ANNUAL REPORT
2022
ABN 68 125 323 622
2022
Registered and Principal Office
Office 10, Emerald House, 1202 Hay St
West Perth WA 6005
Telephone: +61 8 9226 2011
Email:
Web:
info@fenixresources.com.au
www.fenixresources.com.au
Auditor
Grant Thornton Audit Pty Ltd
Central Park
Level 43, 152-158 St Georges Terrace
Perth WA 6000
Share Registry
Automic Registry Services
Level 2, 267 St Georges Terrace
Perth WA 6000
Telephone: 1300 288 664
Facsimile:
+61 2 9698 5414
CORPORATE DIRECTORY
Directors
Robert Brierley
John Welborn
Garry Plowright
Warwick Davies
Managing Director
Non-Executive Chairman,
appointed 16 November 2021
Non-Executive Director
Non-Executive Chairman,
resigned 16 November 2021
Richard Nicholls-Maltman Non-Executive Director
resigned 15 November 2021
Company Secretary
Shannon Coates
Stock Exchange Listing
Australian Securities Exchange
ASX Code - FEX
Bankers
National Australia Bank Limited
50 St Georges Terrace
Perth WA 6000
CONTENTS
Corporate Directory
Directors’ Report
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 and forming part of the Consolidated Financial Statements
Directors’ Declaration
Independent Auditor’s Report
Additional Information
2
3
23
24
25
26
27
28
69
70
73
FENIX RESOURCES LIMITED
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DIRECTORS’ REPORT
The Directors present their financial report for the consolidated entity consisting of Fenix Resources Limited (Company
or Fenix) and the entities it controls (Consolidated Entity or Group) at the end of, or during, the year ended 30 June
2022.
REVIEW OF OPERATIONS
During the year ended 30 June 2022, Fenix Resources Limited (Fenix or the Company) continued to build on its proven
track record of strong operational performance at the Iron Ridge iron ore project (Iron Ridge Project or the Project) in
Western Australia’s Mid-West, which resulted in shipment of more than 1.33 million wet metric tonnes (wmt) of high-
quality iron ore during the year.
Health and Safety
The Company is committed to maintaining a safe work environment for all personnel. During the year ended 30 June
2022, the Company recorded one (1) Lost Time Injury (LTI), relating to a muscular impact injury that occurred at the Iron
Ridge Project. The Company’s Geraldton Port operations remain LTI-free since inception.
During the year, Fenix continued to manage strict COVID-19 protocols at all operational sites to protect the health, safety
and wellbeing of the Company’s people. The Company was not materially affected by COVID-19 related restrictions, with
minor numbers of cases being managed according to our policies and procedures, and in line with current health
regulations.
Despite the relaxation of Government requirements, Fenix maintained mandatory vaccination requirements at all sites
as at 30 June 2022. Fenix personnel have responded positively to changing circumstances throughout the pandemic.
Mining and Production
Production Summary
Production Summary (kwmt)
June Q FY22
March Q FY22
Dec Q FY22
Sep Q FY22
Total FY22
Ore Mined
Lump Ore Produced
Fine Ore Produced
Lump Ore Hauled
Fine Ore Hauled
Lump Ore Shipped
Fine Ore Shipped
C1 Cash Cost
(A$/wmt Shipped FOB)
313.6
122.7
196.5
132.7
207.4
140.7
203.6
91.5
340.6
143.2
196.9
121.4
207.3
100.3
194.4
81.7
277.9
122.7
153.3
165.4
166.4
188.4
168.3
94.1
335.2
204.5
173.7
195.6
149.4
197.8
143.4
86.8
1267.3
593.1
720.4
615.1
730.5
627.2
709.7
88.8
Performance at a Glance
Item
Lump Product Sales
Fines Product Sales
Total Ore Sales
Platts 62% Fe CFR Price,
Average
Average Realised FOB Price
Average Freight Cost
Unit
k wmt
k wmt
k wmt
US$/dmt
US$/dmt
US$/dmt
FENIX RESOURCES LIMITED
June Q FY22 Mar Q FY22
Dec Q FY22
Sep Q FY22
Total FY22
141
203
344
137.9
121.9
32.2
100
194
295
141.6
132.8
26.7
188
168
357
109.6
56.0
33.5
198
143
341
162.9
129.2
34.4
627
708
1337
138.0
108.6
31.9
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DIRECTORS’ REPORT (continued)
During the year ended 30 June 2022, Fenix loaded a total of twenty-three (23) ships with a total of 1.33 million wmt of
iron ore from the Iron Ridge Project (0.63 million wmt of lump and 0.71 million wmt of fines).
As at 30 June 2022, Fenix had shipped a total of approximately 1.84 million wmt (1.75 million dry metric tonnes (dmt) of
product from its Iron Ridge Project from inception.
Average grade shipped for the year was 61.9% Fe for fines (FY21: 61.2%) and 64.3% Fe for lump product (FY21: 63.9%),
further displaying the unique high-grade, high-quality nature of the Iron Ridge ore body.
The project-to-date lump to fines ratio of 47%:53% continues to be significantly higher than the life-of-mine assumed
average of 25%:75%.
Financial Performance
Net operating cash flow for the year ended 30 June 2022 was A$62.3m (FY21: A$65.3m).
The Company paid A$10.7m in corporate tax payments during the year, reducing the net operating cashflow. Tax
payments moved to quarterly instalments from the start of FY23.
Capital expenditure for the year ended 30 June 2022 was A$6.8m mainly relating to mine site infrastructure. Total project
capital expenditure to date is approximately A$23m.
C1 FOB Cash Costs for the year were A$88.83 per wmt shipped, compared to A$88.77 the previous year, Cash Costs were
stable despite higher fuel and contract costs resulting from macroeconomic events which were offset by the absence of
the one-off ramp up costs which were incurred in FY21. Following completion of the Fenix Newhaul Transaction, the
Company expects C1 FOB cash costs to reduce by approximately A$10 per tonne recognising full ownership by the
Company of the haulage profit margin.
Project costs to date are approximately A$89/wmt FOB, equivalent to around US$62/wmt based on prevailing FX rates.
These costs are inclusive of marketing fees and costs incurred in the ramp up period in late 2020 and the early months
of 2021.
Sea freight costs increased during the year, predominantly due to higher oil prices impacting bunker prices. Marketing
fees and royalties remained higher than feasibility study assumptions, due to the achievement of higher realised FOB
prices.
As at 30 June 2022, Fenix had A$101.9m cash and no senior bank debt. The Company’s cash balance as at 30 June 2022
represented net cash backing of approximately $0.20 per share.
Fenix-Newhaul Haulage Joint Venture
Fenix Newhaul Pty Ltd (Fenix-Newhaul) was a 50:50 joint venture transport company established by Fenix and Newhaul
Pty Ltd (Newhaul) in October 2020 (see ASX Announcement dated 26 October 2020). Fenix-Newhaul provides bulk
haulage transport of the Company’s high-grade iron ore products from the Iron Ridge Project to the Company’s loading
facilities at Geraldton Port.
On 21 June 2022, Fenix announced that the Company had signed definitive agreements with Newhaul to acquire
Newhaul’s 50% interest in Fenix-Newhaul, which will result in the consolidation of 100% ownership of the haulage
business into Fenix (Transaction). Subsequent to the end of the financial year, on 22 July 2022, Fenix announced the
Transaction had been completed.
Completion of the Transaction is expected to deliver lower operating costs for Fenix with additional value expected from
operational flexibility advantages as well as unlocking new growth opportunities that can now be explored for the benefit
of Fenix.
During the year ended 30 June 2022, approximately 1.33 million tonnes of iron ore were hauled by Fenix Newhaul,
slightly higher than budgeted levels of approximately 110,000 tonnes per month.
FENIX RESOURCES LIMITED
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DIRECTORS’ REPORT (continued)
During the year, Fenix Newhaul converted the majority of the haulage fleet to a quad-trailer configuration after a
successful trial period conducted in late 2021. The innovative quad-trailer combination has increased haulage capacity
to approximately 140 tonnes per truck delivering cost savings on a per tonne basis. As at 30 June 2022, Fenix-Newhaul
operates twenty six (26) truck and trailer combinations, eighteen (18) of which are quad-trailer combinations. Delivery
of the remaining seven (7) A-Trailers is expected to occur during the first quarter of FY23.
Exploration
In February 2021, Fenix executed a farm-in and joint venture agreement with Scorpion Minerals Limited (Scorpion) over
33,954 hectares of tenements held by Scorpion adjoining the Company’s Iron Ridge operations (see ASX Announcement
dated 8 February 2021).
On 9 February 2022, Fenix executed a Deed of Amendment agreement with Scorpion in relation to tenements E20/953
and E20/948 (together the Pharos Project Tenements) (See ASX announcement dated 9 February 2022). The new
agreement accelerated the previous farm-in and joint venture agreement such that Fenix has earned a 100% interest in
the Iron Ore rights on the Pharos Project Tenements.
Field work on the Scorpion farm-in tenements commenced during the year with an extensive Heritage Survey conducted
over areas prospective for iron ore mineralisation. Several target areas have been identified within close proximity to
the Company’s existing operations which justify exploration for potential high grade iron mineralisation similar to Iron
Ridge.
All required clearances have been received over the Scorpion farm-in tenements and the Company is reviewing data and
conducting ground truthing to support finalisation of a potential first-pass drilling program over the high priority target
areas at the Pharos Project Tenements.
In addition to exploration work undertaken on the Pharos Project Tenements, the Company continued to review regional
exploration targets at the Iron Ridge Project during the year with several areas of interest identified for follow-up drilling.
A small RC drilling program at Iron Ridge was conducted during the year which validated the current Mineral Resource
model.
CORPORATE
Dividend Policy
On 23 August 2021, Fenix announced the adoption of a dividend policy to distribute between 50% and 80% of after-tax
profits as fully franked dividends, subject to the availability of franking credits.
In September 2021, the Company declared a maiden fully franked final dividend of 5.25c per share after announcing a
$49.0m after-tax profit for FY21. The dividend was paid on 5 October 2021 resulting in a cash outflow of $24.1m.
Fenix has declared a final dividend of 5.25 cents per share for the financial year ended 30 June 2022 (30 June 2021: 5.25c)
equating to a total dividend payment of approximately $28.7 million (30 June 2021: A$24.8m). The record date is
2 September 2022 and the payment date is 5 October 2022.
Board Changes
On 16 November 2021, Mr John Welborn was appointed as an independent Non-Executive Director and Chairman of
Fenix Resources. Mr Welborn’s appointment followed the resignations of Mr Warwick Davies as Interim Non-Executive
Chairman and Mr Richard Nicholls-Maltman as a Non-Executive Director.
Mr Welborn is a highly accomplished and internationally respected mining company director and senior executive with
a successful track record of leading strategic growth strategies and generating exceptional returns for shareholders. A
Fellow of the Institute of Chartered Accountants in Australia, a Fellow of the Australian Institute of Management, and a
member of the Australian Institute of Mining and Metallurgy, Mr Welborn is a former investment banker who has
operated in the resources sector for more than twenty years.
FENIX RESOURCES LIMITED
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DIRECTORS’ REPORT (continued)
Mr Welborn was Managing Director and CEO of Resolute Mining Limited over a five-year period which saw the
company’s market capitalisation grow from less than $200 million to more than $1 billion corresponding with the
Company joining the ASX200 and an increase in the share price during his tenure as CEO of more than 300%. Under Mr
Welborn’s leadership, Resolute was transformed through the development, acquisition, and operation of new mining
operations which resulted in production of more than 1.7 million ounces of gold. Additional achievements included the
successful execution of value creative corporate transactions, comprehensive refinancing and investment activities, and
the admission of the company’s shares for trading on the main board of the London Stock Exchange.
In addition to his experience at Resolute, Mr Welborn has previous iron ore experience as a Director of Equatorial
Resources Limited. Mr Welborn is Director of Apollo Minerals Limited and Orbital Corporation Limited and is a former
Director of the World Gold Council, the Australia-Africa Minerals and Energy Group, and a former Commissioner of
Tourism Western Australia. Mr Welborn is a champion for responsible and sustainable mining development and was
named by MiningMx as one of the 100 Most Influential People in Africa’s Mining Industry.
Mr Welborn was also appointed as the Fenix representative on the Fenix-Newhaul Board, effective 29 November 2021.
Hedging
On 22 July 2021, Fenix entered into swap arrangements with an Australian top tier financial institution for 50,000 dmt
of iron ore per month based on the Monthly Average Platts TSI 62 Index converted to AUD for the 12-month period from
October 2021 to September 2022. The price fixed is equivalent to A$230.30/dmt, flat over the period.
On 9 June 2022, the Company entered into additional iron ore swap arrangements for 35,000 dmt per month of the
Monthly Average Platts TSI 62 Index converted to AUD for the 9-month period from October 2022 to June 2023. The
price fixed is equivalent to A$180.65 per dmt, flat over the period.
The swap arrangements were executed as part of the Company’s Price Protection Policy designed to secure the medium-
term future of the Iron Ridge project, whilst maintaining Fenix’s exposure to the iron ore price.
As at 30 June 2022, Fenix’s hedge book had a mark-to-market value of approximately A$12.65m, inclusive of the
outstanding settlement for the month of June 2022 that was paid subsequent to the end of the year. The sale of iron
ore under such hedge instruments is accounted for using the ‘own use exemption’ under AASB 9 Financial Instruments
and as such all hedge revenue is recognised in the Statement of Profit or Loss and no fair value adjustments are
subsequently made to sales yet to be delivered under the hedging program.
Capital
During the year ended 30 June 2022, the Company issued a total of 46.0 million fully paid ordinary shares in the capital
of the Company as follows:
•
•
•
•
2.0 million fully paid ordinary shares issued upon exercise of 2.0 million unlisted options exercisable at $0.08 per
option;
30.0 million fully paid ordinary shares issued upon conversion of Class B Performance Shares following the shipment
and sale of one million dmt of iron ore from the Iron Ridge Project (refer ASX announcement dated 1 December
2021).
10.0 million fully paid ordinary shares issued at a price of $0.23 per share pursuant to the Share Loan Plan approved
by Shareholders on 4 March 2022; and
4.0 million fully paid ordinary shares issued to Scorpion as consideration for the acquisition of 100% interest in the
Iron Ore rights on the Pharos Project Tenements.
Pursuant to the terms of the Transaction, a total of up to 90.0 million fully paid ordinary shares in the capital of the
Company may be issued subsequent the year end (See ASX announcement dated 21 June 2022 for full details).
Tenements
As at the date of this report, the Company’s interests in tenements are set out below:
FENIX RESOURCES LIMITED
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DIRECTORS’ REPORT (continued)
Location
Project
Western Australia
Iron Ridge
Western Australia
Iron Ridge
Western Australia
Iron Ridge
Western Australia
Iron Ridge
Western Australia
Iron Ridge
Western Australia
Iron Ridge
Western Australia
Pharos
Western Australia
Pharos
Tenement
M20/118-I
E20/936
L20/83
L20/84
L20/85
G20/28
E20/943
E20/953
Interest
100%
100%
100%
100%
100%
100%
100% of Iron Ore rights
100% of Iron Ore rights
Annual Mineral Resource and Ore Reserves Statement
The Company carries out an annual review of its iron ore Mineral Resources and Ore Reserves at the Iron Ridge Project
in Western Australia as required by the ASX Listing Rules. The review was carried out as at 30 June 2022. The estimates
for Mineral Resources and Ore Reserves were prepared and disclosed under the JORC Code 2012 Edition. The original
Mineral Resource was disclosed to ASX on 21 August 2019 and Ore Reserves on 4 November 2020 and were subsequently
updated to 30 June 2021 (as announced to ASX in the Company’s Annual Report on 15 September 2021).
Estimation Governance Statement
The Company ensures that all Mineral Resource and Ore Reserves estimations are subject to appropriate levels of
governance and internal controls.
Exploration results are collected and managed by an independent competent qualified geologist. All data collection
activities are conducted to industry standards based on a framework of quality assurance and quality control protocols
covering all aspects of sample collection, topographical and geophysical surveys, drilling, sample preparation, physical
and chemical analysis and data and sample management.
Mineral Resource and Ore Reserves estimates are prepared by appropriately qualified, independent Competent Persons.
If there is a material change in the estimate of a Mineral Resource or Ore Reserves, the estimate and supporting
documentation in question is reviewed by a suitable qualified independent Competent Persons and announced to the
ASX in accordance with the Listing Rules.
The Company reports its Mineral Resources and Ore Reserves on an annual basis in accordance with JORC Code 2012.
Iron Ridge Mineral Resource as at 30 June 2022 – 58% Fe cut-off applied.
JORC Classification
Inferred
Indicated
Total
Mt
0.3
8.0
8.3
Fe (%)
AL2O3 (%)
LOI (%)
P (%)
SiO2 (%)
TiO2 (%)
61.6
65.0
64.8
2.77
2.23
2.25
4.24
1.69
1.78
0.05
0.04
0.04
4.66
2.88
2.95
0.10
0.09
0.09
Iron Ridge Mineral Resource as at 30 June 2021 – 58% Fe cut-off applied.
JORC Classification
Inferred
Indicated
Total
Mt
0.4
9.4
9.8
Fe (%)
AL2O3 (%)
LOI (%)
P (%)
SiO2 (%)
TiO2 (%)
62.1
64.5
64.4
2.74
2.45
2.46
3.70
1.85
1.92
0.05
0.05
0.05
4.52
3.11
3.16
0.11
0.09
0.09
Mineral Resources totalled 8.3 Mt at 64.8% Fe as at 30 June 2022, inclusive of Ore Reserves. This represents a 15%
decrease in Mineral Resources when compared to the remaining total Mineral Resources as at 30 June 2021. Depletion
in the Mineral Resource occurred due to iron ore production, which commenced in December 2020.
FENIX RESOURCES LIMITED
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DIRECTORS’ REPORT (continued)
Iron Ridge Ore Reserves as at 30 June 2022 – 58% Fe cut-off applied.
JORC Classification
Mt
Fe (%)
AL2O3 (%)
LOI (%)
P (%)
SiO2 (%)
TiO2 (%)
Probable
Total
5.64
5.64
64.6
64.6
2.40
2.40
1.76
1.76
0.04
0.04
3.09
3.09
0.09
0.09
Iron Ridge Ore Reserves as at 30 June 2021 – 58% Fe cut-off applied.
JORC Classification
Mt
Fe (%)
AL2O3 (%)
LOI (%)
P (%)
SiO2 (%)
TiO2 (%)
Probable
Total
7.10
7.10
64.09
64.09
2.67
2.67
1.96
1.96
0.05
0.05
3.35
3.35
0.09
0.09
Ore Reserves totalled 5.64 Mt at 64.6% Fe as at 30 June 2022. This represents an 21% decrease in Ore Reserves when
compared to the Ore Reserves as at 30 June 2021. Depletion in the Ore Reserve occurred due to iron ore production,
which commenced in December 2020.
Note: Tonnage figures in the above tables have been rounded and as a result may not add up to the totals quoted.
Competent Person’s Statement
The information in this report that relates to Mineral Resources is based on information compiled by Mr Alex Whishaw, a Competent
Person who is a Member of the Australasian Institute of Mining and Metallurgy and is a former employee of CSA Global Pty Ltd. Mr
Whishaw has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity
which they are undertaking to qualify as a Competent Person as defined in the 2012 edition of the Australasian Code for the Reporting
of Exploration Results, Mineral Resources, and Ore Reserves (JORC Code). The Company confirms it is not aware of any new
information or data that materially affects the information included in the relevant market announcement and all material
assumptions and technical parameters underpinning the estimates in the relevant market announcements continue to apply and have
not materially changed.
The information in this report that relates to the Processing and Metallurgy for the Iron Ridge Project is based on and fairly represents,
information and supporting documentation compiled by Mr Damian Connelly who is a Fellow of the Australasian Institute of Mining
and Metallurgy and a full-time employee of METS Engineering Group. Mr Connelly has sufficient experience relevant to the style of
mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person
as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’.
The Company confirms it is not aware of any new information or data that materially affects the information included in the relevant
market announcement and all material assumptions and technical parameters underpinning the estimates in the relevant market
announcements continue to apply and have not materially changed.
The information in this report that relates to Ore Reserves is based on information compiled by Mr John Battista, a Competent Person
who is a Member and Chartered Professional (Mining) of the Australasian Institute of Mining and Metallurgy and is a former employee
of Mining Plus (UK) Ltd. Mr Battista has sufficient experience relevant to the style of mineralisation and type of deposit under
consideration and to the activity which they are undertaking to qualify as a Competent Person as defined in the 2012 edition of the
Australasian Code for the Reporting of Exploration Results, Mineral Resources, and Ore Reserves (JORC Code). The Company confirms
it is not aware of any new information or data that materially affects the information included In the relevant market announcement
and all material assumptions and technical parameters underpinning the estimates in the relevant market announcements continue
to apply and have not materially changed. In relation to the production target and forecast financial information referred to in the
report, the Company confirms that all material assumptions underpinning the production target and the forecast financial information
derived from the production target continue to apply and have not materially changed since the announcement of the feasibility study
on 4 November 2019.
This Annual Mineral Resource and Ore Reserves Statement is based on and fairly represents the information and supporting
documentation prepared by the above-mentioned Competent Persons. It is approved as a whole by Mr Steve O’Grady, a Competent
Person who is a Member of Australasian Institute of Mining and Metallurgy and is currently employed by Intermine Engineering
Consultants. Mr O’Grady has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and
to the activity which he is undertaking to qualify as a Competent Person as defined in the 2012 edition of the Australasian Code for
the Reporting of Exploration Results, Mineral Resources, and Ore Reserves (JORC Code).
FENIX RESOURCES LIMITED
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DIRECTORS’ REPORT (continued)
DIRECTORS
The names of Directors who held office during the year and up to the date of signing this report, unless otherwise stated
are:
John Welborn
Robert Brierley
Garry Plowright
Non-Executive Chairman (appointed 16 November 2021)
Managing Director (appointed 1 March 2019), Non-Executive Director (appointed 1
June 2018), Executive Director (appointed 21 November 2018)
Non-Executive Director (Appointed 21 November 2018 as Executive Director, and
transitioned to Non-Executive Director 1 January 2021)
Richard Nicholls-Maltman Non-Executive Director (appointed 17 May 2021, resigned 15 November 2021)
Warwick Davies
resigned
Interim Non-Executive Chairman
16 November 2021), Non-Executive Director (appointed 9 November 2020, resigned
16 November 2021)
(appointed 19 February 2021,
PRINCIPAL ACTIVITIES
The principal activity of the Group was to explore, develop and mine mineral tenements in Western Australia.
DIVIDENDS
A final dividend of 5.25 cents per share has been declared for the financial year ended 30 June 2022 (30 June 2021: 5.25c)
equating to a total dividend payment of approximately [A$28.7 million] (30 June 2021: A$24.8m]. The record date is 2
September 2022 and the payment date is 5 October 2022. Details of the Group's dividend policy are set out in Note 21.
FINANCIAL SUMMARY
The Group made a net profit after tax of $50,694,454 for the financial year ended 30 June 2022 (30 June 2021: profit
$49,040,926). At 30 June 2022, the Group had net assets of $108,221,265 (30 June 2021: $77,262,229) and cash assets
of $101,675,767 (30 June 2021: $68,995,789).
SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS
The significant changes in the state of affairs of the Consolidated Entity during the financial period and to the date of
this report are set out in the review of operations above.
MATTERS SUBSEQUENT TO THE END OF THE REPORTING PERIOD
Subsequent to the end of the reporting period:
- on 22 July 2022 , Fenix completed the acquisition of the remaining 50% interest in haulage joint venture company,
Fenix-Newhaul Pty Ltd (Fenix-Newhaul) resulting in the consolidation of 100% ownership of the haulage business.
In accordance with the Share Sale Agreement the Company has paid Newhaul $7.5 million in cash and 30,000,000
Fenix fully paid ordinary shares. In addition, Mr Craig Mitchell, has been nominated to join the Board of Fenix, with
his appointment as a director to be effective on and from 1 September 2022; and
- on 25 July 2022, Mr Rob Brierley tendered his resignation from the position of Managing Director. The Board of
Fenix have accepted Mr Brierley’s resignation on the basis he will continue in his current role for a period of up to
three months to assist the Company in an orderly leadership transition.
No other material matters have occurred subsequent to the end of the year which requires reporting on other than
those which have been noted above or reported to ASX.
FENIX RESOURCES LIMITED
- 9 -
DIRECTORS’ REPORT (continued)
Other than as set out above, there has not arisen in the interval between the end of the period and the date of this
report any item, transaction or event of a material and unusual nature likely, in the opinion of the Directors of the
Company to affect substantially the operations of the Company, the results of those operations or the state of affairs of
the Company in subsequent financial years.
INFORMATION ON DIRECTORS
The following information is current as at the date of this report.
Mr John Welborn
Experience
Non-Executive Director & Chairman (Independent)
Appointed 16 November 2021
John Welborn is a dynamic industry leader with extensive experience in the resources
sector who was appointed Chairman of the Company in November 2021. Mr Welborn
is currently Managing Director & CEO of Equatorial Resources Limited, Chairman of
Orbital Corporation, a Non-Executive Director of Apollo Minerals Limited and the
President of RugbyWA. Mr Welborn’s experience includes a successful career as a
professional rugby player and more than twenty years as a senior executive in
corporate management, finance, and investment banking.
Mr Welborn is a Chartered Accountant with a Bachelor of Commerce degree from the
University of Western Australia and is a Fellow of the Institute of Chartered
Accountants in Australia, a Fellow of the Australian Institute of Management and is a
member of the Australian Institute of Mining and Metallurgy and the Australian
Institute of Company Directors
Committee Memberships
Not applicable
Equity Interests
12,200,000
Directorships held in other
listed entities
Mr Robert Brierley
Experience
Current directorships:
- Non-Executive Chair – Apollo Minerals from May 2022
- Managing Director and CEO – Equatorial Resources from November 2020
- Chairman – Orbital Corporation from March 2015
Former directorships:
- Managing Director and CEO – Resolute Mining – February 2015 to October 2020
No other listed directorships have been held by Mr Welborn in the previous three years.
Managing Director
Managing Director (appointed 1 March 2019), Executive Director (appointed
21 November 2018), Non-Executive Director (appointed 1 June 2018).
Mr Brierley holds a Bachelor of Engineering (Mining Engineering) and a Graduate
Diploma in Applied Finance and Investment. He is experienced in project and mine
management, corporate finance, leadership, corporate governance, and equities
research. Mr Brierley has significant experience in many mining operations, including
acting as Registered Mine Manager/Quarry Manager at several iron ore mines including
Yandi, Marandoo and Koolan Island.
Additionally, he has over 13 years of experience in financial markets, predominantly as
Head of Equities Research.
Mr Brierley is a Graduate Member of the Australian Institute of Company Directors. He
has had previous Executive and Non-Executive roles with several ASX-listed companies.
Committee Memberships
Not applicable
FENIX RESOURCES LIMITED
- 10 -
DIRECTORS’ REPORT (continued)
Equity Interests
12,750,000 ordinary shares
Directorships held in other
listed entities
Mr Garry Plowright
Experience
Mr Brierley has held no other listed directorships in the last three years.
Non-Executive Director
Appointed 21 November 2018 as Executive Director, and transitioned to Non-Executive
Director 1 January 2021
Mr Plowright is an experienced Executive with over 25 years’ experience in finance,
commercial and technical development within the mining and exploration industry,
working for some of Australia’s leading resource companies. He has been involved in
gold, base metals and iron ore exploration and mining development projects in
Australia and worldwide.
Previous experience includes the supply and logistics of services to the mining and
exploration industry including capital raising, corporate governance and compliance,
project management, mining and environmental approvals and regulations, contract
negotiations, tenure management,
land access, stakeholder and community
engagement.
Mr Plowright has extensive experience in mining law and has provided services to the
industry in property acquisitions, project generation and joint venture negotiations. Mr
Plowright has held global operational and corporate roles with Gindalbie Metals Ltd,
Mt Edon Gold Ltd, Pacmin Mining, Atlas Iron Ltd, Tigris Gold (South Korea) and
Westland Titanium (New Zealand).
Committee Memberships
Not applicable
Equity Interests
13,065,089 ordinary shares
Directorships held in other
listed entities
13,579,883 performance shares
Current directorships:
- Non-Executive Director – Hexagon Energy Materials Ltd from June 2015
No other listed directorships have been held by Mr Plowright in the previous three
years.
Mr Richard Nicholls-Maltman Non-Executive Director (Independent)
Appointed 17 May 2021, resigned 15 November 2021
Experience
Mr Nicholls-Maltman has over 28 years’ experience as a Solicitor practising primarily in
the corporate and resources sectors. He has acted for a number of exploration and
production companies and has a broad range of experience in project development and
mine to port operations and logistics.
He holds Bachelors degrees in Law (with honours) and Commerce (Accounting and
Finance) and a Masters degree in Disaster Preparedness and Reconstruction. He has
worked in disaster recovery projects in Australia, the Pacific Islands, and the Caribbean,
as well as the refugee crisis in Europe.
He is a graduate of the AICD Company Directors and Chairman courses and has previous
experience as a Director and Chairman on an ASX listed exploration and production
company. He is currently a Director of Franco-Nevada Corporation’s Australian
subsidiary and a Director of an Australian based charity operating in Africa.
Committee Memberships
Not applicable
FENIX RESOURCES LIMITED
- 11 -
DIRECTORS’ REPORT (continued)
Equity Interests
30,000 ordinary shares
Directorships held in other
listed entities
Mr Warwick Davies
Experience
Mr Nicholls-Maltman has held no other listed directorships in the last three years.
Non-Executive Director & Chairman (Independent)
Appointed 9 November 2020 as Non-Executive Director, and appointed interim
Chairman on 19 February 2021, resigned 16 November 2021
Mr Davies has worked in the iron ore and minerals industries for over 50 years. Initially
employed by BHP Steel in their Newcastle and Whyalla steel works, he moved to the
Pilbara with Hamersley Iron in 1969 beginning a 4-decade involvement in iron ore in
technical, operational, and commercial roles.
Mr Davies is an Industrial Chemist with a strong economics background where his iron
ore experience was developed with the Robe River organisation until 2001 when a take-
over by Rio Tinto Limited resulted in a career change.
Mr Davies became a consultant working and providing advice to Mt Gibson Iron and
Atlas Iron during their respective start-ups. Mr Davies has extensive experience in all
commercial aspects of the iron ore market including freight supported by his strong
technical marketing background.
Committee Memberships
Not applicable
Equity Interests
30,000 ordinary shares
Directorships held in other
listed entities
Current directorships:
- Managing Director – Resource Mining Corporation Limited. Director from August
2004 to 23 March 2022
No other listed directorships have been held by Mr Davies in the previous three years.
Company Secretary
Ms Shannon Coates
LLB, B(Juris), AGIA, ACIS, GAICD
Ms Coates is a qualified Lawyer, Chartered Secretary, and graduate of the AICD’s Company Directors course. She has
over 25 years’ experience in corporate law and compliance, is Executive Director of national company secretarial and
governance service provider Emerson CoSec and is currently Company Secretary to a number of ASX listed companies,
with a strong focus on resources.
FENIX RESOURCES LIMITED
- 12 -
DIRECTORS’ REPORT (continued)
Meetings of Directors
During the financial year there has been:
- eleven (11) meetings of Directors;
- one (1) meetings of the Audit & Risk Committee; and
- two (2) meetings of the Remuneration Committee.
Directors’
Meetings
Audit & Risk Committee
Meetings (1)
Remuneration Committee
Meetings (1)
Number eligible
to attend
Number
attended
Number eligible
to attend
Number
attended
Number eligible
to attend
Number
attended
J Welborn (2)
R Brierley (3)
G Plowright
R Nicholls-Maltman (4)
W Davies (5)
6
11
11
5
5
6
11
11
5
5
-
-
1
1
1
-
1
1
1
1
-
-
2
2
2
-
2
2
1
2
1 The Board opted to disband the Audit and Risk Committee and Remuneration Committee during the year when the Board reduced in size
to three members
2 Mr Welborn was appointed 16 November 2021.
3 Mr Brierley attended meetings of the Audit & Risk Committee and Remuneration Committee by invitation.
4 Mr Nicholls-Maltman resigned 15 November 2021.
5 Mr Davies resigned 16 November 2021.
REMUNERATION REPORT (AUDITED)
The remuneration report is set out under the following main headings:
A.
B.
C.
D.
E.
F.
G.
H.
I.
Introduction
Remuneration governance
Key management personnel
Remuneration and performance
Remuneration structure
• Executive
• Non-Executive
Executive service agreements
Details of remuneration
Share-based compensation
Other information
This report details the nature and amount of remuneration for each Director and key management personnel of Fenix
Resources Limited.
FENIX RESOURCES LIMITED
- 13 -
DIRECTORS’ REPORT (continued)
REMUNERATION REPORT (AUDITED) (continued)
A.
INTRODUCTION
The remuneration policy of the Company has been designed to align Director and Management objectives with
shareholder and business objectives by providing a fixed remuneration component, and offering specific short-term and
long-term incentives, based on key performance areas affecting the Group’s financial results. Key performance areas
include cash flow management, growth in share price, successful exploration and subsequent exploitation of the Group’s
tenements. The Company believes the remuneration policy to be appropriate and effective in its ability to attract and
retain the best Management and Directors to run and manage the Group, as well as create goal congruence between
Directors, Executives and Shareholders.
During the year the Company has engaged remuneration consultants, The Rewards Group, to provide an Executive
benchmarking report, Non-Executive Director benchmarking report and Incentive structure review.
B.
REMUNERATION GOVERNANCE
The Board retains overall responsibility for remuneration policies and practices of the Company.
The Board opted to disband the Remuneration and Nomination Committee during FY22, when the Board reduced in size
to three members. Currently the full Board undertakes remuneration and nomination responsibilities, in accordance
with a Remuneration and Nomination Committee Charter.
At the 2021 annual general meeting, the Company’s remuneration report was passed by the requisite majority of
Shareholders (77.91% by way of poll).
C.
KEY MANAGEMENT PERSONNEL
The key management personnel in this report are as follows:
Executives – Current
• Robert Brierley
Non-Executive Directors – Current
John Welborn, appointed 16 November 2021
•
• Garry Plowright, appointed 1 January 2021
Non-Executive Directors – Former
• Warwick Davies – appointed 9 November 2020, resigned 16 November 2021
• Richard Nicholls-Maltman, appointed 17 May 2021, resigned 15 November 2021
FENIX RESOURCES LIMITED
- 14 -
DIRECTORS’ REPORT (continued)
REMUNERATION REPORT (AUDITED) (continued)
D.
REMUNERATION AND PERFORMANCE
The following table shows the gross revenue, net profits/(losses) attributable to members of the Company and share
price of the Company at the end of the current and previous four financial years. See Remuneration Structure for short-
term incentives subject to key performance indicators.
Revenue from continuing
operations
Net profit/(loss) attributable to
members of the Company
30 June 2022
$
30 June 2021
$
30 June 2020
$
30 June 2019
$
30 June 2018
$
249,168,360
114,377,844
71,730
31,808
18,904
50,694,460
49,040,926
(1,274,638)
(2,613,166)
(923,420)
Dividend paid
Share price
24,190,497
0.315
-
0.345
-
0.076
-
0.100
-
0.045
E.
REMUNERATION STRUCTURE
Executive remuneration structure
The Board’s policy for determining the nature and amount of remuneration for Senior Executives of the Group is as
follows. The remuneration policy, setting the terms and conditions for Executive Directors and other Senior Executives,
was developed and approved by the Board. All Executives receive a base salary (which is based on factors such as length
of service and experience), superannuation, fringe benefits, options and performance incentives. The Board reviews
Executive packages annually by reference to the Group’s performance, Executive performance, and comparable
information from industry sectors and other listed companies in similar industries.
Executives are also entitled to participate in the employee share option and performance rights plans. If an Executive is
invited to participate in an employee share option or performance rights plan arrangement, the issue and vesting of any
equity securities will be dependent on performance conditions relating to the executive’s role, a tenure based milestone
and the Group’s performance.
The employees of the Group receive a superannuation guarantee contribution required by the Government, which for
the 2022 financial year was 10% and from 1 July 2022 is 10.5%, and do not receive any other retirement benefits.
Short term incentive awards
During the year the Board proposed a cash-based short-term incentive for the Managing Director equal to 50% of his
Total Fixed Remuneration (base salary plus superannuation) on measurement date.
The short-term incentive was assessed against the following key performance indicators, measured at 30 June 2022:
achieved chemical qualities in production compared to forecast levels
achieved lump size in iron ore production
•
•
• minimum number of 24 shipments in the 2022 financial year
•
discretionarily on initiatives generated that either enhance the efficiency, reputation or economic or social benefit
to the Company
One third of the incentives were granted on achievement of any of the above performance indicators. The Board
determined that performance indicators 1 and 2 were met. In addition, the discretionary performance indicator was
deemed to have been met.
FENIX RESOURCES LIMITED
- 15 -
DIRECTORS’ REPORT (continued)
REMUNERATION REPORT (AUDITED) (continued)
Non-Executive remuneration structure
Fees and payment to Non-Executive Directors reflects the demands that are made on them and the responsibilities of
the Directors from time to time.
Non-Executive Directors’ fees and payments are reviewed annually by the Board. For the year ended 30 June 2022,
remuneration for a Non-Executive Director/Chairman was between $50,000 and $80,000 per annum exclusive of
superannuation. There are no termination or retirement benefits paid to Non-Executive Directors (other than statutory
superannuation). At the general meeting held on 2 February 2022, shareholder approved the aggregate amount of fees
that may be paid to non-executive Directors as a whole for the years from and including the year commencing 1 July
2021 be increased from $300,000 per annum to $500,000 per annum. Directors’ fees cover all normal Board activities.
A Director may also be paid fees or other amounts as the Directors determine, if a Director performs special duties or
otherwise performs duties outside the scope of the normal duties of a Director. A Director may also be reimbursed for
out-of-pocket expenses incurred as a result of their directorship or any special duties.
Non-Executive Directors are able to participate in the employee share option or performance rights plans. In addition,
in order to align their interests with those of shareholders, the Non-Executive Directors are encouraged to hold shares
in the Company.
The Company has established an employee options plan (Plan) to attract Directors with suitable qualifications, skills and
experience to plan, carry out and evaluate the Company’s Strategy and to motivate and retain those Directors and
Employees. Participants in the Plan may be Directors of the Company or any of its subsidiaries or any other related body
corporate of the Company.
On 2 February 2022, shareholder approved:
-
-
the Company’s Share Loan Plan, including approval to issue up to 20,000,000 Plan Shares,
the issue of up to 10,000,000 Plan Shares to Mr John Welborn.
The aim of the long-term incentive plans are to allow participation in, and benefit from, the growth of the Company as
a result of their efforts and to assist in motivating and retaining those key employees over the long term.
During the year the Company has engaged remuneration consultants, The Rewards Group, to provide an Executive
benchmarking report, Non-Executive Director benchmarking report and Incentive structure review.
At the 2021 annual general meeting, the Company’s remuneration report was passed by the requisite majority of
Shareholders (77.91% by way of poll).
F.
EXECUTIVE SERVICE AGREEMENTS
Remuneration and other terms of employment for key management personnel are formalised in service agreements.
The service agreements specify the components of remuneration, benefits and notice periods. Participation in the share
and performance rights plans are subject to the Board’s discretion. Other major provisions of the agreements relating
to remuneration are set out below. Termination benefits are within the limits set by the Corporations Act 2001 such
that they do not require shareholder approval.
Contractual arrangement with key management personnel
Executives – Current
Name
Effective date
Term of
agreement
Notice
period
Base salary
per annum
$
Termination
payments
Robert Brierley, Managing Director
01-May-21
No fixed term
3 months
470,000
3 months
FENIX RESOURCES LIMITED
- 16 -
DIRECTORS’ REPORT (continued)
REMUNERATION REPORT (AUDITED) (continued)
G.
DETAILS OF REMUNERATION
Details of remuneration of the key management personnel (KMP) (as defined in AASB 124 Related Party Disclosures) of
the Company is set out below.
Remuneration of KMP for the 2022 financial year is set out below:
Short-term benefits
Post-employment benefits
Cash salary
Non-cash
benefits (1)
Bonus (2)
Super-
annuation
Termination
Share-
based
payments
Options (4)
Total
$
$
$
$
$
$
Executive Directors – Current
R Brierley (3)
470,000
600
235,000
71,675
Non-Executive Director – Current
J Welborn (5)
G Plowright
50,000
50,000
Non-Executive Director – Former
W Davies (6)
R Nicholls-Maltman (7)
30,000
18,750
-
-
-
-
-
-
-
-
5,000
5,000
3,000
1,875
Total
618,750
600
235,000
86,550
-
-
-
-
-
-
-
777,275
59,182
114,182
-
-
-
55,000
33,000
20,625
59,182
1,000,082
1 Other benefits include the provision of a mobile phone allowance.
2 During the year the Board proposed a cash-based short-term incentive for the Managing Director equal to 50% of his Total Fixed
Remuneration at grant date (base salary plus superannuation).
3 At year end, 100% key performance indicators were deemed met.
4 Performance rights granted as part of remuneration package, AASB 2 – Share-Based Payments requires the fair value at grant date of the
performance rights granted to be expensed over the vesting period
5 Mr Welborn was appointed 16 November 2021.
6 Mr Davies resigned 16 November 2021.
7 Mr Nicholls-Maltman resigned 15 November 2021.
The following table sets out each KMP’s relevant interest in fully paid ordinary shares, options, performance rights and
performance shares to acquire shares in the Company, as at 30 June 2022:
Name
R Brierley
J Welborn(1)
G Plowright
Fully paid ordinary
shares
12,750,000
12,200,000
13,065,089
1 Mr Welborn was appointed 16 November 2021.
Options
Performance rights
Performance shares
-
-
-
-
-
-
-
-
13,579,883
FENIX RESOURCES LIMITED
- 17 -
DIRECTORS’ REPORT (continued)
REMUNERATION REPORT (AUDITED) (continued)
Remuneration of KMP for the 2021 financial year is set out below:
Short-term benefits
Post-employment benefits
Cash salary
Non-cash
benefits (1)
Bonus (2)
Super-
annuation
Termination
Total
Share-
based
payments
Performance
rights (3)
$
$
$
$
$
$
Executive Directors – Current
R Brierley (4)
311,667
600
233,932
53,001
Non-Executive Director – Current
W Davies (5)
G Plowright (6)
R Nicholls-Maltman (7)
Executive Directors – Former
42,893
25,000
6,349
-
-
-
G Plowright (6)
42,592
300
Non-Executive Director – Former
G Dixon (8)
Total
81,107
509,608
-
-
-
-
-
4,075
2,375
603
3,943
5,500
7,705
-
14,646
613,846
-
-
-
-
-
46,968
27,375
6,952
52,335
88,812
-
-
-
-
-
900
233,932
71,702
5,500
14,646
836,288
1 Other benefits include the provision of a mobile phone allowance.
2 During the year the Board proposed a cash-based short-term incentive for the Managing Director equal to 50% of his Total Fixed
Remuneration at grant date (base salary plus superannuation).
3 Performance rights granted as part of remuneration package, AASB 2 – Share-Based Payments requires the fair value at grant date of the
performance rights granted to be expensed over the vesting period.
4 At year end, 100% key performance indicators were deemed met.
5 Mr Davies was appointed 9 November 2020 and transitioned to the role of Non-Executive Chairman on 19 February 2021.
6 Mr Plowright transitioned from the role of Executive Director to Non-Executive Director on 1 January 2021.
7 Mr Nicholls-Maltman was appointed on 17 May 2021.
8 Mr Dixon resigned on 19 February 2021.
H.
SHARE-BASED COMPENSATION
Share Loan Plan
On 2 February 2022, shareholders approved the Company’s Share Loan Plan, including approval to issue up to 20,000,000
Plan Shares and the issue of up to 10,000,000 Plan Shares to Mr John Welborn. The Plan Shares have been issued under
a Share Loan Plan and are treated as compensation.
During the year ended 30 June 2022, the following shares issued, vested and/or lapsed to KMP:
Grant
value (2)
Grant date
$
John Welborn – Chairman
Number
granted as
remuneration
Number
vested
during prior
periods
Number
vested
during the
year
Number
vested but
not yet
exercisable
Number
lapsed
during the
year
Maximum
value yet to
expense
$
4-Mar-22 (1)
1,833,649
10,000,000
-
-
-
-
1,774,467
1 The fair value of instruments is calculated as the fair value of the rights at grant date and allocated to remuneration equally over the
period from grant date over the vesting period, refer to Note 22.
2 The securities were approved on the 4 March 2022 at the Company’s General Meeting.
FENIX RESOURCES LIMITED
- 18 -
DIRECTORS’ REPORT (continued)
REMUNERATION REPORT (AUDITED) (continued)
Under AASB 2, shares issued under the Share Loan Plan are treated as options issued. The options are fair valued and
recognised as an expense over the vesting period.
Grant
date (1)
Grant
value (2)
$
Number
issued
Value per
option (3)
$
Expiry
date
Vesting
date
Number
exercised
Vested %
John Welborn – Chairman
4-Mar-22
1,833,649
10,000,000
0.1834
7-Mar-32
-
-
100%
1 The securities were approved on the 4 March 2022 at the Company’s General Meeting.
2 Value of options has been calculated in accordance with AASB 2: Share-Based Payments.
3 Refer to Note 22 of the financial statements for details of the assumptions used in calculating the value of each option as at their grant
date.
Relative proportions of fixed vs variable remuneration expense
The following table shows the relative proportions of remuneration that are linked to performance and those that are
fixed, based on the amounts disclosed as statutory remuneration expense for the 2022 and 2021 financial years:
Fixed
remuneration
At risk STI
At risk LTI
Fixed
remuneration
At risk STI At risk LTI
2022
2021
Executive Directors – Current
R Brierley
70%
30%
-
60%
40%
Non-Executive Director – Current
J Welborn (1)
G Plowright (2)
Executive Directors – Former
G Plowright (2)
Non-Executive Director – Former
G Dixon (3)
W Davies (4)
R Nicholls-Maltman (5)
48%
100%
-
-
-
-
-
-
-
-
-
-
52%
-
-
-
-
-
-
100%
100%
100%
100%
100%
-
-
-
-
-
-
-
-
-
-
-
-
-
1 Mr Welborn was appointed 16 November 2021.
2 Mr Plowright transitioned from the role of Executive Director to Non-Executive Director on 1 January 2021.
3 Mr Dixon resigned on 19 February 2021.
4 Mr Davies resigned on 16 November 2021.
5 Mr Nicholls-Maltman resigned on 15 November 2021.
Shares issued on the exercise of options
The following table shows the ordinary shares issued during the year ended 30 June 2022 on the exercise of options
granted. No further shares have been issued since that date. No amounts are unpaid on any of the shares.
Option grant date
Option exercise date
Exercise price
Shares issued
R Brierley
Fully paid ordinary shares
10-Sep-18
16-Jul-21
$0.08
2,000,000
FENIX RESOURCES LIMITED
- 19 -
DIRECTORS’ REPORT (continued)
REMUNERATION REPORT (AUDITED) (continued)
Reconciliation of equity instruments held by KMP
The following table sets out a reconciliation of each KMP’s relevant interest in ordinary shares and options, performance
rights and performance shares to acquire shares in the Company for the 2022 financial year:
Granted
Acquired
Exercised/
Vested
Lapsed
Other
changes
Balance at
year end/
resignation
date
Balance at
the start of
the
year/period
Executives – Current
R Brierley
Fully paid ordinary shares
Options
16,750,000
2,000,000
Non-Executive Directors – Current
J Welborn (1)
Fully paid ordinary shares
-
-
-
-
2,000,000
(2,000,000)
1,500,000
-
700,000
Fully paid ordinary shares – Share Loan Plan
-
10,000,000
G Plowright
Fully paid ordinary shares
7,029,587
Performance shares
19,615,385
Non-Executives Directors – Former
W Davies (2)
Fully paid ordinary shares
-
R Nicholls-Maltman (3)
Fully paid ordinary shares
-
-
-
-
-
-
-
-
30,000
30,000
1 Mr Welborn was appointed 16 November 2021.
2 Mr Davies resigned 16 November 2021.
3 Mr Nicholls-Maltman resigned on 15 November 2021.
-
-
6,035,502
(6,035,502)
-
-
-
-
-
-
-
-
-
-
(6,000,000)
12,750,000
-
-
-
-
-
-
-
-
2,200,000
10,000,000
13,065,089
13,579,883
30,000
30,000
None of the fully paid ordinary shares above are held nominally by the Directors or any other KMP.
I.
OTHER INFORMATION
Transactions with other related parties
Purchases from entities associated with key management personnel
Director, Mr Richard Nicholls-Maltman, is a Principal of Aphelion Legal Pty Ltd which has provided legal services with the
Company on normal commercial terms and conditions. The expenses recognised during the period were $12,045 (ex
GST) (30 June 2021: $4,840 (ex GST)). Mr Nicholls-Maltman resigned on 15 November 2021.
FENIX RESOURCES LIMITED
- 20 -
DIRECTORS’ REPORT (continued)
This concludes the Remuneration Report which has been audited.
UNISSUED ORDINARY SHARES
Unissued ordinary shares under option/right at the date of this report are 67,500,000 and broken-down as follows:
Performance shares
Issued to Directors
Issued to vendors
13,579,883
53,920,117
Performance shares may be converted subject to various performance milestones.
ENVIRONMENTAL REGULATIONS
The Company’s policy is to comply with, or exceed, its environmental obligations in each jurisdiction in which it operates.
No known environmental breaches have occurred.
INDEMNIFYING OFFICERS
During the financial year, the Company paid a premium in respect of a policy insuring the Company’s Directors,
Secretaries, Executive Officers and any related body corporate against a liability incurred by such a Director, Secretary
or Officer to the extent permitted by the Corporations Act 2001. The policy of insurance prohibits disclosure of the
nature of the liability and the amount of the premium. The Company has entered into Deeds of Indemnity, Insurance
and Access with the Company’s Directors, Secretary and Executive Officers.
The Company has not otherwise, during or since the end of the financial year, except to the extent permitted by law,
indemnified or agreed to indemnify an officer or auditor of the Company or any of the related body corporates against
a liability incurred as such an officer or auditor.
PROCEEDINGS ON BEHALF OF COMPANY
No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings on
behalf of Fenix Resources Limited, or to intervene in any proceedings to which the Company is a party, for the purpose
of taking responsibility on behalf of Fenix Resources Limited for all or part of these proceedings.
No proceedings have been brought or intervened in on behalf of Fenix Resources Limited with leave of the Court under
section 237 of the Corporations Act 2001.
AUDITOR’S INDEPENDENCE DECLARATION
The auditor’s independence declaration, as required under section 307C of the Corporations Act 2001 for the year ended
30 June 2022 has been received and can be found on page 23.
FENIX RESOURCES LIMITED
- 21 -
DIRECTORS’ REPORT (continued)
AUDITOR’S REMUNERATION
During the financial year, the following fees were paid or payable for services provided by related entities of Grant
Thornton Audit Pty Ltd.
Grant Thornton Australia Limited
Other services
Due diligence services
Total remuneration for non-audit services
2022
$
2021
$
47,000
47,000
-
-
The Company may decide to employ the auditor on assignments additional to their statutory audit duties where the
auditor’s expertise and experience with the Company and/or the Group are important.
This report is signed in accordance with a resolution of the Board of Directors made pursuant to section 295(5) of the
Corporations Act 2001.
Signed in accordance with a resolution of the directors
John Welborn
Non-Executive Chairman
Perth
29 August 2022
FENIX RESOURCES LIMITED
- 22 -
Grant Thornton Audit Pty Ltd
Level 43 Central Park
152-158 St Georges Terrace
Perth WA 6000
PO Box 7757
Cloisters Square
Perth WA 6850
T +61 8 9480 2000
Auditor’s Independence Declaration
To the Directors of Fenix Resources Limited
In accordance with the requirements of section 307C of the Corporations Act 2001, as lead auditor for the audit
of Fenix Resources Limited for the year ended 30 June 2022, I declare that, to the best of my knowledge and
belief, there have been:
a no contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the
audit; and
b no contraventions of any applicable code of professional conduct in relation to the audit.
GRANT THORNTON AUDIT PTY LTD
Chartered Accountants
B P Steedman
Partner – Audit & Assurance
Perth, 29 August 2022
www.grantthornton.com.au
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556 389 ACN 127 556 389 and its Australian subsidiaries and related entities. Liability limited by a scheme approved under Professional Standards
Legislation.
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
For the year ended 30 June 2022
Revenue
Cost of sales
Gross profit
Other income
Other expenses
Profit on joint ventures
Operating profit
Finance income
Finance costs
Profit before income tax expense
Income tax expense
Notes
2022
$
2021
$
1
2
3
4
15
5
8
249,168,360
114,377,844
(182,163,120)
(51,313,977)
67,005,240
63,063,867
944,123
51,495
(3,302,802)
(2,200,143)
4,776,607
919,687
69,423,168
61,834,906
407,688
(844,121)
117,770
(96,728)
68,986,735
61,855,948
(18,292,281)
(12,815,022)
Profit after income tax expense for the period
attributable to the owners of the Group
50,694,454
49,040,926
Other comprehensive income
Other comprehensive income for the period, net of tax
-
-
Total comprehensive income for year attributable to
owners of Fenix Resources Limited
50,694,454
49,040,926
Basic earnings per share (cents per share)
Diluted earnings per share (cents per share)
24
24
10.27
9.03
12.06
9.69
The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with
the accompanying notes.
FENIX RESOURCES LIMITED
- 24 -
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 30 June 2022
Notes
2022
$
2021
$
Current Assets
Cash and cash equivalents
Inventories
Other current assets – term deposit
Trade and other receivables
Loan receivable
Non-Current Assets
Mine properties, property, plant and equipment
Capitalised exploration and evaluation expenditure
Loan receivable
Interest in joint venture
Total Assets
Current Liabilities
Trade and other payables
Provisions
Provision for income tax
Lease liabilities
Non-Current Liabilities
Trade and other payables
Provisions
Lease liabilities
Deferred tax liability
Total Liabilities
Net Assets
Equity
Issued capital
Reserves
Retained earnings
Total Equity
10
7
11
11
12
13
14
12
15
16
17
18
16
17
18
9
101,675,767
9,286,984
250,000
6,603,070
509,276
68,995,789
15,003,135
-
3,129,342
1,716,667
118,325,097
88,844,933
25,563,563
24,127,110
1,139,474
466,667
5,696,320
32,866,024
151,191,121
18,760,598
225,779
16,856,835
74,212
35,917,424
1,430,024
1,914,125
299,821
3,408,462
7,052,432
-
933,333
919,692
25,980,135
114,825,068
19,237,744
115,293
9,294,860
664,619
29,312,516
1,473,030
2,176,301
1,347,973
3,253,019
8,250,323
42,969,856
37,562,839
108,221,265
77,262,229
20a
20b
20c
52,166,431
2,759,182
53,295,652
108,221,265
49,831,949
1,297,484
26,132,796
77,262,229
The above consolidated statement of financial position should be read in conjunction with the accompanying notes.
FENIX RESOURCES LIMITED
- 25 -
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 30 June 2022
Issued Capital
$
Reserves
$
Accumulated
Losses
$
Total
$
Balance at 1 July 2020
27,755,148
2,606,557
(22,908,130)
7,453,575
Profit for the year
Other comprehensive income
Total comprehensive income for the year
-
-
-
Transactions with owners in their capacity as owners
Shares issued during the year
Share issue costs
Contribution from options issued during
the year
Performance rights/options expense
recognised during the year
Transfer of reserve upon exercise of
options
15,462,500
(569,418)
5,860,000
-
14,646
1,323,719
(1,323,719)
-
-
-
-
-
-
-
-
-
-
-
-
-
49,040,926
49,040,926
-
-
49,040,926
49,040,926
-
-
-
-
-
15,462,500
(569,418)
5,860,000
14,646
-
50,694,454
50,694,454
-
-
50,694,454
50,694,454
-
-
2,220,000
(83,377)
(24,791,223)
(24,791,223)
-
-
160,000
2,759,182
Balance at 30 June 2021
49,831,949
1,297,484
26,132,796
77,262,229
Profit for the year
Other comprehensive income
Total comprehensive income for the year
-
-
-
Transactions with owners in their capacity as owners
Shares issued during the year
Share issue costs
Dividend
Contribution from options exercised
during the year
Performance shares/options expense
recognised during the year
Transfer of reserves
2,220,000
(83,377)
-
160,000
-
2,759,182
37,859
(1,297,484)
1,259,625
-
Balance at 30 June 2022
52,166,431
2,759,182
53,295,652
108,221,265
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
FENIX RESOURCES LIMITED
- 26 -
CONSOLIDATED STATEMENT OF CASH FLOWS
For the year ended 30 June 2022
Cash flows from operating activities
Receipts from customers
Payments to suppliers and employees
Interest received
Cash flow boost incentive
Income taxes paid
Net cash provided by operating activities
Cash flows from investing activities
Payments for plant and equipment
Payments for exploration and evaluation
Movement in term deposits
Loans from/(to) other entities
Net cash used in investing activities
Cash flows from financing activities
Proceeds from new issues of shares
Proceeds from exercise of options
Share issue costs
Dividends paid
Net cash(used in)/ provided by financing activities
Notes
2022
$
2021
$
247,331,354
114,379,339
(174,703,956)
(49,142,727)
316,835
-
(10,658,242)
13,652
50,000
-
62,285,991
65,300,264
(6,782,293)
(14,729,271)
(119,474)
(250,000)
(143,008)
50,000
1,716,667
(2,650,000)
(5,435,100)
(17,472,279)
-
15,000,000
160,000
5,860,000
-
(836,560)
(24,190,497)
-
(24,030,497)
20,023,440
3
31
11
20
20
20
20
Net increase in cash held
32,820,394
67,851,425
Cash and cash equivalents at the beginning of the period
68,995,789
1,292,625
Effect of exchange rates on cash holdings in foreign currencies
(140,416)
(148,261)
Cash and cash equivalents at the end of the period
10
101,675,767
68,995,789
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes.
FENIX RESOURCES LIMITED
- 27 -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
1
REVENUE
Western Australia Iron Ore
2022
$
2021
$
249,168,360
114,377,844
The Group achieved operating status for the Iron Ridge Project during the prior year, reaching production for accounting
purposes. Included in current period sales is iron ore sold under a hedging arrangement. Fenix Resources entered iron
ore swap arrangements for its Iron Ridge Project for the 12 months from October 2021. The hedge arrangement covers
50,000 tonnes of material per month, calculated at the average monthly iron ore 62 per cent Fe futures index (Platts
IODEX), converted to Australian Dollars. The conversion will result in pricing for iron ore fixed at $230.30 per dry metric
tonne and locks in approximately 45 per cent of planned production for the period, 12 months to October 2022.
The group uses derivative financial instruments such as iron ore forward contracts to manage the risk associated with
commodity price. The sale of iron ore under such hedge instruments is accounted for using the ‘own use exemption’
under AASB 9 Financial Instruments and as such all hedge revenue is recognised in the Statement of Profit or Loss and no
fair value adjustments are subsequently made to sales yet to be delivered under the hedging program.
2
COST OF SALES
Cash costs of production
Inventory product movement
Depreciation and amortisation (1)
2022
$
2021
$
170,429,099
64,386,156
5,716,151
6,017,870
(15,003,135)
1,930,956
182,163,120
51,313,977
1 Refer to Note 34 (m) and 34(n) for details on the Group's accounting policies for depreciation and amortisation.
Costs of production
Costs of production includes ore and waste mining costs, processing costs and site administration and support costs.
Inventory product movement
Inventory product movement represents the movement in inventory ore stockpiles.
3
OTHER INCOME
Other Income
Rebates and other income
Cash flow boost incentive payments (1)
Total other income
2022
$
944,123
-
944,123
2021
$
1,495
50,000
51,495
1 Cash flow boosts payments are delivered as credits in the activity statements and equivalent to the amount withheld from wages
paid to employees from March to September 2020.
FENIX RESOURCES LIMITED
- 28 -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
4
OTHER EXPENSES
Administrative expense
Advertising and marketing costs
Advisory costs
Compliance costs
Consultants
Employee benefits expense (1)
Other administrative expenses
Total administrative expense
Share-based payments expense
Options expense
Performance rights expense
Total share-based payments expense
Notes
2022
$
2021
$
150,369
439,799
345,438
177,972
109,191
76,087
315,747
123,399
1,512,871
1,277,168
617,089
282,616
3,243,538
2,184,208
20(b)
20(b)
59,182
-
59,182
-
14,646
14,646
Depreciation
13
82
1,289
Total other expenses
3,302,802
2,200,143
1 A portion of the prior year employee benefits expense has been capitalised as an exploration and evaluation assets and
recognised in costs of production.
A reconciliation of employee benefits expense is as follows:
Employee benefits expense
Wages and salaries
Superannuation
Provision for annual leave
Other costs
Total employee benefits expense
Employee benefits included in
Capitalised as exploration expenditure
Costs of production
Administrative expenses
Total employee benefits expense
2022
$
2021
$
2,871,887
1,589,926
281,704
110,486
218,840
149,918
103,992
61,941
3,482,917
1,905,777
-
1,970,046
1,512,871
3,482,917
146,134
482,475
1,277,168
1,905,777
FENIX RESOURCES LIMITED
- 29 -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
5
FINANCE COSTS
Finance costs
Interest on Right of Use assets
Unwinding of provisions
Loss on lease disposal
Discount on value of outstanding loan
Interest expense
Total finance costs
6
OPERATING SEGMENTS
2022
$
2021
$
97,455
36,824
726,892
(18,707)
1,657
844,121
94,368
2,360
-
-
-
96,728
The Group has two reportable segments, being the Iron Ridge Project and Trucking Joint Venture. This determination is
based on the internal reports that are reviewed and used by the Board (chief operating decision maker) in assessing
performance and determining the allocation of resources. This internal reporting framework is the most relevant to assist
the Board with making decisions regarding the Group and its production activities. The Group achieved operating status
for the Iron Ridge Project during the prior year, reaching production for accounting purposes.
Iron Ridge
Project
$
Trucking Joint
Venture
$
Unallocated
$
Total
$
For the year ended 30 June 2022
Income from external sources
249,704,795
-
407,688
250,112,483
Reportable segment profit/(loss) (1)
Reportable segment assets (2)
49,656,711
36,965,964
4,776,628
(3,738,885)
50,694,454
5,696,320
108,528,837
151,191,121
Reportable segment liabilities
(42,510,243)
For the year ended 30 June 2021
Income from external sources
114,507,622
-
-
(459,613)
(42,969,856)
167,770
114,675,392
Reportable segment profit/(loss)
Reportable segment assets (3)
49,498,423
41,780,245
919,687
919,692
(1,377,184)
49,040,926
72,125,131
114,825,068
Reportable segment liabilities
(37,189,807)
-
(373,032)
(37,562,839)
1
Included within segment profit/(loss) is depreciation and amortisation of $6,017,870 for the Iron Ridge Project and $82 for
unallocated.
2 Unallocated includes cash held of $101,675,767.
3 Unallocated includes cash held of $68,995,789.
FENIX RESOURCES LIMITED
- 30 -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
7
INVENTORIES
Ore Stockpiles
2022
$
2021
$
9,286,984
15,003,135
The Group achieved operating status for the Iron Ridge Project during the prior period, reaching production for
accounting purposes. Ore stockpiles represent Iron Ore lump and Fines extracted, that are expected to be sold at a profit.
Inventories are valued at the lower of cost and net realisable value. At the reporting date, all inventory on hand is valued
at cost.
No provision was required to write down inventories to their recoverable value at 30 June 2022 (30 June 2021: none).
Accounting estimates and judgements
Inventory valuation
Accounting for inventory involves the use of judgements and estimates, particularly related to the measurement and
valuation of inventory on hand within the production process. Certain estimates, including expected metal recoveries
and work in progress volumes, are calculated by engineers using available industry, engineering and scientific data.
Estimates used are periodically reassessed by the Group after considering technical analysis and historical performance.
Changes in estimates are adjusted for on a prospective basis.
Net realisable value and classification of inventory
The assessment of the net realisable value and classification of inventory involves significant judgements and estimates
in relation to timing and cost of processing, commodity prices, recoveries and the likely timing of sale of the ore produced.
A change in any of these assumptions will alter the estimated net realisable value and may therefore impact the carrying
amount of inventory.
8
TAXATION
Major components of income tax expense for the Years ended 30 June 2022 and 30 June 2021 are:
Statement or profit or loss and other comprehensive income
Current income
Current income tax expense
Adjustments in respect of previous current income tax
Deferred income tax
2022
$
2021
$
18,281,834
9,294,860
(61,618)
-
Relating to origination and reversal of temporary differences
Adjustment in respect of prior year tax losses / deferred tax assets
637,618
(565,553)
3,520,162
-
Income tax expense reported in income statement
18,292,281
12,815,022
FENIX RESOURCES LIMITED
- 31 -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
8
TAXATION (continued)
Statement of changes in equity
Deferred income tax
Capital raising costs
Income tax benefit reported in equity
Reconciliation of income tax to prima facie tax payable
Profit before income tax
Income tax expense/(benefit) at 30% (30 June 2021: 30%)
Tax effect of amounts which are not deductible (taxable) in calculating
taxable income:
2022
$
2021
$
83,378
83,378
(267,142)
(267,142)
68,986,735
20,696,020
61,855,948
18,556,784
Non-deductible expenses (non-assessable income)
(1,691,030)
(10,455)
Tax loss not brought to account as a deferred tax asset now utilised
-
(7,489,754)
Under / over in respect of prior years
Temporary differences brought to account
Total income tax expense
As at 30 June 2022 the franking account balance is $33,432.
Significant accounting judgments and estimates
Income tax classification
(627,171)
-
(85,538)
1,758,447
18,292,281
12,815,022
Judgements: The Group’s accounting policy for taxation, including royalty-related taxation, requires judgement as to the
types of arrangements considered to be a tax on income in contrast to an operating cost.
Uncertain tax matters
Judgements: Judgements apply about the application of income tax legislation and its interaction with income tax
accounting principles. These judgements are subject to risk and uncertainty, hence there is a possibility that changes in
circumstances will alter expectations, which may impact the amount of tax assets and tax liabilities, including deferred
tax, recognised on the balance sheet and the amount of other tax losses and temporary differences not yet recognised.
Where the final tax outcomes are different from the amounts that were initially recorded, these differences impact the
current and deferred tax provisions in the period in which the determination is made.
Measurement of uncertain tax and royalty matters considers a range of possible outcomes, including assessments
received from tax authorities. Where management is of the view that potential liabilities have a low probability of
crystallising, or it is not possible to quantify them reliably, they are disclosed as contingent liabilities.
FENIX RESOURCES LIMITED
- 32 -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
9
DEFERRED TAX ASSETS AND LIABILITIES
For recognition and measurement refer to Note 8 and Note 34(f).
The composition of the Group’s net deferred tax assets and liabilities recognised in the statement of financial position
and the deferred tax expense (credited)/ charged to the statement of profit or loss statement is as follows:
Deferred tax liabilities
Trade and other receivables
Property, plant and equipment
Capitalised exploration and evaluation expenditure
Mine properties
Investments and loans
Deferred tax assets
Trade and other payables
Provisions – current
Right of use assets
Provisions – non-current
Business related costs – statement of profit or loss
Unrealised foreign exchange losses
Business related costs – equity
2022
$
2021
$
(55,798)
(106,206)
(341,842)
(32,804)
(803,194)
(4,093,208)
(3,910,421)
(5,612)
(275,907)
188,208
67,734
112,210
574,237
18,363
49,687
183,765
151,612
34,588
603,778
652,890
14,819
44,478
267,142
Net deferred tax assets/(liabilities)
(3,408,462)
(3,253,019)
The composition of the Group’s unrecognised deferred tax assets and liabilities is as follows:
Deferred tax assets and liabilities not recognised relate to the following:
Capital losses
Net deferred tax assets unrecognised
Significant accounting judgments and estimates
Deferred tax
2022
$
2021
$
7,415
7,415
7,415
7,415
Judgements: Judgement is required to determine the amount of deferred tax assets that are recognised based on the
likely timing and the level of future taxable profits. Judgement is applied in recognising deferred tax liabilities arising from
temporary differences in investments.
Estimates: The Group assesses the recoverability of recognised and unrecognised deferred taxes, including losses on a
consistent basis, using estimates and assumptions relating to projected earnings and cash flows as applied in the Group
impairment process for associated operations.
FENIX RESOURCES LIMITED
- 33 -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
2022
$
2021
$
Cash at bank
71,625,767
55,945,789
Deposits at call
30,050,000
13,050,000
101,675,767
68,995,789
10 CASH AND CASH EQUIVALENTS
(a) Risk exposure
Refer to Note 23(b) for details of the risk exposure and
management of the Group’s cash and cash equivalents.
(b) Restricted cash
The cash and cash equivalents disclosed and in the
statement of cash flows include $600,726 which are held
in trust by the Company’s share registry for the payment
of the 2021 financial year dividend.
(c) Deposits at call
Deposits at call are presented as cash equivalents if they
have a maturity of three months or less. Refer Note 34(j)
for the Group’s other accounting policies on cash and cash
equivalents.
11 TRADE AND OTHER RECEIVABLES AND OTHER CURRENT ASSETS
Due to the short-term nature of the current
receivables, their carrying amount is assumed
to be the same as their fair value.
Other receivables are generally due for
settlement within 30 days and are therefore
classified as current.
Refer to Note 23(b) for details of the risk
exposure and management of the Group’s
trade and other receivables.
The term deposit has a maturity of more than
three months.
Trade and other receivables
Trade receivables
Other receivables
Prepayments
Accrued interest
Other Current Assets
Term deposit
12
LOAN RECEIVABLE
Current loan receivable
Non-current loan receivable
2022
$
2021
$
2,346,000
71,747
3,907,481
2,802,535
154,089
195,500
150,413
104,647
6,603,070
3,129,342
250,000
250,000
-
-
2022
$
509,276
466,667
975,943
2021
$
1,716,667
933,333
2,650,000
During the prior period, the Group has lent money to Fenix Newhaul Pty Ltd, a joint venture company of the Group. Loans
are recognised at amortised cost and shown as current if amounts are due for repayment within 12 months from the
reporting date.
Loans are repayable within a period of 1 to 2 years and incur an interest rate of 1% per annum.
FENIX RESOURCES LIMITED
- 34 -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
12
LOAN RECEIVABLE (continued)
Accounting estimates and judgements
Impairment of financial assets
AASB 9 requires that credit losses on financial assets are measured and recognised using the 'expected credit loss (ECL)
approach. AASB 9’s impairment requirements use forward-looking information to recognise expected credit losses.
Instruments within the scope of the requirements included loans and other debt-type financial assets measured at
amortised cost and FVOCI, trade receivables, contract assets recognised and measured under AASB 15 and loan
commitments and some financial guarantee contracts (for the issuer) that are not measured at fair value through profit
or loss.
The Group considers a broader range of information when assessing credit risk and measuring expected credit losses,
including past events, current conditions, reasonable and supportable forecasts that affect the expected collectability of
the future cash flows of the instrument.
In applying this forward-looking approach, a distinction is made between:
-
-
financial instruments that have not deteriorated significantly in credit quality since initial recognition or that have
low credit risk (‘Stage 1’) and
financial instruments that have deteriorated significantly in credit quality since initial recognition and whose credit
risk is not low (‘Stage 2’).
‘Stage 3’ would cover financial assets that have objective evidence of impairment at the reporting date. ‘12-month
expected credit losses’ are recognised for the first category (i.e. Stage 1) while ‘lifetime expected credit losses’ are
recognised for the second category (i.e. Stage 2).
Measurement of the expected credit losses is determined by a probability-weighted estimate of credit losses over the
expected life of the financial instrument. The Directors have reviewed the forecasts of the Joint Venture and consider the
cash flows to be sufficient to settle the obligations to the company and no expected credit loss has been recorded.
13 MINE PROPERTIES, PROPERTY, PLANT AND EQUIPMENT
Carrying value
Right of use assets
Property
Plant and equipment
Buildings
Plant and equipment
Mine properties
Mine properties, property,
plant and equipment
Total carrying value
2022
$
2021
$
312,524
41,495
379,163
50,351
-
2,247,801
11,715,715
13,493,829
9,247,480
12,202,315
25,563,563
24,127,110
FENIX RESOURCES LIMITED
- 35 -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
13 MINE PROPERTIES, PROPERTY, PLANT AND EQUIPMENT (continued)
Significant accounting estimates and assumptions
Units of production method
Where the useful life of an asset is directly linked to the extraction of ore from a mine, the asset is depreciated using the
units of production method. The units of production method results in depreciation and amortisation charges
proportional to the depletion of the estimated ore reserve of the mine. The unit of account used in the calculation is
tonnes of ore.
Right of use assets
Cost
At 1 July 2021
Additions
Early buy out option exercised
At 30 June 2022
Accumulated depreciation, amortisation and impairment
At 1 July 2021
Depreciation and amortisation
Early buy out option exercised
At 30 June 2022
Net book value
Mine properties, property, plant and equipment
Cost
At 1 July 2021
Additions (1)
Disposals
At 30 June 2022
Accumulated depreciation, amortisation and impairment
At 1 July 2021
Depreciation and amortisation
Disposals
At 30 June 2022
Net book value
Property
$
Plant and
equipment
$
Buildings
$
419,996
3,804
-
55,773
2,544,680
498
-
-
(2,544,680)
423,800
56,271
-
(40,833)
(70,443)
-
(111,276)
312,524
(5,422)
(9,354)
-
(14,776)
41,495
Plant and
equipment
$
Mine properties
under
development
$
9,978,111
5,081,270
(1,808)
15,057,573
(730,631)
(2,613,035)
1,808
(3,341,858)
11,715,715
-
-
-
-
-
-
-
-
(296,879)
(339,291)
636,170
-
-
Mine
properties
$
13,063,235
4,277,344
-
17,340,579
(860,920)
(2,985,830)
(3,846,750)
13,493,829
1 Additions to Mine Properties include value of Performance Shares of $3,900,000, see Note 22(d) for further details.
FENIX RESOURCES LIMITED
- 36 -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
13 MINE PROPERTIES, PROPERTY, PLANT AND EQUIPMENT (continued)
Mine properties include $1.89 million relating to the rehabilitation provision.
A reconciliation of depreciation is as follows:
Depreciation
Costs of production
Administrative expenses
14 EXPLORATION AND EVALUATION ASSETS
Iron Ridge Project
Opening balance
Acquisition of Pharos Project
Exploration expenditure incurred
Expenditure reclassified to mine properties under development
Closing balance
Significant accounting estimates and assumptions
Impairment of capitalised exploration and evaluation expenditure
Note
2022
$
2021
$
6,017,870
1,930,956
4
82
1,289
6,017,952
1,932,245
Note
22(e)
2022
$
2021
$
-
6,203,553
1,020,000
119,474
-
1,139,474
1,234,745
(7,438,298)
-
The future recoverability of capitalised exploration and evaluation expenditure is dependent on a number of factors,
including whether the Group decides to exploit the related lease itself or, if not, whether it successfully recovers the
related exploration and evaluation asset through sale.
Factors that could impact the future recoverability include the level of reserves and resources, future technological
changes, costs of drilling and production, production rates, future legal changes (including changes to environmental
restoration obligations) and changes to commodity prices.
The carrying values of items of exploration and evaluation expenditure are reviewed for impairment indicators when
reclassified from to mine properties under development or at each reporting date and are subject to impairment testing
when events or changes in circumstances indicate that the carrying values may not be recoverable. There is no
impairment during for the year ended 30 June 2022.
Significant accounting judgement
Capitalisation of exploration and evaluation expenditure
The Group has capitalised significant exploration and evaluation expenditure on the basis that this is expected to be
recouped through future successful development (or alternatively sale) of the areas of interest concerned or on the basis
that it is not yet possible to assess whether it will be recouped.
Reclassification to mine properties under development
Once the technical feasibility and commercial viability of the extraction of mineral resources in an area of interest are
demonstrable and a management decision to invest further has been made, exploration and evaluation assets
attributable to that area of interest are first tested for impairment and then reclassified to mine properties under
development.
FENIX RESOURCES LIMITED
- 37 -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
15
INTEREST IN JOINT VENTURE
Interests in joint ventures
Set out below is the joint ventures of the Group as at 30 June 2022. The entities listed below have share capital
consisting solely of ordinary shares, which are held directly by the Group. The country of incorporation or registration
is also their principal place of business, and the proportion of ownership interest is the same as the proportion of voting
rights held.
Name of entity
Place of
business/
country of
incorporation
Measurement
method
% of ownership
interest
%
Quoted fair
value
$
Fenix Newhaul Pty Ltd
Western Australia
Equity method
Schwarze Brothers Pty Ltd
Western Australia
Equity method
30 June 2022
30 June 2021
30 June 2022
30 June 2021
50
50
40
-
N/A (1)
N/A (1)
N/A (1)
-
1 As the entity is a private entity no quoted prices are available.
Fenix Newhaul Pty Ltd
Fenix Resources Limited has formed a strategic alliance with trucking and logistics company, Newhaul Pty Ltd (Newhaul).
Fenix and Newhaul have formed a joint venture company (JVC) known as Fenix Newhaul Pty Ltd (FN). It is intended that
FN will provide all trucking services for the Iron Ridge Project. No guarantees are provided or received with Fenix Newhaul
Pty Ltd.
Opening balance
Share of net profit of joint venture using the equity method
Closing balance
Summarised financial information
2022
$
919,692
4,776,628
5,696,320
2021
$
5
919,687
919,692
The tables below provide summarised financial information of the JVC. The information disclosed below reflects the
amounts presented in the financial statements of the relevant JVC and not the Group's share of those amounts. They
have been amended to reflect adjustments made by the entity when using the equity method including fair value
adjustments. There were no differences in accounting policy.
Summarised statement of financial position
Total current assets
Total non-current assets
Total current liabilities
Total non-current liabilities
2022
$
2021
$
11,257,686
30,388,565
7,071,946
30,190,995
(12,691,450)
(14,847,866)
(17,562,161)
(20,575,691)
11,392,640
1,839,384
FENIX RESOURCES LIMITED
- 38 -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
15
INTEREST IN JOINT VENTURE (continued)
Closing net assets at beginning of the financial year
Profit for the period
Closing net assets
Groups share in equity
Groups share
Investment
Profit recognised
Carrying amount
Revenue
Cost of sales
Operating expense
Interest income
Other expense
Income tax expense
2022
$
2021
$
1,839,384
9,553,256
11,392,640
50%
4,776,628
919,692
4,776,628
5,696,320
-
1,839,384
1,839,384
50%
919,692
5
919,687
919,692
2022
$
2021
$
59,685,192
23,427,111
(33,297,166)
(14,263,990)
(9,387,393)
(3,285,354)
1,100
(3,206,200)
(4,242,277)
90
(3,391,347)
(647,126)
Profit from continuing operations
9,553,256
1,839,384
Profit for the period
Other comprehensive (loss)/income
Total comprehensive income
9,553,256
1,839,384
-
-
9,553,256
1,839,384
Dividends received
-
-
Significant accounting estimates, assumptions, and judgements
Control Assessment
The Directors determined that Fenix and Newhaul jointly control the JVC. The Group has a 50% interest in the issued
capital of this entity, with the other 50% being owned by Newhaul Pty Ltd. Each of the Shareholder groups have one
Board member representing their interests, with decisions around the JVC being made jointly.
Carrying value of interest in joint venture
The JVC has a carrying value of $5.7 million at year end, no impairment indicators have been identified for the Group’s
net investment.
FENIX RESOURCES LIMITED
- 39 -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
15
INTEREST IN JOINT VENTURE (continued)
Schwarze Brothers Pty Ltd
Fenix Resources Limited has formed a strategic alliance with Walarnu Pty Ltd (Walarnu). Fenix and Walarnu have formed
a joint venture company (JVC) known as Schwarze Brothers Pty Ltd (SB). It is intended that SB will provide port services
for the Iron Ridge Project. No guarantees are provided or received with Schwarze Brothers Pty Ltd.
Opening balance
Investment in joint venture
Share of net profit of joint venture using the equity method
Closing balance
Summarised financial information
2022
$
2021
$
-
21
(21)
-
-
-
-
-
The result of the joint venture is not deemed to be material and no further disclosure has been made.
Significant accounting estimates, assumptions, and judgements
Control Assessment
The Directors determined that Fenix and Walarnu jointly control the JVC. The Group has a 40% interest in the issued
capital of this entity, with the other 60% being owned by Walarnu Pty Ltd. Each of the Shareholder groups have one
Board member representing their interests, with decisions around the JVC being made jointly.
Carrying value of interest in joint venture
The JVC has a carrying value of nil at year end, no impairment indicators have been identified for the Group’s net
investment.
16 TRADE AND OTHER PAYABLES
Trade and other payables are normally settled
within 30 days from receipt of notice. All
amounts recognised as trade and other payables,
but not yet invoiced, is expected to settle within
12 months.
The carrying value of trade and other payables
are assumed to be the same as their fair value,
due to their short-term nature.
Refer to Note 23 for details of the risk exposure
and management of the Group’s trade and other
payables.
2022
$
2021
$
Current
Trade payables
11,235,602
6,650,197
Sundry payables
147,900
99,533
Accruals
6,776,370
12,488,014
Dividend payable
600,726
18,760,598
19,237,744
Non-current
Trade payables
1,430,024
1,473,030
FENIX RESOURCES LIMITED
- 40 -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
17 PROVISIONS
Current - Employee benefits
Opening balance
Additional provisions
Amount utilised
Closing balance
Non-current - Rehabilitation and mine closure
Opening balance
Additional provisions
Unwinding of provision
Closing balance
Accounting estimates and judgements
Rehabilitation and mine closure
2022
$
2021
$
115,293
189,498
(79,012)
225,779
2,176,301
21,844
(284,020)
1,914,125
11,301
113,596
(9,604)
115,293
-
2,176,301
-
2,176,301
The provision recognised for rehabilitation and mine closure costs relating to the Iron Ridge Project represents the
discounted value of the present obligation to restore, dismantle and rehabilitate certain items of mine properties,
property, plant and equipment and to rehabilitate the site.
As the discounted value reflects a combination of an assessment of the nature and extent of the work required, the future
cost of performing the work required, the timing of cash flows and the discount rate, then changes to one or more of
these assumptions is likely to result in changes to the carrying amount of the provision and the related rehabilitation
asset and costs and may result in future actual expenditure differing from the amounts currently provided.
18
LEASE LIABILITIES
Current
Lease liabilities
Non-current
Lease liabilities
Maturities of lease liabilities
2022
$
2021
$
74,212
664,619
299,821
374,033
1,347,973
2,012,592
The table below shows the Group’s lease liabilities based on the remaining period at the reporting date to the contractual
maturity date. The amounts disclosed in the table are the contractual undiscounted cash flows.
FENIX RESOURCES LIMITED
- 41 -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
18
LEASE LIABILITIES (continued)
Less than 6
months
$
6 - 12
months
$
1 - 5 years
$
Over 5
years
$
Total
contractual
cash flows
$
Carrying
amount of
liabilities
$
At 30 June 2022
Lease liability
49,564
49,564
338,688
-
437,816
374,033
Accounting estimates and judgements
Leases
The application of AASB 16 requires judgements that affect the valuation of lease liabilities and right of use assets. In
addition to the critical judgements and areas of estimation uncertainty discussed below, the following judgements and
estimations need to be considered when assessing leases:
- determination of stand-alone prices of lease and non-lease components, whether remeasurement or a separate
lease is required following a change in lease terms and conditions, and whether variable payments are in-substance
fixed or not to be included in the calculation of the lease liability; and
- assessments of whether a purchase option will be exercised, or an right of use asset is impaired.
Identifying a lease
Identifying whether a contract is, or contains, a lease involves the exercise of judgement about whether:
-
-
-
the contract depends on a specified asset;
the Group obtains substantially all of the economic benefits from the use of the asset and has the right to direct the
use of the asset; and
the contract is perpetual or for a period of time over which the underlying assets are to be used.
Determining the lease term
The following assessments impact the lease term which may significantly affect the amount of lease liabilities and right
of use assets recognised.
Extension and termination options
The Group applies judgement in determining whether it is reasonably certain to exercise extension or termination
options, by considering all relevant factors that could provide an economic incentive to exercise these options.
Non-cancellable period
In determining the lease term, the assessment of a contract following the contractual non-cancellable period needs to
consider the substance of the contract and whether any economic penalties exist which may affect the term of the non-
cancellable period.
Determining the incremental borrowing rate
Where the Group (or Group entity) cannot readily determine the interest rate implicit in the lease, it uses its incremental
borrowing rate to measure lease liabilities. The incremental borrowing rate is the rate of interest that the Group would
have to pay to borrow over a similar term, and with a similar security, the funds necessary to obtain an asset of a similar
value to the right of use asset in a similar economic environment. Therefore, as the incremental borrowing rate reflects
what the Group would have to pay, estimation is required when no observable rates are available or when observable
rates need to be adjusted to reflect the terms and conditions of the lease.
FENIX RESOURCES LIMITED
- 42 -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
19 FAIR VALUES OF FINANCIAL INSTRUMENTS
This note provides an update on the judgements and estimates made by the Group in determining the fair values of the
financial instruments since the last annual financial report.
Fair value hierarchy
To provide an indication about the reliability of the inputs used in determining fair value, the Group classifies its financial
instruments into the three levels prescribed under the accounting standards. At 30 June 2022 and 2021, no such assets
or liabilities were recorded at fair value.
There were no transfers between levels during the period. The Group's policy is to recognise transfers into and
transfers out of fair value hierarchy levels as at the end of the reporting period.
The fair value of financial assets and liabilities held by the Group must be estimated for recognition, measurement and/or
disclosure purposes.
The Group measures fair values by level, per the following fair value measurement hierarchy:
Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities;
Level 2:
inputs other than quoted prices included within Level 1 that are observable for the asset or liability,
either directly (as prices) or indirectly (derived from prices); and
Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).
The Group’s policy is to recognise transfers into and out of fair value hierarchy levels as at the end of the reporting period.
Valuation techniques used to determine fair values
The fair value of the financial assets and liabilities are included at the amount at which the instrument could be exchanged
in a current transaction between willing parties, other than in a forced or liquidation sale. The carrying amounts of cash
and short-term trade and other receivables, trade payables and other current liabilities approximate their fair values
largely due to the short-term maturities of these payments.
20
ISSUED CAPITAL
(a) Issued Capital
Fully paid
516,213,920
470,213,920
52,166,431
49,831,949
2022
Shares
2021
Shares
2022
$
2021
$
FENIX RESOURCES LIMITED
- 43 -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
20 ISSUED CAPITAL (continued)
Movements in ordinary share capital during the prior and current financial years are as follows:
Details
Balance at 1 July 2020
Share-based payment
Issue of shares
Issue of shares
Notes
Date
Number of
shares
Issue price
$
285,765,644
22(d)
25-Aug-20
2,500,000
27-Aug-20
68,941,410
07-Oct-20
34,506,866
Issue of shares - conversion performance rights
22(b)
14-Oct-20
1,500,000
Issue of shares on exercise of options
22(a)
04-Dec-20
23,125,000
Issue of shares on exercise of options
22(a)
11-Dec-20
14,625,000
Issue of shares on exercise of options
22(a)
17-Dec-20
1,950,000
Issue of shares on exercise of options
22(a)
15-Jan-21
10,800,000
Issue of shares on exercise of options
22(a)
18-Jan-21
5,000,000
Issue of shares on exercise of options
22(a)
18-Jan-21
5,000,000
Issue of shares on exercise of options
22(a)
09-Feb-21
1,000,000
Issue of shares on exercise of options
22(a)
26-Mar-21
1,250,000
Issue of shares on exercise of options
22(a)
23-Apr-21
1,000,000
Issue of shares on exercise of options
22(a)
23-Apr-21
5,000,000
Issue of shares on exercise of options
22(a)
23-Apr-21
5,000,000
Issue of shares on exercise of options
22(a)
24-May-21
1,250,000
Issue of shares on exercise of options
22(a)
04-Jun-21
2,000,000
Less: Share issue costs
Add: Share issue costs claimed as a deduction
8
Transfer of reserve upon exercise of options
20(b)
-
-
-
$
27,755,148
462,500
9,996,504
5,003,496
-
1,850,000
1,170,000
156,000
864,000
350,000
300,000
80,000
100,000
80,000
300,000
350,000
100,000
160,000
(836,560)
267,142
1,323,719
0.185
0.145
0.145
-
0.08
0.08
0.08
0.08
0.07
0.06
0.08
0.08
0.08
0.06
0.07
0.08
0.08
-
-
-
Balance at 30 June 2021
470,213,920
49,831,949
Issue of shares on exercise of options
22(b)
16-Jul-21
2,000,000
0.08
160,000
Issue of shares - conversion performance shares
22(d)
01-Dec-21
30,000,000
Issue of shares – Employee share loan plan
22(c)
08-Mar-22
10,000,000
-
-
1,200,000
-
Issue of shares - Acquisition of tenement rights
22(e)
10-Mar-22
4,000,000
0.255
1,020,000
Less: Share issue costs
Add: Share issue costs claimed as a deduction
8
Transfer of reserve upon exercise of options
20(b)
-
-
-
-
-
-
-
(83,377)
37,859
Balance at 30 June 2022
516,213,920
52,166,431
FENIX RESOURCES LIMITED
- 44 -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
20 ISSUED CAPITAL (continued)
(b) Reserves
The following table shows a breakdown of the reserves and the movements in these reserves during the year. A
description of the nature and purpose of each reserve is provided.
Share-based payments reserve
Balance at 1 July
Performance rights expense – Directors and employees
Performance shares capitalised to mine properties
Options issued – Employee share plan
Note
22(b)
22(d)
22(c)
2022
$
2021
$
1,297,484
2,606,557
-
14,646
2,700,000
59,182
-
Transfer of reserve upon exercise of options
(37,859)
(1,323,719)
Transfer of historical reserve to retained earnings
20(c)
(1,259,625)
-
Balance at 30 June
Share- based payments reserve
2,759,182
1,297,484
The share-based payments reserve is used to recognise: (a) the grant date fair value of options issued but not exercised;
(b) the grant date fair value of market-based performance rights granted to Directors, Employees, Consultants and
Vendors but not yet vested; and (c) the fair value non-market based performance rights granted to Directors, Employees,
Consultants and Vendors but not yet vested.
(c) Retained earnings
Balance at 1 July
Net profit attributable to owners of the Company
Transfer of historical reserve to retained earnings
Dividend declared
Balance at 30 June
21 DIVIDENDS
2022
$
2021
$
26,132,796
(22,908,130)
50,694,454
49,040,926
1,259,625
(24,791,223)
-
-
53,295,652
26,132,796
Dividends are determined after period-end and announced with the results for the period. Dividends determined are not
recorded as a liability at the end of the period to which they relate. Dividends are recognised upon declaration.
On 14 September 2021, Fenix Resources Limited determined a final dividend of 5.25 cents per share fully franked. Fenix
Dividends declared were fully franked based on a tax rate of 30 per cent.
Fenix did not pay an interim dividend during the year due to the unavailability of franking credits. A decision on a full year
dividend payment for FY22 will be made based on the full year financial results consistent with the Company’s dividend
policy.
FENIX RESOURCES LIMITED
- 45 -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
21 DIVIDENDS (continued)
Dividend policy
The Group adopted a dividend policy in August 2021 that provides for, to the extent that dividends can be fully franked,
a payment of between 50% and 80% of after-tax earnings to Shareholders in the form of dividends, either annually or
semi-annually.
22 SHARE-BASED PAYMENTS
Share-based payment transactions are recognised at fair value in accordance with AASB 2 Share-based payments.
The total movement arising from share-based payment transactions recognised during the year were as follows:
As part of share-based payment expense
Options issued – Director & Employee share plan
Performance rights issued
As part of capitalised exploration assets
Ordinary shares
Performance shares
Notes
22(c)
22(b)
22(e)
22(d)
2022
$
2021
$
59,182
-
1,020,000
3,900,000
4,979,182
-
14,646
462,500
-
477,146
During the year the Group had the following share-based payments:
(a) Share options
The Fenix Resources Limited share options are used to reward Directors, Employees, Consultants and Advisors for their
performance and to align their remuneration with the creation of Shareholder wealth through the performance
requirements attached to the options. Options are granted at the discretion of the Board of Directors and no individual
has a contractual right to participate in the plan or to receive any guaranteed benefits. Any options granted to Directors
are approved by Shareholders prior to issue.
The options are not listed and carry no dividend or voting right. Upon exercise, each option is convertible into one
ordinary share to rank pari passu in all respects with the Company’s existing fully paid ordinary shares.
No options have been granted during the reporting period.
The total expense arising from options issued during the reporting period as part of share-based payments expense was
nil (30 June 2021: nil).
Set out below are summaries of options granted:
2022
2021
Average exercise
price per option
Number of
options
Average exercise
price per option
Number of
options
Opening balance
Granted during the period
Exercised during the period
Closing balance
Vested and exercisable
$0.080
-
$0.080
-
-
FENIX RESOURCES LIMITED
2,000,000
$0.076
79,000,000
-
-
(2,000,000)
-
-
$0.076
$0.080
$0.080
-
(77,000,000)
2,000,000
2,000,000
- 46 -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
22 SHARE-BASED PAYMENTS (continued)
Series
Grant date
Expiry date
Exercise price
2022
Number of options
2021
Number of options
(i)
10-Sep-18 (1)
9-Sep-21
$0.08
-
2,000,000
Weighted average remaining contractual life of options outstanding at the
end of the year:
-
0.19 years
1 The securities were approved on the 10 September 2018 at the Company’s General Meeting.
The fair value of options issued is measured by reference to the value of the goods or services received. The fair value of
services received in return for share options granted to Directors, Employees and Consultants is measured by reference
to the fair value of options granted. The fair value of services received by Advisors couldn’t be reliably measured and are
therefore measured by reference to the fair value of the equity instruments granted. The estimate of the fair value of
the services is measured based on a Black-Scholes option valuation methodology. The life of the options including early
exercise options are built into the option model. The fair value of the options are expensed over the expected vesting
period.
(b) Performance rights
The Company’s Performance Rights Plan was approved and adopted by Shareholders on 10 September 2018. Each
performance right will vest as an entitlement to one fully paid ordinary share upon achievement of certain performance
milestones. If the performance milestones are not met, the performance rights will lapse, and the eligible participant will
have no entitlement to any shares.
Performance rights are not listed and carry no dividend or voting rights. Upon exercise each performance right is
convertible into one fully paid ordinary share to rank pari passu in all respects with existing fully paid ordinary shares.
No performance rights have been granted during the reporting period and there are no performance rights on issue at
period end (30 June 2021: none).
The total Director, Employee and Consultant share performance rights expense arising from performance rights
recognised during the reporting period as part of share-based payment expense were as follows:
Performance rights granted during prior periods
2022
$
2021
$
-
-
14,646
14,646
(c) Share Loan Plan
The Company’s Share Loan Plan was approved and adopted by Shareholders on 2 February 2022. The Fenix Resources
Limited Share Loan Plan is used to reward Directors and employees for their performance and to align their remuneration
with the creation of long-term shareholder wealth through increase in share price. Loans are granted at the discretion
of the Board of Directors and no individual has a contractual right to participate in the plan or to receive any guaranteed
benefits. Any Director participation is approved by shareholders prior to issue.
Under the Share Loan Plan, provision for the issuance of loan shares is as follows:
-
Loan shares are shares in the Company, each carrying the same dividend rights and otherwise ranking pari passu in
all respects with the ordinary issued shares of the Company, where the subscription price is funded by way of a loan
from the Company;
- Offers under the plan are the absolute discretion of the board;
FENIX RESOURCES LIMITED
- 47 -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
22 SHARE-BASED PAYMENTS (continued)
- Financial assistance is provided to participants by way of a limited recourse interest-free loan to acquire the shares;
- The Company retains security over the loan shares whilst ever there is an amount outstanding under the loan; and
-
Loan shares that have not vested and/or are subject to loan repayment will be restricted from trading.
Under the applicable Accounting Standards, the loan shares and related limited recourse loan are accounted for as
options, which gives rise to a share-based payment expense. The treatment of the loan shares under the applicable
Accounting Standards as options requires that the value of the loans and issue price of the shares are not recorded as
receivables or share capital of the Company until repayment or part repayment of the loans occurs. The loan shares are
entitled to dividends. Half of any dividends paid in respect of the loan shares will be applied to reduce the loans and
increase share capital in accordance with both the plan rules and applicable Accounting Standards.
The options are fair valued and recognised as an expense over the vesting period.
Set out below are summaries of shares issued under the Share Loan Plan:
2022
2021
Average repayment
price
Number of
shares
Average repayment
price
Number of
shares
Opening balance
-
-
Granted during the period
$0.23
10,000,000
Exercised during the period
-
-
Closing balance
$0.23
10,000,000
-
-
-
-
-
-
-
-
Series
Grant date
Expiry date
Exercise price
2022
Number of shares
2021
Number of shares
(i)
4-Mar-22 (1)
7-Mar-32
$0.23
10,000,000
-
Weighted average remaining contractual life of shares outstanding at the
end of the year:
9.69 years
-
1 The securities were approved on the 4 March 2022 at the Company’s General Meeting.
The fair value of services received in return for shares issued to Directors and employees is measured by reference to the
fair value as options granted. The estimate of the fair value of the services is measured based on a Black-Scholes option
valuation methodology. The life of the options including early exercise options are built into the option model. The fair
value of the options are expensed over the expected vesting period.
The model inputs for options granted during the period include:
Series
Exercise
price
Expiry (years)
Share price at
grant date (1)
Expected
volatility (2)
Dividend
yield
Risk free
interest rate
(3)
Option
value
(i)
$0.230
10.00
$0.235
73%
0%
2.14%
$0.1834
1 The share price has been based upon the closing shares price on grant date being 4 March 2022.
2 The expected price volatility is based on historical volatility (based on the remaining life of the option), adjusted for any expected
changes to future volatility due to publicly available information.
3 Risk free rate of securities with comparable terms to maturity.
FENIX RESOURCES LIMITED
- 48 -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
22 SHARE-BASED PAYMENTS (continued)
The total expense arising from shares issued during the reporting period as part of share-based payments expense was:
Series
(i)
Director shares
(d) Performance shares
2022
$
2021
$
59,182
59,182
-
-
On 22 November 2018 the Company issued 55,000,000 shares and 112,500,000 performance shares to the vendors of
Prometheus Mining Pty Ltd in consideration for the acquisition of 100% of the mining lease M20/118-I.
Performance shares were split between four milestones, being 15 million under Milestone A, 30 million under
Milestone B, 37.5 million under Milestone C and 30 million under Milestone D. On achievement of the milestones each
performance share will convert into one ordinary fully paid share, if the milestones are not achieved the performance
shares consolidate and entitle each holder to one ordinary fully paid share per holder per milestone.
There are a total of 11 holders of the performance shares.
Milestones are as follows:
Milestone A
Milestone B
Milestone C
Milestone D
On declaration of an Inferred Mineral Resource of not less than 8 million tonnes of iron ore at 65% Fe
grade in accordance with the JORC Code of 2012 within 6 months from commencement of drilling on
the Tenement.
On achievement of 1,000,000 tonnes cumulative of shipped iron ore production from the Tenement
at an Operating Margin of greater than US$15 per dry metric tonne shipped within the earlier of 24
months from commencement of mining on the Tenement and 60 months from the Settlement Date.
On achievement of 2,000,000 tonnes cumulative of shipped iron ore production from the Tenement
at an Operating Margin of greater than US$15 per dry metric tonne shipped within the earlier of 36
months from commencement of mining on the Tenement and 60 months from the Settlement Date.
On achievement of 3,000,000 tonnes cumulative of shipped iron ore production from the Tenement
at an Operating Margin of greater than US$15 per dry metric tonne shipped within the earlier of 48
months from commencement of mining on the Tenement and 60 months from the Settlement Date.
The fair value of consideration is by reference to the fair value of the shares and performance shares issued in connection
with the acquisition. The fair value of the consideration will be included in the capitalised cost of the asset.
The fair value of the shares issued is determined by reference to the share price on acquisition date, based on the fair
value price ($0.04 per share).
During the prior financial periods
On issuance of the performance shares on acquisition the Directors determined that it was not probable that the
milestones would be met and accordingly the value of the performance shares was calculated to be nil.
On 9 July 2019, the Company advised that 15,000,000 Class A Performance Shares had not met the requirement for
conversion and, pursuant to the terms and conditions of the Performance Shares, all unconverted Class A Performance
Shares held by each holder were automatically consolidated into one Share each. As a result, during the prior year 11
ordinary fully paid shares were issued to holders of the performance shares.
FENIX RESOURCES LIMITED
- 49 -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
22 SHARE-BASED PAYMENTS (continued)
During the financial period
On 1 December 2021, the Company advised that 30,000,000 Class B Performance Shares had met the requirement for
conversion and, pursuant to the terms and conditions of the Performance Shares, all Class B Performance Shares were
converted into 30,000,000 ordinary fully paid shares were issued to holders of the performance shares (see Note 20(a)).
The share issued were recognised at fair value by reference to the share price on acquisition date, based on the fair value
price ($0.04 per share). This amount has been recognised in the Statement of Financial Position under Mine properties.
The probability of meeting Milestones C and D were reassessed at 30 June 2022 and assigned probabilities of 100% and
75% respectively therefore deemed likely to be met. In accordance with AASB 2 “Share Based Payments” the fair value
of the performance shares must be recognised at 30 June 2022. The fair value of the shares issued was determined by
reference to the share price on acquisition date, based on the fair value price ($0.04 per share). The value of the
performance shares was determined using a share option pricing model, after assigning a probability of achievement this
was determined to be Milestone C $1,500,000 and Milestone D $1,200,000. As the shares have not been issued as of 30
June 2022 the fair value of the performance shares were credited to a reserve account in equity. This amount has been
recognised in the Statement of Financial Position under Mine properties.
(e) Share capital to vendors
During the financial period:
- On 10 March 2022, 4,000,000 fully paid ordinary shares issued to Scorpion as consideration for the acquisition of
100% interest in the Iron Ore rights on the Pharos Project Tenements. The fair value of the shares recognised was
by direct reference to the closing price on 10 March 2022 which amounted to $1,020,000. This amount has been
recognised in the Statement of Financial Position under exploration and evaluation expenditure.
During the prior financial period:
- On 25 August 2020, 2,500,000 shares issued in part consideration for Mining Co-operation and Benefits Agreement
with the Wajarri Yamatji Native Title group. The fair value of the shares recognised was by direct reference to the
closing price on 24 August 2020 which amounted to $462,500. This amount has been recognised in the Statement
of Financial Position under Mine properties under development.
Significant accounting estimates, assumptions and judgements
Estimation of fair value of share-based payments
The Group measures the cost of equity-settled transactions by reference to the fair value of the equity instruments at
the date at which they are granted. The fair value is determined using the Black-Scholes or Monte-Carlo model taking
into account the assumptions detailed within this note.
Probability of vesting conditions being achieved
Inputs to pricing models may require an estimation of reasonable expectations about achievement of future vesting
conditions. Vesting conditions must be satisfied for the counterparty to become entitled to receive cash, other assets or
equity instruments of the entity, under a share-based payment arrangement.
Vesting conditions include service conditions, which require the other party to complete a specified period of service,
and performance conditions, which require specified performance targets to be met (such as a specified increase in the
entity's profit over a specified period of time) or completion of performance hurdles.
The Group recognises an amount for the goods or services received during the vesting period based on the best available
estimate of the number of equity instruments expected to vest and shall revise that estimate, if necessary, if subsequent
information indicates that the number of equity instruments expected to vest differs from previous estimates. On vesting
date, the entity shall revise the estimate to equal the number of equity instruments that ultimately vested.
The achievement of future vesting conditions are reassessed each reporting period.
FENIX RESOURCES LIMITED
- 50 -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
23 FINANCIAL AND CAPITAL RISK MANAGEMENT
Overview
The financial risks that arise during the normal course of the Group’s operations comprise market risk, credit risk and
liquidity risk. In managing financial risk, it is policy to seek a balance between the potential adverse effects of financial
risks on financial performance and position, and the "upside" potential made possible by exposure to these risks and by
taking into account the costs and expected benefits of the various risk management methods available to manage them.
General objectives, policies and processes
The Board is responsible for approving policies on risk oversight and management and ensuring management has
developed and implemented effective risk management and internal control. The Board receives reports as required
from the Managing Director in which they review the effectiveness of the processes implemented and the
appropriateness of the objectives and policies it sets. The Board oversees how management monitors compliance with
the Group's risk management policies and procedures and reviews the adequacy of the risk management framework in
relation to the risks faced.
These disclosures are not, nor are they intended to be an exhaustive list of risks to which the Group is exposed.
Financial Instruments
The Group has the following financial instruments:
Financial assets
Current
Cash and cash equivalents
Trade and other receivables
Loan receivable
Other current assets
Non-Current
Loan receivable
Financial liabilities
Current
Trade and other payables
Lease liabilities
Non-Current
Trade and other payables
Lease liabilities
2022
$
2021
$
101,675,767
68,995,789
2,744,888
509,276
250,000
176,394
1,716,667
-
466,667
933,333
105,646,598
71,822,183
18,780,612
19,237,744
74,212
664,619
1,430,025
299,821
1,473,030
1,347,973
20,584,670
22,723,366
FENIX RESOURCES LIMITED
- 51 -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
23
FINANCIAL AND CAPITAL RISK MANAGEMENT (continued)
(a) Market Risk
Market risk can arise from the Group’s use of interest-bearing financial instruments and exposure to commodity prices.
It is a risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in interest
rates (interest rate risk), foreign exchange rate (foreign exchange risk) and fluctuations in commodity prices (commodity
price risk).
(i)
Interest rate risk
The Board manages the Group's exposure to interest rate risk by regularly assessing exposure, taking into account funding
requirements and selecting appropriate instruments to manage its exposure. As at the 30 June 2022, the Group has
interest-bearing assets, being cash at bank and borrowings (30 June 2021 cash at bank).
As such, the Group's income and operating cash flows is not highly dependent on material changes in market interest
rates.
Sensitivity analysis
The Group does not consider this to be a material risk/exposure to the Group and have therefore not undertaken any
further analysis.
The weighted average effective interest rate of funds on deposit is 0.77% (30 June 2021: 0.30%).
(ii) Foreign exchange risk
The Group is exposed to foreign exchange risk arising from fluctuations in the US dollar.
Foreign exchange risk arises from future commercial transactions and recognised assets and liabilities denominated in a
currency that is not the Company’s functional currency. The Group manages risk by matching receipts and payments in
the same currency and monitoring movements in exchange rates. The exposure to risks is measured using sensitivity
analysis and cash flow forecasting.
The Group’s exposure to foreign currency risk at the end of the reporting period, expressed in Australian dollars, was as
follows:
Financial assets
Cash
Financial liabilities
2022
US
$
2021
US
$
12,775,283
8,578,857
Trade and other payables
1,378,895
1,425,976
Sensitivity analysis
A hypothetical change of 10% in the US dollar exchange rate was used to calculate the Group's sensitivity to foreign
exchange rate movements as the Company’s estimate of possible rate movements over the coming year taking into
account current market conditions and past volatility.
A weakening of the US dollar by 10%, with all other variables held constant, would decrease the Group's equity and profit
after taxation by $784,903 (2021: $538,648). These sensitivities should not be used to forecast the future effect of
movement in the Australian dollar exchange rate on future cash flows.
FENIX RESOURCES LIMITED
- 52 -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
23
FINANCIAL AND CAPITAL RISK MANAGEMENT (continued)
(iii) Commodity price risk
The risk associated with commodity prices is managed as part of the portfolio risk management strategy.
Fenix Resources entered into iron ore swap arrangements for its Iron Ridge Project for the 12 months from October 2021.
The hedge arrangement covers 50,000 tonnes of material per month, calculated at the average monthly iron ore 62 per
cent Fe futures index (Platts IODEX), converted to Australian Dollars. The conversion will result in pricing for iron ore fixed
at $230.30 per dry metric tonne and locks in around 45 per cent of planned production for the period.
The group uses derivative financial instruments such as iron ore forward contracts to manage the risk associated with
commodity price. All other production is on market-based index pricing terms.
The relationship between commodity prices and foreign currencies is complex and movements in foreign exchange rates
can impact commodity prices.
(b) Credit risk
Credit risk arises from cash and cash equivalents and deposits with financial institutions, as well as trade receivables.
Credit risk is managed on a Group basis. For cash balances held with bank or financial institutions, only independently
rated parties with a minimum rating of ‘AA-’ are accepted.
The Board are of the opinion that the credit risk arising as a result of the concentration of the Group's assets is more than
offset by the potential benefits gained.
The maximum exposure to credit risk at the reporting date is the carrying amount of the assets as summarised, none of
which are impaired or past due.
Exposure to credit risk
The carrying amount of the Group’s
financial assets represents the maximum
credit exposure. The Group’s maximum
exposure to credit risk at the reporting
date was:
2022
$
2021
$
Cash and cash equivalents
101,675,767
68,995,789
Trade and other receivables
2,744,888
176,394
Other current assets
Loan receivable
250,000
975,943
-
2,650,000
105,646,598
71,822,183
The credit quality of financial assets that are neither past due nor impaired can be assessed by reference to external
credit ratings (if available) or to historical information about counterparty default rates.
Other receivables
Counterparties with external credit ratings
Counterparties without external credit ratings (1)
Group 1
Group 2
Group 3
Total
2022
$
2021
$
-
-
-
-
2,744,888
2,826,394
-
-
2,744,888
2,826,394
FENIX RESOURCES LIMITED
- 53 -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
23 FINANCIAL AND CAPITAL RISK MANAGEMENT (continued)
Other current assets – term deposit
Held with Australian banks and financial institutions
AA- S&P rating
Total
2022
$
2021
$
250,000
250,000
-
-
1 Group 1 — new customers (less than 6 months)
Group 2 — existing customers (more than 6 months) with no defaults in the past
Group 3 — existing customers (more than 6 months) with some defaults in the past. All defaults were fully recovered.
Cash at bank and short-term deposits
Held with Australian banks and financial institutions
AA- S&P rating
Total
(c)
Liquidity risk
2022
$
2021
$
101,675,767
68,995,789
101,675,767
68,995,789
Liquidity risk is the risk that the Group will not be able to meet its financial obligations 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. Through continuous monitoring of forecast and actual cash flows the Group manages liquidity
risk by maintaining adequate reserves to meet future cash needs. The decision on how the Group will raise future capital
will depend on market conditions existing at that time.
Maturities of financial liabilities
The table below analyses the Group’s financial liabilities into relevant maturity groupings based on the remaining period
at the reporting date to the contractual maturity date. The amounts disclosed in the table are the contractual
undiscounted cash flows.
Less than 6
months
$
6 - 12
months
$
1 – 5
years
$
Over 5
years
$
Total
contractual
cash flows
$
Carrying
amount of
liabilities
$
At 30 June 2022
Trade and other payables
18,776,612
-
1,430,025
Lease liabilities
At 30 June 2021
49,564
49,564
338,688
-
-
20,206,637
20,206,637
437,816
374,033
Trade and other payables
19,237,744
-
1,473,030
-
20,710,774
20,710,774
Lease liabilities
394,214
395,031
1,502,217
46,470
2,337,932
2,012,592
(d) Capital risk management
The Group’s objective when managing capital is to safeguard the ability to continue as a going concern. This is to provide
returns for shareholders, benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost
of capital.
The Board monitors capital on an ad-hoc basis. No formal targets are in place for return on capital or gearing ratios.
FENIX RESOURCES LIMITED
- 54 -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
24 EARNING/LOSS PER SHARE
Options
Options granted to employees and Directors under the Incentive Option Scheme are considered to be potential ordinary
shares and have been included in the determination of diluted earnings per share to the extent to which they are dilutive.
The options have not been included in the determination of basic earnings per share. Details relating to the options are
set out in Note 22.
Performance shares
Performance shares granted to vendors of Prometheus in consideration for the acquisition of 100% of the mining lease
M20/118-I are considered to be potential ordinary shares and have been included in the determination of diluted
earnings per share to the extent to which they are dilutive. The performance shares have not been included in the
determination of basic earnings per share. Details relating to the performance shares are set out in Note 22.
Basic earnings/(loss) per share
Net profit/(loss) after tax attributable to the members of the Company
$ 50,694,454
$ 49,040,926
Weighted average number of ordinary shares
Basic earnings/(loss) per share (cents)
493,819,399
406,764,998
10.27
12.06
2022
2021
Net profit /(loss) after tax attributable to the members of the Company
$ 50,694,454
$ 49,040,926
Weighted average number of ordinary shares
493,819,399
406,764,998
Adjustments for calculation of diluted earnings per share
Options
Performance shares
-
2,000,000
67,500,000
97,500,000
Weighted average number of ordinary shares and potential ordinary shares
561,319,399
506,264,998
Diluted earnings/(loss) per share (cents)
9.03
9.69
25 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS
The preparation of the financial statements requires the use of accounting estimates which, by definition, will seldom
equal the actual results. Management also needs to exercise judgement in applying the Group's accounting policies.
This Note provides an overview of the areas that involved a higher degree of judgement or complexity and items which
are more likely to be materially adjusted. Detailed information about each of these estimates and judgements is included
in the Notes together with information about the basis of calculation for each affected line item in the financial
statements.
Significant accounting estimates and judgements
The areas involving significant estimates or judgements are:
-
-
Inventory valuation – Note 7;
Income tax classification – Note 8;
- Uncertain tax matters – Note 8;
- Units of production amortisation method – Note 13;
-
Impairment of assets – Note 14;
FENIX RESOURCES LIMITED
- 55 -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
25 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (continued)
- Capitalisation of exploration expenditure – Note 14;
- Reclassification to mine properties under development – Note 14;
- Rehabilitation and mine closure – Note 17;
-
Identification of leases – Note 18;
- Determination of incremental borrowing rate – Note 18;
- Probability of vesting conditions being achieved– Note 22; and
- Estimation of fair value of share-based payments – Note 22.
Estimates and judgements are continually evaluated. They are based on historical experience and other factors, including
expectations of future events that may have a financial impact on the entity and that are believed to be reasonable under
the circumstances.
There have been no actual adjustments this year as a result of an error and of changes to previous estimates.
26
CONTINGENCIES
(a) Contingent liabilities
There were no material contingent liabilities not provided for in the financial statements of the Company as at 30 June
2022 or 30 June 2021 other than:
Native Title and Aboriginal Heritage
Native title claims have been made with respect to areas which include tenements in which the Company has an interest.
The Company is unable to determine the prospects for success or otherwise of the claims and, in any event, whether or
not and to what extent the claims may significantly affect the Company or its projects. Agreement is being or has been
reached with various native title claimants in relation to Aboriginal Heritage issues regarding certain areas in which the
Company has an interest.
(b) Contingent assets
There were no material contingent assets as at 30 June 2022 or 30 June 2021.
27 COMMITMENTS
Significant capital expenditure contracted for at the end of the reporting period but not recognised as a liability is as
follows:
Within one year
Later than one year but no later than five years
Later than five years
1 Commitment for the Iron Ridge Project and Pharos project
2 Commitment for the Iron Ridge Project and under the Scorpion farm-in agreement.
2022 (1)
$
2021 (2)
$
59,500
460,996
156,349
676,845
359,804
112,637
164,196
636,637
FENIX RESOURCES LIMITED
- 56 -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
28
INTEREST IN OTHER ENTITIES
(a) Investments in controlled entities
The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in
accordance with the accounting policy described in Note 34(a):
Name of entity
Country of
incorporation
2022
Equity holding
2021
Equity holding
Prometheus Mining Pty Ltd (1)
Australia
100%
100%
1 Subsidiary acquired on 22 November 2018.
29 RELATED PARTY TRANSACTIONS
Transactions with related parties are on normal commercial terms and conditions no more favourable than those
available to other parties unless otherwise stated.
Key management personnel compensation
Short-term employee benefits
Post-employment benefits
Share-based payments
2022
$
854,350
86,550
59,182
1,000,082
2021
$
744,440
77,202
14,646
836,288
Detailed remuneration disclosures are provided within the remuneration report.
Parent entity
The ultimate parent entity and ultimate controlling party is Fenix Resources Limited (incorporated in Australia).
Subsidiaries
Interests in subsidiaries are set out in Note 28.
Transactions with related parties
During the prior year, the Group has lent money to Fenix Newhaul Pty Ltd, a joint venture company of the Group. Loans
are repayable within a period of 1 to 2 years and incur an interest rate of 1% (see Note 12).
During the year Fenix-Newhaul Pty Ltd have provided transportation services to the Iron Ridge Project on normal
commercial terms and conditions, the expenses recognised during the period were $62,755,455 (ex GST) (30 June 2021:
$23,488,161 (ex GST)).
There were no other related party transaction during the period.
Transactions with other related parties
Purchases from entities associated with key management personnel
Director, Mr Richard Nicholls-Maltman, is a Principal of Aphelion Legal Pty Ltd which has provided legal services with the
Company on normal commercial terms and conditions. The expenses recognised during the period were $12,045 (30 June
20-21: $4,840 (ex GST)).
FENIX RESOURCES LIMITED
- 57 -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
30 EVENTS SUBSEQUENT TO REPORTING DATE
Subsequent to the end of the reporting period:
- On 22 July 2022, Fenix confirmed that it had completed the acquisition of the remaining 50% interest in haulage
joint venture company, Fenix-Newhaul Pty Ltd (Fenix-Newhaul) resulting in the consolidation of 100% ownership of
the haulage business. In accordance with the Share Sale Agreement the Company has paid Newhaul $7.5 million in
cash and 30,000,000 Fenix fully paid ordinary shares. In addition, Mr Craig Mitchell, has been nominated to join the
Board of Fenix, with his appointment as a director to be effective on and from 1 September 2022;
- On 25 July 2022, Mr Robert Brierley tendered his resignation from the position of Managing Director. The Board of
Fenix have accepted Mr Brierley’s resignation on the basis he will continue in his current role for a period of up to
three months to assist the Company in an orderly leadership transition; and
- Management have not completed an assessment of the acquisition accounting for Fenix- Newhaul at the timing of
signing the Directors Declaration.
No other material matters have occurred subsequent to the end of the year which requires reporting on other than those
which have been noted above or reported to ASX.
Other than as set out above there has not arisen in the interval between the end of the period and the date of this report
any item, transaction or event of a material and unusual nature likely, in the opinion of the Directors of the Company to
affect substantially the operations of the Company, the results of those operations or the state of affairs of the Company
in subsequent financial years.
31 RECONCILATION OF PROFIT AFTER INCOME TAX TO NET CASH INFLOW FROM OPERATING ACTIVITIES
Profit for the period
Add/(less) non-cash items:
Depreciation and amortisation
Performance rights expense – Directors and Employees
Options expense – Employee share loan
Inventory movement
Foreign exchange
Add/(less) items classified as invested/financing activities:
Finance costs
Interest income
Share issue costs claimed as a deduction
Profit from joint venture
Changes in assets and liabilities during the financial year:
Increase/(decrease) in receivables
(Decrease)/increase in payables
Increase in employee provision
Increase in taxation provision
Notes
2022
$
2021
$
50,694,454
49,040,926
13
20b
20c
7
5
8
15
6,017,953
-
59,182
1,932,245
14,646
-
5,716,151
(15,003,135)
140,416
148,261
842,464
(225,503)
(83,378)
(4,776,607)
96,728
(104,118)
267,142
(919,687)
76,026
(216,317)
(4,003,070)
17,391,702
110,486
7,717,417
103,992
12,547,879
Net cash inflow used in operating activities
62,285,991
65,300,264
FENIX RESOURCES LIMITED
- 58 -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
32 REMUNERATION OF AUDITORS
During the year, the following fees were paid or payable for services provided by the auditor of the parent entity, its
related parties and non-related audit firms:
Audit and assurance services
Grant Thornton Audit Pty Ltd
Audit and review of financial statements
128,603
87,466
2022
$
2021
$
Other services
Grant Thornton Australia Limited
Due diligence services
Total remuneration
47,000
175,603
-
87,466
From time to time the Consolidated Entity may decide to employ an external auditor on assignments additional to their
statutory audit duties where the auditor’s expertise and experience with the Consolidated Entity are important. These
assignments are principally tax advice and due diligence on acquisitions, which are awarded on a competitive basis. It is
the Group’s policy to seek competitive tenders for all major consulting projects.
33
PARENT ENTITY INFORMATION
The following information relates to the parent entity,
Fenix Resources Limited as at 30 June 2022. The
information presented here has been prepared using
consistent accounting policies as presented in Note 34.
(a) Summary of financial information
The individual aggregate financial information for the
parent entity is shown in the table.
(b) Guarantees entered into by the parent entity
The parent entity did not have any guarantees as at
30 June 2022 or 30 June 2021.
(c) Contingent liabilities of the parent entity
The parent entity did not have any contingent liabilities
as at 30 June 2022 or 30 June 2021.
(d) Contractual commitments for the acquisition of
property, plant and equipment
The parent entity did not have any contractual
commitments for the acquisition of property, plant and
equipment as at 30 June 2022 or 30 June 2021.
Company
2022
$
2021
$
Financial position
Current assets
118,325,097
88,844,933
Total assets
150,518,318
114,152,265
Current liabilities
35,917,424
29,312,516
Total liabilities
42,832,614
36,890,036
Equity
Issued capital
52,166,431
49,831,949
Reserves
2,759,182
1,297,484
Retained Earnings
52,760,091
26,132,796
Total equity
107,685,704
77,262,229
Financial performance
Profit for the year
51,418,518
49,040,926
Total comprehensive
loss
51,418,518
49,040,926
FENIX RESOURCES LIMITED
- 59 -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
34 STATEMENT OF SIGNIFICANT ACCOUNTING POLICES
New standards and interpretations not yet adopted
Fenix Resources Limited (Company or Fenix) is a company
incorporated in Australia whose shares are publicly traded on the
Australian Securities Exchange. Fenix Resources Limited is the
ultimate parent entity of the Group.
The consolidated financial statements of Fenix Resources Limited
for the year ended 30 June 2022 comprise the Company and its
controlled subsidiaries (together referred to as the Group and
individually as Group entities).
Statement of compliance
These general-purpose financial statements have been prepared
in accordance with Australian Accounting Standards, other
authoritative pronouncements of the Australian Accounting
Standards Board, Australian Accounting Group Interpretations
and the Corporations Act 2001. Fenix Resources Limited is a for-
profit entity for the purpose of preparing the financial
statements.
The consolidated financial statements of the Group also comply
with International Financial Reporting Standards (IFRS) as issued
by the International Accounting Standards Board (IASB).
Historical cost convention
These financial statements have been prepared on an accruals
basis and are based on historical costs and do not take into
account changing money values or, except where stated, current
valuations of non-current assets. Cost is based on the fair values
of the consideration given in exchange for assets.
Critical accounting estimates and significant judgements
critical accounting estimates.
The preparation of financial statements requires the use of
requires
certain
Management to exercise its judgment in the process of applying
the Group's accounting policies. The areas involving a higher
degree of judgment or complexity, or areas where assumptions
and estimates are significant to the financial statements are
disclosed within Note 25.
It also
New and amended standards adopted by the Group
The Group has adopted all of the new and revised Standards and
Interpretations issued by the AASB that are relevant to their
operations and effective for the current annual reporting period.
IFRIC has published two agenda decisions clarifying how
arrangements in respect of a specific part of cloud technology,
Software-as-a-Service (SaaS), should be accounted for. The
Company has taken the guidance for cloud computing into
account for the year ended 30 June 2022 with no significant
impact on the current or prior periods
The adoption of all the new and revised Standards and
Interpretations has not resulted in any changes to the Group’s
accounting policies and has no effect on the amounts reported
for the current or prior years.
Certain new accounting standards and interpretations have been
published that are not mandatory for 30 June 2022 reporting
periods and have not been early adopted by the group. The
group's assessment of the impact of these new standards and
interpretations is set out below. These standards are not
expected to have a material impact on the entity in the current
or
future
transactions.
future reporting periods and on
foreseeable
There are no other standards that are not yet effective and that
are expected to have a material impact on the Group in the
current or future reporting period and in the foreseeable future.
Accounting Policies
In order to assist in the understanding of the financial statements,
the following summary explains the principle accounting policies
that have been adopted in the preparation of the financial report.
These policies have been applied consistently to all of the periods
presented, unless otherwise stated.
(a) Principles of Consolidation
Subsidiaries
The consolidated financial statements incorporate the assets and
liabilities of subsidiaries of the Company at the end of the
reporting period. Subsidiaries are all those entities (including
special purpose entities) over which the Group has the power to
financial and operating policies, generally
govern
accompanying a shareholding of more than one-half of the voting
rights. The existence and effect of potential voting rights that are
currently exercisable or convertible are considered when
assessing whether the Group controls another entity.
the
Subsidiaries are fully consolidated from the date on which control
is transferred to the Group. They are de-consolidated from the
date that control ceases. Where a subsidiary has entered or left
the Group during the year, the financial performance of those
entities is included only for the period of the year that they were
controlled. A list of subsidiaries is contained in Note 28 to the
financial statements.
Intercompany transactions, balances and unrealised gains on
transactions between Group companies are eliminated in full on
consolidation. Unrealised losses are also eliminated unless the
transaction provides evidence of the impairment of the asset
transferred.
Non-controlling interests in the results and equity of subsidiaries
are shown separately in the consolidated statement of profit or
loss and other comprehensive income, consolidated statement of
changes in equity and consolidated statement of financial
position.
Accounting policies of subsidiaries have been changed where
necessary to ensure consistency with the policies adopted by the
Group.
FENIX RESOURCES LIMITED
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
Equity method
(b) Segment Reporting
Under the equity method of accounting, the investments are
initially recognised at cost and adjusted thereafter to recognise
the Group’s share of the post-acquisition profits or losses of the
investee in profit or loss, and the Group’s share of movements in
other comprehensive
in other
comprehensive income. Dividends received or receivable from
associates and joint ventures are recognised as a reduction in the
carrying amount of the investment.
income of the
investee
When the Group’s share of losses in an equity-accounted
investment equals or exceeds its interest in the entity, including
any other unsecured long-term receivables, the Group does not
recognise further losses, unless it has incurred obligations or
made payments on behalf of the other entity.
Unrealised gains on transactions between the Group and its
associates and joint ventures are eliminated to the extent of the
Group’s interest in these entities. Unrealised losses are also
eliminated unless the transaction provides evidence of an
impairment of the asset transferred. Accounting policies of equity
accounted investees have been changed where necessary to
ensure consistency with the policies adopted by the Group.
The carrying amount of equity-accounted investments is tested
for impairment in accordance with the policy described in Note
34(i).
Changes in ownership interests
The Group treats transactions with non-controlling interests that
do not result in a loss of control as transactions with equity
owners of the Group. A change in ownership interest results in an
adjustment between the carrying amounts of the controlling and
non-controlling interests to reflect their relative interests in the
subsidiary. Any difference between the amount of the
adjustment to non-controlling interests and any consideration
paid or received is recognised in a separate reserve within equity
attributable to owners of Fenix Resources Limited.
When the Group ceases to consolidate or equity account for an
investment because of a loss of control, joint control or significant
influence, any retained interest in the entity is remeasured to its
fair value with the change in carrying amount recognised in profit
or loss. This fair value becomes the initial carrying amount for the
purposes of subsequently accounting for the retained interest as
an associate, joint venture or financial asset. In addition, any
amounts previously recognised in other comprehensive income
in respect of that entity are accounted for as if the Group had
directly disposed of the related assets or liabilities. This may
in other
amounts previously
mean
comprehensive income are reclassified to profit or loss.
recognised
that
If the ownership interest in a joint venture or an associate is
reduced but joint control or significant influence is retained, only
a proportionate share of the amounts previously recognised in
other comprehensive income are reclassified to profit or loss
where appropriate.
Operating segments are reported in a manner that is consistent
with the internal reporting to the chief operating decision
maker, which has been identified by the Company as the Board.
(c)
Foreign Currency Translation
Functional and presentation currency
Items included in the financial statements of the Group are
measured using the currency of the primary economic
environment in which the Group operates (‘the functional
currency). The consolidated financial statements are presented in
Australian dollars, which is Fenix Resources Limited’s functional
and presentation currency.
Transactions and balances
Foreign currency transactions are translated into functional
currency using the exchange rates prevailing at the dates of the
transactions. Foreign currency monetary assets and liabilities at
the reporting date are translated at the exchange rate existing at
reporting date. Exchange differences are recognised in profit or
loss in the period in which they arise.
Group companies
The results and financial position of foreign operations (none of
which has the currency of a hyperinflationary economy) that have
a functional currency different from the presentation currency
are translated into the presentation currency as follows:
assets and liabilities for each statement of financial position
presented are translated at the closing rate at the date of that
balance sheet;
income and expenses for each statement of profit or loss and
other comprehensive income are translated at average exchange
rates (unless this is not a reasonable approximation of the
cumulative effect of the rates prevailing on the transaction dates,
in which case income and expenses are translated at the dates of
the transactions); and
all resulting exchange differences are recognised in other
comprehensive income.
On consolidation, exchange differences arising from the
translation of any net investment in foreign entities, and of
borrowings and other financial instruments designated as hedges
of such investments, are recognised in other comprehensive
income. When a foreign operation is sold or any borrowings
forming part of the net investment are repaid, a proportionate
share of such exchange difference is reclassified to profit or loss,
as part of the gain or loss on sale where applicable.
Goodwill and fair value adjustments arising on the acquisition of
a foreign operation are treated as assets and liabilities of the
foreign operation and translated at the closing rate.
FENIX RESOURCES LIMITED
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
(d) Revenue Recognition
Revenue is measured as the fair value of the consideration
received or receivable. The Group recognises revenue when the
amount of revenue can be reliably measured it is probable that
future economic benefits will flow to the entity.
Revenue for other business activities is recognised on the
following basis:
Iron Ore Sales
The Group generates revenue from the sale of iron ore. Revenue
is recognised at a point in time when control of the promised
goods or services passes to the customer. In most instances,
control passes when the goods are delivered to a destination
specified by the customer, typically on board the customer's
appointed vessel. The amount of revenue recognised reflects the
consideration to which the Group expects to be entitled in
exchange for the goods.
Where the Group's sales invoices are provisionally priced at the
date of shipment, a subsequent final invoice, which is typically
once the vessel has arrived at its destination, is issued and
adjustments arise as a consequence of changes in moisture or ore
quality.
Interest income
Interest revenue is recognised on a time proportionate basis that
takes into account the effective yield on the financial asset.
(e)
Inventories
Ore stockpiles are physically measured or estimated and valued
at the lower of cost and net realisable value. Cost is determined
on a weighted average basis and comprises mining costs, direct
labour, haulage, depreciation and an
materials, direct
appropriate proportion of project overhead expenditure, the
latter being allocated on the basis of normal operating capacity.
Net realisable value is the estimated selling price in the ordinary
course of business, less estimated costs of completion and
estimated costs necessary to make the sale.
(f)
Income Tax and Other Taxes
The income tax expense or revenue for the period is the tax
payable on the current period’s taxable income based on the
applicable income tax rate for each jurisdiction adjusted by
changes in deferred tax assets and liabilities attributable to
temporary differences and to unused tax losses.
The current income tax charge is calculated on the basis of the
tax laws enacted or substantively enacted at the end of the
reporting period
in the countries where the company’s
subsidiaries and associates operate and generate taxable income.
Management periodically evaluates positions taken in tax returns
with respect to situations in which applicable tax regulation is
subject to
It establishes provision where
appropriate on the basis of amounts expected to be paid to the
tax authorities.
interpretation.
Deferred income tax is provided in full, using the liability method,
on temporary differences arising between the tax bases of assets
and liabilities and their carrying amounts in the consolidated
financial statements. However, deferred tax liabilities are not
recognised if they arise from the initial recognition of goodwill.
Deferred income tax is also not accounted for if it arises from
initial recognition of an asset or liability in a transaction other
than a business combination that at the time of the transaction
affects neither accounting nor taxable profit or loss. Deferred
income tax is determined using tax rates (and laws) that have
been enacted or substantially enacted by the end of the reporting
period and are expected to apply when the related deferred
income tax asset is realised or the deferred income tax liability is
settled.
Deferred tax assets are recognised for deductible temporary
differences and unused tax losses only if it is probable that future
taxable amounts will be available to utilise those temporary
differences and losses.
Deferred tax liabilities and assets are not recognised for
temporary differences between the carrying amount and tax
bases of investments in foreign operations where the company is
able to control the timing of the reversal of the temporary
differences and it is probable that the differences will not reverse
in the foreseeable future.
Deferred tax assets and liabilities are offset when there is a legally
enforceable right to offset current tax assets and liabilities and
when the deferred tax balances relate to the same taxation
authority. Current tax assets and tax liabilities are offset where
the entity has a legally enforceable right to offset and intends
either to settle on a net basis, or to realise the asset and settle
the liability simultaneously.
Fenix Resources Limited and
its wholly owned Australian
controlled entities have implemented the tax consolidation
legislation. As a consequence, these entities are taxed as a single
entity and the deferred tax assets and liabilities of these entities
are set off in the consolidated financial statements.
it relates to
Current and deferred tax is recognised in profit or loss, except to
in other
the extent that
comprehensive income or directly in equity. In this case, the tax
is also recognised in other comprehensive income or directly in
equity, respectively.
items recognised
(g) Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount
of GST except:
- where the GST incurred on a purchase of goods and
services is not recoverable from the taxation authority, in
which case the GST is recognised as part of the cost of
acquisition of the asset or as part of the expense item as
applicable; and
-
receivables and payables are stated with the amount of GST
included.
FENIX RESOURCES LIMITED
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
The net amount of GST recoverable from, or payable to, the
taxation authority is included as part of receivables or payables
in the Statement of Financial Position.
Cash flows are included in the Statement of Cash Flows on a gross
basis and the GST component of cash flow arising from investing
and financing activities, which is recoverable from, or payable to,
the taxation authority are classified as operating cash flows.
Commitments and contingencies are disclosed net of the amount
of GST recoverable from, or payable to, the taxation authority.
(h) Exploration and Evaluation Expenditure
The Group’s policy with respect to exploration and evaluation
expenditure is to use the area of interest method.
This method allows the costs associated with the acquisition,
exploration, and evaluation of a prospect to be aggregated on the
consolidated statement of financial position and matched against
the benefits derived from commercial production once this
commences.
Costs
Exploration
lease acquisition costs relating to exploration
provinces are initially capitalised and then amortised over the
shorter term of the lease or the expected life of the project.
All other exploration and evaluation costs, including general
permit activity, geological and geophysical costs and new venture
activity costs are charged as expenses as incurred except where:
-
-
such evaluation costs are expected to be recouped through
successful development and exploitation of the area of
interest or alternatively, by its sale; or
exploration and/or evaluation activities in the area of
interest have not yet reached a stage which permits a
reasonable assessment of the existence or otherwise of
economically
reserves and active and
significant operations in relation to the area are continuing.
recoverable
Areas of interest are recognised at permit level. Subsequent to
the recognition of an area of interest, all further costs relating to
the Area of Interest are initially capitalised. Each area of interest
is reviewed at least bi-annually to determine whether economic
quantities of reserves exist or whether further exploration and
evaluation work is required to support the continued carry
forward of capitalised costs. To the extent it is considered that
the relevant expenditure will not be recovered, it is written off.
In the statement of cash flows, those cash flows associated with
the capitalised exploration and evaluation expenditure are
classified as cash flows used in investing activities exploration and
evaluation expenditure expensed is classified as cash flows used
in operating activities.
Future restoration costs
The Group’s aim is to avoid or minimise environmental impacts
resulting from its operations and reviews work scope and cost
estimates for restoration annually.
Provision is made in the consolidated statement of financial
position for the estimated costs of legal and constructive
obligations to restore operating locations in the period in which
the obligation arises. The estimated costs are capitalised as part
of the cost of the related project where recognition occurs in the
operating locations. The costs are then recognised as an expense
on a units of production basis during the production phase of the
project.
(i)
Impairment of Assets
The Group assesses at each reporting date whether there is an
indication that an asset may be impaired. If any such indication
exists, or when annual impairment testing for an asset is
required, the Group makes an estimate of the asset’s recoverable
amount. An asset’s recoverable amount is the higher of its fair
value less costs to sell and its value in use and is determined for
an individual asset, unless the asset does not generate cash
inflows that are largely independent of those from other assets
or groups of assets and the asset’s values in use cannot be
estimated to be close to its fair value. In such cases the asset is
tested for impairment as part of the cash generating unit to which
it belongs.
When the carrying amount of an asset or cash-generating unit
exceeds its recoverable amount, the asset or cash-generating
unit is considered impaired and is written down to its recoverable
amount. 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.
Impairment
losses relating to continuing operations are
recognised in those expense categories consistent with the
function of the impaired asset unless the asset is carried at re-
valued amount (in which case the impairment loss is treated as a
revaluation decrease).
As assessment is also made at each reporting date as to whether
there is any indication that previously recognised impairment
losses may no longer exist or may have decreased. If such
indication exists, the recoverable amount is estimated. A
previously recognised impairment loss is reversed only if there
has been a change in the estimates used to determine the asset’s
recoverable amount since the
loss was
recognised. If that is the case the carrying amount of the asset is
increased to its recoverable amount. That increased amount
cannot exceed the carrying amount that would have been
determined, net of depreciation, had the impairment loss been
recognised for the asset in prior years. Such reversal is
recognised in profit or loss unless the asset is carried at the re-
valued amount, in which case the reversal is treated as a
revaluation increase. After such a reversal the depreciation
impairment
last
FENIX RESOURCES LIMITED
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
charge is adjusted in future periods to allocate the asset’s revised
carrying amount, less any residual value, on a systematic basis
over its remaining useful life.
(m) Mine Properties, Property Plant And Equipment
Recognition and measurement
(j)
Cash and Cash Equivalents
For the purposes of the statement of cash flows, cash and cash
equivalents includes cash on hand, cash in bank accounts, money
market investments readily convertible to cash within two
working days, and bank bills but net of outstanding bank
overdrafts.
(k) Trade and Other Receivables
Receivables are initially recognised at the transaction price, less
allowances for expected credit loss.
(l)
Investments and Other Financial Assets
Investments and other financial assets
Classification
The Group classifies
measurement categories:
its financial assets
in the following
-
those to be measured subsequently at fair value (either
through OCI, or through profit or loss), and
-
those to be measured at amortised cost.
The classification depends on the entity's business model for
managing the financial assets and the contractual terms of the
cash flows.
For assets measured at fair value, gains and losses will either be
recorded in profit or loss or OCI. For investments in equity
instruments that are not held for trading, this will depend on
whether the group has made an irrevocable election at the time
of initial recognition to account for the equity investment at fair
value through other comprehensive income (FVOCI). The group
reclassifies debt investments when and only when its business
model for managing those assets changes.
Measurement
At initial recognition, the group measures a financial asset at its
fair value plus, in the case of a financial asset not at fair value
through profit or loss (FVPL), transaction costs that are directly
attributable to the acquisition of the financial asset. Transaction
costs of financial assets carried at FVPL are expensed in profit or
loss.
Impairment
The Group assesses on a forward-looking basis the expected
credit losses associated with its debt instruments carried at
amortised cost and FVOCI. The impairment methodology applied
depends on whether there has been a significant increase in
credit risk.
For trade receivables, the Group applies the simplified approach
permitted by AASB 9, which requires expected lifetime losses to
be recognised from initial recognition of the receivables.
Mine properties, property, plant and equipment is stated at cost
and
less
accumulated impairment losses.
accumulated depreciation
amortisation
and
Items of mine properties, property, plant and equipment are
initially recognised at cost at the date of acquisition when it is
probable that future economic benefits associated with the asset
will flow to the Group and the cost of the item can be reliably
measured. Cost includes expenditure that is directly attributable
to the acquisition of the items. Subsequent costs are included in
the asset's carrying amount or recognised as a separate asset, as
appropriate, only where it is probable that future economic
benefits will flow to the Group and the cost of the item can be
measured reliably.
The assets' residual value and useful lives are reviewed, and
adjusted if appropriate, at the end of each reporting period. An
asset's carrying amount is immediately written down to its
recoverable amount if the asset's carrying amount is greater than
its estimated recoverable amount.
Gains and losses on disposals are determined by comparing
proceeds with the carrying amount and are recognised in profit
or loss.
Mine properties under development
Mine properties under development represents the costs
incurred in preparing mines for production and includes plant and
equipment under construction and operating costs incurred
before production commences.
Once production commences, these costs are transferred to
property, plant and equipment and mine properties as
appropriate, and are depreciated and amortised using the units
of production method based on the estimated economically
recoverable resource contained in the mine plan to be extracted
to which they relate or are written off if the mine property is
abandoned.
Mine properties
Mine properties represent the accumulation of all pre-
production expenditure incurred in relation to areas of interest
for which the technical feasibility and commercial viability of the
extraction of mineral resources are demonstrable.
Production is deemed to commence when the mine assets are
installed and ready for use in the location and condition
necessary for them to be capable of operating in the manner
intended by management. These costs are capitalised to the
extent they are expected to be recouped through the successful
exploitation of the related mining leases.
Mine properties include:
- Capitalised expenditure
in
relation
to exploration,
FENIX RESOURCES LIMITED
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
evaluation, feasibility, and acquisition costs incurred on
projects for which the technical feasibility and commercial
viability of extracting a mineral resource are demonstrable.
- The cost of rehabilitation and mine closure relating to
assets reflected in mine properties.
Where the useful life of an asset is directly linked to the
extraction of ore from a mine, the asset is depreciated using the
units of production method. The units of production method
results in depreciation and amortisation charges proportional to
the depletion of the estimated ore reserve of the mine. The unit
of account used in the calculation is tonnes of ore.
- Capitalised development and production stripping costs.
(n) Plant and Equipment
- Pre-production operating costs, net of pre-production
revenue, previously accumulated and carried forward in
mine properties under development, transferred to mine
properties in relation to areas of interest in which mining
has now commenced.
- Associated mine infrastructure including access roads,
evaporation ponds, tailings facility and the airstrip.
- Mining contractor mobilisation costs.
Mine properties are amortised on a units of production basis over
the economically recoverable ore reserve contained in the
relevant mine plan.
When further development expenditure is incurred in respect of
a mine property after the commencement of production, such
expenditure is carried forward as part of the mine property only
when it is probable that the additional future economic benefits
associated with the expenditure will flow to the Group.
Otherwise, such expenditure is classified as part of the cost of
production.
Right-of-use assets
Right-of-use (ROU) assets, representing the Group's right to use
an underlying leased asset for the lease term, are measured at
cost, less any accumulated depreciation and impairment losses,
and adjusted for any remeasurement of lease liabilities.
Depreciation and amortisation
Depreciation commences when an asset is in the location and
condition necessary for it to be capable of operating in the
manner intended by management. Depreciation of assets is
calculated using either the straight-line method or units of
production method to allocate the assets' cost, net of residual
values, over the estimated useful lives of the assets.
Mine-related plant and equipment is depreciated on a units of
production basis, except for assets with a useful life less than the
life of mine, for which the straight-line method is applied. Non-
mine-related plant and equipment is depreciated on a straight-
line basis. The depreciation rates used when applying the
straight-line method vary between 5% to 50% per annum.
Mine properties are amortised on a units of production basis over
the life of the estimated ore reserve of the mine.
Units of production method
Plant and equipment is stated at historical cost less accumulated
depreciation and any impairment in value. Historical cost includes
expenditure that is directly attributable to the acquisition of the
items.
Subsequent costs are included in the asset’s carrying amount or
recognised as a separate asset, as appropriate, only when it is
probable that future economic benefits associated with the item
will flow to the Group and the cost of the item can be measured
reliably. The carrying amount of any component accounted for as
a separate asset is derecognised when replaced.
Depreciation is calculated using both the diminishing value and
straight-line methods to allocate their cost or revalued amounts,
net of their residual values, over their estimated useful lives:
-
-
Office equipment 2 - 20 years
Field Equipment 3 - 20 years
The assets’ residual values and useful lives are reviewed, and
adjusted if appropriate, at the end of each reporting period.
An asset’s carrying amount is written down immediately to its
recoverable amount if the asset’s carrying amount is greater than
its estimated recoverable amount.
Gains and losses on disposals are determined by comparing
proceeds with carrying amount. These are included in profit or
loss.
(o)
Leases
Lease assessment
Applying the definition of a lease
At inception of a contract, the Group assesses whether a contract
is, or contains, a lease, by determining whether the contract
conveys the right to control the use of an identified asset for a
period of time in exchange for consideration.
Control is considered to exist if the Group has the right to obtain
substantially all of the economic benefits from the use of an
explicitly or implicitly identified asset over which the supplier
does not have a substantive substitution right, and the right to
direct the use of that asset throughout the period of use.
Lease term
The lease term is the non-cancellable term of the lease and any
periods covered by:
- an extension option, if that option is reasonably certain to
be exercised, and;
FENIX RESOURCES LIMITED
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
- a termination option, if that option is reasonably certain
not to be exercised.
Non-lease components
At inception or on reassessment of a contract that contains a
lease component, the consideration in the contract is allocated
to each lease component on the basis of their relative stand-
alone prices, unless an election is made to account for the lease
and non-lease components as a single lease component.
Non-lease components are excluded from future lease payments
and recognised separately as incurred as operating expenses on
a straight-line basis in profit or loss.
Initial recognition
Leases are recognised as an ROU asset and a corresponding lease
liability at the commencement date, which is the date the leased
asset is available for use by the Group.
Short-term leases and leases of low-value assets
All leases are accounted for by recognising an ROU asset and a
lease liability except for:
-
short-term leases (defined as leases with a lease term of 12
months or less and which do not contain a purchase option)
and;
-
leases of low-value assets.
Lease payments on short-term leases and leases of low-value
assets are recognised as incurred as operating expenses on a
straight-line basis over the lease term in profit or loss.
Lease liabilities
Initial measurement
Lease liabilities are initially measured at the present value of
lease payments to be paid after the commencement date over
the lease term, discounted using the lessee’s incremental
borrowing rate, if the interest rate implicit in the lease cannot be
readily determined.
The lessee’s incremental borrowing rate (IBR) is the rate the
Group would have to pay to borrow the funds necessary to obtain
an asset of similar value in a similar economic environment with
similar terms and conditions. To determine the IBR, the Group
obtains external interest rate advice and adjusts the interest
rates to reflect the lease conditions and the underlying asset.
Lease payments included in the measurement of the lease
liabilities comprise:
-
-
fixed payments, including in-substance fixed payments, less
any lease incentives receivable;
variable lease payments that depend on an index or rate,
initially measured using the
index or rate at the
commencement date;
- amounts payable under residual value guarantees; and
- payments arising from purchase, extension, or termination
options reasonably certain to be exercised by the Group.
Variable lease payments not dependent on an index or a rate, for
example, variable lease payments linked to the use of an
underlying asset, are not included in the measurement of lease
liabilities, and are recognised as operating expenses in profit or
loss as incurred.
Subsequent measurement
The lease liability is subsequently measured on an amortised cost
basis using the effective interest method, where the lease liability
is increased to reflect the accretion of interest and reduced by
the lease payments made, over the lease term.
Interest expense is recognised as interest expense on lease
liabilities in profit or loss over the lease term, on the remaining
lease liability balance for each period.
Remeasurement
Lease liabilities are remeasured if:
-
-
there is a lease modification that is not accounted for as a
separate lease; or
there are changes in: the lease term; the assessment to
exercise a purchase option; amounts payable under a
residual guarantee; in-substance fixed payments; or future
lease payments arising from a change in an index or rate.
A revised discount rate is applied when there is a change in the
assessment to exercise a purchase option, the lease term or
floating interest rates. A corresponding adjustment is recognised
in the ROU asset, or in profit or loss if the carrying amount of the
ROU asset has been reduced to nil.
ROU assets
ROU assets, representing the Group’s right to use the underlying
leased asset for the lease term, are measured at cost, less any
accumulated depreciation and impairment losses, and adjusted
for any remeasurement of lease liabilities.
Initial measurement
The initial cost of ROU assets includes:
-
-
-
-
the initial measurement of the related lease liabilities
recognised;
any lease payments made on or before the commencement
date, less any lease incentives received;
initial direct costs incurred; and
restoration cost estimates, recognised and measured
applying AASB 137 Provisions, Contingent Liabilities and
Contingent Assets.
Subsequent measurement
ROU assets are subsequently depreciated, in accordance with the
Group's existing depreciation accounting policy, over the shorter
of the estimated useful life of the underlying asset and the lease
FENIX RESOURCES LIMITED
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
term. If it is reasonably certain that the Group will either obtain
ownership of the underlying asset by the end of the lease term or
exercise a purchase option, the ROU asset is depreciated over its
estimated useful life.
instruments vest than were originally anticipated to do so. Any
equity instrument subject to a market condition is valued as if it
will vest irrespective of whether or not that market condition is
fulfilled, provided that all other conditions are satisfied.
ROU assets are assessed for any impairment in accordance with
the Group's existing impairment accounting policy.
(p) Acquisition of Assets
Where an entity or operation is acquired, the identifiable assets
acquired (and, where applicable, identifiable liabilities assumed)
are to be measured at the acquisition date at their relative fair
values of the purchase consideration.
Where the acquisition is a group of assets or net assets, the cost
of acquisition will be apportioned to the individual assets
acquired (and, where applicable, liabilities assumed). Where a
group of assets acquired does not form an entity or operation,
the cost of acquisition is apportioned to each asset in proportion
to the fair values of the assets as at the acquisition date.
(q) Share-Based Payment Transactions
Benefits to Employees and consultants (including Directors)
The Group provides benefits to employees and consultants
(including Directors) of the Group in the form of share-based
payment transactions, whereby employees render services in
exchange for shares or rights over shares or options (“equity-
settled transactions”).
The costs of these equity settled transactions are measured by
reference to the fair value of the equity instruments at the date
on which they are granted. The fair value of performance rights
granted is determined using the single barrier share option
pricing model. The fair value of options granted is determined by
using the Black-Scholes option pricing technique. Further details
of options and performance rights granted are disclosed in Note
22.
The cost of these equity-settled transactions is recognised,
together with a corresponding increase in equity, over the period
in which the performance and/or service conditions are fulfilled
(the vesting period).
At each subsequent reporting date until vesting, the cumulative
charge to the profit or loss is the product of: (i) the fair value at
grant date of the award; (ii) the current best estimate of the
number of equity instruments that will vest, taking into account
such factors as the likelihood of employee turnover during the
vesting period and the likelihood of non-market performance
conditions being met; and (iii) the expired portion of the vesting
period.
The charge to the profit or loss for the period is the cumulative
amount as calculated above less the amounts already charged in
previous periods. There is a corresponding credit to equity.
Until an equity instrument has vested, any amounts recorded are
contingent and will be adjusted if more or fewer equity
If the terms of an equity-settled award are modified, as a
minimum, an expense is recognised as if the terms had not been
modified. An additional expense
for any
modification that increases the total fair value of the share-based
payment arrangement or is otherwise beneficial to the recipient
of the award, as measured at the date of modification.
is recognised
If an equity-settled transaction is cancelled (other than a grant
cancelled by forfeiture when the vesting conditions are not
satisfied), it is treated as if it had vested on the date of
cancellation, and any expense not yet recognised for the award is
recognised immediately. However, if a new equity instrument is
substituted for the cancelled award and designated as a
replacement award on the date that it is granted, the cancelled
and new equity instrument are treated as if they were a
modification of the original award, as described in the preceding
paragraph.
Benefits to Vendors
The Group provides benefits to vendors of the Group in the form
of share-based payment transactions, whereby the vendor has
render services in exchange for shares or rights over shares or
options (“equity-settled transactions”).
The fair value is measured by reference to the value of the goods
or services received. If these cannot be reliably measured, then
by reference to the fair value of the equity instruments granted.
The cost of these equity-settled transactions is recognised over
the period in which the service was received.
(r) Fair Value Estimation
The fair value of financial assets and financial liabilities must be
estimated for recognition and measurement or for disclosure
purposes.
The carrying value less impairment provision of trade receivables
and payables are assumed to approximately their fair value due
to their short-term nature. The fair value of financial liabilities for
disclosure purposes is estimated by discounting the future
contractual cash flows at the current market interest rate that is
available to the Group for similar financial instruments.
(s)
Provisions
Provisions are recognised when the Group has a present legal or
constructive obligation, it is probable that an outflow of
resources will be required to settle the obligation, and the
amount can be reliably estimated.
Provisions are measured at the present value and the best
estimate of the expenditure required to settle the present
obligation at the end of the reporting period. The discount rate
used to determine the present value is a pre-tax rate that reflects
FENIX RESOURCES LIMITED
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 30 June 2022
Diluted earnings/loss per share
Diluted earnings per share adjusts the figures used
in
determination of basic earnings per share by taking into account
amounts unpaid on ordinary shares and any reduction in earnings
per share that will arise from the exercise of options outstanding
during the year.
(v)
Trade and Other Payables
Trade payables and other payables are carried at amortised cost
and represent liabilities for goods and services provided to the
Group prior to the end of the financial period that are unpaid and
arise when the Group becomes obliged to make future payments
in respect of the purchase of these goods and services. The
amounts are unsecured and usually paid within 30 days of
recognition.
(w) Contributed Equity
Issued and paid up capital is recognised at the fair value of the
consideration received by the Group. Any transaction costs
arising on the issue of ordinary shares are recognised directly in
equity as a reduction of the share proceeds received.
(x) Dividends
The Group adopted a dividend policy in August 2021 that
provides for, to the extent that dividends can be fully franked, a
payment of 50% and 80% of after-tax earnings to shareholders in
the form of dividends, either annually or semi-annually .
(y) Comparatives
Comparative figures have been restated to conform with the
current year’s presentation. This has had no impact on the
financial statements.
(z)
Parent Entity Financial Information
The financial information for the parent entity, Fenix Resources
Limited, disclosed in Note 33 has been prepared on the same
basis as the consolidated financial statements except as set out
below:
Investments in subsidiaries
Investments in subsidiaries are accounted for at cost and subject
to an annual impairment review.
current market assessments of the time value of money and the
risks specific to the liability. The increase in the provision due to
the passage of time is recognised as a finance cost in profit or loss.
Rehabilitation and mine closure
The Group has obligations to dismantle and remove certain items
of mine properties, property, plant and equipment and to restore
and rehabilitate the land on which they sit.
A provision is recognised for the estimated cost of settling the
rehabilitation and restoration obligations existing at the
reporting date, discounted to present value using high quality
corporate bond market yields at the reporting date, that match
the timing of the estimated future cash outflows as closely as
possible.
Where the obligation is related to an item of mine properties,
property, plant and equipment, its cost includes the present
value of the estimated costs of dismantling and removing the
asset and restoring the site on which it is located. The related
rehabilitation asset for the Iron Ridge Project is included in mine
properties.
The discounted value reflects a combination of an assessment of
the nature and extent of the work required, the future cost of
performing the work required, the timing of cash flows and the
discount rate. Over time, the discounted value is increased for the
change in present value based on the discount rates that reflect
current market assessments and the risks specific to the liability.
This increase in the provision, being the periodic unwinding of the
discount due to the passage of time, is recognised as a finance
cost in profit or loss.
The provision is reassessed at least annually. A change in any of
the assumptions used to determine the provisions could have a
material impact on the carrying amount of the provision. Any
change in the provision is reflected as an addition to, or
deduction from, the related rehabilitation asset
in mine
properties and amortised as appropriate.
(t)
Employee Entitlements
The Group’s liability for employee entitlements arising from
services rendered by employees to reporting date is recognised
in other payables. Employee entitlements expected to be settled
within one year together with entitlements arising from wages
and salaries, and annual leave which will be settled within one
year, have been measured at their nominal amount and include
related on-costs.
(u) Profit/loss Per Share
Basic profit/loss per share
Basic earnings per share is determined by dividing the operating
loss attributable to the equity holder of the Group after income
tax by the weighted average number of ordinary shares
outstanding during the financial year.
FENIX RESOURCES LIMITED
- 68 -
DIRECTORS’ DECLARATION
The Directors of the Group declare that:
1.
The financial statements, comprising the consolidated statement of profit or loss and other comprehensive
income, consolidated statement of financial position, consolidated statement of cash flows, consolidated
statement of changes in equity and accompanying notes, are in accordance with the Corporations Act 2001 and:
(a)
(b)
comply with Accounting Standards, the Corporations Regulations 2001 and other mandatory professional
reporting requirements; and
give a true and fair view of the financial position as at 30 June 2022 and of the performance for the year
ended on that date of the consolidated entity.
In the Directors’ opinion, there are reasonable grounds to believe that the Group will be able to pay its debts as
and when they become due and payable.
The Group has included in the notes to the financial statements and explicit an unreserved statement of
compliance with International Financial Reporting Standards.
The Directors have been given the declarations by the chief executive officer and chief financial officer required
by section 295A.
2.
3.
4.
This declaration is made in accordance with a resolution of the Board of Directors and is signed for and on behalf of the
Directors by:
John Welborn
Non-Executive Chairman
Perth
29 August 2022
FENIX RESOURCES LIMITED
- 69 -
Grant Thornton Audit Pty Ltd
Level 43 Central Park
152-158 St Georges Terrace
Perth WA 6000
PO Box 7757
Cloisters Square
Perth WA 6850
T +61 8 9480 2000
Independent Auditor’s Report
To the Members of Fenix Resources Limited
Report on the audit of the financial report
Opinion
We have audited the financial report of Fenix Resources Limited (the Company) and its subsidiaries (the
Group), which comprises the consolidated statement of financial position as at 30 June 2022, the
consolidated statement of profit or loss and other comprehensive income, consolidated statement of
changes in equity and consolidated statement of cash flows for the year then ended, and notes to the
consolidated financial statements, including a summary of significant accounting policies, and the Directors’
declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act
2001, including:
a giving a true and fair view of the Group’s financial position as at 30 June 2022 and of its performance
for the year ended on that date; and
b complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those
standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Report section
of our report. We are independent of the Group in accordance with the auditor independence requirements
of the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical
Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence
Standards) (the Code) that are relevant to our audit of the financial report in Australia. We have also fulfilled
our other ethical responsibilities in accordance with the Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of
the financial report of the current period. These matters were addressed in the context of our audit of the financial
report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these
matters.
www.grantthornton.com.au
ACN-130 913 594
Grant Thornton Audit Pty Ltd ACN 130 913 594 a subsidiary or related entity of Grant Thornton Australia Limited ABN 41 127 556 389 ACN 127 556 389.
‘Grant Thornton’ refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory services to their clients and/or
refers to one or more member firms, as the context requires. Grant Thornton Australia Limited is a member firm of Grant Thornton International Ltd (GTIL).
GTIL and the member firms are not a worldwide partnership. GTIL and each member firm is a separate legal entity. Services are delivered by the member
firms. GTIL does not provide services to clients. GTIL and its member firms are not agents of, and do not obligate one another and are not liable for one
another’s acts or omissions. In the Australian context only, the use of the term ‘Grant Thornton’ may refer to Grant Thornton Australia Limited ABN 41 127
556 389 ACN 127 556 389 and its Australian subsidiaries and related entities. Liability limited by a scheme approved under Professional Standards
Legislation.
Key audit matter
How our audit addressed the key audit matter
Mine properties, property plant and equipment -
Note 13
The Group maintains $13,493,829 of mineral
properties and $11,715,715 of property, plant and
equipment.
In accordance with AASB 136 Impairment of Assets,
the Group assesses internal and external information
to identify whether there is any indication that the
assets may be impaired. Assessing these indicators of
impairment, including reviewing the assets’ residual
value, units of production expected to be obtained from
the asset, and operating results compared to budgeted
forecasts, requires significant management judgement
and estimation, heightening the risk of material
misstatement.
This area is a key audit matter due to the inherent
estimation uncertainty and judgement in assessing
events or circumstances that indicate possible
impairment.
Inventories – Note 7
During the year, the Group continued iron ore
production and, as at 30 June 2022, had iron ore
stockpiles totalling $9,286,984.
Critical to determining the amount and carrying value of
the ore stockpiles are the cost and net realisable value
assumptions adopted by the Group.
The work-in-process volumes and stockpiles are
estimated using industry, engineering, and scientific
data. To determine the net realisable value, the Group
estimates the cost of processing, commodity prices
and timing of sales of the ore produced, among other
estimates and judgements.
This area is a key audit matter due to the inherent
estimation uncertainty and judgements applied by
management to determine the quantity and value of the
inventory.
Our procedures included, amongst others:
• Understanding the capital assets initiation,
capitalisation, amortisation and recognition
processes;
• Agreeing the reconciliation between the capital
assets register and general ledger;
• Sampling and performing tests of details on
significant additions and disposal of assets to
ascertain the accuracy of transactions recorded;
• Performing depreciation reasonableness test to
ascertain the accuracy of expense recorded;
• Reviewing management’s assessment of
impairment indicators in accordance with AASB 136;
• Checking amortisation calculations against
production data and reserve estimates; and
• Assessing adequacy of disclosure in the financial
report
Our procedures included, amongst others:
• Understanding and documenting the inventory
requisition and recognition process, including the
iron ore inventory valuation model;
• Assessing the existence of iron ore inventory on
hand at year-end to an external confirmation
obtained from independent surveyors;
• Assessing the competence, capability and objectivity
of management’s experts used to assist in the
valuation of inventory;
• Reviewing management’s inventory calculation
model for the valuation of iron ore at year-end and
testing management’s assumptions and estimates
used in determining the carrying value;
• Assessing whether inventory is recorded at the
lower of cost and net realisable value; and
• Reviewing the adequacy of disclosure in the
financial report.
Information other than the financial report and auditor’s report thereon
The Directors are responsible for the other information. The other information comprises the information included
in the Group’s annual report for the year ended 30 June 2022, but does not include the financial report and our
auditor’s report thereon.
Our opinion on the financial report does not cover the other information and we do not express any form of
assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information and, in doing
so, consider whether the other information is materially inconsistent with the financial report or our knowledge
obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of the Directors’ for the financial report
The Directors of the Company are responsible for the preparation of the financial report that gives a true and fair
view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal
control as the Directors determine is necessary to enable the preparation of the financial report that gives a true
and fair view and is free from material misstatement, whether due to fraud or error.
In preparing the financial report, the Directors are responsible for assessing the Group’s ability to continue as a
going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of
accounting unless the Directors either intend to liquidate the Group or to cease operations, or have no realistic
alternative but to do so.
Auditor’s responsibilities for the audit of the financial report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from
material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance
with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements
can arise from fraud or error and are considered material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users taken on the basis of this financial report.
A further description of our responsibilities for the audit of the financial report is located at the Auditing and
Assurance Standards Board website at: http://www.auasb.gov.au/auditors_responsibilities/ar1_2020.pdf.This
description forms part of our auditor’s report.
Report on the remuneration report
Opinion on the remuneration report
We have audited the Remuneration Report included in pages 13 to 20 of the Directors’ report for the year
ended 30 June 2022.
In our opinion, the Remuneration Report of Fenix Resources Limited, for the year ended 30 June 2022
complies with section 300A of the Corporations Act 2001.
Responsibilities
The Directors of the Company are responsible for the preparation and presentation of the Remuneration Report
in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the
Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards.
GRANT THORNTON AUDIT PTY LTD
Chartered Accountants
B P Steedman
Partner – Audit & Assurance
Perth, 29 August 2022
ADDITIONAL INFORMATION
Additional information required by the Australian Securities Exchange and shown elsewhere in this report is set out
below. The information is current as at 20 July 2022.
(a)
Distribution of Shareholders
Category (size of holding)
Holders
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 – and over
Total
(b)
Unmarketable Parcels
170
1,594
1,040
2,920
673
6,397
Total Units
64,795
4,924,190
8,556,669
108,513,351
394,154,915
516,213,920
% Issued Share Capital
0.01%
0.95%
1.66%
21.02%
76.36%
100.00%
The number of shareholders holding less than a marketable parcel is 330 as at 20 July 2022 (being 1,694 shares
based on a share price of $0.295 at 20 July 2022).
(c)
Voting Rights
The voting rights attached to each class of equity security are as follows:
Ordinary Shares
Each ordinary share is entitled to one vote when a poll is called, otherwise each member present at a meeting or
by proxy has one vote on a show of hands.
Performance Shares
There are no voting rights attached to any class of performance shares that are on issue.
(d)
20 Largest Shareholders — Ordinary Shares as at 20 July 2022
Rank
Name
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
CITICORP NOMINEES PTY LIMITED
MR JOHN PAUL WELBORN
ROB BRIERLEY
GARRY & DONELLA PLOWRIGHT
BNP PARIBAS NOMS PTY LTD
TITAN ASSETS PTY LTD
MR KENNETH JOSEPH HALL
BNP PARIBAS NOMINEES PTY LTD
KLOSTERS HOLDINGS PTY LTD
MRS RACHEAL JANE OSMAN
PRE-OWNED ROAD TANKERS PTY LTD
ALET INVESTMENTS PTY LTD
MR CAMERON ARMSTRONG & MRS ANN LOUISE ARMSTRONG
SCORPION MINERALS LIMITED
MR CHRISTOPHER JAMES ANDREW HARRIS
CS FOURTH NOMINEES PTY LIMITED
BRISPOT NOMINEES PTY LTD
SHARNEM PTY LTD
MR TIMOTHY NORMAN WILHELM & MRS ANGELA STEPHANIE WILHELM
Ordinary
Shares Held
% of Issued
Capital
23,428,433
15,244,322
12,200,000
12,000,000
11,065,089
9,973,567
7,212,904
6,600,000
6,496,643
6,300,000
5,735,502
5,000,000
4,715,000
4,006,690
4,000,000
3,780,000
3,643,559
3,630,131
3,454,725
3,164,321
4.54%
2.95%
2.36%
2.32%
2.14%
1.93%
1.40%
1.28%
1.26%
1.22%
1.11%
0.97%
0.91%
0.78%
0.77%
0.73%
0.71%
0.70%
0.67%
0.61%
Total of Top 20
Balance of register
Total
29.38%
70.62%
29.38%
70.62%
100.00%
100.00%
FENIX RESOURCES LIMITED
- 73 -
ADDITIONAL INFORMATION
(e)
Substantial Shareholders
As at 20 July 2022, there were no shareholders holding 5% or more of the issued capital of the Company disclosed
in accordance with section 671B of the Corporations Act 2001.
(f)
Unquoted Securities – as at 20 July 2022
Set out below are the classes of unquoted securities currently on issue:
Number
Class
37,500,000
Class C Performance Shares
30,000,000
Class D Performance Shares
(g)
Distribution of holders – Class C Performance Shares
Category (size of holding)
Holders
Total Units
% Issued Share Capital
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 – and over
Total
-
-
-
-
12
12
-
-
-
-
37,500,000
37,500,000
-
-
-
-
100.00%
100.00%
(h)
Distribution of holders – Class D Performance Shares
Category (size of holding)
Holders
Total Units
% Issued Share Capital
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 – and over
Total
-
-
-
-
12
12
-
-
-
-
30,000,000
30,000,000
-
-
-
-
100.00%
100.00%
(i)
Securities Subject to Escrow
As at 20 July 2022 there are no securities currently subject to escrow.
(j)
Unquoted Equity Security Holders with Greater than 20% of an Individual Class
As at 20 July 2022 the following classes of unquoted securities had holders with greater than 20% of that class on
issue:
FENIX RESOURCES LIMITED
- 74 -
ADDITIONAL INFORMATION
Class C Performance Shares
AGNI INTERNATIONAL PTE LTD
RACHEAL OSMAN
GARRY & DONELLA PLOWRIGHT
Class D Performance Shares
AGNI INTERNATIONAL PTE LTD
RACHEAL OSMAN
GARRY & DONELLA PLOWRIGHT
% Interest
20.62%
20.12%
20.12%
20.62%
20.12%
20.12%
(k)
On-market Buy-Back
Currently there is no on-market buy-back of the Company’s securities.
(l)
Corporate Governance
Pursuant to the ASX Listing Rules, the Company’s Corporate Governance Statement will be released in conjunction
with this report. The Company’s Corporate Governance Statement is available on the Company’s website at:
http://fenixresources.com.au/about/corporate-governance/
FENIX RESOURCES LIMITED
- 75 -
Registered Office
Office 10, Emerald House
1202 Hay Street
West Perth WA 6005
T + 61 (0)8 9226 2011
E info@fenixresources.com.au
Share Registry
Automic Pty Ltd
Level 5, 191 St Georges Terrace
ASX:FEX
fenixresources.com.au