the next 12 months.

Other than this, no matter or circumstance has arisen since 31 December 2014 that in the opinion of the directors 
has signiﬁcantly affected, or may signiﬁcantly affect in future ﬁnancial years:

(i)  the Group’s operations;  

(ii) the results of those operations; or

(iii) the Group’s state of affairs.

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74 Northern Iron Annual Report 2014

 
 
 
 
 
Directors’ Declaration

1. 

In the opinion of the directors of Northern Iron Limited (the Company): 

(a)   the accompanying ﬁnancial statements and notes set out on pages 30 to 74 are in accordance with the 

Corporations Act 2001, including:

(i)   giving a true and fair view of the Group’s ﬁnancial position as at 31 December 2014 and of its 

performance for the ﬁnancial year ended on that date; and

(ii)    complying with Australian Accounting Standards (including the Australian Accounting 

Interpretations) and the Corporations Regulations 2001; and

(b)   there are reasonable grounds to believe that the Company will be able to pay its debts as and when they 

become due and payable.

2.   This declaration has been made after receiving the declarations required to be made to the directors in 

accordance with section 295A of the Corporations Act 2001 for the ﬁnancial year ended 31 December 2014.

Signed in accordance with a resolution of the Board of directors.

Antony Beckmand 
Managing Director and Chief Executive Officer 

Peter Bilbe 
Chairman

Kirkenes, 31 March 2015 

Perth, 31 March 2015

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75

 
 
 
 
 
 
 
 
 
 
Independent Auditor’s Report

To the members of Northern Iron Limited

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INDEPENDENT AUDITOR’S REPORT
To the members of Northern Iron Limited

Report on the Financial Report

We have audited the accompanying financial report of Northern Iron Limited (“the company”), which comprises the 
consolidated statement of financial position as at 31 December 2014, the consolidated statement of comprehensive 
income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year 
then ended, notes comprising a summary of significant accounting policies and other explanatory information, and 
the  directors’  declaration  for  the  consolidated  entity.  The  consolidated  entity  comprises  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 
control  as  the  directors  determine  is  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 report complies 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 
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 judgement, 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  control  relevant  to  the  company’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 internal control. 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. 

Our audit did not involve an analysis of the prudence of business decisions made by directors or management.

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.

HLB Mann Judd (WA Partnership)  ABN 22 193 232 714
Level 4, 130 Stirling Street Perth WA 6000.  PO Box 8124 Perth BC 6849 Telephone +61 (08) 9227 7500. Fax +61 (08) 9227 7533.
Email: hlb@hlbwa.com.au.  Website: http://www.hlb.com.au
Liability limited by a scheme approved under Professional Standards Legislation

HLB Mann Judd (WA Partnership) is a member of 

International, a worldwide organisation of accounting firms and business advisers.

76 Northern Iron Annual Report 2014

 
 
 
 
 
 
 
Auditor’s opinion 

In our opinion: 

(a)

the financial report of Northern Iron Limited is in accordance with the Corporations Act 2001, including: 

(i)

giving a true and fair view of the consolidated entity’s financial position as at 31 December 2014 and 
of its performance for the year ended on that date; and 

(ii)

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 2.

Emphasis of matter

Without  qualifying  our  opinion,  we  draw  attention  to  Note  2  to  the  financial  statements,  which  indicates  that  the 
Group will require additional funding, and the successful completion of the initiatives listed in Note 2 to enable the 
Group  to  continue  to  fund  its  operations.  If  the  Group  is  unable  to  successfully  secure  additional  funding  and 
complete these initiatives, there is a material uncertainty that may cast doubt on the Group’s ability to continue as a 
going concern, and therefore it may be unable to realise its assets and discharge its liabilities in the normal course 
of business and at the amounts stated in the financial statements.

Report on the Remuneration Report

We have audited the remuneration report included in the directors’ report for the  year ended 31 December 2014.
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. 

Auditor’s opinion 

In  our  opinion  the  remuneration  report  of  Northern  Iron  Limited for  the  year ended  31  December  2014  complies 
with section 300A of the Corporations Act 2001.

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HLB Mann Judd
Chartered Accountants

Perth, Western Australia
31 March 2015

N G Neill
Partner

77

 
 
 
 
Corporate Governance Statement

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Introduction
Northern Iron has in place corporate governance practices that are formally embodied in corporate governance 
policies and codes adopted by the Board (the Policies). The aim of the Policies is to ensure that the Company 
is effectively directed and managed, that risks are identiﬁed, monitored, and assessed and that appropriate 
disclosures are made. 

In preparing the Policies, the directors considered the ASX Corporate Governance Council’s “Corporate 
Governance Principles and Recommendations” (ASX Principles). The Board has adopted these ASX Principles, 
subject to the departures noted below.

The directors incorporated the ASX Principles into the Policies to the extent that they were appropriate, taking 
into account the Company’s size, the structure of the Board, its resources, and its proposed activities. The Board 
has adopted the following policies and procedures.

Statement and Charters
 – Corporate Governance Statement
 – Board Charter
 – Audit Committee Charter
 – Remuneration, Nomination and Governance Committee Charter

Policies and Procedures
 – Code of Conduct
 – Trading in Company Securities
 – Risk Management Policy (within the Board and Audit Committee Charters)
 – Shareholder Communication Strategy
 – Continuous Disclosure Policy
 – Board Diversity Policy

As the Company and its activities grow, the Board may implement additional corporate governance structures 
and committees. The Company’s corporate governance Policies are available on the Company’s website at  
www.northerniron.com.au.

Number of Audit Committee meetings, names, and qualiﬁcation of members
The number of Audit Committee meetings and the names of attendees are set out in the directors’ report 
together with their qualiﬁcations.

Number of Remuneration, Nomination and Governance Committee meetings, names, and qualiﬁcation 
of members
The number of Remuneration, Nomination and Governance Committee meetings and the names of attendees is 
set out in the directors’ report together with their qualiﬁcations.

Remuneration, Nomination and Governance Committee matters may also, at the discretion of the Board, be dealt 
with at meetings of the full Board. Where this is the case voting is reserved for those members of the Board who 
are on the relevant committees.

Performance evaluation of the board, its committees, and senior executives
The Board reviews and evaluates the performance of the Board and its committees, which involves consideration 
of all the Board’s key areas of responsibility.

A performance evaluation of senior executives was undertaken during the year. Evaluation of executives 
reporting to the Managing Director was undertaken by the Managing Director and subsequently approved by 
the Remuneration Committee and by the full Board. Evaluation of the performance of the Managing Director was 
undertaken by the Remuneration, Nomination and Governance Committee, reporting to the Chairman.

Skills, experience, expertise, and term of office of each director
A proﬁle of each director containing the applicable information is set out in the directors’ report. 

78 Northern Iron Annual Report 2014

 
 
 
 
Explanations for departures from best practice recommendations
From 1 January 2014 to 31 December 2014 (the Reporting Period”), the Company complied in all material 
respects with each of the Corporate Governance Principles and the corresponding Recommendations as 
published by the ASX Corporate Governance Council (“ASX Principles and Recommendations”) except as 
noted below:

Principle

Recommendation Description

Explanation for departure

2

2.1

A majority of 
the Board was 
not comprised 
of independent 
directors for the 
whole of the 
Reporting Period.

During the period from 1 January 2014 until 
1 April 2014 the Board comprised four (4) 
directors, of whom two (2) were considered by 
the Board to be independent. On 1 April 2014, 
Mr Peter Campbell Church OAM was appointed 
as a non-executive director in accordance with 
the share subscription agreement dated 19 
January 2010 between the Company and OM 
Holdings Ltd (OMH), which permits OMH to 
appoint a nominee to the Company’s Board 
subject to maintaining a shareholding in excess 
of 10%. During the period from 1 April 2014 until 
31 December 2014, the Board has comprised five 
(5) directors, of whom two (2) are considered by 
the Board to be independent.

The Board (and Remuneration, Nomination and 
Governance Committee) continues to monitor 
its composition and the needs of the Company. 
Additional independent non-executive directors 
may be appointed in future.

Statement concerning availability of independent professional advice
If a director considers it necessary to obtain independent professional advice to properly discharge the 
responsibility of his office as a director then, provided the director ﬁrst obtains approval for incurring such 
expense from the Chairman, the Company will pay reasonable expenses associated with obtaining such advice.

Existence and terms of any schemes for retirement beneﬁts for non-executive directors
The Company does not have any terms or schemes relating to retirement beneﬁts for non-executive directors.

Company’s remuneration policies
The Company’s remuneration policies are set out in the Remuneration Report on pages 19 to 26 and in the 
Company’s Remuneration, Nomination & Governance Committee Charter, as available on its website. The 
Company has separate remuneration policies for executive and non-executive directors.

Non-executive directors receive a ﬁxed fee and, when appropriate may also be eligible to receive share 
options. Executive directors receive a salary or fee and, when appropriate, performance based remuneration 
and share options.

Identiﬁcation of independent directors
The Company’s independent directors are considered to be Mr Peter Bilbe and Mr Ashwath Mehra.

None of these directors was considered to have a material relationship with the Company or another group 
member (other than their directorships) during the Reporting Period as professional advisor, consultant, supplier, 
customer, or through any other contractual relationship, nor did they have any business or other relationship 
which could, or could reasonably be perceived to, materially interfere with the director’s ability to act in the best 
interests of the Company. 

The Board considers “material” in this context to be where any director related business relationship represents 
the lesser of at least 5% of the Company’s or the director-related business’s revenue.

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79

 
 
 
 
Corporate Governance Statement

Continued

Material business risks
Risk Management is a standing agenda item for consideration at Board meetings. Management of the Company 
is responsible for the preparation and maintenance of a register of material business risks and responses and 
is required also to report to the Board as to the effectiveness of the Company’s management of its material 
business risks.

Commitment to Diversity
The Company is committed to workplace diversity and to ensuring a diverse mix of skills and talent exists 
amongst its directors, officers and employees, to enhance Company performance. The Board has adopted a 
Diversity Policy which addresses equal opportunities in the hiring, training and career advancement of directors, 
officers and employees. The Policy outlines the strategies and process according to which the Board, Nomination 
and Remuneration Committees will set measurable objectives to achieve the aims of its Diversity Policy, with 
particular focus on gender diversity within the Company and supporting the representation of women at 
senior levels. The Board is responsible for monitoring Company performance in meeting the Diversity Policy 
requirements, including the achievement of diversity objectives. 

The Board and Remuneration Committee have now established appropriate measurable objectives and intend to 
report progress against them in the Company’s 2014 Annual Report.

Information relating to the current representation of women employees in the Northern Iron Group, holding 
senior executive positions and on the Board is as follows:

Number of Women Employees

Northern Iron Limited Group

Senior Executives

Board representation (Group companies)

Board representation (Parent Company)

56

1

1

–

%

13.3

20

10

–

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80 Northern Iron Annual Report 2014

 
 
 
 
ASX Recommendation

Compliance (Yes/No)

Explanation

PRINCIPLE 1: LAY SOLID FOUNDATIONS FOR MANAGEMENT AND OVERSIGHT

ASX Recommendation 1.1: Companies 
should establish the functions reserved 
to the board and those delegated to 
senior executives and disclose those 
functions.

ASX Recommendation 1.2: Companies 
should disclose the process for 
evaluating the performance of senior 
executives.

ASX Recommendation 1.3: Companies 
should provide the information 
indicated in the Guide to reporting on 
Principle 1.

Yes

Yes

Yes

PRINCIPLE 2: STRUCTURE THE BOARD TO ADD VALUE

ASX Recommendation 2.1: A majority 
of the board should be independent 
directors.

No

ASX Recommendation 2.2: The chair 
should be an independent director.

ASX Recommendation 2.3: The roles of 
chair and chief executive officer should 
not be exercised by the same individual.

Yes

Yes

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The Board has adopted a formal charter 
that details the respective board and 
management functions and responsibilities. 
A copy of the board charter is available in 
the governance section of the Company’s 
website at www.northerniron.com.au. 

The Board has adopted a performance 
evaluation policy, which provides that the 
Remuneration, Nomination Committee 
and Governance Committee will carry out 
performance evaluation of senior executives 
of the Company and that an independent 
adviser may be used.

This evaluation will be based on specific 
criteria, including the business performance 
of the Company and its subsidiaries, whether 
strategic objectives are being achieved 
and the development of management 
and personnel. Each senior executive’s 
performance will be assessed against his or 
her designated roles and responsibilities.

The Company has provided the information 
indicated in the Guide to reporting on 
Principle 1 in its annual report and on the 
Company’s website.

During the period from 1 January 2014 until 
1 April 2014 the Board comprised four (4) 
directors, of whom two (2) were considered 
by the Board to be independent. On 1 April 
2014, Mr Peter Campbell Church OAM was 
appointed as a non-executive director in 
accordance with the share subscription 
agreement dated 19 January 2010 between 
the Company and OM Holdings Ltd (OMH), 
which permits OMH to appoint a nominee to 
the Company’s Board subject to maintaining 
a shareholding in excess of 10%. During the 
period from 1 April 2014 until 31 December 
2014, the Board has comprised five (5) 
directors, of whom two (2) are considered by 
the Board to be independent.

The Board (and Remuneration, Nomination 
and Governance Committee) continues to 
monitor its composition and the needs of 
the Company. Additional independent non-
executive directors may be appointed in 
future.

The Chairman of the Company, Mr Peter 
Bilbe, is considered to be an independent 
director by the Board.

The role of chair of the Board is exercised by 
Mr Peter Bilbe. The role of Chief Executive 
Officer is exercised by Mr Antony Beckmand.

81

 
 
 
 
Corporate Governance Statement

Continued

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ASX Recommendation

Compliance (Yes/No)

Explanation

ASX Recommendation 2.4: The 
board should establish a nomination 
committee.

ASX Recommendation 2.5: Companies 
should disclose the process for 
evaluating the performance of the 
board, its committees and individual 
directors.

ASX Recommendation 2.6: Companies 
should provide the information 
indicated in the Guide to reporting on 
Principle 2.

Yes

Yes

Yes

The Board has established a Remuneration, 
Nomination & Governance Committee 
and adopted a charter that sets out the 
committee’s role and responsibilities, 
composition and membership requirements.

A copy of the committee charter is available 
in the governance section of the Company’s 
website.

The Company’s board charter outlines the 
process for evaluating the performance of 
the Board, its committees and individual 
directors. The Board may decide to engage 
an independent adviser to undertake this 
review.

A performance evaluation took place during 
the year to 31 December 2013 and was 
carried out by the Chairman.

Copies of the board charter and the charter 
of the Remuneration, Nomination and 
Governance Committee are available in 
the governance section of the Company’s 
website.

The Company includes in its annual reports 
and on its website the information indicated 
in the Guide to reporting on Principle 2.

PRINCIPLE 3: PROMOTE ETHICAL AND RESPONSIBLE DECISION-MAKING

The Company has established a code of 
conduct and a copy of the code is available 
in the governance section of the Company’s 
website.

The Company has established a 
diversity policy which addresses ASX 
Recommendation 3.2. A copy of the policy 
is available in the governance section of the 
Company’s website.

Yes

Yes

ASX Recommendation 3.1: Companies 
should establish a code of conduct and 
disclose the code or a summary of the 
code as to:
 – the practices necessary to maintain 

conﬁdence in the company’s 
integrity;

 – the practices necessary to take into 
account their legal obligations and 
the reasonable expectations of their 
stakeholders; and

 – the responsibility and accountability 
of individuals for reporting and 
investigating reports of unethical 
practices.

ASX Recommendation 3.2: Companies 
should establish a policy concerning 
diversity and disclose the policy or 
a summary of that policy. The policy 
should include requirements for 
the board to establish measurable 
objectives for achieving gender 
diversity for the board to assess 
annually both the objectives and 
progress in achieving them.

82 Northern Iron Annual Report 2014

 
 
 
 
ASX Recommendation

Compliance (Yes/No)

Explanation

ASX Recommendation 3.3: Companies 
should disclose in each annual report 
the measurable objectives for achieving 
gender diversity set by the board in 
accordance with the diversity policy 
and progress towards achieving them.

Yes

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The Company has a Diversity Policy 
endorsed by the Board and is committed 
to providing a diverse and inclusive work 
environment in which everyone is treated 
fairly and with respect. 

Measurable objectives have been established 
for achieving gender diversity, which are to 
be reviewed annually. The Remuneration, 
Nomination and Governance Committee has 
the responsibility of assessing and reporting 
to the Board on progress towards achieving 
the measurable objectives on an annual 
basis. The Remuneration, Nomination and 
Governance Committee has the responsibility 
of recommending to the Board the extent 
to which the achievement of measurable 
diversity objectives may be linked to the key 
performance indicators for the Board, Chief 
Executive Officer and senior executives.

The measurable objectives relating to gender 
diversity, set by the Board are as follows:
 – Ensure recruitment policies and 

procedures reﬂect NFE’s policy on 
diversity.

Complete

 – Human Resources Manager to provide 
an initial status report, and then to 
report on a periodic basis including 
recommendations for future workplace 
participation rates.

Partially complete, initial status report 
and periodic reporting has been 
implemented, recommendations for 
future participation rates expected 
during 2015.

 – Implement diversity education and 

training for all employees and contractors, 
and conduct awareness sessions on issues 
relating to equal opportunities in the 
workplace.

In progress. Discussions were held 
among all employees based on 
employee survey results during 2014. 
Speciﬁc diversity education and 
training was not initiated during the 
year. Subject to budget allocation it is 
expected that this will be completed 
during 2015.

 – Issue guidance notes on the Company’s 
commitment to diversity to all external 
agencies engaged to provide recruitment 
services.

In progress. External agencies currently 
work in line with the Company’s 
diversity policies and commitments. 
Formalisation of guidance is expected 
to be implemented during 2015.

83

 
 
 
 
Corporate Governance Statement

Continued

ASX Recommendation

Compliance (Yes/No)

Explanation

ASX Recommendation 3.4: Companies 
should disclose in each annual report 
the proportion of women employees 
in the whole organisation, women in 
senior executive positions and women 
on the board.

ASX Recommendation 3.5: Companies 
should provide the information 
indicated in the Guide to reporting on 
Principle 3.

Yes

Yes

The Company has disclosed this information 
in the governance section of its annual 
report.

The Company discloses in the corporate 
governance statement in its annual reports 
an explanation of any departure from ASX 
Recommendations 3.1, 3.2, 3.3, 3.4 or 3.5 
(see above).

Copies of the Company’s diversity policy are 
available in the governance section of the 
Company’s website.

PRINCIPLE 4: SAFEGUARD INTEGRITY IN FINANCIAL REPORTING

ASX Recommendation 4.1: The Board 
should establish an audit committee.

Yes

ASX Recommendation 4.2: The audit 
committee should be structured so  
that it:
 – consists only of non-executive 

directors;

 – consists of a majority of independent 

directors;

 – is chaired by an independent chair, 
who is not chair of the board; and

 – has at least three members.

ASX Recommendation 4.3: The audit 
committee should have a formal 
charter.

Yes

Yes

The Board has established an Audit 
Committee and adopted a charter that 
sets out the Audit Committee’s purpose, 
composition, duties and responsibilities. 
The role of the Audit Committee is to assist 
the Board in monitoring and reviewing any 
matters of significance affecting financial 
reporting and compliance.

A copy of the charter of the Audit 
Committee is available in the governance 
section of the Company’s website.

The structure of the Company’s Audit 
Committee meets the requirements of 
Recommendation 4.2. The members of the 
committee are set out in the directors’ report 
together with their qualifications.

The Board has adopted a formal charter 
that details the Audit Committee’s purpose, 
composition, duties and responsibilities. A 
copy of the charter of the Audit Committee 
is available in the governance section of the 
Company’s website.

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84 Northern Iron Annual Report 2014

 
 
 
 
ASX Recommendation

Compliance (Yes/No)

Explanation

ASX Recommendation 4.4: Companies 
should provide the information 
indicated in the Guide to reporting on 
Principle 4.

Yes

PRINCIPLE 5: MAKE TIMELY AND BALANCED DISCLOSURE

Yes

ASX Recommendation 5.1: Companies 
should establish written policies 
designed to ensure compliance 
with ASX Listing Rule disclosure 
requirements and to ensure 
accountability at a senior executive 
level for that compliance and disclose 
those policies or a summary of those 
policies.

ASX Recommendation 5.2: Companies 
should provide the information 
indicated in the Guide to reporting on 
Principle 5.

Yes

The Company has disclosed in the Directors’ 
Report the names and qualifications of 
those appointed to its audit committee, their 
attendance at meetings and the number of 
meetings of the audit committee.

The Company has disclosed in this 
Corporate Governance section of its Annual 
Report an explanation of departures from 
Recommendations 4.1, 4.2, 4.3 and 4.4 
(none).

The Board has adopted a formal charter 
of the Audit Committee, which provides 
information on procedures for the selection 
and appointment of the external auditor, and 
for the rotation of external audit engagement 
partners. A copy of this charter is available 
in the governance section of the Company’s 
website.

The Company has established a continuous 
disclosure policy which is designed to guide 
compliance with ASX Listing Rule disclosure 
requirements and to ensure that all directors, 
senior executives and employees of the 
Company understand their responsibilities 
under the policy. The Board has designated 
the Managing Director and the Company 
Secretary as the persons responsible for 
ensuring that this policy is implemented 
and enforced and that all required price 
sensitive information is disclosed to the ASX 
as required.

In accordance with the Company’s 
continuous disclosure policy, all information 
provided to ASX for release to the market will 
be posted to the Company’s website once 
ASX has confirmed that an announcement 
has been released to the market.

A copy of the continuous disclosure policy 
is available in the governance section of the 
Company’s website.

The Company includes in its annual reports 
an explanation of any departure from ASX 
Recommendations 5.1 or 5.2 (none).

A copy of the Company’s continuous 
disclosure policy is available in the 
governance section of the Company’s 
website.

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

85

 
 
 
 
Corporate Governance Statement

Continued

ASX Recommendation

Compliance (Yes/No)

Explanation

PRINCIPLE 6: RESPECT THE RIGHTS OF SHAREHOLDERS

ASX Recommendation 6.1: Companies 
should design a communications policy 
for promoting effective communication 
with shareholders and encouraging 
their participation at general meetings 
and disclose their policy or a summary 
of that policy.

Yes

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

ASX Recommendation 6.2: Companies 
should provide the information 
indicated in the Guide to reporting on 
Principle 6.

Yes

The Company respects the rights of its 
shareholders and to facilitate the effective 
exercise of those rights the Company has 
designed a shareholder communication 
policy which outlines the Company’s 
commitment to:
 – communicating effectively with 

shareholders through releases to the 
market via ASX, information mailed to 
shareholders and the general meetings of 
the Company; 

 – giving shareholders ready access to 

balanced and understandable information 
about the Company and corporate 
proposals; 

 – encouraging shareholders to participate in 
general meetings of the Company; and 
 – requesting the external auditor 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. 

A copy of the shareholder communication 
policy is available in the governance section 
of the Company’s website.

The Company includes in its annual reports 
an explanation of any departure from ASX 
Recommendations 6.1 or 6.2 (none) and a 
description of how it will communicate with 
its shareholders publicly.

The Company has provided information 
about the Company generally for the benefit 
of its shareholders and market participants 
(among others) on the Company’s website 
and all information provided to ASX for 
release to the market is posted to its 
website once ASX has confirmed that an 
announcement has been released.

86 Northern Iron Annual Report 2014

 
 
 
 
ASX Recommendation

Compliance (Yes/No)

Explanation

PRINCIPLE 7: RECOGNISE AND MANAGE RISK

ASX Recommendation 7.1: Companies 
should establish policies for the 
oversight and management of material 
business risks and disclose a summary 
of those policies.

ASX Recommendation 7.2: The board 
should require management to design 
and implement the risk management 
and internal control system to manage 
the company’s material business risks 
and report to it on whether those 
risks are being managed effectively. 
The board should disclose that 
management has reported to it as to 
the effectiveness of the company’s 
management of its material business 
risks.

ASX Recommendation 7.3: The Board 
should disclose whether it has received 
assurance from the chief executive 
officer (or equivalent) and the chief 
financial officer (or equivalent) that the 
declaration provided in accordance 
with section 295A of the Corporations 
Act is founded on a sound system of 
risk management and internal control 
and that the system is operating 
effectively in all material respects in 
relation to financial reporting risks.

ASX Recommendation 7.4: Companies 
should provide the information 
indicated in the Guide to reporting on 
Principle 7.

Yes

Yes

The Company is committed to the 
identification, monitoring and management 
of risks associated with its business activities 
and has established policies in relation to the 
implementation of practical and effective 
control systems.

Management of the Company is responsible 
for the preparation and maintenance of 
a register of material business risks and 
responses and is required also to report 
to the Board as to the effectiveness of the 
Company’s management of its material 
business risks.

Under the Company’s risk management 
policy, the responsibility for undertaking 
and assessing risk management and 
internal control effectiveness is delegated 
to management. Management is required 
to assess risk management and associated 
internal compliance and control procedures 
and report back to the Board on whether 
those risks are being managed effectively.

The Board has received the reports 
from management required by ASX 
Recommendation 7.2.

Yes

The Board has received the assurances 
required by ASX Recommendation 7.3 in 
respect of its 2014 annual report.

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

Yes

The Company includes in the corporate 
governance statement in its annual reports 
an explanation of any departure from 
ASX Recommendations 7.1, 7.2, 7.3 or 7.4 
(none), whether the Board has received 
the report from management under ASX 
Recommendation 7.2, and whether the Board 
has received assurance from Managing 
Director and the Chief Financial Officer 
under ASX Recommendation 7.3.

Management of the Company is responsible 
for the preparation and maintenance of 
a register of material business risks and 
responses and is required also to report 
to the Board as to the effectiveness of the 
Company’s management of its material 
business risks.

87

 
 
 
 
Corporate Governance Statement

Continued

ASX Recommendation

Compliance (Yes/No)

Explanation

PRINCIPLE 8: REMUNERATE FAIRLY AND RESPONSIBLY

ASX Recommendation 8.1: The board 
should establish a remuneration 
committee.

Yes

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

ASX Recommendation 8.2: The 
remuneration committee should be 
structured so that it:
 – consists of a majority of independent 

directors;

 – is chaired by an independent chair; 

and

 – has at least three members.

ASX Recommendation 8.3: Companies 
should clearly distinguish the 
structure of non-executive directors’ 
remuneration from that of executive 
directors and senior executives.

Yes

Yes

The Board has established a Remuneration, 
Nomination & Governance Committee to 
support and advise the Board in fulfilling its 
responsibilities to shareholders. The role of 
the committee includes attending to matters 
related to the Company’s remuneration 
policy to enable the Company to attract and 
retain executives who will create value for 
shareholders and to arrange performance 
evaluations of those executives. The 
committee also attends to matters relating 
to succession planning and recommends 
candidates for election or re-election to the 
Board. 

The Board has adopted a charter that defines 
the committee’s purpose, composition, 
duties and responsibilities. A copy of this 
charter is available in the governance section 
of the Company’s website.

The structure of the Company’s 
Remuneration, Nomination and Governance 
Committee meets the requirements of ASX 
Recommendation 8.2.

Non-executive directors receive a fixed 
fee and, when appropriate may also be 
eligible to receive share options. Executive 
directors receive a salary or fee and, 
when appropriate, performance based 
remuneration and share options.

88 Northern Iron Annual Report 2014

 
 
 
 
ASX Recommendation

Compliance (Yes/No)

Explanation

ASX Recommendation 8.4: Companies 
should provide the information 
indicated in the Guide to reporting on 
Principle 8.

Yes

The Company includes in its annual reports:
 – an explanation of any departure from 

ASX Recommendations 8.1, 8.2, 8.3 or 8.4 
(none);

 – the existence and terms of any schemes 

for retirement beneﬁts, other than 
superannuation, for non-executive 
directors; and

 – the names of the members of the 
remuneration committee and their 
attendance at meetings of the committee, 
or where a company does not have 
a remuneration committee, how the 
functions of a remuneration committee are 
carried out.

The Board has adopted a formal charter 
of the Remuneration, Nomination and 
Governance Committee, which defines the 
committee’s purpose, composition, duties 
and responsibilities. A copy of this charter 
is available in the governance section of the 
Company’s website.

The Company will determine, and then 
intends to make publically available on 
the Company’s website a summary of, the 
Company’s policy on prohibiting executives 
entering into transactions in associated 
products that limit the economic risk of 
participating in unvested entitlements under 
any equity-based remuneration schemes 
made available by the Company.

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

89

 
 
 
 
Additional Shareholder Information 

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

Additional information required by the ASX Limited (“ASX”) Listing Rules and not disclosed elsewhere in this 
report is set out below.

Shareholdings as at: 8 April 2015

Substantial shareholders
Set out below is an extract from the Company’s register of last substantial shareholder notices as received by 
the company and/or lodged at the ASX. Shareholdings and percentages reported in the table are as reported in 
the most recent notiﬁcations received, however these may differ from current holdings as substantial holders are 
required to notify the Company only in respect of changes which act to increase or decrease their percentage 
holding by at least 1% of total voting rights:

Name of Shareholder

Dalnor Assets Ltd

Tschudi Mining Company AS

OM Holdings Limited

Prominvest AG

Date of 
notice

Number of 
Shares

24/06/14

96,637,800

14/ 1 0/13

67,1 3 3 ,7 2 8

15/ 1 0/12

52,482,500

16/ 1 2/14

28,329,939

% held

19.95%

13.86%

1 1 .03%

5.85%

Voting Rights
The voting rights attaching to Ordinary Shares are governed by the Constitution. On a show of hands, every 
person present who is a member or representative of a member shall have one vote and on a poll, every member 
present in person or by proxy or by attorney or duly authorised representative shall have one vote for each share 
held. No options have any voting rights.

Twenty Largest Shareholders (as at 8 April 2015)

Rank Name

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

11.

12.

13.

14.

15.

16.

17.

18.

19.

J P MORGAN NOMINEES AUSTRALIA LIMITED

TSCHUDI MINING COMPANY AS

OM HOLDINGS LIMITED

CITICORP NOMINEES PTY LIMITED

DNU NOMINEES PTY LIMITED

BNP PARIBAS NOMS PTY LTD 

ASHWATH MEHRA

INKESE PTY LTD

HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED

HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED - A/C 3

NATIONAL NOMINEES LIMITED

UBS NOMINEES PTY LTD

MR ASHWATH MEHRA

ZERO NOMINEES PTY LTD

ABN AMRO CLEARING SYDNEY NOMINEES PTY LTD 

MR JAY EVAN DALE HUGHES 

MR YONG XU

MR JAY HUGHES + MRS LINDA HUGHES 

MR ALEXANDER JASON ELKS

20.

PAN AUSTRALIAN NOMINEES PTY LIMITED

SUB-TOTAL - TOP 20 SHAREHOLDERS
OTHER SHAREHOLDERS

90 Northern Iron Annual Report 2014

No.

201,926,286

67, 1 3 3 ,728

52,482,500

25,1 2 8,525

20,200,000

11,551,368

10,000,000

8,100,000

8,073,0 1 9

7,520,890

6,440,5 1 9

6,407,698

5,702,792

5,335,592

2,990,047

2,265,000

2,000,000

1,500,000

1,390,000

1,170,000

%

41.69

13.86

10.83

5 . 1 9

4 . 1 7

2.38

2.06

1.67

1.67

1.55

1.33

1.32

1 .1 8

1.10

0.62

0.47

0.41

0.31

0.29

0.24

447,3 1 7,964

37,087,350

92.34

7.66

 
 
 
 
Distribution of equity security holders (as at 8 April 2015)

Size of Holding

1 to 1,000

1,001 to 5,000

5,001 to 10,000

10,001 to 100,000

100,001 and over

Number of 
shareholders

Number of  
fully paid shares

228

188

128

312

91

947

36,1 7 1

577,1 7 2

990,576

10,874,373

471,927,022

484,405,314

The number of shareholders holding less than a marketable parcel of ordinary shares is 770. 

On-market buyback
There is no current on-market buyback.

Restricted securities
As at the date of this report, none of the Company’s securities are subject to escrow restrictions.

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

91

 
 
 
 
Additional Shareholder Information 

Continued

Schedule of permits

Tenement Name

Tenement Number

Tenement Type

Area (m2)

Grant Date

Registered Holder

Andehatten

Annahatten

FU-1/2009-FB

G.UTV. 6/2011

Annahatten N

0784/2009-FB

Annahatten Ø

0783/2009-FB

Bjørnefjell 1

Bjørnefjell 2

Bjørnefjell 3

Bjørnefjell 4

Bjørnefjell 5

Bjørnefjell 6

3309/2007-FB

3310/2007-FB

0020/2009-FB

0021/2009-FB

0022/2009-FB

0023/2009-FB

Bjørnevann 10

0785/2008-FB

Bjørnevann 11

0786/2008-FB

Bjørnevann 12

0015/2009-FB

Bjørnevann 13

0016/2009-FB

Bjørnevann 14

0017/2009-FB

Bjørnevann 15

0018/2009-FB

Bjørnevann 16

0019/2009-FB

Bjørnevann 7

3311/2007-FB

Bjørnevann 8

3312/2007-FB

Bjørnevann 9

3313/2007-FB

Bjørnevatn 1

1664/2006-FB

Bjørnevatn 100

1672/2006-FB

Bjørnevatn 101

1673/2006-FB

Bjørnevatn 17

0798/2009-FB

Bjørnevatn 18

0799/2009-FB

Bjørnevatn 19

0800/2009-FB

Bjørnevatn 2

1665/2006-FB

Bjørnevatn 20

0801/2009-FB

Bjørnevatn 3

1666/2006-FB

Bjørnevatn 4

1667/2006-FB

Bjørnevatn 5

1668/2006-FB

Bjørnevatn 6

1669/2006-FB

Claim

Claim

Preclaim

Preclaim

Claim

Claim

Claim

Claim

Claim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

62,500

22/08/2001

Sydvaranger Gruve AS

175,000

18/03/2009

Sydvaranger Gruve AS

250,000

3/03/2010 

Sydvaranger Gruve AS

175,000

3/03/2010 

Sydvaranger Gruve AS

240,000

2/12/2013 

Sydvaranger Gruve AS

250,000

2/12/2013 

Sydvaranger Gruve AS

40,000

2/12/2013 

Sydvaranger Gruve AS

100,000

2/12/2013 

Sydvaranger Gruve AS

280,000

2/12/2013 

Sydvaranger Gruve AS

245,000

18/03/2009

Sydvaranger Gruve AS

80,000

22/10/2008

Sydvaranger Gruve AS

190,000

22/10/2008

Sydvaranger Gruve AS

225,000

18/03/2009

Sydvaranger Gruve AS

180,000

18/03/2009

Sydvaranger Gruve AS

245,000

18/03/2009

Sydvaranger Gruve AS

280,000

18/03/2009

Sydvaranger Gruve AS

245,000

18/03/2009

Sydvaranger Gruve AS

297,600

7/10/2007 

Sydvaranger Gruve AS

240,000

7/10/2007 

Sydvaranger Gruve AS

225,000

7/10/2007 

Sydvaranger Gruve AS

300,000

19/01/2007

Sydvaranger Gruve AS

250,000

19/01/2007

Sydvaranger Gruve AS

280,000

19/01/2007

Sydvaranger Gruve AS

200,000

3/03/2010 

Sydvaranger Gruve AS

50,000

3/03/2010 

Sydvaranger Gruve AS

150,000

3/03/2010 

Sydvaranger Gruve AS

300,000

19/01/2007

Sydvaranger Gruve AS

300,000

3/03/2010 

Sydvaranger Gruve AS

300,000

19/01/2007

Sydvaranger Gruve AS

250,000

19/01/2007

Sydvaranger Gruve AS

250,000

19/01/2007

Sydvaranger Gruve AS

250,000

19/01/2007

Sydvaranger Gruve AS

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

92 Northern Iron Annual Report 2014

 
 
 
 
Tenement Name

Tenement Number

Tenement Type

Area (m2)

Grant Date

Registered Holder

NU 11/1974

NU 12/1974

NU 13/1974

NU 14/1974

NU 15/1974

NU 1/1974

NU 2/1974

NU 3/1974

NU 4/1974

NU 5/1974

NU 6/1974

NU 7/1974

NU 8/1974

NU 9/1974

NU 10/1974

Claim

Claim

Claim

Claim

Claim

Claim

Claim

Claim

Claim

Claim

Claim

Claim

Claim

Claim

Claim

56,000

6/12/2002 

Sydvaranger Gruve AS

112,000

6/12/2002 

Sydvaranger Gruve AS

84,000

6/12/2002 

Sydvaranger Gruve AS

84,000

6/12/2002 

Sydvaranger Gruve AS

84,000

6/12/2002 

Sydvaranger Gruve AS

140,000

6/12/2002 

Sydvaranger Gruve AS

140,000

6/12/2002 

Sydvaranger Gruve AS

140,000

6/12/2002 

Sydvaranger Gruve AS

140,000

6/12/2002 

Sydvaranger Gruve AS

140,000

6/12/2002 

Sydvaranger Gruve AS

112,000

6/12/2002 

Sydvaranger Gruve AS

84000

6/12/2002 

Sydvaranger Gruve AS

84000

6/12/2002 

Sydvaranger Gruve AS

84000

6/12/2002 

Sydvaranger Gruve AS

56000

6/12/2002 

Sydvaranger Gruve AS

0687/2001-FB

Preclaim

117,500

22/08/2001

Sydvaranger Gruve AS

FU-8/2009-FB

Claim

182,500

23/08/2001

Sydvaranger Gruve AS

0688/2001-FB

Preclaim

163,150

24/08/2001

Sydvaranger Gruve AS

FU-9/2009-FB

Claim

136,850

25/08/2001

Sydvaranger Gruve AS

FU-10/2009-FB

Preclaim

49,000

26/08/2001

Sydvaranger Gruve AS

0689/2001-FB

Claim

191,000

27/08/2001

Sydvaranger Gruve AS

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

Bjørnevatn Ø

Bjørnevatn Ø

Bjørnevatn Ø

Bjørnevatn Ø

Bjørnevatn Ø

Bjørnevatn V

Bjørnevatn V

Bjørnevatn V

Bjørnevatn V

Bjørnevatn V

Bjørnevatn V

Bjørnevatn V

Bjørnevatn V

Bjørnevatn V

Bjørnevatn V

Boris Gleb 1

Boris Gleb 1

Boris Gleb 2

Boris Gleb 2

Boris Gleb 3

Boris Gleb 3

Brattli 1

Brattli 2

Brattli 3

Brattli 4

3138/2007-FB

3139/2007-FB

0771/2009-FB

0772/2009-FB

Fisketd. S/Jernt. N

FU-4/2009-FB

Fisketind

Fisketind

Fisketind

Fisketind

Fisketind

NU 31/1974

NU 32/1974

NU 33/1974

NU 34/1974

NU 35/1974

Preclaim

Preclaim

Preclaim

Preclaim

Claim

Claim

Claim

Claim

Claim

Claim

140,000

7/10/2007 

Sydvaranger Gruve AS

120,000

7/10/2007 

Sydvaranger Gruve AS

32,400

3/03/2010 

Sydvaranger Gruve AS

60,000

3/03/2010 

Sydvaranger Gruve AS

45,000

22/08/2001

Sydvaranger Gruve AS

112,000

6/12/2002 

Sydvaranger Gruve AS

112,000

6/12/2002 

Sydvaranger Gruve AS

112,000

6/12/2002 

Sydvaranger Gruve AS

112,000

6/12/2002 

Sydvaranger Gruve AS

112,000

6/12/2002 

Sydvaranger Gruve AS

93

 
 
 
 
Additional Shareholder Information 

Continued

Tenement Name

Tenement Number

Tenement Type

Area (m2)

Grant Date

Registered Holder

4
1
0
2
T
R
O
P
E
R
L
A
U
N
N
A
N
O
R

I

N
R
E
H
T
R
O
N

Fisketind 1

0785/2009-FB

Fisketind 10

0790/2009-FB

Fisketind 11

Fisketind 3

Fisketind 4

Fisketind 5

Fisketind 6

Fisketind 7

Fisketind 8

Fisketind 9

0791/2009-FB

0028/2009-FB

0029/2009-FB

0030/2009-FB

0786/2009-FB

0787/2009-FB

0788/2009-FB

0789/2009-FB

Fisketind Syd 2

1662/2006-FB

Grunntjern

Grunntjern

Grunntjern

Grunntjern

Grunntjern

Grunntjern

NU 40/1974

NU 41/1974

NU 42/1974

NU 43/1974

NU 44/1974

NU 45/1974

Grunntjern 1

0794/2009-FB

Grunntjern 2

0795/2009-FB

Hyttemalmen

Hyttemalmen

Jernhatten

Jernhatten

NU 81/1974

NU 82/1974

NU 77/1974

NU 78/1974

Jerntoppen 1

0787/2008-FB

Jerntoppen 2

0766/2009-FB

Jerntoppen 3

0781/2009-FB

Jerntoppen 4

0782/2009-FB

Kjellmannsåsen

LU 101/1903

Kjellmannsåsen

LU 102/1903

Kjellmannsåsen

LU 105/1903

Kjellmannsåsen

LU 106/1903

Kjellmannsåsen 1

1658/2006-FB

Kjellmannsåsen 2

1659/2006-FB

Kjellmannsåsen 3

1660/2006-FB

Kjellmannsåsen 4

1661/2006-FB

Kjellmannsåsen 5

3135/2007-FB

Kjellmannsåsen 6

3136/2007-FB

Kjellmannsåsen 7

3137/2007-FB

94 Northern Iron Annual Report 2014

Preclaim

Preclaim

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Preclaim

Preclaim

Preclaim

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Preclaim

Preclaim

Preclaim

Preclaim

Claim

Claim

Claim

Claim

Claim

Claim

Preclaim

Preclaim

Claim

Claim

Claim

Claim

Preclaim

Preclaim

Preclaim

Preclaim

Claim

Claim

Claim

Claim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

200,000

3/03/2010 

Sydvaranger Gruve AS

250,000

3/03/2010 

Sydvaranger Gruve AS

175,000

3/03/2010 

Sydvaranger Gruve AS

102,400

2/04/2009 

Sydvaranger Gruve AS

235,000

19/01/2007

Sydvaranger Gruve AS

9,900

2/04/2009 

Sydvaranger Gruve AS

280,000

2/04/2009 

Sydvaranger Gruve AS

35,100

3/03/2010 

Sydvaranger Gruve AS

240,000

3/03/2010 

Sydvaranger Gruve AS

138,000

3/03/2010 

Sydvaranger Gruve AS

300,000

3/03/2010 

Sydvaranger Gruve AS

84,000

6/12/2002 

Sydvaranger Gruve AS

84,000

6/12/2002 

Sydvaranger Gruve AS

84,000

6/12/2002 

Sydvaranger Gruve AS

84,000

6/12/2002 

Sydvaranger Gruve AS

84,000

6/12/2002 

Sydvaranger Gruve AS

84,000

6/12/2002 

Sydvaranger Gruve AS

220,000

3/03/2010 

Sydvaranger Gruve AS

299,750

3/03/2010 

Sydvaranger Gruve AS

56,000

6/12/2002 

Sydvaranger Gruve AS

56,000

6/12/2002 

Sydvaranger Gruve AS

140,000

6/12/2002 

Sydvaranger Gruve AS

140,000

6/12/2002 

Sydvaranger Gruve AS

250,000

22/10/2008

Sydvaranger Gruve AS

25,000

3/03/2010 

Sydvaranger Gruve AS

100,000

3/03/2010 

Sydvaranger Gruve AS

120,000

3/03/2010 

Sydvaranger Gruve AS

lengdeutmål 6/12/2002 

Sydvaranger Gruve AS

lengdeutmål 6/12/2002 

Sydvaranger Gruve AS

lengdeutmål 6/12/2002 

Sydvaranger Gruve AS

lengdeutmål 6/12/2002 

Sydvaranger Gruve AS

250000

19/01/2007

Sydvaranger Gruve AS

250000

19/01/2007

Sydvaranger Gruve AS

250000

19/01/2007

Sydvaranger Gruve AS

250000

19/01/2007

Sydvaranger Gruve AS

78,750

7/10/2007 

Sydvaranger Gruve AS

275,000

7/10/2007 

Sydvaranger Gruve AS

200,000

7/10/2007 

Sydvaranger Gruve AS

 
 
 
 
Tenement Name

Tenement Number

Tenement Type

Area (m2)

Grant Date

Registered Holder

Mattilamalmen 1

FU-6/2009-FB

Preclaim

88,150

22/08/2001

Sydvaranger Gruve AS

Mattilamalmen 1

0685/2001-FB

Claim

104,350

23/08/2001

Sydvaranger Gruve AS

Mattilamalmen 2

0686/2001-FB

Preclaim

280,000

22/08/2001

Sydvaranger Gruve AS

FU-5/2009-FB

Claim

252,000

22/08/2001

Sydvaranger Gruve AS

0779/2009-FB

0780/2009-FB

Preclaim

Preclaim

90,000

3/03/2010 

Sydvaranger Gruve AS

250,000

3/03/2010 

Sydvaranger Gruve AS

Ørnåsen

Ørnåsen 1

Ørnåsen 2

Ørnevann

Ørnevann

Ørnevann

Ørnevann

NU 63/1974

NU 64/1974

NU 65/1974

NU 66/1974

Ørnevannet 1

0773/2009-FB

Ørnevannet 2

0774/2009-FB

Ørnevannet 3

0775/2009-FB

Ørnevannet 4

0776/2009-FB

Reitan 3

Reitan 4

Reitan 5

Reitan 6

Reitan 7

Reitan 8

3298/2007-FB

3299/2007-FB

3300/2007-FB

3301/2007-FB

3302/2007-FB

3303/2007-FB

Reitanmalmen 1

FU-2/2009-FB

Reitanmalmen 2

FU-3/2009-FB

Søstervann

Søstervann

Søstervann

Søstervann

NU 46/1974

NU 47/1974

NU 48/1974

NU 49/1974

Søstervann 1

0796/2009-FB

Søstervann 2

0797/2009-FB

Teltbukt 1

Teltbukt 2

0777/2009-FB

0778/2009-FB

Claim

Claim

Claim

Claim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Claim

Claim

Claim

Claim

Claim

Claim

Preclaim

Preclaim

Preclaim

Preclaim

84,000

6/12/2002 

Sydvaranger Gruve AS

84,000

6/12/2002 

Sydvaranger Gruve AS

84,000

6/12/2002 

Sydvaranger Gruve AS

84,000

6/12/2002 

Sydvaranger Gruve AS

230,000

3/03/2010 

Sydvaranger Gruve AS

297,000

3/03/2010 

Sydvaranger Gruve AS

261,000

3/03/2010 

Sydvaranger Gruve AS

299,750

3/03/2010 

Sydvaranger Gruve AS

145,000

7/10/2007 

Sydvaranger Gruve AS

266,000

7/10/2007 

Sydvaranger Gruve AS

266,000

7/10/2007 

Sydvaranger Gruve AS

280,000

7/10/2007 

Sydvaranger Gruve AS

175,000

7/10/2007 

Sydvaranger Gruve AS

250,000

7/10/2007 

Sydvaranger Gruve AS

150,000

22/08/2001

Sydvaranger Gruve AS

137,500

22/08/2001

Sydvaranger Gruve AS

112,000

6/12/2002 

Sydvaranger Gruve AS

112,000

6/12/2002 

Sydvaranger Gruve AS

112,000

6/12/2002 

Sydvaranger Gruve AS

112,000

6/12/2002 

Sydvaranger Gruve AS

247,500

3/03/2010 

Sydvaranger Gruve AS

247,500

3/03/2010 

Sydvaranger Gruve AS

240,000

3/03/2010 

Sydvaranger Gruve AS

200,000

3/03/2010 

Sydvaranger Gruve AS

4
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L
A
U
N
N
A
N
O
R

I

N
R
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T
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Teltbuktmalmen

FU-7/2009-FB

Claim

6,615

22/08/2001

Sydvaranger Gruve AS

95

 
 
 
 
Additional Shareholder Information 

Continued

Tenement Name

Tenement Number

Tenement Type

Area (m2)

Grant Date

Registered Holder

Tverrdalen

Tverrdalen

Tverrdalen

Tverrdalen

Tverrdalen

Tverrdalen

Tverrdalen

NU 24/1974

NU 25/1974

NU 26/1974

NU 27/1974

NU 28/1974

NU 29/1974

NU 30/1974

Tverrdalen 1

Tverrdalen 2

0792/2009-FB

0793/2009-FB

Vakkeråsen 1

0690/2001-FB

Vakkeråsen 2

0691/2001-FB

Vakkeråsen 3

0692/2001-FB

Vakkeråsen 4

0693/2001-FB

Vakkeråsen 5

3304/2007-FB

Vakkeråsen 6

3305/2007-FB

Vakkeråsen 7

3306/2007-FB

Vakkeråsen 8

3307/2007-FB

Vakkeråsen 9

3308/2007-FB

Varrevann 1

Varrevann 2

Varrevann 3

Varrevann 4

Varrevann 5

Varrevann 6

0694/2001-FB

0695/2001-FB

0696/2001-FB

0697/2001-FB

3296/2007-FB

3297/2007-FB

Claim

Claim

Claim

Claim

Claim

Claim

Claim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

Preclaim

112,000

6/12/2002 

Sydvaranger Gruve AS

112,000

6/12/2002 

Sydvaranger Gruve AS

112,000

6/12/2002 

Sydvaranger Gruve AS

112,000

6/12/2002 

Sydvaranger Gruve AS

112,000

6/12/2002 

Sydvaranger Gruve AS

168,000

6/12/2002 

Sydvaranger Gruve AS

168,000

6/12/2002 

Sydvaranger Gruve AS

299,750

3/03/2010 

Sydvaranger Gruve AS

299,750

3/03/2010 

Sydvaranger Gruve AS

160,000

22/08/2001

Sydvaranger Gruve AS

240,000

22/08/2001

Sydvaranger Gruve AS

240,000

22/08/2001

Sydvaranger Gruve AS

175,000

22/08/2001

Sydvaranger Gruve AS

90,000

7/10/2007 

Sydvaranger Gruve AS

90,000

7/10/2007 

Sydvaranger Gruve AS

150,000

7/10/2007 

Sydvaranger Gruve AS

150,000

7/10/2007 

Sydvaranger Gruve AS

120,000

7/10/2007 

Sydvaranger Gruve AS

250,000

22/08/2001

Sydvaranger Gruve AS

250,000

22/08/2001

Sydvaranger Gruve AS

250,000

22/08/2001

Sydvaranger Gruve AS

60,000

22/08/2001

Sydvaranger Gruve AS

170,000

7/10/2007 

Sydvaranger Gruve AS

280,000

7/10/2007 

Sydvaranger Gruve AS

4
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96 Northern Iron Annual Report 2014

 
 
 
 
Corporate Directory

Directors
PR Bilbe 
A Beckmand 

A Mehra 

FH Tschudi 

PC Church 

PS Larsen 

Chairman
 Managing 
Director
 Non-Executive 
Director
 Non-Executive 
Director
 Non-Executive 
Director
 Alternate Director 
for FH Tschudi

Company Secretary
AJ Neuling

Auditors
HLB Mann Judd 
(WA Partnership) 
Level 4, 130 Stirling Street 
Perth WA 6000

Bankers
DNB Bank ASA 
Innovasjon Norge 
Westpac Banking Group Limited

Registered Office and Principal 
Place of Business in Australia
Level 1, 44 Ord Street 
West Perth WA 6005

Tel 
+61 8 9321 9334 
Fax  +61 8 9321 9335 
Email  info@northerniron.com.au 
Web  www.northerniron.com.au

Principal Place of Business
Sydvaranger Gruve AS 
Postboks 412 
Sydvaranger Industriområde 
N-9900 Kirkenes 
Norway

Tel 
+47 928 09 900 
Fax  +47 78 97 78 00

Share Registry
Computershare Investor 
Services Pty Limited 
Level 2, 45 St Georges Terrace 
Perth WA 6000 
Australia

Investor Enquiries  
1300 557 010 
(within Australia)

Investor Enquiries 
 +61 3 9415 4000  
(outside Australia)

Fax  +61 8 9323 2033

Stock Exchange Listing
Securities of Northern Iron 
Limited are listed 
on ASX Limited.

ASX Code NFE – ordinary shares

ASX Limited  
Exchange Centre
Level 4, 20 Bridge Street 
Sydney NSW 2000, Australia

Shareholder and Participant 
Enquiries: 131 279 
(within Australia)

Shareholder and Participant 
Enquiries: +61 2 9338 0000 
(outside Australia)

Fax 

 +61 2 9227 0885 

Solicitors
Clifford Chance 
Level 7, 190 St Georges Terrace 
Perth WA 6000

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FOREST 
MANAGEMENT

RECYCLED 
CONTENT

CHLORINE FREE

MANAGEMENT 
SYSTEMS

CARBON 
NEUTRAL

This document is printed on Monza Recycled. It is manufactured 
and certiﬁed under strict conditions, which ensures that all virgin 
and recycled pulp is derived from well-managed forests and 
controlled sources. It contains elemental chlorine free bleached 
pulp and is manufactured by an ISO 14001 certiﬁed mill.

97

 
 
 
 
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