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Corporate Directory
Corporate Review
Review of Operations
Introduction
Review of Projects
Corporate Governance
Directors’ Report
Independent Audit Report
Directors’ Declaration
Statement of Financial Position
Statement of Financial Performance
Statement of Cashflows
Notes to the Financial Statements
Shareholding Information
Tenement Schedule
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55
Directors
Dr. G. Michael Folie Chairman
Robert W Mosig
Anthony R Martin
Ian K Macpherson
Bryce E Wauchope
Managing Director
Executive Director
Non Executive Director
Non Executive Director
Company Secretary
Riccardo E Vittino
Head and Registered Office
Level 3, 24 Kings Park Road
West Perth Western Australia 6005
PO Box 825 West Perth Western Australia 6872
+61 8 9321 2644
Telephone:
+61 8 9321 6909
Facsimilie:
helix@helix.net.au
Email:
http://helix.net.au
Website:
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
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Dear Shareholder,
We are pleased to present the Annual Report of the
Company for the year 2004.
Whilst the year has been a positive one overall for
the Company, it has also produced its share of
challenges. In February, in conjunction with the first
JORC compliant ore resource estimation, we
announced the acquisition of full ownership of the
Tunkillia Gold Project and the commencement of
the Tunkillia Gold Project Feasibility Study in the
Gawler Craton region of South Australia. However,
later in the year, a setback to the early completion of
the Feasibility Study (including further exploration)
occurred when the Company was forced to suspend
all activities at Tunkillia following the under-
subscribed Rights Issue offer to all shareholders.
Due to the low level of cash
available, the Company
reassessed the work program
at Tunkillia and focussed
more on exploration and less
on engineering. Furthermore
the necessity to carry out an
estimated $5.0 million of exploration to advance the
project toward a Feasibility Study, contributed to
this decision.
In October, the Company announced that it had
postponed the future development of the Tunkillia
Project until such time that Helix finds a suitable
joint venture partner. The current resource estimate
for this exciting gold project stands at 10.5 million
tonnes grading 2.2 g/t for 730,000 ounces of gold.
Further activities at the Company’s Gawler Craton
tenements are definitely warranted, and your Board
is hopeful of an early recommencement to the
unfinished work.
The Company has a quality exploration portfolio.
Details on the gold and nickel, copper and platinum
group metals prospectivity of the Mt Venn and
Narracoota projects are contained in this Annual
Report. At the Mt Venn project, for
instance there has been very limited exploration
since the 1960’s nickel boom, yet the project area
contains large thicknesses of mafic and ultramafic
rocks which have the potential to contain nickel and
copper sulphide accumulations as well as platinum
group metals.
The Company must now raise further funds as it has
already begun to carry out important and innovative
exploration at most of the
project areas outlined in this
report. We plan to address
fund raising before the end
of 2004 and the Board looks
forward to your continued
support.
Against the backdrop of a major worldwide
reduction in exploration, your Company is confident
that it can continue to find new discoveries within
Australasia. The Helix exploration team remains
committed to success by new project generation
which will be partially funded where possible by
major mining companies who recognise the
importance of the Helix contribution. On this front,
I am pleased to advise that negotiations are
underway to joint venture our exciting grass roots
Loongana Project in the Nullarbor region of
Western Australia. Full details are contained in the
review of operations in this report.
Exploration has always been a strong focus for the
Company over its nineteen years as an Australian
Stock Exchange listed junior explorer. During this
time, the Company has made many important
discoveries from grass roots projects which have
often impacted significantly on its share price.
The Company reported a loss of $4.77 million
during the year, related essentially to revaluation of
carry forward exploration expenditure. The cash
reserves available to the Company at the time of
writing are $1.3 million. In view of the limited
funds available, negotiations to sell non-core asset
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
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projects are in progress, and their potential sale may
provide additional cash as well as new share
investments for the Company.
As part of the new focus on exploration a detailed
review of the activities of the Company was
undertaken resulting in reductions in corporate
overheads and salaries.
In May of this year the Board appointed Dr Michael
Folie as Chairman of Helix Resources. Since then
the Chairman and the Managing Director have
worked closely on the strategic future planning for
the Company. Dr Folie’s decision not to seek
shareholder ratification of his appointment at the
Annual General Meeting to be held in November
has been accepted with regret, and the Board
acknowledges his thorough and excellent
contribution.
As a result of this change, Robert Mosig has been
appointed the Executive Chairman and the size and
content of the Company’s Board of Directors is
being reviewed.
On behalf of the Board, we look forward to meeting
as many shareholders as possible at our Annual
General Meeting on the30th November, and
specifically, your Board looks forward to a
commitment to make 2005 a productive and
successful year.
Dr G M Folie
Chairman
Robert W Mosig
Managing Director
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
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INTRODUCTION
During the past 12 months the company has made
significant advances in its effort to develop the
Tunkillia Gold Project at Lake Everard in the
Gawler Craton of South Australia. By early 2004
the company had outlined a JORC resource of
730,000 oz of gold at 2.2g/t at the Area 223
prospect. A subsequent Scoping Study indicated
that at a gold price of $550 per ounce about 390,000
oz of this resource was mineable at a grade of 2.4g/t
by open cut methods. Based on these results the
company commenced the preliminary phase of a
Feasibility Study, including further resource drilling
and technical studies into potential gold mining at
Area 223.
Progress on the Feasibility Studies slowed during
the later part of the year due to lack of funds
provided from an under subscribed Rights Issue.
Resource Inventory
Exploration during the year at other projects
included further drilling at the Highway nickel
laterite deposit by Heron Resources and extensive
regional diamond exploration sampling by DeBeers
in the Munni Munni region. Negotiations were also
commenced during the year to secure a joint venture
partner for the Loongana Ni, Cu, PGM prospect in
the Nullarbor region of Western Australia.
In addition to its well maintained exploration
portfolio the Company retains a strong resource
base across a selection of commodities and is well
positioned to continue to take advantage of future
changes in commodity prices.
Project
Commodity Equity Grade and Tonnage
Contained Metal
Lake Everard
Au
100%
10.5Mt at 2.2g/t Au
730,000 oz
Munni Munni
PGM
100%
24.0Mt at 2.9g/t PGM + Au
2,240,000 oz
Glenburgh
Fifield
Menzies
Au
PGM
Ni Co
Ni Co
100%
1.4Mt at 1.9g/t Au
100%
10.2Mt at 0.6g/t Pt
90,000 oz
200,000 oz
100%
2.0Mt at 0.18% Co & 0.35% Ni
3600t Co, 7000t Ni
40%
6.0Mt at 1.4% Ni & 0.11% Co
84,000t Ni, 6,600t Co
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
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GOLD PROJECTS
RESOURCES
LAKE EVERARD
– GAWLER CRATON, SOUTH AUSTRALIA
Helix Resources Limited – 100%
The Lake Everard Gold Project is located 700
kilometres north-west of Adelaide in South
Australia’s Gawler Craton. The project area of
3,250 square kilometres is comprised 2 Exploration
Licences and 1 Exploration Licence application.
Area 223 Resource Estimate
Prior to May 2003, a resource review by
AngloGold estimated that Area 223 contained
approximately 220,000 oz of gold grading 2.5g/t
Au. In the second half of 2003 Helix conducted a
14,000 metre infill drilling program to enhance the
resource. As a result AMC Consultants calculated
the first JORC resource estimate for Area 223 of
10.5 Mt grading 2.2g/t Au containing 730,000 oz.
Area 223 Resource
Contained Gold
Classification
5.4Mt @ 2.1g/t
5.1Mt @ 2.2g/t
10.5Mt @ 2.2g/t
370,000oz
360,000oz
730,000oz
(Indicated)
(Inferred)
(JORC)
The Tunkillia gold deposit is wholly located within
the Lake Everard tenement, EL2697. Helix
acquired the Project in 1996 to explore for gold in
Mesopoterozoic geological settings.
In May 2003, Helix purchased AngloGold’s 49%
joint venture interest in the Lake Everard Project
and then carried out a reverse circulation drilling
program.
The new resource estimate was subjected to
additional optimisation studies which indicated that
the exploitable resource was 392,000 oz of gold
with a head grade of 2.4g/t within an AUD$550 pit
shell.
Further studies estimated cash costs of potential
production were AUD$375 per oz of gold at a
stripping ratio of 7.5:1, generating an undiscounted
pre-tax cash flow of $62 million. Capital costs were
estimated at $25 million, producing a net positive
cash flow for the project of $37 million (refer table
below).
Summary of Area 223 Whittle Optimisation Studies
Gold Price
AUD$/oz
500
550
600
Contained
Gold
oz
347,000
392,000
444,000
Grade
Gold
g/t
2.4
2.4
2.3
Strip
Ratio
w : o
7.4
7.5
7.9
Recovered
Gold
oz
319,000
362,000
408,000
Cash
Cost
AUD$/oz
355
375
400
Undisc
Cash Flow
$m
44.9
62.0
81.1
Nett positive
Cash Flow
$m
19.9
37.0
56.1
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In May and June 2004 a further 24 RC holes of a
planned 40 hole program were drilled into the Area
223 resource. Drilling concentrated on the poorly
drilled northern end of the resource and the higher
grade Area 223 South zone. The better gold
intersections from the drilling program included
15m at 7.7g/t, 5m at 15.3g/t and 3m at 16.9g/t.
The results confirm that Area 223 South which
remains open along strike to the south has potential
to provide additional high grade resource ( refer
Section 110700 mN below).
EXPLORATION POTENTIAL
Area 223 covers approximately 5 percent of the
entire Tunkillia gold-in-calcrete anomaly. Basement
drilling outside of Area 223 is generally sparse, with
only a limited number of targets drilled to date. Of
the targets drilled, a number have returned
intersections greater than 1g/t Au.
Furthermore,the north-westerly trending shear zone
which hosts the Area 223 resource has only been
drilled on 10 RC traverses over its remaining 7.5km
length along strike from the resource.
Elsewhere at Tunkillia, an Induced Polarisation
survey has been successful in identifying several
new and untested anomalies which may represent
potential areas of sulphide and gold mineralisation
along strike of Area 223.
Regional calcrete sampling has been completed
over two thirds of the total 3,250 sq km under
tenure in the Lake Everard region with basement
drilling limited to the Tunkillia Anomaly. There are
numerous high priority geochemical and
geophysical targets still to be explored within the
project area.
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
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FEASIBILITY STUDIES
Following the appointment of personnel for the
Tunkillia Feasibility Study in May 2004, the team
carried out a preliminary assessment of the mining
characteristics of the Area 223 resource. The aim of
this initial study was to re-optimise the resource,
incorporating the new drilling results completed in
2004 and open cut mining methods considered
applicable to the proposed mining of Area 223.
Studies completed to date indicate that the gold
mineralisation at Area 223 is sufficiently continuous
and robust to be mined economically at a rate of 70-
80,000 oz per annum, although some further infill
drilling is required to fully quantify this based on an
Indicated resource.
Whilst the current project economic estimations
indicate a positive cash flow of approximately $37
million at an AUD$550 gold price, there is a high
capital cost requirement for the removal of the 40 to
50 metres of overburden. The total capital cost of
plant, infrastructure and overburden removal would
be in the order of $35 to 40 million. A longer life
project would provide a better return and have
lower risk.
Based on the additional exploration potential
highlighted by the latest drilling, the study team
have recommended that the company conduct
further exploration to increase the resource, thereby
reducing the project risk associated with the high
level of initial debt. Further exploration drilling is
planned for 2005 to increase the exploitable
resource at Area 223 to at least 550,000 oz.
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
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NARRACOOTA GOLD PROJECT –
WESTERN AUSTRALIA
Helix Resources Limited – 90%
The Narracoota Gold Project is located in the
southern part of the Peak Hill gold field north of
Meekatharra in Western Australia. The project
consists of three Exploration Licences which cover
a series of large WNW trending structural zones
that are prospective for gold mineralisation. Much
of the tenement area is covered by overburden to a
thickness of 5 metres. Historically, exploration in
the region has concentrated on prospects
outcropping within these covered areas.
Technical reviews carried out by Helix indicate that
the covered areas remain highly prospective for
gold mineralisation of a style similar to those at the
Fortnum and Peak Hill mines.which occur along the
contacts between Proterozoic volcanics and
sediments.
The company is planning to carry out a regional
geochemical program in October 2004.
GLENBURGH PROJECT
– WESTERN AUSTRALIA
Helix Resources Limited – 100%
The Glenburgh Gold Project is located 300
kilometres east of Carnarvon in the Gascoyne
Region. The Project was one of Helix’s early
discoveries, with significant gold mineralisation
first identified in 1994 and subsequent drilling
delineating a 36 square kilometre mineralised zone.
Exploration for gold at Glenburgh has identified a
number of high grade zones over 10 kilometres of
strike-length within a large Proterozoic shear zone.
In early 2003, drilling to identify the down plunge
extensions at the most prospective of these zones,
the Apollo Prospect, produced impressive results
including 6m at 20.5g/t Au.The current resource at
Apollo stands at 57,000oz grading 2.9g/t. These
results indicate there is potential to increase the
resource with further drilling.
Earlier drilling throughout the project area had
identified a number of other zones of high grade
gold which are now worthy of further follow-up
drilling based on the new plunge direction
information obtained from the recent drilling at
Apollo.
Shallow vacuum drilling in 2003 immediately east
of Apollo provided geochemical evidence that there
may also be additional gold lodes buried beneath
thin alluvial cover.
Exploration at Glenburgh will continue in early
2005 addressing these new drilling targets.
ISOLATED HILL PROJECT
– WESTERN AUSTRALIA
Helix Resources Limited – 100%
The Isolated Hill Project comprises two Exploration
Licences covering 393 square kilometres of
greenstone belt in the Eastern Goldfields. Located
150km east of Laverton it is adjacent to the
prospective Yamarna greenstone belt.
Only 40% of the Isolated Hill greenstone belt has
been sampled by previous tenement holders in the
1990’s. This work reported geochemical gold up to
420ppb, and outlined two significant gold in soil
anomalies which are above the 10ppb level. The
anomalies are 2.5km and 1.2km long respectively
and have not been drill tested. Follow up work
including a program of surface sampling and drill
testing is planned for 2005. Further exploration will
also include evaluations for nickel and PGM’s.
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
MENZIES NICKEL PROJECT
– WESTERN AUSTRALIA
Helix Resources Limited 40%
During the year our joint venture partner, Heron
Resources Ltd, solely funded 125 holes of reverse
circulation drilling, covering 6.5 kilometres of strike
of Walter Williams Formation. Extensive
ferruginous lateritic ore was encountered.
Significant intersections included, 12 metres at
1.63% Ni from 8 metres depth, 12 metres at 1.25%
Ni 23 metres depth, 8 metres at 1.38% Ni 4 metres
depth and 19 metres at 1.01% Ni 14 metres depth.
Nickel laterite mineralisation has now been verified
to exist in the Menzies Highway Project area over a
strike length of some 6.5 kilometres and it has
potential to make a significant contribution to the
ore-feed for the Kalgoorlie Nickel Project which is
to be centred at Goongarrie, some 30 kilometres to
the south.
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PLATINUM GROUP METALS AND
NICKEL PROJECTS
MUNNI MUNNI PGM PROJECT
– WESTERN AUSTRALIA
Helix Resources Limited – 100%
Exploration and development of the Munni Munni
PGM project was put on hold in late 2002 due to the
dramatic slump in the palladium price. The
Company is continuing to investigate the possibility
of selectively mining the high grade PGM shoots
within the resource. These high grade zones contain
over 1.4 million oz of PGM and gold at a grade of
3.3g/t, with widths in places in excess of 5 metres.
The Company maintains a positive view on the
longer term future of all PGM’s and considers
Munni Munni a valuable future asset.
MT VENN Ni PGM PROJECT
– WESTERN AUSTRALIA
Helix Resources Limited – earning 80%
The Mt Venn project, located east of Laverton in
WA, first attracted interest to explorers during the
late 1960’s nickel boom when Tasminex NL drilled
a series of sulphide bearing holes on the margin of a
large layered mafic/ultramafic intrusion. The project
area is located within a Native Reserve and since
the early 1970’s the area has been excluded from
exploration.
Exploration during the early 1970’s discovered a
series of surface gossans associated with the
magmatic sulphide horizons and analyses of these
recorded up to 0.8% Ni and 1% Cu, however, no
analyses for PGM’s were carried out. Drilling at Mt
Venn has also been limited to one small area of the
intrusion.
The prominent sulphide horizons at Mt Venn offer
an attractive new exploration target for nickel and
PGM’s in a previously unrecognized PGM region of
Western Australia.
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
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LOONGANA Ni PGM PROJECT
Helix Resources Limited – 100%
DIAMOND EXPLORATION
PROJECTS
WEST PILBARA JOINT VENTURE
– WESTERN AUSTRALIA
Helix Resources Limited – 100%, De Beers
Australia Exploration Limited earning 51%
During the year De Beers conducted an extensive
stream sampling program over 4 of the tenements
comprising the West Pilbara Joint Venture
(proximal to the Munni Munni PGM project) . The
sampling produced several areas which contained
kimberlitic spinel and De Beers are currently
conducting detailed follow-up sampling.
The Loongana Project is located in Western
Australia’s Eucla Basin, approximately 475
kilometres east of Kalgoorlie and 30 kilometres
north of the Trans-Australia Rail Line. The Project
was identified as a potential PGM/nickel
exploration opportunity because of the presence of a
geophysical anomaly which indicates a large
layered mafic/ultramafic complex at depth.
The anomaly is some 100 kilometres long and up to
15 kilometres wide, about three times the size of the
Munni Munni complex.
Two diamond drill holes completed at Loongana in
2002/2003 intersected cumulate gabbros,
pyroxenites and dunite, confirming the geophysical
interpretation of the anomaly and its prospectivity
for PGM deposits. Possible exploration models
include both the Bushveld style layered
mafic/ultramafic hosted PGM targets and
Jinchuan/Voisey’s Bay style nickel-copper-PGM
style mineralisation.
Helix is currently in negotiations with companies
who have shown interest in joint venturing into the
project for nickel exploration.
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
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The Company is committed to implementing the highest standards of corporate governance. In determining what those high
standards should involve the Company has turned to the ASX Corporate Governance Council’s Principles of Good
Corporate Governance and Best Practice Recommendations. The Company is pleased to advise that the Company’s
practices are largely consistent with those ASX guidelines. As consistency with the guidelines has been a gradual process,
where the Company did not have certain policies or committees recommended by the ASX Corporate Governance Council
(the Council) in place during the reporting period, we have identified such policies or committees.
Where the Company’s corporate governance practices do not correlate with the practices recommended by the Council, the
Company does not consider that the practices are appropriate for the Company due to the size of Company operations.
To illustrate where the Company has addressed each of the Council’s recommendations, the following table cross-
references each recommendation with sections of this report. The table does not provide the full text of each
recommendation but rather the topic covered. Details of all of the recommendations can be found on the ASX Corporate
Governance Council’s website at http://www.asx.com.au/about/CorporateGovernance_AA2.shtm.
Recommendation
Recommendation 1.1 Functions of the Board and Management
Recommendation 2.1 Independent Directors
Recommendation 2.2 Independent Chairman
Recommendation 2.3 Role of the Chairman and CEO
Recommendation 2.4 Establishment of Nomination Committee
Recommendation 2.5 Reporting on Principle 2
Recommendation 3.1 Directors’ and Key Executives’ Code of Conduct
Recommendation 3.2 Company Security Trading Policy
Recommendation 3.3 Reporting on Principle 3
Recommendation 4.1 Attestations by CEO and CFO
Recommendation 4.2 Establishment of Audit Committee
Recommendation 4.3 Structure of Audit Committee
Recommendation 4.4 Audit Committee Charter
Recommendation 4.5 Reporting on Principle 4
Recommendation 5.1 Policy for Compliance with Continuous Disclosure
Recommendation 5.2 Reporting on Principle 5
Recommendation 6.1 Communications Strategy
Recommendation 6.2 Attendance of Auditor at General Meetings
Recommendation 7.1 Policies on Risk Oversight and Management
Recommendation 7.2 Attestations by CEO and CFO
Recommendation 7.3 Reporting on Principle 7
Recommendation 8.1 Evaluation of Board, Directors and Key Executives
Recommendation 9.1 Remuneration Policies
Recommendation 9.2 Establishment of Remuneration Committee
Recommendation 9.3 Executive and Non-Executive Director Remuneration
Recommendation 9.4 Equity-Based Executive Remuneration
Recommendation 9.5 Reporting on Principle 9
Recommendation 10.1 Company Code of Conduct
Section
1.1
1.2
1.2
1.2
2.3
1.2, 1.4.6, 2.3.2 and the
Directors’ Report
1.1
1.4.9
1.1 and 1.4.9
1.4.11
2.1
2.1.2
2.1
2.1
1.4.4
1.4.4
1.4.8
1.4.8
2.1.3
1.4.11
2.1.3
1.4.10
2.2.4
2.2
2.2.4.1 and 2.2.4.2
2.2.4.1
2.2.2 and 2.2.4
3
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1.
1.1
Board of Directors
Role of the Board
The Board’s role is to govern the Company rather than to manage it. In governing the Company, the Directors must act in
the best interests of the Company as a whole. It is the role of senior management to manage the Company in accordance
with the direction and delegations of the Board and the responsibility of the Board to oversee the activities of management
in carrying out these delegated duties.
In carrying out its governance role, the main task of the Board is to drive the performance of the Company. The Board must
also ensure that the Company complies with all of its contractual, statutory and any other legal obligations, including the
requirements of any regulatory body. The Board has the final responsibility for the successful operations of the Company.
To assist the Board carry our its functions, it has developed a Code of Conduct to guide the Directors, the Chief Executive
Officer, the Chief Financial Officer and other key executives in the performance of their roles.
1.2
Composition of the Board
To add value to the Company the Board has been formed so that it has effective composition, size and commitment to
adequately discharge it responsibilities and duties. The names of the Directors and their qualifications and experience are
stated in Directors’ Report along with the term of office held by each of the Directors. Directors are appointed based on the
specific governance skills required by the Company and on the independence of their decision-making and judgment.
The Company recognises the importance of Non-Executive Directors and the external perspective and advice that Non-
Executive Directors can offer. Dr M Folie, Mr I Macpherson, and Mr B Wauchope are all Non-Executive Directors. In
addition to being Non-Executive Directors, Dr M Folie, Mr I Macpherson, and Mr B Wauchope also meet the following
criteria for independence adopted by the Company.
An Independent Director:
1.
2.
is a Non-Executive Director and:
is not a substantial shareholder of the Company or an officer of, or otherwise associated directly with, a substantial
shareholder of the Company;
3. within the last three years has not been employed in an executive capacity by the Company or another group
member, or been a Director after ceasing to hold any such employment;
4. within the last three years has not been a principal of a material professional adviser or a material consultant to the
Company or another group member. Or an employee materially associated with the service provided;
5.
is not a material supplier or customer of the Company or another group member, or an officer of or otherwise
associated directly or indirectly with a material supplier or customer;
6. has no material contractual relationship with the Company or other group member other than as a Director of the
Company;
7. has not served on the Board for a period which could, or could reasonably be perceived to, materially interfere with
the Director’s ability to act in the best interests of the Company; and
8.
is free from any interest and any business or other relationship which could, or could reasonably be perceived to,
materially interfere with the Director’s ability to act in the best interests of the Company.
1.3
Responsibilities of the Board
In general, the Board is responsible for, and has the authority to determine, all matters relating to the policies, practices,
management and operations of the Company. It is required to do all things that may be necessary to be done in order to
carry out the objectives of the Company.
Without intending to limit this general role of the Board, the principal functions and responsibilities of the Board include the
following.
1. Leadership of the Organisation: overseeing the Company and establishing codes that reflect the values of the
Company and guide the conduct of the Board.
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2. Strategy Formulation: working with senior management to set and review the overall strategy and goals for the
Company and ensuring that there are policies in place to govern the operation of the Company.
3. Overseeing Planning Activities: overseeing the development of the Company’s strategic plan and approving that
plan as well as the annual and long term budgets.
4. Shareholder Liaison:
ensuring effective communications with shareholders
through an appropriate
communications policy and promoting participation at general meetings of the Company.
5. Monitoring, Compliance and Risk Management: overseeing the Company’s risk management, compliance, control
and accountability systems and monitoring and directing the financial and operational performance of the
Company.
6. Company Finances: approving expenses in excess of those approved in the annual budget and approving and
monitoring acquisitions, divestitures and financial and other reporting.
7. Human Resources: appointing, and, where appropriate, removing the Chief Executive Officer (CEO) and Chief
Financial Officer (CFO) as well as reviewing the performance of the CEO and monitoring the performance of
senior management in their implementation of the Company’s strategy.
8. Ensuring the Health, Safety and Well-Being of Employees: in conjunction with the senior management team,
developing, overseeing and reviewing the effectiveness of the Company’s occupational health and safety systems
to ensure the well-being of all employees.
9. Delegation of Authority: delegating appropriate powers to the CEO to ensure the effective day-to-day management
of the Company and establishing and determining the powers and functions of the Committees of the Board.
1.4
Board Policies
1.4.1
Conflicts of Interest
Directors must:
(cid:131)
(cid:131)
disclose to the Board actual or potential conflicts of interest that may or might reasonably be thought to exist
between the interests of the Director and the interests of any other parties in carrying out the activities of the
Company; and
if requested by the Board, within seven days or such further period as may be permitted, take such necessary and
reasonable steps to remove any conflict of interest.
If a Director cannot or is unwilling to remove a conflict of interest then the Director must, as per the Corporations Act,
absent himself or herself from the room when discussion and/or voting occurs on matters about which the conflict relates.
1.4.2
Commitments
Each member of the Board is committed to spending sufficient time to enable them to carry out their duties as a Director of
the Company.
1.4.3
Confidentiality
In accordance with legal requirements and agreed ethical standards, Directors and key executives of the Company have
agreed to keep confidential, information received in the course of the exercise of their duties and will not disclose non-
public information except where disclosure is authorised or legally mandated.
1.4.4
Continuous Disclosure
The Board has designated the Company Secretary as the person responsible for overseeing and coordinating disclosure of
information to the ASX as well as communicating with the ASX. In accordance with the ASX Listing Rules the Company
immediately notifies the ASX of information:
1. concerning the Company that a reasonable person would expect to have a material effect on the price or value of
the Company’s securities; and
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2.
that would, or would be likely to, influence persons who commonly invest in securities in deciding whether to
acquire or dispose of the Company’s securities.
Upon confirmation of receipt from the ASX, the Company posts all information disclosed in accordance with this policy on
the Company’s website in an area accessible by the public.
1.4.5
Education and Induction
New Directors undergo an induction process in which they are given a full briefing on the Company. Where possible, this
includes meetings with key executives, tours of the premises, an induction package and presentations. Information
conveyed to new Directors include:
(cid:131)
(cid:131)
(cid:131)
(cid:131)
details of the roles and responsibilities of a Director;
formal policies on Director appointment as well as conduct and contribution expectations;
details of all relevant legal requirements;
access to a copy of the Board Charter;
(cid:131) Guidelines on how the Board processes function;
(cid:131)
(cid:131)
(cid:131)
(cid:131)
(cid:131)
details of past, recent and likely future developments relating to the Board;
background information on and contact information for key people in the organisation;
an analysis of the Company;
a synopsis of the current strategic direction of the Company including a copy of the current strategic plan and
annual budget; and
a copy of the Constitution of the Company.
In order to achieve continuing improvement in Board performance, all Directors are encouraged to undergo continual
professional development.
1.4.6
Independent Professional Advice
The Board collectively and each Director has the right to seek independent professional advice at the Company’s expense,
up to specified limits, to assist them to carry out their responsibilities.
1.4.7
Related Party Transactions
Related party transactions include any financial transaction between a Director and the Company and will be reported in
writing to each Board meeting. Unless there is an exemption under the Corporations Act from the requirement to obtain
shareholder approval for the related party transaction, the Board cannot approve the transaction.
1.4.8
Shareholder Communication
The Company respects the rights of its shareholders and to facilitate the effective exercise of those rights the Company is
committed to:
1. communicating effectively with shareholders through releases to the market via ASX, the Company’s website,
information mailed to shareholders and the general meetings of the Company;
2. giving shareholders ready access to balanced and understandable information about the Company and corporate
proposals;
3. making it easy for shareholders to participate in general meetings of the Company; and
4.
requesting the external auditor to attend the annual general meeting and be available to answer shareholder
questions about the conduct of the audit and the preparation and content of the auditor’s report.
The Company also makes available a telephone number and email address for shareholders to make enquiries of the
Company.
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1.4.9
Trading in Company Shares
The Company has a Share Trading Policy under which Directors and certain employees and their associates may only trade
in the Company’s securities during the 30 days commencing immediately after each of the following (“trading window”):
(cid:131)
(cid:131)
(cid:131)
(cid:131)
the release by the Company of its half-yearly results to the ASX;
the release by the Company of its annual results to the ASX;
the close of the general meeting of the Company; and
the release by the Company of its Quarterly Reports to the ASX.
In addition, consistent with the law, designated officers are prohibited from trading in the Company’s securities while in the
possession of unpublished price sensitive information concerning the Company. Unpublished price sensitive information is
information regarding the Company, of which the market is not aware, that a reasonable person would expect to have a
material effect on the price or value of the Company’s securities.
Notice of an intention to trade must be given prior to trading in the Company’s securities as well as a confirmation that the
person is not in possession of any unpublished price sensitive information. The completion of any such trade by a Director
must also be notified to the Company Secretary who in turn advises the ASX.
1.4.10 Performance Review/Evaluation
Each year the Board conducts an evaluation of its performance. The evaluation for this and past financial years was
conducted internally. The Board’s performance was measured against both qualitative and quantitative indicators. The
objective of this evaluation was to identify strengths and weaknesses and provide best practice corporate governance to the
Company. In future years this process may carried out by an external consultant.
1.4.11 Attestations by CEO and CFO
In accordance with the Board’s policy, the CEO and the CFO made the attestations recommended by the ASX Corporate
Governance Council as to the Company’s financial condition prior to the Board signing this Annual Report.
2.
2.1
Board Committees
Audit Committee
The Audit Committee was formed by resolution of the Board. Below is a summary of the role, composition and
responsibilities of the Audit Committee. Further details are contained in the Audit Committee’s Charter.
2.1.1
Role
The Audit Committee is responsible for reviewing the integrity of the Company’s financial reporting and overseeing the
independence of the external auditors.
2.1.2
Composition
The Audit Committee consists of two members. Members are appointed by the Board from amongst the Non-Executive
Directors. The current members of the Audit Committee are Mr I Macpherson, and Mr B Wauchope. Mr B Wauchope is
the Chairman of the Audit Committee
The Audit Committee held two meetings throughout the year and details of attendance of the members of the Audit
Committee are contained in the Directors’ Report.
2.1.3
Responsibilities
The Audit Committee reviews the audited annual and half-yearly financial statements and any reports which accompany
published financial statements before submission to the Board and recommends their approval.
The Audit Committee also recommends to the Board the appointment of the external auditor and each year, reviews the
appointment of the external auditor, their independence, the audit fee, and any questions of resignation or dismissal.
The Audit Committee is also responsible for establishing policies on risk oversight and management.
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2.2
Remuneration Committee
The Remuneration Committee was formed by resolution of the Board.
2.2.1
Role
The role of the Remuneration Committee is to assist the Board in fulfilling its responsibilities in respect of establishing
appropriate remuneration levels and incentive policies for employees.
2.2.2
Composition
Dr M Folie, Mr I Macpherson and Mr B Wauchope are the current members of the Remuneration Committee. Dr M Folie is
the Chairman of the Remuneration Committee.
The Remuneration Committee held one meeting throughout the year and details of attendance of the members of the
Committee are contained in the Directors’ Report.
2.2.3
Responsibilities
The responsibilities of the Remuneration Committee include setting policies for senior officers’ remuneration, setting the
terms and conditions of employment for the Chief Executive Officer, reviewing and making recommendations to the Board
on the Company’s incentive schemes and superannuation arrangements, reviewing the remuneration of both Executive and
Non-Executive Directors and making recommendations to the Board on any proposed changes and undertaking an annual
review of the Chief Executive Officer’s performance, including, setting with the Chief Executive Officer goals for the
coming year and reviewing progress in achieving these goals.
2.2.4
Remuneration Policy
The Senior Executives’ Remuneration Policy was approved by resolution of the Board in 2003 and the Non-Executive
Director Remuneration Policy was also approved by resolution of the Board in 2003.
2.2.4.1 Senior Executive Remuneration Policy
The Company is committed to remunerating its senior executives in a manner that is market-competitive and consistent with
best practice as well as supporting the interests of shareholders. Consequently, under the Senior Executive Remuneration
Policy the remuneration of senior executive may be comprised of the following:
(cid:131)
(cid:131)
(cid:131)
(cid:131)
fixed salary that is determined from a review of the market and reflects core performance requirements and
expectations;
a performance bonus designed to reward actual achievement by the individual of performance objectives and for
materially improved Company performance;
participation in share/option schemes with thresholds approved by shareholders;
statutory superannuation.
By remunerating senior executives through performance and long-term incentive plans in addition to their fixed
remuneration the Company aims to align the interests of senior executives with those of shareholders and increase Company
performance. Details of the remuneration, including both monetary and non-monetary components, for each of the
Executives during the year are included in the Directors’ Report.
The objective behind using this remuneration structure is to drive improved Company performance and thereby increase
shareholder value as well as aligning the interests of executives and shareholders.
The Board may use its discretion with respect to the payment of bonuses, stock options and other incentive payments.
2.2.4.2 Non-Executive Director Remuneration Policy
Non-Executive Directors are paid their fees out of the maximum aggregate amount approved by shareholders for the
remuneration of Non-Executive Directors. Non-Executive Directors do not receive performance based bonuses and do not
participate in equity schemes of the Company.
Non-Executive Directors are entitled to statutory superannuation.
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2.2.5
Current Director Remuneration
The aggregate amount of remuneration paid to Non-Executive Directors was approved by shareholders in 1996 and is
currently $150,000. Details of the remuneration received by all of the Company’s Directors are contained in the Directors’
Report.
2.3
Nomination Committee
2.3.1
Role
The role of a Nomination Committee is to help achieve a structured Board that adds value to the Company by ensuring an
appropriate mix of skills are present in Directors on the Board at all times.
As the whole Board only consists of five members, the Company does not have a nomination committee because it would
not be a more efficient mechanism than the full Board for focusing the Company on specific issues.
2.3.2
Responsibilities
The responsibilities of a Nomination Committee include devising criteria for Board membership, regularly reviewing the
need for various skills and experience on the Board and identifying specific individuals for nomination as Directors for
review by the Board. The Nomination Committee would also oversee management succession plans including the CEO and
his/her direct reports and evaluates the Board’s performance and makes recommendations for the appointment and removal
of Directors.
2.3.3
Criteria for selection of Directors
Directors are appointed based on the specific governance skills required by the Company. Given the size of the Company
and the business that it operates, the Company aims at all times to have at least one Director with experience in the
Company’s industry, appropriate to the Company’s market. In addition, Directors should have the relevant blend of
personal experience in:
(cid:131)
(cid:131)
accounting and financial management;
legal skills; and
(cid:131) CEO-level business experience.
3.
Company Code Of Conduct
As part of its commitment to recognising the legitimate interests of stakeholders, the Company has an established a Code of
Conduct to guide compliance with legal and other obligations to legitimate stakeholders. These stakeholders include
employees, clients, customers, government authorities, creditors and the community as whole. This Code includes the
following.
Responsibilities to Shareholders and the Financial Community Generally
The Company complies with the spirit as well as the letter of all laws and regulations that govern shareholders’ rights. The
Company has processes in place designed to ensure the truthful and factual presentation of the Company’s financial position
and prepares and maintains its accounts fairly and accurately in accordance with the generally accepted accounting and
financial reporting standards.
Responsibilities to Clients, Customers and Consumers
Each employee has an obligation to use their best efforts to deal in a fair and responsible manner with each of the
Company’s clients, customers and consumers. The Company for its part is committed to providing clients, customers and
consumers with fair value.
Employment Practices
The Company endeavours to provide a safe workplace in which there is equal opportunity for all employees at all levels of
the Company. The Company does not tolerate the offering or acceptance of bribes or the misuse of Company assets or
resources.
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Obligations Relative to Fair Trading and Dealing
The Company aims to conduct its business fairly and to compete ethically and in accordance with relevant competition
laws. The Company strives to deal fairly with the Company’s customers, suppliers, competitors and other employees and
encourages it employees to strive to do the same.
Responsibilities to the Community
As part of the community the Company:
(cid:131)
(cid:131)
(cid:131)
is committed to conducting its business in accordance with applicable environmental laws and regulations and
encourages all employees to have regard for the environment when carrying out their jobs;
encourages all employees to engage in activities beneficial to their local community; and
supports community charities.
Responsibility to the Individual
The Company is committed to keeping private information from employees, clients, customers, consumers and investors
confidential and protected from uses other than those for which it was provided.
Conflicts of Interest
Employees and Directors must avoid conflicts as well as the appearance of conflicts between personal interests and the
interests of the Company.
How the Company Complies with Legislation Affecting its Operations
Within Australia, the Company strives to comply with the spirit and the letter of all legislation affecting its operations.
Outside Australia, the Company will abide by local laws in all countries in which it operates. Where those laws are not as
stringent as the Company’s operating policies, particularly in relation to the environment, workplace practices, intellectual
property and the giving of “gifts”, Company policy will prevail.
How the Company Monitors and Ensures Compliance with its Code
The Board, management and all employees of the Company are committed to implementing this Code of Conduct and each
individual is accountable for such compliance. Disciplinary measures may be imposed for violating the Code.
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In respect of the financial year ended 30 June 2004, the Directors of Helix Resources Limited, (the parent entity), submit the
financial report. In order to comply with the provisions of the Corporations Act 2001, the Director’s report as follows:
DIRECTORS
The following persons held office as Directors of Helix Resources Limited during or since the end of the financial period:
Dr G. Michael Folie BE (Civil), DIC, MSc (Econ) PhD
Non-Executive Chairman
Appointed 16 April 2004
Dr Folie is currently Deputy Chairman of InterOil Corporation and Chairman of Regis Resources NL and the Institute of
Public Affairs. He was previously a senior executive with Shell Australia Limited and its subsidiaries from 1979 where he
was involved in all aspects of Shell’s Australian businesses, including investments in coal, alumina, gold, LNG, oil
refineries and chemical plants. From1990 to 1994 Dr Folie was a director of Shell Australia, and was the Executive Director
responsible for Billiton Australia activities (alumina, gold, base metals and exploration) and Shell Coal – the third largest
Australian producer. From 1994, he was the founding Managing Director and CEO of ASX listed gold explorer and
producer Acacia Resources Limited. Dr Folie was previously a director of the Export Finance and Insurance Corporation
("EFIC”), an arm of the Australian Federal Government from 1994 to 1997. Dr Folie has a PhD in Civil Engineering from
Southampton University and an MSc in Economics from the London School of Economics.
Robert W Mosig MSc, FAusIMM, FAICD
Managing Director – Executive Director
Appointed 1 July 1985
Mr Mosig is a Geologist with over 25 years experience in platinum group metals, gold and diamond exploration within
Australasia.
Anthony R Martin BSc (Hons), MAusIMM
Director Exploration – Executive Director
Appointed 20 July 1998
Mr Martin is a Geologist with over 15 years experience in the mining and exploration industry in Australia.
Ian K Macpherson BCom, CA
Non-Executive Director
Appointed 26 August 1985
Mr Macpherson is a Chartered Accountant with over 20 years experience in the resources, financial and corporate advisory
industries. He is a Director of Ord Group Pty Ltd, Chartered Accountants, a Non-Executive Chairman of Visiomed Limited
and Preston Resources Limited and Non-Executive Director of Navigator Resources Limited and Precious Metals Australia
Limited.
Bryce E Wauchope FCA, FAICD
Non-Executive Director
Appointed 10 March 1993
Mr Wauchope has had over 45 years experience in finance, banking, mining and industrial resources sectors.
Ewen W J Tyler
Appointed 23 January 1996, retired 16 April 2004
PRINCIPAL ACTIVITIES
The principal activity of the economic entity constituted by Helix Resources Limited and the entities it controlled during the
year consisted of platinum group metals (PGM), gold and mineral exploration. There has been no significant change in the
nature of these activities during the year.
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FINANCIAL RESULTS
The net consolidated profit (loss) of the economic entity for the financial period, after provision for income tax was
$(4,769,008),[2003: $(2,551,319)].
DIVIDENDS
No dividend has been paid since the end of the previous financial year and no dividend is recommended for the current
period.
REVIEW OF OPERATIONS
During the past 12 months the company has made significant advances in its effort to develop the Tunkillia Gold Project at
Lake Everard in the Gawler Craton of South Australia. By early 2004 the company had outlined a JORC resource of
730,000 oz of gold at 2.2g/t at the Area 223 prospect. A subsequent Scoping Study indicated that at a gold price of $550 per
ounce about 390,000 oz of this resource was minable at a grade of 2.4g/t by open cut methods. Based on these results the
company commenced the preliminary phase of a Feasibility Study, including further resource drilling and technical studies
into the mining at Area 223.
In March of 2004, the Company undertook a non-renounceable rights issue to raise approximately $4.74 Million for further
drilling and other activities aimed toward completing a Feasibility Study at the Tunkillia Project. The Issue was
undersubscribed and by the closing date only $1.37 Million was raised.
Due to a shortage of development funds the Scope of the Feasibility Study at Tunkillia was reviewed and the limited
amount of funds were utilised primarily for drilling and resource assessment.
During the year exploration at other projects was undertaken primarily by joint venture partners. The work included further
drilling at the Highway nickel laterite deposit by Heron Resources and extensive regional diamond exploration sampling by
DeBeers in the Munni Munni region. Negotiations were also commenced during the year to secure a joint venture partner
for the Loongana Ni, Cu and PGM prospect in the Nullarbor region of Western Australia.
In addition to its exploration portfolio the Company retains a strong resource base, as detailed below, across a selection of
commodities and is well positioned to continue to take advantage of future changes in commodity prices.
Resource Inventory
Project
Lake Everard
Munni Munni
Glenburgh
Fifield
Menzies
Commodity Equity
100%
100%
100%
100%
100%
40%
Au
PGM
Au
PGM
Ni Co
Ni Co
Grade and Tonnage
10.5Mt at 2.2g/t Au
24.0Mt at 2.9g/t PGM + Au
1.4Mt at 1.9g/t Au
10.2Mt at 0.6g/t Pt
2.0Mt at 0.18% Co & 0.35% Ni
6.0Mt at 1.4% Ni & 0.11% Co
Contained Metal
730,000 oz
2,240,000 oz
90,000 oz
200,000 oz
3,600t Co, 7,000t Ni
84,000t Ni, 6,600t Co
SIGNIFICANT CHANGES IN STATE OF AFFAIRS
In the opinion of the Directors, other than that disclosed elsewhere in this Report, there were no significant changes in the
state of affairs of the economic entity that occurred during the period under review.
SUBSEQUENT EVENTS
In August the Company suspended work on the Feasibility Studies on the Tunkillia Gold Project due to a shortage of funds.
The Project remains a valuable asset in the Company’s portfolio and ways of exploiting its value will be assessed by the
Company’s Board and Management.
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
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There has not been any other matter or circumstance, other than that referred to in the financial statements or notes thereto,
that has arisen since the end of the financial year, that has significantly affected, or may significantly affect, the operations
of the consolidated entity, the results of those operations, or the state of affairs of the consolidated entity in future financial
years.
FUTURE DEVELOPMENTS
The Company has decided that it will be implementing a new strategy of returning to a stronger exploration focus with
immediate effect. As a corollary of that decision a detailed review of costs and Board and Management structure is
underway.
Disclosure of any further information has not been included in this report because, in the reasonable opinion of the
Directors, to do so would be likely to prejudice the business activities of the economic entity.
DIRECTORS’ AND EXECUTIVES’ REMUNERATION
The Company’s Executive Officers’ remuneration policy is set to ensure that remuneration packages properly reflect the
duties and responsibilities of the senior executives and are sufficient to attract, retain and motivate personnel of the requisite
quality. The policy is administered by the Remuneration Committee, which is composed of Non-executive Directors.
Non-executive Directors are remunerated by fees determined by the Board within the aggregate Directors’ fee pool limit of
$150,000 approved by shareholders in April 1996. The pool limit is not at present fully utilised. In setting the fees, account
is taken of the responsibilities inherent in the stewardship of the Company and the demands made of Directors in the
discharge of their responsibilities. Advice is taken from independent consultancy sources to ensure remuneration accords
with market practice.
Remuneration packages contain the following key elements:
a) Primary benefits – salary / fees and performance bases bonuses;
b) Post employment benefits – prescribed retirement benefit;
c) Equity – share options granted under the executive share option plan as disclosed in note 26 to the financial
statements.
The following table discloses the remuneration of the directors and executives of the company:
2004
Salary &
Fees
Primary
Performance
Based
Payments
Post Employment
Non-
Monetary
Superan
nuation
Prescrib
ed
benefits
Other -
Retirement
Benefits
Equity
Options
$
$
$
$
$
$
$
Directors
E W J Tyler
Dr G M Folie
R W Mosig
A R Martin
I K Macpherson
B E Wauchope
Total
Executives
R E Vittino
Total
40,125
11,223
230,308
131,981
30,094
27,094
470,825
127,154
127,154
-
-
56,250
35,625
-
-
91,875
33,750
33,750
-
-
-
-
-
-
-
-
-
-
1,110
12,000
10,519
-
3,000
26,629
12,000
12,000
-
-
-
-
-
-
-
-
-
156,933
-
-
-
-
-
156,933
-
-
53,228
26,614
-
-
79,842
-
-
26,614
26,614
Other
benefits
$
-
-
-
-
-
-
-
-
-
Total
$
197,058
12,333
351,786
204,739
30,094
30,094
826,104
199,518
199,518
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DIRECTORS’ AND EXECUTIVES’ SHARE OPTIONS
In accordance with the provisions of the Employee Share Option Plan, executives and employees are entitled to subscribe
for ordinary shares on the terms agreed to by the Shareholders at a meeting held on 10 November 2003 in respect of the
2009 options. At the date of this report directors and executives are entitled to purchase an aggregate of 3,450,000 ordinary
shares of Helix Resources Limited according to the following terms:
Directors
and Executives
Number of
Executive
Options Held
Issuing Entity
Exercise
Price
Expiry Date
Number of ordinary
shares under option
Robert W Mosig
Anthony R Martin
Riccardo E Vittino
533,333
533,334
533,333
316,668
316,666
316,666
300,001
300,000
299,999
Helix Resources Limited
Helix Resources Limited
Helix Resources Limited
$0.42
$0.46
$0.50
29.03.2009
29.03.2009
29.03.2009
Helix Resources Limited
Helix Resources Limited
Helix Resources Limited
$0.42
$0.46
$0.50
29.03.2009
29.03.2009
29.03.2009
Helix Resources Limited
$0.42
29.03.2009
Helix Resources Limited
Helix Resources Limited
$0.46
$0.50
29.03.2009
29.03.2009
533,333
533,334
533,333
316,668
316,666
316,666
300,001
300,000
299,999
EXECUTIVE SHARE OPTION PLAN
2,200,000 Equity Options were issued to the Management Team comprising of Messrs R Mosig, A Martin and R Vittino
after shareholder approval was received at the Company’s 2003 Annual General Meeting. No options were exercised
during the financial year. The fair value attributed to the Equity Options in the disclosure of Directors and Executives’
remuneration has been calculated using the Black Scholes Model. No cash has been paid to the individuals. The value of
the Options would only be realised if and when the market price of Helix shares, as quoted by the Australian Stock
Exchange, rises above the Exercise Price of the options. Refer Notes 17 and 18.
DIRECTORS’ SHAREHOLDINGS
Director
R W Mosig
Dr G M Folie
A R Martin
I K Macpherson**
B E Wauchope**
*
**
*Fully Paid
Ordinary Shares
2,484,846
-
262,095
267,667
962,449
Listed Options
Staff Options
857,516
-
85,538
182,002
120,306
1,600,000
-
950,000
-
-
Directors’ interests in ordinary shares of the parent entity are shown at the date of this Directors’ Report.
Member of the Audit Committee
OFFICERS’ INDEMNITY AND INSURANCE
During the year the Company paid an insurance premium to insure the Directors and Officers of the Company and related
bodies corporate. The Officers of the Company covered by the insurance policy include the Directors named in this report.
The Directors’ and Officers’ Liability insurance provides cover against all costs and expenses that may be incurred in
defending civil or criminal proceedings that fall within the scope of the indemnity and that may be brought against the
officers in their capacity as officers of the Company or a related body corporate. The insurance policy does not contain
details of the premium paid in respect of individual officers of the Company. Disclosure of the nature of the liability cover
and the amount of the premium is subject to a confidentiality clause under the insurance policy.
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
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The Company has entered into an agreement with the Directors and Officers to indemnify them against any claim and
related expenses, which arise as a result of work completed in their respective capacities.
The Company has not otherwise, during or since the financial year indemnified or agreed to indemnify an officer or auditor
of the Company or of any related body corporate against a liability incurred as such an officer or auditor.
ENVIRONMENTAL REGULATIONS
The economic entity is subject to environmental regulations under laws of the Commonwealth and State. The economic
entity has a policy of complying with its environmental performance obligations and at the date of this report, is not aware
of any breach of such regulations.
MEETINGS OF DIRECTORS
The number of meetings held during the year by Company Directors (including meetings of committees of Directors) and
the number of those meetings attended by each Director was:
Board of Directors’
Meetings
Remuneration Committee
Meetings
Audit Committee
Meetings
Held*
Attended
Held*
Attended
Held
Attended
Dr G M Folie
E W J Tyler
R W Mosig
A R Martin
I K Macpherson
B E Wauchope
2
6
7
7
7
7
2
6
7
7
6
7
-
1
-
-
1
1
-
1
-
-
1
1
-
-
-
-
1
1
-
-
-
-
1
1
* Reflects the number of meetings held during the time that the Director held office during the year.
Dated at Perth this 30th day of September 2004.
This report is made and signed in accordance with a resolution of Directors made pursuant to s.298(2) of the Corporations
Act 2001.
On behalf of the Directors
Robert W Mosig
Managing Director
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
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H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
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H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
- 26 -
The Directors declare that:
a)
b)
c)
d)
The attached financial statements and notes thereto comply with Accounting Standards;
The attached financial statements and notes thereto give a true and fair view of the financial position and
performance of the Company and the consolidated entity;
In the Directors’ opinion, the attached financial statements and notes thereto are in accordance with the
Corporations Act 2001; and
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.
Signed in accordance with a resolution of the Directors made pursuant to s.295(5) of the Corporations Act 2001.
On behalf of the Directors
Robert W Mosig
Managing Director
Signed at Perth this 30th day of September 2004
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
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Current Assets
Cash assets
Receivables
Other
Note
2
3,4
5
CONSOLIDATED
COMPANY
2004
$
2003
$
2004
$
2003
$
1,634,457
156,058
56,536
2,377,662
1,022,506
53,422
1,634,455
156,058
56,536
2,377,660
1,022,506
53,422
Total Current Assets
1,847,051
3,453,590
1,847,049
3,453,588
Non-Current Assets
Other financial assets
Property, plant & equipment
Mineral interests
Other
Total Non-Current Assets
Total Assets
Current Liabilities
Payables
Provisions
Total Current Liabilities
Non Current Liabilities
Provisions
Total Non Current Liabilities
Total Liabilities
Net Assets
Equity
Contributed Equity
Reserves
Accumulated Losses
Total Equity
4
6
7
5
8
9
9
163,391
223,725
10,425,408
364,465
937,283
190,565
10,423,932
348,445
164,316
223,725
10,425,408
364,465
938,208
190,565
10,423,932
348,445
11,176,989
11,900,225
11,177,914
11,901,150
13,024,040
15,353,815
13,024,963
15,354,738
159,252
59,313
218,565
212,516
212,516
431,081
170,381
50,175
220,556
364,658
364,658
585,214
159,252
59,313
218,565
212,516
212,516
431,081
170,381
50,175
220,556
364,658
364,658
585,214
12,592,959
14,768,601
12,593,882
14,769,524
10
11
12
41,611,571
-
(29,018,612)
39,018,205
190,606
(24,440,210)
41,611,571
-
(29,017,689)
39,018,205
490,606
(24,739,287)
12,592,959
14,768,601
12,593,882
14,769,524
Notes to the financial statements are included on pages 30 to 52
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
- 28 -
Revenue from operating activities
Proceeds from sale of investments
Write down of investments
Depreciation
Exploration and evaluation
expenditure recoverable amount
adjustment
Legal Expenses and Professional
Services
Consultancy fees
Public Relations expenses
Travel and Accommodation
expenses
Rental expenses
Employee benefits expense
Directors’ Fees
Written Down Value of Investments
disposed
Other expenses from ordinary
activities
Loss Attributable to Members of the
Parent Entity
Income tax expense relating to
ordinary activities
Net Profit (Loss) /Total Changes in
Equity Other than those Resulting
from Transactions with Owners as
Owners
Earnings / (Loss) per share
Basic (cents per share)
Diluted (cents per share)
Note
13
13
12
19
21
21
CONSOLIDATED
COMPANY
2004
$
124,801
1,928,351
(111,000)
(51,270)
(4,533,390)
(141,015)
(126,275)
(74,438)
(139,391)
(47,217)
(557,874)
(112,646)
2003
$
257,060
1,759,507
(282,608)
(47,251)
(979,278)
(167,215)
(112,641)
(35,902)
(139,106)
(69,194)
(497,077)
(126,394)
2004
$
124,801
1,928,351
(111,000)
(37,682)
(4,533,390)
(141,015)
(126,275)
(74,438)
(139,391)
(47,217)
(557,874)
(112,646)
2003
$
257,060
1,759,507
(282,608)
(47,251)
(979,278)
(167,215)
(112,641)
(35,902)
(139,106)
(69,194)
(497,077)
(126,394)
(749,852)
(1,962,780)
(749,852)
(1,962,780)
(177,792)
(148,440)
(191,380)
(148,440)
(4,769,008)
(2,551,319)
(4,769,008)
(2,551,319)
-
-
-
-
(4,769,008)
(2,551,319)
(4,769,008)
(2,551,319)
(8.28)
(8.28)
(5.0)
(5.0)
Notes to the financial statements are included on pages 30 to 52
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
- 29 -
Not
e
2(b)
Cash Flow From Operating
Activities
Payments to suppliers and employees
Interest received
Other receipts
Net cash used in operating activities
Cash Flow From Investing Activities
Payments for capitalised exploration &
evaluation expenditure
Payment for property, plant &
equipment
Payments for shares – listed companies
Proceeds from sale of shares
Proceeds/(Payments) for security
deposits
Proceeds/(Payments) for bills of
exchange
Net cash provide by/(used in) investing
activities
Cash Flow From Financing Activities
Proceeds from issue of shares/options
Net cash provided by Financing
Activities
CONSOLIDATED
COMPANY
2004
$
2003
$
2004
$
2003
$
(1,662,717)
114,307
10,494
(1,537,916)
(1,546,309)
245,912
34,107
(1,266,290)
(1,662,717)
114,307
10,494
(1,537,916)
(1,546,309)
245,912
34,107
(1,266,290)
(4,252,865)
(2,307,557)
(4,252,865)
(2,307,557)
(85,896)
(9,041)
(85,896)
(9,041)
(86,130)
1,928,351
-
1,759,507
(86,130)
1,928,351
-
1,759,507
(16,020)
(14,478)
(16,020)
(14,478)
995,905
3,548,560
995,905
3,548,560
(1,516,655)
2,976,991
(1,516,655)
2,976,991
2,311,366
2,311,366
128,605
128,605
2,311,366
2,311,366
128,605
128,605
Net increase/(decrease) in cash held
(743,205)
1,839,306
(743,205)
1,839,306
Cash at beginning of financial year
2,377,662
538,356
2,377,660
538,354
Cash at End of Financial Year
2(a)
1,634,457
2,377,662
1,634,455
2,377,660
Notes to the financial statements are included on pages 30 to 52
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
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1.
SUMMARY OF ACCOUNTING POLICIES
Financial Reporting Framework
The financial report is a general-purpose financial report that has been prepared in accordance with the Corporations
Act 2001, applicable Accounting Standards and Urgent Issues Group Consensus Views, and complies with other
requirements of the law.
The financial report has been prepared on the basis of historical cost and except where stated, does not take into
account changing money values or current valuations of non-current valuations of non-current assets. Cost is based on
the fair values of the consideration given in exchange for assets.
Significant Accounting Policies
Accounting policies are selected and applied in a manner, which ensure that the resulting financial information
satisfied the concepts of relevance and reliability, thereby ensuring that the substance of the underlying transactions or
other events is reported.
The following significant accounting policies have been adopted in the preparation and presentation of the financial
report.
a) Going Concern
The Directors have prepared the financial statements on a going concern basis, which contemplates continuity of
normal business activities and the realisation of assets and extinguishment of liabilities in the ordinary course of
business.
The Company is required to raise additional capital in order to fund its planned exploration program and to
commercialise its tenement assets. The Company manages its exploration, development and overhead expenditures in
line with the funding available to the Company.
The Directors believe the going concern basis of accounting is appropriate as the Company has a successful track
record in raising capital and believe they will be able to obtain further funding to commercialise the tenement assets in
the form currently envisaged.
b) Principles of Consolidation
The consolidated financial statements are prepared by combining the financial statements of all the entities that
comprise the economic entity, being the Company (the parent entity) and its controlled entities as defined in
accounting standard AASB 1024 “Consolidated Accounts”. A list of controlled entities appears in note 4 to the
financial statements. Consistent accounting policies are employed in the preparation and presentation of the
consolidated financial statements.
The consolidated financial statements include the information and results of each controlled entity from the date on
which the Company obtains control and until such time as the Company ceases to control such entity.
In preparing the consolidated financial statements, all intercompany balances and transactions, and unrealised profits
arising within the economic entity are eliminated in full.
c)
Income Tax
Tax-effect accounting principles are adopted whereby the income tax expense shown in the statement of financial
performance is based on the pre-tax accounting profit adjusted for any permanent differences. Timing differences,
which arise due to the different accounting periods in which items of revenue and expense are included in the
determination of pre-tax accounting profit and taxable income, are brought to account as either a provision for deferred
income tax, or an asset described as future income tax benefit at the rate of income tax applicable to the period in
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
- 31 -
which the benefit will be received, or the liability will become payable. The net future income tax benefit relating to
tax losses and timing differences is not carried forward as an asset unless the benefit is virtually certain of being
realised.
d) Property, Plant and Equipment
Property, plant and equipment is stated at cost and is depreciated at rates based upon their expected useful lives to the
economic entity. The carrying amount of property, plant and equipment is reviewed annually by Directors to ensure it
is not in excess of the recoverable amount from these assets. Expected net cash flows have not been discounted in
determining recoverable amount. The depreciation rates used for each class of depreciable assets are:
Plant and equipment
Motor Vehicles
Straight line
Diminishing value
Diminishing value
10% - 33%
20% - 40%
22.5%
e) Exploration, Evaluation and Development Expenditure
Exploration, evaluation and development expenditure incurred is accumulated in respect of each identifiable area of
interest. These costs are only carried forward to the extent that they are expected to be recouped through the successful
development of the area, or where activities in the area have not yet reached a stage, which permits reasonable
assessment of the existence of economically recoverable reserves. When production commences, the accumulated
costs for the relevant area of interest are amortised over the life of the area according to the rate of depletion of the
economically recoverable reserves. Any costs of site restoration are provided for during the relevant production stages
and included in the costs of that stage. A regular review is undertaken of each area of interest to determine the
appropriateness of continuing to carry forward costs in relation to that area of interest and costs are written down to the
extent they are not considered recoverable.
f) Leases
Lease payments for operating leases where substantially all the risks and benefits remain with the lessor are charged as
expenses in the periods in which they are incurred.
g)
Investments
Investments in controlled entities are held at cost. Other investments are valued at cost or recoverable amount. The
carrying amount of investments is reviewed annually by Directors to ensure it is not in excess of the recoverable
amount of these investments. The recoverable amount is assessed from the shares' current market value or the
underlying net assets in the particular entities. Expected net cash flows have not been discounted in determining
recoverable amounts.
h) Employee Benefits
Provision is made for benefits accruing to employees in respect of wages and salaries, annual leave and long service
leave when it is probable that settlement will be required and they are capable of being measured reliably.
Provision is made in respect of wages and salaries, annual leave and other employee benefits expected to be settled
within 12 months, are measured at their nominal values using the remuneration rate expected to apply at the time of
settlement.
Provision made in respect of long service leave which is not expected to be settled within 12 months is measured as
the present value of the estimated future cash outflows to be made by the consolidated entity in respect of services
provided by the employees up to reporting date.
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R
T 2 0 0 4
- 32 -
i) Interest in Joint Venture Operations
Interest in joint venture operations, where material, are brought to account by including in the respective
classifications, the economic entity's share of the individual assets employed and liabilities and expenses incurred.
Details of interests in joint ventures are shown at Note 23.
j) Revenue Recognition
Revenue from the disposal of assets is recognised when the economic entity has passed control of the goods or other
assets to the buyer.
k) Accounts Payable
Trade payables and other accounts payable are recognised when the economic entity becomes obliged to make future
payments resulting from the purchase of goods and services.
l) Receivables
Other receivables are recorded at amounts due less any provision for doubtful debts.
m) Goods and Services Tax
Revenues, expenses and assets are recognised net of the amount of goods and services tax GST), except:
i.
where the amount of GST incurred is not recoverable from the taxation authority, it is recognised as part of
the cost of acquisition of an asset or as part of an item of expense; or
for receivables and payables which are recognised inclusive of GST.
ii.
The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or
payables.
Cash flows are included in the 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.
n) Recoverable Amount of Non-Current Assets
Non-current assets are written down to recoverable amount where the carrying value of any non-current asset exceeds
recoverable amount. In determining the recoverable amount of non-current assets, the expected net cash flows have not
been discounted to their present value.
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
- 33 -
NOTES TO THE STATEMENT OF CASHFLOWS
2.
a) Reconciliation of Cash
For the purposes of the statement of cashflows, cash includes cash on hand and in banks, and investments in money market
instruments, net of outstanding bank overdrafts. Cash at the end of the financial year as shown in the statement of cash flows is
reconciled to the related items in the statement of financial position as follows:
CONSOLIDATED
COMPANY
Cash at Bank
Cash on Deposit
b) Reconciliation of loss from
ordinary activities after related
income tax to net cash flows from
operating activities
Loss from Ordinary Activities after
related income tax
Non-cash flows in Operating
Loss
Depreciation
Recoverable amount write-down of
exploration and evaluation
expenditure
Net movement from revaluation of
investments
(Profit)/loss on sale of investments
(Profit)/loss on sale of fixed assets
Inherited Assets
Changes in Net Assets and
Liabilities
(Increase)/Decrease in Assets
(Increase)/decrease in other
receivables
(Increase)/decrease in prepayments
Increase/(decrease) in Liabilities
Increase/(Decrease) in trade payables
Provisions employee entitlements
Net Cash from Operating Activities
2004
$
(2,145)
1,636,602
1,634,457
2003
2004
$
(48,794)
2,426,456
2,377,662
$
(2,147)
2003
$
(48,796)
1,636,602
1,634,455
2,426,456
2,377,660
(4,769,008)
(2,551,319)
(4,769,008)
(2,551,319)
51,270
47,251
51,270
47,251
4,533,390
(459,204)
(608,295)
1,467
-
979,278
4,533,390
282,608
(459,204)
203,292
(608,295)
17,375
(78,114)
1,467
-
979,278
282,608
203,292
17,375
(78,114)
(130,288)
-
(130,288)
-
(3,114)
(5,867)
(3,114)
(5,867)
(11,129)
(143,005)
(123,306)
(37,488)
(11,129)
(143,005)
(123,306)
(37,488)
(1,537,916)
(1,266,290)
(1,537,916)
(1,266,290)
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
- 34 -
c) Non-cash financing and investing activities
During the financial year, the consolidated entity acquired the remaining 49% interest of the Tunkillia Gold Project from
AngloGold Ltd. Terms of the acquisition comprised an issue of shares and options to the value of $282,000. This is a non-
cash financing and investing activity which is not reflected in the statement of cashflows.
3. RECEIVABLES
Current
Other
Total Current Receivables
4. OTHER FINANCIAL ASSETS
Current
Commercial Bills
Non-Current
Shares in unlisted companies – at
cost
Shares in controlled entities – at
cost (i)
Shares in companies listed on a
prescribed stock exchange – at
recoverable amount
Shares in companies listed on a
prescribed Stock Exchange at
market value
(i)
Shares in controlled entities
CONSOLIDATED
COMPANY
2004
$
2003
$
2004
$
2003
$
156,058
156,058
26,601
26,601
156,058
156,058
26,601
26,601
-
-
995,905
995,905
-
-
995,905
995,905
55,391
55,391
55,391
55,391
-
-
925
925
108,000
881,892
163,391
937,283
108,000
164,316
881,892
938,208
108,000
824,891
108,000
824,891
Name
Country of Incorporation
Hillview Mining NL
Helix Mining Investment P/L
Australia
Australia
5. OTHER ASSETS
Current
Prepayments
Total Other Assets
Non-Current
Security Deposits on Tenements
Total Other Assets
CONSOLIDATED
2003
$
2004
$
56,536
56,536
364,465
364,465
53,422
53,422
348,445
348,445
COMPANY
Percentage
Held
2004
100%
100%
2004
$
56,536
56,536
364,465
364,465
Percentage
Held
2003
100%
100%
2003
$
53,422
53,422
348,445
348,445
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
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6. PROPERTY, PLANT AND EQUIPMENT
Gross Carrying Amount
Balance at 30 June 2003
Additions
Disposals
Balance at 30 June 2004
Accumulated Depreciation
Balance at 30 June 2003
Disposals
Depreciation
Balance at 30 June 2004
Net Book Value
30 June 2003
30 June 2004
Gross Carrying Amount
Balance at 30 June 2003
Additions
Disposals
Balance at 30 June 2004
Accumulated Depreciation
Balance at 30 June 2003
Disposals
Depreciation
Balance at 30 June 2004
Net Book Value
30 June 2003
30 June 2004
CONSOLIDATED
Plant &
Equipment
$
Motor
Vehicles
$
348,511
85,897
(1,923)
432,485
189,752
(456)
44,516
233,812
158,759
198,673
50,024
-
-
50,024
18,218
-
6,754
24,972
31,806
25,052
COMPANY
Plant &
Equipment
Motor
Vehicles
348,511
85,897
(1,923)
432,485
189,752
(456)
44,516
233,812
158,759
198,673
50,024
-
-
50,024
18,218
-
6,754
24,972
31,806
25,052
Total
$
398,535
85,897
(1,923)
482,509
207,970
(456)
51,270
258,784
190,565
223,725
Total
398,535
85,897
(1,923)
482,509
207,970
(456)
51,270
258,784
190,565
223,725
Aggregate depreciation allocated, whether recognised as an expense or capitalised as part of the carrying amount of other assets during
the year.
Plant and Equipment
Motor Vehicles
CONSOLIDATED
COMPANY
2004
$
44,516
6,754
51,270
2003
$
40,125
8,575
48,700
2004
$
44,516
6,754
51,270
2003
$
40,125
8,575
48,700
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
- 36 -
7. EXPLORATION AND EVALUATION
EXPENDITURE
Balance at beginning of the financial year
Expenditure incurred during the year
Expenditure written off during the year
Balance at the end of the financial year
10,423,932
4,534,866
(4,533,390)
10,425,408
9,095,654
2,307,556
(979,278)
10,423,932
10,423,932
4,534,866
(4,533,390)
10,425,408
9,095,654
2,307,556
(979,278)
10,423,932
The Directors' assessment of recoverable amount was after: consideration of prevailing market conditions; previous
expenditure carried out on the tenements; and the potential for mineralisation based on both the entity's and independent
geological reports.
The ultimate value of these assets is dependent upon recoupment by commercial development or the sale of the whole, or
part, of the economic entity's interests in those areas for an amount at least equal to the carrying value. There may exist, on
the economic entity’s exploration properties, areas subject to claim under native title or containing sacred sites or sites of
significance to Aboriginal people. As a result, exploration properties or areas within the tenements may be subject to
exploration and mining restrictions.
8. CURRENT PAYABLES
Trade payables
9. PROVISIONS
Current
Provision for annual leave
Provision for long service leave
Non Current
Provision
Directors’ retirement
Provision for long service leave
for Non-Executive
10. CONTRIBUTED EQUITY
62,866,808 Fully Paid Ordinary
Shares (2003: 50,525,458)
16,437,863
(2003:12,860,310)
Listed
Options
Balance at end of financial
year
CONSOLIDATED
COMPANY
2004
$
2003
$
2004
$
2003
$
159,252
170,381
159,252
170,381
36,559
22,754
59,313
204,217
8,299
212,516
20,854
29,321
50,175
361,150
3,508
364,658
36,559
22,754
59,313
204,217
8,299
212,516
20,854
29,321
50,175
361,150
3,508
364,658
41,454,472
38,889,600
41,454,472
38,889,600
157,099
128,605
157,099
128,605
41,611,571
39,018,205
41,611,571
39,018,205
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
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2004
2003
No.
$
No.
$
Fully Paid Ordinary Shares
Balance at beginning of financial
year
50,525,458
38,889,600
50,525,458
38,889,600
Issue of shares to
Anglogold as part consideration
for purchase of Tunkillia
project
Shareholder Purchase Plan
Exercise of Options to Fully Paid
Shares
Share placement through Rights
Issues
1,250,000
5,162,500
250,000
826,000
424,681
112,830
5,504,169
1,376,042
-
-
-
-
-
-
-
-
Balance at end of financial year
62,866,808
41,454,472
50,525,458
38,889,600
Listed Options
Balance at beginning of financial
year
Issue of options to Anglogold as
part consideration for
purchase of Tunkillia project.
Options issue through Rights
Issue
Options conversion to Fully Paid
Shares
CONSOLIDATED
2004
COMPANY
2003
No.
$
No.
$
12,860,310
128,605
1,250,000
32,500
-
-
2,752,234
-
12,860,310
(424,681)
(4,006)
-
-
-
128,605
-
128,605
Balance at end of financial year
16,437,863
157,099
12,860,310
Fully paid ordinary shares carry one vote per share and carry the right to dividends.
Listed options carry no votes until converted to fully paid ordinary shares.
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
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11. RESERVES
Asset Revaluation Reserve
Balance at beginning of
financial year
to
Transfer
accumulated
losses balance of reserve
relating to assets sold
Balance at end of financial
year
CONSOLIDATED
COMPANY
2004
$
2003
$
2004
$
2003
$
190,606
258,106
490,606
558,106
(190,606)
(67,500)
(490,606)
(67,500)
0
190,606
0
490,606
The asset revaluation reserve arises on the revaluation of non-current assets. Where a revalued asset is sold that portion of
the asset revaluation reserve which relates that asset, and is effectively realised, is transferred to retained profits.
12. ACCUMULATED LOSSES
Balance at beginning of
financial year
Transfer
from
Asset
Revaluation Reserve
Net Loss attributable
to
members of the parent entity
Balance at end of financial
year
CONSOLIDATED
COMPANY
2004
$
2003
$
2004
$
2003
$
(24,440,210)
(21,888,891)
(24,739,287)
(22,187,968)
190,606
-
490,606
-
(4,769,008)
(2,551,319)
(4,769,008)
(2,551,319)
(29,018,612)
(24,440,210)
(29,017,689)
(24,739,287)
13.
Loss from ordinary activities before Income Tax includes the following items of revenue and expense:
LOSS FROM ORDINARY ACTIVITIES
a) Operating Revenue
Interest Revenue
Other
b) Non-Operating Revenue
Proceeds
Investments *
from
Sale
of
* Sale of listed securities in Diamond Ventures NL
CONSOLIDATED
COMPANY
2004
$
114,307
10,494
124,801
2003
$
222,953
34,107
257,060
2004
$
114,307
10,494
124,801
2003
$
222,953
34,107
257,060
1,928,351
2,053,152
1,759,507
2,016,567
1,928,351
2,053,152
1,759,507
2,016,567
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
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c) Expenses:
Depreciation of non-current
assets: Property, plant and
equipment
Net transfers to employee
entitlement provisions
Write Off of exploration and
evaluation expenditure
Operating lease rental expenses:
Minimum lease payments
51,270
47,251
51,270
47,251
(143,004)
(37,488)
(143,004)
(37,488)
4,533,390
979,278
4,533,390
979,278
47,217
69,194
47,217
69,194
14.
Sales of assets in the ordinary course of business have given rise to the following profits / (losses):
SALE OF ASSETS
NET PROFITS / LOSSES
Property, plant and equipment
Investments
15.
a)
COMMITMENTS
Operating Lease Commitments
Not later than 1 year
Later than 1 year but not later
than 2 years
Later than 2 years but not later
than 5 years
(1,467)
1,178,499
(17,375)
(203,292)
(1,467)
1,178,499
(17,375)
(203,292)
1,177,032
(220,667)
1,177,032
(220,667)
129,420
129,420
129,420
129,420
64,710
129,420
64,710
129,420
-
194,130
66,710
325,550
-
194,130
66,710
325,550
The term of the Operating Lease in existence over the Company’s head office was for an initial period of six years. As at
balance date there was a balance of one and a half years remaining.
b) Exploration Expenditure
The economic entity has certain statutory obligations to perform minimum exploration work on its tenements to the value of
$2,143,686 (2003: $4,241,920) in the next twelve months. These obligations may be varied from time to time, subject to
approval, and are expected to be fulfilled in the normal course of operations of the economic entity.
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
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16.
DIRECTORS AND EXECUTIVES’ REMUNERATION
The specified Directors of Helix Resources Limited during the year were:
•
E W J Tyler (Chairman), retired 16.4.04
• Dr G M Folie (Chairman), appointed 16.4.04
• R W Mosig (Managing Director)
• A R Martin (Executive)
•
I K Macpherson (Non-executive)
• B E Wauchope (Non-executive)
The specified Executives of Helix Resources Limited during the year were:
• R E Vittino (Company Secretary and Chief Financial Officer)
The Company’s Executive Officers’ remuneration policy is set to ensure that remuneration packages properly reflect the
duties and responsibilities of the senior executives and are sufficient to attract, retain and motivate personnel of the requisite
quality. The policy is administered by the Remuneration Committee, which is composed of Non-executive Directors.
Remuneration packages are reviewed and determined with due regard to current market rates and are benchmarked against
comparable industry salaries, adjusted by a performance factor to reflect changes in the performance of the company. The
Executive Officers of the Company are employed under Service Agreements which have been in existence since May 1997.
The Service Agreements are all identical in their contents and only differ in remuneration levels. They have a duration of
twelve months and renew automatically unless terminated by either the Company by giving twelve months notice to the
individual; or by the individual by giving six months notice to the Company.
Non-executive Directors are remunerated by fees determined by the Board within the aggregate Directors’ fee pool limit of
$150,000 approved by shareholders in April 1996. The pool limit is not at present fully utilised. In setting the fees, account
is taken of the responsibilities inherent in the stewardship of the Company and the demands made of Directors in the
discharge of their responsibilities. Advice is taken from independent consultancy sources to ensure remuneration accords
with market practice.
Post Employment
2004
Directors
E W J Tyler
Dr G M Folie
R W Mosig
A R Martin
I K Macpherson
B E Wauchope
Total
Executives
R E Vittino
Total
Primary
Performance
Based
Payments
$
-
-
(iii)56,250
(iii)35,625
-
-
91,875
Salary &
Fees
$
40,125
11,223
230,308
131,981
30,094
27,094
470,825
127,154
127,154
(iii)33,750
33,750
Non-
Monetary
$
Superann
uation
Prescribed
benefits
$
$
-
-
-
-
-
-
-
-
-
-
1,110
12,000
10,519
-
3,000
26,629
12,000
12,000
-
-
-
-
-
-
-
-
-
Other -
Retirement
benefits
$
(i)156,933
-
-
-
-
-
156,933
Equity
Options
$
-
-
(ii)53,228
(ii)26,614
-
-
79,842
-
-
(ii)26,614
26,614
Other
benefits
$
-
-
-
-
-
-
-
-
-
Total
$
197,058
12,333
351,786
204,739
30,094
30,094
826,104
199,518
199,518
(i) Mr E W J Tyler received an Eligible Termination Payment of $156,933 upon his retirement on 16.4.04.
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
- 41 -
(ii) Equity Options were issued to the Management Team comprising of Messrs R Mosig, A Martin and R Vittino after
shareholder approval was received at the Company’s 2003 Annual General Meeting. The value attributed to the Equity
Option has been calculated using the Black Scholes Model. No cash has been paid to the individuals. The value of the
Options will only be realised if and when the market price of Helix shares, as quoted by the Australian Stock Exchange,
rises above the Exercise Price of the options. Further details of the options are contained in note 17 to the financial
statements.
(iii) Messrs R Mosig, A Martin and R Vittino were granted a performance based payment during the year. The payments
were made in recognition for achievements during the year and were not related to specific targets being met or formed part
of employment contracts. Details of the payments are listed below:
• Granted on 16 April 2004;
• The payments were cash and taxed accordingly; and
• The service and performance criteria used to determine the amount of the payments was reviewed by the
remuneration committee of the Company and included the acquisition of remaining 50% interest in Gawler
Craton JV from AngloGold for $1.5 million; the completion of a Scoping Study on Area 223 with the results
showing an undiscounted pre-tax cash surplus of over $62 million before capital costs at an AUD$550 gold
price; as well as Corporate achievements.
17. EXECUTIVE SHARE OPTION PLAN
As at 30 June 2004 the Company had issued 3,450,000 share options (30 June 2003 3,450,000). Share options carry no
rights to dividends and no voting rights. The difference between the total market value of options issued during the financial
year, at the date of issue, and the total amount received from executives and employees is not recognised in the financial
statements except for the purposes of determining directors’ and executives’ remuneration in respect of that financial year.
The amounts are disclosed in remuneration in respect of the financial year in which the entitlement was earned.
:Further details are disclosed below
Executive Share Option Plan
Balance at beginning of financial year (i)
Cancelled during the financial year (ii)
Granted during the financial year (iii)
Exercised during the financial year (iv)
Balance at end of financial year (v)
(i) Balance at beginning of financial year
2004
2003
No.
3,450,000
(2,200,000)
2,200,000
-
3,450,000
No.
3,450,000
-
-
-
3,450,000
Options - Series
No.
Grant Date
Expiry Date
Exercise Price
Issued 26 May 1999
Issued 26 May 1999
Issued 26 May 1999
Issued 24 May 2001
Issued 24 May 2001
Issued 24 May 2001
416,665
416,667
416,668
733,335
733,333
733,332
3,450,000
26/5/99
26/5/99
26/5/99
24/5/01
24/5/01
24/5/01
29/3/09
29/3/09
29/3/09
14/5/05
14/5/05
14/5/05
$
$0.42
$0.46
$0.50
$0.80
$1.00
$1.20
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
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(ii) Cancelled during the financial year pursuant to shareholder approval at 2003 Annual General Meeting
Options - Series
No.
Grant Date
Expiry Date
Exercise Price
Issued 24 May 2001
Issued 24 May 2001
Issued 24 May 2001
733,335
733,333
733,332
2,200,000
24/5/01
24/5/01
24/5/01
14/5/05
14/5/05
14/5/05
$
$0.80
$1.00
$1.20
(iii) Granted during the financial year pursuant to shareholder approval at 2003 Annual General Meeting
Options - Series
No.
Grant Date
Expiry Date
Exercise Price
First Tranche - Issued
11 Nov 2003
Second Tranche -
Issued 11 Nov 2003
Third Tranche - Issued
11 Nov 2003
733,335
11/11/03
29/3/09
$0.42
733,333
11/11/03
29/3/09
733,332
2,200,000
11/11/03
29/3/09
$0.46
$0.50
Fair Value
Received
$
-
-
-
In accordance with the Notice of Annual General Meeting 2003, options issued during the year ended 30 June 2004 vest at
the following dates:
• First tranche of options issued at $0.42 vest immediately
• Second tranche of options issued at $0.46 vest 12 months from issue date
• Third tranche of options issued at $0.50 vest 24 months from issue date
(iv) Exercised during the financial year
There were no options exercised during the financial year.
Fair value of consideration received is measured as the nominal value of cash receipts on conversion. The fair value of
shares at the date of their issue is measured as the market value at close of trade on the date of their issue.
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
- 43 -
(v) Balance at end of the financial year
Options – Series
No.
Vested No. Unvested No.
Grant Date
Expiry Date
Exercise Price
Issued 26 May 1999
Issued 26 May 1999
Issued 26 May 1999
First Tranche - Issued
11 Nov 2003
Second Tranche -
Issued 11 Nov 2003
Third Tranche - Issued
11 Nov 2003
416,665
416,667
416,668
416,665
416,667
416,668
733,335
733,335
-
-
-
-
26/5/99
26/5/99
26/5/99
29/3/09
29/3/09
29/3/09
$
$0.42
$0.46
$0.50
11/11/03
29/3/09
$0.42
733,333
733,332
3,450,000
-
-
733,333
11/11/03
29/3/09
$0.46
733,332
11/11/03
29/3/09
$0.50
Employee share options carry no rights of dividends and no voting rights.
The options issued on 26 May 1999 which remain on issue at the end of the financial year ended 30 June 2004 are fully
vested.
In accordance with the terms of the executive share option plan, options may be exercised at any time from the date of the
vesting period to the date of their expiry.
The difference between the total market value of options issued during a financial year, at the date of issue, and the total
amount received from executives and employees is not recognised in the financial statements except for the purposes of
determining directors’ and executives’ remunerations in respect of that financial year as disclosed in note 19 to the financial
statements. The amounts disclosed in remuneration in respect of the financial years over which the entitlement was earned.
Consideration received on the exercised of executive options is recognised in contributed equity. During the financial year
no options were exercise, hence no amount was recognised in contributed equity arising from the exercise of executive
options (2003: $nil).
18. RELATED PARTY AND SPECIFIED EXECUTIVES’ DISCLOSURES
a) Other Transactions with Specified Directors
The loss from ordinary activities before income tax includes the following items of expenses that resulted from
transactions other than remuneration with specified directors or their personally-related entities. Transactions
between related parties are on normal commercial terms and conditions unless otherwise stated.
(i) During the year, Ord Partners provided professional services to the value of $13,089 (2003 $16,348) on normal
commercial terms and conditions (net of GST). Mr I K Macpherson, a Director, has significant influence in Ord
Partners.
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R
T 2 0 0 4
- 44 -
(ii)During the year, E W J Tyler & Associates provided professional services to the value of $21,000 (2003 $26,322)
on normal commercial terms and conditions (net of GST). Mr E W J Tyler, a Director, has significant influence in
E W J Tyler & Associates Pty Ltd.
The aggregate of (i) and (ii) of $34,089 have been recognised under Legal Expenses and Professional Services.
b) Specified Directors’ and Specified Executives’ Equity Holdings
Fully paid ordinary shares issued by Helix Resources Limited
Balance @
1/7/03
Granted as
remuneration
Received on
exercise of
options
Net other
change
Balance @
30/6/04
Balance held
nominally
No
No
No
No
No
No
Specified Directors
Dr G M Folie
R W Mosig
A R Martin
I K Macpherson
B E Wauchope
Specified
Executives
R E Vittino
Total
-
2,215,707
179,321
211,000
492,502
320,000
3,418,350
-
-
-
-
-
-
-
-
-
-
-
166,835
-
269,139
82,774
56,667
303,112
-
2,484,846
262,095
267,667
962,449
-
122,500
442,500
166,835
834,192
4,419,557
-
-
-
-
-
-
-
Listed Share Options issued by Helix Resources Limited
Bal @ 1/7/03
Exercised
Granted as
remuneration
No
No
No
Specified Directors
Dr G M Folie
R W Mosig
A R Martin
I K Macpherson
B E Wauchope
Specified
Executives
R E Vittino
Total
*Acquired on market
-
738,571
59,776
70,333
157,501
157,804
1,183,985
-
-
-
-
-
-
-
Other
change *
No
-
118,945
25,762
111,669
120,306
Bal @ 30/6/04
No
-
857,516
85,538
182,002
120,306
-
-
-
-
157,501
-
456,467
614,271
157,501
833,149
1,859,633
Balance held
nominally
No
-
-
-
-
-
-
-
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
- 45 -
Executive Share Options issued by Helix Resources Limited
Bal @
1/7/03
Granted as
remunerati
on
Exercised
Other
change *
Bal @
30/6/04
Bal
vested @
30/6/04
Vested
but not
exercise-
able
Vested and
exercisable
No
No
No
No
No
No
No
No
Options
vested
during
year
No
Specified
Directors
Dr G M Folie
R W Mosig
A R Martin
I K
Macpherson
B E
Wauchope
Specified
Executives
R E Vittino
-
1,600,000
950,000
-
1,100,000
550,000
-
-
-
-
900,000
550,000
Total
3,450,000
2,200,000
-
-
-
-
-
-
-
-
(1,100,000)
(550,000)
-
1,600,000
950,000
-
866,667
583,334
-
-
-
-
-
-
(550,000)
900,000
533,334
(2,200,000)
3,450,000
1,983,335
-
-
-
-
-
-
-
-
866,667
583,334
-
366,667
183,334
-
-
-
-
533,334
183,334
1,983,335
733,335
* Share options cancelled pursuant to shareholder approval at 2003 Annual General Meeting.
All executive share options issued to the directors during the financial year were made in accordance with the provisions of
the executive share option plan.
Each executive share option converts into 1 ordinary share of Helix Resources Limited on exercise. No amounts are paid or
payable by the recipient on receipt of the option.
During the financial year, no executive share options were exercised by specified directors and executives.
Mr R.W. Mosig, Mr A. R. Martin and Mr. R. E. Vittino were issued options on 11 November 2003. The fair value of the
options issued were as follows:
Mr R.W. Mosig 366,667 options @ 9.36c
366,667 options @ 8.84c
366,666 options @ 8.37c
Messrs A.R. Martin & R.E. Vittino 183,334 options @ 9.36c
183,334 options @ 8.84c
183,334 options @ 8.37c
Further details of the options granted during the year are contained in note 17 to the financial statements.
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
- 46 -
19. INCOME TAX
Loss before income tax
Income Tax Expense:
Income tax expense/(benefit) calculated
at 30%
(Increase)/Decrease in income tax
benefit due to:
- non-deductible expenses
Benefit of tax losses not brought to
account as an asset
Income tax expense attributable to
operating loss
CONSOLIDATED
2004
2003
COMPANY
2004
2003
(4,769,008)
(2,551,319)
(4,769,008)
(2,551,319)
(1,430,702)
(765,396)
(1,430,702)
(765,396)
71,884
38,977
71,884
38,977
1,358,818
726,419
1,358,818
726,419
-
-
-
-
As of 30 June 2004, the parent entity and its controlled entities have future income tax benefits not brought to account as
assets in relation to tax losses and timing differences of parent entity $9,996,914 (2003: $8,638,096), economic entity
$10,627,104 (2003: $9,268,286), available to offset against future year's taxable income. The benefit will only be obtained
if:
a)
the economic entity derives future assessable income of a nature and of an amount sufficient to enable the benefits
from the deductions for the losses to be realised;
the economic entity continues to comply with the conditions for deductibility imposed by the law; and
b)
c)
no changes in tax legislation adversely affect the companies in realising the benefit from the deductions for the losses.
Legislation to allow groups, comprising a parent entity and its Australian resident wholly-owned entities, to elect to
consolidate and be treated as a single entity for income tax purposes was substantively enacted on 21 October 2002. This
legislation, which includes both mandatory and elective elements, is applicable to the company.
At the date of this report the directors have not assessed the financial effect, if any, the legislation may have on the company
and the consolidated entity and, accordingly, the directors have not made a decision whether or not to elect to be taxed as a
single entity. The directors have considered the transitional provisions and believe there isn’t a significant effect on the
company by not adopting tax consolidation on 1 July 2003. The financial effect of the implementation of the tax
consolidation system on the economic entity has not been recognised in the financial statements.
20. SEGMENT INFORMATION
The economic entity operated predominantly in one geographical segment and one business, being platinum, gold and other
base metals exploration and development in Western Australia, South Australia and New South Wales.
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
- 47 -
21. EARNINGS PER SHARE
Basic loss per share
Diluted loss per share
Basic Loss per Share
COMPANY
2004
Cents Per share
2003
Cents per share
(8.28)
(8.28)
(5.0)
(5.0)
The earnings and weighted average number of ordinary shares used in the calculation of basic earnings per share are as
follows:
Earnings (a)
Weighted average number of ordinary shares (b)
2004
$’000
(4,769,008)
2004
No.
62,866,808
2003
$’000
(2,551,319)
2003
No.
50,525,458
(a) Earnings used in the calculation of basic earnings per share is net loss after tax of $4,769,008 (2003 : $2,551,319).
(b) The staff and listed options are considered to be potential ordinary shares and are therefore excluded from the weighted
average number of shares used in the calculation of basic earnings per share. Where dilutive, potential ordinary shares are
included in the calculation of diluted earnings per share (refer below).
Diluted Loss per Share
The earnings and weighted average number of ordinary and potential ordinary shares used in the calculation of diluted
earnings per share are as follows:
Earnings (a)
Weighted average number of ordinary shares and
potential ordinary shares (b)
2004
$’000
(4,769,008)
2003
$’000
(2,551,319)
12 months to 30
June 2004
No.
62,866,808
12 months to 30
June 2003
No.
50,525,458
(a) Earnings used in the calculation of diluted loss per share is net loss after tax of $4,769,008 (2003: $2,551,319).
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
- 48 -
(b) The following potential ordinary shares are not dilutive and are therefore excluded from the weighted average number of
ordinary shares and potential ordinary shares used in the calculation of diluted earnings per share:
Staff options
Listed options
22. SUBSEQUENT EVENTS
2004
No.
3,450,000
16,437,836
2003
No.
4,055,999
12,860,310
In August the Company suspended work on the Feasibility Studies on the Tunkillia Gold Project due to a shortage of
funds. The Project remains a valuable asset in the Company’s portfolio and ways of exploiting its value will be assessed
by the Company’s Board and Management.
There have been no other transactions or events that substantially affect the operations of the economic entity, the
results of those operations or the state of affairs of the economic entity in future financial years since year end.
23. INTEREST IN JOINT VENTURES
The parent entity has entered into the following unincorporated joint ventures:
Joint Venture Project
Menzies
Meekatharra Region
Loongana
Pilbara Diamonds
Percentage Interest
49% Diluting (Heron Resources Limited 51%)
90% contributing (J A Bunting & Associates Pty Ltd 10%) Gold
90% contributing (J A Bunting & Associates Pty Ltd 10%)
100% diluting (DeBeers Australia Exploration Limited)
Platinum Group Metals
Diamonds
Principal Exploration Activities
Nickel
The joint ventures are not separate legal entities but are contractual arrangements between the participants for sharing costs
and output and do not in themselves generate revenue and profit. Exploration expenditure is the only asset of the joint
ventures. The consolidated entities interest in exploration expenditure in the above mentioned joint ventures is included in
note 7 and at 30 June 2004 is $655,175 (2003 : $780,233).
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
- 49 -
FINANCIAL INSTRUMENTS
24.
a) Details of the significant accounting policies and methods adopted, including the criteria for recognition, the basis of
measurement and the basis on which revenues and expenses are recognised, in respect of each class of financial asset,
financial liability and equity instrument are disclosed in Note 1 to the financial statements.
b) The economic entity's exposure to interest rate risk and effective weighted average interest rate for classes of financial
assets is set out below:
Average
Interest
Rate
Fixed
Interest Rate
Floating Interest Rate Maturity
Less than 1 year More than 1
Year
$
$
2004
Financial Assets
Other Receivables
Investments
Cash at bank and on deposit
Security deposits
Financial Liabilities
Trade Payables
Employee Entitlements
Net Financial Assets
2003
Financial Assets
Other Receivables
Investments
Cash at bank and on deposit
Commercial bills
Security deposits
Financial Liabilities
Trade creditors
Employee Entitlements
5.25%
5.0%
-
-
4.2%
4.7%
4.5%
-
-
1,634,257
-
1,634,257
-
-
-
1,634,257
-
-
2,377,462
-
-
2,377,462
-
-
-
-
-
-
364,465
364,465
-
-
-
364,465
-
-
-
995,905
348,445
1,344,350
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Non
Interest
Bearing
$
156,058
163,391
200
-
319,649
159,252
271,829
431,081
(111,433)
26,601
937,283
200
-
-
964,084
170,381
414,833
585,214
Total
$
156,058
163,391
1,634,457
379,465
2,333,461
159,252
271,829
431,081
1,902,290
26,601
937,283
2,377,662
995,905
348,445
4,685,896
170,381
414,833
585,214
Other than those classes of assets and liabilities denoted as "listed" in note 4, none of the classes of financial assets and
liabilities are readily traded on organised markets in standardised form.
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
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c) Credit Risk
Credit Risk refers to the risk that counterparty will default on, its contractual obligations resulting in financial loss to the
economic entity. The economic entity has adopted the policy of only dealing with credit worthy counterparties and
obtaining sufficient collateral or other security where appropriate, as a means of mitigating the risk of financial loss from
defaults. The economic entity measures risk on a fair value basis.
The maximum credit risk on financial assets of the economic entity which have been recognised on the statement of
financial position, other than investments in shares, is generally the carrying amount, net of any provisions for doubtful
debts.
d) Net Fair Value of Financial Assets and Liabilities
On-balance Sheet
The net fair value of cash and cash equivalents and non-interest bearing monetary financial assets and financial liabilities
approximates their carrying value.
The net fair value of financial assets and financial liabilities is based upon market prices where a market exists or by
discounting the expected future cash flows by the current interest rates for assets and liabilities with similar risk profiles.
Listed equity investments have been valued by reference to market prices prevailing at balance date. The market value of
listed equity investments has been disclosed in Note 4 to the financial statements. For unlisted equity investments, the net
fair value is an assessment by the Directors based on the underlying net assets, future maintainable earnings and any special
circumstances pertaining to a particular investment.
25. EMPLOYEE ENTITLEMENTS
CONSOLIDATED
COMPANY
2003
$
50,175
364,658
414,833
No
11
2004
$
The aggregate employee entitlement liability recognised and included in the financial statements is as follows:
2003
$
2004
$
Provision for employee
entitlements:
Current (Note 9)
Non-Current (Note 9)
Number of employees at end
of financial year
59,313
212,516
271,829
No
9
50,175
364,658
414,833
No
11
59,313
212,516
271,829
No
9
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
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26. REMUNERATION OF AUDITORS
a) Auditor of the Parent
Entity
Auditing the financial report
Other services
2004
$
2003
$
2004
$
2003
$
30,000
19,000
49,000
26,320
38,000
64,320
30,000
19,000
49,000
26,320
38,000
64,320
27. Impacts of adopting the Australian equivalents to International Financial Reporting Standards
The Australian Accounting Standards Board (AASB) has issued Australian equivalents to IFRS for application to
reporting periods beginning on or after 1 January 2005. Helix Resources Limited has commenced reviewing the
transition from its current policies to the AASB equivalents to IFRS. The Company has allocated internal resources and
engaged expert consultants to review, identify and conduct business impact assessments to isolate key areas that will be
affected by this transition. The Company’s audit committee is being regularly kept up to date with the results of both the
internal review and the external consultants reports and assessments. The adoption of the AASB equivalents to IFRS
will be first reflected in the Group’s financial statements for the half-year ending 31 December 2005 and the year ending
30 June 2006. At this stage the Company has not been able to reliably quantify the impacts on the financial statements.
Under AASB1 the Consolidated Entity, in complying with Australian equivalents to IFRS for the first time is required to
restate its comparative financial statements to amounts reflecting the application of Australian equivalents to IFRS to
that comparative period. Most adjustments required on transition to Australian equivalents to IFRS will be made,
retrospectively, against opening retained earnings as at 1 July 2004.
Key areas where accounting policies are likely to change and may impact on the financial statements of the Consolidated
Entity include the following:
(a) Capitalisation of Exploration and Evaluation Costs
The Consolidated Entity currently uses the “area of interest” principles which are used commonly in Australia and in
accordance with the Australian Accounting Standard AASB 1022 “Accounting for the Extractive Industries”. The
International Accounting Standards Board (IASB) is yet to determine the appropriate accounting treatment of
exploration and evaluation costs and therefore the Consolidated Entity is not able to come to any conclusions on how the
IFRS may affect its financial statements. However, the IASB has released Exposure Draft (ED) 6 Exploration and
Evaluation of Mineral Resources.
At the time of this report the IASB was in the process of re-deliberating its requirements. It appears that an ‘interim’
IFRS standard will effectively permit grandfathering of existing accounting treatments of exploration and evaluation
expenditure. Impairment tests may only be required when specific factors are met and where there is sufficient
information available to allow the determination of recoverable amount. A reliable estimation of the future financial
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R
T 2 0 0 4
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effects of any change to the Consolidated Entity’s financial statements is not possible until the IASB releases an IFRS
on accounting for exploration and evaluation costs.
(b) Income Tax
In accordance with Australian Standard AASB 112 Income Taxes, deferred tax balances are determined using the
balance sheet method which calculates temporary differences based on the carrying amounts of the Consolidated
Entity’s assets and liabilities in the statement of financial position and their associated tax bases. This represents a
fundamental change to the way the Consolidated Entity currently calculates its tax balances, where deferred tax
balances are determined using the income statement method. The consolidated entity has carried forward tax losses
which have not been recognised as deferred tax assets as they do not satisfy the ‘virtually certain’ criteria under current
Australian GAAP. Under A-IFRS it may be easier to recognise these tax losses as deferred tax assets as they recognised
based on a ‘probable’ recognition criteria. The likely impact of these changes on deferred tax balances has not currently
been determined.
(c) Provision for Rehabilitation and Restoration
In accordance with Australian Standard AASB 137 Provisions, Contingent Liabilities and Contingent Assets, the
Consolidated Entity will be required to fully provide, based on discounted future cash flows, for rehabilitation and
restoration where there is a legal or constructive obligation. A corresponding asset, net of depreciation to the date of
transition will be recognised and be depreciated together with development assets. The Consolidated Entity will be
required to recognise the unwinding of the discount in relation to the provision applied directly as an interest expense.
(d) Share Based Payments
Under Australian Standard AASB 2 Share-based Payment, the Consolidated Entity will be required to determine the fair
value of options issued to employees and recognise an expense in the Statement of Financial Performance. For options
on issue on the application of AASB 2 an adjustment for their recognition will be made against opening retained
earnings. Reliable estimation of the future financial effects of this change in accounting policy is impracticable as the
details of future equity based remuneration plans are unknown; however where share based payments are made, net
profit is expected to decrease by the fair value of such payments.
The above should not be regarded as a complete list of changes in accounting policies that will result from the transition
to AASB equivalents to IFRS. As noted above these are expected to be the material areas of impact for the Consolidated
Entity that have been identified.
28. ADDITIONAL COMPANY INFORMATION
Helix Resources Limited is a listed public company, incorporated and operating in Australia.
Registered Office Principal Place of Business
Level 3, 24 Kings Park Road Level 3, 24 Kings Park Road
WEST PERTH WA 6005 WEST PERTH WA 6005
Tel (08) 9321 2644 Tel (08) 9321 2644
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
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NUMBER OF SHARES HELD
Spread of Holdings
1–1000
1,001–5,000
5,001–10,000
10,001–100,000
100,001and over
Total
Number of
Shareholders
Number of Shares
606
911
462
721
85
2,785
358,394
2,593,444
3,871,174
23,208,895
32,834,901
62,866,808
Number of shareholders holding
less than a marketable parcel
1,098
1,266,886
PERCENTAGE HELD BY 20 LARGEST SHAREHOLDERS
1
2
3
4
5.
6.
7.
8.
Shareholder
Yandal Investments Pty Ltd
National Nominees Limited
Invia Custodian Pty Ltd
Colter Holdings Group
Cairnglen Investments Pty Ltd
AngloGold Australia Limited
ANZ Nominees Limited
Niddrie Holdings Pty Limited
(Wauchope Super Fund A/C)
Zero Nominees Pty Ltd
9.
10. Arcaro Holdings Pty Ltd
11. Mr. Maxwell Alfred Kippe
12. Blamco Trading Pty Ltd
13. Ms. Seiko Furuse & Mr. Savas Turem
14. Berne No 132 Nominees Pty Ltd
15. Mr. Abdelaziz Soliman
16. Mr. John Halaska
17. Mr. Philip Broadley
Technica Pty Ltd
18.
19.
Equities Trustees Limited
20. Yan’s Investments Pty Ltd
Top 20 Total
Shares
%
4,000,000
3,083,158
2,928,362
2,483,846
2,086,178
1,666,667
1,097,448
831,893
696,906
653,880
600,000
525,341
500,000
466,667
440,000
379,622
374,335
364,757
321,250
303,650
23,785,960
6.36
4.90
4.66
3.95
3.32
2.65
1.72
1.32
1.11
1.04
0.95
0.84
0.80
0.74
0.70
0.60
0.59
0.58
0.51
0.48
37.82
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
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VOTING RIGHTS
One vote for each ordinary share held in accordance with the Company's Constitution.
SUBSTANTIAL SHAREHOLDERS
Shareholder
Cairnglen Investments Pty Ltd
Yandel Investments Pty Ltd
DIRECTORS' INTEREST IN SHARE CAPITAL
Disclosed elsewhere in this report.
NUMBER OF OPTIONS HELD
Shares
% of
Issued Capital
5,000,290
4,000,000
7.95
6.36
1–1000
1,001–5,000
5,001–10,000
10,001–100,000
100,001and over
TOTAL
Spread of Holdings
Number of Option
Holders
Number of Options
237
281
112
186
33
848
111,703
744,039
840,646
5,921,972
8,819,503
16,437,863
PERCENTAGE HELD BY 20 LARGEST OPTIONHOLDERS
Optionholder
Shares
%
AngloGold Australia Limited
Invia Custodian Pty Ltd
Colter Holdings Group
Zero Nominees Pty Ltd
Cairnglen Investments Pty Ltd
Mr. Abdelaziz Soliman
Yandal Investments Pty Ltd
Mr. John Halaska
Mr. Andrew Bruce Doak
1.
2.
3.
4.
5.
6.
7.
8.
9.
10, Mrs. Clare Mary Sung-Reid
11.
12. Mr. David Gordon Miller & Ms. Jennifer
ANZ Nominees Limited
Louise Miller &
Reynolds (Nominees) Pty Ltd
13.
14. Mr. Neil John Strong
15.
Lawrence Crow Consulting Pty Ltd
Technica Pty Ltd
Tromso Pty Ltd
16. Mr. Michael Betts
17.
18.
19. Mrs. Ada Maureen Lourey
20. Mr. Raymond Paul Sandle
160,000
135,000
134,703
125,209
120,209
120,000
7,929,245
The above listed options are due to expire on 30 November 2005 and are exercisable at $0.25 each.
Top 20 Total
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
1,458,334
1,082,376
857,182
599,800
594,818
480,000
411,470
330,417
300,000
250,000
232,927
200,000
171,800
165,000
8.87
6.58
5.21
3.65
3.62
2.92
2.50
2.01
1.82
1.52
1.42
1.22
1.05
1.00
0.97
0.82
0.82
0.76
0.73
0.73
48.22
- 55 -
Tenement Type and Number Name
Mineral
Ownership
WESTERN AUSTRALIA
EL09/644*
MLA09/87
MLA09/88
ELA09/1079
PLA09/424
PLA09/425
PLA09/426
PLA09/427
EL29/139*
ML29/214
EL29/139*
MLA29/171
MLA29/173
MLA29/215
MLA29/216
MLA29/217
MLA29/218
MLA29/219
MLA29/220
MLA29/226
MLA29/227
EL77/1029
EL77/1030
EL77/1031
EL77/1154
EL77/1042
EL77/1043
ML47/123
ML47/124
ML47/125
ML47/126
ML47/141
ML47/142
ML47/143
ML47/144
MLA47/569
ELA47/1089
ELA47/1090
EL47/905
EL47/1015
EL47/1074
EL47/1075
MLA47/570
MLA47/571
Glenburgh
Glenburgh
Glenburgh
Glenburgh
Glenburgh
Glenburgh
Glenburgh
Glenburgh
Menzies
Menzies
Menzies
Menzies
Menzies
Menzies
Menzies
Menzies
Menzies
Menzies
Menzies
Menzies
Menzies
Barlee
Barlee
Barlee
Barlee
Barlee
Barlee
Munni Munni
Munni Munni
Munni Munni
Munni Munni
Munni Munni
Munni Munni
Munni Munni
Munni Munni
Munni Munni
Munni Munni South
Munni Munni South
Munni Munni South
Munni Munni South
Munni Munni South
Munni Munni South
Munni Munni South
Munni Munni South
Gold
Gold
Gold
Gold
Gold
Gold
Gold
Gold
Nickel
Nickel
Gold
Gold
Gold
Gold
Gold
Gold
Gold
Gold
Gold
Gold
Gold
Gold
Gold
Gold
Gold
Gold
Gold
PGM
PGM
PGM
PGM
PGM
PGM
PGM
PGM
PGM
PGM
Diamonds
Diamonds
Diamonds
Diamonds
Diamonds
Diamonds
Diamonds
Helix Resources Limited 100%
*Conversion from EL to MLs
Helix Resources Limited 100%
Menzies Nickel Joint Venture
(Heron Resources NL 51%, Helix 49%)
Helix Resources Limited 100%
Helix Resources Limited 100%
Comet Resources NL Joint Venture
(Helix 82.5%)
Helix Resources Limited 100%
West Pilbara Joint Venture
Helix Resources Limited 100%
DeBeers Australia Exploration
Limited earning 51%
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4
- 56 -
Tenement Type and Number Name
Mineral
Ownership
WESTERN AUSTRALIA
MLA47/572
MLA47/573
MLA47/574
ELA47/1144
ELA47/1145
ELA47/1146
ELA47/1169
ELA47/1170
ELA47/1171
EL38/1000
ELA38/1476
EL51/946
EL52/1495
EL52/1496
EL69/1516
EL69/1517
EL69/1718
EL69/1719
EL69/1720
PL69/34
PL69/35
PL69/36
PL69/37
EL38/1477
EL38/1478
ELA52/1623
ELA52/1624
ELA52/1625
ELA52/1626
Munni Munni South
Munni Munni South
Munni Munni South
Elvire
Elvire
Elvire
Yalleen
Yalleen
Yalleen
Mt Venn
Diamonds
Diamonds
Diamonds
Diamonds
Diamonds
Diamonds
Diamonds
Diamonds
Diamonds
PGM, Nickel
Mt Venn East
Narracoota
Narracoota
Narracoota
Loongana
Loongana
Loongana
Loongana
Loongana
Loongana
Loongana
Loongana
Loongana
Isolated Hill
Isolated Hill
Perry Creek
Perry Creek
Perry Creek
Perry Creek
PGM, Nickel
Gold
Gold
Gold
Gold, PGM, Base metals
Gold, PGM, Base metals
Gold, PGM, Base metals
Gold, PGM, Base metals
Gold, PGM, Base metals
Gold, PGM, Base metals
Gold, PGM, Base metals
Gold, PGM, Base metals
Gold, PGM, Base metals
Gold, PGM, Base metals
Gold, PGM, Base metals
Base metals
Base metals
Base metals
Base metals
SOUTH AUSTRALIA
EL2697
EL2854
ELA2004/180
Lake Everard
Lake Everard West
Childarra
Gold
Gold
Gold
Kelray Joint Venture
(Helix earning 80%)
Helix Resources Limited 100%
J A Bunting & Assoc Pty Ltd Joint
Venture ( Helix 90%)
J A Bunting & Assoc Pty Ltd
Joint Venture (Helix 90%)
Helix Resources Limited 100%
Helix Resources Limited 100%
Helix Resources Limited 100%
Abbreviations and Definitions used in Schedule:
EL
ML
PL
Exploration Licence
Mining Lease
Prospecting Licence
ELA
MLA
ALA
Exploration Licence Application
Mining Lease Application
Prospecting Licence Application
H E L I X R E S O U R C E S L I M I T E D A N N U A L R E P O R T 2 0 0 4