A N N U A L R E -
P O R T 2 O 2 1
ANNUAL REPORT
2O
22
EXTRACT
UPGRADE
RECYCLE
ABN 15 117 330 757 Founded on a commitment to innovation
and sustainability, we are working towards
a clean energy future
EXTRACT
UPGRADE
RECYCLE
TanzGraphite Natural
Graphite Projects
HFfree Battery Anode
Material Facility
EcoGraf™ Anode
Material Recycling
Advanced, high quality, long
life Epanko and Merelani-
Arusha Graphite Projects
Production of battery anode
material for the lithium-ion
battery market
Proprietary purification
technology with sector
leading ESG credentials
1
ECOGRAF LIMITED ANNUAL REPORT 2022NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFor the Year Ended 30 June 2022 CONTENTS
CHAIRMAN’S
LETTER
DIRECTORS’
REPORT
FINANCIAL
STATEMENTS
INDEPENDENT
AUDITOR’S REPORT
SUMMARY OF
TENEMENTS
3
19
33
65
71
5
REVIEW OF
OPERATIONS
32
AUDITOR’S
INDEPENDENCE
DECLARATION
63
DIRECTORS'
DECLARATION
69
SHAREHOLDER
INFORMATION
74
CORPORATE
DIRECTORY
2
2
ECOGRAF LIMITED ANNUAL REPORT 2022 CHAIRMAN'S LETTER
We are living in interesting times.
With geopolitical upheaval, supply
chain disruptions, inflation and fear
of recession, it is surely a challenging
and uncertain business environment.
+ The necessity for secure, reliable
and long-term materials supply,
particularly considering recent
geopolitical upheavals and supply
chain disruptions
+ It is a large, long-life project with
forty plus years mine life in a stable
jurisdiction providing transforming
and life changing benefits to the
local and Tanzanian economy
But despite this, there is one certainty.
That is, the continued and rapid
investment growth in e-mobility and
battery manufacturing, particularly in
the European, North American and
East Asian markets.
Moreover, after years of industry focus
on the supply of cathode minerals
there has been a market shift to
concern over reliable and sustainable
supply of anode materials, particularly
natural flake graphite. As one of our
customers recently commented, “we
are facing a wall of demand for high
quality, sustainable natural flake
graphite.”
There are a number of factors
influencing this graphite market,
especially as it relates to demand
from EcoGraf’s target markets in
Europe, North America and East Asia,
including:
+ A shift from synthetic graphite,
produced from costly and high
emission hydrocarbons, to natural
flake graphite
+ A lack of new high quality, low cost
and reliable natural flake graphite
supply emerging
+ The imperative by EV
manufacturers for an
environmentally sustainable and
ethically produced supply chain,
from mine to motor car
+ Pressure on EV and battery
manufacturers to provide recycling
solutions for end-of-life batteries.
It has been our primary objective to:
+ understand this emerging market
+ accommodate the growing demand
with an integrated business plan
that meets customer requirements
+ become the preferred supplier of
sustainably and ethically produced
natural flake graphite and graphite
products for the EV and other
markets, and
+ provide recycling solutions for
production anode scrap and end of
life batteries.
A key platform for our business is the
Epanko Graphite Mine in Tanzania.
An enormous amount of time and
money has been invested in this
project and it is very pleasing to see
the considerable progress that has
been made in recent times towards its
imminent development. This project
ticks all the boxes that our customers
are seeking for the extraction of
graphite, including:
+ It is one of the highest quality
natural flake graphite projects in
the world. This is fundamental to
competitive graphite supply. It not
only guarantees high quality end
products, but also minimizes the
cost structure all the way from the
mine to each final product
+ It has low technical risk, having
been exposed to rigorous
feasibility studies and intensive
bank due diligence independently
conducted by international group
SRK Consulting (UK). Perhaps the
only emerging graphite project
exposed to such independent
scrutiny
+ Enormous effort and investment
have been made to ensure that its
ESG credentials are pre-eminent
with over twenty comprehensive
environmental, social and safety
studies and management plans
incorporated into the project
planning. Epanko adheres to the
highest ESG standards, complies
with Equator Principles and fully
satisfies IFC and World Bank
Group Environmental, Health and
Safety Guidelines, and
+ And most importantly, the Project
has very robust economics and
excellent growth potential.
High level discussions
have been taking place
with the government
of Tanzania and a
framework agreement to
facilitate construction is
imminent. At the same
time our financiers have
been re-engaged.
3
ECOGRAF LIMITED ANNUAL REPORT 2022NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFor the Year Ended 30 June 2022 CHAIRMAN'S LETTER
I am pleased to report that, as the
focus of manufacturers has shifted
to the anode supply chain and their
needs begin to be crystallised, the
Company has been inundated with
interest and enquiries across all
aspects of our business.
We are excited about the opportunities
that are emerging, and we are
continuing to adapt our business
plans to directly cater to the emerging
market and customer requirements.
The team at EcoGraf™ is expanding
accordingly and the work effort
increasing. Your Company remains in
a sound financial position with strong
financing support from both private
and government sectors.
Thank you to our shareholders for
your continuing support.
Robert Pett
Chairman
In response to the increasing graphite
demand, GR Engineering has been
commissioned to provide updated
capital estimates and expansion
options for the Project. This is well
advanced.
The Company is also examining
the feasibility of shaping graphite
in Tanzania to produce unpurified
spherical graphite. The idea of a global
hub for shaping graphite, prior to
purification, potentially has significant
strategic and cost advantages. It has
potential to not only reduce cost along
the production chain but also to satisfy
longer term and increasing customers
preferences for production of battery
graphite close to their manufacturing
facilities.
Upgrading our natural flake graphite
through downstream processing to
produce battery graphite and other
products has been an integral part
of our business plan, with the key
objective of developing an alternative
but environmentally friendly process
to produce purified spherical graphite
for battery anodes. The thrust over
the last year has been to establish the
first battery anode material facility in
Western Australia.
The original EcoGraf™ Battery
Anode Material Facility stage 1:
5,000tpa followed by stage 2:
20,000tpa production model will
now be replaced by a single-phase
~25,000tpa development and a
simplified commercial development
model will be supported by a new
stage 1 product qualification facility.
At the same time, global expansion
is planned with discussions being
held with battery industry customers
and government agencies for further
overseas facilities, co-located to
provide local supply and support
manufacturing growth. Consideration
is being given to supplying such
facilities with unpurified spherical
graphite from a central shaping hub.
The clean, green future
promised by e-mobility
is tarnished without
recycling of end-of-life
batteries.
Considerable investment has been
made in battery recycling to recover
cathode minerals, nickel, cobalt,
lithium etc., but little attention has
been paid to recycling of anodes.
EcoGraf™ has been able to apply
its HFfree purification process
for recycling of battery graphite
with outstanding results. Testing
has confirmed that the resulting
electrochemical performance of
recycled material matches that of
brand-new anode graphite.
Along with extraction, product
upgrading this recycling solution
provides electric vehicle
manufacturers with the opportunity to
achieve closed loop materials usage
and minimize their environmental
footprint through zero-waste from
batteries. This is a key objective for all
manufacturers in our target markets
and this EcoGraf™ initiative is receiving
huge interest.
4
ECOGRAF LIMITED ANNUAL REPORT 2022
REVIEW OF
OPERATIONS
5
ECOGRAF LIMITED ANNUAL REPORT 2022NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFor the Year Ended 30 June 2022 REVIEW OF OPERATIONS
OVERVIEW
EcoGraf is building a vertically
integrated battery anode material
business to produce high purity
graphite products for the lithium-ion
battery markets in Asia, Europe and
North America. Over US$30 million
has been invested to date to create
highly attractive mining and mineral
processing graphite businesses.
In Tanzania, the Company is
developing the TanzGraphite natural
flake graphite business, commencing
with the Epanko Graphite Project, to
provide a long-term, scalable supply
of feedstock for the EcoGraf™ battery
anode material processing facilities,
together with high quality large
flake graphite products for industrial
applications.
In addition, EcoGraf’s breakthrough
recovery of battery anode material
using its EcoGraf™ purification
process will enable battery supply
chain customers to reduce their CO2
emissions and lower battery costs.
Natural graphite is forecast to remain
the major raw material in the lithium-
ion battery, supporting the Company’s
scale-up and expansion plans.
Using a superior, environmentally
responsible EcoGraf HFfree™
purification technology, the Company
plans to produce high performance
battery anode material to support
electric vehicle, battery and anode
manufacturers in Asia, Europe
and North America as the world
transitions to clean, renewable
energy.
EcoGraf is building a vertically integrated battery anode material business to
produce high purity graphite products for the lithium-ion battery markets
Sweden, Skellefteå
industrial site
German
pilot plant
TanzGraphite Natural
Graphite Projects
6
ECOGRAF LIMITED ANNUAL REPORT 2022 REVIEW OF
OPERATIONS
MARKET UPDATE
Lithium-ion batteries have become the
dominant battery technology for use in
electric vehicles (EV). This dominance
is expected to continue given the
significant investment and expanding
capacity of lithium-ion gigafactories in
Asia, North America and Europe.
Increased demand for alternative
natural battery anode supply chains
and greater recycling has resulted
from continued government policies,
regulations and EV manufacturers
environmental and social governance.
Battery and EV manufacturers are also
recognising the environmental benefits
of natural graphite over synthetic
graphite, which is resulting in increased
forecast use of natural graphite in the
battery anode, increasing from 35%
currently, to over 50% by 2030.
EV adoption rates are
forecast to increase
demand for lithium-
ion batteries with BMI
forecasting the market to
grow at a CAGR of 23.9%
over the next 10 years.
Natural flake graphite supply vs demand
Total demand
Operational supply
Probable additional tonnes
TONNES
11,000,000
10,000,000
9,000,000
8,000,000
7,000,000
6,000,000
5,000,000
4,000,000
3,000,000
2,000,000
1,000,000
0
6
1
0
2
8
1
0
2
0
2
0
2
2
2
0
2
4
2
0
2
6
2
0
2
8
2
0
2
0
3
0
2
2
3
0
2
4
3
0
2
6
3
0
2
8
3
0
2
0
4
0
2
Source: Benchmark Minerals Intelligence
7
ECOGRAF LIMITED ANNUAL REPORT 2022
REVIEW OF OPERATIONS
REVIEW OF OPERATIONS
Graphite is the major raw material for
the transition to clean energy
Anode - Tonnes
53.8%
Graphite
Source: World Bank
3.6M
3.0M
2.4M
1.8M
1.2M
0.6M
+30%
EV sales p.a.
0
2
0
2
5
2
0
2
0
3
0
2
Source: BloombergNEF
Natural graphite to increase from 35%
to over 50% in the anode by 2030
+50%
Natural
Synthetic
Other
Source: Benchmark Minerals Intelligence
Li-ion battery chemistry metal composition % mass
NMC 111
NMC 622
NMC 811
NCA
LFP
Graphite
Graphite
Graphite
Graphite
Graphite
No. of EVs
600M
500M
400M
300M
200M
100M
0
2
0
2
5
2
0
2
0
3
0
2
5
3
0
2
0
4
0
2
Source: Benchmark Minerals Intelligence
1.1kg per kWh
Lithium-ion battery to drive
strong demand for graphite
50kg – 55kg
Natural flake graphite is
required per EV
Graphite
Lithium
Cobalt
Nickel
Manganese
Iron
Aluminum
Phosphate
Graphite will continue as the dominant
anode material in lithium-ion batteries
27kg of 99.95%
High purity battery grade of
anode material is required per EV
8
ECOGRAF LIMITED ANNUAL REPORT 2022 REVIEW OF
OPERATIONS
EXTRACT
TanzGraphite Natural
Graphite Projects
The Epanko Graphite Project
(“Epanko” or the “Project”) (EGR:100%)
is a long life, highly profitable graphite
project located approximately 370km
from the city of Dar es Salaam in
Tanzania. It is forecast to initially
produce 60,000 tonnes of natural
flake graphite products each year.
The Company’s natural
flake graphite business is
focussed on development
of the long-life, high
quality Epanko Graphite
Project in Tanzania.
Extensive work has been undertaken
at Epanko to establish a development-
ready new graphite mine, including:
+ Bankable Feasibility Study (BFS)
demonstrating a highly attractive
development opportunity
+ Granted mining licence and
environmental approvals
+ Independent Engineer’s Review
by SRK Consulting on behalf of
lenders, confirming technical
aspects of the proposed
development and that the Equator
Principles social and environmental
planning satisfies International
Finance Corporation Performance
Standards and World Bank Group
Environmental, Health and Safety
Guidelines
+ Flake graphite sales for key markets
in Europe and Asia
+ Target cost EPC arrangements for
construction of Epanko with GR
Engineering, and
+ Project financing program involving
international and Tanzanian financial
institutions.
Extensive evaluation conducted over
the last 8 years by EcoGraf™ with
prospective customers demonstrates
that the unique geology of Tanzanian
graphite delivers a superior battery
anode material product which
outperforms other global reference
materials in mechanical shaping,
purification and electrochemical
benchmarking analysis.
Not all graphite is equal
Exceptional geology provides superior battery
performance and value-in-use
Specific Capacity (mAh/g)
e
c
n
a
m
r
o
f
r
e
P
364
362
360
358
356
354
352
350
348
346
344
9
Industry
Material 1
Industry
Material 2
Industry
Material 3
Epanko
ECOGRAF LIMITED ANNUAL REPORT 2022
REVIEW OF OPERATIONS
REVIEW OF OPERATIONS
EPANKO FRAMEWORK
AGREEMENT
EPANKO EXPANSION
STRATEGY
The Company has held positive
meetings with the Tanzanian
Government in relation to the Epanko
Framework Agreement for the
development and operation of the
proposed new mine, with both parties
working to finalise the agreement.
EcoGraf™ has presented its Tanzanian
graphite strategy to the Government,
including the future expansion of
production at Epanko to support
growth in battery graphite demand, the
development of its Merelani-Arusha
Graphite Project and an evaluation of
the potential for in-country mechanical
shaping facilities to create a global
Tanzanian graphite supply base.
Meetings have also been held with the
Tanzanian Export Processing Zones
Authority, the Tanzanian Revenue
Authority and Government officials
from Tanzania’s key trading partners.
As a first mover in the Tanzanian
graphite sector, the Company identified
Epanko as a highly prospective,
long-life graphite project, with the
bankable feasibility study satisfying
rigorous due diligence by bank
appointed Independent Engineer’s
SRK Consulting and achieving sector
leading ESG credentials.
This uniquely positions EcoGraf’s
integrated graphite business to
support increasing demand for
high purity graphite products, with
flake graphite mining operations in
Tanzania supplying feedstock for the
Company’s HFfree battery anode
material facilities and large and jumbo
flake graphite to be exported to high
value industrial markets.
In response to increasing demand for
graphite, EcoGraf™ has commenced
an evaluation of expansion options for
Epanko to identify the most efficient
pathway to scale-up production
significantly beyond its initial
60,000tpa capacity to supply the high
growth battery graphite market.
The quality of Epanko graphite is
the result of two key geological
advantages, a calc silicate dominant
host gangue mineral with very little
deleterious elements and very high
crystallinity caused by extremely
high metamorphic pressure and
temperature. Flake graphite crystallinity
provides its physical and industrial
properties, with the favourable Epanko
mineralogy resulting in improved
recoveries, product quality and
economic efficiency.
As a result of these geological features,
Epanko flake graphite is easily liberated
using a low-cost, efficient flotation
process to produce high quality
graphite products, supported by the
Company’s large scale 200 tonne bulk
sample program that has outperformed
the Ore Reserve block model grades,
confirming the integrity of the model
and demonstrating the robust nature
and significant upside of the Epanko
Mineral Resource Estimate undertaken
by CSA Global.
A number of specialists are supporting
the Company’s internal team and
GR Engineering in the expansion
assessment, which will leverage
extensive geological and mineral
processing studies completed for the
Epanko bankable feasibility program.
Natural
Synthetic
MCMD
Silicon
LTO
Other
Flake Graphite Demand and Anode Material Split
2022
2025
35%
63%
1%
1%
43%
53%
3%
1%
2030
50%
41%
5%
2%
2%
Flake graphite demand from lithium-ion batteries only
1.3mt
3.5mt
0.5mt
Source: Benchmark Minerals Intelligence
1 0
ECOGRAF LIMITED ANNUAL REPORT 2022 REVIEW OF
OPERATIONS
POSITIVE ECONOMIC IMPACT
The Project has strong economics
and will provide inter-generational
economic and social benefits for the
regional community near Mahenge in
Tanzania and will support Tanzania’s
positive industrialisation progress.
Epanko is expected to operate for
40+ years and in that time is forecast
to deliver direct economic benefits
of over US$3 billion to Tanzania via
employment, procurement, royalties,
taxes and dividends. Over 95% of the
300 permanent staff will be Tanzanian,
with an estimated 4,500 indirect
jobs to be supported by the Epanko
operation.
DEVELOPMENT FUNDING
During the year EcoGraf™ appointed
financial advisors to advance the
proposed debt financing arrangements
for construction of the Epanko Graphite
Project.
The Company and its financial advisors
are engaging with a range of financial
institutions globally that have expressed
interest in supporting the Epanko
development. An independent graphite
market study is being completed, with
the results to be incorporated into
the feasibility study financial model,
together with the outcomes of the GR
Engineering program and the agreed
terms of the Epanko Framework
Agreement.
Financial modelling and debt
structuring confirms that Epanko is
a highly profitable, cash generative
operation and the funding process is
benefitting from the stronger product
demand and pricing environment.
SECTOR LEADING ESG
CREDENTIALS
The Epanko bankable feasibility study
social and environmental planning
programs have been independently
assessed by SRK (UK) to comply with
the Equator Principles, a globally
recognised risk management
framework adopted by leading
financial institutions for assessing and
managing social and environmental
risks in new developments.
Achieving this standard and satisfying
International Finance Corporation
Performance Standards and World
Bank Group Environmental, Health and
Safety Guidelines is critical to securing
international financing support for
the new development and reflects
EcoGraf’s commitment to the ensuring
the highest level of Environmental,
Social and Governance operating
standards.
APPOINTMENT OF KEY
DIRECTOR
The Company has also appointed
Ms Christer Mhingo as director
of TanzGraphite (TZ) Limited, its
Tanzanian subsidiary and owner of the
Epanko Graphite project. Christer is a
highly skilled, dynamic and motivated
geologist, experienced in working with
exploration and mining companies
across a range of commodities in
Africa and overseas.
EcoGraf's TanzGraphite team was recognised as ‘first runner’ at the International
Minerals and Mining Investment conference with the award in recognition of the
interest generated by the Epanko Graphite Project and the Company's support for
the Government’s efforts to promote Tanzania’s minerals sector.
1 1
ECOGRAF LIMITED ANNUAL REPORT 2022 UPGRADE
HFfree Battery Anode
Material Facility
The Company’s is developing a
HFfree Battery Anode Material Facility
that will be the first of its kind outside
of China, providing a new supply of
sustainably produced, high quality
purified spherical graphite for the high
growth lithium-ion battery market.
In November 2021 EcoGraf™
announced entry into a non-binding
Memorandum of Understanding with
POSCO International, a subsidiary of
leading global anode manufacturer
POSCO, based in South Korea. Under
the agreement EcoGraf™ will support
POSCO’s anode production expansion
plans through the supply of battery
anode material products and the
parties intend to co-operate in relation
to future product development and
anode recycling operations.
Significant endorsement and
support for a new battery anode
material facility has been received
from Australian Federal and State
Governments through the granting of
Australian Major Project Status and
award of Lead Agency status by the
Western Australian Government.
During the year EcoGraf™ worked
with the Australian Critical Minerals
Facilitation Office, the Major Projects
Facilitation Agency, Austrade, Export
Finance Australia and the Western
Australian Department of Jobs,
Tourism, Science and Innovation to
develop the new facility and support
Australia’s role in the global lithium-
ion battery industry.
The Company made
significant progress
during the year to
achieve key milestones
for the development of
the new battery graphite
facility.
DEVELOPMENT
Key development activities during the
year included:
+ Submission of applications for the
granting of regulatory approvals
+ Optimisation of the process
flowsheet, equipment testing and
waste stream management, and
+ Planning and resourcing (project
implementation, scheduling and
recruitment).
REVIEW OF OPERATIONS
In September 2022 the Perth Metro
Outer Joint Development Assessment
Panel and the West Australian
Department of Water & Environmental
Regulation confirmed the granting
of Development and Works
Approvals for the commencement
of development. This successful
outcome was the culmination of
an extensive assessment process
undertaken by EcoGraf™ and its
consultants during the year.
In February 2022, the Company
announced that a loan of US$40
million has been conditionally
approved by the Australian
Government for the HFfree Battery
Anode Material Facility, as part of the
A$2 billion Australian Critical Minerals
Facility, which is managed by Export
Finance Australia.
1 2
ECOGRAF LIMITED ANNUAL REPORT 2022 REVIEW OF
OPERATIONS
In recent months EcoGraf™ has
received multiple approaches from
North American and European electric
vehicle manufacturers for the supply
of battery anode material products,
which have focussed on the ability of
the Company to scale-up production
rates to meet demand requirements in
those regions.
The increased interest in new,
sustainable supply chains is shaped
by geopolitical events and recent
initiatives led by the United States,
the Mineral Security Partnership to
secure critical raw materials for the
clean energy transition, through
responsible resource development
and the Inflation Reduction Act, that
incentivises mass market adoption of
electric vehicles.
Graphite dominates battery mineral
demand by volume, with recent
forecasts by PwC Strategy& in
Germany that it will rapidly grow from
200,000t in 2021 to almost 5mt by
2035 (see below).
Member countries of the Mineral
Security Partnership Australia,
Canada, Finland, France, Germany,
Japan, the Republic of Korea, Sweden,
the United Kingdom, the United States
and the European Commission are
collaborating to mobilise investment
from Governments and the private
sector for strategic opportunities
across the full value chain that adhere
to the highest environmental, social
and governance standards.
EcoGraf™ is in discussion with
Government trade representatives
in Australia, North America and
Europe to support development of its
vertically integrated battery minerals
business under this Mineral Security
Partnership.
As a result, EcoGraf™ believes there is
a significant opportunity to scale-up its
battery anode material development
plans to support customers in
these key lithium-ion battery
growth markets, positioning for the
development of additional production
facilities in key international markets.
Establishment of these regionalised
battery anode supply chains reflects
an increased focus on natural battery
anode graphite as an environmentally
superior alternative to displace
hydrocarbon (fossil fuel) generated
synthetic graphite.
The Company has commissioned an
independent cradle-to-gate study to
assesses the CO2 advantages of its
EcoGraf HFfree™ process technology,
a key requirement for battery and
electric vehicle manufacturers. The
ISO standard study includes the
carbon emissions footprint for multiple
production locations compared to the
existing anode material supplies from
China and also synthetic graphite.
Global active material demand ramp-up1 (million tons)
10
9
8
7
6
5
4
3
2
1
0
34%
CAGR
0.2
0.4
0.6
0.9
1.2
1.4
1.7
2.6
2.2
3.1
3.4
3.7
3.9
4.5
4.9
2021 2022
2023
2024
2025
2026
2027 2028 2029 2030 2031 2032 2033 2034 2035
Gigafactories and Raw Materials. Source: Strategy&
1. Strategy& projections based on EV sales figures
Lithium
Nickel
Manganese
Cobalt
Graphite
1 3
ECOGRAF LIMITED ANNUAL REPORT 2022 Full cycle active anode recovery
REVIEW OF OPERATIONS
PRODUCT DEVELOPMENT
INITIATIVES
Supporting the Company’s zero-
waste operating strategy for its new
EcoGraf™ Battery Anode Material
(BAM) facility is the Company’s
product development programs
to access higher-value customer
markets and maximise the economic
and sustainability advantages of the
unique EcoGraf™ purification process.
An extensive international product
development program is being
undertaken for the by-product fines
that’s generated from the manufacture
of EcoGraf HFfree™ high density
battery anode material (hdBAM) and
ultra-fine high performance superBAM
products. Product development for
the by-product fines is focussed on
recarburisers, conductivity enhancers
and high purity fines.
In collaboration with FYI Resources
Limited, the Company is developing
enhanced HPA coating techniques
to improve battery performance.
Testwork is being undertaken
in the USA, combining EcoGraf
HFfree™ spherical graphite and
FYI’s innovative, ultrafine 4N HPA to
generate HPA-doped coated spherical
graphite.
The Company will continue its product
development program to maximise
the value of its products and support
the global transition to clean energy,
given graphite is the major raw
material required.
INTELLECTUAL PROPERTY
The Company has sought to protect
its intellectual property assets through
the use of patents and trademarks.
During the year the International
Preliminary Examining Authority of the
Patent Co-operation Treaty confirmed
that it has deemed all 25 of the
EcoGraf HFfree™ purification process
patent claims as novel and inventive.
Based on this positive examination
and finding, in December 2021 the
Australian Government, through IP
Australia, confirmed acceptance of the
Company’s patent application for its
unique EcoGraf HFfree™ purification
technology.
The purification technology was first
developed by EcoGraf™ in Australia
and has been refined through extensive
testing and analysis conducted over the
last seven years in Europe and Asia.
IP Australia received objections to the
grant of the Australian patent from
a graphite company and its process
consultant, which triggers a process of
submission and hearing to enable IP
Australia to determine the matter, with
a decision not expected until next year.
Protection of EcoGraf’s significant
investment since 2015 in proprietary
processing, innovation and
technology is advantageous to its
business and benefits Australia’s
position as a major supplier of critical
minerals to global battery markets.
The development of new Australian
technologies supported by patents
strongly aligns with the core principles
of the Australian Government’s Critical
Minerals Strategy.
APPOINTMENT OF KEY EXECUTIVE
EcoGraf™ has appointed experienced
executive Mr Dale Harris as Chief
Operating Officer, with responsibility
for driving the development of
its integrated battery graphite
businesses. Mr Harris has over 30
years’ industry experience across
the resources, mineral processing
and engineering sectors, with
a demonstrated track record in
successful project delivery and
operational performance.
Product Development Program
END USE:
ELECTRIC VEHICLES,
STORAGE PACK
END USE:
HYBRID CARS/ POWER
TOOLS & 3C APPLICATION
END USE:
CAST & GREY CAST STEEL
FOUNDRY/EAF FURNACE
END USE:
AA, AAA, LI-ION CEM
CATHODE & CAN COATING
END USE:
LUBRICANTS, THERMAL
EFFICIENT AND FIRE
RESISTIVITY MATERIALS
SPG16
LI+
HPA
D OP ED
A NO DE
LI+
LI+
LI+
LI+
LI+
The Company is developing enhanced
HPA coating techniques to improve
battery performance
1 4
ECOGRAF LIMITED ANNUAL REPORT 2022 REVIEW OF
OPERATIONS
REVIEW OF OPERATIONS
RECYCLE
RECYCLE
EcoGraf™ Anode
Material Recycling
The addition of EcoGraf’s
recycling application,
using its HFfree™
proprietary purification
process, provides a
unique and vertically
integrated business
that meets the new age
requirements for raw
materials.
EcoGraf™ is leveraging its proprietary
EcoGraf HFfree™ purification process
to recover and re-use anode materials,
with an initial focus on production
scrap from anode cell and battery
manufacturing processes.
The Company has engaged a leading
European anode recycling specialist
to advise on refining its anode
recycling process for a range of anode
waste materials. An initial program
completed at the Helmholtz Institute
in Germany during the year compared
the electrochemical performance of
graphite from end-of-life batteries
recycled using the EcoGraf HFfree™
purification process with commercial
battery graphite benchmarks.
The testing confirmed that the
electrochemical performance of the
EcoGraf HFfree™ recovered graphite
matches that of the brand-new
commercial anode graphite.
The outcome is further validation of the
effectiveness of the EcoGraf HFfree™
purification process for the production
of high-performance battery graphite,
as well as the re-use of recycled
battery anode material for anode,
battery and electric vehicle customers.
EcoGraf™ believes this recycling
capability will fundamentally change
the dynamics of the battery supply
chain, leading to a significant reduction
in CO2 emissions and lowering overall
battery production costs.
Recycling provides an opportunity to
support electric vehicle and battery
manufacturers achieve sustainable,
closed-loop manufacturing processes
as part of the global effort to develop
a circular economy through
zero-waste batteries to address the
growing environmental costs from
end-of-life batteries and to improve
battery manufacturing efficiencies.
RecoBAM™ is the recovered carbon
anode material product using
EcoGraf’s HFfree™ processing
technology and contains both natural
battery graphite and synthetic graphite.
RecoBAM™ recycled, high purity
anode material
RecoBAM™ combines the benefits of both synthetic and natural graphite
Material
Environmental
Energy
Plate shapes
synthetic graphite
Oval shaped particles
(spheronised natural graphite
shaped synthetic
and natural graphite particles)
Synthetic
Graphite
Natural
Graphite
RecoBAM™
Safety
Cost
Life
1 5
ECOGRAF LIMITED ANNUAL REPORT 2022NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFor the Year Ended 30 June 2022 REVIEW OF OPERATIONS
ENVIRONMENTAL, SOCIAL AND GOVERNANCE
EcoGraf™ is committed to ensuring strong environmental, social and governance standards across all areas of its operations.
Its diversified battery anode material business is founded on a vision to support the global transition to clean, renewable
energy through innovation and sustainability.
The Company has implemented a comprehensive Corporate Governance Plan that provides a framework for the effective
strategic direction and management of its business activities and includes the following:
Charters and Codes
+ Board Charter
+ Code of Conduct
+ Audit and Risk Committee Charter
+ Remuneration Committee Charter
+ Nomination Committee Charter
The charters, codes and policies have
been developed under the guidance
of the ASX Corporate Governance
Council’s 4th Edition of the Corporate
Governance Principles and
Recommendations, the Corporations
Act 2001 and independent external
advice. Collectively, they reinforce
and promote a culture of good
corporate citizenship across the
organisation in relation to strategic
oversight, stakeholder relations,
regulatory compliance, business
conduct, personal behaviours and risk
management.
Policies
+
+
+
+
+
+
+
+
Performance Evaluation Policy
Continuous Disclosure Policy
Risk Management Policy
Trading Policy
Diversity Policy
Shareholder Protection Policy
Whistle-blower Protection Policy
Anti-Bribery and Anti-Corruption Policy
A copy of the Corporate Governance
Plan, the annual Corporate
Governance Statement and the
EcoGraf™ Constitution are available on
the Company’s website at:
www.ecograf.com.au.
The Company has led the way within
the graphite market in developing
a new, highly effective and more
eco-friendly battery anode material
purification process that can also be
applied to recycle battery anodes.
In terms of environmental
performance, EcoGraf™ is a leader
within its sector and environmental
sustainability is critical to the
successful development of its
businesses and a key priority in its
planning and development decisions.
In terms of environmental
performance, EcoGraf™ is
a leader within its sector
1 6
ECOGRAF LIMITED ANNUAL REPORT 2022 REVIEW OF
OPERATIONS
locally. This will also provide the
opportunity for other benefits through
training and development, construction
of new community facilities and
support for local businesses and
community organisations.
An extensive Resettlement Action Plan
has been developed for the Epanko
Graphite Project that includes a
comprehensive community investment
package consisting of new and
improved housing, upgraded road
infrastructure, new school, medical
dispensary, church, related community
infrastructure and assistance with the
establishment of sustainable micro-
enterprises among village family
groups.
EcoGraf™ participates in various
research and economic development
forums in Australia and Europe to
encourage the discovery of new
clean energy technologies that can
accelerate the achievement of global
climate change goals and provide new
areas of economic growth and future
career opportunities.
Promoting sector
leading environmental,
social and corporate
governance practices
is a key focus for the
Company as it continues
to expand its operations
and generate sustainable
long-term shareholder
value.
Key environmental aspects of each of
the Company’s businesses include:
ECOGRAF™ NATURAL FLAKE
GRAPHITE
+ Completion of the Epanko bankable
feasibility study in accordance
with the Equator Principles
(an internationally recognised
risk management framework,
adopted by financial institutions,
for determining, assessing and
managing environmental and social
risk in projects)
+ Independent review by SRK
Consulting confirming that
environment and social planning
satisfies the International Finance
Corporation Performance
Standards and the World Bank
Group Environmental, Health and
Safety Guidelines
+ Funding support from German
Government development
bank KfW IPEX-Bank with
loan arrangements linked
to environmental and social
performance, and
+ Power sourced through sustainable
hydro-facilities.
ECOGRAF™ BATTERY ANODE
MATERIAL
+ Development of EcoGraf HFfree™
processing technology to eliminate
the use of hydrofluoric acid in the
manufacture of battery anode
material and a new state-of-the-
art facility engineered to achieve
leading international operating
standards
+ Use of Life Cycle Assessment
analysis to support global CO2
reduction initiatives
+ Selection of the site location in
an existing industrial precinct that
has no impact on visual or noise
amenity
+ Implementation of a zero-waste
operating strategy focussed on
an active product development
program to value-add all byproduct
material produced at the new
facility and to provide product
additives for use in green steel
production
+ Recycling of of process water used
in the operation, and
+ Potential for sustainable power
to be supplied from nearby
waste-to-energy facilities and for
supplemental power requirements
to be sourced via solar panels.
ECOGRAF™ LITHIUM-ION
BATTERY RECYCLING
+ Successful application of the
EcoGraf™ purification technique
to recover carbon anode material
from lithium-ion battery production
waste and end-of-life batteries
+ Opportunity to support global
battery recycling initiatives to
reduce CO2 emissions from the
manufacture of electric vehicles
and to lower battery life cycle costs,
and
+ Enables electric vehicle and battery
manufacturers to adopt closed-
loop supply chains to maximise
production efficiencies and meet
stringent legislative requirements
for recycling.
Social responsibility is also
fundamental to the success of
EcoGraf™ and a key priority in its
corporate and project development
activities. The Company maintains a
strong commitment to stakeholder
engagement and actively participates
in community and regional
development initiatives.
In Tanzania, development of the
Epanko Graphite Project will deliver
inter-generational economic and
social benefits over an estimated
40+ years of operation. Nationally, it
is forecast that over US$3 billion will
be contributed to Tanzania through
employment, procurement, royalties,
taxes and dividends, with over 95%
of the permanent staff to be recruited
1 7
ECOGRAF LIMITED ANNUAL REPORT 2022NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFor the Year Ended 30 June 2022 REVIEW OF OPERATIONS
INNOGY MINERALS
LIMITED
EcoGraf™ announced plans for the
demerger and initial public offering
(IPO) of cathode minerals subsidiary,
Innogy Limited (Innogy), with the
intention of maximising the opportunity
for all existing EcoGraf™ shareholders
to take up shares in the new business.
Using its extensive database of nickel
exploration opportunities in Tanzania,
the Company has assembled a
nickel exploration tenement package
totalling 4,600km2 in one of the
most exciting nickel regions on
earth, including 140km continuous
strike length in the Karagwe-Ankole
Belt, which hosts the world class
Kabanga Nickel Project, the largest
development ready high-grade nickel
sulphide deposit in the world.
Preparation for the IPO is well
advanced, with approvals received
from regulatory authorities, completion
of the Prospectus and appointment of
a Lead Manager.
Separate ASX listing of Innogy will
enable it to access the exploration
funding and management talent
required to develop the nickel
interests and the IPO structure has
been designed to prioritise the
interests of EcoGraf™ shareholders
who wish to directly participate in this
new opportunity, while also providing
a continuing indirect exposure
to Innogy through a cornerstone
shareholding to be retained by
EcoGraf™.
innovative
energy.
PRI MED F OR EX PLO RATI ON
W ITHIN THE WORLD’S MOS T
E XCIT ING NICK EL FRONT IE R
DIRE CT E XP OSU RE TO
A HIGHLY CRITI CAL
BAT T ERY MATE RIAL
T ANZANIA’S E LE V AT ION
T O A W ORLD CLAS S
MINING DE ST INATIO N
A SO CIALLY AW ARE
AND E NVIRO NME NTALLY
RE SPO NSIBLE T E AM
1 8
ECOGRAF LIMITED ANNUAL REPORT 2022NEWS200KmTANZANIADAR ES SALAAMMBEYATABORADODOMAARUSHAMOROGOROTANGABUZWAGINORTH MARABULYANHULUDUTWANTAKA HILLKAPALAGULAMWANZALINDI MTWARASOUTHERNFRONTIERNickel ProjectKAPALAGULAWESTERNFRONTIERNickel ProjectGOLDENEAGLEGold ProjectAFRICAPortLEGENDCityRailProposed RailInnogy ProjectsEcoGraf ProjectsTanzania Nickel DepositsCountry BordersKABANGANORTHERN FRONTIERNickel Project >60% YIELD
MAXIMISE EFFICIENCY
AN D PROFITABILI TY
75% WATER
TO B E REUSED IN OPE RAT ION
DIRECTORS'
REPORT
1 9
ECOGRAF LIMITED ANNUAL REPORT 2022NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFor the Year Ended 30 June 2022 DIRECTORS' REPORT
Dynamic, experienced board and
management team
Robert Pett
Independent
Non-Executive Director
and Chairman
Andrew Spinks
Managing Director
John Conidi
Independent
Non-Executive Director
Dale Harris
Chief Operating Officer
Howard Rae
Chief Financial Officer
and Joint Company
Secretary
Karen Logan
Joint Company Secretary
Michael Chan
Executive Manager –
Product Development
Christer Mhingo
Director of TanzGraphite
Limited
Shaun Oneil
Executive Manager –
Project Development
Marshall Hestelow
Commercial Manager
2 0
ECOGRAF LIMITED ANNUAL REPORT 2022 DIRECTORS'
REPORT
Board of Directors and Executive Management
Robert Pett
Independent Non-Executive Director and Chairman
Robert Pett is a minerals economist with over 30 years’ experience working in exploration and mining. During this time, he
has worked internationally in the resources sector at senior levels both in Australia and Africa. He has been involved with
listed companies at all levels, from grass-roots exploration through to mine development, production and financing of more
than ten mining projects globally including East and West Africa and the construction of the Golden Pride Gold Mine in
Tanzania.
He was founding Chairman of Resolute Mining Limited (gold mines and exploration Africa and Australia), Sapphire Mines
Limited (gemstone mining and exploration), Reliance Mining Limited (nickel mining Kambalda), Senex Energy Limited
(petroleum production and exploration) and director of several other mining and exploration companies operating in Africa,
Asia and Australia in gold, base metals, petroleum and uranium.
Robert has also had an active involvement in education and community activities including over 10 years’ service to Murdoch
University Western Australia as Senator and Chairman of their Resources (Finance) Committee.
Andrew Spinks Managing Director
Andrew Spinks is a geologist with over 25 years’ professional experience in Australia, Asia and Africa on a range of
commodities including speciality and industrial minerals.
Andrew has worked in a range of diverse roles across exploration through to successful project developments, and has held
a number of board positions on both ASX and TSX.V listed companies.
Andrew was co-founder of TanzGraphite Pty Ltd and has been Managing Director of EcoGraf since its acquisition.
John Conidi
Independent Non-Executive Director
John Conidi is a Certified Practicing Accountant. He has over 20 years’ experience developing, acquiring and managing
businesses in the technology and healthcare sectors. In his role as Managing Director of Capitol Health Limited, he drove its
sustained expansion, increasing its market capitalisation, significantly.
John has extensive interests in the graphite sector. He is an experienced investor specialising in technology and resources
and is the Chairman of 333D Limited, that with EcoGraf, jointly owns 3D Graphtech Industries Pty Ltd.
Dale Harris Chief Operating Officer
Mr Harris is an engineer with over 30 years’ industry experience across the resources, mineral processing and engineering
sectors, with a demonstrated track record in successful project delivery and operational performance.
During a career of almost 20 years with Rio Tinto, Mr Harris held progressively more senior roles in Australia and overseas
in the areas of business planning and analysis, project development, construction and commissioning, mining and
mineral processing operations, business development, asset management, integrated planning, automation and business
improvement.
He was subsequently appointed Managing Director of Gindalbie Metals Limited and then Chief Executive Officer of its
Karara Mining Joint Venture, successfully turning-around the ramp-up of its multibillion-dollar mid-west magnetite mining
and beneficiation development. More recently, Mr Harris was a Director of global engineering group Hatch, where he was
responsible for leading the Perth office during a period of significant expansion and growth. During this time Dale and the
Hatch team worked with clients across multiple sectors on the development, construction, optimisation and management of
complex battery minerals, bulk commodity and base metal projects in Australia and overseas.
2 1
ECOGRAF LIMITED ANNUAL REPORT 2022 DIRECTORS' REPORT
Howard Rae Chief Financial Officer and Joint Company Secretary
Howard Rae is a Chartered Accountant with over 20 years’ experience in acquiring, developing, financing and operating a
range of businesses in Australia, Canada, Asia, Africa and Europe.
His career includes Chief Financial Officer roles with a number of successful ASX listed companies active internationally in
the precious and base metals, steel-making materials and industrial minerals sectors, together with directorships of several
unlisted and not-for-profit organisations.
During this time, he’s been responsible for new business development, joint ventures, structuring and negotiating corporate,
project and infrastructure funding transactions, sales and marketing, risk management and implementing business
improvement programs.
Karen Logan Joint Company Secretary
Karen Logan is a Chartered Secretary with extensive compliance, capital raising, merger and acquisition, IPO and backdoor
listing experience in a diverse range of industries including resources, technology, media, health care and life science.
She has assisted a substantial number of private start-ups and established businesses transition to being publicly-listed
companies for over 15 years.
Michael Chan Executive Manager – Product Development
Michael Chan has a degree in Minerals Engineering (University of Birmingham, England) and is a Chartered Engineer
(London) with 35 years' experience in senior operations, project development and commercial roles for multi-national and
ASX listed companies operating in Africa, Asia and the United States.
Michael has 8 years of graphite/spherical graphite/battery anode material project experience, 15 years' extensive rare earth
project experience as well as 13 years' of titanium dioxide commercial development project experience.
During this time, he’s been responsible for major test work programs, process flow sheet design and development, pilot
processing and graphite product development, core technical marketing, establishing pilot scale facilities, developing full
scale commercial plants and driving much of the detailed downstream test work in collaboration with end-users.
Shaun O’Neill Executive Manager – Project Development
Shaun O'Neill is a qualified metallurgist with 23 years' industry experience in operations, project management and
commissioning across a broad range of commodities, including battery and critical minerals.
During this time, he's been responsible for project managing the largest lithium hydroxide processing plant in Kwinana as well
as leading commissioning activities for BHP in mega brownfield and greenfield project developments.
Board of Directors
The qualifications of the directors are set out on page 21.
2 2
ECOGRAF LIMITED ANNUAL REPORT 2022 DIRECTORS'
REPORT
Directors’ Interests and Other Directorships
As at the date of this report, the interests (directly or indirectly held) of the directors in the shares and performance rights of
the Company are:
Director
Term
of office
Interest in
incentive
performance
rights over
ordinary shares
Interest in
ordinary
shares1
Australian listed
company
directorships
Former
directorships
(last 3 years):
Independent Non-Executive Director & Chairman
Robert Pett
Director since
9 November 2015
Chairman since
9 November 2015
Executive Directors
Andrew
Spinks
Director since
20 July 2012
Managing Director
since 22 April 2015
Independent Non-Executive Director
3,454,615
1,250,000
None
None
11,998,822
2,095,825
None
None
John Conidi
Director since
4 May 2015
3,019,402
1,250,000
333D Limited
(appointed 25
March 2015)
None
1
Securities interest in EcoGraf – as notified by the directors to the Australian Securities Exchange (“ASX”) in accordance with s.205G(1) of the
Corporations Act 2001.
Directors’ Meetings
The number of meetings of the Company's Board of Directors and of each Board committee held during the year ended
30 June 2022, and the number of meetings attended by each Director were:
Directors’ meetings
in person and by resolution
Audit & Risk Committee meetings
in person and by resolution
Number eligible
to attend
Number
attended
Number eligible
to attend
Number
attended
6
6
6
2
6
6
6
2
1
-
1
-
1
-
1
-
Director
Robert Pett
Andrew Spinks
John Conidi
Howard Rae
Operating and Financial Review
The information reported in this operating and financial review should be read in conjunction with the review of operations on
pages 5 to 18.
2 3
ECOGRAF LIMITED ANNUAL REPORT 2022 DIRECTORS' REPORT
Principal Activities
EcoGraf is building a vertically integrated battery anode material business to produce high purity graphite products for the
lithium-ion battery markets in Asia, Europe and North America. Over US$30 million has been invested to date to create highly
attractive mining and mineral processing graphite businesses.
In Tanzania, the Company is developing the TanzGraphite natural flake graphite business, commencing with the Epanko
Graphite Project, to provide a long-term, scalable supply of feedstock for the EcoGraf™ battery anode material processing
facilities, together with high quality large flake graphite products for industrial applications.
Using a superior, environmentally responsible EcoGraf HFfree™ purification technology, the Company plans to produce high
performance battery anode material to support electric vehicle, battery and anode manufacturers in Asia, Europe and North
America as the world transitions to clean, renewable energy.
In addition, EcoGraf’s breakthrough recovery of battery anode material using its EcoGraf™ purification process will enable
battery supply chain customers to reduce their CO2 emissions and lower battery costs.
Natural graphite is forecast to remain the major raw material in the lithium-ion battery, supporting the Company’s scale-up and
expansion plans.
Operating Results
The loss after income tax incurred by the consolidated entity for the year ended 30 June 2022 was $7,505,000 (2021: loss
$5,514,000).
Dividends
The directors do not recommend the payment of a dividend and no amount has been paid or declared by way of a dividend
to the date of this report.
Corporate Structure
EcoGraf Limited is a public company incorporated and domiciled in Australia, limited by shares. At the date of this report, the
Company had 450,333,459 ordinary shares on issue.
Forward looking statements
This report may contain references to forecasts, estimates, assumptions and other forward-looking statements. Although
the Company believes that its expectations, estimates and forecast outcomes are based on reasonable assumptions, it can
give no assurance that they will be achieved. They may be affected by a variety of variables and changes in underlying
assumptions that are subject to risk factors associated with the nature of the business, which could cause actual results to
differ materially from those expressed in this report. Investors should rely upon their own enquiries before deciding to acquire
or deal in the Company’s securities.
Significant Changes in State of Affairs
Significant changes in the state of affairs of the consolidated entity during the year (if any) are contained in the review of
operations and financial statement sections of this report.
Significant Events After the Balance Date
No matters or circumstances have arisen since 30 June 2022 that have significantly affected or may significantly affect:
• the consolidated entity’s operations in future financial years
• the results of those operations in future financial years; or
• the consolidated entity’s state of affairs in future financial years.
2 4
ECOGRAF LIMITED ANNUAL REPORT 2022 DIRECTORS'
REPORT
Future Developments, Prospects and Business Strategies
Likely future developments in the activities of the Company are referred to in the review of operations section of this report.
Environmental Issues
The Company’s operations are subject to environmental regulation under the laws of the Commonwealth of Australia and
Republic of Tanzania. The directors believe that the Company has adequate systems in place for environmental management
and are not aware of any breach of environmental requirements as they apply to the Company.
Proceedings on Behalf of the Company
No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings on behalf
of the Company, or to intervene in any proceedings to which the Company is a party, for the purposes of taking responsibility
on behalf of the Company for all or part of those proceedings.
No proceedings have been brought or intervened in on behalf of the Company with leave of the Court under section 237 of
the Corporations Act 2001.
COVID-19 Pandemic
The COVID-19 world-wide pandemic has not significantly affected the operating or financial activities of the Company at this
stage of its development. Significant and prolonged pandemic lockdown conditions may impact development activities if
not dealt with in future years. The Company remains confident that operations and financial activities will not be significantly
affected.
Company Secretary
Howard Rae is the joint company secretary, having been appointed on 18 July 2017. Howard’s qualifications are set out on
page 22. Karen Logan is the joint company secretary, having been appointed on 3 November 2021. Karen's qualifications are
set out on page 22.
Indemnifying Directors and Officers
The Company has entered into an agreement to indemnify all directors and officers against any liability arising from a claim
brought by a third party against the Company. The Company has paid premiums to insure each director and officer against
liabilities for costs and expenses incurred by them in defending any legal proceedings arising out of their conduct while
acting in the capacity of director and officer of the Company, other than as a result of conduct involving a willful breach of
duty in relation to the Company.
Indemnification of Auditors
To the extent permitted by law, the Company has agreed to indemnify its auditors, RSM Australia Partners, as part of the
terms of its audit engagement agreement, against claims by third parties arising from the audit (for an unspecified amount).
No payments have been made to indemnify RSM Australia Partners to the date of this report.
Non-Audit Services
The directors are satisfied that the provision of non-audit services is compatible with the general standard of independence
for auditors imposed by the Corporations Act 2001. The directors ensure that:
• non-audit services are reviewed and approved to ensure that the provision of such services does not adversely affect the
integrity and objectivity of the auditor, and
• audit services do not compromise the general principles relating to auditor independence in accordance with APES 110:
Code of Ethics for Professional Accountants set by the Accounting Professional and Ethical Standards Board.
The total remuneration for audit and non-audit services provided during the prior and current financial years is set out in note
17 of the consolidated financial statements.
2 5
ECOGRAF LIMITED ANNUAL REPORT 2022 DIRECTORS' REPORT
Auditor’s Independence Declaration
The auditor’s independence declaration as required under section 307C of the Corporations Act 2001, is set-out on page 32
of this report.
Rounding
The amounts contained in this report and in the consolidated financial statements have been rounded to the nearest $1,000
(unless otherwise stated) under the option available to the Company under ASIC Corporations (Rounding in Financial/
Directors’ Reports) Instrument 2016/191. The Company is an entity to which the legislative instrument applies.
Corporate Governance
The directors of EcoGraf are responsible for the corporate governance of the Company and have applied ASX Corporate
Governance Principles in a manner that is appropriate to the Company’s circumstances.
The Company’s corporate governance statement is available on the Company’s website at www.ecograf.com.au.
Remuneration Report (Audited)
1.
INTRODUCTION
The following sections provide details of the remuneration paid to key management personnel by the Company and its
controlled entities for the year ended 30 June 2022. It forms part of the directors’ report and has been audited in accordance
with section 308C of the Corporations Act 2001.
Key management personnel are those persons who, directly or indirectly, have authority and responsibility for planning,
directing and controlling the major activities of the consolidated entity and include:
• non-executive directors, and
• executive directors and senior executives (collectively “executives”).
Key management personnel
Position
Tenure during the year
Non-executive directors
Robert Pett
John Conidi
Executive directors
Andrew Spinks
Senior executives
Howard Rae
Non-Executive Chair
Non-Executive Director
Full financial year
Full financial year
Managing Director
Full financial year
Chief Financial Officer & Joint Company Secretary
Full financial year
2 6
ECOGRAF LIMITED ANNUAL REPORT 2022 DIRECTORS'
REPORT
2. REMUNERATION GOVERNANCE FRAMEWORK
The remuneration structure adopted by the Company has been designed to promote alignment between the objectives
and interests of shareholders, directors and executives. Accordingly, as the Company’s key assets have not yet reached the
operational phase, a greater emphasis is placed on rewarding long-term performance through the award of equity in the
Company which preserves cash resources and is linked to the creation of shareholder value.
2.1 Remuneration principles
Key principles that guide decisions about key management personnel (KMP) remuneration are:
• Fairness: provide a fair level of reward to all employees
• Transparency: establish transparent links between reward outcomes and performance
• Alignment: promote mutually beneficial outcomes by aligning employee, customer and shareholder interests, and
• Culture: drive leadership performance and behaviours that promote safety, diversity and employee engagement.
2.2 Remuneration governance
Due to the current size of the Company, it is more efficient and effective for the functions otherwise undertaken by a
remuneration committee to be performed by the Board. All directors are therefore responsible for determining and
reviewing remuneration arrangements for executive key management personnel, including periodically assessing the
appropriateness of the remuneration structure and quantum by reference to relevant market conditions and prevailing
practices.
2.3 Use of remuneration consultants
From time to time the directors may seek independent external advice on the appropriateness of the remuneration
arrangements for key management personnel. During the year ended 30 June 2022, the Board engaged The Reward
Practice Pty Ltd to undertake a review of executive incentive arrangements. No remuneration recommendations, as defined
by the Corporations Act, were provided by the consultant.
3. EXECUTIVE KMP REMUNERATION ARRANGEMENTS
A combination of fixed and variable reward is provided to executives, based on their responsibility within the Company
in relation to the achievement of its strategic objectives and capacity to contribute to the generation of long-term
shareholder value.
The components of executive KMP remuneration consist of fixed remuneration and variable equity-based short and long-
term incentive arrangements. The following table presents a summary of remuneration components for executive KMP for
the year ended 30 June 2022.
Fixed remuneration
Equity-based, variable / at risk remuneration
Purpose
How the
remuneration is
delivered and
assessed?
Provide fair remuneration
to recognise executive
responsibilities and
impact on the business.
Cash
Remuneration level is
reviewed annually by
the Board and may be
adjusted based on the
practices adopted by
similar companies and
changes in responsibilities
and scope.
Assist the attraction, retention and incentivisation of executives in a cash
efficient manner, and
Enable the Company to develop its graphite businesses and grow
long-term shareholders value.
STI
(100% performance rights)
LTI
(100% performance rights)
Awarded annually based on
performance against KPIs.
See 3.1 for further details.
Performance rights may be granted
to executives which will vest based
on achievement of the Company’s
long-term objectives.
2 7
ECOGRAF LIMITED ANNUAL REPORT 2022 DIRECTORS' REPORT
3.1 Equity-based incentive arrangements
On 25 November 2020 shareholders approved the adoption of the Company's Incentive Performance Rights Plan, which is
designed to assist with the recruitment, reward, retention and incentivisation of key personnel who possess the skills and
experience to enable the Company to develop its graphite businesses and grow long-term shareholder value.
The Company is at a critical stage in its growth as it advances the new EcoGraf™ Battery Anode Material Facility and Epanko
Graphite Project to development and operational stages. The international graphite industry is also evolving rapidly to
support the demand for lithium-ion batteries in electric vehicles and the retention of specialised skills is essential to the
Company's future success.
To achieve this outcome, the Company believes that rewarding performance through equity arrangements is the most
effective incentive structure because it preserves the Company's cash reserves and aligns the interests of KMP with those of
shareholders. The equity-based structure includes STI and LTI components.
Short-term incentive (STI)
Under the STI plan, eligible participants can earn performance rights for the achievement of key performance outcomes
each year. The amount, if any, of short-term incentive awarded is determined after the end of each year, by assessing the
individual’s performance against the applicable key measures and then applying the resulting percentage score to the short-
term incentive remuneration opportunity.
For example, an individual with a fixed annual remuneration of $350,000, a short-term incentive opportunity of 40% and an
annual performance score of 75% will be entitled to an STI award of $105,000 = $350,000 X 40% x 75%.
The STI award is settled through the grant of performance rights, with the number determined by dividing the award amount
by the volume weighted average price of the Company’s shares during the applicable financial year. Upon exercise, each
performance right will entitle the eligible participant to receive one ordinary share in the Company.
The grant of performance rights for the STI award, if any, occurs after the end of the financial year.
As the Company’s battery minerals mining, processing and recycling businesses are in the development phase, the Board
considers it appropriate to measure the short-term performance of executive KMP through the achievement of outcomes
across four key areas as outlined in the following table:
KPI category and weighting
KPI areas of assessment
Business development
30%
Financial management
20%
Organisational development
20%
Innovation and continuous
improvement
30%
Effective advancement of the Company’s graphite businesses towards
construction and operations, including completion of studies, early works
programs, entering into contractual arrangements with constructors,
operators, suppliers and customers, securing support from financiers and
obtaining positive Government cooperation.
Delivery against annual financial budgets, including effective cost control
whilst achieving business objectives, accessing working capital on a timely
and cost-effective basis and protecting the Company from financial loss.
Building organisational capacity and resilience, through effective human
resource management, establishing appropriate operating structures to
support planned expansion, developing a positive corporate reputation with
stakeholders and overcoming adverse external impacts on the business.
Driving on-going progress in process and product development, leveraging
partnerships with Government and commercial organisations to explore new
technologies and markets that will add value and identifying opportunities to
continuously enhance and grow the business.
For the year ended 30 June 2022, the STI opportunity for the Managing Director and Chief Financial Officer was 40% of their
fixed remuneration and was set by reference to the practices adopted by similar companies.
2 8
ECOGRAF LIMITED ANNUAL REPORT 2022 DIRECTORS'
REPORT
Long-term incentive (LTI)
The LTI incentive arrangements involve the offer of performance rights to eligible participants which are subject to pre-
determined performance conditions that are required to be achieved prior to vesting. The performance conditions are set to
promote achievement of the Company’s key strategic objectives over the long term, with a target rolling performance period
of 3-5 years. Subject to the achievement of the specified performance conditions, upon exercise each performance right will
entitle the eligible participant to receive one ordinary share in the Company. The LTI opportunity for the Managing Director
and Chief Financial Officer is currently 100% of their fixed remuneration and is set by reference to the practices adopted by
similar companies.
4. EXECUTIVE REMUNERATION OUTCOMES
4.1 Financial performance
The table below sets out information about the Company’s results and movements in shareholder value for the past five
years up to and including the current financial year. The historic numbers have not been assessed and adjusted for the
impact of the new accounting standards.
Net loss after tax ($’000)
Share price at end of year ($)
Basic loss per share (cents)
4.2 Fixed remuneration outcomes
30 June
2022
30 June
2021
30 June
2020
(7,505)
0.25
(1.67)
(5,514)
0.57
(1.40)
(2,769)
0.07
(0.91)
30 June
2019
(3,340)
0.12
(1.19)
30 June
2018
(3,764)
0.14
(1.50)
Following the review of executive KMP remuneration levels against relevant market conditions and scope of roles, the
following table outlines fixed remuneration changes (inclusive of superannuation) for executive KMP during the financial year
(where applicable, the fixed remuneration change was effective from 1 April 2022).
Andrew Spinks
Howard Rae
Fixed remuneration
30 June 2022
Fixed remuneration
30 June 2021
$355,875
$400,000
$355,875
$355,875
4.3 Equity-based variable/at risk remuneration outcomes
A total of 641,650 performance rights were issued to executive KMP during the financial year in relation to STI awards for the
performance period to 30 June 2021, being the first year of the STI plan.
No performance rights were issued to executive KMP under LTI arrangements during the year ended 30 June 2022 (2021:
3,550,000).
5. EXECUTIVE KMP EMPLOYMENT AGREEMENTS
The remuneration and other conditions of employment of executives are formalised in employment contracts that specify
duties and obligations to be fulfilled and provide for an annual review of remuneration. Executive KMP termination notice
periods and payment provisions are as follows:
Andrew Spinks
Howard Rae
Resignation
6 months
3 months
Termination
for cause
Termination in case of death, disablement,
redundancy or notice without cause
Termination
payment
None
1 month
1 month
3 months
3 months
3 months
2 9
ECOGRAF LIMITED ANNUAL REPORT 2022 DIRECTORS' REPORT
6. NON-EXECUTIVE DIRECTOR REMUNERATION
6.1 Fees
Non-executive director fees are set to attract and retain persons with the experience and skills necessary to oversee the
Company’s business activities and to guide its growth and development into a successful mining and mineral processing
company.
The current fee is $110,000 per annum (inclusive of superannuation) for the role of Chairperson and $80,000 per annum
(inclusive of superannuation) for other non-executive directors. Non-executive directors may be paid additional amounts for
special duties or exertions (consultancy services outside of director’s duties) and are entitled to be reimbursed for reasonable
out-of-pocket expenses incurred in the course of their duties.
6.2 Maximum aggregate amount
Total fees payable to all non-executive directors, excluding amounts for special exertion or the reimbursement of reasonable
business expenditures, must not exceed $300,000 per annum, in accordance with the approval provided by shareholders in
2010.
6.3 Equity grants to non-executive directors
From time to time, the Board may approve the grant of equity to non-executive directors, however no performance rights
were issued to non-executive directors during the year ended 30 June 2022 (2021: 2,500,000).
7. STATUTORY REMUNERATION DISCLOSURES
Details of the remuneration of the key management personnel of the consolidated entity are set out in the following table.
Short-term
benefits
Post-
employ-
ment
Long-term
benefits
Share-based
payments
Fees for
special
duties or
exertion
$
Salary/
Fees
$
Super-
annuation
$
Long
Service
Leave
expense
$
Performance
rights
STI
$
LTI
$
Total
$
Equity
% of
compen-
sation
Non-executive directors
Robert Pett
John Conidi
Executives
Andrew
Spinks
Howard Rae
2022
2021
99,917
65,753
2022
80,000
2021
49,275
2022
329,092
2021
295,023
2022
359,825
2021
305,600
Total
remuneration
2022 868,834
2021
715,651
-
-
-
-
-
-
-
-
-
-
10,083
6,941
-
-
27,500
25,000
27,000
24,000
64,583
55,941
-
-
-
-
-
-
-
-
-
110,000
393,750
466,444
-
80,000
393,750
443,025
6,488
1,496
2,823
248
213,349
-
576,429
-
559,125
880,644
213,349
-
602,997
-
559,125
888,973
9,311
426,698
- 1,369,426
1,744
-
1,905,750 2,679,086
0%
84%
0%
89%
37%
63%
35%
63%
31%
71%
3 0
ECOGRAF LIMITED ANNUAL REPORT 2022 DIRECTORS'
REPORT
8. ADDITIONAL DISCLOSURES RELATING TO SHARES AND PERFORMANCE RIGHTS
8.1 Number of shares
Balance at
1 July 2021
Balance at date
of appointment
Movement
during the year
Balance at
30 June 2022
Non-executives
Robert Pett
John Conidi
Executives
Andrew Spinks
Howard Rae
Total
3,454,615 1
3,019,402 2
11,998,822 3
3,150,000 4
21,622,839
-
-
-
-
-
1
Includes 2,000,000 shares issued under the former non-executive director share plan
2 Includes 1,000,000 shares issued under the former non-executive director share plan
3 Includes 2,000,000 shares issued under the former employee share plan
4 Includes 3,000,000 shares issued under the former employee share plan
8.2 Number of incentive performance rights
-
-
-
-
-
3,454,615
3,019,402
11,998,822
3,150,000
21,622,839
Balance at
30 June 2021
Net Change
Balance at
30 June 2022
STI
LTI
STI
LTI
STI
LTI
-
-
-
-
-
1,250,000
1,250,000
-
-
1,775,000
1,775,000
320,825 1
320,825 1
6,050,000
641,650
-
-
-
-
-
-
-
1,250,000
1,250,000
320,825
320,825
1,775,000
1,775,000
641,650
6,050,000
Non-executives
Robert Pett
John Conidi
Executives
Andrew Spinks
Howard Rae
Total
1 Short-term incentive for the year ended 30 June 2021, which was granted on 8 December 2021 and vested 30 June 2022
8.3 Loans to key management personnel
There were no loans granted to key management personnel during the year ended 30 June 2022.
8.4 Other transactions with key management personnel
There were no other transactions with key management personnel of the consolidated entity, including their personally related
parties during the year ended 30 June 2022.
Signed in accordance with a resolution of the directors made pursuant to s298 (2) of Corporations Act 2001.
Andrew Spinks
Managing Director
29 September 2022
3 1
ECOGRAF LIMITED ANNUAL REPORT 2022 AUDITOR'S INDEPENDENCE
DECLARATION
Level 32 Exchange Tower, 2 The Esplanade Perth WA 6000
GPO Box R1253 Perth WA 6844
RSM Australia Partners
T +61 (0) 8 9261 9100
F +61 (0) 8 9261 9111
www.rsm.com.au
AUDITOR’S INDEPENDENCE DECLARATION
As lead auditor for the audit of the financial report of EcoGraf Limited for year ended 30 June 2022, I declare
that, to the best of my knowledge and belief, there have been no contraventions of:
(i)
(ii)
the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
any applicable code of professional conduct in relation to the audit.
RSM AUSTRALIA PARTNERS
Perth, WA
Dated: 29 September 2022
TUTU PHONG
Partner
THE POWER OF BEING UNDERSTOOD
AUDIT | TAX | CONSULTING
RSM Australia Partners is a member of the RSM network and trades as RSM. RSM is the trading name used by the members of the RSM network. Each member of the RSM network is an independent
accounting and consulting firm which practices in its own right. The RSM network is not itself a separate legal entity in any jurisdiction.
RSM Australia Partners ABN 36 965 185 036
Liability limited by a scheme approved under Professional Standards Legislation
3 2
ECOGRAF LIMITED ANNUAL REPORT 2022
FINANCIAL
STATEMENTS
3 3
ECOGRAF LIMITED ANNUAL REPORT 2022NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFor the Year Ended 30 June 2022 CONSOLIDATED STATEMENT OF PROFIT OR
LOSS & OTHER COMPREHENSIVE INCOME
For the Year Ended 30 June 2022
Note
2022
$’000
2021
$’000
Revenue
Interest income
Other income
Expenses
Accounting & audit
Consultants & contractors
Employee benefits
Depreciation
Directors fees
Exploration and evaluation expensed
Information systems & technology
Listing & compliance
Office rental & outgoings
Other
Share based payments
Travel & accommodation
Unrealised foreign exchange differences
Loss before income tax
Income tax expense
Loss after income tax for the year
Total comprehensive loss for the year
Loss attributable to members of EcoGraf Limited
Total comprehensive loss attributable to members of EcoGraf Limited
Loss per share attributable to the members of EcoGraf Limited
Basic loss per share (cents per share)
Diluted loss per share (cents per share)
The above statement should be read in conjunction with the accompanying notes.
191
504
695
(153)
(4,669)
(1,618)
(11)
(190)
(309)
(27)
(204)
(159)
(324)
(483)
(57)
4
79
424
503
(149)
(1,888)
(635)
(14)
(122)
(103)
(25)
(128)
(124)
(133)
(2,693)
(3)
-
(8,200)
(6,017)
(7,505)
-
(7,505)
(7,505)
(7,505)
(7,505)
(1.67)
(1.67)
(5,514)
-
(5,514)
(5,514)
(5,514)
(5,514)
(1.40)
(1.40)
3
4
10
19
5
16
16
3 4
ECOGRAF LIMITED ANNUAL REPORT 2022 CONSOLIDATED STATEMENT
OF FINANCIAL POSITIONS
As at 30 June 2022
Assets
Current assets
Cash and cash equivalents
Other financial assets - term deposits at bank
Other receivables
Prepayments
Total current assets
Non-current assets
Property, plant and equipment
Exploration and evaluation assets
Total non-current assets
Total assets
Liabilities
Current liabilities
Trade and other payables
Employee provisions
Total current liabilities
Non-current liabilities
Employee provisions
Total non-current liabilities
Total liabilities
Net assets
Equity
Contributed equity
Reserves
Accumulated losses
Total equity
Note
2022
$’000
2021
$’000
6
6
7
10
8
9
6,728
40,000
258
295
2,633
50,0001
506
212
47,281
53,351
47
18,403
18,450
55
18,238
18,293
65,731
71,644
2,126
155
2,281
32
32
1,195
97
1,292
22
22
2,313
1,314
63,418
70,330
11
12
13
99,834
8,426
(44,842)
99,837
7,830
(37,337)
63,418
70,330
The above statement should be read in conjunction with the accompanying notes.
1 Restated – refer note 6
3 5
ECOGRAF LIMITED ANNUAL REPORT 2022 CONSOLIDATED STATEMENT
OF CHANGES IN EQUITY
For the Year Ended 30 June 2022
Balance at 30 June 2020
Loss for the year
Other comprehensive income
Total comprehensive loss for the year
Transactions with owners in their capacity
as owners
Shares issued during the year
Share plan shares cancelled/ released
Share based payments
Share issue expense
Balance at 30 June 2021
Loss for the year
Other comprehensive income
Total comprehensive loss for the year
Transactions with owners in their capacity
as owners
Share plan shares cancelled/ released
Share based payments
Share issue expense
Balance at 30 June 2022
Contributed
equity
$’000
Accumulated
losses
$’000
Loan share
reserve
$’000
Share based
payment
reserve
$’000
Total
$’000
49,060
(31,823)
(3,264)
6,649
20,622
-
-
-
(5,514)
-
(5,514)
54,598
(651)
-
(3,170)
99,837
-
-
-
-
-
(3)
-
-
-
-
(37,337)
(7,505)
-
(7,505)
-
-
-
-
-
-
-
1,752
-
-
-
-
-
-
-
2,693
-
(5,514)
-
(5,514)
54,598
1,101
2,693
(3,170)
(1,512)
9,342
70,330
-
-
-
113
-
-
-
-
-
-
483
-
(7,505)
-
(7,505)
113
483
(3)
99,834
(44,842)
(1,399)
9,825
63,418
The above statement should be read in conjunction with the accompanying notes.
3 6
ECOGRAF LIMITED ANNUAL REPORT 2022 CONSOLIDATED STATEMENT
OF CASH FLOWS
For the Year Ended 30 June 2022
Operating Activities
Research and development tax credit received
Payments to suppliers and employees
Net cash flows used in operating activities
Investing Activities
Payments for exploration and evaluation
Interest received
Purchases of fixed assets
Proceeds of disposal of fixed assets
Other financial assets - term deposits at bank
Net cash flows from/(used in) investing activities
Financing Activities
Proceeds from issue of shares
Capital raising costs for issue of shares
Repayment of share plan loans
Net cash flows from financing activities
Net increase in cash and cash equivalents held
Cash and cash equivalents at beginning of the year
Cash and cash equivalents at end of the year
Add: Other financial assets - term deposits at bank
Cash and cash equivalents and other financial assets - term deposits at end
of the year
Note
14
6
6
2022
$’000
504
(6,492)
(5,988)
(165)
138
-
-
10,000
9,973
-
(3)
113
110
4,905
2,633
6,728
40,000
46,728
2021
$’000
374
(2,903)
(2,529)
(199)
2
(7)
58
(50,000)1
(50,146)
54,598
(3,170)
1,101
52,529
(146)
2,779
2,633
50,000
52,633
The above statement should be read in conjunction with the accompanying notes.
1 Restated – refer note 6
3 7
ECOGRAF LIMITED ANNUAL REPORT 2022 NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
For the Year Ended 30 June 2022
1. Company Information
The consolidated financial statements of EcoGraf Limited and its subsidiaries (collectively, “the consolidated entity”) for the
year ended 30 June 2022 were authorised for issue in accordance with a resolution of the directors on 29 September 2022.
EcoGraf Limited (“the Company” or “the parent”) is a for profit company limited by shares incorporated in Australia whose
shares are publicly traded on the Australian Securities Exchange. It has activities in Australia and Tanzania, with the country of
domicile being Australia and the registered office located in Australia.
The nature of the operations and principal activities of the consolidated entity are described in the directors’ report.
Information on the consolidated entity’s structure is provided in note 22 and details of other related party relationships is
provided in note 21.
2. Basis of Preparation
The financial report is a general-purpose financial report, which has been prepared in accordance with the requirements
of the Corporations Act 2001, Australian Accounting Standards, and other authoritative pronouncements of the Australian
Accounting Standards Board.
The financial report has been prepared on a historical cost basis.
The financial report complies with International Financial Reporting Standards (IFRS) as issued by the International Accounting
Standards Board.
Functional and presentational currency
These consolidated financial statements are presented in Australian dollars, which is the consolidated entity’s functional
currency. All amounts have been rounded to the nearest thousand, unless otherwise stated in accordance with ASIC
Corporations (Rounding In Financial/Directors’ Reports) Instrument 2016/191.
3. Other Income
Research and development tax credit
Government COVID-19 cash boost
2022
$’000
2021
$’000
504
-
504
374
50
424
3 8
ECOGRAF LIMITED ANNUAL REPORT 2022 4. Consultants and Contractors
Downstream processing research, development and engineering
Fees to finance advisors
Legal
Public relations
Other
2022
$’000
3,090
202
582
278
517
4,669
2021
$’000
1,235
20
122
179
332
1,888
5. Income Tax Expense
Reconciliation of tax benefit/expense and the accounting loss multiplied by Australia’s
domestic tax rate:
Accounting loss before tax
(7,505)
(5,514)
At Australia’s statutory income tax rate of 30.0% (2021: 30.0%)
Tax effect of amounts not deductible/ assessable
Benefit of tax losses and timing differences not brought to account as an asset
Income tax expense attributable to entity
Deferred income tax at balance date relates to the following:
Deferred tax assets
Tax losses available to offset against future taxable income
Total deferred tax asset
Deferred tax liabilities
Exploration and evaluation assets
Deferred tax asset used to offset deferred tax liability
Net deferred tax assets not brought to account
(2,252)
(6)
2,258
-
13,428
13,428
(5,521)
5,521
-
7,907
(1,654)
(48)
1,702
-
9,929
9,929
(5,471)
5,471
-
4,458
The benefit of deferred tax assets not brought to account will only be recognised if:
• Future assessable income is derived of a nature and of an amount sufficient to enable the benefit to be realised
• The conditions for deductibility imposed by tax legislation continue to be complied with
• No changes in tax legislation adversely affect the consolidated entity in realising the benefit.
3 9
ECOGRAF LIMITED ANNUAL REPORT 2022NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFor the Year Ended 30 June 2022 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
6. Cash and Cash Equivalents and Other Financial Assets
Cash at bank and on hand
Other financial assets - term deposits at bank
Restatement
Current Assets - Cash and Cash Equivalents
Balance reported
Reclassification of term deposits
Restated balance
Current Assets - Other Financial Assets
Balance reported
Reclassification of term deposits
Restated balance
2022
$’000
6,728
6,728
40,000
40,000
2021
$’000
2,6331
2,633
50,0001
50,000
52,633
(50,000)
2,633
-
50,000
50,000
1
Restatement of the 30 June 2021 balance to reclassify term deposits of maturity term in excess of 3 months. These deposits may be redeemed to cash with
31 days notice, if required. The term deposits at 30 June 2022 totalled $40 million (2021: $50 million).
7. Other Receivables
Goods and services tax receivable 1
Interest on term deposit
Security deposits
1
Non-interest bearing and generally on 14-day terms at the end of each quarter.
8. Exploration and Evaluation Asset
Exploration and evaluation expenditure carried forward:
Carrying amount as at 1 July
Capitalised expenditure at cost
162
55
41
258
388
77
41
506
18,238
165
18,403
18,039
199
18,238
Recoverability of the carrying amount of exploration and evaluation assets is dependent on the successful development and
commercial exploitation of areas of interest and the sale of minerals, or the sale of the respective areas of interest. The Company
is in discussion with the Government of Tanzania with respect to regulatory arrangements and approvals for the development of
the Epanko Graphite Project, including mining licence conditions past due for the commencement of regular production. On 4
September 2018, the Mining Commission confirmed to the Company that it will be ready to renew the mining licence upon expiry
of the licence period in 2025, provided that the requirements of section 53 of the Mining Act 2010 are fulfilled.
9. Trade and Other Payables
Trade payables 1
Accrued expenses
1
Trade creditors are non-interest bearing and are normally settled on 30-day terms.
1,947
179
2,126
714
481
1,195
4 0
ECOGRAF LIMITED ANNUAL REPORT 2022 Plant &
equipment
office
$’000
Plant &
equipment
field
$’000
Motor
Vehicles
$’000
Furniture &
equipment
$’000
Leasehold
assets
$’000
10. Property, Plant and Equipment
At cost
46
Accumulated depreciation
Net carrying amount
(27)
19
21
(19)
2
67
(50)
17
33
(28)
5
8
(4)
4
Total
$’000
175
(128)
47
Movement in the carrying amounts for each class of property, plant and equipment between the beginning and the end of
the current financial year, is as follows:
Balance at 30 June 2020
Additions
Disposals
Depreciation expense
Balance at 30 June 2021
Additions
Disposals
Depreciation expense
Balance at 30 June 2022
12
7
(1)
(4)
14
9
-
(4)
19
6
-
-
(2)
4
-
(1)
(1)
2
114
-
(85)
(6)
23
-
(1)
(5)
17
11
-
-
(1)
10
-
(4)
(1)
5
5
-
-
(1)
4
-
-
-
4
148
7
(86)
(14)
55
9
(6)
(11)
47
11. Contributed Equity
450,333,459 (2021: 449,833,459) fully paid ordinary shares
a) Ordinary shares
Balance at 30 June 2020
Plan shares expired - July 2020
Share placement - February 2021
Plan shares expired - April 2021
Incentive performance rights plan shares issued - June 2021
Capital raising costs
Balance at 30 June 2021
Incentive performance rights plan shares issued - September 2021
Incentive performance rights plan shares issued – November 2021
Capital raising costs
Balance at 30 June 2022
Fully paid ordinary shares carry one vote per share and carry a right to dividends.
2022
$’000
2021
$’000
99,834
99,837
$’000
No. of shares
49,060
363,986,768
(651)
(3,750,000)
54,598
90,996,691
-
-
(2,000,000)
600,000
(3,170)
-
99,837
449,833,459
-
-
(3)
100,000
400,000
-
99,834
450,333,459
4 1
ECOGRAF LIMITED ANNUAL REPORT 2022NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFor the Year Ended 30 June 2022 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
12. Reserves
Share based payment reserve
Loan share reserve
Movement in share-based payment reserve
Balance at beginning of year
Share based payments
Balance at end of year
Movement in loan plan share reserve
Balance at beginning of year
Plan shares expired/ released
Balance at end of year
Share based payments reserve
2022
$’000
2021
$’000
9,825
(1,399)
8,426
9,342
483
9,825
(1,512)
113
(1,399)
9,342
(1,512)
7,830
6,649
2,693
9,342
(3,264)
1,752
(1,512)
The reserve recognises the value of equity provided as remuneration to employees and also to other parties as
compensation for services provided to the consolidated entity.
Plan share reserve
The reserve represents the non-cash nominal value of loan shares on issue to employees and is deducted from equity.
13. Accumulated Losses
Balance at beginning of year
Loss for the year
Balance at end of year
14. Cash Flow Information
Reconciliation of cash flow from operations with loss for the year
Loss for the year
Adjustments for:
Interest income
Depreciation
Loss on disposal of fixed assets
Share based payment expensed
Changes in assets and liabilities:
(Increase) / decrease in Other receivables
Increase / (decrease) in Trade and other payables
Increase / (decrease) in Employee provisions and payables
(37,337)
(7,505)
(44,842)
(31,823)
(5,514)
(37,337)
(7,505)
(5,514)
(191)
11
(3)
483
218
1,015
(16)
(79)
14
28
2,693
(525)
812
42
Net cash flows used in operating activities
(5,988)
(2,529)
4 2
ECOGRAF LIMITED ANNUAL REPORT 2022 15. Expenditure Commitments, Contingent Assets/ Contingent Liabilities
Mineral tenements
In order to maintain current rights of tenure to exploration tenements, the consolidated entity is required to outlay rentals
and to satisfy minimum expenditure requirements of $1,797,559 (2021: $486,188) over the next 12 months, in accordance with
agreed work programs submitted over the Company’s exploration licences. Financial commitments for subsequent periods
are contingent upon future exploration results.
There are no contingent assets or liabilities at 30 June 2022 or 30 June 2021.
16. Loss Per Share
Data used in the basic loss per share computations:
Loss for the year
Weighted average number of ordinary shares
Basic and diluted loss per share (cents)
2022
$’000
2021
$’000
(7,505)
(5,514)
450,164,144
394,298,531
(1.67)
(1.40)
Loss per share is calculated by dividing the loss for the year attributable to ordinary equity holders of the Company by the
weighted average number of ordinary shares outstanding during the year.
17. Auditor’s Remuneration
Fees to RSM Australia Partners
Fees for auditing the statutory financial reports of the consolidated entity
Fees for assurance services that are required by legislation to be provided
by the auditor
Total fees to RSM Australia Partners
Fees to other overseas member firms of RSM Australia Partners
Fees for auditing the financial report of any controlled entities
Fees for other services
- Tax compliance
Total fees to overseas member firms of RSM Australia Partners
54
2
56
-
-
-
38
2
40
-
-
-
Total auditor’s remuneration
56
40
4 3
ECOGRAF LIMITED ANNUAL REPORT 2022NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFor the Year Ended 30 June 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
18. Segment information
The consolidated entity reports one segment, graphite products, to the chief operating decision maker, being the Managing
Director for the purposes of assessing performance and determining the allocation of resources.
Unless otherwise stated, all amounts reported to the chief operating decision maker are determined in accordance with
accounting policies that are consistent with those adopted in this financial report.
Revenue by geographical region
2022 Results
Segment other income
Segment expenses
Accounting and audit
Consultants and contractors
Employee benefits
Depreciation
Directors’ fees
Exploration and evaluation expensed
Information systems and technology
Listing and compliance
Office rental and outgoings
Other
Share based payments
Travel and accommodation
Foreign exchange gain/(loss)
Segment results
Australia
$’000
Tanzania
$’000
Consolidated
$’000
695
-
695
(147)
(4,533)
(1,618)
(4)
(190)
-
(25)
(204)
(157)
(250)
(483)
(58)
(17)
(6)
(136)
-
(7)
-
(309)
(2)
-
(2)
(72)
-
(1)
21
(153)
(4,669)
(1,618)
(11)
(190)
(309)
(27)
(204)
(159)
(322)
(483)
(59)
4
(6,991)
(514)
(7,505)
4 4
ECOGRAF LIMITED ANNUAL REPORT 2022 18. Segment information
Revenue by geographical region
2021 Results
Segment other income
Segment expenses
Accounting and audit
Consultants and contractors
Employee benefits
Depreciation
Directors fees
Exploration and evaluation expensed
Information systems and technology
Listing and compliance
Office rental and outgoings
Other
Share based payments
Travel and accommodation
Unrealised foreign exchange loss
Segment results
Assets by geographical region
2022 Assets
Property, plant and equipment
Exploration and evaluation assets
Segment non-current assets
Unallocated assets:
Cash and cash equivalents
Other financial assets - term deposits at bank
Other receivables
Prepayments
Total assets
2022 Liabilities
Segment liabilities
Total liabilities
4 5
Australia
$’000
Tanzania
$’000
Consolidated
$’000
503
(146)
(1,757)
(635)
(4)
(122)
-
(21)
(128)
(120)
(85)
(2,693)
(2)
-
(5,713)
(5,210)
-
503
(3)
(131)
-
(10)
-
(103)
(4)
-
(4)
(48)
-
(1)
-
(304)
(304)
(149)
(1,888)
(635)
(14)
(122)
(103)
(25)
(128)
(124)
(133)
(2,693)
(3)
-
(6,017)
(5,514)
Australia
$’000
Tanzania
$’000
Consolidated
$’000
21
-
21
26
18,403
18,429
(2,281)
(32)
47
18,403
18,450
6,728
40,000
258
295
65,731
(2,313)
(2,313)
ECOGRAF LIMITED ANNUAL REPORT 2022NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFor the Year Ended 30 June 2022 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
Australia
$’000
Tanzania
$’000
Consolidated
$’000
16
-
16
39
18,238
18,277
(1,301)
(13)
55
18,238
18,293
2,633
50,0001
506
212
71,644
(1,314)
(1,314)
Assets by geographical region
2021 Assets
Property, plant and equipment
Exploration and evaluation assets
Segment non-current assets
Unallocated assets:
Cash and cash equivalents
Other financial assets - term deposits at bank
Other receivables
Prepayments
Total assets
2021 Liabilities
Segment liabilities
Total liabilities
1 Restated – refer note 6
19. Share Based Payments
Incentive Performance Rights Plan
The shareholder approved Incentive Performance Rights Plan is designed to assist with the recruitment, reward, retention
and incentivisation of key personnel who possess the skills and experience to enable the Company to develop its graphite
businesses and grow long-term shareholders value.
The Company is at a critical stage in its growth as it advances the new EcoGraf™ Battery Anode Material Facility and Epanko
Graphite Mine to development and operations. The international graphite industry is also evolving rapidly to support the demand
for lithium-ion batteries in electric vehicles and the retention of specialised skills is essential to the Company's future success.
To achieve this outcome, the Company believes that incentivising and rewarding performance and the achievement of key
objectives through equity arrangements is the most effective remuneration structure because it preserves the Company's cash
reserves and aligns the interests of personnel with those of all shareholders.
Short-Term Incentive
Under the short-term incentive arrangements, eligible participants may earn performance rights for the achievement of
pre-determined key performance measures each year, with the determination of the amount, if any, made after the end of
each year, by multiplying the individual’s assessed key performance score by the applicable percentage of their fixed annual
remuneration. The number of performance rights, if any, to be earned under the short-term incentive is calculated by dividing
the short-term incentive amount by the volume weighted average price of the Company’s shares during the applicable
financial year. To promote alignment and retention, if any performance rights are allocated, the individual will not be able to
dispose of the shares received on exercise of the performance rights for a period of 12 months from the end of the financial
year for which they were awarded. Upon exercise, each performance right will entitle the eligible participant to receive one
ordinary share in the Company.
Long-Term Incentive
The long-term incentive arrangements involve the offer of performance rights to eligible participants which are subject to
pre-determined performance conditions that are required to be achieve prior to vesting. The performance conditions are set
to promote achievement of the Company’s key strategic objectives. Subject to the achievement of the specified performance
conditions, upon exercise each performance right will entitle the eligible participant to receive one ordinary share in the
Company. The number of performance rights offered to an individual is determined by reference to equity incentives offered
by similar companies and the potential for the individual, through their position, skills and experience, to create long-term
shareholder value.
4 6
ECOGRAF LIMITED ANNUAL REPORT 2022 19. Share Based Payments (continued)
During the year ended 30 June 2022 a total of 1,641,650 performance rights were granted. (2021: 8,550,000).
The following table illustrates the number and weighted average exercise prices (WAEP) of, and movements in, incentive
performance rights during the year:
Outstanding at 1 July
Granted during the year
Forfeited during the year
Vested during the year
Issued during the year
Expired during the year
Outstanding at 30 June
2022
Number
7,950,000
1,641,650
-
2022
WAEP
0.3150
0.6650
-
2021
Number
-
8,550,000
-
641,650
0.6650
8,550,000
(500,000)
(0.3150)
(600,000)
-
-
-
2021
WAEP
-
0.3150
-
0.3150
0.3150
-
9,091,650
0.3782
7,950,000
0.3150
Valuation: Share Based Payment Expense
For the performance rights granted during the current financial year, the valuation model inputs used to determine the fair
value at the grant date, are as follows:
Grant date
Expiry date
Share price at grant date
Vesting date
Expected volatility
Dividend yield
Risk-free rate
Number of performance rights
Fair value for each right
Amount recognised as share-based payment expense
Share Plans
08/12/2021
08/12/2021
07/12/2027
07/12/2026
$0.665
$0.665
30/06/2022
Not vested
120%
Nil
0.550%
641,650
$0.665
$426,697
120%
Nil
1.365%
1,000,000
$0.665
$55,993
Plan shares are issued to directors and employees in recognition of their performance with the Company and as incentive
remuneration under the respective director and employee share plans (together the “Share Plans”). The terms and conditions
of the Share Plans are identical, other than in respect of who is eligible to participate in each plan. Plan shares are issued at
the discretion of the Board.
Under the Share Plans, eligible directors and employees are offered plan shares in the Company at prices determined by the
Board, which has the discretion to impose conditions on the shares issued under the Share Plans and may also grant a loan,
in the form of a non-cash credit facility, to a participant for the purposes of subscribing for plan shares. Shares issued via loan
facility may not be granted at less than the volume weighted average price of the Company’s shares during the 5 trading
days up to and including the date of acceptance and are escrowed as security until the loan has been fully repaid, via cash
payment and/or the sale of the plan shares. If the loan is repaid by the sale of shares, any surplus on sale is remitted to the
participant and any shortfall is borne by the consolidated entity.
There were no plan shares issued during the year ended 30 June 2022 (2021: Nil).
4 7
ECOGRAF LIMITED ANNUAL REPORT 2022NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFor the Year Ended 30 June 2022 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
The following table illustrates the number and weighted average exercise prices (WAEP) of, and movements in, plan shares
during the year:
Outstanding at 1 July
Granted during the year
Forfeited during the year
Exercised during the year
Expired during the year
Outstanding at 30 June
2022
Number
2022
WAEP
2021
Number
2021
WAEP
9,500,000
0.1590
18,250,000
0.1789
-
-
-
-
-
-
(750,000)
0.1509
(5,000,000)
-
-
(3,750,000)
8,750,000
0.1597
9,500,000
-
-
0.2205
0.1736
0.1590
20. Directors and Key Management Personnel Disclosures
a) Names and positions of key management personnel in office at any time during the financial year:
Robert Pett
John Conidi
Andrew Spinks
Howard Rae
Non-Executive Chairman
Non-Executive Director
Managing Director
Chief Financial Officer and Joint Company Secretary
b) Key management personnel remuneration
Aggregate compensation of key management personnel of the consolidated entity:
Short term employee benefits
Post-employment benefits
Long term employee benefits
Share based payments (non-cash)
2022
$’000
868
65
9
427
1,369
2021
$’000
715
56
2
1,906
2,679
Detailed information about the remuneration received by key management personnel is provided in the remuneration report
on pages 26 to 31.
21. Related Party Disclosures
Transactions between related parties are on normal commercial terms.
Ultimate parent
EcoGraf Limited is the parent entity.
Subsidiaries
Interests in subsidiaries are set out in note 22.
Key management personnel
Disclosures relating to key management personnel are set out in note 20 and the remuneration report in the directors’ report.
Transactions with related parties
There were no related party transactions during the year ended 30 June 2022 (2021: Nil)
4 8
ECOGRAF LIMITED ANNUAL REPORT 2022 22. Consolidated Entity Information
Information about subsidiaries
The financial statements of the consolidated entity include the following subsidiaries:
Tanzanian Exploration Company Pty Ltd
TanzGraphite Pty Ltd
TanzGraphite (AUS) Pty Ltd
EcoGraf (Australia) Pty Ltd
Westoz Technologies Pty Ltd
Innogy Limited
Innogy Minerals Holdings Pty Ltd
Innogy Minerals (UK) Pty Ltd
EcoGraf (Mauritius) Limited
EcoGraf (Tanzania) Limited
TanzGraphite (TZ) Limited
Innogy Minerals (TZ) Limited
Frontier Minerals (TZ) Limited
TanzGraphite Technologies Limited1
TanzGraphite Exploration (TZ) Limited1
1 Deregistered
Country of incorporation
2022
2021
Percentage owned (%)
Australia
Australia
Australia
Australia
Australia
Australia
Australia
United Kingdom
Mauritius
Tanzania
Tanzania
Tanzania
Tanzania
Tanzania
Tanzania
100
100
100
100
100
100
100
100
100
100
100
100
100
-
-
100
100
100
100
100
-
-
-
100
100
100
-
-
100
100
4 9
ECOGRAF LIMITED ANNUAL REPORT 2022NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFor the Year Ended 30 June 2022 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
23. Parent Information
EcoGraf Limited
Current assets
Non-current assets
Total assets
Current liabilities
Non-current liabilities
Total liabilities
Net assets
Equity
Contributed equity
Share based payment reserve
Loan share reserve
Accumulated losses
Total equity
Loss of the parent entity
Total comprehensive loss of the parent entity
Guarantees entered into by the parent entity in relation to the debts of its subsidiaries
The parent entity did not have any guarantees at 30 June 2022 or 30 June 2021.
Contingent liabilities
The parent entity did not have any contingent liabilities at 30 June 2022 or 30 June 2021.
Capital commitments
The parent entity did not have any capital commitments at 30 June 2022 or 30 June 2021.
2022
$’000
47,236
18,463
65,699
(2,249)
(32)
(2,281)
63,418
99,834
9,825
(1,399)
(44,842)
63,418
(7,505)
(7,505)
2021
$’000
53,311
18,320
71,631
(1,281)
(20)
(1,301)
70,330
99,837
9,342
(1,512)
(37,337)
70,330
(5,210)
(5,210)
Significant accounting policies
The parent entity’s financial information has been prepared using the same basis, including the accounting policies, as the
consolidated entity.
5 0
ECOGRAF LIMITED ANNUAL REPORT 2022 24. Financial Instruments
The consolidated entity is exposed to a variety of financial risks, including market risk, credit risk and liquidity risk.
The consolidated entity’s financial instruments consist of cash and deposits with banks, accounts receivable and accounts
payable. No trading in any financial instruments is undertaken.
Details of the significant accounting policies and methods adopted, including the criteria for recognition, the basis of
measurement and the basis on which income and expense are recognised, in respect of each class of financial asset,
financial liability and equity instrument, are disclosed in note 26. Unless otherwise stated, the carrying amounts of financial
instruments reflect their fair value.
The main risks arising from the consolidated entity’s financial instruments are foreign currency risk, interest rate risk, liquidity
risk and credit risk. The Board determines policies for managing each of these risks and they are summarised below.
Foreign currency risk
The consolidated entity undertakes certain transactions denominated in foreign currency and is exposed to foreign currency
risk through foreign exchange rate fluctuations. Foreign exchange risk also arises from future commercial transactions and
recognised financial assets and financial liabilities denominated in a currency other than the consolidated entity’s functional
currency. The consolidated entity operates internationally and is exposed to foreign exchange risk arising from currency
exposures to the USD, EUR, TZS and GBP.
The carrying amount, in Australian dollars of the consolidated entity’s foreign currency denominated financial assets and
financial liabilities at the reporting date was as follows:
USD
EUR
TZS
GBP
Total
Cash and cash equivalents
Trade and other payables
2022
$’000
2021
$’000
2022
$’000
2021
$’000
19
-
3
-
22
28
-
7
-
35
63
9
15
107
194
7
5
-
88
100
The financial impact of a 10% change in the Australian dollar exchange rate on the consolidated entity is as follows:
Appreciation in AUD exchange rate
Depreciation in AUD exchange rate
%
change
Effect on loss
before tax
Effect on
equity
%
change
Effect on loss
before tax
Effect on
equity
2022
2021
10%
10%
$12,203
$6,841
$12,203
$6,841
10%
10%
$(12,203)
$(6,841)
$(12,203)
$(6,841)
The assumed percentage change used in the above analysis is the expected overall volatility of the significant currencies,
which is based on management’s assessment of reasonable possible fluctuations, taking into consideration movements
during the year and the spot rate at each reporting date.
Interest rate risk
The consolidated entity’s exposure to market risk for changes in interest rates arises from holding cash and deposits. Funds
held in operating accounts and term deposits earned variable interest at rates ranging between 0% to 3.01% (2021: 0% to
0.45%), depending on the type of bank account and cash balance. The consolidated entity does not have interest-bearing
loans or borrowings.
5 1
ECOGRAF LIMITED ANNUAL REPORT 2022NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFor the Year Ended 30 June 2022 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
The interest-bearing financial instruments held by the consolidated entity are:
Cash and cash equivalents
Other financial assets - term deposits at bank
30 June
2022
$’000
6,728
40,000
46,728
30 June
2021
$’000
2,633
50,0001
52,633
A change of 1% in the variable interest rate at the reporting date would have an impact on the consolidated entity profit and
loss and equity of $467,000 (2021: $526,000) assuming all other variables remain constant.
1 Restated – refer note 6
Liquidity risk
Liquidity risk is the risk that the consolidated entity will not be able to meet its financial obligations as and when they fall due.
The consolidated entity manages liquidity risk by maintaining adequate cash reserves, by continuously monitoring actual and
forecast cash flows and by matching the maturity profiles of its financial assets and liabilities.
The following table sets out the contractual maturity of the consolidated entity’s financial instrument liabilities based on
undiscounted cash flows.
Carrying
amount
$’000
Contractual
cash flows
$’000
1 year or
less
$’000
Between 1
and 2 years
$’000
Between 2
and 5 years
$’000 s
Over 5
years
$’000
2022
Trade and other payables
2,126
2,126
2,126
2021
Trade and other payables
1,195
1,195
1,195
-
-
-
-
-
-
Credit risk management
Credit risk is the risk that a counterparty will default on its contractual obligations resulting in a financial loss to the
consolidated entity. The consolidated entity is exposed to credit risk from its bank deposits and other receivables as
disclosed in the statement of financial position. The consolidated entity does not have any significant credit risk exposure to
any single counterparty or any consolidated entity of counterparties having similar characteristics.
The credit risk on liquid funds is managed through the use of counterparty banks with acceptable credit-ratings assigned by
international credit-rating agencies. (S+P Australian AA-, Tanzanian B).
Holdings by geographical region
Cash and cash equivalents
Other financial assets - term deposits at bank
Other receivables
Australia
$’000
Tanzania
$’000
6,684
40,000
258
46,942
44
-
-
44
Total
$’000
6,728
40,000
258
46,986
The maximum exposure to credit risk at the reporting date is the carrying value of each class of financial assets disclosed in
notes 6 and 7.
Fair value measurement
The carrying amounts of Other receivables and Trade and other payables are assumed to approximate their fair values due to
their short-term nature.
5 2
ECOGRAF LIMITED ANNUAL REPORT 2022 25. Events After Balance Date
There have been no events that have arisen between 30 June 2022 and the date of this report or any other item, transaction
or event of a material and unusual nature likely, in the opinion of the directors, to materially affect the operations of the Group,
the results of those operations or the state of affairs of the Group, in future financial years.
26. Significant Accounting Policies
a) Parent entity information
In accordance with the Corporations Act 2001, these financial statements present the results of the consolidated entity only,
and information about the parent entity is disclosed in note 23.
b) Basis of consolidation
The consolidated financial statements comprise the financial statements of the Company and its subsidiaries as at
30 June 2022. Subsidiaries are entities that are controlled by the Company. Control is achieved when the Company is
exposed to, or has rights to, variable returns from its involvement with its subsidiaries and has the ability to affect those
returns through its capacity to direct the activities of its subsidiaries.
Specifically, the consolidated entity controls a subsidiary if, and only if, the consolidated entity has:
• power over the subsidiary (i.e., existing rights that give it the current ability to direct the relevant activities of the subsidiary)
• exposure, or rights, to variable returns from its involvement with the subsidiary
• the ability to use its power over the subsidiary to affect its returns
Generally, there is a presumption that a majority of voting rights results in control. To support this presumption and when the
consolidated entity has less than a majority of the voting or similar rights of an subsidiary, the consolidated entity considers all
relevant facts and circumstances in assessing whether it has power over a subsidiary, including:
• the contractual arrangement(s) with the other vote holders of the subsidiary
• rights arising from other contractual arrangements
• the consolidated entity’s voting rights and potential voting rights.
The consolidated entity re-assesses whether or not it controls an entity if facts and circumstances indicate that there is a
change to the elements of control. Assets, liabilities, income and expenses of a subsidiary acquired or disposed of during the
year are included in the consolidated financial statements from the date the consolidated entity gains control until the date
the consolidated entity ceases to control the subsidiary.
When necessary, adjustments are made to the financial statements of subsidiaries to align to their accounting policies with
the consolidated entity. All consolidated entity assets and liabilities, equity, income, expenses and cash flows relating to
transactions between members of the consolidated entity are eliminated in full on consolidation.
A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an equity transaction.
c) Taxes
Current income tax
Current income tax assets and liabilities are measured at the amount expected to be recovered from or paid to the taxation
authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted at
the reporting date in the countries where the consolidated entity operates and generates taxable income.
5 3
ECOGRAF LIMITED ANNUAL REPORT 2022NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFor the Year Ended 30 June 2022 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
Current income tax relating to items recognised directly in equity is recognised in equity and not in the statement of profit or
loss. Management periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax
regulations are subject to interpretation and establishes provisions where appropriate.
Deferred tax
Deferred tax liabilities are provided using the liability method on temporary differences between the tax bases of assets
and liabilities and their carrying amounts for financial reporting purposes at the reporting date. Deferred tax liabilities are
recognised for all taxable temporary differences, except:
•
•
when the deferred tax liability arises from the initial recognition of goodwill or an asset or liability in a transaction that is not
a business combination and at the time of the transaction, it affects neither the accounting profit nor taxable profit or loss; or
in respect of taxable temporary differences associated with investments in subsidiaries, associates and interests in joint
arrangements, when the timing of the reversal of the temporary differences can be controlled and it is probable that the
temporary differences will not reverse in the foreseeable future.
Deferred tax assets are recognised for all deductible temporary differences, the carry forward of unused tax credits and any
unused tax losses. Deferred tax assets are recognised to the extent that it is probable that taxable profit will be available
against which the deductible temporary differences and the carry forward of unused tax credits and unused tax losses can be
utilised, except:
•
•
when the deferred tax asset relating to the deductible temporary difference arises from the initial recognition of an
asset or liability in a transaction that is not a business combination and at the time of the transaction, it affects neither the
accounting profit nor taxable profit or loss
in respect of deductible temporary differences associated with investments in subsidiaries, associates and interests
in joint arrangements, deferred tax assets are recognised only to the extent that it is probable that the temporary
differences will reverse in the foreseeable future and taxable profit will be available against which the temporary
differences can be utilised.
The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer
probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilised. Unrecognised
deferred tax assets are re-assessed at each reporting date and are recognised to the extent that it has become probable that
future taxable profits will allow the deferred tax asset to be recovered.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is
realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the
reporting date.
Deferred tax assets and deferred tax liabilities are offset if a legally enforceable right exists to set off current tax assets
against current tax liabilities and the deferred taxes relate to the same taxable entity and the same taxation authority.
5 4
ECOGRAF LIMITED ANNUAL REPORT 2022 26. Significant Accounting Policies (continued)
d) Exploration and development expenditure
Exploration and evaluation expenditure in relation to separate areas of interest for which rights of tenure are current is
carried forward as an asset in the statement of financial position where it is expected that the expenditure will be recovered
through the successful development of an area of interest, or by its sale, or exploration activities are continuing in an area
and activities have not reached a stage which permits a reasonable estimate of the existence or otherwise of economically
recoverable reserves.
Where a project or an area of interest has been abandoned, the expenditure incurred thereon is written-off in the year in
which the decision 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. (Refer to note 26g).
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 plant, equipment and building structures,
waste removal and rehabilitation of the site in accordance with the permits. Such costs are determined using estimates of
future costs, current legal requirements and applicable technology on a discounted basis.
Payments for exploration and evaluation expenditure are recorded net of any government grants.
e) Operating segments
Operating segments are presented on the same basis as the internal reports provided to the chief operating decision maker
who is responsible for the allocation of resources to operating segments and for assessing their performance.
f) Property plant & equipment
Each class of property, plant and equipment is carried at cost less, where applicable, any accumulated depreciation and
impairment losses.
Property plant & equipment is recorded at the value directly attributable to bringing the asset to the location and condition
necessary for it to be capable of operating in the manner intended by management.
Plant and equipment
The carrying amount of plant and equipment is reviewed annually by directors to ensure it is not in excess of the amounts
recoverable on the basis of net cash flows that are expected to be received from the employment and subsequent disposal
of the assets.
Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it
is probable that future economic benefits associated with the item will flow to the consolidated entity and the cost of the item
can be measured reliably. Repairs and maintenance expenses are charged to the profit and loss during the financial period in
which they are incurred.
5 5
ECOGRAF LIMITED ANNUAL REPORT 2022NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFor the Year Ended 30 June 2022 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
Depreciation
The depreciable amount of all fixed assets including any buildings and capitalised lease assets, but excluding freehold land,
is depreciated on a straight-line basis over their useful lives, commencing from the time the asset is held ready for use as
follows:
Plant and equipment office
Plant and equipment field
Motor vehicles
Furniture and equipment
Leasehold assets
8 years
2–5 years
5 years
4 years
3 years
Residual values of the assets and their useful lives are reviewed and if necessary adjusted, at each reporting date.
An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater
than its estimated recoverable amount.
Gains and losses on disposals are determined by comparing proceeds with the carrying amount and are included in the profit
and loss component of the statement of comprehensive income.
g)
Impairment of non-financial assets
At each reporting date, the consolidated entity reviews the carrying values of its tangible and intangible assets to
determine whether there is any indication that those assets have been impaired. If such an indication exists, the
recoverable amount of the asset, being the higher of the asset’s fair value less costs to sell and value in use, is compared
to the asset’s carrying value. Any excess of the asset’s carrying value over its recoverable amount is expensed to the profit
or loss component of the consolidated statement of profit or loss and other comprehensive income.
Impairment testing is performed annually for goodwill and intangible assets with indefinite lives.
Where it is not possible to estimate the recoverable amount of an individual asset, the entity estimates the recoverable
amount of the cash-generating unit to which the asset belongs.
h) Foreign currency transactions and balances
Transactions and balances
Foreign currency transactions are translated into Australian dollars using the exchange rates prevailing at the date of
the transaction and foreign currency monetary items are translated at the year-end exchange rate. Non-monetary items
measured at historical cost continue to be carried at the exchange rate at the date of the transaction and non-monetary items
measured at fair value are reported at the exchange rate at the date when fair values were determined.
Exchange differences arising on the translation of monetary items are recognised in the profit or loss component of the
statement of profit or loss and other comprehensive income, except where they are deferred in equity as a qualifying cash
flow or net investment hedge.
Subsidiaries
On consolidation, the assets and liabilities of foreign operations are translated into Australian dollars at the exchange rate
prevailing at the reporting date and their statements of profit or loss are translated at exchange rates prevailing at the dates
of the transactions. Exchange differences arising on translation for consolidation are recognised in other comprehensive
income. On disposal of a foreign operation, the component of other comprehensive income relating to that particular foreign
operation is recognised in the profit or loss.
5 6
ECOGRAF LIMITED ANNUAL REPORT 2022 26. Significant Accounting Policies (continued)
i)
Employee benefits
Provision is made for the consolidated entity’s liability for employee benefits arising from services rendered by employees up
to reporting date. Short term employee benefits have been measured at the amounts expected to be paid when the liability is
settled, plus related on-costs. Long term employee benefits have been measured at the present value of the estimated future
cash outflows to be made for those benefits.
Share-based payments
Equity-settled share-based compensation benefits are provided to employees and directors.
The cost of equity-settled transactions is measured at fair value on grant date. Fair value is independently determined using
either the binomial or Black-Scholes option pricing model that takes into account the exercise price, the term of the option,
the impact of dilution, the share price at grant date and expected price volatility of the underlying share, the expected
dividend yield, and the risk-free interest rate for the term of the option, together with non-vesting conditions that do not
determine whether the consolidated entity receives the services that entitle the employees to receive payment. No account
is taken of any other vesting conditions.
The cost of equity-settled transactions is recognised as an expense with a corresponding increase in equity over the vesting
period. The cumulative charge to profit or loss is calculated based on the grant date fair value of the award, the best estimate
of the number of awards that are likely to vest and the expired portion of the vesting period. The amount recognised in profit
or loss for the period is the cumulative amount calculated at each reporting date less amounts already recognised in previous
periods.
If equity-settled awards are modified, as a minimum an expense is recognised as if the modification had not been made. An
additional expense is recognised, over the remaining vesting period, for any modification that increases the total fair value of
the share-based compensation benefit as at the date of modification.
If a non-vesting condition is within the control of the consolidated entity or employee, the failure to satisfy the condition is
treated as a cancellation.
If the condition is not within the control of the consolidated entity or employee and is not satisfied during the vesting period,
any remaining expense for the award is recognised over the remaining vesting period, unless the award is forfeited.
If an equity-settled award is cancelled, it is treated as if it has vested on the date of cancellation and any remaining expense is
recognised immediately. If a new replacement award is substituted for the cancelled award, the cancelled and new award are
treated as if they were a modification.
j)
Issued capital
Ordinary shares are classified as equity.
Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax,
from the proceeds.
k)
Investments and other financial assets
Investments and other financial assets are initially measured at fair value. Transaction costs are included as part of the initial
measurement, except for financial assets at fair value through profit or loss. Such assets are subsequently measured at either
amortised cost or fair value depending on their classification. Classification is determined based on both the business model
within which such assets are held and the contractual cash flow characteristics of the financial asset unless an accounting
mismatch is being avoided.
Financial assets are derecognised when the rights to receive cash flows have expired or have been transferred and the
consolidated entity has transferred substantially all the risks and rewards of ownership. When there is no reasonable
expectation of recovering part or all of a financial asset, it's carrying value is written off.
5 7
ECOGRAF LIMITED ANNUAL REPORT 2022NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFor the Year Ended 30 June 2022 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
i.
Financial assets at fair value through profit or loss
Financial assets at fair value through profit or loss. Typically, such financial assets will be either: (i) held for trading, where they
are acquired for the purpose of selling in the short-term with an intention of making a profit, or a derivative; or (ii) designated
as such upon initial recognition where permitted. Fair value movements are recognised in profit or loss.
ii.
Financial assets at fair value through other comprehensive income
Financial assets at fair value through other comprehensive income include equity investments which the consolidated entity
intends to hold for the foreseeable future and has irrevocably elected to classify them as such upon initial recognition.
iii.
Impairment of financial assets
The consolidated entity recognises a loss allowance for expected credit losses on financial assets which are either measured
at amortised cost or fair value through other comprehensive income. The measurement of the loss allowance depends
upon the consolidated entity's assessment at the end of each reporting period as to whether the financial instrument's credit
risk has increased significantly since initial recognition, based on reasonable and supportable information that is available,
without undue cost or effort to obtain.
Where there has not been a significant increase in exposure to credit risk since initial recognition, a 12-month expected
credit loss allowance is estimated. This represents a portion of the asset's lifetime expected credit losses that is attributable
to a default event that is possible within the next 12 months. Where a financial asset has become credit impaired or where it
is determined that credit risk has increased significantly, the loss allowance is based on the asset's lifetime expected credit
losses. The amount of expected credit loss recognised is measured on the basis of the probability weighted present value of
anticipated cash shortfalls over the life of the instrument discounted at the original effective interest rate.
For financial assets mandatorily measured at fair value through other comprehensive income, the loss allowance is
recognised in other comprehensive income with a corresponding expense through profit or loss. In all other cases, the loss
allowance reduces the asset's carrying value with a corresponding expense through profit or loss.
l) Cash and cash equivalents
Cash and cash equivalents include cash on hand, deposits held at call with banks and other short-term highly liquid
investments with original maturities of 3 months or less.
m) Revenue
Revenue from contracts with customers is recognised when control of the goods or services are transferred to the customer
at an amount that reflects the consideration to which the consolidated entity expects to be entitled in exchange for those
goods or services.
Other revenue is recognised when it is received or when the right to receive payment is established.
All revenue is stated net of the amount of goods and services tax (GST).
n)
Interest income
Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate
applicable, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial
asset to that asset’s net carrying amount.
o) 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 Tax Office (ATO). In these circumstances the GST is recognised as part of the cost of
acquisition of the asset or as part of an item of the expense. Receivables and payables in the statement of financial position
are shown inclusive of GST.
The net amount of GST recoverable from, or payable to, the ATO is included as part of receivables or payables.
Cash flows are presented in the statement of cash flows on a gross basis, except for the GST component of investing and
financing activities, which are disclosed as operating cash flows.
5 8
ECOGRAF LIMITED ANNUAL REPORT 2022 26. Significant Accounting Policies (continued)
p) Earnings per share
Basic earnings per share
Basic earnings per share is calculated by dividing the profit or loss attributable to the owners of EcoGraf Limited, excluding
any costs of servicing equity other than ordinary shares, by the weighted average number of ordinary shares outstanding
during the financial year, adjusted for any bonus elements in ordinary shares issued during the financial year.
Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account
the after tax effect of interest and other financing costs associated with dilutive potential ordinary shares and the weighted
average number of shares assumed to have been issued for no consideration in relation to dilutive potential ordinary shares.
q) Government grants
Government grants are recognised where they can be reliably measured, it is certain that the grant will be received, and all
attached conditions will be satisfied. When the grant relates to an expense item, it is recognised as income on a systematic
basis over the periods that the related costs for which it is intended to compensate, are expensed. When the grant relates to
an asset, it is offset against the capitalised amount and recognised as income in equal amounts over the expected useful life
of the related asset (when the asset is depreciated).
r) Critical accounting estimates and judgements
The directors evaluate estimates and judgements incorporated into the financial report based on historical knowledge and
best available current information. Estimates assume a reasonable expectation of future events and are based on current
trends and economic data, obtained both externally and generated internally by the consolidated entity.
Key estimates — impairment
The consolidated entity assesses impairment at each reporting date by evaluating conditions specific to the entity that may
lead to impairment of assets. Where an impairment trigger exists, the recoverable amount of the asset is determined. Value-
in-use calculations performed in assessing recoverable amounts incorporate a number of key estimates.
Recoverability of exploration and evaluation costs
The consolidated entity assesses the recoverability of the carrying value of capitalised exploration and evaluation costs
at each reporting date (or at closer intervals should the need arise). In completing this assessment, regard is had to the
consolidated entity's intentions with regard to proposed future exploration and development plans for individual exploration
areas, to the success or otherwise of activities undertaken in individual areas in recent times, to the likely success of future
planned exploration activities and to any potential plans for divestment of individual areas. Any required adjustments to the
carrying value of capitalised exploration are completed based on the results of this assessment.
Share-based payment transactions
The consolidated entity measures the cost of shares and performance rights issued to directors, employees and third parties
by reference to the fair value of the equity instruments at the date at which they are granted. The fair value of unlisted
performance rights is determined using either the binomial or Black-Scholes pricing model, taking into account the terms and
conditions upon which the instruments were granted.
s)
Leases policy
The consolidated entity assesses at contract inception whether a contract is, or contains, a lease. That is, if the contract
conveys the right to control the use of an identified asset for a period of time in exchange for consideration.
Consolidated entity as a lessee
The consolidated entity applies a single recognition and measurement approach for all leases, except for short-term leases
and leases of low-value assets. The consolidated entity recognises lease liabilities to make lease payments and right-of-use
assets representing the right to use the underlying assets.
5 9
ECOGRAF LIMITED ANNUAL REPORT 2022NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFor the Year Ended 30 June 2022 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
Right-of-use assets
(i)
The consolidated entity recognises right-of-use assets at the commencement date of the lease (i.e., the date the underlying
asset is available for use). Right-of-use assets are measured at cost, less any accumulated depreciation and impairment
losses, and adjusted for any remeasurement of lease liabilities. The cost of right-of-use assets includes the amount of lease
liabilities recognised, initial direct costs incurred, and lease payments made at or before the commencement date less any
lease incentives received.
Right-of-use assets are depreciated on a straight-line basis over the shorter of the lease term and the estimated useful lives. If
ownership of the leased asset transfers to the consolidated entity at the end of the lease term or the cost reflects the exercise
of a purchase option, depreciation is calculated using the estimated useful life of the asset. The right-of-use assets are also
subject to impairment. Refer to the accounting policies in section (g) Impairment of non-financial assets.
Lease liabilities
ii)
At the commencement date of the lease, the consolidated entity recognises lease liabilities measured at the present value
of lease payments to be made over the lease term. The lease payments include fixed payments (including in substance fixed
payments) less any lease incentives receivable, variable lease payments that depend on an index or a rate, and amounts
expected to be paid under residual value guarantees. The lease payments also include the exercise price of a purchase
option reasonably certain to be exercised by the consolidated entity and payments of penalties for terminating the lease, if
the lease term reflects the consolidated entity exercising the option to terminate. Variable lease payments that do not depend
on an index or a rate are recognised as expenses (unless they are incurred to produce inventories) in the period in which the
event or condition that triggers the payment occurs.
t) Current and non-current classification
Assets and liabilities are presented in the statement of financial position based on current and non-current classification.
An asset is classified as current when: it is either expected to be realised or intended to be sold or consumed in the
consolidated entity's normal operating cycle; it is held primarily for the purpose of trading; it is expected to be realised within
12 months after the reporting period; or the asset is cash or cash equivalent unless restricted from being exchanged or used
to settle a liability for at least 12 months after the reporting period. All other assets are classified as non-current.
A liability is classified as current when: it is either expected to be settled in the consolidated entity's normal operating cycle;
it is held primarily for the purpose of trading; it is due to be settled within 12 months after the reporting period; or there is no
unconditional right to defer the settlement of the liability for at least 12 months after the reporting period. All other liabilities
are classified as non-current.
Deferred tax assets and liabilities are always classified as non-current.
u) Trade and other payables
These amounts represent liabilities for goods and services provided to the consolidated entity prior to the end of the financial
year and which are unpaid. Due to their short-term nature they are measured at amortised cost and are not discounted. The
amounts are unsecured and are usually paid within 30 days of recognition.
v) New accounting standards and interpretations
The consolidated entity has adopted all of the new or amended Accounting Standards and Interpretations issued by the
Australian Accounting Standards Board ('AASB') that are mandatory for the current reporting period.
Any new or amended Accounting Standards or Interpretations that are not yet mandatory have not been early adopted.
27. Standards Issued But Not Yet Effective
Certain new accounting standards and interpretations have been published that are not mandatory for 30 June 2022
reporting periods and have not been early adopted by the consolidated entity. The standards and interpretations that were
issued but not yet effective are set out below. The consolidated entity is in the process of considering the impact of the new
standards. Unless stated otherwise below, the potential effects of the following standards and interpretations have not yet
been fully determined.
6 0
ECOGRAF LIMITED ANNUAL REPORT 2022 27. Standards Issued But Not Yet Effective (continued)
The list below is considered those relevant to the consolidated entity.
Standard or
Pronouncement
AASB 2020-1
Amendments to
Australian Accounting
Standards –
Classifications of
Liabilities as Current or
Non-Current
AASB 2020-6
Amendments to
Australian Accounting
Standards –
Classification of
Liabilities as Current or
Non-current – Deferral
of Effective Date
AASB 2020-3
Amendments to
Australian Accounting
Standards – Annual
Improvements 2018-
2020 and Other
Amendments
Who does
it affect?
Effective
date
All entities
Annual
reporting
periods
beginning
on or after
1 January
2023.
Description
This narrow-scope amendment to AASB 101 Presentation of
Financial Statements clarifies that liabilities are classified as either
current or non-current depending on the rights that exist at the
end of the reporting period, and also clarifies the definition of
settlement of a liability.
For example, a liability must be classified as non-current if an
entity has the right at the end of the reporting period to defer
settlement of the liability for at least 12 months after the reporting
period.
AASB 2020-6 defers the mandatory effective date of
amendments that were originally made in AASB 2020-1 so that
the amendments are required to be applied for annual reporting
periods beginning on or after 1 January 2023 instead of 1 January
2022.
Annual
reporting
periods
beginning
on or after
1 January
2022
This amending standard makes narrow scope amendments to a
number of standards:
All entities
- AASB 1: to simplify its application by a subsidiary that
becomes a first-time adopter after its parent in relation to the
measurement of cumulative translation differences;
- AASB 3: updating the reference to the Conceptual Framework
for Financial Reporting without changing the accounting
requirements for business combinations;
- AASB 9: clarifying which fees an entity includes when assessing
whether the terms of a new or modified financial liability are
substantially different from the terms of the original financial
liability;
- AASB 116: requiring an entity to recognise the sales proceeds
from selling items produced while preparing property, plant and
equipment for its intended use, and the related cost, in profit or
loss, instead of deducting the amounts received from the cost
of the asset;
- AASB 137: specifying the costs that an entity includes when
assessing whether a contract will be loss-making, and
- AASB 141: removing the requirement to exclude cash flows
from taxation when measuring fair value, thereby aligning the
fair value measurement requirements in AASB 141 with those in
other Australian Accounting Standards.
6 1
ECOGRAF LIMITED ANNUAL REPORT 2022NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFor the Year Ended 30 June 2022 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
Description
Who does
it affect?
Effective
date
This amending Standard impacts a number of standards:
All entities
- AASB 7: clarifying that information about measurement bases
for financial instruments is expected to be material to an entity’s
financial statements;
- AASB 101: requiring entities to disclose their material
accounting policy information rather than their significant
accounting policies;
- AASB 108: clarifying how entities should distinguish changes in
accounting policies and changes in accounting estimates.
- AASB 134: identifying material accounting policy information as
a component of a complete set of financial statements, and
- AASB Practice Statement 2, providing guidance on how
to apply the concept of materiality to accounting policy
disclosures.
Standard or
Pronouncement
AASB 2021-2
Amendments to
Australian Accounting
Standards – Disclosure
of Accounting Policies
and Definition of
Accounting Estimates
AASB 2021-6
Amendments to
Australian Accounting
Standards – Disclosure
of Accounting Policies:
Tier 2 and Other
Australian Accounting
Standards
Consistent with the amendments made by AASB 2021-2, this
standard amends:
All entities
- AASB 1049, to require entities to disclosure their material
accounting policy information rather than their significant
accounting policies;
- AASB 1054, to reflect the updated terminology used in AASB
101, and
AASB 1060, to require entities to disclose their material
accounting policy information rather than their significant
accounting policies and to clarify that information about
measurement bases for financial instruments in expected to be
material to an entity’s financial statements.
Annual
reporting
periods
beginning
on or after
1 January
2023
Annual
reporting
periods
beginning
on or after
1 January
2023
6 2
ECOGRAF LIMITED ANNUAL REPORT 2022 DIRECTORS’
DECLARATION
In the directors’ opinion:
1.
The financial statements, comprising the consolidated statement of profit or loss and other comprehensive income,
consolidated statement of financial position, consolidated statement of cash flows, consolidated statement of changes
in equity and accompanying notes, are in accordance with the Corporations Act 2001 and:
a)
b)
Comply with accounting standards and the Corporations Regulations 2001, and
Give a true and fair view of the financial position at 30 June 2022 and of the performance for the year ended on
that date.
2.
3.
4.
The Company has included in the notes to the financial statements an explicit and unreserved statement of compliance
with International Financial Reporting Standards.
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.
The directors have been given the declarations by the chief executive officer and chief financial officer required by
section 295A of the Corporations Act 2001.
This declaration is made in accordance with a resolution of the directors.
Andrew Spinks
Managing Director
Perth, 29 September 2022
6 3
ECOGRAF LIMITED ANNUAL REPORT 2022
6 4
ECOGRAF LIMITED ANNUAL REPORT 2022 AUDITOR’S
REPORT
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF
ECOGRAF LIMITED
Opinion
We have audited the financial report of EcoGraf Limited (the Company) and its subsidiary (the Group), which
comprises the consolidated statement of financial position as at 30 June 2022, 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 the directors' declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act 2001,
including:
(i)
giving a true and fair view of the Group's financial position as at 30 June 2022 and of its financial
performance for the year then ended; and
(ii)
complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those
standards are further described in the Auditor's Responsibilities for the Audit of the Financial Report section of
our report. We are independent of the Group in accordance with the auditor independence requirements of the
Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board's
APES 110 Code of Ethics for Professional Accountants (the Code) that are relevant to our audit of the financial
report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has been given to
the directors of the Company, would be in the same terms if given to the directors as at the time of this auditor's
report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
6 5
ECOGRAF LIMITED ANNUAL REPORT 2022
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.
Key Audit Matter
How our audit addressed this matter
Exploration and Evaluation Assets
Refer to Note 8 in the financial statements
The Group has capitalised exploration and
evaluation expenditure with a carrying value of
$18,403,000 as at 30 June 2022.
In accordance with AASB 6 Exploration for and
Evaluation of Mineral Resource, the Group is
required to assess at each reporting date if there
are any triggers for impairment which may suggest
the carrying value is in excess of the recoverable
value.
We considered this to be a key audit matter due to
the significant management judgments involved in
assessing the carrying value of the asset including:
the basis on which
• Determination of whether the expenditure can
be associated with finding specific mineral
resources, and
that
expenditure is allocated to an area of interest;
• Determination of whether exploration activities
have progressed to the stage at which the
existence of an economically recoverable
mineral reserve may be assessed; and
• Assessing whether
of
impairment are present, and if so, judgments
applied
to determine and quantify any
impairment loss.
indicators
any
Our audit procedures included:
• Assessing
the Group’s accounting policy
for
compliance with accounting standards;
• Obtaining management’s reconciliation of capitalised
exploration and evaluation expenditure by area of
interest and agreeing it to the general ledger;
• Assessing whether the Group’s right to tenure of each
area of interest is current;
• Agreeing a sample of additions
to supporting
documentation and testing that the amounts are
capital in nature and relate to the area of interest;
• Assessing
and
management’s
assessment of whether indicators of impairment
existed as at 30 June 2022;
evaluating
• Enquiring with management and reviewing budgets
and other supporting documentation as evidence that
active and significant operations in, or relation to, the
area of interest will be continued in the future;
determination
• Assessing management’s
that
exploration and evaluation activities have not yet
reached a stage where the existence or otherwise of
economically
be
recoverable
reasonably determined; and
reserves may
• Assessing the disclosures in the financial statements.
Other Information
The directors are responsible for the other information. The other information comprises the information included
in the Group's annual report for the year ended 30 June 2022 but does not include the financial report and the
auditor's report thereon.
Our opinion on the financial report does not cover the other information and 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.
AUDITOR'S REPORT
6 6
ECOGRAF LIMITED ANNUAL REPORT 2022
AUDITOR’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 Corporation 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 have no realistic
alternative but to do so.
Auditor's Responsibilities for the Audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from
material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance
with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements
can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably
be expected to influence the economic decisions of users taken on the basis of this financial report.
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/ar2.pdf. This
description forms part of our auditor's report.
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in the directors' report for the year ended 30 June 2022.
In our opinion, the Remuneration Report of EcoGraf Limited, for the year ended 30 June 2022, 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.
RSM AUSTRALIA PARTNERS
Perth, WA
Dated: 29 September 2022
TUTU PHONG
Partner
6 7
ECOGRAF LIMITED ANNUAL REPORT 2022NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFor the Year Ended 30 June 2022
6 8
ECOGRAF LIMITED ANNUAL REPORT 2022 SHAREHOLDER
INFORMATION
Details of securities as at 27 September 2022
Capital structure
Securities
Fully paid ordinary shares
Performance rights subject to vesting conditions and expiry
Top 20 holders of ordinary shares
The 20 largest registered holders of fully paid ordinary shares were:
Number
450,333,459
9,091,650
Rank Name
Number of Ordinary
Shares held
% of
issued capital
BNP PARIBAS NOMINEES PTY LTD ACF CLEARSTREAM
107,995,952
23.98
1
2
3
4
5
CITICORP NOMINEES PTY LIMITED
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
DR PETER DENNETT MEIER & MRS LYNETTE SUZANNE MEIER
BNP PARIBAS NOMS PTY LTD
42,010,263
12,745,121
10,533,340
7,127,151
6,640,088
5,217,565
3,825,823
3,257,692
3,233,904
3,179,615
3,039,318
3,000,000
2,750,000
2,575,000
2,500,000
2,480,000
2,429,434
2,401,417
2,400,000
9.33
2.83
2.34
1.58
1.47
1.16
0.86
0.72
0.72
0.71
0.67
0.67
0.61
0.57
0.56
0.55
0.54
0.53
0.53
Total
229,341,683
50.93
6 MR ANDREW PETER SPINKS
7
8
9
NATIONAL NOMINEES LIMITED
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
REINDEER INVESTMENTS PTY LIMITED
10 MR KOSTA TRAJKOVSKI & MRS SUSANNE TRAJKOVSKI
11
12
13
CORNWALL HOLDINGS PTY LTD
LAX CONSULTING PTE LTD
BCV NOMINEES PTY LTD
14 MR YINGJIE CHEN
15
16
ANDREW SPINKS
GUNPIN PTY LTD
17 MRS LORRAINE ATKINSON
18
ANDREW SPINKS
19 MR NICOLA CONIDI & MRS GIANNINA CONIDI
20
PHELPS HILL INVESTMENTS PTY LTD
6 9
ECOGRAF LIMITED ANNUAL REPORT 2022NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFor the Year Ended 30 June 2022 SHAREHOLDER INFORMATION
Distribution of Listed Securities
A distribution schedule of fully paid ordinary shares:
Range
100,001 and Over
10,001 to 100,000
5,001 to 10,000
1,001 to 5,000
1 to 1,000
Total
Holders
Number of Shares
%
372
2,210
1,390
2,848
1,056
7,876
358,201,003
72,615,771
11,003,077
7,771,908
741,700
450,333,459
80
16
2
2
-
100
Unmarketable parcels
Holdings less than a marketable parcel of ordinary shares (being 1,538 shares as at 27 September 2022):
Holders
Number of Shares
1,694
1,593,063
Substantial shareholders
The names of substantial shareholders and the number of shares to which each substantial shareholder and their associates
have a relevant interest, as disclosed in substantial shareholding notices given to the Company, are set out below:
Substantial shareholder
Number of Shares
First Sentier Investor Holdings Pty Ltd and its related bodies corporate
33,781,166
Unquoted securities
Unquoted securities on issue were as follows:
Class
Performance rights
Performance rights
Performance rights
Expiry
Date
Number of
Rights
Number of
Holders
19 January 2026
7 December 2026
7 December 2027
7,950,000
1,000,000
641,650
9,091,650
7
2
2
The Performance rights are subject to performance milestones and were issued under the Incentive Performance Rights Plan.
Voting Rights
The voting rights attaching to ordinary shares are:
On a show of hands every holder of ordinary shares present at a meeting in person or by proxy, is entitled to one vote, and
upon a poll each share is entitled to one vote.
Performance rights do not carry any voting rights.
On-Market Buy Back
There is no current on-market buy-back.
7 0
ECOGRAF LIMITED ANNUAL REPORT 2022 SUMMARY OF
TENEMENTS
Mineral tenements
Consolidated entity’s 100% interest:
Licence
ML 548/2015
PL 7907/20121
PL 17824/2021
PL 9331/2013
PL 10092/2014
PL 10388/2014
PL 10390/2014
PL 10872/2016
PL 17823/2021
PL 11081/2017
PL 11082/2017
PL 11143/2017
PL 11196/2018
PL 11386/2019
PL 11598/2021
PL 11600/2021
PL 11668/2021
PL 11667/2021
PL 11837/2022
PL 11915/2022
PL 11838/2022
PL 11839/2022
PL 11840/2022
PL 11841/2022
Area (km2)
Location
9.62
26.42
35.31
2.76
23.23
2.57
2.81
2.60
4.50
2.08
20.77
2.62
46.72
6.73
23.45
2.49
229.48
299.90
297.36
299.63
298.40
299.63
288.87
298.26
Mahenge, Tanzania
Merelani-Arusha, Tanzania
Mahenge, Tanzania
Mahenge, Tanzania
Merelani-Arusha, Tanzania
Mahenge, Tanzania
Mahenge, Tanzania
Simanjiro, Tanzania
Mahenge, Tanzania
Simanjiro, Tanzania
Simanjiro, Tanzania
Simanjiro, Tanzania
Simanjiro, Tanzania
Simanjiro, Tanzania
Mahenge, Tanzania
Mahenge, Tanzania
Kagera-Negara, Tanzania
Kagera-Biharamu, Tanzania
Kagera, Tanzania
Kagera, Tanzania
Ulanga, Tanzania
Ulanga, Tanzania
Ulanga, Tanzania
Ulanga, Tanzania
1 Tenement conversion in progress
Mineral Resource Statement
Epanko Graphite Project Mineral Resource Estimate
30 June 2022
30 June 2021
Classification
Tonnage
(Mt)
Grade
(%TGC)
Measured
Indicated
Inferred
Total
7.5
12.8
10.4
30.7
9.8
10.0
9.9
9.9
Contained
Graphite
(Kt)
738.9
1,280.0
1,030.6
3,049.5
Tonnage
(Mt)
Grade
(%TGC)
7.5
12.8
10.4
30.7
9.8
10.0
9.9
9.9
Contained
Graphite
(Kt)
738.9
1,280.0
1,030.6
3,049.5
Notes
• The Epanko and Merelani-Arusha Graphite Projects are located in Tanzania.
• Totals may not sum due to rounding.
• Mt = 1,000,000 tonnes.
• Tonnage figures have been rounded to the nearest 1,000 and % TGC grades have been rounded to 1 decimal place.
• Mineral Resources are quoted from blocks where the TGC grade is greater than 8%.
7 1
ECOGRAF LIMITED ANNUAL REPORT 2022NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFor the Year Ended 30 June 2022
SUMMARY OF TENEMENTS
Merelani–Arusha Graphite Project Mineral Resource Estimate
30 June 2022
30 June 2021
Classification
Tonnage
(Mt)
Grade
(%TGC)
Measured
Inferred
Total
Notes
7.4
10.3
17.7
6.7
6.3
6.5
Contained
Graphite
(Kt)
500.0
650.0
1,150.0
Tonnage
(Mt)
Grade
(%TGC)
7.4
10.3
17.7
6.7
6.3
6.5
Contained
Graphite
(Kt)
500.0
650.0
1,150.0
• The Epanko and Merelani-Arusha Graphite Projects are located in Tanzania.
• Totals may not sum due to rounding.
• Mt = 1,000,000 tonnes.
• Tonnage figures have been rounded to the nearest 1,000 and % TGC grades have been rounded to 1 decimal place.
• Mineral Resources are quoted from blocks where the TGC grade is greater than 8%.
Competent Persons’ Statement
The information in this report that relates to Exploration Results is based on information compiled by Mr. Andrew Spinks, a
Competent Person, who is a Member of The Australasian Institute of Mining and Metallurgy and is employed by EcoGraf
Limited. Mr. Spinks has sufficient experience which is relevant to the style of mineralisation and type of deposit under
consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of
the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Mr. Spinks consents to the
inclusion in the report of the matters based on his information in the form and context in which it appears.
The information in this report that relates to Mineral Resources is based on information compiled by Mr. David Williams,
a Competent Person, who is a Member of The Australasian Institute of Mining and Metallurgy and is employed by CSA
Global Pty Ltd, an independent consulting company. Mr. Williams has sufficient experience which is relevant to the style of
mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent
Person as defined in the 2012 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and
Ore Reserves”. Mr. Williams consents to the inclusion in the report of the matters based on his information in the form and
context in which it appears.
The information in this report that relates to Ore Reserves has been compiled by Mr. Steve O’Grady who is a Member of The
Australasian Institute of Mining and Metallurgy. Mr. O’Grady is employed by Intermine Engineering and produced the Ore
Reserve estimate based on data and geological information supplied by Mr. Williams. Mr. O’Grady has sufficient experience
that is relevant to the estimation, assessment, evaluation, and economic extraction of the Ore Reserve that he is undertaking
to qualify as a Competent Person as defined in the 2012 edition of the “Australasian Code for Reporting of Exploration
Results, Mineral Resources and Ore Reserves”. Mr. O’Grady consents to the inclusion in the report of the matters based on his
information in the form and context in which it appears.
Mineral Resource Estimation - Governance Statement
EcoGraf Limited ensures that all Mineral Resource Estimates are subject to appropriate levels of governance and internal
controls. Estimation procedures are well established and are subject to systematic internal peer review and external technical
review undertaken by competent and qualified professionals. These reviews have not identified any material issues. EcoGraf
Limited also periodically reviews this governance framework to ensure it remains appropriate for the requirements of its
business activities.
Mineral Resource Estimates are reported on an annual basis in accordance with the 2012 Edition of the “Australasian Code
for Reporting of Exploration Results, Mineral Resources and Ore Reserves” (‘JORC Code’). Mineral Resource Estimates
are quoted inclusive of Ore Reserves. Competent Persons named are Members or Fellows of The Australasian Institute of
Mining and Metallurgy and/or The Australian Institute of Geoscientists and qualify as Competent Persons as defined under
the JORC Code.
7 2
ECOGRAF LIMITED ANNUAL REPORT 2022 7 3
ECOGRAF LIMITED ANNUAL REPORT 2022NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFor the Year Ended 30 June 2022 CORPORATE
DIRECTORY
Directors
Robert Pett
Andrew Spinks Managing Director
John Conidi
Non-Executive Director
Non-Executive Chairman
Company Secretary
Howard Rae
Registered and Principal Office
18 Richardson Street
West Perth WA 6005
Telephone: +61 8 6424 9000
Internet:
Email:
www.ecograf.com.au
info@ecograf.com.au
Share Registry
Link Market Services
Level 12, QV1 Building
250 St Georges Terrace
Perth WA 6000
Telephone: 1300 554 474 (toll free within Australia)
Email:
registrars@linkmarketservices.com.au
Solicitors
Steinepreis Paganin
Level 4, The Read Buildings
16 Milligan Street
Perth WA 6000
Telephone: +61 8 9321 4000
Facsimile:
+61 8 9321 4333
King & Wood Mallesons
Level 30, QV1 Building
250 St Georges Terrace
Perth WA 6000
Telephone: +61 8 9269 7000
+61 8 9269 7999
Facsimile:
Auditor
RSM Australia Partners
Level 32, Exchange Tower
2 The Esplanade
Perth WA 6000
Telephone: +61 8 9261 9100
Facsimile:
+61 8 9261 9111
Bankers
Westpac Banking Corporation
Level 3, Tower 2
123 St Georges Terrace
Perth WA 6000
Stock Exchange Listings
Australian Securities Exchange
ASX Code: EGR
Frankfurt Stock Exchange (Börse Frankfurt)
FSE Code: FMK
OTCQX Stock Exchange
OTCQX Code: ECGFF
Fully paid ordinary shares
7 4
ECOGRAF LIMITED ANNUAL REPORT 2022 ECOGRAF LIMITED ABN 15 117 330 757
A B N 1 5 1 1 7 3 3 0 7 5 7
P + 61 8 6424 9000 / E info@ecograf.com.au
ASX: EGR FSE: FMK OTCQX: ECGFF
www.ecograf.com.au
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