HAVILAH RESOURCES LIMITED
ABN 39 077 435 520
ANNUAL REPORT
2021
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
Contents
About Havilah
Letter from the Board of Directors
Directors’ Report
Auditor’s Independence Declaration to the Directors of Havilah Resources Limited
Consolidated Financial Statements and Notes
Directors’ Declaration
Independent Auditor’s Report to the Members of Havilah Resources Limited
Additional Securities Exchange Information
Tenement Schedule as at 31 July 2021
Glossary
Page
2
4
5
28
29
59
60
63
65
67
Forward-looking Statements
This Annual Report prepared by Havilah Resources Limited includes forward-looking statements. Forward-
looking statements may be identified by the use of ‘may’, ‘will’, ‘expect(s)’, ‘intend(s)’, ‘plan(s)’, ‘estimate(s)’,
‘anticipate(s)’, ‘continue(s)’, and ‘guidance’, or other similar words and may include, without limitation,
statements regarding plans, strategies and objectives of management, anticipated production or construction
commencement dates and expected costs of production.
Forward-looking statements inherently involve known and unknown risks, uncertainties and other factors that
may cause the Group’s actual results, performance and achievements to differ materially from any future
results, performance or achievements. Relevant factors may include, but are not limited to, changes in
commodity prices, foreign exchange fluctuations and general economic conditions, increased costs and demand
for production inputs, the speculative nature of exploration and project development, including the risks of
obtaining necessary licences and permits and diminishing quantities or grades of reserves, political and social
risks, changes to the regulatory framework within which the Group operates or may in the future operate,
environmental conditions including extreme weather conditions, recruitment and retention of personnel,
industrial relations issues and litigation.
Forward-looking statements are based on the Group and its management’s good faith assumptions relating to
the financial, market, regulatory and other relevant environments that will exist and affect the Group’s business
and operations in the future. The Group does not give any assurance that the assumptions on which forward-
looking statements are based will prove to be correct, or that the Group’s business or operations will not be
affected in any material manner by these or other factors not foreseen or foreseeable by the Group or
management or beyond the Group’s control. Given the ongoing uncertainty relating to the duration and extent of
the COVID-19 pandemic, and the impact it may have on the demand and price for commodities (including
copper and gold), on our suppliers and workforce, and on global financial markets, the Group continues to face
uncertainties that may impact on its operating activities, financing activities and/or financial results.
Although the Group attempts and has attempted to identify factors that would cause actual actions, events or
results to differ materially from those disclosed in forward-looking statements, there may be other factors that
could cause actual results, performance, achievements or events not to be as anticipated, estimated or
intended, and many events are beyond the reasonable control of the Group. Accordingly, readers are cautioned
not to place undue reliance on forward-looking statements. Forward-looking statements in this Annual Report
speak only at the date of issue. Subject to any continuing obligations under applicable law or the ASX Listing
Rules, in providing this information the Group does not undertake any obligation to publicly update or revise any
of the forward-looking statements or to advise of any change in events, conditions or circumstances on which
any such statement is based.
Cover: Stages 1, 2 and 3 of the conceptual West Kalkaroo gold open pit. The optimised Stage 3 open pit design is
estimated to contain 80,000-90,000 ounces of gold and 5,000 tonnes of native copper. Mining is planned to commence
during 2022, subject to a final investment decision by the Havilah Board of Directors, which is contingent on securing
financing and receipt of final South Australian government approvals and other factors.
Page 1
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
ABOUT HAVILAH
Key Strengths
• Advanced stage multi-commodity mineral portfolio located in northeastern South Australia, near Broken Hill.
• Successful exploration discovery track record combined with a large contiguous ground position in the highly
prospective but under-explored Curnamona Craton that is also host to the giant Broken Hill orebody.
Key Assets and Attributes
Copper–gold–cobalt
• Kalkaroo: Positive independent pre-feasibility study (‘PFS’) confirms Kalkaroo as one of the largest
undeveloped open pit copper-gold deposits in Australia, based on a 100.1 million tonne JORC Ore Reserve
(90% Proved) at a copper equivalent grade of 0.89%.
• A large mineralised system, with mineralisation occurring in a variety of structural settings and rock types.
• Mutooroo: Comparatively high-grade open pit and underground copper deposit (1.53%) with appreciable
cobalt (20,200 tonnes). One of the largest sulphide cobalt deposits in Australia with associated copper.
• Considerable exploration discovery upside for resource expansion of both Kalkaroo and Mutooroo deposits
along strike, down-dip and in adjacent areas.
Iron ore
• Maldorky and Grants: Combined JORC Mineral Resource of 451 million tonnes of iron ore in close proximity
to the Barrier Highway and Transcontinental railway line to Port Augusta. With its high yields (40%) and
high iron recoveries (85%) the Maldorky iron ore is amenable to efficient upgrading to 65% Fe low impurity
product that could potentially be suitable for pelletising.
• Grants Basin: An Exploration Target* of 3.5-3.8 billion tonnes with a grade range of 24-28% Fe (applying an
18% iron assay cut-off grade) covering only 25% of the known iron ore basin area. Lies adjacent to the
Barrier Highway and Transcontinental railway line.
* Note that the potential quantity and grade of the Exploration Target is conceptual in nature, there has been
insufficient exploration to estimate a Mineral Resource and it is uncertain if further exploration will result in
the estimation of a Mineral Resource.
Conflict-free, strategic and/or critical minerals
• Rare earth element (‘REE’), molybdenum, tin and tungsten potential, in association with existing
JORC Mineral Resources for copper, gold, cobalt, iron ore and uranium oxide.
Exploration upside
• ~16,000 km2 of mineral tenements in the Curnamona Craton, covering some of the most prospective and
under-explored geological terrain in Australia for copper, gold, cobalt and iron ore. Refer to havilah-resources-
projects.com/exploration for further information.
Favourable logistics and infrastructure, low sovereign risk, Tier 1 mining jurisdiction1
• Located in northeastern South Australia in proximity to the Transcontinental railway line, Barrier Highway and
regional mining centre of Broken Hill with its skilled workforce. South Australia has a stable regulatory
environment, is a low sovereign risk jurisdiction, with a mining friendly government that actively encourages
mineral exploration and development. South Australia’s regulatory regime mandates the highest ESG
(environmental, social and governance) standards.
Experienced technical team
• Havilah’s current technical team has an exceptional track record of exploration success (including the
delineation of 8 JORC Mineral Resources) and has developed and previously operated the Portia gold mine.
Havilah operates its own drilling crew, which has been one of the keys to its cost-effective and successful
exploration.
Key Strategic Objectives
Havilah’s underlying objective that guides all of its activities is to maximise returns to shareholders via strategic
management of its multi-commodity mineral portfolio in South Australia, which is being achieved by:
• Progressively de-risking its advanced mineral projects to attract investment partners via farm-out or asset sale.
• New exploration discoveries on the large and highly prospective Curnamona Craton mineral tenement holding.
Key Risks
Section 10 of the Share Purchase Plan dated 20 November 2020 sets out key risks identified by the Board of
Directors as being specific to the Group and its operations and reasonably anticipated by the Board. It is
important to note that the risks listed are not an exhaustive list of the risks relevant to the Group.
1 South Australia was ranked 7th best jurisdiction for global investment attractiveness by the independent Fraser
Institute Annual Survey of Mining Companies 2020.
Page 2
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
Havilah’s deposit, prospect and tenement portfolio in northeastern South Australia, near Broken Hill.
Page 3
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
LETTER FROM THE BOARD OF DIRECTORS
Havilah’s focus over the last 12 months has been on progressing key tasks required to enable development of
the West Kalkaroo gold open pit. This has included completion of documentation that is required to obtain
South Australian government mining approvals, refining the mine and process plant designs and completion of a
financial model to help facilitate project financing. The current West Kalkaroo oxidised ore open pit is designed
to lead into the long-term, large-scale copper sulphide mining operation at the earliest opportunity, subject to
prevailing metal prices and availability of financing.
Havilah’s copper focus has been supported by the rise in the copper price over the last eighteen months, which
has pushed the Kalkaroo project’s pre-tax NPV7.5% well over $1.1 billion when long-term consensus US$ copper
and gold prices are applied in the original PFS financial model. Kalkaroo is a robust project, with a value multiple
many times higher than Havilah’s current market capitalisation. It is also one of the few large-scale open pit
copper-gold development opportunities presently available in Australia. The copper and gold combination in the
Kalkaroo project is advantageous, as these metals are normally natural hedges against each other – copper
being driven to a large extent by stable industrial production and economic development; and gold by
uncertainty and instability.
The trend towards renewable energy is beginning to accelerate as governments around the world move to
introduce regulations and mandates that target net-zero greenhouse gas emissions. As a consequence it is
likely that there will be a sustained upswing in the demand for a suite of green technology metals (including
copper, cobalt and REE), which are essential enablers of the clean energy transition. Copper is an obvious
winner because almost every piece of renewable energy equipment offers new uses for copper such as the
extensive cabling associated with solar panels, wind turbines and electric vehicles (‘EV’).
This comes at a time when copper supply in the medium to longer-term is forecast to be limited by declining
average ore grades, resource depletion, water constraints, insufficient investment in new mines, and a lack of
major new copper discoveries. New large-scale projects with the potential to help fill the forecast copper supply
gap are scarce, with some large overseas copper projects facing significant economic, political or environmental
challenges. Similar comments apply to cobalt and REE, although their uses are more limited than copper.
Havilah is ideally leveraged to benefit from a favourable commodities cycle with its two advanced copper-cobalt-
gold mineral projects (Kalkaroo and Mutooroo), along with its large and highly prospective 100% owned
exploration acreage. Havilah’s projects have the potential to supply metals the modern world needs longer-term,
including copper, cobalt, REE and molybdenum.
With new environmentally conscious consumers of metals there is increasing scrutiny of how the metals are
produced as measured by environmental, social and governance (‘ESG’) criteria. Havilah is exceptionally well
placed because of its ability to integrate plentiful renewable wind and solar energy sources into its development
planning. Havilah’s focus is on sustainable long-term environmental outcomes that minimise disturbance to the
natural environment, as far as practicable. Its conservation initiatives on the 550 km2 Kalkaroo Station that it
owns demonstrate strong commitment to this principle.
Despite hosting the giant lead-zinc-silver ore deposit at Broken Hill, much of the Curnamona Craton is under-
explored due to extensive sedimentary cover. The geological similarity of the Curnamona Craton to the eastern
Gawler Craton and the Mount Isa-Cloncurry Block indicates similar prospectivity for major ore deposits.
Accordingly, a key Board objective is to maintain an active program of exploration work on projects and
prospects that have the most potential for new discoveries. The string of excellent drilling results from Kalkaroo
and more recently from the Cockburn prospect near Mutooroo vindicates this strategy.
The Board remains committed to maximising returns to shareholders through judicious management of the
Group’s multi-commodity mineral portfolio in South Australia. The Board’s strategy is to maximise the fair value
of the Group’s mineral portfolio either by production, sale or farm-out with suitable well-funded partners.
The Board will not entertain any proposal that, in its view, does not assist Havilah to reach this goal.
We thank all shareholders, contractors and employees for their support and patience as we continue to strive to
realise the latent value in Havilah’s multi-commodity mineral portfolio for the benefit of all stakeholders.
Simon Gray, Victor Previn and Chris Giles
Page 4
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
DIRECTORS’ REPORT
The Directors present their report on Havilah Resources Limited and its subsidiaries (the ‘Group’) for the
financial year ended 31 July 2021 (the ‘financial year’). All monetary amounts are presented in Australian
dollars, unless otherwise indicated.
Havilah Resources Limited (‘Havilah’ or ‘Company’) is an Australian public company limited by shares and is
listed on the Australian Securities Exchange (‘ASX’).
Directors
The Directors of the Company at the date of this Directors’ Report are:
Mr Simon Gray (Executive Director – Chairman)
Mr Victor Previn (Independent Non-Executive Director)
Dr Christopher Giles (Executive Director – Technical Director)
Detailed below are the Directors who held office during or since the end of the financial year:
Mr Simon Gray B.Ec (Com) CA
Appointed 9 October 2019
Simon Gray has over 35 years' experience as a chartered accountant and 20 years as a Partner with
Grant Thornton, a national accounting firm. During his last 5 years at the firm, he was responsible for the
Grant Thornton Mining and Energy group. Simon retired from active practice during July 2015. His key expertise
lies in audit and risk, valuations, due diligence and ASX Listings. Simon currently serves as the Company
Secretary of Nova Eye Medical Limited (ASX: EYE), and Company Secretary and Chief Financial Officer of
Vintage Energy Ltd (ASX: VEN). Simon is also Chair of the Audit and Finance Committee of the Flinders
Medical Research Foundation and is a Director of several unlisted companies. Simon is a resident of Adelaide.
Special Responsibilities
Member of the Audit and Risk, Nomination, and Remuneration Committees.
Directorships of Other ASX Listed Entities during the Last 3 Years
None.
Havilah Shares and Share Options
158,823 fully paid ordinary shares (including his personally related parties).
40,000 unlisted employee share options each with an exercise price of $0.22 expiring on 11 July 2023.
Mr Victor Previn B.Eng
Appointed 9 October 2019
Victor Previn is a professional engineer and one of the original founders of Nova Eye Medical Limited (formerly
Ellex Medical Lasers Limited). It is listed on the ASX as EYE. His career spans more than 30 years in the laser
industry. Victor was responsible for developing and commercialising the technology platform that is now the
core of Nova Eye Medical Limited’s current production. He has spent more than 3 decades in the ophthalmic
laser industry travelling widely throughout Asia, Europe and the USA in a business development capacity.
Victor is a long-term shareholder of Havilah and resides in Adelaide.
Special Responsibilities
Chairman of the Audit and Risk, Nomination, and Remuneration Committees.
Directorships of Other ASX Listed Entities during the Last 3 Years
Nova Eye Medical Limited.
Havilah Ordinary Shares and Share Options
2,451,622 fully paid ordinary shares (including his personally related parties).
Page 5
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
DIRECTORS’ REPORT
Directors (continued)
Dr Christopher Giles B.Sc (Hons), PhD, MAIG
Appointed 11 February 1997
Chris Giles is an internationally experienced exploration geologist having been directly involved in exploration
programs resulting in the discovery of several operating gold mines in various parts of the world, including
Indonesia, Tanzania, and the Tanami and the Eastern Goldfields regions of Australia. Chris was a founding
member of Havilah Resources Limited and has played a key role in the strategic accumulation of the Group’s
mineral tenement holding in the Curnamona Craton region of northeastern South Australia. As the
Technical Director for Havilah Resources Limited, Chris has been responsible for ground selection and
overseeing exploration programs contributing to the delineation of 8 new mineral resources within this tenement
area, resulting in Havilah’s present JORC Mineral Resource inventory. Chris is an Executive Director and
continues to provide technical guidance within the business. Chris is a member of the Australian Institute of
Geoscientists and is a resident of Adelaide.
Special Responsibilities
Member of the Audit and Risk, Nomination, and Remuneration Committees.
Directorships of Other ASX Listed Entities during the Last 3 Years
None.
Havilah Shares and Share Options
42,033,909 fully paid ordinary shares (including his personally related parties).
2,400,000 unlisted share options each with an exercise price of $0.36 expiring on 12 December 2021.
Company Secretary
Mr Simon Gray. Appointed 25 January 2019.
Meetings of Directors
The following table sets out the number of Directors’ meetings (including meetings of committees of Directors)
held during the financial year and the number of meetings attended by each relevant Director (while they were a
Director or Committee Member).
Meeting
Board of Directors
Audit and Risk
Committee
Nomination
Committee
Remuneration
Committee
A
B
A
B
A
B
A
B
Director
Mr Simon Gray
Mr Victor Previn
9
9
9
9
3
3
3
3
1
1
1
1
Dr Christopher Giles
A. The number of meetings held during the time the Director held office during the financial year.
B. The number of meetings attended during the time the Director held office during the financial year.
1
3
9
3
9
1
1
1
1
1
1
1
Significant Changes in the State of Affairs
Contributed equity increased by $5,923,280 during the financial year as the result of the issue of ordinary shares
via share placements and a successful share purchase plan. Details of the changes in contributed equity are
disclosed in Note 18(b) to the consolidated financial statements.
Other than the matter noted above, no other significant changes in the state of affairs of the Group occurred
during the financial year.
Principal Activities
The principal activities of the Group during the financial year were exploration for and evaluation of mineral
resources (predominantly copper, gold, cobalt and iron ore) in South Australia and advancing the West Kalkaroo
gold open pit towards development. The objective is to translate exploration success into shareholder value by
developing the JORC Ore Reserves and Mineral Resources into profitable operating mines and/or via sale or
farm-out with suitable well-funded partners.
The Group’s activities during the financial year are outlined in the Review of Operations below.
Page 6
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
DIRECTORS’ REPORT
Business Strategies and Prospects, Likely Developments and Expected Results of Operations
The Review of Operations sets out information on the business strategies and prospects for future financial
years, refers to likely developments in operations and the expected results of those operations in future financial
years. Information in the Review of Operations is provided to enable shareholders to make an informed
assessment about the business strategies and prospects for future financial years of the Group. Other than the
matters included in this Directors’ Report or elsewhere in this Annual Report, information about other likely
developments in the Group’s operations and the expected results of those operations have not been included.
Details that could give rise to likely material detriment to Havilah, for example, information that is confidential,
commercially sensitive or could give a third party a commercial advantage has not been included.
Shares and Share Options
At the date of this Directors’ Report there are 306,277,228 ordinary shares and 20,256,874 unlisted share
options outstanding. Details of share options outstanding over unissued ordinary shares in the Company are as
follows:
Grant date
1 November 2018 (Investec 1)
12 December 2018 (Director 2)
20 December 2018 (Investec 1)
11 July 2019 (Employee 3)
11 July 2019 (Employee 3)
3 May 2021 (Employee 3)
Total
Number of share
options
Exercise price per
share option
Expiry date
5,000,000
2,400,000
2,500,000
2,950,646
3,006,228
4,400,000
20,256,874
$0.234
1 November 2021
$0.36
$0.22
$0.22
$0.28
$0.25
12 December 2021
20 December 2021
11 July 2023
11 July 2023
30 April 2024
1 Unlisted share options issued to Investec under a prior financial period funding agreement.
2 Unlisted share options issued to a Director (Dr Christopher Giles).
3 Unlisted share options issued to employees under the Company’s Performance Rights and Share Option Plan.
For details of share options issued to Directors and other key management personnel of the Group as
remuneration, refer to the Remuneration Report in this Directors’ Report.
Further details of the Performance Rights and Share Option Plan and share options granted during the current
and prior financial years are disclosed in Note 25 to the consolidated financial statements.
Dividends
No dividends were paid or declared since the start of the financial year, and the Directors do not recommend the
payment of dividends in respect of the financial year.
Indemnification of Directors, Officers and External Auditor
During the financial year the Group paid a premium in respect of a contract insuring Directors and officers of the
Group against a liability incurred as such by a Director or officer to the extent permitted by the Corporations Act
2001. The contract of insurance specifically prohibits disclosure of the nature of the liability and the amount of
the premium. The Company has entered into an agreement with Directors to indemnify these individuals against
any claims and related expenses which arise as a result of their work in their respective capacities.
The Group has not otherwise, during or since the end of the financial year, indemnified or agreed to indemnify
an officer or external auditor of the Group or of any related body corporate, against a liability, incurred as such
by an officer or external auditor.
Proceedings on Behalf of the Company
No person has applied to the Court under Section 237 of the Corporations Act 2001 for leave to bring
proceedings on behalf of the Group, or to intervene in any proceedings to which the Group is a party, for the
purpose of taking responsibility on behalf of the Group for all or part of those proceedings.
Matters Arising Subsequent to the End of the Financial Year
Other than the matters disclosed in Note 28 of the consolidated financial statements, there has been no matter
or circumstance that has arisen since the end of the financial year, that has significantly affected or may
significantly affect the operations of the Group, the results of those operations, or the state of affairs of the
Group in future financial years.
Page 7
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
DIRECTORS’ REPORT
Environmental Regulations
The Group carries out exploration and evaluation activities on its mineral exploration tenements and relevant
Kalkaroo mining leases in South Australia. The Group’s operations, exploration and evaluation activities are
subject to a range of South Australian and Commonwealth environmental legislation and associated regulations,
as well as site-specific environmental criteria. No material breaches of these compliance conditions occurred
during the financial year.
Environmental Sustainability
Havilah subscribes to the principle of sustainability across all of its operations. This includes minimising
disturbance to the natural environment to the maximum extent practicable and where possible, helping to
improve environmental outcomes through judicious conservation initiatives. Havilah practices this principle on
Kalkaroo Station, which it owns.
Kalkaroo Station is uniquely located in one of the most favourable places in Australia for combined wind and
solar power generation. It is Havilah’s ultimate goal to utilise these natural geographic advantages to maximise
the generation and use of renewable energy. Havilah recently commissioned its own pilot solar-wind-battery
power generation system at the Kalkaroo exploration basecamp. Transitioning to renewable power sources at
the Kalkaroo basecamp demonstrates the Group’s ongoing commitment to responsible resource development
across its operations and activities. Ultimately, it is Havilah’s ambition to design a renewable energy generation
system to power the Kalkaroo mine.
Copper is critical in almost every aspect of achieving renewable energy goals for the global economy.
By becoming a significant copper producer, Havilah expects to make a contribution to enabling this energy
transition.
Havilah’s ESG (environmental, social and governance) credentials can be found on the Company's website.
COVID-19 Pandemic
During March 2020, the World Health Organisation declared the outbreak of COVID-19 as a pandemic.
Given the ongoing uncertainty relating to the duration and extent of the COVID-19 pandemic, and the impact it
may have on the demand and price for commodities (including copper and gold), on our suppliers and
workforce, and on global financial markets, the Group continues to face uncertainties that may impact on its
operating activities, financing activities and/or financial results.
Havilah is abiding by all official directives, and continues to closely monitor the impacts of the COVID-19
pandemic on the health and wellbeing of its personnel, contractors and stakeholders. It has in place protocols
and response plans to minimise the potential transmission of COVID-19. However, there are no guarantees that
in the future further travel restrictions and border closings, stay-at-home and quarantine notices, or lockdowns
will not be imposed by government, as events continue to unfold relating to the COVID-19 pandemic, its variants
and available vaccines.
Since the Group’s tenements are in northeastern South Australia, it was able to continue drilling during the
financial year unimpeded by COVID-19 restrictions. The field team operates out of Havilah’s exploration
basecamp on Kalkaroo Station or hired premises at Cockburn, which are both remote and relatively isolated
locations, with minimal external contact.
Proceeds from capital raisings during November and December 2020 allowed restoration of budgets and work
programs for other key projects during 2021, to replace funds that had been diverted to West Kalkaroo during
2020 due to COVID-19 related issues that limited access to Havilah’s other project areas.
The COVID-19 pandemic continues to highlight to the Board the importance of regional supply chain security for
strategic and critical minerals (including copper, cobalt, REE, tin and tungsten) that are necessary for national
economic and security interests.
It is noted that key native title heritage surveys have in some cases been delayed by COVID-19 related
restrictions, which had prevented clearance of proposed exploration drilling sites and also delayed surveying of
the proposed West Kalkaroo mining site and infrastructure.
Page 8
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
DIRECTORS’ REPORT
Review of Operations
Kalkaroo Copper-Gold-Cobalt Project (HAV 100% ownership)
Kalkaroo is Havilah’s flagship mineral project, located approximately 400 kilometres (‘km’) northeast of Adelaide
and 90 km northwest of the regional mining centre of Broken Hill with its skilled mining workforce (see map on
page 3). It lies approximately 55 km north of the Transcontinental railway line and Barrier Highway. The project
comprises a 100.1 million tonne (‘Mt’) JORC Ore Reserve (Proved 90.2 Mt; Probable 9.9 Mt) at a copper
equivalent grade of 0.89% that is capable of supporting a large-scale open pit mining operation over at least
13 years. The Group has already secured the required mining permits for the Kalkaroo project (Mining Leases
and Miscellaneous Purposes Licences). It also owns the surrounding 550 km2 Kalkaroo Station pastoral lease,
a non-mineral asset on which the Kalkaroo project is located, thus reducing land access risks for the project.
The Board has a staged strategic plan to develop the Kalkaroo deposit, commencing with a lower capital
expenditure operation that initially focuses on mining the comparatively shallow and soft oxidised gold and
native copper ore at West Kalkaroo (Figure 1). The proposed West Kalkaroo gold open pit is located at the very
western (and upper) part of the Kalkaroo deposit, where it is planned to produce 80,000-90,000 ounces of gold
and 5,000 tonnes of native copper (near pure copper metal) over an initial 3-4 year period. This open pit design
has the flexibility for extension to the east for several more years in oxidised ore and ultimately to transition to
the much larger and longer-term Kalkaroo copper sulphide project.
The priority objective during the financial year was to progress the West Kalkaroo gold open pit permitting work,
feasibility study and financing options with the aim of advancing towards development during 2022.
Sterilisation holes were also completed in the vicinity of the planned locations of key infrastructure to ensure that
they will not be built too close to potentially economic mineralisation. Development go ahead is subject to a final
investment decision by the Havilah Board, which is contingent on several factors, including securing financing
and receipt of final South Australian government approvals.
Melbourne based process engineering firm, Mincore Pty Ltd, was contracted to assist with design of the process
flowsheet, and equipment selection for a modular fit-for-purpose processing plant for the soft, oxidised,
West Kalkaroo gold ore. Capital and operating cost inputs from this study applied in a financial model indicate
good investment returns that would be attractive to financiers. A reduced South Australian government royalty
rate of 2% for the first 5 years of production will assist the West Kalkaroo project economics.
During March 2021 the Kalkaroo Program for Environment Protection and Rehabilitation (‘PEPR’) document
was submitted to the Department for Energy and Mining (‘DEM’) for assessment and approval of the proposed
West Kalkaroo gold open pit. This document details the social and environmental impacts of the proposed
mining operation, risk mitigation strategies and mine closure plans (refer to ASX announcement of 15 March
2021). It was the culmination of many months of dedicated effort by Havilah’s staff and consultants during the
financial year. The PEPR is the final permitting approval required for go-ahead of the West Kalkaroo open pit
gold mine. The DEM has subsequently provided detailed feedback, which mostly relates to either clarification of
existing information or providing more detail surrounding aspects of the proposed mining operation. No critical
issues have to date been identified that would potentially prevent the West Kalkaroo project from proceeding.
At the present time, Havilah employees and consultants are preparing detailed responses and additional
information to satisfy the DEM’s requirements for approval.
Infill resource drilling along strike of the proposed West Kalkaroo gold open pit, to improve confidence in
continuity of mineralisation, continued during the financial year. Widespread copper and gold mineralisation was
intersected in most reverse circulation drillholes, with grades and widths of sulphide mineralisation typical of the
Kalkaroo deposit (refer to ASX announcement of 22 June 2021). This included long intervals of vein and breccia
style copper-gold mineralisation over at least 100 metres horizontal true width near the intersection of two major
faults, partially outside of the existing Kalkaroo resource (refer to ASX announcement of 16 September 2020, 14
October 2020 and 1 February 2021). There is substantial scope to materially increase resource tonnage in this
part of the deposit.
Although not specifically targeted, many of these drillholes also intersected appreciable gold mineralisation in
the shallower oxidised (saprolite gold) zone. These gold intersections will be followed up in due course with
more closely spaced, shallow aircore drilling prior to any future eastward extensions of the planned West
Kalkaroo gold open pit. In addition, close spaced aircore drilling continued to extend the base of Tertiary
horizontal gold mineralisation layer at West Kalkaroo (refer to ASX announcement of 10 August 2020).
This mineralisation is not included in the current Kalkaroo JORC gold resource and is potentially a source of
early-stage shallower gold that would be mined during removal of the overburden in the West Kalkaroo gold
open pit.
Page 9
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
DIRECTORS’ REPORT
Review of Operations (continued)
Kalkaroo Copper-Gold-Cobalt Project (HAV 100% ownership) (continued)
Four reverse circulation drillholes completed at East Kalkaroo also returned ore-grade drilling intercepts in highly
brecciated (fractured and broken) and veined host rocks within or adjacent to the Kalkaroo fault zone, in areas
marginal to the current Kalkaroo JORC Mineral Resource (refer to ASX announcement of 13 July 2021).
This mineralisation is known to continue to at least 500 metres depth based on an earlier MIM Exploration Ltd
2001 diamond drillhole (KMD001) in the near vicinity at East Kalkaroo, which intersected the widest and deepest
zone of primary copper-gold mineralisation ever drilled on the Kalkaroo deposit, with an intersection of
317.4 metres of 0.26% copper and 0.1 g/t gold from 316-633.4 metres (end of hole). These results highlight the
possibility of breccia-vein style copper-gold mineralisation below the current Kalkaroo JORC Mineral Resource
that may have bulk tonnage underground mining potential. Testing of this deep breccia-vein zone is beyond the
current depth capacity of the reverse circulation drilling rig operated by Havilah, and will be followed up in due
course by contract diamond drilling, subject to Havilah’s other work priorities.
Figure 1 Location of 2020 and 2021 resource confirmation drillholes. Also shown is the planned West Kalkaroo
gold open pit outline (blue), which is currently being advanced towards development. Conceptual Kalkaroo open
pit is also shown.
Page 10
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
DIRECTORS’ REPORT
Review of Operations (continued)
Kalkaroo Copper-Gold-Cobalt Project (HAV 100% ownership) (continued)
Substantial increases in long-term consensus US$ copper and gold prices used by the Group since the original
Kalkaroo project PFS was released (refer to ASX announcement of 18 June 2019) has resulted in more than
doubling of the Kalkaroo project pre-tax NPV7.5% to $1.163 billion applying the same PFS financial model (refer
to ASX announcement of 17 May 2021). At the time it was noted the Kalkaroo project net present value (‘NPV’)
was highly sensitive to copper and gold prices. This is evident via sensitivity analysis in a metal price vs NPV7.5%
value matrix reproduced in Table 1 below from the RPM Global Asia Limited PFS financial model.
Table 1 Pre-tax NPV7.5% value matrix in AUD million for variable USD copper and gold prices
Gold price USD/oz and AUD/oz (at AUD:USD exchange rate of 0.75)
USD
$1,200
$1,300
$1,400
$1,500
$1,600
$1,700
$1,800
$1,900
$2,000
$2,100
$2,200
b
l
/
D
U
A
d
n
a
b
l
/
D
S
U
e
c
i
r
p
r
e
p
p
o
C
AUD
$1,600
$1,733
$1,867
$2,000
$2,133
$2,267
$2,400
$2,533
$2,667
$2,800
$2,933
2.89
3.85
$564*
$633
$701
$770
$839
$907
$976
$1,044
$1,113
$1,182
$1,250
3.10
4.13
$698
$766
$835
$903
$972
$1,040
$1,109
$1,178
$1,246
$1,315
$1,383
3.50
4.67
$957
$1,026
$1,094
$1,163*
$1,232
$1,300
$1,369
$1,437
$1,506
$1,575
$1,643
3.90
5.20
$1,217
$1,286
$1,354
$1,423
$1,491
$1,560
$1,629
$1,697
$1,766
$1,834
$1,903
4.30
5.73
$1,476
$1,545
$1,614
$1,683
$1,751
$1,820
$1,888
$1,957
$2,026
$2,094
$2,163
4.70
6.27
$1,737
$1,805
$1,874
$1,943
$2,011
$2,080
$2,148
$2,217
$2,285
$2,354
$2,423
5.10
6.80
$1,996
$2,065
$2,134
$2,202
$2,271
$2,340
$2,408
$2,477
$2,545
$2,614
$2,682
5.50
7.33
$2,256
$2,325
$2,394
$2,462
$2,530
$2,599
$2,668
$2,737
$2,805
$2,874
$2,942
5.90
7.87
$2,516
$2,585
$2,654
$2,722
$2,790
$2,859
$2,928
$2,997
$3,065
$3,134
$3,202
* Pre-tax NPV7.5% from Kalkaroo project PFS (green) compared with that at long-term consensus US$ copper
and gold prices (orange), as calculated by the PFS financial model. NPV (Net Present Value) is a measure of
discounted cash flow valuation in this case using a discount rate of 7.5%. Note the value matrix uses an
AUD:USD exchange rate of 0.75.
It is noted the orange highlighted long-term consensus US$ copper and gold price pre-tax NPV7.5% of
$1.163 billion could still be considered conservative for the Kalkaroo project on several grounds:
1. No account has been taken of improved gold recoveries in the oxidised ore types, namely saprolite gold
and native copper from around 50% in the published PFS to >90% based on Havilah’s updated
metallurgical test work (refer to ASX announcement of 9 May 2019).
2. Open pit optimisations have not been re-run for higher long-term consensus US$ copper and gold prices.
On the basis that lower grades of ore can be profitably treated if metal prices are higher, it is reasonable to
assume (based on similar cost inputs) that re-optimisation would result in a larger open pit and hence
improved mining economics and a longer mine life. For the above table the published PFS open pit
optimisation and RPM Global Asia Limited PFS financial model have been used.
3. The potential revenue contribution from other by-product commodities such as cobalt, REE and
molybdenum has not been incorporated due to as yet uncertain recovery pathways.
The copper and gold combination in the Kalkaroo project is advantageous, as these metals are normally natural
hedges against each other – copper being driven to a large extent by stable industrial production and economic
development; and gold by uncertainty and instability.
Low sovereign risk, advanced, large-scale open pit copper-gold development opportunities in Australia like
Kalkaroo are rare, particularly at a time of escalating copper usage associated with the global movement
towards renewable energy. South Australia’s mining friendly government and enforcement of world’s best
practice ESG regulations means the Kalkaroo project ticks all boxes as a potential future ethical source of
copper (and potentially cobalt).
Page 11
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
DIRECTORS’ REPORT
Review of Operations (continued)
Mutooroo Copper-Cobalt-Gold Project (HAV 100% ownership)
Mutooroo is a lode-style sulphide copper and cobalt deposit, located approximately 60 km southwest of
Broken Hill, and 16 km south of the Transcontinental railway line and Barrier Highway. It contains
195,000 tonnes of copper, 20,200 tonnes of cobalt and 82,100 ounces of gold in Measured, Indicated and
Inferred JORC Mineral Resources.
At long-term consensus US$ copper and cobalt prices, the economics of Mutooroo as an open pit, and later as
an underground, mining operation are potentially attractive due to the comparatively high grades of copper
(1.53%) and cobalt (0.16%) in the sulphide ore. A PFS work program and budget, ,which includes a major
component of additional resource drilling and process plant and mining design work, is in the process of being
implemented.
Cobalt within the Mutooroo resource is contained within the iron sulphide minerals, pyrite and pyrrhotite.
These minerals can be separated and concentrated during the copper sulphide concentration process.
The cobalt-bearing iron sulphides are potentially an attractive grade cobalt feedstock for subsequent processing
to recover cobalt, and also if feasible, significant amounts of associated gold and sulphur. Havilah continues to
investigate the best options for recovery of cobalt contained in the iron sulphide concentrates, to capture
additional project revenue and so potentially improve returns from the Mutooroo project.
During the financial year a cultural heritage survey conducted by the Wilyakali Native Title claimants and their
appointed anthropologist cleared the strike extensions of the Mutooroo resource for drilling and two other
prospects. This survey had been delayed from 2020 due to COVID-19 related issues. Subsequently, Havilah’s
drilling crew moved from Kalkaroo to the Mutooroo Project Area south of the Barrier Highway. The primary
objective is drilling for additional shallow open pit resources initially along the northern strike extensions of the
current Mutooroo JORC Mineral Resource (Figure 2). The results of this drilling will form part of the PFS.
Havilah also plans to progress the mining lease proposal and PEPR document for the Mutooroo project in
parallel with the PFS work.
North
South
Figure 2 Long section through the Mutooroo deposit, showing the area proposed to be drilled for additional
shallow open pit resources (within dashed blue rectangle), lying immediately north of the conceptual open pit
(dark brown).
Page 12
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
DIRECTORS’ REPORT
Review of Operations (continued)
Grants Basin, Maldorky and Grants Iron Ore Projects (HAV 100% ownership)
The Maldorky project has a JORC Indicated Mineral Resource of 147 Mt of 30.1% iron at an 18% iron cut-off.
It is located approximately 90 km southwest of Broken Hill, and 26 km south of the Barrier Highway and
Transcontinental railway line. The iron ore resource is contained in a flat tabular deposit with thin overburden,
making it well suited to an open pit mining operation. Granting of the Mining Lease for Maldorky is dependent on
obtaining a signed Native Title Mining Agreement and successful land access negotiations.
The Grants iron ore deposit contains 304 Mt of 24% iron JORC Inferred Mineral Resource at an 18% iron cut-
off. The lack of overburden and geometry of the deposit is favourable for an open pit mining operation. It is
located approximately 80 km west-southwest of Broken Hill, and 8-10 km south of the Barrier Highway and
Transcontinental railway line. Only 1 km east is the potentially very large Grants Basin iron ore deposit
containing an Exploration Target* of 3.5-3.8 billion tonnes of 24-28% iron (refer to ASX announcement of 5 April
2019). The western end of this Exploration Target crops out as a solid body of iron ore at least 270 metres thick
from surface. It remains a high priority to carry out resource delineation drilling to convert a portion of the
western end Exploration Target to a maiden JORC Mineral Resource, initially targeting at least 0.5 billion tonnes
of iron ore.
Following a cultural heritage survey conducted by the Wilyakali Native Title claimants and their appointed
anthropologist and receipt of DEM drilling approvals, Havilah may proceed with a planned up to 64 hole reverse
circulation drilling program on specific resource targets during 2021 (identified on Figure 3).
* Note that the potential quantity and grade of the Exploration Target is conceptual in nature, there has been
insufficient exploration to estimate a Mineral Resource and it is uncertain if further exploration will result in the
estimation of a Mineral Resource.
Figure 3 A several thousand metre reverse circulation drilling program is planned at the western end of the
Grants Basin Exploration Target with the objective of defining a maiden JORC iron ore resource that can form
the basis for a mining scoping study. Additional reverse circulation drillholes are also proposed to improve
confidence in the existing Grants iron ore resource and elevate it to JORC Indicated classification (if feasible).
Port Augusta Operations
During early 2020 Havilah signed a Memorandum of Understanding with Port Augusta Operations Pty Ltd for
the future use of a planned large iron ore handling and transhipment facility near the city of Port Augusta (refer
to ASX announcement of 28 February 2020). During January 2021 the South Australian government approved
the development application for the former Port Augusta power station site to be transformed into a modern
port, to be called Port Playford, providing export shipping services to existing and future mining operations and
projects including the Curnamona and Braemar iron ore regions (see South Australia government Media
Release dated 19 January 2021).
Page 13
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
DIRECTORS’ REPORT
Review of Operations (continued)
Exploration Strategy
One of the Group’s major assets is its ~16,000 km2 under-explored tenement holding in the Curnamona Craton,
that is prospective for a variety of commodities including several strategic and critical minerals such as copper,
cobalt, REE, tin and tungsten. Exploration for new economic discoveries leveraging off the Group’s large
prospective tenement holding and utilising Havilah’s extensive knowledge base is a key objective.
Mutooroo Project Area (HAV 100% ownership)
The area surrounding the Mutooroo deposit (termed the ‘Mutooroo Project Area’) is highly prospective for the
discovery of lode-style copper-cobalt-gold resources which can potentially provide supplementary feed to a
central sulphide ore processing hub at Mutooroo and hence boost that project’s economics. Many earlier
economic grade copper and/or gold drilling intersections in the area (Figure 4) have never been followed up, in
some cases for over 50 years. In addition, numerous copper, cobalt and gold surface geochemical anomalies
identified by Havilah and earlier explorers present completely new targets to test (eg. Cockburn prospect).
Over the next 2 years the Group intends to systematically map, sample and drill known prospects and an
experienced exploration geologist has been dedicated to this task. This work has commenced with drilling of the
Cockburn and Mutooroo West prospects as described in more detail below. The area has the major logistical
advantage of being close to Broken Hill, the Barrier Highway and Transcontinental railway line.
Figure 4 Mutooroo Project Area showing promising regional prospects in proximity to the Mutooroo resource.
Page 14
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
DIRECTORS’ REPORT
Review of Operations (continued)
Cockburn Copper-Cobalt-Gold Prospect (HAV 100% ownership) (formerly Viper prospect)
The Cockburn prospect (Figure 4) lies 45 km southwest of Broken Hill within sight of the highway border town of
Cockburn, and 15 km north of Mutooroo. Highly anomalous surface geochemical samples containing up to
0.26% copper, 0.16% cobalt and 1.03 g/t gold were collected by earlier exploration groups and confirmed by
Havilah’s 2018 systematic surface lag sampling and rock chip sampling program (refer to ASX announcement of
28 August 2018 and ASX announcement of 7 December 2018, page 17). Follow up field checking by Havilah
geologists identified the likely source of the geochemical anomaly as a sulphide gossan that returned up to
0.4% copper and 0.15% cobalt in Niton XRF readings. The main gossan outcrop is restricted to an area of a few
tens of square metres.
Four reverse circulation drillholes completed during the financial year intersected a 10-20 metre wide zone of
fresh and oxidised sulphides with associated vein quartz beneath the gossan (refer to ASX announcement of 17
August 2021). The fresh sulphides are comprised predominantly of pyrite (iron sulphide) and some chalcopyrite
(copper sulphide). It is interpreted that the steeply east-dipping mineralisation occurs at the sheared contact of
mica schist and gneissic rocks. Therefore, as interpreted by Havilah geologists, the subtle gossan outcrop at the
Cockburn prospect is the surface expression of a quartz-sulphide lode at depth, with general similarities to the
Mutooroo sulphide lode system.
New assay results at the Cockburn prospect indicate significant gold, cobalt and copper associated with the
quartz sulphide lode including 27 metres of 0.4 g/t gold, 0.11% cobalt and 0.12% copper from 69 metres in
drillhole CKRC003 (refer to ASX announcement of 26 August 2021, page 7). The combined metal values and
high sulphur value of the pyrite points to a promising new mineral discovery, that could potentially provide
additional feed to a sulphide ore processing hub at Mutooroo.
The current drillholes have tested only a short section of the likely >1.5 km lode structure at shallow depths.
The width and mineralisation style of the lode are geologically favourable and warrant further follow up drilling to
determine the economics of the Cockburn prospect discovery.
Mutooroo West Copper-Cobalt-Gold Prospect (HAV 100% ownership) (formerly Scorpion prospect)
The Mutooroo West prospect (Figure 4) lies 4 km northwest of Mutooroo and like Mutooroo was mined for
copper in the early 1900’s after discovery of an outcropping copper stained gossan by early prospectors. The
Record of the Mines of South Australia (Fourth Edition, 1908, page 98) in describing the early 1900’s mining
activity here notes a “large body of sulphide ore” with the lode approximately 6-7 metres wide at 30 metres
depth and returning 3-4% (hand-picked) copper grades and 20-30% sulphur. The best result from 5 diamond
drillholes completed by MEPL (Mines Exploration Pty Ltd) during 1965 was 7.17 metres of 0.32% copper from
115.8 metres. These drillholes were not assayed for cobalt or gold, but rock chip samples of gossan and pyritic
dump material assayed up to 0.16% cobalt and 2.22 g/t gold (refer to ASX announcement of 26 April 2018).
In the first drilling for over 50 years, the Group has recently completed 6 reverse circulation drillholes to test for
shallow copper-cobalt mineralisation near the base of oxidation, up-dip and along strike from the MEPL
diamond drillholes and specifically testing a priority one AEM (airborne electromagnetic) bedrock conductor
(refer to ASX announcement of 12 August 2019).
Jupiter MT Target (HAV 100% ownership)
Jupiter is a major unexplained MT conductive zone located in the north of the Group’s tenement holding that is
analogous to that seen extending to depth below Olympic Dam (refer Jupiter MT anomaly target). The basic
premise is that the geological setting of the poorly explored northern Curnamona Craton is highly conducive to
the formation of major copper deposits. The ultimate objective of this work is to determine whether Jupiter is
indicative of a mineralisation feeder to a copper-gold deposit as on the Gawler Craton. An ADI (Accelerated
Development Initiative) grant provides matching funding of $125,000 primarily to collect more detailed MT data
over the Jupiter conductive zone that will assist in drill-targeting, plus orientation MT data over the Kalkaroo fault
zone (refer to ASX announcement of 26 June 2020). The field survey work has been completed and processing
of the data and interpretation is in progress.
Page 15
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
DIRECTORS’ REPORT
Review of Operations (continued)
Rare Earth Potential at Kalkaroo Project and Other Prospects (HAV 100% ownership)
In collaboration with the University of South Australia’s Future Industries Institute, the Group has been
conducting research studies into the nature of REE mineralisation associated with the saprolite gold ore at
West Kalkaroo. Bastnasite, a REE carbonate-fluoride mineral, has been identified as the primary REE host in
West Kalkaroo oxidised copper-gold ore samples. Results from electron microprobe spot analyses for several
bastnasite mineral grains showed that it contains up to 26% of the valuable REE, neodymium. Importantly, the
sample contained no measurable radioactive thorium or uranium (refer to ASX announcement of 3 November
2020).
Laboratory studies have shown that the bastnasite can be significantly concentrated due to the fact that most of
it is at an optimum 10-50 micron size range that is well suited to concentration by flotation and other methods
specific to REE. The chief task has been determining how best to integrate bastnasite recovery into the oxidised
ore processing flow sheet. Some new pilot scale separation equipment has been purchased by the Group,
which will be trialled in the short-term.
The value upside for the Group is that if REE can be economically recovered in a bastnasite concentrate, as a
by-product of the standard copper and gold recovery processes, it potentially provides a further revenue stream
for the Kalkaroo project which in turn enhances its development potential.
Croziers Copper-Tungsten-REE Prospect (HAV 100% ownership)
A short exploration drilling campaign was undertaken at the Croziers prospect during the financial year to test
the theory that the magnetite skarn has replaced a hangingwall carbonate unit and that from previous
experience the potentially mineralised regional Prospective Sequence, that hosts the Kalkaroo and North Portia
deposits, should occur stratigraphically ~150 to 200 metres below.
Two reverse circulation holes drilled an interpreted up-dip, near surface projection of the regional stratabound
Prospective Sequence at Croziers that is the main host to copper-gold mineralisation throughout the
Curnamona Craton, including the Kalkaroo deposit. Unfortunately, the Prospective Sequence at this location is
either poorly developed and thinner than usual or may have been largely or completely sheared out (refer to
ASX announcement of 26 February 2021, page 7).
The region still has high prospectivity for copper, gold, REE and tungsten mineralisation based on earlier
Pasminco-Werrie Gold joint venture drilling to the north, and other targets will be drilled in the area once cleared
by native title heritage surveys, subject to Havilah’s other work priorities.
This drilling was supported by an ADI (Accelerated Discovery Initiative) grant providing matching funding of
$150,000, a major objective of which was to obtain bulk drill samples to allow study of the mineralogical and
metallurgical recovery parameters for REE in a research collaboration with the University of South Australia’s
Future Industries Institute (refer to ASX announcement of 1 June 2020). Anomalously high levels of REE were
previously noted in assays from Croziers (refer to ASX announcement of 7 January 2020).
Exploration and Development of Uranium Interests (HAV 100% ownership)
Uranium sentiment remains positive in the light of demand for non-carbon dioxide emitting sources of base-load
electricity. The Group holds significant uranium assets, as documented on the Company’s website, that are
strategically located between the Beverley uranium mine and the Honeymoon restart uranium operation (owned
by Boss Energy Ltd). A valuable legacy of exploration data identifies numerous promising sand-hosted uranium
prospects in the vicinity of the Benagerie Ridge, the Yarramba palaeovalley downstream from the Honeymoon
uranium deposit and in the similarly lightly explored Lake Namba palaeovalley. The Board remains committed to
progressing its non-core uranium prospects and projects in a prudent manner with external funding, while
leaving Havilah shareholders with a fair residual benefit in the event of success.
Page 16
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
DIRECTORS’ REPORT
JORC Ore Reserves as at 31 July 2021
Project
Classification
Tonnes
(Mt)
Copper
%
Gold
g/t
Copper tonnes
(kt)
Gold ounces
(koz)
Kalkaroo
1
Proved
Probable
Total
90.2
9.9
100.1
0.48
0.45
0.47
0.44
0.39
0.44
430
44
474
1,282
125
1,407
JORC Mineral Resources as at 31 July 2021
Project
Classification
Resource
Category
Tonnes
Copper
%
Cobalt
%
Gold
g/t
Copper
tonnes
Cobalt
tonnes
Gold
ounces
Measured
Oxide
Oxide
Sulphide
Copper-
Cobalt-Gold
Sulphide
Copper-
Cobalt-Gold
Sulphide
Copper-
Cobalt-Gold
Sulphide
Copper-
Cobalt-Gold
Total
Mutooroo
Oxide Gold
Cap
Oxide Gold
Cap
Oxide Gold
Cap
Oxide Gold
Cap
Sulphide
Copper-Gold
Sulphide
Copper-Gold
Sulphide
Copper-Gold
Sulphide
Copper-Gold
Total
Kalkaroo
Cobalt
Sulphide4
All
Categories
(rounded)
Mutooroo
2
Kalkaroo
3
Total
Measured
Indicated
Inferred
Total
Measured
Indicated
Inferred
Total
Measured
Indicated
Inferred
Total
Inferred
Total All Projects
Project
Classification
Maldorky 5
Grants 6
Total All
Projects
Indicated
Inferred
All categories
Project
Classification
Oban 7
Inferred
598,000
598,000
0.56
0.56
0.04
0.08
0.04
0.08
3,300
3,300
200
200
1,500
1,500
4,149,000
1.23
0.14
0.18
51,000
5,800
24,000
1,697,000
1.52
0.14
0.35
25,800
2,400
19,100
6,683,000
1.71
0.17
0.17
114,300
ISD
ISD
12,529,000
1.53
0.16
0.20
191,700
20,000
80,600
13,127,000
12,000,000
6,970,000
2,710,000
21,680,000
195,000
20,200
82,100
316,400
138,900
59,200
514,500
0.82
0.62
0.68
0.74
85,600,000
0.57
0.42
487,900
1,155,900
27,900,000
0.49
0.36
136,700
322,900
110,300,000
0.43
0.32
474,300
1,134,800
223,800,000
0.49
0.36
1,096,600
245,480,000
1,096,600
2,590,300
3,104,800
193,000,000
0.012
23,200
258,607,000
1,291,600
43,400
3,186,900
Tonnes
(Mt)
147
304
451
Tonnes
(Mt)
8
Iron
(%)
30.1
24
Fe concentrate
(Mt)
59
100
159
Estimated
yield
40%
33%
eU3O8 (ppm)
Contained eU3O8 (Tonnes)
260
2,100
There were no changes in the JORC Ore Reserves and Mineral Resources as at 31 July 2021 compared with 31 July 2020.
Numbers in above tables are rounded.
Footnotes to 2021 JORC Ore Reserve and Mineral Resource Tables
¹ Details released to the ASX: 18 June 2018 (Kalkaroo)
² Details released to the ASX: 18 October 2010 and 5 June 2020 (Mutooroo)
³ Details released to the ASX: 30 January 2018 and 7 March 2018 (Kalkaroo)
4 Note that the Kalkaroo cobalt Inferred Resource is not added to the total tonnage
5 Details released to the ASX: 10 June 2011 applying an 18% Fe cut-off (Maldorky)
6 Details released to the ASX: 5 December 2012 applying an 18% Fe cut-off (Grants)
7 Details released to the ASX: 4 June 2009 applying a grade-thickness cut-off of 0.015 metre % eU3O8 (Oban)
Page 17
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
DIRECTORS’ REPORT
Summary of Governance Arrangements and Internal Controls in Place for the Reporting of Ore Reserves
and Mineral Resources
Ore Reserves and Mineral Resources are estimated by suitably qualified employees and consultants in
accordance with the JORC Code, using industry standard techniques and internal guidelines for the estimation
and reporting of Ore Reserves and Mineral Resources. These estimates and the supporting documentation
were reviewed by a suitably qualified Competent Person prior to inclusion in this Annual Report.
Competent Person’s Statements
The information in this Annual Report that relates to Exploration Targets, Exploration Results, Mineral
Resources and Ore Reserves is based on data compiled by geologist Dr Christopher Giles, a Competent
Person who is a member of The Australian Institute of Geoscientists. Dr Giles is a Director of the Company, a
full-time employee and is a substantial shareholder. Dr Giles has sufficient experience, which is relevant to the
style of mineralisation and type of deposit and activities described herein, to qualify as a Competent Person as
defined in the 2012 Edition of ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and
Ore Reserves’. Dr Giles consents to the inclusion in this Annual Report of the matters based on his information
in the form and context in which it appears. Information for the Kalkaroo Ore Reserve & Mineral Resource and
the Mutooroo Inferred cobalt & gold Mineral Resources complies with the JORC Code 2012. All other
information was prepared and first disclosed under the JORC Code 2004 and is presented on the basis that the
information has not materially changed since it was last reported. Havilah confirms that all material assumptions
and technical parameters underpinning the reserves and resources continue to apply and have not materially
changed.
Except where explicitly stated, this Annual Report contains references to prior Exploration Targets and
Exploration Results, all of which have been cross-referenced to previous ASX announcements made by Havilah.
The Company confirms that it is not aware of any new information or data that materially affects the information
included in the relevant ASX announcements.
Financial Position
At the end of the financial year the Group had a cash and cash equivalents balance of $4,007,410
(31 July 2020: $1,483,724).
The Group’s working capital, being current assets less current liabilities, increased from a net current asset
surplus of $68,013 as at 31 July 2020 to $2,737,221 as at 31 July 2021 predominantly as a result of capital
raisings.
The Group’s equity investment in ASX listed Auteco Minerals Ltd as at 31 July 2021 was valued at $540,834
(31 July 2020: $860,417).
Exploration and evaluation expenditure carried forward increased during the financial year to $37,346,924
primarily due to $1,777,334 incurred on Kalkaroo mining leases and other mineral exploration tenements in
South Australia.
The Kalkaroo Station pastoral lease, on which the Kalkaroo deposit is situated, continues to be carried at cost
($2,241,043) in property, plant and equipment.
The Group’s total liabilities decreased predominantly due to a partial settlement with the ATO on a prior financial
period Research & Development amendment; partially offset by an increase in trade and other payables and
deferred grants.
The Group was awarded two ADI (Accelerated Discovery Initiative) grants amounting to a total of $275,000
during the financial year, provided on a matching dollar-for-dollar expenditure basis, from the South Australian
government. Of this amount $111,500 was received during the financial year under the ADI advanced payment
arrangement (recognised as deferred grants).
The Company issued 35,331,548 new ordinary shares during the financial year, with contributed equity
increasing by $5,923,280 as at 31 July 2021. Funds raised will be applied to advance Havilah’s key projects, to
carry out exploration and in meeting tenement and other administrative costs through to the end of 2021.
Page 18
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
DIRECTORS’ REPORT
Cash Flows
Operating activities resulted in net cash outflows of $1,530,776 for the financial year (2020: $3,693,060),
predominantly for payments to suppliers and employees $1,696,367 (2020: $3,041,180), payments for
exploration and evaluation expenditure expensed $398,878 (2020: $374,322), repayment of research &
development $Nil (2020: $342,742), and interest and other costs of finance paid $9,860 (2020: $177,724);
partially offset by receipts from customers $254,665 (2020: $85,758), COVID-19 grants received $207,800
(2020: $147,852), and government grants received for exploration activities $111,500 (2020: $Nil).
Net cash outflows from investing activities of $1,793,421 (2020: $1,086,493) for the financial year were primarily
associated with payments for exploration and evaluation expenditure of $1,777,334 (2020: $966,946) on the
Group’s exploration projects.
Financing activities resulted in net cash inflows of $5,847,883 (2020: $2,443,631) for the financial year,
predominantly associated with proceeds from issue of new ordinary shares $6,006,400 (2020: $5,273,978) and
proceeds from borrowing $Nil (2020: $79,291); partially offset by payment of ordinary share issue costs $83,120
(2020: $42,209), repayments of borrowings of $75,397 (2020: $2,661,695), and principal element of lease
payments $Nil (2020: $205,734).
The financial year ended with a net increase in cash and cash equivalents of $2,523,686 (2020: net decrease
$2,335,922).
Financial Results
The consolidated result of
(2020: $4,726,429).
the Group
for
the
financial year was a
loss after
tax of $2,361,870
Fair value loss of $319,583 (2020: $825,996 gain) was from the Group’s equity investment in Auteco Minerals
Ltd, designated as fair value through profit or loss (‘FVTPL’).
Expenses for the financial year includes net employee benefits expense of $1,450,748 (2020: $2,069,925),
which includes share-based payments expense of $381,135 (2020: $321,801) associated with unlisted share
options.
The loss for the financial year also includes exploration and evaluation expenditure expensed of $398,878
(2020: $374,322) and
impairment of capitalised exploration and evaluation expenditure of $Nil
(2020: $106,687). Partially offsetting the loss for the financial year was revenue associated with Portia Gold
Mine royalty revenue of $149,480 (2020: $120,993) and sales revenue associated with gold inventory $Nil
(2020: $2,220); and other income associated with interest income of $364 (2020: $9,298), COVID-19 grants
received $207,800 (2020: $147,852), diesel fuel rebates received $25,836 (2020: $8,933), SIMEC Mining
exclusivity payment $Nil (2020: $1,000,000), net settlement with the Australian Taxation Office (‘ATO’) $267,062
(2020: $Nil) which includes consulting costs in negotiating the outcome, other sundry income $20,260
(2020: $Nil), and gain on disposal of plant and equipment $Nil (2020: $4,000).
During the financial year the Board has focused expenditure on the near-term strategy to prepare the West
Kalkaroo project for development. This has included an infill drilling program to support a potential mining
program and the preparation and lodgement of the PEPR with the DEM.
Corporate Governance
The Group has adopted fit for purpose systems of control and accountability as the basis for the administration
and compliance of effective and practical corporate governance. These systems are reviewed periodically and
revised if appropriate. The Board of Directors is committed to administering the Group’s policies and procedures
with transparency and integrity, pursuing the genuine spirit of good corporate governance practice. To the
extent they are applicable, the Group has adopted the ASX Corporate Governance Council’s Corporate
Governance Principles and Recommendations (4th Edition). As the Group’s activities transform in size, nature
and scope, additional corporate governance structures will be considered by the Board of Directors and
assessed as to their relevance.
In accordance with the ASX Listing Rules, the Corporate Governance Statement and Appendix 4G checklist as
approved by the Board of Directors are released to the ASX on the same day the Annual Report is released.
The Corporate Governance policies and charters are available under the Corporate Governance tab on the
Company's website.
Page 19
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
DIRECTORS’ REPORT
Remuneration Report (Audited)
This Remuneration Report, which forms part of this Directors’ Report, sets out information about the
remuneration of the Group’s key management personnel for the financial year. The term ‘key management
personnel’ refers to those persons having authority and responsibility for planning, directing and controlling,
directly or indirectly, the activities of the consolidated entity.
The information provided in this Remuneration Report has been audited by the Company’s external auditor, as
required by Section 308(3C) of the Corporations Act 2001.
The prescribed details for each person covered by this Remuneration Report are detailed below under the
following sections:
Section 1. Key Management Personnel Details
Section 2. Remuneration Policy
Section 3. Relationship between the Remuneration Policy and Group Performance
Section 4. Remuneration of Key Management Personnel
Section 5. Key Terms of Employment Contracts
Section 6. Statutory Reporting
Section 1. Key Management Personnel Details
The following persons acted as Directors or other key management personnel of the Group during the financial
year:
Position
Term
Directors
Mr Simon Gray
Executive Director – Chairman, Company Secretary,
Chief Financial Officer
Full financial year
Mr Victor Previn
Independent Non-Executive Director
Full financial year
Dr Christopher Giles
Executive Director – Technical Director
Full financial year
Other Key Management Personnel
Mr Richard Buckley
Senior Mine Planning Engineer
Full financial year
The named persons held their current position for the whole of the financial year and since the end of the
financial year.
Section 2. Remuneration Policy
The Group embodies the following criteria in its remuneration framework:
(i) performance-based and aligned with the Group’s vision, values and overall business objectives;
(ii) designed to motivate Directors and executives to pursue the Group’s long-term growth and success; and
(iii) demonstrate a clear relationship between the Group’s overall performance and the performance of
executives and employees.
The objectives of the Remuneration Committee are to support and advise the Board of Directors on
remuneration matters and oversee the setting of remuneration policy, fees and remuneration packages for
Directors and senior executives. Where possible, the Remuneration Committee should comprise at least
3 members, the majority being Independent Non-Executive Directors.
In response to circumstances presented to it during the prior financial year, Havilah significantly reduced its
operating costs. This resulted in consolidation of the roles of management, with a Board which is more involved
in the operations. As a result, it has been unable to meet the criteria for having a majority of Remuneration
Committee members being independent.
Page 20
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
DIRECTORS’ REPORT
Remuneration Report (Audited) (continued)
Section 2. Remuneration Policy (continued)
It is the responsibility of the Remuneration Committee to review and make recommendations to the Board on:
(a) the remuneration packages of all Directors and senior executives, including terms and conditions offered to
all new appointees to these roles;
(b) the adoption of appropriate long-term and short-term incentive and bonus plans, including regular review of
the plans and the eligible participants; and
(c) staff remuneration and incentive policies and practices.
The full objectives and responsibilities of the Remuneration Committee are documented in the charter approved
by the Board of Directors and is available under the Corporate Governance tab on the Company’s website.
Non-Executive Directors’ fees are determined within an aggregate Directors’ fee pool limit, which is periodically
approved by shareholders. Total remuneration for all Non-Executive Directors, last voted upon by shareholders
at the 2016 Annual General Meeting, is not to exceed $300,000 per annum.
At the 2020 Annual General Meeting a resolution that the Remuneration Report for the financial year ended
31 July 2020 be adopted was put to the vote, and received a 95.12% vote (cast on a poll) in favour.
Section 3. Relationship between the Remuneration Policy and Group Performance
Due to the current size and nature of the Company, the Board of Directors does not consider a link between
remuneration and Group financial performance is appropriate.
The tables below set out summary information about the Group’s earnings and movements in shareholder
wealth to 31 July 2021:
Financial Year Ended 31 July:
2021
$
2020
$
2019
$
Revenue
149,480
123,213
843,178
Loss for financial year
(2,361,870)
(4,726,429)
(7,337,693)
Financial Year Ended 31 July:
Share price at beginning of financial year
Share price at end of financial year
Basic and diluted loss per ordinary share
2021
Cents
19
20.5
(0.80)
2020
Cents
15
19
(1.90)
2019
Cents
22
15
(3.36)
Page 21
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
DIRECTORS’ REPORT
Remuneration Report (Audited) (continued)
Section 4. Remuneration of Key Management Personnel
Financial Year
Ended
31 July 2021
Short-term employee benefits
Post-
employment
benefits
Long-term
employee
benefits
Share-based
payments
expense
Salary &
fees
Annual
leave
Non-
monetary
Superannua-
tion
Long
service
leave
Share
options 1
Directors
Mr Simon Gray
Mr Victor Previn
$
$
80,000
30,000
6,069
-
$
-
-
Dr Christopher Giles
175,000
13,277
6,2162
Other Key Management Personnel
Mr Richard Buckley
250,005
Total
535,005
11,255
30,601
-
6,216
$
7,646
2,867
16,726
22,751
49,990
Financial Year
Ended
31 July 2020
Short-term employee benefits
Post-
employment
benefits
Long-term
employee
benefits
Share-based
payments
expense
Salary &
fees
Terminat-
ion pay
Non-
monetary
Superannua-
tion
Long
service
leave
Share
options 1
Directors
Mr Victor Previn *
Mr Simon Gray *
$
13,846
58,651
Dr Christopher Giles
174,326
Mr Mark Stewart **
Mr Martin Janes **
34,919
16,771
Other Key Management Personnel
Mr Richard Buckley
250,004
$
-
-
-
-
-
-
Mr Walter Richards #
72,347
228,466
$
-
-
6,2162
-
-
-
-
Total
620,864
228,466
6,216
$
1,664
4,384
16,560
3,317
1,205
23,780
22,548
73,458
* Messrs Previn and Gray were appointed Directors on 9 October 2019.
** Messrs Stewart and Janes resigned as Directors on 9 October 2019.
# Mr Walter Richards was made redundant 2 October 2019.
$
-
-
-
$
-
-
-
Total
$
93,715
32,867
211,219
6,182
6,182
87,991
378,184
87,991
715,985
Total
$
15,510
63,035
$
-
-
36,804
233,906
-
-
38,236
17,976
$
-
-
-
-
-
6,500
-
16,026
296,310
53,564
376,925
6,500
106,394
1,041,898
1 The value of share options granted to key management personnel as part of their remuneration is calculated as at the
grant date using a binomial option pricing model. The amounts disclosed as part of remuneration for the financial year
have been determined by allocating the grant date value on a straight-line basis over the period from grant date to
vesting date. For share options that vest immediately, the value is disclosed as an expense immediately. Share options
do not represent cash payments to Directors and other key management personnel. Share options granted may or may
not be exercised by Directors and other key management personnel.
2 Provision of Company funded vehicle.
Page 22
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
DIRECTORS’ REPORT
Remuneration Report (Audited) (continued)
Section 4. Remuneration of Key Management Personnel (continued)
The relative proportions of those elements of remuneration of key management personnel that are fixed and
those consisting of share options are as follows:
Fixed remuneration
Remuneration as share options 1
2021
2020
2021
Directors
Mr Simon Gray *
Mr Victor Previn *
Dr Christopher Giles
Mr Mark Stewart **
Mr Martin Janes **
Other Key Management Personnel
Mr Richard Buckley
Mr Walter Richards #
100%
100%
100%
-
-
76.7%
-
100%
100%
84.3%
100%
100%
94.6%
85.8%
* Messrs Gray and Previn were appointed Directors on 9 October 2019.
** Messrs Stewart and Janes resigned as Directors on 9 October 2019.
# Mr Walter Richards was made redundant 2 October 2019.
0%
0%
0%
-
-
23.3%
-
2020
0%
0%
15.7%
0%
0%
5.4%
14.2%
1 The percentage of total remuneration consisting of share options, based on the value of share options and expensed
in the consolidated statement of profit or loss and other comprehensive income during the financial year and prior
financial year.
Performance Rights and Share Option Plan
The Board of Directors approved the Performance Rights and Share Option Plan (‘Plan’) during March 2019.
The Plan’s purposes are to:
(a) provide incentive to eligible executives and employees by enabling them to participate in the profits and
financial performance of the Company;
(b) attract, motivate and retain eligible executives and employees; and
(c) align the interests of eligible executives and employees more closely with shareholders in the Company and
provide greater incentive for the eligible executives and employees to focus on longer-term goals of the
Company.
The Plan is open to all employees but excludes Directors of the Company.
The number of share options granted to employees is set by the Board of Directors at its discretion but
consideration is given to employment contract terms. Employees are the key to Havilah’s success. Exploration
activity is managed by professionally skilled and technically competent personnel and is supported by a team
with decades of proven experience in their fields. Exploration success remains the basic long-term driver for the
Group’s organic growth. During the financial year 4,400,000 share options were granted to employees under the
Plan.
Each employee share option converts into one ordinary share of Havilah Resources Limited on exercise.
No amounts are paid or payable by the recipient on receipt of the share option. The share options carry neither
dividend nor voting rights. Share options may be exercised at any time from the date of vesting to the date of
their expiry.
The share options granted expire within the option period set by the Board of Directors at its discretion.
Share options expire 1 month after the resignation of the Director or employee but this condition can be waived
at the discretion of the Board of Directors. The Board at the time the Company made significant redundancies
during the prior financial year exercised its discretion not to require the relevant share options to lapse but allow
them to continue for their full term.
The Company’s short-term incentive plan annual award is subject to the absolute discretion of the Board of
Directors. Payment of any short-term incentive plan bonus can be satisfied in cash or share options, subject to
the discretion of the Board of Directors.
Page 23
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
DIRECTORS’ REPORT
Remuneration Report (Audited) (continued)
Section 4. Remuneration of Key Management Personnel (continued)
Any performance bonus awarded is calculated based on the Group’s performance objectives and individual
performance objectives related to the annual business plan as approved by the Board of Directors. The formula
rewards management and salaried employees against the extent of the Group’s and individual’s achievement
against both qualitative and quantitative criteria. The Group’s performance objective measurements are: safety;
environmental stakeholder engagement; team performance; reporting, planning and management; investors/
shareholders engagement; risk/opportunity management; and funding success. No performance bonuses were
rewarded during the financial year.
Terms and conditions of share-based payment arrangements affecting remuneration of key management
personnel during the financial year or future financial years:
Grant date
Grant date
fair value
Exercise price
per share option
Expiry date
Vesting date
Other Key Management Personnel
Mr Richard Buckley
26 June 2019
$0.05
$0.22
11 July 2023
75% vested;
25% 11 July 2022
Mr Richard Buckley
26 June 2019
Mr Richard Buckley
3 May 2021
$0.05
$0.11
$0.28
11 July 2023
$0.25
30 April 2024
100% vested
100% vested
The total value of share options included in remuneration for the financial year is calculated in accordance with
AASB 2 ‘Share-based Payment’. Share options granted during the current or prior financial years are
recognised in share-based payments expense in profit or loss over their vesting period. For share options that
vest immediately, the value is disclosed as an expense immediately.
There has been no alteration of the terms and conditions of the above share-based payment arrangements
since the grant date.
During the financial year no key management personnel exercised share options that were granted to them as
part of their remuneration.
Value of share options – basis of calculation:
•
the fair value of share options granted is calculated as at the grant date using a binomial option pricing
model. This grant date value is allocated to remuneration of key management personnel on a straight-line
basis over the period from grant date to vesting date; and
value of share options lapsed at the lapse date is calculated by multiplying the grant date value of the
share options by the number of share options lapsed during the financial year.
•
For each grant of share options in the current or prior financial years which resulted in share-based payments
expense to a Director or other key management personnel, the percentage of the grant that vested and the
number vested is set out below:
Name
Number granted Number vested % of grant vested
Maximum total value
of grant yet to vest
Other Key Management Personnel
Mr Richard Buckley
150,000
Mr Richard Buckley
Mr Richard Buckley
791,389
800,000
112,500
791,389
800,000
75%
100%
100%
$1,381
$-
$-
The maximum value of share options and performance rights yet to vest was determined as the amount of the
grant date fair value of the share options that is yet to be expensed in profit or loss.
No share options will vest if the service conditions are not met, therefore the minimum value of the share option
yet to vest is $Nil.
Page 24
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
DIRECTORS’ REPORT
Remuneration Report (Audited) (continued)
Section 4. Remuneration of Key Management Personnel (continued)
Mr Mark Stewart’s 600,000 Director share options exercisable at $0.40 each on or before 12 December 2020
lapsed in accordance with the December 2017 terms under which they were issued. The value of the Director
share options lapsed was $36,000. There were no other share options that lapsed or that were forfeited during
the financial year in relation to share options granted to key management personnel as part of their
remuneration.
All share options issued to a Director are made pursuant to approval by shareholders at relevant annual general
meetings.
Share Trading Policy
Under Havilah’s Share Trading Policy, an individual may not limit their exposure to risk in relation to securities
(including unlisted share options). Directors and executives are prohibited from entering into any hedging
arrangements over unvested share options. Havilah’s Share Trading Policy is available under the Corporate
Governance tab on the Company’s website.
Section 5. Key Terms of Employment Contracts
During the financial year there has been no increase to the base remuneration of any of the key management
personnel.
All termination payments are subject to the limits prescribed under Section 200B of the Corporations Act 2001.
Directors
Contract:
Title:
Mr Victor Previn
Non-Executive Director
Non-Executive Director
Dr Christopher Giles
Executive agreement
Executive Director –
Technical Director
Duration:
Period of notice:
Termination
payments:
Change of control
clause:
Remuneration
(exclusive of
superannuation):
Vehicle provided for
Company use:
Remuneration –
Short-term incentive:
Plan eligible:
No expiration
None
None
No fixed term
6 months, in writing
Payment in lieu of notice
No
No
No
$30,000 per annum
$174,984 per annum
$80,000 per annum
No
No
No
Yes
No
At the discretion of the
Board
No
At the discretion of the
Board
No
Other Key Management Personnel
Contract:
Title:
Duration:
Period of notice:
Termination payments:
Change of control clause:
Remuneration – Base Salary
(exclusive of superannuation):
Vehicle provided for Company
use:
Remuneration – Short-term
incentive:
Remuneration – Long-term
incentive:
Mr Richard Buckley
Employment agreement
Senior Mine Planning Engineer
No fixed term
5 weeks, in writing
Payment in lieu of notice
No
$250,000 per annum
No
Up to 30% of the Base Salary, payable at the discretion of the Board
Eligible to participate in any Company long-term incentive plan
Page 25
Mr Simon Gray
Executive agreement
Executive Director –
Chairman, Company
Secretary, Chief Financial
Officer
No fixed term
1 month, in writing
Payment in lieu of notice
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
DIRECTORS’ REPORT
Remuneration Report (Audited) (continued)
Section 6. Statutory Reporting
Loans to Key Management Personnel
During the financial year there have been no loans made to any of the key management personnel.
Key Management Personnel Ordinary Share Holdings
The number of Havilah Resources Limited ordinary shares held by Directors and other key management
personnel, including their personally related parties, as at 31 July 2021 was as follows:
Balance at
31 July
2020
Granted as
remuneration
Ordinary
shares
purchased 1
Ordinary
shares
sold
Balance at 31
July 2021
Balance
held
nominally 2
Directors
Mr Simon Gray
100,000
Mr Victor Previn
2,275,153
Dr Christopher Giles
41,945,674
Other Key Management Personnel
Mr Richard Buckley
557,500
-
-
-
-
58,823
176,469
88,235
117,647
-
-
-
-
158,823
2,451,622
42,033,909
675,147
-
-
-
-
1 Represents ordinary shares purchased via the share purchase plan.
2
‘Held nominally’ refers to the situation where the ordinary shares are in the name of the Director or
other key management personnel, but they are not the beneficial owner.
Key Management Personnel Share Option Holdings
The number of share options (unlisted) held by Directors and other key management personnel, including their
personally related parties, as at 31 July 2021 was as follows:
Balance
at 31 July
2020
40,000
-
Directors
Mr Simon Gray *
Mr Victor Previn
Dr Christopher Giles
2,400,000
Other Key Management Personnel
Granted as
remuneration
Balance at
31 July 2021
Total vested
&
exercisable
at 31 July
2021
Total
unvested at
31 July 2021
Options
vested
during
financial
year
-
-
-
40,000
30,000
10,000
10,000
-
-
2,400,000
2,400,000
-
-
-
-
Mr Richard Buckley
941,389
800,000
1,741,389
1,703,889
37,500
1,035,347
* Mr Simon Gray became a Director on 9 October 2019. Prior to that date, he was the Company Secretary and had
been granted 40,000 share options during a prior financial period. Therefore, these share options do not form part of
his Director remuneration.
No share options were exercised by Directors or other key management personnel during the financial year.
Page 26
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
DIRECTORS’ REPORT
Remuneration Report (Audited) (continued)
Section 6. Statutory Reporting (continued)
Other Transactions with Key Management Personnel of the Group
Transactions between related parties are on normal commercial terms and conditions, no more favourable than
those available to other parties, unless otherwise stated.
During the financial year the Group incurred the following other amounts as a result of transactions with
Directors and other key management personnel, including their personally related parties (excluding amounts
paid as remuneration to Directors and other key management personnel which are addressed elsewhere in this
Remuneration Report):
•
•
•
$23,732 (2020: $37,600) for marketing and public relations services to a social media company (Filtrd) in
which a related party (William Giles) of Dr Christopher Giles has an interest. The balance outstanding
included in trade and other payables is $2,000 (2020: $11,000);
$Nil (2020: $2,565) for legal services provided by a company (Arion Legal) that is a related party of
Mr Mark Stewart (who ceased to be a Havilah Director on 9 October 2019). The balance outstanding
included in trade and other payables is $Nil (2020: $Nil); and
$Nil (2020: $2,400) for marketing and public relations support to a related party (William Giles) of
Dr Christopher Giles. The balance outstanding included in trade and other payables is $Nil (2020: $Nil).
END OF REMUNERATION REPORT (AUDITED)
Non-Audit Services
During the financial year the Company’s external auditor, Grant Thornton Audit Pty Ltd, performed certain other
services in addition to its statutory audit duties.
The Board has considered the non-audit services provided during the financial year by the external auditor and
is satisfied that the provision of those non-audit services is compatible with, and did not compromise, the auditor
independence requirements of the Corporations Act 2001 for the following reasons:
(a) all non-audit services were subject to the corporate governance procedures adopted by the Company and
have been reviewed by the Directors to ensure they do not impact upon the impartiality and objectivity of the
external auditor; and
(b) the non-audit services do not undermine the general principles relating to auditor independence as set out
in APES 110 ‘Code of Ethics for Professional Accountants’, as they did not involve reviewing or auditing the
external auditor’s own work, acting in a management or decision-making capacity for the Company, acting
as an advocate for the Company or jointly sharing risks and rewards.
Details of the amounts paid or payable to the external auditor for audit and non-audit services provided during
the financial year are set out in Note 4 to the consolidated financial statements.
External Auditor’s Independence Declaration
A copy of the external Auditor’s Independence Declaration for the financial year, as required under
Section 307C of the Corporations Act 2001, is included on page 28.
This Directors’ Report is made in accordance with a resolution of the Board of Directors.
On behalf of the Board of Directors:
Dr Christopher Giles
Executive Director
25 October 2021
Mr Simon Gray
Executive Chairman
Page 27
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(cid:71)(cid:72)(cid:79)(cid:76)(cid:89)(cid:72)(cid:85)(cid:72)(cid:71)(cid:3)(cid:69)(cid:92)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:80)(cid:72)(cid:80)(cid:69)(cid:72)(cid:85)(cid:3)(cid:73)(cid:76)(cid:85)(cid:80)(cid:86)(cid:17)(cid:3)(cid:42)(cid:55)(cid:44)(cid:47)(cid:3)(cid:71)(cid:82)(cid:72)(cid:86)(cid:3)(cid:81)(cid:82)(cid:87)(cid:3)(cid:83)(cid:85)(cid:82)(cid:89)(cid:76)(cid:71)(cid:72)(cid:3)(cid:86)(cid:72)(cid:85)(cid:89)(cid:76)(cid:70)(cid:72)(cid:86)(cid:3)(cid:87)(cid:82)(cid:3)(cid:70)(cid:79)(cid:76)(cid:72)(cid:81)(cid:87)(cid:86)(cid:17)(cid:3)(cid:42)(cid:55)(cid:44)(cid:47)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:76)(cid:87)(cid:86)(cid:3)(cid:80)(cid:72)(cid:80)(cid:69)(cid:72)(cid:85)(cid:3)(cid:73)(cid:76)(cid:85)(cid:80)(cid:86)(cid:3)(cid:68)(cid:85)(cid:72)(cid:3)(cid:81)(cid:82)(cid:87)(cid:3)(cid:68)(cid:74)(cid:72)(cid:81)(cid:87)(cid:86)(cid:3)(cid:82)(cid:73)(cid:15)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:71)(cid:82)(cid:3)(cid:81)(cid:82)(cid:87)(cid:3)(cid:82)(cid:69)(cid:79)(cid:76)(cid:74)(cid:68)(cid:87)(cid:72)(cid:3)(cid:82)(cid:81)(cid:72)(cid:3)
(cid:68)(cid:81)(cid:82)(cid:87)(cid:75)(cid:72)(cid:85)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:68)(cid:85)(cid:72)(cid:3)(cid:81)(cid:82)(cid:87)(cid:3)(cid:79)(cid:76)(cid:68)(cid:69)(cid:79)(cid:72)(cid:3)(cid:73)(cid:82)(cid:85)(cid:3)(cid:82)(cid:81)(cid:72)(cid:3)(cid:68)(cid:81)(cid:82)(cid:87)(cid:75)(cid:72)(cid:85)(cid:182)(cid:86)(cid:3)(cid:68)(cid:70)(cid:87)(cid:86)(cid:3)(cid:82)(cid:85)(cid:3)(cid:82)(cid:80)(cid:76)(cid:86)(cid:86)(cid:76)(cid:82)(cid:81)(cid:86)(cid:17)(cid:3)(cid:44)(cid:81)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:36)(cid:88)(cid:86)(cid:87)(cid:85)(cid:68)(cid:79)(cid:76)(cid:68)(cid:81)(cid:3)(cid:70)(cid:82)(cid:81)(cid:87)(cid:72)(cid:91)(cid:87)(cid:3)(cid:82)(cid:81)(cid:79)(cid:92)(cid:15)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:88)(cid:86)(cid:72)(cid:3)(cid:82)(cid:73)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:87)(cid:72)(cid:85)(cid:80)(cid:3)(cid:181)(cid:42)(cid:85)(cid:68)(cid:81)(cid:87)(cid:3)(cid:55)(cid:75)(cid:82)(cid:85)(cid:81)(cid:87)(cid:82)(cid:81)(cid:182)(cid:3)(cid:80)(cid:68)(cid:92)(cid:3)(cid:85)(cid:72)(cid:73)(cid:72)(cid:85)(cid:3)(cid:87)(cid:82)(cid:3)
(cid:42)(cid:85)(cid:68)(cid:81)(cid:87)(cid:3)(cid:55)(cid:75)(cid:82)(cid:85)(cid:81)(cid:87)(cid:82)(cid:81)(cid:3)(cid:36)(cid:88)(cid:86)(cid:87)(cid:85)(cid:68)(cid:79)(cid:76)(cid:68)(cid:3)(cid:47)(cid:76)(cid:80)(cid:76)(cid:87)(cid:72)(cid:71)(cid:3)(cid:36)(cid:37)(cid:49)(cid:3)(cid:23)(cid:20)(cid:3)(cid:20)(cid:21)(cid:26)(cid:3)(cid:24)(cid:24)(cid:25)(cid:3)(cid:22)(cid:27)(cid:28)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:76)(cid:87)(cid:86)(cid:3)(cid:36)(cid:88)(cid:86)(cid:87)(cid:85)(cid:68)(cid:79)(cid:76)(cid:68)(cid:81)(cid:3)(cid:86)(cid:88)(cid:69)(cid:86)(cid:76)(cid:71)(cid:76)(cid:68)(cid:85)(cid:76)(cid:72)(cid:86)(cid:3)(cid:68)(cid:81)(cid:71)(cid:3)(cid:85)(cid:72)(cid:79)(cid:68)(cid:87)(cid:72)(cid:71)(cid:3)(cid:72)(cid:81)(cid:87)(cid:76)(cid:87)(cid:76)(cid:72)(cid:86)(cid:17)(cid:3)(cid:42)(cid:55)(cid:44)(cid:47)(cid:3)(cid:76)(cid:86)(cid:3)(cid:81)(cid:82)(cid:87)(cid:3)(cid:68)(cid:81)(cid:3)(cid:36)(cid:88)(cid:86)(cid:87)(cid:85)(cid:68)(cid:79)(cid:76)(cid:68)(cid:81)(cid:3)(cid:85)(cid:72)(cid:79)(cid:68)(cid:87)(cid:72)(cid:71)(cid:3)(cid:72)(cid:81)(cid:87)(cid:76)(cid:87)(cid:92)(cid:3)(cid:87)(cid:82)(cid:3)
(cid:42)(cid:85)(cid:68)(cid:81)(cid:87)(cid:3)(cid:55)(cid:75)(cid:82)(cid:85)(cid:81)(cid:87)(cid:82)(cid:81)(cid:3)(cid:36)(cid:88)(cid:86)(cid:87)(cid:85)(cid:68)(cid:79)(cid:76)(cid:68)(cid:3)(cid:47)(cid:76)(cid:80)(cid:76)(cid:87)(cid:72)(cid:71)(cid:17)(cid:3)
Liability limited by a scheme approved under Professional Standards Legislation.
(cid:90)(cid:90)(cid:90)(cid:17)(cid:74)(cid:85)(cid:68)(cid:81)(cid:87)(cid:87)(cid:75)(cid:82)(cid:85)(cid:81)(cid:87)(cid:82)(cid:81)(cid:17)(cid:70)(cid:82)(cid:80)(cid:17)(cid:68)(cid:88)
Page 28
(cid:3)
(cid:3)
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
Revenue
Other income
Fair value (loss) gain on financial assets
Employee benefits expense (net)
Depreciation expense
Impairment of plant and equipment
Write-down of CMC receivable
Extraordinary General Meeting expenses
Finance costs
Exploration and evaluation expenditure expensed
Impairment of capitalised exploration & evaluation expenditure
10
Share registrar, ASIC and ASX listing fees
Insurance expense
Investor relations cost
Consulting fees
Other expenses
Loss before income tax
Income tax expense
Loss for financial year attributable to equity holders of the
Company
Financial Year Ended
Note
31 July 2021
31 July 2020
$
$
4
4
149,480
521,322
12(a)
(319,583)
123,213
1,170,083
825,996
4
4
11
4
(1,450,748)
(2,069,925)
(95,642)
-
-
-
(55,579)
(398,878)
-
(193,056)
(109,482)
(148,514)
(63,310)
(197,880)
(309,864)
(200,000)
(2,595,451)
(404,841)
(177,724)
(374,322)
(106,687)
(156,057)
(136,308)
(65,031)
(161,014)
(88,497)
(2,361,870)
(4,726,429)
6(a)
-
-
(2,361,870)
(4,726,429)
Other comprehensive income for financial year, net of income
tax
Total comprehensive loss for financial year attributable to
equity holders of the Company
-
-
(2,361,870)
(4,726,429)
Loss per share attributable to equity holders of the
Company:
Basic and diluted loss per ordinary share
3
Cents
(0.80)
Cents
(1.90)
The accompanying notes form an integral part of these consolidated financial statements.
Page 29
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Current assets
Cash and cash equivalents
Trade and other receivables
Other assets
Total current assets
Non-current assets
Exploration and evaluation expenditure
Property, plant and equipment
Other financial assets
Total non-current assets
Total assets
Current liabilities
Trade and other payables
Borrowings
Provisions
Other financial liabilities
Total current liabilities
Non-current liabilities
Borrowings
Deferred grants
Total non-current liabilities
Total liabilities
Net assets
Equity
Contributed equity
Accumulated losses
Share-based payments reserve
Buy-out reserve
Total equity
Note
31 July 2021
Restated
31 July 2020
$
$
7(a)
4,007,410
1,483,724
8
9
10
11
12
13
14
15
16
14
17
62,996
83,069
102,358
89,193
4,153,475
1,675,275
37,346,924
35,569,590
2,584,182
600,834
40,531,940
44,685,415
2,667,508
920,417
39,157,515
40,832,790
675,953
10,376
571,219
158,706
470,253
75,361
519,308
542,340
1,416,254
1,607,262
53,457
111,500
164,957
63,869
-
63,869
1,581,211
1,671,131
43,104,204
39,161,659
18(a)
82,829,843
76,906,563
(38,378,583)
(36,090,969)
1,252,741
945,862
(2,599,797)
(2,599,797)
43,104,204
39,161,659
The accompanying notes form an integral part of these consolidated financial statements.
Page 30
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Contributed
Equity
Accumulated
Losses
Share-
based
Payments
Reserve
Buy-out
Reserve Total Equity
$
$
$
$
$
Balance as at 31 July 2019
71,674,794
(31,421,839)
681,360
(2,599,797)
38,334,518
Loss for financial year
Other comprehensive income
Total comprehensive loss for
financial year
Transactions with owners in their
capacity as owners:
Ordinary shares issued
Transaction costs arising on ordinary
shares issued
Unlisted options lapsed
Share-based payments expense
-
-
-
(4,726,429)
-
(4,726,429)
5,273,978
(42,209)
-
-
-
-
-
-
-
-
-
57,299
(57,299)
-
321,801
-
-
-
-
-
-
-
(4,726,429)
-
(4,726,429)
5,273,978
(42,209)
-
321,801
Balance as at 31 July 2020
76,906,563
(36,090,969)
945,862
(2,599,797)
39,161,659
Loss for financial year
Other comprehensive income
Total comprehensive loss for
financial year
Transactions with owners in their
capacity as owners:
Ordinary shares issued
Transaction costs arising on ordinary
shares issued
Unlisted options lapsed
Share-based payments expense
-
-
-
(2,361,870)
-
(2,361,870)
6,006,400
(83,120)
-
-
-
-
-
-
-
-
-
74,256
(74,256)
-
381,135
-
-
-
-
-
-
-
(2,361,870)
-
(2,361,870)
6,006,400
(83,120)
-
381,135
Balance as at 31 July 2021
82,829,843
(38,378,583)
1,252,741
(2,599,797)
43,104,204
The accompanying notes form an integral part of these consolidated financial statements.
Page 31
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
CONSOLIDATED STATEMENT OF CASH FLOWS
Financial Year Ended
Note
31 July 2021
31 July 2020
$
$
Cash flows from operating activities
Receipts from customers
COVID-19 grants received
Government grants received for exploration activities
17
Interest received
254,665
207,800
111,500
364
85,758
147,852
-
9,298
Payments to suppliers and employees
(1,696,367)
(3,041,180)
Payments for exploration and evaluation expenditure expensed
Repayment of Research & Development
Interest and other costs of finance paid
(398,878)
-
(9,860)
(374,322)
(342,742)
(177,724)
Net cash flows used in operating activities
7(b)
(1,530,776)
(3,693,060)
Cash flows from investing activities
Payments for exploration and evaluation expenditure capitalised
Payments for property, plant and equipment
Proceeds from disposal of non-current assets
Net cash flows used in investing activities
Cash flows from financing activities
Proceeds from issue of ordinary shares
Payment of ordinary share issue costs
Proceeds from borrowings
Repayments of borrowings
Principal element of lease payments
Net cash flows provided by financing activities
(1,777,334)
(16,087)
-
(966,946)
(123,547)
4,000
(1,793,421)
(1,086,493)
6,006,400
(83,120)
-
5,273,978
(42,209)
79,291
(75,397)
(2,661,695)
-
5,847,883
(205,734)
2,443,631
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of financial year
2,523,686
1,483,724
(2,335,922)
3,819,646
Cash and cash equivalents at end of financial year
7(a)
4,007,410
1,483,724
The accompanying notes form an integral part of these consolidated financial statements.
Page 32
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 1. Basis of Preparation of the Consolidated Financial Statements
Havilah Resources Limited (‘Havilah’, ‘Company’ or ‘Parent Company’) is a for-profit entity for the purpose of
preparing financial statements.
The consolidated financial statements are for the consolidated entity consisting of the Company and its
subsidiaries (the ‘Group’). Information on the nature of the operations and principal activities of the Group are
described in the Directors’ Report. Interests in subsidiaries are set out in Note 20.
This note sets out the basis upon which the consolidated financial statements are prepared as a whole.
Significant accounting policies adopted by the Group in the preparation of these consolidated financial
statements, and relevant to an understanding thereof, are described in selected notes to the consolidated
financial statements or are otherwise provided in this note. The accounting policies have been consistently
applied to all the financial years presented, unless otherwise stated.
These general purpose financial statements have been prepared in accordance with Australian Accounting
Standards and Interpretations issued by the Australian Accounting Standards Board and the Corporations Act
2001.
The consolidated financial statements have been prepared on the basis of historical cost, except for the
revaluation of certain non-current assets and financial instruments. Cost is based on the fair values of the
consideration given in exchange for assets.
Where necessary, comparative information has been reclassified to achieve consistency in disclosure with
financial year amounts and other disclosures.
Functional and Presentation Currency
The consolidated financial statements are presented in Australian dollars, which is the Parent Company’s
functional and presentation currency. Amounts are rounded to the nearest dollar.
Significant Accounting Estimates, Assumptions and Judgements
The preparation of financial statements requires the use of certain significant accounting estimates. It also
requires management to exercise its judgement in the process of applying Group accounting policies. The areas
involving a high degree of judgement or complexity, or areas where assumptions and estimates are significant to
the consolidated financial statements, are disclosed in Notes 6, 10, 12 and 25.
Change in Accounting Policy
The Group previously recognised government grants received for exploration activities as deferred grants to be
offset against any future amortisation of the related exploration and evaluation expenditure.
During the financial year the Group changed its accounting policy such that government grants received relating
to capitalised exploration and evaluation expenditure are now credited directly against the exploration and
evaluation assets to which they relate to match the grants received with the expenditure the grants are intended
to compensate.
The impact of the change in accounting policy has been to restate the comparative financial period to match the
current accounting policy:
Exploration and evaluation expenditure (refer Note 10)
36,244,499
(674,909)
Trade and other payables (refer Note 13)
Deferred grants (refer Note 17)
(469,253)
(675,909)
(1,000)
675,909
Previously
stated
Impact of
restatement
$
$
Restated
31 July 2020
$
35,569,590
(470,253)
-
Statement of Compliance with International Financial Reporting Standards
Compliance with Australian Accounting Standards ensures that the consolidated financial statements comply
with International Financial Reporting Standards as issued by the International Accounting Standards Board.
Page 33
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 2. Going Concern
The consolidated financial statements are prepared on the going concern basis, which assumes continuity of
normal business activities and the realisation of assets and settlement of liabilities and commitments in the
normal course of business.
During the financial year ended 31 July 2021, the Group recognised a loss of $2,361,870, had net cash outflows
from operating and investing activities of $3,324,197; and had accumulated losses of $38,378,583 as at
31 July 2021. In addition, the impacts of the COVID-19 pandemic, which continued during the financial year, are
uncertain and it is possible that there may be subdued activity over the next 12 months from the date of signing
the Directors’ Declaration.
The continuation of the Group as a going concern is dependent upon its ability to generate sufficient net cash
inflows from operating and financing activities and manage the level of exploration and other expenditure within
available cash resources. The Directors consider that the going concern basis of accounting is appropriate as
the Group has the following options:
•
•
•
•
the ability to issue share capital under the Corporations Act 2001 by a share purchase plan,
share placement or rights issue;
the option of farming out all or part of its assets;
the option of selling interests in the Group’s assets; and
the option of relinquishing or disposing of rights and interests in certain assets.
In the event that the Group is unsuccessful in implementing one or more of the funding options listed above,
such circumstances would indicate that a material uncertainty exists that may cast significant doubt as to
whether the Company will continue as a going concern and therefore whether it will realise its assets and
discharge its liabilities in the normal course of business and at the amounts stated in the Group’s financial
statements and notes.
The consolidated financial statements do not include any adjustments relating to the recoverability and
classification of recorded asset amounts or to the amounts and classification of liabilities that might be
necessary should the Company not continue as a going concern.
Note 3. Earnings per Share
The Group discloses relevant basic and diluted earnings per share data for its ordinary shares. Basic is
calculated by dividing the profit or loss attributable to equity holders of the Company by the weighted average
number of ordinary shares on issue during the financial year.
Diluted loss per ordinary share equates to basic loss per ordinary share because a loss per ordinary share is not
considered dilutive for the purposes of calculating earnings per share pursuant to AASB 133 ‘Earnings per
Share’.
Financial Year Ended
31 July 2021
31 July 2020
Loss per share attributable to equity holders of the Company:
Basic and diluted loss per ordinary share
Cents
(0.80)
Cents
(1.90)
Loss for financial year attributable to equity holders of the Company
used to calculate basic and diluted loss per ordinary share
$
$
(2,361,870)
(4,726,429)
Weighted average number of ordinary shares on issue during financial
year used in calculating basic and diluted loss per ordinary share
294,016,706
249,252,740
Page 34
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 4. Results for the Financial Year
The results for the financial year include the following specific revenues and expenses:
Revenue
Royalty revenue from Portia Gold Mine
Sales revenue associated with gold inventory
Total revenue
Other Income
Interest income from unrelated entities
COVID-19 grants received
Diesel fuel rebates received
SIMEC Mining exclusivity payment
Gain on disposal of plant and equipment
ATO settlement (net) (refer (a) below)
Other sundry income
Total other income
(a) ATO settlement on Research & Development amendment:
Gross settlement proceeds
Costs associated with settlement
ATO settlement (net)
Expenses
Employee benefits expense (net):
Financial Year Ended
31 July 2021
31 July 2020
$
$
149,480
-
149,480
364
207,800
25,836
-
-
267,062
20,260
521,322
415,882
(148,820)
267,062
120,993
2,220
123,213
9,298
147,852
8,933
1,000,000
4,000
-
-
1,170,083
-
-
-
- Employee benefits expense (refer (b) below)
(1,222,241)
(1,736,465)
- Capitalisation of employee benefits expense to exploration
490,429
320,200
expenditure
- Directors’ remuneration
- Share-based payments expense (refer Note 25)
Total employee benefits expense (net)
Depreciation expense:
- Depreciation expense – Property, plant and equipment
- Depreciation expense – Right-of-use assets
Total depreciation expense
Finance costs:
- Interest expense
- Interest element on lease liabilities
- Bank fees
Total finance costs
(b) Represents employee benefits expenses (short-term, post-employment and long-term).
(337,801)
(381,135)
(331,859)
(321,801)
(1,450,748)
(2,069,925)
(95,642)
-
(95,642)
(42,105)
-
(13,474)
(55,579)
(97,375)
(212,489)
(309,864)
(142,565)
(18,992)
(16,167)
(177,724)
Page 35
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 4. Results for the Financial Year (continued)
Remuneration of External Auditor
Remuneration received or due and receivable by the external auditor of the Company:
(i) Grant Thornton Audit Pty Ltd
Audit or review of financial reports
Total remuneration for audit and other assurance services
Taxation services
Total remuneration for other services
Total remuneration of Grant Thornton Audit Pty Ltd
(ii) Deloitte Touche Tohmatsu
Additional costs invoiced by Deloitte for the 2019 financial year audit
Total remuneration for audit and other assurance services
Total remuneration of external auditor
Financial Year Ended
31 July 2021
31 July 2020
$
$
49,317
49,317
7,000
7,000
56,317
-
-
56,317
48,100
48,100
-
-
48,100
23,195
23,195
71,295
Significant Accounting Policy: Impairment of Assets (except exploration & evaluation; financial assets)
At the end of each reporting period, the Group reviews the carrying amounts of its tangible and intangible assets
to determine whether there is any indication that those assets have suffered an impairment loss. If any such
indication exists, the recoverable amount of the asset is estimated to determine the extent of the impairment
loss, if any. Where the asset does not guarantee cash flows that are independent from other assets, the Group
estimates the recoverable amount of the cash-generating unit to which the asset belongs.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the
estimated future cash flows are discounted to their present value using a pre-tax interest rate that reflects
current market assessments of the time value of money and the risks specific to the asset for which the
estimates of future cash flows have not been adjusted. If the recoverable amount of an asset (or cash-
generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (cash-
generating unit) is reduced to its recoverable amount. An impairment loss is recognised in profit or loss
immediately, unless the relevant asset is carried at fair value, in which case the impairment loss is treated as a
revaluation decrease.
Significant Accounting Policy: Government Grants
Government grants receivable as compensation for expenses or losses already incurred or for the purpose of
giving immediate financial support to the Group with no future related costs are recognised as income in the
reporting period in which the funds become receivable, in accordance with AASB 120 'Accounting for
Government Grants and Disclosures of Government Assistance'.
Grants relating to capitalised exploration and evaluation expenditure are credited against the exploration and
evaluation assets to which they relate to match the grants received with the expenditure the grants are intended
to compensate, in accordance with AASB 120 'Accounting for Government Grants and Disclosures of
Government Assistance'. As outlined in Note 1 – this is a change in accounting policy from prior periods.
Note 5. Segment Information
The Group has a number of exploration tenements, mining leases, miscellaneous purposes licences and
mineral claims in South Australia, which it manages on a portfolio basis. The decision to allocate resources to
individual projects in the portfolio is predominantly based on available cash assets, technical data and the
expectation of future metal prices. The Group operates as one segment being exploration for and evaluation of
mineral resources in South Australia. This is the basis on which its internal reports are reviewed and used by
the Board of Directors (the ‘chief operating decision maker’) in monitoring, assessing performance, and in
determining the allocation of resources.
The results, assets and liabilities from this segment are equivalent to the consolidated financial statements.
Page 36
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 6. Income Tax
(a) Income Tax Recognised in Profit or Loss
The prima facie consolidated tax on loss before income tax is reconciled
to income tax expense as follows:
Prima facie tax payable on loss before income tax, calculated at the
Australian tax rate of 26% (2020: 27.5%)
Share-based payments expense
Other
Timing differences not bought to account
Revenue tax losses not recognised
Prior under (over) provision
Income tax expense
Financial Year Ended
31 July 2021
31 July 2020
$
$
(614,086)
(1,299,767)
99,095
(78,443)
593,434
-
-
-
88,495
53,142
-
330,858
827,272
-
31 July 2021
31 July 2020
$
$
(b) Deferred Tax Balances
Deferred tax assets and (liabilities) are attributable to the following:
Temporary differences
Exploration and evaluation expenditure
(10,044,479)
(9,967,237)
Plant and equipment
Other financial assets
Employee benefit provisions
Other
Deferred income
Transaction costs arising on ordinary shares issued
Total
Offset by deferred tax assets relating to operating losses
Net deferred tax assets and (liabilities) unrecognised
(11,585)
52,974
152,840
9,100
-
95,006
16,132
(231,205)
142,810
-
185,600
-
(9,746,144)
(9,853,900)
9,746,144
9,853,900
-
-
(c) Unrecognised Deferred Tax Assets
Deferred tax assets have not been recognised in respect of the following items:
Revenue tax losses
Capital tax losses
Total unrecognised deferred tax assets
9,672,065
9,622,878
-
-
9,672,065
9,622,878
Deferred tax assets have not been recognised in respect of these items because it is not probable, at this time,
that future taxable profit will be available against which the Group can utilise the tax benefits.
Page 37
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 6. Income Tax (continued)
(d) Tax Consolidation
Relevance of tax consolidation to the Group
With effect from 1 July 2003, the Company and its wholly-owned Australian resident subsidiaries formed a tax-
consolidated group and are taxed as a single entity. The head entity within the tax-consolidated group is Havilah
Resources Limited. The members of the tax-consolidated group are identified at Note 20.
Nature of tax funding arrangements and tax sharing agreements
Entities within the tax-consolidated group have entered into a tax-funding arrangement and a tax-sharing
arrangement with the head entity. Under the terms of the tax-funding arrangement, Havilah Resources Limited
and each of the entities in the tax-consolidated group has agreed to pay a tax equivalent payment to or from the
head entity based on the current tax liability or current tax asset of the entity. Such amounts are reflected in
amounts receivable from or payable to other entities in the tax-consolidated group.
The tax-sharing agreement entered into between members of the tax-consolidated group provides for the
determination of the allocation of income tax liabilities between the entities should the head entity default on its
tax payment obligations or if an entity should leave the tax-consolidated group. The effect of the tax-sharing
agreement is that each member’s liability for tax payable by the tax-consolidated group is limited to the amount
payable to the head entity under the tax-funding agreement.
(e) Significant Accounting Policies:
Income Taxes
Tax expense recognised in profit or loss comprises the sum of deferred tax and current tax not recognised in
other comprehensive income or directly in equity.
Calculation of current tax is based on tax rates and tax laws that have been enacted or substantively enacted by
the end of the reporting period. Deferred income taxes are calculated using the balance sheet liability method.
Deferred tax assets are recognised to the extent that it is probable that the underlying tax loss or deductible
temporary difference will be utilised against future taxable income. This is assessed based on the Group’s
forecast of future operating results, adjusted for significant non-taxable income and expenses and specific limits
on the use of any unused tax loss.
Deferred tax liabilities are generally recognised in full.
Goods and Services Tax (‘GST’)
Revenues, expenses and assets are recognised net of the amount of GST, except: where the amount of GST
incurred is not recoverable from the taxation authority, it is recognised as part of the cost of acquisition of an
asset or as part of an item of expense; or for receivables and payables which are recognised inclusive of GST.
The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables
or payables. Cash flows are included in the consolidated statement of cash flows on a gross basis. The GST
component of cash flows arising from investing and financing activities which is recoverable from, or payable to,
the taxation authority is classified as operating cash flows.
Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the
taxation authority.
(f) Significant Accounting Estimates, Assumptions and Judgements: Deferred Tax Assets
The Group’s ability to recognise deferred tax assets relies on assumptions about the generation of future
taxable profits. These taxable profit estimates are based on estimated future production, commodity prices,
exchange rates, operating costs, rehabilitation costs and capital expenditures. To the extent that future
utilisation of these tax losses and temporary tax differences become probable, this could result in significant
changes to deferred tax assets recognised, which would in turn impact future financial results.
Page 38
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 7. Cash and Cash Equivalents
(a) For the purposes of the consolidated statement of cash flows, cash and cash equivalents comprise:
Cash at banks and on hand
Total cash and cash equivalents
31 July 2021
31 July 2020
$
4,007,410
4,007,410
$
1,483,724
1,483,724
Financial Risk Management
Information concerning the Group’s exposure to financial risks on cash and cash equivalents is set out in
Note 19.
(b) Reconciliation of Cash Flows used in Operating Activities
Loss for financial year
Non-cash items included in loss for financial year:
Fair value loss (gain) on financial assets
Write-down of CMC receivable
SIMEC Mining exclusivity payment
Impairment of capitalised exploration & evaluation expenditure
Share-based payments expense
Depreciation expense property plant and equipment
Impairment of plant and equipment
Depreciation expense right-of-use assets
Security deposit forfeited
Other
Items classified as investing or financing activities:
Proceeds from sale fixed assets
Amortisation of insurance premium funding
Changes in operating assets and liabilities:
(Increase)/decrease in assets
Trade and other receivables
Other current assets
Increase/(decrease) in liabilities:
Trade and other payables
Provisions
Other financial liabilities
Deferred grants
Financial Year Ended
31 July 2021
31 July 2020
$
$
(2,361,870)
(4,726,429)
319,583
-
-
-
381,135
95,642
-
-
-
3,771
(825,996)
2,595,451
(1,000,000)
106,687
321,801
97,375
200,000
212,489
15,000
-
-
64,985
(4,000)
156,649
39,362
(58,861)
205,700
51,911
(383,634)
111,500
(55,686)
(41,862)
(295,375)
(106,422)
(342,742)
-
Net cash flows used in operating activities
(1,530,776)
(3,693,060)
Page 39
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 7. Cash and Cash Equivalents (continued)
(c) Total Liabilities from Financing Activities
Balance as at 31 July 2019
Recognised upon AASB 16 ‘Leases’
transition as at 1 August 2019 (non-cash)
Recognised upon origination (non-cash)
Proceeds from borrowing
Repayment of borrowing
Principal element of lease payments
Re-evaluation of lease term (non-cash)
Balance as at 31 July 2020
Proceeds from borrowing
Repayment of borrowing
Balance as at 31 July 2021
Note 8. Trade and Other Receivables
Current
Trade receivables
GST recoverable
Total current trade and other receivables
Investec loan
$
2,500,000
-
-
-
Hire purchase
loan
$
-
-
-
79,291
Insurance
premium
funding
$
132,486
Lease
liabilities
$
-
-
526,470
89,148
-
-
-
-
(2,500,000)
(5,046)
(156,649)
-
-
-
-
-
-
-
-
-
-
(205,734)
(320,736)
74,245
64,985
-
-
(10,412)
(64,985)
63,833
-
-
-
-
-
31 July 2021
$
31 July 2020
$
-
62,996
62,996
38,876
63,482
102,358
Financial Risk Management
Information concerning the Group’s exposure to financial risks on trade and other receivables is set out in
Note 19.
Note 9. Other Assets
Current
Prepayments
Total current other assets
31 July 2021
$
31 July 2020
$
83,069
83,069
89,193
89,193
Page 40
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 10. Exploration and Evaluation Expenditure
Cost brought forward
Expenditure incurred during the financial period
Costs reimbursed by SIMEC Mining
Impairment of capitalised exploration and evaluation expenditure
Total expenditure and evaluation expenditure carried forward
Intangible
* Refer to Note 1 for details of the restatement.
31 July 2021
$
35,569,590
1,777,334
-
-
37,346,924
37,346,924
Restated*
31 July 2020
$
34,849,188
966,946
(139,857)
(106,687)
35,569,590
35,569,590
A review of the Group’s exploration and evaluation tenement portfolio was conducted during the financial year,
which resulted in no impairments from tenement expiry and/or relinquishment (2020: $106,687).
The expenditure is carried forward on the basis that exploration and evaluation activities in the areas of interest
have not reached a stage that permits reasonable assessment of the existence or otherwise of economically
recoverable reserves and active and significant operations in, or in relation to, the areas is continuing. The future
recoverability of the carrying amount of capitalised exploration and evaluation expenditure is dependent on
successful development and commercial exploitation or, alternatively, the sale of the respective areas of
interest.
Significant Accounting Policy: Exploration and Evaluation Expenditure
Exploration and evaluation expenditures in relation to each separate area of interest are recognised as
exploration and evaluation expense in the reporting period in which they are incurred, except where the
following conditions are satisfied:
•
•
the rights to tenure of the area of interest are current; and
at least one of the following conditions is also met:
−
−
the exploration and evaluation expenditures are expected to be recouped through successful
development and exploitation of the area of interest, or alternatively, by its sale; or
exploration and evaluation activities in the area of interest have not at the reporting period reached a
stage which permits a reasonable assessment of the existence or otherwise of economically
recoverable reserves, and active and significant operations in, or in relation to, the area of interest are
continuing.
Exploration and evaluation assets are initially measured at cost, as an intangible, and include acquisition of
rights to explore, costs of studies, exploration drilling, trenching and sampling and associated activities.
General and administrative costs are only included in the measurement of exploration and evaluation costs
where they relate directly to operational activities in a particular area of interest.
Exploration and evaluation assets are assessed for impairment when facts and circumstances (as defined in
AASB 6 ‘Exploration for and Evaluation of Mineral Resources’) suggest that the carrying amount of exploration
and evaluation assets may exceed their recoverable amount. The recoverable amount of the exploration and
evaluation assets (or the cash-generating unit(s) to which they have been allocated, being no larger than the
relevant area of interest) is estimated to determine the extent of the impairment loss, if any.
Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the revised
estimate of its recoverable amount, but only to the extent that the increased carrying amount does not exceed
the carrying amount that would have been determined had no impairment loss been recognised for the asset in
prior financial years.
Where a decision is made to proceed with development in respect of a particular area of interest, the relevant
exploration and evaluation asset is tested for impairment and reclassified to mine development expenditure.
Page 41
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 10. Exploration and Evaluation Expenditure (continued)
Significant Accounting Estimates, Assumptions and Judgements: Exploration & Evaluation Expenditure
The application of the Group’s accounting policy for exploration and evaluation expenditure requires judgement
in determining whether future economic benefits are likely either from future exploitation or sale or where
activities have not reached a stage that permits a reasonable assessment of the existence of economically
recoverable reserves. The determination of a JORC Mineral Resource is itself an estimation process that
requires varying degrees of uncertainty depending on sub-classification and these estimates directly impact the
point of deferral of exploration and evaluation expenditure. The deferral policy requires management to make
certain estimates and assumptions about future events or circumstances, in particular whether an economically
viable extraction operation can be established. Estimates and assumptions made may change if new information
becomes available.
Information on the reasonable existence or otherwise of economically recoverable reserves is progressively
gained through geological analysis and interpretation, drilling activity and prospect evaluation during a normal
exploration tenement term. A reasonable assessment of the existence or otherwise of economically recoverable
reserves can generally only be made, therefore, at the conclusion of those exploration and evaluation activities.
To the extent that capitalised exploration and evaluation expenditure is determined not to be recoverable in the
future, the relevant capitalised amount will be impaired in profit or loss and net assets will be reduced during the
financial period in which this determination is made.
Note 11. Property, Plant and Equipment
Cost brought forward
Balance as at 31 July 2019
Additions
Impairment
Balance as at 31 July 2020
Additions
Assets scrapped
Balance as at 31 July 2021
Accumulated depreciation
Balance as at 31 July 2019
Depreciation expense
Balance as at 31 July 2020
Depreciation expense
Depreciation assets scrapped
Balance as at 31 July 2021
Net Book Value:
As at 31 July 2020
As at 31 July 2021
Pastoral lease
at cost 1
$
2,241,043
-
-
2,241,043
-
-
2,241,043
-
-
-
-
-
-
Plant and equipment
$
3,952,310
123,546
(200,000)
3,875,856
16,087
(6,818)
3,885,125
(3,352,016)
(97,375)
(3,449,391)
(95,642)
3,047
(3,541,986)
Total
$
6,193,353
123,546
(200,000)
6,116,899
16,087
(6,818)
6,126,168
(3,352,016)
(97,375)
(3,449,391)
(95,642)
3,047
(3,541,986)
2,241,043
2,241,043
426,465
343,139
2,667,508
2,584,182
1 The Group has bank guarantee and overdraft facilities with the National Australia Bank Limited secured by a
$1,000,000 mortgage over the Kalkaroo Station pastoral lease (classified as ‘Pastoral lease at cost’ in this Note).
Page 42
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 11. Property, Plant and Equipment (continued)
Significant Accounting Policy: Property, Plant and Equipment
Pastoral leases are stated at cost less impairment. Cost includes expenditure that is directly attributable to the
acquisition of the pastoral lease. The Group considers its pastoral lease rights to be indefinite and cost is not
depreciated.
Plant and equipment is stated at cost less accumulated depreciation and impairment. Cost includes expenditure
that is directly attributable to the acquisition of the item. In the event that settlement of all or part of the purchase
consideration is deferred, cost is determined by discounting the amounts payable in the future to their present
value as at the date of acquisition.
Depreciation is provided on plant and equipment. Depreciation is calculated on a straight-line basis so as to
write-down the net cost of each asset over its expected useful life to its estimated residual value. The following
estimated useful lives are used in the calculation of depreciation:
computer and office equipment: 2.5 – 10 years
•
• motor vehicles: 8 – 10 years
•
•
•
•
operating equipment: 2.5 – 10 years
heavy equipment: 8 – 10 years
rail, water and other infrastructure: 8 – 10 years
portable dewatering infrastructure: 7 – 25 years
The estimated useful lives, residual values and depreciation method are reviewed at the end of each annual
reporting period and adjusted if appropriate.
Note 12. Other Financial Assets
Non-current
At amortised cost:
31 July 2021
31 July 2020
$
$
Bank term deposits (refer Note 23(a))
60,000
60,000
At fair value (investment in equity instruments designated FVTPL):
Shares in a listed ASX entity (refer (a) below)
Total non-current other financial assets
540,834
600,834
860,417
920,417
(a) The Group’s financial assets designated as FVTPL (Fair value through profit or loss) comprise
4,916,667 fully paid ordinary shares held in ASX listed Auteco Minerals Ltd. Fair value is based on the last
traded price (ASX issuer code: AUT) at the end of the reporting period. The FVTPL loss for the financial year
was $319,583 (2020: gain $825,996).
Significant Accounting Estimates, Assumptions and Judgements: Impairment of Financial Assets
In assessing impairment, management estimates the recoverable amount of each asset or cash-generating unit
based on expected
them.
flows and uses an estimated
Estimation uncertainty relates to assumptions about future operating results and the determination of a suitable
interest rate. The loss allowance for a financial asset is based on assumptions about risk of default and
expected loss rates. The Group uses judgement in making these assumptions and selecting the inputs to the
impairment calculation based on its assessment of available external credit ratings, historical loss rates and/or
days past due.
future cash
to discount
interest
rate
Financial Risk Management
Information concerning the Group’s exposure to financial risks on other financial assets is set out in Note 19.
Page 43
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 13. Trade and Other Payables
Current (unsecured)
Trade payables
Sundry payables and accruals
Total current trade and other payables
* Refer to Note 1 for details of the restatement.
31 July 2021
Restated*
31 July 2020
$
$
294,617
381,336
675,953
348,739
121,514
470,253
These amounts represent liabilities for goods and services provided to the Group prior to the end of the
financial year that remain unpaid. The amounts are unsecured and are usually paid according to supplier term.
Financial Risk Management
Information concerning the Group’s exposure to financial risks on trade and other payables is set out in Note 19.
Note 14. Borrowings
Current (secured)
Hire purchase loan (refer (a) below)
Current (unsecured)
Insurance premium funding (refer (b) below)
Total current borrowings
Non-current (secured)
Hire purchase loan (refer (a) below)
Total non-current borrowings
31 July 2021
31 July 2020
$
$
10,376
10,376
-
10,376
53,457
53,457
64,985
75,361
63,869
63,869
(a) Hire purchase loan is a secured loan at a lending rate of 4.23% p.a. for the purchase of a heavy-duty field
vehicle used by the Company’s Drilling Supervisor. It expires during December 2022. The hire purchase loan is
secured over the vehicle.
(b) Insurance premium funding was an unsecured fixed interest rate debt at 4.10% p.a. with Hunter Premium
Funding, with a repayment period not exceeding one year. The facility expired during the financial year.
The Group also has access to a $500,000 secured bank guarantee facility provided by the National Australia
Bank Limited, of which $100,000 is currently being utilised to secure a bank guarantee for a rehabilitation bond.
The facility expires January 2022. Refer Note 23(a) for further details.
The Group also has access to a $500,000 secured overdraft facility with the National Australia Bank Limited at a
business lending rate of 3.0% p.a. plus a customer margin of 2.2% if drawn down. As at the end of the financial
year the Group has no balance owing on this facility and the full amount is available for use. The facility expires
January 2022.
The bank guarantee and overdraft facilities with the National Australia Bank Limited are secured by a
$1,000,000 mortgage over the Kalkaroo Station pastoral lease (refer Note 11).
Financial Risk Management
Information concerning the Group’s exposure to financial risks on borrowings is set out in Note 19.
Page 44
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 15. Provisions
Current
Employee benefits
Total current provisions
31 July 2021
31 July 2020
$
$
571,219
571,219
519,308
519,308
Significant Accounting Policy: Employee Benefits
A liability is recognised for benefits accruing to employees in respect of wages and salaries, annual leave,
long service leave, and sick leave when it is probable that settlement will be required and they are capable of
being measured reliably. Liabilities recognised in respect of short-term employee benefits are measured at their
nominal values using the remuneration rate expected to apply at the time of settlement.
Liabilities recognised in respect of long-term employee benefits are measured as the present value of the
estimated future cash outflows.
Note 16. Other Financial Liabilities
Current (unsecured)
31 July 2021
31 July 2020
$
$
Research & Development income amendment (refer (a) below)
Total current other financial liabilities
158,706
158,706
542,340
542,340
(a) Industry Science Australia carried out a review of the Group’s Research & Development projects registered
for the income tax years ended 31 July 2013 and 31 July 2014. Certain registered activities for both income tax
years were found not to have met the requirements of the Income Tax Assessment Act 1997. During the
financial year ended 31 July 2019, the Group entered into a payment plan with the Australian Taxation Office
(‘ATO’) in respect of the amount outstanding due to amended income tax returns for 2013 and 2014 for
Research & Development claims disallowed. The amount included interest and penalties imposed. During the
financial year Havilah appealed the ruling and obtained a settlement with the ATO (refer Note 4).
Financial Risk Management
Information concerning the Group’s exposure to financial risks on other financial liabilities is set out in Note 19.
Note 17. Deferred Grants
Non-current
Government grants obtained during financial year
Total non-current deferred grants
* Refer to Note 1 for details of the restatement.
31 July 2021
$
111,500
111,500
Restated*
31 July 2020
$
-
-
Significant Accounting Policy: Government Grants
Government grants are assistance by government in the form of transfers of resources to the Group in return for
past or future compliance with certain conditions relating to the operating activities of the Group.
Government grants are not recognised until there is reasonable assurance that the Group will comply with the
conditions attached to them and the grant will be received.
The Group’s projects at times may be supported by grants received from federal, state and/or local
governments. Government grants received in relation to exploration and evaluation expenditure are initially
deferred as a liability until the grant is spent. Once spent, it is then recognised as a reduction in the carrying
value of the exploration and evaluation asset or income if the expenditure relating to the grant is expensed.
Page 45
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 18. Contributed Equity and Reserves
(a) Contributed Equity
Ordinary shares, fully paid
Total contributed equity
(b) Movement in Ordinary Shares
Dates
Details
31 July 2021
31 July 2020
$
$
82,829,843
82,829,843
76,906,563
76,906,563
Number of
ordinary
shares
$
1 August 2019
Opening balance in prior financial year
218,249,052
71,674,794
10 October 2019
Ordinary shares issued – listed options exercised
14,286
5,714
18 November 2019 Ordinary shares issued – entitlement offer
31,353,622
3,135,362
22 November 2019 Ordinary shares issued – shortfall shares
4 December 2019 Ordinary shares issued – shortfall shares
4 December 2019 Ordinary shares issued – listed options exercised
30 January 2020
Ordinary shares issued – shortfall shares
12 March 2020
Ordinary shares issued – share placement
25 May 2020
Ordinary shares issued – share placement
5,000,000
350,000
100
878,620
10,100,000
5,000,000
Transaction costs arising on ordinary shares issued
-
500,000
35,000
40
87,862
1,010,000
500,000
(42,209)
31 July 2020
Balance at end of prior financial year
270,945,680
76,906,563
23 November 2020 Ordinary shares issued – share placement
15 December 2020 Ordinary shares issued – share purchase plan
15 December 2020 Ordinary shares issued – share placement
15,000,000
15,990,374
4,341,174
Transaction costs arising on ordinary shares issued
-
2,550,000
2,718,400
738,000
(83,120)
31 July 2021
Balance at end of financial year
306,277,228
82,829,843
The Company does not have a limited amount of authorised capital and ordinary shares have no par value.
(c) Dividends
Ordinary shares participate in dividends as declared and the proceeds on winding up of the Company in
proportion to the number of fully paid ordinary shares held.
There were no ordinary dividends declared or paid during the financial year by the Company (2020: $Nil).
(d) Capital Management
The Group manages its capital to ensure that the Group will be able to continue as a going concern while
maximising the return to shareholders through the optimisation of the debt and equity balance.
The capital structure of the Group consists of debt, which includes borrowings disclosed in Note 14, cash and
cash equivalents, and equity attributable to equity holders of the Company comprising contributed equity,
accumulated losses and reserves.
Due to the nature of the Group’s activities, that is exploration and evaluation, the Board of Directors believes
that due to the different stages of its projects, and their differing capital requirements and risks, it is not possible
to define what funding method is optimal from the range of options available to the Group, namely: equity, debt,
joint venture or sell down of project equity or some combination. At all times, the Group’s proposed activities are
monitored to ensure optimal funding arrangements are put in place that are appropriate to the particular
circumstance of each project or activity being undertaken.
Page 46
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 18. Contributed Equity and Reserves (continued)
(e) Significant Accounting Policies:
Contributed Equity
Ordinary shares are classified as equity. Contributed equity represents the fair value of ordinary shares that
have been issued. Any transaction costs directly attributable to the issue of new ordinary shares are deducted
from issued share capital, net of any related income tax.
Reserves Within Equity
Share-based payments reserve: is used to recognise the grant date fair value of share-based payments
expense. Amounts are transferred out of this reserve and into accumulated losses when share options lapse.
Buy-out reserve: resulted from the purchase of Curnamona Energy Pty Limited and Geothermal Resources Pty
Limited’s non-controlling interests by Havilah Resources Limited. It represented the difference between the
consideration paid and the carrying value of the non-controlling interest.
Note 19. Financial Instruments (including Financial Risk Management)
The Group’s activities expose it to a variety of financial risks: market risk; credit risk; and liquidity risk.
The Group’s financial risk management program focuses on the unpredictability of financial markets and seeks
to minimise potential adverse effects on the financial performance of the Group. The Group uses different
methods to measure the different types of financial risk to which it is exposed. These methods include sensitivity
analysis in the case of interest rates and equity price.
The overall financial risk management strategy of the Group is governed by the Board of Directors, and is
primarily focused on ensuring the Group is able to finance its business plans, whilst minimising potential adverse
effects on financial performance. Risk management policies and systems are reviewed on a periodic basis to
reflect changes in market conditions and Group activities.
The totals for each category of financial instruments in the consolidated statement of financial position are:
Financial assets
Cash and cash equivalents
Trade and other receivables
Bank term deposits
Shares in a listed ASX entity (designated FVTPL)
Financial liabilities
Trade and other payables
Borrowings
Other financial liabilities
Note
31 July 2021
31 July 2020
$
$
7(a)
4,007,410
1,483,724
8
12
12
13
14
16
62,996
60,000
540,834
675,953
63,833
158,706
102,358
60,000
860,417
470,253
139,230
542,340
The Group had no off-balance sheet financial assets or financial liabilities during the financial year or prior
financial year.
(a) Market Risk
(i) Commodity Price Risk
The Group does not currently have any projects in production and has no current exposure to commodity price
fluctuations.
Page 47
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 19. Financial Instruments (including Financial Risk Management) (continued)
(a) Market Risk (continued)
(ii) Interest Rate Risk
Interest rate risk is the risk that the fair value of future cash flows of financial assets and financial liabilities will
fluctuate because of changes in market interest rates.
The Group is exposed to interest rate risk as it earns interest at floating rates from a portion of its cash and cash
equivalents. When relevant, the Group places a portion of its funds into short-term fixed interest bank deposits
that provide short-term certainty over the interest rate earned.
The Group had no interest rate hedging in place as at 31 July 2021 (or 31 July 2020).
The Group’s exposures to interest rates on financial assets and financial liabilities are detailed in the liquidity
risk management section of this note.
Interest rate sensitivity analysis
This sensitivity should not be used to forecast the future effect of movements in interest rates on future cash
flows.
If interest rates had been 50 basis points higher or lower at the end of the reporting period, and all other
variables were held constant, the Group’s loss would decrease $20,337 and increase by $90 respectively
(2020: $13,259 both decrease and increase). This is attributable to interest rates on bank term deposits and
trading accounts.
(iii) Equity Price Risk
The Group is exposed to equity price risks arising from its equity investment in fully paid ordinary shares held in
ASX listed Auteco Minerals Ltd. Equity investments are held for strategic rather than trading purposes.
Equity price sensitivity analysis
The sensitivity analysis below has been determined based on the exposure to equity price risks at the end of the
reporting period. This sensitivity should not be used to forecast the future effect of movements in equity price on
future profit or loss.
At the end of the reporting period, if Auteco Minerals Ltd’s last traded price on the ASX had been 5% higher or
lower the Group’s loss would decrease/increase by $27,042 (2020: $43,020).
(b) Credit Risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss
to the Group. The Group has adopted a policy of only dealing with creditworthy counterparties and obtaining
sufficient collateral where appropriate, as a means of mitigating the risk of financial loss from activities.
The Group has a significant credit risk exposure to Consolidated Mining & Civil Pty Ltd (‘CMC’), with a gross
receivable balance of $3,800,000 (31 July 2020: $3,800,000). The Group’s exposure is secured by a registered
charge over Mining Lease ML6346 and the assets of Benagerie Gold & Copper Pty Ltd. The credit rating of
CMC is monitored on a periodic basis for credit deterioration. During the financial year ended 31 July 2020, the
Group had fully written-down the carrying value of this asset. The Group does not have any significant credit risk
exposure to any other counterparty, other than bank term deposits and trading accounts with the Group’s bank.
The credit risk on liquid funds is limited because the counterparty is an Australian bank with an investment
grade credit rating assigned by international credit rating agencies.
Where commercially practical, the Group seeks to limit the amount of credit exposure to any one bank or
financial institution. The Group is exposed to concentration of credit risk in relation to bank term deposits and
trading accounts held with the National Australia Bank Limited, the maximum exposure as at 31 July 2021 was
$4,067,407 (31 July 2020: $1,543,724).
The carrying amount of financial assets recorded in the consolidated financial statements and relevant notes,
net of any allowances for losses and/or impairments, represents the Group’s maximum exposure to credit risk
without taking account of the value of any collateral obtained.
Page 48
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 19. Financial Instruments (including Financial Risk Management) (continued)
(c) Liquidity Risk
Liquidity risk is the risk that the Group will encounter difficulty in meeting obligations associated with financial
liabilities. Ultimate responsibility for liquidity risk management rests with the Board of Directors, which has built
an appropriate liquidity risk management framework for the management of the Group’s short, medium and
long-term funding and liquidity management requirements. The Group manages liquidity risk by ensuring there
are sufficient funds available to meet financial obligations on a day-to-day basis and to meet unexpected
liquidity needs in the normal course of business. Emphasis is placed on ensuring there is sufficient funding in
place to meet the ongoing requirements of the Group’s exploration and evaluation activities.
Liquidity and interest risk tables
The following tables detail the Group’s remaining contractual maturity and interest rate risk for its financial
assets and financial liabilities at the end of the financial year.
Financial assets
2021
Non-interest bearing
Variable interest rate
2020
Non-interest bearing
Variable interest rate
Financial liabilities
2021
Non-interest bearing
Variable interest rate
Fixed interest rate
2020
Non-interest bearing
Variable interest rate
Fixed interest rate
Weighted average
effective interest rate
Less than 1 year
1 to 2 years
%
-
0.0
-
0.75
$
603,830
4,067,410
962,775
1,543,724
$
-
-
-
-
Weighted average
effective interest rate
Less than 1 year
1 to 2 years
%
-
7.9
4.1
-
7.9
4.1
$
675,953
158,706
10,376
470,253
542,340
75,361
$
-
-
53,457
-
-
63,869
(d) Fair Value Measurement of Assets and Liabilities
The fair value of financial assets and financial liabilities are not materially different to their carrying amount.
As the shares in a listed ASX entity (designated FVTPL) are publicly traded listed securities (and traded actively
on the ASX) the fair value as at 31 July 2021 of $540,834 (31 July 2020: $860,417) was based on the shares
last quoted sales price at the end of the reporting period.
The Group did not measure any financial assets or financial liabilities on a non-recurring basis as at
31 July 2021 (or 31 July 2020).
There have been no transfers between levels of the fair value hierarchy used in measuring the fair value of
financial instruments. There have also been no changes in the classification of financial assets as a result of a
change in the purpose or use of those assets.
Page 49
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 19. Financial Instruments (including Financial Risk Management) (continued)
Significant Accounting Policy: Financial Instruments
The classification depends on the nature and purpose of the financial asset or financial liability and is
determined at the time of initial recognition.
All income and expenses relating to financial assets that are recognised in profit or loss are presented within
finance costs, interest income or other financial items, except for impairment of trade receivables which is
presented within other expenses.
Cash and cash equivalents
Cash and cash equivalents in the consolidated statement of financial position and for presentation in the
consolidated statement of cash flows comprise cash on hand, cash at banks and short-term bank deposits that
are readily convertible to known amounts of cash and which are subject to insignificant risk of changes in value.
Trade and other receivables
Receivables, which normally have 30-day terms, are generally non-interest bearing amounts. They are
recognised initially at the amount of the consideration that is unconditional unless they contain significant
financing components, when they are recognised initially at fair value. The Group holds receivables with the
objective to collect the contractual cash flows. They are presented as current assets, unless collection is not
expected for more than 12 months after the end of the reporting period. For receivables expected to be settled
within 12 months, these are subsequently measured at amortised cost using the effective interest method, less
any loss allowance.
For receivables expected to be settled later than 12 months, these are subsequently measured at amortised
cost based on discounted cash flows using an effective interest rate, less any loss allowance. Cash flows
relating to non-current receivables are not discounted if the effect of discounting would be immaterial.
FVTPL (Financial assets at fair value through profit or loss)
Certain shares in a listed ASX entity held by the Group are classified as being available-for-sale and are stated
at fair value less impairment. Gains and losses arising from changes in fair value are recognised directly in profit
or loss for the reporting period. Fair value has been determined based on quoted market prices.
Impairment of financial assets
The Group has applied the AASB 9 ‘Financial Instruments’ general model approach to measuring expected
credit losses for all financial assets.
While cash and cash equivalents are also subject to the impairment requirements of AASB 9 ‘Financial
Instruments’, the identified impairment loss was considered not significant given the counterparty and/or the
short maturity.
When required, the carrying amount of the relevant financial asset is reduced through the use of a loss
allowance account and the amount of any loss is recognised in profit or loss. When measuring expected credit
losses, balances are reviewed based on available external credit ratings, historical loss rates and/or the days
past due.
Classification and measurement of financial liabilities
The Group’s financial liabilities include trade and other payables, borrowings, and other financial liabilities.
Financial liabilities are initially measured at fair value and, where applicable, adjusted for transaction costs
unless the Group designated a financial liability as FVTPL. They are presented as current liabilities, unless
payment is not due for more than 12 months after the end of the reporting period.
Subsequently, financial liabilities are measured at amortised cost using the effective interest method except for
financial liabilities designated as FVTPL, which are carried subsequently at fair value with gains or losses
recognised in profit or loss.
All interest-related charges and, if applicable, changes in an instrument’s fair value that are reported in profit or
loss are included within finance costs.
Page 50
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 20. Composition of the Group
Havilah Resources Limited, the Group’s ultimate Parent Company, is an Australian public company limited by
shares and is listed on the ASX. The Company was incorporated as a public company on 11 February 1997.
The Company is domiciled in Australia. Its registered office and principal place of business is 107 Rundle Street,
Kent Town, South Australia 5067.
Country of
incorporation
& activities
carried on in Principal activity
Ownership and
voting interest
held by the Group
2021
2020
Name
Parent Company:
Havilah Resources Limited
Australia
Subsidiaries:
Copper Aura Pty Ltd
Australia
Iron Genesis Pty Ltd
Australia
Havilah Royalties Pty Ltd
Australia
Curnamona Energy Pty Limited
Australia
Parent Company. Owner of various
exploration licences and Mutooroo Mining
Lease
Owner of various tenements in the
Mutooroo Project Area
Owner of various tenements related to
the Group’s iron ore assets
Owner of Benagerie mining lease royalty
for the Portia Gold Mine
Owner of Oban Energy Pty Limited and
various uranium exploration licences
Geothermal Resources Pty
Limited
Australia
Owner of Neo Oil Pty Ltd and a
geothermal exploration licence
Kalkaroo Copper Pty Ltd
Australia
Kalkaroo Pastoral Company Pty
Limited
Lilydale Iron Pty Ltd
Maldorky Iron Pty Ltd
Australia
Australia
Australia
Mutooroo Metals Pty Ltd
Australia
Owner of the Kalkaroo project (3 Mining
Leases, 2 Miscellaneous Purposes
Licences and 1 Mineral Claim granted)
Owner of the Kalkaroo Station pastoral
lease
No current tenements
Owner of the Maldorky iron ore project (5
Mineral Claims granted and Mining Lease
application in process)
Owner of the Mutooroo copper-cobalt
project (2 Mineral Claims granted)
Neo Oil Pty Ltd
Oban Energy Pty Limited
Australia
Australia
No current tenements
No current tenements
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
Havilah Resources Limited is the head entity of the tax-consolidated group and all the subsidiaries listed above
are members of the tax-consolidated group.
Significant Accounting Policy: Basis of Consolidation
The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of the Company as
at 31 July 2021 and the results of all subsidiaries for the financial year then ended.
Subsidiaries are all entities over which the Group has control. The Group controls an entity when the Group 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 to direct the activities of the entity. Subsidiaries are fully consolidated from the
date on which control is transferred to the Group. They are deconsolidated from the date that control ceases.
Accounting policies of subsidiaries have been changed, where necessary, to ensure consistency with the
accounting policies applied by the Group.
Intercompany transactions, balances and unrealised gains on transactions between Group companies are
eliminated on consolidation. Unrealised losses are also eliminated, unless the transaction provides evidence of
the impairment of the asset transferred.
Page 51
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 21. Joint Arrangements
The Group undertakes a number of business activities through joint arrangements, which exist when two or
more parties have joint control. Joint arrangements are classified as either joint operations or joint ventures,
based on the contractual rights and obligations between the parties to the arrangement.
(a) Joint Venture Arrangements
The Group had no joint venture arrangements as at 31 July 2021 (or 31 July 2020).
(b) Joint Operation Arrangements
The Group’s interests in joint operation arrangements are as follows:
Prospect Hill farm-in agreement
Pernatty Lagoon farm-in agreement
31 July 2021
31 July 2020
Earning up to 85%
Earning up to 85%
10%, carried interest
10%, carried interest
There are no amounts (2020: $Nil) represented in the Group’s share of assets, liabilities, revenues or expenses
in respect of joint operations.
There are $Nil (31 July 2020: $Nil) exploration expenditure commitments in respect of joint operations.
Contingent liabilities in respect of joint operations are set out in Note 23(a).
Prospect Hill farm-in agreement
On 26 March 2007 the Group entered into a farm-in agreement with Teale & Associates Pty Ltd and Mr Adrian
Mark Brewer relating to exploration on EL5891 that allows the Group to earn a participating interest in the
tenement.
The Group undertook to fund an exploration program on the tenement over a 3 year period from 26 March 2007
to earn a 65% interest in the tenement, and this has been met.
The Group is able to earn an additional 20% interest in the tenement by completing a bankable feasibility study,
which has not been met. Thereafter Teale & Associates Pty Ltd and Mr Adrian Mark Brewer may contribute their
15% share of development costs or revert to a net smelter return royalty.
Pernatty Lagoon farm-in agreement
On 15 October 2004 the Group entered into a farm-in agreement with Red Metal Limited relating to exploration
on EL6014. Under the above farm-in agreement, the Group’s interest was converted into a 10% carried interest.
Significant Accounting Policy: Joint Arrangements
A joint operation is an arrangement in which the Group shares joint control, primarily via contractual
arrangements with other parties. In a joint operation, the Group has rights to the assets and obligations for the
liabilities relating to the arrangement. This includes situations where the parties benefit from the joint activity
through a share of the output, rather than by receiving a share of the results of trading. In relation to the Group’s
interest in a joint operation, the Group recognises: its share of assets and liabilities; revenue from the sale of its
share of the output and its share of any revenue generated from the sale of the output by the joint operation;
and its share of expenses. All such amounts are measured in accordance with the terms of the arrangement,
which is usually in proportion to the Group’s interest in the joint operation.
Page 52
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 22. Commitments
(a) Exploration Expenditure Commitments
The Group has certain obligations to perform exploration work and expend minimum amounts of money, known
as exploration expenditure commitments, on South Australian exploration tenements it holds. The exploration
expenditure commitments of the Group will vary from time to time, subject to statutory approval. The terms of
current and future farm-out arrangements (which are typical of the normal operating activities of the Group),
the grant or
renewal or expiry,
Amalgamated Expenditure Agreements (‘AEA’) negotiated with the Department for Energy and Mining (‘DEM’)
the regulator in South Australia, will also alter the expenditure commitments of the Group.
licences, and changes
licence areas at
relinquishment of
to
Presently two AEAs are in force with the DEM that commenced effective from 1 January 2020 for the 2 year
period ending 31 December 2021, for a total expenditure commitment of $10,085,000 across relevant mineral
exploration tenements. In addition, the AEAs include relinquishment of a minimum of 10% of the combined
relevant tenement areas at the end of the 2 years if the expenditure commitments are met. During April 2020,
the South Australian government announced a 12 month waiver of committed exploration expenditure for all
mineral exploration licence holders, which has been reflected in the current AEA terms. It is expected new AEAs
will be negotiated with the DEM during early 2022, taking into account such factors as past performance,
the prevailing exploration licence (‘EL’) cumulative expenditure commitments (dependent in part on the
tenement area relinquished at the end of 2021), proposed exploration work programs, and ground accessibility.
At this stage, it is considered unlikely that AEA conditions would be more favourable in terms of overall
expenditure and relinquishment requirements than those for the current AEAs.
The minimum expenditure commitment on other mineral exploration tenements not covered by AEAs is
approximately:
Not later than 1 year
Total exploration expenditure commitments
31 July 2021
31 July 2020
$
190,000
190,000
$
190,000
190,000
(b) Kalkaroo Mining Lease and Miscellaneous Purposes Licence Rental Commitments
Non-cancellable Kalkaroo Mining Lease ('ML') and Miscellaneous Purposes Licence ('MPL') rentals not provided
for in the consolidated financial statements and payable:
Not later than 1 year
Later than 1 year but not later than 5 years
Later than 5 years
Total MLs and MPLs rental commitments
31 July 2021
31 July 2020
$
131,539
526,156
1,710,014
2,367,709
$
131,539
526,156
1,841,554
2,499,249
(c) Kalkaroo Station Pastoral Lease Rental Commitment
Non-cancellable annual Kalkaroo Station pastoral lease rentals for future financial years have not been provided
for in the consolidated financial statements. The Kalkaroo Station pastoral lease rental payment is $5,157
(2020: $5,157) per annum, and will be payable annually for an indefinite period of time.
(d) Capital Expenditure Commitments
The Group has no contractual capital expenditure commitments outstanding at 31 July 2021 (31 July 2020: $Nil).
Page 53
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 23. Contingent Liabilities and Contingent Assets
By their nature, contingencies will only be resolved when one or more uncertain future events occur or fail to
occur. Determination of contingent liabilities disclosed requires the exercise of significant judgement regarding
the outcome of future events.
(a) Contingent Liabilities
Future production
The Group has a contingent liability to Glencore International AG in relation to payments based on 10% of the
Group’s share of any future mining profits from the Kalkaroo project, until the total amount paid reaches
$7,000,000. There is no indexation.
Production royalties
The Group has a liability for royalties contingent on projects advancing into production, see notes to
Tenement Schedule on page 66 for relevant royalty arrangements.
In addition, South Australian Mining Leases held by the Group are subject to the payment of production royalties
to the South Australian government, the rate of such royalties varies depending upon the minerals produced
and sold and other factors.
Native title
During December 2018, a NTMA (Native Title Mining Agreement) for Kalkaroo was executed between the
Ngadjuri Adnyamathanha Wilyakali Native Title Aboriginal Corporation (‘NAWNTAC’) and Havilah. Annual floor
payments, adjusted for CPI (consumer price index), are due to NAWNTAC from when the Kalkaroo project
reaches commercial production. In addition, annual profits payment based on a percentage of EBITDA
(earnings before interest, tax, depreciation and amortisation), if EBITDA is positive, are due to NAWNTAC from
when the Kalkaroo project reaches commercial production, but are capped until the cumulative EBITDA
exceeds the cumulative capital costs of the project. The NTMA also includes employment, training, and
business development opportunities for the native title holders over the life of the mine.
Native title claims also exist over all exploration tenements in South Australia in which the Group has interests.
The Group is unable to determine the prospects for success or otherwise of the native title claims on these
exploration tenements and, in any event, whether or not and to what extent the native title claims may
significantly affect the Group or its projects, as such any contingent liability is unknown.
Bank guarantees
The Group has provided restricted cash deposits of $60,000 as security for a number of unconditional
irrevocable bank guarantees for the provision of various rehabilitation bonds to the Minister for Energy and
Mining and security for a purchase card facility provided to the Group by its banker.
Additionally, the Group has utilised $100,000 of a non-cash backed National Australia Bank Limited guarantee
facility of $500,000 as security for the following unconditional irrevocable bank guarantee: a rehabilitation bond
issued by Geothermal Resources Pty Limited for $100,000 to the Minister for Energy and Mining.
Joint operations
In accordance with normal industry practice, the Group has entered into joint operations with other parties for
the purpose of exploring and evaluating its exploration tenements. If a participant to a joint operation defaults
and does not contribute its share of joint operation obligations, then the remaining joint operation participants
are jointly and severally liable to meet the obligations of the defaulting participant. In this event, the interest in
the exploration tenements held by the defaulting participant may be redistributed to the remaining joint operation
participants.
In the event of a default, a contingent liability exists in respect of expenditure commitments due to be met by the
Group in respect of the defaulting joint operation participant.
(b) Contingent Assets
Pursuant to an agreement with CMC, the Group has a contingent payment of $3,800,000 due to it on the
development of the North Portia mine and that mine achieving production revenue of $3,500,000. There is no
indexation.
Page 54
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 24. Related Party Disclosures
Transactions between related parties are on normal commercial terms and conditions, no more favourable than
those available to other parties, unless otherwise stated.
(a) Subsidiaries
The ultimate Parent Company within the Group is Havilah Resources Limited. Details of the percentage
ownership of ordinary shares in subsidiaries are disclosed in Note 20.
(b) Remuneration of Key Management Personnel
Directors and other key management personnel remuneration is summarised as follows:
Short-term employee benefits
Post-employment benefits
Long-term employee benefits
Share-based payments expense
Financial Year Ended
31 July 2021
31 July 2020
$
571,822
49,990
6,182
87,991
$
855,546
73,458
6,500
106,394
Total key management personnel remuneration
715,985
1,041,898
Detailed
Remuneration Report on page 22.
remuneration disclosures
for key management personnel are provided
in
the audited
Apart from the details disclosed in this note, no Director or other key management personnel has entered into a
material contract with the Group since the end of the prior financial year and there were no material contracts
involving Directors’ or other key management personnel interests subsisting as at 31 July 2021.
(c) Other Related Party Transactions with Directors and Related Entities
During the financial year the Group incurred the following other amounts as a result of transactions with
Directors and other key management personnel, including their personally related parties (excluding amounts
paid as remuneration to Directors and other key management personnel):
•
•
•
$23,732 (2020: $37,600) for marketing and public relations services to a social media company (Filtrd) in
which a related party (William Giles) of Dr Christopher Giles has an interest. The balance outstanding
included in trade and other payables is $2,000 (2020: $11,000);
$Nil (2020: $2,565) for legal services provided by a company (Arion Legal) that is a related party of
Mr Mark Stewart (who ceased to be a Havilah Director on 9 October 2019). The balance outstanding
included in trade and other payables is $Nil (2020: $Nil); and
$Nil (2020: $2,400) for marketing and public relations support to a related party (William Giles) of
Dr Christopher Giles. The balance outstanding included in trade and other payables is $Nil (2020: $Nil).
(d) Superannuation Contributions
During the financial year the Group contributed to accumulation type benefit funds administered by external fund
managers or an employee’s self-managed superannuation fund. The funds cover employees and Directors of
the Group.
Page 55
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 25. Share-based Payments
The Plan (Performance Rights and Share Option Plan), approved by the Board of Directors during March 2019,
is open to all employees but excludes Directors of the Company. In accordance with the provisions of the Plan,
the Board of Directors may issue share options to purchase ordinary shares to eligible executives and
employees. Each share option is to subscribe for one fully paid ordinary share in the Company. Share options
can be exercised in the year of vesting, and share options not exercised during a particular year will accumulate
and may be exercised in subsequent years until their expiry.
Other relevant details are:
•
•
•
•
•
no consideration is payable by the recipient on receipt of share options issued;
the share options will only be issued following acceptance of a written application by the employee in
response to an invitation to participate in the Plan being issued by the Board of Directors;
the share options have various time and/or performance related vesting conditions;
the share options expire at the earlier of either 3 or 4 years from the issue date or 1 month from the date the
share option holder ceases to be an employee of the Company; and
share options granted carry no dividend or voting rights.
The following summary reconciles the outstanding share options over unissued ordinary shares in the Company
at the beginning and end of the financial year:
Year ended 31 July 2021
Year ended 31 July 2020
Balance at beginning of financial year
Issued during financial year
Exercised during financial year
Expired during financial year
Forfeited during financial year
Balance at end of financial year
Exercisable at end of financial year
Number of
share
options
17,319,258
4,400,000
-
(600,000)
(862,384)
20,256,874
19,542,707
Weighted
average
exercise
price
$
0.26
0.25
-
0.40
0.25
0.26
0.26
Number of
share
options
17,319,258
Weighted
average
exercise
price
$
0.26
-
-
-
-
17,319,258
17,026,407
-
-
-
-
0.26
0.25
Details of share options outstanding at the end of the financial year are:
Grant date
1 November 2018 (Investec 1)
12 December 2018 (Director 2)
20 December 2018 (Investec 1)
11 July 2019 (Employee 3)
11 July 2019 (Employee 3)
3 May 2021 (Employee 3)
3 May 2021 (Employee 3)
3 May 2021 (Employee 3)
Number
5,000,000
2,400,000
2,500,000
2,950,646
3,006,228
3,733,333
333,334
333,333
Grant date
fair value
Exercise price per
share option
Expiry date
$0.06
$0.03
$0.07
$0.05
$0.05
$0.11
$0.09
$0.06
$0.234
1 November 2021
$0.36 12 December 2021
$0.22 20 December 2021
$0.22
$0.28
$0.25
$0.25
$0.25
11 July 2023
11 July 2023
30 April 2024
30 April 2024
30 April 2024
Total
1 Unlisted share options issued to Investec under a prior financial period funding agreement.
2 Unlisted share options issued to a Director (Dr Christopher Giles).
3 Unlisted share options issued to employees under the Company’s Performance Rights and Share Option Plan.
20,256,874
The share options previously issued to Investec and a Director were issued pursuant to resolutions approved by
shareholders at the 2018 Annual General Meeting.
Page 56
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 25. Share-based Payments (continued)
Share options outstanding at the end of the financial year had a weighted average exercise price of $0.26
(31 July 2020: $0.26), a range of exercise prices from $0.22 to $0.36 (31 July 2020: $0.22 to $0.40), with a
weighted average remaining contractual life of 492 days (31 July 2020: 735 days).
The number of share options granted to employees is set by the Board of Directors at its discretion but
consideration is given to employment contract terms. During the financial year 4,400,000 share options were
granted to employees under the Plan. Share options do not represent cash payments and share options granted
may or may not be exercised by the holder.
Share-based payments expense is summarised as follows:
Director share options
Employee share options
Investec
Total share-based payments expense
Financial Year Ended
31 July 2020
31 July 2021
$
-
(381,135)
-
(381,135)
$
(36,804)
(167,058)
(117,939)
(321,801)
Significant Accounting Policy: Share-based Payments
Equity-settled share-based payments expense relates to the value of share options allocated to particular
financial periods in accordance with AASB 2 ‘Share-based Payment’, which requires the fair value of a share
option at grant date to be allocated equally over the period from grant date to vesting date based on the Group’s
estimate of ordinary shares that will eventually vest, adjusted for not meeting the vesting condition. For share
options that vest immediately, the value is disclosed as an expense immediately.
Fair value is measured by use of the binomial option pricing method. Share options do not represent
cash payments and share options granted may or may not be exercised by the holder.
Significant Accounting Estimates, Assumptions and Judgements: Share-based Payments
The share options issued by Havilah during the financial year were priced using a binomial option pricing model,
the assumptions and inputs used in estimating fair value at grant date of the unlisted share options were:
Issue date
3 May 2021
Share price
at grant date
$0.21
Exercise
price
$0.25
Expected
volatility
85.54%
Share option
life
3 years
Expected
dividends
-
Risk-free
interest rate
1.64%
The fair value determined at the issue date of the equity-settled share-based payments is expensed on a
straight-line basis over the vesting period, based on the Group’s estimate of ordinary shares that will eventually
vest.
Historical volatility was the basis for determining expected share price volatility as it is assumed that this is
indicative of future trends, which may not eventuate.
Note 26. Adoption of New or Revised Australian Accounting Standards and Interpretations that are First
Effective in the Current Reporting Period
The Group has adopted all the new and/or revised Australian Accounting Standards and Interpretations issued
by the AASB that are relevant to its operations and effective for the financial year. The Group has not elected to
apply any new or revised Australian Accounting Standards before their operative dates during the financial year.
A number of other Australian Accounting Standards and Interpretations have been issued and will be applicable
in future periods. While these remain subject to ongoing assessment, no significant impacts have been identified
to date. These standards have not been applied in the preparation of consolidated financial statements.
The adoption of all of the relevant new and/or revised Australian Accounting Standards and Interpretations has
not resulted in any changes to the Group’s significant accounting policies and has had no effect on either the
amounts reported for the current or prior financial years.
Page 57
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 27. Parent Company Financial Information
Statement of Financial Position
Current assets
Non-current assets
Total assets
Current liabilities
Non-current liabilities
Total liabilities
Net assets
Contributed equity
Share-based payments reserve
Accumulated losses
Total equity
Loss for financial year
Other comprehensive income
Total comprehensive loss
Parent Company
31 July 2021
31 July 2020
$
$
4,220,786
33,282,335
37,503,121
1,924,003
53,456
1,734,923
31,651,724
33,386,647
1,995,574
63,869
1,977,459
2,059,443
35,525,662
82,829,843
1,252,741
31,327,204
76,906,563
945,862
(48,556,922)
(46,525,221)
35,525,662
31,327,204
(2,105,957)
(11,920,011)
-
-
(2,105,957)
(11,920,011)
Commitments for Expenditure and Contingent Liabilities of Parent Company
(a) Exploration Expenditure Commitments
The exploration expenditure commitments are similar to that of the Group as disclosed in Note 22(a).
(b) Guarantees
The circumstances around guarantees for the Parent Company are similar to that of the Group as disclosed in
Note 23(a).
(c) Native Title
The circumstances around native title for the Parent Company are similar to that of the Group as disclosed in
Note 23(a).
Note 28. Significant Matters Arising Subsequent to the End of the Financial Year
The Annual Report was authorised for issue by the Board of Directors on 25 October 2021. The Board of
Directors has the power to amend and reissue this Annual Report.
There has been no other matter or circumstance that has arisen since the end of the financial year, that has
significantly affected or may significantly affect the operations of the Group, the results of those operations, or
the state of affairs of the Group in future financial years.
Page 58
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
DIRECTORS’ DECLARATION
The Directors’ declare that:
(a) in the Directors’ opinion, the consolidated financial statements and notes, set out on pages 29 to 58, are in
accordance with the Corporations Act 2001, including:
(i)
complying with relevant Australian Accounting Standards and the Corporations Regulations 2001;
and
(ii) giving a true and fair view of the Group’s financial position as at 31 July 2021 and of its performance
for the financial year ended on that date; and
(b) in the Directors’ opinion, there are reasonable grounds to believe that the Company will be able to pay its
debts as and when they become due and payable.
Note 1 confirms that the consolidated financial statements also comply with International Financial Reporting
Standards as issued by the International Accounting Standards Board.
The Directors have been given the declarations by the Technical Director and Chief Financial Officer required
by Section 295A of the Corporations Act 2001.
This Directors’ Declaration is made in accordance with a resolution of the Board of Directors.
On behalf of the Board of Directors:
Dr Christopher Giles
Executive Director
25 October 2021
Mr Simon Gray
Executive Chairman
Page 59
Level 3, 170 Frome Street
Adelaide SA 5000
Correspondence to:
GPO Box 1270
Adelaide SA 5001
T +61 8 8372 6666
Independent Auditor’s Report
To the Members of Havilah Resources Limited
Report on the audit of the financial report
Opinion
We have audited the financial report of Havilah Resources Limited (the Company) and its subsidiaries (the Group), which
comprises the consolidated statement of financial position as at 31 July 2021, the consolidated statement of profit or loss
and other comprehensive income, consolidated statement of changes in equity and consolidated statement of cash flows
for the year then ended, and notes to the consolidated financial statements, including a summary of significant accounting
policies, and the Directors’ declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act 2001, including:
a giving a true and fair view of the Group’s financial position as at 31 July 2021 and of its performance for the year
ended on that date; and
b complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are
further described in the Auditor’s Responsibilities for the Audit of the Financial Report section of our report. We are
independent of the Group in accordance with the auditor independence requirements of the Corporations Act 2001 and
the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for
Professional Accountants (including Independence Standards) (the Code) that are relevant to our audit of the financial
report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Material uncertainty related to going concern
We draw attention to Note 2 in the financial report, which indicates that the Group incurred a net loss of $2,361,870 during the
year ended 31 July 2021, and as of that date, the Group had net operating and investing cash outflows of $3,324,197. As
stated in Note 2, these events or conditions, along with other matters as set forth in Note 2, indicate that a material uncertainty
exists that may cast doubt on the Group’s ability to continue as a going concern. Our opinion is not modified in respect of this
matter.
Grant Thornton Audit Pty Ltd ACN 130 913 594
a subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389
www.grantthornton.com.au
‘Grant Thornton’ refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory services to their clients
and/or refers to one or more member firms, as the context requires. Grant Thornton Australia Ltd is a member firm of Grant Thornton International
Ltd (GTIL). GTIL and the member firms are not a worldwide partnership. GTIL and each member firm is a separate legal entity. Services are
delivered by the member firms. GTIL does not provide services to clients. GTIL and its member firms are not agents of, and do not obligate one
another and are not liable for one another’s acts or omissions. In the Australian context only, the use of the term ‘Grant Thornton’ may refer to
Grant Thornton Australia Limited ABN 41 127 556 389 and its Australian subsidiaries and related entities. GTIL is not an Australian related entity to
Grant Thornton Australia Limited.
Liability limited by a scheme approved under Professional Standards Legislation.
Page 60
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial
report of the current period. These matters were addressed in the context of our audit of the financial report as a whole, and in
forming our opinion thereon, and we do not provide a separate opinion on these matters.
In addition to the matter described in the Material uncertainty related to going concern section, we have determined the
matters described below to be the key audit matters to be communicated in our report.
Key audit matter
How our audit addressed the key audit matter
Exploration and evaluation assets – Note 10
At 31 July 2021 the carrying value of exploration and
evaluation assets was $37,346,924.
In accordance with AASB 6 Exploration for and Evaluation of
Mineral Resources, the Group is required to assess at each
reporting date if there are any triggers for impairment which
may suggest the carrying value is in excess of the recoverable
value.
The process undertaken by management to assess whether
there are any impairment triggers in each area of interest
involves an element of management judgement.
This area is a key audit matter due to the significant
judgement involved in determining the existence of
impairment triggers.
Our procedures included, amongst others:
•
•
•
•
•
obtaining the management reconciliation of capitalised
exploration and evaluation expenditure and agreeing to the
general ledger;
reviewing management’s area of interest considerations
against AASB 6;
conducting a detailed review of management’s
assessment of trigger events prepared in accordance with
AASB 6 including;
− tracing projects to statutory registers, exploration
licenses and third party confirmations to determine
whether a right of tenure existed;
− enquiry of management regarding their intentions to
carry out exploration and evaluation activity in the
relevant exploration area, including review of
management’s budgeted expenditure;
− understanding whether any data exists to suggest that
the carrying value of these exploration and evaluation
assets are unlikely to be recovered through
development or sale;
evaluating the competence, capabilities and objectivity of
management’s experts in the evaluation of potential
impairment triggers; and
assessing the appropriateness of the related financial
statement disclosures.
Information other than the financial report and auditor’s report thereon
The Directors are responsible for the other information. The other information comprises the information included in the
Group’s annual report for the year ended 31 July 2021, but does not include the financial report and our auditor’s report
thereon.
Our opinion on the financial report does not cover the other information and we do not express any form of assurance
conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information and, in doing so, consider
whether the other information is materially inconsistent with the financial report or our knowledge obtained in the audit or
otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are
required to report that fact. We have nothing to report in this regard.
Page 61
Responsibilities of the Directors’ for the financial report
The Directors of the Company are responsible for the preparation of the financial report that gives a true and fair view in
accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the Directors
determine is necessary to enable the preparation of the financial report that gives a true and fair view and is free from material
misstatement, whether due to fraud or error.
In preparing the financial report, the Directors are responsible for assessing the Company’s/Group’s ability to continue as a
going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting
unless the Directors either intend to liquidate the Company/Group or to cease operations, or have no realistic alternative but to
do so.
Auditor’s responsibilities for the audit of the financial report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material
misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance
is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian Auditing
Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions
of users taken on the basis of this financial report.
A further description of our responsibilities for the audit of the financial report is located at the Auditing and Assurance
Standards Board website at: http://www.auasb.gov.au/auditors_responsibilities/ar1_2020.pdf. This description forms part of
our auditor’s report.
Report on the remuneration report
Opinion on the remuneration report
We have audited the Remuneration Report included in the Directors’ report for the year ended 31 July 2021.
In our opinion, the Remuneration Report of Havilah Resources Limited, for the year ended 31 July 2021 complies with
section 300A of the Corporations Act 2001.
Responsibilities
The Directors of the Company are responsible for the preparation and presentation of the Remuneration Report in accordance
with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the Remuneration Report,
based on our audit conducted in accordance with Australian Auditing Standards.
GRANT THORNTON AUDIT PTY LTD
Chartered Accountants
J L Humphrey
Partner – Audit & Assurance
Adelaide, 25 October 2021
Page 62
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
ADDITIONAL SECURITIES EXCHANGE INFORMATION
Securities Exchange Listing
The Company was admitted to the ASX official list and quotation of its ordinary shares commenced on
21 March 2002. The ASX issuer code is HAV.
Additional information required by the ASX Listing Rules and not disclosed elsewhere in this Annual Report is
set out below. The information was applicable for the Company as at 19 October 2021.
Distribution of Shareholding: Ordinary Shares
The number of shareholders ranked by size of holding is set out below:
Size of Holding
Less than 1,000
1,001 to 5,000
5,001 to 10,000
10,001 to 100,000
100,001 to 1,000,000
More than 1,000,000
Total
Number of
Holders
Number of
Ordinary Shares on
Issue
256
1,041
627
1,387
287
33
3,631
69,512
3,328,296
4,877,103
49,573,846
74,252,407
174,176,064
306,277,228
There were 572 shareholders holding less than a marketable parcel of ordinary shares to the value of $500.
Twenty Largest Shareholders
The names of the twenty largest shareholders of the Company’s ordinary shares are listed below:
Shareholder
Number Held
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
BNP PARIBAS NOMINEES PTY LTD ACF CLEARSTREAM
FIRST NAMES (JERSEY) LIMITED
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
TRINDAL PTY LTD
TRINDAL PTY LTD
GLENCORE AUSTRALIA HOLDINGS PTY LTD
TRINDAL PTY LTD
MR PAUL CLARK
WOOLSTHORPE INVESTMENTS LIMITED
BNP PARIBAS NOMINEES PTY LTD SIX SIS LTD
MISS KRYSTYNA HELENA KASPEROWICZ
ESTATE LATE BRIAN KENNETH MURPHY
TRINDAL PTY LTD
STATSMIN NOMINEES PTY LTD
CITICORP NOMINEES PTY LIMITED
HNC HOLDINGS PTY LTD
STATSMIN NOMINEES PTY LTD
CRAIG PARK PTY LTD
TALAGER PTY LTD
DIANNE PEARL INVESTMENTS PTY LTD
24,230,960
18,014,442
17,527,624
17,457,718
11,073,918
10,153,756
9,804,834
8,176,470
6,480,514
4,049,426
3,701,470
3,687,554
3,437,357
3,401,102
3,069,645
2,654,411
2,647,272
2,563,669
2,172,904
1,935,851
% of Total
Issued
Ordinary
Shares
7.91
5.88
5.72
5.70
3.62
3.32
3.20
2.67
2.12
1.32
1.21
1.20
1.12
1.11
1.00
0.87
0.86
0.84
0.71
0.63
Total
156,240,897
51.01
Page 63
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
ADDITIONAL SECURITIES EXCHANGE INFORMATION (continued)
Substantial Shareholders
The number of ordinary shares held by substantial shareholders and their associates (who held 5% or more of
total fully paid ordinary shares on issue), as disclosed in substantial holder notices given to the Company, is set
out below:
Shareholder
Trindal Pty Ltd
IQ EQ (Jersey) Limited (formerly, First Names (Jersey) Limited)
as Trustee for The Ayscough Trust
Republic Investment Management Pte. Ltd.
Total
Number Held
42,033,909
40,467,686
15,898,489
98,400,084
% of Total Issued
Ordinary Shares
13.72
13.21
5.19
32.12
Unlisted Equity Securities: Share Options
The following share options over unissued ordinary shares of the Company are not quoted:
Director share options
Employee share options
Investec
Total
Number of
Holders
Number of Unlisted
Share Options
1
26
1
28
2,400,000
10,356,874
7,500,000
20,256,874
Voting Rights
(a) Ordinary Shares, Fully Paid
Voting rights of shareholders are governed by the Company’s Constitution. In summary, on a show of hands
every holder of ordinary shares present at a meeting in person or by proxy is entitled to one vote, and upon a
poll each such attending shareholder is entitled to one vote for every fully paid ordinary share held.
The Constitution is available under the Corporate Governance tab on the Company’s website.
(b) Unlisted Share Options
No voting rights.
Other Information
The register of securities is held at Computershare Investor Services Pty Limited Level 5, 115 Grenfell Street,
Adelaide, South Australia 5000. Investor enquiries can be made via telephone on +61 8 8236 2300.
There is no current on-market buy-back.
Page 64
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
TENEMENT SCHEDULE AS AT 31 JULY 2021
Location
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
South Australia
Tenement No
6591
5703
6592
6593
6594
5760
5764
5785
5800
5801
5802
5803
5824
5831
5848
5853
5873 ²
5882
5891 ³
5903
5904
5915 ²
5940
5951
5952
5956
5964
5966
Project Name
Curnamona
Curnamona
Curnamona
Curnamona
Curnamona
Curnamona
Curnamona
Curnamona
Curnamona
Curnamona
Curnamona
Curnamona
Curnamona
Curnamona
Curnamona
Curnamona
Curnamona
Curnamona
Curnamona
Curnamona
Curnamona
Curnamona
Curnamona
Curnamona
Curnamona
Curnamona
Curnamona
Curnamona
Gawler Craton 6014 ⁴
6041
Curnamona
6054
Curnamona
6056
Curnamona
6099
Curnamona
6161
Curnamona
6163
Curnamona
6165
Curnamona
6194
Curnamona
6203
Curnamona
6211
Curnamona
6258
Curnamona
6271
Curnamona
6280 ⁵
Curnamona
6298
Curnamona
6323
Curnamona
6355
Curnamona
6356
Curnamona
6357
Curnamona
6358
Curnamona
6359
Curnamona
6360
Curnamona
6361
Curnamona
6370
Curnamona
6408
Curnamona
6409
Curnamona
6410
Curnamona
6411
Curnamona
6415
Curnamona
6428
Curnamona
Curnamona
6434
Gawler Craton 6468
6546
Curnamona
6567
Curnamona
GEL181
Frome
Tenement Name
Kalabity
Bundera
Mutooroo Mine
Mundi Mundi
Bonython Hill
Bumbarlow
Maljanapa
Moko
Kalkaroo
Mutooroo West
Mulyungarie
Telechie North
Coolibah Dam
Bonython Hill (2)
Mingary (2)
Oratan
Benagerie
Mutooroo(2)
Prospect Hill
Border Block
Mundaerno Hill
Emu Dam
Coonarbine
Jacks Find
Thurlooka
Wompinie
Yalkalpo East
Moolawatana
Pernatty
Cutana
Bindarrah
Frome
Lake Carnanto
Chocolate Dam
Mutooroo South
Poverty Lake
Bundera Dam
Watsons Bore
Cochra
Kidman Bore
Prospect Hill SW
Mingary
Yalkalpo
Lake Charles
Olary
Lake Namba
Swamp Dam
Telechie
Yalu
Woodville Dam
Tepco
Carnanto
Lake Yandra
Tarkarooloo
Lucky Hit Bore
Coombs Bore
Eurinilla
Collins Tank
Lake Frome
Sandstone
Billeroo West
Rocky Dam
Frome
Registered Owner ¹ % Interest
Havilah
Copper Aura
Copper Aura
Havilah
Copper Aura
Havilah
Havilah
Havilah
Havilah
Copper Aura
Havilah
Havilah
Havilah
Copper Aura
Iron Genesis
Havilah
Havilah
Copper Aura
Teale & Brewer
Havilah
Havilah
Havilah
Havilah
Curnamona Energy
Curnamona Energy
Havilah
Curnamona Energy
Curnamona Energy
Red Metal Limited
Iron Genesis
Iron Genesis
Curnamona Energy
Havilah
Havilah
Copper Aura
Havilah
Havilah
Havilah
Havilah
Havilah
Havilah
Iron Genesis
Curnamona Energy
Havilah
Havilah
Havilah
Havilah
Havilah
Havilah
Havilah
Iron Genesis
Havilah
Havilah
Havilah
Havilah
Havilah
Havilah
Havilah
Havilah
Havilah
Havilah
Havilah
Geothermal
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
65
100
100
100
100
100
100
100
100
100
10
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
Status
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Page 65
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
TENEMENT SCHEDULE AS AT 31 JULY 2021 (continued)
Project Name
Location
Kalkaroo
South Australia
Kalkaroo
South Australia
Kalkaroo
South Australia
Kalkaroo
South Australia
Kalkaroo
South Australia
South Australia
Kalkaroo
South Australia Maldorky
South Australia Maldorky
South Australia Maldorky
South Australia Maldorky
South Australia Maldorky
South Australia Mutooroo
South Australia Mutooroo
South Australia Mutooroo
Tenement No
ML6498
ML6499
ML6500
MPL158
MPL159
MC3828
MC4271
MC4272
MC4273
MC4274
MC4364
ML5678
MC3565
MC3566
Tenement Name
Kalkaroo
Kalkaroo
Kalkaroo
Kalkaroo
Kalkaroo
Kalkaroo
Maldorky
Maldorky
Maldorky
Maldorky
Maldorky
Mutooroo
Mutooroo
Mutooroo
Registered Owner ¹
Kalkaroo
Kalkaroo
Kalkaroo
Kalkaroo
Kalkaroo
Kalkaroo
Maldorky
Maldorky
Maldorky
Maldorky
Maldorky
Havilah
Mutooroo
Mutooroo
% Interest
100
100
100
100
100
100
100
100
100
100
100
100
100
100
Status
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Current
Notes to Tenement Schedule as at 31 July 2021
Note 1
Havilah:
Copper Aura:
Curnamona
Energy:
Geothermal:
Havilah Resources Limited
Copper Aura Pty Ltd, a wholly owned subsidiary of Havilah Resources Limited
Curnamona Energy Pty Limited, a wholly owned subsidiary of Havilah Resources Limited
Geothermal Resources Pty Limited, a wholly owned subsidiary of Havilah Resources Limited
Iron Genesis:
Iron Genesis Pty Ltd, a wholly owned subsidiary of Havilah Resources Limited
Kalkaroo:
Maldorky:
Mutooroo:
Red Metal:
Teale &
Brewer:
Kalkaroo Copper Pty Ltd, a wholly owned subsidiary of Havilah Resources Limited
Maldorky Iron Pty Ltd, a wholly owned subsidiary of Havilah Resources Limited
Mutooroo Metals Pty Ltd, a wholly owned subsidiary of Havilah Resources Limited
Red Metal Limited
Teale & Associates Pty Ltd, Adrian Mark Brewer
Note 2 - 1% NSR (Net Smelter Return) royalty payable to MMG Limited
Note 3 - Agreement – farm-in to earn 85% interest in tenement
Note 4 - Agreement – farm-in, carried interest 10%
Note 5 - 1.25% NSR royalty payable to Exco Operations (SA) Pty Limited, Polymetals (White Dam) Pty Ltd
Page 66
ASX CODE: HAV
HAVILAH RESOURCES LIMITED
ABN: 39 077 435 520 ANNUAL REPORT FOR THE FINANCIAL YEAR ENDED 31 JULY 2021
GLOSSARY
Term
Definition
$, AUD or cents
Units of Australian currency.
AEA
ASX
ATO
CMC
Amalgamated Expenditure Agreement.
ASX Limited ABN 98 008 624 691, trading as Australian Securities Exchange.
Australian Taxation Office.
Consolidated Mining & Civil Pty Ltd.
Company or Havilah Havilah Resources Limited.
consolidated entity
The provisions of the Corporations Act 2001 use the term ‘consolidated entity’, rather
than ‘Group’.
COVID-19
coronavirus disease 2019.
DEM
EL
ESG
eU3O8
EV
Fe
Department for Energy and Mining (the regulator in South Australia).
Exploration Licence.
environmental, social and governance.
equivalent uranium oxide.
electric vehicle.
iron.
financial year
the financial year ended 31 July 2021.
FVTPL
GEL
Group
GST
g/t
Investec
JORC
km, km2
koz, Moz
kt
fair value through profit or loss.
Geothermal Exploration Licence.
Havilah Resources Limited and its subsidiaries.
Goods and Services Tax.
gram/tonne.
Investec Australia Finance Pty Limited.
Joint Ore Reserves Committee.
kilometres and square kilometres respectively.
thousand troy ounces and million troy ounces respectively.
thousand tonnes.
MC, ML, MPL
Mining Claim, Mining Lease and Miscellaneous Purposes Licence respectively.
MT
Mt
NAWNTAC
NPV
magnetotelluric.
million tonnes.
Ngadjuri Adnyamathanha Wilyakali Native Title Aboriginal Corporation.
Net Present Value. NPV is based on 100% equity, real (2019) terms and ungeared.
The model is based on calendar years.
Parent Company
Havilah Resources Limited.
PEPR
PFS
Plan
ppm
REE
Program for Environment Protection and Rehabilitation.
pre-feasibility study.
Performance Rights and Share Option Plan.
parts per million.
rare earth elements.
SIMEC Mining
OneSteel Manufacturing Pty Limited (trading as SIMEC Mining).
t
tonnes.
US$ or USD
United States dollars.
Page 67