Annual Financial Report
for the financial year ended
30 June 2018
1
Table of Contents
Directors’ Report
Corporate Governance Statement
Auditor’s Independence Declaration
Consolidated Statement of Profit or Loss and Other Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Notes to the Consolidated Financial Statements
Directors’ Declaration
Auditor’s Report
ASX Additional Information
84 119 904 880
Level 6, 412 Collins Street Melbourne VIC 3000
ABN
Address
Telephone +61 2 6076 2336
Email
Website
info@dartmining.com.au
www.dartmining.com.au
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2
Directors’ Report
The Directors of Dart Mining NL submit their report for the year ended
30 June 2018 and to the date of this report.
Operating and Financial Review
Corporate
Several milestones were achieved at a corporate level during the year.
Most significant was the settlement of the company’s long running
dispute with AusIndustry over Research and Development claims. This
issue had been an impediment to company on many fronts not least of
which were the limitations it imposed on the company’s ability to raise
capital for exploration and development work. Management time and
expense associated with the dispute crimped our ability to advance
exploration programs at a desirable pace. The issue is now behind us, as
are other distracting activities that came in the wake of the board change
in June 2015.
In February 2018 the company appointed Dr. Denis Clarke to the board.
Denis brings with him enormous experience in the mining business and
is particularly strong technically. His input and efforts have enabled the
fast tracking of our Lithium exploration program to a point where we are
about to embark on a significant drilling program as we further advance
our knowledge and understanding of the highly prospective Dorchap
Dyke Swarm.
The company has further sought to strengthen its technical credentials
through the creation of a technical advisory board. Three appointments
have been made so far including Chris Bain (Exploration Geology), David
Foster (Metallurgy and Mineral processing) and Dean Turnbull
(Exploration Geology). Appointees will assist the board in determining
the best strategy for the company.
In May-June 2018 the company successfully completed a capital raising
in the form of a Rights Issue and free attaching option. Proceeds raised
were $1.927m before costs. Subscription from existing shareholders was
very strong. Shortfall placement was made to a range of experienced
professional investors.
Resource consultant, RSC Mining and Mineral Exploration Ltd (RSC), was
appointed to manage and fast track the Lithium exploration program in
the Dorchap Dyke swarm. RSC has helped the company to advance the
program rapidly, and we expect to drill test targets in late-2018.
Helicopter surveys identified about one hundred and eighty outcrops in
heavily wooded terrain. Subsequently examinations of outcrops using
drone aircraft has enabled geological field crews to distinguish those
outcrops containing pegmatites as opposed to granite or metasediments.
This rapid, efficient, positive identification of pegmatite dykes have
significantly advanced the project by reducing the number of outcrops
requiring ground truthing. It is estimated that there are 1,800 – 2,500
pegmatite dykes throughout the Dorchap Dyke Swarm so despite our
progress to date there is still much exploration remaining.
Financial Markets
Financial markets have remained buoyant in certain sectors whilst others
have been hit hard. The junior explorer sector has had a difficult year.
Mining Majors have done well, and we anticipate that in time this will
trickle down to smaller capitalised mining stocks. There does seem to be
the potential for significant M&A activity when you consider the deep
discounts on some very attractive mining projects. There seems to be a
continued scepticism in the Lithium sector compounded by the opacity of
trade in the underlying commodity. Producers of Lithium have enjoyed
an extended period of excellent margins and continue to do so. It seems
that investors are failing to grasp the “once in a century” scale of global
electrification that is upon us. As one Lithium producer CEO put it
“financial markets seem to be operating in a parallel universe”
Commodities
Lithium (Li ₂CO ₃)
Reported spot prices for Lithium Carbonate (Li ₂CO ₃) ex China have been
under pressure since the beginning of the year falling to a reported circa
US$15,000 per tonne. Contract prices and offtake agreed prices have
traded at significant premiums to spot which makes us confident that
Lithium Carbonate will offer producers excellent margin for years to
come.
Gold (Au)
US$ Gold has been under pressure this year but when measured in A$ it
has remained steady with a declining A$/$USD exchange rate. Margins
for Australian Gold producers are excellent, and we continue to believe
that they will remain elevated for a significant period.
Copper (Cu)
$USD Copper prices have also been under pressure but with exchange
rate relief A$ producer margins remain good. Positive fundamentals from
the supply and demand side make copper an attractive commodity over
the medium and long term.
Molybdenum (Mo)
Molybdenum Oxide prices - having bottomed in 2015 at US$5.00/pound
- have more than doubled to circa US$12.00/pound. There are new
potential
the
technologies/chemistries are still being assessed. China’s push for better
quality steel has led to rising demand for the Mo also. We retain a
watching brief on Mo and are particularly interested in its potential
application in battery chemistry.
applications
for Mo
batteries
although
in
Exploration Review
Dart has achieved several significant milestones over the past year and
has made a number of tenement applications over the company’s key
projects. These include Retention Licence (RL) applications to secure the
Mt. Unicorn base and precious metals regional Porphyry system and the
Fairleys Gold Project as well as an expanded mining license to cover the
full Mountain View line of gold workings within the Dart Goldfield. Once
granted, the Retention Licences will secure tenure over the company’s
key projects for up to 10 years, with up to a further 10-year renewal
period and ensure Dart Mining is able to continue to build value in the
projects and leverage any future improvements in commodity prices.
Dart has continued to build on the discovery of the underexplored
Dorchap LCT (Lithium, Cesium, Tantalum) pegmatite swarm, and has
identified pegmatites with potential
lithium
mineralisation. Further lithium exploration has prompted an application
for a new exploration license adjacent to the Dorchap Dyke Swarm.
Dart’s previously granted tenements and applications cover some 1000
km2. This area hosts prospects that contribute to the company’s three
key strategy areas of lithium, orogenic gold and porphyry exploration
and development.
significant
for
Lithium
Lithium mineralisation was first confirmed by Dart Mining from the
southern end of the Dorchap Dyke Swarm at Glen Wills (See DTM ASX 9
August 2016) with two grab samples taken at the Blue Jacket Dyke
showing results of up to 1.57% (Li2O). Further results were reported
(ASX 3 April 2017) from limited grab and rock chip sampling along the
northern end of the Dyke Swarm with up to 4m @ 1.13% (Li2O) at the
Gosport dyke group and (ASX 10 May 2018) a grab sample of 2.37% Li2O
from the Boones area – Eskdale. The identification of spodumene (the
most common hard rock lithium ore mineral) and more recently petalite
by X-ray diffraction (XRD) within the dykes along the northern section of
the Swarm near Eskdale prompted a focused, fast-tracked exploration
program for 2018.
3
Directors’ Report
Dart recently announced the appointment of international geological
contracting and consulting group, RSC Mining and Mineral Exploration
Ltd (RSC), (DTM ASX 21 June 2018) and a successful capital raising of
$1.927m (DTM ASX 24 July 2018). This enabled a field work program to
get underway to rapidly ground check up to 184 helicopter targets
identified during extensive surveys of the dyke swarm. The current field
program continues to systematically assess the targets with ground
crews of up to 3 geologists and field assistants. Drilling is planned over
several phases to allow fast-track testing of several pegmatite dykes
where drill access is more easily established with minimal ground
disturbance. This staged approach should allow timely work plan
approvals and initial drill assay results possibly as early as December.
Ongoing field checks are expected to identify further new dykes that
require follow-up exploration.
Dart remains committed to the development of this new porphyry
province and further unlocking its potential.
An RL application
(RL006616) was made in October 2017 to secure the Unicorn base and
precious metal porphyry system near Corryong to allow further
development of the porphyry discovery should commodity prices
improve.
The granting of EL006277 at Granite flat now expands the breadth of
porphyry potential held by the company with the Banimboola
Granodiorite known to host porphyry style stockwork copper and gold
mineralisation as well as high sulphide lode gold reefs.
Porphyry exploration is best suited to collaborative partnerships with
significant interest now being expressed in the southern end of the
Lachlan Fold Belt by major mining companies.
Financial overview
Operating results for the year
The loss for the consolidated entity after income tax was $2,453,665
(2017: loss $715,393). This result is consistent with expectations of costs
associated with the exploration and development programs budgeted
and undertaken that reflect:
• costs associated with managing the exploration program;
• corporate overheads associated with statutory and regulatory
requirements as a consequence of being listed on the Australian
Securities Exchange.
Review of financial position
At the end of the financial year, a proportion of the funds raised in prior
financial years were held by the Group as cash investments for use in
future financial periods. The Group strives to maximise the return on
these funds for exploration purposes by investing surplus funds and
minimising expenditure on corporate overheads.
Orogenic Gold
The Orogenic gold strategy aims to identify and further define gold
resources within the current tenement holdings and identify prospective
new areas. The key gold prospects are located at Rushworth, Mountain
View, Fairleys, Onslow / Onslow South and Granite Flat, held under
various mining, retention and exploration license tenure.
Rushworth Gold Project
At Rushworth, accounts of coarse, visible gold means there is a significant
nugget effect that will make individual drill sample grades un-
representative. To partly overcome this problem, a series of close-spaced
reverse circulation (RC) drill sections has been proposed, but not yet
approved, along some 400m of the reef system. These drill sections
would act as a bulk sample collection method (totaling several hundred
tonnes once combined) to test the stacked fault reef geological model and
target sections with previous high-grade drill intercepts along the fault
system. The drill sections would each make up a number of individual
bulk samples along the strike of the mineralised system. Processing of
the bulk samples would allow reconciliation of drill grades from past
exploration RC drilling and also test the geological model for the area with
the aim to better define the average gold grade and potential economics
of the project. Further drilling across the Rushworth mining licenses and
trial mining pits would be dependent upon the results of this initial
program.
Mountain View Gold Project
The Mountain View Mining license (MIN5559) was surrendered in order
to allow for the application for a larger Mining Licence (MIN006619),
which would support the optimal open pit design for the possible
Mountain View development and other similar targets identified
immediately along strike. MIN006619 license application is proceeding
through the approvals pathway and is expected to be granted in the
December Quarter 2018.
Fairlys Gold Project
An RL application (RL006615) was made in October 2017 to secure the
Fairleys Gold Project near Bright. We expect approval by March 2019.
Fairleys is a disseminated sulphide gold project with mineralisation
similar to the upper sections of the Fosterville Fault, currently being
mined in Central Victoria by Kirkland Lake Gold Ltd. Once approved,
further resource definition work can be advanced allowing an assessment
of project economics and the direction of further work.
Porphyries
Dart was the first explorer to recognize the potential for and go on to
define a new porphyry mineralisation province in Victoria’s north east.
Dart pioneered a geological model that identified the potential for
mineralised porphyry systems in the north east in 2006. This model was
instrumental in the identification of the Unicorn and Morgan base and
precious metals porphyry systems discovered in 2008 and is still in use
by the company today. This early model is now being substantiated by
the Geological Survey of Victoria with recent published developments in
the understanding of the geological history of eastern Australia.
4
Directors’ Report
Information on Directors
The names and details of the Company’s Directors in office during the
financial year and until the date of this report are as follows. Directors
were in office for this entire period unless otherwise stated.
Names, qualifications, experience and special
responsibilities
James Chirnside Chairman / Managing Director
Appointed 18 June 2015
James Chirnside has been professionally engaged in financial and
commodity markets over a thirty--year period. Since returning to
Australia and establishing his own asset management company in 2002,
James has been involved in equities investment across the Asia Pacific
region.
In 1992 James moved to Hong Kong with Regent Fund Management
where he was responsible for resources investment as well as the firm’s
proprietary activities in base and precious metals. He worked for
Investment Bank County NatWest (London) where he traded financial
and commodity physical and derivative instruments. James managed the
overnight commodity--trading desk for Bell Commodities (Melbourne)
where mining clients hedged metal production through the London Metal
Exchange. During the early part of his career he worked for global
commodity trading house Bunge where he traded in a range of food, fiber,
steel and metal commodities.
Prior to studying at Edith Cowan University in Perth, Western Australia,
James worked for Mt Newman Mining in the Pilbara region as a
geologist’s assistant.
Other current directorships of listed companies
Dart Mining NL
Mercantile Investments Ltd
WAM Capital Ltd
Cadence Capital Ltd
Ask Funding Ltd
IPE Limited
Former directorships of listed companies in the last three years
None
Luke Robinson Non-executive Director (independent)
Appointed 18 June 2015
Luke Robinson has worked in Financial Markets for 20 years with a
number of stockbroking and advisory firms including Phillip Capital and
Citi Group.
Recently he has worked as an executive director of Melanesian
Exploration, a privately held company, where he was responsible for
researching, identifying and acquiring mainly petroleum assets in Papua
New Guinea. Luke was a senior client advisor with Philip Capital where
he was responsible for advising Institutional and Sophisticated individual
investors in the Australian share market. Luke’s main focus was in
resources companies including mining and energy where he originated
and distributed capital raisings for small and mid-sized companies. Luke
holds a B. Sc. in Microbiology from the University of Melbourne.
Other current directorships of listed companies
None.
Former directorships of listed companies in the last three years
None.
Russell Simpson Non-executive Director
Appointed 18 June 2015
Russell Simpson has been a successful Riverena Farmer, Merino breeder
and irrigator from two Murray River water irrigation schemes for over 40
years. Taking a keen interest
in commodity markets, particularly
agricultural, gold and metals for the past 20 years, he has been an investor
in Dart Mining since 2008 and a substantial shareholder since 2009.
Other current directorships of listed companies
None.
Former directorships of listed companies in last three years
None.
Denis Clarke Non-executive Director (independent)
Appointed 14 March 2018
Dr Clarke is a geologist with over 50 years of experience in senior technical,
financial and corporate positions in the mining and exploration industry
globally. In particular, over 16 years Dr Clarke played a significant role in
the extraordinary growth of Plutonic Resources Limited through his
positions as General Manager of
the Exploration, Finance and
Administration, and Corporate Divisions of the company at various times.
He was part of the team which transformed Plutonic into one of Australia’s
largest gold producers with up to five operating mines and a market
capitalisation of over $1 billion. Prior to joining Plutonic, he spent 10 years
in exploration mostly in Canada with Rio Algom Limited (a subsidiary of Rio
Tinto). Post-1998, as Director and Consultant for 10 years, he contributed
to the development of Troy Resources Limited from small explorer to
successful international gold miner. He has been Non-Executive Chairman
of five ASX-listed exploration and mining companies including BCD
Resources Limited (formerly Beaconsfield Gold Limited). Additionally, he
has served as Non-Executive director of four other listed resource
companies.
Dr Clarke holds a B. Sc. in Geology and B. A. (Economics and Statistics) from
Queensland University and a Ph. D. (Geology) from Stanford University in
California. He is a Fellow of the Australasian Institute of Mining and
Metallurgy.
Meredith Lyons Alternate Non-executive Director
Appointed 23 June 2015
Meredith was appointed as an alternate Director by Russell Simpson to act
on his behalf when he is not able to exercise his powers as a Director. Her
appointment will continue until Mr Simpson revokes it or ceases to be a
Director, whichever occurs first.
Other current directorships of listed companies
None.
Former directorships of listed companies in last three years
None.
Julie Edwards Company Secretary
Appointed 1 July 2015
Julie Edwards was appointed as the Chief Financial Officer of Dart on 8 July
2015. She has had over 20 years’ experience and involvement in the
management of accounting and finance functions. She holds a Bachelor of
Commerce degree, is a member of CPA Australia, holds a CPA Public
Practice Certificate and is a registered Tax Agent.
Other current directorships of listed companies
None.
Former directorships of listed companies in last three years
None.
5
Directors’ Report
Shareholdings of directors and other key
management personnel
The interests of each director and other key management personnel, directly
and indirectly, in the shares and options of Dart Mining NL at the date of this
report are as follows
Key management
personnel
R M Simpson
J Chirnside
L Robinson
D Clarke
Ordinary
shares
51,275,683
5,940,595
2,962,963
22,222
Listed options over
ordinary shares
18,888,888
2,970,298
740,741
5,556
Corporate information
Corporate structure
Dart Mining NL is a no liability company limited by shares that is
incorporated and domiciled in Australia. Dart Mining NL has prepared a
consolidated financial report incorporating Dart Resources Pty Ltd, Mt
Unicorn Holdings Pty Ltd and Mt View Holdings Pty Ltd all of which were
controlled by the Company (comprising the Group) during the financial year
and are included in the financial statements.
Principal activities
The company continues to pursue its minerals exploration activities with a
focus on its Dorchap Lithium project. Orogenic Gold projects have also been
advanced and joint venture discussion around its Porphyry tenement assets
have commenced with multiple counterparties.
Employees
The Company had 4 employees as at 30 June 2018 (2017:
5 employees).
Dividend
No dividends in respect of the current financial year have been paid,
declared or recommended for payment.
Summary of shares and options on issue
At 30 June 2018, the Group has 731,871,191 ordinary shares and
295,087,533 listed options on issue. Details of the options are as follows:
Number of
shares under
option
Class of
shares
Exercise price
(cents)
Expiry date
295,087,533
Ordinary
1
28 February 2019
Significant events after balance date
In July 2018 the Company placed the shortfall of the Entitlement Offer under the
prospectus lodged on 30 May 2018. The amount raised under the shortfall was
$1,122,687 bringing the total amount raised under the Entitlements Offer to
$1,927,265. 124,743,041 fully paid ordinary shares were issued under the
shortfall placement at $0.009 per share with attaching options exercisable at one
cent and expiring 28 February 2019.
Future developments, prospects and business
strategies
The company will continue to advance exploration activities in its three
nominated strategies those being; Lithium, Orogenic Gold, and Porphyries. Field
work emphasis will be in Lithium exploration in the near term but the company
has scheduled additional exploration and development activities for Orogenic
Gold and Porphyries over the coming months.
As the Group is listed on the Australian Securities Exchange, it is subject to the
continuous disclosure requirements of the ASX Listing Rules which require
immediate disclosure to the market of information that is likely to have a material
effect on the price or value of Dart Mining NL’s securities.
The Board of Directors believe they have been compliant with the continuous
disclosure requirements throughout the reporting period and to the date of this
report.
Environmental regulation
The economic entity holds participating interests in a number of exploration
tenements. The various authorities granting such tenements require the
tenement holder to comply with the terms of the grant of the tenement and all
directions given to it under those terms of the tenement. There have been no
known breaches of the tenement conditions and no such breaches have been
notified by any government agencies during either the year ended 30 June 2018
or at the date of this report.
Directors Meetings
The number of Directors meetings held during the year and the numbers of
meetings attended by each Director and Committee member were as
follows:
Directors
Held
Board of Directors
Entitled to
attend
Attended
J Chirnside
D Clarke
L Robinson
R Simpson
9
9
9
9
9
5
9
9
9
5
9
9
During the financial year, no incentive rights were granted to Key Management
Personnel of the Company.
There were no meetings held by the remuneration and nomination committee
or audit and risk committee.
Significant changes in state of affairs
There were no significant changes in the state of affairs of the Group
during the financial year.
Indemnification and insurance of directors and
officers
The Company has entered into Deeds of Indemnity with the Directors and
Officers of the Company, indemnifying them against certain liabilities and costs
to the extent permitted by law.
The Company has also agreed to pay a premium in respect of a contract insuring
the directors and officers of the Company. Full details of the cover and premium
are not disclosed as the insurance policy prohibits the disclosure.
6
Directors’ Report
Proceedings on behalf of the Company
No persons have applied for leave of a 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.
Non-audit services
The directors are satisfied that the provision of non-audit services during the
year by the auditor (or by another person or firm on the auditor’s behalf) is
compatible with the general standards of independence for auditors imposed
by the Corporations Act 2001.
Auditor independence declaration
The auditor’s independence declaration for the year ended 30 June 2018 has
been received and is included in this report.
Remuneration Report - Audited
This remuneration report, which forms part of the Directors’ report, sets out
information about the remuneration of the Group’s directors and other key
management personnel for the financial year ended 30 June 2018. The
prescribed details for each person covered by this report are detailed below.
Details of Directors and other Key
Management Personnel
Directors and other key management personnel of the Group during and since
the end of the financial year are as follows:
Directors
J Chirnside (appointed 18 June 2015)
L Robinson (appointed 18 June 2015)
R Simpson (appointed 18 June 2015)
D Clarke (appointed 14 March 2018)
Other Key Management Personnel
D G Turnbull (resigned on 30 April 2018)
Remuneration philosophy
The Board of Directors of Dart Mining NL is responsible for determining and
reviewing compensation arrangements for the Directors, the Managing
Director and other key management personnel after consideration is given to
the recommendations of the Company’s Remuneration and Nomination
Committee. The Remuneration and Nomination Committee’s policy is to
ensure that a remuneration package properly reflects the person’s duties and
responsibilities, with the overall objective of ensuring maximum stakeholder
benefit from the retention of a high quality Board and executive team. The
Board of the Company reviews and adopts or amend the recommendations of
the Remuneration and Nomination Committee as proposed. The officers of
the Company are given the opportunity to receive their base emolument in a
variety of forms, including cash, fringe benefits such as motor vehicles and
incentive rights. It is intended that the manner of payment chosen will be
optimal for the recipient without creating undue cost to the Group.
To assist in achieving these objectives, the Board’s objective is to
link the
nature and amount of Directors and other key management personnel
emoluments to the Company’s financial and operational performance. It is the
Board’s policy that employment contracts are entered into with all senior
executives. At the date of this report, executive remuneration is set at levels
approved by the Board.
The Board has implemented these guaranteed levels of remuneration which
are not dependent on performance in order to ensure the Group’s ability to
retain quality personnel.
Employment Agreements are entered into with Executive Directors and
specified executives.
Remuneration structure
In accordance with best practice corporate governance, the structure of
non-executive and executive director remuneration is separate and
distinct.
Non-executive director remuneration
Objective
The Board seeks to set aggregate remuneration at a level which provides
the Company with the ability to attract and retain directors of the highest
calibre at a cost that is acceptable to shareholders.
Structure
The Constitution and the ASX Listing Rules specify that the aggregate
remuneration of Non-executive Directors shall be determined from time
to time by a general meeting of the Company’s shareholders. An amount
not exceeding the sum determined is then divided between the directors
as agreed whilst maintaining a surplus amount that can be attributed to
additional Non-executive Directors should they be appointed at any time.
The latest determination was sought and granted at the Company’s AGM
on 2 October 2012 whereby shareholders approved an aggregate
remuneration of $475,000 per year.
The amount of aggregate remuneration sought to be approved by
shareholders and the manner in which it is apportioned amongst
directors is reviewed annually. The Board considers advice from external
consultants as well as the fees paid to Non-executive Directors of
comparable companies when undertaking the annual review process.
Each Non-executive Director receives a fee for being a Director of the
Group. Directors who are called upon to perform extra services beyond
the Director’s ordinary duties or who are members of Board Committees
may be paid additional fees for those services.
The remuneration of Non-executive Directors for the financial year ended
30 June 2018 is detailed in this report.
Senior executive remuneration
Objective
The Board aims to reward Executives with a level and mix of
remuneration commensurate with their position and responsibilities
within the Company and so as to:
• reward Executives for Company, business unit and individual
performance against targets set by reference to appropriate
benchmarks;
• align the interests of Executives with those of shareholders;
• link reward with the strategic goals and performance of the Company;
and
• ensure total remuneration is competitive by market standards.
Structure
In determining the level and make-up of executive remuneration,
Board obtained independent advice from external consultants
on market levels of remuneration for comparable executive roles. It is the
Board’s policy that employment contracts are entered into with all senior
executives.
the
Service contracts
Service contracts were entered into with Executive Directors and Specified
Executives.
7
Director’s Report
Managing Director
The terms of an employment agreement with the MD, James Chirnside,
issued on 19 June 2015 include inter alia:
Dean G Turnbull (resigned 30 April 2018)
The terms of an employment agreement with Dean Turnbull include inter
alia:
• A fixed remuneration package of $150,000 plus superannuation per
annum, and director’s fees of $30,000 plus Superannuation whilst
engaged as a director of Dart Mining NL.
• Reimbursement of all business-related expenses and a motor vehicle for
business use and reasonable private use or a reasonable allowance should
he provide his own motor vehicle to perform work for Dart.
• The agreement can be terminated by either party upon 3 months’
notice being given.
• A remuneration package of $ 135,000 plus Superannuation per annum,
with annual reviews, together with reimbursement of all business
related expenses including motor vehicle running and maintenance
expenses plus statutory annual leave entitlements;
• A restraint on Dean undertaking additional part-time consulting or
provision of other services which may conflict with the activities of
Dart without the approval of the Chairman which may not be
unreasonably withheld. This restraint continues for 12 months after
cessation of engagement with the Company;
• The agreement can be terminated by either party upon 3 months notice
being given; and
• A bonus may be paid to Dean at the sole discretion of the Board which
is based on certain performance criteria being exceeded for any pre-
determined period.
Other Key Management Personnel
All other KMP have rolling contracts with standard termination provisions as follows:
Notice
period
Payment in
lieu
of
notice
Treatment of STI on termination
Resignation
1 - 3 months
1 - 3 months
Unvested awards forfeited
Termination for cause
1 month
1 month
Unvested awards forfeited. Claw back of deferred STI payments at
the Board’s discretion
Termination in cases of disablement,
redundancy or notice without cause
Remuneration Summary
3 months
3 months
Claw back of deferred STI payments at the Board’s discretion
Short term benefits
Post-employment
benefits
Share-
based
payments
Termination
payments
Total
Percentage of
share-based
payments
Salaries,
fees and
leave
$
2018
Executive Directors
James Chirnside
180,000
Non-executive Directors
Current
D Clarke
Luke Robinson
Russell Simpson
9,100
30,000
-
30,000
Key Management Personnel
Dean G Turnbull
146,328
395,428
Cash
bonus
Non-
monetary
benefits
Superannuation
Options/
Incentive
rights
$
-
-
-
-
-
-
$
-
-
-
-
-
-
$
17,100
-
2,850
2,850
11,428
34,228
$
-
-
-
-
-
-
$
$
%
-
197,100
0.00%
-
-
-
-
-
9,100
32,850
32,850
157,756
429,656
0.00%
0.00%
0.00%
0.00%
0.00%
8
Director’s Report
Short term benefits
Post-employment
benefits
Salaries,
fees and
leave
$
2017
Executive Directors
James Chirnside
178,750
Non-executive Directors
Current
Luke Robinson
Russell Simpson
30,000
-
30,000
Key Management Personnel
Dean G Turnbull
134,579
373,329
Cash
bonus
$
-
-
-
-
-
Non-
monetary
benefits
$
Superannuation
$
-
16,981
-
-
-
-
2,850
2,850
12,785
35,466
Share-
based
payments
Options/
Incentive
rights
$
-
-
-
-
-
Termination
payments
Total
Percentage of
share-based
payments
$
$
%
-
195,731
0.00%
-
-
-
-
32,850
32,850
147,364
408,795
0.00%
0.00%
0.00%
0.00%
Bonuses
No cash bonuses were granted to Executive Directors during the financial year ended 30 June 2018 (2017: $nil).
Employee options
At the end of the financial year, there were no share-based payment arrangements in existence.
The following table summarises the value of remuneration options and incentive rights granted, exercised or lapsed during the year:
S Dunn
J Nethersole
N Purden
D G Turnbull
Value of incentive rights
granted
Value of options
exercised
Value of options
cancelled
Value of options lapsed
at lapse date
$
-
-
-
-
$
-
-
-
-
$
-
-
-
-
$
3,840
1,850
3,470
1,850
9
Directors’ Declaration
This directors’ report is signed in accordance with a resolution of directors made pursuant to s.298(2) of the Corporations Act 2001.
_____________________
James Chirnside
Chairman
_____________________
Luke Robinson
Director
_____________________ _____________________
Dennis Clarke
Director
Melbourne
27 September 2018
Russell Simpson
Director
10
Corporate Governance Statement
The Board of Directors of Dart Mining NL (the Company) is responsible for establishing the corporate governance framework of the Group having regard to the
ASX Corporate Governance Council (CGC) published guidelines as well as its corporate governance principles and recommendations. The Board guides and
monitors the business and affairs of the Company on behalf of the shareholders by whom they are elected and to whom they are accountable.
The Company’s corporate governance statement for 2018 is located on the Company’s website at www.dartmining.com.au – about us – Corporate Policy.
11
UNDER SECTION 307C OF THE CORPORATIONS ACT 2001
TO THE DIRECTORS OF DART MINING NL
CE DECLARATION
I declare that, to the best of my knowledge and belief, during the year ended 30 June 2018 there have been:
(i)
no contraventions of the auditor independence requirements as set out in the Corporations Act 2001 in
relation to the audit; and
(ii)
no contraventions of any applicable code of professional conduct in relation to the audit.
MORROWS AUDIT PTY LTD
IAN L. JENKINS
Director
Melbourne:
27 September 2018
Consolidated Statement of Profit or Loss and Other
Comprehensive Income
For the financial year ended 30 June 2018
Continuing operations
Revenue
Consultancy fees
Professional fees
Employee benefits expense
Exploration costs written-off
Depreciation and amortisation expense
Litigation expense
Office expenses
Finance expenses
Administrative expenses
Travel related expenses
Expenses
Profit/(loss) before income tax expense
Income tax expense
Profit/(loss) for the year
Other comprehensive income
Items that will not be reclassified to profit or loss
Items that may be reclassified subsequently to profit or loss
Other comprehensive income for the year
Total comprehensive income for the year
Attributable to:
Net profit/(loss) attributable to
Members of the parent entity
Non-controlling interests
Total comprehensive income
Earnings per share
From continuing and discontinued operations
Basic earnings per share (cents)
Diluted earnings per share (cents)
The accompanying notes form part of these financial statements
Consolidated Group
2018
$
2017
$
2,680
(57,646)
(177,539)
(175,636)
(1,653,711)
(13,799)
(85,899)
(76,708)
(2,531)
(179,781)
(33,095)
(2,456,345)
(2,453,665)
-
(2,453,665)
15,561
(66,097)
(148,796)
(184,453)
(67,316)
(17,272)
-
(53,019)
(2,086)
(167,253)
(24,662)
(730,954)
(715,393)
(1,060,846)
-
(715,393)
-
-
-
-
-
-
(2,453,665)
(715,393)
(2,453,665)
(715,393)
-
-
(2,453,665)
(715,393)
(0.44)
(0.35)
(0.21)
(0.21)
Note
4
5
6
9
9
13
Consolidated Statement of Financial Position
As at 30 June 2018
Consolidated
30 June 2018
Note
$
30 June 2017
$
ASSETS
Current assets
Cash and cash equivalents
Trade and other receivables
Other assets
Total current assets
Non-current assets
Property, plant and equipment
Other non-current assets
Deferred exploration and evaluation costs
Total non-current assets
TOTAL ASSETS
LIABILITIES
Current liabilities
Trade and other payables
Provisions
Total current liabilities
TOTAL LIABILITIES
NET ASSETS
EQUITY
Issued capital
Reserves
Retained earnings
TOTAL EQUITY
The accompanying notes form part of these financial statements
10
11
15
13
15
14
16
17
18
27
675,461
22,603
10,205
708,269
74,110
80,866
7,571,747
7,726,723
8,434,992
272,810
67,949
340,759
340,759
8,094,233
21,841,904
-
(13,747,671)
8,094,233
218,722
8,916
24,000
251,638
62,555
239,214
8,266,729
8,568,498
8,820,136
95,245
84,803
180,048
180,048
8,640,088
19,934,094
11,010
(11,305,016)
8,640,088
14
Consolidated Statement of Changes in Equity
For the financial year ended 30 June 2018
Consolidated
Balance at 1 July 2016
Comprehensive income
Profit/(loss) for the year
Other comprehensive income for the year
Total comprehensive income for the year
Transactions with owners, in their capacity as
owners, and other transfers
Options and performance rights issued
Fair value of lapsed options transferred
Shares issued during the year
Capital raising costs
Total transactions with owners and other
transfers
Balance at 30 June 2017
Balance at 1 July 2017
Comprehensive income
Profit/(loss) for the year
Other comprehensive income for the year
Total comprehensive income for the year
Transactions with owners, in their capacity as
owners, and other transfers
Options and performance rights issued
Fair value of lapsed options transferred
Shares issued during the year
Capital raising costs
Total transactions with owners and other
transfers
Balance at 30 June 2018
The accompanying notes form part of these financial statements
Ordinary share
capital
Option reserve
Accumulated
losses
$
$
$
Total
$
18,925,999
193,060
(10,771,673)
8,347,386
-
-
-
-
-
1,059,664
(51,569)
1,008,095
-
19,934,094
-
-
-
-
(182,050)
-
-
-
(715,393)
(715,393)
-
-
(715,393)
(715,393)
-
182,050
-
-
-
-
-
1,059,664
(51,569)
1,008,095
11,010
(11,305,016)
8,640,088
19,934,094
11,010
(11,305,016)
8,640,088
-
-
-
-
2,077,484
(169,674)
1,907,810
21,841,904
-
-
-
-
(11,010)
-
-
-
-
(2,453,665)
(2,453,665)
-
-
(2,453,665)
(2,453,665)
-
11,010
-
-
-
-
-
2,077,484
(169,674)
1,907,810
(13,747,671)
8,094,233
15
Consolidated Statement of Cash Flows
For the year ended 30 June 2018
Note
Consolidated
2018
$
2017
$
Cash flows from operating activities
Research and development grant received
Interest received
Interest paid
Payments to suppliers and employees
Net cash provided by/(used in) operating activities
22a
Cash flows from investing activities
Payments for exploration costs
Purchase of investments
Disposal/(purchases) of property, plant and equipment
Security deposits refunded (held)
Net cash provided by/(used) in investing activities
Cash flows from financing activities
Proceeds from issue of ordinary shares
Payment of share issue costs
Net cash provided by/(used in) financing activities
Net increase/(decrease) in cash held
Cash and cash equivalent at the beginning of the financial year
Cash and cash equivalent at the end of the financial year
10
The accompanying notes form part of these financial statements
-
2,455
(742)
(697,743)
(696,030)
(507,557)
-
(45,816)
(18,000)
(571,373)
1,833,816
(109,674)
1,724,142
456,739
218,722
675,461
13,097
2,512
-
(854,810)
(839,201)
(371,315)
(3,608)
(11,847)
-
(386,770)
1,059,664
(51,569)
1,008,095
(217,876)
436,598
218,722
16
Notes to the Consolidated Financial Statements
For the financial year ended 30 June 2018
Note 1 Corporate information
The consolidated financial statements of Dart Mining NL and its subsidiaries (collectively, the Group) for the year ended 30 June 2018 were authorised for issue
in accordance with a resolution of the Directors on 27 September 2018.
Dart Mining NL (the Company or the parent) is a for profit company limited by shares incorporated in Australia whose shares are publicly traded on the Australian
Stock Exchange.
Note 2 Summary of significant accounting policies
Basis of preparation
These financial statements are general-purpose financial statements which have been prepared in accordance with the Australian Accounting Standards,
Australian Accounting Interpretations, other authoritative pronouncements of the Australian Accounting Standards Board and the Corporations Act 2001
Australian Accounting Standards set out accounting policies that the Australian Accounting Standards Board has concluded would result in financial statements
containing relevant and reliable information
about transactions, events and conditions. Compliance with Australian Accounting Standards ensures that the financial statements and
notes also comply with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board. Material accounting
policies adopted in the preparation of the financial statements are presented below and have been consistently applied unless stated otherwise.
Except for cash flow information, the financial statements have been prepared on an accrual basis and are based on historical costs, modified where applicable
by the measurement at fair value of selected non-current assets, financial assets and financial liabilities.
(a) Principles of consolidation
The consolidated financial statements incorporate the assets, liabilities and results of entities controlled by Dart Mining NL at the end of the reporting period.
A controlled entity is any entity over which Dart Mining NL has the ability and right to govern the financial and operating policies so as to obtain benefits from
the entity’s activities.
The result of subsidiaries acquired or disposed of during the year are included in the consolidated statement of comprehensive income from the effective date
of acquisition or up to the effective date of disposal, as appropriate. A list of controlled entities is contained in Note 12 to the financial statements.
In preparing the consolidated financial statements, all intra-group balances and transactions between entities in the consolidated group have been eliminated in
full.
(b) Income tax
The income tax expense (income) for the year comprises current income tax expense (income) and deferred tax expense/ (income).
Current income tax expense charged to profit or loss is the tax payable on taxable income. (Current tax liabilities)/assets are measured at the amounts expected
to be paid to/ (recovered from) the relevant taxation authority.
Deferred income tax expense reflects movements in deferred tax assets and deferred tax liability balances during the year and unused tax losses.
The nature of the operations and principal activities of the Group are described in the Directors’ Report. Information on the Group’s structure is provided in
Note 12. Information on other related party relationships is provided in Note 25.
Current and deferred income tax expense/ (income) is charged or credited outside profit or loss when the tax relates to items that are recognised outside profit
or loss.
Except for business combinations, no deferred income tax is recognised from the initial recognition of an asset or liability, where there is no effect on accounting
or taxable profit or loss.
Deferred tax assets and liabilities are calculated at the tax rates that are expected to apply to the period when the asset is realised or the liability is settled. Their
measurement also reflects the manner in which management expects to recover or settle the carrying amount of the related asset or liability. With respect to
non-depreciable items of property, plant and equipment measured at fair value and items of investment property measured at fair value, the related deferred tax
liability or deferred tax asset is measured on the basis that the carrying amount of the asset will be recovered entirely through sale.
Deferred tax assets relating to temporary differences and unused tax losses are recognised only to the extent that it is probable that future taxable profit will be
available against which the benefits of the deferred tax asset can be utilised.
Where temporary differences exist in relation to investments in subsidiaries, branches, associates and joint ventures, deferred tax assets and liabilities are not
recognised where the timing of the reversal of the temporary difference can be controlled and it is not probable that the reversal will occur in the foreseeable
future.
Current tax assets and liabilities are offset where a legally enforceable right of set-off exists and it is intended that net settlement or simultaneous realisation
and settlement of the respective asset and liability will occur. Deferred tax assets and liabilities are offset where : (a) a legally enforceable right of offset exists;
and (b) the deferred tax assets and liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable
entities where it is intended that net settlement or simultaneous realisation and settlement of the respective asset and liability will occur in future periods in
which significant amounts of deferred tax assets or liabilities are expected to be recovered or settled.
17
Notes to the Consolidated Financial Statements
For the financial year ended 30 June 2018
(c) Property, plant and equipment
i)
Items of property, plant and equipment are initially recorded at cost net of GST and depreciated as outlined below.
Acquisition
ii) Depreciation of property, plant and equipment
Property, plant and equipment are depreciated on a straight-line basis at rates based upon the expected useful lives of these assets. The useful lives of
these assets are detailed in Note 13 to the financial statements.
iii) Disposal
The gain or loss arising on disposal or retirement of property, plant or equipment is determined as the difference between the sales proceeds and the
carrying amount of the asset and is recognised in profit and loss.
iv) Subsequent measurement
Property, plant and equipment are subsequently measured at amortised cost. Amortised cost is calculated as the amount at which the asset is measured
at initial recognition less any depreciation or impairment.
(d) Deferred exploration and evaluation
In accordance with AASB 6 Exploration for and Evaluation of Mineral Resources, exploration and evaluation expenditure incurred is accumulated in respect
of each identifiable area of interest. Other than Research and Development costs (see Note 2 (e)) these costs are only carried forward to the extent that they are
expected to be recouped through the successful development of the area or where activities in the area have not yet reached a stage which permits reasonable
assessment of the existence of economically recoverable reserves.
Accumulated costs in relation to an abandoned area are written off in full against operating results in the year in which the decision to abandon the area is made.
When production commences, the accumulated costs for the relevant area of interest are amortised over the life of the area according to the rate of depletion of
the economically recoverable reserves.
A regular review is undertaken of each area of interest to determine the appropriateness of continuing to carry forward costs in relation to that area of interest.
Costs of site restoration are provided over the life of the facility from when exploration commences and are included in the costs of that stage. Site restoration
costs include the dismantling and removal of mining plant, equipment and building structures, waste removal and rehabilitation of the site in accordance with
the clauses of the mining permits. Such costs are determined using estimates of future costs, current legal requirements and technology on an undiscounted
basis.
Any changes in the estimates for the costs are accounted for on a prospective basis. In determining the costs of site restoration there is uncertainty regarding
the nature and extent of the restoration due to community expectations and future legislation. Accordingly, the costs are determined on the basis that restoration
will be completed within one year of abandoning a site.
(e) Research and development costs
Research costs relating to the development of exploration models are expensed as incurred.
(f) Financial instruments
Initial recognition and measurement
Financial assets and financial liabilities are recognised when the entity becomes a party to the contractual provisions to the instrument. For financial assets, this
is equivalent to the date that the Group commits itself to either the purchase or sale of the asset (i.e. trade date accounting is adopted).
Financial instruments are initially measured at fair value plus transaction costs except where the instrument is classified at fair value through profit or loss in
which case transaction costs are expensed to profit or loss immediately.
Classification and subsequent measurement
Financial instruments are subsequently measured at fair value, amortised cost using either the effective interest method or cost Amortised cost is
calculated as the amount at which the financial assets or financial liability is measured at initial recognition less principal repayments, any reduction
for impairment and adjusted for any cumulative amortisation of the difference between that initial amount and the maturity amount calculated using
the effective interest method.
Fair value is determined based on current bid prices for all quoted investments. Valuation techniques are applied to determine the fair value for all
unlisted securities, including recent arm’s length transactions, by reference to similar instruments and option pricing models.
The effective interest method is used to allocate interest income or interest expense over the relevant period and is equivalent to the rate that discounts
estimated future cash payments or receipts (including fees, transaction costs and other premiums or discounts) over the expected life (or when this
cannot be reliably predicted, the contractual term) of the financial instrument to the net carrying amount of the financial asset or financial liability.
Revisions to expected future net cash flows will necessitate an adjustment to the carrying amount with a consequential recognition of an income or
expense item in profit or loss.
The Group does not designate any interests in subsidiaries, associates or joint venture entities as being subject to the requirements of accounting
standards specifically applicable to financial instruments.
18
Notes to the Consolidated Financial Statements
For the financial year ended 30 June 2018
(i) Loans and receivables
fixed or determinable payments that are not quoted in an active market and are
Loans and receivables are non-derivative financial assets with
subsequently measured at amortised cost. Gains or losses are recognised in profit or loss through the amortisation process and when the financial
asset is de- recognised.
(ii) Held-to-maturity investments
Held-to-maturity investments are non-derivative financial assets that have fixed maturities and fixed or determinable payments, and it is the Group’s
intention to hold these investments to maturity. They are subsequently measured at amortised cost. Gains or losses are recognised in profit or loss
through the amortisation process and when the financial asset is de-recognised.
Financial liabilities
(iii)
Non-derivative financial liabilities other than financial guarantees are subsequently measured at amortised cost. Gains or
losses are recognised in profit or loss through the amortisation process and when the financial asset is de-recognised.
Impairment
At the end of each reporting period the Group assesses whether there is objective evidence that a financial asset has been impaired. A financial asset (or a
group of financial assets) is deemed to be impaired if, and only if, there is objective evidence of impairment as a result of one or more events (a “loss event”)
having occurred, which has an impact on the estimated future cash flows of the financial asset(s).
In the case of available-for-sale financial assets, a significant or prolonged decline in the market value of the instrument is considered to constitute a loss event.
Impairment losses are recognised in profit or loss immediately. Also, any cumulative decline in fair value previously recognised in other comprehensive
income is reclassified to profit or loss at this point.
In the case of financial assets carried at amortised cost, loss events may include: indications that the debtors or a group of debtors are experiencing significant
financial difficulty, default or delinquency in interest or principal payments; indications that they will enter bankruptcy or other financial reorganisation; and
changes in arrears or economic conditions that correlate with defaults.
For financial assets carried at amortised cost (including loans and receivables), a separate allowance account is used to reduce the carrying amount of financial
assets impaired by credit losses. After having taken all possible measures of recovery, if management establishes that the carrying amount cannot be recovered
by any means, at that point the written-off amounts are charged to the allowance account or the carrying amount of impaired financial assets is reduced directly
if no impairment amount was previously recognised in the allowance account.
When the terms of financial assets that would otherwise have been past due or impaired have been renegotiated, the Group recognises the impairment for such
financial assets by taking into account the original terms as if the terms have not been renegotiated so that the loss events that have occurred are duly considered.
De-recognition
Financial assets are de-recognised when the contractual rights to receipt of cash flows expire or the asset is transferred to another party whereby the entity no
longer has any significant continuing involvement in the risks and benefits associated with the asset. Financial liabilities are de-recognised when the related
obligations are discharged, cancelled or have expired. The difference between the carrying amount of the financial liability extinguished or transferred to
another party and the fair value of consideration paid, including the transfer of non-cash assets or liabilities assumed, is recognised in the statement of
comprehensive income or profit or loss.
(g) Impairment of assets
At the end of each reporting period, the Group assesses whether there is any indication that an asset may be impaired. The assessment will include the
consideration of external and internal sources of information including dividends received from subsidiaries, associates or jointly controlled entities deemed
to be out of pre-acquisition profits. If such an indication exists, an impairment test is carried out on the asset by comparing the recoverable amount of the
asset, being the higher of the asset’s fair value less costs to sell and value in use, to the asset’s carrying amount. Any excess of the asset’s carrying amount
over its recoverable amount is recognised immediately in profit or loss, unless the asset is carried at a revalued amount in accordance with another Standard
(e.g. in accordance with the revaluation model in AASB 116: Property, Plant and Equipment). Any impairment loss of a revalued asset is treated as a
revaluation decrease in accordance with that other Standard.
Where it is not possible to estimate the recoverable amount of an individual asset, the Group estimates the recoverable amount of the cash-generating unit to
which the asset belongs.
Impairment testing is performed annually for goodwill, intangible assets with indefinite lives and intangible assets not yet available for use.
(h) Leases
Leases are classified at their inception as either operating or finance leases based on the economic substance of the agreement so as to reflect the risks and
benefits incidental to ownership.
Operating Leases
The minimum lease payments of operating leases, where the lesser effectively retains substantially all of the risks and benefits of ownership of the leased item,
are recognised as an expense on a straight line basis. Contingent rentals are recognised as an expense in the financial year in which they are incurred.
Finance Leases
Leases which effectively transfer substantially the entire risks and benefits incidental to ownership of the leased item to the Group are capitalised at the present
value of the minimum lease payments and disclosed as property, plant and equipment under lease. A lease liability of equal value is also recognised. The
consolidated entity has no finance leases as at 30 June 2018.
19
Notes to the Consolidated Financial Statements
For the financial year ended 30 June 2018
(i) Employee benefits
Provision is made for the Group’s liability for employee benefits arising from services rendered by employees to the end of the reporting period. Employee
benefits that are expected to be settled within one year have been measured at the amounts expected to be paid when the liability is settled.
Employee benefits payable later than one year have been measured at the present value of the estimated future cash outflows to be made for those benefits. In
determining the liability, consideration is given to employee wage increases and the probability that the employee may satisfy any vesting requirements. These
cash flows are discounted using market yields on national government bonds with terms to maturity that match the expected timing of cash flows attributable
to employee benefits.
(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.
(k) Cash and cash equivalents
Cash and cash equivalents include deposits available on demand with banks.
(l) Issued capital
Issued and paid up capital is recognised at the fair value of the consideration received by the Company.
Transaction costs arising on the issue of equity instruments are recognised directly in equity as a reduction of the proceeds of the equity instrument to which
the costs relate. Transaction costs are costs that are incurred directly in connection with the issue of those equity instruments and which would not have been
incurred had those instruments not been issued.
(m) Share-based payments
The Group measures the cost of equity-settled transactions with employees and consultants by reference to the fair value of the equity instruments at the date at
which they are granted. The fair value is determined by using the Black-Scholes model, using the assumptions detailed in Note 23.
The fair value determined at the grant date of the equity settled share based payment is expensed on a straight-line basis over the vesting period, based on
(i)
the directors’ estimate of shares that will eventually vest.
(ii) Equity-settled share based payment transactions with other parties are measured at the fair value of the goods and services received, except where the fair
value cannot be estimated reliably, in which these are measured at the fair value of the equity instruments granted at the date the entity obtains the goods or the
counterparty renders the service.
(n) Going concern basis
The Group is involved in the exploration and evaluation of mineral tenements and as such expects to be cash absorbing until these tenements demonstrate that
they contain economically recoverable reserves.
As at 30 June 2018, the Group had a surplus of current assets over current liabilities of $367,510 (2017: $71,590) including cash reserves of $675,4612 (2017:
$218,722).
For the year ended 30 June 2018, the Group reported net cash outflows from operations and investing activities of $696,030 (2017: $839,201) and $571,373
(2017: $386,770) respectively. These cash outflows were offset by net cash inflows from financing activities of $1,724,142 (2017: $1,008,095) resulting in
total cash inflows/ (outflows) for the year of $456,739 (2017: (($217,876)).
As noted in the June 2017 Annual Financial Report, Dart Mining NL received a notification from Innovation Australia [formerly Auslndustry) stating that the
previous R&D Claims did not contain core or supporting R&D activities in accordance with the Industry Research and Development Act 1986.
Submissions have been made and the matter has been finalized. For the 2011/12 year which was the main focus of dispute, the most significant aspects of the
claim were allowed. However, work on two smaller activities was not allowed. Following extensive accounting investigation, the total amount which is
potentially refundable to Innovation Australia for the 2011/12 year is less than $25,000. The issue is still in the process of being resolved. As a conservative
measure, the Company has recorded an accrual of $30,000 owing to AusIndustry within sundry payables.
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 settlement of liabilities in the ordinary course of business.
The ability of the Group to continue as a going concern for the twelve months from the date of this report is dependent on its ability to control its overhead
costs and exploration expenditures and to generate additional funds from activities including:
other future equity or debt fund raisings;
the potential farm-out of participating interests in the Group’s tenements; and
successful development of existing tenements.
Having carefully assessed the likelihood of securing additional funding or entering into farm-out arrangements including the funds raised subsequent to the
balance date and the Group’s ability to effectively manage their expenditures and cash flows from operations, the directors believe that the Group will continue
to operate as a going concern for the foreseeable future and therefore it is appropriate to prepare the financial statements on a going concern basis.
20
Notes to the Consolidated Financial Statements
For the financial year ended 30 June 2018
(o) Revenue and other income
Revenue is measured at the fair value of the consideration received or receivable after taking into account any trade discounts and volume rebates allowed.
When the inflow of consideration is deferred it is treated as the provision of financing and is discounted at a rate of interest that is generally accepted in the
market for similar arrangements. The difference between the amount initially recognised and the amount ultimately received is interest revenue.
Interest revenue is recognised using the effective interest method.
All revenue is stated net of the amount of goods and services tax.
(p) Trade and other receivables
Trade and other receivables include amounts due from customers for goods
sold and services performed in the ordinary course of business. Receivables expected to be collected within 12 months of the end of the reporting period are
classified as current assets. All other receivables are classified as non-current assets.
Trade and other receivables are initially recognised at fair value and subsequently measured at amortised cost using the effective interest method, less any
provision for impairment. Refer to Note 2(f) for further discussion on the determination of impairment losses.
(q) Trade and other payables
Trade and other payables represent the liabilities for goods and services received by the entity that remain unpaid at the end of the reporting period. The balance
is recognised as a current liability with the amounts normally paid within 30 days of recognition of the liability.
Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of GST recoverable from, or payable to, the ATO
is included with other receivables or payables in the statement of financial position.
(r) Goods and services tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from the Australian
Taxation Office (ATO).
Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of GST recoverable from, or payable to, the ATO
is included with other receivables or payables in the statement of financial position.
Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities which are recoverable from, or
payable to, the ATO are presented as operating cash flows included in receipts from customers or payments to suppliers.
(s) Government grants
Government grants are recognised at fair value where there is reasonable assurance that the grant will be received and all grant conditions will be met. Grants
relating to expense items are recognised as income on the date of receipt of the grant. Grants relating to assets are credited to deferred income at fair value and
are credited to income over the expected useful life of the asset on a straight-line basis.
Repayment of Government grants are recognised at fair value where there is a reasonable likelihood that a repayment will be required.
(t) Comparative figures
When required by Accounting Standards, comparative figures have been adjusted to conform to changes in presentation for the current financial year.
Where the Group retrospectively applies an accounting policy, makes a retrospective restatement or reclassifies items in its financial statements, an additional
(third) statement of financial position as at the beginning of the preceding period in addition to the minimum comparative financial statement is presented.
(u) Critical accounting judgements and sources of estimations
In applying the Group’s accounting policies, management is required to make judgements, estimates and assumptions about the carrying values of assets and
liabilities. These estimates and assumptions are made based on past experience and other factors that are considered relevant. Actual results may differ from
these estimates. All 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 if the revision affects both current and future periods.
The following describes critical judgements that management has made in the process of applying the Group’s accounting policies and that have the most
significant effect on the amounts recognised in the financial statements:
Impairment of deferred exploration costs
The Group’s accounting policy for exploration expenditure results in some items being capitalised for an area of interest where it is considered likely to be
recoverable in the future or where the activities have not reached a stage which permits a reasonable assessment of the existence of reserves. Management is
required to make certain estimates and assumptions as to future events and circumstances which may change as new information becomes available. If a
judgement is made that recovery of a capitalised expenditure is unlikely, the relevant amount will be written off to the income statement.
21
Notes to the Consolidated Financial Statements
For the financial year ended 30 June 2018
(v) New Accounting Standards for Application in Future Periods
Accounting Standards issued by the AASB that are not yet mandatorily applicable to the Group, together with an assessment of the potential impact of such
pronouncements on the Group when adopted in future periods, are discussed below:
-
AASB 9: Financial Instruments and associated Amending Standards (applicable to annual reporting periods beginning on or after 1 July 2018).
The Standard will be applicable retrospectively (subject to the provisions on hedge accounting outlined below) and includes revised requirements for the
classification and measurement of financial instruments, revised recognition and derecognition requirements for financial instruments and simplified
requirements for hedge accounting.
The key changes that may affect the Group on initial application include certain simplifications to the classification of financial assets, simplifications to
the accounting of embedded derivatives, upfront accounting for expected credit loss, and the irrevocable election to recognize gains and losses on
investments in equity instruments that are not held for trading in other comprehensive income. AASB 9 also introduces a new model for hedge accounting
that will allow greater flexibility in the ability to hedge risk, particularly with respect to hedges of non-financial items, Should the entity elect to change
its hedge policies in line with the new hedge accounting requirements of the Standard, the application of such accounting would be largely prospective.
Although the directors anticipate that the adoption of AASB 9 may have an impact on the Group’s financial instruments, including hedging activity, it is
impracticable at this stage to provide a reasonable estimate of such impact.
-
AASB 16: Leases (applicable to annual reporting periods beginning on or after 1 July 2019)
When effective, this Standard will replace the current accounting requirements applicable to leases in AASB 117: Leases and related Interpretations.
AASB 16 introduces a single accounting model that eliminates the requirement for leases to be classified as operating or finance leases.
The main changes introduced by the new Standard are as follows:
-
-
-
-
-
-
recognition of a right-of-use asset and liability for all leases (excluding short-term leases with less than 12 months of tenure and leases relating
to low-value assets);
depreciation of right-of-use assets in line with AASB 116:
Property, Plant and Equipment in profit or loss and unwinding of the liability in principal and interest components;
inclusion of variable lease payments that depend on an index or a rate in the initial measurement of the lease liability using the index or rate at
the commencement date;
application of a practical expedient to permit a lessee to elect not to separate non-lease components and insteadaccount for all components as a
lease; and
inclusion of additional disclosure requirements.
The transitional provisions of AASB 16 allow a lessee to either retrospectively apply the Standard to comparatives in line with AASB or recognize the
cumulative effect of retrospective application as an adjustment to opening equity on the date of initial application.
Although the directors anticipate that the adoption of AASB 16 will impact the Group’s financial statements, it is impracticable at this stage to provide a
reasonable estimate of such impact.
22
Notes to the Consolidated Financial Statements
For the financial year ended 30 June 2018
Note 3 Parent information
Statement of Financial Position
Assets
Current assets
Non-current assets*
Total assets
Liabilities
Current liabilities
Non-current liabilities
Total liabilities
Net assets
Equity
Issued capital
Reserves
Retained earnings
Total equity
Statement of Profit or Loss and Other Comprehensive Income
Total profit/(loss)*
Total comprehensive income/(loss)
Consolidated
2018
$
2017
$
786,812
880,851
251,633
8,582,459
1,667,663
8,834,092
327,458
-
327,458
1,340,205
180,244
-
180,244
8,653,848
21,841,904
-
19,934,094
33,070
(20,501,699)
(11,313,316)
1,340,205
8,653,848
(9,221,453)
(9,221,453)
(715,393)
(715,393)
*The decrease in non-current assets is mainly due to the transfer of several tenement licenses from Dart Mining NL (the parent entity) to its wholly
owned subsidiary Mount Unicorn Holdings Pty Ltd (MUH) in the current financial year. The capitalized exploration expenses at the point of transfer
was approximately $7million. Upon transfer of the costs to MUH, the parent entity recognized a loan owing from MUH and subsequently impaired
the loan in full resulting in significant losses for the parent entity in the current year. This loan impairment has no impact on the consolidated loss
for the Group.
Note 4 Revenue and other income
Revenue from continuing operations
Sales revenue
– Research and development grant
Other revenue
– Interest received
– Other revenue
-
-
2,680
-
2,680
2,680
-
-
2,464
13,097
15,561
15,561
23
Notes to the Consolidated Financial Statements
For the financial year ended 30 June 2018
Note 5 Profit/(loss) for the year
Profit/(loss) before income tax from operations include the following expenses
Exploration expenses written off
Depreciation
Note 6 Tax expense
(a) The prima facie tax on profit from ordinary activities before income tax is reconciled to the
income tax expense
Profit/(loss) from continuing operations
Income tax expense (benefit) calculated at 27.5% (2017: 27.5%)
Effect of non-deductible expenses
Effect of deductible temporary differences
Effect of unused tax losses and tax offsets not recognised as deferred tax assets
Utilisation of tax losses brought forward
Income tax expense
(b) Tax losses not brought to account
Tax losses brought forward
Current year tax losses
Effect of change in tax rate from 30% to 27.5%
Utilisation of tax losses brought forward
Recognition of tax losses – correction prior years
Tax losses carried forward
Consolidated
2018
$
2017
$
1,653,711
13,799
67,316
17,272
(2,453,665)
(674,758)
487,000
(312,825)
500,583
-
-
4,282,975
500,583
-
-
9,466
4,793,024
(715,393)
(196,733)
49,343
(147,196)
294,586
-
-
4,312,491
294,586
(362,581)
-
38,479
4,282,975
24
Notes to the Consolidated Financial Statements
For the financial year ended 30 June 2018
Note 7 Key management personnel compensation
Total remunerations paid to KMP of the Company and the Group during the year are as follows :
Short-term employee benefits
Post-employment benefits
Share-based payments
Long-term employee benefits
Termination payments
Total KMP compensation
Consolidated
2018
$
2017
$
395,428
34,228
-
-
-
373,329
35,466
-
-
-
429,656
408,795
KMP options and rights holdings
There were no options issued to KMP of the group during the financial year as an incentive or as compensation (2017: Nil)
The number of options and incentive rights over ordinary shares held during the financial year by each KMP of the Group is as follows:
Balance at
beginning of year
Incentive rights
granted as
r e muneration during
the year
Unlisted Incentive
rights exercised,
lapsed or excluded
during the year
Net other
changes1
Balance at
end of year
2018
D G Turnbull
2017
D G Turnbull*
250,000
250,000
2,250,000
2,250,000
-
-
-
-
(250,000)
(250,000)
-
-
-
-
(2,000,000)
(2,000,000)
-
-
250,000
250,000
*D G Turnbull resigned from the Company in April 2018 but continues to hold shares in the Company.
Note 8 Auditor’s remuneration
Amounts received or due and receivable by Morrows Audit Pty Ltd (previous year MSI Ragg Weir) for:
Audit or review of the financial statements of the Group
27,450
27,850
Consolidated
2018
$
2017
$
25
Notes to the consolidated financial statements
For the financial year ended 30 June 2018
Note 9 Earnings per share
(a) Reconciliation of earnings to profit and loss
Net profit/(loss) for the year
Earnings/(loss) used to calculate basic EPS
(b) Weighted average number of ordinary shares outstanding during the year used in the calculation of
basic EPS
Basic earnings per share
Diluted earnings per share
Consolidated
2018
$
2017
$
(2,453,665)
(2,453,665)
564,484,753
(0.44)
(0.35)
(715,393)
(715,393)
344,855,03
2
(0.21)
(0.21)
Diluted earnings per share is calculated after classifying all options on issue remaining unconverted at 30 June 2018 as potential ordinary shares. At 30
June 2018, the Company had on issue 295,087,533 (2017: 1,250,000) options and incentive rights over unissued capital and had incurred a net loss. Unlisted
options are not considered dilutive and have not been included in the calculations of diluted earnings per share.
Note 10 Cash and cash equivalent
Cash at bank and on hand
Note 11 Trade and other receivables
Accrued interest – other persons/corporations
GST receivable
675,461
675,461
218,722
218,722
251
22,352
22,603
295
8,621
8,916
No receivable amounts were past due or impaired at 30 June 2018 (2017: Nil)
Credit risk
The Group has no significant concentration of credit risk with respect to any single counter party or group of counter-parties other than those receivables
specifically provided for and mentioned within Note 11. The class of assets described as Trade and Other Receivables is considered to be the main source of
credit risk related to the Group.
Note 12 Controlled entities
Dart Resources Pty Ltd
Mt Unicorn Holdings Pty Ltd
Mt View Holdings Pty Ltd
Country of
incorporation
Australia
Australia
Australia
Percentage owned (%)
2018
100%
100%
100%
2017
100%
100%
100%
For each of the controlled entities that the place of business is the same as the place of incorporation. The activities of these entities are not material to the
Group.
There are no significant restrictions on the Group’s or its controlled entities ability to access or use the assets and settle the liabilities of the Group nor are
there restrictions on ownership changes to these entities.
26
Notes to the consolidated financial statements
For the financial year ended 30 June 2018
Note 13 Property, plant and equipment
Plant and equipment
At cost
Accumulated depreciation
Computer equipment & software
At cost
Accumulated depreciation
Motor vehicles
At cost
Accumulated depreciation
Total property, plant and equipment
Plant & equipment
Consolidated
Balance at 1 July 2016
Additions
Depreciation expense
Depreciation expense capitalised as deferred exploration
expenditure
Balance at 30 June 2017
Balance at 1 July 2017
Additions/(Disposals)
Depreciation expense
Depreciation expense capitalised as deferred exploration
expenditure
Balance at 30 June 2018
The following useful lives are used in the calculation of depreciation:
Plant and equipment
Computer equipment & software
Motor vehicles
$
5,070
4,072
(868)
(1,171)
7,103
7,103
963
(1,620)
(968)
5,478
3 – 6 years
3 – 4 years
4 – 5 years
Consolidated
2018
$
2017
$
106,213
(100,735)
5,478
72,488
(62,069)
10,419
172,139
(113,926)
58,213
74,110
105,249
(98,146)
7,103
67,431
(50,775)
16,656
126,309
(87,513)
38,796
62,555
Motor vehicles
Total
$
60,867
-
(7,357)
(14,714)
38,796
45,832
(3,709)
(22,706)
$
88,017
10,711
(17,272)
(18,901)
62,555
62,555
51,851
(13,799)
(26,497)
58,213
74,110
27
Computer
equipment &
software
$
22,080
6,639
(9,047)
(3,016)
16,656
5,056
(8,470)
(2,823)
10,419
16,656
38,796
Notes to the consolidated financial statements
For the financial year ended 30 June 2018
Note 14 Deferred exploration and evaluation
Balance at beginning of financial year
Current year expenditure capitalised – mining exploration
Current year expenditure capitalised – joint ventures
Exploration costs written-off
Balance at end of financial year
Comprising:
-
-
Deferred mining exploration expenditure
Deferred joint ventures expenditure
Consolidated
2018
$
8,266,737
958,720
-
(1,653,710)
7,571,747
7,571,747
-
2017
$
7,930,972
282,736
120,337
(67,316)
8,266,729
8,092,486
174,243
Ultimate recovery of deferred exploration and evaluation costs is dependent upon the success of Pre-feasibility Studies, exploration and evaluation or
sale or farm-out of the exploration interests. A percentage of the CEO’s salary and associated costs are capitalised in line with the Company’s policy for
capitalising costs directly relating to pre-feasibility and exploration. Namely, the Company has four cost centres, Corporate, Pre-feasibility, Research and
Development and Exploration. Where identifiable, costs associated with the Pre-feasibility and Exploration cost centres are capitalised. These costs are
annually reviewed for impairment and a charge is made direct to the Income Statement of the Company when an impairment is identified. The Company
still intends to continue activity on the remaining tenements under its control. During the year ended 30 June 2018 the Company surrendered tenement
license MIN5559 and did not renew expired tenement license EL5058. The capitalised exploration costs for these tenements have been written off in
the current financial year.
Note 15 Other assets
CURRENT
Prepayments
NON-CURRENT
Bond security for exploration tenement licences
Bond security for company credit cards
Receivable from joint ventures
Investment in joint ventures
Rental property bonds
Note 16 Trade and other payables
CURRENT
Trade payables
Sundry payables
Terms and conditions relating to the above financial instruments:
Trade creditors are non-interest bearing and are usually settled on 30 day terms.
(i)
(ii) Other creditors are non-interest bearing and have an average term of 30 days.
10,205
10,205
69,042
10,000
-
-
1,824
80,866
24,000
24,000
50,772
10,000
174,243
3,330
3,330-
869
869869-
239,214
90,142
182,668
272,810
15,184
80,061
95,245
28
Notes to the consolidated financial statements
For the financial year ended 30 June 2018
Note 17 Provisions
CURRENT
Short term employee benefits
Note 18 Issued capital
Ordinary shares
Consolidated
67,949
84,803
2018
No
$
2017
No
$
18,925,999
1,059,664
111,461,335
Balance at the beginning of the financial year
411,485,049
19,934,094
300,023,714
Share issue
Shares issued under 1 for 2 Entitlement Offer
Shortfall placement shares issued under 1 for 2 Entitlement offer
Shares issued as consideration for tenements (held in voluntary escrow)
Shares issued as consideration for consultancy fees
Issue of share on exercise of options
Shares issued under 1 for 3 Entitlement Offer
Less transaction costs arising from issue of shares
86,714,432
119,028,200
18,172,965
7,020,644
52,500
89,397,401
-
433,572
595,142
181,730
61,938
525
804,577
(169,674)
-
(51,569)
Balance at end of financial year
731,871,191
21,841,904
411,485,049
19,934,094
Terms and conditions of contributed equity
Ordinary shares have the right to receive dividends as declared and, in the event of 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. Ordinary shares entitle their holder to one vote, either in person or by proxy,
at a meeting of the Company.
The issued capital of the Company quoted on the ASX comprises 731,871,191 ordinary shares (2017: 411,485,049).
Listed options
Options exercisable at $0.01 and expire 28 February 2019.
Consolidated
Balance at the beginning of the financial year
Options issued under 1 for 2 Entitlement Offer with free attaching options
Options issued under Shortfall Placement of 1 for 2 Entitlement offer with free attaching options
Options exercised
Options issued under 1 for 3 Entitlement Offer with free attaching options
Balance at end of financial year
At the end of the financial year, there were no unlisted options on issue (2017: 1,250,000).
The following unlisted options expired during the 2018 financial year.
2018
2017
No
-
86,714,432
119,028,200
(52,500)
89,397,401
295,087,533
No
-
-
-
-
-
-
Securities
Unlisted
Unlisted
Expiry date
Number
Exercise price
(cents)
Expired on
31 December 2017
31 December 2017
850,000
400,000
6
3
31 December 2017
31 December 2017
29
Notes to the consolidated financial statements
For the financial year ended 30 June 2018
The following options expired during the 2017 financial year.
Securities
Unlisted
Unlisted
Unlisted
Unlisted
Unlisted
Unlisted
Expiry date
Number
Exercise price
(cents)
Expired on
20 March 2017
20 March 2017
31 December 2016
30 August 2016
31 December 2016
30 June 2017
100,000
100,000
3,000,000
1,000,000
2,000,000
750,000
18
22
15
11.1
11
6
20 March 2017
20 March 2017
31 December 2016
30 August 2016
31 December 2016
30 June 2017
Note 19 Expenditure commitments
Exploration expenditure
rights
Under the terms of the exploration tenement licences, the Group has a commitment to meet a minimum expenditure requirement in order to keep its
current. The minimum expenditure requirement is not recognised as a liability in the Statement of Financial Position of the Group as the Group may relinquish
its rights to a particular tenement thereby removing the requirement to meet the minimum expenditure requirement.
Not longer than 1 year
Between 1 and 5 years
Longer than 5 years
Operating leases
Consolidated
2018
$
395,844
923,040
-
1,318,884
2017
$
367,033
393,116
-
760,149
The Group has commercial leases on property. These leases have renewal options on the property leases. There are no restrictions upon the lessee by entering
into these leases.
Future minimum lease payments payable under non-cancellable operating leases as at the balance date are as follows:
Not longer than 1 year
Between 1 and 5 years
Licence agreement
15,924
-
15,924
10,644
16,8719
-
10,644
The Group has a licence agreement for exclusive use of an office areas. There are no restrictions upon the lessee by entering into this agreement.
Future minimum payments payable under a non-cancellable agreement as at the balance date are as follows:
Not longer than 1 year
Between 1 and 5 years
-
-
-
24,423
-
24,423
30
Notes to the consolidated financial statements
For the financial year ended 30 June 2018
Note 20 Contingent liabilities and contingent assets
The company establishes an accrued liability for claims when it determines that a loss is probable and the amount of the loss can be reasonably
estimated. Accruals will be adjusted from time to time, as appropriate, in the light of additional information.
As noted in the June 2017 Annual Financial Report, Dart Mining NL received a notification from Innovation Australia [formerly Auslndustry) stating
that the previous R&D Claims did not contain core or supporting R&D activities in accordance with the Industry Research and Development Act 1986.
Submissions have been made and the matter has been finalized. For the 2011/12 year which was the main focus of dispute, the most significant aspects
of the claim were allowed. However, work on two smaller activities was not allowed. Following extensive accounting investigation, the total amount
which is potentially refundable to Innovation Australia for the 2011/12 year is less than $25,000. The issue is still in the process of being resolved. As
a conservative measure, the Company has accrued an amount of $30,000 as a refund owing to AusIndustry within sundry payables in Note 16.
Under tenement licence conditions in Victoria the Group is required to rehabilitate each licence area to its original state subsequent to any exploration work.
Rehabilitation costs are estimated not to exceed $60,000.
The Company and a wholly-owned subsidiary, Dart Resources Pty Ltd, have entered into a deed of cross guarantee under which the Company and its subsidiary
guarantee the debts of each other.
No contingent assets existed at the reporting date.
Note 21 Operating segments
The Group’s activities consist of base metal and gold exploration currently in one geographic region of north-east Victoria. There are no other significant classes
of business, either singularly or in aggregate. Internal monthly management reports are provided to the Group’s Directors that consolidate operations in one
segment. Therefore, the Group’s activities are classed as one business segment and as a result operating and financial information are not separately disclosed in
this note.
Note 22 Cash-flow information
a) Reconciliation of cash flow from operations with profit after income tax
Profit/(loss) after income tax
Non- cash flows in profit/(loss)
Depreciation
Exploration cost written off
Share based payments
Loss on disposal of assets
Changes in assets and liabilities
(Increase)/Decrease in receivables
(Increase)/Decrease in other assets
Increase/(Decrease) in trade payables and accruals
Increase/(Decrease) in provisions
Cash flow from operations
b) Reconciliation of cash
Cash balance comprises:
Cash on hand and at call
Term deposits
Consolidated
2018
$
2017
$
(2,453,665)
(715,393)
13,799
1,653,711
37,000
-
(13,960)
13,795
62,331
(9,041)
(696,030)
675,461
-
675,461
17,272
-
-
1,136
26,202
(24,000)
(151,995)
7,577
(839,201)
218,722
-
218,722
31
Notes to the consolidated financial statements
For the financial year ended 30 June 2018
c)
Financing facility
The Group has no available finance facilities at balance date.
d) Non-cash financing and investing activities
There were no non-cash financing or investing activities during the financial year.
Note 23 Share-based payments
Executive options
There were no share-based options held at the end of the current reporting year. Options are priced using a Black-Scholes model. Where relevant, the expected
life used in the model has been adjusted based on management’s best estimate for the effects of non-transferability, exercise restrictions. Expected volatility is
based on the historical share price volatility of the Company over the reporting period.
Movements in share-based payments options
Balance at beginning of year
Cancelled
Expired
Balance at end of year
Exercisable at end of year
2018
2017
Number Weighted average
exercise price
(cents)
Number Weighted average
exercise price
(cents)
1,250,000
-
(1,250,000)
-
-
8,200,000
(750,000)
(6,200,000)
1,250,000
1,250,000
-
5
Note 24 Events after the reporting period
In July 2018 the Company placed the shortfall of the Entitlement Offer under the prospectus lodged on 30 May 2018. The amount raised under the shortfall
was $1,122,687 bringing the total amount raised under the Entitlements Offer to $1,927,265. 124,743,041 fully paid ordinary shares were issued under the
shortfall placement at $0.009 per share with attaching options exercisable at one cent and expiring 28 February 2019.
No other matters or circumstances have arisen since the end of the financial year that have significantly affected or may have a significant effect on the financial
operations of the Group, the financial performance of those operations or the financial position of the Group in the subsequent financial year.
Note 25 Related party transactions
Key Management Personnel
Any person(s) having authority and responsibility for planning, directing and controlling the activities of the entity, directly or indirectly, including any Director
(executive or otherwise) of the entity are considered Key Management Personnel (refer Note 7).
Other related parties
Other related parties include entities controlled by the ultimate parent entity and entities over which key management personnel have joint control.
Transactions with related parties
Transactions with related parties are on normal commercial terms and conditions no more favourable than those available to other parties unless otherwise
stated.
There were no related party transactions.
32
Notes to the consolidated financial statements
For the financial year ended 30 June 2018
Note 26 Financial risk management
The Group’s financial instruments consist mainly of deposits with banks, receivables and trade and other payables.
The totals of each category of financial instruments, measured in accordance with AASB139 as detailed in the accounting policies to these financial
statements are as follows:
Financial assets
Cash and cash equivalents
Other receivables
Other non-current receivables
Total financial assets
Financial liabilities
Financial liabilities at amortised costs - trade and other payables
Total financial liabilities
Consolidated
2018
$
2017
$
675,461
22,603
-
698,064
272,810
272,810
218,722
8,916
-
227,638
95,245
95,245
Specific financial risk exposures and Management
The main risks the Group is exposed to through its financial instruments are credit risk, liquidity risk and market risk consisting of interest rate risk and foreign
currency risk. There have been no substantive changes in the types of risks the Group is exposed to, how these risks arise, or the Board’s objectives, policies and
processes for managing or measuring the risks from the previous period.
Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Group. The Group has adopted a policy
of only dealing with creditworthy counterparties as a means of mitigating the risk of financial loss from defaults. The Group’s exposure to credit risks are
continuously monitored and controlled by counterparty limits that are reviewed and approved by the management on a regular basis. The Group does not have
any significant credit risk exposure to any single counterparty or any group of counterparties having similar characteristics. The credit risk on liquid funds and
derivative financial instruments is limited as the counterparties are banks with high credit ratings assigned by international credit rating agencies. The carrying
amount of financial assets recorded in the financial statements, net of any allowances
for losses, represent the Group’s maximum exposure to credit risk.
Liquidity risk
Ultimate responsibility for liquidity risk management rests with the Board of Directors, who have built an appropriate liquidity risk management framework
for the management of the Group’s short, medium and long term funding and liquidity management requirements. The Group manages liquidity risk by
maintaining adequate reserves and banking facilities by continuously monitoring forecast and actual cash flows and matching profiles of financial assets and
liabilities.
33
Notes to the Consolidated Financial Statements
For the financial year ended 30 June 2018
The following table details the Group’s remaining contractual maturity for its financial liabilities and financial assets
Within 1 year
1 to 5 years
Over 5 years
Total
2018
2017
2018
2017
2018
2017
2018
2017
Consolidated
Financial liabilities due for
payment
Trade and other payable
Total contractual outflows
Financial assets cash flow realisable
Cash and cash equivalents
Loans and other receivables
272,810
272,810
95,245
95,245
675,461
218,722
-
-
-
-
-
-
-
-
80,866
272,872
Other non-interest bearing receivables
22,603
8,916
Total anticipated inflows
Net (outflow)/inflow on financial
instruments
698,064
227,638
425,254
132,393
-
80,866
80,866
-
272,872
272,872
-
-
-
-
-
-
-
-
-
272,810
272,810
95,245
95,245
-
-
-
-
-
675,461
218,722
80,866
272,872
22,603
8,916
778,930
500,510
506,120
405,265
Market risk
Interest rate risk
The Group’s exposure to market risk primarily consist of financial risks associated with changes in interest rates as detailed below. As the level of risk is low,
the Group does not use any derivatives to hedge its exposure. Market risks are managed through cash flow forecasts and sensitivity analysis on a regular
basis.
The Group is exposed to interest rate risks as it holds funds at both fixed and variable interest rates. The risk is managed through the use of cash
forecasts supplemented by sensitivity analysis.
flow
The Group currently holds no amounts of borrowed funds.
Interest rate sensitivity analysis
A sensitivity analysis has been determined based on the exposure to interest rates at reporting date with the stipulated change taking place at the beginning
of the financial year and held constant throughout the reporting period. A 50-basis point increase or decrease is used when reporting
interest rate risk
internally to key management personnel and represents management’s assessment of the possible change in interest rates.
Year ended 30 June 2018
+/- 0.5% in interest rates
Year ended 30 June 2017
+/- 0.5% in interest rates
Consolidated
Profit
$
3,377
1,094
Equity
$
3,377
1,094
There have been no changes in any methods or assumptions used to prepare the above analysis from the previous year.
Fair value
The Directors consider that the carrying amounts of financial assets and financial liabilities recorded at cost less any accumulated impairments in the financial
statements approximates their fair values.
The fair values of financial assets and financial liabilities are determined as follows:
• Holdings in unlisted shares are measured at cost less any impairments. The directors consider that no other measure could be used reliably;
• Other financial assets and financial liabilities are determined in accordance with generally accepted pricing models.
34
Notes to the Consolidated Financial Statements
For the financial year ended 30 June 2018
Fair value estimation
The fair value of financial assets and financial liabilities are presented in the following table and can be compared to their carrying amounts as presented in
the Statement of Financial Position. Fair value is the amount at which an asset could be exchanged, or a liability settled between knowledgeable, willing
parties in an arm’s length transaction.
Fair values derived may be based on information that is estimated or subject to judgment, where changes in assumptions may have a material
impact on the
amounts estimated. Areas of judgment and the assumptions have been detailed below. Where possible, valuation information used to calculate fair value is
extracted from the market, with more reliable information available from markets that are actively traded. In this regard, fair values for listed securities are
obtained from quoted market bid prices. Where securities are unlisted and no market quotes are available, fair value is obtained using discounted cash flow
analysis and other valuation techniques commonly used by market participants.
Differences between fair values and carrying amounts of financial instruments with fixed interest rates are due to the change in discount rates being applied
by the market since their initial recognition by the Group. Most of these instruments, which are carried at amortised cost (i.e. term receivables, held-to-maturity
assets), are to be held until maturity and therefore the fair value figures calculated bear little relevance to the Group.
2018
2017
Carrying amount
Fair value
Carrying amount
Fair value
Financial assets
Cash and cash equivalents
Loans and other receivables
Other non-interest bearing receivables
Total financial assets
Financial liabilities
Trade and other payables
Total financial liabilities
675,461
80,866
22,603
778,930
272,810
272,810
675,461
80,866
22,603
778,930
272,810
272,810
218,722
239,214
8,916
466,852
95,245
95,245
218,722
239,214
8,916
466,852
95,245
95,245
The fair values disclosed in the above table have been determined based on the following methodologies:
Cash and cash equivalents, trade and other receivables and trade and other payables are short-term instruments in nature whose carrying amount is equivalent
to fair value. Trade and other payables excludes amounts provided for annual leave, which is outside the scope of AASB 139.
Financial Instruments Measured at Fair Value
The financial instruments recognised at fair value in the Statement of Financial position have been analysed and classified using a fair value hierarchy
reflecting the significance of the inputs used in making the measurements. The fair value hierarchy consists of the following levels:
- quoted prices in active markets for identical assets or liabilities (Level 1)
- inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (as prices) or indirectly (derived
from
prices) (Level 2); and
- inputs for the asset or liability that are not based on observable market data (unobservable inputs) (Level 3).
Consolidated
2018
Financial assets
Cash and cash equivalents
Cash on hand and fixed interest deposits
2017
Financial assets
Cash and cash equivalents
Cash on hand and fixed interest deposits
Level 1
$
Level 2
$
Level 3
$
Total
$
-
-
675,461
218,722
-
-
675,461
218,722
35
Notes to the Consolidated Financial Statements
For the financial year ended 30 June 2018
Note 27 Reserves
Equity - settled benefits reserve
The equity-settled benefits reserve is used to recognise the fair value options issued to Directors, employees and third parties.
Balance at beginning of financial year
Share-based payments reclassified
Balance at end of financial year
Note 28 Company details
Registered office of the Company:
Level 6, 412 Collins Street,
Melbourne, Victoria.
Principal place of business:
4 Bryant Street,
Corryong, Victoria.
Share Registry:
Automic Pty Ltd
Level 29, 201 Elizabeth Street
Sydney NSW 2000
Phone: +61 1300 288 664
Consolidated
2018
$
11,010
(11,010)
-
2017
$
193,060
(182,050)
11,010
36
Directors’ Declaration
ln accordance with a resolution of the directors of Dart Mining NL, the Directors of the Company declare that:
1 the financial statements and notes, as set out on pages 13 to 36, are in accordance with the Corporations Act 2001 and:
(a) comply with Accounting Standards which, as stated in accounting policy note 2 to the financial statements, constitutes compliance with
International Financial Reporting Standards (lFRS); and
(b) give a true and fair view of the financial position as at 30 June 2018 and of the performance for the year ended on that date of the consolidated
group:
2 in the directors’ opinion there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and
payable;
3 the directors have been given the declarations required by section 295A of the Corporations Act 2001 from the Chief Executive Officer and Chief
Financial Officer
The Company and a wholly-owned subsidiary, Dart Resources Pty Ltd, have entered into a deed of cross guarantee under which the Company and
subsidiary guarantee the debts of each other.
its
At the date of this declaration, there are reasonable grounds to believe that the companies which are party to this deed of cross guarantee will be able
to meet any obligations or liabilities to which they are, or may become subject to, by virtue of the deed.
_____________________
James Chirnside
Chairman
_____________________
Luke Robinson
Director
_____________________ _____________________
Dennis Clarke
Director
Melbourne
27 September 2018
Russell Simpson
Director
37
TO THE MEMBERS OF DART MINING NL
S REPORT
Report on the Financial Report
Opinion
We have audited the financial report of DART Mining NL, (the Company and its subsidiaries (the Group), which comprises the
consolidated statement of financial position as at 30 June 2018, the consolidated statement of profit or loss and other
comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the
year then ended, and notes to the financial statements, including a summary of significant accounting policies, and
declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act 2001, including:
(i)
year ended on that date; and
June 2018 and of its financial performance for the
(ii) complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are further
f the
Group in accordance with the auditor independence requirements of the Corporations Act 2001 and the ethical requirements of
t
are relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance
with the Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial
report of the current period. These matters were addressed in the context of our audit of the financial report as a whole, and in
forming our opinion thereon, and we do not provide a separate opinion on these matters.
TO THE MEMBERS OF DART MINING NL
S REPORT
Key Audit Matters (continued)
Key audit matter
How our audit addressed the key audit matter
1) Carrying value of Deferred Exploration and
Evaluation Costs
Refer to Note 14 ($7,571,747)
Deferred Exploration and Evaluation Costs of
$7,571,747 relate to costs incurred in relation to
the various tenements less impairment.
The
For the financial year ended 30 June 2018, the
Directors have assessed and determined a total
impairment amount of $1,653,710 on the
carrying value of Deferred Exploration and
Evaluation Costs. The impairment related mainly
to the expired tenement licence EL 5058
(Cudgewa) and surrendered tenement licence
MIN 5559 (Mountain View).
:
$7,571,747 carrying value of Deferred Exploration and
Evaluations Costs and reviewing assertions made by the
Directors.
confirming the expiration of tenement licence EL 5058
(Cudgewa) by reviewing the Earth Resources
GeoVic
website.
confirming that tenement licence MIN 5559 (Mountain
View) has been surrendered by obtaining a copy of the
notice of surrender.
Other Information
The directors are responsible for the other information. The other information comprises the information included in the Grou
Our opinion on the financial report does not cover the other information and accordingly we do not express any form of assurance
conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information and, in doing so, consider
whether the other information is materially inconsistent with the financial report or our knowledge obtained in the audit or
otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are
required to report that fact. We have nothing to report in this regard.
TO THE MEMBERS OF DART MINING NL
S REPORT
Responsibilities of the Directors for the Financial Report
The directors of the Company are responsible for the preparation of the financial report that gives a true and fair view in
accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors
determine is necessary to enable the preparation of the financial report that gives a true and fair view and is free from material
misstatement, whether due to fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the Group to continue as a going concern,
disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors
either intend to liquidate the Group or to cease operations, or has no realistic alternative but to do so.
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material
is
a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian Auditing Standards will
always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if,
individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis
of this financial report.
A further description of our responsibilities for the audit of the financial report is located at the Auditing and Assurance Standards
Board website at: https://www.auasb.gov.au/auditors_responsibilities/ar1.pdf
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in included in
June 2018.
In our opinion, the Remuneration Report of DART Mining NL, for the year ended 30 June 2018, complies with section 300A of the
Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the Remuneration Report in accordance
with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the Remuneration Report, based on
our audit conducted in accordance with Australian Auditing Standards.
MORROWS AUDIT PTY LTD
IAN L. JENKINS
Director
Melbourne: 27 September 2018
Auditor’s Report
ASX Additional Information
Additional information required by the Australian Securities Exchange Ltd Listing Rules and not disclosed elsewhere in this report is as follows. The
information is current as at 26 September 2018.
Twenty largest shareholders
Rank
Name of holder
KALAN SEVEN PTY LTD
RUSSELL SIMPSON
CITICORP NOMINEES PTY LIMITED
DYNASTY PEAK PTY LIMITED
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