More annual reports from Horizon Minerals:
2023 ReportANNUAL REPORT
CONTENTS
CORPORATE PARTICULARS ...................................................................................................................................... 1
CHAIRMAN AND MANAGING DIRECTOR’S REVIEW ................................................................................................. 2
OPERATIONS REPORT ................................................................................................................................................ 3
DIRECTORS' REPORT ............................................................................................................................................... 24
AUDITOR’S INDEPENDENCE DECLARATION .......................................................................................................... 34
DIRECTORS’ DECLARATION ..................................................................................................................................... 35
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME ........................ 36
CONSOLIDATED STATEMENT OF FINANCIAL POSITION ....................................................................................... 37
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY ....................................................................................... 38
CONSOLIDATED STATEMENT OF CASH FLOWS .................................................................................................... 39
NOTES TO AND FORMING PART OF THE CONSOLIDATED FINANCIAL STATEMENTS ...................................... 40
INDEPENDENT AUDIT REPORT TO THE MEMBERS OF HORIZON MINERALS LIMITED ..................................... 67
SHAREHOLDER INFORMATION ................................................................................................................................ 71
About Horizon Minerals Limited
Horizon is an emerging mid-tier gold producer with high quality projects located in the heart of the West Australian
goldfields. The Company is led by a Board and Management team with deep experience developing and operating
successful gold mines within the Kalgoorlie region.
Horizon has a large tenement holding which hosts over a million ounces of gold in Resources and has significant open
cut and underground growth potential.
Corporate Governance
The Company has adopted the 3rd Edition of the ASX Corporate Governance Recommendations. A summary statement
which has been approved by the Board together with current policies and charters is available on the Company website
at the following address www.horizonminerals.com.au.
CORPORATE PARTICULARS
BOARD OF DIRECTORS
Chairman
Peter Bilbe
Managing Director
Jonathan Price
Non-Executive Director Ashok Parekh
Non-Executive Director Jeff Williams
CHIEF OPERATING OFFICER
Grant Haywood
COMPANY SECRETARY
Bianca Taveira
REGISTERED OFFICE AND PRINCIPAL PLACE OF BUSINESS
163-167 Stirling Highway
NEDLANDS WA 6009
Telephone 08 9386 9534
Email
info@horizonminerals.com.au
POSTAL ADDRESS
PO Box 1104
NEDLANDS WA 6909
SHARE REGISTRY
Computershare Investor Services Pty Ltd
Level 11
172 St Georges Terrace
PERTH WA 6000
Telephone 1300 787 272
AUDITORS
Rothsay Auditing
Level 1, Lincoln House
4 Ventnor Avenue
WEST PERTH WA 6005
Telephone 08 9486 7094
STOCK EXCHANGE LISTING
Australian Securities Exchange
Home Exchange: Perth
Code: HRZ (formerly IRC)
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 1
CHAIRMAN AND MANAGING DIRECTOR’S REVIEW
Dear Shareholder
The 2019 financial year has been one of significant growth for the Company and a year with improving sentiment and
commodity prices for the resources sector in general.
With continuing concerns around the global economy, trade wars and increased geopolitical tension, the safe haven of
gold has seen a marked increase in the US$ gold price and record A$ gold prices with the decrease in the Australian
dollar. Sentiment has improved across the sector with the larger producers reaching all time high share prices and
investment interest now turning to the emerging producers and quality explorers.
Locally, Western Australia and the goldfields region has had another exceptional year with the mid-tier producers
reporting continued record production, cash balances and performance metrics putting them well and truly on the world
stage. Whereas organic growth had been the focus in 2018, more corporate activity is now clearly evident with the larger
cashed up companies completing major acquisitions both domestically and overseas. The trend of the larger companies
entering joint ventures with smaller developers and explorers has also continued in what remains a challenging capital
market for juniors.
The Company has made significant progress during the year with the successful merger with MacPhersons Resources
Limited and a number of successful drilling campaigns across the portfolio. On the back of the merger, the Company has
re-branded itself to Horizon Minerals Limited with the goal of becoming the regions next gold producer. No capital raisings
were required during the year and the Company remains in a strong financial position to self-fund future organic growth.
A number of highly successful drilling campaigns totalling 37,356m were completed across the Company’s existing and
newly acquired tenure and our Resource position has grown 54% to 667,500 ounces. With the addition of the large scale
Boorara project 15km east of Kalgoorlie from the merger, Horizon’s Resource now totals over 1.2Moz.
Drilling was completed at the Anthill, Teal, Blister Dam, Olympia, Scotia and Windanya prospects with excellent results
culminating in both resource growth, new maiden resources and successful testing of high priority new regional targets.
This has enabled mine evaluation work to be completed as part of the consolidated Feasibility Study due in mid-2020
and provided a number of follow up targets for drilling in FY20.
The Company continued to work on the potential acquisition of the Coolgardie gold project after entering an Exclusivity
Deed with Focus Minerals in February 2019. A number of divestments were also completed including the sale of our
interest in Lehman’s to Saracen for A$2.5 million in cash and a royalty. Subsequent to year end, the Menzies and
Goongarrie gold projects were also divested for a total consideration of A$8 million.
Existing joint ventures with AXF Vanadium and Mithril Resources progressed during the year as did discussions with
new potential partners that can provide mutual benefit. The Joint Venture with AXF covering the world class 2.6Bt
Richmond Vanadium project has generated considerable excitement with the development of Vanadium redox flow
batteries and we look forward to AXF completing detailed metallurgical testwork to advance the project to
commercialisation.
We’d like to take the opportunity to thank all our Board members, staff, contractors and you, our shareholders, for your
support during the year. We would also like to acknowledge Peter Hunt’s retirement as a director, after providing
outstanding service to the company spanning a 30 year period, and wish him well in his future endeavours. A special
thank you and welcome to our new Board members Ashok Parekh and Jeff Williams and the MacPhersons team on site
at Boorara.
The Horizon team look forward to keeping you fully informed as the business grows in what will be another very exciting
year ahead.
JON PRICE
Managing Director
PETER BILBE
Chairman
27 September 2019, Perth, WA
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 2
OPERATIONS REPORT
CORPORATE
ISSUED CAPITAL
At 30 June 2019, Horizon Minerals Limited had 427,975,200 fully paid ordinary shares on issue.
COMPANY INVESTMENTS
At 30 June 2019, Horizon held 7,151,109 fully paid ordinary shares and 595,926 listed options exercisable at 24 cents
on or before 30 June 2021 (ASX: RWDOA) in Reward Minerals Ltd (ASX: RWD) valued at approximately $605,461.
At 30 June 2019, the Company had cash on hand of approximately $5.086M.
MERGER WITH MACPHERSONS RESOURCES LTD
As announced to the ASX on 11 and 14 December 2018, Horizon (formerly Intermin) and MacPhersons Resources Limited
(MacPhersons) (ASX: MRP) executed a Merger Implementation Agreement (MIA) to combine the two companies by way of
a Scheme of Arrangement, subject to MacPhersons shareholder and court approval.
This Scheme of Arrangement was approved by MacPhersons shareholders on 31 May 2019 and the Supreme Court of
Victoria on 6 June 2019, and was implemented on 14 June 2019.
As a result, MacPhersons is now a wholly owned subsidiary of Horizon (formerly Intermin), with the transaction enabling
the creation of a new emerging mid-tier gold production business named Horizon Minerals Limited (as approved by
Intermin shareholders on 24 July 2019) with a significant asset portfolio and an expedited pathway to production. The
consolidation of the baseload Boorara project (Figure 2), with approvals in place and the higher grade surrounding
projects within easy trucking distance provides the critical mass to underpin an expedited mine development and
production pathway.
In accordance with the Scheme, Horizon (formerly Intermin) has issued 192,586,736 fully paid ordinary shares (“shares”)
as consideration for the transfer of MacPhersons shares under the scheme to Horizon (formerly Intermin). Out of those
192,586,736 Horizon (formerly Intermin) shares issued, 2,754,384 were issued to the sale agent to sell on behalf of
ineligible foreign shareholders (refer to the Scheme Booklet released to the ASX by MacPhersons on 17 April 2019 for
further details). This process is now complete.
Normal trading of these new Horizon (formerly Intermin) shares commenced on Monday 17 June 2019.
Horizon (formerly Intermin) has also granted 2,743,184 unlisted options, each exercisable at $0.2912 on or before 9
December 2019 and 219,456 unlisted options, each exercisable at $0.6988 on or before 28 February 2020, in
consideration for the cancellation of all MacPhersons options that were on issue as at 14 June 2019.
Following the completion of the merger, Horizon (formerly Intermin) has commenced integration of the assets into a
consolidated Feasibility Study due for completion in the first half of 2020. As part of the Study, an updated independent
Mineral Resource estimate for Boorara is being compiled together with mine optimisation and design work to generate
Ore Reserves and an initial mine development and production plan.
POTENTIAL ACQUISITION OF THE COOLGARDIE GOLD PROJECT
As announced to the ASX on 11 February 2019, the Company entered into an Exclusivity Deed for the potential
acquisition of the Coolgardie gold project from Focus Minerals including the 1.2Mtpa Three Mile Hill processing plant
currently on care and maintenance. At year end, both companies continued to progress formal documentation and
required approvals and, as announced to the ASX on 2 July 2019, extended the exclusivity period by 3 months.
As the potential transaction remains subject to the negotiation of, and entry into, formal documentation and the receipt
of necessary approvals, there remains no assurance that the potential transaction will proceed. Neither Focus nor Horizon
is under any obligation to proceed with the potential transaction or to enter into the formal documentation unless they are
satisfied in all respects with the terms and conditions of the formal documentation.
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
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OPERATIONS REPORT
EXPLORATION AND DEVELOPMENT
OVERVIEW
The Company continued to advance and build up its gold project portfolio in Western Australia. In addition, the Company’s
joint venture partners were active across multiple earn in projects including the exciting Richmond vanadium project in
Queensland. This year, self-funded mine evaluation and exploration were the main focus as part of the consolidated
Feasibility Study post-merger and the regional drilling programs across the portfolio.
The locations of all WA projects are shown in Figure 1.
Figure 1
Horizon Minerals Ltd WA Projects 2019
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
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OPERATIONS REPORT
The Company operates 100% owned gold projects in the Kalgoorlie and Coolgardie Regions and has earn-in joint
ventures at the Nanadie Well copper-nickel project and the Richmond vanadium project located in Queensland. Over
37,350m of drilling was completed during the 2019 financial year.
New gold acquisitions to expand the Kalgoorlie and Coolgardie area portfolio included the Lakewood, Yarmany and
Boorara gold projects (Figure 2). Technical programs on these projects included data compilation, exploration targeting
and geological modelling. Key activities conducted during the year are outlined below.
Figure 2
Horizon Minerals Ltd Kalgoorlie Area Gold Projects Location Map
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OPERATIONS REPORT
TEAL GOLD PROJECT AREA
The Teal project area comprises the 100% owned Teal gold mine and Peyes Farm development project and the new
Jacques Find, Yolande and Wills Find discoveries. During the year, activities focussed on resource extension drilling and
new discovery drilling beyond existing resource envelopes.
TEAL GOLD PROJECT – MINING AND DEVELOPMENT
The Teal gold mine is located 12km northwest of Kalgoorlie in Western Australia (Figure 2). Mining commenced in
October 2016 and was completed in March 2018. Final ore processing was completed in June 2018 with mine site
rehabilitation and mine closure in July 2018 (Figure 3).
Figure 3
Horizon Minerals Ltd Waste dump rehabilitation and seeding at the Teal gold mine
TEAL GOLD PROJECT AREA – EXPLORATION
Horizon (formerly Intermin) undertook a comprehensive resource RC drill program in 2018 at Teal, Jacques Find, Peyes
Farm and Yolande. Drilling activities at Teal were concluded June 2018. In total 23,510m were drilled as part of the
planned 55,000m program. A final summary of results from the programs were announced to the ASX on 19 September
2018 and shown below:
10m @ 6.70g/t Au from 60m and 8m @ 5.70g/t Au from 64m
8m @ 5.28g/t Au from 64m and 6m @ 6.69g/t Au from 91m
3m @ 10.28g/t Au from 102m and 8m @ 10.31g/t Au from 123m
13m @ 2.78g/t Au from 90m and 11m @ 2.77g/t Au from 73m
6m @ 4.72g/t Au from 54m and 6m @ 4.34g/t Au from 42m
37m @ 2.16g/t Au from 90m and 9m @ 4.45g/t Au from 118m
7m @ 4.47g/t Au from 34m and 12m @ 2.33g/t Au from 105m
Subsequent to this, 555m of resource extension/new discovery drilling was then completed as part of the 11,000m 2019
campaign.
The drilling programs have been highly successful in extending mineralisation both along strike and at depth with four
parallel mineralised structures identified along a 2km strike zone. Mineralisation remains open in all directions with new
targets identified from a large scale auger program to the south. Reconnaissance drilling intercepted mineralisation to
both the east and west of the Teal open pit and will be followed up in FY20.
As announced to the ASX on 19 September 2018, the new data was used to compile a detailed independent Mineral
Resource Estimate which is compliant with the JORC 2012 Code.
The updated Mineral Resource Estimate for the Teal project area stands at 4.25Mt grading 2.11g/t Au for 289,000 ounces
(at a 1g/t Au lower cut-off grade) (see Table 1 and Competent Persons Statement on Page 13).
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
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OPERATIONS REPORT
Figure 4
Horizon Minerals Ltd Location Plan Teal-Jacques-Yolande drilling showing recent results
ANTHILL GOLD PROJECT – EXPLORATION AND RESOURCE DEVELOPMENT
The 100% owned Anthill project is located 54km northwest of Kalgoorlie – Boulder on the highly prospective Zuleika
shear zone (Figures 2 and 5). In total, 16,778m of resource extension and new discovery drilling was completed at Anthill
during the year as part of the 55,000m 2018 program.
A final summary of results from the program was announced to the ASX on 18 December 2018 and included:
23m @ 4.16g/t Au from 61m and 18m @ 3.13g/t Au from 70m
31m @ 3.28g/t Au from 112m and 19m @ 2.70g/t Au from 57m
10m @ 2.79g/t Au from 80m and 21m @ 1.94g/t Au from 33m
25m @ 2.53g/t Au from 132m and 23m @ 3.22g/t Au from 174m
The drilling programs have been highly successful in extending mineralisation to the south and extending the strike length
by over 200m. New mineralisation was also intercepted to the east of the resource envelope and aligned with the
dominant NW “Zuleika Shear” stratigraphy. Mining studies at Anthill commenced during the period with expected
completion in mid-2020 as part of the consolidated Feasibility Study. Further extensional drilling is also planned.
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
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OPERATIONS REPORT
As announced to the ASX on 18 December 2018, the new data was used to compile a detailed independent Mineral
Resource Estimate which is compliant with the JORC 2012 Code.
The updated Mineral Resource Estimate for the Anthill project stands at 2.28Mt grading 1.71g/t Au for 125,500 ounces
(at a 1g/t Au lower cut-off grade) (see Table 1 and Competent Persons Statement on Page 13).
Figure 5
Horizon Minerals Ltd Anthill gold project
BINDULI GOLD PROJECT AREA – EXPLORATION
The Binduli project is located 9km west of Kalgoorlie – Boulder immediately adjacent to the Company’s Teal project area
(Figures 2 and 6). In March 2018, the Binduli joint venture tenements were returned to Horizon (formerly Intermin) on a
100% basis with the Company commencing an initial 5,000m RC program at the Crake prospect shortly thereafter.
During 2018, Horizon (formerly Intermin) drilled 8,108m (including 2,620m drilled prior to FY 2019) into the Crake
prospect to assist in building an initial JORC compliant resource. Following on from this another 1,098m was drilled at
Crake from June to July 2019 and was designed to improve the confidence level of the resource plus follow up, shallow
open ended mineralisation. Another 3,512m were drilled at regional prospects at Coote, Darter and Honeyeater.
Results from Crake were announced to the ASX on 12 March and 25 June 2019 and included:
23m @ 4.16g/t Au from 61m including 3m @ 20.73g/t Au from 66m
13m @ 4.10g/t Au from 65 including 2m @ 18.53g/t Au from 75m
18m @ 3.13g/t Au from 70m and 15m @ 2.75g/t Au from 27m
9m @ 4.38g/t Au from 39m and 15m @ 1.96g/t Au from 75m
12m @ 1.75g/t Au from 45m and 8m @ 2.51g/t Au from 106m
4m @ 11.3g/t Au from 80m and 8m @ 2.71g/t Au from 104m
8m @ 5.78g/t Au from 36m and 16m @ 2.32g/t Au from 52m
8m @ 3.01g/t Au from 112m and 12m @ 1.71g/t Au from 44m
Results from the drilling show significant gold mineralisation over a 450m strike length and remains open along strike
and at depth. Follow up drilling continues at Crake with a further 5,000m planned to test further extensions and test new
high priority targets at Coote, Honey Eater and Darter (Figure 3).
Given the success to date at Binduli, the project has been elevated to one of the top four core projects being advanced
by the Company in the Kalgoorlie region as part of the consolidated Feasibility Study.
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
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OPERATIONS REPORT
Figure 6
Horizon Minerals Ltd Binduli gold project area showing recent drilling results
As announced to the ASX on 12 March 2019, the new data was used to compile a detailed independent Mineral Resource
Estimate which is compliant with the JORC 2012 Code.
The maiden Mineral Resource Estimate for the Crake project stands at 1.12Mt grading 1.59g/t Au for 57,700 ounces (at
a 1g/t Au lower cut-off grade) (see Table 1 and Competent Persons Statement on Page 13).
BLISTER DAM GOLD PROJECT – EXPLORATION
The Blister Dam project is located 70km northwest of Kalgoorlie – Boulder on the Zuleika and Kunanulling shear zones
(Figures 2 and 7). Since acquisition in 2016, the Company has completed a detailed review of the large geological data
base comprising geochemical, geophysical and historic drilling datasets in order to prioritise targets for ranking and drill
testing. An Induced Polarisation (“IP”) survey, geological mapping and rock chip sampling were also completed and 21
high priority targets generated.
Of the 21 targets identified at Blister Dam, nine of these were subject to first pass drilling. The program was completed
in December 2017 with 46 Reverse Circulation (“RC”) holes drilled for 4,180m to an average depth of 150m. In 2018, the
Company conducted follow up drilling at Atlantic, Argo, Seven Seas, Chadwin and Loran with 6,954m completed.
Results from the programs were announced to the ASX on 6 February and 20 December 2018 and included:
6m @ 5.97g/t Au from 66m and 12m @ 4.03g/t Au from 16m (Argo)
5m @ 4.12g/t Au from 46m and 1m @ 19.90g/t Au from 24m (Argo)
1m @ 36.00g/t Au from 35m and 4m @ 3.33g/t Au from 43m (Seven Seas)
7m @ 1.54g/t Au from 59m and 9m @ 1.56g/t Au from 69m (Atlantic)
Follow up RC and diamond drilling is planned for the Blister Dam area in FY2020 with a focus on follow up drilling at
Argo, Atlantic and Loran to test strike and depth extensions.
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
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OPERATIONS REPORT
Figure 7
Horizon Minerals Ltd Blister Dam gold project
KALGOORLIE REGIONAL GOLD PROJECTS – EXPLORATION
During the year, exploration drilling continued on our regional projects with 1,619m drilled at the Menzies, Olympia,
Baden Powell-Scotia and Windanya prospects (Figure 2). In addition, significant field work, rock chip sampling, historic
mine mapping, geochemical and geophysical reviews were undertaken to identify priority targets for drilling in FY2020.
These prospects included Kanowna north, Lakewood, Yarmany, Windanya, Black Flag, Scotia, Broads Dam and Area
54.
Work completed on new acquisitions at Boorara, Lakewood and Yarmany included data compilation, data base review
and desk top geological studies. The resultant drilling programs will commence in FY2020 pending final granting of the
leases. The low cost acquisitions have increased the Company’s tenure to approximately 1,100km2.
MENZIES AND GOONGARRIE GOLD PROJECT
As announced to the ASX on 7 February 2019, the Company agreed to a Deed of Settlement and Termination with
Eastern Goldfields Ltd covering the Menzies and Goongarrie farm in joint venture with the projects returning to Horizon
on a 100% basis.
Subsequent to year end and as announced to the ASX on 9 July 2019, the Company reached agreement with Kingwest
Resources Limited to divest the project for a total consideration of A$8 million enabling the Company to focus on its core
projects in the Kalgoorlie and Coolgardie regions.
Horizon will become a substantial shareholder in Kingwest with Board representation and will have a right to process or
purchase any ore from the sale tenements under standard commercial terms. For further details on the divestment,
please see announcements of 9 July 2019 and 18 September 2019.
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
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OPERATIONS REPORT
LEHMANS GOLD JV – EXPLORATION PROJECT
As announced to the ASX on 7 November 2018, the Company agreed to divest its interest in the Lehmans Gold Joint
Venture to Saracen Mineral Holdings for A$2.5 million in cash and a capped royalty. Holding a non-core minority holding
in a project in the North Eastern goldfields was considered a distraction from our focus of building a gold business in the
Kalgoorlie region with the consideration strengthening the Company’s financial position.
M26/446 (JANET IVY) GOLD PRODUCTION ROYALTY
Horizon owns a $0.50/t mining royalty that relates to ore mined and treated from Mining Lease M26/446 located
approximately 10km west of Kalgoorlie-Boulder in Western Australia (Figure 2). The Company entered into a Deed for
the sale of M26/446 in 2001 and it is now owned by Norton Gold Fields Ltd (“NGF”) which was delisted from the ASX on
1 July 2015.
As part of the sale, the Company was prepaid $1,380,000 of the royalty as part of the acquisition cost, equivalent to a
mining and treatment tonnage of 2.76Mt ($0.50/t). Mining has been conducted on a semi-continuous basis at the Janet
Ivy deposit which is the largest of known deposits on M26/466 since 2009.
During the year, royalties received from the royalty tenement totalled $395,000. Horizon anticipates further royalty
payments on a quarterly basis for material scheduled by NGF to be treated.
RICHMOND VANADIUM JV – EXPLORATION PROJECT (IRC retains 25%)
In March 2017, the Company finalised a strategic development JV with AXF Vanadium Pty Ltd, now Richmond Vanadium
Technologies Pty Ltd (“RVT”). The JV covers Horizon’s 100% interest in the Richmond vanadium project in North West
Queensland (Figures 8 and 9) which include metal rights at the nearby Julia Creek project which is owned by Global Oil
Shale Plc. The project tenements cover 1,520km2 of Cretaceous Toolebuc Formation hosting shallow oxide ore within
marine sediments.
Figure 8
Horizon Minerals Ltd Richmond Vanadium Project location
Under the JV, RVT has earnt in to 25% of the project by spending A$1 million and committed to spend a further $5 million
by March 2021 to earn in the remaining 50% inclusive of providing a pre-feasibility study.
In March 2018, the Company released an updated Mineral Resource estimate for the project to account for changes in
tenement boundaries and to ensure compliance with the JORC Code (2012) The Mineral Resource for the Richmond
Project area now stands at 2,579Mt at 0.32% V2O5 at a 0.29% lower cut-off grade (see Table 2 and Competent Persons
Statement on Page 13).
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OPERATIONS REPORT
During the year, RVT continued metallurgical test work in China focussed on optimising pre-concentration of the ore and
downstream processing metallurgical testwork with preliminary results indicating encouraging upgrade potential.
As announced to the ASX on 29 April 2019, physical separation resulted in 73% of the vanadium recovered into 21% of
the original mass at a grade of 1.58% V2O5. This reduced mass and upgrade ratio enables a potentially smaller
downstream processing plant at significantly reduced capital cost. In addition, the results show a much larger reduction
in the calcium content than expected with only 4% reporting to the concentrate fraction. This low calcium content, if
repeatable, enables both the acid digestion and roasting downstream pathways to be evaluated that can potentially lead
to lower operating costs.
These results provided JV partner AXF with growing confidence in the quality of the project and formed the basis to move
to the next stage where a further $5 million has been committed by AXF to further optimise pre-concentration, commence
downstream processing test work and develop a pathway to commercial production.
During the year, a 3,303m infill and regional drilling program commenced across the property to test a number of priority
targets and to upgrade the Lilyvale resource to the Measured and Indicated categories as part of the pre-feasibility study
Horizon sees significant potential of vanadium to play an increasing role in both the steel industry and the emerging
battery storage space and for the Richmond oxide sediment resource to be a considerable provider of vanadium well
into the next century. The drilling, updated resource model and the pre-feasibility study is expected to be completed in
2020, ahead of the contracted earn in period.
Figure 9
Horizon Minerals Ltd Richmond Vanadium tenement locations
NANADIE WELL Cu-Ni-Co-PGE-Au JV - EXPLORATION PROJECT (IRC retains 25%)
The Nanadie Well Project is located approximately 100km south east of Meekatharra in the Murchison Mineral Field of
WA and covers an area of ~145km2 (Figure 1). In December 2013, Horizon (formerly Intermin) entered into a Farm-in
and Joint Venture agreement with Mithril Resources Ltd (ASX: MTH) (“Mithril”) whereby Mithril could earn a 75% interest
by spending $4M over 6 years. The project is highly prospective for Copper, gold, nickel, cobalt and platinum group
elements.
The Project covers part of a northwest trending belt of Archean mafic and metasedimentary units with demonstrated
prospectivity for both magmatic copper–nickel–PGE mineralisation and lode gold mineralisation. The project hosts the
Nanadie Well copper deposit where a 2004 JORC Code Compliant Inferred Resource of 36.07Mt @ 0.42% copper
(151,506 tonnes copper) was estimated by Horizon (formerly Intermin) in September 2013 (refer ASX announcement
dated 19 September 2013).
During the year Mithril completed predominantly desktop work and some minor field work.
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OPERATIONS REPORT
WHITE RANGE GOLD PROJECT (DISPOSED)
Horizon (formerly Intermin) has disposed of its White Range Gold Project in the Northern Territory to Red Dingo
Corporation Pty Ltd. The Company is currently attending to some clean up issues at the site prior to making application
for return of environmental bonds held by the Department of Primary Industry and Resources in respect of the White
Range tenements.
MINERAL RESOURCES
Table 1: Horizon Minerals limited (formerly Intermin Resources Ltd) – Summary of Gold Mineral Resources (at a
1g/t Au cut-off grade)
Deposit
Measured
(1g/t cut-off)
Mt
Au (g/t)
Oz
Teal
Menzies
Anthill
Goongarrie
0.17
2.62
14,000
Binduli
TOTAL
0.17
2.62
14,000
Indicated
Au (g/t)
Oz
2.08
2.52
1.76
2.15
1.67
2.00
194,848
62,400
85,495
6,900
39,900
389,500
Mt
1.34
1.65
0.77
0.04
0.38
4.18
Mt
2.91
0.77
1.51
0.10
0.74
6.03
Inferred
Au (g/t)
Oz
94,140
108,910
40,084
3,000
17,800
2.19
2.14
1.61
2.14
1.45
1.96
Mt
4.25
2.42
2.28
0.31
1.12
Total Resource
Au (g/t)
Oz
2.11
2.20
1.71
2.40
1.59
2.00
288,833
171,310
125,582
23,900
57,700
667,500
264,000
10.38
Table 2: Horizon Minerals limited (formerly Intermin Resources Ltd) – Summary of V2O5 / Mo Resources (at a
0.29% V2O5 cut-off grade)
Tonnage
(Mt)
1,764
671
96
48
2,579
Grade
% V2O5
0.31
0.35
0.33
0.31
0.32
Grade
g/t MoO3
253
274
358
264
262
Notes
(1) Rothbury
(2) Lilyvale
(3) Manfred
(4) Burwood (100% metal rights)
Category
Inferred (1)
Inferred (2)
Inferred (3)
Inferred (4)
TOTAL
Notes:
1. Competent Persons Statement - The information in this report that relates to Exploration results, Mineral Resources or Ore
Reserves is based on information compiled by Messrs David O’Farrell, Simon Coxhell and Andrew Hawker. All are Members of the
Australasian Institute of Mining and Metallurgy and are consultants to Horizon Minerals Limited (formerly Intermin Resources Ltd).
The information was prepared and first disclosed under the JORC Code 2004 and has been updated to comply with the JORC Code
2012. Messrs O’Farrell, Coxhell and Hawker have sufficient experience that is relevant to the style of mineralisation, type of deposit
under consideration and to the activity that they are undertaking to qualify as a Competent Person as defined in the 2012 edition of
the ‘Australasian Code for Reporting of Exploration, Results, Mineral Resource and Ore Reserves’. Messrs O’Farrell, Coxhell and
Hawker consent to the inclusion in this report of the matters based on their information in the form and context in which they appear.
2. Forward Looking Statements - No representation or warranty is made as to the accuracy, completeness or reliability of the
information contained in this release. Any forward looking statements in this release are prepared on the basis of a number of
assumptions which may prove to be incorrect and the current intention, plans, expectations and beliefs about future events are
subject to risks, uncertainties and other factors, many of which are outside of Horizon Minerals Limited’s (formerly Intermin
Resources Ltd) control. Important factors that could cause actual results to differ materially from the assumptions or expectations
expressed or implied in this release include known and unknown risks. Because actual results could differ materially to the
assumptions made and Horizon Minerals Limited’s (formerly Intermin Resources Ltd) current intention, plans, expectations and
beliefs about the future, you are urged to view all forward looking statements contained in this release with caution. The release
should not be relied upon as a recommendation or forecast by Horizon Minerals Limited (formerly Intermin Resources Ltd). Nothing
in this release should be construed as either an offer to sell or a solicitation of an offer to buy or sell shares in any jurisdiction.
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 1 3
OPERATIONS REPORT
Macphersons Resources Limited (a 100% subsidiary of Horizon (formerly Intermin)) – Summary of Mineral
Resources
Boorara Gold Resource (at a 0.5 g/t Au cut-off grade)
Category
Tonnes
Grade
Ounces
Measured Resource
Indicated Resource
Inferred Resource
Total Resource
Mt
Au (g/t)
(k'000)
6.11
7.26
3.08
16.45
0.92
0.97
1.00
0.96
181
227
99
507
Nimbus All Lodes (bottom cuts 12 g/t Ag, 0.5% Zn, 0.3 g/t Au)
Category
Tonnes
Grade
Grade
Grade
Ounces Ounces
Tonnes
Measured Resource
Indicated Resource
Inferred Resource
Total Resource
Mt
Ag (g/t)
Au (g/t)
Zn (%)
3.62
3.18
5.28
12.08
102
48
20
52
0.09
0.21
0.27
0.20
1.2
1.0
0.5
0.9
Ag
(Moz's)
Au
(k'000)
(k'000)
11.9
4.9
3.4
20.2
10
21
46
77
45
30
29
104
Nimbus high grade silver zinc resource (500 g/t Ag bottom cut and 2800 g/t Ag top cut)
Category
Tonnes
Grade
Grade
Ounces
Tonnes
Mt
0
0.17
0.09
0.26
Ag (g/t)
Zn (%)
Ag (Moz's)
(k'000)
0
762
797
774
0
12.8
13.0
12.8
0
4.2
2.2
6.4
0
22
11
33
Measured Resource
Indicated Resource
Inferred Resource
Total Resource
Confirmation
The information is this report that relates to MacPhersons’ Mineral Resources estimates on the Boorara Gold Project and
Nimbus Silver Zinc Project is extracted from and was originally reported in Horizon’s (formerly Intermin’s) and
MacPhersons’ ASX Announcement “Intermin and MacPhersons Agree to Merge – Creation of a New Gold Company
Horizon Minerals Ltd” dated 11 December 2018 and in MacPhersons’ ASX announcements “Quarterly Activities Report”
dated 25 October 2018, “BOORARA GOLD PROJECT TOTAL GOLD RESOURCE up 118% to 507,000 OUNCES” dated
6th March 2018, “New High Grade Nimbus Silver Core Averaging 968 g/t Ag” dated 10th May 2016, “Boorara Trial Open
Pit Produced 1550 Ounces” dated 14 November 2016 and “Nimbus Increases Resources” dated 30th April 2015, each
of which is available at www.asx.com.au. The Company confirms that it is not aware of any new information or data that
materially affects the information included in the original market announcements and that all material assumptions and
technical parameters underpinning the estimates in those announcements continue to apply and have not materially
changed. The Company confirms that the form and context of the Competent Person’s findings in relation to those Mineral
Resources estimates have not been materially modified from the original market announcements.
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 1 4
OPERATIONS REPORT
FORWARD LOOKING AND CAUTIONARY STATEMENTS
Some statements in this report regarding estimates or future events are forward looking statements. They include
indications of, and guidance on, future earnings, cash flow, costs and financial performance. Forward looking statements
include, but are not limited to, statements preceded by words such as “planned”, “expected”, “projected”, “estimated”,
“may”, “scheduled”, “intends”, “anticipates”, “believes”, “potential”, “could”, “nominal”, “conceptual” and similar
expressions. Forward looking statements, opinions and estimates included in this announcement are based on
assumptions and contingencies which are subject to change without notice, as are statements about market and industry
trends, which are based on interpretations of current market conditions. Forward looking statements are provided as a
general guide only and should not be relied on as a guarantee of future performance. Forward looking statements may
be affected by a range of variables that could cause actual results to differ from estimated results, and may cause the
Company’s actual performance and financial results in future periods to materially differ from any projections of future
performance or results expressed or implied by such forward looking statements. These risks and uncertainties include
but are not limited to liabilities inherent in mine development and production, geological, mining and processing technical
problems, the inability to obtain any additional mine licenses, permits and other regulatory approvals required in
connection with mining and third party processing operations, competition for among other things, capital, acquisition of
reserves, undeveloped lands and skilled personnel, incorrect assessments of the value of acquisitions, changes in
commodity prices and exchange rate, currency and interest fluctuations, various events which could disrupt operations
and/or the transportation of mineral products, including labour stoppages and severe weather conditions, the demand
for and availability of transportation services, the ability to secure adequate financing and management’s ability to
anticipate and manage the foregoing factors and risks. There can be no assurance that forward looking statements will
prove to be correct.
Statements regarding plans with respect to the Company’s mineral properties may contain forward looking statements
in relation to future matters that can only be made where the Company has a reasonable basis for making those
statements.
This report has been prepared in compliance with the JORC Code (2012) and the current ASX Listing Rules.
The Company believes that it has a reasonable basis for making the forward looking statements in its reports and
announcements, including with respect to any production targets and financial estimates, based on the information
contained in this and previous ASX reports and announcements.
CORPORATE GOVERNANCE - RESERVES AND RESOURCES CALCULATIONS
Due to the nature, stage and size of the Company’s existing operations, Horizon (formerly Intermin) is of the opinion
there would be no efficiencies gained by establishing a separate Mineral Reserves and Resources committee responsible
for reviewing and monitoring the Company’s processes for calculating Mineral Reserves and Resources and for ensuring
that the appropriate internal controls are applied to such calculations. However, the Company ensures that all Mineral
Reserve and Resource calculations are prepared by competent, appropriately experienced geologists and are reviewed
and verified independently by a qualified person.
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 1 5
OPERATIONS REPORT
Table 3
Tenement Schedule as at 30 June 2019
Project
BINDULI
Tenement
Registered Holders
Equity
Notes
L26/261
M26/346
M26/499
M26/549
M26/621
P26/3888
P26/4014
P26/4056
P26/4256
P26/4316
P26/4317
P26/4321
P26/4322
P26/4324
P26/4325
P26/4330
P26/4332
P26/4333
P26/4337
P26/4338
P26/4339
P26/4340
P26/4341
P26/4342
P26/4343
P26/4344
P26/4345
ELA26/209
PLA26/4229
PLA26/4230
PLA26/4231
PLA26/4318
PLA26/4319
PLA26/4320
PLA26/4323
PLA26/4326
PLA26/4327
PLA26/4328
PLA26/4329
PLA26/4331
PLA26/4334
PLA26/4335
PLA26/4336
PLA26/4350
IRC
BMG
IRC
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 1 6
OPERATIONS REPORT
Table 3
Tenement Schedule as at 30 June 2019 (continued)
Project
Tenement
Registered Holders
Equity
Notes
WHITE FLAG
E26/168
E26/197
M26/616
P26/3576
P26/3577
P26/3922
P26/3923
P26/3988
P26/3989
P26/3990
P26/4078
P26/4079
P26/4080
P26/4081
KANOWNA
M27/487
P27/2209
P27/2215
P27/2316
P27/2317
P27/2319
GOONGARRIE
E29/966
E29/996
L29/109
M29/420
P29/2380
P29/2381
P29/2412
P29/2413
ELA29/1054
ELA29/1055
ELA29/1062
MLA29/430
MENZIES
E29/984
L29/42
L29/43
L29/44
M29/14
M29/88
M29/153
M29/154
M29/184
M29/212
M29/410
P29/2251
P29/2252
P29/2253
1
BMG
BMG
IRC
IRC
IRC
BMG
BMG
IRC
IRC
IRC
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 1 7
OPERATIONS REPORT
Table 3
Tenement Schedule as at 30 June 2019 (continued)
Tenement
Registered Holders
Project
MENZIES
ANTHILL
P29/2254
P29/2344
P29/2345
P29/2346
P29/2366
P29/2367
P29/2383
P29/2384
P29/2385
P29/2386
P29/2387
P29/2450
PLA29/2448
PLA29/2451
PLA29/2488
L16/92
M16/531
BLACK FLAG
P16/2820
P16/2821
P24/5143
P24/5144
P24/5145
P24/5146
P24/5147
P24/5148
P24/5149
P24/5150
P24/5151
P24/5152
P24/5153
P24/5154
P24/5155
P24/5156
P24/5157
P24/5158
P24/5159
P24/5160
P16/3121
P24/5186
CHADWIN
COOLGARDIE
PLA15/6380
SEVEN SEAS
E24/148
P16/2973
P16/2974
P16/2975
P16/2976
P16/2977
P16/2997
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
Equity
100%
Notes
0%
0%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 1 8
OPERATIONS REPORT
Table 3
Tenement Schedule as at 30 June 2019 (continued)
Project
SEVEN SEAS
Tenement
Registered Holders
Equity
Notes
P16/3002
P16/3003
P16/3004
P16/3005
P16/3006
P16/3007
P24/5107
MLA24/970
LAKEWOOD
PLA26/4360
PLA26/4361
PLA26/4362
PLA26/4363
PLA26/4364
PLA26/4365
PLA26/4366
PLA26/4367
PLA26/4368
PLA26/4369
PLA26/4370
NEW MEXICO
P24/4767
YARMANY
P24/4768
P24/4769
P24/5099
P24/5100
P24/5101
P24/5102
P24/5229
P24/5230
P24/5231
P24/5232
P24/5233
E16/470
E16/471
E16/492
E16/493
E16/494
E16/497
E16/499
E16/503
E16/510
ELA15/1655
ELA15/1723
ELA16/506
ELA16/507
ELA16/519
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 1 9
OPERATIONS REPORT
Table 3
Tenement Schedule as at 30 June 2019 (continued)
Tenement
Registered Holders
Equity
Notes
Project
YARMANY
WINDANYA
ELA16/521
ELA16/525
ELA16/526
PLA16/3212
PLA16/3213
M24/919
M24/959
P24/4702
P24/4703
P24/4817
P24/4897
P24/5046
P24/5047
P24/5048
P24/5049
P24/5050
P24/5051
P24/5052
P24/5053
P24/5054
P24/5055
P24/5056
P24/5057
P24/5058
P24/5059
P24/5106
P24/5108
P24/5116
P24/5165
P24/5166
P24/5167
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
BMG
KOTC
KOTC
KOTC
KOTC
POLY
KOTC
POLY
POLY
POLY
KOTC
KOTC
POLY
POLY
POLY
POLY
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 2 0
NIMBUS/BOORARA E25/511
L25/32
L25/35
L25/36
L26/240
L26/252
L26/266
L26/270
L26/274
L26/275
M25/355
M26/29
M26/161
M26/277
M26/318
OPERATIONS REPORT
Table 3
Tenement Schedule as at 30 June 2019 (continued)
Project
Tenement
Registered Holders
Equity
Notes
NIMBUS/BOORARA M26/490
M26/598
P25/2247
P25/2261
P25/2292
P25/2322
P25/2393
P25/2394
P25/2403
P25/2404
P25/2405
P25/2450
P25/2467
P25/2468
P25/2469
P25/2470
P25/2471
P25/2472
P25/2473
P25/2474
P25/2475
P25/2526
P25/2551
P25/2552
P26/4020
P26/4035
P26/4036
P26/4053
P26/4054
P26/4055
PLA26/4199
PLA26/4200
PLA26/4201
PLA26/4202
PLA26/4203
PLA26/4204
PLA26/4205
PLA26/4206
PLA26/4207
PLA26/4208
P26/4297
P26/4298
P26/4299
P26/4300
P26/4301
P26/4302
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
POLY
POLY
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 2 1
OPERATIONS REPORT
Table 3
Tenement Schedule as at 30 June 2019 (continued)
Project
Tenement
Registered Holders
Equity
Notes
NIMBUS/BOORARA P26/4381
P26/4382
P26/4383
P26/4384
P26/4385
P26/4386
PLA26/4405
PLA26/4431
PLA26/4432
PLA26/4478
PLA26/4479
P27/2318
P27/2139
P27/2140
P27/2141
P27/2142
P27/2146
P27/2147
P27/2148
P27/2265
P27/2266
P27/2267
P27/2268
P27/2269
P27/2270
P27/2271
P27/2272
P27/2273
P27/2274
P27/2275
P27/2276
PLA27/2408
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
KOTC
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
Joint Ventures
Nanadie Well JV
E51/1040
Richmond JV
Royalties
Janet Ivy
Otto Bore
Julia Creek
EPM25163
EPM25164
EPM25258
EPM26425
EPM26426
M26/446
M26/833
M36/177
EPM17775
MDL396
EPM19830
HRZ/MTH
HRZ/RVT
HRZ/RVT
HRZ/RVT
HRZ/RVT
HRZ/RVT
NGF
NGF
PLT
Xtract Oil Ltd
GOS
GOS
HRZ 100%
HRZ 75%/RVT 25%
HRZ 75%/RVT 25%
HRZ 75%/RVT 25%
HRZ 75%/RVT 25%
HRZ 75%/RVT 25%
HRZ 0%
HRZ 0%
HRZ 0%
HRZ 0%
HRZ 0%
HRZ 0%
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 2 2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
3
4
4
4
4
4
5
5
6
-
7
7
OPERATIONS REPORT
Abbreviations
BMG
GOS
HRZ
IRC
KOTC
Black Mountain Gold Ltd
Global Oil Shale
Horizon Minerals Limited
Intermin Resources Limited
Kalgoorlie Ore Treatment Company Pty Ltd
MTH
NGF
PLT
POLY
RVT
Mithril Resources Ltd
Norton Gold Fields Ltd
Plutonic Operations Ltd (subsidiary of Barrick Asia Pacific Ltd)
Polymetals (WA) Pty Ltd
Richmond Vanadium Technology Pty Ltd (formerly AXF
Vanadium Pty Ltd)
Notes
(1) Royalty of $1 per tonne of ore mined and treated from M26/616 is payable to Pamela Jean Buchhorn.
(2) Merger with MacPhersons Resources Limited completed on 14 June 2019.
(3) Farmin and JV with Mithril Resources Ltd whereby Mithril can earn an initial 60% interest by expending $2,000,000 within 4 years.
Mithril may earn an additional 15% (75% total) by expending a further $2,000,000 over two years.
(4) An earn-in JV whereby RVT can earn 25% of the project area by spending A$1M within a 1 year period and maintaining the project
in good standing – completed February 2018. RVT to solely contribute to further expenditure of $5m on the projects to earn a
further 50% over a 3 year period.
(5) Royalty of $0.50 per tonne of ore mined payable to HRZ after the first 2.76 million tonnes (prepaid).
(6) HRZ is entitled to a royalty of 3% gold recovered from the Otto Bore tenements.
(7) Global Oil Shale has 100% ownership of the Julia Creek block of tenements subject to a right by Horizon to recover metal values
from oil shale mineralisation outlined and from any tailings or residues produced by GOS as a result of oil or hydrocarbon
production from the Julia Creek tenements.
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 2 3
DIRECTORS' REPORT
Your Directors have the pleasure in presenting their report together with the financial statements of the Group (hereafter
referred to as the Group) for the financial year ended 30 June 2019 and the auditor’s report thereon.
DIRECTORS
The following persons held office as Directors of Horizon Minerals Limited (formerly Intermin Resources Limited) during
the financial year and up to the date of this report:
Peter Bilbe
Jonathan Price
Ashok Parekh (Appointed 14 June 2019)
Jeffrey Williams (Appointed 14 June 2019)
Peter Hunt (Resigned 14 June 2019)
Directors have been in office since the start of the financial year to the date of this report unless otherwise stated.
INFORMATION ON DIRECTORS AND OFFICERS
Peter Bilbe, B.Eng. (Mining) (Hons), MAusIMM, Chairman and Independent Non-Executive Director (Appointed
1 July 2016, Appointed Chairman 21 November 2016)
Mr Bilbe is a Mining Engineer with over 40 years’ experience in the Australian and International mining industry at the
operating, corporate and business level. He has comprehensive experience in all facets of open pit and underground
mining and processing operations including exploration, feasibility studies, construction and provision of mining contract
services.
Directorships held in other listed companies in the past 3 years:
Independence Group NL (ASX: IGO) (Appointed 6 April 2009)
-
- Adriatic Metals PLC (ASX ADT): (Appointed 16 February 2018)
- Northern Iron Limited (Appointed 5 November 2007, Resigned 16 May 2016)
Jonathan Price, Managing Director (Appointed 1 January 2016)
Mr Price has over 25 years’ experience in Australia and overseas across all aspects of the industry including exploration,
development, construction and mining operations in the gold and advanced minerals sectors. Jon graduated as a
metallurgist and holds a Masters in Mineral Economics from the Western Australian School of Mines. He then worked in
various gold and advanced mineral operations including general manager of the Paddington gold and St Ives gold
operations in the Western Australian goldfields.
More recently, Jon was the founding Managing Director of Phoenix Gold Ltd, acquired by Evolution Mining Ltd. During
his tenure, Jon oversaw the reconsolidation of underexplored tenure in the Western Australian goldfields and realised
significant exploration success.
Directorships held in other listed companies in the past 3 years:
- Nil
Ashok Parekh, Non-Executive Director (Appointed 14 June 2019)
Mr Ashok Parekh is a chartered accountant, of over 40 years’ experience, who owns a large accounting practice in
Kalgoorlie, which he has operated for 33 years. He was awarded the Centenary Medal in 2003 by the Governor General
of Australia, and was recently awarded the Meritorious Service Award by the Institute of Chartered Accountants, the
highest award granted by the institute in Australia.
Mr Parekh has over 33 years’ experience in providing advice to mining companies and service providers to the mining
industry. He has spent many years negotiating with public listed companies and prospectors on mining deals which have
resulted in new IPOs and the commencement of new gold mining operations. He has also been involved in the
management of gold mining and milling companies in the Kalgoorlie region, and has been the Managing Director of some
of these companies. He is well known in the West Australian mining industry and has a very successful background in
the ownership of numerous businesses in the Goldfields.
Directorships held in other listed companies in the past 3 years:
- MacPhersons Resources Limited (Appointed 9 September 2009 – 13 June 2019 upon delisting)
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 2 4
DIRECTORS' REPORT
INFORMATION ON DIRECTORS AND OFFICERS (CONTINUED)
Jeffrey Williams, Non-Executive Director (Appointed 14 June 2019)
Mr Jeffrey Williams has over 40 years’ industry experience, with 16 years’ experience as a professional mining engineer
in Australia and seven years in the stockbroking industry, and is a Fellow of the Australasian Institute of Mining and
Metallurgy. His mining experience ranges from mine planning, underground management and feasibility studies through
to mine development.
Mr Williams was the Managing Director of Mineral Deposits Ltd for 15 years and departed in late 2011. He secured the
Sabodala gold and Grande Cote zircon projects in Senegal in West Africa, and commenced gold production in March
2009. Mr Williams has since been involved in other smaller mining companies on the ASX to develop exploration plans,
mostly in Australia.
Directorships held in other listed companies in the past 3 years:
- Alice Queen Limited (Appointed 16 March 2012, Resigned 10 August 2016)
- World Titanium Resources Limited (Appointed January 2012, Resigned 9 September 2016)
- Herencia Resources plc (Appointed 31 March 2017)
- MacPhersons Resources Limited (Appointed 9 September 2009 – 13 June 2019 upon delisting)
Peter Hunt, Independent Non-Executive Director (Resigned 14 June 2019)
Mr Hunt has been a Non-Executive Director of Intermin Resources Ltd since 25 October 1989 and is a Chartered
Accountant and Consultant to BDO Adelaide. He was a former partner of PKF Adelaide, Chartered Accountants, which
merged with BDO Adelaide in 2012. He has broad experience as an independent director and chairman of ASX listed
and private companies.
Directorships held in other listed companies in the past 3 years:
- UXA Resources Ltd (ASX: UXA), Non-Executive Chairman, Appointed 26 August 2014
- Xped Limited (ASX: XPE), Non-Executive Director, Appointed 4 September 2017
- Metaliko Resources Limited, Non-Executive Director, Appointed 28 June 2012, Resigned 12 January 2017
Bianca Taveira, Company Secretary
Mrs Taveira is an experienced company administrator and manager who has acted as Company Secretary to a number
of unlisted public and ASX listed natural resource companies for over two decades. During this time Mrs Taveira has
been involved in a number of initial public offerings, reverse takeover transactions, corporate transactions and capital
raisings. Mrs Taveira has a corporate and compliance background and is experienced with administration of the
shareholder registry, the ASX Listing Rules, mining tenement management and the Department of Mines regulations.
Mrs Taveira is currently also the Company Secretary of Reward Minerals Ltd (ASX: RWD) and Yandal Resources Limited
(ASX: YRL).
CORPORATE INFORMATION
Horizon Minerals Limited is a Company limited by shares that is incorporated and domiciled in Australia.
PRINCIPAL ACTIVITIES
The principal continuing activities during the year of the Group, constituted by Horizon Minerals Limited and the entities
it controlled during the year, consisted of exploration for and mining of gold and other mineral resources.
OPERATING RESULTS
The net loss of the Group for the year ended 30 June 2019, after providing for income tax, amounted to $3,134,895
(2018: Profit $3,521,141).
REVIEW OF OPERATIONS
Exploration Activity
Please refer to the Exploration and Development Activities of the Operations Report for detailed information on the
Group’s exploration activities over the past year.
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 2 5
DIRECTORS' REPORT
SIGNIFICANT CHANGES IN STATE OF AFFAIRS
On 1 August 2018 the Company issued 4,250,000 shares upon exercise of unlisted options by Jon Price and Peter
Bilbe for a total sum of $406,250.
On 3 September 2018 the Company advised that a total of 3,226,345 shares were issued after receiving final option
exercise forms and payments totalling $548,478 which related to the options expiring on 31 August 2018 at an
exercise price of 17 cents.
On 20 November 2018 the Company divested its 100% interest in the Lehmann’s Well Gold Joint Venture for a cash
payment of $2,500,000 plus 2.5% Net Smelter Royalty once Saracen has produced 42,000 ounces of gold from the
transaction tenements and ending once Saracen has produced 100,000 ounces from the transaction tenements.
On 11 December 2018 the Company executed a Merger Implementation Agreement to progress the merger between
MacPhersons Resources Limited and Horizon Minerals Limited (formerly Intermin Resources Ltd) through a Scheme
of Arrangement.
On 19 December 2018 the Company reached a full and final settlement with mining contractor Resource Mining Pty
Ltd over claims relating to the completed Teal gold mine Stages 1 and 2.
On 7 February 2019 the Company’s Menzies and Goongarrie Gold Projects were returned on a 100% basis after a
Deed of Settlement and Termination with Eastern Goldfields (Administrators appointed) was executed. In addition,
Horizon (formerly Intermin) arranged for an off market sale of the remaining shares held by EGS which was taken up
by existing HRZ (formerly IRC) shareholders.
On 11 February 2019 the Company signed an Exclusivity Deed with Focus Minerals Limited for the potential
acquisition of the Coolgardie Gold Project which includes the 1.2Mtpa Three Mile Hill processing plant.
On 14 June 2019 the Company announced the Scheme of Arrangement was implemented completing the merger of
MacPhersons Resources Limited. A total of 192,586,736 shares, 2,743,184 Unlisted Options with an exercise price
of $0.2912 expiring 9 December 2019 and 219,456 Unlisted Options with an exercise price of $0.6988 expiring 28
February 2020 were issued in exchange for a 100% interest in MacPhersons Resources Limited and its controlled
entities.
On 14 June 2019 Mr Ashok Parekh and Mr Jeffrey Williams were appointed to the Board
On 14 June 2019 Mr Peter Hunt stepped down from the Board.
MATTERS SUBSEQUENT TO THE END OF THE FINANCIAL YEAR
(a) Subsequent to year end, 3,300,000 Class D Performance Rights lapsed and 500,000 unlisted options with an exercise
price of $0.25 expired on 31 August 2019.
(b) On 24 July 2019, the Company changed its name from Intermin Resources Limited to Horizon Minerals Limited.
(c) Kingwest Resources Limited
On 9 July 2019, the Group announced it reached an agreement with Kingwest Resources Limited (ASX: KWR)
(Kingwest) to divest its Menzies and Goongarrie gold projects for a total consideration of $8,000,000 on the following
terms:
Initial cash deposit of $750,000 (received) of which $250,000 is non-refundable.
On settlement:
o A further $1,000,000 in cash; and
o
Issue 20 million ordinary shares in Kingwest to Horizon at a deemed issue price of $0.15 per share and subject
to voluntary escrow from issue until the earlier of;
- 18 months following settlement; and
- 3 months following the payment/issue of the deferred consideration.
A deferred payment no later than 18 months after settlement of:
o A further $1,625,000 in cash; and
o $1,625,000 in value of ordinary shares in Kingwest at a deemed issue price being the lower of $0.15 per share
and a 30 day VWAP (subject to shareholder approval and Horizon not exceeding 19.9% ownership in Kingwest).
Settlement is subject to the following key conditions precedent:
Completion of due diligence by Kingwest;
Kingwest completing a minimum $4,000,000 capital raising;
Shareholder approval of the issue of the upfront consideration shares and shares under the capital raising; and
A Horizon nominee director to be appointed to the Kingwest Board.
The divestment comprises 38 mining, prospecting and exploration licences with a current JORC resource of 195,000
ounces.
On 18 September 2019, the Group announced that the divestment of Horizon’s interest in the Menzies and
Goongarrie gold projects were completed. All conditions precedent including provision of signed transfers, all mining
information and statutory consents have been completed or waived, Jon Price was appointed as Non-Executive
Director of Kingwest and the settlement payment and share issue received from Kingwest.
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 2 6
DIRECTORS' REPORT
MATTERS SUBSEQUENT TO THE END OF THE FINANCIAL YEAR (continued)
(d)
Coolgardie Gold Project
During the year ended 30 June 2019, Horizon entered into an Exclusivity Deed with Focus Minerals Limited (ASX:
FML) (Focus) relating to the potential acquisition by Horizon of Focus’ Coolgardie Gold Project.
The Exclusivity Deed includes “no shop” and “no talk” restrictions in favour of Horizon as well as notification and
matching rights in respect of any competing proposals for the Coolgardie Gold project, subject to customary
fiduciary carve outs of Focus’ benefit.
Subsequent to year end, Horizon exercised its matching right under the Exclusivity Deed in response to a superior
competing non-binding proposal to purchase the Coolgardie Gold Project received by Focus from a third party
and has submitted a non-binding counter proposal. The counter proposal increases the proposed consideration
from $40 million to $55 million comprising $12 million in fully paid ordinary shares (based on 20 day VWAP) and
$43 million in cash, payable in tranches. This proposal remains subject to negotiation and entry into formal binding
written documentation and obtaining necessary approvals.
(e)
Asset Swap with Northern Star Resources
On 12 September 2019 the Group announced it had reached agreement with Northern Star Resources Limited
to a tenement exchange in the WA Goldfields for nil cash consideration.
The transaction would see Horizon divest its 100% interest in the Anthill, Blister Dam, New Mexico, White Flag
and Kanowna North tenements and acquire 100% interest in Northern Star’s Rosehill, Brilliant North and Gunga
West projects in Coolgardie and the Golden Ridge, Balagundi, Abattoir and Mt Monger projects in Kalgoorlie.
There are no other matters or circumstances that have arisen since 30 June 2019 that have or may significantly affect
the operations, results, or state of affairs of the Group in future financial periods.
LIKELY DEVELOPMENTS AND EXPECTED RESULTS OF OPERATIONS
In the opinion of the Directors it would prejudice the interests of the Group to provide additional information, beyond that
reported in this Annual Report, relating to likely developments in the operations of the Group and the expected results of
those operations in financial years subsequent to 30 June 2019.
DIVIDENDS PAID OR RECOMMENDED
Since the end of the previous financial year, no amount has been paid or declared by way of dividend. The Directors do
not recommend that any dividend be paid.
MEETINGS OF DIRECTORS
The number of directors’ meetings (including meetings of committees of Directors) held and attended by each of the
Directors of the Group during the year were:
Full Meetings of Directors
Remuneration Committee
Directors
Eligible To
Participate
Number
Attended
Eligible To
Participate
Number
Attended
Peter Bilbe
Jonathan Price
Ashok Parekh
Jeff Williams
Peter Hunt
DIRECTORS INTERESTS
5
5
-
-
5
5
5
-
-
5
1
-
-
-
1
1
-
-
-
1
As at the date of this report interests of the Directors in the shares of the Company were:-
Ordinary Shares
Unlisted Options
Total Holdings
Directors
Direct Interest
Indirect Interest
Peter Bilbe
Jonathan Price
Ashok Parekh
Jeffrey Williams
-
1,980,000
4,500,000
8,908,873
-
-
14,155,480
2,367,578
Exercise Price
$0.2912
Expiry 9 Dec 2019
Shares
1,980,000
4,500,000
23,064,353
-
-
-
Unlisted
Options
-
-
-
1,371,592
2,367,578
1,371,592
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 2 7
DIRECTORS' REPORT
SHARES UNDER OPTION
Unissued ordinary shares of Horizon Minerals Limited under option as at the date of this report are as follows:
Nature
Expiry Date
Exercise Price of
Options
Number under
Option
Unlisted Options
9 December 2019
Unlisted Options
28 February 2020
29.12 cents
69.88 cents
2,743,184
219,456
Option holders do not have any rights to participate in any issues of shares or other interests in the Company or any
other entity.
There have been no unissued shares or interests under option of any controlled entity within the Group during or since
the end of the reporting period.
No person entitled to exercise the option had or has any right by virtue of the option to participate in any share issue of
any other body corporate.
AUDITED REMUNERATION REPORT
The information provided in this remuneration report has been audited as required by section 308(3C) of the Corporations
Act 2001.
REMUNERATION GOVERNANCE
The role of the Remuneration Committee has been assumed by the full Board. The Board’s policy for determining the
nature and amount of remuneration for board members and senior Executives of the Company is as follows:
The objective of the Company’s policy is to provide remuneration that is competitive and appropriate. The Board ensures
that executive reward satisfies the following key criteria for good reward governance practices:
(i)
(ii)
(iii)
(iv)
competitiveness and reasonableness;
acceptability to shareholders;
transparency;
and capital management.
(a) Details of Remuneration
The remuneration of the key management personnel of the Group are set out in the following tables:
The key management personnel of the Consolidated Entity consisted of the following directors of Horizon Minerals
Limited:
Jonathan Price – Managing Director
Peter Bilbe – Chairman and Independent Non-Executive Director
Ashok Parekh – Non-Executive Director (appointed 14 June 2019)
Peter Hunt – Independent Non-Executive Director (resigned 14 June 2019)
David Hughes (Lorry) – Executive Director (resigned 31 January 2018)
Jeff Williams – Non-Executive Director (appointed 14 June 2019)
And the following persons:
Grant Haywood – Chief Operating Officer
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 2 8
DIRECTORS' REPORT
(a)
Details of Remuneration (continued)
Short Term Benefits
Long Term Benefits
Salary &
Wages
$
Directors’
Fee
$
Share
based
payments
$
Post
Employment
Superannuation
$
Total
$
Performance
Related %
Name
Peter Bilbe
(Chairman)
Jonathan Price
(Managing Director)
Ashok Parekh
(Non-Executive Director)
Jeff Williams
(Non-Executive Director)
Peter Hunt
(Non-Executive Director –
resigned 14 June 2019)
2019
2018
2019
2018
2019
2018
2019
2018
2019
2018
Lorry Hughes
2019
(Executive Director –
resigned 31 January 2018) 2018
Other KMP
Grant Haywood
(COO)
Total
Total
2019
2018
2019
2018
-
-
65,000
39,054
60,000
45,364
385,496
295,000
-
-
97,635
155,848
-
-
-
-
-
-
-
142,617
327,004
228,000
5,812
-
5,812
-
-
-
-
-
40,000
39,054
40,000
45,364
-
-
-
-
-
25,500
13,549
181,666
14.0
48,817
93,324
29,491
21,660
72,702
405,312
342,984
1,126,386
12.0
27.2
712,500
116,624
224,560
665,617
100,000
365,400
74,934
1,205,951
6,175
5,700
29,932
28,025
552
-
552
-
6,000
6,000
-
110,229
111,064
513,063
478,873
6,364
-
6,364
-
85,054
91,364
35.4
40.8
19.0
32.5
-
-
-
-
45.9
49.7
-
-
The Company has no formal policy regarding the provision of Directors’ remuneration. Directors’ fees in total are
determined by the shareholders in a general meeting. No cash bonuses have been issued to Directors.
Shareholders have approved Directors’ Fees in total up to $250,000 per annum.
Directors are not under written contracts. Directors that are not on a salary may be paid consulting fees for specialist
services beyond normal duties at commercial rates calculated according to the amount of time spent on Company
business. In the year ended 30 June 2019 the directors have received share-based compensation for services as
directors of the Company. Full details are included below.
The share price of the Company has fluctuated with the markets and has also been influenced by the Company‘s
investments in other ASX listed companies. Over the past five years the directors’ fees have relatively remained static
and have not been influenced by the fluctuating share price.
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 2 9
DIRECTORS' REPORT
(b)
Interests in the Shares of the Company
Shares
The number of shares in the Company held during the financial year by key management personnel of Horizon Minerals
Limited, including their personally related parties, is set out below:
2019
Balance at the
start of the year
Balance held
at appointment
Shares sold
Performance
Rights
Vested
Exercise of
Options
Balance held at
resignation
Peter Bilbe
230,000
Jonathan Price
2,368,493
-
-
(300,000)
Ashok Parekh
Jeffrey Williams
-
-
23,064,353
2,367,578
Peter Hunt
6,411,699
Other KMP
Grant Haywood
1,250,000
-
-
-
-
-
-
TOTAL
10,260,192
25,431,931
(300,000)
-
-
-
-
-
-
-
1,750,000
2,750,000
-
-
-
(6,411,699)
-
62,500
-
1,312,500
4,562,500
(6,411,699)
33,542,924
Balance at the
end of the
year
1,980,000
4,818,493
23,064,353
2,367,578
-
-
-
-
2018
Balance at the
start of the year
Balance held at
appointment
Peter Bilbe
80,000
Jonathan Price
1,701,826
Peter Hunt
6,261,699
Lorry Hughes
2,527,253
Other KMP
-
-
-
-
Performance
Rights
Vested
150,000
666,667
150,000
Exercise of
Options
Balance held at
resignation
-
-
-
-
-
-
Balance at the
end of the
year
230,000
2,368,493
6,411,699
150,000
150,000
(2,827,253)
-
Grant Haywood
-
800,000
450,000
-
-
1,250,000
TOTAL
10,570,778
800,000
1,566,667
150,000
(2,827,253)
10,260,192
(c) Interests in the Options of the Company
2019
Balance at the
start of the year
Balance held at
appointment
Options
exercised
during year
Balance held at
resignation
Options lapsed
during the year
Balance at
30/06/19
Bal. vested and
exercisable at
30/06/19
No.
No.
No.
No.
No.
No.
No.
Peter Bilbe
1,790,000
Jonathan Price
2,750,000
Ashok Parekh
Jeffrey Williams
Peter Hunt
Other KMP
-
-
-
Grant Haywood
62,500
-
-
-
1,371,592
-
-
(1,750,000)
(2,750,000)
-
-
-
(62,500)
TOTAL
4,602,500
1,371,592
(4,562,500)
*Options are exercisable at $0.2912 on or before 9 December 2019
-
-
-
-
-
-
-
(40,000)
-
-
-
-
-
-
-
-
-
-
-
1,371,592*
1,371,592
-
-
-
-
(40,000)
1,371,592
1,371,592
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 3 0
DIRECTORS' REPORT
(c)
Directors’ Interests in the Options of the Company (continued)
2018
Balance at the
start of the year
Balance held at
appointment
Options
exercised
during year
Balance held at
resignation
Balance at
30/06/18
Bal. vested and
exercisable at
30/06/18
No.
No.
No.
No.
No.
No.
Peter Bilbe
Jonathan Price
Peter Hunt
1,790,000
2,750,000
-
Lorry Hughes
2,625,000
-
-
-
-
-
-
-
-
-
-
(150,000)
(2,475,000)
1,790,000
1,790,000
2,750,000
2,750,000
-
-
-
-
Other KMP
Grant Haywood
-
62,500
-
-
62,500
62,500
TOTAL
7,165,000
62,500
(150,000)
(2,475,000)
4,602,500
4,602,500
(d)
Share-Based Compensation
(i)
Performance Rights Issued November 2017
In the year ended 30 June 2018, the Company provided benefits to employees (including directors) of the Company in
the form of share-based payment transactions, whereby performance rights convertible to ordinary shares were granted
at nil consideration as an incentive to improve Director and shareholder goal congruence. See Note 21 for details.
Details of performance rights over ordinary shares in the Company provided as remuneration to the Directors’ of Horizon
Minerals Limited are set out below. When vesting conditions are met, each right is convertible into one ordinary share of
Horizon Minerals Limited.
Year ended 30 June 2019
Balance at beginning of year
unvested
Vested
Lapsed/
cancelled
Balance at end of year unvested
Directors
Value to be
expensed*
$
Value to be
expensed*
$
No.
No.
No.
No.
Value
expensed in
2018/19
$
Value to be
expensed*
$
Peter Bilbe
800,000
54,741
Jonathan Price
2,000,000
136,851
Peter Hunt
800,000
54,741
Other KMP
Grant Haywood
1,000,000
68,426
TOTAL
4,600,000
314,759
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
800,000
2,000,000
800,000
39,054
97,635
39,054
15,687
39,216
15,687
1,000,000
48,817
19,609
4,600,000
224,560
90,199
Year ended 30 June 2018
Granted
Vested
Lapsed/cancelled
Balance at end of year unvested
Directors
No.
Value
$
No.
Value
$
No.
Value
$
No.
Value
expensed
in 2017/18
$
Value to be
expensed*
$
Peter Bilbe
1,025,000
112,855
150,000
21,825
75,000
12,750
800,000
23,539
54,741
Jonathan Price
3,000,000
349,367
666,667
97,000
333,333
56,667
2,000,000
58,849
136,851
Peter Hunt
1,025,000
112,855
150,000
21,825
75,000
12,750
800,000
23,539
54,741
Lorry Hughes
1,450,000
167,000
150,000
25,500
1,300,000
141,500
-
-
-
Other KMP
Grant Haywood
1,750,000
212,750
450,000
63,900
300,000
51,000
1,000,000
29,423
68,426
TOTAL
8,250,000
954,827
1,566,667
230,050
2,083,333
274,667
4,600,000
135,350
314,759
* Maximum value to be expensed in future periods if all vesting conditions are met.
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 3 1
DIRECTORS' REPORT
The performance rights were issued in classes with varying performance and vesting conditions (refer Note 21). Details
of the number of rights issued per class are as follows:
Directors
Class A
Class B
Class C
Class D
Class E
Class F
Class G
No.
No.
No.
No.
No.
No.
No.
Peter Bilbe
75,000
75,000
75,000
400,000
400,000
Jonathan Price
333,333
333,333
333,334 1,000,000
1,000,000
Peter Hunt
75,000
75,000
75,000
400,000
400,000
Lorry Hughes
150,000
150,000
150,000
500,000
500,000
-
-
-
-
Other KMP
Total
No.
-
-
-
-
1,025,000
3,000,000
1,025,000
1,450,000
Grant Haywood
150,000
150,000
150,000
500,000
500,000
150,000
150,000
1,750,000
TOTAL
783,333
783,333
783,334
2,800,000
2,800,000
150,000
150,000
8,250,000
Performance Rights
Further details on the performance and valuations attaching to the performance rights are included in Note 21a to the
Financial Statements.
The fair value of the rights was determined using a Hoadley’s Barrier 1 model. A total amount of $273,377 is included in
the Statement of Financial Performance and Statement of Changes in Equity for the year ended 30 June 2019 (2018 -
$458,725), of which $224,560 (2018 - $365,400) is attributable to KMP.
The assessed fair value at grant date of performance rights granted to the individuals is allocated equally over the period
from grant date to vesting date, and the amount is included in the remuneration tables above. Fair values at grant date
are independently determined using a Hoadley’s Barrier 1 model that takes into account the vesting condition of the
rights, the impact of dilution, the share price at grant date and expected price volatility of the underlying share, the
expected dividend yield and the risk-free interest rate for the term of the rights.
(ii)
Options
During the year ended 30 June 2019, the following options were exercised by Directors. These options were issued in
October 2016 as part of share based compensation.
Director
Peter Bilbe
Number of Options
Date options
exercised
1,750,000
31 July 2018
Jonathan Price
2,500,000
25 July 2018
TOTAL
4,250,000
Exercise Price
Total
$0.125
$0.075
$218,750
$187,500
$406,250
(e)
Other Transactions with Key Management Personnel
There were no other transactions with Key Management Personnel during the year.
This is the end of the Audited Remuneration Report.
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 3 2
DIRECTORS' REPORT
INDEMNIFICATION AND INSURANCE OF DIRECTORS AND OFFICERS
During the financial year, the Group maintained an insurance policy which indemnifies the Directors and Officers of
Horizon Minerals Limited in respect of any liability incurred in connection with the performance of their duties as Directors
or Officers of the Group. The Group's insurers have prohibited disclosure of the amount of the premium payable and the
level of indemnification under the insurance contract.
NON-AUDIT SERVICES
The Directors are satisfied that the provision of non-audit services, during the year, by the auditor or a related practice of
the auditor is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001.
No non-audit services have been provided by the Company’s auditors in year ended 30 June 2019. Remuneration paid
to the Company’s auditors is detailed in Note 18 of this report.
AUDITOR’S INDEPENDENCE DECLARATION
In accordance with section 307C of the Corporations Act 2001, the Directors have obtained a Declaration of
Independence from Rothsay Auditing, the Group’s auditor, as presented on page 34 of this Annual Report.
ENVIRONMENTAL REGULATION
The Group’s exploration and mining operations are subject to environment regulation under the laws of the
Commonwealth and the States. The Company holds exploration/mining tenements in Western Australia, Northern
Territory and Queensland and thus is subject to the Mining Acts of these states, each with specific conditions relating to
environmental management. In some instances bonds are held by the Company’s bank in favour of the Minister for Mines
to be released to the Company when the Minister is satisfied that conditions imposed on tenement licences have been
met. In some jurisdictions Cash Bonds must be lodged with the relevant Department until conditions are fulfilled. Bonds
currently in place in respect of the Company’s tenement holdings are tabulated below.
Tenement Number
Tenement Name
MLs150, 151
White Range
Bond Held $
257,927*
*Pursuant to the White Range Mining Tenement Sale Agreement dated 18 January 2013 the Purchaser Red Dingo
Corporation Pty Ltd is required to replace the Security Bond allowing refund of the current $257,927 to Horizon Minerals
Limited.
The Directors advise that during the year ended 30 June 2019, no claim has been made by any competent authority that
any environmental issues, no condition of license or notice of intent has been breached, and no claim has been made
for increase of bond.
The Directors have considered compliance with the National Greenhouse and Energy Reporting Act 2007 which requires
entities to report annual greenhouse gas emissions and energy use. For the measurement period 1 July 2018 to 30 June
2019 the directors have assessed that there are no current reporting requirements, but may be required to do so in the
future.
PROCEEDINGS ON BEHALF OF COMPANY
No person has applied for leave of Court to bring proceedings on behalf of the Group or intervene in any proceedings to
which the Company is a party for the purpose of taking responsibility on behalf of the Company for all or any part of those
proceedings.
The Group was not a party to any such proceedings during the year.
This report is made in accordance with a resolution of directors, and signed for on behalf of the board by:
JON PRICE
Managing Director
Perth, WA
27 September 2019
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 3 3
AUDITOR’S INDEPENDENCE DECLARATION
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 3 4
DIRECTORS’ DECLARATION
The Directors of the Company declare that, in the opinion of the Directors:
1.
The financial statements, comprising the consolidated statement of comprehensive income, consolidated
statement of financial position, consolidated statement of changes in equity, consolidated statement of cash flows
and accompanying notes, set out on pages 36 to 66 are in accordance with the Corporations Act 2001 including:
(a)
(b)
complying with Accounting Standards and the Corporations Regulations 2001 and other mandatory
professional reporting requirements;
giving a true and fair view of the financial position as at 30 June 2019 and of the performance for the year
ended on that date of the Group; and
The Company has included in the notes to the financial statements an explicit and unreserved Statement of
Compliance with International Financial Reporting Standards.
The Directors have been given the declaration by the Managing Director required by Section 295A.
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.
2.
3.
4.
This declaration is made in accordance with a resolution of the Board of Directors and is signed for and on behalf of the
Directors by:
JON PRICE
Managing Director
Perth, WA
27 September 2019
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 3 5
CONSOLIDATED STATEMENT OF PROFIT OR LOSS
AND OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2019
Continuing Operations
Gold sales
Gold royalty
Interest income
Other income
Total revenue from Continuing Operations
Cost of sales
Exploration and evaluation expenditure
Depreciation expenses
Note
2019
$
2018
$
-
26,729,648
241,406
480,506
58,557
16,916
2,758,203
249,198
3,058,166
27,476,268
2
3
4
(1,719,380)
(21,477,387)
(46,816)
(147,181)
(26,262)
(23,685)
Net decrease in fair value of financial assets at fair value through profit or
loss
9
(622,146)
(208,574)
Employee benefits expense
Share based payments
Building and occupancy costs
Loss on sale of property, plant & equipment
Consultancy and professional fees
Impairment loss on tenements
Scheme of arrangement transaction costs
Other expenses
Profit/(Loss) from continuing operations before income tax
Income tax (expense)/benefit
Profit/(Loss) for the year
Profit/(Loss) for the year and total comprehensive income attributable
to owners of Horizon Minerals Limited
Basic earnings/loss per share
Diluted earnings/loss per share
21
4
12
4
6
(471,051)
(484,615)
(273,377)
(458,725)
(86,303)
(69,117)
(983)
(3,174)
(400,956)
(185,078)
(194,099)
(452,065)
(1,734,427)
-
(617,261)
(445,526)
(3,134,895)
3,521,141
-
-
(3,134,895)
3,521,141
(3,134,895)
3,521,141
2019
2018
17
17
(1.29) cents
1.78 cents
(1.29) cents
1.78 cents
The above Consolidated Statement of Profit or Loss and Other Comprehensive Income should be read in conjunction
with the accompanying notes.
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 3 6
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2019
Current assets
Cash and cash equivalents
Trade and other receivables
Total current assets
Non-current assets
Financial assets at fair value through profit or loss
Other assets
Property, plant and equipment
Exploration, evaluation and development expenditure
Total non-current assets
Total assets
Current liabilities
Trade and other payables
Total current liabilities
Non-current liabilities
Provisions
Total non-current liabilities
Total liabilities
Net assets
Equity
Contributed equity
Reserves
Accumulated losses
Total equity
Note
2019
$
2018
$
7
8
9
10
11
12
4,951,288
10,297,176
557,218
725,481
5,508,506
11,022,657
605,461
1,013,074
257,927
257,927
2,694,350
203,156
37,210,890
13,812,610
40,768,628
15,286,767
46,277,134
26,309,424
13
990,214
2,541,350
990,214
2,541,350
14
2,257,424
100,000
2,257,424
100,000
3,247,638
2,641,350
43,029,496
23,668,074
15a
16a
16b
49,746,534
27,523,594
1,166,406
893,029
(7,883,444)
(4,748,549)
43,029,496
23,668,074
The above Consolidated Statement of Financial Position should be read in conjunction with the accompanying notes.
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 3 7
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2019
Group
Contributed
Equity
Asset
Revaluation
Reserve
Share based
payment
Reserve
Accumulated
Losses
Total Equity
$
$
$
$
$
Balance at 1 July 2017
26,848,742
144,976
539,327
(8,269,690) 19,263,355
Shares issued during the year
Performance rights issued during the year
Shares issue costs
Options issued during the year
Total comprehensive profit/(loss) for the year
441,292
293,949
(60,389)
-
-
-
-
-
-
-
-
164,776
-
43,950
-
-
-
-
441,292
458,725
(60,389)
43,950
-
3,521,141
3,521,141
Balance at 30 June 2018
27,523,594
144,976
748,053
(4,748,549) 23,668,074
Balance at 1 July 2018
27,523,594
144,976
748,053
(4,748,549) 23,668,074
Shares issued during the year
22,261,670
Performance rights issued during the year
Shares issue costs
Options issued during the year
Total comprehensive profit/(loss) for the year
-
(38,730)
-
-
-
-
-
-
-
-
273,377
-
-
-
-
-
-
-
22,261,670
273,377
(38,730)
-
(3,134,895)
(3,134,895)
Balance at 30 June 2019
49,746,534
144,976
1,021,430
(7,883,444) 43,029,496
The above Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying notes.
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 3 8
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2019
Cash flows from operating activities
Receipts from customers
Payments to suppliers and employees
Interest received
Security bonds
Note
2019
$
2018
$
699,036
33,566,998
(5,504,354) (20,540,135)
57,463
17,666
-
55,000
Net cash inflow/(outflow) from operating activities
20a
(4,747,855) 13,099,529
Cash flows from investing activities
Payments for property, plant and equipment
Payments for purchase of tenements
Proceeds from sale of property, plant and equipment
Proceeds from sale of tenements
(10,451)
(1,725)
-
-
(20,000)
18,000
2,500,000
-
Payments for exploration, evaluation and mine development expenditure
(4,504,280)
(6,253,541)
Cash gained on merger with MacPhersons Resources Ltd
Payments for purchase of investments
Net cash inflow/(outflow) from investing activities
Cash flows from financing activities
Proceeds from issues of shares
Proceeds from options exercised
Share issue costs
Net cash (outflow)/inflow from financing activities
Net increase/(decrease) in cash and cash equivalents
592,832
(214,533)
-
-
(1,636,432)
(6,257,266)
-
441,292
1,077,128
-
(38,729)
(16,439)
1,038,399
424,853
(5,345,888)
7,267,116
Cash and cash equivalents at the beginning of the financial year
10,297,176
3,030,060
Cash and cash equivalents at the end of the financial year
7
4,951,288
10,297,176
The above Consolidated Statement of Cash Flows should be read in conjunction with the accompanying notes.
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 3 9
NOTES TO AND FORMING PART OF THE
CONSOLIDATED FINANCIAL STATEMENTS
1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Reporting Entity
This financial report of Horizon Minerals Limited (‘the Company’) for the year ended 30 June 2019 comprises the
Company and its subsidiary (collectively referred to as ‘the Consolidated Entity or the Group’). Horizon Minerals
Limited is a company limited by shares incorporated in Australia whose shares are publicly traded on the
Australian Securities Exchange. The financial report was authorised for issue in accordance with a resolution of
Directors dated 27 September 2019.
The following is a summary of the material accounting policies adopted by the Group in the preparation of the
financial report.
1a
Basis of preparation
These general purpose financial statements have been prepared in accordance with Australian Accounting
Standards, other authoritative pronouncements of the Australian Accounting Standards Board, Australian
Accounting Interpretations and the Corporations Act 2001. The functional and presentation currency of
Horizon Minerals Limited is in Australian Dollars.
Compliance with IFRSs
The financial statements of Horizon Minerals Limited also comply with International Financial Reporting
Standards (IFRSs) as issued by the International Accounting Standards Board (IASB).
New Accounting Standards and Interpretations
In the year ended 30 June 2019, the Company has reviewed all of the new and revised Standards and
Interpretations issued by the AASB that are relevant to its operations and effective for annual reporting
periods beginning on or after 1 July 2018.
Adoption of new and amended accounting standards
A number of new or amended standards became applicable for the current reporting period and the
Company had to change its accounting policies as a result of the adoption of the following standards:
AASB 9 Financial Instruments; and
AASB 15 Revenue from Contracts with Customers.
The impact of the adoption of these standards and the new accounting policies are disclosed below. The
impact of these standards, and the other new and amended standards adopted by the Company, has not
had a material impact on the amounts presented in the Company's financial statements.
AASB 9 Financial Instruments - Impact of Adoption
AASB 9 replaces the provisions of AASB 139 that relate to the recognitions, classification and
measurement of financial assets and financial liabilities, derecognition of financial instruments, impairment
of financial assets and hedge accounting.
The adoption of AASB 9 from 1 July 2018 resulted in no material changes in accounting policies and
adjustments to the amounts recognised in the financial statements. The Company assessed which
business models apply to the financial assets held by the Company and has classified its financial
instruments into the appropriate AASB 9 categories.
There was no impact on the amounts recognised in the financial statements as a result of adoption.
AASB 15 Revenue from Contracts with Customers - Impact of Adoption
The Company has adopted AASB 15 from 1 July 2018 which has no material impact to the amounts
recognised in the financial statements.
New Accounting Standards and Interpretations not yet mandatory or early adopted
Australian Accounting Standards and Interpretations that have recently been issued or amended but are
not yet mandatory, have not been early adopted by the company for the annual reporting period ended 30
June 2019. The company’s assessment of the impact of these new or amended Accounting Standards
and Interpretations, most relevant to the company, are set out below.
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 4 0
NOTES TO AND FORMING PART OF THE
CONSOLIDATED FINANCIAL STATEMENTS
1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
New Accounting Standards and Interpretations not yet mandatory or early adopted (continued)
AASB 16 Leases
This standard is applicable to annual reporting periods beginning on or after 1 January 2019. The standard
replaces AASB 117 'Leases' and for lessees will eliminate the classifications of operating leases and
finance leases. Subject to exceptions, a 'right-of-use' asset will be capitalised in the statement of financial
position, measured as the present value of the unavoidable future lease payments to be made over the
lease term. The exceptions relate to short-term leases of 12 months or less and leases of low-value assets
(such as personal computers and small office furniture) where an accounting policy choice exists whereby
either a 'right-of-use' asset is recognised or lease payments are expensed to profit or loss as incurred. A
liability corresponding to the capitalised lease will also be recognised, adjusted for lease prepayments,
lease incentives received, initial direct costs incurred and an estimate of any future restoration, removal or
dismantling costs. Straight-line operating lease expense recognition will be replaced with a depreciation
charge for the leased asset (included in operating costs) and an interest expense on the recognised lease
liability (included in finance costs). In the earlier periods of the lease, the expenses associated with the
lease under AASB 16 will be higher when compared to lease expenses under AASB 117. However EBITDA
(Earnings Before Interest, Tax, Depreciation and Amortisation) results will be improved as the operating
expense is replaced by interest expense and depreciation in profit or loss under AASB 16. For classification
within the statement of cash flows, the lease payments will be separated into both a principal (financing
activities) and interest (either operating or financing activities) component. For lessor accounting, the
standard does not substantially change how a lessor accounts for leases. The company will adopt this
standard from 1 July 2019 but the impact of its adoption is yet to be assessed by the Company.
The Company has also reviewed all new Standards and Interpretations that have been issued but are not
yet effective for the year ended 30 June 2019. As a result of this review the Directors have determined that
there is no impact, material or otherwise, of the new and revised Standards and Interpretations on its
business and, therefore, no change is necessary to Company accounting policies.
Historical Cost Convention
These financial statements have been prepared under the historical cost convention, as modified by the
revaluation of available-for-sale financial assets.
Critical Accounting Estimates
The preparation of financial statements requires the use of certain critical accounting estimates. It also
requires management to exercise its judgement in the process of applying the Group’s accounting policies.
The areas involving a higher degree of judgement or complexity, or areas where assumptions and
estimates are significant to the financial statements are disclosed in Note 30.
1b
Principles of consolidation
(i)
Subsidiaries
The consolidated financial statements comprise the financial statements of Horizon Minerals
Limited and its controlled entities, Black Mountain Gold Ltd and MacPhersons Resources Limited.
MacPhersons Resources Limited was acquired on 14 June 2019 pursuant to a Scheme of
Arrangement (refer to Note 22) including its subsidiaries (refer Note 25). As at 30 June 2019,
Horizon Minerals Limited and its subsidiaries together are referred to in this financial report as the
Consolidated Entity or the Group.
Control exists where the Company has the capacity to dominate the decision-making in relation to
the financial and operating policies of another entity so that the other entity operates with the
Company to achieve the objectives of the Company. All inter-company balances and transactions
between entities in the Group, including any unrealised profits and losses have been eliminated on
consolidation. Non-controlling interests in the results and equity of the consolidated entities are
shown separately in the consolidated statement of comprehensive income and consolidated
statement of financial position respectively.
Where control of an entity is obtained during a financial year, its results are included in the
consolidated statement of comprehensive income from the date on which control commences. They
are de-consolidated from the date that control ceases.
(ii)
Joint ventures
Joint ventures entered into are not separate legal entities but rather are contractual arrangements
between the participants for the sharing of costs and output and do not in themselves generate
revenue and profit. Details of the joint ventures are set out in Note 30.
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 4 1
NOTES TO AND FORMING PART OF THE
CONSOLIDATED FINANCIAL STATEMENTS
1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
1c
Income tax
The income tax expense or revenue for the period is the tax payable on the current period’s taxable income
based on the national income tax rate for each jurisdiction adjusted by changes in deferred tax assets and
liabilities attributable to temporary differences between the tax bases of assets and liabilities and their
carrying amounts in the financial statements, and to unused tax losses.
Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected to
apply when the assets are recovered or liabilities are settled, based on those tax rates which are enacted
or substantively enacted for each jurisdiction. The relevant tax rates are applied to the cumulative amounts
of deductible and taxable temporary differences to measure the deferred tax asset or liability. An exception
is made for certain temporary differences arising from the initial recognition of an asset or a liability. No
deferred tax asset or liability is recognised in relation to these temporary differences if they arose in a
transaction, other than a business combination, that at the time of the transaction did not affect either
accounting profit or taxable profit or loss.
Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is
probable that future taxable amounts will be available to utilise those temporary differences and losses.
Deferred tax liabilities and assets are not recognised for temporary differences between the carrying
amount and tax bases of investments in controlled entities where the parent is able to control the timing of
the reversal of the temporary differences and it is probable that the differences will not reverse in the
foreseeable future.
Current and deferred tax balances attributable to amounts recognised directly in other comprehensive
income/equity are also recognised directly in other comprehensive income/equity.
The charge for current income tax expense is based on the profit for the year adjusted for any non-
assessable or disallowed items. It is calculated using the tax rates that have been enacted or are
substantially enacted by the reporting date.
The amount of benefits brought to account or which may be realised in the future is based on the
assumption that no adverse change will occur in income taxation legislation and the anticipation that the
economic entity will derive sufficient future assessable income to enable the benefit to be realised and
comply with the conditions of deductibility imposed by the law.
The Group is consolidated for income tax purposes effective 1 July 2016.
1d
Revenue recognition
Revenue is measured at the fair value of the consideration received or receivable. Amounts disclosed as
revenue are net of returns, trade allowances and amounts collected on behalf of third parties. Revenue is
recognised for major business activities as follows:
(i)
Sale of gold
Revenue from the sale of goods is measured at the fair value of the consideration received or
receivable. Revenue is recognised when the significant risk and rewards of ownership have been
transferred to the buyer, recovery of the consideration is probable, the associated costs and
possible return of goods can be estimated reliably and the amount of revenue can be measured
reliably.
(ii)
Interest income
Interest revenue is recognised on a proportional basis taking into account the interest rates
applicable to the financial assets.
(iii) Other services
Other debtors are recognised at the amount receivable and are due for settlement within 30 days
from the end of the month in which services were provided.
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 4 2
NOTES TO AND FORMING PART OF THE
CONSOLIDATED FINANCIAL STATEMENTS
1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
1e
Mineral prospects and exploration expenditure thereon
The Group’s policy with respect to exploration expenditure is to write off all costs unless the directors and
management are of the view that there is a reasonable prospect that the costs may be recovered in future
income years. Costs that may reasonably be expected to be recovered are capitalised to the statement of
financial position as a non-current asset and accumulated separately for each area of interest. Such
expenditure comprises net direct cash and where applicable, an apportionment of related overhead
expenditure.
Each area of interest is limited to a size related to a known or probably mineral resource capable of
supporting a mining operation. Expenditure is not carried forward in respect of any area of interest unless
the Group’s right to tenure to that area of interest is current.
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. At 30 June 2019, the Directors considered that the
carrying value of the mineral tenement interests of the Group was as shown in the accounts and did not
need adjusting.
Exploration and evaluation assets are transferred to Development Phase assets once technical feasibility
and commercial viability of an area of interest is demonstrable. Exploration and evaluation assets are
tested for impairment, and any impairment loss is recognised, prior to being reclassified.
1f
Mine properties and mining assets
Mine properties represents the acquisition cost and/or accumulated exploration, evaluation and
development expenditure in respect of areas of interest in which mining has commenced.
Mine development costs are deferred until commercial production commences. When commercial
production is achieved mine development is transferred to mine properties, at which time it is amortised
on a unit of production basis based on ounces mined over the total estimated resources related to this
area of interest.
Significant factors considered in determining the technical feasibility and commercial viability of the project
are the completion of a feasibility study, the existence of sufficient resources to proceed with development
and approval by the board of Directors to proceed with development of the project.
Deferred stripping costs
Stripping is the process of removing overburden and waste materials from surface mining operations to
access the ore. Stripping costs are capitalised during the development of a mine and are subsequently
amortised over the life of mine on a units of production basis, where the unit of account is ounces of gold
sold.
1g
Non-derivative financial assets existing on or acquired after 1 July 2009
The classification and measurement model for financial assets existing on or acquired after 1 July 2009,
the date the Group adopted AASB 9, is outlined below.
Financial assets at amortised cost and the effective interest rate method
A financial asset is measured at amortised cost if the following conditions are met:
the objective of the Group’s business model is to hold the asset to collect contractual cash flows;
the contractual cash flows give rise, on specified dates, to cash flows that are solely payments of
principal and interest on the principal outstanding; and
the group does not irrevocably elect at initial recognition to measure the instrument at fair value through
profit or loss to minimise an accounting mismatch.
Amortised cost instruments are recognised initially at fair value plus any directly attributable transaction
costs. Subsequent to initial recognition the carrying amount of amortised cost instruments is determined
using the effective interest method, less any impairment losses.
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 4 3
NOTES TO AND FORMING PART OF THE
CONSOLIDATED FINANCIAL STATEMENTS
1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
1g
Non-derivative financial assets existing on or acquired after 1 July 2009 (continued)
Financial assets at fair value through profit or loss
Financial assets other than equity instruments that do not meet the above amortised cost criteria are
measured at fair value through profit or loss. This includes financial assets that are held for trading and
investments that the Group manages based on their fair value in accordance with the Group’s documented
risk management and/or investment strategy.
Equity instruments are measured at fair value through profit or loss unless the Group irrevocably elects at
initial recognition to present the changes in fair value in other comprehensive income as described below.
Upon initial recognition, financial assets measured at fair value through profit or loss are recognised at fair
value and any transaction costs are recognised in profit or loss when incurred. Subsequent to initial
recognition, financial assets at fair value through profit or loss are measured at fair value, and changes
therein are recognised in profit or loss.
1h
Impairment of assets
Mining tenements assets and other intangible assets that have an indefinite useful life are not subject to
amortisation and are tested annually for impairment, or more frequently if events or changes in
circumstances indicate that they might be impaired. Other assets are reviewed for impairment whenever
events or changes in circumstances indicate that the carrying amount may not be recoverable. An
impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable
amount. The recoverable amount is the higher of an asset's fair value less costs to sell and value in use.
For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are
separately identifiable cash inflows which are largely independent of the cash flows from other assets or
groups of assets (cash-generating units). Non-financial assets other than goodwill that suffered
impairment are reviewed for possible reversal of the impairment at each reporting date.
1i
Plant and equipment
Plant and equipment is stated at historical cost less depreciation and impairment. Historical cost includes
expenditure that is directly attributable to the acquisition of the items.
Subsequent costs are included in the asset's carrying amount or recognised as a separate asset, as
appropriate, only when it is probable that future economic benefits associated with the item will flow to the
Group and the cost of the item can be measured reliably. All other repairs and maintenance are charged
to profit and loss during the financial period in which they are incurred.
Depreciation is calculated on a diminishing value basis to write off the net cost of each item of plant and
equipment over its expected useful life to the Group. The expected useful lives are as follows:
Plant and equipment 5 - 10 years.
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each reporting
date. An asset's carrying amount is written down immediately to its recoverable amount if the asset's
carrying amount is greater than its estimated recoverable amount (Note 1h).
Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are
included in the profit and loss.
1j
Trade receivables
Trade receivables are recognised initially at fair value and subsequently measured at amortised cost, less
provision for doubtful debts. Trade receivables are due for settlement no more than 30 days from the date
of recognition.
Collectability of trade receivables is reviewed on an ongoing basis. Debts that are known to be
uncollectible are written off. An allowance account (provision for impairment of trade receivables) is
established when there is objective evidence that the Group will not be able to collect all amounts due
according to the original terms of receivables. The amount of the provision is recognised in the profit and
loss.
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 4 4
NOTES TO AND FORMING PART OF THE
CONSOLIDATED FINANCIAL STATEMENTS
1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
1k
Trade and other payables
These amounts represent liabilities for goods and services provided to the Group prior to the end of the
financial year and which are unpaid, together with assets ordered before the end of the financial year. The
amounts are unsecured and are usually paid within 30 days of recognition.
1l
Employee benefits
(i)
Wages and salaries, annual leave and sick leave
Liabilities for wages and salaries, including non-monetary benefits and annual leave expected to
be settled within 12 months of the reporting date are recognised in other payables in respect of
employees’ services up to the reporting date and are measured at the amounts expected to be paid
when the liabilities are settled.
Annual leave has been accrued as at 30 June 2019.
(ii)
Long service leave
The liability for long service leave is recognised in the provision for employee benefits and
measured as the present value of expected future payments to be made in respect of services
provided by employees up to the reporting date using the projected unit credit method.
Consideration is given to expected future wage and salary levels, experiences of employee
departures and periods of service. Expected future payments are discounted using market yields
at the reporting date on national government bonds with terms to maturity and currency that match,
as closely as possible, the estimated future cash outflows.
Long service leave has been accrued as at 30 June 2019.
(iii)
Share-based payments
Share-based compensation benefits are provided to directors through the granting of options and
performance rights.
The fair value of options and performance rights granted by the Group are recognised as an
employee benefits expense with a corresponding increase in equity. The total amount to be
expensed is determined by reference to the fair value of the options and performance rights
granted, which includes any market performance conditions but excludes the impact of any service
and non-market performance vesting conditions and the impact of any non-vesting conditions.
Non-market vesting conditions are included in assumptions about the number of options and
performance rights that are expected to vest. The total expense is recognised over the vesting
period, which is the period over which all of the specified vesting conditions are to be satisfied. At
the end of each period, the entity revises its estimates of the number of options that are expected
to vest based on the non-marketing vesting conditions. It recognises the impact of the revision to
original estimates, if any, in profit or loss, with a corresponding adjustment to equity.
1m Cash and cash equivalents
For statement of cashflows presentation purposes, cash and cash equivalents includes cash on hand,
deposits held at call with financial institutions, other short-term, highly liquid instruments with original
maturities of three months or less that are readily convertible to known amounts of cash and which are
subject to an insignificant risk of changes in value, and bank overdrafts. Bank overdrafts are shown within
borrowings in current liabilities on the statement of financial position.
1n
Borrowings
Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are
subsequently measured at amortised cost. Any difference between the proceeds (net of transaction costs)
and the redemption amount is recognised in the profit and loss over the period of the borrowings using the
effective interest method. Fees paid on the establishment of loan facilities, which are not incremental costs
relating to the actual draw-down of the facility, are recognised as prepayments and amortised on a straight-
line basis over the term of the facility.
Borrowings are classified as current liabilities unless the Group has an unconditional right to defer
settlement of the liability for at least 12 months after the reporting date.
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 4 5
NOTES TO AND FORMING PART OF THE
CONSOLIDATED FINANCIAL STATEMENTS
1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
1o
Leases
Leases of property, plant and equipment where the entity has substantially all the risks and rewards of
ownership are classified as finance leases. Finance leases, including hire purchase agreements, are
capitalised at the lease's inception at the lower of fair value of the leased property and the present value
of the minimum lease payments. The corresponding rental obligations, net of finance charges, are
included in other long-term payables. Each lease payment is allocated between the liability and finance
cost. The finance cost is charged to the profit and loss over the lease period so as to produce a constant
periodic rate of interest on the remaining balance of the liability for each period. The property, plant and
equipment acquired under finance leases is depreciated over the shorter of the asset's useful life and the
lease term.
Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are
classified as operating leases. Payments made under operating leases (net of any incentives received
from the lessor) are charged to the profit and loss on a straight-line basis over the period of the lease.
1p
Fair value estimation
The fair value of financial assets and financial liabilities must be estimated for recognition and
measurement or for disclosure purposes.
The fair value of financial instruments traded in active markets (such as publicly traded derivatives, and
trading and available-for-sale securities) is based on quoted market prices at the reporting date. The
quoted market price used for financial assets held by the Company is the current bid price: the appropriate
quoted market price for financial liabilities is the current ask price.
The nominal value less estimated credit adjustments of trade receivables and payables are assumed to
approximate their fair values.
1q
Goods and services tax
Revenues, expenses and assets are recognised net of the amount of associated goods and services tax
(GST), unless the GST incurred is not recoverable from the taxation authority. In this case it is recognised
as part of the cost of acquisition of the asset or as part of the expense.
Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net
amount of GST recoverable from, or payable to, the taxation authority is included with other receivables or
payables in the statement of financial position.
Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or
financing activities which are recoverable from, or payable to, the taxation authority, are presented as
operating cash flows.
1r
Contributed equity
Ordinary shares are classified as equity.
Incremental costs directly attributable to the issue of new shares or options are shown in equity as a
deduction from the proceeds. Incremental costs directly attributable to the issue of new shares or options
for the acquisition of a business are not included in the cost of acquisition as part of the purchase
consideration.
If the entity reacquires its own equity instruments, e.g. as the result of a share buy-back, those instruments
are deducted from equity and the associated shares are cancelled. No gain or loss is recognised in the
profit or loss and the consideration paid including any directly attributable incremental costs (net of income
taxes) is recognised directly in equity.
1s
Provisions
Provisions for legal claims recognised when the Group has a present legal obligation as a result of past
events, it is probable that an outflow of resources will be required to settle the obligation, and the amount
has been reliably estimated. Provisions are not recognised for future operating losses.
Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement
is determined by considering the class of obligations as a whole. A provision is recognised even if the
likelihood of an outflow with respect to any one item included in the same class of obligations may be
small.
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 4 6
NOTES TO AND FORMING PART OF THE
CONSOLIDATED FINANCIAL STATEMENTS
1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
1s
Provisions (continued)
Provisions are measured at the present value of management's best estimate of the expenditure required
to settle the present obligation at the reporting date. The discount rate used to determine the present value
reflects current market assessments of the time value of money and the risks specific to the liability.
1t
Segment reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief
operating decision maker. The chief operating decision maker has been identified as the steering
committee that makes strategic decisions.
1u
Borrowing costs
Borrowing costs incurred for the construction of any qualifying asset are capitalised during the period of
time that is required to complete and prepare the assets for its intended use or sale. Other borrowing costs
are expensed.
1v
Earnings per share
(i)
(ii)
Basic earnings per share
Basic earnings per share is calculated by dividing the profit attributable to equity holders of the
Company by the weighted average number of ordinary shares outstanding during the financial year,
adjusted for bonus elements in ordinary shares issued during the year.
Diluted earnings per share
Diluted earnings per share adjusted the figures used in the determination of basic earnings per
share to take into account the after income tax effect of interest and other financing costs associated
with dilutive potential ordinary shares and the weighted average number of shares assumed to have
been issued for no consideration in relation to dilutive potential ordinary shares.
1w
Rehabilitation costs
The Group’s mining, extraction and processing activities give rise to obligations for site rehabilitation.
Rehabilitation obligations can include facility decommissioning and dismantling; removal or treatment of
waste materials; land rehabilitation; and site restoration. The extent of work required and the associated
costs are estimated based on feasibility estimates using current restoration standards and techniques.
Provisions for the cost of each rehabilitation program are recognised at the time that environmental
disturbance occurs.
Rehabilitation provisions are initially measured at the expected value of future cash flows required to
rehabilitate the relevant site.
At each reporting date the rehabilitation liability is re-measured to account for any new disturbance,
updated cost estimates, changes to the estimated lives of operations and new regulatory requirements.
1x
Business combinations
The acquisition method of accounting is used to account for all business combinations, including business
combinations involving entities or business under common control, regardless of whether equity
instruments or other assets are acquired. The consideration transferred for the acquisition of a subsidiary
comprises the fair value of the assets transferred, the liabilities incurred, and the equity interests issued by
the Group. The consideration transferred also includes the fair value of any contingent consideration
arrangement and the fair value of any pre−existing equity interest in the subsidiary. Acquisition−related
costs are expensed as incurred. Identifiable assets acquired, and liabilities and contingent liabilities
assumed in a business combination are, with limited exceptions, measured initially at their fair values at
the acquisition date. The excess of the consideration transferred, the amount of any non−controlling
interest in the acquiree and the acquisition−date fair value of any previous equity interest in the acquiree
over the fair value of the Group’s share of the net identifiable assets acquired is recorded as goodwill. If
those amounts are less than the fair value of the net identifiable assets of the subsidiary acquired and the
measurement of all amounts has been reviewed, the difference is recognised directly in profit or loss as a
bargain purchase.
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 4 7
NOTES TO AND FORMING PART OF THE
CONSOLIDATED FINANCIAL STATEMENTS
1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
1x
Business combinations (continued)
If the initial accounting for a business combination is incomplete by the end of the reporting period in which
the combination occurs, the Group reports provisional amounts for the items for which the accounting is
incomplete. These provisional amounts are adjusted during the measurement period (see above), or
additional assets or liabilities recognised, to reflect new information obtained about facts and
circumstances that existed as of the acquisition date that, if known, would have affected the amounts
recognised as of that date.
2 INTEREST INCOME
3
OTHER INCOME
Profit on sale of tenement interest
Recovery of administration costs
Other income
4
EXPENSES
Profit/(loss) before income tax includes the following specific expenses:
Cost of sales
Mining and processing costs*
Amortisation
Cost of sales
Building and occupancy costs
Rental expense related to office lease
Other
Building and occupancy costs
Scheme of Arrangement transaction costs (refer Note 22)
* Mining and processing costs for year ended 30 June 2019 includes balance
of monies paid in settlement of mining dispute as per ASX announcement
dated 19 December 2018, net of amounts previously set aside. Refer to Note
26(d).
2019
$
2018
$
58,557
16,916
2,500,000
-
120,526
89,834
137,677
159,364
2,758,203
249,198
1,719,380
17,447,391
-
4,029,996
1,719,380
21,477,387
70,495
15,808
86,303
1,734,427
69,117
-
69,117
-
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 4 8
NOTES TO AND FORMING PART OF THE
CONSOLIDATED FINANCIAL STATEMENTS
5
SEGMENT INFORMATION
Management has determined the operating segments based on the reports
reviewed by the Board that are used to make strategic decisions.
The Board considers that the reportable segments are defined by the nature
of the exploration activities. As such there are two reportable segments
being Vanadium/Molybdenum tenements and Gold tenements.
2019
Revenue
Profit/(loss) before income tax
Vanadium/
Molybdenum
$
Gold
$
Total
$
-
-
241,406
241,406
(2,571,306)
(2,571,306)
Total segment assets
756,367
44,915,306
45,671,673
2018
Revenue
Profit/(loss) before income tax
Vanadium/
Molybdenum
$
Gold
$
Total
$
-
-
27,210,154
27,210,154
3,463,601
3,463,601
Total segment assets
756,367
24,539,983
25,296,350
5a
Segment revenue
Segment revenue reconciles to revenue from continuing operations as follows:
Segment revenue
Interest revenue
Other revenue
Revenue from continuing operations
5b
Segment profit/(loss)
2019
$
2018
$
241,406
27,210,154
58,557
16,916
2,758,203
249,198
3,058,166
27,476,268
Segment profit/(loss) reconciles to total comprehensive income as follows:
Segment profit/(loss) before income tax
Interest revenue
(2,571,306)
3,463,601
58,557
16,916
Net decrease in value of financial assets at fair value through profit & loss
(622,146)
(208,574)
Unallocated costs net of other revenue
Profit/(Loss) after income tax
-
249,198
(3,134,895)
3,521,141
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 4 9
NOTES TO AND FORMING PART OF THE
CONSOLIDATED FINANCIAL STATEMENTS
2019
$
2018
$
45,671,673 25,296,350
605,461
1,013,074
46,277,134 26,309,424
5
5c
SEGMENT INFORMATION (CONTINUED)
Segment assets
Segment assets reconcile to total assets as follows:
Segment assets
Unallocated assets
Total assets
5d
Segment liabilities
The Group’s liabilities are not reported to management on an individual
segment basis, but rather reported on a consolidated basis.
6
6a
INCOME TAX
The prima facie income tax expense on pre-tax accounting loss
reconciles to the income tax expense in the financial statements as
follows:
Profit/(Loss) from continuing operations before income tax expense
(3,134,895)
3,521,141
Income tax expense/(benefit) calculated at 27.5% (2018: 30%)
(862,096)
1,056,342
Capital raising cost allowable
(36,776)
(37,796)
(898,872)
1,018,546
Movements in unrecognised timing differences
308,278
111,753
Expenses that are not deductible in determining taxable profit
325,532
-
Movement in share revaluations
Tax losses recouped
Unused tax losses not recognised as a deferred tax asset
Income tax benefit reported in the Statement of Profit or Loss and Other
Comprehensive Income
171,090
62,572
-
(1,192,871)
93,972
-
-
-
6b
Unrecognised deferred tax balances:
The following deferred tax assets (2019: 27.5%, 2018: 30%) have not been
brought to Account:
Unrecognised deferred tax asset – tax losses
Unrecognised deferred tax asset – capital losses
3,073,250
3,108,944
15,563
16,978
Unrecognised deferred tax liability – capitalised exploration expenses
(3,592,398)
(3,918,979)
Unrecognised deferred tax asset/(liability) – share investments
Unrecognised deferred tax asset – other temporary differences
234,698
88,246
69,390
69,195
Net deferred tax assets/(liability) not brought to account
(180,641)
(654,472)
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 5 0
NOTES TO AND FORMING PART OF THE
CONSOLIDATED FINANCIAL STATEMENTS
2019
$
2018
$
6
6c
INCOME TAX (CONTINUED)
The taxation benefits of tax losses and timing not brought to account will only
be obtained if:
assessable income is derived of a nature and of amount sufficient to
enable the benefit from the deductions to be realised;
conditions for deductibility imposed by the law are complied with; and
no changes in tax legislation adversely affect the realisation of the benefit
from the deductions.
6d
In June 2019, Horizon acquired 100% of the issued capital of MacPhersons
Resources Ltd and its subsidiaries – Refer Note 22 for details.
As at that date, it is estimated that MacPhersons Resources Ltd and its
subsidiaries had approx. $17m of unrecognised tax losses that have not been
brought to account as an asset.
The group is currently assessing these losses to determine the extent to which
these losses are available to be recouped from future assessable income.
7
CASH AND CASH EQUIVALENTS
Cash at bank and on hand
4,951,288
10,297,176 *
Reconciliation to cash at the end of the year
The above figures are reconciled to cash at the end of the financial year as
shown in the cash flow statement as follows:
Balances as above
Balances per statement of cash flows
4,951,288
10,297,176
4,951,288
10,297,176
* Included within this amount are the IRC & RM Joint Venture Accounts totalling
$7,823,573, payments from which require authorisation by each of the joint venture
parties and as such may be termed restricted cash. This account is to be used to pay
out the profit share of the Teal project to the joint venture parties (refer notes 13, 26(d)
and 31).
8
TRADE AND OTHER RECEIVABLES
Trade receivables
Other receivables – GST refund
Prepayment and other receivables
Accrued interest
Term deposit – bonds & credit card security deposit
423,690
483,553
76,740
205,977
38,367
18,624
1,321
227
17,100
17,100
557,218
725,481
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 5 1
NOTES TO AND FORMING PART OF THE
CONSOLIDATED FINANCIAL STATEMENTS
2019
$
2018
$
8
TRADE AND OTHER RECEIVABLES (CONTINUED)
There are no receivables past due but not impaired.
There are no impaired trade receivables or any allowance for impairment
against trade receivables.
Term deposits
The deposits have maturity periods of between 3 and 12 months, but can be
readily convertible to cash at short notice, at interest rates between 2.4% and
2.5% (2018: 2.4% and 2.5%). Refer to Note 27 regarding risk exposures. Term
deposits with a maturity over three months are included in current receivables.
Effective interest rates and credit risk
Information concerning the effective interest rate and credit risk of both current
and non-current receivables is set out below.
Interest rate risk
All receivable balances are non-interest bearing.
Credit rate risk
There is no concentration of credit risk with respect to current and non-current
receivables. Refer to Note 27 for further information on the Group’s risk
management policies. Due to short term nature, fair value approximates
carrying value.
9
FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS
Shares in listed companies at market value
605,461
1,013,074
605,461
1,013,074
Included is $605,461 (2018: $1,013,074) of shares and options held in Reward
Minerals Ltd.
The net change in fair value on financial assets at fair value through profit or
loss for the year was a loss of $622,146 (2018 Loss: $208,574).
All financial assets at fair value through profit or loss are denominated in
Australian currency. Refer to Note 27 for further information concerning the
price and foreign currency risk.
10
OTHER ASSETS
Security deposits
257,927
257,927
257,927
257,927
The security deposits arise from monies held in trust accounts or lodged with
appropriate authorities in relation to mining tenements held. The Group has restricted
access to these funds, but they are expected to be reimbursed in the future
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 5 2
NOTES TO AND FORMING PART OF THE
CONSOLIDATED FINANCIAL STATEMENTS
11
PROPERTY, PLANT & EQUIPMENT
Plant and equipment at cost
Accumulated depreciation and impairment
Total plant and equipment
Property at cost
Accumulated depreciation and impairment
Total property
Motor vehicles – at cost
Accumulated depreciation
Total motor vehicles
RECONCILIATIONS
11a Plant and equipment
Carrying amount at beginning of the year
Additions
Additions acquired under Scheme of Arrangement
Disposals
Depreciation
Carrying amount at end of year
11b Property
Carrying amount at beginning of the year
Additions acquired under Scheme of Arrangement
Depreciation
Carrying amount at end of year
11c Motor Vehicle
Carrying amount at beginning of year
Additions
Additions acquired under Scheme of Arrangement
Depreciation
Carrying amount at end of year
2019
$
2018
$
4,532,147
1,171,840
(2,190,256)
(1,062,230)
2,341,891
109,610
518,054
96,348
(210,989)
(2,802)
307,065
93,546
324,544
(279,150)
45,394
-
-
-
2,694,350
203,156
109,610
152,249
10,452
1,725
2,253,892
(9,877)
(22,186)
-
(20,679)
(23,685)
2,341,891
109,610
93,546
216,889
(3,370)
307,065
94,040
-
(494)
93,546
-
-
46,100
(706)
45,394
-
-
-
-
-
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 5 3
NOTES TO AND FORMING PART OF THE
CONSOLIDATED FINANCIAL STATEMENTS
12
EXPLORATION, EVALUATION AND DEVELOPMENT EXPENDITURE
During the year ended 30 June 2019, the Group incurred and capitalised the
following exploration, evaluation and development expenditure:
Exploration and e valuation phase
Carrying amount at beginning of the year
Capitalised during the year
Transferred to production phase
2019
$
2018
$
12,717,664
9,630,270
3,736,124
3,519,459
-
-
Tenements acquired under Scheme of Arrangement
19,115,999
Purchases of tenements
Impairment loss on tenements
Carrying amount at end of year
Mine properties
Carrying amount at beginning of the year
Transfer from exploration and evaluation phase
Capitalised during the year
Amortised during the year
Carrying amount at end of year
Total exploration and mine properties
-
20,000
(194,099)
(452,065)
35,375,688
12,717,664
1,094,946
4,535,863
-
-
740,256
589,079
-
(4,029,996)
1,835,202
1,094,946
37,210,890
13,812,610
Impairment of mining tenements
An impairment loss of $194,099 (2018: Loss $452,065) has been recorded
against the mining tenements as at 30 June 2019 to reduce the carrying
value to what is anticipated to be at least the market value of the tenements.
The ultimate recoupment of expenditure above relating to the exploration
and evaluation phase is dependent upon the successful development and
commercial exploitation, or alternatively, sale of the respective areas of
interest.
13
TRADE AND OTHER PAYABLES
Trade payables
Accrued expenses
Amount payable under profit share agreement
Accrued employee entitlements
14
PROVISIONS
Rehabilitation of mine site
Stamp duty
26d &
31
669,320
155,992
298,343
180,726
-
1,931,355
164,902
130,926
990,214
2,541,350
1,057,424
100,000
1,200,000
-
2,257,424
100,000
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 5 4
NOTES TO AND FORMING PART OF THE
CONSOLIDATED FINANCIAL STATEMENTS
2019
No.
2018
No.
2019
$
2018
$
15
CONTRIBUTED EQUITY
15a Share capital
At the beginning of the year
227,192,119
218,412,952 27,523,594
26,848,742
Shares issued under Scheme of Arrangement
192,586,736
- 21,184,541
-
Options conversion
8,196,345
3,345,834
1,077,129
331,292
Shares issued for performance rights
Part payments for subscription of shares*
Capital raising costs
-
-
-
2,016,667
3,416,666
-
-
293,949
110,000
-
(38,730)
(60,389)
Total Contributed Equity
427,975,200
227,192,119 49,746,534
27,523,594
* During the year ended 30 June 2017 Intermin and AXF Resources Pty Ltd (AXF) executed a Joint Venture agreement under which
AXF is to subscribe for $430,000 Intermin shares at 12 cents as announced on 13 December 2016. As at 30 June 2017 $300,000 had
been received with 166,667 shares issued. Intermin issued the remaining 3,416,666 shares when final payment of $110,000 was
received.
15b Terms and conditions of contributed equity
Ordinary shares
Ordinary shares have no par value. Ordinary shares have the right to receive dividends as declared and, in the
event of winding up the Company, to participate in the proceeds from the sale of all surplus assets in proportion
to the number of and amounts paid up on shares held. Ordinary shares entitle their holder to one vote, either in
person or by proxy, at a meeting of the Company.
15c Options
Exercise Price
Expiry date
Listed
Options
No.
Unlisted
Options
No.
Unlisted
Options
No.
Unlisted
Options
No.
Unlisted
Options No.
Unlisted
Options No
Total
No.
$0.17
$0.075
$0.125
$0.25
$0.2912
$0.6988
31 Aug 2018
31 Jul 2018
31 Jul 2018
31 Aug 2019
9 Dec 2019
28 Feb 2020
Balance at 1 July 2018
24,620,579
2,500,000
1,750,000
500,000
-
-
29,370,579
Issued under Scheme of
Arrangement
-
Expired during the year
(20,674,234)
-
-
-
-
Exercised during the year
(3,946,345)
(2,500,000)
(1,750,000)
-
-
-
2,743,184
219,456
2,962,640
-
-
-
-
(20,674,234)
(8,196,345)
Balance at 30 June 2019
-
-
-
500,000
2,743,184
219,456
3,462,640
Balance at 1 July 2017
23,674,747
5,000,000
1,750,000
-
Issued during the year
1,791,666
-
Exercised during the year
(845,834)
(2,500,000)
-
-
500,000
-
Balance at 30 June 2018
24,620,579
2,500,000
1,750,000
500,000
-
-
-
-
-
-
-
-
30,424,747
2,291,666
(3,345,834)
29,370,579
15d Performance Rights
As at 30 June 2019, there were 5,600,000 performance rights on issue that, if the vesting conditions are met,
could result in the issue of 5,600,000 ordinary shares in the Company. Further details are contained in Note 21.
.
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 5 5
NOTES TO AND FORMING PART OF THE
CONSOLIDATED FINANCIAL STATEMENTS
16
RESERVES AND ACCUMULATED LOSSES
16a
(i) Asset revaluation reserve
Opening balance
Closing Balance
(ii) Share based payments reserve
Opening balance
Performance rights issued during the year
Performance rights converted to issued capital upon vesting
Options placement in lieu of services provided
Closing Balance
Total Reserves
16b Accumulated losses
Opening balance
Profit/ (loss) for the year
Closing balance
Asset Revaluation Reserve
The Asset Revaluation Reserve is used to record increments and
decrements on the revaluation of non-current assets.
Share Based Payments Reserve
The Share Based Payments Reserve is used to recognise the fair value
of shares, options and performance rights granted as remuneration.
17
EARNINGS PER SHARE
Operating profit/(loss) after tax attributable to members of Horizon
Minerals Limited
Basic earnings (loss) per share
Diluted earnings (loss) per share
Weighted average number of ordinary shares outstanding during the
year used in the calculation of basic earnings per share.
18
REMUNERATION OF AUDITORS
Remuneration for audit services and review of the financial reports of
the parent entity or any entity in the Group to Rothsay Auditing. No other
fees were paid or payable for services provided by the auditor of the
parent, related practices or non-related audit firms.
Rothsay Auditing
2019
$
2018
$
144,976
144,976
144,976
144,976
748,053
539,327
273,377
458,725
-
-
(293,949)
43,950
1,021,430
748,053
1,166,406
893,029
(4,748,549)
(8,269,690)
(3,134,895)
3,521,141
(7,883,444)
(4,748,549)
(3,134,895)
3,521,141
(1.29) cents
1.78 cents
(1.29) cents
1.78 cents
Number
Number
243,487,887
198,201,638
2019
$
2018
$
41,500
41,500
35,750
35,750
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 5 6
NOTES TO AND FORMING PART OF THE
CONSOLIDATED FINANCIAL STATEMENTS
19
KEY MANAGEMENT PERSONNEL DISCLOSURES
19a Details of remuneration
Short-term benefits
Post-employment benefits
Share based payments
20 STATEMENT OF CASH FLOWS
20a
Reconciliation of net cash from operating activities to Profit/(Loss)
after income tax
Operating Profit/(Loss) after income tax
Depreciation
Amortisation of mine development expenditure
Net change in fair values of financial assets at fair value through profit or
loss
Profit on sale of tenement
(Gain)/loss on disposal of plant and equipment
Impairment loss on tenements
Share based payment
Other
Movement in assets and liabilities:
Provisions
Receivables
Prepayments
Security Bonds
Trade creditors and accruals
Net cash inflow/(outflow) from operating activities
21
SHARE BASED PAYMENTS
21a Year ended 30 June 2019
2019
$
2018
$
829,124
765,617
72,702
74,934
224,560
365,400
1,126,386
1,205,951
(3,134,895)
3,521,141
26,262
23,685
-
4,029,996
622,146
208,574
(2,500,000)
-
983
3,174
194,099
452,065
273,377
458,725
(20,257)
1,154,728
-
-
307,712
5,902,420
(841)
-
(2,316)
55,000
(1,671,169)
(1,552,935)
(4,747,855)
13,099,529
In November 2017, directors and employees were granted 10,000,000 performance rights.
The performance rights were granted at nil consideration, do not have an exercise price and will lapse if the
vesting conditions are not met.
The Performance Rights are issued under the Intermin Resources Employee Incentive Scheme (EIS) approved
by shareholders at the General Meeting held of 17 October 2016. The issue to Directors was approved at the
Annual General Meeting on 23 November 2017.
Each Performance Right will, at the election of the holder, vest and convert to one fully paid ordinary share, subject
to the satisfaction of certain Performance Conditions.
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 5 7
NOTES TO AND FORMING PART OF THE
CONSOLIDATED FINANCIAL STATEMENTS
21a Year ended 30 June 2019 (continued)
The Performance Conditions are:
1.
2.
3.
4.
5.
6.
7.
Class A Performance Rights – Prior to 1 July 2018 a feasibility study on the Goongarrie Lady Project is completed
projected to deliver more than $8,000,000 net cash flow and the total JORC resource increases to result in an
estimate of more than 710,000 ounces of gold.
Class B Performance Rights – Prior to 1 January 2018 the volume weighted average price of the Company’s
Shares over 5 consecutive trading days on which the Shares trade is 15 cents or more.
Class C Performance Rights – Prior to 1 July 2018 the volume weighted average price of the Company’s Shares
over 5 consecutive trading days on which the Shares trade is 20 cents or more.
Class D Performance Rights – Prior to 1 July 2019 the volume weighted average price of the Company’s Shares
over 20 consecutive trading days on which the Shares trade is 25 cents or more.
Class E Performance Rights – Prior to 1 July 2020 the volume weighted average price of the Company’s Shares
over 20 consecutive trading days on which the Shares trade is 30 cents or more.
Class F Performance Rights – Prior to 1 July 2018 the volume weighted average price of the Company’s Shares
over 5 consecutive trading days on which the Shares trade is 18 cents or more.
Class G Performance Rights – Delivery of gold production and cashflow for the Teal Gold Project in accordance
with market guidance by 31 March 2018.
Set out below is a summary of the performance rights granted.
Class A
Class B
Class C
Class D
Class E
Class F
Class G
Total
Number granted
933,333
933,333
933,334
3,300,000
3,300,000
300,000
300,000
10,000,000
Grant date
23-Nov-17
23-Nov-17
23-Nov-17
23-Nov-17
23-Nov-17
23-Nov-17
23-Nov-17
Expiry date of
milestone
achievements
Share price hurdle
Fair value per right*
Total fair value that
would be
recognised over the
vesting period if
rights are vested
Number cancelled
at 30 June 2018
Number expired at
30 June 2018
Number vested at
30 June 2018
Number remaining
at 30 June 2018
Number remaining
at 30 June 2019
Amount expensed
in prior year
Amount expensed
in current year
Amount to be
expensed in future
periods if all vesting
conditions met
01-Jul-18
01-Jan-18
01-Jul-18
01-Jul-19
01-Jul-20
01-Jul-18
31-Mar-18
Commercial
hurdle
15 cents
20 cents
25 cents
30 cents
18 cents Commercial
hurdle
0.17
0.17
0.121
0.0938
0.1019
0.135
0.17
0
158,667
94,783
262,640
285,320
40,500
150,000
783,333
0
0
0
150,000
500,000
500,000
933,333
783,334
0
0
0
0
0
0
0
0
2,800,000
2,800,000
2,800,000
2,800,000
0
0
300,000
0
0
158,667
94,783
98,770
66,005
40,500
0
0
0
0
163,870
109,507
0
109,808
0
0
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 5 8
0
0
0
0
0
0
0
0
841,910
1,300,000
300,000
1,083,333
0
0
0
0
0
0
2,016,667
5,600,000
5,600,000
458,725
273,377
109,808
NOTES TO AND FORMING PART OF THE
CONSOLIDATED FINANCIAL STATEMENTS
21a Year ended 30 June 2019 (continued)
The fair value of the rights was determined using Hoadley’s Barrier 1 model that takes into account the vesting
condition of the rights, and was based on the following inputs:
Assumptions
Spot price
Vesting hurdle
Exercise price
Rights
Class A
Class B
Class C
Class D
Class E
Class F
Class G
$0.170
n/a
$0.166
$0.135
$0.135
n/a
n/a
Nil
$0.15
$0.20
$0.25
$0.30
$0.18
Nil
Nil
Nil
Nil
Nil
n/a
n/a
Nil
Expiry period (years)
1-Jul-18
1-Jan-18
1-Jul-18
1-Jul-19
1-Jul-20
1-Jul-18
31-Mar-18
Expected future volatility
90%
90%
90%
90%
90%
90%
90%
Risk free rate
Dividend yield
1.79%
1.79%
1.79%
1.79%
1.91%
1.79%
1.79%
Nil
Nil
Nil
Nil
Nil
Nil
Nil
During the year ended 30 June 2019, $273,377 was recognised as a share based payment made to directors,
with the fair value being recognised over the vesting period.
22
BUSINESS COMBINATION
Acquisition
On 14 June 2019, Horizon acquired 100% of MacPhersons Resources Limited and its subsidiaries’ Kalgoorlie
Ore Treatment Company Pty Ltd and Polymetals (WA) Pty Ltd under a Scheme of Arrangement, under which
Horizon issued 192,586,736 ordinary shares to MacPhersons Resources’ shareholders. The Company also
issued 2,962,640 unlisted replacement options to MacPhersons Resources’ option holders with various exercise
prices and expiry dates.
The total cost of the combination was $21,184,541 and comprised an issue of shares and options. The
consolidated entity issued 192,586,736 ordinary shares with a fair value of 11 cents each, based on the quoted
price of the share on Horizon Minerals Ltd on the Implementation Date of the Scheme of Arrangement. The
2,962,640 unlisted replacement options were valued based with the Black-Scholes valuation method. Key
variables in the option valuation include the price of date of issue of 11 cents, a risk free rate of 1.5% and volatility
of 75%.
Consideration transferred
On the acquisition date, 14 June 2019, the fair value of consideration transferred was recorded as:
Shares issued, at fair value
Options issued, Black-Scholes valuation
Total purchase consideration
$
21,184,541
-
21,184,541
Assets acquired and liabilities assumed at the date of acquisition
The Consolidated Entity recognised the fair values of the identifiable assets and liabilities of MacPhersons
Resources as follows.
Cash
Trade and other receivables
Exploration
Property, plant and equipment
Trade and other payables
Provisions
Net identifiable assets acquired
Net cash inflow from transaction
Net cash acquired under scheme of arrangement
Net cash inflow
$
592,832
69,944
19,117,827
2,517,630
(110,996)
(1,002,696)
21,184,541
592,832
592,832
Impact of acquisition on the results of the consolidated entity
If the business combination had taken place at the beginning of the year, the loss of the Consolidated Entity would
have been $5,547,173 and the revenue from continuing operations would have been $3,163,143.
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 5 9
NOTES TO AND FORMING PART OF THE
CONSOLIDATED FINANCIAL STATEMENTS
23
COMMITMENTS FOR EXPENDITURE
23a Coolgardie Gold Project
During the year ended 30 June 2019, Horizon entered into an Exclusivity Deed with Focus Minerals Limited (ASX:
FML) (Focus) relating to the potential acquisition by Horizon of Focus’ Coolgardie Gold Project.
The Exclusivity Deed includes “no shop” and “no talk” restrictions in favour of Horizon as well as notification and
matching rights in respect of any competing proposals for the Coolgardie Gold project, subject to customary
fiduciary carve outs of Focus’ benefit.
Subsequent to year end, Horizon exercised its matching right under the Exclusivity Deed in response to a superior
competing non-binding proposal to purchase the Coolgardie Gold Project received by Focus from a third party
and has submitted a non-binding counter proposal. The counter proposal increases the proposed consideration
from $40 million to $55 million comprising $12 million in fully paid ordinary shares (based on 20 day VWAP) and
$43 million in cash, payable in tranches. This proposal remains subject to negotiation and entry into formal binding
written documentation and obtaining necessary approvals.
23b Lease commitments
Finance leases
The Group has no finance lease commitments.
Operating leases
The Group has one office lease which commenced on 22 February 2016 and expires on 21 February 2020.
Commitments for minimum lease payments in relation to operating leases are
payable as follows:
Within one year
Later than one year but not later than two years
23c Exploration expenditures
Commitments for minimum expenditure requirements on the mineral
exploration assets it has an interest in are payable as follows:
Within one year
Later than one year but not later than five years
Later than five years
2019
$
2018
$
42,608
42,608
85,216
45,790
45,790
91,580
3,700,000
2,250,000
4,000,000
2,800,000
4,500,000
2,800,000
12,200,000
7,850,000
24
RELATED PARTY TRANSACTIONS
24a Directors / Key Management Personnel
Other transactions with Director related entities
Transactions with related parties are on normal commercial terms and conditions no more favourable than those
available to other parties unless otherwise stated. Disclosures relating to Key Management Personnel are set out
in Note 19 and the Remuneration Report.
Natjo Nominees Pty Ltd
Payments made to Natjo Nominees Pty Ltd, a Company in which Peter Hunt is a
Director, for the reimbursement of expenditures paid for on behalf of Horizon
Minerals Limited.
Closing balance
24b Subsidiaries
See Note 25 for further details regarding subsidiaries.
-
-
1,544
-
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 6 0
NOTES TO AND FORMING PART OF THE
CONSOLIDATED FINANCIAL STATEMENTS
25
INVESTMENT IN CONTROLLED ENTITIES
The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in
accordance with the accounting policy described in Note 1(b):
Name of Entity
Direct Subsidiaries
Black Mountain Gold Ltd
MacPhersons Resources Limited
CGP Minerals Pty Ltd
CGP Assets Pty Ltd
Indirect Subsidiaries
Kalgoorlie Ore Treatment Company Pty Ltd
Polymetals (WA) Pty Ltd
Country of
Incorporation
Class of
Shares
Equity Holding
2019 %
2018 %
Australia
Australia
Australia
Australia
Australia
Australia
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
100
100
100
100
100
100
100
0
0
0
0
0
MacPhersons Resources Limited was acquired on 14 June 2019 pursuant to a Scheme of Arrangement (refer to
Note 22).
The indirect subsidiaries are direct subsidiaries of MacPhersons Resources Limited.
Horizon Minerals Ltd, incorporated in Australia, is the ultimate parent entity of the Group.
26
CONTINGENT LIABILITIES
26a Native title claims have been made with respect to areas which include tenements in which Horizon Minerals
Limited and the controlled entity have interests. The entities are unable to determine the prospects for success or
otherwise of the claims and, in any event, whether or not, and to what extent, the claims may significantly affect
them or their projects.
26b Security bonds are held with respect to tenements held in Northern Territory. Bonds are set by the Department of
Primary Industry and Resources, however there is no certainty that such bonds will be adequate to cover any
environmental damage. Horizon Minerals Limited and its controlled entities are not able to determine the nature
or extent of any further liability in view of changing environmental requirements.
26c Horizon Minerals Limited has been advised of a potential liability arising as a result of the storage of laboratory
waste material at the White Range project site and is currently awaiting approval from the NT Environmental
Protection Authority to bury the material at White Range. As at the date of this report, the potential liability for the
rectification remains unquantifiable.
26d The Company announced to the ASX on 30 April 2018, that it had received a purported cost variation claim from
Resource Mining relating to the Teal Stage 1 project up until September 2017 and that it was working to resolve
this and any additional claims that may be forthcoming from Resource Mining. The Company subsequently
received a further purported cost variation claim from Resource Mining for Teal Stages 1 and 2 through to project
completion. This further purported cost variation claim adopts a different methodology to the previous claim.
In December 2018, Horizon and Resource Mining agreed to a full and final settlement of this matter. The total
disputed variation claims amount was split on a 50:50 basis, while the remaining net operating cash was split 75%
to Intermin and 25% to Resource Mining as originally agreed under the mining contract between the parties.
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 6 1
NOTES TO AND FORMING PART OF THE
CONSOLIDATED FINANCIAL STATEMENTS
27
FINANCIAL RISK MANAGEMENT
The Group's activities expose it to a variety of financial risks; market risk (including fair value interest rate risk
foreign currency risk and price risk), credit risk, liquidity risk and cash flow interest rate risk. The Group's overall
risk management program focuses on the unpredictability of financial markets and seeks to minimise potential
adverse effects on the financial performance of the Group.
Risk management is carried out by the Board of Directors, who identify, evaluate and manage financial risks as
they consider appropriate.
27a Market risk
Price risk
The Group is exposed to equity securities price risk. This arises from investments held by the Group and classified
on the statement of financial position as financial assets at fair value through profit and loss of $605,461 (2018:
$1,013,074).
The investments assets are classified as financial asset at fair value through profit and loss and any changes to
their value is recognised in profit and loss when incurred. The group have used an equity price change of 70%
upper and lower representing a reasonable possible change based upon the weighted average historic share
price volatility over the last 12 months on the investment portfolio held. If the value of the investments held had
moved in accordance with the volatility, and all other factors kept constant, the impact on the profit and loss for
the year ended 30 June 2019 would have been ± $423,823 (2018: ± $709,152).
Fair value interest rate risk
Refer to (e) below.
27b Credit risk
Credit risk is the risk of financial loss to the Group is a customer or counterparty to a financial instrument fails to
meet its contractual obligations, and arises principally from the Group’s receivables from customers.
Presently, the Group undertakes mining, exploration and evaluation activities exclusively in Australia. At the
balance sheet date there were no significant concentrations of credit risk.
(i) Cash and cash equivalents
The Group limits its exposure to credit risk by only investing in liquid securities and only with major Australian
financial institutions.
(i) Trade and other receivables
The Group’s trade and other receivables relate to gold sales, GST refunds and other income.
The Group has determined that its credit risk exposure on all other trade receivables is low, as customers
are considered to be reliable and have short contractual payment terms. Management does not expect any
of these counterparties to fail to meet their obligations.
The carrying amount of the Group’s financial assets represents the maximum credit exposure. The Group’s
maximum exposure to credit risk at the reporting date was:
Cash and cash equivalents
Trade and other receivables
Total
Carrying Amount
2019
$
2018
$
4,951,288
10,297,176
557,218
725,481
5,508,506
11,022,657
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 6 2
NOTES TO AND FORMING PART OF THE
CONSOLIDATED FINANCIAL STATEMENTS
27
FINANCIAL RISK MANAGEMENT (CONTINUED)
27c Liquidity risk
Prudent liquidity risk management implies maintaining sufficient cash and marketable securities, the availability
of funding through the ability to raise further funds on the market and the ability to close-out market positions. Due
to the dynamic nature of the underlying businesses, the Board aims at maintaining flexibility in funding through
management of its cash resources.
Maturities of financial liabilities.
30 June 2019
Group
Less than
6 months
6 – 12
months
Between
1 and 2
years
Between
2 and 5
years
Over
5 years
Total
contractual
cash flows
Carrying
Amount
(assets)/
liabilities
Non-derivatives
$
$
$
$
$
$
$
Non-interest bearing
payables
291,623
Fixed rate borrowings
-
Total non-derivatives
291,623
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
291,623
-
291,623
30 June 2018
Group
Less than
6 months
6 – 12
months
Between
1 and 2
years
Between
2 and 5
years
Over
5 years
Total
contractual
cash flows
Carrying
Amount
(assets)/
liabilities
Non-derivatives
$
$
$
$
$
$
$
Non-interest bearing
payables
298,343
Fixed rate borrowings
-
Total non-derivatives
298,343
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
298,343
-
298,343
27d Cash flow and fair value interest rate risk
As the Group has no significant variable interest-bearing assets, the Group's income and operating cash flows
are not exposed to changes in market interest rates.
27e Fair value measurements
The fair value of financial assets and financial liabilities must be estimated for recognition and measurement or
for disclosure purposes.
AASB 7 Financial Instruments: Disclosures requires disclosure of fair value measurements by level of the following
fair value measurement hierarchy:
(a) quoted prices (unadjusted) in active markets for identical assets or liabilities (level 1),
(b)
inputs other than quoted prices included within level 1 that are observable for the asset or liability, either
directly (as prices) or indirectly (derived from prices) (level 2), and
(c)
inputs for the asset or liability that are not based on observable market data (unobservable inputs) (level 3).
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 6 3
NOTES TO AND FORMING PART OF THE
CONSOLIDATED FINANCIAL STATEMENTS
27e Fair value measurements (continued)
The following table presents the group’s assets and liabilities measured and recognised at fair value at 30 June
2019 and 30 June 2018:
At 30 June 2019
Assets
Financial assets at fair value through profit or loss
Level 1
Level 2
Level 3
Total
- Trading Securities
Other financial assets
- Security deposits
Total assets
At 30 June 2018
Assets
605,461
257,927
863,388
-
-
-
-
-
-
605,461
257,927
863,388
Level 1
Level 2
Level 3
Total
Financial assets at fair value through profit or loss
- Trading Securities
Other financial assets
- Security deposits
Total assets
1,013,074
257,927
1,271,001
-
-
-
-
-
-
1,013,074
257,927
1,271,001
The fair value of financial instruments traded in active markets (such as publicly traded derivatives, and trading
and available-for-sale securities) is based on quoted market prices at the end of the reporting period. The quoted
market price used for financial assets held by the group is the current bid price. These instruments are included
in level 1.
The fair value of financial instruments that are not traded in an active market (for example, over-the-counter
derivatives) is determined using valuation techniques. These valuation techniques maximise the use of
observable market data where it is available and rely as little as possible on entity specific estimates. If all
significant inputs required to fair value an instrument are observable, the instrument is included in level 2.
If one or more of the significant inputs is not based on observable market data, the instrument is included in level
3. This is the case for unlisted equity securities.
Specific valuation techniques used to value financial instruments include:
The use of quoted market prices or dealer quotes for similar instruments.
27f Capital risk management
In employing its capital (or equity as it is referred to on the statement of financial position) the Group seeks to
ensure that it will be able to continue as a going concern and provide value to shareholders by way of increased
market capitalisation. The Group has invested its available capital in intangible assets such as acquiring and
exploring mining tenements and in investments. As is appropriate at this stage, the Group is funded predominantly
by equity.
28
CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS
Estimates and judgments are continually evaluated and are based on historical experience and other factors,
including expectations of future events that may have a financial impact on the entity and that are believed to be
reasonable under the circumstances.
The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by
definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of
causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are
discussed below.
(i)
Exploration & Evaluation Expenditure
The Group’s accounting policy for exploration and evaluation is set out in Note 1(e). If, after having
capitalised expenditure under this policy, the Directors conclude that the Group is unlikely to recover the
expenditure by future exploration or sale, then the relevant capitalised amount will be written off to the
Statement of Comprehensive Income.
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 6 4
NOTES TO AND FORMING PART OF THE
CONSOLIDATED FINANCIAL STATEMENTS
29
PARENT ENTITY FINANCIAL INFORMATION
Current assets
Non-current assets
Total assets
Current liabilities
Non-current liabilities
Total liabilities
Net assets
Equity
Contributed equity
Reserves
Accumulated losses
Total equity
Profit/(Loss) for the year
30
JOINT VENTURES
2019
$
2018
$
7,459,106
13,598,415
39,060,120
13,896,689
46,519,226
27,495,104
1,783,235
2,539,500
100,000
100,000
1,883,235
2,639,500
44,635,991
24,855,604
49,746,534
27,523,594
1,166,406
893,029
(6,276,949)
(3,561,019)
44,635,991
24,855,604
(2,715,930)
3,524,416
Horizon Minerals Limited and its controlled entity Black Mountain Gold Ltd (BMG) have interests in unincorporated
joint ventures as follows:
Name of Joint Venture
Notes
Exploration For
2019
2018
Otto Bore
Nanadie Well
Richmond
a
b
c
Gold
Copper
Vanadium
3% gross gold royalty 3% gross gold royalty
100%
75%
100%
100%
A joint venture is not a separate legal entity. It is a contractual arrangement between the participants for the
sharing of costs and output and does not in itself generate revenue and profit.
30a Barrick (PD) Australia Limited, through its subsidiary Barrick (Plutonic) Limited, earned a 75% interest in the Otto
Bore Tenements. Horizon elected in 2000 to assign the tenements to Plutonic and revert to a 3% gross gold
royalty.
30b
30c
In December 2013, Mithril Resources Ltd (MTH) and its wholly owned subsidiary Minex (West) Pty Ltd entered
into a farm-in and joint venture agreement with Horizon Minerals Limited to acquire up to 75% interest of the
Nanadie Well Gold Project. Minex may acquire a 60% interest in the Tenements by expending $2M, Minex may
elect to acquire a further 15% interest (for a total 75% interest) by expending a further $2M in a two year period
with a minimum ground exploration cost of at least $400,000 each year of the 2 year period.
In March 2017, the Company finalised a strategic development JV with Richmond Vanadium Technology Pty Ltd
(“RVT”) (formerly AXF Vanadium Pty Ltd), a wholly owned subsidiary of the AXF Group. The JV covers Horizon’s
100% interest in the Richmond vanadium project in North West Queensland which include metal rights at the
nearby Julia Creek project which is owned by Global Oil Shale Plc. The project tenements cover 1,520km2 of
Cretaceous Toolebuc Formation. In February 2018, RVT had committed to the second stage expenditure
commitment of A$5 million over 3 years inclusive of a Feasibility Study.
31
JOINT OPERATIONS
A Mining and Finance Heads of Agreement was executed with Resource Mining Pty Ltd (“RM”) on 7 October 2016
in relation to the development of the Teal Gold Project Stage 1 (TS1) as announced to the ASX on 19 July 2016.
Under the agreement, the net operating cash from mining operations was split 75% to Intermin and 25% to RM.
As at 30 June 2018, final ore processing at TS1 was completed, and profit shares due to RM had been included as
payables at 30 June 2018. In December 2018, RM and Intermin agreed a further settlement of disputed amounts
and all payments were made pursuant to the settlement agreement by 31 December 2018. Refer to Note 26(d) for
further information.
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 6 5
NOTES TO AND FORMING PART OF THE
CONSOLIDATED FINANCIAL STATEMENTS
32 EVENTS OCCURRING AFTER REPORTING DATE
(a) Subsequent to year end, 3,300,000 Class D Performance Rights lapsed and 500,000 unlisted options with
an exercise price of $0.25 expired on 31 August 2019.
(b) On 24 July 2019, the Company changed its name from Intermin Resources Limited to Horizon Minerals
Limited.
(c) Kingwest Resources Limited
On 9 July 2019, the Group announced it reached an agreement with Kingwest Resources Limited (ASX:
KWR) (Kingwest) to divest its Menzies and Goongarrie gold projects for a total consideration of $8,000,000
on the following terms:
Initial cash deposit of $750,000 (received) of which $250,000 is non-refundable.
On settlement:
o A further $1,000,000 in cash; and
o
Issue 20 million ordinary shares in Kingwest to Horizon at a deemed issue price of $0.15 per share
and subject to voluntary escrow from issue until the earlier of;
- 18 months following settlement; and
- 3 months following the payment/issue of the deferred consideration.
A deferred payment no later than 18 months after settlement of:
o A further $1,625,000 in cash; and
o $1,625,000 in value of ordinary shares in Kingwest at a deemed issue price being the lower of $0.15
per share and a 30 day VWAP (subject to shareholder approval and Horizon not exceeding 19.9%
ownership in Kingwest).
Settlement is subject to the following key conditions precedent:
Completion of due diligence by Kingwest;
Kingwest completing a minimum $4,000,000 capital raising;
Shareholder approval of the issue of the upfront consideration shares and shares under the capital
raising; and
A Horizon nominee director to be appointed to the Kingwest Board.
The divestment comprises 38 mining, prospecting and exploration licences with a current JORC resource of
195,000 ounces.
On 18 September 2019, the Group announced that the divestment of Horizon’s interest in the Menzies and
Goongarrie gold projects were completed. All conditions precedent including provision of signed transfers,
all mining information and statutory consents have been completed or waived, Jon Price was appointed as
Non-Executive Director of Kingwest and the settlement payment and share issue received from Kingwest.
(d) Coolgardie Gold Project
During the year ended 30 June 2019, Horizon entered into an Exclusivity Deed with Focus Minerals Limited
(ASX: FML) (Focus) relating to the potential acquisition by Horizon of Focus’ Coolgardie Gold Project.
The Exclusivity Deed includes “no shop” and “no talk” restrictions in favour of Horizon as well as notification
and matching rights in respect of any competing proposals for the Coolgardie Gold project, subject to
customary fiduciary carve outs of Focus’ benefit.
Subsequent to year end, Horizon exercised its matching right under the Exclusivity Deed in response to a
superior competing non-binding proposal to purchase the Coolgardie Gold Project received by Focus from
a third party and has submitted a non-binding counter proposal. The counter proposal increases the
proposed consideration from $40 million to $55 million comprising $12 million in fully paid ordinary shares
(based on 20 day VWAP) and $43 million in cash, payable in tranches. This proposal remains subject to
negotiation and entry into formal binding written documentation and obtaining necessary approvals.
(e) Asset Swap with Northern Star Resources
On 12 September 2019 the Group announced it had reached agreement with Northern Star Resources
Limited to a tenement exchange in the WA Goldfields for nil cash consideration.
The transaction would see Horizon divest its 100% interest in the Anthill, Blister Dam, New Mexico, White
Flag and Kanowna North tenements and acquire 100% interest in Northern Star’s Rosehill, Brilliant North
and Gunga West projects in Coolgardie and the Golden Ridge, Balagundi, Abattoir and Mt Monger projects
in Kalgoorlie.
There are no other matters or circumstances that have arisen since 30 June 2019 that have or may significantly
affect the operations, results, or state of affairs of the Group in future financial periods.
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 6 6
INDEPENDENT AUDIT REPORT TO THE MEMBERS OF
HORIZON MINERALS LIMITED
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 6 7
INDEPENDENT AUDIT REPORT TO THE MEMBERS OF
HORIZON MINERALS LIMITED
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 6 8
INDEPENDENT AUDIT REPORT TO THE MEMBERS OF
HORIZON MINERALS LIMITED
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 6 9
INDEPENDENT AUDIT REPORT TO THE MEMBERS OF
HORIZON MINERALS LIMITED
H o r i z o n M i n e r a l s L i m i t e d A n n u a l R e p o r t 2 0 1 9
P a g e 7 0
SHAREHOLDER INFORMATION
Additional information required by the Australian Stock Exchange Limited Listing Rules, and not disclosed elsewhere in
this report.
SHAREHOLDINGS
The numbers of ordinary shares held by the substantial shareholders as at 23 September 2019 were:
Michael Ruane
Orion Mine Finance (Master) Fund I LP
Ashok Aaron Parekh
64,256,768
33,838,607
23,064,353
UNQUOTED SECURITIES OPTIONHOLDINGS
Nature
Expiry Date
Exercise Price of
Options
Number under
Option
Number of Holders
Unlisted options
9 December 2019
29.12 cents
2,743,184
Unlisted options
28 February 2020
69.88 cents
219,456
2
2
The numbers of unlisted options with an exercise price $0.2912, expiring 9 December 2019 held by the substantial
optionholders as at 23 September 2019 were:
Parkview Super Nominees Pty Ltd
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