21 October 2016
The Manager Companies
ASX Limited
20 Bridge Street
SYDNEY NSW 2000
Dear Madam
(65 pages by email)
ANNUAL REPORT AND NOTICE OF AGM
In accordance with Listing Rule 4.7 and 3.17, I attach the Company’s Annual Report for the year ended
30 June 2016 and the Company’s Notice of Annual General Meeting to be held at 11.00 am on 22
November 2016.
Yours sincerely
Marcelo Mora
Company Secretary
pjn8649
Equus Mining Limited ABN 44 065 212 679
Level 2, 66 Hunter Street
Sydney NSW 2000
Australia
T +61 2 9300 3366
F +61 2 9221 6333
E info@equusmining.com
W www.equusmining.com
2016 Annual Report
Contents
Corporate Directory
Chairman’s Letter
Review of Operations
Corporate Governance Statement
Directors’ Report
Lead Auditor’s Independence Declaration
Consolidated Statement of Profit or Loss and Other Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Notes to the Financial Statements
Directors’ Declaration
Independent Auditor’s Report
Additional Stock Exchange Information
1
2
3
6
7
15
16
17
18
19
20
46
47
49
EQUUS MINING LIMITED
Corporate Directory
Directors
Mark Lochtenberg
Edward Leschke
Juerg Walker
Robert Yeates
Non-Executive Chairman
Managing Director
Non-Executive Director
Non-Executive Director
Company Secretary
Marcelo Mora
Principal Place of Business and
Registered Office
Level 2
66 Hunter Street
Sydney NSW 2000
Australia
Telephone:
Facsimile:
Email address:
Web site:
(61 2) 9300 3366
(61 2) 9221 6333
info@equusmining.com
www.equusmining.com
Share Registry
Advanced Share Registry Limited
150 Stirling Highway
Nedlands, Western Australia 6009
Telephone:
Facsimile:
(61 8) 9389 8033
(61 8) 9389 7871
Auditors
KPMG
Level 16, Riparian Plaza
71 Eagle Street
Brisbane QLD 4000
Stock Exchange Listings
Australian Securities Exchange
(Code – EQE)
Berlin and Frankfurt Securities Exchanges
(Third Market Segment)
1
2016 Annual Report
Chairman’s Letter
Dear Fellow Shareholders,
Equus Mining’s main priority during the year was to commence initial drilling at its Mina
Rica thermal coal project located in the Magallanes basin, Chile’s largest coal occurrence,
whilst continuing to maintain a strategy of dominating prospective coal acreage and
infrastructure positioning in the region. This has been achieved at minimal cost which is
quite fortunate given the deep cyclical low experienced in thermal coal markets, and a
result, the limited availability of funding during this period.
Dominant land positions are considered a strategic
advantage in the coal industry mainly because coal
seams tend to be laterally extensive and a large land
holding maximises resource potential whilst at the
same time excludes potential competitors. Proximity
to transport is also a strategic consideration. A number
of deep-water sounds transect the Magallanes basin
providing access for bulk-shipping vessels. This deep
water access is a distinct advantage when compared to
other developing coal basins.
Chile’s strong growth in thermal coal consumption has
been driven by relatively high economic growth but
the country remains severely deficient in domestically
occurring energy. This energy shortage has been
exacerbated by the loss of Argentinean supplied gas
and the fervent opposition to hydro generated power.
Alternative imported fuel sources such as LNG and
diesel for power generation remain significantly more
expensive than thermal coal.
Chile has amongst the higher power costs in South
America. This means the growth trajectory in thermal
coal demand is expected to continue. Despite this
demand outlook, Chile’s coal industry is small by world
standards with just one significant producer. Clearly,
there is ample room for a new cost competitive large
local supplier of thermal coal.
Equity markets for the junior resources sector
remained subdued throughout the 2016 fiscal year.
Unlike Australia, Chile’s secured licencing system with
no minimum exploration expenditure requirements
means there isn’t the same time pressure to spend large
amounts of capital at a time when raising capital is
tough. Nevertheless, Equus Mining is not standing still
with a focus on low cost exploration and continuously
assessing new resource projects with the main
criteria being resource quality potential. Several value
creating projects have been short listed and are under
negotiations.
Mark H. Lochtenberg
Chairman
2
EQUUS MINING LIMITED MANAGING DIRECTOR’S REVIEW OF
OPERATIONS
Equus Mining’s (ASX: EQE) (‘Equus’ or ‘the Company’)
Mina Rica thermal coal project is located on the north
side of the Brunswick Peninsula in Chile’s XII Region and
is considered highly strategic given its close proximity
to key idle infrastructure and the potential for rapid
development in order to supply into Chile’s shortage
of domestically produced thermal coal (see Map 1 &
2). Currently Chile consumes approximately 15mpta of
mostly imported thermal coal.
Mina Rica is situated adjacent to the third party owned
Pecket Mine and port/coal loading facility which
has a capacity in excess of 10mtpa. Unwashed coal
product was historically loaded onto bulk carriers and
transported to domestic coastal based thermal power
stations however this operation is currently on care and
maintenance following a high wall failure in the Pecket
Mine’s main pit. There are 13 recognised coal seams at
the Pecket mine of which predominantly Seams 5 & 6
were previously mined commercially.
Initial drilling by Equus was carried out during the
second half of 2015, with the focus on defining the
strike extension of the Pecket Mine coal sequence
to within the eastern area of Mina Rica. The eastern
tenements were acquired by Equus in July 2015 and are
located immediately adjacent to the Company’s original
Mina Rica exploration tenements.
Three of the four holes drilled, namely holes MRE-02,
MRE-03 and MRE-04, intercepted coal bearing sequences
with intercepted cumulative total coal seam thicknesses
of 4.68m, 3.54m and 7.73m respectively (see section
A-B and ASX release dated 27 October 2015(i)). The
intercepted coal bearing stratigraphy is interpreted to
represent the strike extension of the Pecket Mine coal
sequence into the Company’s tenements (See Map 1).
Initial drilling also indicated that the Pecket Mine
sequence extends further along strike to the southeast
than previously interpreted. Based on this new
interpretation and combined with the knowledge that
an adjacent tenement area to the southeast were to
become available, Equus further expanded its Mina Rica
thermal coal project area through the submission of 8
Exploration Licence applications totalling 2,100 hectares
in late 2015. Further Exploration Licence applications
may be made depending on ground availability.
Review of Operations
Field mapping throughout the Mina Rica southeast
extension area commenced in mid-December 2015 and
is ongoing. Whilst this work is still in progress and
detail is confidential for strategic reasons, some key
observations have been made which include:
• Outcropping coal seams have been recorded in
several locations (See Map 1 and Photos 3 and 4)
and are interpreted to be hosted within a closely
analogous stratigraphic setting to that of the
Pecket Mine sequence. These observations support
the interpretation that the Pecket Mine coal seam
sequence extends from the area to the northwest
(as described above), where Equus conducted its
initial drilling, to approximately 7.5km to the south
where multiple outcropping coal seams with an
approximate cumulative thickness greater than
15m have been previously mapped.
The observed outcropping coal seams are partially
exposed where bedrock is incised by creeks
and hence drill testing is required to define the
complete seam thickness potential.
The observed outcropping coal seams are
potentially stratigraphically higher in the gently
easterly dipping Pecket Mine coal bearing sequence
and hence have expanded the target zone to the
east.
The top of most of the mapped outcropping coal
seams have been eroded meaning that seam
thicknesses remain undefined.
Coal float has been observed throughout a large
portion of neighbouring areas of the Mina Rica
southeast extension area.
Throughout the Mina Rica southeast extension
area, unconsolidated fluvio-glacial cover is
relatively thin which means minimal pre-strip and
ground water flow rates.
•
•
•
•
•
Equus has maintained a strategy of acquiring new
adjacent areas with high exploration potential at Mina
Rica as they have become available. The expanded
area now under control in combination with extensive
geological information obtained to date has resulted in
an interpreted Exploration Target(ii) of 50 to 90 million
tonnes of coal. The interpretation is based on the
extension of known coal seams from immediately to the
northwest, as defined by recent drilling, and mapped
coal seams to the south of the Mina Rica project area.
3
2016 Annual Report Review of Operations
This Exploration Target is conceptual in nature and
should not be construed as a JORC compliant resource.
The Exploration Target is based on projections of
established coal seams over appropriate widths and
strike lengths having regard for geological considerations
including seam orientations, specific gravity and
expected seam continuity as determined by a qualified
geological assessment. The Exploration Target assumes
a potential coal seam strike length of 8km, 1km width,
a cumulative thickness of 4.5m to 8.0m and a specific
gravity of 1.4. There is insufficient information to
establish whether further exploration will result in the
determination of a JORC compliant Resource.
A drilling programme of approximately 15 to 20 holes
on a 1km x 1km spaced grid is planned upon funds
becoming available, and the drill program is likely to
take 4 to 5 months to complete depending on operating
conditions. A preliminary plan of the drill holes is shown
in Map 1 however exact positioning will be determined
during field planning.
Map 1. Mina Rica Thermal Coal Project
Targeting 50 million to 90 million tonnes. The Exploration
Target described in this map is conceptual in nature
and should not be construed as a JORC compliant
resource. The Exploration Target is based on projections
of established coal seams over appropriate widths and
strike lengths having regard for geological considerations
including seam orientations, specific gravity and
expected seam continuity as determined by a qualified
geological assessment. The Exploration Target assumes
a potential coal seam strike length of 8km, 1km width,
a cumulative thickness of 4.5m to 8.0m and a specific
gravity of 1.4. There is insufficient information to
establish whether further exploration will result in the
determination of a JORC compliant Resource.
4
EQUUS MINING LIMITED Review of Operations
Map 2. Equus’ Thermal Coal Projects in the Magallanes Basin - Chile’s Largest Known Coal Occurrence
5
2016 Annual Report Review of Operations
Compliance statement
No Material Changes
The information in this report that relates to Exploration
Results and Exploration Target is based on information
compiled by Damien Koerber and the information in
relation to historical and foreign estimates is an accurate
representation of the available data and studies of the
mining project which is endorsed by Mr Koerber.
Mr Koerber is a geological consultant to the Company.
Mr Koerber is a Member of the Australian Institute
of Geoscientists and has sufficient experience which
is relevant to the style of mineralisation and type of
deposits under consideration and to the activities 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 Koerber consents to the inclusion in this
report of the matters based on his information in the form
and context in which it appears.
Equus Mining Limited confirms that it is not aware of
any new information or data that materially affects the
information included in this Annual Report and that all
information continues to apply.
(i) All the material assumptions underpinning the
exploration results information in the initial public
report (see ASX release dated 27 October 2015) continue
to apply and have not materially changed. No new
exploration results are reported for Mina Rica.
(ii) The Exploration Target described in this presentation
is conceptual in nature and should not be construed
as a JORC compliant Resource. The Exploration Target
is based on projections of established coal seams over
appropriate widths and strike lengths having regard for
geological considerations including seam orientations,
specific gravity and expected seam continuity as
determined by qualified geological assessment. The
Exploration Target assumes coal seam strike length of
8km, 1km width, 4.5m to 8m cumulative thickness and
specific gravity of 1.4. There is insufficient information
to establish whether further exploration will result in
the determination of a JORC compliant Resource.
Yours sincerely
Ted Leschke
Managing Director
Dated this 15th day of September 2016
CORPORATE GOVERNANCE STATEMENT
The Board is committed to maintaining the highest standards of Corporate Governance. Corporate Governance is
about having a set of core values and behaviours that underpin the Company’s activities and ensure transparency, fair
dealing and protection of the interests of stakeholders. The Company has reviewed its corporate governance practices
against the Corporate Governance Principles and Recommendations (3rd edition) published by the ASX Corporate
Governance Council.
The 2016 corporate governance statement is dated 26 August 2016 and reflects the corporate governance practices
throughout the 2016 financial year. The board approved the 2016 corporate governance on 2 September 2016.
A description of the Company’s current corporate governance practices is set out in the Company’s corporate
governance statement, which can be viewed at http://www.equusmining.com/corporate-governance/
6
EQUUS MINING LIMITED Directors’ Report
The Directors present their report, together with the consolidated financial statements of the
Group, comprising of Equus Mining Limited (‘Equus’ or ‘the Company’) and its controlled entities
for the financial year ended 30 June 2016 and the auditor’s report thereon.
DIRECTORS
The names and details of the Directors in office during
or since the end of the previous financial year are as
follows. Directors were in office for the entire year
unless otherwise stated.
Mark Hamish Lochtenberg, Non-Executive Chairman
Director since 10 October 2014.
Mr Lochtenberg graduated with a Bachelor of Law (Hons)
degree from Liverpool University, U.K. and has been actively
involved in the coal industry for more than 25 years.
Mark Lochtenberg is the former Executive Chairman
and founding Managing Director of ASX-listed Cockatoo
Coal Limited. He was a principal architect of Cockatoo’s
inception and growth from an early-stage grassroots
explorer through to an emerging mainstream coal
producer. He was also formerly the co-head of Glencore
International AG’s worldwide coal division, where he
spent 13 years overseeing a range of trading activities
including the identification, due diligence, negotiation,
acquisition and aggregation of the coal project portfolio
that would become Xstrata Coal.
Prior to this Mark established a coal “swaps” market for
Bain Refco, (Deutsche bank) after having served as a
senior coal trader for Hansen Neuerburg AG and as coal
marketing manager for Peko Wallsend Limited.
Mr Lochtenberg has previously been a Director of
ASX-listed Cumnock Coal Limited and of privately held
United Collieries Pty Limited and is currently a Director
of Australian Transport and Energy Corridor Pty Limited,
(ATEC).
Mark has served as director of listed Company Cockatoo
Coal Limited in the last three years.
Edward Jan Leschke, Managing Director
Director since 5 September 2012
Mr. Leschke graduated with a Bachelor of Applied
Science – Applied Geology degree from the Queensland
University of Technology. During a 22 year professional
career Mr Leschke initially worked as a mine geologist
at the Elura zinc-lead-silver mine in central New South
Wales as well as holding geological positions in a
number of locations such as the Central Queensland
coal fields, South Australia and Papua New Guinea.
Mr Leschke made the transition to the financial
sector specialising in mining investment, analysis
and corporate finance and has worked for a number
of financial institutions including BZW Stockbroking,
Aberdeen Asset Management and Shaw Stockbroking.
Mr Leschke has been responsible for the inception
of Equus Resources Ltd and the two wholly owned
subsidiaries in the Republic of Chile.
He has not served as a director of any other listed
company during the past three years.
Juerg Marcel Walker, Non-Executive Director
Director appointed 20 May 2002
Juerg Walker is a European portfolio manager and
investor. He has over 30 years’ experience in the
Swiss banking industry, operating his own portfolio
management company after leaving his position as
senior vice president of a private bank in Zurich.
He has not served as a director of any other listed
company during the past three years.
7
2016 Annual Report Directors’ Report
Robert Ainslie Yeates, Non-Executive Director
Director appointed 20 July 2015
DIRECTORS’ MEETINGS
Rob Yeates is a graduate of the University of NSW,
completing a Bachelor of Engineering (Honours 1) in
1971 and a PhD in 1977 and then an MBA in 1986 from
Newcastle University. He began his career with Peko
Wallsend working in a variety of roles including mining
engineering, project management, mine management
and marketing.
He became General Manager Marketing for Oakbridge
Pty Limited in 1989 following a merger with the Peko
Wallsend coal businesses and went on to become
Managing Director of Oakbridge, which was the
largest coal mining company in NSW at that time,
operating one open cut and five underground coal
mines.
Dr Yeates also has gained operating, business
development and infrastructure experience as a
director of Port Waratah Coal Services (Newcastle
Port), Port Kembla Coal Terminal, Great Northern
Mining Corporation NL and Cyprus Australia Coal and
for the past 18 years has been principal of his own mine
management consultancy, providing a wide range of
technical, management and strategic planning services
to the mining industry. Until 2014 he was also Project
Director then CEO of Newcastle Coal Infrastructure
Group, which has developed and is operating coal export
facilities in Newcastle.
Dr Yeates was until 2015 and for the prior ten years a
director in Cockatoo Coal Limited.
COMPANY SECRETARY
Marcelo Mora
Company Secretary since 16 October 2012
Marcelo Mora holds a Bachelor of Business degree and
Graduate Diploma of Applied Corporate Governance,
and is a Chartered Secretary (AGIA). Mr Mora has
been an accountant for more than 29 years and has
experience in resources and mining companies both
in Australia and internationally, providing financial
reporting and company secretarial services to a range of
publicly listed companies.
The number of Directors’ meetings and number of
meetings attended by each of the Directors (while they
were a Director) of the Company during the year are:
Director
Mark H. Lochtenberg
Edward J. Leschke
Juerg M. Walker
Robert A. Yeates
Board Meetings
Held
Attended
2
2
2
2
2
2
2
2
DIRECTORS’ INTERESTS
Directors’ beneficial shareholdings at the date of this
report are:
Fully Paid
Ordinary
Shares
22,306,727
34,368,889
8,297,861
1,090,909
Options
over
ordinary
shares
-
-
-
-
Director
Mark H. Lochtenberg
Edward J. Leschke
Juerg M. Walker
Robert A. Yeates
OPTION HOLDINGS
Options granted to directors’ and officers’
The Company did not grant any options over unissued
ordinary shares during or since the end of the financial
year to directors as part of their remuneration. The
Directors do not hold any options over unissued shares
at the date of this report nor did they hold any at the
reporting date.
The Company has not granted any options over
unissued ordinary shares during or since the end of the
financial year to officers as part of their remuneration.
Unissued shares under option
At the date of this report, the Company does not have
options on issue over ordinary shares (2015: 4,000,000
options)
8
EQUUS MINING LIMITED Directors’ Report
CORPORATE INFORMATION
Corporate Structure
Equus Mining Limited is a limited liability company that is incorporated and domiciled in Australia. It has prepared
a consolidated financial report incorporating the entities that it controlled during the financial year. The Group’s
structure at 30 June 2016 is outlined below.
EQUUS MINING LIMITED – GROUP STRUCTURE AT 30 JUNE 2016
100%
Andean Coal
Pty Ltd
Minera
Carbones Del
Sur Limitada
0.1%
The Companies referred above comprise the “Consolidated Entity” for the purposes of the Financial Statements
included in this report. On 31 July 2015, the Group acquired the remaining 49% ownership interest in Andean Coal Pty
Ltd. During the year, the Group also disposed of subsidiary entity JSC Sherik and deregistered Textonic Consulting
Limited.
9
2016 Annual Report Directors’ Report
PRINCIPAL ACTIVITIES
The principal activity of the Group during the course of
the financial year was the mineral exploration in the
Magallanes Basin after acquiring 100% of Andean Coal
Pty Ltd. The Group’s focus is on exploring for coal and
applying for additional coal prospecting tenements in
southern Chile.
FINANCIAL RESULTS
The consolidated loss after income tax attributable to
members of the Company for the year was $3,573,850
(2015: $1,048,648 loss).
REVIEW OF OPERATIONS
A review of the Group’s operations for the year ended 30
June 2016 is set out on pages 3 to 6 of this Annual Report.
DIVIDENDS
The Directors do not recommend the payment of a
dividend in respect of the financial year ended 30 June
2016. No dividends have been paid or declared during
the financial year (2015 - $nil)
• On 17 March 2016, the subsidiary JSC Sherik, a
company incorporated in the Kyrgyz Republic was
disposed of for no consideration following the sale
of the subsidiaries assets.
• On 11 May 2016, Textonic Consulting Limited was
deregistered.
ENVIRONMENTAL REGULATIONS
The Group’s operations are not subject to any
significant environmental regulations under either
Commonwealth or State legislation.
The Group’s exploration activities in Chile are subject to
environmental laws, regulations and permit conditions
as they apply in the country of operation. There have
been no breaches of environmental laws or permit
conditions while conducting operations in Chile during
the year.
The Board believes that the Group has adequate
systems in place for the management of its
environmental requirements and is not aware of any
breach of those environmental requirements as they
apply to the Group.
CHANGES IN STATE OF AFFAIRS
EVENTS SUBSEQUENT TO BALANCE DATE
In the opinion of the Directors, significant changes in
the state of affairs of the Group that occurred during
the year ended 30 June 2016 were as follows:
• On 20 July 2015, the Group appointed Dr Robert
Yeates as Non-executive-Director of Equus Mining
Limited.
• On 31 July 2015, the Group exercised its options to
acquire the remaining 49% interest in Andean Coal
Pty Ltd by issuing 16,000,000 ordinary shares in
the capital of Equus to Sambas Energy Pty Ltd as
consideration.
• On 19 October 2015, the Company issued 36,213,783
new shares under a placement for a total
consideration of $398,352.
• On 11 December 2015, Equus announced the
expansion of its Mina Rica thermal coal project
through the submission of 8 Exploration Licences
with the authorities in Chile.
• On 16 December 2015, the Company issued
3,363,636 new shares under a placement to
Directors of the Company for a total consideration
of $37,000.
No matters or circumstances have arisen in the interval
between the end of the financial year and the date of
this report any item, transaction or event of a material
or unusual nature likely, in the opinion of the Directors
of the Company, to affect significantly the operations of
the Group, the results of those operations, or the state
of affairs of the Group, in future financial years.
LIKELY DEVELOPMENTS
Equus considers growth as a vital strategy for the
Company taking into consideration its existing
operations in the Magellan province in southern Chile,
the addition of new exploration licences in the Magellan
Basin or by the addition of new ventures. Additional
projects, through mergers or acquisitions are also part
of the natural evolution of the business. In this regards,
Equus is constantly evaluating new projects not only
in Chile but also in other parts of the world. The Group
will continue to seek good partners and good projects to
create business synergies for Equus.
10
EQUUS MINING LIMITED Directors’ Report
During the course of 2016/2017 financial year, the
Directors expect to receive results of future exploration
programs in the Magellan province, which they will
make public in accordance with ASX listing rules once
the information is received.
Further information as to likely developments in the
operations of the Group and the expected results of those
operations in subsequent years has not been included in
this report because disclosure of this information would
be likely to result in unreasonable prejudice to the Group.
INDEMNIFICATION AND INSURANCE OF
OFFICERS AND AUDITORS
During or since the end of the financial, the Company
has not indemnified or made a relevant agreement to
indemnify an officer or auditor of the Company against
a liability incurred as such by an officer or auditor.
The Group has not paid or agreed to pay, a premium in
respect of a contract insuring against a liability incurred
by an officer or auditor.
REMUNERATION REPORT - Audited
Principals of compensation - Audited
Key management personnel have authority and responsibility for planning, directing and controlling the activities
of the Group. Key management personnel comprise the directors of the Company. No other employees have been
deemed to be key management personnel.
The remuneration policy of Directors and senior executives is to ensure the remuneration package properly reflects
the persons’ duties and responsibilities, and that remuneration is competitive in attracting, retaining and motivating
people of the highest quality. The Board is responsible for reviewing its own performance. The evaluation process is
designed to assess the Group’s business performance, whether long-term strategic objectives are being achieved, and
the achievement of individual performance objectives.
The Constitution and ASX Listing Rules specify that the aggregate remuneration of Non-Executive Directors shall be
determined from time to time by a general meeting. The latest determination was at a shareholders meeting on 29
November 2005 when the shareholders approved an aggregate remuneration of $200,000 per year.
Remuneration generally comprises of salary and superannuation. Long-term incentives are able to be provided
through the Company’s share option program, which acts, to align the Director’s and senior executive’s actions with
the interests of the shareholders, no options were granted or outstanding to key management personnel for the
year ended 30 June 2016, or in the prior year. The remuneration disclosed below represents the cost to the Group for
services provided under these arrangements.
Edward Leschke and Mark Lochtenberg are paid through the Company’s payroll. All other Directors services are paid by
way of arrangement with related parties.
There were no remuneration consultants used by the Company during the year ended 30 June 2016, or in the prior year.
Consequences of performance on shareholders’ wealth - Audited
In considering the Group’s performance and benefits for shareholders’ wealth, the Board has regard to the following
indices in respect of the current financial year and the previous four financial years.
2016
$
2015
$
2014
$
2013
$
2012
$
Net loss attributable to equity holders of the parent
3,573,850
1,048,648
9,856,444
3,546,382
3,519,829
Dividends paid
Change in share price
-
(0.01)
-
0.01
-
(0.02)
-
0.00
-
(0.06)
The overall level of key management personnel’s compensation has been determined based on market conditions,
advancement of the Group’s projects and the financial performance of the Group.
11
2016 Annual Report Directors’ Report
REMUNERATION REPORT - Audited (Con’t)
Details of the nature and amount of each major element of the remuneration of each Director of the Company and
other key management personnel of the Company and Group are:
Short-term employee
benefits
Post
Employment
Benefits
Share based
payments
Primary
Salary / Fees
Consulting
Fees
Super-
annuation
share options
Total
Year
$
$
$
$
$
Executive Directors
Edward Leschke
Non-Executive Directors
Norman Seckold ^
Robert Yeates **
Juerg Walker
Mark Lochtenberg
Total all directors
2016
2015
2016
2015
2016
2015
2016
2015
2016
2015
2016
2015
150,000
150,000
-
-
8,306
28,370
30,000
30,000
30,000
21,774
238,370
210,080
-
-
-
-
-
-
-
-
-
-
-
-
^
**
Ceased to be Director on 10 October 2014.
Director since 20 July 2015.
Remuneration Structure - Audited
14,250
14,250
-
-
-
-
-
-
2,850
2,069
17,100
16,319
-
-
-
-
-
-
-
-
-
-
-
-
164,250
164,250
-
-
8,306
28,370
30,000
30,000
32,850
23,843
255,470
226,399
In accordance with best practice corporate governance, the structure of Executive Director and Non-Executive Director
remuneration is separate and distinct.
Service contracts - Audited
In accordance with best practice corporate governance the company provided each key management personnel with a
letter detailing the terms of appointment, including their remuneration.
Executive Directors - Audited
During the financial year ended 30 June 2016, only Edward Leschke was considered an Executive Director. His salary
comprised of fixed remuneration plus 9.5% statutory superannuation paid through the Company’s payroll.
Non Executive Directors - Audited
During the financial year ended 30 June 2016, the following Directors were considered Non Executive Directors:
• Mark Lochtenberg;
Juerg Walker;
•
Robert Yeates since 20 July 2015;
•
12
EQUUS MINING LIMITED Directors’ Report
REMUNERATION REPORT - Audited (Con’t)
The salary component of Non-Executive Directors was made up of:
•
•
•
fixed remuneration;
9.5% statutory superannuation for Australian resident directors pay through the Company’s payroll; and
an entitlement to receive options, subject to shareholders’ approval.
The services of non-executive directors who are not paid through the Company’s payroll system are provided by way of
arrangements with related parties.
Options granted as compensation - Audited
There are no options held by Directors over ordinary shares.
Modification of terms of equity-settled share-based payment transactions - Audited
No terms of equity-settled share-based payment transactions (including options granted as compensation to a key
management person) have been altered or modified by the issuing entity during the 2016 and 2015 financial years.
Exercise of options granted as compensation - Audited
There were no shares issued on the exercise of options previously granted as compensation during the 2016 and 2015
financial years.
Options and rights over equity instruments - Audited
Directors or Key management personnel do not hold any options over unissued shares at the date of this report nor
did they hold any at the reporting date.
Loans to key management personal and their related parties - Audited
There were no loans made to key management personnel or their related parties during the 2016 and 2015 financial
years and no amounts were outstanding at 30 June 2016 (2015 - $nil).
Other transactions with key management personnel - Audited
There were no other transactions with key management personnel or their related parties during 2016.
At 30 June 2016 there were salaries, superannuation and directors fees outstanding of $114,862 (2015: $Nil).
During 2015 certain key management persons, or their related parties, held positions in other entities that resulted in
them having control or joint control over the financial or operating policies of those entities.
During the year ended 30 June 2015, Norman A. Seckold had control over an entity, Mining Services Trust, which
provided full administrative services, including rental accommodation, administrative staff, services and supplies to
the Group. Fees paid to Mining Services Trust during the year ended 30 June 2015 amounted to $240,000. There were
no amounts outstanding for the year ended 30 June 2015.
Movements in shares - audited
The movement during the reporting period in the number of ordinary shares in the Company held directly, indirectly or
beneficially by each key management person, including their related parties, is as follows:
13
2016 Annual Report Directors’ Report
REMUNERATION REPORT - Audited (Con’t)
Fully paid ordinary shareholdings and transactions - 2016
Key management personnel
Mark H. Lochtenberg
Edward J. Leschke
Jurg M. Walker
Robert A. Yeates
NON-AUDIT SERVICES
Held at
1 July 2015
20,034,000
34,368,889
8,297,861
Purchases
2,272,727
-
-
-
1,090,909
Sales
-
-
-
-
Held at
30 June 2016
22,306,727
34,368,889
8,297,861
1,090,909
During the year ended 30 June 2016 KPMG, the Group’s auditor, has performed certain other services in addition to the
audit and review of the financial statements.
The board has considered the non-audit services provided during the year by the auditor and is satisfied that
the provision of those non-audit services is compatible with, and did not compromise, the auditor independence
requirements of the Corporations Act 2001.
Details of the amounts paid to the auditor of the Group, KPMG, and its network firms for audit and non-audit services
provided during the year are set out below.
Services other than audit and review of financial statements:
Other services
Taxation advisory services
2016
$
8,500
8,500
2015
$
-
-
Audit and review of financial statements
76,900
86,750
85,400
86,750
AUDITOR’S INDEPENDENCE DECLARATION
The lead auditor’s independence declaration is set out on page 15 and forms part of the Directors’ Report for the
financial year ended 30 June 2016.
Signed at Sydney this 15th day of September 2016
in accordance with a resolution of the Board of Directors:
Mark H. Lochtenberg
Chairman
Edward J. Leschke
Managing Director
14
EQUUS MINING LIMITED Lead Auditor’s Independence Declaration
Lead Auditor’s Independence Declaration
under Section 307C of the Corporations Act 2001 to the Directors of Equus Mining Limited
I declare that, to the best of my knowledge and belief, in relation to the audit for the financial year ended 30 June
2016, there have been:
(i)
no contraventions of the auditor independence requirements as set out in the Corporations Act 2001 in relation to
the audit; and
(ii) no contraventions of any applicable code of professional conduct in relation to the audit.
KPMG
Adam Twemlow
Partner
Brisbane
15 September 2016
KPMG, an Australian partnership and a member firm of the KPMG
network of independent member firms affiliated with KPMG International
Cooperative (“KPMG International”), a Swiss entity.
Liability limited by a scheme approved under
Professional Standards Legislation.
15
2016 Annual Report Consolidated Statement of Profit or
Loss and Other Comprehensive Income
For the Year Ended 30 June 2016
CONTINUING OPERATIONS
Other income
Expenses
Notes
2016
$
2015
$
4
3,517
293,218
Employee, directors and consultants costs
(376,858)
(402,261)
Depreciation expense
Travel expenses
Reversal impairment of property
Gain on disposal of subsidiary
Other expenses
Results from operating activities
Finance income
Finance costs
Net finance income/(expense)
Profit/(loss) before tax
Tax benefit/(expense)
Profit/(loss) from continuing operations
DISCONTINUED OPERATION
Loss from discontinued operation (net of tax)
Loss for the year
Other comprehensive income for the year
Items that may be classified subsequently to profit or loss:
Exchange differences on translation of foreign operations
Net change in fair value of available-for-sale financial assets
Net change in fair value of available-for-sale financial assets
reclassified to profit or loss
Total other comprehensive income/(loss)
Total comprehensive loss for the year
Loss for the year attributable to:
Equity holders of the Company
Non-controlling Interests
Total comprehensive loss attributable to:
Equity holders of the Company
Non-controlling Interests
Earnings per share
Basic and diluted loss per share attributable to ordinary equity
holders (dollars)
Earnings per share - continuing operations
Basic and diluted loss per share attributable to ordinary equity
holders (dollars)
27
4
5
5
6
(937)
(9,290)
70,819
177,917
(862)
(7,546)
-
-
(296,739)
(413,301)
(431,571)
(530,752)
11,558
(174,515)
(162,957)
65,403
(97,251)
(31,848)
(594,528)
(562,600)
-
-
(594,528)
(562,600)
28
(2,977,730)
(479,561)
(3,572,258)
(1,042,161)
15
10
10
16
16
2,798,518
(174,515)
174,515
2,798,518
29,745
(97,251)
97,251
29,745
(773,740)
(1,012,416)
(3,573,850)
(1,048,648)
1,592
6,487
(3,572,258)
(1,042,161)
(776,447)
(1,018,903)
2,707
6,487
(773,740)
(1,012,416)
(0.008)
(0.003)
(0.001)
(0.002)
The above Consolidated Statement of Profit or Loss and Other Comprehensive Income should be read in conjunction
with the accompanying notes.
16
EQUUS MINING LIMITED Consolidated Statement of
Financial Position
As at 30 June 2016
Notes
2016
$
2015
$
7
8
27
9
10
11
12
13
14
15
15
22
119,261
13,378
70,819
2,023
644,765
5,120
-
6,014
205,481
655,899
27,976
1,534,227
-
1,562,203
1,767,684
194,503
1,073,712
937
1,269,152
1,925,051
435,504
435,504
435,504
229,377
229,377
229,377
1,332,180
1,695,674
108,545,219
107,814,973
-
144,000
(465,579)
(3,262,982)
(106,747,460)
(103,205,351)
1,332,180
1,490,640
-
205,034
1,332,180
1,695,674
Current Assets
Cash and cash equivalents
Receivables
Assets held for sale
Other
Total Current Assets
Non-Current Assets
Available-for-sale financial assets
Exploration and evaluation expenditure
Property, plant and equipment
Total Non-Current Assets
Total Assets
Current Liabilities
Payables
Total Current Liabilities
Total Liabilities
Net Assets
Equity
Share capital
Reserves
Foreign currency translation reserve
Accumulated losses
Parent entity interest
Non-controlling interests
Total Equity
The above Consolidated Statement of Financial Position should be read in conjunction with the accompanying notes.
17
2016 Annual Report Consolidated Statement of
Changes in Equity
For the Year Ended 30 June 2016
Share Capital
Accumulated
Losses
Reserves
Total
Non-
controlling
Interest
Total Equity
$
$
$
$
$
$
Balance at 1 July 2014
106,622,162 (102,156,703)
(3,148,727)
1,316,732
-
1,316,732
Profit/(Loss) for the year
Total other comprehensive income
Total comprehensive profit/(loss)
for the year
-
-
-
Transactions with owners recorded
directly in equity
Ordinary shares issued
1,226,340
Transaction costs on issue of
shares
Changes in ownership interest in
subsidiaries
Non-controlling interest on
acquisition of subsidiaries
(33,529)
-
(1,048,648)
-
(1,048,648)
6,487
(1,042,161)
-
29,745
29,745
-
29,745
(1,048,648)
29,745
(1,018,903)
6,487
(1,012,416)
-
-
-
-
-
-
1,226,340
(33,529)
-
-
1,226,340
(33,529)
-
198,547
198,547
Balance at 30 June 2015
107,814,973 (103,205,351)
(3,118,982)
1,490,640
205,034
1,695,674
Balance at 1 July 2015
107,814,973 (103,205,351)
(3,118,982)
1,490,640
205,034
1,695,674
Profit/(Loss) for the year
Total other comprehensive income
Total comprehensive profit/(loss)
for the year
-
-
-
(3,573,850)
-
(3,573,850)
-
2,797,403
2,797,403
1,592
1,115
(3,572,258)
2,798,518
(3,573,850) 2,797,403
(776,447)
2,707
(773,740)
Transactions with owners
recorded directly in equity
Ordinary shares issued
435,352
Transaction costs on issue of
shares
(25,106)
-
-
-
-
Transfer of expired options
-
144,000
(144,000)
435,352
(25,106)
-
-
-
-
Changes in ownership interest in
subsidiaries
Acquisition of non-controlling
interest
320,000
(112,259)
-
207,741
(207,741)
435,352
(25,106)
-
-
Balance at 30 June 2016
108,545,219 (106,747,460)
(465,579)
1,332,180
-
1,332,180
The above Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying notes.
18
EQUUS MINING LIMITED Consolidated Statement of
Cash Flows
For the Year Ended 30 June 2016
Notes
2016
$
2015
$
4,560
16,887
(524,817)
(856,695)
(520,257)
(839,808)
3,570
12,283
Cash flows from operating activities
Cash receipts in the course of operations
Cash payments in the course of operations
Net cash used in operations
Interest received
Net cash used in operating activities
17
(516,687)
(827,525)
Cash flows from investing activities
Payments for exploration and development expenditure
Proceeds from sale of plant and equipment
Proceed from sale of tenement interest
Net cash from/(used in) investing activities
Cash flows from financing activities
Proceeds from share issues
Share issue expenses
Net cash provided by financing activities
Net increase / (decrease) in cash held
Cash and cash equivalents at 1 July
Effects of exchange rate fluctuations on cash held
(419,063)
(823,250)
-
-
(419,063)
893,883
41,249
111,882
435,352
1,226,340
(25,106)
(33,529)
410,246
1,192,811
(525,504)
644,765
-
477,168
167,597
-
Cash and cash equivalents at 30 June
17
119,261
644,765
The above Consolidated Statement of Cash Flows should be read in conjunction with the accompanying notes.
19
2016 Annual Report Notes to the Consolidated
Financial Statements
For the Year Ended 30 June 2016
1. REPORTING ENTITY
Equus Mining Limited (the ‘Company’) is a company domiciled in Australia. The address of the Company’s registered
office is Level 2, 66 Hunter Street, Sydney, NSW, 2000. The consolidated financial statements of the Company as at
and for the year ended 30 June 2016 comprises the Company and its subsidiaries (together referred to as the ‘Group’).
The Group is a for-profit entity and is primarily engaged in identifying and evaluating coal resource opportunities in
southern Chile, South America.
2. BASIS OF PREPARATION
(a) Statement of compliance
The consolidated financial statements are general purpose financial statements which have been prepared in
accordance with Australian Accounting Standards (‘AASBs’) adopted by the Australian Accounting Standards Board
(‘AASB’) and the Corporations Act 2001. The consolidated financial statements comply with International Financial
Reporting Standards (‘IFRSs’) and interpretations adopted by the International Accounting Standards Board (‘IASB’).
The consolidated financial statements were authorised for issue by the Directors on 15 September 2016.
(b) Basis of measurement
The consolidated financial statements have been prepared on the historical cost basis except for available-for-sale
financial assets which are measured at fair value.
(c) Functional and presentation currency
These consolidated financial statements are presented in Australian dollars, which is the Company’s functional currency.
(d) Going concern
The consolidated financial statements have been prepared on a going concern basis, which contemplates the
realisation of assets and settlement of liabilities in the ordinary course of business.
During the year, the Company raised $410,246 (net of associated costs) through several placements.
The Group recorded a loss attributable to equity holders of the Company of $3,573,850 for the year ended 30 June 2016
and has accumulated losses of $106,747,460 as at 30 June 2016. The Group has cash on hand of $119,261 at 30 June 2016
and used $935,750 of cash in operations, including payments for exploration and evaluation, for the year ended 30
June 2016. Additional funding will be required to meet the Group’s projected cash outflows for a period of 12 months
from the date of the directors’ declaration.
These conditions give rise to a material uncertainty that may cast significant doubt upon the Group’s ability to continue
as a going concern. The ongoing operation of the Group is dependent upon the Group raising additional funding from
shareholders or other parties and the Group reducing expenditure in-line with available funding. In addition, related
parties of the Group will be required to continue to defer settlement of liabilities until the Group has sufficient working
capital to repay these amounts without compromising the ability of the Group to continue as a going concern.
The Directors have prepared cash flow projections that support the ability of the Group to continue as a going
concern. These cash flow projections assume the Group obtains sufficient additional funding from shareholders or
other parties. If such funding is not achieved, the Group plans to reduce expenditure to the level of funding available
and continue to defer settlement of liabilities to related parties. The related parties have provided confirmation of
their continued support for the Group and have agreed to these deferred settlement conditions.
In the event that the Group does not obtain additional funding and/or continue to defer settlement of related party
liabilities, it may not be able to continue its operations as a going concern and therefore may not be able to realise its
assets and extinguish its liabilities in the ordinary course of operations and at the amounts stated in the consolidated
financial statements.
20
EQUUS MINING LIMITED Notes to the Consolidated
Financial Statements
For the Year Ended 30 June 2016
2. BASIS OF PREPARATION (Cont.)
(e) Use of estimates and judgements
The preparation of the consolidated financial statements in conformity with IFRS requires management to make
judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts
of assets, liabilities, income and expenses. Actual results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are
recognised in the period in which the estimate is revised and in any future periods affected.
In particular, information about significant areas of estimation uncertainty and critical judgements in applying
accounting policies that have the most significant effect on the amount recognised in the consolidated financial
statements are described in the following notes:
•
•
•
•
Note 2(d) - Going concern;
Note 6 - Income tax expense;
Note 11 - Exploration and evaluation expenditure; and
Note 29 – Acquisition of controlled entities.
3. SIGNIFICANT ACCOUNTING POLICIES
The accounting policies set out below have been applied consistently to all periods presented in these consolidated
financial statements, and have been applied consistently by entities in the Group.
(a) Revenue recognition
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the entities and the
revenue can be reliably measured.
Finance income and finance costs
Finance income comprises interest income on funds invested (including available-for-sale financial assets), dividend
income and gains on the disposal of available-for-sale financial assets. Interest income is recognised as it accrues in
profit or loss, using the effective interest method. Dividend income is recognised in profit or loss on the date that the
Group’s right to receive payment is established, which in the case of quoted securities is the ex-dividend date.
Finance costs comprise interest expense on borrowings, losses on disposal of available-for-sale financial assets and
impairment losses recognised on financial assets. Borrowing costs that are not directly attributable to the acquisition,
construction or production of a qualifying asset are recognised in profit or loss using the effective interest method.
Foreign currency gains and losses are reported on a net basis.
(b) Exploration and evaluation expenditure
Exploration and evaluation expenditure, including the costs of acquiring licences, are capitalised as intangible
exploration and evaluation assets on an area of interest basis, less any impairment losses. Costs incurred before the
Group has obtained the legal rights to explore an area are recognised in profit or loss.
Exploration and evaluation assets are only recognised if the rights of the area of interest are current and either:
•
•
the expenditures are expected to be recouped through successful development and exploitation of the area of
interest; or
activities in the area of interest have not at the reporting date, reached a stage which permits a reasonable
assessment of the existence or otherwise of economically recoverable reserves and active and significant
operations in, or in relation to, the area of interest are continuing.
21
2016 Annual Report Notes to the Consolidated
Financial Statements
For the Year Ended 30 June 2016
3. SIGNIFICANT ACCOUNTING POLICIES (Cont.)
(b) Exploration and evaluation expenditure (Cont.)
Exploration and evaluation assets are assessed for impairment if sufficient data exists to determine technical
feasibility and commercial viability and facts and circumstances suggest that the carrying amount exceeds the
recoverable amount. For the purposes of impairment testing, exploration and evaluation assets are allocated to cash-
generating units to which the exploration activity relates. The cash generating unit shall not be larger than the area of
interest.
Once the technical feasibility and commercial viability of the extraction of mineral resources in an area of interest are
demonstrable, exploration and evaluation assets attributable to that area of interest are first tested for impairment
and then reclassified to developing mine properties.
(c) Property, plant and equipment
Recognition and measurement
Items of property, plant and equipment are measured at cost less accumulated depreciation and accumulated
impairment losses.
Cost includes expenditure that is directly attributable to the acquisition of the asset. The cost of self-constructed
assets includes the cost of materials and direct labour, any other costs directly attributable to bringing the assets to
a working condition for their intended use, the costs of dismantling and removing the items and restoring the site on
which they are located and capitalised borrowing costs. Cost also may include transfers from equity of any gain or loss
on qualifying cash flow hedges of foreign currency purchases of property, plant and equipment. Purchased software
that is integral to the functionality of the related equipment is capitalised as part of that equipment.
When parts of an item of property, plant and equipment have different useful lives, they are accounted for as
separate items (major components) of property, plant and equipment.
The gain or loss on disposal of an item of property, plant and equipment is determined by comparing the proceeds
from disposal with the carrying amount of the property, plant and equipment, and is recognised net within
other income/other expenses in profit or loss. When revalued assets are sold, any related amount included in the
revaluation reserve is transferred to retained earnings.
Depreciation
Items of property, plant and equipment are depreciated from the date that they are installed and ready for use, or in
respect of internally constructed assets, from the date that the asset is completed and ready for use.
Depreciation is calculated to write off the cost of property, plant and equipment less their estimated residual values
using the straight-line basis over their estimated useful lives. Depreciation is generally recognised in profit or loss,
unless the amount is included in the carrying amount of another asset.
Depreciation rates
Class of assets
Computer and Office Equipment
Motor Vehicles
Building improvements
Plant & equipment
Office Fittings
Depreciation basis
Depreciation rate
Straight Line
Straight Line
Straight Line
Straight Line
Straight Line
20% to 50%
10% to 20%
10%
20%
25%
22
EQUUS MINING LIMITED Notes to the Consolidated
Financial Statements
For the Year Ended 30 June 2016
3. SIGNIFICANT ACCOUNTING POLICIES (Cont.)
(d) Financial instruments
Non-derivative financial assets
The Group initially recognises loans and receivables on the date that they are originated. All other financial assets
(including assets designated at fair value through profit or loss) are recognised initially on the trade date at which the
Group becomes a party to the contractual provisions of the instrument.
The Group derecognises a financial asset when the contractual rights to the cash flows from the asset expire, or it
transfers the rights to receive the contractual cash flows on the financial asset in a transaction in which substantially
all the risks and rewards of ownership of the financial asset are transferred. Any interest in such transferred financial
assets that is created or retained by the Group is recognised as a separate asset or liability.
Financial assets and liabilities are offset and the net amount presented in the statement of financial position when,
and only when, the Group has a legal right to offset the amounts and intends either to settle them on a net basis or to
realise the asset and settle the liability simultaneously.
The Group classifies non-derivative financial assets into the following categories:
Financial assets at fair value through profit or loss
Financial assets at fair value through profit or loss are financial assets held for trading. A financial asset is classified
in this category if acquired principally for the purpose of selling in the short term. Derivatives are classified as held
for trading unless they are designated as hedges. Assets in this category are classified as current assets if they are
expected to be settled within 12 months; otherwise they are classified as non-current. Financial assets at fair value
through profit or loss are measured at fair value and changes therein, which take into account any dividend income,
are recognised in profit or loss.
Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in
an active market. Such assets are recognised at fair value plus any directly attributable transaction costs. Subsequent
to initial recognition, loans and receivables are measured at amortised cost using the effective interest method, less
any impairment losses. They are included in current assets, except for those with maturities greater than 12 months
after the reporting period, which are classified as non-current assets. Loans and receivables comprise cash and cash
equivalents and trade and other receivables.
Available-for-sale financial assets
The Group’s investments in equity securities are classified as available-for-sale financial assets. Available-for-sale
financial assets are non-derivative financial assets that are designated as available-for-sale or are not classified in any
of the above categories of financial assets. Available-for-sale financial assets are recognised initially at fair value plus
any directly attributable transaction costs. Subsequent to initial recognition, they are measured at fair value and
changes therein, other than impairment losses, are recognised in other comprehensive income and presented in the fair
value reserve in equity. When an investment is derecognised, the cumulative gain or loss is reclassified to profit or loss.
Non-derivative financial liabilities
The Group initially recognises debt securities issued and subordinated liabilities on the date that they are originated.
All other financial liabilities are recognised initially on the trade date, which is the date that the Group becomes a
party to the contractual provisions of the instrument.
The Group derecognises a financial liability when its contractual obligations are discharged, cancelled or expire.
Other financial liabilities comprise trade and other payables.
23
2016 Annual Report Notes to the Consolidated
Financial Statements
For the Year Ended 30 June 2016
3. SIGNIFICANT ACCOUNTING POLICIES (Cont.)
(d) Financial instruments (Cont.)
Share Capital
Ordinary Shares
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of ordinary shares are
recognised as a deduction from equity, net of any tax effects.
(e) Basis of consolidation
Subsidiaries
Subsidiaries are entities controlled by the Group. The Group controls an entity when it is exposed to, or has rights to,
variable returns from its involvement with the entity and has the ability to affect those returns through its power
over the entity. The financial statements of subsidiaries are included in the consolidated financial statements from
the date that control commences until the date that control ceases.
Loss of control
When the Group loses control over a subsidiary, it derecognises the assets and liabilities of the subsidiary, and any
related NCI and other components of equity. Any resulting gain or loss is recognised in profit or loss. Any interest
retained in the former subsidiary is measured at fair value when control is lost.
Transactions eliminated on consolidation
Intra-group balances and any unrealised gains and losses or income and expenses arising from intragroup
transactions, are eliminated in preparing the consolidated financial statements.
(f) Trade and other receivables and payables
Trade receivables and payables are carried at amortised cost. For receivables and payables with a remaining life of
less than one year, the notional amount is deemed to reflect the fair value. All other receivables and payables are
discounted to determine the fair value.
(g) Impairment
Non-derivative financial assets
A financial asset not classified at fair value through profit or loss is assessed at each reporting date to determine
whether there is any objective evidence that it is impaired. A financial asset is considered to be impaired if objective
evidence indicates that one or more events have had a negative effect on the estimated future cash flows of that asset.
For an investment in an equity security classified as available-for-sale, a significant or prolonged decline in its fair
value below its cost is objective evidence of impairment. The Group consider a decline of 20 per cent to be significant
and a period of 9 months to be prolonged.
Financial assets measured at amortised cost
Individually significant financial assets are tested for impairment on an individual basis. The remaining financial
assets are assessed collectively in groups that share similar credit risk characteristics.
An impairment loss in respect of a financial asset measured at amortised cost is calculated as the difference between
its carrying amount and the present value of the estimated future cash flows discounted at the original effective
interest rate. Losses are recognised within profit or loss. When an event occurring after the impairment was
recognised causes the amount of impairment loss to decrease, the decrease in impairment loss is reversed through
profit or loss.
24
EQUUS MINING LIMITED Notes to the Consolidated
Financial Statements
For the Year Ended 30 June 2016
3. SIGNIFICANT ACCOUNTING POLICIES (Cont.)
(g) Impairment (Cont.)
Available-for-sale financial assets
Impairment losses on available-for-sale financial assets are recognised by reclassifying the losses accumulated in the
fair value reserve in equity to profit or loss. The cumulative loss that is reclassified from equity to profit or loss is the
difference between the acquisition cost and the current fair value, less any impairment loss recognised previously in
profit or loss. Any subsequent recovery in the fair value of an impaired available-for-sale equity security is recognised
in other comprehensive income.
Non-financial assets
An impairment loss is recognised whenever the carrying amount of an asset or its cash-generating unit (CGU) exceeds
its recoverable amount. The recoverable amount of an asset or CGU is the greater of their fair value less costs to sell
and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using
a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific
to the asset or CGU. For impairment testing, assets are grouped together into the smallest group of assets that
generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or CGUs.
Impairment losses are recognised in profit or loss.
Reversals of impairment
An impairment loss in respect of a financial asset carried at amortised cost is reversed if the subsequent increase in
recoverable amount can be related objectively to an event occurring after the impairment loss was recognised.
In respect of non-financial assets, an impairment loss is reversed if there has been a conclusive change in the
estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the
asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation
or amortisation, if no impairment loss had been recognised.
(h) Cash and cash equivalents
Cash and cash equivalents comprise cash balances and call deposits with an original maturity of three months or less.
(i) Income tax
Current tax and deferred tax is recognised in profit or loss except to the extent that it relates to a business
combination or items recognised directly in equity or in other comprehensive income.
Current tax
Current tax is the expected tax payable or receivable on the taxable income or loss for the year, using tax rates enacted
or substantially enacted at the reporting date, and any adjustment to tax payable in respect of previous years.
Deferred tax
Deferred tax is recognised in respect of temporary differences between the carrying amount of assets and liabilities
for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognised for:
•
•
•
temporary differences on the initial recognition of assets or liabilities in a transaction that is not a business
combination and that affects neither accounting nor taxable profit or loss;
temporary differences related to investments in subsidiaries to the extent that the Group is able to control the
timing of the reversal of the temporary differences and it is probable that they will not reverse in the foreseeable
future; or
taxable temporary differences arising on the initial recognition of goodwill.
25
2016 Annual Report Notes to the Consolidated
Financial Statements
For the Year Ended 30 June 2016
3. SIGNIFICANT ACCOUNTING POLICIES (Cont.)
(i) Income tax (Cont.)
The measurement of deferred tax reflects the tax consequences that would follow the manner in which the Group
expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities.
Deferred tax is measured at the tax rates that are expected to be applied to temporary differences when they reverse,
using tax rates enacted or substantively enacted at the reporting date. Deferred tax assets and liabilities are offset
if there is a legally enforceable right to offset current tax liabilities and assets and they relate to taxes levied by the
same tax authority on the same taxable entity, or on different tax entities, but they intend to settle current tax
liabilities and assets on a net basis or their tax assets and liabilities will be realised simultaneously.
A deferred tax asset is recognised for unused tax losses, tax credits and deductible temporary differences to the
extent that it is probable that future taxable profits will be available against which they can be utilised. Deferred tax
assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related
tax benefit will be realised.
(j) Foreign currency transactions
Transactions in foreign currencies are translated at the foreign exchange rate ruling at the date of the transaction.
Monetary assets and liabilities denominated in foreign currencies at the reporting date are retranslated to the
functional currency at the exchange rate at that date. The foreign currency gain or loss on monetary items is the
difference between amortised cost in the functional currency at the beginning of the period, adjusted for effective
interest and payments during the period, and the amortised cost in foreign currency translated at the exchange rate
at the end of the reporting period.
Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair value are retranslated to
the functional currency at the exchange rate at the date that the fair value was determined. Foreign currency differences
arising on retranslation are recognised in profit or loss, except for differences arising on the retranslation of available-
for-sale equity instruments, a financial liability designated as a hedge of the net investment in a foreign operation or
qualifying cash flow hedges, which are recognised in other comprehensive income. Non-monetary items that are measured
in terms of historical cost in a foreign currency are translated using the exchange rate at the date of the transaction.
(k) Foreign operations
The assets and liabilities of foreign operations are translated to Australian dollars at foreign exchange rates ruling
at the reporting date. The income and expenses of foreign operations are translated to Australian dollars at rates
approximating the foreign exchange rates ruling at the dates of the transactions. Foreign exchange differences
arising on retranslation are recognised directly in the foreign currency translation reserve (‘FCTR’), a separate
component of equity.
Foreign exchange gains and losses arising from a monetary item receivable or payable to a foreign operation, the
settlement of which is neither planned nor likely in the foreseeable future, are considered to form part of a net
investment in a foreign operation and are recognised directly in the FCTR.
Any references to functional currency, unless otherwise stated, are to the functional currency of the Company,
Australian dollars.
When a foreign operation is disposed of, in part or in full, the relevant amount in the FCTR is transferred to profit or
loss as part of the profit or loss on disposal.
When the settlement of a monetary item receivable from or payable to a foreign operation is neither planned nor
likely in the foreseeable future, foreign exchange gains and losses arising from such a monetary item are considered
to form part of a net investment in a foreign operation and are recognised in other comprehensive income, and are
presented within equity in the FCTR.
26
EQUUS MINING LIMITED Notes to the Consolidated
Financial Statements
For the Year Ended 30 June 2016
3. SIGNIFICANT ACCOUNTING POLICIES (Cont.)
(l) Segment reporting
Determination and presentation of operating segments
The Group determines and presents operating segments based on the information that is provided internally to the
Managing Director, who is the Group’s chief operating decision maker.
An operating segment is a component of the Group that engages in business activities from which it may earn
revenues and incur expenses, including revenues and expenses that relate to transactions with any of the Group’s
other components. All operating segments’ operating results are regularly reviewed by the Group’s Managing Director
to make decisions about resources to be allocated to the segment and assess its performance, and for which discrete
financial information is available.
Segment results that are reported to the Managing Director include items directly attributable to a segment as well
as those that can be allocated on a reasonable basis. Unallocated items comprise mainly corporate assets (primarily
the Company’s headquarters), head office expenses, and income tax assets and liabilities.
Segment capital expenditure is the total cost incurred during the period to acquire property, plant and equipment,
and intangible assets other than goodwill.
(m) Provisions
A provision is recognised if, as a result of a past event, the Group has a present legal or constructive obligation that
can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the
obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects the
current market assessments of the time value of money and the risks specific to the liability. The unwinding of the
discount is recognised as a finance cost.
(n) Goods and services tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred
is not recoverable from the Australian Taxation Office. 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 balance sheet are
shown inclusive of GST.
Cash flows are presented in the Consolidated 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.
(o) Employee benefits
Short-term employee benefits
Short-term employee benefits are expensed as the related service is provided. A liability is recognised for the amount
expected to be paid if the Group has a present legal or constructive obligation to pay this amount as a result of past
service provided by the employee and the obligation can be estimated reliably.
Share-based payment transactions
The grant-date fair value of share-based payment awards granted to employees is recognised as an employee expense,
with a corresponding increase in equity, over the period that the employees become unconditionally entitled to
the awards. The amount recognised as an expense is adjusted to reflect the number of awards for which the related
service and non-market vesting conditions are expected to be met, such that the amount ultimately recognised as an
expense is based on the number of awards that meet the related service and non-market performance conditions at
the vesting date. For share-based payment awards with non-vesting conditions, the grant date fair value of the share-
based payment is measured to reflect such conditions and there is no true-up for differences between expected and
actual outcomes.
27
2016 Annual Report Notes to the Consolidated
Financial Statements
For the Year Ended 30 June 2016
3. SIGNIFICANT ACCOUNTING POLICIES (Cont.)
(o) Employee benefits (Cont.)
Site restoration
In accordance with the Group’s environmental policy and applicable legal requirements, a provision for site
restoration in respect of contaminated land, and the related expense, is recognised when the land is contaminated.
(p) Inventories
Inventories are measured at the lower of cost and net realisable value. Net realisable value is the estimated selling
price in the ordinary course of business, less the estimated costs of completion and estimated costs necessary to
make the sale.
(q) Determination of fair values
A number of the Group’s accounting policies and disclosures require the determination of fair value for both financial
and non-financial assets and liabilities. Fair values have been determined for measurement and/or disclosure purposes
based on the following methods. When applicable, further information about the assumptions made in determining
fair values is disclosed in the notes specific to that asset or liability.
Investments in equity securities
The fair values of investments in equity securities are determined with reference to the quoted market price that is
most representative of the fair value of the security at the measurement date.
Share-based payment transactions
The fair value of the employee share options is measured using the Black-Scholes formula. Measurement inputs
include share price on measurement date, exercise price of the instrument, expected volatility (based on weighted
average historic volatility), expected dividends, and the risk-free interest rate (based on government bonds).
The grant-date fair value of share-based payment awards is recognised as an expense, with a corresponding increase
in equity, over the period that the recipient unconditionally become entitled to the awards. The amount recognised
as an expense is adjusted to reflect the number of awards for which the related service and non-market vesting
conditions are expected to be met, such that the amount ultimately recognised as an expense is based on the number
of awards that meet the related service and non-market performance conditions at the vesting date. For share-based
payment awards with non-vesting conditions, the grant date fair value of the share-based payment is measured to
reflect such conditions and there is no true-up for differences between expected and actual outcomes. Service and
non-market performance conditions are not taken into account in determining fair value.
(r) Assets held for sale, and discontinued operations
Assets held for sale
Non-current assets, or disposal groups comprising assets and liabilities, are classified as held-for-sale if it is highly
probably that they will be recovered primarily through sale rather than continuing use.
Immediately before classification as held-for-sale, the assets, or components of a disposal group, are remeasured in
accordance with the Group’s other accounting policies. Thereafter generally the assets, or disposal group, are measured
at the lower of their carrying amount and fair value less costs to sell. Any impairment loss on a disposal group is first
allocated to goodwill, and then to remaining assets and liabilities on a pro rata basis, except that no loss is allocated
to inventories, financial assets or deferred tax assets, which continue to be measured in accordance with the Group’s
other accounting policies. Impairment losses on initial classification as held-for-sale and subsequent gains or losses on
remeasurement are recognised in profit or loss. Gains are not recognised in excess of any cumulative impairment loss.
Once classified as held-for-sale, intangible assets and property, plant and equipment are no longer amortised or depreciated.
28
EQUUS MINING LIMITED Notes to the Consolidated
Financial Statements
For the Year Ended 30 June 2016
3. SIGNIFICANT ACCOUNTING POLICIES (Cont.)
(r) Assets held for sale, and discontinued operations (Cont.)
Discontinued operations
A discontinued operation is a component of the Group’s business, the operations and cash flows of which can be
clearly distinguished from the rest of the Group and which:
•
•
•
represents a separate major line of business or geographical area of operations;
is part of a single co-ordinated plan to dispose of a separate major line of business or geographical area of
operations; or
is a subsidiary acquired exclusively with a view to re-sale.
Classification as a discontinued operation occurs upon disposal or when the operation meets the criteria to be
classified as held-for-sale, if earlier.
When an operation is classified as a discontinued operation, the comparative Consolidated Statement of Profit or
Loss and Other Comprehensive Income is re-presented as if the operation had been discontinued from the start of the
comparative year.
(s) New standards and interpretations not yet adopted
A number of new standards, amendments to standards and interpretations are effective for annual periods beginning
after 1 July 2015, and have not been applied in preparing these financial statements. Those which may be relevant to
the Company are set out below. The Company does not plan to adopt these standards early.
AASB 9 Financial Instruments
AASB 9 replaces the existing guidance in AASB 139 Financial Instruments: Recognition and Measurement. AASB 9
includes revised guidance on the classification and measurement of financial instruments, including a new expected
credit loss model for calculating impairment on financial assets and the new general hedge accounting requirements.
It also carries forward the guidance on recognition and derecognition of financials instruments from AASB 139.
AASB 9 is effective for the Company’s annual reporting period beginning 1 July 2018 and can be early adopted. The
Company does not plan to adopt this standard early and the standard is not expected to have a significant effect on
the financial statements.
29
2016 Annual Report Notes to the Consolidated
Financial Statements
For the Year Ended 30 June 2016
4. LOSS FROM OPERATING ACTIVITIES
Continuing operations
Discontinued operations*
Revenue from ordinary
activities
2016
2015
$
-
$
-
2016
$
2015
$
Total
2016
$
Total
2015
$
1,043
7,756
1,043
7,756
The Group generated rental income from the provision of equipment from its subsidiary JSC Sherik
*Discontinued - see Note 28.
Other income
Recognised in profit or loss
Gain on sale of tenement interest
Other
Other expenses
Administration costs
Accounting and secretarial fees
Commissions
Insurance
ASIC and ASX fees
Share registry fees
Legal fees
Audit and review services – KPMG
Other services – KPMG
Other expenses
5. FINANCE INCOME AND FINANCE COSTS
Recognised in profit and loss
Interest income on cash deposits
Foreign exchange gain
2016
$
2015
$
-
3,517
3,517
279,883
13,335
293,218
25,585
58,237
29,809
14,234
24,403
12,074
846
76,900
8,500
46,151
296,739
32,871
61,220
37,500
10,269
17,159
22,078
46,885
86,750
-
98,569
413,301
3,570
7,988
11,558
12,283
53,120
65,403
Impairment of available-for-sale investments reclassified to profit or loss
Net finance income/(costs) recognised in profit or loss
(174,515)
(162,957)
(97,251)
(31,848)
Recognised in other comprehensive income
Net change in fair value of available-for-sale financial assets
(174,515)
(97,251)
Net change in fair value of available-for-sale financial assets reclassified
to profit or loss
Finance cost recognised in other comprehensive income, net of tax
174,515
97,251
-
-
30
EQUUS MINING LIMITED Notes to the Consolidated
Financial Statements
For the Year Ended 30 June 2016
2016
$
2015
$
6. INCOME TAX EXPENSE
Current tax expense
Current year
Overprovision in prior year
Losses not recognised
Numerical reconciliation of income tax expense to prima facie tax payable:
Loss before tax
Prima facie income tax benefit at the Australian tax rate of 30% (2015 - 30%)
Decrease in income tax benefit due to:
- non-deductible expenses
- overprovision in prior year
- tax losses not recognised
- effect of net deferred tax assets not brought to account
Income tax expense/(benefit)
Unrecognised deferred tax assets
Deferred tax assets have not been recognised in respect of the following items:
Capital losses
Tax losses
Net deductible temporary differences
Potential tax benefit at 30%
(163,599)
(18,289)
-
163,599
-
-
18,289
-
3,572,258
(1,071,677)
1,042,161
(312,648)
842,724
272,075
-
163,599
65,354
-
-
16,343
24,230
-
6,761,076
3,343,838
371,697
6,845,041
3,141,021
298,812
10,476,611
10,284,874
The deductible temporary differences and tax losses do not expire under current tax legislation. Deferred tax assets
have not been recognised in respect of these items because it is not probable that future taxable profit will be
available against which the Group can utilise the benefits there-from.
7. CASH AND CASH EQUIVALENTS
Cash at bank
Deposits at call
8. RECEIVABLES
Current
Sundry debtors
Trade and sundry debtors are non-interest bearing and generally on 30-day terms.
2016
$
88,010
31,251
119,261
2015
$
98,536
546,229
644,765
13,378
5,120
31
2016 Annual Report Notes to the Consolidated
Financial Statements
For the Year Ended 30 June 2016
9. OTHER ASSETS
Current
Prepayments
10. INVESTMENTS
2016
$
2015
$
2,023
6,014
Equity securities - available-for-sale at fair value
27,976
194,503
At 30 June 2016 the Directors compared the carrying value of the 1,861,150 shares held in Blox Inc., a US over the
counter traded company to market value and recorded a reduction in fair value within equity of $174,515 (2015 -
$97,251) based on a closing share price of US$0.011 at 30 June 2016. The decrease in fair value of $174,515 has been
reclassified in profit or loss. A foreign exchange gain of $7,988 has also been recorded on translation of the USD
investment.
11. EXPLORATION AND EVALUATION EXPENDITURE
Costs carried forward in respect of areas of interest in the following phases:
Carrying amount at the beginning of the year
Additions
Acquisitions (including non-controlling interest)
Foreign currency translation movement
Balance carried forward
2016
$
2015
$
1,073,712
467,568
-
(7,053)
43,092
665,924
353,545
11,151
1,534,227
1,073,712
The ultimate recoupment of exploration and evaluation expenditure is dependent on the successful development and
commercial exploitation, or alternatively sale of the respective areas of interest.
12. PROPERTY, PLANT AND EQUIPMENT
Furniture and fittings - at cost
Accumulated depreciation
Net book value
Office equipment - at cost
Accumulated depreciation
Net book value
Property – at cost
Accumulated depreciation
Net book value
Total property, plant and equipment net book value
32
2016
$
2015
$
1,892
(1,892)
-
2,785
(2,785)
-
1,892
(955)
937
2,785
(2,785)
-
192,710
192,710
(192,710)
(192,710)
-
-
-
937
EQUUS MINING LIMITED Notes to the Consolidated
Financial Statements
For the Year Ended 30 June 2016
2016
$
2015
$
937
-
(937)
70,819
(70,819)
-
-
1,775
-
(862)
-
-
24
937
428,142
7,362
435,504
216,025
13,352
229,377
12. PROPERTY, PLANT AND EQUIPMENT (Cont.)
Reconciliation:
Carrying amount at the beginning of the year
Disposals
Depreciation
Impairment reversal
Transfer to assets held for sale
Foreign currency translation movement
Carrying amount at the end of the year
13. TRADE AND OTHER PAYABLES
Current liabilities
Trade creditors and accruals
Employee leave entitlements
14. ISSUED CAPITAL
434,873,094 (2015: 379,295,675) fully paid ordinary shares
108,545,219
107,814,973
2016
2015
Nº
$
Nº
$
Fully paid ordinary shares
Balance at beginning of financial year
379,295,675
107,814,973
256,661,675
106,622,162
Issued ordinary shares 28 August 2014 for $0.01
Issued ordinary shares 2 September 2014 for $0.01
Issued ordinary shares 3 October 2014 for $0.01
Issued ordinary shares 16 January 2015 for $0.01
Issued ordinary shares 3 March 2015 for $0.01
Less cost of issue
Issued ordinary shares 31 July 2015 – non-cash1
Issued ordinary shares 19 October 2015 for $0.011
Issued ordinary shares 16 December 2015 for $0.011
Less cost of issue
-
-
-
-
-
-
-
-
-
-
-
-
16,000,000
36,213,783
3,363,636
-
320,000
398,352
37,000
(25,106)
52,100,000
22,500,000
12,534,000
30,500,000
5,000,000
-
-
-
-
-
521,000
225,000
125,340
305,000
50,000
(33,529)
-
-
-
-
434,873,094
108,545,219
379,295,675
107,814,973
1 Shares issued on 31 July 2015 relate to the acquisition of the remaining 49% shareholding in Andean Coal Pty Ltd.
Refer Note 29.
Fully paid ordinary shares carry one vote per share and carry the right to dividends.
Holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one vote
per share at the shareholders meetings. In the event of winding up of the Company, ordinary shareholders rank after
creditors and are fully entitled to any proceeds of liquidation.
33
2016 Annual Report Notes to the Consolidated
Financial Statements
For the Year Ended 30 June 2016
15. RESERVES
Equity based compensation reserve (a)
Foreign currency translation reserves (b)
Movements during the period:
(a) Equity based compensation reserve
Balance at beginning of period
Expired options
Balance at end of period
(b) Foreign currency translation reserves
Balance at beginning of period
2015
$
2014
$
-
144,000
(465,579)
(3,292,727)
(465,579)
(3,148,727)
144,000
(144,000)
-
164,700
(20,700)
144,000
(3,262,982)
(3,292,727)
Transfer of foreign currency translation reserve to loss on disposal of subsidiary in
profit or loss – discontinued operations
Transfer of foreign currency translation reserve to gain on disposal of subsidiary in
profit or loss
2,976,499
(177,981)
-
-
Currency translation differences
Balance at end of period continuing operations
Nature and purpose of reserves
(1,115)
29,745
(465,579)
(3,262,982)
Equity based compensation reserve:
The equity based compensation reserve is used to record the fair value of options issued but not exercised.
Foreign currency translation reserve:
The foreign currency translation reserve records the foreign currency differences arising from the translation of the
financial statements of foreign operations where their functional currency is different to the presentation currency of
the reporting entity.
34
EQUUS MINING LIMITED Notes to the Consolidated
Financial Statements
For the Year Ended 30 June 2016
16. LOSS PER SHARE
2016
2015
Continuing
operations
Discontinued
operations
$
$
Continuing
operations
Discontinued
operations
$
$
Total
$
Total
$
Basic and diluted profit/(loss) per share:
Net profit/(loss) for the year attributable
to equity holders of the parent
(596,120)
(2,977,730)
(3,573,850)
(569,087)
(479,561)
(1,048,648)
Weighted average number of ordinary shares (basic and diluted)
Issued ordinary shares at beginning of year
Effect of shares issued (Note 14)
Weighted average ordinary shares at the end of the year
2016
2015
379,295,675
256,661,675
41,686,205
86,922,685
420,981,880 343,584,360
As the Group is loss making, none of the potentially dilutive securities are currently dilutive in the calculation of total
earnings per share.
17. RECONCILIATION OF CASH FLOWS FROM OPERATING ACTIVITIES
Cash flows from operating activities
Loss for the year
Non-cash items
Depreciation
Impairment of available for sale financial assets
Impairment/(reversal of impairment) of property, plant and equipment
Foreign currency exchange loss/(gain)
Gain on disposal of subsidiary
Loss on sale of subsidiary, net of cash
Changes in assets and liabilities
Decrease/(increase) in receivables
Decrease/(increase) in other assets
(Decrease)/Increase in payables
(Decrease)/Increase in other liabilities
Net cash used in operating activities
Reconciliation of cash
2016
$
2015
$
(3,572,258)
(1,042,161)
937
174,515
(70,819)
(7,988)
(177,917)
2,976,499
(8,258)
3,991
170,601
(5,990)
862
97,251
494,266
(53,120)
-
-
20,187
(183,034)
(152,190)
(9,586)
(516,687)
(827,525)
For the purposes of the statement of cash flows, cash includes cash on hand and at
bank and cash on deposit net of bank overdrafts and excluding security deposits. Cash
at the end of the financial year as shown in the statement of cash flows is reconciled to
the related items in the statement of financial position as follows:
Cash and cash equivalents
119,261
644,765
35
2016 Annual Report Notes to the Consolidated
Financial Statements
For the Year Ended 30 June 2016
18. RELATED PARTIES
Parent and ultimate controlling party
Equus Mining Limited is both the parent and ultimate controlling party of the Group.
Key management personnel and director transactions
During the year ended 30 June 2016, No key management persons, or their related parties, held positions in other
entities that result in them having control or joint control over the financial or operating policies of those entities.
During the year ended 30 June 2015, Norman A. Seckold had control over an entity, Mining Services Trust, which
provided full administrative services, including rental accommodation, administrative staff, services and supplies, to
the Group. Fees paid to Mining Services Trust during the year ended 30 June 2015 amounted to $240,000.
19. KEY MANAGEMENT PERSONNEL DISCLOSURES
Information regarding individual key management personnel’s compensation and some equity instruments
disclosures as permitted by Corporations Act and Corporations Regulations 2M.3.03 are provided in the Remuneration
Report section of the Director’s Report.
Key management personnel compensation
Primary fees/salary
Superannuation
2016
$
238,370
17,100
255,470
2015
$
210,080
16,319
226,399
At 30 June 2016 $114,862 of fees were outstanding including superannuation (2015 - Nil). The key management
personnel to which outstanding amounts are owed have signed confirmations agreeing to defer settlement of these
amounts until such time as the Company has sufficient working capital to make repayment. There were no loans made
to key management personnel or their related parties during the 2016 and 2015 financial years.
The Board reviews remuneration arrangements annually based on services provided. Apart from the details disclosed
in this note, there were no material contracts involving Directors’ interest’s existing at year-end.
36
EQUUS MINING LIMITED Notes to the Consolidated
Financial Statements
For the Year Ended 30 June 2016
20. SHARE BASED PAYMENTS
The Company makes share based payments to consultants and/or service providers from time to time, not under any
specific plan. The Company also may issue options to directors of the parent entity. Specific shareholder approval is
obtained for any share based payments to directors of the parent entity.
Options outstanding at 30 June 2016
There were no options outstanding at 30 June 2016.
Movement of options during the year ended 30 June 2016
Grant date
13 November 2012
13 November 2012
13 November 2012
13 November 2012
Outstanding at
the beginning
of the year
Granted
during
the year
Cancelled
during
the year
Exercised
during
the year
Expired
during
the year
Outstanding
at the end
of the year
Exercisable
at the end
of the year
1,000,000
1,000,000
1,000,000
1,000,000
4,000,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(1,000,000)
(1,000,000)
(1,000,000)
(1,000,000)
(4,000,000)
-
-
-
-
-
-
-
-
-
-
Options outstanding at 30 June 2015
Grant date
13 November 2012
13 November 2012
13 November 2012
13 November 2012
Number of
options
Exercise
price
Fair value at
grant date
Vesting
Date
Expiry date
1,000,000
1,000,000
1,000,000
1,000,000
$0.075
$0.150
$0.200
$0.250
$0.044
$0.037
$0.033
$0.030
31 March 2013
13 November 2015
31 March 2013
13 November 2015
31 March 2013
13 November 2015
31 March 2013
13 November 2015
Movement of options during the year ended 30 June 2015
Grant date
Outstanding at
the beginning
of the year
Granted
during
the year
Cancelled
during
the year
Exercised
during
the year
Expired
during
the year
Outstanding at
the end of
the year
Exercisable at
the end of
the year
13 November 2012
1,000,000
13 November 2012
1,000,000
13 November 2012
1,000,000
13 November 2012
1,000,000
4,000,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
4,000,000
4,000,000
37
2016 Annual Report Notes to the Consolidated
Financial Statements
For the Year Ended 30 June 2016
21. FINANCIAL RISK MANAGEMENT AND FINANCIAL INSTRUMENTS DISCLOSURE
The Group’s financial instruments comprise deposits with banks, receivables, trade and other payables and from time
to time short term loans from related parties. The Group does not trade in derivatives.
The main risks arising from the Group’s financial instruments are market risk, credit risk and liquidity risks. This note
presents information about the Group’s exposure to each of these risks, its objectives, policies and processes for
measuring and managing risk, and the Group’s management of capital.
Risk management framework
The Board of Directors has overall responsibility for the establishment and oversight of the Group’s risk management
framework. Risk management policies are established to identify and analyse the risks faced by the Group, to set
appropriate risk limits and controls, and to monitor risks and adherence to limits. These policies are reviewed regularly
to reflect changes in market conditions and the Group’s activities. The primary responsibility to monitor the financial
risks lies with the Managing Director and the Company Secretary under the authority of the Board.
Liquidity risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligation as they fall due. The Group’s
approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet
its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking
damage to the Group’s reputation.
The Group monitors rolling forecasts of liquidity based on expected fund raisings, trade payables and other obligations
for the ongoing operation of the Group. At balance date, the Group has available funds of $119,261 for its immediate use.
The following are the contractual maturities of financial liabilities:
Financial liabilities
Trade and other payables
30 June 2016
30 June 2015
Carrying
amount
Contractual
cash flows
Less than
6 months
6 to 12
months
1 to 5
years
More than
5 years
$
$
$
435,504
229,377
(435,504)
(435,504)
(229,377)
(229,377)
$
-
-
$
-
-
$
-
-
It is not expected that the cash flows included in the maturity analysis could occur significantly earlier, or at
significantly different amounts.
Credit risk
Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet
its contractual obligations.
The carrying amount of the Group’s financial assets represents the maximum credit risk exposure as follows:
Cash and cash equivalents
Receivables
Cash and cash equivalents
2016
$
119,261
13,378
132,639
2015
$
644,765
5,120
649,885
At 30 June 2016, the Group held cash and cash equivalents of $119,261 (2015: $644,765), which represents its maximum
credit exposure on these assets. The cash and cash equivalents are held with reputable banks and financial institution
counterparties, which are rated AA- to AAA+, based on rating agency ‘Moody’s rating’.
38
EQUUS MINING LIMITED Notes to the Consolidated
Financial Statements
For the Year Ended 30 June 2016
21. FINANCIAL RISK MANAGEMENT AND FINANCIAL INSTRUMENTS DISCLOSURE (Cont.)
Credit risk (Cont.)
Receivables
For the year ended 30 June 2016, the Group does not hold a significant value of trade receivables, and therefore has
minimal exposure to credit risk.
Market risk
Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will
affect the Group’s income or the value of its holdings of financial instruments. The objective of market risk management
is to manage and control market risk exposures within acceptable parameters, while optimising the return.
Interest Rate Risk
The Group’s income statement is affected by changes in interest rates due to the impact of such changes on interest
income and expenses.
At year-end, the interest rate risk profile of the Group’s interest bearing financial instruments was:
Cash and cash equivalents
There are no fixed rate instruments (2015 - $nil).
2016
$
2015
$
119,261
664,765
The Group does not have interest rate swap contracts. The Group has two interest bearing accounts from where it
draws cash when required to pay liabilities as they fall due. The Group normally invests its funds in the two interest
bearing accounts to maximise the available interest rates. The Group analyses its interest rate exposure when
considering renewals of existing positions including alternative financing arrangements.
Sensitivity analysis
A change of 100 basis points in interest rates at the current and prior reporting date would have increased/(decreased)
equity and loss for the period by an immaterial amount.
Currency risk
The Group has a bank account denominated in USD totalling $59,676 at 30 June 2016 (2015 – Nil). Changes in the United
States to the Australian dollar do not result in any significant impact in the profit or loss for the consolidated Group in
relation to the 30 June 2016 USD bank account balance, and therefore the Group has minimal exposure to currency risk.
Price risk
The Group is exposed to equity securities prices risk. This arises from investments held by the Group and classified in
the balance sheet as available-for-sale.
The Group’s investments are publicly traded on the Over-The-Counter-Market (‘OTC market’) in the USA.
The table below summarises the impact of increases/decreases of the bid price on the Group’s post-tax profit for the
year and on equity
Blox-Inc. - 10% bid price increase
Blox-Inc. - 10% bid price decrease
Impact on post-tax profit
Impact on other components
of equity
2016
$
2,798
(2,798)
2015
$
19,450
(19,450)
2016
$
2,798
(2,798)
2015
$
19,450
(19,450)
39
2016 Annual Report Notes to the Consolidated
Financial Statements
For the Year Ended 30 June 2016
21. FINANCIAL RISK MANAGEMENT AND FINANCIAL INSTRUMENTS DISCLOSURE (Cont.)
Capital management
Management controls the capital of the Group in order to maintain an appropriate debt to equity ratio, provide the
shareholders with adequate returns and ensure that the Group can fund its operations and continue as a going concern.
The Group’s capital includes ordinary share capital supported by financial assets. There are no externally imposed
capital requirements on the Group.
Management effectively manages the Group’s capital by assessing the Group’s financial risks and adjusting its capital
structure in response to changes in these risks and in the market. These responses include the management of cash
levels, distributions to shareholders and share issues.
There have been no changes in the strategy adopted by management to control the capital of the Group since the
prior year.
Estimation of Fair Values
The carrying amounts of financial assets and financial liabilities included in the balance sheet approximate fair values.
The table below analyses financial instruments carried at fair value, by valuation method. The different levels have
been defined as follows:
•
•
•
Level 1 - fair value measurements are those instruments valued based on quoted prices (unadjusted) in active
markets for identical assets or liabilities.
Level 2 - fair value measurements are those instruments valued based on inputs other than quoted prices
included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e.
derived from prices).
Level 3 - fair value measurements are those instruments valued based on inputs for the asset or liability that are
not based on observable market data (unobservable inputs).
Available-for-sale financial assets
30 June 2016
30 June 2015
Level 1
Level 2
Level 3
$
-
194,503
$
27,976
-
$
-
-
Total
$
27,976
194,503
All available for sale financial assets relate to investments held in quoted equity securities and were designated as
available-for-sale financial assets.
Transfers between Levels 1 and 2
At 30 June 2016, available-for-sale investments with a carrying value of $27,976 were transferred from Level 1 to Level
2 because the market for such securities was no longer considered to be active and quoted prices were no longer
considered to be regularly available.
40
EQUUS MINING LIMITED Notes to the Consolidated
Financial Statements
For the Year Ended 30 June 2016
22. CONTROLLED ENTITIES
Parent entity
Equus Mining Limited is an Australian incorporated company listed on the Australian Securities Exchange.
(i) Subsidiaries of Textonic Consulting Limited
JSC Sherik
Kyrgyz Republic
-
Wholly owned controlled entities
Hotrock Enterprises Pty Ltd (ii)
Okore Mining Pty Ltd (iii)
Dataloop Pty Ltd
Textonic Consulting Limited (i)
Equus Resources Limited (iv)
(ii) Subsidiary of Hotrock Enterprises Pty Ltd
Derrick Pty Ltd
Andean Coal Pty Ltd (vii)
(vii) Subsidiary of Andean Coal Pty Ltd
Minera Carbones Del Sur Limitada
(iii) Subsidiary of Okore Mining Pty Ltd
Leo Shield Exploration Ghana Ltd
(iv) Subsidiary of Equus Resources Limited
Equus Resources Chile SpA (v)
Minera Equus Chile Ltda
(v) Subsidiary of Equus Resources Chile SpA
Minera Equus Chile Ltda
%
100
100
100
100
100
100
100
51
Country of
incorporation
Ownership Interest
2016
2015
Australia
Australia
Australia
Canada
Australia
%
100
100
100
-
100
Australia
Australia
100
100
Chile
Ghana
Chile
Chile
Chile
99.9
99.9
100
100
99.9
0.1
100
100
99.9
0.1
On 31 July 2015, the Company, under the terms of the Share Subscription Deed, exercised the option to acquire the
remaining 49% interest in Andean Coal Pty Ltd for the consideration of 16,000,000 ordinary shares in Equus (refer Note 29).
On 17 March 2016, Textonic Consulting Limited sold 100% of the share capital in its subsidiary entity JSC Sherik for
consideration of KGS100,000 (AUD$2,000).
On 11 May 2016, Textonic Consulting Limited was deregistered.
23. COMMITMENTS
Exploration expenditure commitments
The Group does not have any minimum expenditure commitments in relation to its mineral interests in the
Magallanes Basin in southern Chile at the date of this report. The Group’s mineral interests in West Africa are subject
to farm-in and joint venture agreements, under the terms of which the farm-in partners are responsible for the annual
rates and rents relating to those properties.
41
2016 Annual Report Notes to the Consolidated
Financial Statements
For the Year Ended 30 June 2016
24. OPERATING SEGMENTS
The Group’s chief operating decision maker has considered the requirements of AASB 8, Operating Segments, and has
concluded that, during the year ended 30 June 2016, the Group operated in the mineral exploration and the oil exploration
industry within the geographical segments of Australia, Chile, Ghana and Kyrgyz Republic. The oil exploration segment
was discontinued during the year ended 30 June 2013 and JSC Sherik was disposed of on 17 March 2016.
30 June 2016
External revenues
Oil
Exploration
(discontinued)
Mineral
Exploration
Investing
$
$
$
Total
$
1,043
-
-
1,043
Reportable segment profit /(loss) before tax
(2,977,730)
42,888
(163,017)
(3,097,859)
Interest income
Interest expense
Depreciation
Other material non-cash items:
Impairment of investment
Reversal impairment plant and equipment
Reportable segment assets
Reportable segment liabilities
30 June 2015
External revenues
-
-
-
-
-
-
-
60
-
(937)
3,510
-
-
3,570
-
(937)
-
(174,515)
70,819
-
(174,515)
70,819
1,617,432
16,409
7,756
-
27,976
1,645,408
-
-
16,409
7,756
Reportable segment loss before tax
(479,561)
(50,543)
247,909
(282,195)
Interest income
Interest expense
Depreciation
Other material non-cash items:
Impairment of investment
Reportable segment assets
Reportable segment liabilities
-
-
-
-
126
-
(862)
12,157
12,283
-
-
-
(862)
-
(97,251)
(97,251)
28,557
37,233
1,137,282
194,644
1,360,483
27,257
-
64,490
Reconciliations of reportable segment revenues and profit or loss
Revenues
Total revenue for reportable segments
Elimination of discontinued operations disposed (Note 28)
Consolidated revenue
2016
$
1,043
(1,043)
-
2015
$
7,756
(7,756)
-
42
EQUUS MINING LIMITED 24. OPERATING SEGMENTS (Cont.)
Reconciliations of reportable segment revenues and profit or loss (Cont.)
Profit or loss
Total loss for reportable segments
Elimination of discontinued operations (Note 28)
Unallocated amounts:
Proceeds from other income
Net other corporate expenses
Consolidated loss before tax from continuing operations
Assets
Total assets for reportable segments
Unallocated corporate assets
Consolidated total assets
Liabilities
Total liabilities for reportable segments
Unallocated corporate liabilities
Consolidated total liabilities
Geographical information
Notes to the Consolidated
Financial Statements
For the Year Ended 30 June 2016
2016
$
2015
$
(3,097,859)
(282,195)
2,977,730
479,561
3,517
9,130
(477,916)
(769,096)
(594,528)
(562,600)
2016
$
2015
$
1,645,408
1,360,483
122,276
564,568
1,767,684
1,925,051
16,409
419,095
435,504
64,490
164,887
229,377
In presenting information on the basis of geography, segment revenue and segment assets are based on the
geographical location of the operations.
Australia
All foreign locations
- Kyrgyz Republic
- Ghana
- Chile
2016
2015
Revenue
$
Non-current
assets
$
-
1,043
-
-
-
-
-
1,337,589
Revenues
$
-
7,756
-
-
Non-current
assets
$
-
-
937
877,075
The geographical information excludes financial instruments in determining non-current assets.
25. SUBSEQUENT EVENTS
No matters or circumstances have arisen in the interval between the end of the financial year and the date of this
report any item, transaction or event of a material or unusual nature likely, in the opinion of the Directors of the
Company, to affect significantly the operations of the Group, the results of those operations, or the state of affairs of
the Group, in future financial years.
43
2016 Annual Report Notes to the Consolidated
Financial Statements
For the Year Ended 30 June 2016
26. PARENT ENTITY DISCLOSURES
As at, and throughout, the financial year ending 30 June 2016 the parent entity of the Group was Equus Mining Limited.
Result of the parent entity
Net (loss)/profit
Other comprehensive income
Total comprehensive profit/(loss)
Financial position of the parent entity at year end
Current assets
Non-current assets
Total assets
Current liabilities
Non-current liabilities
Total liabilities
Net assets
Equity
Share capital
Accumulated losses
Fair value reserve
Equity based compensation reserve
Option premium reserve
Total equity
Company
2016
$
2015
$
(1,449,415)
(454,689)
-
-
(1,449,415)
(454,689)
122,276
27,976
150,252
564,709
194,503
759,212
419,096
164,887
-
419,096
(268,844)
-
164,887
594,325
108,545,219
107,814,973
(108,814,063)
(107,364,648)
-
-
-
-
144,000
-
(268,844)
594,325
The Directors are of the opinion that no contingencies existed at, or subsequent to year end.
27. ASSETS HELD FOR SALE
The Naltagua property held in the Republic of Chile which is within the mining exploration segment of the Group has
been presented as assets held for sale following Group management’s decision to sell the property.
A Sale and Purchase Agreement was executed during July 2016. The consideration under the agreement was for CLP$38
million (AUD$76,889). This asset was not classified as assets held for sale at 30 June 2015.
As at 30 June assets held for sale comprised the following:
2016
$
2015
$
Property, plant and equipment – Land
70,819
-
During the year ended 30 June 2016, the Group determined to reverse $70,819 of the impairment processed during 2014
for the Naltagua property. No impairment/reversal was recorded in the prior year.
44
EQUUS MINING LIMITED Notes to the Consolidated
Financial Statements
For the Year Ended 30 June 2016
28. DISCONTINUED OPERATIONS
In September 2012 the Group committed to discontinue its oil exploration segment. On 6 February 2015 the Group sold
the segment fixed assets and consumables for US$700,000. On 17 March 2016 the Group sold its 100% interest in JSC
Sherik for consideration of KGS100,000 (AUD$2,000).
Results of discontinued operation
Revenue
Other income
Expenses
Results from operating activities
Income tax expense
Results from operating activities, net of income tax
Loss on sale of discontinue operation (including transfer of foreign currency
translation reserve to profit or loss)
Impairment of assets held for sale
Income tax on loss on sale of discontinued operation
Loss for the year
2016
$
2015
$
1,043
113,410
7,756
211,277
(115,684)
(204,328)
(1,231)
14,705
-
-
(1,231)
14,705
(2,976,499)
-
-
-
(494,266)
-
(2,977,730)
(479,561)
Basic and diluted loss per share
(0.007)
(0.001)
Cash flows from (used in) discontinued operation
Net cash used in operating activities
Net cash from investing activities
Net cash from financing activities
Net cash flows for the year
29. ACQUISITION OF CONTROLLED ENTITIES
(96,182)
(201,455)
1,043
183,660
-
-
(95,139)
(17,795)
On 1 November 2014, the Company acquired a 51% interest in Andean Coal Pty Ltd (‘Andean’). The Company paid
$200,000 for exploration and administration expenditure relating to Andean’s subsidiary Minera Carbones Del Sur
Limitada, a company incorporated in Chile. Minera Carbones Del Sur Limitada holds exploration licences covering
three projects, Mina Rica, Rubens and Perez in the Magallanes Basin in southern Chile.
On 31 July 2015 the Company, under the terms of the Share Subscription Deed, exercised the option to acquire the
remaining 49% of Andean for the consideration of 16 million ordinary shares in Equus (refer Note 14).
45
2016 Annual Report Directors’ Declaration
1. In the opinion of the Directors of Equus Mining Limited (the ‘Company’):
(a) the consolidated financial statements and notes thereto, set out on pages 16 to 45, and the Remuneration
Report as set out on pages 11 to 14 of the Directors’ Report are 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 2016 and of its performance, for
the financial year ended on that date;
(ii) complying with Australian Accounting Standards and the Corporations Regulations 2001; and
(b) there are reasonable grounds to believe that the Company will be able to pay its debts as and when they
become due and payable.
2. The Directors have been given the declarations required under section 295A of the Corporations Act 2001 for the
financial year ended 30 June 2016.
3. The Director’s draw attention to Note 2(a) to the consolidated financial statements, which includes a statement of
compliance with International Financial Reporting Standards.
Signed at Sydney this 15th day of September 2016 in accordance with a resolution of the Board of Directors:
Mark H. Lochtenberg
Director
Edward J. Leschke
Director
46
EQUUS MINING LIMITED Independent Auditor’s Report
Report on the financial report
We have audited the accompanying financial report of Equus Mining Limited (the ‘Company’), which comprises the
Consolidated Statement of Financial Position as at 30 June 2016, and Consolidated Statement of Profit or Loss and
Other Comprehensive Income, Consolidated Statement of Changes in Equity and Consolidated Statement of Cash
Flows for the year ended on that date, Notes 1 to 29 comprising a summary of significant accounting policies and
other explanatory information and the directors’ declaration of the Group comprising the Company and the entities it
controlled at the year’s end or from time to time during the financial year.
Directors’ responsibility for the financial report
The directors of the Company are responsible for the preparation of the financial report that gives a true and fair
view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control
as the directors determine is necessary to enable the preparation of the financial report that is free from material
misstatement whether due to fraud or error. In Note 2(a), the directors also state, in accordance with Australian
Accounting Standard AASB 101 Presentation of Financial Statements, that the financial statements of the Group
comply with International Financial Reporting Standards.
Auditor’s responsibility
Our responsibility is to express an opinion on the financial report based on our audit. We conducted our audit in
accordance with Australian Auditing Standards. These Auditing Standards require that we comply with relevant
ethical requirements relating to audit engagements and plan and perform the audit to obtain reasonable assurance
whether the financial report is free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial
report. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material
misstatement of the financial report, whether due to fraud or error. In making those risk assessments, the auditor
considers internal control relevant to the entity’s preparation of the financial report that gives a true and fair view in
order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of
accounting policies used and the reasonableness of accounting estimates made by the directors, as well as evaluating
the overall presentation of the financial report.
We performed the procedures to assess whether in all material respects the financial report presents fairly, in
accordance with the Corporations Act 2001 and Australian Accounting Standards, a true and fair view which is
consistent with our understanding of the Group’s financial position and of its performance.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Independence
In conducting our audit, we have complied with the independence requirements of the Corporations Act 2001.
Auditor’s opinion
In our opinion:
(a) the 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 2016 and of its performance for the
year ended on that date; and
(ii) complying with Australian Accounting Standards and the Corporations Regulations 2001; and
(b) the financial report also complies with International Financial Reporting Standards as disclosed in Note 2(a).
KPMG, an Australian partnership and a member firm of the KPMG
network of independent member firms affiliated with KPMG International
Cooperative (“KPMG International”), a Swiss entity.
Liability limited by a scheme approved under
Professional Standards Legislation.
47
2016 Annual Report Independent Auditor’s Report
Material uncertainty regarding continuation as a going concern
Without modifying our opinion, we draw attention to Note 2(d), “Going Concern”, in the financial report. The
conditions disclosed in Note 2(d), including the need to raise additional funding from shareholders or other parties,
the Group reducing expenditure in-line with available funding and related parties continuing to defer settlement of
liabilities, indicate the existence of a material uncertainty which may cast significant doubt about the Group’s ability
to continue as a going concern and, therefore, whether it will realise its assets and extinguish its liabilities in the
normal course of business and at the amounts stated in the financial report.
Report on the remuneration report
We have audited the Remuneration Report included in pages 11 to 14 of the Directors’ Report for the year ended 30
June 2016. 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 auditing standards.
Auditor’s opinion
In our opinion, the Remuneration Report of Equus Mining Limited for the year ended 30 June 2016 complies with
Section 300A of the Corporations Act 2001.
KPMG
15 September 2016
Adam Twemlow
Partner
Brisbane
48
EQUUS MINING LIMITED Additional Stock Exchange Information
Additional information as at 31 August 2016 required by the Australian Stock Exchange Listing Rules and not disclosed
elsewhere in this report.
Home Exchange
The Company is listed on the Australian Stock Exchange. The Home Exchange is Sydney.
Audit Committee
As at the date of the Directors’ Report, an audit committee of the Board of Directors is not considered warranted due
to the composition of the Board and the size, organisational complexity and scope of operations of the Group.
Class of Shares and Voting Rights
The voting rights attached to ordinary shares, as set out in the Company’s Constitution, are that every member in
person or by proxy, attorney or representative, shall have one vote on a show of hands and one vote for each share
held on a poll.
A member holding partly paid shares is entitled to a fraction of a vote equivalent to the proportion, which the amount
paid up bears to the issue price for the share.
Distribution of Shareholders
The total distribution of fully paid shareholders as at 31 August 2016 was as follows:
Range
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 and over
Total
Total
Shareholders
268
336
340
680
284
1,908
Total
Number of
Shares
126,621
966,984
3,080,392
22,372,401
408,326,696
434,873,094
Less than Marketable Parcels
On 31 August 2016, 1,513 shareholders held less than marketable parcels of 55,555 shares.
On Market Buy Back
There is no current on-market buy-back.
Substantial Holders
The name of the substantial shareholders in Equus Mining Limited as advised to the Company are set out below.
Permgold Pty Ltd
Augusta Enterprises Pty Ltd
Mark Lochtenberg
Number of Ordinary Shares
34,377,420
33,619,471
22,306,727
49
2016 Annual Report Additional Stock Exchange Information
Twenty Largest Shareholders
As at 31 August 2016, the twenty largest quoted shareholders held 54.35% of the fully paid ordinary shares as follows:
Name
Number
%
Permgold Pty Ltd
Augusta Enterprises Pty Ltd
34,377,420
33,619,471
Mark Hamish Lochtenberg & Michael Lochtenberg
22,306,727
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
JP Morgan Nominees Australia Limited
HSBC Custody Nominees (Australia) Limited
Sambas Energy Pty Ltd
Peter John Bartter
Cynthia Wardman
Annlew Investments Pty Ltd < Annlew Investments PL SF A/C>
John Wardman & Associates Pty Ltd
Tetramin Pty Ltd
Lewis Super Admin Pty Limited
John Desmond Martin
Rosignol Pty Ltd
DRYCA Pty Ltd
Citicorp Nominees Pty Limited
Peter David Koller
Colvic Pty Ltd
CRX Investments Pty Limited
20
Glen Whisson & Tania Whisson
The number of holders in each class of securities
7.91
7.73
5.10
4.82
4.20
3.68
3.45
2.53
1.92
1.86
1.84
1.19
1.15
1.15
1.15
1.07
1.04
0.83
0.82
0.81
20,966,501
18,553,602
16,000,000
15,000,000
11,000,000
8,361,112
8,096,566
8,000,000
5,192,384
5,000,000
5,000,000
5,000,000
4,653,266
4,500,000
3,600,000
3,582,943
3,562,976
As at 31 August 2016, the numbers of holders in each class of securities on issue were as follows:
Type of security
Ordinary shares
Escrow securities
As at 31 August 2016, there were escrow securities.
Number of
holders
Number of
securities
1,908
434,873,094
50
EQUUS MINING LIMITED Additional Stock Exchange Information
Group Mineral Concession Interests at 31 August 2016
The Company provides the following information regarding its mining tenements:
Project
Mina Rica
Rubens
Location
Tenement
Ownership
% interest Type of Tenement
Chile Mina Rica 1
Chile Mina Rica 2
Chile Mina Rica 4
Chile Mina Rica 6
Chile Mina Rica 8
Chile Mina Rica 11
Chile Mina Rica 12
Chile Mina Rica 15
Chile Mina Rica 16
Chile Mina Rica 19
Chile Mina Rica 20
Chile Mina Rica 23
Chile Mina Rica 26
Chile Mina Rica 29
Chile Mina Rica 30
Chile Mina Rica 31
Kol 1
Chile
Kol 2
Chile
Kol 3
Chile
Kol 4
Chile
Kol 5
Chile
Kol 6
Chile
Kol 7
Chile
Kol 8
Chile
Kol 9
Chile
Kol 10
Chile
Kol 11
Chile
Kol 12
Chile
Kol 14
Chile
Kol 15
Chile
Kol 16
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Rio Rubens Este 1
Rio Rubens Este 2
Rio Rubens Este 3
Rio Rubens Este 4
Rio Rubens Este 5
Rio Rubens Este 6
Rio Rubens Este 7
Rio Rubens 1
Rio Rubens 2
Rio Rubens 3
Rio Rubens 4
Rio Rubens 5
Rio Rubens 6
Rio Rubens 7
Rio Rubens 8
Rio Rubens 9
Rio Rubens 10
Rio Rubens 11
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
51
2016 Annual Report Additional Stock Exchange Information
Location
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Chile
Tenement
Ownership
% interest Type of Tenement
Rio Perez A
Rio Perez B
Rio Perez C
Rio Perez D
Rio Perez E
Rio Perez F
Rio Perez G
Rio Perez H
Skyring 1
Skyring 2
Skyring 3
Skyring 4
Skyring 5
Skyring 6
Skyring 7
Skyring 8
Skyring 9
Skyring 10
Skyring 11
Skyring 12
Skyring 13
Skyring 14
Skyring 15
Skyring 16
Skyring 17
Skyring 18
Skyring 19
Skyring 20
Skyring 21
Skyring 22
Skyring 23
Skyring 24
Skyring 25
Skyring 26
Skyring 27
Skyring 28
Skyring 29
Skyring 30
Skyring 31
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
Minera Carbones Del Sur Limitada
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Exploration
Project
Perez
52
EQUUS MINING LIMITED
Additional Stock Exchange Information
Mining interest in African countries
Concession
name
Osenase
Asamankese
Pramkese
Kwatechi
Location
Registered Holder
File Number /
Licence Type
Equus equity
interest
Concession
Type
Ghana 1
Ghana 1
Ghana 1
Ghana 1
Osenase Prospecting Licence
Equus Mining 90%
Asamankese Prospecting Licence
Equus Mining 90%
Pramkese Prospecting Licence
Equus Mining 90%
Kwatechi PL3/64 Prospecting Licence
Equus Mining 0%
N/A
N/A
N/A
7% 2
Exploration
Exploration
Exploration
Exploration
Notes
1
2
The governments of African countries in which the Company holds minerals interests are entitled to equity
in mining companies owning projects as follows – Ghana 10% and Guinea 15%. Equus’s quoted equity is
after allowance for that national interest, which occurs when a new project company is established prior to
commencement of mining.
Perseus Mining Limited, the current holder of a 16% interest, has the right to earn a further 60% interest in
the Kwatechi property by funding the development of the project to profitable production. In that case,
the Company and a local joint venture partner will each retain a 7% interest which is convertible to a 1.25%
net smelter royalty at the option of those parties within 30 days of completion of a feasibility study.
2016 Annual Report
53
www.equusmining.com
NOTICE OF ANNUAL GENERAL MEETING
Notice is hereby given that the Annual General Meeting of members is to be convened at Level 5, 56 Pitt
Street, Sydney, NSW, 2000 on 22 November 2016 at 11 am.
ORDINARY BUSINESS
Financial Statements
AGENDA
To receive and consider the Company's Annual Financial Report, the Directors' Report and the Auditor's
Report for the year ended 30 June 2016.
To consider and, if thought fit, pass the following resolutions, with or without amendment:
Resolution 1 Adoption of the Remuneration Report
'That the Remuneration Report for the year ended 30 June 2016 be and is hereby adopted.'
Resolution 2
Re-election of a Director
'That Juerg M. Walker be and is hereby re-elected as a Director.'
Resolution 3 Additional capacity to issue securities
'That the additional capacity to issue equity securities up to 10% of the issued capital of the Company as
set out in the Explanatory Memorandum attached to this Notice of Meeting be and is hereby approved
for the purposes of ASX Listing Rule 7.1A.'
To transact any other business that may be brought forward in accordance with the Company's Constitution.
By order of the Board
Marcelo Mora
Company Secretary
21 October 2016
Equus Mining Limited ABN 44 065 212 679
Level 2, 66 Hunter Street
Sydney NSW 2000
Australia
T +61 2 9300 3366
F +61 2 9221 6333
E info@equusmining.com
W www.equusmining.com
Explanatory Memorandum
to the Notice of Annual General Meeting
This Explanatory Memorandum has been prepared to assist members to understand the business to be put
to members at the Annual General Meeting to be held at Level 5, 56 Pitt Street, Sydney, NSW, on Tuesday,
22 November 2016 at 11 am Eastern Daylight Saving Time (EDST).
Financial Report
The Financial Report, Directors' Report and Auditor's Report for the Company for the year ended 30 June
2016 will be laid before the meeting. There is no requirement for shareholders to approve these reports,
however, the Chair of the meeting will allow a reasonable opportunity to ask the auditor questions about
the conduct of the audit and the content of the Auditor's Report.
Resolution 1 Adoption of Remuneration Report
The Remuneration Report, which forms part of the Directors’ Report in the Company’s 2016 Annual
Report, contains certain prescribed details, sets out the policy adopted by the Board of Directors and
discloses the payments to Directors.
In accordance with section 250R of the Corporations Act, a resolution that the Remuneration Report be
adopted must be put to the vote. The resolution is advisory only and does not bind the Directors or the
Company.
Shareholders will be given a reasonable opportunity at the meeting to comment on and ask questions
about the Company’s Remuneration Report.
The Chair intends to exercise all undirected proxies in favour of Resolution 1. If the Chair of the Meeting is
appointed as your proxy and you have not specified the way the Chair is to vote on Resolution 1, by signing
and returning the Proxy Form, you are considered to have provided the Chair with an express authorisation
for the Chair to vote the proxy in accordance with the Chair's intention.
Voting Exclusion Statement
A vote on the resolution must not be cast (in any capacity) by or on behalf of any of the following persons:
a member of the key management personnel details of whose remuneration are included in the
remuneration report;
a close related party of such a member.
However such a person may cast a vote on the resolution if:
the person does so as a proxy appointed by writing that specifies how the proxy is to vote on the
proposed resolution; and
the vote is not cast on behalf of such a person.
The Directors recommend that you vote IN FAVOUR of this advisory Resolution 1.
The Chair of the Meeting intends to vote undirected proxies IN FAVOUR of Resolution 1.
2
Resolution 2
Re-election of Juerg Walker
In accordance with Article 3.6 of the Company’s Constitution and the Corporations Act, Juerg Walker who
retires by rotation and, being eligible, offers himself for re-election.
Juerg Walker is a European portfolio manager and investor. He has over 30 years’ experience in the Swiss
banking industry, operating his own portfolio management company after leaving his position as senior
vice president of a private bank in Zurich.
The Directors recommend that you vote IN FAVOUR of Resolution 2.
The Chair of the Meeting intends to vote undirected proxies IN FAVOUR of Resolution 2.
Resolution 3 Approval of additional capacity to issue securities
ASX Listing Rule 7.1A enables the Company to issue equity securities up to 10% of its issued share capital
through placements over a 12 month period after the AGM ('10% Placement Facility'). The 10% Placement
Facility is in addition to the Company's 15% placement capacity under ASX Listing Rule 7.1.
Resolution 3, which is a Special Resolution requiring 75% of votes cast to be in favour of the resolution,
seeks shareholder approval for the Company to have the ability to issue equity securities under the 10%
Placement Facility on the following terms:
(a) Placement Period
Shareholder approval of the 10% Placement Facility is valid from the date of the AGM and expires on the
earlier of:
(i) the date that is 12 months after the date of the AGM; or
(ii) the date of the approval by shareholders of a transaction under ASX Listing Rules 11.1.2 (a
significant change to the nature or scale of activities) or 11.2 (disposal of main undertaking).
(b) Equity Securities
Any equity securities issued under the 10% Placement Facility must be in the same class as an existing
quoted class of equity securities of the Company which, in the Company's case, are fully paid ordinary
shares.
(c) Formula for calculating 10% Placement Facility
The maximum number of shares that can be issued under the 10% Placement Facility is calculated as
follows:
(A x D) - E
Where: A is the number of fully paid ordinary shares on issue 12 months before the date of issue or
agreement:
(i)
(ii)
(iii)
plus the number of fully paid ordinary shares issued in the 12 months under an exception in
ASX Listing Rule 7.2;
plus the number of partly paid ordinary shares that became fully paid in the 12 months;
plus the number of fully paid shares issued in the 12 months with approval of holders of
shares under Listing Rule 7.1 and 7.4;
(iv)
less the number of fully paid shares cancelled in the 12 months.
D is 10%.
E is the number of fully paid ordinary shares issued or agreed to be issued under ASX Listing Rule
7.1A.2 in the 12 months before the date of the issue or agreement to issue that are not issued with
the approval of shareholders under ASX Listing Rules 7.1 or 7.4.
3
The current maximum number of shares, as at the date of this meeting, that can be issued under the 10%
Placement Facility is 43,487,309. The Company’s current capacity to issue securities as at the date of the
meeting pursuant to listing rule 7.1 is 65,230,964.
(d) Minimum Issue Price
The minimum issue price of equity securities issued for the purpose of Listing Rule 7.1.A.3 must be not less
than 75% of the volume weighted average price of equity securities in the same class calculated over the
15 trading days on which trades were recorded immediately before:
(i)
the date on which the price at which the equity securities are to be issued is agreed; or
(ii)
if the equity securities are not issued within 5 trading days of the date in paragraph (i) above,
the date on which the equity securities are issued.
(e) Risk of Economic and Voting Dilution
If Resolution 3 is approved by shareholders and the Company issues equity securities under the 10%
Placement Facility, the existing shareholders' voting power in the Company will be diluted as shown in the
table below. Further, there is a risk that:
(i)
the market price for the Company's equity securities may be significantly lower on the date of
the issue of the equity securities than on the date of the AGM; and
(ii) the equity securities may be issued at a price that is at a discount to the market price for the
Company's equity securities on the issue date.
Because Variable A in the formula for calculating 10% Placement Facility, and consequently the number of
shares that can be issued under the 10% Placement Facility, can change during the Placement Period, the
table below shows a matrix of scenarios of the potential dilution of existing shareholders as at the date of
the AGM on the basis of:
(i)
the issue price of equity securities being the current approximate market price of fully paid
ordinary shares, plus 50% and minus 50%; and
(ii) the maximum number of shares that can be issued under the 10% Placement Facility in
accordance with the definition of Variable A in the formula for calculating 10% Placement
Facility increasing by 50% and 100%.
Variable A in
10% Placement Facility
under ASX Listing Rule
7.1A.2
Voting Dilution
and Placement
Facility Capacity
Current Variable A
434,873,094 shares
50% increase in current
Variable A
652,309,641 shares
100% increase in
current Variable A
869,746,188 shares
10%
43,487,309
Shares
13.0%
65,230,964
Shares
16.7%
86,974,619
shares
50% Decrease in
Current
Approximate
Market Price
$0.006
Issue Price and
Funds Raised
Current
Approximate
Market Price
$0.012
50% Increase in
Current
Approximate
Market Price
$0.018
$260,924
$521,848
$782,772
$391,386
$782,772
$1,174,157
$521,848
$1,043,695
$1,565,543
4
As an example, if Variable A is increased to 869,746,188 shares, the 10% Placement Facility capacity is
86,974,619 shares and therefore the dilution of existing shares as at the date of the AGM, being
434,873,094 shares, is calculated as:
86,974,619 ÷ (434,873,094 + 86,974,619) = 16.7%
(f) Other Matters
The Company may issue equity securities under the 10% Placement Facility for cash consideration to
support the Company's ongoing exploration activities and working capital or non-cash consideration for
the acquisition of compatible business opportunities which may arise. In such circumstances the Company
will provide a valuation of the non-cash consideration as required by ASX Listing Rule 7.1A.
The Company’s allocation policy is dependent on the prevailing market conditions at the time of any
proposed issue pursuant to the 10% Placement Facility. As there is no issue currently proposed, the
identity of the allottees is not currently known and will be determined on a case-by-case basis at the time
of allotment, having regard to factors including, but not limited to, the following:
(i) the methods of raising funds that are available to the Company, including but not limited to,
rights issues or other issues in which existing security holders can participate;
(ii) the effect of the issue of the equity securities on the control of the Company;
(iii) the financial situation and solvency of the Company; and
(iv) advice from corporate, financial and broking advisers (if applicable).
The allottees under the 10% Placement Facility have not currently been determined but may include
existing substantial shareholders and/or new shareholders who are not related parties or associates of a
related party of the Company.
The Company obtained shareholder approval under ASX Listing Rule 7.1A at its 2015 Annual General
Meeting. However, no equity securities were issued under Listing Rule 7.1A, 10% Placement Facility during
the preceding 12 months.
The Company issued a total of 3,363,636 ordinary fully paid shares in the 12 months preceding the date of
the meeting which based on the number of equity securities on issue at the commencement of that period
represents 0.78% of the Company’s equity securities.
Information relating to the issue of equity securities in the preceding 12 months is as follows:
Date of the issue:
The number of securities issued:
Class of securities issued:
Name of the allottees:
The issue price of the securities
and the closing price on the previous
trading day:
The issue was for cash:
16 December 2015.
3,363,636.
Ordinary fully paid shares.
Mark Hamish Lochtenberg & Michal Lichtenberg 2,272,727 ordinary shares; and
R&D Yeates Holdings Pty Ltd 1,090,909
ordinary shares.
The issue price was $0.011 per share and the closing price
on the previous trading day was $0.010.
The total cash consideration was $37,000 and was used in
exploration activities at the company’s Mina Rica project in
Chile and working capital.
5
Voting Exclusion:
The Company will disregard any votes cast on Resolution 3 by:
a person who may participate in the proposed issue; and
a person who might obtain a benefit, except a benefit solely in the capacity of a holder of ordinary
securities, if the resolution is passed and any such associates of that person.
However, the Company need not disregard a vote if:
it is cast by a person as proxy for a person who is entitled to vote, in accordance with the
directions on the proxy form; or
it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in
accordance with a direction on the proxy form to vote as the proxy decides.
The Directors recommend that you vote IN FAVOUR of Resolution 3.
The Chair of the Meeting intends to vote undirected proxies IN FAVOUR of Resolution 3.
6
FORM OF PROXY
I/we . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
of . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
being a member/members of Equus Mining Limited HEREBY APPOINT
the Chair of the Meeting (mark box)
OR if you are not appointing the Chair of the Meeting as your proxy, please write the name of the person or body corporate
(excluding the registered shareholder) you are appointing as your proxy below
or failing the individual or body corporate named, or if no individual or body corporate is named, the Chair of the meeting, as
my/our proxy to act generally at the Meeting on my/our behalf and to vote in accordance with the following directions (or if
no directions have been given, and to the extent permitted by law, as the proxy sees fit) at the Annual General Meeting of
Equus Mining Limited to be held at Level 5, 56 Pitt Street, Sydney, NSW, 2000 on Tuesday 22 May 2016 at 11.00 am (AEST)
and at any adjournment or postponement of that Meeting.
The Chair of the Meeting is authorised to exercise undirected proxies on remuneration related matter (Resolution 1): If
I/we have appointed the Chair of the Meeting as my/our proxy or the Chair of the Meeting becomes my/our proxy by
default, by signing and submitting this form I/we expressly authorise the Chair of the Meeting to exercise my/our proxy in
respect of Resolution 1 (except where I/we have indicated a different voting intention above) even though Resolution 1 is
connected directly or indirectly with the remuneration of a member of key management personnel for Equus Mining Limited,
which includes the Chair.
The Chair of the Meeting intends to vote all undirected proxies in favour of each resolution (including Resolution 1). If you
have appointed the Chair of the Meeting as your proxy (or the Chair of the Meeting becomes your proxy by default), and you
wish to give the Chair specific voting directions on an item, you should mark the appropriate box/es opposite those
resolutions below (directing the Chair to vote for, against or to abstain from voting).
If you mark the Abstain box for a particular item, you are directing your proxy not to vote on your behalf on a show of hands
or on a poll and your vote will not be counted in calculating the required majority if a poll is called.
RESOLUTIONS
1. Adoption of the Remuneration Report
2. Re-election of Mr Juerg Walker
3. Approval additional capacity to issue equity securities
FOR
AGAINST
ABSTAIN
Signature of Securityholder(s) This section must be completed.
Signatures of Securityholder(s)
Dated this . . . . . . day of . . . . . . . . . . . . . . . . . . . . . . 2016
Individual or Securityholder 1
Securityholder 2
Securityholder 3
Sole Director and
Sole Company Secretary
Director
Director
PROXY INSTRUCTIONS
1. Appointment of a Proxy
If you wish to appoint the Chair of the Meeting as your proxy, mark the box. If the individual or body corporate you
wish to appoint as your proxy is someone other than the Chair of the Meeting please write the full name of that
individual or body corporate in the space provided. If you leave this section blank, or your named proxy does not
attend the meeting, the Chair of the Meeting will be your proxy. A proxy need not be a securityholder of the
company.
2. Appointment of a Second Proxy
A member entitled to attend and vote and is entitled to appoint not more than 2 proxies to attend the meeting and
vote on a poll.
Where more than 1 proxy is appointed, each proxy must be appointment to represent a specified proportion of the
member's voting rights. If you appoint 2 proxies and the appointment does not specify the proportion or number of
your votes the proxy may exercise, each proxy may exercise half of the votes.
A proxy need not be a member.
This Proxy form (and the original or certified copy of any power of attorney under which this proxy form is signed)
must be received at an address given below no later than 48 hours before the time appointed for holding the
meeting:
3. Voting
The vote on the resolutions will be decided on a show of hands unless a poll is demanded. On a show of hands,
every shareholder who is present in person or by proxy, or by representative or by attorney, will have one vote.
Upon a poll, every shareholder who is present in person or by proxy, or by representative or by attorney, will have
one vote for each Share held by that shareholder.
4.
Signing Instructions
All joint holders must sign.
Where the company has a Sole Director and Company Secretary, that person must sign. Otherwise this form must
be signed by a Director jointly with either another Director or a Company Secretary.
All executors of deceased estates must sign.
5. Persons entitle to attend and vote
The Company has determined, in accordance with regulation 7.11.37 of the Corporations Regulations 2001 (Cth),
that the Company's shares quoted on the ASX Limited at 7.00 pm Sydney time on 20 November 2016 are taken, for
the purposes of the Annual General Meeting to be held by the persons who held them at that time. Accordingly,
those persons are entitled to attend and vote (if not excluded) at the meeting.
6. Corporate Representatives
If a representative of the corporation is to attend the meeting. The representative must bring to the Annual
General Meeting evidence of his or her appointment, including any authority under which it was signed in
accordance with section 253B of the Corporations Act 2001.
in person or by mail at the Company's registered office, Level 2, 66 Hunter Street, Sydney, NSW 2000 Australia;
or
by facsimile on +61 2 9221 6333.