FOR THE YEAR ENDED 31 DECEMBER 2019
CONTENTS
CHAIRMAN’S LETTER
REVIEW OF OPERATIONS
MINERAL RESOURCES AND ORE RESERVES
DIRECTORS’ REPORT
REMUNERATION REPORT
AUDITOR’S INDEPENDENCE DECLARATION
INDEPENDENT AUDITORS’ REPORT
DIRECTORS’ DECLARATION
1
2
15
17
25
40
41
46
CONSOLIDATED STATEMENT OF PROFIT AND
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
SHAREHOLDER INFORMATION
TENEMENT DETAILS
47
49
50
51
52
103
106
CORPORATE DIRECTORY
Geopacific Resources Limited
Public listed Company (ASX Code: GPR) incorporated in New South Wales in 1986
Australian Business Number (ABN)
57 003 208 393
Directors & Secretary in Office
Ian Clyne
Ron Heeks
Colin Gilligan
Ian Murray
Matthew Smith
Milan Jerkovic
Mark Bojanjac
Non-Executive Chairman
Managing Director
Non-Executive Director
Non-Executive Director
Company Secretary
Non-Executive Chairman
Non-Executive Director
Registered Office
Level 1
278 Stirling Highway
Claremont WA 6010
Auditor
Ernst & Young
The Ernst & Young Building
11 Mounts Bay Road
Perth WA 6000
Share Registry
Boardroom Pty Ltd
Grosvenor Place
Level 12, 225 George Street
Sydney NSW 2000
Woodlark Registered Office
Level 5, Defense Haus
Hunter Street and Champion Parade,
Port Morseby,
Papua New Guinea
appointed 9 September 2019
resigned 8 May 2019
resigned 29 May 2019
Postal Address
PO Box 439
Claremont WA 6910
Banker
ANZ Banking Group Ltd
Corner of Hay Street & Outram Street
West Perth WA 6005
Stock Exchange
ASX Limited
Level 4, Central Park
152-158 St Georges Terrace
Perth WA 6000
ASX Code: GPR
CHAIRMAN’S LETTER
Dear Shareholder,
Geopacific Resources Limited (Geopacific or the Company) had a productive and successful 2019, which
culminated in the commencement of development of the Woodlark Gold Project in December 2019.
The past year has been pivotal for Geopacific. Following
the release of a robust Definitive Feasibility Study (DFS)
in November 2018, the Company focused on activities that
contributed to the execution of the Woodlark Gold Project.
These efforts resulted in the achievement of several
milestones that saw Geopacific proceed along the path to
production.
From a Corporate perspective, efforts focused on simplifying
the ownership structure of the Woodlark Gold Project and
on advancing towards a complete project funding solution.
During the year, Geopacific secured 100% direct ownership
of the Woodlark Gold Project and undertook two successful
capital raisings.
In March 2019, a $4.3 million oversubscribed capital raising
($4.3 Million Placement) was completed with the funds
used to advance project financing due diligence. A key part
of this due diligence was the completion of an Independent
Technical Expert (ITE) Report that validated the key technical
aspects of the Woodlark Gold Project.
In the December 2019 quarter, Geopacific completed a $40
million share placement ($40 Million Placement). Following
the $40 Million Placement, Geopacific commenced a Civil
Works Program at the Woodlark Gold Project that saw
the mobilisation of supplies, equipment and personnel.
The Civil Works program will prepare the Woodlark Gold
Project for the construction of a 2.4 Mtpa gold processing
facility and marks another crucial step towards production.
These successful fund raising efforts demonstrate the
ongoing support of our shareholders and their belief in
the potential of the Woodlark Gold Project. The Company
continues to advance project-funding arrangements in 2020.
Like other organisations, the Senior Management Team
is currently navigating the Company through the global
impacts of COVID-19. In response to recent events,
Geopacific deferred certain activities associated with the
Civil Works Program to protect the health and wellbeing of
our employees and the communities in which the Company
operates. Geopacific will use this time to refine project
execution plans and advance discussions relating to project
funding arrangements.
I would like to acknowledge and thank Milan Jerkovic and
Mark Bojanjac who resigned as Directors’ of Geopacific
during the reporting period. During their tenure, Geopacific
secured ownership of the Woodlark Gold Project and
completed a Definitive Feasibility Study (DFS). These are
the foundations that see Geopacific positioned on a path to
gold production today. I would like to welcome to the Board
Ian Murray as a Non-Executive Director. Mr Murray brings
a wealth of financial, corporate, project development and
operational experience to the board.
I would like to thank my fellow Directors and the
Management team for their unwavering support
in
progressing the Woodlark Gold Project. I would also like
to thank the government of Papua New Guinea and the
Woodlark Island community for the support they have
provided to Geopacific in getting the Woodlark Gold Project
ready for construction.
The Company is well positioned for the year ahead with
a cash balance of $37.5 million at 31 December 2019. The
fundamentals of the Woodlark Gold Project remain as strong
as ever with record Australian dollar gold prices despite
the volatility in global asset valuations. Our team, led by
Ron Heeks, has done a magnificent job in progressing the
Woodlark Gold Project along the path to production in 2019
and I have every confidence this will continue in 2020.
Ian Clyne
Chairman
1
2019 ANNUAL REPORT REVIEW OF OPERATIONS
WOODLARK ISLAND, PAPUA NEW GUINEA
Background – Woodlark Gold Project
Geopacific Resources Limited (“Geopacific” or “the Company”)
and its controlled entities (“the Group” or “Consolidated
entity”) is focused on developing and expanding the 1.6Moz
Woodlark Gold Project1.
The project is situated in the ‘pacific rim of fire’ and
surrounded by world-class gold mines.
Two neighbouring mines, also located on islands, are
Newcrest Mining Limited’s Lihir at 66 million ounces of gold
and St Barbara Limited’s Simberi at 6 million ounces.
that moved
During the year, Geopacific achieved several crucial
milestones
the Woodlark Gold Project
significantly closer to production. In March 2019 a $4.3
Million Oversubscribed Capital Raising (the $4.3 Million
Placement) was completed with the funds used to advance
project financing due diligence and to advance the execution
strategy for project development. In June 2019 Geopacific
secured 100% direct ownership of the Woodlark Gold
Project, simplifying the ownership structure and reducing
corporate costs.
The 100% owned Woodlark Gold Project is located on an
island in the Milne Bay Province of Papua New Guinea.
The November 2018 Feasibility Study2 demonstrated a
compelling development opportunity, both from a technical
and financial perspective. The Woodlark Gold Project
economics are driven by its low stripping ratio leading to low
costs, within a positive operating environment and a simple
processing route.
In August 2019, an Independent Technical Expert (ITE) Report
was completed on behalf of potential lenders and distributed
to key stakeholders. In order to advance its project execution
strategy, Geopacific sought a lump sum turnkey solution for
the construction of the processing plant and after a rigorous
evaluation and selection process a conditional letter of intent
was issued to GR Engineering Service Ltd (GR Engineering)
for the construction of a gold processing plant.
1 For Mineral Resource refer to page 15 and PFS announcement released on 12 March 2018.
2 All material assumptions underpinning the production target and forecast financial information continue to apply and have not
changed materially.
2
2019 ANNUAL REPORT REVIEW OF OPERATIONS
During the December 2019 quarter, Geopacific completed a
$40 million share placement (the $40 Million Placement).
The proceeds of the $40 Million Placement are currently
being used to commence development at the Woodlark Gold
Project.
The first phase of development consists of the following
activities, together referred to as the Civil Works Program:
• Repair and construction of roads;
• Construction of a new wharf;
• Relocation of the Kulumadau village;
• Upgrades to the Woodlark mining camp; and
• Front end engineering design
The Civil Works Program commenced in December 2019
with the mobilisation of supplies, equipment and personnel
to site.
Definitive Feasibility Study – Woodlark Gold Project
The November 2018 Definitive Feasibility Study (DFS)
demonstrates a 13-year gold project with a compelling
development option, both from a technical and financial
perspective. The Woodlark Gold Project generates A$626
million of operating cashflow (based on A$1,650 per ounce
gold price assumption) and a rapid 2.2 year project payback
period. The Woodlark Gold Project economics are driven by
its low stripping ratio leading to low costs, within a positive
operating environment and a simple process route. The
Woodlark DFS was completed to a 15% level of accuracy.
Project highlights include:
• High margin – all-in sustaining costs (AISC) averaging
A$866/oz (Yr 1-5) and A$1,033/oz Life of Mine (LOM)
due to shallow pits, low waste to ore ratio, flat terrain
and outcropping soft ore.
• Strong cash flow – upfront operating cash flow generates
rapid 2.2 year payback period.
• Robust production profile – simple process route with
gold production averaging 100koz per annum (Yr1-5),
967koz (LOM) (incl. 41.koz Au Inferred).
• +1Moz – Reserve 28.9Mt @ 1.12g/t Au for 1,037,600oz of
gold.3
• Resource 47Mt @ 1.04g/t Au for 1.57Moz of gold.4
• Licence to operate – operating permits granted in proven
mining investment jurisdiction with a supportive local
community.
• Exploration upside –
immediate near-pit resource
growth potential & highly prospective regional exploration
portfolio.
AISC averaging A$866/oz in the first 5 years, and A$1,033/
oz over the life of mine, are possible due to wide, near
surface ore zones. This allows for a very low waste to ore
stripping ratio, averaging 2.7:1 in the first two years driving
maximum upfront cashflow.
A conventional Carbon in Leach (CIL) processing plant
combined with free milling, fast leaching and soft ore
provides for strong cash generation. These factors, coupled
with a simple mining and processing route, de- risk the
Woodlark Gold Project and provide a rapid payback period
due to high margins generated.
Island presents an attractive operating
Woodlark
environment with many
logistical advantages and
competitive operating costs, made possible by its flat
topography and supportive local community. With the
majority of the future labour force living locally, the
development of the Woodlark Gold Project will provide
a positive social benefit for the local community while
maintaining competitive operational costs.
3 For Mineral Reserve refer to Table 2 on page 15 and ‘Woodlark Ore Reserve Update’ announced on 7 November 2018.
4 For Mineral Resource refer to Table 1 on page 15 and PFS announcement released on 12 March 2018.
3
2019 ANNUAL REPORT REVIEW OF OPERATIONS
The table below presents a key information summary covering the forecast operational physicals, key inputs, cashflow, unit
costs and financial, completed to a +15% level of accuracy.
OPERATIONAL PHYSICALS
Strip Ratio
Total Material Mined
Ore Mined
Grade Mined
Contained Gold
Ore Processed
Grade
Recovery
Gold Produced
* Excludes pre-strip period
KEY INPUTS
Gold Price
Foreign Exchange
Mining Cost
Processing Cost
General & Admin Cost
CASHFLOW
Cashflow from Operations
Less: Capital Expenditure
Free Cashflow (Pre-tax)
Less: Income Tax
Free Cashflow (Post-tax)
UNIT COSTS - C1 & AISC
Mining
Processing
G&A
Refining Costs
Total C1 Costs
Royalties
Sustaining Capital
Corporate Overheads
Total AISC
Unit
(x)
(kt)
(kt)
(g/t Au)
(oz Au)
(kt)
(g/t Au)
(%)
(oz)
Unit
/oz Au
A$ : US$
/t mined
/t processed
/t processed
Unit
Million (M)
Million (M)
Million (M)
Million (M)
Million (M)
Unit
/oz Au
/oz Au
/oz Au
/oz Au
/oz Au
/oz Au
/oz Au
/oz Au
/oz Au
First 5 Yrs of Production *
Life of Mine
3.2
77,601
18,404
1.16
688,948
11,804
1.52
90.2%
522,034
3.9
149,189
30,304
1.11
1,083,291
30,304
1.11
88.8%
967,117
Life of Mine US$
Life of Mine A$
1,237
1.33
1.88
1.88
3.35
1,650
0.75
2.51
13.77
4.47
Life of Mine US$
Life of Mine A$
469
(152)
318
(60)
257
626
(202)
424
(80)
343
Life of Mine US$
Life of Mine A$
281
324
105
5
714
28
13
20
775
374
431
140
6
952
37
18
26
1,033
FINANCIAL METRICS - POST-TAX
Life of Mine US$M
Life of Mine A$M
148
29%
2.2 Years
197
29%
2.2 Years
NPV @ 8%
IRR
Project Payback
4
2019 ANNUAL REPORT REVIEW OF OPERATIONS
Geology and Exploration
Geopacific controls 580 square kilometres of exploration
licences along with a 60 square kilometre Mining Lease,
covering highly prospective volcanic sequences. More
than 300 kilometres of development drilling to date has
delineated over 1.57 million ounces of gold mineral
resources5 and all defined mineral resources remain open
along strike and down dip.
Geopacific inherited over $150 million of historic spend
on Woodlark Gold Project, which included a wealth of
drilling data from over 275 kilometres of historic drilling.
Geopacific’s team has undertaken a rigorous process of
review, validation and reinterpretation of geological data to
create a robust view on existing resources.
Near Pit Resource Extensions
At the Kulumadau deposit, gold mineralisation is open
beneath the planned pit in all directions, particularly down
dip of the major mineralised trend (Figure 1). Deeper
drilling under the existing deposits presents a near-term
opportunity to increase mineral resources at depth and
along strike of the planned pits.
Figure 1: Gold mineralisation open in all directions beneath the planned Kulumadau pit
5 Refer to March 2018 Pre-feasibility Study – ‘Robust Woodlark Gold project PFS Supports Development.’
5
2019 ANNUAL REPORT REVIEW OF OPERATIONS
To date, Geopacific has strategically focussed drilling within
conceptual pit shells for development purposes and is yet
to test the near pit potential. The low proportion of Inferred
Resources (14%) and the 82% conversion of Mineral
Resources into Ore Reserves reflects the open nature of
defined Mineral Resources.
Additionally, a significant area within the proposed pit
remains undrilled due to site access restrictions agreed to
avoid disturbing the resident villagers (Figure 2). This area
is of high priority, is prospective for gold mineralisation and
is currently designated as waste material in the current
mining schedule. Drilling of this target will commence once
the village relocation program has concluded.
Near Pit “Blind” Mineral Resources
Conventional surface sampling and mapping has historically
been ineffective due to a layer of sediment that covers the
majority of the exploration licenses, making discoveries
principally reliant on drilling. Although gold mineralisation
is not visible at surface, defined ore bodies are strike-
continuous and provide high potential for discoveries beneath
the cover adjacent to, or along strike of, known ore bodies.
This has been a recurring theme on Woodlark Island as
demonstrated by the blind discovery of the Boscalo prospect
(north of Kulumadau East), which was made by following
mineralised structural trends beneath the sedimentary
cover. This exemplifies the highly prospective nature of
near-resource target areas. Figure 2 highlights known
mineralised trends in the Kulumadau region that continue
under cover and form high priority exploration targets.
Figure 2: Kulumadau area extensional exploration targets
6
2019 ANNUAL REPORT REVIEW OF OPERATIONS
Existing Gold Prospects
Regional “Blind” Discoveries
Regional soil sampling and mapping has already
delineated high-grade soil gold anomalies, one of which
is 1.4 kilometres in length, and has returned values up to
6.26g/t Au. Over 30 known prospect areas are scheduled for
systematic exploration assessment in the form of surface
geochemical sampling, geological mapping, trenching and
if warranted, drilling.
A significant number of drainages show visible gold in gold
panning (Figure 3) and all require systematic follow up
exploration to assess the source of gold in each drainage.
Exploration drilling has a high strike rate of intersecting
gold mineralisation, with over 71% of all holes intersecting
gold values >0.5g/t Au downhole.
Aeromagnetic data shows a number of major structural
features spatially associated with gold mineralisation
observed in drilling and outcrop. The five kilometre trend
between Busai and Kulumadau is a priority target area
(Figure 3) and has not been drill tested as it is hidden under
sedimentary cover.
Gold mineralisation at Woodlark King occurs along a
prominent north-west trending structural feature with drill
holes intersecting >0.5g/t Au downhole that stop at the
edge of covering sediment. Numerous regional structural
targets highlighted in red (below) and will be assessed by
surface drilling systematically.
Figure 3: Regional exploration targets
7
2019 ANNUAL REPORT REVIEW OF OPERATIONS
Project Financing – Woodlark Gold Project
In August 2019, an ITE Report was completed on behalf of
potential lenders and distributed to key stakeholders.
The ITE review is a standard form of technical due diligence
when seeking project funding in the industry. The process
involves appointing a team of independent experts to review
all technical, financial, environmental and social aspects of
the project.
SRK Consulting (SRK) were appointed to undertake the
technical aspects of the review. ERM Consulting (ERM)
were appointed to undertake the environmental and
social aspects of the review. These appointments followed
consultation with a consortium of potential lenders. As
part of the final stage of the review, a site visit to Woodlark
Island was also undertaken.
The scope of the review was comprehensive and covered
the following specific areas:
Infrastructure;
• Geology & Mineral Resources;
• Metallurgy & processing;
•
• Logistics;
• Environmental; and
• Social.
The ITE Report validated key technical aspects of the
Woodlark Gold Project and allowed Geopacific to advance
project development by progressing to the next stage of
project funding.
Project Execution – Woodlark Gold Project
Geopacific continued to progress towards a successful
execution of the Woodlark Gold Project during the year.
Mining Contractor
Geopacific continues to assess options relating to the
execution of future mining activity for the Woodlark Gold
Project with the aim of ensuring that return on investment
from the ore body is maximised.
Management are currently reviewing potential benefits
from adopting a contract mining operating model as
opposed to an owner operator model. The extensive
industry experience of the Board and Senior Management
Team is invaluable when assessing options associated with
these important strategic decisions.
Engineering, Procurement, and Construction (EPC)
strategy
For the determination of forecast capital costs, Geopacific
adopted an engineering, procurement and construction
management (EPCM) strategy in the DFS. During the year,
the Company decided to pursue an EPC strategy in order to
ensure project delivery guarantees and transfer an element
of the price risk to the EPC contractor.
Adopting an EPC model will provide a higher level of
certainty on the final capital cost and de-risk a significant
portion of the Woodlark Gold Project from a funding
perspective.
8
Following the decision to adopt an EPC strategy, Geopacific
sought to select a lump sum turnkey solution for the
construction of the Woodlark Gold Project processing plant.
Geopacific conducted a robust evaluation and selection
process involving a number of highly reputable engineering
companies. Engineering companies for tender were selected
on the basis of their credibility and experience in delivering
similar gold operations to the Woodlark Gold Project.
All proposals received were carefully evaluated to assess
pricing, technical and management competence, proposed
design specifics, financial capacity and relevant experience
in Papua New Guinea.
Upon completion of this rigorous evaluation and selection
process a conditional letter of intent was issued to GR
Engineering for the construction of the Woodlark Gold
Project’s 2.4Mtpa carbon in leach (CIL) process plant,
tailings line and other supporting infrastructure.
The Company also appointed independent engineering
consultants, Mintrex Pty Ltd (Mintrex) to conduct a review of
GR Engineering’s proposed plant design. In the December
2019 quarter, Mintrex validated GR Engineering’s proposed
process plant design. Mintrex has extensive capabilities
in gold processing and significant experience with similar
gold operations both internationally and in Australia.
Figure 4: GR Engineering-designed 2.4Mtpa gold process plant
Project Development – Woodlark Gold Project
In December 2019, the proceeds from the $40 Million
Placement enabled the company to commence the Civil
Works Program on the Woodlark Gold Project.
Key Contracts Signed
Following the decision to commence the Civil Works
Program, a contract was signed with HBS Machinery
(HBS) to undertake earthmoving civils at the Woodlark
Gold Project. HBS were engaged to provide equipment
and personnel to construct new roads, repair existing
roads, construct the wharf causeway and undertake bulk
earthworks operations at the plant site in preparation for
the process plant build.
A contract was also signed with Rhodes Projects (Rhodes),
a project manager located in Papua New Guinea, to provide
materials and skilled supervisors to oversee a local team that
will build the necessary housing and infrastructure required
to enable the relocation of the existing Kulumadau village.
2019 ANNUAL REPORT REVIEW OF OPERATIONS
Mobilisation
On 13 December 2019, key supplies and equipment were
mobilised to site, along with over 30 contractors from HBS
and Rhodes. Personnel were transported to site on a 36
seat Dash 8 charter flight. Equipment, fuel and food were
mobilised to site by barge.
The successful mobilisation marked another key milestone
critical to the success of the Woodlark Gold Project and was
the culmination of a considerable amount of planning and
co-ordination among multiple parties.
Figure 5: Equipment for Civil Works Program barged to site
Figure 6: Barge arrives at Woodlark Island
2.4mtpa CIL Process Plant Site Clearing
Wharf Construction
Following the mobilisation of heavy equipment in December
2019, bulk earthworks operations at the process plant site
commenced in preparation for the process plant build.
Preparation of the process plant site clearing progressed
steadily assisted by the flat topography of the Island which
considerably reduces the amount of material that needs to be
removed in order to create a cleared site for the process plant.
Geophysical drilling will form part of the Civil Works
Program to facilitate the design of the foundations for a
2.4Mtpa processing plant.
There are currently operational wharf facilities situated
on Woodlark Island which are located 15 kilometres from
the process plant site. To improve the efficiency of the
the transport of material and minimise the disturbance
to local villages on the island, a new wharf facility will be
constructed as part of the Civil Works Program. The new
wharf will be located five kilometres from the process
plant site.
Figure 7: Process plant site cleared as part of the Civil Works Program
9
2019 ANNUAL REPORT REVIEW OF OPERATIONS
Road Infrastructure
The Civil Works Program currently being undertaken on site will deliver critical infrastructure to facilitate the construction
of the 2.4Mtpa processing plant and the operation of subsequent mining activities.
Part of this infrastructure includes the construction of new roads and repair of the existing road network. A road from the
new wharf to the processing plant site will also be constructed as part of the Civil Works Program.
Figure 8: Road clearing activity on the Woodlark Island
Village Relocation
An important part of the Woodlark Gold Project is the relocation of the relatively small Kulumadau village. The village,
currently located on the mining lease, will be relocated to new areas selected by the residents, outside the mining lease.
The relocation will include construction of over 200 new houses, churches, stores, schools and other buildings.
Figure 9: Details of civil works and village relocation activities to be undertaken
10
2019 ANNUAL REPORT REVIEW OF OPERATIONS
In December 2019, a contract was signed with Rhodes to
provide materials and skilled labour for the construction
of the new village. Following their mobilisation to site,
workshops were constructed and a workforce from the
local population was established.
The success of the current on-site activities demonstrates
a willingness of the local Island population to partner with
Geopacific in working towards successful completion of the
project, which will lead to ongoing and sustainable benefits
to the community.
The prioritisation of labour sourced from the local
community is vital to ensure that there is “ownership” of
the build, and that the requisite skills are passed across to
the villagers to maintain and expand houses in the future.
Community Relations – Woodlark Gold Project
Critical to the success of the Woodlark Gold Project is the
ongoing support and cooperation of the local community.
Geopacific continues to maintain regular and cooperative
stakeholder consultations and
local,
provincial and national bodies.
initiatives with
Over 100 Woodlark Islanders are either working for the
Company or its contractors. Upskilling the workforce to
enable the successful implementation of the Woodlark
Gold Project build and having an operating team ready for
the commencement of mining and processing operations is
an integral part of the community program.
Figure 10: Existing three bedroom house
Figure 11: New house under construction
Figure 12: Community consultation and engagement has been extensive during 2019
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2019 ANNUAL REPORT REVIEW OF OPERATIONS
Mining License – Woodlark Gold Project
In September 2019, Geopacific received an extension to
the construction timeline in the Mining Licence for the
1.6Moz Woodlark Gold Project6. The amendment granted
by the Minster for Mining, The Hon Johnson Tuke MP,
was required to extend the timeframe for completion of
construction and commissioning of the processing facility
which was previously required by January 2020.
The completion of the build is now required to be achieved
before the 5 July 2022, providing Geopacific with time to
finance and construct the project. The extension is the key
approval required from Mineral Resources Authority (MRA)
to commence construction of the Woodlark Gold Project.
CORPORATE
100% Direct Ownership of Woodlark
In March 2019, Geopacific secured 100% direct ownership
of Woodlark, simplifying the ownership structure and
reducing corporate costs for the Group. On 6 March 2019,
an agreement was signed to acquire from Kula Gold Ltd
(Kula) all of their rights and interests in the Woodlark
Gold Project. The agreement was subject to requisite
shareholder approval from both Kula and Geopacific, which
was successfully obtained on 25 June 2019.
Geopacific secured 100% ownership of Woodlark in return
for issuing 150 million Geopacific shares (Consideration
Shares) to Kula and paying approximately $0.74 million
cash to Kula concurrent to cancelling its existing 85%
shareholding in Kula. Kula immediately applied the cash
to repay its loan from Geopacific of approximately $0.72
million.
On 9 July 2019, Kula distributed the Consideration Shares
pro-rata to its shareholders. Each Kula shareholder
received approximately 2.55 Geopacific shares
for
every Kula share held. Kula ceased to be a subsidiary of
Geopacific and all relationships between the parties were
extinguished including the resignation of Geopacific’s
representatives from their positions as directors on the
Kula Board.
Capital Raising - $4.3 Million Placement
In March 2019, a $4.3 Million Placement, of 510 million
ordinary shares, was completed at $0.0085, representing
a discount of 23% to the last close and a 24% discount to
the 5 day Volume Weighted Average Share Price. The $4.3
Million Placement was oversubscribed with offers from
new and existing sophisticated and professional investors.
The $4.3 Million Placement was made pursuant to the
Company’s 15% placement capacity under Listing Rule 7.1
(312,286,070 shares) and Listing Rule 7.1A (197,713,930
shares).
In conjunction with the $4.3 Million Placement, Resource
Capital Funds divested its holding in the Company, of
approximately 358.6 million shares (17%) (Block Trade).
The Block Trade was placed with a European investment
group, DELPHI Unternehmensberatung AG (DELPHI) on
25 March 2019. DELPHI also demonstrated support by
participating in the $4.3 Million Placement.
Proceeds from the raising were primarily used to advance
the due diligence in relation to project financing and for
working capital purposes as the Company progressed the
structure of the financing of the Woodlark Gold Project.
Capital Raising – $40 Million Placement
During the December 2019 quarter, Geopacific completed
a $40 million share placement. The $40 Million Placement
was made to Sophisticated and Professional Investors for
1,600 million fully paid ordinary shares at $0.025 per share.
The $40 Million Placement was composed of two tranches,
the first of which was completed within the Company’s
placement capacity and raised $17.2 million excluding
transaction costs. The 1st Tranche net proceeds were
received by the Company in October 2019.
The 2nd Tranche, to raise $22.8 million was approved by
shareholders at the general meeting held on 9 December
2019. The 2nd Tranche net proceeds were received by the
Company in December 2019.
Geopacific is currently using the funds to complete the Civil
Works Program at the Woodlark Gold Project. Following
the $40 Million Placement, the Company continued to
progress towards a complete project funding solution with
the capital raised proving to be a strong catalyst to advance
discussions with potential debt providers.
Share Purchase Plan (SPP)
The Company offered a SPP at $0.025 per share, the same
price as the $40 Million Placement, to raise up to a further
$5 million.
The SPP allowed eligible shareholders to acquire up
to $30,000 worth of shares. The SPP offer closed on
29 November 2019 and the Company raised $101,000
(4,040,000 Shares).
Share Consolidation
On 21 October 2019, a share consolidation was proposed to
convert every 25 shares on issue to 1 share. Following the
successful $40 Million Placement, the Board considered
the Share Consolidation as an important and necessary
restructure designed to broaden the Company’s market
appeal.
The consolidation was approved by shareholders at the
general meeting held on 9 December 2019 and was
completed in late December 2019.
6 For Mineral Resource refer to page 15 and PFS announcement released on 12 March 2018.
12
2019 ANNUAL REPORT REVIEW OF OPERATIONS
Director appointment and resignation
OTHER PROJECT ACTIVITIES
On 8 May 2019, Milan Jerkovic resigned as Chairman of the
board. Following the resignation of Mr Jerkovic, Ian Clyne
assumed the role of Non-Executive Chairman of the board.
On 29 May 2019, Mark Bojanjac also resigned as Non-
Executive Director.
Mr Clyne has worked in asset based finance, project
finance, and emerging market bank transformation and
modernisation projects. Roles included President Director,
Group Chief Executive Officer, Chief Risk Officer and
Non-executive Director in several publicly listed financial
institutions.
Mr Clyne has 11 years experience working and living in
Papua New Guinea on two occasions, the most recent as
Group Chief Executive Officer of Bank South Pacific Limited
(BSP) from 2008 to 2013 where he led a highly successful
transformation project.
On 9 September 2019, Mr Ian Murray was appointed as an
Independent Non-executive Director on the board.
Mr Murray brings a wealth of financial, corporate, project
development and operational experience to the Board and
most recently held the role of Managing Director of Gold
Road Resources (Gold Road). Mr Murray was instrumental
in taking Gold Road’s Guyere Project from an exploration
play through to a fully funded 8.2Mtpa gold operation that
is set to produce 300koz per annum in joint venture with
Gold Fields Ltd.
All resolutions at General Meetings passed
Geopacific held its annual general meeting on 30 May 2019.
All resolutions were passed.
Geopacific held an extraordinary general meeting on 9
December 2019. All resolutions were passed.
Kou Sa Project, Cambodia
The Kou Sa Project (Kou Sa) is located in northern
Cambodia’s Chep District, Phreah Vihear province and
covers a license area of 158 square kilometres. A Maiden
Mineral Resource (2012 JORC Code compliant) of 51,000
tonnes of copper equivalent was released in 2016.
The Mineral Resource was calculated to assess the
project’s initial inventory at Prospects 150 and 160.
Geopacific believes Kou Sa holds significant potential for
the discovery of additional deposits with economic grade
and tonnage. A number of IP anomalies across the license
still remain untested.
No significant exploration activities took place during the
period and all opportunities to progress the project are
being investigated.
The Company is in negotiation with the vendors of the
Kou Sa Project to restructure the deferred consideration
payments. At 31 December 2019, payments of US$1.57
million and US$0.39 million were outstanding. In the
event an agreement cannot be reached with the vendors,
the Group will look to relinquish ownership of the Kou Sa
Project and would be required to pay US$0.50 million to the
vendors.
Fijian Gold and Copper Projects, Fiji
All licences have been relinquished or are in the process of
being relinquished. The office in Fiji has been closed and
Geopacific is investigating options to wind up the Fijian
entities.
13
2019 ANNUAL REPORT REVIEW OF OPERATIONS
FINANCIAL REVIEW
Loss After Tax
Loss Per Share (Cents)1
Cash and Cash Equivalents
Exploration and Evaluation Asset
- Additions (excluding transfers)
Mine Properties Under Development
Expenditure - Additions (excluding transfers)
Total Assets
2015
$
(2,000,637)
2016
$
(4,144,977)
2017
$
(4,042,911)
2018
$
(53,750,659)
2019
$
(7,337,714)
(0.25)
(0.45)
(0.27)
(2.49)
(6.48)
12,589,002
11,469,015
6,765,343
3,059,221
37,505,067
15,787,417
12,140,869
15,219,583
8,447,600
442,022
-
-
-
-
860,265
48,233,948
64,554,032
80,720,300
42,103,633
80,518,692
Net Assets
47,143,679
57,717,361
73,334,855
34,685,715
70,478,375
1 Earnings per share from 2015 to 2018 have not been adjusted to reflect the 25:1 share consolidation conducted in December 2019.
The Group recorded a net loss after tax for the year ended 31 December 2019 of $7,337,714 (2018: 53,750,659). This included
$1,501,751 (2018: Nil) of exploration costs that were expensed for the period.
During the 2019 reporting period, the Group made the decision to reclassify $30,461,193 (2018: Nil) of capitalised exploration
and evaluation expenditure associated with the Wooldark Gold Project to mine properties under development. This decision
followed the $40 Million Share Placement in October 2019 with funds being used to commence the development of the
Woodlark Gold Project.
At 31 December 2019, the Group’s total assets were $80,518,692 (2018: 42,103,633) and net assets were $70,478,375 (2018:
$34,685,715). The increase in the Group’s total assets and net assets relates to the proceeds from a $40 Million Placement
completed in October 2019.
14
2019 ANNUAL REPORT REVIEW OF OPERATIONS
MINERAL RESOURCES AND ORE RESERVES
Woodlark Mineral Resources and Ore Reserves
The Woodlark Mineral Resource is 47Mt @ 1.04g/t Au for 1.57Moz of gold7 including 222,000oz of gold in the Inferred
category (Table 1). There was no change to the Mineral Resources reported at 31 December 2018 for comparison.
Table 1: Woodlark Global Mineral Resource Estimate – March 2018
Category
(>0.4g/t lower cut)
Measured
Indicated
Inferred
Total
Tonnes
(Million)
21.24
18.94
6.8
47.04
Grade
g/t Au
1.10
0.98
1.00
1.04
Ounces
(Thousand)
754
597
222
1,573
An updated Ore Reserve estimate was released in November 2018 and was completed by independent consultants, Mining
Plus Pty Ltd (Mining Plus). The updated Ore Reserve estimate of 28.9Mt @ 1.12g/t Au for 1,037,600oz8 of gold is detailed
in Table 2.
Table 2: Woodlark Ore Reserve Estimate – November 2018
Total by deposit
Busai
Kulumadau
Woodlark King
Total Ore Reserve
Category
(>0.4g/t lower cut)
Proven
Probable
Proven
Probable
Proven
Probable
Proven
Probable
Total
Kou Sa Mineral Resources
Tonnes
(Million)
9.3
4.3
7.4
5.2
1.9
0.8
18.6
10.4
28.9
Grade
g/t Au
1.03
0.87
1.37
1.17
1.06
0.84
1.17
1.02
1.12
Ounces
(oz))
307,300
120,900
324,700
196,900
65,000
22,800
697,000
340,600
1,037,600
The Mineral Resource for Prospects 150 and 160 at the Kou Sa Project was 3.84 million tonnes at 0.77% Cu, 0.66g/t Au and
5.27g/t Ag for 51.2k tonnes of Cu equivalent. The Mineral Resource estimated at a 0.4% CuEq lower cut-off are detailed in
Table 3. There was no change to the Mineral Resources reported at 31 December 2018 for comparison.
Table 3: Kou Sa Global Mineral Resource Estimate – July 2016
Category
Indicated
Inferred
Total
Tonnes
(Million)
3.49
0.35
3.84
Cu
%
0.78
0.70
0.77
Au
g/t
0.71
0.20
0.66
Au
g/t
5.37
4.30
5.27
CuEq
%
1.38
0.90
1.33
Cu
Kt
27.1
2.30
Au
Koz
79.2
2.70
29.40
81.80
Ag
Koz
602
48
651
CuEq
Kt
48.1
3.1
51.2
7 Refer to March 2018 Pre-feasibility Study – ‘Robust Woodlark Gold project PFS Supports Development.
8 Refer to ‘Woodlark Ore Reserve Update’ announced on 7 November 2018.
15
2019 ANNUAL REPORT REVIEW OF OPERATIONS
Competent Persons Statement
Forward Looking Statements
in this report
All statements other than statements of historical fact
included
including, without limitation,
statements regarding future plans and objectives of
Geopacific Resources Ltd are forward-looking statements.
When used in this report, forward-looking statements can
be identified by words such as ‘may’, ‘could’, ‘believes’,
‘estimates’, ‘targets’, ‘expects’ or ‘intends’ and other
similar words that involve risks and uncertainties.
These statements are based on an assessment of present
economic and operating conditions, and on a number of
assumptions regarding future events and actions that,
as at the date of this report, are expected to take place.
Such forward-looking statements are not guarantees of
future performance and involve known and unknown risks,
uncertainties, assumptions and other important factors,
many of which are beyond the control of the company, its
directors and management of Geopacific that could cause
the Company’s actual results to differ materially from the
results expressed or anticipated in these statements.
Geopacific cannot and does not give any assurance that the
results, performance or achievements expressed or implied
by the forward-looking statements contained in this report
will actually occur and investors are cautioned not to place
undue reliance on these forward-looking statements. The
Company does not undertake to update or revise forward-
looking statements, or to publish prospective financial
information in the future, regardless of whether new
information, future events or any other factors affect the
information contained in this report, except where required
by applicable law and stock exchange listing requirements.
The information in this report that relates to Woodlark
Mineral Resources is based on information compiled and
reviewed by Mr Nicholas Johnson, a Competent Person who
is a Member of the Australian Institute of Geoscientists and
a full-time employee of MPR Geological Consultants Pty
Ltd. Mr Johnson has sufficient experience which is relevant
to the style of mineralization and type of deposits under
consideration and to the activity which he has undertaken to
qualify as a Competent Person as defined in the JORC Code
2012 and is a qualified person for the purposes of NI43-
101. Mr Johnson has no economic, financial or pecuniary
interest in the company and consents to the inclusion in
this report of the matters based on his information in the
form and context in which it appears.
The information in this report that relates to Woodlark Ore
Reserves is based on information compiled and reviewed
by Mr John Battista, a Competent Person who is a Member
and Chartered Professional of the Australian Institute of
Mining and Metallurgy (AusIMM) and a full-time employee
of Mining Plus. Mr Battista has sufficient experience
which is relevant to the style of mineralisation and type
of deposits under consideration and to the activity which
he has undertaken to qualify as a Competent Person as
defined in the JORC Code 2012 and is a qualified person
for the purposes of NI43-101. Mr Battista has no economic,
financial or pecuniary interest in the company and consents
to the inclusion in this report of the matters based on his
information in the form and context in which it appears.
The information in this report that relates to the Kou
Sa Mineral Resource estimate is based on information
compiled by Jonathon Abbott, a Competent Person who
is a Member of the Australian Institute of Geoscientists.
Jonathon Abbott is a full-time employee of MPR Geological
Consultants Pty Ltd and is an independent consultant to
Geopacific Resources Limited. Mr Abbott has sufficient
experience that is relevant to the style of mineralisation and
type of deposit under consideration and to the activity being
undertaking to qualify as a Competent Person as defined in
the 2012 Edition of the “Australasian Code for Reporting of
Mineral Resources and Ore Reserves”. Mr Abbott consents
to the inclusion in this report of the matters based on his
information in the form and context in which it appears.
16
2019 ANNUAL REPORT DIRECTORS’ REPORT
The Directors present their report together with the financial report of the Geopacific Group, being Geopacific Resources
Limited (“Geopacific” or “the Company”) and its controlled entities (“the Group” or “Consolidated entity”) for the financial
year ended 31 December 2019, and the auditor’s report thereon.
1
DIRECTORS AND COMPANY SECRETARY
The names of the Company’s Directors and Company Secretary in office during the financial year and until the date
of this report are as follows. Directors were in office for the entire period unless otherwise stated.
Name, Position Held & Qualification
Experience, Special Responsibilities & Other Directorships
Ian Clyne
Non-Executive Chairman
Assumed Role: 8 May 2019
Non-Executive Director
Appointed: 6 October 2016
B. Bus (Management)
Ron Heeks
Managing Director
Appointed: 28 March 2013
B. App. Sc (Geology)
Member of AusIMM
Mr Clyne has over 35 years’ experience in international banking having
worked in senior executive positions in ten countries in Asia, Oceania,
Australia and Europe. He has specialised in emerging markets and has
held roles of President, Director, Managing Director and Chief Executive
Officer with universal banking operations that have extensive branch
networks and large employee bases. Mr Clyne has successfully re-
engineered banks in Indonesia, Italy, Poland and Papua New Guinea.
Mr Clyne held the role of Managing Director and Group CEO of Bank South
Pacific (BSP), based in Port Moresby (2008 – 2013). He undertook a major
transformation program changing BSP from a typical emerging economy
banking institution into an innovative, technology driven, modern bank.
Under his leadership, the bank grew from having 400,000 accounts to
over 1 million in Papua New Guinea and 1.5 million across the Pacific,
including Fiji and the Solomon Islands, with a market capitalisation of
$1.7 billion at the end of his term.
Mr Clyne is also a member of the Audit and Risk Committee.
Mr Clyne is currently a Non-Executive Director of Union Bank of Nigeria.
Mr Clyne has not held any other directorships in the past three years.
Mr Clyne has the following interest in shares in the Company as at the
date of this report – 272,000 ordinary shares.
With 30 years’ mining industry experience, Mr Heeks was a founder of
Exploration and Mining Consultants and has had previous experience
with Western Mining Corporation, Newcrest, Newmont (US) and RSG
Consulting.
Mr Heeks has held senior roles in both mine management and exploration
and is a former General Manager – Technical for Straits Asia Indonesian
Operations and Chief Technical Officer for Adamus Resources Southern
Ashanti Gold Operation. He has lived and worked in various countries
around the world gaining extensive experience in South-East Asia and
Indonesia in particular.
Mr Heeks was appointed Managing Director of the Company on 28 March
2013 after the takeover of Worldwide Mining Projects Ltd.
During the past three years, Mr Heeks has also served as a director of
Kula Gold Limited (resigned 2 July 2019).
Mr Heeks has the following interest in shares in the Company as at the
date of this report – 449,832 ordinary shares.
17
2019 ANNUAL REPORT DIRECTORS’ REPORT
Name, Position Held & Qualification
Experience, Special Responsibilities & Other Directorships
Colin Gilligan
Non-Executive Director
Appointed: 26 June 2018
B. Sc Engineering (Mining) Hons
National Diploma - Coal Mining
Ian Murray
Non-Executive Director
Appointed: 9 September 2019
B. Com
Graduate Diploma in Accounting (GDA)
Advanced Taxation Certificate
Member of the Australian Institute of
Company Directors (MAICD)
Oxford Advanced Management &
Leadership Programme (OAMLP)
Fellow of the Australia & New Zealand
Institute of Chartered Accountants
(FCA)
Mr Gilligan is a mining engineer with over 25 years’ experience in the
resources sector, in Australia, South Africa, North America and Asia.
He has held technical, executive and director roles with a number
of companies throughout his career including Mitsui, Thiess, Anglo,
Coalspur Mines and Resource Generation.
During his career Mr Gilligan has provided leadership to a number of
operations, EPC contracts, mining contracts and development projects
across a range of commodities. He has also successfully contributed to
raising development funding in various forms.
Mr Gilligan brings a successful background in organisational leadership,
project development and delivery, predominantly achieved through a
focus on people, culture and optimal efficiency.
Mr Gilligan also contributes significant board level experience at private
and public company level, particularly on technical matters, governance,
funding, risk management, strategy and leadership.
Mr Gilligan is a member of the Audit and Risk Committee.
Mr Gilligan is currently an Independent Non-Executive Director at
Resource Generation Limited. Mr Gilligan has not held any other
directorships for the past three years.
Mr Gilligan held no interest in shares in the Company as at the date of
this report.
Mr Murray is a Chartered Accountant with over 25 years’ of mining
experience in senior leadership positions, including the position of
Managing Director of Gold Road Resources Limited (Gold Road) and
DRDGold Ltd. He has also held executive positions with international Big
4 accounting firms.
Mr Murray brings a wealth of financial, corporate, project development
and operational experience to the Board. Most recently he held the role
of Managing Director of Gold Road and was instrumental in taking the
Guyere Project from an exploration play through to a fully funded 8.2mtpa
gold operation that is set to produce 300koz per annum in joint venture
with Gold Fields Ltd.
Mr Murray is the Chairman of the Audit and Risk Committee.
Mr Murray is currently an Independent Non-Executive Director at Black
Rock Mining Ltd.
During the past three years, Mr Murray has also served as a director of
the following listed entities:
• Gold Road Resources Limited (retired January 2019); and
• Gascoyne Resources Limited (resigned October 2018)
Mr Murray held no interest in shares in the Company as at the date of
this report.
18
2019 ANNUAL REPORT DIRECTORS’ REPORT
Name, Position Held & Qualification
Experience, Special Responsibilities & Other Directorships
Matthew Smith
Company Secretary
Appointed: 1 December 2016
B. Com (Accounting)
Member of CAANZ
Milan Jerkovic
Non-Executive Chairman
Appointed: 23 April 2013
B. App. Sc (Geology)
Fellow of AusIMM
Member of AICD
Post Graduate Diploma in Mineral
Economics
Post Graduate Diploma in Mining
Resigned: 8 May 2019
Mr Smith has over 15 years’ experience in the resource industry across
a broad range of commodities including precious metals, industrials
and bulk commodities. Mr Smith has worked for a range of companies
operating in the Asia Pacific region and most recently held the role of
Chief Financial Officer at ASX listed Kingsrose Mining Limited, with gold
operations in Indonesia.
Mr Smith is a Chartered Accountant with relevant industry experience
being involved in a number of project funding transactions across debt
and equity markets. Mr Smith also brings specialist knowledge in the
areas of international taxation, corporate structuring, accounting and
corporate governance.
Mr Smith has previously held the role of Company Secretary at Straits
Resources Limited.
During the past three years, Mr Smith has also served as a director of
Kula Gold Limited (resigned 2 July 2019).
Mr Smith has the following interest in shares in the Company as at the
date of this report – 139,778 ordinary shares.
Mr Jerkovic is a qualified geologist with postgraduate qualifications in
Mining & Mineral Economics with over 30 years’ experience in the mining
industry involving resource evaluation, operations, financing, acquisition,
project development and general management.
Mr Jerkovic was the Chief Executive Officer of Straits Resources Limited
and has held positions with WMC, BHP, Nord Pacific, Hargraves, Tritton
and Straits Asia. Mr Jerkovic was the founding Chairman of Straits Asia
Resources and is currently Executive Chairman of Blackham Resources
Limited.
During the past three years, Mr Jerkovic has also served as a director of
Metals X Limited (resigned 2 September 2019).
Mr Jerkovic had the following interest in Shares in the Company as
at the date of his resignation – 13,196,677 ordinary shares (pre share
consolidation).
19
2019 ANNUAL REPORT DIRECTORS’ REPORT
Name, Position Held & Qualification
Experience, Special Responsibilities & Other Directorships
Mark Bojanjac
Non-Executive Director
Appointed: 28 March 2013
B. Com
Member of CAANZ
Resigned: 29 May 2019
Mr Bojanjac is a Chartered Accountant with over 20 years’ experience in
developing resource companies. Mr Bojanjac was a founding director of
Gilt-Edged Mining Limited which discovered one of Australia’s highest
grade gold mines and was managing director of a public company which
successfully developed and financed a 2.4 million ounce gold resource
in Mongolia. He also co-founded a 3 million ounce gold project in China.
Mr Bojanjac was most recently Chief Executive Officer of Adamus
Resources Limited and oversaw its advancement from an early stage
exploration project through its definitive feasibility studies, and managed
the debt and equity financing of its successful Ghanaian gold mine.
Mr Bojanjac was appointed a Director of the Company on 28 March 2013
after the takeover of Worldwide Mining Projects Ltd.
Mr Bojanjac serves as Executive Chairman of Canadian explorer PolarX
Limited and Non-Executive Director of Kula Gold Limited. Mr Bojanjac
has not held any other directorships for the past three years.
Mr Bojanjac had the following interest in shares in the Company as
at the date of his resignation – 3,416,666 ordinary shares (pre share
consolidation).
20
2019 ANNUAL REPORT DIRECTORS’ REPORT
2
PRINCIPAL ACTIVITY
The principal activity of the Group is mineral development exploration focused on gold and copper deposits in Papua
New Guinea and Cambodia.
There were no significant changes in the nature of this activity of the Group during the financial year.
3
OPERATING AND FINANCIAL REVIEW
A review of the operations and financial position of the Group during the year ended 31 December 2019, including
details of the results of operations, changes to the state of affairs, and likely developments in the operation of the
Group in subsequent financial years is set out in the Operations Review.
4
DIVIDENDS
No dividends were paid or declared during the financial year (2018: None).
5
STATE OF AFFAIRS
There have not been any significant changes in the state of affairs of the Group during the financial year, other than
those noted in the financial report.
6
EVENTS SUBSEQUENT TO REPORTING DATE
Subsequent to end of the financial year, the COVID-19 outbreak was declared a pandemic by the World Health
Organisation in March 2020.
The outbreak and the response of Governments in dealing with the pandemic is interfering with general activity
levels within the community, the economy and the operations of Geopacific’s business.
As a result of COVID-19, in March 2020 the Group implemented the following measures:
• A notice of suspension was issued to HBS, the contractor engaged to undertake a Civil Works Program;
• All HBS staff were repatriated from Woodlark Island to ensure a safe passage to their home countries;
• All HBS equipment remains on site;
• Rhodes remain on site to continue the village relocation program;
• Rhodes and HBS will not be permitted to bring new personnel to Woodlark Island until it is considered
safe to do so;
• All Geopacific expatriate staff were repatriated from Woodlark Island to Australia; and
• Staff based in the Perth Office will comply with both domestic and international travel restrictions and where
possible, work from home to ensure the Company complies with social distancing guidelines.
The scale and duration of the developments associated with COVID-19 remain uncertain as at the date of this report.
However, they could impact on the Group’s ability to raise equity and the Group’s financial results, cash flow and
financial position in future years.
It is not possible to estimate the impact relating to the near-term and longer effects of COVID-19, or Governments’
varying efforts to combat the outbreak and support businesses. This being the case, we do not consider it practicable
to provide a quantitative or qualitative estimate of the potential impact of this outbreak on the Group at this time.
The financial statements have been prepared based upon conditions existing at 31 December 2019 and due
consideration has been given to events that have occurred subsequent to 31 December 2019 that provide evidence of
conditions that existed at the end of the reporting period. As the outbreak of COVID- 19 occurred after 31 December
2019, its impact is considered an event that is indicative of conditions that arose after the reporting period and
accordingly, no adjustments have been made to financial statements as at 31 December 2019 for any impacts of
COVID-19.
Other than the matter discussed above, no other matters or circumstances haves arisen since the end of the
financial period year which significantly affected or may significantly affect the operations of the Group, the results
of those operations, or the state of affairs of the Group in future financial years.
21
2019 ANNUAL REPORT
DIRECTORS’ REPORT
7
DIRECTORS’ INTERESTS AND BENEFITS
The relevant interest of each Director in the share capital as notified by the Directors to the Australian Securities
Exchange in accordance with section 205G(1) of the Corporations Act 2001, at the date of this report is as follows:
Name
I Clyne
C Gilligan
I Murray
R Heeks
Shares
272,000
-
-
Direct
Options
-
-
-
Rights
Shares
Indirect
Options
Rights
-
-
-
-
-
-
-
-
-
-
-
-
-
-
167,556
1,111,690
498,337
282,276
8
DIRECTORS’ MEETINGS
The number of Directors’ meetings (including meetings of committees) and the number of meetings attended by
each of the Directors of the Company during the financial year are set out below:
Name
I Clyne
C Gilligan
I Murray
R Heeks
M Jerkovic
M Bojanjac
Directors Meetings
Audit and Risk Committee Meetings
Attended*
Eligible to Attend
Attended*
Eligible to Attend
10
11
4
11
5
5
11
11
4
11
5
5
2
2
-
-
1
1
2
2
-
-
1
1
* Either in person, or by electronic means.
The Board of Directors takes ultimate responsibility for corporate governance. This includes the establishment
of compensation arrangements for the Company’s Executive Directors and senior executives. It also includes the
appointment and retirement of Non-Executive Directors, appointment of Auditors, monitoring key areas of business
risk, maintenance of ethical standards and Audit and Risk Committees. The Board seeks independent professional
advice as necessary in carrying out its duties and responsibilities.
9
LIKELY DEVELOPMENTS, PROSPECTS AND BUSINESS STRATEGIES
The Group will continue to advance its development and exploration portfolio and seek to increase its tenement
holdings by acquiring further projects.
10 ENVIRONMENTAL REGULATIONS
Entities in the Group are subject to normal environmental regulations in areas of operations in Papua New Guinea,
Cambodia and Fiji. There have been no breaches of these regulations during the financial year, or in the period
subsequent to the end of the financial year and up to the date of this report.
22
2019 ANNUAL REPORT DIRECTORS’ REPORT
11 SHARE OPTIONS
There were 4,700,324 Options over unissued shares unexercised at 31 December 2019 (2018 – 62,673,263). During
the 2019 reporting period, the Company issued 17,188,888 shares on the exercise of unlisted Options. Since the end
of the 2019 reporting period and up to the date of this report, no unlisted Options have been cancelled or exercised.
Details of unlisted Options over unissued shares in the Company as at the date of this report are presented in the
following table:
Options on Issue
Exercise Price
Expiry Date
32,000
8,000
520,131
970,638
808,740
1,296,965
1,063,850
$62.50
$125.00
$0.00
$0.00
$1.02
$0.00
$0.58
Not later than 5-years after defining a JORC compliant ore
reserve of over 200,000oz Au on the Faddy’s Gold Deposit
Not later than 10-years after defining a JORC compliant ore
reserve of over 1,000,000oz Au on the Faddy’s Gold Deposit
19 July 2020
10 July 2021
10 July 2022
19 July 2022
19 July 2023
* The above Options have been adjusted for the 25:1 share consolidation completed in December 2019.
Option holders do not have any rights to participate in any issues of shares or other interest in the Company or any
other entity.
12 SHARE APPRECIATION RIGHTS
There were 2,023,706 share appreciation rights over unissued shares unexercised at 31 December 2019 (2018 –
22,365,071). During the 2019 reporting period, the Company did not issue any shares on the exercise of unlisted
share appreciation rights. Since the end of the 2019 reporting period and up to the date of this report, no unlisted
share appreciation rights have been cancelled or exercised.
Details of unlisted share appreciation rights over unissued shares in the Company as at the date of this report are
presented in the following table:
Share appreciation rights on Issue
Exercise Price
894,605
1,129,101
$0.71
$0.40
Expiry Date
10 July 2022
19 July 2023
* The above Share Appreciation Rights have been adjusted for the share consolidation completed in
December 2019.
13
INSURANCE OF OFFICERS
The Company has paid a premium to insure the Directors and Company Secretary of the Group in respect of certain
legal liabilities, including costs and expenses in successfully defending legal proceedings, whilst they remain as
Directors and for seven years thereafter. The insurance contract prohibits the disclosure of the total amount of the
premiums and a summary of the nature of the liabilities insured.
14 PROCEEDINGS ON BEHALF OF COMPANY
No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings on
behalf of the Company, or to intervene in any proceedings to which the Company is a party, for the purpose of taking
responsibility on behalf of the Company for all or part of those proceedings.
No proceedings have been brought or intervened in on behalf of the Company with leave of the Court under section
237 of the Corporations Act 2001.
23
2019 ANNUAL REPORT
DIRECTORS’ REPORT
15 AUDITOR’S INDEPENDENCE DECLARATION
The auditor’s independence declaration for the year ended 31 December 2019 is set out on page 40.
16 AUDITOR
The Company’s auditor is Ernst & Young.
The Company has agreed with Ernst & Young, as part of its terms of engagement, to indemnify Ernst & Young
against certain liabilities to third parties arising from the audit engagement. The indemnity does not extend to any
liability resulting from a negligent, wrongful or wilful act or omission by Ernst & Young.
During the financial year the Company has not paid any premium in respect to any insurance for Ernst & Young or a
body corporate related to Ernst & Young.
During the year, the following fees were paid or payable to the auditors of the Company for services provided by the
auditor of the Company and its subsidiaries, its related practices and non-related audit firms:
Audit Services
Greenwich & Co
Audit and review of the financial report and other audit work under the
Corporations Act 2001
Other non-audit services
Ernst & Young
Audit and review of the financial report for Geopacific Resources
Limited and its controlled subsidiaries and other audit work under the
Corporations Act 2001
Total
17 NON-AUDIT SERVICES
Consolidated
2019
$
-
-
2018
$
12,091
2,200
57,500
57,500
67,500
81,791
The Directors are satisfied that the provision of non-audit services is compatible with the general standard of
independence for auditors imposed by the Corporations Act 2001. The nature and scope of each type of non-audit
service provided means that auditor independence was not compromised.
24
2019 ANNUAL REPORT DIRECTORS’ REPORT
18 REMUNERATION REPORT - AUDITED
This report outlines the remuneration arrangements of the Group pursuant to the requirements of the Corporations
Act 2001 and its regulations. This information has been audited as required under section 308(3)(c) of the Corporations
Act 2001.
This report details the remuneration arrangements of the Group’s key management personnel (KMP), who are
defined as those persons who have the authority and responsibility for planning, directing and controlling the major
activities of the Group, directly or indirectly, including any Director of Geopacific.
Details of the KMP of the Group during the reporting period are set out in the table below:
Name
Non-Executive Directors
Ian Clyne
Colin Gilligan
Ian Murray
Milan Jerkovic
Mark Bojanjac
Executives
Ron Heeks
Matthew Smith
Glenn Zamudio
Jim Kerr
Position
Non-Executive Chairman
Non-Executive Director
Appointed – 9 September 2019
Non-Executive Director
Resigned – 8 May 2019
Non-Executive Chairman
Resigned – 29 May 2019
Non-Executive Director
Managing Director
Chief Financial Officer & Company Secretary
General Manager - Projects
Resigned – 31 May 2019
General Manager - Geology
There were no changes to KMP other than those noted above after the reporting date and before the date the
financial report was authorised for issue.
Remuneration Governance
Due to the size and structure of the Board, during the 2019 reporting period the Company did not have a separate
Remuneration Committee. Remuneration matters were dealt with by the full Board, with Directors excluded from
individual discussions as required.
The Board was responsible for reviewing and recommending the remuneration arrangements of the Group KMP
and ensuring that the Group’s remuneration structures are aligned with the interests of the Company and its
shareholders. This includes an annual remuneration review of base salary (including superannuation), short term
incentives (STI) and long term incentives (LTI), including the appropriateness of performance hurdles.
In preparation for the development of the Woodlark Gold Project, the Board has subsequently decided to establish
a Remuneration Committee during the 2020 reporting period.
Remuneration Consultants
During the 2017 reporting period, BDO Chartered Accountants developed a comprehensive remuneration framework
for the Company to provide recommendations as defined in section 9B of the Corporations Act 2001.
The remuneration framework was further refined and approved by shareholders at the Annual General Meeting
(AGM) held on 30 May 2018.
The Company engaged BDO Chartered Accountants in December 2019 to complete a benchmarking exercise
which included an update to the comparison peer group of companies and a refresh of the underlying peer group
remuneration data. The review is expected to be completed in the first quarter of 2020.
No fees were paid in respect of remuneration consulting during 2019.
25
2019 ANNUAL REPORT
DIRECTORS’ REPORT
18 REMUNERATION REPORT – AUDITED (CONTINUED)
Remuneration Overview and Strategy
The objective of the Group’s remuneration framework is to support the delivery of sustained shareholder value
and to ensure rewards accurately reflect achievements in line with general market conditions. The strategy is
designed to attract, motivate and retain high calibre individuals through the provision of remuneration packages
that incorporate a balance of fixed and variable remuneration. In accordance with sound corporate governance
practices, the structure of Non-Executive and Executive remuneration is separate and distinct. There is no direct
relationship between remuneration and the financial performance of the Group.
The following table shows the Group’s performance over the reporting period and the previous four financial years
and against overall remuneration for these years:
2015
$
2016
$
2017
$
2018
$
2019
$
Loss Per Share (Cents) (i)
0.25
0.45
0.27
2.49
Year-end share price (Cents) (i)
0.041
0.036
0.027
0.016
Market capitalisation ($ million)
32.8
41.6
48.7
33.3
6.48
0.50
87.3
Total KMP remuneration ($)
1,033,501
1,011,937
1,468,516
2,196,274
2,127,902
(i) The loss per share and year-end share price from 2015 to 2018 has not been adjusted to reflect the 25:1 share
consolidation conducted in December 2019.
Executive Remuneration Framework
The Board’s objective is to reward Executives with a quantum and mix of remuneration commensurate with their
position and responsibilities and that is competitive within the marketplace. With this in mind, the Company
remunerates its Executives with a mix of both fixed and at risk, or variable, remuneration. Variable remuneration
incorporates a balance of short, medium and long term incentives.
Fixed remuneration for Executives consists of base salary, Zero Exercise Price Options (ZEPO’s), superannuation
and other non-cash benefits. It is designed to provide a base level of remuneration which is appropriate for the
Executives’ position, reflecting the individual’s skills, level of experience and responsibilities.
Variable remuneration, or performance linked remuneration, includes a combination of short, medium and long
term incentives designed to provide an “at risk” reward in a manner which aligns with the creation of sustained
shareholder value.
All Executives are eligible to receive short, medium and long term incentives which can be issued in accordance
with the Company’s Securities Incentive Plan (Incentive Plan) that was approved by shareholders at the AGM held
on 30 May 2018.
The Incentive Plan incorporates a 5% cap on the total shares that can be issued to Executives pursuant to the plan.
26
2019 ANNUAL REPORT
DIRECTORS’ REPORT
18 REMUNERATION REPORT – AUDITED (CONTINUED)
The following table provides a high level summary of the Company’s remuneration framework:
Fixed
remuneration
Remuneration linked to market
rate of the role.
Total fixed
remuneration
Remuneration for meeting role
requirements.
Variable
remuneration
Incentive
Remuneration for delivering
on key milestones which are
designed to create value for
shareholders.
Short term
incentive
Incentive for the achievement of
annual objectives.
Medium term
incentive
Incentive for the achievement of
sustained business value.
Variable
remuneration
Reward
Remuneration for the creation of
value for shareholders - directly
linked to shareholder returns.
Long term
incentive
Reward for performance over
the long term.
The Incentive Plan provides for the use of a range of equity based instruments to deliver incentives which focus
participants on the delivery of sustained shareholder value and minimise the cash outlay associated with total
remuneration. The various components of the Incentive Plan are outlined below.
Fixed Remuneration Correction Plan
The fixed remuneration correction plan was designed to align total fixed remuneration with market rates using a
share based payment rather than cash. In order to determine appropriate market rates, a peer group consisting
of fourteen development and exploration companies across a range of commodities was selected on the basis of:
• Company size by reference to market capitalisation;
• Scale and stage of development of projects; and
• Geographic operating locations.
Independent analysis completed by BDO Chartered Accountants in the 2017 reporting period determined that a gap
existed between the total fixed remuneration of the Company’s executives in comparison to the Peer Group for given
roles.
In order to ameliorate the gap, BDO Chartered Accountants recommended the issue of Class A Options in the form
of Zero Exercise Price Options (ZEPO’s) for the difference between:
•
•
the 50th percentile of peer group total fixed remuneration for their given role; versus
the participants’ total cash based annual fixed remuneration.
Class A Options are issued annually in advance, for no consideration and have an exercise price of nil. As the Class
A Options are issued as part of the fixed remuneration correction plan, no vesting conditions are attached other than
the continuation of service, which can be waived at the discretion of the Board.
The value of any Class A Options is included in the Executives’ total fixed remuneration for the period. During the
year, Class A Options were issued with a one year vesting period in relation to services performed for the 2019
financial year.
27
2019 ANNUAL REPORT
DIRECTORS’ REPORT
18 REMUNERATION REPORT – AUDITED (CONTINUED)
Incentive Plan
The Incentive Plan is linked to the achievement of milestones that are set each calendar year by the Board. The
Board selects milestones that are intended to drive sustained returns for shareholders. Following the completion of
each calendar year, the Board determines which performance milestones were satisfied in the prior year in order to
calculate the quantum of instruments to be issued.
The total incentive plan opportunity, which represents the maximum incentive that could be issued is determined
as follows:
• 190% of total fixed remuneration for the Managing Director; and
• 160% of total fixed remuneration for all other participants.
The total incentive plan opportunity is divided up between a cash based bonus and a range of equity based
instruments. Each element is given a weighting designed to provide an appropriate mix of short, medium and long
term incentives for participants.
During the reporting period, instruments were issued under the Incentive Plan in relation to milestones that were
achieved during the 2018 calendar year. The Board determined that two out of the five performance milestones
had been satisfied, resulting in the award of up to 45% of the total incentive opportunity.
The milestones that were set for the 2018 reporting period are outlined in the following table:
2018 Milestone
1. Release of a Definitive Feasibility Study for the Woodlark Gold Project.
2. Restructure the Group.
3. Mineral Resource growth (JORC 2012) of greater than 10% at the Woodlark
Gold Project.
4. Release of a new Ore Reserve Statement for the Woodlark Gold Project
containing greater than 1 million ounces of gold.
Weighting
30%
25%
15%
15%
Board
Assessment
Achieved.
Not achieved.
Not achieved.
Achieved.
5. Board acceptance of a funding solution for the development of the Woodlark
15%
Not achieved.
Gold Project.
The table below outlines the maximum percentages available along with the percentages awarded based on the
milestones met:
Plan Element
Instrument
Maximum
Available
Incentive
Awarded
Maximum
Available
Incentive
Awarded
Vesting
Period
Exercise
Price
Conditions
Managing Director
Other Participants
Short term
incentive
Medium term
incentive
Long term
incentive
Long term
incentive
Cash based
bonus
Class B
Options -
ZEPOs
Class C
Options –
Premium
Exercise
Price Options
(PEPOs)
Share
Appreciation
Rights (SARs)
11%
Nil
11%
Nil
N/A
N/A
N/A
45%
20%
45%
20%
3 years
Nil
21%
9%
19%
8%
4 years
143% of the
Company’s
share price
at grant
date(i)
23%
11%
24%
11%
3 years
Nil(ii)
Continuation
of service
Continuation
of service
Continuation
of service
Total
100%
40%
100%
39%
(i) The exercise price was adjusted for the 25:1 share consolidation in December 2019.
(ii) Exercise price of SAR’s - theoretical exercise price is the Company’s share price at grant date.
28
2019 ANNUAL REPORT
DIRECTORS’ REPORT
18 REMUNERATION REPORT – AUDITED (CONTINUED)
Incentive Plan (Continued)
The Board, in exercising its discretion, determined that cash based bonuses would not be paid during the reporting
period.
The Board also set annual milestones in respect of the 2019 reporting period. In February 2020, the Board determined
that three out of the five performance milestones set in relation to the 2019 reporting period had been satisfied.
The milestones that were set for the 2019 reporting period are outlined in the following table:
2019 Milestone
Weighting
Board
Assessment
1. Raise sufficient funding from capital markets to commence development at
20%
Achieved.
the Woodlark Gold Project.
2. Restructure the Group via corporate transaction/s to secure 100% direct
ownership of Woodlark Mining Limited
3. Rebalance the Company’s share registry through the attraction of new
institutional shareholders representing greater than 20% of the issued
capital.
20%
20%
Achieved.
Achieved.
4. Board acceptance and implementation of a restructure or divestment of the
20%
Not achieved.
Group’s non-core assets in Fiji and Cambodia.
5. Board acceptance of a financing solution for the development of the
20%
Not achieved.
Woodlark Gold Project (Stretch Target).
No incentives have been issued in respect the 2019 milestones. The award of incentives relating to the 2019 reporting
period will be subject to shareholder approval at the Company’s 2020 Annual General Meeting (AGM).
Non-Executive Directors
Fees and payments to Non-Executive Directors reflect the demands, which are made on, and the responsibilities of
the Directors. A review of Non-Executive Directors’ fees and payments is conducted annually. The Board may from
time to time seek the advice of independent remuneration consultants to ensure Non-Executive Directors’ fees and
payments are appropriate in the market setting.
The Chairman’s fees are determined independently to the fees of Non-Executive Directors based on comparative
roles in market. The Chairman is not present at any discussions relating to determination of his own remuneration.
Directors’ fees
Non-Executive Directors’ fees are determined within an aggregate Directors’ fee pool limit, which is periodically
recommended for approval by shareholders. The pool limit currently stands at $400,000 per year in aggregate as
agreed at the 2012 AGM.
A Director may also be paid fees or other amounts if special duties are performed outside the scope of normal
duties of a Director. A Director may also be reimbursed for out of pocket expenses incurred as a result of their
directorship or any special duties.
29
2019 ANNUAL REPORT
DIRECTORS’ REPORT
18 REMUNERATION REPORT – AUDITED (CONTINUED)
Details of Remuneration
The tables below set of the details of the remuneration of the Group’s KMP, as required by Section 308(3C) of the
Corporations Act 2001.
Short Term Benefits
Post Employment
Benefits
Share
Based
Payments
Long
Term
Benefits
Performance
Related
Salaries
& Fees
Annual
Leave Bonus
Super-
annuation
Termination
Payments
Options &
Rights
Long
Service
Leave
2019
$
$
$
$
$
$
$
Non-Executive Directors
M Jerkovic (i)
M Bojanjac (ii)
I Clyne
C Gilligan
I Murray (iii)
33,494
25,000
82,660
60,000
18,815
NED Sub total
219,969
Executive Directors
R Heeks
Executive Directors
Sub total
330,000
330,000
-
-
-
-
-
-
-
-
Other KMP
M Smith
G Zamudio
J Kerr (iv)
206,731 17,692
178,462 26,538
75,000
-
Other KMP Sub total 460,193 44,230
TOTAL
1,010,162 44,230
-
-
-
-
-
-
-
-
-
-
-
-
-
3,182
2,375
7,853
5,700
1,787
20,897
-
-
20,900
19,475
-
-
-
-
-
-
-
-
-
-
Total
$
36,676
27,375
102,066
65,700
20,602
252,419
%
-
-
11
-
-
473,606
30
473,606
-
-
11,553
-
-
11,553
143,606
143,606
-
-
-
-
-
-
-
-
183,498
2,817
431,638
183,498
3,045
411,018
43
45
82
7,125
20,769
456,327
-
559,221
47,500
20,769
823,323
5,862
1,401,877
68,397
20,769
978,482
5,862
2,127,902
(i)
(ii)
(ii)
(iv)
Mr M Jerkovic resigned on 8 May 2019
Mr M Bojanjac resigned on 29 May 2019
Mr I Murray commenced on 9 September 2019
Mr J Kerr resigned on 31 May 2019. On this date, the Board approved that Mr J Kerr would be entitled to his
unvested Options and Rights, waiving the service period normally required as at the date he ceased employment.
This resulted in an accelerated expensing profile relating to share based payments. Geopacific’s share price
on that date was $0.013. The fair value of these grants was not changed at the date of modification and the
remaining vesting conditions assigned to his options and rights were not modified on this date.
30
2019 ANNUAL REPORT
DIRECTORS’ REPORT
18 REMUNERATION REPORT – AUDITED (CONTINUED)
Details of Remuneration (continued)
Short Term Benefits
Post Employment
Benefits
Share
Based
Payments
Long
Term
Benefits
Performance
Related
Salaries &
Fees
Annual
Leave Bonus
Super-
annuation
Termination
Payments
Options &
Rights
Long
Service
Leave
2018
$
$
$
$
$
$
$
Non-Executive Directors
M Jerkovic
M Bojanjac
I Clyne
C Gilligan (i)
95,000
60,000
60,000
25,000
NED Sub total
240,000
Executive Directors
R Heeks
P Leggat (ii)
Executove Directors
Sub total
330,000
140,000
470,000
-
-
-
-
-
-
-
-
Other KMP
M Smith
G Zamudio
J Kerr
210,000 14,538
180,000
6,923
180,000
2,423
Other KMP Sub total
570,000 23,884
TOTAL
1,280,000 23,884
-
-
-
-
-
-
-
-
-
-
-
-
-
9,025
5,700
5,700
2,375
22,800
-
-
-
-
-
-
-
-
-
10,948
-
10,948
50,311
24,938
140,000
333,336
24,938
140,000
383,647
-
-
-
-
-
-
-
-
Total
$
104,025
65,700
76,648
27,375
273,748
380,311
638,274
1,018,585
19,950
17,100
17,100
54,150
-
-
-
-
83,849
1,597
329,934
83,849
1,369
289,241
83,849
1,394
284,766
251,547
4,360
903,941
101,888
140,000
646,142
4,360
2,196,274
%
-
-
14
-
13
52
25
29
29
(i)
(ii)
Mr C Gilligan commenced on 26 June 2018
Ms P Leggat resigned on 10 September 2018. On this date, the Board approved that Ms P Leggat would be
entitled to her unvested Options and Rights, waivingthe service period normally required as at the date she
ceased employment. This resulted in an accelerated expensing profile. Geopacific’s share price on that date was
$0.022. The fair value of these grants was not changed at the date of modification and the remaining vesting
conditions assigned to her options and rights were not modified on this date.
31
2019 ANNUAL REPORT
DIRECTORS’ REPORT
18 REMUNERATION REPORT – AUDITED (CONTINUED)
Service Agreements
A summary of the key terms of the Director contracts with the Company are set out below:
Ian Clyne - Non-Executive Chairman
• Directors Fees of $95,000 per annum (following assumption of Non-Executive Chairman role on 9 September 2019);
• Statutory superannuation contributions;
• Eligible to participate in the long-term incentive schemes offered by the Company; and
• No Notice Period.
Colin Gilligan - Non-Executive Director
• Directors Fees of $60,000 per annum;
• Statutory superannuation contributions;
• Eligible to participate in the long-term incentive schemes offered by the Company; and
• No Notice Period.
Ian Murray - Non-Executive Director (appointed 9 September 2019)
• Directors Fees of $60,000 per annum;
• Statutory superannuation contributions;
• Eligible to participate in the long-term incentive schemes offered by the Company; and
• No Notice Period.
Ron Heeks – Managing Director
• Consulting Fees of $330,000 per annum;
• Eligible to participate in the long-term incentive schemes offered by the Company; and
• Six month notice period plus an additional one month for each year of service.
Milan Jerkovic - Non-Executive Chairman (resigned 8 May 2019)
• Directors Fees of $95,000 per annum;
• Statutory superannuation contributions;
• Eligible to participate in the long-term incentive schemes offered by the Company; and
• No Notice Period.
Mark Bojanjac - Non-Executive Director (resigned 29 May 2019)
• Directors Fees of $60,000 per annum;
• Statutory superannuation contributions;
• Eligible to participate in the long-term incentive schemes offered by the Company; and
• No Notice Period.
Short-term Incentives
No bonus payments were made to Directors of the Company or other KMP of the Group during the period and all
potential benefits under the short term incentive plan were forfeited.
32
2019 ANNUAL REPORT
DIRECTORS’ REPORT
18 REMUNERATION REPORT – AUDITED (CONTINUED)
Long-term Incentives - Share-based Compensation
Options
Options over ordinary shares in the Company were provided as remuneration to Directors of the Company and
KMP of the Group during the year as per the Securities Incentive Plan, which was approved by shareholders at the
Company’s AGM held on 30 May 2018. The following table outlines the Options granted or vested during the 2019
reporting period to the Directors of the Company and other KMP of the Group.
Options
granted
during
the year Grant date
Fair
value per
option
at grant
date
Value of
option
at grant
date ($)
Vesting
date
Exercise
price
Expiry
date
Options
vested/
lapsed
during the
year
2019
Instru-
ment
Year
Executive Directors
R Heeks
ZEPO
2019
261,538 30-May-19
$0.014
3,662
19-Jul-20 $0.00
19-Jul-20
R Heeks
ZEPO
2019 9,174,808 30-May-19
$0.014
128,448
19-Jul-22 $0.00
19-Jul-22
R Heeks
PEPO 2019 7,951,500 30-May-19
$0.008
63,612
19-Jul-23 $0.0233
19-Jul-23
Other KMP
M Smith
ZEPO
2019 4,838,462 12-Jul-19
$0.016
77,416
19-Jul-20 $0.00
19-Jul-20
M Smith
ZEPO
2019 6,336,000 12-Jul-19
$0.016
101,376
19-Jul-22 $0.00
19-Jul-22
M Smith
PEPO 2019 5,081,143 12-Jul-19
$0.009
45,730
19-Jul-23 $0.0233
19-Jul-23
G Zamudio
ZEPO
2019 4,838,462 12-Jul-19
$0.016
77,416
19-Jul-20 $0.00
19-Jul-20
G Zamudio
ZEPO
2019 6,336,000 12-Jul-19
$0.016
101,376
19-Jul-22 $0.00
19-Jul-22
G Zamudio PEPO 2019 5,081,143 12-Jul-19
$0.009
45,730
19-Jul-23 $0.0233
19-Jul-23
J Kerr
J Kerr
J Kerr
ZEPO
2019 2,016,026 12-Jul-19
$0.016
32,257
19-Jul-20 $0.00
19-Jul-20
ZEPO
2019 5,441,852 12-Jul-19
$0.016
87,070
19-Jul-22 $0.00
19-Jul-22
PEPO 2019 4,364,083 12-Jul-19
$0.009
39,277
19-Jul-23 $0.0233
19-Jul-23
-
-
-
-
-
-
-
-
-
-
-
-
All instruments issued during the 2019 reporting period were issued on 2 August 2019 prior to the 25:1 share
consolidation that took place in December 2019. All instruments were adjusted at the time of the consolidation to
reduce the number of instruments (reduced 25:1) and increase the exercise price (increased 25:1) where relevant.
The grant date differs for the directors to comply with the accounting standards.
33
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DIRECTORS’ REPORT
18 REMUNERATION REPORT – AUDITED (CONTINUED)
Long-term Incentives - Share-based Compensation (Continued)
Options (continued)
The following table outlines the Options granted or vested during the 2018 reporting period to the Directors of the
Company and other KMP of the Group.
Options
granted
during
the year Grant date
Fair
value per
option
at grant
date
Value of
option
at grant
date ($)
Vesting
date
Exercise
price
Expiry
date
Options
vested/
lapsed
during the
year
2018
Instru-
ment
Year
Non-Executive Directors
I Clyne
ZEPO 2018
750,000 30-May-18
$0.030
22,500
10-Jul-19 $0.00
10-Jul-19
Executive Directors
R Heeks
ZEPO
2017
94,444 30-May-18
$0.030
2,834
10-Jul-19 $0.00
10-Jul-19
R Heeks
ZEPO
2018
94,444 30-May-18
$0.030
2,834
10-Jul-19 $0.00
10-Jul-19
R Heeks
ZEPO
2018 5,521,875 30-May-18
$0.030
165,656
10-Jul-21 $0.00
10-Jul-21
R Heeks
PEPO 2018 4,882,500 30-May-18
$0.016
78,120
10-Jul-22 $0.0408
10-Jul-22
P Leggat
ZEPO
2017 1,747,222 30-May-18
$0.030
52,417
10-Jul-19 $0.00
10-Jul-19
P Leggat
ZEPO
2018 1,747,222 30-May-18
$0.030
52,417
10-Jul-19 $0.00
10-Jul-19
P Leggat
ZEPO
2018 3,813,333 30-May-18
$0.030
114,400
10-Jul-21 $0.00
10-Jul-21
P Leggat
PEPO 2018 3,120,000 30-May-18
$0.016
49,920
10-Jul-22 $0.0408
10-Jul-22
Other KMP
M Smith
ZEPO
2017 1,747,222 3-Jul-18
$0.030
52,417
10-Jul-19 $0.00
10-Jul-19
M Smith
ZEPO
2018 1,747,222 3-Jul-18
$0.030
52,417
10-Jul-19 $0.00
10-Jul-19
M Smith
ZEPO
2018 3,813,333 3-Jul-18
$0.030
114,400
10-Jul-21 $0.00
10-Jul-21
M Smith
PEPO 2018 3,120,000 3-Jul-18
$0.016
49,920
10-Jul-22 $0.0408
10-Jul-22
G Zamudio
ZEPO
2017 1,747,222 3-Jul-18
$0.030
52,417
10-Jul-19 $0.00
10-Jul-19
G Zamudio
ZEPO
2018 1,747,222 3-Jul-18
$0.030
52,417
10-Jul-19 $0.00
10-Jul-19
G Zamudio
ZEPO
2018 3,813,333 3-Jul-18
$0.030
114,400
10-Jul-21 $0.00
10-Jul-21
G Zamudio PEPO 2018 3,120,000 3-Jul-18
$0.016
49,920
10-Jul-22 $0.0408
10-Jul-22
J Kerr
J Kerr
J Kerr
J Kerr
ZEPO
2017 1,747,222 3-Jul-18
$0.030
52,417
10-Jul-19 $0.00
10-Jul-19
ZEPO
2018 1,747,222 3-Jul-18
$0.030
52,417
10-Jul-19 $0.00
10-Jul-19
ZEPO
2018 3,813,333 3-Jul-18
$0.030
114,400
10-Jul-21 $0.00
10-Jul-21
PEPO 2018 3,120,000 3-Jul-18
$0.016
49,920
10-Jul-22 $0.0408
10-Jul-22
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
All unexercised instruments were adjusted for the 25:1 share consolidation that took place in December 2019 to
reduce the number of instruments (reduced 25:1) and increase the exercise price (increased 25:1) where relevant.
The fair value of the Options is measured at grant date and allocated equally over the period from grant date
to vesting date, unless Directors of the Company and KMP of the Group resign during the vesting period in
which case the fair value of the Options is expensed immediately. This allocation is reflected in the Share Based
Payments column of the remuneration tables above.
The fair value at grant date was determined by a combination of internal and external sources using a Black-
Scholes option pricing model and independent third party valuations.
34
2019 ANNUAL REPORT
DIRECTORS’ REPORT
18 REMUNERATION REPORT – AUDITED (CONTINUED)
Long-term Incentives - Share-based Compensation (Continued)
Share Appreciation Rights
Share Appreciation Rights over ordinary shares in the Company were granted as remuneration to Directors of
the Company and KMP of the Group during the year as per the Securities Incentive Plan, which was approved by
shareholders at the Company’s AGM held on 30 May 2018. The following table outlines the Share Appreciation Rights
granted or vested to the Directors of the Company and other KMP of the Group during the 2019 reporting period.
Rights
granted
during
the year
Grant date
Fair
value
per right
at grant
date
Value
of right
at grant
date ($)
Vesting
date
Exercise
price
Expiry
date
2019
Instru-
ment
Year
Executive Directors
R Heeks
SAR
2019
7,620,188
30-May-19
$0.009
68,582
19-Jul-22
$0.014
19-Jul-23
Other KMP
M Smith
G Zamudio
J Kerr
SAR
SAR
SAR
2019
5,616,000
12-Jul-19
$0.010
56,160
19-Jul-22
$0.016
19-Jul-23
2019
5,616,000
12-Jul-19
$0.010
56,160
19-Jul-22
$0.016
19-Jul-23
2019
4,823,460
12-Jul-19
$0.010
48,235
19-Jul-22
$0.016
19-Jul-23
Rights
vested/
lapsed
during
the
year
-
-
-
-
All 2019 Share Appreciation Rights were issued on 2 August 2019 prior to the 25:1 share consolidation that took
place in December 2019. All Share Appreciation Rights were adjusted at the time of the consolidation to reduce
the number of Share Appreciation Rights (reduced 25:1) and increase the exercise price (increased 25:1) where
relevant. The grant date differs for the directors to comply with the accounting standards.
Rights
granted
during
the year
Year
Grant date
Fair
value
per right
at grant
date
Value
of right
at grant
date ($)
Vesting
date
Exercise
price
Expiry
date
2018
4,838,214
30-May-18
$0.018
87,088
10-Jul-21
$0.0285
10-Jul-22
2018
3,565,714
30-May-18
$0.018
64,183
10-Jul-21
$0.0285
10-Jul-22
2018
3,565,714
3-Jul-18
$0.018
64,183
10-Jul-21
$0.0285
10-Jul-22
2018
3,565,714
3-Jul-18
$0.018
64,183
10-Jul-21
$0.0285
10-Jul-22
2018
3,565,714
3-Jul-18
$0.018
64,183
10-Jul-21
$0.0285
10-Jul-22
Instru-
2018
ment
Executive Directors
R Heeks
P Leggat
SAR
SAR
Other KMP
M Smith
G Zamudio
J Kerr
SAR
SAR
SAR
Rights
vested/
lapsed
during
the
year
-
-
-
-
-
The fair value of the Share Appreciation Rights is measured at grant date and allocated equally over the period from
grant date to vesting date, unless Directors of the Company and KMP of the Group resign during the vesting period
in which case the fair value of the Share Appreciation Rights is expensed immediately. This allocation is reflected in
the Share Based Payments column of the remuneration tables above.
The fair value at grant date was independently determined by a third party.
35
2019 ANNUAL REPORT
DIRECTORS’ REPORT
18 REMUNERATION REPORT – AUDITED (CONTINUED)
Equity Instrument Disclosures Relating to KMP
Options
Options over Ordinary Shares in the Company held during the financial year by Directors of the Company and other
KMP of the Group.
Opening
Balance
1 January 2019
Granted
During
the Year
Exercised
During
the Year
Net Change
Other(i)
Held at
Resignation(ii)
Closing
Balance
31 December
2019
Options
Exercisable at
31 December
2019(iii)
2019
Directors
M Jerkovic
M Bojanjac
I Clyne
C Gilligan
R Heeks
I Murray
-
-
750,000
-
-
-
-
-
-
-
(750,000)
-
-
-
-
-
10,593,263
17,387,846
(188,888)
(26,680,531)
-
-
-
-
Sub total
11,343,263
17,387,846
(938,888)
(26,680,531)
Other KMP
M Smith
10,427,777
16,255,625
(3,494,444)
(22,261,399)
G Zamudio
10,427,777
16,255,625
(3,494,444)
(22,261,399)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,111,690
1,111,690
-
-
1,111,690
1,111,690
927,559
927,559
-
927,559
927,559
-
J Kerr
10,427,777
11,822,025
(3,494,444)
-
(18,755,358)
Sub total
31,283,331
44,333,275
(10,483,332)
(44,522,798)
(18,755,358)
1,855,118
1,855,118
TOTAL
42,626,594
61,721,121
(11,422,220)
(71,203,329)
(18,755,358)
2,966,808
2,966,808
(i) Net Change Other includes the adjustments for the share consolidation on a 25:1 basis.
(ii) Held at Resignation does not factor in the 25:1 share consolidation as the consolidation occurred after the resignations.
(iii) Options exercisable at 31 December 2019 have not yet vested.
Opening
Balance
1 January 2018
Granted
During the
Year
Exercised
During the
Year
Net Change
Other
Held at
Resignation
Closing
Balance
31 December
2018
Options
Exercisable at
31 December
2018(i)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
750,000
-
10,593,263
10,427,777
21,771,040
10,427,777
10,427,777
10,427,777
31,283,331
53,054,371
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
750,000
750,000
-
-
10,593,263
10,593,263
(10,427,777)
-
-
(10,427,777)
11,343,263
11,343,263
-
-
-
-
10,427,777
10,427,777
10,427,777
10,427,777
10,427,777
10,427,777
31,283,331
31,283,331
(10,427,777)
42,626,594
42,626,594
2018
Directors
M Jerkovic
M Bojanjac
I Clyne
C Gilligan
R Heeks
P Leggat
Subtotal
Other KMP
M Smith
G Zamudio
J Kerr
Subtotal
TOTAL
36
2019 ANNUAL REPORT
DIRECTORS’ REPORT
18 REMUNERATION REPORT – AUDITED (CONTINUED)
Equity Instrument Disclosures Relating to KMP (Continued)
Share Appreciation Rights
Share Appreciation Rights over Ordinary Shares in the Company held during the financial year by Directors of the
Company and other KMP of the Group.
Opening
Balance
1 January
2019
Granted
During
the Year
Exercised
During
the Year
Net Change
Other(i)
Held at
Resignation(ii)
Closing
Balance
31 December
2019
Rights
Exercisable
at 31
December
2019(iii)
2019
Directors
M Jerkovic
M Bojanjac
I Clyne
C Gilligan
R Heeks
I Murray
Sub total
Other KMP
-
-
-
-
-
-
-
-
4,838,214
7,620,188
-
-
4,838,214
7,620,188
M Smith
3,565,714
5,616,000
G Zamudio
3,565,714
5,616,000
J Kerr
3,565,714
4,823,475
Sub total
10,697,142
16,055,475
TOTAL
15,535,356
23,675,663
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(11,960,065)
-
(11,960,065)
(8,814,445)
(8,814,445)
-
-
-
-
-
-
-
-
-
-
(8,389,189)
-
-
-
-
-
-
-
-
498,337
498,337
-
-
498,337
498,337
367,269
367,269
-
367,269
367,269
-
(17,628,890)
(8,389,189)
734,538
734,538
(29,588,955)
(8,389,189)
1,232,875
1,232,875
(i) Net Change Other includes the adjustments for the share consolidation on a 25:1 basis.
(ii) Held at Resignation does not factor in the 25:1 share consolidation as the consolidation occurred after the resignations.
(iii) Share Appreciation Rights exercisable at 31 December 2019 have not yet vested.
Opening
Balance
1 January
2018
Granted
During
the Year
Exercised
During
the Year
Net Change
Other
Held at
Resignation
Closing
Balance
31 December
2018
Rights
Exercisable
at 31
December
2018(i)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
4,838,214
3,565,714
8,403,928
3,565,714
3,565,714
3,565,714
10,697,142
19,101,070
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
4,838,214
4,838,214
(3,565,714)
-
-
(3,565,714)
4,838,214
4,838,214
-
-
-
-
3,565,714
3,565,714
3,565,714
3,565,714
3,565,714
3,565,714
10,697,142
10,697,142
(3,565,714)
15,535,356
15,535,356
2018
Directors
M Jerkovic
M Bojanjac
I Clyne
C Gilligan
R Heeks
P Leggat
Subtotal
Other KMP
M Smith
G Zamudio
J Kerr
Subtotal
TOTAL
(i) Share Appreciation Rights exercisable at 31 December 2018 have not yet vested.
37
2019 ANNUAL REPORT
DIRECTORS’ REPORT
18 REMUNERATION REPORT – AUDITED (CONTINUED)
Equity Instrument Disclosures Relating to KMP (Continued)
Ordinary Shares
The number of Ordinary Shares in the Company held during the financial year by each Director of the Company and
other KMP of the Group, including their personally related parties, was as follows:
Opening
Balance
1 January 2019
Issued on
Vesting of
Performance
Rights
Shares
Acquired on
Market(i)
Held at
Resignation(ii)
Net Change
Other(iii)
Closing
Balance
31 December
2019
13,196,677
3,416,666
2,400,000
-
-
-
-
(13,196,677)
(3,416,666)
-
-
-
-
750,000
3,650,000
-
-
-
8,768,618
188,888
2,288,278
-
-
-
-
-
-
-
(6,528,000)
272,000
-
-
(10,795,952)
449,832
-
-
27,781,961
938,888
5,938,278
(16,613,343)
(17,323,952)
721,832
-
1,000,000
-
3,494,444
3,494,444
3,494,444
1,000,000
10,483,332
-
-
-
-
-
-
(3,354,666)
(4,314,666)
(3,494,444)
-
139,778
179,778
-
(3,494,444)
(7,669,332)
319,556
28,781,961
11,422,220
5,938,278
(20,107,787)
(24,993,284)
1,041,388
2019
Directors
M Jerkovic
M Bojanjac
I Clyne
C Gilligan
R Heeks
I Murray
Subtotal
Other KMP
M Smith
G Zamudio
J Kerr
Subtotal
TOTAL
(i) Shares Acquired on Market includes shares acquired in the Placement.
(ii) Held at Resignation does not factor in the 25:1 share consolidation as the consolidation occurred after the resignations.
(iii) Net Change Other includes the adjustments for the share consolidation on a 25:1 basis.
Opening
Balance
1 January 2018
Issued on
Vesting of
Performance
Rights
Shares
Acquired on
Market
Held at
Resignation
Net Change
Other
Closing
Balance
31 December
2018
10,418,899
3,416,666
2,400,000
-
7,523,757
-
23,759,322
-
1,000,000
-
1,000,000
24,759,322
-
-
-
-
-
-
-
-
-
-
-
-
2,777,778
-
-
-
1,244,861
-
4,022,639
-
-
-
-
4,022,639
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
13,196,677
3,416,666
2,400,000
-
8,768,618
-
27,781,961
-
1,000,000
-
1,000,000
28,781,961
2018
Directors
M Jerkovic
M Bojanjac
I Clyne
C Gilligan
R Heeks
P Leggat
Subtotal
Other KMP
M Smith
G Zamudio
J Kerr
Subtotal
TOTAL
38
2019 ANNUAL REPORT
DIRECTORS’ REPORT
18 REMUNERATION REPORT – AUDITED (CONTINUED)
Transaction with directors, director related entities and other related parties
During the year ended 31 December 2019 the Group did not enter into any related party transactions with Directors
(2018: nil).
END OF REMUNERATION REPORT
The Directors Report, including the Remuneration Report, is signed in accordance with a resolution of the Directors:
Ian Clyne
Non-Executive Chairman
Perth, Australia
26 March 2020
39
2019 ANNUAL REPORT
AUDITOR’S INDEPENDENCE DECLARATION
Ernst & Young
11 Mounts Bay Road
Perth WA 6000 Australia
GPO Box M939 Perth WA 6843
Tel: +61 8 9429 2222
Fax: +61 8 9429 2436
ey.com/au
Ernst & Young
11 Mounts Bay Road
Auditor’s independence declaration to the directors of Geopacific
Perth WA 6000 Australia
GPO Box M939 Perth WA 6843
Resources Limited
Tel: +61 8 9429 2222
Fax: +61 8 9429 2436
ey.com/au
As lead auditor for the audit of the financial report of Geopacific Resources Limited for the financial year
ended 31 December 2019, I declare to the best of my knowledge and belief, there have been:
relation to the audit; and
a) no contraventions of the auditor independence requirements of the Corporations Act 2001 in
Auditor’s independence declaration to the directors of Geopacific
Resources Limited
b) no contraventions of any applicable code of professional conduct in relation to the audit.
As lead auditor for the audit of the financial report of Geopacific Resources Limited for the financial year
ended 31 December 2019, I declare to the best of my knowledge and belief, there have been:
This declaration is in respect of Geopacific Resources Limited and the entities it controlled during the
financial year.
a) no contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit; and
b) no contraventions of any applicable code of professional conduct in relation to the audit.
Ernst & Young
This declaration is in respect of Geopacific Resources Limited and the entities it controlled during the
financial year.
Pierre Dreyer
Partner
26 March 2020
Ernst & Young
Pierre Dreyer
Partner
26 March 2020
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
PD:JG:GEOPACIFIC:007
40
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
PD:JG:GEOPACIFIC:007
2019 ANNUAL REPORT
INDEPENDENT AUDITOR’S REPORT
Ernst & Young
11 Mounts Bay Road
Perth WA 6000 Australia
GPO Box M939 Perth WA 6843
Tel: +61 8 9429 2222
Fax: +61 8 9429 2436
ey.com/au
Independent auditor's report to the members of Geopacific Resources
Limited
Report on the audit of the financial report
Opinion
We have audited the financial report of Geopacific Resources Limited (the Company) and its subsidiaries
(collectively the Group), which comprises the consolidated statement of financial position as at 31
December 2019, the consolidated statement of profit or loss and other comprehensive income,
consolidated statement of changes in equity and consolidated statement of cash flows for the year then
ended, notes to the financial statements, including a summary of significant accounting policies, and the
directors' declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act
2001, including:
a)
b)
giving a true and fair view of the consolidated financial position of the Group as at 31 December
2019 and of its consolidated financial performance for the year ended on that date; 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 and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (the
Code) that are relevant to our audit of the financial report in Australia. We have also fulfilled our other
ethical responsibilities in accordance with the Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our opinion.
Material uncertainty related to going concern
We draw attention to Note 1 in the financial report, which describes the principal conditions that raise
doubt about the Group’s ability to continue as a going concern. These events or conditions indicate that a
material uncertainty exists that may cast significant doubt on the Group’s ability to continue as a going
concern. Our opinion is not modified in respect of this matter.
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
PD:JG:GEOPACIFIC:008
41
2019 ANNUAL REPORT
INDEPENDENT AUDITOR’S REPORT
Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our
audit of the financial report of the current year. These matters were addressed in the context of our audit
of the financial report as a whole, and in forming our opinion thereon, but we do not provide a separate
opinion on these matters. In addition to the matter described in the Material uncertainty related to going
concern section, we have determined the matter described below to be the key audit matte r to be
communicated in our report. For each matter below, our description of how our audit addressed the
matter is provided in that context.
We have fulfilled the responsibilities described in the Auditor’s Responsibilities for the Audit of the
Financial Report section of our report, including in relation to these matters. Accordingly, our audit
included the performance of procedures designed to respond to our assessment of the risks of material
misstatement of the financial report. The results of our audit procedures, including the procedures
performed to address the matters below, provide the basis for our audit opinion on the accompanying
financial report.
Carrying value of exploration and evaluation assets
Why significant
How our audit addressed the key audit matter
At 31 December 2019 the Group held capitalised
exploration and evaluation assets of $8.26
million.
The carrying value of capitalised exploration and
evaluation assets is assessed for impairment by
the Group when facts and circumstances indicate
that this capitalised expenditure may exceed its
recoverable amount.
The determination as to whether there are any
indicators to require capitalised exploration and
evaluation assets to be assessed for impairment,
involves a number of judgments including
whether the Group has tenure, will be able to
perform ongoing expenditure and whether there
is sufficient information for a decision to be
made that the area of interest is not
commercially viable. The directors did not
identify any impairment indicators as at 31
December 2019.
Refer to Note 14 in the financial report for
capitalised exploration and evaluation asset
balances and related disclosures.
In performing our procedures, we:
► Considered whether the Group’s right to explore
was current, which included obtaining and
assessing supporting documentation such as
license agreements and renewal applications
► Considered the Group’s intention to carry out
significant ongoing exploration and evaluation
activities in the relevant areas of interest which
included reviewing the Group’s Board approved
cash-flow forecast and enquiring of senior
management and the directors as to their
intentions and the strategy of the Group
► Assessed whether exploration and evaluation
data existed to indicate that the carrying value of
capitalised exploration and evaluation is unlikely
to be recovered through development or sale
► Assessed the adequacy of the disclosures in Note
14 of the financial report.
42
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
2019 ANNUAL REPORT
INDEPENDENT AUDITOR’S REPORT
Information other than the financial report and auditor’s report thereon
The directors are responsible for the other information. The other information comprises the information
included in the Company’s 2019 Annual Report, 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 accordingly we do not
express any form of assurance conclusion thereon, with the exception of the Remuneration Report and
our related assurance opinion.
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 t his regard.
Responsibilities of the directors for the financial report
The directors of the Company are responsible for the preparation of the financial report that gives a true
and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for
such internal control as the directors determine is necessary to enable the preparation of the financial
report that gives a true and fair view and is free from material misstatement, whether due to fraud or
error.
In preparing the financial report, the directors are responsible for assessing the Group’s ability to
continue as a going concern, disclosing, as applicable, matters relating to going concern and using the
going concern basis of accounting unless the directors either intend to liquidate the Group or to cease
operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes
our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit
conducted in accordance with the Australian Auditing Standards will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material if,
individually or in the aggregate, they could reasonably be expected to influence the economic decisions of
users taken on the basis of this financial report.
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional
judgment and maintain professional scepticism throughout the audit. We also:
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
43
2019 ANNUAL REPORT
INDEPENDENT AUDITOR’S REPORT
►
►
►
►
►
►
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 de tecting 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, includ ing 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 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, related safeguards.
From the matters communicated to the directors, we determine those matters that were of most
significance in the audit of the financial report of the current year 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.
44
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
2019 ANNUAL REPORT
INDEPENDENT AUDITOR’S REPORT
Report on the audit of the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 25 to 39 of the directors' report for the year
ended 31 December 2019 .
In our opinion, the Remuneration Report of Geopacific Resources Limited for the year ended 31
December 2019, complies with section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentat ion 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, base d on our audit conducted in accordance with Australian
Auditing Standards.
Ernst & Young
Pierre Dreyer
Partner
Perth
26 March 2020
45
2019 ANNUAL REPORT
DIRECTORS’ DECLARATIONGEOPACIFIC RESOURCES LIMITED
and Controlled Entities
DIRECTORS’ DECLARATION
In accordance with a resolution of the Directors of Geopacific Resources Limited, I declare that:
1.
In the opinion of the Directors:
(a) the financial statements and notes, of Geopacific Resources Limited for the financial year ended 31
December 2019 are in accordance with the Corporations Act 2001, including:
(i) giving a true and fair view of the consolidated entity’s financial position as at 31 December 2019
and of its performance for the year ended on that date; and
(ii) complying with Accounting Standards and Corporations Regulations 2001.
(b) the financial statements and notes also comply with International Financial Reporting Standards as
disclosed in Note 1.
(c) Subject to the matters disclosed in Note 1, there are reasonable grounds to believe that the Company
will be able to pay its debts as and when they become due and payable.
2. This declaration has been made after receiving the declarations required to be made to the Directors by
the Chief Executive Officer and Chief Financial Officer in accordance with section 295A of the
Corporations Act 2001 for the financial year ended 31 December 2019.
On behalf of the Board
Ian Clyne
Non-Executive Chairman
Perth, Australia
26 March 2020
46
52 | P a g e
2019 ANNUAL REPORT
GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
CONSOLIDATED STATEMENT OF PROFIT OR LOSS
AND OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2019
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2019
Finance income
Administration expenses
Consultancy expense
Depreciation expense
Employee benefits expense
Share based payments
Occupancy expenses
Finance costs
Impairment write downs
Exploration expense
Loss before income tax
Income tax benefit
Loss after tax from continuing operations
Loss after tax from discontinued operation (attributable to
equity holders of the company)
Loss for the year
Loss for the year attributable to:
Non-controlling interest
Owners of the parent
Other comprehensive income/(loss)
Items of other comprehensive income/(loss) to be
reclassified to profit or loss in subsequent periods (net of
tax)
Exchange differences on translating foreign controlled
entities
Other comprehensive (loss)/income for the year, net of
tax
Note
5
16
17
8
31
Consolidated
2019
$
2018
$
93,750
64,013
(364,164)
(743,127)
(199,355)
(1,672,205)
(1,374,119)
(58,253)
(1,443,017)
(75,473)
(1,501,751)
(7,337,714)
(275,809)
(1,162,501)
(36,121)
(1,572,695)
(709,371)
(170,167)
(1,123,578)
(44,230,355)
-
(49,216,584)
-
474,749
(7,337,714)
(48,741,835)
-
(7,337,714)
(5,008,824)
(53,750,659)
(61,349)
(7,276,365)
(80,466)
(53,670,193)
(7,337,714)
(53,750,659)
(195,365)
4,708,862
(195,365)
4,708,862
Total comprehensive loss for the year attributable to
members of the parent entity
(7,533,079)
(49,041,797)
53 | P a g e
47
2019 ANNUAL REPORT
CONSOLIDATED STATEMENT OF PROFIT OR LOSS
AND OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2019
GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2019
Consolidated
Note
2019
$
2018
$
Total comprehensive income/(loss) attributable to:
Non-controlling interest
Owners of the parent
Loss per share (cents) for loss from continuing operations
attributable to the ordinary equity holders of the company:
Basic loss per share
Diluted loss per share
Loss per share (cents) for loss attributable to the ordinary
equity holders of the company:
Basic loss per share
Diluted loss per share
27
27
27
27
(48,896)
(7,484,183)
(7,533,079)
27,245
(49,069,042)
(49,041,797)
(6.48)
(6.48)
(2.49)
(2.49)
(6.48)
(6.48)
(2.74)
(2.74)
The above consolidated statement of profit or loss and other comprehensive income should be read
in conjunction with the accompanying notes.
54 | P a g e
48
2019 ANNUAL REPORT
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2019
GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2019
Current Assets
Cash and cash equivalents
Receivables
Prepayments
Assets classified as held for sale
Inventory
Total Current Assets
Non-Current Assets
Exploration and evaluation assets
Mine properties under development
Property, plant and equipment
Total Non-Current Assets
TOTAL ASSETS
Current Liabilities
Trade and other payables
Lease liability
Provisions
Total Current Liabilities
Non-Current Liabilities
Trade and other payables
Provisions
Total Non-Current Liabilities
TOTAL LIABILITIES
NET ASSETS
Equity
Issued capital
Reserves
Accumulated losses
Total equity attributable to equity holders
Non-controlling interest
Total Equity
Consolidated
Note
2019
$
2018
$
9
10
11
12
13
14
15
16
17
18
17
18
19
20
37,505,067
687,717
1,027,731
-
339,592
39,560,107
3,059,221
316,617
-
149,388
242,771
3,767,997
8,262,803
30,803,497
1,892,285
40,958,585
37,494,025
-
841,611
38,335,636
80,518,692
42,103,633
6,991,223
82,111
65,590
7,138,924
3,236,829
-
135,569
3,372,398
2,694,195
207,198
2,901,393
3,852,972
192,548
4,045,520
10,040,317
7,417,918
70,478,375
34,685,715
148,972,741
4,843,542
(83,337,908)
70,478,375
-
70,478,375
104,116,108
5,790,853
(76,061,543)
33,845,418
840,297
34,685,715
The above consolidated statement of financial position should be read
in conjunction with the accompanying notes.
55 | P a g e
49
2019 ANNUAL REPORT
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2019
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C
50
2019 ANNUAL REPORT
GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2019
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDING 31 DECEMBER 2019
CASH FLOWS FROM OPERATING ACTIVITIES
Payments to suppliers and employees
Interest received
Interest paid
Net Cash Used In Operating Activities
CASH FLOWS FROM INVESTING ACTIVITIES
Payments for plant and equipment
Proceeds from the disposal of plant and equipment
Exploration expenditure
Mine development expenditure
Payment as part of the Kula transaction
Proceeds received from the Kula transaction
Cash held by subsidiary on its disposal
Net Cash Used In Investing Activities
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from share issues (net of costs)
Payment of principal portion of lease liability
Net Cash From Financing Activities
Consolidated
Note
2019
$
2018
$
(4,243,018)
32,519
(4,513)
(4,215,012)
(3,580,837)
64,013
-
(3,516,824)
30(b)
(1,119,562)
71,429
(697,980)
(1,077,051)
(745,382)
725,382
(67,745)
(2,910,909)
(246,401)
-
(9,626,184)
-
-
-
-
(9,872,585)
42,006,632
(104,182)
41,902,450
9,683,287
-
9,683,287
NET INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS
Cash and cash equivalents at beginning of the financial year
Effect of exchange rates on cash held in foreign currencies
CASH AND CASH EQUIVALENTS AT END OF THE FINANCIAL YEAR
34,776,529
3,059,221
(330,683)
37,505,067
(3,706,122)
6,765,343
-
3,059,221
The above consolidated statement of cash flows should be read
in conjunction with the accompanying notes.
57 | P a g e
51
2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Geopacific Resources Limited (“the Company” or “Geopacific”) is an Australian Securities Exchange listed
public company domiciled in Australia. The consolidated financial report of the Company for the financial
year ended 31 December 2019 comprises the Company and its controlled entities (together referred to as
the ‘Group’). The registered office is located at 278 Stirling Highway, Claremont, WA, 6010.
The Group is principally engaged in mineral development and exploration focussed on gold and copper
deposits in Papua New Guinea and Cambodia.
The financial report was authorised for issue by the directors on 26 March 2020.
Basis of preparation
The financial report is a general purpose financial report that has been prepared in accordance with
Australian Accounting Standards, other authoritative pronouncements of the Australian Accounting
Standards Board (AASB) and the Corporations Act 2001. The Group is a for-profit entity for financial reporting
purposes under Australian Accounting Standards.
Compliance with Australian Accounting Standards ensures that the financial statements and the notes
thereto also comply with International Financial Reporting Standards as issued by the International
Accounting Standards Board.
Material accounting policies adopted in the preparation of these financial statements are presented below
and have been consistently applied unless otherwise stated.
The financial report has been prepared on a historical cost basis.
Going Concern
The financial statements have been prepared on the going concern basis, which contemplates continuity of
normal business activities and the realisation of assets and settlement of liabilities in the ordinary course of
business.
During the year ended 31 December 2019, the Group incurred a net loss after tax of $7,337,714 (2018:
$53,750,659) and had cash outflows from operations of $4,215,012 (2018: $3,516,824).
In November 2018, the Group completed a Definitive Feasibility Study (DFS) on the Woodlark Gold Project
which indicated a thirteen year operating life and an estimated capital expenditure requirement of $198
million. The Woodlark Gold Project is at an advanced stage and has the key permits in place to develop the
mine and gold processing plant. The Group is currently completing the first phase of development of the
mine and is actively seeking to raise funding to complete the mine development and construction.
Whilst the Group had cash on hand of $37,505,067 (2018: $3,059,221) at 31 December 2019, its cash flow
forecast for the year ending 31 December 2020 reflects that the Group will require additional funding over
that period in order to meet the Group’s committed expenditure and complete the development and
construction of the mine and processing plant. As disclosed in Note 28, the current volatility in global equity
and commodity markets resulting from the uncertainty created by the impact of COVID-19, may impact the
Group’s ability to raise equity in future.
58 | P a g e
52
2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Going Concern (continued)
The Directors have considered the funding and operational status of the business in arriving at their
assessment of going concern and believe that the going concern basis of preparation is appropriate based
on:
(cid:31) Having adequate cash on hand at 31 December 2019 to meet the forecast cash outlay for completion of
the Civil Works Program, being the first phase of the Woodlark Gold Project development and other
committed costs for the year ending 31 December 2020;
(cid:31) The Group’s ability to raise funds from external sources to meet ongoing development, exploration and
working capital requirements, as demonstrated by the capital raisings of $44.4 million during the year
ended 31 December 2019;
(cid:31) The Group’s ability to manage the timing of cash flows to meet the obligations of the business as and
when they fall due;
(cid:31) Having the flexibility to amend business plans, should global and market conditions not be conducive to
raise the necessary funding required to fully fund the development of the Woodlark Gold Project, taking
into account the cash on hand (Note 9) and the commitments as disclosed in Note 22 at 31 December
2019, and to defer the Woodlark Gold Project development until market conditions improve; and
(cid:31) The Group’s ability to renegotiate the repayment terms of the deferred consideration liability (with a
present value of $7.7 million) owed for the purchase of the Kou Sa Project, as the Group has previously
renegotiated the repayment terms in September 2016 and is confident that it can do so again (see Note
17).
Notwithstanding the above, these conditions indicate the existence of a material uncertainty that may cast
significant doubt about the Group’s ability to continue as a going concern and, therefore, whether it will be
unable to realise its assets and discharge its liabilities in the normal course of business and at the amounts
stated in this financial report.
This financial report does not include any adjustments relating to the recoverability and classification of
recorded asset amounts, nor to the amounts or classification of liabilities that might be necessary should the
Group not be able to continue as a going concern.
59 | P a g e
53
2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
New and amended Accounting Standards and Interpretations adopted during the year
The Group has adopted all Accounting Standards and Interpretations effective from 1 January 2019, including:
AASB 16 Leases (AASB 16)
AASB 16 supersedes AASB 117 Leases (AASB 117) and IFRIC 4 Determining Whether an Arrangement Contains
a Lease (IFRIC 4). AASB 16 sets out the principles for the recognition, measurement, presentation and
disclosure of leases and requires lessees to account for most leases under a single on-balance sheet model.
The Group has applied, for the first time, AASB 16 from 1 January 2019, and has not restated comparatives
for the prior period as permitted under the specific transaction provisions in AASB 16. The nature and effect
of these changes are disclosed below.
The Group adopted AASB 16 using the modified retrospective method of adoption with the date of initial
application of 1 January 2019. Under this method, the standard is applied retrospectively with the cumulative
effect of initially applying the standard recognised at the date of initial application. The Group elected to use
the transition practical expedients allowing; a) the standard to be applied only to contracts that were
previously identified as leases applying AASB 117 and IFRIC 4 at the date of initial application; and b) the
measuring the right-of-use asset on transition as being equal to the amount of the lease liability initially
recognised on transition. The Group also elected to use the recognition exemptions for lease contracts that,
at the commencement date, have a lease term of 12 months or less and do not contain a purchase option
(‘short-term leases’), and lease contracts for which the underlying asset is of low value (‘low-value assets’).
The effect of adoption of AASB 16 is as follows:
The impact on the consolidated statement of financial position as at 1 January 2019 is an increase in property,
plant and equipment of $186,225 and an increase in the lease liability of $186,225.
Nature of the effect of adoption of AASB 16
The Group has a lease contract for its head office. Before the adoption of AASB 16, the Group classified this
lease (as lessee) at the inception date as an operating lease. In an operating lease, the leased property was
not capitalised and the lease payments were recognised as an expense in the consolidated statement of
profit or loss and other comprehensive income on a straight-line basis over the lease term.
Upon adoption of AASB 16, the Group applied a single recognition and measurement approach for all leases
of which it was the lessee, except for short-term leases and leases of low-value assets. The Group recognised
lease liabilities to make lease payments and right-of-use lease assets representing the right to use the
underlying assets. In accordance with the modified retrospective method of adoption of AASB 16, the Group
applied AASB 16 at the date of initial application by measuring the right-of-use assets based on the amount
equal to the lease liabilities. Lease liabilities were recognised based on the present value of the remaining
lease payments, discounted using the incremental borrowing rate at the date of initial application.
60 | P a g e
54
2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
New and amended Accounting Standards and Interpretations adopted during the year (continued)
Amounts recognised in the consolidated statement of financial position and comprehensive income
Set out below are the carrying amounts of the Company’s assets and lease liabilities and the movements
during the period:
Initial adoption of AASB 16 at 1 January 2019
Depreciation expense
Interest expense
Payments
As at 31 December 2019
Right-of-use
asset
$
Lease
liability
$
186,225
(101,577)
-
-
84,648
186,225
-
4,513
(108,627)
82,111
Set out below are the amounts recognised in the consolidated statement of profit or loss and other
comprehensive income for the year ending 31 December 2019:
Depreciation expense on right-of-use assets
Interest expense on lease liabilities
Rental expense – low value assets
Total amounts recognised in profit or loss
$
101,577
4,513
1,976
108,066
Set out below is a reconciliation of the operating lease commitments at 31 December 2018 to the lease
liability taken on at 1 January 2019:
Operating leases
Operating lease commitments as at 31 December 2018
Commitments relating to leases of low value assets
Variable outgoings relating to the leased premises included in 31 December 2018
commitment
Weighted average incremental borrowing rate as at 1 January 2019
Lease liability as at 1 January 2019
Lease
Liability
$
273,305
(4,941)
(62,864)
205,500
8%
186,225
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2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
New and amended Accounting Standards and Interpretations adopted during the year (continued)
AASB Interpretation 23 - Uncertainty over Income Tax Treatments
The Interpretation clarifies the application of the recognition and measurement criteria in AASB 112 Income
Taxes when there is uncertainty over income tax treatments. The Interpretation specifically addresses the
following:
(cid:31) Whether an entity considers uncertain tax treatments separately;
(cid:31) The assumptions an entity makes about the examination of tax treatments by taxation authorities;
(cid:31) How an entity determines taxable profit (tax loss), tax bases, unused tax losses, unused tax credits and
tax rates; and
(cid:31) How an entity considers changes in facts and circumstances.
The Directors have determined that there is no impact, material or otherwise, of this new interpretation on
its business.
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56
2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
New and Amended Accounting Standards and Interpretations issued but not yet effective
Australian Accounting Standards that have recently been issued or amended but are not yet effective and
have not been adopted by the Group for the annual reporting year ended 31 December 2019 are outlined
in the table below. The potential effect of these Standards on the Group is yet to be fully determined.
Application date
of
standard
1 January
2020
for
Group
1 January
2020
Reference
Title
Summary
AASB
2019-1
Conceptual
Framework
for Financial
Reporting
Amendments
to Australian
Accounting
Standards –
Reference to
the
Conceptual
Framework
The revised Conceptual Framework includes some
new concepts, provides updated definitions and
recognition criteria for assets and liabilities and
clarifies some important concepts. It is arranged in
eight chapters, as follows:
► Chapter 1 – The objective of financial reporting
► Chapter 2 – Qualitative characteristics of useful
financial information
► Chapter 3 – Financial statements and the reporting
entity
► Chapter 4 – The elements of financial statements
► Chapter 5 – Recognition and derecognition
► Chapter 6 – Measurement
► Chapter 7 – Presentation and disclosure
► Chapter 8 – Concepts of capital and capital
maintenance
AASB 2019-1 also sets out the amendments to other
pronouncements for references to the revised
the
Conceptual Framework. The changes
Conceptual Framework may affect the application of
accounting standards in situations where no standard
applies to a particular transaction or event. In
addition, relief has been provided in applying AASB 3
and developing accounting policies for regulatory
account balances using AASB 108, such that entities
must continue to apply the definitions of an asset and
a liability (and supporting concepts) in the Framework
for the Preparation and Presentation of Financial
Statements (July 2004), and not the definitions in the
revised Conceptual Framework.
to
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57
2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
New and Amended Accounting Standards and Interpretations issued but not yet effective (continued)
Reference
Title
Summary
The Standard amends the definition of a business in
AASB 3 Business Combinations. The amendments
clarify the minimum requirements for a business,
the assessment of whether market
remove
participants are capable of replacing missing
elements, add guidance to help entities assess
whether an acquired process is substantive, narrow
the definitions of a business and of outputs, and
introduce an optional fair value concentration test.
This Standard amends AASB 101 Presentation of
Financial Statements and AAS 108 Accounting
Policies, Changes in Accounting Estimates and Errors
to align the definition of ‘material’ across the
standards and to clarify certain aspects of the
definition. The amendments clarify that materiality
will depend on the nature or magnitude of
information. An entity will need to assess whether
the
in
combination with other information, is material in
the context of
financial statements. A
misstatement of information is material if it could
reasonably be expected to influence decisions made
by the primary users.
This Standard amends AASB 1054 by adding a
disclosure requirement for an entity intending to
comply with
IFRS Standards to disclose the
information specified in paragraphs 30 and 31 of
AASB 108 on the potential effect of an IFRS Standard
that has not yet been issued by the AASB so that
such entity complying with Australian Accounting
IFRS
Standards can assert compliance with
Standards.
information, either
individually or
the
Amendments
to Australian
Accounting
Standards –
Definition of a
Business
Amendments
to Australian
Accounting
Standards –
Definition of
Material
Amendments
to Australian
Accounting
Standards –
Disclosure of
the Effect of
New IFRS
Standards Not
Yet Issued in
Australia
AASB
2018-6
AASB
2018-7
AASB
2019-5
58
Application date
of
standard
1 January
2020
for
Group
1 January
2020
1 January
2020
1 January
2020
1 January
2020
1 January
2020
64 | P a g e
2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Significant accounting policies
The following is a summary of the material accounting policies adopted by the Group in the preparation of
the financial report. The accounting policies have been consistently applied, unless otherwise stated.
(a) Cash and cash equivalents
Cash and short-term deposits in the consolidated statement of financial position comprise cash at bank
and on hand. Cash equivalents are short-term, highly liquid investments that are readily convertible to
known amounts of cash and which are subject to an insignificant risk of changes in value.
For the purposes of the consolidated statement of cash flows, cash and cash equivalents consist of cash
and cash equivalents as defined above.
(b) Share Capital
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares
or options are shown in equity as a deduction from the proceeds.
(c) Employee benefits
Wages, salaries and annual leave
Liabilities for wages and salaries, including non-monetary benefits, and annual leave expected to be
wholly settled within 12-months of the reporting date are recognised in provisions in respect of
employees’ services up to the reporting date. The liabilities are measured at the amounts expected to be
paid when they are settled. All other amounts are considered other long term benefits for measurement
purposes and are measured at the present value of expected future payments to be made in respect to
services provided by employees.
Long service leave
The liability for long service leave is recognised in the provision for employee benefits and measured as
the present value of expected future payments to be made, in respect of services provided by employees
up to the reporting date using the projected unit credit method. Consideration is given to expected
future salary levels, experience of employee departures and periods of service. Expected future
payments are discounted using market yields at the reporting date on high quality corporate bonds with
terms to maturity and currency that match, as closely as possible, the estimated future cash outflows.
Superannuation
The Group makes contributions on behalf of its employees to complying superannuation funds in
accordance with the rates outlined by the statutory regulations.
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2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(c) Employee benefits (continued)
Share-based payments
The fair value of options and rights granted to Directors and employees is recognised as a share based
payments expense with a corresponding increase in equity. The fair value is measured at grant date and
recognised over the period during which the employees become unconditionally entitled to the options
or rights.
The fair value at grant date is determined by a combination of internal and external sources using a Black-
Scholes option pricing model and independent third party valuations that take into account the exercise
price, the term of the right or option, the impact of dilution, the share price at grant date and expected
price volatility of the underlying share, the expected dividend yield and the risk-free interest rate for the
term of the right or option.
The fair value of the options and rights granted is adjusted to reflect market vesting conditions, but
excludes the impact of any non-market vesting conditions (for example, profitability and sales growth
targets). Non-market vesting conditions are included in assumptions about the number of options and
rights that are expected to become exercisable. At each year end, the Company revises its estimate of
the number of options that are expected to become exercisable. The employee benefit expense
recognised each period takes into account the most recent estimate.
Upon the exercise of options or rights, the balance of the share-based payments reserve relating to those
options is transferred to a vested share-based payments reserve and the proceeds received, net of any
directly attributable transaction costs, are credited to share capital.
(d) Financial Instruments
A financial instrument is any contract that gives rise to a financial asset of one entity and a financial
liability or equity instrument of another entity.
Financial assets
Initial recognition and measurement
Financial assets are classified, at initial recognition, and subsequently measured at amortised cost, fair
value through other comprehensive income (OCI), or fair value through profit or loss (FVTPL).
The classification of financial assets at initial recognition that are debt instruments depends on the
financial asset’s contractual cash flow characteristics and the Group’s business model for managing them.
With the exception of trade receivables that do not contain a significant financing component or for
which the Group has applied the practical expedient, the Group initially measures a financial asset at its
fair value plus, in the case of a financial asset not at fair value through profit or loss, transaction costs.
Trade receivables that do not contain a significant financing component or for which the Group has
applied the practical expedient for contracts that have a maturity of one year or less, are measured at
the transaction price determined under AASB 15.
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2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(d) Financial Instruments (continued)
Initial recognition and measurement (continued)
In order for a financial asset to be classified and measured at amortised cost or fair value through OCI, it
needs to give rise to cash flows that are ‘solely payments of principal and interest (SPPI)’ on the principal
amount outstanding. This assessment is referred to as the SPPI test and is performed at an instrument
level and have a business model of holding the financial asset and collecting contractual cash flows.
The 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 flows, selling the financial assets, or both.
Subsequent measurement
For purposes of subsequent measurement, financial assets are classified in four categories:
(cid:31)
(cid:31)
Financial assets at amortised cost (debt instruments);
Financial assets at fair value through OCI with recycling of cumulative gains and losses (debt
instruments);
Financial assets designated at fair value through OCI with no recycling of cumulative gains and losses
upon derecognition (equity instruments); and
Financial assets at fair value through profit or loss.
(cid:31)
(cid:31)
Financial assets at amortised cost (debt instruments)
The Group measures financial assets at amortised cost if both of the following conditions are met:
(cid:31)
The financial asset is held within a business model with the objective to hold financial assets in order
to collect contractual cash flows; and
The contractual terms of the financial asset give rise on specified dates to cash flows that are solely
payments of principal and interest on the principal amount outstanding.
(cid:31)
Financial assets at amortised cost are subsequently measured using the effective interest rate (EIR)
method and are subject to impairment. Interest received is recognised as part of finance income in the
statement of profit or loss and other comprehensive income. Gains and losses are recognised in profit or
loss when the asset is derecognised, modified or impaired.
Financial assets at fair value through profit or loss
Financial assets that do not meet the criteria for amortised cost are measured at fair value through profit
and loss.
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2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(d) Financial Instruments (continued)
Impairment of financial assets
The Group recognises an allowance for expected credit losses (ECLs) for all debt instruments not held at
fair value through profit or loss. ECLs are based on the difference between the contractual cash flows
due in accordance with the contract and all the cash flows that the Group expects to receive, discounted
at an approximation of the original EIR. ECLs are recognised in two stages. For credit exposures 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 (a 12-month ECL). For
those credit exposures for which there has been a significant increase in credit risk since initial
recognition, a loss allowance is required for credit losses expected over the remaining life of the
exposure, irrespective of the timing of the default (a lifetime ECL).
For trade receivables and contract assets, the Group applies a simplified approach in calculating ECLs. In
this regard, the Group recognises a loss allowance based on the financial asset’s lifetime ECL at each
reporting date. The Group has assessed the risk from a provision matrix that is based on the Group’s
historic credit loss experience, adjusted for factors that are specific to the debtor, general economic
conditions and an assessment of both the current as well as forecast conditions at the reporting date.
For all other financial assets measured at amortised cost, the Group recognises lifetime ECLs when there
has been a significant increase in credit risk since initial recognition. If the credit risk on the financial
instrument has not increased significantly since initial recognition, the Group measures the loss
allowance for that financial instrument at an amount equal to a 12-month ECL. The determination of the
ECL includes both quantitative and qualitative information and analysis, based on the Group’s historical
experience and forward-looking information.
The Group considers an event of default has occurred when a financial asset is more than 90 days past
due or external sources indicate that the debtor is unlikely to pay its creditors, including the Group. A
financial asset is credit impaired when there is evidence that the counterparty is in significant financial
difficulty or a breach of contract, such as a default or past due event has occurred. The Group writes off
a financial asset when there is information indicating the counterparty is in severe financial difficulty and
there is no realistic prospect of recovery.
Financial liabilities
Initial recognition and measurement
Non-derivative financial liabilities (excluding financial guarantees) are subsequently measured at
amortised cost using the effective interest method.
The conversion option classified as equity is determined by deducting the amount of the liability
component from the fair value of the compound instrument as a whole. This is recognised and included
in equity, net of income tax effects, and is not subsequently remeasured. In addition, the conversion
option classified as equity will remain in equity until the conversion option is exercised, in which case,
the balance recognised in equity will be transferred to issued capital. Where the conversion option
remains unexercised at the maturity date of the convertible note, the balance recognised in equity will
be transferred to accumulated losses within equity.
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2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(d) Financial Instruments (continued)
Initial recognition and measurement (continued)
No gain or loss is recognised in profit or loss upon conversion or expiration of the conversion option.
Transaction costs that relate to the issue of the convertible notes are allocated to the liability and equity
components in proportion to the allocation of the gross proceeds. Transaction costs relating to the equity
component are recognised directly in equity. Transaction costs relating to the liability component are
included in the carrying amount of the liability component and are amortised over the lives of the
convertible notes using the effective interest method.
(e) Foreign currency transactions and balances
Functional and presentation currency
Items included in the financial statements of each of the Group’s entities are measured using the
currency of the primary economic environment in which the entity operates (‘the functional currency’).
The consolidated financial statements are presented in Australian dollars, which is Geopacific Resources
Limited’s functional and presentation currency.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates
prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the
settlement of such transactions and from the translation at year-end exchange rates of monetary assets
and liabilities denominated in foreign currencies are recognised in the consolidated statement of profit
or loss and other comprehensive income.
Group companies
The financial results and position of foreign operations, whose functional currency is different from the
Group’s presentation currency, are translated as follows:
(cid:31) assets and liabilities are translated at year-end exchange rates prevailing at reporting date; and
(cid:31)
income and expenses are translated at average exchange rates for the period.
Exchange differences arising on translation of foreign operations are transferred directly to the Group’s
foreign currency translation reserve in the statement of changes in equity. These differences are
recognised in the consolidated statement of profit or loss and other comprehensive income in the period
in which the operation is disposed.
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2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(f) Goods and Services Tax (GST) and Value Added Tax (VAT)
Revenues, expenses and assets are recognised net of the amount of associated GST or VAT, unless the
GST or VAT incurred is not recoverable from the taxation authority. In this case, the GST or VAT is
recognised as part of the cost of acquisition of the asset or as part of the expense.
Receivables and payables are stated inclusive of the amount of GST or VAT receivable or payable. The
net amount of GST or VAT recoverable from, or payable to, the taxation authority is included with other
receivables or payables in the consolidated statement of financial position.
Cash flows are presented on a gross basis. The GST or VAT components of cash flows arising from
investing or financing activities which are recoverable from, or payable to the taxation authority, are
presented as operating cash flows.
(g) Impairment of non-financial assets
Non-financial assets are reviewed for impairment whenever events or changes in circumstances indicate
that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by
which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher
of an asset’s fair value less costs of disposal and value in use. For the purposes of assessing impairment,
assets are grouped at the lowest levels for which there are separately identifiable cash inflows which are
largely independent of the cash inflows from other assets or groups of assets (cash-generating units).
Non-financial assets other than goodwill that suffered an impairment are reviewed for possible reversal
of the impairment at each reporting date.
(h) Interests in joint arrangements
Joint arrangements represent the contractual sharing of control between parties in a business venture
where unanimous decisions about relevant activities are required. Separate joint venture entities
providing joint venturers with an interest in net assets are classified as a joint venture and accounted for
using the equity method.
Joint venture operations represent arrangements whereby joint operators maintain direct interests in
each asset and exposure to each liability of the arrangement. The Group’s interests in the assets,
liabilities, revenue and expenses of joint operations are included in the respective line items of the
consolidated financial statements.
Gains and losses resulting from sales to a joint operation are recognised to the extent of the other parties’
interests. When the Group makes purchases from a joint operation, it does not recognise its share of the
gains and losses from the joint arrangement until it resells those goods/assets to a third party.
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2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(i) Income tax
The income tax expense or revenue for the year is the tax payable on the current year’s taxable income
based on the national income tax rate adjusted by changes in deferred tax assets and liabilities
attributable to temporary differences between the tax bases of assets and liabilities and their carrying
amounts in the financial statements, and to unused tax losses.
Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected to
apply when the assets are recovered or liabilities are settled, based on the laws that have been enacted
or substantively enacted by the reporting date. The relevant tax rates are applied to the cumulative
amounts of deductible and taxable temporary differences to measure the deferred tax asset or liability.
An exception is made for certain temporary differences arising from the initial recognition of an asset or
a liability. Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset
current tax assets and liabilities, and they relate to income taxes levied by the same tax authority on the
same taxable entity, or on different tax entities, but they intend to settle current tax liabilities and assets
on a net basis or their tax assets and liabilities will be realised simultaneously.
No deferred tax asset or liability is recognised in relation to temporary differences if they arose in a
transaction, other than a business combination, that at the time of the transaction did not affect either
accounting profit or taxable profit or loss.
Deferred tax liabilities and assets are not recognised for temporary differences between the carrying
amount and tax bases of investments in controlled entities where the Company is able to control the
timing of the reversal of the temporary differences and it is probable that the differences will not reverse
in the foreseeable future.
A deferred tax asset is recognised for unused tax losses, tax credits and deductible temporary differences
to the extent that it is probable that future taxable profits will be available against which they can be
utilised. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is
no longer probable that the related tax benefit will be realised.
Current and deferred tax balances attributable to amounts recognised directly in equity are also
recognised directly in equity.
(j) Loss per share
Basic loss per share
Basic loss per share is calculated by dividing the result attributable to equity holders of the Company,
excluding any costs of servicing equity other than ordinary shares, by the weighted average number of
ordinary shares outstanding during the financial year, adjusted for bonus elements in ordinary shares
issued during the year.
Diluted loss per share
Diluted loss per share adjusts the figures used in the determination of basic loss per share to take into
account the after tax effect of interest and other financing costs associated with dilutive potential
ordinary shares and the weighted average number of shares assumed to have been issued for no
consideration in relation to dilutive potential ordinary shares.
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65
2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(k) Mineral Tenements and Deferred Mineral Exploration Expenditure
Exploration and evaluation expenditure is carried forward as an asset when rights to tenure are current;
and:
(cid:31)
such costs are expected to be recouped through the successful development and exploitation of the
area of interest, or by its sale; or
(cid:31) exploration activities in the area of interest have not reached a stage which permits a reasonable
assessment of the existence or otherwise of economically recoverable reserves and active or
significant operations in, or in relation to, the area of interest are continuing.
In the event that an area of interest is abandoned or if the Directors consider the expenditure to be of
reduced value, accumulated costs carried forward are written off or impaired in the year in which that
assessment is made. A regular review is undertaken of each area of interest to determine the
appropriateness of continuing to carry forward costs in relation to that area of interest.
Immediate restoration, rehabilitation and environmental costs necessitated by exploration and
evaluation activities are treated as exploration and evaluation expenditure. Exploration activities
resulting in future obligations in respect of restoration costs result in a provision to be made by
capitalising the estimated costs, on a discounted basis, of restoration. The unwinding of the effect of the
discounting on the provision is recorded as a finance cost in the statement of profit or loss and other
comprehensive income.
When a decision is made to proceed with development in a particular area of interest, the relevant
exploration and evaluation asset is tested for impairment and the balance is then transferred to mine
properties under development.
(l) Mine properties under development
Once technical feasibility and commercial viability of extraction of mineral resources in a particular area
of interest becomes demonstrable, the exploration and evaluation assets attributable to that area of
interest are reclassified as mine properties under development.
Mine properties under development represents the direct and indirect costs incurred in preparing mines
for production and includes site upgrades, clearing, stripping and waste removal costs incurred before
production commences. These costs also include borrowing costs incurred during the development
stage. These costs are capitalised to the extent that they are expected to be recouped through the
successful exploitation of the related mining leases. Once production commences, these costs will be
amortised using the units of production method based on the estimated economically recoverable
reserves to which they relate or are written off if the mine property is abandoned.
Mine properties under development are assessed for impairment if an impairment trigger is identified.
For the purposes of impairment testing capitalised mine properties are allocated to the cash generating
unit (CGU) to which the properties relate.
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66
2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(m) Plant and equipment
Plant and equipment is stated at historical cost less accumulated depreciation and any accumulated
impairment losses. Historical cost includes expenditure that is directly attributable to the acquisition of
the items.
Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as
appropriate, only when it is probable that future economic benefits associated with the item will flow to
the Group and the cost of the item can be measured reliably. All other repairs and maintenance are
charged to the consolidated statement of profit or loss and other comprehensive income during the
financial year in which they are incurred.
Depreciation on assets is calculated using the straight-line or diminishing value method to allocate their
cost, net of their residual values, over their estimated useful lives, as follows:
(cid:31) Plant and equipment
(cid:31) Computer software
(cid:31) Furniture and fittings
5% - 50%
25% - 100%
4% - 15%
The assets’ residual values, useful lives and depreciation methods are reviewed, and adjusted
prospectively if appropriate, at each reporting date.
An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying
amount is greater than its estimated recoverable amount.
An item of plant and equipment is derecognised upon disposal or when no further future economic
benefits are expected to arise from the continued use of the asset.
Any gains or loss on the derecognition of an asset (calculated as the difference between the net disposal
proceeds and the carrying amount of the asset) are included in the consolidated statement of profit or
loss and other comprehensive income in the period the item is derecognised.
(n) Inventory
Inventories expected to be used in production are valued at the lower of cost and net realisable value.
Cost is determined on a first-in-first out (FIFO) basis. Any provision for obsolescence or damage is
determined by reference to specific stock items identified. The carrying value of those items identified,
if any, is written down to net realisable value.
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67
2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(o) Principles of consolidation
The consolidated financial statements comprise the financial statements of Geopacific Resources Limited
and its controlled entities, referred to collectively throughout these financial statements as the “Group”.
Controlled entities are consolidated from the date on which control commences until the date that
control ceases.
Control is achieved when the Group is exposed, or has rights, to variable returns from its involvement
with the investee and has the ability to affect those returns through its power over the investee.
Specifically, the Group controls an investee if, and only if, the Group has:
(cid:31) Power over the investee (i.e. existing rights that give it the current ability to direct the relevant
activities of the investee);
(cid:31) Exposure, or rights, to variable returns from its involvement with the investee; and
(cid:31) The ability to use its power over the investee to affect its returns.
Generally, there is a presumption that a majority of voting rights results in control. To support this
presumption and when the Group has less than a majority of the voting or similar rights of an investee,
the Group considers all relevant facts and circumstances in assessing whether it has power over an
investee, including:
(cid:31) The contractual arrangement(s) with the other vote holders of the investee;
(cid:31) Rights arising from other contractual arrangements; and
(cid:31) The Group’s voting rights and potential voting rights.
The Group reassesses whether or not it controls an investee if facts and circumstances indicate that there
are changes to one or more of the three elements of control. Consolidation of a subsidiary begins when
the Group obtains control over the subsidiary and ceases when the Group loses control of the subsidiary.
Assets, liabilities, income and expenses of a subsidiary acquired or disposed of during the year are
included in the consolidated financial statements from the date the Group gains control until the date
the Group ceases to control the subsidiary.
The financial statements of the controlled entities are prepared for the same reporting period as the
parent company using consistent accounting policies. Adjustments are made to bring into line any
dissimilar accounting policies that may exist.
The balances and effects of transactions between controlled entities included in the consolidated
financial statements have been fully eliminated.
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68
2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(o) Principles of consolidation (continued)
Non-controlling interest
Non-controlling interests are allocated their share of net profit or loss after tax in the consolidated
statement of profit or loss and other comprehensive income and are presented within equity in the
consolidated statement of financial position, separately from the equity of the owners of the parent.
Losses are attributed to the non-controlling interests even if that results in a deficit balance. When
necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting
policies in line with the Group’s accounting policies. All intra-group assets and liabilities, equity, income,
expenses and cash flows relating to transactions between members of the Group are eliminated in full
on consolidation. A change in the ownership interest of a subsidiary, without a loss of control, is
accounted for as an equity transaction.
(p) Assets held for sale
Assets and disposal groups are classified as ‘held for sale’ if their carrying amount is to be recovered
principally through a sales transaction rather than through continuing use. The reclassification takes
place when the assets are available for immediate sale and the sale is highly probably. Non-current assets
held for sale are measured at the lower of carrying amount and fair value less costs of disposal. Assets
held for sale are not depreciated or amortised.
(q) Lease liability (new policy applied from 1 January 2019 due to adoption of AASB 16)
At the commencement date of the lease, the Group recognises lease liabilities measured at the present
value of lease payments to be made over the lease term. The lease payments include fixed payments
(including in-substance fixed payments) less any lease incentives receivable, variable lease payments that
depend on an index or a rate and amounts expected to be paid under residual value guarantees. The
variable lease payments that do not depend on an index or a rate are recognised as expense in the period
on which the event or condition that triggers the payment occurs.
In calculating the present value of lease payments, the Group uses the incremental borrowing rate at the
lease commencement date if the interest rate implicit in the lease is not readily determinable. After the
commencement date, the amount of lease liabilities is increased to reflect the accretion of interest and
reduced for the lease payments made. In addition, the carrying amount of lease liabilities is remeasured
if there is a modification, a change in the lease term or a change in the in-substance fixed lease payments.
Short-term lease and leases of low-value assets
The Group applies the short-term and lease of low-value assets recognition exemptions to leases that
are considered short-term or of low value (i.e. those leases that have a lease term of less than 12 months
or where the value of the leased asset when new is below $10,000). Lease payments on short-term leases
and leases of low-value assets are expensed over the lease term.
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69
2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(q) Lease liability (new policy applied from 1 January 2019 due to adoption of AASB 16) (continued)
Right-of-use asset
The Group recognises right-of-use assets at the commencement date of the lease (i.e. the date the
underlying asset is available for use). Right-of-use assets are measured at cost, less any accumulated
depreciation and impairment losses, and adjusted for any remeasurement of lease liabilities. The cost of
right-of-use assets includes the amount of lease liabilities recognised, initial direct costs incurred and
lease payments made at or before the commencement date less any lease incentives received. Unless
the Group is reasonably certain to obtain ownership of the leased asset at the end of the lease term, the
recognised assets are depreciated on a straight-line basis over the shorter of its estimated useful life and
lease term. Right-of-use assets are assessed for impairment.
(r) Leases (policy applied pre 1 January 2019)
Leases in which a significant portion of the risks and rewards of ownership were retained by the lessor
were classified as operating leases. Payments made under operating leases (net of any incentives
received from the lessor) were charged to the statement of profit or loss and other comprehensive
income on a straight-line basis over the period of the lease.
(s) Interest income
Interest income is recognised as the interest accrues using the effective interest method.
(t) Comparative figures
When required by Accounting Standards or in order to enhance comparability, comparative figures have
been adjusted to conform to changes in presentation for the current financial year.
(u) Provisions
Provisions are recognised when the Group has legal or constructive obligation, as a result of past events,
for which it is probable that an outflow of economic benefits will result and that outflow can be reliably
measured.
Provisions are measured using the best estimate of the amounts required to settle the obligation at the
end of the reporting period.
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70
2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(v) Business combinations
The acquisition method of accounting is used to account for all business combinations regardless of
whether equity instruments or other assets are acquired. The consideration transferred for the
acquisition of a subsidiary comprises the fair values of the assets transferred, the liabilities incurred and
the equity interests issued by the Group. The consideration transferred also includes the fair value of any
asset or liability resulting from a contingent consideration arrangement and the fair value of any pre-
existing equity interest in the subsidiary. Acquisition related costs are expensed as incurred. Identifiable
assets acquired and liabilities and contingent liabilities assumed in a business combination are, with
limited exceptions, measured initially at their fair values at the acquisition date. On an acquisition by
acquisition basis, the Group recognises any non-controlling interest in the acquiree either at fair value or
at the non-controlling interest's proportionate share of the acquiree’s net identifiable assets.
The excess of the consideration transferred, the amount of any non-controlling interest in the acquiree
over the fair value of the net identifiable assets acquired is recorded as goodwill. If those amounts are
less than the fair value of the net identifiable assets of the subsidiary acquired and the measurement of
all amounts has been reviewed, the difference is recognised directly in profit or loss as a bargain
purchase.
Where settlement of any part of cash consideration is deferred, the amounts payable in the future are
discounted to their present value as at the date of exchange. The discount rate used is the entity's
incremental borrowing rate, being the rate at which a similar borrowing could be obtained from an
independent financier under comparable terms and conditions.
Contingent consideration is classified either as equity or a financial liability. Amounts classified as a
financial liability are subsequently remeasured to fair value with changes in fair value recognised in
statement of profit or loss and other comprehensive income.
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71
2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
2
FINANCIAL RISK MANAGEMENT
The Group has exposure to a variety of risks arising from its use of financial instruments. This note presents
information about the Group’s exposure to the specific risks, and the policies and processes for measuring
and managing those risks. Further quantitative disclosures are included throughout this financial report. The
Board of Directors have the overall responsibility for the risk management framework.
(a) Credit risk
Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument
fails to meet its contractual obligations, and arises principally from transactions with customers and
investments.
The carrying amount of financial assets included in the consolidated statement of financial position
represents the Group’s maximum exposure to credit risk in relation to those assets. The Group does not
hold any credit derivatives to offset its credit exposure.
The Group trades only with recognised, credit worthy third parties and as such collateral is not requested
nor is it the Group’s policy to securitise its trade and other receivables. Receivable balances are
monitored on an ongoing basis with the result that the Group does not have a significant exposure to
bad debts. The Group has the following concentrations of credit risk:
Receivables
The Group has no listed investments and the current nature of the business activity does not result in
trading receivables. The receivables that the Group recognises through the normal course of business
are short term in nature. The risk of non-recovery of receivables from this source is considered to be
negligible.
Cash deposits
The Group’s primary banker is the ANZ Banking Group. The Group currently has no significant
concentrations of credit risk. The Moody’s credit rating of ANZ Banking Group is A1.
(b) Liquidity risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due.
The Group’s approach to managing liquidity is to ensure, as far as possible, that it has sufficient liquidity
to meet its liabilities when due, under both normal and stressed conditions, without incurring
unacceptable losses or risking damage to the Group’s reputation.
The Group manages its liquidity risk by monitoring its cash reserves and forecast spending. Management
is cognisant of the future demands for resources to finance the Group’s current and future operations,
and consideration is given to the liquid assets available to the Group before commitment is made for
future expenditure or investment.
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72
2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
GEOPACIFIC RESOURCES LIMITED
and Controlled En(cid:31)(cid:31)es
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
2
FINANCIAL RISK MANAGEMENT (CONTINUED)
(b) Liquidity risk (con(cid:31)nued)
The following table reflects the liquidity risk arising from the financial liabili(cid:2)es held by the Group at
balance date. The contractual maturity reflects undiscounted gross amounts:
Consolidated
2019
Carrying
amount
$
Contractual
cash flows
$
6 months
or less
$
6-12
months
$
1-5 years
$
Financial Liabili(cid:31)es - Due for Payment
Trade and other payables
Lease liability
Total expected ou(cid:30)lows
9,685,418
82,111
9,767,529
10,911,920
92,142
11,004,062
5,871,024
55,285
5,926,309
1,120,199
36,857
1,157,056
3,920,697
-
3,920,697
Consolidated
2018
Carrying
amount
$
Contractual
cash flows
$
6 months
or less
$
6-12
months
$
1-5 years
$
Financial Liabili(cid:31)es - Due for Payment
Trade and other payables
Total expected ou(cid:30)lows
7,089,801
7,089,801
9,784,848
9,784,848
844,874
844,874
2,793,742
2,793,742
6,146,232
6,146,232
At 31 December 2019, the Group had no interest-bearing liabili(cid:143)es (2018: nil).
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2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
2
FINANCIAL RISK MANAGEMENT (CONTINUED)
(c) Market risk
Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and
equity prices will affect the Group’s income or the value of its holdings of financial instruments. The
objective of market risk management is to manage and control market risk exposures within acceptable
parameters, while optimising any return.
Foreign exchange risk
The Group operates in Australia, Papua New Guinea, Cambodia and Fiji and is exposed to foreign
exchange risks arising from the fluctuation of the exchange rates of the Australian dollar, United States
dollar, the Fijian dollar and the Papua New Guinea Kina. The Group has no further material foreign
currency dealings other than the above.
Foreign exchange risk arises when future commercial transactions and recognised assets and liabilities
are denominated in a currency that is not the functional currency of the Group entity in question. The
Group does not have a formal foreign currency risk management policy however, it monitors its foreign
currency expenditure in light of exchange rate movements.
Foreign currency sensitivity
The following table demonstrate the sensitivity to a reasonably possible change in USD and AUD
exchange rates, with all other variables held constant. The impact on the Group’s pre-tax equity is due to
changes in the fair value of monetary assets and liabilities. The Group’s exposure to foreign currency
changes for all other currencies is not material.
Profit and Loss
Equity
500bp
increase
$
500bp
decrease
$
500bp
increase
$
500bp
decrease
$
-
-
-
-
-
-
-
-
(1,199,347)
(1,350,256)
1,199,347
1,350,256
2,567,183
2,007,514
(2,567,183)
(2,007,514)
2019 - AUD foreign currency sensitivity
2018 - AUD foreign currency sensitivity
2019 - USD foreign currency sensitivity
2018 - USD foreign currency sensitivity
Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate
because of changes in market interest rates. The Group’s exposure to the risk of changes in market
interest rates relates primarily to the Group’s cash and cash equivalents.
The Group’s income and operating cash flows are not materially exposed to changes in market interest
rates. The assets are cash and cash equivalents and other short term interest bearing deposits. No
financial instruments have been used to mitigate risk.
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2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
2
FINANCIAL RISK MANAGEMENT (CONTINUED)
(c) Market risk (continued)
Interest rate risk (continued)
The interest profile of the Group’s interest-bearing financial instruments at the reporting date are
outlined in the table below:
Variable rate instruments:
Cash and cash equivalents
Total
Consolidated
2019
$
2018
$
37,505,067
37,505,067
3,059,221
3,059,221
A change of 100 basis points in interest rates at the reporting date would have increased/(decreased)
equity and comprehensive income by the amounts shown below. The analysis assumes that all other
variables remain constant.
Profit and Loss
Equity
100bp
increase
$
100bp
decrease
$
100bp
increase
$
100bp
decrease
$
2019 - Variable rate instruments
2018 - Variable rate instruments
375,051
30,592
(375,051)
(30,592)
375,051
30,592
(375,051)
(30,592)
(d) Capital management
The Board’s policy is to maintain a sound capital base, defined as equity, so as to maintain investor,
creditor and market confidence and to sustain future development of the business. The Board of
Directors monitors capital expenditure and cash flows as mentioned in (b) above.
The objective when managing capital is to safeguard the Group’s ability to continue as a going concern,
so as to maintain a strong capital base sufficient to continue the development and exploration of its
projects. In order to maintain or adjust the capital structure, the Group may return capital to
shareholders, issue new shares or sell assets. The Group’s focus has been to raise sufficient funds through
equity to fund development and exploration activities.
There were no changes in the Group’s approach to capital management during the year. Risk
management policies and procedures are established with regular monitoring and reporting. Neither the
Company nor any of its controlled entities are subject to externally imposed capital requirements.
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2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
2
FINANCIAL RISK MANAGEMENT (CONTINUED)
(e) Impairment Losses
During the 2019 reporting period $75,473 was written off in relation to the Group’s financial assets (2018:
nil).
(f) Fair values versus carrying amounts
The carrying amounts of financial assets and liabilities as described in the consolidated statement of
financial position represent their estimated net fair value, expect for the deferred consideration payment
for the purchase of the Kou Sa Project which is carried at its fair value.
3
CRITICAL ACCOUNTING ESTIMATES AND JUDGMENTS
Estimates and judgments are continually evaluated and are based on historical experience and other factors
including expectations of future events that may have a financial impact on the Group and that are believed
to be reasonable under the circumstances. The Group makes estimates and assumptions concerning the
future. The resulting accounting estimates will, by definition, seldom equal the related actual results.
Key judgments
Exploration and evaluation expenditure
The Group’s policy in relation to the accounting for exploration and evaluation expenditure is stated in Note
1(k). There is judgment involved in determining the treatment of exploration and evaluation expenditure,
including, determining whether it should be carried forward as capitalised exploration, transferred to mine
properties under development, or written off to the consolidated statement of profit or loss and
comprehensive income.
The Board and management give due consideration to the areas of interest relating to the exploration and
evaluation expenditure on a regular basis and are confident that decisions to either transfer, write off or
carry forward such expenditure fairly reflects the prevailing situation. In the year ended 31 December 2019,
$30,461,193 (2018: nil) of previously capitalised exploration and evaluation expenditure was transferred to
mine properties under development and no exploration and evaluation expenditure previously capitalised
has been written off (2018: $43,306,477).
Mine properties under development
The Group’s policy in relation to the accounting for mine properties under development is stated in Note 1(l).
There is judgment involved in determining the treatment of mine properties under development, including,
determining whether it should be carried forward as capitalised mine properties under development,
transferred to property, plant and equipment, transferred to exploration and evaluation expenditure or
written off to the consolidated statement of profit or loss and comprehensive income.
The Board and management give due consideration to the areas of interest relating to mine properties under
development on a regular basis and are confident that decisions to either transfer, write off or carry forward
such expenditure fairly reflects the prevailing situation. In the year ended 31 December 2019, no mine
properties under development has been transferred or written off (2018: nil).
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76
2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
3
CRITICAL ACCOUNTING ESTIMATES AND JUDGMENTS (CONTINUED)
Key judgments (continued)
Assets held for sale
Assets held for sale are measured at the lower of cost and fair value less estimated costs of disposal. If the
fair value at reporting date is lower than the carrying value, an impairment for the difference is recognised
in the Group’s financial report.
At 30 June 2019, management formed the view that the Fijian Group no longer met the requirements of
AASB 5. As a result, the underlying assets and liabilities of the Fijian Group were reclassified into their natural
categories on the consolidated statement of financial position. The value of assets held for sale was nil at 31
December 2019 (2018: $149,388) as stated in Note 12.
During the year ended 31 December 2018 the decision was made not to renew the Raki Raki, Qalau, Tabuka,
Cakaudrove and Nuku licences held by the Fijian Group. In light of these circumstances, a full write down to
the carrying value of the capitalised expenditure for these licences was booked at 30 June 2018. The Board
and management reviewed the remaining net assets of the Fijian Group at 31 December 2018 and
determined their fair value. As such a total impairment loss of $7,012,198 was recognised for the Fijian Group
assets held for sale for the year ended 31 December 2018.
Deferred consideration – discount rate
The Group cannot readily determine the interest rate implicit in the deferred consideration liability,
therefore, it uses its discount cash rate to present value the deferred consideration liability. The discount
cash rate is the rate of interest that the Group would have to pay to borrow over a similar term, and with a
similar security, the funds necessary to obtain an asset of a similar value to the remaining purchase price of
the Kou Sa Project in a similar economic environment. The discount cash rate therefore reflects what the
Group ‘would have to pay’, which requires estimation when no observable rates are available. The Group
estimates the discount cash rate using observable inputs (such as market interest rates) when available and
is required to make certain entity-specific estimates (such as the subsidiary’s stand-alone credit rating). The
deferred consideration has been present valued using a discount cash rate of 20% per annum (2018: 20%).
Key Estimates
Share based payments
The Group measures the cost of equity-settled transactions by reference to the fair value of the equity
instruments at the date at which they are granted. The fair value is determined by a combination of internal
and external sources using a Black-Scholes option pricing model and independent third party valuations.
Refer Note 26 for details of estimates and assumptions used.
83 | P a g e
77
2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
4
PARENT COMPANY INFORMATION
The following information has been extracted from the books and records of the parent entity and has been
prepared in accordance with Accounting Standards.
STATEMENT OF FINANCIAL POSITION
Assets
Current assets
Non-current assets
Total Assets
Liabilities
Current liabilities
Non-current liabilities
Total Liabilities
Equity
Issued capital
Reserves
Accumulated losses
Total Equity
STATEMENT OF COMPREHENSIVE INCOME
Total loss
TOTAL COMPREHENSIVE LOSS
Guarantees
Parent
2019
$
2018
$
37,158,663
33,939,118
71,097,781
2,871,665
29,978,189
32,849,854
591,501
27,905
619,406
606,648
-
606,648
149,029,347
705,133
(79,256,105)
70,478,375
104,116,108
(668,985)
(71,203,917)
32,243,206
(8,052,188)
(8,052,188)
(55,680,687)
(55,680,687)
Geopacific has not entered into any guarantees, in relation to the debts of its subsidiaries (2018: None).
The Company has term deposits of $132,000 (2018: $132,000) over the lease of its office premises and credit
card facilities. This has been classified as receivables.
Contingent liabilities
At 31 December 2019, Geopacific had no contingent liabilities (2018: nil).
Contractual commitments
At 31 December 2019, Geopacific had not entered into any contractual commitments for the acquisition of
property, plant and equipment (2018: nil).
84 | P a g e
78
2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
5
FINANCE INCOME
Other income
Interest income – financial institutions
Total finance income
6
LOSS BEFORE INCOME TAX
Loss before income tax includes the following specific expenses:
Contributions to defined superannuation funds
Total
7
REMUNERATION OF AUDITORS
The Auditor of Geopacific is Ernst & Young (2018: Ernst & Young).
Amounts received or receivable - Ernst & Young for:
- An audit or review of the financial report
Total
Amounts received or receivable - Greenwich & Co Audit Pty Ltd for:
- An audit or review of the financial report
- Tax Services
Total
Consolidated
2019
$
2018
$
61,231
32,519
93,750
-
64,013
64,013
Consolidated
2019
$
2018
$
101,022
101,022
166,768
166,768
Consolidated
2019
$
2018
$
57,500
57,500
-
-
-
67,500
67,500
12,091
2,200
14,291
85 | P a g e
79
2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
8
INCOME TAX
(a)
The components of the income tax benefit comprise:
Current tax
Deferred tax
Total tax benefit
Total tax benefit is attributable to:
Loss from continuing operations
Loss from discontinued operation
Total tax benefit
(b)
Reconciliation of income tax to prima facie tax benefit:
Net loss before tax
Loss from discontinued operation
Consolidated
2019
$
2018
$
-
-
-
-
-
-
-
(2,570,029)
(2,570,029)
(474,749)
(2,095,280)
(2,570,029)
Consolidated
2019
$
2018
$
(7,337,714)
-
(7,337,714)
(49,216,584)
(7,104,104)
(56,320,688)
Prima facie tax benefit at 30% (2018: 30%)
(2,201,314)
(16,896,206)
Adjusted for the tax effect of:
Non-deductible share based payments
Other non-deductible expenses
Impairment charge
Tax losses not recognised
Total tax benefit
412,236
637,565
-
1,151,513
-
212,811
2,929
13,269,107
841,330
(2,570,029)
86 | P a g e
80
2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
8
INCOME TAX (CONTINUED)
(c)
Deferred tax:
Deferred tax assets:
Business related costs/employee entitlements
Tax losses
Total before offset
Offset by deferred tax liabilities
Total deferred tax assets after offset
Deferred tax liabilities:
Exploration and evaluation expenditure
Mine properties under development
Total before offset
Offset by deferred tax assets
Total deferred tax liabilities after offset
(d)
Deferred tax assets not recognised:
Deferred tax assets not recognised
Tax losses not brought to account
Provisions
Business related Costs
Total deferred tax assets not recognised
Movement of tax losses not brought to account
Tax losses not brought to account - beginning of the year
Additions
Under/(Over)
Foreign exchange fluctuation
Tax losses not brought to account – end of the year
Consolidated
2019
$
2018
$
53,788
9,788,094
9,841,882
(9,841,882)
-
59,547
9,315,183
9,374,730
(9,374,730)
-
600,833
9,241,049
9,841,882
(9,841,882)
-
9,374,730
-
9,374,730
(9,374,730)
-
Consolidated
2019
$
2018
$
55,194,328
28,048
193,990
55,416,366
44,149,377
29,741
217,997
44,397,116
44,149,377
1,151,512
9,588,905
304,532
55,194,328
43,308,047
841,332
-
-
44,149,377
Deferred tax assets relating to tax losses have only been recognised in Papua New Guinea to the extent of
the deferred tax liability balance.
The deferred tax assets relating to the remainder of the Group have not been recognised in the current
reporting period as the Directors do not believe the realisation is probable at this point in time.
87 | P a g e
81
2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
9
CASH AND CASH EQUIVALENTS
Current
Cash at bank
Total Cash and Cash Equivalents
10
RECEIVABLES
Current
Security deposits
Sundry debtors
GST receivable
Loan receivable
Total Current Trade and Other Receivables
Consolidated
2019
$
2018
$
37,505,067
37,505,067
3,059,221
3,059,221
Consolidated
2019
$
2018
$
264,532
40,930
382,255
-
687,717
142,417
64,805
34,112
75,283
316,617
Write down
During the reporting period a write down of $75,283 (2018: Nil) was recorded in respect of the loan
receivable.
11
PREPAYMENTS
Current
Village relocation materials
Total Prepayments
82
Consolidated
2019
$
2018
$
1,027,731
1,027,731
-
-
88 | P a g e
2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
12
ASSETS CLASSIFIED AS HELD FOR SALE
Current
Assets held for sale
Movement during the year
Carrying value - beginning of the year
Movement during the period
Impairment write down
Other net liabilities reversed
Transfer to cash and cash equivalents
Transfer to receivables
Transfer to plant and equipment
Transfer to trade and other payables
Carrying value - end of the year
Consolidated
2019
$
2018
$
-
149,388
149,388
1,219
-
-
(6,825)
(141,509)
(9,964)
7,691
-
4,831,070
235,236
(7,012,198)
2,095,280
-
-
-
-
149,388
The Group undertook a sales process for its Fijian subsidiaries. This sales process did not find a buyer and as
a result the underlying assets and liabilities of the Fijian Group were reclassified into their natural categories
on the consolidated statement of financial position.
13
INVENTORY
Current
Consumables
Kitchen stocks
Cleaning stocks
Medical stocks
Protective clothing
Total
Consolidated
2019
$
2018
$
295,401
30,096
6,641
5,583
1,871
339,592
165,542
62,486
8,331
3,871
2,541
242,771
Write down
During the year ended 31 December 2019 there were consumables and kitchen stock which expired or were
damaged and as such had no net realisable value. The full amount of $30,822 (2018: $173,235) was written
off from inventory in the consolidated statement of profit or loss and other comprehensive income.
89 | P a g e
83
2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
14
EXPLORATION AND EVALUATION ASSETS
Consolidated
2019
$
2018
$
Non-current
8,262,803
37,494,025
Movement during the year
Carrying value - beginning of the year
Additions
Transfers from property, plant and equipment
Impairment write downs
Transfers to mine properties under development
Foreign exchange fluctuation
Carrying value - end of the year
37,494,025
442,022
-
-
(30,461,193)
787,949
8,262,803
67,389,026
8,447,600
80,759
(43,306,477)
-
4,883,117
37,494,025
Transfer to mine properties under development
In October 2019, the Group raised over $40 million via share a Placement and Share Purchase Plan to advance
the Woodlark Gold Project and development activities. Management are of the view that completing the
Placement and commencing development activities demonstrates the technical feasibility and commercial
viability of the Woodlark Gold Project. As a result, the capitalised exploration and evaluation expenditure
associated with the Woodlark Gold Project’s mining licence was reclassified to mine properties under
development.
In accordance with the accounting standards, an assessment for impairment was conducted before the
reclassification occurred. No indicators of impairment were present at the date of reclassification, therefore
the Group did not impair any previously capitalised exploration and evaluation expenditure prior to its
reclassification.
Write down
At 31 December 2019, the Group conducted an assessment to determine whether there were any indicators
of impairment in relation to the carrying value of its capitalised exploration and evaluation assets. No
indicators of impairment were present, therefore the Group did not impair any previously capitalised
exploration and evaluation expenditure (2018: $43,306,477).
Costs not directly relating to the advancement of the Group’s exploration projects were expensed as
exploration expenditure in the consolidated statement of profit or loss and other comprehensive income.
For the 2019 reporting period this amounted to $1,501,751 (2018: nil).
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84
2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
15
MINE PROPERTIES UNDER DEVELOPMENT
Non-current
Movement during the year
Carrying value - beginning of the year
Transfers from exploration and evaluation
Transfers from property, plant and equipment
Additions
Foreign exchange fluctuation
Carrying value - end of the year
Consolidated
2019
$
2018
$
30,803,497
-
30,461,193
60,855
860,265
(578,816)
30,803,497
-
-
-
-
-
-
-
Transfer from exploration and evaluation expenditure
In October 2019, the Group raised over $40 million via share a Placement and Share Purchase Plan to advance
the Woodlark Gold Project and development activities. Management are of the view that completing the
Placement and commencing development activities demonstrates the technical feasibility and commercial
viability of the Woodlark Gold Project. As a result, the capitalised exploration and evaluation expenditure
associated with the projects mining licence was reclassified to mine properties under development.
Write down
At 31 December 2019, the Group conducted an assessment to determine whether there were any indicators
of impairment in relation to the carrying value of its mine properties. No indicators of impairment were
present, therefore the Group did not impair any capitalised mine properties under development (2018: nil).
91 | P a g e
85
2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
16
PROPERTY, PLANT AND EQUIPMENT
2019
Consolidated
Right-of-
use asset
$
Work under
construction
$
Plant &
Equipment
$
Computer
Software
$
Furniture
& Fittings
$
Total
$
Gross carrying amount – at cost
Less: accumulated depreciation
Balance
186,225
(101,577)
84,648
472,105
-
472,105
5,106,267
(4,354,656)
751,611
98,737 1,043,349
(460,797)
582,552
(97,368)
1,369
6,906,683
(5,014,398)
1,892,285
2018
Gross carrying amount – at cost
Less: accumulated depreciation
Balance
Plant & Equipment
Movement 2019
Consolidated
Plant &
Equipment
$
Computer
Software
$
Furniture
& Fittings
$
Total
$
4,760,940
(4,573,037)
187,903
144,760 1,088,081
(437,153)
650,928
(141,980)
2,780
5,993,781
(5,152,170)
841,611
Right-of-
use asset
$
Work under
construction
$
Plant &
Equipment
$
Computer
Software
$
Furniture
& Fittings
$
Total
$
Balance at 1 January 2019
Additions
Disposals
Transfers from assets held for sale
Transfers to mine properties under
development
Impact of adopting AASB 16
Foreign exchange fluctuation
Depreciation
Balance at 31 December 2019
-
-
-
-
-
186,225
-
(101,577)
84,648
-
462,394
-
-
9,418
-
293
-
472,105
187,903
631,353
(8,604)
9,964
(19,938)
-
1,511
(50,578)
751,611
2,780
865
-
-
-
-
-
(2,276)
1,369
650,928
24,179
(1,593)
-
(50,335)
-
4,297
(44,924)
582,552
841,611
1,118,791
(10,197)
9,964
(60,855)
186,225
6,101
(199,355)
1,892,285
Plant &
Equipment
$
Computer
Software
$
Furniture
& Fittings
$
Total
$
181,349
71,061
(44,268)
4,106
(24,345)
187,903
9,557
114
-
-
(6,891)
2,780
505,110
175,226
(36,491)
11,968
(4,885)
650,928
696,016
246,401
(80,759)
16,074
(36,121)
841,611
92 | P a g e
Plant & Equipment
Movement 2018
Balance at 1 January 2018
Additions
Transfers to exploration
Foreign exchange fluctuation
Depreciation
Balance at 31 December 2018
86
2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
17
TRADE AND OTHER PAYABLES
Current
Trade creditors and accrued expenses
Deferred consideration
Total
Non-current
Deferred consideration
Total
Deferred consideration movement during the year
Carrying value - beginning of the year
Unwind of the discount – finance cost
Foreign exchange fluctuation
Carrying value - end of the year
Consolidated
2019
$
2018
$
1,950,327
5,040,896
6,991,223
844,874
2,391,955
3,236,829
2,694,195
2,694,195
3,852,972
3,852,972
6,244,927
1,443,017
47,147
7,735,091
4,622,793
1,123,578
498,556
6,244,927
In January 2015, the Company’s subsidiary, Royal Australia Resources Ltd, entered into an agreement to acquire
100% of the issued capital of Golden Resource Development Co Ltd for US$14 million of which US$7.7 million
has already been paid.
The Company renegotiated the payment schedule in relation to its agreement with the Vendors in September
2016. Under the revised terms, the non-contingent instalments of the purchase price are to be paid as follows:
a) US$1.575 million due at completion of a bankable feasibility study for the Kou Sa Project or by 21
September 2019, whichever is earlier; and
b) US$4.725 million paid in equal monthly instalments over three years after payment of the US$1.575
million.
The deferred consideration has been present valued using a discount cash rate at 31 December 2019 of 20%
(2018: 20%).
The Company is in negotiation with the vendors of the Kou Sa Project to restructure the deferred
consideration payments. At 31 December 2019, payments of US$1.57 million and US$0.39 million were
outstanding. In the event an agreement cannot be reached with the vendors, the Group will look to relinquish
ownership of the Kou Sa Project and would be required to pay US$0.50 million to the vendors.
93 | P a g e
87
2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
18
PROVISIONS
Current
Employee provisions
Total
Non-current
Rehabilitation provision
Employee provisions
Total
Movements
Rehabilitation provision
Balance at 1 January
Foreign exchange fluctuation
Balance at 31 December
19
ISSUED CAPITAL
Consolidated
2019
$
2018
$
65,590
65,590
135,569
135,569
179,293
27,905
207,198
178,183
14,365
192,548
178,183
1,110
179,293
173,714
4,469
178,183
Consolidated
2019
$
2018
$
Issued Capital
148,972,741
104,116,108
Reconciliation of movements in Issued Capital during the period:
Date
Shares
$
Shares
$
2019
2018
Balance at 1 January
Shares issued pursuant to a Placement
Shares issued pursuant to a Placement
Consideration for acquisition of Woodlark(i)
Conversion of Options
Shares issued pursuant to a Placement
Shares issued as part of a SPP
Shares issued pursuant to a Placement
Adjustment for share consolidation
Less: share issue costs
Balance at 31 December
18-Jun-18
05-Apr-19
02-Jul-19
11-Jul-19
28-Oct-19
09-Dec-19
17-Dec-19
20-Dec-19
2,081,907,130
-
510,000,000
150,000,000
17,188,888
689,774,033
4,040,000
910,225,997
(4,188,610,288)
-
104,116,108
-
4,335,000
2,850,000
-
17,244,350
101,000
22,755,650
-
(2,429,367)
1,801,907,130
280,000,000
-
-
-
-
-
-
-
-
94,432,822
10,080,000
-
-
-
-
-
-
-
(396,714)
174,525,760
148,972,741
2,081,907,130
104,116,108
(i)Acquisition of the remaining interest in Woodlark Mining Limited was settled by the issue of 150,000,000 shares in Geopacific to
Kula Gold Limited at a share price of $0.019 per share.
94 | P a g e
88
2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
20
RESERVES
(a) Reserves
Share-based payments reserve
Foreign currency translation reserve
Other equity reserve
Total
(b) Movements
Share-based payments reserve
Balance at 1 January
Share based payment expense
Balance at 31 December
Foreign currency translation reserve
Balance at 1 January
Exchange (losses)/gains during year
Balance at 31 December
Other equity reserve
Balance at 1 January
Transfers during the year
Balance at 31 December
Total reserves
(c) Nature and purpose of reserves
Share-based payments reserve
The share-based payments reserve records:
Consolidated
2019
$
2018
$
2,873,328
3,340,531
(1,370,317)
4,843,542
1,499,209
3,535,896
755,748
5,790,853
1,499,209
1,374,119
2,873,328
789,838
709,371
1,499,209
3,535,896
(195,365)
3,340,531
(1,172,966)
4,708,862
3,535,896
755,748
(2,126,065)
(1,370,317)
-
755,748
755,748
4,843,542
5,790,853
(cid:31)
(cid:31)
(cid:31)
the value of exercised and unexercised options issued or granted to employees and Directors which
have been expensed;
the value of exercised and unexercised performance rights and share appreciation rights issued to
employees and Directors which have been expensed; and
the value of options issued on acquisition of Millennium Mining (Fiji) Ltd.
Foreign currency translation reserve
The foreign currency translation reserve records unrealised exchange gains and losses on translation of the
Group’s controlled entities’ results and financial position where their functional currency is different to the
Group’s presentation currency.
Other equity reserve
The other equity reserve records transfers of interests to the Group from non-controlling interests.
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2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
21
CONTINGENT LIABILITIES
Kou Sa – Revised Repayment Schedule
In January 2015, the Company’s subsidiary, Royal Australia Resources Ltd, entered into an agreement to
acquire 100% of the issued capital of Golden Resource Development Co Ltd for US$14 million plus interest
payments of US$1,275,750.
The Company renegotiated the payment schedule in relation to its agreement with the Vendors in September
2016. Other than the remaining non-contingent instalments of the purchase price to be paid as described in
Note 17, a 2% net smelter royalty on sales of production from the Kou Sa project is payable, capped at US$3.7
million. This royalty is conditional upon production from the Kou Sa project.
The Company is in negotiation with the vendors of the Kou Sa Project to restructure the deferred
consideration payments. At 31 December 2019, payments of US$1.57 million and US$0.39 million were
outstanding. In the event an agreement cannot be reached with the vendors, the Group will look to relinquish
ownership of the Kou Sa Project and would be required to pay US$0.50 million to the vendors.
The Group did not have any other contingent liabilities at the end of the reporting period (2018: nil).
22
COMMITMENTS
(a)
Tenement Commitments
Entities in the Group are required to spend certain amounts to retain their interest in areas over which Special
Prospecting Licenses are held. All requirements have been complied with and all reports and lodgements
have been made. In the ordinary course of business, the Group is currently waiting on the reissue of certain
licences by the Mineral and Resource Departments of Papua New Guinea.
The following table provides an outline of the annual expenditure required by tenement:
Tenement
EL 1172
EL 1279
EL 1465
Kou Sa
Location
Papua New
Guinea
Papua New
Guinea
Papua New
Guinea
Cambodia
Tenement
Renewed
to
27-Nov-19
25-Aug-19
Annual
Commitment
2020
Comments
105,219 Licence renewal lodged with authorities for
an additional two years. Renewal Pending.
105,219 Licence renewal lodged with authorities for
an additional two years. Renewal Pending.
22-Dec-20
84,175
13-Mar-21
33,428
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2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
22
COMMITMENTS (continued)
(b) Operating Commitments
During December 2019 the Group entered into contracts with HBS Machinery and Rhodes to commence the
Civil Works Program at the Woodlark Gold Project. The future lease payments for the HBS non-cancellable
lease contracts is $3,831,422. The committed expenditure for the Rhodes contact is $4,530,853. Both of these
contracts are scheduled to be completed within one year. Prior period operating commitments have been
reclassified as right-of-use assets and lease liabilities.
Class of
Share
Effective Ownership
Percentage
23
PARTICULARS RELATING TO CONTROLLED ENTITIES
(a) Material Subsidiaries
Country of
Incorporation
and Carrying
on Business
Worldwide Mining Projects Pty Ltd
PT IAR Indonesia Ltd
Eastkal Pte Ltd
Royal Australia Resources Ltd
Golden Resource Development
Geopacific Limited
Beta Limited
Millennium Mining (Fiji) Limited
Woodlark Mining Limited
Kula Gold Limited
Australia
Indonesia
Singapore
Cambodia
Cambodia
Fiji
Fiji
Fiji
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Papua New Guinea Ordinary
Ordinary
Australia
2019
%
100
100
100
85
100
100
100
100
100
-
2018
%
100
100
100
85
100
100
100
100
93
85
Worldwide Mining Projects Pty Ltd and Petrochemicals (Cambodia) Refinery Ltd entered into a Shareholders
Agreement in December 2012 to explore, develop and hold the Kou Sa project. Petrochemicals (Cambodia)
Refinery Ltd will be a free carried partner until a decision to mine on the Kou Sa project area is made.
In the event that a decision to mine is made, Petrochemicals (Cambodia) Refinery Ltd will be granted an
option to purchase further shares in Royal Australia Resources Ltd at fair market value to increase its
percentage shareholding to 20%; and contribute to all costs, expenses and liabilities incurred or sustained in
proportion to its shareholding interest in Royal Australia Resources Ltd.
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2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
23
PARTICULARS RELATING TO CONTROLLED ENTITIES (CONTINUED)
(b) Non-Controlling Interests
Set out below is summarised financial information for each subsidiary that has non-controlling interests that
are material to the group. The amounts disclosed for each subsidiary are before inter-company eliminations.
Summarised statement of financial position
Current assets
Non-current assets
Total Assets
Current liabilities
Non-current liabilities
Total Liabilities
Net Assets
Accumulated Non-controlling interest
Summarised statement of comprehensive income
Income
Loss for the period
Other comprehensive income
Total comprehensive (loss)/income
Woodlark Mining Limited
2019
$
2018
$
-
-
-
-
-
-
-
-
586,895
31,989,173
32,576,068
281,029
19,979,046
20,260,075
12,315,993
904,359
2019
$
2018
$
-
(304,764)
169,587
(135,177)
-
(233,150)
1,466,866
1,233,716
Profit allocated to Non-controlling interest
(9,926)
89,536
Summarised cash flows
Cash flows from operating activities
Cash flows from investing activities
Cash flows from financing activities
Net (decrease)/increase in cash and cash equivalents
2019
$
2018
$
(400,012)
(105,457)
303,247
(202,222)
(33,894)
(7,460,869)
7,601,442
106,679
On 25 June 2019, the Group received approval to acquire all of the rights and interests in Woodlark Mining
Limited, consolidating the Group’s 100% direct ownership of the Woodlark Gold Project. Therefore, at 31
December 2019 there was no summarised statement of financial position amounts relating to non-controlling
interests for Woodlark Mining Limited. The summarised statement of comprehensive profit or loss and other
comprehensive income and summarised cash flows show the transactions that occurred during the year prior
to the completion of the acquisition while there was still a non-controlling interest in Woodlark Mining
Limited.
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2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
24
KEY MANAGEMENT PERSONNEL DISCLOSURES
(a) Directors
Details of each person holding the position of Director of the Company during the current and prior reporting
periods are outlined in the table below:
Name
Non-Executive Directors
Ian Clyne
Colin Gilligan
Ian Murray
Milan Jerkovic
Mark Bojanjac
Executive Directors
Ron Heeks
Appointed 9 September 2019
Resigned 8 May 2019
Resigned 29 May 2019
(b) Other Key Management Personnel (KMP)
Position
Non-Executive Chairman
Non-Executive Director
Non-Executive Director
Non-Executive Chairman
Non-Executive Director
Managing Director
Details of the Other KMP of the Group during the current and prior reporting periods are set out in the table
below:
Name
Executives
Matthew Smith
Glenn Zamudio
James Kerr
Resigned 31 May 2019
(c)
KMP Compensation
Key Management Personnel Compensation:
Short term benefits
Post-employment benefits
Share based payments
Annual leave
Long term benefits
Termination payments
Total
25
RELATED PARTY TRANSACTIONS
Position
Chief Financial Officer & Company Secretary
General Manager - Projects
General Manager - Geology
Consolidated
2019
$
2018
$
1,010,162
68,397
978,482
44,230
5,862
20,769
2,127,902
1,280,000
101,888
646,142
23,884
4,360
140,000
2,196,274
During the year ended 31 December 2019 the Group did not enter into any related party transactions with
Directors (2018: $Nil).
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2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
26
SHARE-BASED PAYMENTS
(a)
Employee Incentive Plan
The Company’s Securities Incentive Plan was approved by shareholders at the Annual General Meeting held
on 30 May 2018. All employees are eligible to participate in the plan.
Instruments granted under the plan are issued for no consideration, carry no dividend or voting rights and
when exercised convert into ordinary shares.
Included under share based payments expense in the statement of profit or loss and other comprehensive
income is an amount of $1,374,119 (2018: $709,371) which relates to equity settled share based payments
transactions issued under the plan.
All options granted to key management personnel are for ordinary shares in Geopacific, which confer a right
of one ordinary share for every option held.
All share appreciation rights granted to key management personnel are for ordinary shares in Geopacific
Resources Limited, which confer an amount of shares equal to the difference between the Company’s share
price at the end of the vesting period and the price on grant date.
During the reporting period the Company issued four types of incentives to employees. They were short term
zero exercise price options (ZEPO’s), medium term ZEPO’s, premium exercise price options (PEPO’s) and
share appreciation rights (SAR’s). These incentives were granted on 30 May 2019 and 12 July 2019 and were
issued in accordance with the Securities Incentive Plan. The vesting condition of each incentive is continuous
employment (at Board discretion).
All incentives issued during the 2019 reporting period were issued prior to the 25:1 share consolidation that
took place in December 2019. All incentives were adjusted at the time of the consolidation to reduce the
number of incentives (reduced 25:1) and increase the exercise price (increased 25:1) where relevant.
100 | P a g e
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2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
26
SHARE-BASED PAYMENTS (CONTINUED)
(a)
Employee Incentive Plan (continued)
The incentives were valued by a combination of internal and external sources using a Black-Scholes option
pricing model and independent third party valuations. The key inputs and valuations are summarised below:
Item
Underlying share value
Exercise price
Valuation date(i)
Vesting date
Vesting period (years)
Expiry date
Life of the options (years)
Volatility(ii)
Risk free rate
Dividend yield
Granted on 30 May 2019
Number of options(i)
Value per option(i)
Value per tranche(i)
Short Term
ZEPO’s
Medium Term
ZEPO’s
PEPO’s
SAR’s
$0.016
Nil
12-Jul-19
19-Jul-20
1.00
19-Jul-20
1.02
90%
1.22%
Nil
$0.016
Nil
12-Jul-19
19-Jul-22
3.00
19-Jul-22
3.02
90%
1.22%
Nil
$0.016
$0.0233
12-Jul-19
19-Jul-23
4.00
19-Jul-23
4.02
90%
1.22%
Nil
$0.016
$0.016
12-Jul-19
19-Jul-22
3.00
19-Jul-22
4.02
90%
1.22%
Nil
261,538
$0.014
$3,362
9,174,808
$0.014
$128,447
7,951,500
$0.008
$63,612
7,620,188
$0.009
$68,582
Granted on 12 July 2019
Number of options
Value per option
Value per tranche
20,607,300
$0.010
$206,073
(i) The grant date for R. Heeks was determined as the AGM date, being 30 May 2019. The value per options differs for R Heeks
23,249,261
$0.016
$371,988
12,741,668
$0.016
$203,867
18,644,700
$0.009
$167,802
as the valuation was conducted on the grant date.
(ii) A volatility of the share price fluctuation was calculated by considering the historical movement of the share price over a
period of time as well factoring market conditions of its competitors to predict the distribution of relative share
performance.
101 | P a g e
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2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
26
SHARE-BASED PAYMENTS (CONTINUED)
(a)
Employee Incentive Plan (continued)
2019
2018
Number of
options or
rights
Weighted
average
exercise
price ($)
Number of
options or
rights
Weighted
average
exercise
price ($)
41,454,763
45,427,275
-
(17,188,888)
69,693,150
(66,905,415)
2,787,735
20,218,500
26,596,200
-
-
46,814,700
(44,942,110)
1,872,590
22,365,071
28,227,488
-
-
50,592,559
(48,568,852)
2,023,707
-
-
-
-
-
-
-
-
41,454,763
-
-
41,454,763
-
41,454,763
0.0408
0.0233
-
-
0.0309
0.7405
0.7714
-
20,218,500
-
-
20,218,500
-
20,218,500
0.0285(i)
0.0160(i)
-
-
0.0215
0.5166
0.5381(i)
-
22,365,071
-
-
22,365,071
-
22,365,071
-
-
-
-
-
-
-
-
0.0408
-
-
0.0408
-
0.0408
-
0.0285*
-
-
0.0285*
-
0.0285*
Zero exercise price options
Outstanding at beginning of year
Granted
Expired/lapsed
Exercised
Total pre-share consolidation
Adjusted for share consolidation
Outstanding at end of year
Premium exercise price options
Outstanding at beginning of year
Granted
Expired/lapsed
Exercised
Total pre-share consolidation
Adjusted for share consolidation(ii)
Outstanding at end of year
Share appreciation rights
Outstanding at beginning of year
Granted
Expired/lapsed
Exercised
Total pre-share consolidation
Adjusted for share consolidation(ii)
Outstanding at end of year
(i) The exercise price of the share appreciation rights – represents a theoretical exercise price given the payoff is the difference
between the Company’s share price at the end of the vesting period and the price on grant date.
(ii) The weighted average exercise price has been updated to reflect the 25:1 share consolidation.
The weighted average remaining contractual life of the incentives outstanding at 31 December 2019 are:
Instrument
Zero exercise price options
Premium exercise price options
Share appreciation rights
Years
1.82
3.11
3.10
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2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
26
SHARE-BASED PAYMENTS (CONTINUED)
(b) Unlisted Incentives
There were 40,000 options over unissued shares unexercised at reporting date (2018 – 1,000,000). Since the
end of the financial year, no unlisted options have been cancelled or exercised.
Details of unlisted options over unissued shares in the Company as at the date of this report are outlined in
the tables below:
2019
Issue Date
Expiry
Date
Exercise
Price(i)
Number on
Issue
Movement During the Year
6-Jun-09
6-Jun-09
Note (a)
Note (b)
$
62.50
125.00
1-Jan-19
800,000
200,000
1,000,000
Granted
-
-
-
Lapsed
-
-
-
Adjusted for share
consolidation
(768,000)
(192,000)
(960,000)
Number on
Issue
31-Dec-19
32,000
8,000
40,000
(i) The exercise price has been updated to reflect the 25:1 share consolidation conducted in December 2019.
(a) Not later than 5 years after defining a JORC compliant ore reserve of over 200,000oz Au on the Faddy’s Gold Deposit.
(b) Not later than 10 years after defining a JORC compliant ore reserve of over 1,000,000oz Au on the Faddy’s Gold Deposit.
2018
Issue
Date
Expiry
Date
6-Jun-09
6-Jun-09
Note (a)
Note (b)
Exercise
Price
$
2.50
5.00
Number on
Issue
1-Jan-18
800,000
200,000
1,000,000
Movement During the Year
Granted
-
-
-
Lapsed
-
-
-
Number on
Issue
31-Dec-18
800,000
200,000
1,000,000
(a) Not later than 5 years after defining a JORC compliant ore reserve of over 200,000oz Au on the Faddy’s Gold Deposit.
(b) Not later than 10 years after defining a JORC compliant ore reserve of over 1,000,000oz Au on the Faddy’s Gold Deposit.
(c)
Services
During the reporting period, the Company did not issue any shares as payment for services (2018: nil).
103 | P a g e
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2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
27
LOSS PER SHARE
(a)
Basic and Diluted Loss per Share
Basic loss per share:
From continuing operations attributable to the ordinary equity
holders of the company
From discontinued operation
Diluted loss per share:
From continuing operations attributable to the ordinary equity
holders of the company
From discontinued operation
(b)
Reconciliation of Loss Used in Calculating Loss Per Share
Basic and Diluted Loss Per Share:
Loss attributable to the ordinary equity holders of the Company
used in calculating basic and diluted loss per share:
From continuing operations
From discontinued operation
(c) Weighted Average Number of Shares Used as the Denominator
Weighted average number of ordinary shares used as the
denominator in calculating basic and diluted loss per share(i)
Consolidated
2019
Cents
2018
Cents
(6.48)
(0.00)
(6.48)
(6.48)
(0.00)
(6.48)
(2.49)
(0.25)
(2.74)
(2.49)
(0.25)
(2.74)
Consolidated
2019
$
2018
$
(7,337,714)
-
(7,337,714)
(48,741,835)
(5,008,824)
(53,750,659)
Consolidated
2019
No. of Shares
2018
No. of Shares
113,152,082
1,960,176,777
(i) The weighted average number of ordinary shares is reflective of the 25:1 share consolidation conducted in December 2019.
104 | P a g e
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2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
28
EVENTS OCCURRING AFTER BALANCE DATE
Subsequent to end of the financial year, the COVID-19 outbreak was declared a pandemic by the World
Health Organisation in March 2020.
The outbreak and the response of Governments in dealing with the pandemic is interfering with general
activity levels within the community, the economy and the operations of Geopacific’s business.
As a result of COVID-19, in March 2020 the Group implemented the following measures:
(cid:31) A notice of suspension was issued to HBS, the contractor engaged to undertake a Civil Works
Program;
(cid:31) All HBS staff were repatriated from Woodlark Island to ensure a safe passage to their home
countries;
(cid:31) All HBS equipment remains on site;
(cid:31) Rhodes remain on site to continue the village relocation program;
(cid:31) Rhodes and HBS will not be permitted to bring new personnel to Woodlark Island until it is
considered safe to do so;
(cid:31) All Geopacific expatriate staff were repatriated from Woodlark Island to Australia; and
(cid:31) Staff based in the Perth Office will comply with both domestic and international travel restrictions
and where possible, work from home to ensure the Company complies with social distancing
guidelines.
The scale and duration of the developments associated with COVID-19 remain uncertain as at the date of this
report. However, they could impact on the Group’s ability to raise equity and the Group’s financial results,
cash flow and financial position in future years.
It is not possible to estimate the impact relating to the near-term and longer effects of COVID-19, or
Governments’ varying efforts to combat the outbreak and support businesses. This being the case, we do
not consider it practicable to provide a quantitative or qualitative estimate of the potential impact of this
outbreak on the Group at this time.
The financial statements have been prepared based upon conditions existing at 31 December 2019 and due
consideration has been given to events that have occurred subsequent to 31 December 2019 that provide
evidence of conditions that existed at the end of the reporting period. As the outbreak of COVID-19 occurred
after 31 December 2019, its impact is considered an event that is indicative of conditions that arose after the
reporting period and accordingly, no adjustments have been made to financial statements as at 31 December
2019 for any impacts of COVID-19.
Other than the matter discussed above, no other matters or circumstances haves arisen since the end of the
financial period year which significantly affected or may significantly affect the operations of the Group, the
results of those operations, or the state of affairs of the Group in future financial years.
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2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
29
OPERATING SEGMENTS
The Group has identified its operating segments based on the internal reports that are reviewed by the Board
in assessing performance and determining the appropriate allocation of the Group’s resources. The Group
also has had regard to the qualitative thresholds for the determination of operating segments.
For management purposes the Group is organised into three operating segments based on geographical
locations, which involves mineral exploration and development in Cambodia, Fiji and Papua New Guinea. All
other corporate expenses are disclosed as “Corporate” within this segment report. The Group’s principal
activities are interrelated and the Group has no revenue from operations.
For the 31 December 2018 segment note, Fiji was classified under “Asset Held for Sale” to reflect the
accounting treatment of the Fijian Group at the time. As the Fijian Group is no longer held for sale it has been
separated as its own operating segment for the year ended 31 December 2019.
All significant operating decisions are based on analysis of the Group as three segments. The accounting
policies applied for internal reporting purposes are consistent with those applied in preparation of the
financial statements.
2019
Cambodia
$
Papua New
Guinea
$
Corporate
$
Fiji
$
Total
$
Other income
-
61,232
32,518
-
93,750
Net Loss for the year
(2,309,309)
(749,861)
(4,160,065)
(118,479)
(7,337,714)
Segment Assets
6,289,629
36,937,466
37,169,475
122,122
80,518,692
Segment Liabilities
8,170,401
1,250,510
619,406
-
10,040,317
2018
Cambodia
$
Papua New
Guinea
$
Corporate
$
Asset Held for
Sale
$
Total
$
Other income
-
-
64,013
Net Loss for the year
(44,935,949)
(233,150)
(4,047,485)
-
-
64,013
(49,216,584)
Segment Assets
6,325,530
32,576,068
3,052,647
149,388
42,103,633
Segment Liabilities
6,299,485
479,519
638,914
-
7,417,918
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2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
30
NOTES TO THE STATEMENT OF CASH FLOWS
(a)
Cash and Cash Equivalents
Cash and cash equivalents at the end of the financial year as shown in the Statement of Cash flows is
reconciled to the related items in the Statement of Financial Position as follows:
Cash at bank
Total
(b)
Reconciliation of Cash Flows from Operating Activities
Consolidated
2019
$
2018
$
37,505,067
37,505,067
3,059,221
3,059,221
Consolidated
2019
$
2018
$
Net loss after income tax
(7,337,714)
(53,750,659)
Adjustments for Non-cash Items:
Depreciation
Share based payments
Impairment write downs
Finance costs
Transactions with non-controlling interests
Proceeds from disposal of plant and equipment
Changes in Assets & Liabilities
Increase in trade and other receivables
(Increase) / Decrease in inventory
Increase / (Decrease) in trade and other payables
(Decrease) / Increase in provisions
Decrease in deferred tax liabilities
Net Cash Used in Operating Activities
(c) Non-cash financing activities
199,355
1,374,119
75,473
1,443,017
-
(61,232)
36,121
709,371
44,230,355
1,123,578
7,104,104
-
(302,748)
(96,821)
553,320
(61,781)
-
(4,215,012)
(300,575)
38,032
(189,223)
52,101
(2,570,029)
(3,516,824)
Consolidated
2019
$
2018
$
Shares issued as part of the Kula transaction(i)
2,850,000
-
(i)Acquisition of the remaining interest in Woodlark Mining Limited was settled by the issue of 150,000,000 shares in Geopacific to
Kula Gold Limited at a share price of $0.019 per share.
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2019 ANNUAL REPORT
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2019
31
DISCONTINUED OPERATION
The Group did not find a buyer for its Fijian subsidiaries and has relinquished the tenements which were due
to be renewed during the period. As a result, the underlying assets and liabilities were reclassified into their
natural categories on the consolidated statement of financial position and are no longer presented as held
for sale (Note 12).
The financial performance information for these companies while they were considered a discontinued
operation is presented below.
Statement of profit and loss
Income
Administration expense
Depreciation expense
Employee benefits expense
Occupancy expense
Impairment write downs
Loss before income tax
Income tax benefit
Loss from discontinued operation
Earnings per share
Basic loss per share from discontinued operation:
Diluted loss per share from discontinued operation:
102
2019
$
2018
$
-
-
-
-
-
-
-
-
-
-
-
(23,079)
(1,751)
(46,634)
(20,442)
(7,012,198)
(7,104,104)
(7,104,104)
2,095,280
(5,008,824)
Consolidated
2019
Cents
2018
Cents
-
-
(0.26)
(0.26)
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2019 ANNUAL REPORT
SHAREHOLDER INFORMATION
GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
SHAREHOLDER INFORMATION
The shareholder information set out below was applicable as at 18 March 2020.
(a)
Analysis of numbers of equity security holders by size of holding:
Analysis of numbers of equity security holders by size holding:
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 and over
Total
(b)
Equity security holders – ordinary shares
Class of Equity Security
Ordinary Shares
Number
Shares
296
457
181
357
104
1,395
152,147
1,180,786
1,337,236
11,316,714
160,538,877
174,525,760
The names of the twenty largest holders of quoted equity securities, ordinary shares, are listed below:
NDOVU CAPITAL IV B V
DELPHI UNTERNEHMENBERATUNG
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
J P MORGAN NOMINEES AUSTRALIA
NATIONAL NOMINEES LIMITED
HOME IDEAS SHOW PTY LTD
GWYNVILL TRADING PTY LTD
BRISPOT NOMINEES PTY LTD
CITICORP NOMINEES PTY LIMITED
WASHINGTON H SOUL PATTINSON AND COMPANY
CS FOURTH NOMINEES PTY LIMITED
MR CRAIG GRAEME CHAPMAN
HENDERSON INTERNATIONAL PTY LIMITED
QUOTIDIAN NO 2 PTY LTD
DIXSON TRUST PTY LIMITED
MORGAN STANLEY AUSTRALIA SECURITIES (NOMINEE) PTY LIMITED
UBS NOMINEES PTY LTD
CS THIRD NOMINEES PTY LIMITED
BNP PARIBAS NOMS PTY LTD
BRIAR PLACE PTY LTD
TOP 20 SHAREHOLDERS
OTHER SHAREHOLDERS
TOTAL ORDINARY SHAREHOLDERS
Ordinary Shares
Number
Held
31,453,391
27,236,434
25,019,927
10,619,884
8,703,194
7,835,994
3,510,983
3,146,127
2,658,444
2,616,320
2,495,367
2,000,000
1,432,542
1,396,811
1,360,000
1,319,999
1,309,708
1,251,128
983,910
866,471
137,216,634
37,309,126
174,525,760
% of
Issued
Shares
18.02
15.61
14.34
6.08
4.99
4.49
2.01
1.80
1.52
1.50
1.43
1.15
0.82
0.80
0.78
0.76
0.75
0.72
0.56
0.50
78.63
21.37
100.00
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2019 ANNUAL REPORT
SHAREHOLDER INFORMATION
GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
SHAREHOLDER INFORMATION
(c)
Substantial holders
Extracts from substantial shareholder register:
TEMBO CAPITAL
DELPHI UNTERNEHMENBERATUNG AG
SPHERIA ASSET MANAGEMENT
FRANKLIN ADVISERS, INC
Shareholding
Number Held
% of Issued
Shares
32,086,031
17,876,434
786,746
683,566
18.40
16.20
11.27
9.79
The above holdings are based on the most recent Notice of Change of Interests of Substantial Holder
statements lodged by each substantial holder. The number of shares held has been adjusted for the 25:1
share consolidation conducted in December 2019.
(d)
Voting rights
The voting rights attached to each class of equity securities are set out below:
Fully paid Ordinary Shares
On a show of hands, every member present at a meeting in person or by proxy shall have one vote and
upon a poll each share shall have one vote.
Options – listed and unlisted
There are no voting rights attached to options.
(e)
Summary of unlisted options issued
Options expiring not later than five years after
the defining on Faddy's Gold Deposit of a JORC
complaint Ore Reserve of over 200,000 oz of
contained Au with an exercise price of $62.50
Option holder with more than 20% of class
Exploration Drilling Services (Fiji) Ltd
L Anderson Investments Pty Ltd
Sheila Anderson Investments
Options expiring not later than ten years after
the defining on Faddy's Gold Deposit of a JORC
compliant Ore Reserve of over 1,000,000 oz of
contained Au with an exercise price of $125.00
Option holder with more than 20% of class
Exploration Drilling Services (Fiji) Ltd
L Anderson Investments Pty Ltd
Sheila Anderson Investments
104
Number of
Options
Number of
Holders
Options
Held
% of
Options
Issued
32,000
5
8,000
5
12,800
8,800
7,200
3,200
2,200
1,800
40.0
27.5
22.5
40.0
27.5
22.5
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SHAREHOLDER INFORMATION
GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
SHAREHOLDER INFORMATION
(e)
Summary of unlisted options issued (continued)
Number of
Options
Number of
Holders
Options
Held
% of
Options
Issued
Zero exercise price options expiring three years
from the issue date on 10 July 2021
Option holder with more than 20% of class
R Heeks
Premium exercise price options expiring four
years from the issue date on 10 July 2022
Option holder with more than 20% of class
R Heeks
Share appreciation rights expiring four years
from the issue date on 10 July 2022
Option holder with more than 20% of class
R Heeks
Zero exercise price options expiring one years
from the issue date on 19 July 2020
Option holder with more than 20% of class
M Smith
G Zamudio
Zero exercise price options expiring 13 years
from the issue date on 19 July 2022
Option holder with more than 20% of class
R Heeks
Premium exercise price options expiring four
years from the issue date on 19 July 2023
Option holder with more than 20% of class
R Heeks
Share appreciation rights expiring four years
from the issue date on 19 July 2023
Option holder with more than 20% of class
R Heeks
970,638
808,740
894,605
520,131
1,296,965
1,063,850
1,129,101
6
6
6
5
5
5
5
220,875
22.8
195,300
24.1
193,529
21.6
193,539
193,539
37.2
37.2
366,993
28.3
318,060
29.9
304,808
27.0
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2019 ANNUAL REPORT
TENEMENT DETAILS
GEOPACIFIC RESOURCES LIMITED
and Controlled Entities
TENEMENT DETAILS
Current interest in tenements held by Geopacific and its subsidiaries, as at 26 March 2020 are listed below:
Country
Location
Tenement
Interest
Cambodia
Papua New Guinea
Papua New Guinea
Papua New Guinea
Papua New Guinea
Papua New Guinea
Papua New Guinea
Papua New Guinea
Papua New Guinea
Papua New Guinea
Papua New Guinea
Preah Vihear Provence Kou Sa Project
Woodlark Island
Woodlark Island
Woodlark Island
Woodlark Island
Woodlark Island
Woodlark Island
Woodlark Island
Woodlark Island
Woodlark Island
Woodlark Island
EL 1172
EL 1279
EL 1465
LMP 89
LMP 90
LMP 91
LMP 92
LMP 93
ME 85
ML 508
85%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
106
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2019 ANNUAL REPORT