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2020 ANNUAL REPORT
MATERIALS FOR AN ENERGY
EFFICIENT FUTURE
Contents
Corporate Directory
2020 Highlights
Chairman’s letter to shareholders
Operations report
Annual Financial Report
Directors’ report
Auditor’s independence declaration
Independent auditor’s report
Director’s declaration
Consolidated statement of profit or loss and
other comprehensive income
Consolidated statement of financial position
Consolidated statement of changes in equity
Consolidated statement of cash flows
Notes to the financial statements
1 General information
2 Significant accounting policies
3 Critical accounting estimates and judgments
4 Segmented information
5 Revenue
6 Expenditure
7
8 Cash and equivalents
9 Trade and receivables
Income tax expense
Lease liability
Issued capital
10 Other assets
11 Property, plant and equipment
12 Right-of-use leased assets
13 Capitalised exploration and evaluation expenditure
14 Trade and other payables
15
16 Provisions
17
18 Reserves
19 Dividends
20 Accumulated loss
21
22 Commitments for expenditure
23 Subsidiaries
24 Notes to the statement of cash flows
25 Share based payments
26 Financial instruments
27 Key management personnel compensation
28 Key management personnel equity holdings
29 Transactions with related parties
29 Parent company information
30 Remuneration of auditors
31 Subsequent events
Loss per share
Additional stock exchange information
DIRECTORS
Anthony Ho
Non-executive Chairman
John Mair
Managing Director
Simon Cato
Non-executive Director
Xiaolei Guo
Non-executive Director
CHIEF FINANCIAL
OFFICER/COMPANY SECRETARY
Miles Guy
REGISTERED AND HEAD OFFICE
Unit 7, 100 Railway Road
Subiaco WA 6008
Greenland
Nuviarissamut B 523
Postboks 156
DK-3921 Narsaq
HOME STOCK EXCHANGE
Australian Securities Exchange, Perth
Code: GGG
AUDITORS
Deloitte Touche Tohmatsu
SHARE REGISTRY
Advanced Share Registry
110 Stirling Highway
Nedlands WA 6009
COMPANY WEBSITE
www.ggg.gl
ABN
85 118 463 004
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2020 HIGHLIGHTS
Rare earth magnet metal prices
rising as demand surges:
EV’s and renewable energy growth
underpins strong outlook
EIA review
process
complete:
project meets
principles of ‘Best
Available Technology’
and ‘Best Available
Practice’
Commencement of public
consultation phase – all
aspects of the project
assessed as meeting
Greenland Guidelines
Project optimisation improves rare
earth recoveries to boost output and
lower costs
European engagement
increasing – strong interest
from European industry
1
GREENLAND MINERALS LIMITED – 2020 ANNUAL REPORT GREENLAND HAS THE OPPORTUNITY
TO BECOME A KEY PLAYER IN THE
SUPPLY OF CRITICAL MATERIALS
FOR GREEN INDUSTRIES TO REDUCE
GLOBAL CARBON EMISSIONS.
2
GREENLAND MINERALS LIMITED – 2020 ANNUAL REPORT Chairman's Letter
Dear Fellow Shareholder,
Notwithstanding a challenging COVID-19 2020 to global economies, our company continued to push ahead
with development of our flagship rare earth project at Kvanefjeld in South Greenland. The strengthening of
our leadership team in Greenland during the year, with the appointment of Jørn Skov Nielsen and use of
video technology have provided seamless mitigations to the impacts of travel restrictions.
Substantial progress was achieved during the year in advancing the Company’s Kvanefjeld project with
the completion of the environmental impact assessment (EIA) and the acceptance of the EIA by the
Greenland government. In December, the Greenland government approved the commencement of the
public consultation process as part of the permitting process. The EIA together with the social impact
assessment and marine safety study were first lodged with the Greenland government to commence the
guidance phase, in late 2015. During this guidance phase the documents have undergone rigorous reviews
by the Greenland government and their appointed independent expert advisors to ensure the reports meet
the requirements of Greenland legislation and the expectations of the Greenland community. The EIA was
the final document to be accepted by the government as meeting these requirements.
The public consultation will provide an opportunity for the Company to present the project to the Greenland
community and stakeholders and to explain the project and its benefits to the present and future citizens
of Greenland.
The global geopolitical shifts during the year have re-focused the world on the importance of reductions of
global carbon emissions. This will continue to drive strong increasing demand for rare earths, particularly in
‘magnet metals’. The drive to a low carbon global economy and specifically to the demand for high-powered
permanent magnets will see demand for magnet metals reach 40% of the total demand for rare earths by
the end of the decade. As a result of increasing demand, the prices of magnet rare earths surged strongly
toward the end of 2020 with this trend continuing into 2021.
During the year, the Company successfully raised $34 million (before costs) through a $30 million
placement to international investors, with a further $4 million raised via a shareholder purchase plan
(SPP). Both placement and SPP were heavily over-subscribed. We welcome the new shareholders to the
Company and thank shareholders for their continuous support.
The Company continued to work closely with Shenghe Resources Holding Co., Ltd on optimisation studies
through 2020. These studies were to increase recoveries, reducing future operating costs and reducing
the environmental impact of the project. The Company also continued and expanded the engagement with
European industry groups, to ensure that production from the Kvanefjeld project is well placed to meet key
European increasing demand.
During 2021, the Company will be into the final stages of the permitting process and working with the
Greenland government to ensure the project meets the Greenland community’s expectations. The
Company will also continue to work with European industrials with a focus on commercial outcomes. Final
engineering design and work programs will also commence with the aim to bring the Kvanefjeld project into
production expeditiously.
In closing, I would like to thank our teams in Australia and Greenland for their dedication and commitment
during what has at times been a difficult year. We also acknowledged the guidance and assistance from
the Greenland government and the tireless support from of our expert consultants.
Yours sincerely
Anthony Ho
Non-executive Chairman
3
GREENLAND MINERALS LIMITED – 2020 ANNUAL REPORT Operations Report
2020 Overview and Review of Operations
Greenland Minerals Limited’s (‘GML or ‘the Company’) focus since 2007 has been
the development of its 100%-owned Kvanefjeld project in Greenland.
Kvanefjeld is one of the world’s most important emerging rare earth projects and is
well positioned to transform GML into a globally significant supplier of materials that
are key to an energy efficient and environmentally sustainable future.
Kvanefjeld is underpinned by a JORC-code compliant resource of >1 billion tonnes,
and an ore reserve estimate of 108 million tonnes to sustain an initial 37-year mine
life. Kvanefjeld offers a new, simpler path to rare earth production than traditional
refractory sources. Recovery of several by-products in addition to neodymium,
praseodymium, terbium and dysprosium during the production of a rare earth
intermediate product rich in critical magnet rare earths will ensure low rare earth
production costs.
GML achieved several important milestones in Kvanefjeld’s development during
2020 which places the Company in a prime position to capitalise on the increase
demand for rare earths and global interest in rare earth projects. The advancement
of the project permitting was a primary focus.
4
GREENLAND MINERALS LIMITED – 2020 ANNUAL REPORT
Kvanefjeld Environmental Impact
Assessment Accepted
In September, Greenland’s Environmental Agency
for Mineral Resource Activities (EAMRA) advised
that the independent scientific review of the
Kvanefjeld Environmental Impact Assessment
(EIA) and supporting studies had concluded, and
the EIA assessed to meet the requirements of the
EIA Guidelines for public consultation.
Acceptance of the Kvanefjeld EIA was a major
2020 milestone, and the culmination of many
years of in-depth studies by a broad cross section
of global independent experts.
Fulfilment of the Guidelines means that all
aspects of the Kvanefjeld Project are based on
international environmental standards and the
principles of ‘Best Available Technology’ and ‘Best
Environmental Practice’. Independent scientific
reviews of the Kvanefjeld EIA were conducted
by the Danish Centre for Environment with
assistance from the Greenland Institute of
Natural Resources.
In its assessment, the EAMRA said it was
very satisfied with the review process which
demonstrated a high degree of mutual flexibility
and cooperation.
Major contributing independent specialists for
the technical aspects of the Kvanefjeld EIA
included Arcadis, Danish Hydraulic Institute, Klohn
Crippen Burger Ltd, Environmental Resources
Management, Orbicon A/S, Danish Technical
University, Wood Group, GHD International, and
SRK Consulting. Specialist consultant Shared
Resources provided important guidance
to the EIA report.
GREENLAND MINERALS LIMITED – 2020 ANNUAL REPORT
5
Operations Report (continued)
Commencement of Kvanefjeld
public consultation
On 17 December 2020, Greenland’s Government
approved the commencement of statutory public
consultation for Kvanefjeld’s Environmental
Impact Assessment (EIA) and the Social Impact
Assessment (SIA), following key application
documents for an exploitation (mining) license
meeting Greenland Guidelines.
This is an important milestone for compliance
with the Greenlandic Government's formal
decision-making process in relation to
granting an exploitation license for Kvanefjeld.
The Greenlandic Minerals Act stipulates EIA
and SIA reports require a public consultation
period. The public consultation started on 18
December 2020 with Greenlandic, Danish,
and English versions of the EIA and the SIA
made available on the Greenland Governments
public hearing portal (https://naalakkersuisut.
gl/en/Hearings/Current-Hearings). Initially
the public consultation process was set for a
12-week period, however in February 2021,
this was extended to a 23-week period due to
COVID-19 travel restrictions and a high degree
of stakeholder interest.
During the public consultation period, GML
is conducting public meetings in towns and
villages in South Greenland. The meetings are
attended by representatives of the Greenlandic
Government and officials from the Ministries
of Mineral Resources and Environment. In
addition, independent scientific experts and
representatives from the Company participate.
At the end of the consultation period, GML
subsidiary Greenland Minerals A/S which holds
the Kvanefjeld licence is required to address
all consultation comments in a White Paper.
Following consultation with the authorities, final
EIA and SIA reports incorporating outcomes
of the public hearing are submitted to the
Mineral Resources Authority. The Greenlandic
Government will then formally process the
application for an exploitation licence for the
Kvanefjeld Project.
Project optimisation
Advanced Flotation Test Work Delivers
Exceptional Performance
GML undertook locked cycle flotation test work
at the BTMR laboratories in China through 2020,
overseen by rare earth specialists Shenghe
Resources Holding Co Ltd.
Locked cycle test work closely represents the
performance of a commercial circuit and builds
on extensive single batch flotation and initial
locked cycle tests which were performed in
2018-19. The results were validated with check
assays at SGS Laboratories in Perth, Australia
and an independent Chinese assay laboratory.
The process development progressed to the
extent where conditions comparable to that of a
commercial plant have been tested.
The latest locked cycle test work completed
multiple cycles of tests using the planned
commercial circuit. Critically, the test included
recycling of process water to determine the
impact of residual reagents in solution on
flotation performance.
This is a significantly closer representation of
the commercial flowsheet than previous test
work and further de-risks the process.
The optimised test work utilised eight full
flowsheet cycles to ensure a steady state was
achieved. Samples were taken over the whole
flowsheet during the eighth cycle to provide a
‘snapshot’ of the circuit performance. The results
demonstrated 87% of the light rare earths and
68% of the heavy rare earths were amassed into
a mineral concentrate, which assayed at a grade
of 23.3% rare earth oxide.
THE RESULTS OF 2020 TEST WORK
CONFIRMED THE OUTSTANDING
PERFORMANCE OF GML’S OPTIMISED
FLOTATION CIRCUIT THAT WILL
CONCENTRATE RE’S INTO A MUCH
SMALLER MASS, ALLOWING FOR A
SMALLER SIMPLER REFINERY CIRCUIT.
6
GREENLAND MINERALS LIMITED – 2020 ANNUAL REPORT
Key Parameters of Locked Cycle
Flotation Circuit:
Rare earth feed grade = 1.5% rare
earth oxide (REO)
Flotation concentrate grade
= 23.3% REO
% Mass reporting to concentrate
= 5.4%
Light REO recovery = 87%
Heavy REO recovery = 68%
Total REO recovery = 85%
(previously 80%)
The results confirmed the outstanding
performance of GML’s optimised flotation circuit,
with the ability to concentrate the rare earths into
a much smaller mass than that of the original
ore, allowing for a small refinery circuit for
hydrometallurgical treatment. The unique rare
earth minerals can be effectively processed in
a single stage atmospheric acid leach circuit in
which all impurities can be managed, allowing for
the production and export of a clean intermediate
rare earth product.
Continued development of the flotation circuit has
also involved further investigation of the removal
of excess fluoride ions in the process water. The
fluoride comes from the soluble mineral villiaumite
which is present in the ore. Configuration
changes to the flotation circuit allow for greater
fluoride removal prior to the main rare earth
flotation stage. The fluoride will be recovered
as fluorspar (metspar). Significantly, this results
in lower flotation reagent consumption, and
a substantial reduction of fluoride in tailings
which mitigates environmental impacts and
benefits environmental management. Further
enhancements in fluoride removal are expected
with ongoing process development.
Refinery pilot plant
During the December 2020 - January 2021
period, independent laboratory Nagrom in
Perth, Australia generated more than 50kg of
flotation concentrate assaying >20% TREO.
The concentrate will be processed in the first
quarter of 2021 using the refinery flowsheet to
generate various intermediate products for further
evaluation.
This process will produce three different mixed
rare earth products for technical evaluation to be
undertaken in conjunction with Shenghe. This
is an important step in identifying the optimal
intermediate product for downstream processing,
and the development of value chain integration.
Once a preferred product has been identified,
GML will finalise the refinery pilot plant design.
The Company intends to complete a pilot plant
for the Kvanefjeld refinery process in the first
half of 2021 to provide design information and
risk reduction to the refinery design, and it has
commenced planning for this.
7
GREENLAND MINERALS LIMITED – 2020 ANNUAL REPORT Operations Report (continued)
European Industry Engagement
Building Momentum
Through the year, GML continued to engage with
several peak European organisations to update
on the Kvanefjeld Project. Europe is set to be an
important growing demand centre for rare earths,
and there is an increasing level of interest and
awareness in the security of supply.
In September, the European Commission
launched the European Raw Materials Alliance
(ERMA) in recognition of the critical importance
of raw materials to the EU’s supply chain
security, sustainability and industrial leadership.
If Europe is to deliver a Green Deal as the
world’s first climate-neutral continent, continue
a digital transition and remain a leader in future
technologies, it faces a significant increase in
demand for critical raw materials.
‘The European Raw Materials Alliance will identify
barriers, opportunities and investment cases to
build capacity at all stages of the raw materials
value chain, from mining to waste recovery. In
a first phase, the alliance focuses on the most
pressing need, which is to increase EU resilience
in the rare earths and permanent magnets value
chains, as these are vital to most EU industrial
ecosystems. In addition to rapidly rising demand
driven by electric vehicles and energy storage,
demand for rare earths critical for products like
wind turbines could increase ten-fold by 2050’
(ERMA website).
Kvanefjeld is ideally placed to provide stable,
long-term supply of all critical rare earths to
European industry along with end-users globally.
GML is well positioned to develop collaborative
relationships with European industry.
8
GREENLAND MINERALS LIMITED – 2020 ANNUAL REPORT Successful $34 Million Capital Raising
GML is using proceeds to fund:
In November, the Company launched a capital
raising via an institutional share placement and
subsequent Share Purchase Plan for existing
shareholders. The institutional placement was
heavily bid for, with $30M raised from North
American, European and Australian funds, and
GML issued 125 million new fully paid ordinary
shares at $0.24 per share. The new shares were
issued under the Company’s existing ASX Listing
Rules 7.1 placement capacity.
Shareholders also strongly supported the
SPP, with $8.6 million in applications received.
Applications were scaled back with $4 million
accepted.
In total, $34 million was raised before costs.
Finalisation of Kvanefjeld licencing
and permitting;
Conversion of the optimised
feasibility study to a definitive
feasibility study;
Advancement of offtake and project
funding discussions;
Expansion of organisational
capacity to accelerate pre-
development work; and
General working capital purposes.
KVANEFJELD IS IDEALLY PLACED TO PROVIDE STABLE, LONG-TERM
SUPPLY OF ALL CRITICAL RARE EARTHS TO EUROPEAN INDUSTRY
ALONG WITH END-USERS GLOBALLY.
9
GREENLAND MINERALS LIMITED – 2020 ANNUAL REPORT Operations Report (continued)
Rare earths market
In 2020, the outlook for rare earth demand
continued to strengthen as momentum builds
globally for reduction in carbon emissions and
the transition to electric vehicles, renewable
energy, and increased energy efficiency. Critical
‘magnet rare earths’ are set to play a key role in
the facilitation of these important global agendas.
The primary magnet rare earths neodymium,
praseodymium, terbium and dysprosium all saw
marked price increases through the latter part
of 2020, with continued upward movement into
2021. This surge has been driven by strong
demand from end-users in China especially.
These four magnet rare earths are the main
value drivers to GML’s Kvanefjeld Project, owing
to the project’s unique exposure to both light and
heavy RE magnet metals. Demand is forecast to
continue to grow from to strong growth expected
for electric vehicles, wind turbines, and consumer
energy-efficient electric items. Demand for EV
in the USA is expected to grow with the country
re-joining the UN COP21 Paris Agreement.
The longer-term picture for rare earths remains
extremely robust. ADAMAS Intelligence is
forecasting global annual demand for magnet
rare earth oxides (Nd, Pr, Dy, Tb) will increase by
150% through to 2030. Meeting this demand will
require current global production to double.
When this is considered together with increasing
production costs in China, GML expects
considerable upward pressure on prices
over time. This outlook creates an optimal
development window for the Kvanefjeld Project
given its advanced status, favourable production
profile across all key magnet RE’s, and
competitive cost structure.
10
GREENLAND MINERALS LIMITED – 2020 ANNUAL REPORT
2021 Outlook
The Company’s core areas of focus in
2021 are on project permitting, technical
work programs to convert all aspects of
the Kvanefjeld Project to DFS level, and
commercial engagement with a strong
focus on European industry.
GML has commenced planning an active
field season in Greenland. Preparation
is advanced for pilot plant operations to
establish parameters for detailed engineering
design work, drawing on input from
Shenghe’s leading technical expertise. The
Company will continue to provide updates as
milestones are achieved across all key areas.
RARE EARTHS FROM KVANEFJELD
FOR THE WORLD’S GREENER
TECHNOLOGY
GREENLAND MINERALS LIMITED – 2019 ANNUAL REPORT
11
Operations Report (continued)
Resource Statements
12
Multi-Element Resources Classification, Tonnage and Grade Contained MetalCut-offClassification M tonnesTREO2U3O8LREOHREOREOY2O3ZnTREOHREOY2O3U3O8Zn(U3O8 ppm)1 Mtppmppmppmppmppmppmppm MtMtMtM lbsMtKvanefjeld - February 2015150Measured14312,10030310,70043211,1009782,3701.720.060.1495.210.34150Indicated30811,1002539,80041110,2008992,2903.420.130.28171.970.71150Inferred22210,0002058,8003659,2007932,1802.220.080.18100.450.48150Total67310,9002489,60040010,0008812,2707.340.270.59368.021.53200Measured11112,90034111,40045411,8001,0482,4601.430.050.1283.190.27200Indicated17212,30031810,90041611,3009702,5102.110.070.17120.440.43200Inferred8610,9002569,70033910,0008042,5000.940.030.0748.550.22200Total36812,10031010,70040911,2009552,4904.460.150.35251.830.92250Measured9313,30036311,80047412,2001,1052,4801.240.040.1074.560.23250Indicated13412,80034511,30043711,7001,0272,5201.720.060.14101.920.34250Inferred3412,00030610,80035611,1008692,6500.410.010.0322.910.09250Total26112,90034611,40044011,8001,0342,5203.370.110.27199.180.66300Measured7813,70037912,00049312,5001,1532,5001.070.040.0965.390.20300Indicated10013,30036811,70046512,2001,0952,5401.340.050.1181.520.26300Inferred1513,20035311,80039112,2009552,6200.200.010.0111.960.04300Total19413,40037111,90047112,3001,1072,5302.600.090.21158.770.49350Measured5414,10040312,40051812,9001,2192,5500.760.030.0747.590.14350Indicated6313,90039412,20050512,7001,1912,5800.870.030.0754.300.16350Inferred613,90039212,50042412,9001,0372,6500.090.000.015.510.02350Total12214,00039812,30050612,8001,1952,5701.710.060.15107.450.31GREENLAND MINERALS LIMITED – 2020 ANNUAL REPORT 13
Multi-Element Resources Classification, Tonnage and Grade Contained MetalCut-offClassification M tonnesTREO2U3O8LREOHREOREOY2O3ZnTREOHREOY2O3U3O8Zn(U3O8 ppm)1 Mtppmppmppmppmppmppmppm MtMtMtM lbsMtSørensen - March 2012150Inferred24211,0003049,70039810,1008952,6022.670.100.22162.180.63200Inferred18611,60034410,20039910,6009322,8022.150.070.17141.280.52250Inferred14811,80037510,50040710,9009612,9321.750.060.14122.550.43300Inferred11912,10040010,70041411,1009833,0231.440.050.12105.230.36350Inferred9212,40042211,00042211,4001,0043,0801.140.040.0985.480.28Zone 3 - May 2012150Inferred9511,60030010,20039610,6009712,7681.110.040.0963.000.26200Inferred8911,70031010,30040010,7009892,8061.030.040.0960.000.25250Inferred7111,90033010,50041010,9001,0262,9020.840.030.0751.000.20300Inferred4712,40035810,90043311,3001,0873,0080.580.020.0537.000.14350Inferred2413,00039211,40047111,9001,1843,043 0.310.010.0321.000.07All Deposits – Grand Total150Measured14312,10030310,70043211,1009782,3701.720.060.1495.210.34150Indicated30811,1002539,80041110,2008992,2903.420.130.28171.970.71150Inferred55910,7002649,4003849,8008672,4636.000.220.49325.661.38150Grand Total101011,0002669,70039910,1008932,397 11.140.400.90592.842.421There is greater coverage of assays for uranium than other elements owing to historic spectral assays. U3O8 has therefore been used to define the cutoff grades to maximise the confidence in the resource calculations.2Total Rare Earth Oxide (TREO) refers to the rare earth elements in the lanthanide series plus yttrium.Note: Figures quoted may not sum due to rounding.Kvanefjeld Ore Reserves Estimate – April 2015ClassInventory (Mt)TREO (ppm)LREO (ppm)HREO (ppm)Y2O3 (ppm)U3O8 (ppm)Zn (ppm)Proven4314,70013,0005001,1133522,700Probable6414,00012,5004901,1223682,500Total10814,30012,7004951,1183622,600GREENLAND MINERALS LIMITED – 2020 ANNUAL REPORT Operations Report (continued)
Competent Person Statement – Mineral Resources Ore Reserves and Metallurgy
The information in this report that relates to Mineral Resources is based on information compiled by Mr Robin Simpson, a Competent
Person who is a Member of the Australian Institute of Geoscientists. Mr Simpson is employed by SRK Consulting (UK) Ltd (“SRK”),
and was engaged by Greenland Minerals Limited on the basis of SRK’s normal professional daily rates. SRK has no beneficial interest
in the outcome of the technical assessment being capable of affecting its independence. Mr Simpson has sufficient experience that
is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken 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’. Robin Simpson consents to the inclusion in the report of the matters based on his information in the form and
context in which it appears.
The information in the statement that relates to the Ore Reserves Estimate is based on work completed or accepted by Mr Damien
Krebs of Greenland Minerals Limited and Mr Scott McEwing of SRK Consulting (Australasia) Pty Ltd. The information in this report
that relates to metallurgy is based on information compiled by Damien Krebs.
Damien Krebs is a Member of The Australasian Institute of Mining and Metallurgy and has sufficient experience that is relevant to the
type of metallurgy and scale of project under consideration, and to the activity he is undertaking, to qualify as Competent Persons
in terms of The Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (JORC Code, 2012
edition). The Competent Persons consent to the inclusion of such information in this report in the form and context in which it appears.
Scott McEwing is a Fellow and Chartered Professional of The Australasian Institute of Mining and Metallurgy and has sufficient
experience that is relevant to the style of mineralisation and type of deposit under consideration, and to the activity he is undertaking,
to qualify as Competent Persons in terms of The Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore
Reserves (JORC Code, 2012 edition). The Competent Persons consent to the inclusion of such information in this report in the form
and context in which it appears.
The mineral resource estimate for the Kvanefjeld Project was updated and released in a Company announcement on February 12th,
2015. The ore reserve estimate was released in a Company Announcement on June 3rd, 2015. There have been no material changes
to the resource estimate, or ore reserve since the release of these announcements.
THE VAST KVANEFJELD RESOURCE
IS ENRICHED IN ALL COMMERCIALLY
IMPORTANT RARE EARTH ELEMENTS.
14
GREENLAND MINERALS LIMITED – 2020 ANNUAL REPORT 2020 ANNUAL FINANCIAL REPORT
FOR THE YEAR ENDED 31 DECEMBER 2020
GREENLAND MINERALS LTD – 2020 ANNUAL FINANCIAL REPORT
15
15
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
DIRECTORS’ REPORT
The directors of Greenland Minerals Limited (the Company) submit herewith the annual financial
report of Greenland Minerals Limited and its subsidiaries (the Consolidated Group) for the financial
year ended 31 December 2020, pursuant to the provisions of the Corporations Act 2001. The
directors report the following:
Directors
The names of directors in office at any time during or since the end of the financial year are:
Anthony Ho, Non-Executive Chairman
John Mair, Managing Director
Simon Cato, Non-Executive Director
Xiaolei Guo, Non-Executive Director
Chief Financial Officer/Company Secretary
The following person held the position of Company Secretary at the end of the financial year:
Miles Simon Guy – M.Com(PA), MIPA, FCIS, FGIA, MAICD is a qualified accountant with more than
20 years’ experience in both public practice and commerce.
Mr. Guy is also the Chief Financial Officer for Greenland Minerals Limited.
Principal Activities
The principal activity of the Consolidated Group during the financial year was mineral exploration and
project evaluation. Specifically, the continued evaluation and permitting of the Kvanefjeld project,
located in Southern Greenland.
There were no significant changes in the nature of the Consolidated Group’s principal activities during
the financial year.
Operating Results
The net loss after providing for income tax amounted to $3,075,973 (2019: loss $2,851,390).
Review of operations
Refer to the Operations Report on pages 4 to 14.
COVID-19
The Consolidated Group acknowledges the impact COVID-19 has had on the global community.
While this impact has been wide spread and often significant, during the year ended 31 December
2020, the Consolidated Group has been well placed to continue work programs, including the
permitting process for the Kvanefjeld project.
The Consolidated Group has deferred scheduled pilot plant operations during 2020, however this is
not expected to impact on the Consolidated Group’s overall project timeline. The statutory public
consultation process for the Kvanefjeld project commenced on 17 December 2020 and was initially
set for a 12 week period. In early February 2021, the Greenland government extended the public
consultation period to 23 weeks, as a result of COVID-19 travel restrictions.
The Consolidated Group will continue to monitor any future impacts of COVID 19 and will make
appropriate ASX announcements if required.
During the year ended 31 December 2020 government assistance of $27,036 was received through a
reduction in payroll tax from the West Australian government and $117,500 was received in cashflow
support through the Australian Taxation Office. The cashflow support received was recognised in
accordance with the Consolidated group’s accounting policy. As outlined in note 2 of the financial
statements.
16
Page | 9
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
DIRECTORS’ REPORT
Significant Changes in State of Affairs
Other than as reported in the Review of Operations, during the financial year, there were no other
significant changes in the state of affairs of the Consolidated Group.
Shares
During the year ended 31 December 2020, 148,089,016 ordinary shares of Greenland Minerals were
issued, as detailed in Note 17 to the financial report.
The total number of ordinary shares on issue at 31 December 2020 was 1,339,071,546 (31 December
2019: 1,190,982,530).
The Company has only one class of shares on issue and the Company has no unissued shares, other
than those registered to options and performance rights holders which are disclosed in the next
section.
No shares issued during the year or shares issued since the end of the financial year were issued as
a result of exercised options.
Anti-dilution rights
Le Shan Shenghe Rare Earth Company Limited (Le Shan) has anti-dilution or top-up rights under the
Subscription Agreement entered into with the Company. Le Shan has the right to subscribe for top-up
shares to maintain its existing percentage interest where the Company issues additional shares which
increases the existing share capital by greater than 0.5%. The subscription price, under the top-up
right, will be the same price as any additional shares issued under a capital raising (in the event of a
cash capital raising) or, in any other event (such as non-cash consideration), the volume weighted
average price of the shares calculated over the last 10 days on which sales of shares were recorded
before the day on which the additional shares were issued. The top-up right is subject to Le Shan
maintaining at least a minimum share interest of 6.5% of shares in the Company and ceases to
operate where Le Shan’s Share interest or voting power exceeds 19.9%. In addition, the top-up right
will cease on the date the ASX considers that the strategic relationship between the Company and Le
Shan or Shenghe Resources Holding Co. Limited changes in such a way so as to effectively cease.
Options
During the year ended 31 December 2020 the number of options and performance rights of
Greenland Minerals Limited that were issued are detailed in Note 25 to the financial report.
Details of unissued shares or interests under option and employee rights at the date of this report are:
Number of
Shares
under
employee
rights
Number of
shares
under
option
Exercise
price of
option
Expiry date of
option/right
Issuing entity
Greenland Minerals
Limited
Greenland Minerals
Limited
Greenland Minerals
Limited
Greenland Minerals
Limited
1,754,000
6,000,000
-
-
-
-
2,525,000
4,000,000
Class of
shares
Ordinary
Shares
Ordinary
Shares
Ordinary
Shares
Ordinary
Shares
$0.15
31 March 2021
$0.35
31 January 2023
-
-
31 July 2021
15 August 2024
The holders of these options do not have the right, by virtue of being holders, to participate in any
share issue or interest issue of the Consolidated Group or of any other body corporate.
Page | 10
17
17
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
DIRECTORS’ REPORT
Financial Position
The net assets of the Consolidated Group were $124,771,456 as at 31 December 2020 (2019:
$94,489,369).
Dividends
During the financial year ended 31 December 2020, no dividends have been paid or declared since
the start of the financial year and the directors do not recommend the payment of a dividend in
respect of the financial year. No dividends were paid in the comparative period ended 31 December
2019.
Environmental Regulations
The Consolidated Group operates within the resources sector and conducts its business activities
with respect for the environment while continuing to meet the expectations of shareholders,
customers, employees and suppliers. The Consolidated Group’s exploration activities are currently
regulated by significant environmental regulation under laws of Greenland and the Commonwealth
and states and territories of Australia. The Consolidated Group is committed to ensure that the
highest standard of environmental care is achieved, and that it complies with all relevant
environmental legislation.
Future Developments
The Consolidated Group will continue to evaluate the Kvanefjeld project and the development
alternatives for the project, as referred to elsewhere in this report, particularly in the Operations
Report on pages 4 to 14.
Subsequent Events
On 16 February 2021, an early general election was called in Greenland, to be held on 6 April 2021. A
change of the Greenland government and any subsequent changes in government policy may impact
the Company’s Kvanefjeld project and the permitting process. It is not possible to assess what these
impacts may be at the date of signing this annual report.
The Company has a history of working cooperatively with Greenland governments and will look to
continue this co-operation into the future.
The statutory public consultation process for the Kvanefjeld project commenced on 17 December
2020 and was initially scheduled to continue for a 12 week period. The Greenland government
extended this to a 23 week period in early 2021 due to COVID 19 travel restrictions. The public
consultation period is now scheduled to conclude on 1 June 2021.
There have been no other matters or circumstances occurring subsequent to the financial year that
has significantly affected, or may significantly affect, the operations of the Consolidated Group, the
results of those operations, or the state of affairs of the Consolidated Group in future years.
18
Page | 11
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
DIRECTORS’ REPORT
Information on Directors
Anthony Ho (Tony) - Non-Executive Chairman - Appointed 9 August 2007
Special responsibilities
Member of the Audit Committee
Qualifications
B.Com (UNSW), CA, FAICD, FCIS, FGIA
Experience
Mr Tony Ho is an experienced company director having held executive directorships and chief
financial officer roles with a number of ASX listed companies. Tony was executive director of Arthur
Yates & Co Limited, retiring from that position in April 2002. His corporate, general management and
governance experience includes being chief financial officer/finance director of M.S. McLeod Holdings
Limited, Galore Group Limited and the Edward H O’Brien group of companies.
Tony is currently the chairman of ASX listed Bioxyne Limited (ASX: BXN), Truscreen Group Limited
(NZX and ASX:TRU) and Cannasouth Limited (NZX:CBD). He was previously the non-executive
chairman of Credit Intelligence Limited (ASX:CI1).
Tony was the past non-executive chairman of St. George Community Housing Limited (November
2002 to December 2009) where he successfully grew the NGO to be one of New South Wales leading
community housing companies.
Prior to joining commerce, Tony was a partner of Cox Johnston & Co, Chartered Accountants, which
has since merged with Ernst & Young.
Tony holds a Bachelor of Commerce degree from the University of New South Wales and is a
member of the Institute of Chartered Accountants in Australia and New Zealand and a fellow of the
Australian Institute of Company Directors, Institute of Chartered Secretaries and Administrators, and
Governance Institute of Australia.
Interest in shares & options
4,032,798 Ordinary Shares
Other board positions held
Non-executive Chairman – Bioxyne Limited (SAX:BXN) – November 2012
Non-executive Chairman – Truscreen Group Limited (NZX and ASX:TRU) – October 2018
Non-executive Chairman – Cannasouth Limited (NZX:CBD) - June 2019
Board positions held in the last 3 years
Non-executive Chairman Credit Intelligence Limited – June 2018 – April 2020
Page | 12
19
19
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
DIRECTORS’ REPORT
John Mair – Managing Director – Appointed 7 October 2011
Qualifications
PhD (Geol), MAus IMM
Experience
John Mair is a minerals industry professional with international experience across technical, corporate
and managerial roles. John holds a PhD in economic geology from the University of Western Australia
and was a post-doctoral research fellow at Mineral Deposit Research Unit, UBC, Vancouver, working
in close association with the US Geological Survey.
John has been a director of GML since 2011 and Managing Director from September 2014. John has
played a key role in the Company’s successful engagement with strategic entities, the political
interface with the Greenland and Danish governments and stakeholder groups, as well as driving a
number of significant funding initiatives, and the technical direction of the Company’s activities in
Greenland.
John presents on the Company’s behalf in commercial, technical, and political forums internationally.
He is a Member of the Australian Institute for Mining and Metallurgy (AusIMM).
Interest in shares & options
8,364,062 Ordinary Shares
Other board positions held
Non-executive director – Rox Resources Limited – 24 October 2019
Simon Cato – Non-Executive Director – Appointed 21 February 2006
Special responsibilities
Chairman of the Audit Committee
Qualifications
B.A. (USYD)
Experience
Mr Simon Cato has over 30 years’ experience in the capital markets in broking, regulatory roles and
as director of listed companies.
He was initially employed by the ASX in Sydney and then in Perth. From 1991 until 2006 Simon was
an executive director and/or responsible executive of three stockbroking firms. During that time Simon
was involved in the formation of a number of companies, including writing prospectuses and
managing the listing process and has been through the process of IPO listing in the dual role of
broker and director.
Since 2006 he has been an executive and non-executive director of a number of public companies
with a range of different business activities and was a founding director of Greenland Minerals
Limited.
Currently Simon holds a number of non-executive director roles with listed companies in Australia.
20
Page | 13
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
DIRECTORS’ REPORT
Simon Cato (cont’d)
Interest in shares & options
6,389,594 Ordinary shares
Other board positions held
Non-executive Chairman - Advanced Share Registry Limited - August 2007.
Non-executive director – Bentley Capital Limited – January 2015
Positions held in the last 3 Years
Non-executive director – Keybridge Capital limited – July 2016 to January 2020
Xiaolei Guo – Non-executive Director – Appointed 12 October 2017
Special responsibilities
Nil
Qualifications
BA.Law(CnU)
Experience
Mr Xiaolei Guo completed a Bachelor of Arts, major in law at China University of Political Science and
Law and was admitted to the Bar in China.
He was previously a judge assistant in Tianjin Hexi District People’s Court from July 2004, then joined
King & Wood Mallesons in September 2007, working in the securities department specialising in
providing securities and investment services to clients. He was extensively involved in IPOs, M&A
bond issues bankruptcy and other corporate matters.
In early 2014, he joined Shenghe Resources Holding Co., Ltd as General Manager Assistant and
Manager of the investments and development department. In this role, Mr Guo focused on the
acquisition of rare earth projects and played a key role in selecting and evaluating project and
participated in the negotiation and legal aspects of acquisitions.
Xiaolei is Le Shan Shenghe Rare Earth Company Limited’s nominee to the Company’s board.
Interest in shares & options
Nil Ordinary shares
Directorships held in other listed entities
Nil
Page | 14
21
21
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
DIRECTORS’ REPORT
Remuneration Report – Audited
This remuneration report, which forms part of the directors’ report, details the nature and amount of
remuneration for each director and other key management personnel (KMP) of Greenland Minerals
Limited, for the financial year ended 31 December 2020.
Director and key management personnel details
The following persons acted as directors and other KMP of the Company during or since the end of
the financial year and unless otherwise stated, positions were held for the full year ended 31
December 2020 and continued to be held at the date of this report:
Directors
Anthony Ho, Non-Executive Chairman
John Mair, Managing Director
Simon Cato, Non-Executive Director
Xiaolei Guo, Non-Executive Director
Key management personnel
Miles Guy, Chief Financial Officer and Company Secretary
Jørn Skov Nielsen, Executive General Manager, Greenland Minerals A/S – commenced 1
July 2020
Remuneration Policy
The remuneration policy of Greenland Minerals Limited is to align director and senior management
objectives with shareholder and business objectives by providing a fixed remuneration component
and offering specific short and long-term incentives based on meeting service period requirements
and share price vesting hurdles. The board of Greenland Minerals Limited believes the remuneration
policy to be appropriate and effective in its ability to attract and retain the best senior management
and directors to run and manage the Consolidated Group, as well as create alignment of interests
between directors, senior management and shareholders.
Greenland Minerals Limited does not have a separate remuneration committee, with the role of the
remuneration committee being the responsibility of the board. The board considers this appropriate
given the current size and structure of the board and the Company.
The board’s policy for determining the nature and amount of remuneration for board members and
senior executives of the Consolidated Group is as follows:
• All senior management receive a market rate base salary (which is based on factors such as
length of service and experience).
• The Australian directors and senior management, where applicable receive a superannuation
contribution, which is currently 9.5% and do not receive any other retirement benefits.
• All remuneration paid to directors and senior management is valued at the cost to the
Consolidated Group and expensed. Options and rights granted to directors and senior
management as part of remuneration are valued at grant date using appropriate valuation
techniques.
• Vesting hurdles attached to options or share rights are structured to ensure an alignment with
an increase in shareholder value.
22
Page | 15
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
DIRECTORS’ REPORT
Remuneration Report – Audited (cont’d)
• The board policy is to remunerate non-executive directors with a base fee and an additional
fee at market rates for time for any additional commitment and responsibilities. The board as
a whole determines payments to the non-executive directors and reviews their remuneration
annually, based on market rates, their specific duties and responsibilities. Additional
consultancy fees may be payable where the non-executive director has additional
responsibilities associated with specific tasks or responsibilities outside of their normal duties.
The maximum aggregate amount of fees that can be paid to non-executive directors is
subject to approval by shareholders at the Annual General Meeting. The current shareholder
approved cap on these fees is $400,000 per annum. Fees for non-executive directors are not
linked to the performance of the Consolidated Group. However, to align directors’ interests
with shareholder interests, the directors are encouraged to hold shares in the Company.
Cash based payments
Salary and fees
All directors and senior management receive a cash based salary or director fees. No bonuses or
additional similar benefits were paid during the year ended 31 December 2020.
Post-employment benefits
Directors and senior management, where required also receive superannuation contibution of 9.5%
on their gross salary. There are no entitlements to other additional post-employment benefit.
Long-term remuneration
The managing director and senior management are entitled to receive long service leave after 10
years continuous service, with a pro-rata entitlement after 7 years. Although a provision for this
payment is recognised, no actual payments for long service leave were made in the year ended 31
December 2020.
Share based payments
Short term incentives (STI)
The Consolidated Group does not have a short term incentive scheme that is in addition to the short
term employee benefits. The Consolidated Group considers that short term incentive schemes would
not be consistent with shareholder value at the Consolidated Group’s current stage of development.
Long term incentives (LTI)
During the year ended 31 December 2020, the board approved the issue of Employee Performance
Rights to Jørn Skov Nielsen. The board, during the year ended 31 December 2019 approved the
issue of Employee Performance Rights to all employees, including KMP but excluding directors.
Termination payments
Director and senior management are not entitled to any termination payment other than statutory
entitlements and notice period payment. There are no notice period requirements for Non-executive
Directors and the notice period requirements for Executive Directors and Senior Management are
disclosed key terms of employment contracts, on pages 28 to 29.
Page | 16
23
23
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
DIRECTORS’ REPORT
Remuneration Report – Audited (cont’d)
Details of Remuneration
The remuneration for the directors and senior management of the Company during the current
financial year was as follows:
Short term benefits
Salary &
fees
$
Other (ii)
$
Post-
employment
benefits
Super-
annuation
$
Long –term
remuneration
Provision for
long service
leave
$
Share Based payments
STI
$
Rights (i)
$
Total
Remuneration
$
%
Performance
based
350,000
26,924
33,250
2,914
100,000
50,000
40,000
-
-
9,500
4,750
-
-
-
-
220,000
9,308
20,900
1,833
-
138,913
898,913
2,084
38,316
-
68,400
-
4,747
-
-
-
-
-
-
-
-
-
-
413,088
109,500
54,750
40,000
-
-
-
-
370,264
118,223
(iv)
149,045
290,042
267,268 1,277,644
31.9%
51.4%
20.9%
2020
Executive
Director
J Mair
Non-executive
Director
A Ho
S Cato
X Guo
Senior
Management
M Guy
JS Nielsen (iii)
TOTAL
(i)
(ii)
(iii)
(iv)
Rights issued are Employee Performance Rights that are Long Term Incentives and are
subject to service period and share price vesting hurdles which are detailed further in Note 25
of the financial statements. The rights do not vest into fully paid shares unless vesting
conditions are satisfied.
Recognition of increase in annual leave provision resulting from the accrual of statutory
annual leave being greater than the annual leave taken.
Jørn Skov Nielsen commenced as Executive General Manager, Greenland Minerals A/S on 1
July 2020. Jørn’s cash remuneration is paid in Danish Krone (DKK), an average rate of
DKK4.49922 to AU$1.00 has been applied to the cash remuneration.
At 31 December 2020 the rights granted to Jørn Skov Nielsen remained unvested and as a
result, the rights represent no value to monetary value to the holder.
24
Page | 17
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
DIRECTORS’ REPORT
Remuneration Report – Audited (cont’d)
The remuneration for the directors and senior management of the Company during the previous
financial year was as follows:
Short term benefits
Salary &
fees
$
Other
$
Post-
employment
benefits
Super-
annuation
$
Long –term
remuneration
Provision for
long service
leave
$
Share Based payments
STI
$
Rights (i)
$
Total
Remuneration
$
%
Performance
based
350,000
(iii)
226,923
33,249
5,858
100,000
50,000
40,000
-
-
-
9,500
4,749
-
-
-
-
-
-
-
-
(ii)
(275,200)
340,830
(80.1)%
-
-
-
109,500
54,749
40,000
-
-
-
(iv)
11,186
220,000
760,000 238,109
20,900
68,398
3,667
9,525
-
-
96,577
(178,623)
352,330
897,409
27.7%
(19.9)%
2019
Executive
Director
J Mair
Non-executive
Director
A Ho
S Cato
X Guo
Senior
Management
M Guy
TOTAL
(i)
(ii)
(iii)
(iv)
Rights issued are Employee Performance Rights that are Long Term Incentives and are
subject to service period, share price and performance vesting hurdles which are detailed
further in Note 25 of the financial statements. The rights do not vest into fully paid shares
unless vesting conditions are satisfied. At 31 December 2019, all rights remained unvested
and as a result the rights represent no monetary value to the holder.
Reversal of prior year pro-rata recognition of the value of unvested performance rights
following a review at 31 December 2019 of the likelihood of the vesting hurdles being
achieved prior to the expiry date of 31 May 2020.
Recognition of a $200,000 board approved performance bonus for the year ended 31
December 2019 and recognition of increase in annual leave provision resulting from the
accrual of statutory annual leave being greater than the annual leave taken.
Recognition of increase in annual leave provision resulting from the accrual of statutory
annual leave being greater than the annual leave taken.
Rights issued
The Company issued 4,000,000 performance rights to Jørn Skov Nielsen during the year ended 31
December 2020, under the Company’s Employee Incentive Plan.
The rights are subject to service period and share price vesting hurdles and were issued to assist with
retaining and incentivising the employee. The rights align with increasing shareholder value. The
rights can only vest into fully paid ordinary shares on satisfying the vesting hurdles prior to 15 August
2024. being the expiry date of the rights.
The following un-vested performance rights were issued during the current financial year ended 31
December 2020.
Jørn Skov
Nielsen
Tranche 1
Tranche 2
Total
Grant date Number
10/08/2020 4,000,000
10/08/2020 2,000,000
4,000,000
Fair value @
grant date
$
469,200
451,000
920,200
Expiry
date
15/08/2024
15/08/2024
Number
vested
Nil
Nil
Nil
Page | 18
25
25
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
DIRECTORS’ REPORT
Remuneration Report – Audited (cont’d)
The fair value has been established using a binomial model based on the following inputs. The fair
value will be recognised over the determined vesting period, in accordance with Australian Accounting
Standards.
Grant date
Underlying share price at grant date
Maximum life
Expected future volatility
Risk free rate
Share price hurdle (30-day VWAP)
Tranche 1
10 Aug 2020
$0.25
4 Years
75%
0.41%
$0.30
Tranche 2
10 Aug 2020
$0.25
4 Years
75%
0.41%
$0.35
Vesting conditions:
Tranche
Tranche 1
Number
2,000,000
Tranche 2
2,000,000
Service Condition
The employee has to remain
as an employee until 15
August 2022 and remain an
employee at the time of
vesting
The employee has to remain
as an employee until 15
August 2023 and remain an
employee at the time of
vesting
Performance Condition
From grant date and up to 15
August 2024 the Company’s price
based on a 20 trading day
volume weighted average price to
be $0.30 or more
From grant date and up to 15
August 2024 the Company’s price
based on a 20 trading day
volume weighted average price to
be $0.35 or more
Rights – vested
During the year ended 31 December 2020, the following performance rights satisfied the vesting
conditions, each exercised performance right was converted to one fully paid ordinary share:
KMP
Miles Guy
Total
Grant
date
Opening
balance
10/07/2019 1,500,000
1,500,000
Vested
1,500,000
1,500,000
Fair value @
grant date
$
214,800
214,800
Closing
balance
Expiry date
31/07/2021
Nil
Nil
(i) The weighted average share price at date of vesting was $0.28
No performance rights vested during the prior year ended 31 December 2019.
Rights expired
The following performance rights lapsed during the year ended 31 December 2020:
Director
J Mair
Tranche 1
Tranche 2
Total
Grant
date
31/05/2017
31/05/2017
Number
1,200,000
4,800,000
6,000,000
Fair value @
grant date
$
Expiry
date
Value @
expiry date
106,800
31/05/2020
384,000
31/05/2020
490,800
Nil
Nil
Nil
26
Page | 19
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
DIRECTORS’ REPORT
Remuneration Report – Audited (cont’d)
The rights were issued in 2 tranches with both tranches being subject to a 12 month service period
and the following share price performance hurdle.
Tranche
Tranche 1
Tranche 2
10 Day VWAP share
price hurdle
Number
$0.182
$0.242
1,200,000
4,800,000
In addition to the share price performance hurdle, tranche 2 was subject to the additional performance
hurdle of the Consolidated Group being granted a mining licence for the Kvanefjeld project.
No rights expired or lapsed during the prior year ended 31 December 2019.
Rights cancelled
No un-vested Employee Performance Rights were cancelled during the current financial year ended
31 December 2020 or the previous financial year ended 31 December 2019.
Options exercised
No options issued to directors or senior management were exercised during the year ended 31
December 2020 or during the prior year ended 31 December 2019.
KMP inducements
No director or senior management person appointed during the current or prior period received a
payment as part of his consideration for agreeing to hold the position.
No cash bonuses were paid to any directors or senior management during the current year ended 31
December 2020. A cash bonus of $200,000 was awarded to John Mair during the prior year ended 31
December 2019.
Key management personnel equity holdings
Refer to Note 28 for full details of key management personnel equity holdings.
Transactions with related parties
Simon Cato is a Non-executive Director and Chairman of Advanced Share Registry Limited.
Advanced Share Registry Limited provides share registry services to Greenland Minerals Limited.
These services are supplied on normal commercial terms and Mr Cato does not receive any
remuneration from Advanced Share Registry Limited based on the supply of share registry services to
the Consolidated Group. For the year ended 31 December 2020 $91,762 was paid to Advance Share
Registry Limited for services provided (Dec 2019: $42,814).
Consolidated Group performance, shareholder wealth and director and senior management
remuneration
The remuneration policy is designed to align the interests of shareholders, directors and senior
management. To achieve this aim, the entity may issue options and/or rights to directors and senior
management. Any issue of options is based on the performance of the Consolidated Group and or
individual and is limited to the achievement of clearly defined bench marks and milestones. These
benchmarks and milestones may include:
Page | 20
27
27
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
DIRECTORS’ REPORT
Remuneration Report – Audited (cont’d)
§ Share price and or the market capitalisation of the Company exceeding pre-determined
levels.
§ Completion of specific projects or pre-determined stages of projects.
§ Periods of service with the Company.
§ Accretion of shareholder value.
The following table shows the gross revenue and profits for the period from 31 December 2016 to 31
December 2020 for the listed entity, as well as the share price at the end of each financial period.
Remuneration Report
Revenue
Net loss before and after tax
Share price at beginning of
period
Share price at end of period
Dividend
Basic loss per share
Diluted loss per share
12 month
period ended
31 Dec
2020
12 Month
period ended
31 Dec
2019
12 Month
period ended
31 Dec
2018
$132,661
($3,075,973) ($2,851,390) ($2,829,697)
$158,341
$63,920
12 Month
period ended
31 Dec
2017
$126,547
($2,488,863)
12 Month
period ended
31 Dec
2016
$82,966
($2,172,733)
$0.13
$0.27
-
$0.03
$0.03
$0.07
$0.13
-
$0.03
$0.03
$0.10
$0.07
-
$0.03
$0.03
$0.07
$0.10
-
$0.03
$0.03
$0.03
$0.07
-
$0.03
$0.03
Key terms of employment contracts
Directors
Anthony Ho, Non-executive Chairman
§§ Director fee of $100,000 per annum.
§§ A consultant’s fee of $1,500 per day for pre-approved work undertaken in addition to the
Director’s duties.
§§ Superannuation at 9.5% is payable on the base director’s fee.
§§ Entitled to be reimbursed for all out of pocket expenses necessarily incurred in the
performance of his duties including relating to travel, entertainment, accommodation, meals
and telephone.
§§ No fixed term.
John Mair, Managing Director
§§ Term and type of contract – service agreement subject to annual review.
§§ Base salary, of $350,000 per annum and is paid monthly two weeks in advance and two
weeks in arrears.
§§ Subject to an annual remuneration review.
§§ Superannuation at 9.5% is payable on the base salary.
§§ Either the Company or the employee may terminate his engagement without cause by
giving the other party twelve months written notice, there are no other specific payout
clauses.
§§ Entitled to be reimbursed for all out of pocket expenses necessarily incurred in the
performance of his duties including relating to travel, entertainment, accommodation,
meals and telephone.
28
Page | 21
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
DIRECTORS’ REPORT
Remuneration Report – Audited (cont’d)
Simon Cato, Non-Executive Director
§§ Director fee of $50,000 per annum.
§§ A consultant’s fee of $1,500 per day for pre-approved work undertaken in addition to the
Director’s duties.
§§ Superannuation at 9.5% is payable on the base director’s fee.
§§ Entitled to be reimbursed for all out of pocket expenses necessarily incurred in the
performance of his duties including relating to travel, entertainment, accommodation, meals
and telephone.
§§ No fixed term.
Xiaolei Guo, Non-Executive Director
§§ Director fee of $40,000 per annum.
§§ A consultant’s fee of $1,500 per day for pre-approved work undertaken in addition to the
Director’s duties.
§§ Entitled to be reimbursed for all out of pocket expenses necessarily incurred in the
performance of his duties including relating to travel, entertainment, accommodation, meals
and telephone.
§§ No fixed term.
Senior Management
Miles Guy, Chief Financial Officer and Company Secretary
§§ Term and type of contract – service agreement subject to annual review.
§§ Base salary, of $220,000 per annum and is paid monthly two weeks in advance and two
weeks in arrears.
§§ Superannuation at 9.5% is payable on the base salary.
§§ Entitled to be reimbursed for all out of pocket expenses necessarily incurred in the
performance of his duties including relating to travel, entertainment, accommodation,
meals and telephone.
§§ Either the Company or the employee may terminate his engagement without cause by
giving the other party three months written notice, there are no other specific payout
clauses
§§ Remuneration will be reviewed every 12 months or as otherwise agreed between the
parties.
Jørn Skov Nielsen, Executive General Manager, Greenland Minerals A/S
§§ Term and type of contract – service agreement subject to annual review.
§§ Base salary, of DKK1,250,000 per annum and is paid monthly in arrears.
§§ Entitled to be reimbursed for all out of pocket expenses necessarily incurred in the
performance of his duties including relating to travel, entertainment, accommodation,
meals and telephone.
§§ Either the Company or the employee may terminate his engagement without cause by
giving the other party three months written notice, there are no other specific payout
clauses
§§ Remuneration will be reviewed every 12 months or as otherwise agreed between the
parties.
Remuneration Report – Audited - END
Page | 22
29
29
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
DIRECTORS’ REPORT
Meetings of Directors
During the financial year, 11 meetings of directors were held. Attendances by each director during the
year were as follows:
Director
A Ho
J Mair
S Cato
X Guo
Directors Meetings
Number of meetings
eligible to attend
11
11
11
11
Number
attended
11
9
11
11
Audit and Risk Committee
The audit and risk committee members are Simon Cato (Chairman) and Anthony Ho. The audit and
risk committee is to meet at least twice a year and must have a quorum of two members. There were
2 audit and risk committee meetings held during the current financial year, as follows:
Audit Committee Meetings
Member
S Cato
A Ho
Number of meetings
eligible to attend
2
2
Number
Attended
2
2
Indemnifying Officers
During or since the end of the financial period the Company has given an indemnity or entered into an
agreement to indemnify, or paid or agreed to pay insurance premium to insure the directors against
liabilities for costs and expenses incurred by them in defending any legal proceedings arising out of
their conduct while acting in the capacity of the director of the Consolidated Group, other than conduct
involving a willful breach of duty in relation to the Consolidated Group.
Proceedings on Behalf of Consolidated Group
No person has applied for leave of court to bring proceedings on behalf of the Consolidated Group or
intervene in any proceedings to which the Consolidated Group is a party for the purpose of taking
responsibility on behalf of the Consolidated Group for all or any part of those proceedings.
The Consolidated Group was not a party to any such proceedings during the period.
Non-audit Services
Details of amounts paid to the auditors of the Company, Deloitte Touche Tohmatsu and its related
practices for audit and any non audit services for the year, are set out in note 30.
Auditor’s Independence Declaration
The auditor’s independence declaration for the year ended 31 December 2020 has been received and
is included on page 32 the financial report.
Corporate governance statement
The Board of Directors of Greenland Minerals Limited is responsible for the corporate governance of
the Consolidated Group. The Company’s board and the executives of the Consolidated Group
recognises the need to formulate corporate governance policies that establish and maintain the
highest standards of ethical behaviour and accountability and for the policies to meet the
requirements of the market regulators and the expectations of members and other stakeholders.
30
Page | 23
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
DIRECTORS’ REPORT
The corporate governance policies are regularly reviewed to ensure they are appropriate as the
Company and corporate governance expectations evolve. The Company’s corporate governance
policy has been structured taking into consideration the fourth edition of the ASX Corporate
Governance Council Principles and Recommendations. The policy was approved by the board on
25 March 2020 and is available on the Company’s website: https://www.ggg.gl/investors/corporate-
governance/
Rounding off of amounts
The Consolidated Group is a Consolidated Group of the kind referred to in ASIC Instrument 2016/191,
dated 28 March 2016. In accordance with that Instrument amounts in the directors’ report and the
financial report are rounded off to the nearest thousand dollars, unless otherwise indicated.
Signed in accordance with a resolution of directors, made pursuant to section 298(2) of the
Corporations Act 2001.
On behalf of the Directors.
John Mair
Managing Director
31 March 2021
Page | 24
31
31
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Deloitte Touche Tohmatsu
ABN 74 490 121 060
Tower 2, Brookfield Place
123 St Georges Terrace
Perth WA 6000
GPO Box A46
Perth WA 6837 Australia
Tel: +61 8 9365 7000
Fax: +61 8 9365 7001
www.deloitte.com.au
The Board of Directors
Greenland Minerals Limited
Unit 7, 100 Railway Road
Subiaco WA 6008
31 March 2021
Dear Board Members
Greenland Minerals Limited
In accordance with section 307C of the Corporations Act 2001, I am pleased to provide the following
declaration of independence to the directors of Greenland Minerals Limited.
As lead audit partner for the audit of the financial report of Greenland Minerals Limited for the year
ended 31 December 2020, I declare that to the best of my knowledge and belief, there have been no
contraventions of:
(i)
the auditor independence requirements of the Corporations Act 2001 in relation to the
audit; and
(ii) any applicable code of professional conduct in relation to the audit.
Yours sincerely
DELOITTE TOUCHE TOHMATSU
Ian Skelton
Partner
Chartered Accountants
Liability limited by a scheme approved under Professional Standards Legislation
Member of Deloitte Asia Pacific Limited and the Deloitte organisation.
Deloitte Touche Tohmatsu
ABN 74 490 121 060
Tower 2, Brookfield Place
123 St Georges Terrace
Perth WA 6000
GPO Box A46
Perth WA 6837 Australia
Tel: +61 8 9365 7000
Fax: +61 8 9365 7001
www.deloitte.com.au
Independent Auditor’s Report to the members of Greenland
Minerals Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Greenland Minerals Limited (the “Company”) and its subsidiaries (the
“Group”) which comprises the consolidated statement of financial position as at 31 December 2020, the
consolidated statement of profit or loss and other comprehensive, the consolidated statement of changes in
equity and the consolidated statement of cash flows for the year then ended, and notes to the financial
statements, including a summary of significant accounting policies and other explanatory information, and the
directors’ declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act 2001,
including:
• Giving a true and fair view of the Group’s financial position as at 31 December 2020 and of their financial
performance for the year then ended; and
• 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 & 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 confirm that the independence declaration required by the Corporations Act 2001, which has been given to
the directors of the Company, would be in the same terms if given to the directors as at the time of this auditor’s
report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
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 for 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.
Liability limited by a scheme approved under Professional Standards Legislation
Member of Deloitte Asia Pacific Limited and the Deloitte organisation.
Key Audit Matter
How the scope of our audit responded to the Key
Audit Matter
Carrying value of Exploration and Evaluation Assets
As at 31 December 2020 the carrying value of
exploration and evaluation assets as disclosed in Note
13 to the financial statements amounts to $89.3
million. The Group’s accounting policy in respect of
exploration and evaluation assets is disclosed in Note
2.
is applied
judgement
Significant
in determining
whether facts and circumstances indicate that the
exploration and expenditure assets should be tested
for impairment in accordance with the relevant
accounting standards including:
• whether the entity has the right to tenure of the area
of interest at 31 December 2020;
• the likelihood of the exploration licence being
renewed;
• the status and results of current exploration
programmes;
• the planned future work programmes and budgeted
expenditure on the area of interest;
• whether the project has reached a stage whereby
economic recoverable reserves have been identified
which may indicate that the current carrying value is
above its recoverable amount; and
impact,
• the
if any, of the changing political
environment subsequent to year end as disclosed in
note 32 of the financial statements.
Our procedures included, but were not limited to:
• confirming whether the rights to tenure of the area
of interest remained current to balance sheet date,
• assessing the status of ongoing exploration and
evaluation programmes, and the mining
licence
application process for the respective area of interest,
• assessing evidence of the future intention for the
area of interest, including reviewing future budgeted
expenditure and related work programmes;
• confirming whether exploration activities for the
interest had reached a stage where a
area of
reasonable assessment of economically recoverable
reserves existed and compared this to the current
carrying value; and
• evaluating whether developments subsequent to
year end with respect to the changing political
situation in Greenland were indicative of events or
circumstances that existed as at 31 December 2020,
and assessing the impact of these subsequent events
on the carrying value of the project at year end.
We also assessed the appropriateness of the
disclosures in Note 13 and 32 to the financial
statements.
Other Information
The directors are responsible for the other information. The other information comprises the information included
in the Group’s annual report for the year ended 31 December 2020, 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 ability of the Group to continue as
a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of
accounting unless the directors either intend to liquidate the Group or to cease operations, or has no realistic
alternative but to do so.
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.
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional judgement and
maintain professional scepticism throughout the audit. We also:
•
Identify and assess the risks of material misstatement of the financial report, whether due to fraud or error,
design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and
appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from
fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions,
misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the
Group’s internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and
related disclosures made by the directors.
• Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based on
the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may
cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material
uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the
financial report or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the
audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause
the Group to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the financial report, including the disclosures, and
whether the financial report represents the underlying transactions and events in a manner that achieves fair
presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business
activities within the Group to express an opinion on the financial report. We are responsible for the direction,
supervision and performance of the Group’s audit. We remain solely responsible for our audit opinion.
We communicate with the directors regarding, among other matters, the planned scope and timing of the audit
and significant audit findings, including any significant deficiencies in internal control that we identify during our
audit.
We also provide the directors with a statement that we have complied with relevant ethical requirements
regarding independence, and to communicate with them all relationships and other matters that may reasonably
be thought to bear on our independence, and where applicable, actions taken to eliminate threats or safeguards
applied.
From the matters communicated with the directors, we determine those matters that were of most significance
in the audit of the financial report of the current period and are therefore the key audit matters. We describe
these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or
when, in extremely rare circumstances, we determine that a matter should not be communicated in our report
because the adverse consequences of doing so would reasonably be expected to outweigh the public interest
benefits of such communication.
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 22 to 29 of the Directors’ Report for the year ended
31 December 2020.
In our opinion, the Remuneration Report of Greenland Minerals Limited, for the year ended 31 December 2020,
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.
DELOITTE TOUCHE TOHMATSU
Ian Skelton
Partner
Chartered Accountants
Perth, 31 March 2021
Directors’ declaration
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
The directors declare that:
(a)
in the directors’ opinion, there are reasonable grounds to believe that the Company will be able
to pay its debts as and when they become due and payable;
in the directors’ opinion, the attached financial statements and notes thereto are in accordance
with the Corporations Act 2001, including compliance with accounting standards and giving a
true and fair view of the financial position, as at 31 December 2020 and performance of the
Consolidated Group for the financial year ended on that date;
the attached financial statements and notes thereto, are in compliance with International
Financial Reporting Standards as stated in note 2 of the financial statements; and
the directors have been given the declarations required by s.295A of the Corporations Act 2001.
(b)
(c)
(d)
Signed in accordance with a resolution of the directors made pursuant to s.295(5) of the Corporations
Act 2001.
On behalf of the Directors
John Mair
Managing Director
Subiaco, 30 March 2021
Page | 29
37
37
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
Consolidated statement of profit or loss and other comprehensive income
for the year ended 31 December 2020
Revenue from continuing operations
Expenditure
Director and employee benefits
Professional fees
Listing costs
Finance costs
Other expenses
Loss before tax
Income tax expense
Loss for year
Other comprehensive income
Items that may be reclassified subsequently to profit
and loss
Exchange difference arising on translation of foreign
operations
Income tax relating to components of
comprehensive income
Other comprehensive income for the year
Total comprehensive (loss)/gain for the year
(Loss) attributable to:
Owners of the parent
Total comprehensive (loss)/gain attributable to:
Owners of the parent
Basic loss per share – cents per share
Diluted loss per share – cents per share
Note
5
6(a)
6(b)
6(c)
6(d)
6(e)
7
7
21
Dec
2020
$' 000
Dec
2019
$' 000
158
64
(1,728)
(809)
(119)
(24)
(554)
(3,076)
-
(3,076)
(1,370)
(624)
(114)
(29)
(778)
(2,851)
-
(2,851)
339
(1,267)
-
339
(2,737)
(3,076)
(3,076)
(2,737)
(2,737)
0.26
0.26
-
(1,267)
(4,118)
(2,851)
(2,851)
(4,118)
(4,118)
0.25
0.25
Notes to the financial statements are included on pages 42 to 72
38
Page | 30
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Consolidated statement of financial position
as at 31 December 2020
Current Assets
Cash and cash equivalents
Trade and other receivables
Other assets
Total Current Assets
Non-Current Assets
Property, plant and equipment
Right of use assets
Capitalised exploration and evaluation expenditure
Total Non-Current Assets
Total Assets
Current Liabilities
Trade and other payables
Lease liability
Provisions
Total Current Liabilities
Non-Current Liabilities
Lease liability
Provisions
Total Non-Current Liabilities
Total Liabilities
Net Assets
Equity
Issued Capital
Reserves
Accumulated Losses
Total Equity
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
Note
8
9
10
11
12
13
14
15(a)
16(a)
15(b)
16(b)
Dec
2020
$' 000
Dec
2019
$' 000
36,438
185
93
36,716
8,599
714
86
9,399
761
448
89,343
90,552
785
522
85,886
87,193
127,268
96,592
1,259
188
703
2,150
302
44
346
941
138
441
1,520
410
172
582
2,496
124,772
2,102
94,490
17
18
20
404,688
371,808
(31,075)
(248,841)
124,772
(31,553)
(245,765)
94,490
Notes to the financial statements are included on pages 42 to 72
Page | 31
39
39
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
Consolidated statement of changes in equity
for the year ended 31 December 2020
Non -
Controlling
interest
Foreign
currency
translation acquisition Accumulated
reserve
reserve
losses
Issued Option
reserve
capital
Balance at 1 January 2019
$' 000
365,247
$' 000
$' 000
604
8,503
$’000
(39,672)
$' 000
(242,914)
Total
$' 000
91,768
-
-
Net loss for the year
Other Comprehensive
income
Total comprehensive
for the year
Issue of shares net of
transaction costs
Recognition of reversal of share
based payments – directors
Recognition of share based
-
payments - employees
Balance at 31 December 2019 371,808
6,561
-
-
Balance at 1 January 2020
371,808
-
-
-
Net loss for the year
Other Comprehensive
income
Total comprehensive
for the year
Issue of shares net of
transaction costs
Issue of shares- exercise of
options
Issue of shares- vesting of
employee rights
Recognition of share based
payments - employees
Recognition of share based
payments - other
-
Balance at 31 December 2020 404,688
31,945
870
65
-
-
-
-
-
(275)
554
883
883
-
-
-
-
(18)
(870)
827
200
1,022
-
(1,267)
(1,267)
-
-
-
-
-
-
-
(2,851)
(2,851)
-
(1,267)
(2,851)
(4,118)
-
-
6,561
(275)
-
7,236
-
(39,672)
-
(245,765)
554
94,490
7,236
(39,672)
(245,765)
94,490
-
339
339
-
-
-
-
-
-
-
-
-
-
-
(3,076)
(3,076)
-
339
(3,076)
(2,737)
-
-
-
-
31,945
47
-
827
-
7,575
-
(39,672)
-
(248,841)
200
124,772
Notes to the financial statements are included on pages 42 to 72
40
Page | 32
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
Consolidated statement of cash flows
for the year ended 31 December 2020
Cash flows from operating activities
Receipts from customers
Government assistance
Payments to suppliers and employees
Interest – leased assets
Net cash used in operating activities
Cash flows from investing activities
Interest received
Payments for exploration and development
Proceeds from R&D refund
Payments for plant and equipment
Net cash used in investing activities
Cash flows from financing activities
Proceeds from issue of shares/options, net of capital raising
costs
Payments on lease liabilities
Net cash from financing activities
Net increase/(decrease) in cash and equivalents
Cash and equivalents at the beginning of the financial year
Cash and equivalents at the end of the
Financial year
Note
24
31 Dec
2020
$' 000
31 Dec
2019
$' 000
4
117
(1,602)
(24)
(1,505)
42
(3,151)
667
(42)
(2,484)
31,992
(164)
31,828
27,839
8,599
8
-
(2,006)
(29)
(2,027)
61
(2,506)
(11)
(2,456)
6,561
(181)
6,380
1,897
6,702
8
36,438
8,599
Notes to the financial statements are included on pages 42 to 72
Page | 33
41
41
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
Notes to the accounts
1. General information
Greenland Minerals Limited is a public Company listed on the Australian Securities Exchange,
incorporated in Australia and operating in Greenland with its head office in Perth.
Greenland Minerals Limited’s registered office and its principal place of business are as follows:
Registered office
Unit 7, 100 Railway Road Subiaco WA
Principal place of business
Unit 7, 100 Railway Road Subiaco WA
The Company’s principal activities are mineral exploration and evaluation.
2. Significant accounting policies
Statement of compliance
The financial report is a general purpose financial report which has been prepared in accordance with
the Corporations Act 2001, Accounting Standards and Interpretations, and complies with other
requirements of the law.
The financial report includes the consolidated financial statements of the group.
Accounting Standards include Australian Accounting Standards. Compliance with Australian
Accounting Standards ensures that the financial statements and notes of the Consolidated Group
comply with International Financial Reporting Standards (‘IFRS’). The Consolidated Group is a for-
profit entity for the purpose of preparing the financial statements.
The financial statements were authorised for issue by the directors on 31 March 2021.
Basis of preparation
The financial report has been prepared on the basis of historical cost, except for the revaluation of
certain non-current assets and financial instruments. Cost is based on the fair values of the
consideration given in exchange for assets. All amounts are presented in Australian dollars, unless
otherwise noted.
The Company is a company of the kind referred to in ASIC Corporations instrument 2016/191, dated
24 March 2016, and in accordance with that Instrument, amounts in the financial report are rounded
off to the nearest thousand dollars, unless otherwise indicated.
Critical accounting judgments and key sources of estimation uncertainty
In the application of the Consolidated Group’s accounting policies, management is required to make
judgments, estimates and assumptions about carrying values of assets and liabilities that are not
readily apparent from other sources. The estimates and associated assumptions are based on
historical experience and other factors that are considered to be relevant. Actual results may differ
from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to
accounting estimates are recognised in the period in which the estimate is revised if the revision
affects only that period or in the period of the revision and future periods if the revision affects both
current and future periods. Refer to note 3 for a discussion of critical judgements in applying the
entity’s accounting policies, and key sources of estimation uncertainty.
Adoption of new and revised Accounting Standards
The Consolidated Group has adopted all new and revised Standards and Interpretations issued by
the Australian Accounting Standards Board (“AASB”) that are relevant to the Consolidated Group’s
operations and effective for the year end.
The adoption of these standards and interpretations did not have a material impact on the
Consolidated Group.
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GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
Notes to the accounts
2. Significant accounting policies (cont’d)
Date issued
Standard/Interpretation
Effective for annual
reporting periods
beginning on or after
4 December 2018
Accounting Standards – Definition of a business
1 January 2020
AASB 2018-6 Amendements to Australian
5 December 2019
May 2019
December 2019
AASB 2018-7 Amendments to Australian
Accounting Standards – Definition of Material
Conceptual Framework for Financial Reporting
and AASB 2019-1 Amendments to Australian
Accounting Standards – References to Conceptual
Framework
AASB 2019-5 Amendments to Australian
Accounting Standards – Disclosure of the Effects
of New IFRS Standards Not Yet Issued in
Australia
1 January 2020
1 January 2020
1 January 2020
The Consolidated Group has not elected to early adopt any new standards or amendments and do
not expect the adoption of these standards/interpretations to have a material impact on the financial
statements in future periods.
The following significant accounting policies have been adopted in the preparation and presentation of
the financial report:
(a) Basis of consolidation
The consolidated financial statements incorporate the financial statements of the Company and
entities (including special purpose entities) controlled by the Company (its subsidiaries). Control
is achieved where the Company has the power to govern the financial and operating policies of
an entity so as to obtain benefits from its activities.
The results of subsidiaries acquired or disposed of during the year are included in the
consolidated statement of comprehensive income from the effective date of acquisition and up
to the effective date of disposal, as appropriate.
Where necessary, adjustments are made to the financial statements of subsidiaries to bring
their accounting policies into line with those used by other members of the Consolidated Group.
All intra-group transactions, balances, income and expenses are eliminated in full on
consolidation.
Non-controlling interests in subsidiaries are identified separately from the Group’s equity
therein. The interests of non-controlling shareholders may be initially measured either at fair
value or at the non-controlling interests’ proportionate share of the fair value of the acquiree’s
identifiable net assets. The choice of measurement basis is made on an acquisition-by-
acquisition basis. Subsequent to acquisition, the carrying amount of non-controlling interests is
the amount of those interests at initial recognition plus the non-controlling interests’ share of
subsequent changes in
equity. Total comprehensive income is attributed to non-controlling interests even if this results
in the non-controlling interests having a deficit balance.
Changes in the Consolidated Group’s interests in subsidiaries that do not result in a loss of
control are accounted for as equity transactions. The carrying amounts of the Consolidated
Group’s interests and the non-controlling interests are adjusted to reflect the changes in their
relative interests in the subsidiaries. Any difference between the amount by which the non-
controlling interests are adjusted and the fair value of the consideration paid or received is
recognised directly in equity and attributed to owners of the Company.
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43
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
Notes to the accounts
2. Significant accounting policies (cont’d)
(b) Foreign currency
The individual financial statements of each group entity are presented in its functional currency
being the currency of the primary economic environment in which the entity operates. For the
purpose of the consolidated financial statements, the results and financial position of each entity
are expressed in Australian dollars, which is the functional currency of Greenland Minerals
Limited and the presentation currency for the consolidated financial statements.
In preparing the financial statements of the individual entities, transactions in currencies other
than the entity’s functional currency are recorded at the rates of exchange prevailing on the
dates of the transactions. At each balance sheet date, monetary items denominated in foreign
currencies are retranslated at the rates prevailing at the balance sheet date. Non-monetary
items carried at fair value that are denominated in foreign currencies are retranslated at the
rates prevailing on the date when the fair value was determined. Non-monetary items that are
measured in terms of historical cost in a foreign currency are not retranslated.
Exchange differences are recognised in profit or loss in the period in which they arise except for:
•
exchange differences on monetary items receivable from or payable to a foreign
operation for which settlement is neither planned or likely to occur, which form part of
the net investment in a foreign operation, and which are recognised in the foreign
currency translation reserve and recognised in profit or loss on disposal of the net
investment.
On consolidation, the assets and liabilities of the Consolidated Group’s foreign operations are
translated into Australian dollars at exchange rates prevailing on the balance sheet date.
Income and expense items are translated at the average exchange rates for the period, unless
exchange rates fluctuated significantly during that period, in which case the exchange rates at
the dates of the transactions are used. Exchange differences arising, if any, are classified as
equity and transferred to the Consolidated Group’s foreign currency translation reserve. Such
exchange differences are recognised in profit or loss in the period in which the foreign operation
is disposed.
(c) Goods and services tax
Revenues, expenses and assets are recognised net of the amount of goods and services tax
(GST), except:
i.
where the amount of GST incurred is not recoverable from the taxation authority, it is
recognised as part of the cost of acquisition of an asset or as part of an item of expense;
or
for receivables and payables which are recognised inclusive of GST.
ii.
The net amount of GST recoverable from, or payable to, the taxation authority is included as
part of receivables or payables.
Cash flows are included in the cash flow statement on a gross basis. The GST component of
cash flows arising from investing and financing activities which is recoverable from, or payable
to, the taxation authority is classified within operating cash flows.
(d) Revenue
Revenue is recognised when control of a good or service transfers to a customer.
Interest revenue
Interest revenue is recognised by reference to the principal outstanding and at the effective
interest rate applicable, which is the rate that exactly discounts estimated future cash receipts
through the expected life of the financial asset to that asset’s net carrying amount.
Rental income
Revenue from operating sub-leases is recognised as income at the commencement of the
relevant rental period.
Government assistance
Government assistance is not recognised until there is reasonable assurance that the Group will
comply with the conditions attaching to them and that the assistance will be received.
44
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GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
Notes to the accounts
2. Significant accounting policies (cont’d)
The assistance amounts are recognised in profit or loss on a systematic basis over the periods
in which the Group recognises as expenses the related costs for which the assistances are
intended to compensate. Amounts that are receivable as compensation for expenses or losses
already incurred or for the purpose of giving immediate financial support to the Group with no
future related costs are recognised in profit or loss in the period in which they become
receivable.
(e) Share-based payments
Equity-settled share-based payments with employees and others providing similar services are
measured at the fair value of the equity instrument at the grant date. Fair value is measured by
use of an appropriate valuation method. The expected life used in the model has been adjusted,
based on management’s best estimate, for the effects of non-transferability, exercise
restrictions, and behavioural considerations. Further details on how the fair value of equity-
settled share-based transactions are in note 25.
The fair value determined at the grant date of the equity-settled share-based payments is
expensed on a straight-line basis over the vesting period, based on the Consolidated Group’s
estimate of equity instruments that will eventually vest.
At each reporting date, the Consolidated Group revises its estimate of the number of equity
instruments expected to vest. The impact of the revision of the original estimates, if any, is
recognised in profit or loss over the remaining vesting period, with corresponding adjustment to
the equity-settled employee benefits reserve.
Equity-settled share-based payment transactions with other parties are measured at the fair
value of the goods and services received, except where the fair value cannot be estimated
reliably, in which case they are measured at the fair value of the equity instruments granted,
measured at the date the entity obtains the goods or the counterparty renders the service.
(f)
Income tax
Current tax
Current tax is calculated by reference to the amount of income taxes payable or recoverable in
respect of the taxable profit or tax loss for the period. It is calculated using tax rates and tax laws
that have been enacted or substantively enacted by reporting date. Current tax for current and
prior periods is recognised as a liability (or asset) to the extent that it is unpaid (or refundable).
Deferred tax
Deferred tax is accounted for using the balance sheet liability method. Temporary differences
are differences between the tax base of an asset or liability and its carrying amount in the
balance sheet. The tax base of an asset or liability is the amount attributed to that asset or
liability for tax purposes.
In principle, deferred tax liabilities are recognised for all taxable temporary differences. Deferred
tax assets are recognised to the extent that it is probable that sufficient taxable amounts will be
available against which deductible temporary differences or unused tax losses and tax offsets
can be utilised. However, deferred tax assets and liabilities are not recognised if the temporary
differences giving rise to them arise from the initial recognition of assets and liabilities (other
than as a result of a business combination) which affects neither taxable income nor accounting
profit. Furthermore, a deferred tax liability is not recognised in relation to taxable temporary
differences arising from the initial recognition of goodwill.
Deferred tax liabilities are recognised for taxable temporary differences associated with
investments in subsidiaries and interests in joint ventures except where the Consolidated Group
is able to control the reversal of the temporary differences and it is probable that the temporary
differences will not reverse in the foreseeable future. Deferred tax assets arising from deductible
temporary differences associated with these investments and interests are only recognised to
the extent that it is probable that there will be sufficient taxable profits against which to utilise the
benefits of the temporary differences and they are expected to reverse in the foreseeable future.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the
period(s) when the asset and liability giving rise to them are realised or settled, based on tax
rates (and tax laws) that have been enacted or substantively enacted by reporting date.
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GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
Notes to the accounts
2. Significant accounting policies (cont’d)
The measurement of deferred tax liabilities and assets reflects the tax consequences that would
follow from the manner in which the Consolidated Group expects, at the reporting date, to
recover or settle the carrying amount of its assets and liabilities.
Deferred tax assets and liabilities are offset when they relate to income taxes levied by the
same taxation authority and the Company/Consolidated Group intends to settle its current tax
assets and liabilities on a net basis.
Current and deferred tax for the period
Current and deferred tax is recognised in profit or loss, except when it relates to items credited
or debited directly to equity, in which case the deferred tax is also recognised directly in equity,
or where it arises from the initial accounting for a business combination, in which case it is taken
into account in the determination of goodwill or excess.
(g) Cash and cash equivalents
Cash comprises cash on hand and demand deposits. Cash equivalents are short-term, highly
liquid investments that are readily convertible to known amounts of cash, which are subject to
an insignificant risk of changes in value and have a maturity of three months or less at the date
of acquisition.
(h) Financial assets
Financial assets are classified, at initial recognition, as subsequently measured amortised cost,
fair value through other comprehensive income (“OCI”), or fair value through profit and loss.
The classification of financial assets at initial recognition depends on the financial asset’s
contractual cash flow characteristics and the Consolidated Group’s business model for
managing them. The Consolidated Group initially measures a financial asset at its fair value
plus, in the case of financial asset not at fair value through the profit or loss, transaction costs.
In order for a financial asset to be classified and measured at amortised costs or fair value
through OCI, it needs to give rise to cash flows that are solely payments of principal and interest
on the principal amount outstanding. This assessment is referred to the SPPI test and is
performed at an instrument level.
The Consolidated Group’s business model for managing financial assets refers to how it
manages its financial assets in order to generate cash flows. The business model determines
whether cash flows will result from collecting contractual cash flow, selling the financial assets or
both.
Financial assets are recognised at amortised cost are subsequently measured using the
effective interest method and are subject to impairment. Gains and losses are recognised in
profit or loss when the asset is derecognised, modified or impaired.
Upon initial recognition, the Consolidated Group can elect to classify irrevocably its equity
investments as equity investments designated at fair value through OCI when they meet the
definition of equity under IAS 32 Financial Instruments: Presentation and are not held for
trading. The classification is determined on an instrument by instrument basis.
Gains and losses on these financial assets are never recycled to profit and loss. Dividends are
recognised as other income in the Statement of Profit and Loss when the right of payment has
been established, except when the Consolidated Group benefits from such proceeds as a
recovery of part of the cost of the financial asset, in which case, such gains are recorded to OCI.
Equity instruments designated at fair value through OCI are not subject to impairment
assessment.
Financial assets at fair value through profit and loss are carried in the Statement of Financial
Position at fair value with net changes in fair value recognised in the Statement of Profit and
Loss. Typically, such financial assets will be either: (i) held for trading, where they are acquired
for the purpose of selling in the short term with an intention of making a profit, or a derivative, or
(ii) designated as such upon initial recognition where permitted.
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GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
Notes to the accounts
2. Significant accounting policies (cont’d)
Impairment of financial assets
The Consolidated Group recognises an allowance for expected credit losses (“ECL”) for any
debt instrument not held at fair value through profit and loss. All ECLs are based on the
difference between the contractual cash flows due in accordance with the contract and cash
flows that the Consolidated Group expects to receive, discounted at an approximation of the
original interest rate. The expected cash flows will include cash flows from the sale of collateral
held or other credit enhancements that are integral to the contractual terms.
ECLs are recognised in two stages. For credit exposure for which there has not been a
significant increase in credit risk since initial recognition, ECLs are provided for credit losses that
result from default events that are possible within the next 12 months. For those credit
exposures for which there has been a significant increase in credit risk since recognition, a loss
allowance is required for credit losses expected over the remaining life of the exposure,
irrespective of the timing of the default.
At each reporting date, the Consolidated Group assesses whether there is any indication that an
asset may be impaired. Where an indicator of impairment exists, the Consolidated Group makes
a formal estimate of the recoverable amount. Where the carrying amount of an asset exceeds
its expected recoverable cash flows the asset is considered impaired and written down to its
recoverable amount.
(i) Property, plant and equipment
Plant and equipment and leasehold improvements are stated at cost less accumulated
depreciation and impairment. Cost includes expenditure that is directly attributable to the
acquisition of the item. In the event that settlement of all or part of the purchase consideration is
deferred, cost is determined by discounting the amounts payable in the future to their present
value as at the date of acquisition.
Depreciation on plant and equipment is calculated on a diminishing value basis so as to write off
the net cost or other devalued amount of each asset over its expected useful life to its estimated
residual value. Leasehold improvements are depreciated over the period of the lease or
estimated useful life, whichever is the shorter, using the diminishing value method. The
estimated useful lives, residual values and depreciation method are reviewed at the end of each
annual reporting period, with the effect of any changes recognised on a prospective basis. Right
of use assets are depreciated on a straight line method, over the period of the lease.
The gain or loss arising on disposal or retirement of an item of property, plant and equipment is
determined as the difference between the sales proceeds and the carrying amount of the asset
and is recognised in profit or loss.
The following useful lives are used in the calculation of depreciation:
Leasehold improvements
Plant and equipment
Buildings
Right-of-use assets
10 – 15 years
4 – 10 years
20 years
1-4 years
(j) Leases
The Group assesses whether a contract is or contains a lease, at inception of the contract. The
Group recognises a right-of-use asset and a corresponding lease liability with respect to all
lease arrangements in which it is the lessee, except for short-term leases (defined as leases
with a lease term of 12 months or less) and leases of low value assets (such as tablets and
personal computers, small items of office furniture and telephones). For these leases, the
Group recognises the lease payments as an operating expense on a straight-line basis over the
term of the lease unless another systematic basis is more representative of the time pattern in
which economic benefits from the leased assets are consumed.
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47
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GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Notes to the accounts
2. Significant accounting policies (cont’d)
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
The lease liability is initially measured at the present value of the lease payments that are not
paid at the commencement date, discounted by using the rate implicit in the lease. If this rate
cannot be readily determined, the Group uses its incremental borrowing rate. Lease payments
included in the measurement of the lease liability comprise :
•
•
•
•
•
Fixed lease 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;
The amount expected to be payable by the lessee under residual value guarantees;
The exercise price of purchase options, if the lessee is reasonably certain to exercise
the options; and
Payments of penalties for terminating the lease, if the lease term reflects the exercise
of an option to terminate the lease.
The lease liability is presented as a separate line in the consolidated statement of financial
position.
The lease liability is subsequently measured by increasing the carrying amount to reflect
interest on the lease liability (using the effective interest method) and by reducing the carrying
amount to reflect the lease payments made. The Group remeasures the lease liability (and
makes a corresponding adjustment to the related right-of-use asset) whenever:
•
•
•
The lease term has changed or there is a significant event or change in
circumstances resulting in a change in the assessment of exercise of a purchase
option, in which case the lease liability is remeasured by discounting the revised
lease payments using a revised discount rate.
The lease payments change due to changes in an index or rate or a change in
expected payment under a guaranteed residual value, in which cases the lease
liability is remeasured by discounting the revised lease payments using an
unchanged discount rate (unless the lease payments change is due to a change in a
floating interest rate, in which case a revised discount rate is used).
A lease contract is modified and the lease modification is not accounted for as a
separate lease, in which case the lease liability is remeasured based on the lease
term of the modified lease by discounting the revised lease payments using a revised
discount rate at the effective date of the modification.
The right-of-use assets comprise the initial measurement of the corresponding lease liability,
lease payments made at or before the commencement day, less any lease incentives received
and any initial direct costs. They are subsequently measured at cost less accumulated
depreciation and impairment losses.
Whenever the Group incurs an obligation for costs to dismantle and remove a leased asset,
restore the site on which it is located or restore the underlying asset to the condition required by
the terms and conditions of the lease, a provision is recognised and measured under IAS 37.
To the extent that the costs relate to a right-of-use asset, the costs are included in the related
right-of-use asset, unless those costs are incurred to produce inventories.
Right-of-use assets are depreciated over the shorter period of lease term and useful life of the
right-of-use asset. If a lease transfers ownership of the underlying asset or the cost of the right-
of-use asset reflects that the Group expects to exercise a purchase option, the related right-of-
use asset is depreciated over the useful life of the underlying asset. The depreciation starts at
the commencement date of the lease.
The right-of-use assets are presented as a separate line in the consolidated statement of
financial position.
The Group applies IAS 37 Provisions, Contingent Liabilities and Contingent Assets to
determine whether a right-of-use asset is impaired and accounts for any identified impairment
loss as described in the ‘Impairment of long-lived assets excluding goodwill’ policy.
48
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GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
Notes to the accounts
2. Significant accounting policies (cont’d)
Variable rents that do not depend on an index or rate are not included in the measurement the
lease liability and the right-of-use asset. The related payments are recognised as an expense in
the period in which the event or condition that triggers those payments occurs and are included
in the line “Other expenses” in profit or loss.
(k) Employee benefits
A liability is recognised for benefits accruing to employees in respect of wages and salaries,
annual leave, long service leave, and sick leave when it is probable that settlement will be
required and they are capable of being measured reliably. Liabilities recognised in respect of
short-term employee benefits, are measured at their nominal values using the remuneration rate
expected to apply at the time of settlement.
Liabilities recognised in respect of long-term employee benefits, are measured as the present
value of the estimated future cash outflows to be made by the Consolidated Group in respect of
services provided by employees up to reporting date.
(l)
Financial instruments issued by the Consolidated Group
Debt and equity instruments
Debt and equity instruments are classified as either liabilities or as equity in accordance with the
substance of the contractual arrangement. An equity instrument is any contract that evidences a
residual interest in the assets of an entity after deducting all of its liabilities. Equity instruments
issued by the Consolidated Group are recorded at the proceeds received, net of direct issue
costs.
Financial liabilities
Financial liabilities are classified as either ‘other financial liabilities’ or are irrevocably designated
as ‘fair value through profit or loss’.
Other financial liabilities
Other financial liabilities, including borrowings, are initially measured at fair value, net of
transaction costs.
Other financial liabilities are subsequently measured at amortised cost using the effective
interest method, with interest expense recognised on an effective yield basis.
The effective interest method is a method of calculating the amortised cost of a financial liability
and of allocating interest expense over the relevant period. The effective interest rate is the rate
that exactly discounts estimated future cash payments through the expected life of the financial
liability, or, where appropriate, a shorter period.
(m) Impairment of long-lived assets excluding goodwill
At each reporting date, the Consolidated Group reviews the carrying amounts of its assets to
determine whether there is any indication that those assets have suffered an impairment loss. If
any such indication exists, the recoverable amount of the asset is estimated in order to
determine the extent of the impairment loss (if any). Where the asset does not generate cash
flows that are independent from other assets, the Consolidated Group estimates the recoverable
amount of the cash-generating unit to which the asset belongs. Where a reasonable and
consistent basis of allocation can be identified, corporate assets are also allocated to individual
cash-generating units, or otherwise they are allocated to the smallest group of cash-generating
units for which a reasonable and consistent allocation basis can be identified.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing
value in use, the estimated future cash flows are discounted to their present value using a pre-
tax discount rate that reflects current market assessments of the time value of money and the
risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its
carrying amount, the carrying amount of the asset (cash-generating unit) is reduced to its
recoverable amount. An impairment loss is recognised immediately in profit or loss.
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49
49
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
Notes to the accounts
2. Significant accounting policies (cont’d)
Where an impairment loss subsequently reverses, the carrying amount of the asset (cash-
generating unit) is increased to the revised estimate of its recoverable amount, but only to the
extent that the increased carrying amount does not exceed the carrying amount that would have
been determined had no impairment loss been recognised for the asset (cash-generating unit)
in prior years. A reversal of an impairment loss is recognised immediately in profit or loss.
(n) Capitalisation of exploration and evaluation expenditure
Exploration and evaluation expenditures in relation to each separate area of interest are
recognised as an exploration and evaluation asset in the year in which they are incurred where
the following conditions are satisfied:
(i) the rights to tenure of the area of interest are current; and
(ii) at least one of the following conditions is also met:
(a)
(b)
the exploration and evaluation expenditures are expected to be recouped through
successful development and exploration of the area of interest, or alternatively, by its
sale; or
exploration and evaluation activities in the area of interest have not, at the reporting
date, reached a stage which permits a reasonable assessment of the existence or
otherwise of economically recoverable reserves, and active and significant operations
in, or in relation to, the area of interest are continuing.
Exploration and evaluation assets are initially measured at cost and include acquisition of rights
to explore, studies, exploratory drilling, trenching and sampling and associated activities and an
allocation of depreciation and amortisation of assets used in exploration and evaluation
activities. General and administrative costs are only included in the measurement of exploration
and evaluation costs where they are related directly to operational activities in a particular area
of interest.
Exploration and evaluation assets are assessed for impairment when facts and circumstances
suggest that the carrying amount of an exploration and evaluation asset may exceed its
recoverable amount. The recoverable amount of the exploration and evaluation asset (or the
cash-generating unit(s) to which it has been allocated, being no larger than the relevant area of
interest) is estimated to determine the extent of the impairment loss (if any). Where an
impairment loss subsequently reverses, the carrying amount of the asset is increased to the
revised estimate of its recoverable amount, but only to the extent that the increased carrying
amount does not exceed the carrying amount that would have been determined had no
impairment loss been recognised for the asset in previous years.
Where research and development (“R&D”) rebates are claimed on eligible expenditure, these
are offset against the capitalised exploration and evaluation expenditure asset to the extent that
the associated expenditure was also capitalised as such. Where the associated expenditure
has been expensed, the R&D rebate is also recognised within the Statement of Profit or Loss.
Where a decision is made to proceed with development in respect of a particular area of
interest, the relevant exploration and evaluation asset is tested for impairment and the balance
is then reclassified to development.
(o) Provisions
Provisions are recognised when the Consolidated Group has a present obligation (legal or
constructive) as a result of a past event, it is probable that the Consolidated Group will be
required to settle the obligation, and a reliable estimate can be made of the amount of the
obligation.
The amount recognised as a provision is the best estimate of the consideration required to
settle the present obligation at reporting date, taking into account the risks and uncertainties
surrounding the obligation. Where a provision is measured using the cashflows estimated to
settle the present obligation, its carrying amount is the present value of those cashflows.
50
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GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
Notes to the accounts
2. Significant accounting policies (cont’d)
When some or all of the economic benefits required to settle a provision are expected to be
recovered from a third party, the receivable is recognised as an asset if it is virtually certain that
reimbursement will be received and the amount of the receivable can be measured reliably.
3: Critical accounting estimates and judgments
In preparing this Financial Report the Consolidated Group has been required to make certain
estimates and assumptions concerning future occurrences. There is an inherent risk that the resulting
accounting estimates will not equate exactly with actual events and results.
a)
Significant accounting judgments
In the process of applying the Consolidated Group's accounting policies, management has
made the following judgments, apart from those involving estimations, which have the most
significant effect on the amounts recognised in the financial statements:
Carrying value of exploration and evaluation expenditure
The Consolidated Group has capitalised significant exploration and evaluation expenditure on
the basis either that this is expected to be recouped through future successful development or
alternatively sale of the Areas of Interest. If ultimately the area of interest is abandoned or is
not successfully commercialised, the carrying value of the capitalised exploration and
evaluation expenditure would be written down to its recoverable amount.
Deferred tax assets
The Consolidated Group expects to have carried forward tax losses which have not been
recognised as deferred tax assets as it is not considered sufficiently probable at this point in
time, that these losses will be recouped by means of future profits taxable in the relevant
jurisdictions.
b)
Significant accounting estimates and assumptions
The carrying amounts of certain assets and liabilities are often determined based on estimates
and assumptions of future events. The key estimates and assumptions that have a significant
risk of causing a material adjustment to the carrying amounts of certain assets and liabilities
within the next annual reporting period are:
Carrying value of capitalised exploration and evaluation expenditure
The future recoverability of capitalised exploration and evaluation expenditure is dependent on
a number of factors, including whether the Consolidated 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 and
political changes, (including obtaining the right to mine and changes to environmental
restoration obligations) and changes to commodity prices.
As at 31 December 2020, the carrying value of capitalised exploration expenditure is
$89,343,422 (2019: $85,886,253) refer to note 13 and note 32.
Share-based payments
Equity-settled share-based payments with employees and others providing similar services are
measured at the fair value of the equity instrument at the grant date. Fair value is measured by
use of an appropriate valuation method. The expected life used in the model has been adjusted,
based on management’s best estimate, for the effects of non-transferability, exercise
restrictions,
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51
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GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
Notes to the accounts
4: Segment information
AASB8 Operating Segments requires operating segments to be identified on the basis of internal
reports about components of the entity that are regularly reviewed by the managing director (chief
operating decision maker) in order to allocate resources to the segment and assess performance.
The Consolidated Group undertakes mineral exploration and evaluation in Greenland.
Given the Consolidated Group has one reporting segment, operating results and financial information
are not separately disclosed in this note.
5: Revenue
Interest - Bank deposits
Other revenue
Government grants
6: Expenditure
(a) Director and employee benefits
Directors’ fees
Director’s and employee salary and wage expense
Director’s share based payments
Employee share based payments
Director’s and employee post-employment benefits
(b) Professional fees:
Audit, accounting and taxation expense
Legal fees
Marketing and public relations
Consulting
Share based payment (refer to note 25)
(c)
Listing costs:
Stock exchange fees
Share registry fees
31 Dec
2020
$' 000
31 Dec
2019
$' 000
37
4
117
158
64
-
-
64
31 Dec
2020
$' 000
31 Dec
2019
$' 000
(199)
(637)
-
(827)
(65)
(199)
(827)
275
(554)
(65)
(1,728)
(1,370)
(151)
(57)
(401)
-
(200)
(809)
(69)
(50)
(119)
(158)
(22)
(440)
(4)
-
(624)
(71)
(43)
(114)
Page | 44
52
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
Notes to the accounts
6: Expenditure (cont’d)
(d)
Finance Costs
Interest expense – lease assets
(e) Other expenses
Depreciation expense – property, plant & equipment
Depreciation expense – leased assets
Insurance
Travel expenses
Other expenses
7: Income tax
(a) Tax expense
Current tax
Deferred tax
b) The prima facie income tax benefit on pre-tax accounting
loss from operations reconciles to the income tax expenses
in the financial statements as follows:
Loss for period
Prima facie tax benefit on loss at 30% (2019: 30%)
Add/(Deduct)
Tax effect of:
Non-assessable, non-exempt (NANE) expenditure
Share based payments
Movement in deferred tax balance not recognised
Change in tax rate and difference in tax rate
31 Dec
2020
$' 000
31 Dec
2019
$' 000
(24)
(24)
(70)
(180)
(63)
(64)
(177)
(554)
(29)
(29)
(74)
(178)
(58)
(110)
(358)
(778)
31 Dec
2020
$' 000
31 Dec
2019
$' 000
-
-
-
-
-
-
-
-
(3,076)
(923)
(2,851)
(855)
281
248
(1,784)
332
-
84
(939
-
Income tax expense
(923)
(855)
Page | 45
53
53
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Notes to the accounts
7: Income tax (cont’d)
The following deferred tax balances have not been
recognised:
Deferred tax assets:
Australian tax losses
Greenland tax losses (at 25% (2019: 30%))
Other accruals and provisions
Less: offset against deferred tax liability
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
31 Dec
2020
$' 000
31 Dec
2019
$' 000
9,992
21,950
419
32,361
(23,013)
9,348
9,589
24,981
138
34,708
(18,335)
16,373
The above deferred tax assets will only be recognised when:
(i)
(ii)
(iii)
The Consolidated Group derives future assessable income of a nature and amount sufficient
to enable the benefits to be utilised,
The Consolidated Group continues to comply with the conditions of deductibility imposed by
law, and
No change in income tax legislation adversely affects the Consolidated Group’s ability to
utilise the benefits.
Deferred tax liabilities:
Exploration, evaluation and development expenditure
(at 25%/30% (2019: 30%))
Other
less offset against deferred tax assets
8: Cash and equivalents
Cash at bank
Cash on deposit at call
Cash on deposit
31 Dec
2020
$' 000
31 Dec
2019
$' 000
22,812
201
23,013
(23,013)
18,332
3
18,335
(18,355)
-
-
Dec
2020
$' 000
495
33,575
2,368
36,438
Dec
2019
$' 000
385
5,868
2,346
8,599
The Consolidated Group’s financial risk management objectives and policies are discussed further at
note 26.
54
Page | 46
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Notes to the accounts
9: Trade and other receivables
Accrued interest
GST refundable
Research and development tax rebate
10: Other assets
Deposit bonds
Prepayments
11: Property, plant and equipment
Plant and Equipment (cost)
Accumulated depreciation
Buildings (cost)
Accumulated depreciation
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
Dec
2020
$' 000
Dec
2019
$' 000
1
184
-
185
Dec
2020
$' 000
Dec
2019
$' 000
10
83
93
7
40
667
714
9
77
86
Dec
2020
$' 000
Dec
2019
$' 000
1,349
(1,129)
939
(398)
761
1,335
(1,116)
934
(368)
785
(a) Movements in the carrying amounts
Movement in the carrying values for each class of property, plant and equipment between the
beginning and the end of the period.
Page | 47
55
55
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
Notes to the accounts
11: Property, plant and equipment (cont’d)
Plant and Equipment
Carrying value at beginning of year
Acquisitions
Disposals
Effects of currency translation
Depreciation expense
Carrying value at end of year
Buildings
Carrying value at the beginning of year
Effects of currency translation
Depreciation
Carrying value at end of year
Total property, plant and equipment carrying value at end of
period
12: Right-of-use assets
Balance at beginning of year
Additions
Depreciation
Balance at end of year
(i)
Recognition of property leases in accordance with AASB 16.
13: Capitalised exploration and evaluation expenditure
Balance at beginning of year
Exploration and/or evaluation phase in
current period:
Capitalised expenses
Effects of currency translation (i)
Research and development tax rebate
Balance at end of year
Dec
2020
$' 000
Dec
2019
$' 000
219
42
-
-
(41)
220
566
4
(29)
541
761
258
11
(3)
(2)
(45)
219
605
(10)
(29)
566
785
Dec
2020
$' 000
Dec
2019
$' 000
522
106
(180)
448
700
-
(178)
522
Dec
2020
$' 000
Dec
2019
$' 000
85,886
85,292
3,145
312
-
89,343
2,506
(1,245)
(667)
85,886
56
Page | 48
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
Notes to the accounts
13: Capitalised exploration and evaluation expenditure (cont’d)
(i)
(ii)
(iii)
(iv)
The Kvanefjeld Project EL 2010/02 is held by Greenland Minerals A/S, the 100% owned
Greenlandic subsidiary. All capitalised exploration and evaluation expenditure has been
recognised in the Greenlandic subsidiary and at reporting date has been translated at the
closing Australian dollar/Danish kroner exchange rate with the movement being recognised in
the foreign currency translation reserve.
The recoverability of the Consolidated Group’s carrying value of the capitalised exploration
and evaluation expenditure relating to EL 2010/02 is subject to the successful development
and exploitation of the exploration property. The Consolidated Group has completed a
feasibility study and environmental and social impact studies.
The Greenland government, after an extensive review and consultation process approved the
Consolidated Group’s environmental and social impact assessments and marine safety study
as meeting the required legislative requirements and being acceptable for public consultation.
The statutory public consultation commenced on 17 December 2020 and scheduled for an
initial 12 week period. The Greenland government extended this to a 23 week period in
February 2021 due to COVID-19 travel restrictions.
The Consolidated Group is working with the Greenland Government and other stakeholders
to progress the mining license application to move to development in accordance with both
Greenland Government and local community expectations. Future changes to government
policy may have an impact on the permitting process.
14: Trade and other payables
Accrued expenses (i)
Trade creditors (ii)
Sundry creditors (ii)
Dec
2020
$' 000
Dec
2019
$' 000
358
754
147
1,259
742
121
78
941
(i)
(ii)
(iii)
Accrued expenses related to services and goods provided to the Consolidated Group prior to
the period end, but the Consolidated Group was not charged or invoiced for these goods and
services by the supplier at period end. The amounts are generally payable and paid within 30
days and are non-interest bearing.
Trade and sundry creditors are non-interest bearing with the exception of amounts owed on
corporate credit cards and after 30 days interest is charged at rates ranging between 15%
and 18%. All trade and sundry creditors are generally payable on terms of 30 days.
The financial risk related to trade and other payables is managed by ensuring sufficient at call
cash balances are maintained by the Consolidated Group to enable the settlement in full of all
amounts as and when they become due for payment.
Page | 49
57
57
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Notes to the accounts
15: Lease Liability
(a) Current
Balance at beginning of year
Interest on lease liabilities
Lease repayments
Lease additions
Transfer from Non-current to current
Balance at end of year
(b) Non-current
Balance at beginning of year
Lease additions
Transfer from Non-current to current
Balance at end of year
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
Dec
2020
$' 000
Dec
2019
$' 000
138
24
(188)
34
180
188
410
72
(180)
302
152
29
(181)
-
138
138
548
-
(138)
410
The undiscounted maturity analysis of lease liabilities
Within
1 year
$' 000
1-2
Years
$' 000
2-3
Years
$' 000
3-4
Years
$' 000
4-5
Years
$' 000
31 December 2020
Lease payments
Finance charges
Net present value
31 December 2019
Lease payments
Finance charges
Net present value
16: Provisions
(a) Current
Provision for annual leave
Provision for long service leave
(b) Non-current
Provision for long service leave
205
(17)
188
160
(25)
138
158
(10)
148
150
(16)
134
136
(4)
132
132
(10)
122
23
(1)
22
136
(4)
132
Dec
2020
$' 000
Dec
2019
$' 000
553
150
703
44
44
-
-
-
23
(1)
22
441
-
441
172
172
58
Page | 50
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
Notes to the accounts
17: Issued capital
Changes to the then Corporations Law abolished the authorised capital and par value concept in
relation to share capital from 1 July 1998. Therefore, the Consolidated Group does not have a limited
amount of authorised capital and issued shares do not have a par value.
Fully paid ordinary shares carry one vote per share and carry the right to dividends.
Balance brought forward
Issue of ordinary shares through capital
raising
$0.15 exercise price options
Vesting of employee performance rights
Less costs associated with shares issued
Balance at end of financial year
18: Reserves
Dec 2020
Dec 2019
No
' 000
1,190,982
141,695
319
6,075
-
1,339,071
$' 000
371,808
34,007
65
870
(2,062)
404,688
No
' 000
1,132,649
58,333
-
-
-
1,190,982
$' 000
365,247
7,000
-
-
(439)
371,808
a) Option reserve
Balance brought forward
Recognition of performance rights - director
Recognition of performance rights - employees
Recognition of share based payments - consultants
Transfer of value of options exercised
Transfer of values of vested employee performance rights
Balance at end of financial year
(i) Refer to note 25 for further information.
Dec
2020
$' 000
Dec
2019
$' 000
883
-
827
200
(18)
(870)
1,022
604
(275)
554
-
-
-
883
The option reserve arises from the grant of share options attached to shares issued under rights
issues, and share options and performance rights to executives, employees and consultants.
Amounts are transferred out of the reserve and into issued capital when the options are exercised.
Further information about share-based payments to directors and senior management is made in note
25 to the financial statements.
b) Foreign currency translation reserve
Balance brought forward
Current period adjustment from currency translation of foreign
controlled entities
Balance at end of year
Dec
2020
$' 000
7,236
339
7,575
Dec
2019
$' 000
8,503
(1,267)
7,236
Page | 51
59
59
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
Notes to the accounts
The foreign currency translation reserve records the foreign currency differences arising from the
translation of the foreign subsidiary’s accounts from Danish Kroner, the functional currency of
Greenland Minerals A/S, to Australian dollars.
c) Non-controlling interest acquisition reserve
Balance brought forward
Balance at end of year
Dec
2020
$' 000
Dec
2019
$' 000
(39,672)
(39,672)
(39,672)
(39,672)
The non-controlling interest acquisition reserve records the acquisition of the non-controlling interests
in Greenland Minerals A/S.
d) Total reserves
Option reserve
Foreign currency translation reserve
Non-controlling interest acquisition reserve
Dec
2020
$' 000
1,022
7,575
(39,672)
(31,075)
Dec
2019
$' 000
883
7,236
(39,672)
(31,553)
19: Dividends
No dividends have been proposed or paid during the year ended 31 December 2020 or the prior year
ended 31 December 2019.
20: Accumulated losses
Balance at beginning of financial year
Loss attributable to members of parent entity
Balance at end of financial year
21: Loss per share
Basic loss per share
From continuing operations
Diluted loss per share
From continuing operations
Dec
2020
$' 000
(245,765)
(3,076)
(248,841)
Dec
2019
$' 000
(242,914)
(2,851)
(245,765)
Dec
2020
Cents
Per share
Dec
2019
Cents
Per share
0.26
0.26
0.25
0.25
Basic and diluted loss per share
The loss and weighted average number of ordinary shares used in the calculation of the basic and
diluted loss per share are as follows;
Loss for year ($)
Weighted average number of shares used
in the calculation of basic and diluted loss
per share (Number)
60
Dec
2020
3,075,972
Dec
2019
2,851,390
1,202,289,119
1,156,302,164
Page | 52
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
Notes to the accounts
21: Loss per share (cont’d)
(i)
There were 16,205,800 potential ordinary shares on issue at 31 December 2020 (31
December 2019: 18,600,000) that are not dilutive and are therefore excluded from the
weighted average number of ordinary shares and potential ordinary shares used in the
calculation of diluted earnings per share.
22: Commitments for expenditure
Exploration commitments: EL 2010/02 is located in Greenland. The tenement expenditure incurred
during the year ended 31 December 2020 and prior years exceeded the minimum expenditure
required to maintain the tenement in good standing. The excess expenditure can be carried forward
for 3 years. The amount carried forward is sufficient to meet the minimum expenditure requirements
over this period.
23: Subsidiaries
Name of subsidiary
Chahood Capital Limited
Greenland Minerals A/S
Country
of incorporation
Isle of Man
Greenland
Ownership interest
Dec
Dec
2019
2020
%
%
100
100
100
100
(i)
Greenland Minerals Limited directly owns 100% of the issued shares of Chahood Capital
Limited. 61% of the issued shares of Greenland Minerals A/S are held by Chahood Capital
Limited and 39% are held directly by Greenland Minerals Limited.
24: Notes to the statement of cash flows
Reconciliation of loss for the year to net cash flows from operating activities.
Loss for the year
Depreciation- property, plant & equipment
Depreciation – leased assets
Equity-settled share-based payments
Interest income received and receivable
(Increase)/decrease in assets
Trade and other receivables
Increase (decrease) in liabilities
Trade and other payables
Provisions
Net cash used in operating activities
Year ended
31 Dec
2020
$' 000
Year ended
31 Dec
2019
$' 000
(3,076)
70
180
1,027
(37)
(133)
291
173
(1,505)
(2,851)
74
178
279
(64)
7
301
49
(2,027)
The Consolidated Group has not entered into any other non-cash financing or investing activities.
Page | 53
61
61
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
Notes to the accounts
25: Share based payments
In addition to share based payments discussed elsewhere within this note, the following unlisted
options were granted as share based payment arrangements during the year ended 31 December
2020:
Option
$0.35 exercise
price
Number
Grant Date
Fair value @
grant date
$
Expiry date
6,000,000
10/12/2020
200,000
31/01/2023
Options were issued in recognition of corporate advisory and investor relations activities that would
have been otherwise payable in cash.
The following unlisted options were exercised during the current year ended 31 December 2020:
Options
$0.15 exercise
price
Opening
balance
Exercised
Expired
Closing Balance
4,000,000
319,200
-
3,680,800
(i)
The weighted average share price at date of exercise was $0.28
No options were exercised during the prior year ended 31 December 2019.
The total options (quoted and unquoted) outstanding as at 31 December 2020 was 9,680,000 as
shown below:
Options
Unlisted options
Unlisted options
Number
3,680,800
6,000,000
Exercise price
$0.15
$0.35
Expiry date
31/03/2021
31/01/2023
Exercisable @
31 Dec 2020
3,680,800
6,000,000
No options expired during the year ended 31 December 2020 or the prior year ended 31 December
2019.
Rights issued
The Company issued 4,000,000 performance rights to Jørn Skov Nielsen during the year ended 31
December 2020, under the Company’s Employee Incentive Plan.
The rights are subject to service period and share price vesting hurdles and were issued to assist with
retaining and incentivising the employee. The rights align with increasing shareholder value. The
rights can only vest into fully paid ordinary shares on satisfying the vesting hurdles prior to 15 August
2024. being the expiry date of the rights.
The following un-vested performance rights were issued during the current financial year ended 31
December 2020:
Jorn Skov
Nielsen
Tranche 1
Tranche 2
Total
Grant date Number
10/08/2020 4,000,000
10/08/2020 2,000,000
4,000,000
Fair value @
grant date
$
469,200
451,000
920,200
Expiry
date
15/08/2024
15/08/2024
Number
vested
Nil
Nil
Nil
62
Page | 54
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
Notes to the accounts
25: Share based payments (cont’d)
The fair value has been established using a binomial model based on the following inputs. The fair
value will be recognised over the determined vesting period, in accordance with Australian Accounting
Standards.
Grant date
Underlying share price at grant date
Maximum life
Expected future volatility
Risk free rate
Share price hurdle (30-day VWAP)
Tranche 1
10 Aug 2020
$0.25
4 Years
75%
0.41%
$0.30
Tranche 2
10 Aug 2020
$0.25
4 Years
75%
0.41%
$0.35
Vesting conditions:
Tranche
Tranche 1
Number
2,000,000
Tranche 2
2,000,000
Service Condition
The employee has to remain
as an employee until 15
August 2022 and remain an
employee at the time of
vesting
The employee has to remain
as an employee until 15
August 2023 and remain an
employee at the time of
vesting
Performance Condition
From grant date and up to 15
August 2024 the Company’s price
based on a 20 trading day
volume weighted average price to
be $0.30 or more
From grant date and up to 15
August 2024 the Company’s price
based on a 20 trading day
volume weighted average price to
be $0.35 or more
The other terms of the Performance Rights are:
(a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)
(i)
Upon satisfaction of the relevant Vesting Conditions, the holder of a Performance
Right may elect to request the Company convert the Performance Rights to fully paid
shares.
The Company will not deny a request to convert a Performance Right to a fully paid
share without due cause.
Each Performance Right will vest and convert into one fully paid share.
(No Consideration payable) No consideration will be payable upon the vesting and
conversion of the Performance Rights.
(No Voting rights) A Performance Right does not entitle a holder to vote on any
resolutions proposed at a general meeting of Shareholders of the Company.
(No dividend rights) A Performance Right does not entitle a holder to any dividends.
(No rights on winding up) A Performance Right does not entitle the holder to
participate in the surplus profits or assets of the Company upon winding up of the
Company.
(Not transferable) A Performance Right is not transferable.
(Reorganisation of capital) If there is a reorganisation (including, without limitation,
consolidation, sub-division, reduction or return) of the issued capital of the Company,
the rights of a holder will be varied, as appropriate, in accordance with the Listing
Rules which apply to reorganisation of capital at the time of the reorganisation.
Page | 55
63
63
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
Notes to the accounts
25: Share based payments (cont’d)
(j)
(k)
(l)
(m)
(n)
(Quotation of Shares on conversion) An application will be made by the Company to
ASX for official quotation of the Shares issued upon the conversion of each
Performance Right within the time period required by the Listing Rules. The Company
will not apply for quotation of the Performance Rights on ASX.
(No participation in entitlements and bonus issues) A Performance Right does not
entitle a holder to participate in new issues of capital offered to holders of Shares,
such as bonus issues and entitlement issues.
(No other rights) A Performance Right does not give a holder any other rights other
than those expressly provided by these terms and those provided at law where such
rights at law cannot be excluded by these terms.
(Lapse) If the Vesting Conditions relevant to a Performance Right have not been
satisfied or have been satisfied but the holder has not elected to request the
Company to covert the Performance Right to fully paid shares by the relevant expiry
date, then the Performance Right will automatically lapse.
Expiry date will be 5:00pm WST on 15 August 2024.
The following performance rights were issued during the previous financial year ended 31 December
2019.
Employee
Grant date
Number
Fair value @
grant date
$
M Guy
Employees
Total
10/07/2019 1,500,000
214,800
10/07/2019 7,100,000
1,016,720
8,600,000
1,231,520
Expiry
date
31/07/2021
31/07/2021
Rights – vested
During the year ended 31 December 2020, the following performance rights satisfied the vesting
conditions, each exercised performance right was converted to one fully paid ordinary share:
Grant
date
KMP
Miles Guy
Employees
Total
Opening
balance
10/07/2019 1,500,000
10/07/2019 7,100,000
8,600,000
Vested
1,500,000
7,100,000
8,600,000
Exercised
1,500,000
4,575,000
6,075,000
Fair value @
grant date
$
214,800
1,016,720
1,231,520
Expiry date
31/07/2021
31/07/2021
Closing
balance
Nil
2,525,000
2,525,000
(i)
(ii)
All rights vested were converted to an equal number of fully paid ordinary shares.
The weighted average share price at date of vesting was $0.28.
No performance rights vested during the prior year ended 31 December 2019.
64
Page | 56
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
Notes to the accounts
25: Share based payments (cont’d)
Rights expired
The following performance rights lapsed during the year ended 31 December 2020:
Director
J Mair
Tranche 1
Tranche 2
Total
Grant
date
31/05/2017
31/05/2017
Number
1,200,000
4,800,000
6,000,000
Fair value @
grant date
$
Expiry
date
Value @ expiry
date
106,800
31/05/2020
384,000
31/05/2020
490,800
Nil
Nil
Nil
The rights were issued in 2 tranches with both tranches being subject to a 12 month service period
and the following share price performance hurdle:
Tranche
Tranche 1
Tranche 2
10 Day VWAP share
price hurdle
Number
$0.182
$0.242
1,200,000
4,800,000
In addition to the share price performance hurdle, tranche 2 is subject to the additional performance
hurdle of the Consolidated Group being granted a mining licence for the Kvanefjeld project.
No rights expired during the prior financial year ended the prior year ended 31 December 2019.
26: Financial instruments
(a) Capital risk management
The Consolidated Group manages its capital in order to maintain sufficient funds are available for the
Consolidated Group to meet its obligations and that the Group can fund its exploration and evaluation
activities as a going concern.
The Consolidated Group’s overall strategy remains unchanged from December 2019.
The capital structure of the Consolidated Group consists of fully paid shares and options as disclosed
in notes 17 and 18 respectively.
None of the Consolidated Group’s entities are subject to externally imposed capital requirements.
(b) Categories of financial instruments
Financial assets
Cash and equivalents
Trade and other receivables - current
Financial liabilities
Trade and other payables
Dec
2020
$' 000
Dec
2019
$' 000
36,438
185
1,259
8,599
47
941
Page | 57
65
65
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
Notes to the accounts
26: Financial instruments (cont’d)
(c) Financial risk management objectives
The Group’s principal financial instruments comprise cash and short term deposits. The main
purpose of the financial instruments is to earn the maximum amount of interest at low risk to the
Consolidated Group. For the year under review, it is the Consolidated Group’s policy not to trade in
financial instruments.
The main risks arising from the Consolidated Group’s financial instruments are interest rate risk, credit
risk and liquidity risk. The board reviews and agrees policies for managing each of these risks and
they are summarised below:
(i)
(ii)
(iii)
(iv)
Interest Rate Risk
The Consolidated Group is exposed to movements in market interest rates on short
term deposits. The policy is to monitor the interest rate yield curve out to 120 days to
ensure a balance is maintained between the liquidity of cash assets and the interest
rate return. The Consolidated Group does not have short or long term debt, and
therefore this risk is minimal.
There was no change in managing interest rate risk or the method of measuring risk
from the prior year.
Credit Risk
Credit risk refers to the risk that a counter party will default on its contractual
obligations resulting in financial loss to the Group. The Group has adopted the policy
of only dealing with credit worthy counterparties and obtaining sufficient collateral or
other security where appropriate, as a means of mitigating the risk of financial loss
from defaults.
The Consolidated Group has no significant credit risk exposure to any single
counterparty or any Consolidated Group of counterparties having similar
characteristics. The credit risk on liquid funds is limited because the counterparties
are banks with high credit – ratings assigned by international rating agencies.
The carrying amount of financial assets recorded in the financial statements, net of
any allowance for credit losses, represents the Consolidated Group’s maximum
exposure to credit risk.
There was no change in managing credit risk or the method of measuring risk from
the prior year.
Liquidity Risk
Liquidity risk refers to maintaining sufficient cash and cash equivalents to meet on
going commitments, as and when they occur. The primary source of liquid funds for
the Consolidated Group, are funds the Consolidated Group holds on deposit with
varying maturity dates.
The Consolidated Group monitors its cash flow forecast and actual cash flow to
ensure that present and future commitments are provided for. As well as matching
the maturity date of funds invested with the timing of future commitments.
There was no change in managing credit risk or the method of measuring risk from
the prior year.
Foreign Currency Risk
The Consolidated Group’s risk from movements in foreign currency exchange rates,
relates to funds transferred by the Company to the Greenland subsidiary and the
funds are held in Danish Krone (DKK). This risk exposure is minimised by only
holding sufficient funds in DKK, to meet the immediate cash requirements of the
subsidiary. Once funds are converted to DKK they are only used to pay expenses in
DKK.
66
Page | 58
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
Notes to the accounts
26: Financial instruments (cont’d)
(d) Liquidity risk
The following table details the Consolidated Group’s expected maturity for its non-derivative financial
assets. The tables below have been drawn up based on the undiscounted contractual maturities of
the financial assets including interest that will be earned on those assets except where the
Company/Consolidated Group anticipates that the cash flow will occur in a different period.
Weighted
Average
Effective
interest
rate
< 6
Months
6 – 12
Months
%
$' 000
$' 000
0.5
-
1.2
-
36,096
185
36,281
8,347
714
9,061
252
-
252
252
-
252
1 - 5
Years
$' 000
> 5
Years
$' 000
Total
$' 000
-
-
-
-
-
-
-
-
-
-
-
-
36,348
185
36,533
8,599
714
9,313
Dec 2020
Cash and equivalents
Trade and receivables - current
Dec 2019
Cash and equivalents
Trade and receivables - current
The following table details the Consolidated Group’s remaining contractual maturity for its non-
derivative financial liabilities. The tables have been drawn up based on the undiscounted cash flows
of financial liabilities based on the earliest date on which the Group can be required to pay. The table
includes both interest and principal cash flows.
Weighted
Average
Effective
interest
rate
%
-
-
-
-
< 6
Months
$' 000
6 – 12
Months
$' 000
1 – 5
Years
$' 000
> 5
Years
$' 000
Total
$' 000
1,259
-
1,259
941
-
941
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,259
-
1,259
941
-
941
Dec 2020
Trade and other payables
Other liabilities
Dec 2019
Trade and other payables
Other liabilities
(i)
Refer to note 15 for maturity profile of lease liabilities.
(e) Interest rate risk
The Consolidated Group is exposed to interest rate risk because it places funds on deposit at variable
rates. The risk is managed by the Consolidated Group by monitoring interest rates.
Page | 59
67
67
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
Notes to the accounts
26: Financial instruments (cont’d)
The Consolidated Group’s exposures to interest rates on financial assets and financial liabilities are
detailed in the liquidity risk management section of this note.
The Group has performed sensitivity analysis relating to its exposure to interest rate risk at balance
date. This sensitivity analysis demonstrates the effect on the current year results and equity post tax
which could result from a change in these risks. In the analysis a 1% or 100 basis points movement
has been applied on the assumption that interest rates are unlikely to move up more than that and
less likely to fall. This is taking into account the current interest rate levels and general state of the
economy.
There has been no change in managing credit risk or the method of measuring risk from the prior
year.
Interest Rate Sensitivity Analysis
At 31 December 2020, the effect on profit and equity as a result of changes in the interest rate, with
all other variables remaining constant would be as follows:
Change in profit
Increase in interest rate by 1% (100 basis points)
Decrease in interest rate by 1% (100 basis points)
Dec
2020
$' 000
Dec
2019
$' 000
85
(85)
64
(64)
A 1% or 100 basis points variable has been applied to the interest rate sensitivity analysis, after giving
consideration to the current interest rate levels and general state economy.
Fair value of financial instruments
The carrying value of all financial instruments is the approximate fair value of the instruments. This is
based on the fact that all financial instruments have either a short term date of maturity or are loans to
subsidiaries.
27: Key management personnel compensation
The aggregate compensation made to key management personnel of the Consolidated Group is set
out below:
Short-term employee benefits
Bonus payments
Other benefits (i)
Post-employment benefits
Other long-term benefits – provision for
long service leave
Share-based payment
Year ended
31 Dec
2020
$
898,913
-
38,316
68,400
Year ended
31 Dec
2019
$
760,000
200,000
38,109
68,398
4,747
267,268
1,277,644
9,525
(178,623)
897,409
(i) Recognition of increase in annual leave provision resulting from the accrual of statutory
annual leave being greater than the annual leave taken by the respective KMP.
Refer to the remuneration report included in pages 22 to 29 of the Directors report for more detailed
remuneration disclosures.
68
Page | 60
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
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69
69
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
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(
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
Notes to the accounts
29: Transactions with related parties
Simon Cato is a Non-executive Director and Chairman of Advanced Share Registry Limited. Advanced
Share Registry Limited provides share registry services to Greenland Minerals Limited. These services
are supplied on normal commercial terms and Mr Cato does not receive any remuneration from
Advanced Share Registry Limited based on the supply of share registry services to the Consolidated
Group. For the year ended 31 December 2020 $91,762 was paid to Advance Share Registry Limited for
services provided (Dec 2019: $42,814).
30: Parent Company information
Financial position
Total Current Assets
Total Non-Current Assets
Total Assets
Total Current Liabilities
Total non-current liabilities
Total Liabilities
Net Assets
Equity
Issued Capital
Reserves
Accumulated Losses
Total Equity
Financial Performance
Profit (Loss) for the year
Total comprehensive income
Parent
Dec
2020
$' 000
Dec
2019
$' 000
36,486
89,768
126,254
1,734
463
2,197
124,057
404,688
20,579
(301,210)
124,057
9,260
85,922
95,182
1,238
709
1,947
93,235
371,808
20,439
(299,012)
93,235
(2,198)
(2,198)
(3,577)
(3,577)
Contingent liabilities
The parent company has no contingent liabilities as at 31 December 2020 or 2019.
Guarantees
Greenland Minerals Limited has guaranteed the provision of funding and support to the Company’s
100% held subsidiary, Greenland Minerals A/S). This funding forms part of the Consolidated Group’s
approved budgeted expenditure.
Greenland Minerals Limited placed $220,000 into a deposit account with the Company’s bank. This
deposit is held by the bank as security over the Company’s corporate credit cards on issue.
A deposit of $32,604 is held as a bank guarantee on the Company’s leased office in Perth.
Page | 63
71
71
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Notes to the accounts
31: Remuneration of auditors
Auditor of the parent entity
Audit or review of the financial report
Other assurance services
Related practice of the parent entity auditor
Audit or review of the financial report
Non-audit services – taxation
Non-audit services – other
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
Dec
2020
$
Dec
2019
$
91,075
8,400
99,475
90,825
8,400
99,225
Dec
2020
$
Dec
2019
$
40,814
4,325
4,215
49,354
30,801
1,830
2,261
34,892
The auditor of Greenland Minerals Limited is Deloitte Touche Tohmatsu.
32: Subsequent Events
On 16 February 2021, an early general election was called in Greenland, to be held on 6 April 2021. A
change of the Greenland government and any subsequent changes in government policy may impact
the Company’s Kvanefjeld project and the permitting process. It is not possible to assess what these
impacts may be at the date of signing this annual report.
The Company has a history of working cooperatively with Greenland governments and will look to
continue this co-operation into the future.
The statutory public consultation process for the Kvanefjeld project commenced on 17 December 2020
and was initially scheduled to continue for a 12 week period. The Greenland government extended this
to a 23 week period in early 2021 due to COVID 19 travel restrictions. The public consultation period is
now scheduled to conclude on 1 June 2021.
There have been no other matters or circumstances occurring subsequent to the financial year that has
significantly affected, or may significantly affect, the operations of the Consolidated Group, the results of
those operations, or the state of affairs of the Consolidated Group in future years.
72
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GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Additional stock exchange information as at 19th February 2021
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
Consolidated Group secretary
Miles Guy
Registered office
Unit 7, 100 Railway Road, Subiaco
Western Australia, 6008
Share registry
Advanced Share Registry Services
110 Stirling Highway
Nedlands, Western Australia, 6009
Principal administration office
Unit 7, 100 Railway Road, Subiaco
Western Australia, 6008
Table of exploration licences
Exploration Licence
EL 2010/02
Location
Southern Greenland
Ownership
100% held by Greenland Minerals A/S
Number of holders of equity securities
Ordinary share capital
1,340,998,346 fully paid ordinary shares are held by 7,615 individual shareholders.
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GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
Greenland Minerals Limited
And Controlled Entities
31 December 2020 Financial Report
Additional stock exchange information as at 19th February 2021
Substantial Shareholders
Shareholder
1.
2.
3.
4.
JP Morgan Nominees Pty Limited
Citicorp Nominees Pty Limited
HSBC Custody Nominees (Australia) Limited
Le Shan Shenghe Rare Earth Company Limited
Number
201,243,534
153,627,258
145,467,037
125,000,000
Percentage
15.0%
11.5%
10.4%
9.3%
Distribution of holders of quoted shares
Share Spread
Holders
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Twenty largest holders of quoted shares
402
1,623
1,282
3,334
974
7,615
Units
135,433
5,265,623
10,331,033
123,597,740
1,201,668,517
1,340,998,346
Percentage
0.01%
0.39%
0.77%
9.22%
89.61%
100%
JP Morgan Nominees Pty Limited
Peto Pty Ltd <1953 Super Fund A/C>
Simon Millington
Le Shan Shenghe Rare Earth Company Limited
BNP Paribas Noms Pty Limited
Ordinary shareholders
1.
2. HSBC Custody Nominees (Australia) Limited
3. Citicorp Nominees Pty Limited
4.
5.
6. Merrill Lynch (Australia) Nominees Pty Limited
7.
8.
9. GEJJ Super Pty Ltd
10. John Mair
11. Red Eight Pty Ltd
12. Simon Cato
13. Melda Super Pty Ltd
14. Armus Aavelaid
15. Paul Damian Conboy
16. M & H Andrusiewicz
17. Harvey Stern
18. National Nominees
19. YW Ho & KKL Ho
20. Sie Lung Kwee
Fully paid ordinary shares
Percentage
15.0%
11.6%
11.5%
9.3%
3.3%
2.9%
2.6%
0.9%
0.8%
0.6%
0.6%
0.5%
0.5%
0.5%
0.4%
0.4%
0.4%
0.4%
0.4%
0.3%
Number
201,243,534
155,614,404
153,627,258
125,000,000
44,706,069
39,341,055
34,200,000
12,500,000
10,993,137
8,364,062
8,200,000
6,389,594
6,203,125
6,107,372
5,840,380
5,600,000
5,200,000
4,797,332
4,774,556
4,756,779
843,458,657
62.9%
74
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GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT
75
76
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT RARE EARTHS FROM KVANEFJELD FOR
THE WORLD’S GREENER TECHNOLOGY
7777
GREENLAND MINERALS LIMITED – 2020 ANNUAL FINANCIAL REPORT GREENLAND MINERALS LIMITED
Registered Office & Principal Place of Business
Unit 7, 100 Railway Road, Subiaco, Western Australia, 6008
Postal Address
PO Box 2006, Subiaco, Western Australia, 6904
Tel: +61 8 9382 2322
Fax: +61 8 9382 2788
www.ggg.gl