Greatland Gold plc
Company number: 5625107
Greatland Gold plc
Report & Financial Statements
for the year ended 30 June 2020
Greatland Gold plc
Company number: 5625107
Contents
Company information
Chairman’s statement
Board of directors
Strategic report
Directors’ report
Statement of directors’ responsibilities
Corporate governance statement
Remuneration committee report
Audit and Risk committee report
Independent auditor’s report
Group statement of comprehensive income
Group balance sheet
Group statement of changes in equity
Company balance sheet
Company statement of changes in equity
Group cash flow statement
Company cash flow statement
Notes to financial statements
Page
3
4-6
7
8-14
15-19
20
21-27
28
29
30-33
34
35
36-37
38
39
40
41
42-64
2
Greatland Gold plc
Company number: 5625107
Company Information
Directors
Alex Borrelli – Non-Executive Chairman
Gervaise Heddle – Chief Executive Officer
Callum Baxter – Chief Technical Officer
Clive Latcham – Non-Executive Director
all of
33 St. James’s Square
London SW1Y 4JS
Secretary
Stephen F Ronaldson
Registered Office
Salisbury House, London Wall
London EC2M 5PS
Website
www.greatlandgold.com
Nominated Adviser
Solicitors
Auditors
Joint Broker
Joint Broker
Joint Broker
Bankers
SPARK Advisory Partners Limited
5 St. John’s Lane
London EC1M 4BH
Druces LLP
Salisbury House, London Wall
London EC2M 5PS
PKF Littlejohn LLP
15 Westferry Circus
London E14 4HD
Berenberg
60 Threadneedle Street
London EC2R 8HP
Hannam & Partners
2 Park Street
London W1K 2HX
SI Capital Limited
46 Bridge Street
Godalming, Surrey GU7 1HL
Coutts & Co
440 Strand
London WC2R 0QS
Media and Investor Relations Luther Pendragon
Registrars
48 Gracechurch Street
London EC3V 0EJ
Share Registrars Limited
The Courtyard
17 West Street
Farnham
Surrey GU9 7DR
Registered number
5625107
3
Greatland Gold plc
Company number: 5625107
Chairman’s Statement
I am pleased to report on the Company’s audited results for the year ended 30 June 2020.
It has been a transformational year for Greatland Gold plc (“Greatland” or the “Group”). The
Havieron gold-copper deposit, purchased as an early stage exploration project in September 2016, has
been a game changer for the Company and, as we look to the year ahead, we remain excited by the
exploration potential at both Havieron and our other key prospects in the Paterson region.
Greatland completed two successful exploration campaigns at Havieron in 2018, which were
instrumental in securing a US$65 million Farm-In Agreement with Newcrest Operations Limited
(“Newcrest”), a wholly-owned subsidiary of Newcrest Mining Limited (ASX:NCM). Since Newcrest
commenced its exploration programme at Havieron in May 2019, it has completed more than 100,000
meters of drilling at the project.
A series of excellent drill results to date from Havieron have continued to extend the footprint of
mineralisation, and an initial resource is on track to be delivered before the end of calendar 2020.
Subsequent to the year end, a Mining Lease was granted for the Havieron deposit and work continues
at a rapid pace to support the potential commencement of early works activities at Havieron in late
2020 or early 2021.
Our success at Havieron has not dimmed our appetite for discoveries and we are excited by our other
exploration prospects, particularly in the Paterson region where Greatland has an entrenched position
and is leading a wave of new investment and exploration in the region. Key developments for the year
across Greatland’s portfolio of exploration projects are detailed in the Strategic Report, but I would
like to briefly note some further highlights.
Havieron and the Paterson region
Excellent progress was made at Havieron over the past 12 months, with Newcrest completing the first
two stages of the Farm-in Agreement to earn a 40% interest in the project. Stage three is currently
progressing with the exploration programme focused on both infill drilling to deliver an initial resource
before the end of this calendar year and step out drilling to define the extent of the mineralised system.
During the year, Newcrest reported a series of excellent exploration results from the drilling campaign
at Havieron, with multiple exceptional results from infill drilling, including 109m @ 6.3g/t Au, 0.71%
Cu (HAD059). By the end of the financial year, drill results from Havieron had demonstrated improved
continuity in the high-grade crescent sulphide zone and extended the strike length of mineralisation to
550 metres in the upper 200 metres of that zone.
Subsequent to the year end, Newcrest has reported three further sets of excellent drilling results which
have highlighted the potential for a broad bulk tonnage target at Havieron in the new Northern Breccia
zone. The latest set of drilling results included the best intercept to date at Havieron (120.7m @ 9.3g/t
Au and 0.18% Cu from 1349.3m - HAD065W2) and identified a potential new target area, the Eastern
Breccia. Additionally, infill drilling results since year end have continued to demonstrate geological and
grade continuity within the high-grade crescent sulphide zone and surrounding breccia in the south
east.
An initial resource for Havieron is expected to be delivered in calendar Q4 2020. Results from Havieron
continue to support the ongoing investigation of both high-grade selective and bulk mining methods.
Environmental and baseline studies are progressing to support the potential commencement of a
decline at Havieron by end of calendar year 2020 or early 2021, subject to market and operating
conditions and receipt of all necessary permits, consents and approvals. Newcrest continues to
investigate the potential to achieve commercial production within two to three years from
commencement of decline.
In addition to exploration activities, progress has been made towards securing the necessary
permissions for the commencement of early works activities at Havieron. Notably, in September 2020,
the Western Australian Department of Mines, Industry Regulation and Safety ("DMIRS") granted
Mining Lease application 45/1287 for the Havieron gold-copper deposit. Subsequently, a Mining
Proposal for early works activities, including the construction of a boxcut and decline at the Havieron
deposit, has been lodged with DMIRS.
4
Greatland Gold plc
Company number: 5625107
Chairman’s Statement, continued
The intention remains, subject to a positive Feasibility Study outcome, for the ore from Havieron to
be toll processed at Newcrest’s Telfer Gold Mine, 45 kilometres to the west of Havieron. There is a
clear advantage here for both parties as it lowers upfront capital costs, reduces time to production, and
potentially delivers a significantly higher net present value for the project.
In addition to Havieron, Greatland holds an impressive footprint in the highly prospective Paterson
region, including several other prospects that display similar geophysical characteristics to the Havieron
gold-copper deposit. Our current exploration campaign in the Paterson region, which commenced in
late-August 2020, is focused on drill testing high-priority targets within the Scallywag prospect area
including Kraken, Blackbeard and London.
Corporate
Greatland continues to invest in its team and infrastructure to ensure we have the right people and
processes in place, befitting of the significant leap forward that our company has taken and to match
our ambitious plans as we look into the future.
In July 2020, we appointed Berenberg and Hannam & Partners as Joint Corporate Brokers and
Financial Advisers as we continue to expand our institutional investor base in line with the
development of the Company.
The Company is well capitalised to accelerate its exploration plans in the Paterson region and across
its other projects, supported by both a successful fundraise in August 2019 (£3,958,672 net of costs)
as well as the exercise of warrants and options through the year (an additional £3,802,724). The Group’s
cash deposits stood at £6,022,745 at 30 June 2020.
Greatland is committed to safe, responsible and sustainable exploration and we continue to focus on
improving health and safety training and processes, and on further strengthening our relationships with
the indigenous communities in the areas that we operate.
COVID-19
On 11 March 2020, the World Health Organisation declared the COVID-19 Coronavirus outbreak to
be a pandemic in recognition of its rapid spread across the globe, with over 200 countries now affected.
Many governments are taking increasingly stringent steps to help contain or delay the spread of the
virus and as a result there is a significant increase in economic uncertainty.
For the Group’s 30 June 2020 financial statements, the Directors have taken into consideration the
Coronavirus outbreak and the related impacts concluded there to be no material impact on the
recognition and measurement of assets and liabilities. Due to the uncertainty of the outcome of current
events, the Group will continue to assess the impact on the Group’s financial position, results of
operations or cash flows.
Due to the COVID-19 pandemic, the business experienced some minor delays to exploration activities
in some jurisdictions during the year. All projects have followed government requirements and health
guidelines while focusing on protecting the well-being of local and indigenous communities. The
Company is committed to a safe working environment and has implemented monitoring and
preventative measures to mitigate the impact of COVID-19 on its workforce and stakeholders to
develop a COVID safe environment that adheres to health and Government advice and restrictions.
Fortunately, Greatland benefits from the remote location of its key operations in Western Australia,
where the total number of cases recorded across the entire state is less than 800 in total and daily new
cases are in the single figures at present. At Havieron, Newcrest have implemented and maintained
measures to reduce and mitigate the risk of the COVID-19 pandemic to its project workforce and key
stakeholders, and operations have continued without interruption.
Nevertheless, I would like to reiterate that the health and safety of our staff, partners and stakeholders
has always been of paramount importance to the board and it is even more so in our focus now.
5
Greatland Gold plc
Company number: 5625107
Chairman’s Statement, continued
Looking ahead
Greatland today is a vastly different looking company to what it was a year ago. There is still much
work to do, but at Havieron tremendous progress has been made in advancing a potential world class
discovery. In addition to our cornerstone project at Havieron, we have several other excellent
prospects, including an enviable footprint in the Paterson region, arguably one of the most attractive
frontiers in the world for the discovery of tier-one, gold-copper deposits.
On a macro level, strong tailwinds appear to be supporting gold prices, with the increasing uncertainty
in global markets due to COVID-19 driving unprecedented fiscal and monetary stimulus. We also
believe the gold price will be further supported by supply challenges, as major new gold discoveries in
safe jurisdictions become less frequent and reserves at larger deposits are depleted.
The massive strides we have taken over the past year are a credit to our management team and their
strategy. With a proven expertise and track record of identifying underdeveloped opportunities in the
region, we are in an excellent position to maximise shareholder value.
I would like to end by thanking my fellow Board members, the management team and our staff, for
their hard work and commitment to the Company over the past year. Finally, I would like to thank all
our shareholders for their support and feedback, and we are delighted that you have been able to share
in the Company’s success. We promise we are working tirelessly to ensure the following year will be as
successful as this last one has been.
Alex Borrelli
Chairman
5 November 2020
6
Greatland Gold plc
Company number: 5625107
Board of Directors
Alex Borrelli
FCA, Non-executive Chairman
Alex is Chairman of Greatland Gold plc. Alex qualified as a Chartered Accountant and has many years’
experience in investment banking encompassing flotations, takeovers, and mergers and acquisitions
for private and quoted companies. Alex is also Chairman of Xpediator plc, an AIM-listed company.
Gervaise Heddle
BEc(Hons), BA(Juris), CFA, Chief Executive Officer
Gervaise is Chief Executive Officer of Greatland Gold plc, and a former Non-Executive Director of
MetalNRG plc and Thor Mining plc. Previously, Gervaise was a Division Director of Macquarie Bank
and a Fund Manager at Merrill Lynch Investment Managers. Gervaise is a CFA charterholder and has
extensive financial market experience. Gervaise is based in Australia.
Callum Baxter
MSc (Ore Deposit Geology), MAIG, MAusIMM, Chief Technical Officer
Callum is Chief Technical Officer of Greatland Gold plc and Chairman and CEO of Starvest plc.
Callum is a geologist with over twenty years’ global multi-commodity experience and is a member of
the Australian Institute of Geoscientists and the Australasian Institute of Mining and Metallurgy.
Callum has considerable experience in the natural resources sector as a geologist with junior, mid-tier
and major mining companies, primarily specialising in early stage exploration. Callum is based in
Australia.
Clive Latcham
BE (Hons), MSc (Mineral Economics), Non-Executive Director
Clive is a chemical engineer and mineral economist with over thirty years’ experience in senior roles in
the mining sector. Clive joined Greatland from ERM - Environmental Resource Management, the
world’s leading sustainability consultancy group, where he is currently Senior External Advisor, and
advisor to the Chairman and Chief Executive Officer. Prior to his role at ERM, Clive worked as an
independent advisor to private equity and mining consultancy firms, and spent nine years in senior
roles with Rio Tinto plc. During his time at Rio Tinto, Clive spent four years as Copper Group Mining
Executive, where he was responsible for managing Rio Tinto’s investments in the operating businesses
of Escondida in Chile, Grasberg in Indonesia, and Phalaborwa in South Africa and for the initial
development of new projects and acquisitions, including La Granja in Peru and La Sampala in
Indonesia.
7
Greatland Gold plc
Company number: 5625107
Strategic report
Principal activities, strategy and business model
The principal activity of the Group is to explore for and develop natural resources, with a focus on
gold. The Board seeks to increase shareholder value by the systematic evaluation of its existing resource
assets, and by acquiring exploration and development projects in underexplored areas.
The Group’s strategy and business model is developed by the Chief Executive Officer and is approved
by the Board. The executive directors who report to the Board are responsible for implementing the
strategy and managing the business.
The Group’s primary strategy is to advance projects that have potential for the discovery of large
mineralised systems (typically considered to be in excess of one million ounces of gold) through the
various stages of exploration and development with a view to monetising at least one or more of those
projects, whether through an outright sale, joint venture, or spin-out via initial public offering, within
a three to five year period.
Business development and performance
The financial year ended 30 June 2020 proved to be a period of exceptional progress for the Company.
In particular, the outstanding exploration success at the Havieron Joint Venture in the Paterson region
of Western Australia (60% Greatland, 40% Newcrest) continued with infill and step out drilling
returning excellent results and expanding the known area of mineralisation.
In addition to the success at the Havieron Joint Venture, significant progress was made at a number of
the Company’s other exploration projects. Most notably, a number of high-priority targets with similar
geophysical characteristics to the Havieron deposit, were identified by the Company’s ongoing
exploration work in the Paterson region.
Further details on the progress at the Havieron Joint Venture and at the Company’s other exploration
projects is provided in the “Review of key developments by project” section below.
The Group’s financial position was further strengthened during the year by the successful raise of
£3,958,672 of new equity (net of costs) and a further £3,802,724 on the exercise of warrants and
options. The Group’s cash deposits stood at £6,022,745 at 30 June 2020 (compared to £2,755,998 at
30 June 2019). These funds will be used to accelerate exploration across key projects, particularly in
the Paterson region.
8
Greatland Gold plc
Company number: 5625107
Strategic report, continued
Review of key developments by project
Havieron Joint Venture, Western Australia (60% Greatland, 40% Newcrest)
In March 2019, Greatland entered into a Farm-in Agreement with Newcrest Operations Limited, a
wholly-owned subsidiary of Newcrest Mining Limited (ASX:NCM), to explore and develop
Greatland’s Havieron gold-copper discovery in the Paterson region of Western Australia. Newcrest
has the right to earn up to a 70% interest in a 12-block area, previously within E45/4701, that covers
the Havieron target by spending up to US$65m. Newcrest may acquire an additional 5% interest at the
end of the Farm-in period at fair market value. The Farm-in Agreement includes tolling principles
reflecting the intention of the parties that, subject to a successful exploration programme and feasibility
study, the resulting joint venture ore will be processed at Telfer, located 45km west of Havieron.
During the period, Newcrest completed Stage 2 of the Farm-in Agreement. In accordance with the
terms of the Farm-in Agreement, Newcrest has earned a 40% interest in the Havieron Project.
Newcrest is now progressing Stage 3 work programs including ongoing exploration drilling and studies
to support early development options.
In June 2020, a series of agreements were executed in relation to the Havieron project variously
between Newcrest Operations Limited, Western Desert Lands Aboriginal Corporation (Jamukurnu-
Yapalikunu), the Prescribed Body Corporate for the Martu People of the Central Western Desert
region in Western Australia (“WDLAC”), Greatland Gold plc and Greatland Pty Ltd (“GPL”).
Newcrest and WDLAC are parties to an Indigenous Land Use Agreement (“ILUA”) which relates to
the use of native title land across Newcrest’s current operations at Telfer and its activities within a 60
kilometre radius around Telfer, which includes its exploration activities at Havieron. Under these
agreements, the parties have agreed that the ILUA will apply to any future development activities of
the Joint Venture Participants (Newcrest and Greatland) at Havieron. The ILUA establishes a
comprehensive framework between WDLAC, acting on behalf of the Martu People, and the Joint
Venture Participants (Newcrest and Greatland), in regard to any future development activities at
Havieron, including mine construction and mine operation.
Subsequent to the financial year end, the Western Australian Department of Mines, Industry
Regulation and Safety ("DMIRS") granted Mining Lease application 45/1287 for the Havieron gold-
copper deposit. The Mining Lease covers the 12 block area that is subject to the Farm-in Agreement
between Greatland and Newcrest dated 12 March 2019. Subsequently, a Mining Proposal for early
works activities, including the construction of a boxcut and decline at the Havieron deposit, has been
lodged with DMIRS.
During the year, Newcrest reported a series of excellent exploration results from the drilling campaign
at Havieron, with multiple exceptional results from infill drilling, including 109m @ 6.3g/t Au, 0.71%
Cu (HAD059). By the end of the financial year, drill results from Havieron had demonstrated improved
continuity in the high-grade crescent sulphide zone and extended the strike length of mineralisation to
550 metres in the upper 200 metres of that zone.
Subsequent to the year end, Newcrest has reported three further sets of excellent drilling results which
have highlighted the potential for a broad bulk tonnage target at Havieron in the new Northern Breccia
zone. The latest set of drilling results included the best intercept to date at Havieron (120.7m @ 9.3g/t
Au and 0.18% Cu from 1349.3m - HAD065W2) and identified a potential new target area, the Eastern
Breccia. Additionally, infill drilling results since year end have continued to demonstrate geological and
grade continuity within the high-grade crescent sulphide zone and surrounding breccia in the south-
east.
An initial resource for Havieron is expected to be delivered in calendar Q4 2020. Results from Havieron
continue to support the ongoing investigation of both high-grade selective and bulk mining methods.
Environmental and baseline studies are progressing to support the potential commencement of a
decline at Havieron by end of calendar year 2020 or early 2021, subject to market and operating
conditions and receipt of all necessary permits, consents and approvals. Newcrest continues to
investigate the potential to achieve commercial production within two to three years from
commencement of decline.
9
Greatland Gold plc
Company number: 5625107
Strategic report, continued
Paterson project, Western Australia (100% owned)
The Paterson project, excluding the Havieron Joint Venture, comprises three granted exploration
licences (the Havieron, Paterson Range East and Black Hills licences), and one licence application (the
Rudall licence application area). The three granted licences and the licence application are located in
the Paterson region of northern Western Australia and are 100% owned by Greatland. The four
licences collectively comprise approximately 450 square kilometres of ground which is considered
prospective for intrusion related gold-copper systems and Telfer style gold deposits.
In June 2020, Newcrest and Greatland entered into a series of agreements in relation to the Havieron
licence (E45/4701), including the Tenement Management and Re-Transfer Agreements, in order to
support the lodgement of a Mining Lease application for the 12 blocks, at that time within the Havieron
licence, that are subject to the Farm-in Agreement with Newcrest dated 12 March 2019. As a result, in
September 2020, Mining Lease 45/1287 was granted in respect of the 12 blocks the subject of the
Farm-in Agreement in which, at the date of the report is Greatland has a 60% legal and beneficial
interest and Newcrest a 40% interest. Greatland retains a 100% interest over the remaining 31 blocks
under the Havieron exploration licence E45/4701.
The Havieron, Paterson Range East and Black Hills licences are subject to a right of first refusal in
accordance with the Farm-in Agreement with Newcrest dated 12 March 2019. During the Farm-in and
Havieron Joint Venture periods, Newcrest have a right of first refusal over the Havieron licence.
During the Farm-in period, Newcrest have a right of first refusal over the Black Hills and Paterson
Range East licences.
During the financial year, Greatland continued to conduct systematic exploration campaigns across its
three granted Paterson licences.
Geophysical surveys, including ground gravity and induced polarization (“IP”), were conducted across
the Scallywag prospect area within the Havieron licence (over the areas of the Havieron licence not
subject to the Farm-in with Newcrest). A review of the geophysical data highlighted multiple high-
priority targets for drill testing, including Kraken, London, Blackbeard and Barbossa.
At Paterson Range East, the Company conducted aeromagnetic and ground gravity surveys which were
used for detailed modelling and target generation. The results of these activities identified multiple
high-priority targets identified, including several with similar geophysical characteristics to Havieron.
Subsequently, a mobile metal ion (“MMI”) geochemical surface soil sampling survey was also
completed, with results upgrading the Goliath target and identifying three new additional targets.
During the year, the Company also completed its first drilling campaign at the Saddle Reefs target
within the Black Hills licence. Previous field exploration work at Saddle Reefs had successfully
identified multiple gold nuggets at surface and established a strike length of high-grade gold
mineralisation at surface of up to 800 metres. Two subsequent IP surveys identified a chargeability
anomaly over 1.4 kilometres in length, part of which is spatially coincident with the surface gold
mineralisation. A drill programme was subsequently designed to test the 1.4km anomaly, which
commenced in July 2019. Initial results from the drilling programme confirmed the presence of gold
mineralisation at Black Hills with best results including 13m @ 2.01g/t Au from 67m (SRRC012). In
addition to the drilling campaign at Black Hills, a subsequent ground gravity survey conducted across
the licence area identified three additional targets including the Parlay target.
Subsequent to the financial year end, the Company commenced a drilling campaign in the Paterson,
with an initial focus on high-priority targets within the Scallywag prospect area including Kraken,
Blackbeard and London. In addition, the Company commenced an Airborne Electromagnetic
(“AEM”) survey, covering 1,033 line kilometres across the western portion of the Company’s Paterson
project.
10
Greatland Gold plc
Company number: 5625107
Strategic report, continued
Review of key developments by project, continued
Firetower project, Tasmania (100% owned)
The Firetower project is located in central north Tasmania, Australia, and covers an area of 62 square
kilometres. Historic drilling at the Firetower prospect has identified significant gold mineralisation
from surface (up to 30g/t).
During the year, the Company completed a drilling programme at the Firetower and Firetower East
prospects, which included 16 diamond drill holes for over 2,200m of drilling. At Firetower, drilling was
done on north-south traverses to test a chargeability anomaly highlighted by an Induced Polarisation
("IP”) survey conducted in 2018. Results from drilling at Firetower confirmed good continuity of
mineralisation, with best results including 54.5m @ 1.36g/t Au from surface (2019FTD001) and 13.5m
@ 2.44g/t Au from 59.5m (2019FTD011). In addition, the programme defined mineralisation over a
strike length of more than 200m, which remains open along strike to the east and west, and also
demonstrated a robust southerly dipping mineralised zone up to 50m wide, persisting to depths of
125m, which remains open at depth.
Panorama project, Western Australia (100% owned)
The Panorama project consists of three adjoining exploration licences, covering 155 square kilometres,
located in the Pilbara region of Western Australia, in an area that is considered to be highly prospective
for gold.
During the period, the Company continued field exploration at Panorama which included field
reconnaissance, surface geochemical work and airborne magnetics. The Company completed a
systematic, grid based, surface geochemical soil sampling programme at Panorama during July and
August 2019 which involved the collection of 468 samples over approximately 4.5km of strike. Results
of soil sampling confirmed the presence of gold anomalism along the main mineralised trend previously
identified by rock chips and coarse gold (nuggets).
Results from the airborne magnetic survey highlighted a NE-SW oriented anomaly, clearly identifiable
from magnetic derivative images, coincident with an anomalous gold trend identified from soil
geochemistry.
11
Greatland Gold plc
Company number: 5625107
Strategic report, continued
Review of key developments by project, continued
Ernest Giles project, Western Australia (100% owned)
The Ernest Giles project is located in central Western Australia, covering an area of approximately 850
square kilometres. The Ernest Giles project includes two granted exploration licences (Calanchini and
Peterswald Hill), and two licence applications (Westwood North and Westwood West). The eastern
Yilgarn Craton is one of the most highly mineralised areas in Western Australia and is considered
prospective for large gold deposits.
During the period, Greatland carried out comprehensive geological and geophysical interpretation and
targeting and ran historical diamond drill core through Minalyze© analysis. Following a comprehensive
review of all data for the Ernest Giles project, the Board decided that the Company should focus on
high priority targets within the project and, consequently, the Empress North (E38/3228), Empress
(E38/3183) and Ida Range (E38/8134) licences were relinquished, thereby enabling work to be
concentrated on higher priority targets within the retained project licences.
Warrentinna project, Tasmania (100% owned)
The Warrentinna project is located 60 kilometres north east of Launceston in north eastern Tasmania
and covers an area of 37 square kilometres with 15 kilometres of strike prospective for gold. During
the period, Greatland conducted a diamond drilling programme at the Derby North prospect. Drilling
intersected high-grade gold mineralisation and increased the depth extent of known mineralization in
the area. Best results included 21.7m @ 3.3g/t Au from 9.3m, including 2.2m @ 12g/t Au
(2019WTD001), and 43m @ 1.5g/t Au from 10m (2019WTD003). The Company is evaluating the
results to assess the project’s potential, referencing Orogenic-type gold occurrences in central Victoria.
Bromus project, Western Australia (100% owned)
The Bromus project is located 25 kilometres south west of Norseman in the southern Yilgarn region
of Western Australia. The Bromus project consists of two granted exploration licences, including a
new licence, Bromus North (E63/1953), which was granted in September 2019. The two licences cover
approximately 84 square kilometres of relatively under-explored greenstone and intrusive granites of
the Archean Yilgarn Block at the southern end of the Kalgoorlie-Norseman belt. During the period,
Greatland undertook a comprehensive data review, including reprocessing and remodelling of historic
data to aide field work. In addition, resampling and analysis of historic drill samples and new soil
sampling was also undertaken. Results are being interpreted to assist with future exploration targeting.
Further details regarding exploration activities during the year can be found on the Company’s website
at www.greatlandgold.com.
Main trends and factors likely to impact future business performance
The Board considers the following to be the key trends and factors that are likely to impact future
business performance:
• General commodity cycle – Commodity prices have generally improved since the low point in
early 2016, however, the current global economic uncertainty could lead to significant commodity
price volatility in the near term. The Board maintains a positive outlook for commodity prices, and
the gold price in particular.
• Exploration results – Management’s ability to successfully execute Greatland’s exploration strategy
is a key factor in the future business performance of the Company. Specific business principles
designed to maximize the Company’s chance of long-term success in this regard are highlighted in
the following section (“Principal risks and uncertainties”).
12
Greatland Gold plc
Company number: 5625107
Strategic report, continued
Principal risks and uncertainties
The management of the business and the execution of the Board’s strategy are subject to a number of
key risks and uncertainties:
• Mineral exploration - Mineral exploration is a high-risk activity and there can be no guarantee that
the Company can identify a mineral resource that can be extracted economically. In order to
minimise this risk and to maximise the Company’s chances of long-term success, we are committed
to the following strategic business principles:
○ The board regularly reviews our exploration and development programmes and allocates
capital in a manner that it believes will maximise risk-adjusted return on capital;
○ We focus our activities on jurisdictions that we believe represent low political and operational
risk. Moreover, we strongly prefer to operate in jurisdictions where our team has considerable
on the ground experience. At the present time, all of the Company’s projects are in Australia,
a country with established mining codes, stable government, skilled labour force, excellent
infrastructure, and a well-established mining industry;
○ We apply advanced exploration techniques to areas and regions that we believe are relatively
under-explored historically;
○ Exploration work is conducted on a systematic basis. More specifically, exploration work is
carried out in a phased, results-based fashion and leverages a wide range of exploration
methods including modern geochemical and geophysical techniques and various drilling
methods.
• Commodity price risk – The principal commodities that are the focus of our exploration and
development efforts (precious metals and base metals) are subject to highly cyclical patterns in
global demand and supply, and consequently, the price of those commodities is highly volatile.
• Recruiting and retaining highly skilled directors and employees – the Company’s ability to execute
its strategy is highly dependent on the skills and abilities of its people. We undertake ongoing
initiatives to foster good staff engagement and ensure that remuneration packages are competitive
in the market.
• Occupational health and safety – every Director and employee of the Company is committed to
promoting and maintaining a safe workplace environment, including adopting COVID safe work
practices. The Company regularly reviews occupational health and safety policies and compliance
with those policies. The Company also engages with external occupational health and safety expert
consultants to ensure that policies and procedures are appropriate as the Company expands its
activity levels.
• COVID-19 - The emergence of the COVID-19 Coronavirus pandemic has caused a severe adverse
effect on the business environment on a global scale. The Group may be affected by disruptions
to its operations, particularly for the foreseeable future in light of government responses to the
spread of COVID-19 or other potential pandemics. The Board is aware of the various risks that
the pandemic presents that include but are not limited to financial, operational, staff and
community health and safety, logistical challenges and government regulation. At present the
Group believes that there should be no significant material disruption to its operations in the near
term, but the Board continues to monitor these risks and the Group’s business continuity plans.
• Havieron Joint Venture - The potential future development of a mine at the Havieron Joint
Venture depends upon a number of factors, including but not limited to, results from geotechnical,
metallurgical and environmental studies, the grant of necessary permits and other regulatory
approvals and the ability to secure finance.
13
Greatland Gold plc
Company number: 5625107
Strategic report, continued
Directors’ statement under section 172 (1) of the Companies Act 2006
Section 172 (1) of the Companies Act obliges the Directors to promote the success of the Company
for the benefit of the Company’s members as a whole. This section specifies that the Directors must
act in good faith when promoting the success of the Company and in doing so have regard (amongst
other things) to:
1.
2.
3.
4.
5.
6.
the likely consequences of any decision in the long term,
the interests of the Company’s employees,
the need to foster the Company’s business relationship with suppliers, customers and others,
the impact of the Company’s operations on the community and environment,
the desirability of the Company maintaining a reputation for high standards of business
conduct, and
the need to act fairly as between members of the Company.
The application of the Section 172 (1) requirements can be demonstrated in relation to some of the
key decisions made during the financial year, including:
• raising of new capital to ensure the Group has adequate resources to continue in operational
existence for the foreseeable future.
• executing a series of agreements to facilitate the mining lease application and further future
development activities at Havieron.
• committed to major exploration campaigns and approved associated budgets that enabled the
Company to conduct exploration across its projects.
The Directors believe they have acted in the way they consider most likely to promote the success of
the Company for the benefit of its members as a whole, as required by Section 172 (1) of the Companies
Act 2006.
Greatland has chosen to adhere to the Quoted Company Alliance’s (“QCA”) Corporate Governance
Code for Small and Mid-Size Quoted Companies (revised in April 2018 to meet the new requirements
of AIM Rule 26). At this time, the Board believes that it is compliant with all ten Principles of the QCA
Code. More information can be found on pages 21-27.
By order of the Board
Gervaise Heddle
Chief Executive Officer
5 November 2020
14
Greatland Gold plc
Company number: 5625107
Directors’ report
The Directors present their fourteenth annual report on the affairs of the Group and parent Company,
together with the Group financial statements for the year ended 30 June 2020.
Fundraising
The Group raised £7,761,396 net of costs during the year (2019: £2,983,400).
Results and dividends
The Group’s results are described in the Group statement of comprehensive income on page 34. The
audited financial statements for the year ended 30 June 2020 are set out on pages 34 to 64.
The Group has incurred a loss for the year of £5,144,995 (2019: £3,264,307).
For the financial year ended 30 June 2020, no exploration costs were capitalised with all exploration
expenditure recognised through the income statement. In the opinion of the Directors, Greatland
adopted a conservative approach in regard to the accounting treatment of costs associated with
exploration, specifically as it relates to the capitalisation of exploration costs. Costs related with an
exploration activity will only be capitalised if, in management’s opinion, the results from that activity
led to a material increase in the market value of the exploration asset. For the financial year ended 30
June 2020, there was no increase to the carrying asset value of exploration assets with a small
impairment charge recognised following the Directors assessment of this carrying value. Additionally,
a new accounting standard IFRS16 was adopted during the year which recognised a right of use asset
on the balance sheet with associated amortisation costs to the income statement.
The Directors do not recommend the payment of a dividend.
Risk Management
The Board considers risk assessment to be important in achieving its strategic objectives. There is a
process of evaluation of performance targets through regular reviews by senior management to
forecasts. Project milestones and timelines are regularly reviewed.
General and economic risks
• Contractions in the world’s major economies or increases in the rate of inflation resulting from
international conditions;
• movements in the equity and share markets in the United Kingdom and throughout the world;
• weakness in global equity and share markets, in particular, in the United Kingdom, and adverse
changes in market sentiment towards the resource industry;
•
•
•
•
currency exchange rate fluctuations and, in particular, the relative prices of the Australian Dollar,
and the UK Pound;
exposure to interest rate fluctuations;
adverse changes in factors affecting the success of exploration and development operations, such
as increases in expenses, changes in government policy and further regulation of the industry;
unforeseen major failure, breakdowns or repairs required to key items of plant and equipment
resulting in significant delays, notwithstanding regular programmes of repair, maintenance and
upkeep; and variations in grades and unforeseen adverse geological factors or prolonged weather
conditions; and
impact of COVID-19 Coronavirus pandemic and government restrictions on the global economic
environment
15
Greatland Gold plc
Company number: 5625107
Directors’ report, continued
Funding risk
The Group or the companies in which it has invested may not be able to raise, either by debt or further
equity, sufficient funds to enable completion of planned exploration, investment and/or development
projects.
Commodity risk
Commodities are subject to high levels of volatility in price and demand. The price of commodities
depends on a wide range of factors, most of which are outside the control of the Group. Mining,
processing and transportation costs also depend on many factors, including commodity prices, capital
and operating costs in relation to any operational site.
Exploration and development risks
• Exploration and development activity is subject to numerous risks, including failure to achieve
estimated mineral resource, recovery and production rates and capital and operating costs.
• Success in identifying economically recoverable reserves can never be guaranteed. The Group also
cannot guarantee that the companies in which it has invested will be able to obtain the necessary
permits and approvals required for development of their projects.
• Some of the states within Australia have native title laws which could affect exploration and
development activities. The companies in which the Group has an interest may be required to
undertake clean-up programmes on any contamination from their operations or to participate in
site rehabilitation programmes which may vary from state to state. The Group’s policy is to follow
all applicable laws and regulations and the Group is not currently aware of any material issues in
this regard.
• Timely approval of mining permits and operating plans through the respective regulatory agencies
cannot be guaranteed.
• Availability of skilled workers is an ongoing challenge.
• Geology is always a potential risk in mining activities.
Havieron Joint Venture
The potential future development of a mine at the Havieron Joint Venture depends upon a number of
factors, including but not limited to, results from geotechnical, metallurgical and environmental studies,
the grant of necessary permits and other regulatory approvals and the ability to secure finance.
Market risk
The Group has an overseas subsidiary in Australia whose expenses are denominated in Australian
Dollars. Market price risk is inherent in the Group’s activities and is accepted as such.
The ability of the Group (and the companies in which it invests) to continue to secure sufficient and
profitable sales contracts to support its operations is a key business risk.
Key performance indicators
Given the straightforward nature of the Group’s activities, the Company’s directors are of the opinion
that analysis using key performance indicators is not necessary for an understanding of the
development, performance or position of the business at the present time.
Directors
The Directors who served during the year are as follows:
Callum Baxter
Alex Borrelli
Gervaise Heddle
Clive Latcham
16
Greatland Gold plc
Company number: 5625107
Directors’ report, continued
Share capital
Information relating to shares issued during the period is given in Note 16 to the accounts.
Charitable and political donations
During the period there were no charitable or political contributions.
Payment of suppliers
The Group’s policy is to settle terms of payment with suppliers when agreeing terms of business, to
ensure that suppliers are aware of the terms of payment and to abide by them. It is usual for suppliers
to be paid within 30 days of receipt of invoice. At 30 June 2020 the Group’s creditors were equivalent
to approximately 30 days’ costs.
Substantial shareholdings
On 30 June 2020 and 30 October 2020, the following were registered as being interested in 3% or more
of the Company’s ordinary share capital:
30 October 2020
30 June 2020
Ordinary
shares of
£0.001 each
Percentage of
issued share
capital
Ordinary
shares of
£0.001 each
Percentage of
issued share
capital
1,034,283,508
26.70%
998,615,269
26.56%
464,351,547
11.99%
461,733,488
12.28%
Hargreaves Lansdown (Nominees)
Limited
Interactive Investor Services
Nominees Limited
HSDL Nominees Limited
364,407,122
9.41%
380,993,449
10.13%
JIM Nominees Limited
222,251,765
5.74%
239,514,890
Barclays Direct Investing Nominees
Limited
216,701,219
5.60%
217,749,450
Vidacos Nominees Limited
210,336,967
5.43%
238,959,249
Lawshire Nominees Limited
184,006,860
4.75%
179,514,436
Share Nominess Limited
163,375,301
4.22%
169,854,938
State Street Nominees Limited
130,594,150
3.37%
20,674,435
Rock (Nominees) Limited
128,013,677
3.31%
118,297,940
6.37%
5.79%
6.35%
4.77%
4.52%
0.55%
3.15%
Auditors
The Directors will place a resolution before the annual general meeting to reappoint PKF Littlejohn
LLP as auditors for the coming year.
PKF Littlejohn LLP has signified its willingness to continue in office as auditor.
17
Greatland Gold plc
Company number: 5625107
Directors’ report, continued
Directors’ remuneration
The remuneration of the directors paid during the year was fixed by the remuneration committee
consisting of Alex Borrelli and Clive Latcham. This has been achieved acknowledging the need to
maximise the effectiveness of the Company’s limited resources during the year.
As announced by the Company on 26 September 2019, 39,000,000 share options were issued to three
directors; Gervaise Heddle Chief Executive Officer, Callum Baxter Chief Technical Officer and Clive
Latcham Non-Executive Director. As set out in Note 17, under the Company’s employee share option
plan there were 204.5 million unexercised options in issue (2019: 213.5 million).
During the year the Directors were awarded performance bonuses totalling £460,242 (see Note 8)
(2019: £329,472). This amount represents an award to reflect the outstanding progress made by the
Company during the year, most notably excellent exploration results which, in the Board’s view, have
significantly increased the value of the Company’s interest in the Havieron Joint Venture in the
Paterson region.
Events after the reporting period
There are no significant post balance sheet events to disclose for the year ended 30 June 2020, other
than those set out in Note 21.
Corporate Governance
A corporate governance statement follows on page 21.
Control Procedures
The Board has approved financial budgets and cash forecasts; in addition, it has implemented
procedures to ensure compliance with accounting standards and effective reporting.
Environmental Responsibility
The Company is aware of the potential impact that its subsidiary companies may have on the
environment. The Company ensures that it and its subsidiaries at a minimum comply with the local
regulatory requirements and the revised Equator Principles with regard to the environment.
Cultural awareness
The Company continues to engage with the traditional land owners to understand and respect cultural
heritage as a necessary part in obtaining clearances to access projects across its Australian operations
and operate within the appropriate protocols.
COVID-19
Due to the COVID-19 pandemic, the business experienced some minor delays to exploration activities
in some jurisdictions during the year. All projects have followed government requirements and health
guidelines while focusing on protecting the well-being of local and indigenous communities. The
Company is committed to a safe working environment and has implemented monitoring and
preventative measures to mitigate the impact of COVID-19 on its workforce and stakeholders to
develop a COVID safe environment that adheres to health and Government advice and restrictions.
18
Greatland Gold plc
Company number: 5625107
Directors’ report, continued
Health and Safety
The Group’s aim is to achieve and maintain a high standard of workplace safety. In order to achieve
this objective, the Group provides training and support to employees and sets demanding standards
for workplace safety.
Employment Policies
The Group is committed to promoting policies which ensure that high calibre employees are attracted,
retained and motivated, to ensure the ongoing success for the business. Employees and those who seek
to work within the Group are treated equally regardless of gender, marital status, creed, colour, race or
ethnic origin.
Going Concern
The consolidated entity has incurred a loss before tax of £5,144,995 for the year ended 30 June 2020
and had a net cash outflow of £4,671,524 from operating and investing activities. At that date there
were net current assets of £5,169,062. The loss resulted almost entirely from exploration costs and
associated administrative related costs.
The Directors are confident in the Company’s ability to raise new finance from stock markets if this is
required during 2021 and the Group has demonstrated a consistent ability to do so.
The Group’s cash flow forecast for the period ending 31 December 2021 highlights adequate funding
at current levels of projected expenditure to last well into 2022. The Board of Directors is confident
that sufficient funding is in place to meet all its operational and exploration commitments over the
next twelve months and to remain cash positive for the whole period.
Given the Group’s current positive cash position and its ability to raise new capital, the Directors have
a reasonable expectation that the Group has adequate resources to continue in operational existence
for the foreseeable future. For these reasons, they continue to adopt the going concern basis in
preparing the annual report and accounts.
At present the Group believes that there should be no significant material disruption to its operations
from COVID-19 in the near term, but the Board continues to monitor these risks and the Group’s
business continuity plans.
Having prepared forecasts based on current resources, assessing methods of obtaining additional
finance and assessing the possible impact of COVID-19, the Directors believe the Group has sufficient
resources to meet its obligations for a period of 12 months from the date of approval of these financial
statements. Taking these matters into consideration, the Directors continue to adopt the going concern
basis of accounting in the preparation of the financial statements. The financial statements do not
include the adjustments that would be required should the going concern basis of preparation no longer
be appropriate.
By order of the Board
Gervaise Heddle
Chief Executive Officer
5 November 2020
19
Greatland Gold plc
Company number: 5625107
Statement of directors' responsibilities
Directors' responsibilities for the financial statements
The Directors are responsible for preparing the Directors’ Report and the financial statements in
accordance with applicable law and regulations.
Company law in the United Kingdom requires the directors to prepare Group and Company financial
statements for each financial year which give a true and fair view of the state of affairs of the Company
and the Group and of the profit or loss of the Group for that period. In addition, the AIM rules of
the London Stock Exchange require that the Group financial statements be prepared in accordance
with International Financial Reporting Standards (“IFRS”) as adopted by the European Union (“EU”);
the Company financial statements are prepared on the same basis.
In preparing the Group and Company financial statements, the directors are required to:
•
select suitable accounting policies and then apply them consistently;
• make judgements and estimates that are reasonable and prudent;
•
state whether applicable accounting standards have been followed, subject to any material
departures disclosed and explained in the financial statements;
• prepare the financial statements on the going concern basis unless it is inappropriate to
presume that the group and company will continue in business.
So far as each director is aware, there is no relevant audit information of which the Company’s auditors
are unaware, and the directors have taken all the steps that they ought to have taken as directors in
order to make themselves aware of any relevant audit information and to establish that the Company’s
auditors are aware of that information.
The directors are responsible for keeping adequate accounting records that are sufficient to show and
explain the Company’s transactions and disclose with reasonable accuracy at any time the financial
position of the Group and Company and enable them to ensure that the financial statements comply
with the Companies Act 2006. They are also responsible for safeguarding the assets of the group and
company and for taking reasonable steps for the prevention and detection of fraud and other
irregularities. They are also responsible for ensuring that the annual report includes information
required by the AIM market of the London Stock Exchange.
The maintenance and integrity of the Company’s website is the responsibility of the directors: the work
carried out by the auditors does not involve consideration of these matters and, accordingly, the
auditors accept no responsibility for any changes that may have occurred to the financial statements
since they were initially presented on the website.
Legislation in the United Kingdom governing the preparation and dissemination of the financial
statements may differ from legislation in other jurisdictions.
20
Greatland Gold plc
Company number: 5625107
Corporate Governance Statement
All members of the board of Greatland Gold plc are committed to the principles of good corporate governance.
We believe strongly in the value and importance of strong corporate governance and in our accountability to all
of Greatland’s stakeholders, including shareholders, employees, contractors and suppliers and native title
communities. We recognise the importance of promoting and maintaining a strong occupational health and safety
culture and minimising the impact of our activities on local communities and the environment.
Changes to the AIM rules on 30 March 2018 required AIM companies to apply a recognised corporate
governance code from 28 September 2018. Greatland has chosen to adhere to the Quoted Company Alliance’s
(“QCA”) Corporate Governance Code for Small and Mid-Size Quoted Companies (revised in April 2018 to meet
the new requirements of AIM Rule 26).
The QCA Code is constructed around ten broad principles and a set of disclosures. The QCA has stated what it
considers to be appropriate arrangements for growing companies and asks companies to provide an explanation
about how they are meeting the principles through the prescribed disclosures. We have considered how we apply
each principle to the extent that the board judges these to be appropriate in the circumstances, and below we
provide an explanation of the approach taken in relation to each.
At this time, the board believes that it is compliant with all ten Principles of the QCA Code.
The following paragraphs set out Greatland Gold plc’s compliance with the 10 principles of the QCA
Code.
Principle 1: Establish a strategy and business model which promotes long-term value for shareholders
The principal activity of the Company is to explore for and develop natural resources, with a focus on gold. The
Board seeks to increase shareholder value by the systematic evaluation of its existing resource assets, and by
acquiring exploration and development projects in underexplored areas.
The Company’s strategy and business model is developed by the CEO and is approved by the Board. The
Executive Directors who report to the Board are responsible for implementing the strategy and managing the
business.
The Company’s primary strategy is to advance projects that have potential for the discovery of large mineralised
systems (typically considered to be in excess of one million ounces of gold) through the various stages of
exploration and development with a view to monetising at least one or more of those projects, whether through
an outright sale, joint venture, or spin-out via initial public offering, within a three to five year period.
The key challenges we face include:
• Mineral exploration - Mineral exploration is a high-risk activity and there can be no guarantee that the
Company can identify a mineral resource that can be extracted economically. In order to minimise this risk
and to maximise the Company’s chances of long-term success, we are committed to the following strategic
business principles:
○ The board regularly reviews our exploration and development programmes and allocates capital in a
manner that it believes will maximise risk-adjusted return on capital;
○ We focus our activities on jurisdictions that we believe represent low political and operational risk.
Moreover, we strongly prefer to operate in jurisdictions where our team has considerable on the ground
experience. At the present time, all of the Company’s projects are in Australia, a country with established
mining codes, stable government, skilled labour force, excellent infrastructure, and a well established
mining industry;
○ We apply advanced exploration techniques to areas and regions that we believe are relatively under-
explored historically;
○ Exploration work is conducted on a systematic basis. More specifically, exploration work is carried out
in a phased, results-based fashion and leverages a wide range of exploration methods including modern
geochemical and geophysical techniques and various drilling methods.
○ Commodity price risk – The principal commodities that are the focus of our exploration and
development efforts (precious metals and base metals) are subject to highly cyclical patterns in global
demand and supply, and consequently, the price of those commodities is highly volatile.
○ Recruiting and retaining highly skilled directors and employees – the Company’s ability to execute its
strategy is highly dependent on the skills and abilities of its people. We undertake ongoing initiatives to
foster good staff engagement and ensure that remuneration packages are competitive in the market.
21
Greatland Gold plc
Company number: 5625107
Corporate Governance Statement, continued
o Occupational health and safety – every Director and employee of the Company is committed to
promoting and maintaining a safe workplace environment. The Company regularly reviews occupational
health and safety policies and compliance with those policies. The Company also engages with external
occupational health and safety expert consultants to ensure that policies and procedures are appropriate
as the Company expands its activity levels.
o COVID-19 – the impact of the COVID-19 pandemic has affected many aspects of society and has
significantly changed the global economic environment. The challenges presented by COVID-19
remain ongoing. The Company is committed to a safe working environment and has implemented
monitoring and preventative measures to mitigate the impact of COVID-19 on its workforce and
stakeholders.
Principle 2: Seek to understand and meet shareholder needs and expectations
We have made significant efforts to ensure regular and effective engagement with our broad base of shareholders.
In addition to our Annual General Meeting, which is one of our primary forums to present to and meet with
investors, we engage in a wide range of activities designed to ensure that investors are regularly updated on the
progress of the Company and we attend and host investor events that provide investors with the opportunity to
provide us with feedback and suggestions.
Responsibility for investor relations rests with the CEO, supported by the other Directors of the Company.
During the last 12 months, the following activities were conducted in order to engage with shareholders and to
ensure that the members of the Board maintained and further developed a strong understanding of the needs
and expectations of shareholders:
Description of
Activity
Frequency
Participants
Comments
AGM
Annually
All Directors
CEO interviews
Monthly
CEO
Quarterly
CEO, CTO
Investor
Presentations
Investor Shows
and Industry
Conferences
CEO conducts regular interviews
with Proactive Investors, BRR Media,
and Share Talk
Company presents at various investor
presentation forums and host virtual
investor events and Company
updates
Bi-Annually
CEO, CTO,
Chairman
The Company attends and presents at
various investor shows
The Company is committed to communicating openly with its shareholders to ensure that its strategy and
performance are clearly understood. All Company announcements and the Company’s most recent investor
presentation are available to shareholders, investors and the public on our website.
Private shareholders: The AGM is the principal forum for dialogue with private shareholders, and we encourage
all shareholders to attend this year via video conference and participate. Last year, the AGM was well attended
with approximately thirty shareholders present at the meeting. The Notice of Meeting is sent to shareholders at
least 21 days before the meeting. This year, due to COVID-19 restrictions the AGM will be held virtually with
two members of the board and the committees in attendance at the AGM address and are available to answer
questions raised by shareholders over video conference. Shareholders vote on each resolution, and voting can
also be counted by way of a poll. For each resolution we announce the number of votes received for, against and
withheld. The Company also maintains a dedicated email address which investors can use to contact the Company
which is prominently displayed on its website together with the Company’s address and phone number.
Institutional shareholders: The directors actively seek to build a mutual understanding of the objectives of
institutional shareholders. We communicate with institutional investors frequently through a combination of
formal meetings, participation at investor conferences, virtual meetings and informal briefings with management.
22
Greatland Gold plc
Company number: 5625107
Corporate Governance Statement, continued
The majority of meetings with shareholders and potential investors are arranged by the Company’s corporate
broker.
Principle 3: Take into account wider stakeholder and social responsibilities and their implications for
long-term success
The Board recognises its responsibility under UK corporate law to promote the success of the Company for the
benefit of its members as a whole. The Board also understands that it has a responsibility towards employees,
partners, suppliers and contractors and the local communities in which it operates.
Stakeholder
Shareholders
Suppliers and Contractors
Staff and Employees
Native Title Communities
Reason for Engagement
How we engage
Shareholders are the owners of
the Company and the board’s
primary mission is to increase
shareholder value
The Company engages with
external suppliers to conduct the
majority of its field exploration
activities (including drilling and
geophysical surveys)
Recruiting and retaining highly
skilled and motivated professions
is one of the key drivers of our
success
of
The Company recognises
the
the
heritage
important
traditional owners of the land and
its ethical and legal responsibility
to work together with those
communities
As described in previous section
(Principle 2)
We work
that all
to ensure
members of staff engage in a
professional
and
respectful
manner with
suppliers. We
operate systems to ensure that
supplier invoices are processed
and paid promptly.
to
regular
In
addition
communication
between
Directors and employees, we
conduct monthly staff meetings to
promote
two-way
communication.
The Company ensures that it
regularly engages with native title
communities
routinely
engages with external expert
consultants
and
Principle 4: Embed effective risk management, considering both opportunities and threats, throughout
the organisation
The CEO maintains a risk register for the Company that identifies key risks in the areas of corporate strategy,
financial, staff, occupational health and safety, environmental and native title relations. All members of the board
are provided with a copy of the register. The register is reviewed periodically and is updated as and when
necessary.
Within the scope of the annual audit, specific financial risks are evaluated in detail, including in relation to foreign
currency, liquidity and credit.
Managing occupational health and safety risk is one of the key focuses of all directors and employees. Staff are
required to immediately report any occupational health and safety incidents and regular training is undertaken to
ensure compliance with health and safety policies.
Principle 5: Maintain the board as a well-functioning, balanced team led by the chair
The Board sets the Company’s strategy and ensures that necessary resources are in place in order for the Company
to meet its objectives. All members of the Board take collective responsibility for the performance of the
Company and all decisions are taken in the interests of the Company.
Whilst the Board has delegated the normal operational management of the Company to the Executive Directors
and other senior management, there are detailed specific matters subject to decision by the Board of Directors.
23
Greatland Gold plc
Company number: 5625107
Corporate Governance Statement, continued
These include decisions to commit to major exploration campaigns and approval of associated exploration
budgets, acquisitions and disposals, joint ventures and other investments of a capital nature. The Non-executive
Directors have a particular responsibility to challenge constructively the strategy proposed by the Executive
Directors, to scrutinise and challenge performance, and to ensure appropriate remuneration and that succession
planning arrangements are in place in relation to Executive Directors and other senior members of the
management team.
The members of the board have a collective responsibility and legal obligation to promote the interests of the
Company and are collectively responsible for defining corporate governance arrangements. Ultimate
responsibility for the quality of, and approach to, corporate governance lies with the Chair of the board.
The board consists of four directors of whom two are executive directors (Gervaise Heddle, Chief Executive
Officer and Callum Baxter, Chief Technical Officer) and two are independent non-executive directors (Alex
Borrelli, Non-Executive Chairman and Clive Latcham, Non-Executive Director) The board is supported by two
committees: Audit and Risk committee and a Remuneration committee. The board does not consider that it is
of a size at present to require a separate nominations committee, and all members of the board are involved in
the appointment of new Directors.
All Directors are required to attend 8-12 board and board committee meetings per year and to be available at
other times as required for face-to-face, virtual or tele-conference meetings with the executive team and investors.
Board meetings are led by the Chair and follow an agenda that is circulated prior to the meeting. Every board
and committee meeting are minuted and every Director is aware of the right to have any concerns minuted and
to seek independent advice at the Company’s expense where appropriate.
Principle 6: Ensure that between them the directors have the necessary up-to-date experience, skills and
capabilities
All four members of the board bring relevant experience in mining and resources, and all have many years
experience in public markets. The board believes that its blend of relevant experience, skills and personal qualities
and capabilities is sufficient to enable it to successfully execute its strategy. Directors attend seminars and other
regulatory and trade events to ensure that their knowledge remains current.
Alex Borrelli, Independent Non-Executive Chairman
Term of office: Joined as Non-Executive Director on 18 April 2016. Appointed as Non-executive Chairman on
14 August 2016; Chair of the Remuneration Committee and Chair of the Audit and Risk Committee.
Background and suitability for the role: Alex is Chairman of Greatland Gold plc. Alex qualified as a Chartered
Accountant and has many years’ experience in investment banking encompassing flotations, takeovers, and
mergers and acquisitions for private and quoted companies. Alex is also Chairman of Xpediator plc, an AIM-
listed company.
Gervaise Heddle, Chief Executive Officer, Executive Director
Term of office: Joined as Non-Executive Director on 27 May 2016. Appointed as Executive Director on 18 July
2016, Appointed as Chief Executive Officer on 19 January 2017;
Background and suitability for the role: Gervaise Heddle is Chief Executive Officer of Greatland Gold plc.
Previously, Gervaise was a Non-executive Director of Thor Mining plc, a Non-executive Director of MetalNRG
plc, a Division Director of Macquarie Bank and a Fund Manager at Merrill Lynch Investment Managers. Gervaise
is a CFA charterholder and has extensive financial markets experience.
Callum Baxter, Chief Technical Officer, Executive Director
Term of office: Co-Founding Director of the Company 16 November 2005, Appointed as Chief Technical
Officer on 19 January 2017.
Background and suitability for the role: Callum Baxter is Chief Technical Officer of Greatland Gold plc and
Chairman/CEO of investee company Starvest plc. Callum is an experienced geologist and investor with over
twenty five years exposure to capital markets and the natural resources sector specialising in early stage
exploration.
24
Greatland Gold plc
Company number: 5625107
Corporate Governance Statement, continued
Clive Latcham, Independent Non-Executive Director
Term of office: Joined as Non-Executive Director on 15 October 2018. Member of the Remuneration Committee
and Member of the Audit Committee.
Background and suitability for the role: Clive is a Non-Executive Director of Greatland Gold plc. Clive is a
chemical engineer and mineral economist with over thirty years’ experience in senior roles in the mining sector.
Clive joined Greatland from ERM - Environmental Resource Management, the world’s leading sustainability
consultancy group, where he is currently Senior External Advisor, and advisor to the Chairman and Chief
Executive Officer. Prior to his role at ERM, Clive worked as an independent advisor to private equity and mining
consultancy firms, and spent nine years in senior roles with Rio Tinto plc. During his time at Rio Tinto, Clive
spent four years as Copper Group Mining Executive, where he was responsible for managing Rio Tinto’s
investments in the operating businesses of Escondida in Chile, Grasberg in Indonesia, and Phalaborwa in South
Africa and for the initial development of new projects and acquisitions, including La Granja in Peru and La
Sampala in Indonesia.
The Company is committed to a culture of equal opportunities for all employees regardless of gender. The Board
will be diverse in terms of its range of culture, nationality and international experience. The current Board
members are male and, within the senior management team, there are two female geologists as well as two male
geologists.
Principle 7: Evaluate board performance based on clear and relevant objectives, seeking continuous
improvement
A board evaluation process led by the Chairman took place in October 2020. All then current Directors began
by completing a questionnaire about the effectiveness of the board and a self-assessment of their own
contributions that was returned to the Chairman. The Chairman then reviewed this information and used it as
the basis for an individual discussion with each Director, followed by a collective discussion with the board.
The review considers effectiveness in a number of areas including general supervision and management, business
risks and opportunities, succession planning, communication (both internal and external), ethics and compliance,
corporate governance and individual contribution.
A number of refinements in working practices were identified as a result of this exercise and have since been
adopted.
Principle 8: Promote a corporate culture that is based on ethical values and behaviours
The board believes that the promotion of a corporate culture based on sound ethical values and behaviours is
essential to maximise shareholder value. Our core values serve as a common language that allows all members of
staff to work together as an effective team and it is these values and our shared long-term business vision and
strategy that we believe will drive growth in shareholder value over the long term.
We are committed to three core values:
7. Creating a safe, positive and inclusive workplace environment
8. Engaging all stakeholders and the broader community with respect, integrity and honesty
9. Fostering a high performance culture that values the contribution of all team members
Principle 9: Maintain governance structures and processes that are fit for purpose and support good
decision-making by the board
The Board provides strategic leadership for the Company and operates within the scope of a robust corporate
governance framework. Its purpose is to ensure the delivery of long-term shareholder value, which involves
setting the culture, values and practices that operate throughout the business, and defining the strategic goals that
the Company implements in its business plans. The board defines a series of matters reserved for its decision and
has approved terms of reference for its Audit and Remuneration Committees to which certain responsibilities
are delegated. The chair of each committee reports to the board on the activities of that committee.
For the financial year ended 30 June 2020, the Board met nine times in relation to normal operational matters.
25
Greatland Gold plc
Company number: 5625107
Corporate Governance Statement, continued
Committees and Governance Structures
The Audit and Risk Committee, renamed from the Audit Committee, monitors the integrity of financial
statements, oversees risk management and control, monitors the effectiveness of the internal audit function and
reviews external auditor independence. The Audit Committee comprises Alex Borrelli and Clive Latcham.
Gervaise Heddle ceased membership of this Committee on 6 March 2020.
The Remuneration Committee sets and reviews the compensation of executive directors including the setting of
targets and performance frameworks for cash- and share-based awards. The Remuneration Committee comprises
Alex Borrelli and Clive Latcham.
The Executive Team, consisting of the Executive Directors, operates as a management committee, chaired by
the CEO, which reviews operational matters and performance of the business, and is responsible for significant
management decisions while delegating other operational matters to individual managers within the business.
The Chairman has overall responsibility for corporate governance and in promoting high standards throughout
the Company. He leads and chairs the board, ensuring that committees are properly structured and operate with
appropriate terms of reference, ensures that performance of individual Directors, the board and its committees
are reviewed on a regular basis, leads in the development of strategy and setting objectives, and oversees
communication between the Company and its shareholders.
The CEO provides leadership and management of the Company, leads the development of objectives, strategies
and performance standards as agreed by the board, monitors, reviews and manages key risks and strategies with
the board, ensures that the assets of the Company are maintained and safeguarded, leads on investor relations
activities to ensure communications and the Company’s standing with shareholders and financial institutions is
maintained, and ensures that the board is aware of the views and opinions of employees on relevant matters.
The Executive Directors are responsible for implementing and delivering the strategy and operational decisions
agreed by the board, making operational and financial decisions required in the day-to-day operation of the
Company, providing executive leadership to managers, championing the Company’s core values and promoting
talent management.
The Independent Non-Executive Directors contribute independent thinking and judgement through the
application of external experience and knowledge, scrutinises the performance of management, provides
constructive challenge to the Executive Directors and ensures that the Company is operating within the
governance and risk framework approved by the board.
The Company Secretary is responsible for providing clear and timely information flow to the board and its
committees and supports the board on matters of corporate governance and risk.
The matters reserved for the board are:
• Setting long-term objectives and commercial strategy;
• Approving annual operating and capital expenditure budgets;
• Changing the share capital or corporate structure of the Company;
• Approving half year and full year results and reports;
• Approving dividend policy and the declaration of dividends;
• Approving major new exploration programmes, investments, disposals, and other capital projects;
• Approving resolutions to be put to general meetings of shareholders and the associated documents or circulars;
and
• Approving changes to the board structure.
The board has approved the adoption of the QCA Code as its governance framework against which this
statement has been prepared and will monitor the suitability of this Code on an annual basis and revise its
governance framework as appropriate as the Company evolves.
26
Greatland Gold plc
Company number: 5625107
Corporate Governance Statement, continued
Internal controls
The Directors acknowledge their responsibility for the Company’s systems of internal controls and for reviewing
their effectiveness. These internal controls are designed to safeguard the assets of the Company and to ensure
the reliability of financial information for both internal use and external publication. Whilst they are aware that
no system can provide absolute assurance against material misstatement or loss, in the light of increased activity
and further development of the Company, continuing reviews of internal controls will be undertaken to ensure
that they are adequate and effective.
Insurance
The Company maintains insurance in respect of its Directors and Officers against liabilities in relation to the
Company.
Treasury Policy
The Company finances its operations through equity and holds its cash as a liquid resource to fund the obligations
of the Company. Decisions regarding the management of these assets are approved by the Board.
Securities Trading
The Board has adopted a Share Dealing Code that applies to Directors, senior management and any employee
who is in possession of ‘inside information’. All such persons are prohibited from trading in the Company’s
securities if they are in possession of ‘inside information’. Subject to this condition and trading prohibitions
applying to certain periods, trading can occur provided the relevant individual has received the appropriate
prescribed clearance.
Principle 10: Communicate how the company is governed and is performing by maintaining a dialogue
with shareholders and other relevant stakeholders
The Board recognises that meaningful engagement with its shareholders is integral to the continued success of
the Company. Over the past 12 months, members of the Board have sought to actively engage with shareholders
on a number of occasions, through meetings, presentations and investor shows (as described in Principle 2).
Over the next 12 months, the Board expects to maintain a regular dialogue with investors that will provide
investors with updates on company performance and any changes to the corporate governance structures and/or
policies.
The Board keeps investors informed through updates on the Investor Relations section of the Company’s
website.
By order of the board
Alex Borrelli
Chairman
5 November 2020
27
Greatland Gold plc
Company number: 5625107
Remuneration Committee Report
The Remuneration Committee sets and reviews the compensation of executive directors including the setting of
targets and performance frameworks and determining for such persons their total individual remuneration
packages, including, where appropriate, bonuses, incentive payments and share options or other share awards.
The remuneration of Non-executive Directors is a matter for the Chairman and the executive members of the
Board. No Director is involved in any decision as to their own remuneration.
Details on the activities of the Remuneration Committee during the year are contained in the Remuneration
Committee Report below. During the year ended 30 June 2020, and up to the signing of this report, the
Remuneration Committee comprised Alex Borrelli, who acts as Chairman, and Clive Latcham. The Remuneration
Committee formally met three times during year and all members attended the meetings.
Details of the Directors’ remuneration can be found in Note 8.
Dear Shareholder,
On behalf of the Board, I am pleased to present the Remuneration Committee Report for the year ended 30 June
2020. The Remuneration Committee is responsible for establishing and proposing to the Board a recommended
framework for the remuneration of board executive directors and designated senior executives and, pursuant to
the terms of the agreed framework, determining for such persons their total individual remuneration packages,
including, where appropriate, bonuses, incentive payments and share options or other share awards. The
Remuneration Committee is also responsible for ensuring the Company is compliant with all relevant consultant
and employment contracts and HMRC responsibilities.
Remuneration Committee Membership and Activities
The Remuneration Committee’s members during the year were Alex Borrelli, acting as Chair of the Committee,
and Clive Latcham.
The Committee met three times during the year and its activities were as follows:
•
•
•
•
reviewed Executive Directors’ performance
reviewed Executive Director remuneration arrangements
reviewed change of control provisions for Executive Directors
reviewed developments in corporate governance and best practice
Remuneration Policy
The Company’s remuneration policy is based on the following broad principles:
•
•
•
•
•
to provide competitive remuneration packages to enable the Company to recruit, retain and motivate
individuals with the skills, capabilities and experience to achieve its objectives;
to align the interests of management with the interests of shareholders;
to ensure remuneration levels support the Company’s strategy;
to align pay with market conditions and the Company’s activities; and
to provide adequate succession planning.
Alex Borrelli
Chairman
5 November 2020
28
Greatland Gold plc
Company number: 5625107
Audit and Risk Committee Report
The Audit and Risk Committee monitors the integrity of financial statements, oversees risk management and
control, monitors the effectiveness of the internal audit function and reviews external auditor independence. The
Audit and Risk Committee is appointed by the Board from amongst the non-executive directors.
The Audit and Risk Committee is authorised by the Board to investigate any activity within its terms of reference
and to obtain outside legal or other independent professional advice and to secure the attendance of outsiders
with relevant experience and expertise, if it considers this necessary.
The Audit and Risk Committee was previously named the Audit Committee until 6 March 2020.
Dear Shareholder,
On behalf of the Board, I am pleased to present the Audit Committee Report for the year ended 30 June 2020.
The Audit Committee is primarily responsible for providing oversight of the financial reporting process,
the audit process, the Company's system of internal controls and compliance with laws and regulations.
The main role and responsibilities of the Audit and Risk Committee are:
•
•
•
•
•
•
•
•
to review the company’s internal financial controls:
to monitor and review the effectiveness of the company’s internal and external audit arrangements;
to monitor and review the effectiveness of the company’s risk management systems (including without
limitation fraud risk);
to monitor the integrity of the financial statements of the company and any formal announcements
relating to the company’s financial performance, reviewing significant financial reporting judgements
contained in them;
to review and monitor the external auditor’s independence and objectivity and the effectiveness of the
audit process, taking into consideration relevant UK professional and regulatory requirements;
to make recommendations to the Board, for it to put to the shareholders for their approval in general
meeting, in relation to the appointment of the external auditor and to approve the remuneration and
terms of engagement of the external auditor;
to report to the Board, identifying any matters in respect of which it considers that action or
improvement is needed, and making recommendations as to the steps to be taken;
to consider the findings of internal investigations and management response.
Audit and Risk Committee Membership and Activities
During the year ended 30 June 2020 and up to the signing of this report, the Audit and Risk Committee comprised
Alex Borrelli, as Chairman and Clive Latcham. Gervaise Heddle was released as a member of the Audit and Risk
Committee on 6 March 2020. The Audit and Risk Committee formally met four times during year with all
members in attendance during the meetings.
The activities of the Audit and Risk Committee were as follows:
•
•
•
•
•
•
•
•
•
•
reviewed key accounting and audit judgements;
reviewed and consider whether the information provided was complete and appropriate based on its
own knowledge;
reviewed the external auditor issues that arose during the course of the audit;
reviewed the management letter in order to assess whether it is based on a good understanding of the
company’s business and establish whether recommendations have been acted upon and, if not, the
reasons why they have not been acted upon;
reviewed management’s responsiveness to the external auditor’s findings and recommendations;
reviewed whether the auditor met the agreed audit plan and understand the reasons for any changes;
obtained feedback about the conduct of the audit from key people involved;
reported to the Board on the effectiveness of the external audit process;
reviewed the appointment or reappointment of the external auditor, and information on the length of
tenure of the current audit firm;
reviewed the whistleblowing policy policies and procedures to prevent bribery and corruption.
Alex Borrelli
Chairman
5 November 2020
29
Greatland Gold plc
Company number: 5625107
Independent Auditor’s Report to the Members of Greatland Gold plc
Opinion
We have audited the financial statements of Greatland Gold plc (the ‘parent company’) and its subsidiaries (the
‘group’) for the year ended 30 June 2020 which comprise: the Group Statement of Comprehensive Income, the
Group and Company Balance Sheet, the Group and Company Statements of Changes in Equity, the Group and
Company Statements of Cash Flows and notes to the financial statements, including a summary of significant
accounting policies. The financial reporting framework that has been applied in their preparation is applicable
law and International Financial Reporting Standards (IFRSs) as adopted by the European Union and, as regards
the parent company financial statements, as applied in accordance with the provisions of the Companies Act
2006.
In our opinion:
•
•
•
the financial statements give a true and fair view of the state of the group’s and of the parent company’s
affairs as at 30 June 2020 and of the group’s and the parent company’s loss for the year then ended;
the group financial statements have been properly prepared in accordance with IFRSs as adopted by
the European Union;
the parent company financial statements have been properly prepared in accordance with IFRSs as
adopted by the European Union and as applied in accordance with the provisions of the Companies
Act 2006; and
the financial statements have been prepared in accordance with the requirements of the Companies Act
2006.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable
law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit
of the financial statements section of our report. We are independent of the group and parent company in
accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK,
including the FRC’s Ethical Standard as applied to listed entities, and we have fulfilled our other ethical
responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is
sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to
report to you were:
•
•
the directors’ use of the going concern basis of accounting in the preparation of the financial statements
is not appropriate; or
the directors have not disclosed in the financial statements any identified material uncertainties that may
cast significant doubt about the group’s or the parent company’s ability to continue to adopt the going
concern basis of accounting for a period of at least twelve months from the date when the financial
statements are authorised for issue.
Our application of materiality
We consider gross assets to be the most significant determinant of the group’s financial position and performance
used by shareholders, with the key financial statement balances being intangible exploration and evaluation assets
and cash and cash equivalents. The going concern of the group is connected to its ability to fund operations
going forward, as well as on the valuation of its assets, which represent the underlying value of the group.
Materiality for the group has been set at £171,000, based on a benchmark of 2% of gross assets.
The same basis for calculation was used for the components of the group, with the parent company set at
£170,000. Performance materiality for the group and its components was set at 70% of the over materiality figure.
We apply the concept of materiality both in planning and performing our audit, and in evaluating the effect of
misstatements. At the planning stage materiality is used to determine the financial statement areas that are
included within the scope of our audit and the extent of sample sizes during the audit. Component materiality
for significant and/or material subsidiary undertakings ranged from £86,000 to £170,000.
We agreed with the audit committee that we would report to the committee all audit differences identified during
the course of our audit in excess of £8,550, as well as differences below these thresholds that in our view,
warranted reporting on qualitative grounds.
30
Greatland Gold plc
Company number: 5625107
Independent Auditor’s Report to the Members of Greatland Gold plc, continued
An overview of the scope of our audit
In designing our audit, we determined materiality and assessed the risk of material misstatement in the financial
statements. In particular, we looked at areas requiring the directors to make subjective judgements, for example
in respect of significant accounting estimates including the carrying value of exploration, evaluation and
development expenditure (identified as a key audit matter), the carrying value and recoverability of investments
in subsidiaries at parent company level (identified as a key audit matter), the valuation of share-based payments,
and the consideration of future events that are inherently uncertain. We also addressed the risk of management
override of internal controls, including evaluating whether there was evidence of bias by the directors that
represented a risk of material misstatement due to fraud.
An audit was performed on the financial information of the group’s significant operating components which, for
the year ended 30 June 2020, were located in the United Kingdom and Australia, with the group’s accounting
functions being based in the UK and Australia.
The Australian component was audited by local Australian firm operating under our instruction. This audit was
performed both for consolidation purposes as well as local statutory purposes. There was regular interaction with
the component auditor during all stages of the audit, and we were responsible for the scope and direction of the
audit process.
We obtained and reviewed remotely the key audit working papers prepared by the auditors of the Australian
component, which related to the work performed on the significant risks identified at group level. The
component auditor also provided their findings to us which were reviewed and challenged accordingly.
The approach detailed above gave us sufficient appropriate evidence for our opinion on the group financial
statements.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit
of the financial statements of the current period and include the most significant assessed risks of material
misstatement (whether or not due to fraud) we identified, including those which had the greatest effect on the
overall audit strategy, the allocation of resources in the audit; and directing the efforts of the engagement team.
These matters were addressed in the context of our audit of the financial report as a whole, and in forming our
opinion thereon, and we do not provide a separate opinion on these matters.
31
Greatland Gold plc
Company number: 5625107
Independent Auditor’s Report to the Members of Greatland Gold plc, continued
We have determined the matters described below to be the key audit matters to be communicated in our report.
Key Audit Matter
How the scope of our audit responded to the key
audit matter
Carrying value and appropriate capitalisation of Intangible Assets (Note 11)
The group has intangible assets in relation to
capitalized exploration costs in respect of its
Australian projects. There is the risk that these
assets have been incorrectly capitalized in
accordance with IFRS 6 and that there are
indicators of impairment as at 30 June 2020.
Particularly for early stage exploration projects
where the calculation of recoverable amount via
value in use calculations is not possible,
management’s assessment of impairment under
IFRS 6 requires estimation and judgement.
Our audit work included:
Obtaining copies of and ensuring the Group
has good title to the applicable exploration
licences;
Reviewing capitalised costs including
consideration of appropriateness for
capitalisation under IFRS 6;
An assessment of progress at the individual
projects during the year and post year-end; and
Consideration of management’s impairment
reviews, including challenge to all key
assumptions and sensitivity to reasonably
possible changes.
Recoverability of investments and intragroup balances (Note 14)
Investments in subsidiaries and intra group
loans are significant assets in the Parent
Company's financial statements. Their
recoverability is directly linked to the
recoverability of intangible assets in those
entities, and hence may not be fully
recoverable.
Our work in this area included:
• Obtaining copies of ownership documents;
• Considerations of recoverability of
investments and intra company loans by
reference to underlying net asset values and
exploration projects; and
• Challenging managements assumptions
thereto
Other information
The other information comprises the information included in the annual report, other than the financial
statements and our auditor’s report thereon. The directors are responsible for the other information. Our opinion
on the group and parent company financial statements does not cover the other information and, except to the
extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. In
connection with our audit of the financial statements, our responsibility is to read the other information and, in
doing so, consider whether the other information is materially inconsistent with the financial statements or our
knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material
inconsistencies or apparent material misstatements, we are required to determine whether there is a material
misstatement in the financial statements or a material misstatement of the other information. If, based on the
work we have performed, we conclude that there is a material misstatement of this other information, we are
required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
•
•
the information given in the strategic report and the directors’ report for the financial year for which
the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors’ report have been prepared in accordance with applicable legal
requirements.
32
Greatland Gold plc
Company number: 5625107
Independent Auditor’s Report to the Members of Greatland Gold plc, continued
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the group and the parent company and their environment
obtained in the course of the audit, we have not identified material misstatements in the strategic report or the
directors’ report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006
requires us to report to you if, in our opinion:
•
•
adequate accounting records have not been kept by the parent company, or returns adequate for our
audit have not been received from branches not visited by us; or
the parent company financial statements are not in agreement with the accounting records and returns;
or
•
certain disclosures of directors’ remuneration specified by law are not made; or
• we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the Statement of Directors’ Responsibilities, the directors are responsible for the
preparation of the group and parent company financial statements and for being satisfied that they give a true
and fair view, and for such internal control as the directors determine is necessary to enable the preparation of
financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the group and parent company financial statements, the directors are responsible for assessing the
group’s and the parent company’s ability to continue as a going concern, disclosing, as applicable, matters related
to going concern and using the going concern basis of accounting unless the directors either intend to liquidate
the group or the parent company or to cease operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are 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 ISAs (UK) 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 these financial statements.
A further description of our responsibilities for the audit of the financial statements is located on the Financial
Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s
report.
Use of our report
This report is made solely to the Company’s members, as a body, in accordance with Chapter 3 of Part 16 of the
Companies Act 2006. Our audit work has been undertaken so that we might state to the Company’s members
those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest
extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the
Company’s members as a body, for our audit work, for this report, or for the opinions we have formed.
Joseph Archer (Senior Statutory Auditor)
For and on behalf of PKF Littlejohn LLP
Statutory Auditor
5 November 2020
15 Westferry Circus
Canary Wharf
London E14 4HD
33
Group statement of comprehensive income
for the year ended 30 June 2020
Greatland Gold plc
Company number: 5625107
Notes
Year ended
30 June 2020
Year ended
30 June 2019
2
12
3
3
5
5
£
-
£
-
(3,392,789)
(2,309,760)
(1,632,571)
(67,396)
(65,230)
(38,376)
(888,661)
(37,131)
-
(18,450)
(5,196,362)
(3,254,002)
55,438
17,663
(21,734)
-
5,195
(15,500)
(5,144,995)
(3,264,307)
-
-
(5,144,995)
(3,264,307)
207,440
207,440
(52,730)
(52,730)
(4,937,555)
(3,317,037)
Revenue
Exploration costs
Administrative expenses
Depreciation
Amortisation
Impairment cost
Operating loss
Other income
Finance income
Finance costs
Loss before taxation
Income tax expense
Loss for the year
Other comprehensive income
Items that may be reclassified subsequently to profit
and loss:
Exchange differences on translation of foreign
operations
Other comprehensive income for the year
net of taxation
Total comprehensive income for the year
attributable to equity holders of the parent
company
Earnings per share – basic (pence)
9
(0.14)
(0.10)
All operations are considered to be continuing.
The accompanying notes form part of these financial statements.
34
Greatland Gold plc
Company number: 5625107
Note
30 June 2020
30 June 2019
£
£
£
£
10
11
12
18
14
132,061
1,989,363
414,616
6,022,745
79,076
103,114
2,016,783
-
2,536,040
2,119,897
2,755,998
77,480
6,101,821
8,637,861
2,833,478
4,953,375
Group balance sheet
as at 30 June 2020
ASSETS
Non-current assets
Tangible assets
Intangible assets
Right of use asset
Total non-current assets
Current assets
Cash and cash equivalents
Trade and other receivables
Total current assets
TOTAL ASSETS
LIABILITIES
Current liabilities
Trade and other payables
15
(932,759)
(630,369)
Total current liabilities
Non-current liabilities
(932,759)
(630,369)
Other non-current payables
15
(390,718)
-
Total non-current liabilities
TOTAL LIABILITIES
NET ASSETS
(390,718)
(1,323,477)
7,314,384
-
(630,369)
4,323,006
EQUITY
Share capital
Share premium
16
3,760,207
19,878,782
Share based payment reserve
17
372,953
Retained earnings
Other reserves
(17,073,458)
375,900
3,323,420
12,554,173
349,606
(12,072,653)
168,460
TOTAL EQUITY
7,314,384
4,323,006
The accompanying notes form part of these financial statements
These financial statements were approved by the Board of Directors on 5 November 2020 and signed
on its behalf by:
Alex Borrelli
Chairman
Gervaise Heddle
Chief Executive Officer
35
Greatland Gold plc
Company number: 5625107
Group statement of changes in equity
for the year ended 30 June 2020
Share capital
Share
premium
Share based
payment
reserve
Retained
earnings
Other
reserves
Total
£
£
£
£
£
£
As at 30 June 2018
3,002,256
9,749,891
243,472
(8,950,444)
221,190
4,266,365
Loss for the year
Currency translation
differences
Total comprehensive
income
Share option charge
Transfer on exercise of
options and warrants
-
-
-
-
-
-
-
-
-
-
-
-
-
(3,264,307)
-
(3,264,307)
-
(52,730)
(52,730)
(3,264,307)
(52,730)
(3,317,037)
248,232
-
(142,098)
142,098
Share capital issued
321,164
2,936,782
Cost of share issue
-
(132,500)
-
-
-
-
321,164
2,804,282
106,134
142,098
-
-
-
-
-
248,232
-
3,257,946
(132,500)
3,373,678
Total contributions by
and distributions to
owners of the Company
As at 30 June 2019
originally presented
Adjustment from the
adoption of IFRS 16
Restated as at 30 June
2019
Loss for the year
Currency translation
differences
Total comprehensive
income
Share option charge
Transfer on exercise of
options and warrants
Share capital issued
Cost of share issue
Total contributions by
and distributions to
owners of the Company
3,323,420
12,554,173
349,606
(12,072,653)
168,460
4,323,006
-
-
-
13,045
-
13,045
3,323,420
12,554,173
349,606
(12,059,608)
168,460
4,336,051
-
-
-
(5,144,995)
-
(5,144,995)
-
207,440
207,440
(5,144,995)
207,440
(4,937,555)
-
-
-
-
-
-
-
-
-
-
154,492
-
(131,145)
131,145
436,787
7,543,487
-
(218,878)
-
-
-
-
436,787
7,324,609
23,347
131,145
-
-
-
-
-
154,492
-
7,980,274
(218,878)
7,915,888
As at 30 June 2020
3,760,207
19,878,782
372,953
(17,073,458)
375,900
7,314,384
The accompanying notes for part of these financial statements.
Note:
In the current year the Group adopted IFRS 16 and applied the modified retrospective approach. The cumulative effect of
adoption is recognised as an adjustment to retained earnings.
36
Group statement of changes in equity
for the year ended 30 June 2020, continued
Other reserves
Merger reserve
Foreign currency
translation reserve
Total other
reserves
Greatland Gold plc
Company number: 5625107
As at 30 June 2018
Currency translation differences
Total comprehensive income
As at 30 June 2019
Currency translation differences
Total comprehensive income
As at 30 June 2020
£
225,000
-
-
225,000
-
-
225,000
£
(3,810)
(52,730)
(52,730)
(56,540)
207,440
207,440
150,900
£
221,190
(52,730)
(52,730)
168,460
207,440
207,440
375,900
The following describes the nature and purpose of each reserve within equity:
Share capital:
Share premium:
Nominal value of shares issued
Amount subscribed for share capital in excess of nominal value, less share issue costs
Share based payment reserve:
Cumulative fair value of options granted
Retained losses:
Merger reserve:
Cumulative net gains and losses, recognised in the statement of comprehensive
income
The merger reserve was created in accordance with the merger relief provisions of
the Companies Act 1985 (as amended), and 2006, relating to accounting for business
combinations involving the issue of shares at a premium. In preparing group
consolidated financial statements, the amount by which the fair value of the shares
issued exceeded their nominal value was recorded within a merger reserve on
consolidation, rather than in a share premium account.
Foreign currency reserve:
Gains/losses arising on translation of foreign controlled entities into pounds
sterling.
37
Greatland Gold plc
Company number: 5625107
Company balance sheet
as at 30 June 2020
ASSETS
Non-current assets
Investment in subsidiary
Right of use asset
Total Non-current Assets
Current assets
Note
30 June 2020
30 June 2019
£
£
£
£
13
12
50,000
75,399
50,000
-
125,399
50,000
Cash and cash equivalents
Trade and other receivables
18
14
4,257,920
11,387,759
2,247,271
6,624,946
Total Current Assets
TOTAL ASSETS
LIABILITIES
Current Liabilities
15,645,679
15,771,078
8,872,217
8,922,217
Trade and other payables
15
(192,476)
(255,510)
Total current liabilities
(192,476)
(255,510)
Other non-current payables
15
(37,506)
-
Total non-current liabilities
TOTAL LIABILITIES
NET ASSETS
EQUITY
Share capital
Share premium
Share based payment reserve
17
Merger reserve
Retained earnings
16
3,760,207
19,878,782
372,953
225,000
(8,695,846)
(37,506)
(229,982)
15,541,096
-
(255,510)
8,666,707
3,323,420
12,554,173
349,606
225,000
(7,785,492)
TOTAL EQUITY
15,541,096
8,666,707
A separate income statement for the parent company has not been presented, as permitted by section
408 of the Companies At 2006. The Company’s loss for the year was £1,054,544.
The accompanying notes form part of these financial statements.
These financial statements were approved by the Board of Directors on 5 November 2020 and signed
on its behalf by:
Alex Borrelli
Chairman
Gervaise Heddle
Chief Executive Officer
38
Greatland Gold plc
Company number: 5625107
Company statement of changes in equity
for the year ended 30 June 2020
Share
capital
Share
premium
Share based
payment
reserve
Retained
earnings
Merger
reserve
Total
£
£
£
£
£
£
As at 30 June 2018
3,002,256
9,749,891
243,472
(6,997,503)
225,000
6,223,116
Loss for the year
Total comprehensive
income
Share option charge
Transfer on exercise of
options and warrants
Share capital issued
Cost of share issue
Total contributions by and
distributions to owners of
the Company
As at 30 June 2019 originally
presented
Adjustment from the adoption
of IFRS 16
-
-
-
-
-
-
-
-
-
-
(930,087)
(930,087)
248,232
-
(142,098)
142,098
321,164
2,936,782
-
(132,500)
-
-
-
-
321,164
2,804,282
106,134
142,098
-
-
-
-
-
-
-
(930,087)
(930,087)
248,232
-
3,257,946
(132,500)
3,373,678
3,323,420
12,554,173
349,606
(7,785,492)
225,000
8,666,707
-
-
-
13,045
-
13,045
Restated as at 30 June 2019
3,323,420
12,554,173
349,606
(7,772,447)
225,000
8,679,752
Loss for the year
Total comprehensive
income
Share option charge
Transfer on exercise of
options and warrants
-
-
-
-
-
-
-
-
-
-
(1,054,544)
(1,054,544)
154,492
-
(131,145)
131,145
Share capital issued
436,787
7,543,487
Cost of share issue
-
(218,878)
-
-
-
-
Total contributions by and
distributions to owners of
the Company
436,787
7,324,609
23,347
131,145
-
-
-
-
-
-
-
(1,054,544)
(1,054,544)
154,492
-
7,980,274
(218,878)
7,915,888
As at 30 June 2020
3,760,207
19,878,782
372,953
(8,695,846)
225,000
15,541,096
The accompanying notes for part of these financial statements.
39
Group cash flow statement
for the year ended 30 June 2020
Cash flows from operating activities
Operating loss
(Increase)/Decrease in trade & other receivables
Increase/(Decrease) in trade & other payables
Depreciation
Amortisation
Impairment charge
Share option charge
Net decrease in cash and cash equivalents from
operating activities
Cash flows from investing activities
Interest received
Interest payable
Payments to acquire intangible assets
Payments to acquire tangible assets
Net cash outflows used in investing activities
Cash flows from financing activities
Proceeds from issue of shares
Transaction costs of issue of shares
Other income (cash boost)
Repayment of lease liabilities
Greatland Gold plc
Company number: 5625107
Notes
Year ended
30 June 2020
Year ended
30 June 2019
£
£
(5,183,317)
(3,254,001)
(1,596)
293,450
67,396
65,230
38,376
154,492
1,581
(70,454)
37,131
-
18,450
248,232
(4,565,969)
(3,019,061)
2,163
(21,734)
9,640
(95,624)
(105,555)
7,980,274
(218,878)
55,438
(67,877)
7,748,957
3,077,433
2,755,998
189,314
5,195
-
(688,519)
(98,774)
(782,098)
3,115,900
(132,500)
-
-
2,983,400
(817,759)
3,597,101
(23,344)
2,755,998
Net cash inflows from financing activities
Net increase/(decrease) in cash and cash
equivalents
18
Cash and cash equivalents at the beginning of period
Exchange gain/(loss) on cash and cash equivalents
Cash and cash equivalents at end of period
18
6,022,745
During the year shares in the Company for a consideration of £nil (2019: £142,045) were issued for
the acquisition of intangible assets (see Note 16). This amount represents material non-cash flows and
is excluded from the cash flow statement.
The accompanying notes form part of these financial statements.
40
Company cash flow statement
for the year ended 30 June 2020
Cash flows from operating activities
Operating loss
(Increase)/Decrease in trade & other receivables
(Decrease)/Increase in trade & other payables
Amortisation
Share option charge
Net decrease in cash and cash equivalents from
operations
Cash flows from investing activities
Interest received
Interest payable
Loans to subsidiary
Greatland Gold plc
Company number: 5625107
Notes
Year ended
30 June 2020
Year ended
30 June 2019
£
£
(1,048,003)
(914,836)
(12,813)
(71,974)
25,133
154,492
(953,165)
5,749
170,901
-
248,232
(489,954)
275
(9,271)
250
-
(4,750,000)
(3,000,000)
Net cash outflows used in investing activities
(4,758,996)
(2,999,750)
Cash flows from financing activities
Proceeds from issue of shares
Transaction costs of issue of shares
Repayment of lease liability
Net cash flows from financing activities
Net increase/(decrease) in cash and cash
equivalents
Cash and cash equivalents at the beginning of period
Cash and cash equivalents at end of period
18
18
7,980,274
(218,878)
(38,586)
7,722,810
2,010,649
2,247,271
4,257,920
3,115,900
(132,500)
-
2,983,400
(506,304)
2,753,575
2,247,271
During the year shares in the Company for a consideration of £nil (2019: £142,045) were issued for
the acquisition of intangible assets (see Note 16). This amount represents material non-cash flows and
is excluded from the cash flow statement.
The accompanying notes form part of these financial statements.
41
Greatland Gold plc
Company number: 5625107
Notes to financial statements
for the year ended 30 June 2020
1
Principal accounting policies
1.1
Authorisation of financial statements and statement of compliance with IFRS
The group financial statements of Greatland Gold plc for the year ended 30 June 2020 were
authorised for issue by the board on 5 November 2020 and the balance sheets signed on the board’s
behalf by Mr Gervaise Heddle and Mr Alex Borrelli. Greatland Gold plc is a public limited company
incorporated and domiciled in England and Wales. The Company’s ordinary shares are traded on
AIM.
The Group’s financial statements have been prepared in accordance with International Financial
Reporting Standards (IFRS). The Company’s financial statements have been prepared in accordance
with IFRS as adopted by the European Union and as applied in accordance with the provisions of
the Companies Act 2006. The principal accounting policies adopted by the Group and Company are
set out below.
New standards, amendments and interpretations adopted by the Group
Effective 1 July 2019, the Group and Company adopted the provisions of IFRS 16 – Leases on a
modified retrospective basis, recognising the cumulative effect of initial application to opening
retained earnings for the period.
At transition, for leases classified as operating leases under IAS 17, lease liabilities were measured at
the present value of the remaining lease payments, discounted at the Group’s incremental borrowing
rate. The Group used the following practical expedients when applying IFRS 16:
Applied the exemption not to recognize right of use assets and liabilities for leases with less
than 12 months of lease term;
Excluded initial direct costs from measuring the right of use asset at the date of initial
application; and
Apply a single discount rate to a portfolio of leases with similar characteristics.
The change in accounting policy affected the following items in the statement of financial position
on 1 July 2019:
Right of Use assets – Properties
Lease Liability – current
Lease Liability – non current
Adjustment to opening retained earnings as at 1 July 2019
479,846
(123,926)
(355,920)
13,045
There are no other IASB and IFRIC standards that have been issued with an effective date after the
date of the financial statements which are expected to have a material impact on the Group.
42
Notes to financial statements
for the year ended 30 June 2020, continued
1.2
Significant accounting judgments, estimates and assumptions
Greatland Gold plc
Company number: 5625107
Significant accounting estimates and assumptions
The carrying amounts of certain assets and liabilities are often determined based on estimates and
assumptions of future events. The key estimates and assumptions that have a significant risk of
causing a material adjustment to the carrying amounts of certain assets and liabilities within the next
annual reporting period are:
Impairment of intangibles with indefinite useful lives (Note 11)
Exploration and evaluation costs have a carrying value at 30 June 2020 of £1,989,363 (2019:
£2,016,783). Such assets have an indefinite useful life as the Group has a right to renew exploration
licences and the asset is only amortised once extraction of the resource commences. The value of the
Group’s exploration, evaluation and development expenditure will be dependent upon the success of
the Group in discovering economic and recoverable mineral resources. The future revenue flows
relating to these assets is uncertain and will also be affected by competition, relative exchange rates
and potential new legislation and related environmental requirements. The Group’s ability to continue
its exploration programs and develop its projects is dependent on future fundraisings the outcome of
which is uncertain. There have been no changes made to any past assumptions.
The Directors have undertaken a review to assess whether circumstances exist which could indicate
the existence of impairment as follows:
The Group no longer has title to mineral leases.
A decision has been taken by the Board to discontinue exploration due to the absence of a
commercial level of reserves.
Sufficient data exists to indicate that the costs incurred will not be fully recovered from
future development and participation.
Following their assessment, the Directors concluded that an impairment charge of £38,376 is
required.
Share-based payment transactions (Note 17)
The Group measures the cost of equity-settled transactions with employees by reference to the fair
value of the equity instruments at the date at which they are granted. The fair value is determined
using a Black-Scholes model and a 40% discount is applied to that value due to the recent volatility
of the share price over the valuation period.
43
Greatland Gold plc
Company number: 5625107
Notes to financial statements
for the year ended 30 June 2020, continued
1.3
Basis of preparation
The consolidated financial statements of Greatland Gold plc and its subsidiary have been prepared in
accordance with International Reporting Standards (IFRS) as adopted for use in the European Union.
The consolidated financial statements have been prepared on the historical cost basis, except for the
measurement to fair value of assets and financial instruments as described in the accounting policies
below, and on a going concern basis.
The amounts presented in the consolidated financial statements are rounded to the nearest £1.
Going Concern
The consolidated entity has incurred a loss before tax of £5,144,995 for the year ended 30 June 2020
and had a net cash outflow of £4,671,524 from operating and investing activities. At that date there
were net current assets of £5,169,062. The loss resulted almost entirely from exploration costs and
associated administrative related costs.
The Directors are confident in the Company’s ability to raise new finance from stock markets if this
is required during 2021 and the Group has demonstrated a consistent ability to do so.
The Group’s cash flow forecast for the period ending 31 December 2021 highlights adequate funding
at current levels of projected expenditure to last throughout this period. The Board of Directors are
confident that sufficient funding is in place to meet all its operational and exploration commitments
over the next twelve months and to remain cash positive for the whole period.
Given the Group’s current positive cash position and its ability to raise new capital the Directors have
a reasonable expectation that the Group has adequate resources to continue in operational existence
for the foreseeable future. For these reasons, they continue to adopt the going concern basis in
preparing the annual report and accounts.
At present the Group believes that there should be no significant material disruption to its operations
from COVID-19 in the near term, but the Board continues to monitor these risks and the Group’s
business continuity plans.
Having prepared forecasts based on current resources, assessing methods of obtaining additional
finance and assessing the possible impact of COVID-19, the Directors believe the Group has
sufficient resources to meet its obligations for a period of 12 months from the date of approval of
these financial statements. Taking these matters into consideration, the Directors continue to adopt
the going concern basis of accounting in the preparation of the financial statements. The financial
statements do not include the adjustments that would be required should the going concern basis of
preparation no longer be appropriate.
44
Greatland Gold plc
Company number: 5625107
Notes to financial statements
for the year ended 30 June 2020, continued
1.4
Basis of consolidation
The consolidated accounts combine the accounts of the Company and its sole subsidiary, Greatland
Pty Ltd, using the purchase method of accounting.
In the Company’s balance sheet, the investment in Greatland Pty Ltd includes the nominal value of
shares issued together with the cash element of the consideration. As required by the Companies Act
2006, no premium was recognised on the share issue. The difference between nominal and fair value
of the shares issued was credited to the merger reserve.
Subsidiary undertakings are those entities controlled directly or indirectly by the Company. The
Company controls an investee when it is exposed to, or has rights to, variable returns from its
involvement with the entity and has the ability to affect those returns through its power over the
entity. The results of the subsidiaries acquired are included in the Consolidated Statement of
Comprehensive Income from the date of acquisition using the same accounting policies of those of
the Group. The consideration transferred in a business combination is the fair value at the acquisition
date of the assets transferred and the liabilities incurred by the Group and includes the fair value of
any contingent consideration arrangement. Acquisition-related costs are recognised in the income
statement as incurred. Identifiable assets acquired and liabilities and contingent liabilities assumed in
a business combination are measured initially at their fair value at the acquisition date.
Where necessary, adjustments are made to the financial statements of subsidiaries to bring their
accounting policies in line with those used by other members of the Group.
All intra-group balances and transactions, including any unrealized income and expenses arising from
intragroup transactions, are eliminated in full in preparing the consolidated financial statements.
Unrealised gains arising from transactions with equity accounted investees are eliminated against the
investment to the extent of the Group’s interest in the investee. Unrealized losses are eliminated in
the same way as unrealized gains, but only to the extent that there is no evidence of impairment.
1.5
Investment in subsidiaries
Investments in subsidiary companies are classified as non-current assets and included in the balance
sheet of the Company at cost, less provision for impairment at the date of acquisition irrespective of
the application of merger relief under the Companies Act.
1.6
Cash and cash equivalents
Cash and short-term deposits in the balance sheet comprise cash at bank and in hand and short-term
deposits with an original maturity of three months or less.
For the purposes of the Cash Flow Statement, cash and cash equivalents consist of cash and cash
equivalents as defined above, net of outstanding bank overdrafts.
1.7
Income tax and deferred taxation
Current tax assets and liabilities for the current and prior periods are measured as the amount expected
to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute
the amount are those that are enacted or substantially enacted by the balance sheet date.
Full provision is made for deferred taxation resulting from timing differences which have arisen but
not reversed at the balance sheet date.
Deferred tax assets on carried forward losses are only recorded where it is expected that future trading
profits will be generated in which this asset can be offset. The carrying amount of deferred tax assets
is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that
sufficient taxable profits will be available to allow all or part of the asset to be recovered.
Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is
settled or the asset realised. Deferred tax is charged or credited to profit or loss, except when it relates
to items charged or credited directly to equity, in which case the deferred tax is also dealt with in
equity.
45
Greatland Gold plc
Company number: 5625107
Notes to financial statements
for the year ended 30 June 2020, continued
1.8
Tangible fixed assets
Fixed assets are depreciated on a straight-line basis at annual rates that will reduce the book amounts
to estimated residual values over their anticipated useful lives as follows:
• Motor vehicles: 20% per annum
• Equipment: 7% per annum
• Leasehold improvements: 11% per annum
1.9
Right of use assets
At inception of a contract, the Company assesses if the contract contains or is a lease. If there is a
lease present, a right-of-use asset and a corresponding lease liability is recognised by the company
where the company is a lessee. However, all contracts that are classified as short-term leases (i.e. a
lease with a remaining lease term of 12 months or less) and leases of low-value assets are recognised
as an operating expense on a straight line basis over the term of the lease.
Initially, the lease liability is measured at the present value of the lease payments still to be paid at
commencement date. The lease payments are discounted at the interest rate implicit in the lease. If
the rate cannot be readily determined, the company uses the incremental borrowing rate.
Lease payments included in the measurement of the lease liability are as follows:
• Fixed lease payments less any lease incentives;
• Variable lease payments that depend of an index rate, initially measured using the index rate
of rate at the commencement date;
• The amount expected to be payable by the lesses under the residual value guarantees;
• The exercise price of purchase options, if the lessee is reasonably certain to exercise the
options;
• Lease payments under extension options, if the lessee is reasonably certain to exercise the
options; and
• Payments of penalties for terminating the lease, if the lease term reflects the exercise of an
options.
The right-of-use assets comprise the initial measurement of the corresponding lease liability as
mentioned above, any to terminate the lease payments made at or before the commencement date, as
well as any initial direct costs. The subsequent measurement of the right-of-use assets is at cost less
accumulated depreciation and impairment losses. Right-of-use assets are depreciated over the lease
term of useful life of the underlying asset, whichever is the shortest. Where a lease transfers ownership
of the underlying asset of the cost of the right-of-use asset reflects that the company anticipates to
exercise a purchase option, the specific asset is depreciated over the useful life of the underlying asset.
1.10
Foreign currencies
Both the functional and presentational currency of Greatland Gold plc is sterling (£). Each group
entity determines its own functional currency and items included in the financial statements of each
entity are measured using that functional currency.
The functional currency of the foreign subsidiary, Greatland Pty Limited, is Australian Dollars (A$).
Transactions in foreign currencies are recorded at the rate ruling at the date of the transaction.
Monetary assets and liabilities denominated in foreign currencies are translated at the rate of exchange
ruling at the balance sheet date. All differences are taken to the income statement.
On consolidation of a foreign operation, assets and liabilities are translated at the balance sheet rates,
income and expenses are translated at rates ruling at the transaction date. Exchange differences on
consolidation are taken to the income statement.
46
Greatland Gold plc
Company number: 5625107
Notes to financial statements
for the year ended 30 June 2020, continued
1.11
Other income
During the year Greatland Pty Ltd received two ‘Cash Boost’ grants totalling A$100,000 (£55,438)
from the state government of Western Australia. These grants were provided to support businesses
during the COVID-19 pandemic. Government grants are recognised only when there is reasonable
assurance that the Group will comply with the conditions attaching to the grant and that the grants
will be received. Capital grants are recognised to match the related development expenditure and are
deducted in arriving at the carrying value of the related assets. Any grants that are received in advance
of recognition are deferred.
The Group had no other income during the periods ended 30 June 2020 and 30 June 2019. Previous
years consisted of a grant from the state government of Western Australia. Government grants are
accounted for on a receipts basis.
1.12
Finance costs
Borrowing costs are recognised as an expense when incurred.
Finance income is recognised as interest accrues using the effective interest method. This is a method
of calculating the amortised cost of a financial asset and allocating the interest income over the
relevant period using the effective interest rate, which is the rate that exactly discounts estimated
future cash receipts through the expected life of the financial asset to the net carrying amount of the
financial asset.
1.13
Trade and other receivables
Trade and other receivables are recognised initially at fair value and subsequently measured at
amortised cost using the effective interest method, less any allowance for the expected future issue of
credit notes and for non-recoverability due to credit risk. The Group applies the IFRS 9 simplified
approach to measuring expected credit losses which uses a lifetime expected loss allowance for all
trade receivables and contract assets. To measure expected credit losses, trade receivables and contract
assets have been grouped based on shared risk characteristics. No such credit loss has been recorded
in these financial statements as any effect would be immaterial.
1.14
Financial instruments
Financial assets and liabilities are recognized in the Group’s Statement of Financial Position when the
Group becomes a party to the contracted provision of the instrument. The following policies for
financial instruments have been applied in the preparation of the consolidated financial statements:
The Group and Company’s financial assets which comprise loans and receivables and other debtors
are measured at amortised cost.
The classification depends on the business model for managing the financial assets and the contractual
terms of the cash flows. Financial assets are classified as at amortised cost only if both of the following
criteria are met:
the asset is held within a business model whose objective is to collect contractual cash flows; and
the contractual terms give rise to cash flows that are solely payments of principal and interest
1.15
Trade and other payables
Trade payables and other payables are carried at amortised cost and represent liabilities for goods and
services provided to the Group prior to the end of the financial year that are unpaid and arise when
the Group becomes obliged to make future payments in respect of the purchase of these goods and
services.
47
Greatland Gold plc
Company number: 5625107
Notes to financial statements
for the year ended 30 June 2020, continued
1.16
Earnings per share
Basic earnings per share is calculated as net profit attributable to members of the parent, adjusted
to exclude any costs of servicing equity (other than dividends) and preference share dividends,
divided by the weighted average number of ordinary shares, adjusted for any bonus element.
Diluted earnings per share is calculated as net profit attributable to members of the parent,
adjusted for:
•
•
•
costs of servicing equity (other than dividends) and preference share dividends;
the after tax effect of dividends and interest associated with dilutive potential ordinary shares
that have been recognised as expenses; and
other non-discretionary changes in revenues or expenses during the period that would result
from the dilution of potential ordinary shares; divided by the weighted average number of
ordinary shares and dilutive potential ordinary shares, adjusted for any bonus element.
1.17
Exploration and development expenditure
Exploration and development costs include expenditure on prospects at an exploratory stage.
These costs include the cost of acquisition, exploration, determination of recoverable reserves,
economic feasibility studies and all technical and administrative overheads directly associated
with those projects. Costs associated with an exploration activity will only be capitalised if, in
management’s opinion, the results from that activity led to a material increase in the market value
of the exploration asset which is determined by management to be following the economic
feasibility stage. Generally, costs associated with non-drilling activities, such as geophysical and
geochemical surveys, are not capitalised. Costs associated with drilling activities at an exploration
asset may be capitalised, on a case by case basis, depending upon management’s assessment of
the impact of those activities on the market value of that particular asset at that time which is
determined by management to be following the economic feasibility stage..
Recoupment of capitalised exploration and development costs is dependent upon successful
development and commercial exploitation of each area of interest and are amortised over the
expected commercial life of each area once production commences. The Company adopts the
‘area of interest’ method of accounting whereby a substantial proportion of exploration and
development costs relating to an area of interest are capitalised and carried forward until
abandoned. In the event that an area of interest is abandoned, or if the Directors consider the
expenditure to be of no value, accumulated exploration costs are written off in the financial year
in which the decision is made. All expenditure incurred prior to approval of an application is
expensed with the exception of refundable rent which is raised as a debtor.
Impairment reviews are carried out regularly by the Directors of the Company. Where a project
is abandoned or is considered not to be of commercial value to the Company, the related costs
are written off or provisions are made.
1.18
Share based payments
The fair value of options granted to directors and others in respect of services provided is
recognised as an expense in the profit and loss account with a corresponding increase in equity
reserves – the share based payment reserve.
On exercise or cancellation of share options, the proportion of the share based payment reserve
relevant to those options is transferred to the profit and loss account reserve. On exercise, equity
is also increased by the amount of the proceeds received.
The fair value is measured at grant date and the charge is spread over the relevant vesting period.
The fair value of options is calculated using the Black-Scholes model taking into account the
terms and conditions upon which the options were granted. Vesting conditions are non-market
and there are no market vesting conditions. The exercise price is fixed at the date of grant and no
compensation is due at the date of grant.
48
Greatland Gold plc
Company number: 5625107
Notes to financial statements
for the year ended 30 June 2020, continued
2
Revenue and segmental analysis
The Group’s prime business segment is mineral exploration.
The Group operates within two geographical segments, the United Kingdom and Australia. The
UK sector consists of the parent company which provides administrative and management
services to the subsidiary undertaking based in Australia.
The aggregation of these two segments into a single United Kingdom business unit reflects the
way information is presented to the Chief Operating Decision Maker, who is the Group’s Chief
Executive Officer.
The following tables present revenue and loss information and certain asset and liability
information by geographical segments:
Year ended 30 June 2020
Revenue
Total segment revenue
Total consolidated revenue
Result
Segment results
UK
£
-
-
Australia
Total
£
-
-
£
-
-
(1,061,048)
(4,135,314)
(5,196,362)
Loss before tax and finance income/costs
(1,061,048)
(4,135,314)
(5,196,362)
Interest receivable
Interest payable
Other income
Loss before taxation
Taxation expense
Loss after taxation
As at 30 June 2020
Assets and liabilities
Segment assets
Total assets
Segment liabilities
Total liabilities
Other segment information:
Capital expenditure
Depreciation
Amortisation
Impairment
275
1,888
6,229
(12,463)
-
55,438
2,163
(6,234)
55,438
(1,054,544)
(4,090,451)
(5,144,995)
-
-
-
(1,054,544)
(4,090,451)
(5,144,995)
UK
£
Australia
£
Total
£
4,374,330
4,263,531
4,374,330
4,263,531
8,637,861
8,637,861
(229,983)
(1,093,494)
(1,323,477)
(229,983)
(1,093,494)
(1,323,477)
-
-
25,133
-
85,984
67,396
40,097
38,376
85,984
67,396
65,230
38,376
49
Greatland Gold plc
Company number: 5625107
Notes to financial statements
for the year ended 30 June 2020, continued
2
Revenue and segmental analysis, continued
Year ended 30 June 2019
Revenue
Total segment revenue
Total consolidated revenue
Result
Segment results
UK
£
-
-
Australia
Total
£
-
-
£
-
-
(914,837)
(2,339,165)
(3,254,002)
Loss before tax and finance costs
(914,837)
(2,339,165)
(3,254,002)
Interest receivable
Interest payable
Loss before taxation
Taxation expense
Loss after taxation
As at 30 June 2019
Assets and liabilities
Segment assets
Total assets
Segment liabilities
Total liabilities
Other segment information
Capital expenditure
Depreciation
Amortisation
Impairment
3
Net finance costs
Finance income
Finance costs
250
4,945
5,195
(15,500)
-
(15,500)
(930,087)
(2,334,220)
(3,264,307)
-
-
-
(930,087)
(2,334,220)
(3,264,307)
UK
£
Australia
£
Total
£
2,275,468
2,677,907
4,953,375
2,275,468
2,677,907
4,953,375
(255,510)
(374,859)
(630,369)
(255,510)
(374,859)
(630,369)
-
-
-
-
929,338
37,131
-
929,338
37,131
-
18,450
18,450
2020
£
17,663
(21,734)
(4,071)
2019
£
5,195
(15,500)
(10,305)
50
Notes to financial statements
for the year ended 30 June 2020, continued
4
Expenses by Nature
Loss on ordinary activities before taxation is stated after charging:
Auditors’ remuneration – audit
Depreciation
Amortisation
Impairment charge
Directors’ emoluments
Greatland Gold plc
Company number: 5625107
2020
£
17,000
67,396
65,230
38,376
2019
£
16,200
37,131
-
18,450
1,089,226
962,406
Services provided by the Company’s auditor and its associates
During the period, the Group (including overseas subsidiaries) obtained the following services from
the Company’s auditors and its associates:
Fees payable to the Company’s auditor and its associates for the audit
of the Company and Group Financial Statements
2020
£
2019
£
17,000
16,200
Auditors’ remuneration for audit services above excludes AU$9,950 (2019: AU$7,814) charged by
Charles Foti Business Services (Australia) relating to the audit of the subsidiary company.
5
Taxation
Analysis of charge in year
Tax on profit on ordinary activities
Factors affecting tax charge for year
2020
2019
£
-
£
-
The tax assessed on the loss on ordinary activities for the period differs from the standard rate of
corporation tax in the UK of 19% (2018: 19%) and Australia of 27.5%. The differences are explained
below:
2020
£
2019
£
Loss on ordinary activities before tax
(5,144,995)
(3,264,307)
Loss multiplied by weighted average applicable rate of tax
(1,196,211)
(758,951)
Effects of:
Expenses not deductible for tax:
Share option charge
35,920
57,714
Tax losses on which no deferred tax asset is recognised
1,160,291
701,237
Income tax expense
-
-
51
Greatland Gold plc
Company number: 5625107
Notes to financial statements
for the year ended 30 June 2020, continued
5
Taxation, continued
The weighted average applicable tax rate of 23.25% (2019: 23.25%) used is a combination of the
standard rate of corporation tax rate for entities in the United Kingdom of 19% (2019: 19%), and
27.5% (2019: 27.5%) in Australia.
No deferred tax asset has been recognised because there is insufficient evidence of the timing of
suitable future profits against which they can be recovered.
Losses carried forward:
Brought forward losses 30 June 2019
Current year losses
Losses carried forward 30 June 2020
6
Employee information (excluding directors)
Staff costs comprised:
Wages and salaries
Bonus
Pension
Share option charge
Exploration
Administration
12,072,653
8,950,444
5,000,805
3,122,209
17,073,458
12,072,653
2020
£
502,172
151,613
57,624
62,777
774,186
Number
6
2
2019
£
195,139
23,798
15,220
58,471
292,628
Number
2
1
Of the total Staff costs in the year, £669,759 (2019: £229,773) arises from work on the Exploration
Properties and has been expensed to the Income Statement as exploration costs.
7
Dividends
No dividends were paid or proposed by the Directors. (2019: £Nil)
52
Notes to financial statements
for the year ended 30 June 2020, continued
8
Directors’ emoluments
Directors’ remuneration
Share option charge
Greatland Gold plc
Company number: 5625107
2020
£
997,511
91,715
2019
£
787,116
175,290
1,089,226
962,406
2020
Executive directors
Callum Baxter
Gervaise Heddle
Non-executive directors
Alex Borrelli
Clive Latcham
Directors’
salary
Pension
Bonus
Share Based
Payments
Total
£
£
£
£
£
185,024
185,024
44,278
44,278
205,121
205,121
30,015
30,015
464,438
464,438
43,750
33,750
1,165
-
25,000
25,000
3,159
28,526
73,074
87,276
447,548
89,721
460,242
91,715
1,089,226
Of the total Directors’ emoluments disclosed above in the income statement, 75% (or £348,329) for
Callum Baxter and 25% (or £116,110) for Gervaise Heddle has been allocated to exploration costs in
the income statement for the year. Directors remuneration and bonus relates to short term employee
benefits. Pension / superannuation payments relate to long term employee benefits.
Share based payments reflect the Black Scholes value of share options granted during the year. See
Note 17.
Also, see Note 22 for related party transactions.
2019
Executive directors
Callum Baxter
Gervaise Heddle
Non-executive directors
Alex Borrelli
Clive Latcham (appointed
15 October 2018)
Directors’
salary
Pension
Bonus Share Based
Payments
Total
£
£
£
£
£
166,944
166,944
30,826
30,826
144,736
144,736
75,893
75,893
418,399
418,399
40,000
21,319
785
-
20,000
20,000
13,552
9,952
74,337
51,271
395,207
62,437
329,472
175,290
962,406
Of the total Directors’ remuneration disclosed above in the income statement, 75% (or £256,879) for
Callum Baxter and 25% (or £85,626) for Gervaise Heddle has been allocated to exploration costs in
the income statement for the year. Directors remuneration and bonus relates to short term employee
benefits. Pension / superannuation payments relate to long term employee benefits.
53
Greatland Gold plc
Company number: 5625107
Notes to financial statements
for the year ended 30 June 2020, continued
8
Directors’ emoluments, continued
The aggregate gains made on the exercise of options during the year was £5,357,450 (2019: £1,150,600)
Share based payments reflect the Black Scholes value of share options granted during the year. See Note
17.
Also, see Note 22 for related party transactions.
9
Earnings per share
The basic earnings per share is derived by dividing the loss / profit for the period attributable to ordinary
shareholders by the weighted average number of shares in issue.
Loss for the period
2020
£
2019
£
(5,144,995)
(3,264,307)
Weighted average number of Ordinary shares of £0.001
in issue
3,593,407,809
3,252,941,141
Loss per share – basic
(0.14) pence
(0.10) pence
An inclusion of the potential Ordinary shares would result in a decrease in the loss per share, they are
considered to be anti-dilutive; as such, a diluted earnings per share is not included.
If the 204,500,000 outstanding options at 30 June 2020 (2019: 213,500,000) were included to calculate
the diluted loss per share.
Weighted average number of Ordinary shares of £0.001
in issue inclusive of outstanding options
3,797,907,809
3,466,441,141
Loss per share - diluted
(0.14) pence
(0.09) pence
54
Foreign exchange rate fluctuations
256
545
Notes to financial statements
for the year ended 30 June 2020, continued
10
Tangible fixed assets – Group
Cost
At 30 June 2019
Disposals
Additions
Foreign exchange rate fluctuations
At 30 June 2020
Depreciation
At 30 June 2019
Disposals
Charge
At 30 June 2020
Net book value
At 30 June 2020
At 30 June 2019
Cost
At 30 June 2018
Disposals
Additions
Foreign exchange rate fluctuations
At 30 June 2019
Depreciation
At 30 June 2018
Disposals
Charge
Greatland Gold plc
Company number: 5625107
Motor
vehicle
£
33,310
-
83,892
344
Equipment
£
113,863
-
5,411
1,177
Leasehold
Improvements
£
-
-
Total
£
147,173
-
6,320
95,623
-
1,521
117,546
120,451
6,320
244,317
5,126
38,933
-
-
39,573
27,816
44,955
67,294
-
-
7
-
7
44,059
-
67,396
801
112,256
72,591
28,184
53,157
74,930
6,313
132,061
-
103,114
Motor
vehicle
£
-
-
33,310
-
Equipment
£
49,267
-
65,464
(868)
33,310
113,863
-
-
7,390
-
5,174
31,957
Leasehold
Improvements
£
-
-
-
-
-
-
-
-
-
-
-
-
Total
£
49,267
-
98,774
(868)
147,173
7,390
-
37,131
(462)
44,059
103,114
41,877
Foreign exchange rate fluctuations
(48)
(414)
At 30 June 2019
Net book value
At 30 June 2019
At 30 June 2018
5,126
38,933
28,184
-
74,930
41,877
55
Notes to financial statements
for the year ended 30 June 2020, continued
11
Intangible non-current assets – Group
Exploration properties
At 30 June 2019
Additions
Impairment
Foreign exchange rate fluctuations
At 30 June 2020
Impairment
At 30 June 2019
Charge
Foreign exchange rate fluctuations
At 30 June 2020
Net book amount
At 30 June 2020
At 30 June 2019
Impairment review
Greatland Gold plc
Company number: 5625107
2020
£
2,647,577
-
(38,376)
10,956
2,620,157
2019
£
1,864,442
830,563
(18,450)
(28,978)
2,647,577
(630,794)
(630,794)
-
-
-
-
(630,794)
(630,794)
1,989,363
2,016,783
2,016,783
1,233,648
As at 30 June 2020, the Directors carried out an impairment review of the exploration properties and
considered an impairment charge was not required (2019: £nil). However, during the year £3,365,893 (2019:
£2,295,560) of exploration related costs have been charged directly to the Income Statement as these costs
were deemed non-beneficial to the future value of the exploration properties. Costs directly related to
exploration programmes that, in the opinion of the Directors, are considered to add value to the respective
exploration properties are capitalised.
12
Right of use asset
Group
Company
2020
2019
£
£
2020
£
2019
£
Properties
Opening balance on adoption of IFRS 16
Accumulated amortisation
At 30 June 2020
479,846
(65,230)
414,616
-
-
-
100,532
(25,133)
75,399
-
-
-
In December 2018 Greatland Pty Ltd entered into a lease agreement with Bondall Pty Ltd for office premises.
The initial term of the lease is 5 years, expiring on 30 November 2023. The Company has the option to extend
the lease for a further 5 year term, expiring on 30 November 2028.
In December 2018 Greatland Gold plc entered into a lease agreement with The Argyll Club (formerly London
Executive Offices) for offices premises. The initial term of the lease was 24 months, expiring on 30 November
2020. The Company has extended the lease for a further 24 month terms, expiring on 30 November 2022.
The current lease liability relates to the rental and interest payments due for current period to 30 November
2019 and the non-current lease liability relates to the rental and interest payments up to and including the
periods to 30 November 2028.
56
Notes to financial statements
for the year ended 30 June 2020, continued
13
Investments in subsidiary - Company
Cost
At 30 June 2019
Impairment of investment
At 30 June 2020
Net book amount
At 30 June 2020
At 30 June 2019
Greatland Gold plc
Company number: 5625107
£
50,000
-
50,000
50,000
50,000
The parent company of the Group holds more than 20% of the share capital of the following company:
Company
Country of
registration
Class
Proportion
held
Nature of business
Greatland Pty Ltd
Australia
Common
100%
Mineral exploration
The registered address of Greatland Pty Ltd is Unit B9, 431 Roberts Road, Subiaco, WA, 6008
14
Trade and other receivables
Group
Company
Current trade and other receivables:
Prepayments
Other debtors
Loans due from subsidiary
2020
£
55,211
23,865
-
2019
£
51,104
26,376
2020
£
2019
£
41,011
28,198
-
-
-
11,346,748
6,596,748
Total current trade and other receivables
79,076
77,480
11,387,759
6,624,946
The loan due from subsidiary was interest free throughout the period and has no fixed repayment date. No
provision £nil (2019: £nil) has been made against this loan.
57
Greatland Gold plc
Company number: 5625107
Notes to financial statements
for the year ended 30 June 2020, continued
15
Trade and other payables
Group
Company
Current trade and other payables:
Trade creditors
Accruals
Salaries and social security
Employee benefits
Lease liability
2020
£
668,514
64,481
29,700
114,015
56,049
2019
£
356,282
209,016
10,577
54,494
2020
£
73,344
64,481
29,700
511
-
24,440
2019
£
35,010
209,016
10,577
907
-
Total current trade and other payables
932,759
630,369
192,476
255,510
Group
Company
2020
£
2019
£
2020
£
2019
£
Non-current trade and other payables:
Employee benefits
Lease liability
Total non-current trade and other payables:
34,592
356,126
390,718
-
-
-
-
37,506
37,506
-
-
-
Total trade and other payables
1,323,477
630,369
229,982
255,510
Current employee benefits relate to annual leave and non-current benefits relates to long service leave.
58
Greatland Gold plc
Company number: 5625107
Notes to financial statements
for the year ended 30 June 2020, continued
16
Share capital
Called up, allotted, issued and fully paid
Number
Cost of share
issue
As at 30 June 2019, Ordinary shares of £0.001 each
Issued during the year
On 12 August 2019, at a price of £0.0185, for cash
On 26 September 2019, at a price of £0.0028, for cash
On 02 March 2020, at a price of £0.0250, for cash
On 01 April 2020, at a price of £0.0250, for cash
On 01 May 2020, at a price of £0.0250, for cash
On 19 May 2020, at a price of £0.007, for cash
On 22 May 2020, at a price of £0.014, for cash
On 01 June 2020, at a price of £0.0250, for cash
On 16 June 2020, at a price of £0.014, for cash
On 16 June 2020, at a price of £0.007, for cash
On 30 June 2020, at a price of £0.0250, for cash
As at 30 June 2020, Ordinary shares of £0.001p each
3,323,420,145
225,813,513
28,000,000
75,037,838
2,243,243
16,377,027
17,500,000
6,000,000
10,412,163
14,000,000
17,500,000
23,902,702
3,760,206,631
£
£
3,323,420
-
-
-
(128,340)
(3,837)
(28,010)
-
-
(17,809)
-
-
(40,882)
(218,878)
225,814
28,000
75,038
2,243
16,377
17,500
6,000
10,412
14,000
17,500
23,903
3,760,207
Total share options in issue
As at 30 June 2020 there were 204.5 million unexercised options over Ordinary shares; 25 million exercisable at
0.2 pence per share in issue, 14 million exercisable at 0.28 pence per share in issue, 12.5 million exercisable at
0.7 pence per share in issue, 19.5 million exercisable at 1.4 pence per share in issue, 39.5 million exercisable at
2 pence per share in issue, 20 million exercisable at 2.5 pence per share in issue, 37 million exercisable at 2.5
pence per share in issue and 37 million exercisable at 3.0 pence per share in issue (2019: 213.5 million).
Total warrants in issue
On 3 September 2019 the 11,363,636 warrants issued to DDH1 expired. In respect of these expired warrants
the share based payment charge of £14,200 was transferred to reserves.
As at 30 June 2020 there were 97,840,540 million unexercised investor warrants over Ordinary shares at 2.5
pence outstanding. Since the year end a further 60,063,511 warrants over Ordinary shares at 2.5 pence were
exercised. The remaining unexercised warrants expire on 27 August 2021.
No expense was recorded in the year in respect of these warrants.
59
Greatland Gold plc
Company number: 5625107
Notes to financial statements
for the year ended 30 June 2020, continued
17
Share based payments
The Company grants share options to employees as part of the remuneration of key management personnel and
directors to enable them to purchase ordinary shares in the Company. Under the plan, 74 million options were
granted for no cash consideration; 64 million options were granted for a period of three years expiring on 25
September 2023 and 10 million options were granted for a period of three years expiring on 07 January 2024. The
share options outstanding at 30 June 2020 had a weighted average remaining contractual life of 2.4 years (2019: 2.9
years). Maximum term of new options granted was 4 years from the grant date. The weighted average exercise
price of share options as at the date of exercise is £0.0073 (2019: £0.0035). The share options outstanding at 30
June 2020 had a range of exercise prices between £0.0020 and £0.0300.
Granted during
the period
Unexercised at
30 June 2019
Share options
exercised
Unexercised at
30 June 2020
Exercise price
(pence)
Date from which
exercisable
Expiry
date
14,000,000
0.28p
18 Jan 2017
18 Jul 2022
-
-
-
-
-
-
-
-
-
-
-
-
-
-
C Baxter
C Baxter
C Baxter
C Baxter
C Baxter
A Borrelli
A Borrelli
A Borrelli
A Borrelli
A Borrelli
G Heddle
G Heddle
G Heddle
G Heddle
G Cryan
G Cryan
G Cryan
G Cryan
G Cryan
B Wasse
B Wasse
B Wasse
B Wasse
17,500,000
(17,500,000)
-
9,000,000
9,000,000
-
-
14,000,000
14,000,000
25,000,000
14,000,000
7,500,000
2,500,000
2,500,000
-
-
-
-
-
-
-
-
-
14,000,000
14,000,000
9,000,000
9,000,000
25,000,000
7,500,000
2,500,000
2,500,000
28,000,000
(28,000,000)
17,500,000
(17,500,000)
-
-
14,000,000
-
14,000,000
14,000,000
(14,000,000)
-
6,000,000
(6,000,000)
-
6,000,000
G Heddle
9,000,000
G Heddle
9,000,000
-
-
-
-
-
5,000,000
3,000,000
3,000,000
1,500,000
1,500,000
-
-
3,000,000
-
3,000,000
C Latcham
-
10,000,000
C Latcham
1,500,000
C Latcham
1,500,000
-
-
M Sawyer
-
10,000,000
M Sawyer
3,000,000
M Sawyer
3,000,000
T Harris
T Harris
J Janik
J Janik
5,000,000
5,000,000
5,000,000
5,000,000
-
-
-
-
-
-
-
-
-
-
-
-
-
9,000,000
9,000,000
5,000,000
3,000,000
3,000,000
1,500,000
1,500,000
-
-
-
-
-
-
-
-
-
-
-
-
-
6,000,000
3,000,000
3,000,000
10,000,000
1,500,000
1,500,000
10,000,000
3,000,000
3,000,000
5,000,000
5,000,000
5,000,000
5,000,000
74,000,000
213,500,000
(83,000,000)
204,500,000
60
0.7p
1.4p
2.0p
2.5p
3.0p
0.2p
18 Aug 2017
16 Feb 2021
07 Sep 2019
06 Sep 2022
07 Sep 2019
06 Sep 2022
26 Sep 2020
25 Sep 2023
26 Sep 2020
25 Sep 2023
20 Apr 2016
20 Apr 2021
0.7p
1.4p
2.0p
0.28p
0.7p
1.4p
2.0p
2.5p
3.0p
0.7p
1.4p
2.0p
2.5p
3.0p
1.4p
2.0p
2.5p
3.0p
2.5p
2.5p
3.0p
2.5p
2.5p
3.0p
2.5p
3.0p
2.5p
3.0p
18 Aug 2017
16 Feb 2021
07 Sep 2019
06 Sep 2022
07 Sep 2019
06 Sep 2022
18 Jan 2017
18 Jul 2020
18 Aug 2017
16 Feb 2021
07 Sep 2019
06 Sep 2022
07 Sep 2019
06 Sep 2022
26 Sep 2020
25 Sep 2023
26 Sep 2020
25 Sep 2023
18 Aug 2017
16 Feb 2021
07 Sep 2019
06 Sep 2022
07 Sep 2019
06 Sep 2022
26 Sep 2020
25 Sep 2023
26 Sep 2020
25 Sep 2023
07 Sep 2019
06 Sep 2022
07 Sep 2019
06 Sep 2022
26 Sep 2020
25 Sep 2023
26 Sep 2020
25 Sep 2023
21 Mar 2020
20 Mar 2023
26 Sep 2020
25 Sep 2023
26 Sep 2020
25 Sep 2023
21 Mar 2020
20 Mar 2023
26 Sep 2020
25 Sep 2023
26 Sep 2020
25 Sep 2023
26 Sep 2020
25 Sep 2023
26 Sep 2020
25 Sep 2023
08 Jan 2021
07 Jan 2024
08 Jan 2021
07 Jan 2024
Greatland Gold plc
Company number: 5625107
Notes to the financial statements
for the year ended 30 June 2020, continued
17 Share based payments, continued
The fair value of the 64 million options granted on 26 September 2019 using an adjusted Black-Scholes method
and assumptions were as follows:
Options issued
Grant date
Fair value at measurement date
Share price at grant date
Exercise price
Expected volatility
32 million share options
32 million share options
26 September 2019
26 September 2019
0.187 pence
1.77 pence
2.5 pence
32%
0.114 pence
1.77 pence
3.0 pence
32%
Vesting period: 1 year after grant
26 September 2020
26 September 2020
Option life
Expected dividends
Risk free interest rate
Discount
Fair value of options granted
36 months
36 months
0.00%
0.50%
40%
£35,836
0.00%
0.50%
40%
£21,851
The fair value of the 10 million options granted on 08 January 2020 using an adjusted Black-Scholes method and
assumptions were as follows:
Options issued
Grant date
Fair value at measurement date
Share price at grant date
Exercise price
Expected volatility
5 million share options
5 million share options
08 January 2020
08 January 2020
0.328 pence
2.04 pence
2.5 pence
33%
0.220 pence
2.04 pence
3.0 pence
33%
Vesting period: 1 year after grant
08 January 2021
08 January 2021
Option life
Expected dividends
Risk free interest rate
Discount
Fair value of options granted
36 months
36 months
0.00%
0.50%
40%
£9,842
0.00%
0.50%
40%
£6,598
The fair value of the share options expensed during the year was £154,492, being the value of the options
attributable to the vesting period to 30 June 2020 (2019: £234,032). £8,265 and £14,229 will be expensed in the
following years, being the value of these options attributable to the end of their vesting dates. £116,945 in respect
of the exercised share options was transferred to reserves (2019: £142,098).
The volatility is set by reference to the historic volatility of the share price of the Company.
61
Notes to the financial statements
for the year ended 30 June 2020, continued
18 Cash and cash equivalents – Group
Cash at bank and in hand
Total cash and cash equivalents
Cash and cash equivalents – Company
Cash at bank and in hand
Total cash and cash equivalents
Greatland Gold plc
Company number: 5625107
30 June 2020
£
Currency
adjustments
£
Net Cash
flow
£
30 June 2019
£
6,022,745
6,022,745
189,314
3,077,433
2,755,998
189,314
3,077,433
2,755,998
30 June 2020
£
4,257,920
4,257,920
Currency
adjustments
£
-
Net Cash
flow
£
2,010,649
30 June 2019
£
2,247,271
-
2,010,649
2,247,271
Cash at bank earns interest at floating rates based on daily bank deposit rates.
Short-term deposits are made for varying periods of between one day and three months, depending on the immediate
cash requirements of the Group, and earn interest at the respective short-term deposit rates.
19 Commitments
As at 30 June 2020, the Company had entered into the following commitment:
Exploration commitments
Ongoing exploration expenditure is required to maintain title to the Group mineral exploration permits. No
provision has been made in the financial statements for these amounts as the expenditure is expected to be fulfilled
in the normal course of the operations of the Group.
Lease liability
In December 2018 Greatland Pty Ltd entered into a lease agreement with Bondall Pty Ltd for office premises. The
initial term of the lease is 5 years, expiring on 30 November 2023. The Company has the option to extend the lease
for a further 5 year term, expiring on 30 November 2028.
In December 2018 Greatland Gold plc entered into a lease agreement with The Argyll Club (formerly London
Executive Offices for offices premises. The initial term of the lease was 24 months, expiring on 30 November 2020.
The Company has extended the lease for a further 24 month terms, expiring on 30 November 2022
The current lease liability relates to the rental and interest payments due for current period to 30 November 2019
and the non-current lease liability relates to the rental and interest payments up to and including the periods to 30
November 2028.
Lease payments payable:
Current (< 1 year)
2-5 years
> 5 years
Group
2020
£
Group Company
2020
£
2019
£
Company
2019
£
56,049
234,429
121,697
412,175
13,045
-
-
13,045
24,440
37,506
-
61,946
13,045
-
-
13,045
62
Greatland Gold plc
Company number: 5625107
Notes to the financial statements
for the year ended 30 June 2020, continued
20 Significant agreements and transactions
On 8 June 2020, Greatland signed a series of agreements in relation to the Havieron project variously between
Newcrest Operations Limited ("Newcrest"), Western Desert Lands Aboriginal Corporation (Jamukurnu-
Yapalikunu), the Prescribed Body Corporate for the Martu People of the Central Western Desert region in Western
Australia ("WDLAC"), Greatland Gold plc ("Greatland") and Greatland Pty Ltd ("GPL") to assist in the process
for a Mining Lease application.
There were no other significant agreements and transactions to report other than those reported in Note 21.
21
Events after the reporting period
Post-Balance Sheet Capital Raises and issue of options
On 2 July 2020 the Company received a binding option exercise notice from Callum Baxter for 14,000,000 options
at 1.4 pence per share for a total consideration of £196,000.
On 24 July 2020 the Company received a binding option exercise notice from Gervaise Heddle for 5,000,000
options at 2.0 pence per share for a total consideration of £100,000.
On 29 July 2020 the Company received a binding option exercise notice from Clive Latcham for 1,250,000 options
at 2.5 pence per share for a total consideration of £31,250.
On 4 August 2020 the Company announced that during July 2020, it had issued 1,591,893 new ordinary shares of
0.1p each from its block listing authority of 10 February 2020 for a total consideration of £37,797.
On 1 September 2020 the Company announced that during August 2020, it had issued 11,891,892 new ordinary
shares of 0.1p each from its block listing authority of 10 February 2020 for a total consideration of £297,297.
On 25 September 2020 the Company received binding option exercise notices from employees for 2,500,000
options at 0.7 pence per share for a total consideration of £17,500 and 6,000,000 options at 2.0 pence per share for
a total consideration of £120,000.
On 28 September 2020 the Company received binding option exercise notices from employees for 13,000,000
options at 2.5 pence per share for a total consideration of £325,000 and 5,000,000 options at 3.0 pence per share
for a total consideration of £150,000.
On 29 September 2020 the Company received binding option exercise notices from an employee for 3,000,000
options at 2.5 pence per share for a total consideration of £75,000 and 3,000,000 options at 3.0 pence per share for
a total consideration of £90,000.
On 1 October 2020 the Company announced that during September 2020, it had issued 32,816,214 new ordinary
shares of 0.1p each from its block listing authority of 10 February 2020 for a total consideration of £820,405.
On 2 November 2020 the Company announced that during October 2020, it had issued 13,763,512 new ordinary
shares of 0.1p each from its block listing authority of 10 February 2020 for a total consideration of £344,088.
Corporate
On 30 July 2020 the Company announced that it had appointed Berenberg and H&P Partners as joint corporate
brokers and financial advisers to the company with immediate effect.
On 27 August 2020 the Company announced that it had appointed PKF Littlejohn LLP as auditors to the Company
with immediate effect.
On 10 September 2020, the Western Australian Department of Mines, Industry Regulation and Safety (“DMIRS”)
has granted Mining Lease application 45/1287 for the Havieron gold-copper deposit. The Mining Lease covers the
12 block area that is subject to the Farm-in Agreement between Greatland and Newcrest dated 12 March 2019.
63
Greatland Gold plc
Company number: 5625107
Notes to the financial statements
for the year ended 30 June 2020, continued
22 Related party transactions
Remuneration of key management personnel
The remuneration of the directors, and other key management personnel of the Group, is set out below in aggregate
for each of the categories specified in IAS24 Related Party Disclosures.
Short-term employee benefits
Share based payments
Key management personnel
23 Financial instruments – Group
2020
£
997,511
154,492
711,409
2019
£
787,116
233,761
234,157
1,863,412
1,255,034
The Group uses financial instruments comprising cash, liquid resources and debtors/creditors that arise from its
operations.
Group
2020
£
Group Company Company
2019
£
2020
£
2019
£
Financial assets at amortised cost
Trade and other receivables excluding prepayments
Cash and cash equivalents
Financial liabilities
Trade and other payables (at amortised cost)
Lease liabilities (current and non-current)
38,065
6,022,745
6,060,810
49,282
2,755,998
2,805,280
-
4,257,920
4,257,920
-
2,247,271
2,247,271
911,301
412,175
1,323,476
630,368
-
630,368
168,036
61,946
229,982
255,510
-
255,510
The Group’s exposure to currency and liquidity risk is not considered significant. The Group’s cash balances are
held in Pound Sterling and in Australian dollars, the latter being the currency in which the significant operating
expenses are incurred. To date the Group has relied upon equity funding to finance operations. The Directors are
confident that adequate cash resources exist to finance operations to commercial exploitation, but controls over
expenditure are carefully managed.
The net fair value of financial assets and liabilities approximates the carrying values disclosed in the financial
statements. The currency of the financial assets is as follows:
Cash and short term deposits
30 June 2020
30 June 2019
Sterling
Australian Dollars
At 30 June 2020
The financial assets comprise interest earning bank deposits.
24 Contingent liabilities
Acquisition of Havieron Project
£
4,257,920
1,764,825
6,022,745
£
2,247,271
508,727
2,755,998
Under the terms of the agreement for the acquisition of the Havieron Gold Project an initial payment of A$25,000
in cash and 65,490,000 ordinary shares of 0.1 pence each in the Company were made. However, a second payment
of 145,530,000 ordinary shares of 0.1 pence each will be made upon a “Decision to Mine”.
25 Ultimate Controlling Party
There is considered to be no ultimate controlling entity.
64