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A N N UA L R EP O R T
2018
Impact Minerals Ltd | Annual Report 2018 1
2 Impact Minerals Ltd | Annual Report 2018
CONTENTS
Corporate Directory
Chairman’s Letter
Review of Operations
Financial Report
Directors’ Report
Auditor’s Independence Declaration
Consolidated Statement of Profit or Loss
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Notes to the Consolidated Financial Statements
Directors’ Declaration
Auditor’s Report
Additional Shareholder Information
Tenement Schedule
04
05
06
31
32
46
47
48
49
50
51
88
89
90
93
Impact Minerals Ltd | Annual Report 2018 3
CORPORATE DIRECTORY
DIRECTORS
AUDITORS
Peter Unsworth
Michael Jones
Paul Ingram
Markus Elsasser
Eamon Hannon
Non-Executive Chairman
Managing Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
COMPANY SECRETARY
Bernard Crawford
REGISTERED OFFICE & PRINCIPAL PLACE
OF BUSINESS
26 Richardson Street
West Perth, WA 6005
Bentleys Audit and Corporate (WA) Pty Ltd
London House
Level 3, 216 St Georges Terrace
Perth, WA 6000
SHARE REGISTRY
Computershare Investor Services Pty Ltd
Level 11, 172 St Georges Terrace
Perth, WA 6000
Telephone:
Facsimile:
+61 (8) 9323 2000
+61 (8) 9323 2033
SECURITIES EXCHANGE LISTING
Telephone:
Facsimile:
+61 (8) 6454 6666
+61 (8) 6314 6670
The Company is listed on the Australian
Securities Exchange Ltd (“ASX”)
Email:
Web:
info@impactminerals.com.au
www.impactminerals.com.au
Home Exchange: Perth, Western Australia
ASX Code:
IPT, IPTOA
4 Impact Minerals Ltd | Annual Report 2018
CHAIRMAN’S LETTER
Dear Fellow Shareholder,
It is my pleasure to present the Impact Mining Limited Annual Report for the year ended
30 June 2018.
Over this period and continuing to date, your company has been very active both in terms
of on-going exploration and also in commercial transactions on some of its projects. This
work has yielded excellent results and demonstrated ability to increase the value of our
projects via our exploration programmes.
Two major drill programmes were completed at the Commonwealth Project and as we go
to press results are coming in from the second programme as well as from drilling at the
Clermont and Mulga Tank Projects where exploration was reinvigorated during the year.
This work followed successful capital raisings in the second half of 2017.
Three significant commercial transactions have also been completed. The Company staked
new tenements in the Pilbara region of Western Australia during the “gold-rush” to that area
following the discovery of conglomerate-hosted gold by Canadian company Novo Resources
Corporation. Impact was able to sell these tenements at a significant premium for cash and
shares to another Canadian company Pacton Gold Incorporated. In addition the company
acquired an option and staked its own ground over another conglomerate hosted gold project
in Queensland and this will be a focus for Impact during 2019.
A joint venture was also agreed with BlueBird Battery Metals Corporation, also from
Canada, for that company to farm into Impact’s Broken Hill project. The joint venture,
which is still being finalised, will also include cash and share payments to Impact.
On behalf of the Board, I would like to acknowledge the dedication and commitment
of our first-class exploration team, who continue to work tirelessly to deliver significant
results. I would also like to thank the communities in which we operate for their ongoing
support and assistance.
Peter Unsworth
Chairman
Impact Minerals Ltd | Annual Report 2018 5
REVIEW OF OPERATIONS
Impact Minerals Limited is an Australian Exploration Company listed on the Australian Stock
Exchange (ASX-IPT). The company is a project generator and developer and explores a portfolio
of tenement holdings (~2,500 sq km) within major mining regions of Australia featuring significant
potential for high-grade mineral deposits of gold, silver, lead, zinc, copper, cobalt, nickel and
platinum group metals. The company has five active exploration projects, each containing
multiple, high-grade mineral discoveries with active drill testing:
Commonwealth Project: 903 sq km in the Lachlan Fold Belt in New South Wales prospective
for volcanogenic massive sulphide deposits of gold, silver and base metals as well as porphyry
copper-gold.
Blackridge Project: 91 sq km covering Permian sedimentary rocks near Clermont in central
Queensland and prospective for conglomerate-hosted gold deposits.
Clermont Project: 70 sq km in the Anakie Inlier and also close to Clermont which is prospective
for epithermal and quartz vein-hosted gold deposits.
Mulga Tank Project: 694 sq km in the Yilgarn region of Western Australia prospective for nickel-
copper-cobalt and gold deposits.
Broken Hill Project: 718 sq km in the Broken Hill region prospective for silver-lead-zinc, nickel-
copper- platinum group metals and copper-cobalt-gold deposits. This project recently became
subject to an earn-in JV announced in July 2018 which will result in cash and share payments to
Impact as well as exploration expenditure to advance the project.
Corporately, with the continued support of our loyal shareholders, the Company has maintained a
sound financial position from which to pursue its growth objectives. In addition following the sale
of tenements staked in the Pilbara region of Western Australia, Impact has significant exposure to
the emerging major discoveries of conglomerate-hosted gold mineralisation in the Pilbara region
of Western Australia via 2.125M shares in a well-funded, TSX-listed, Canadian explorer, Pacton
Gold Incorporated, that has an extensive land holding in that region.
6 Impact Minerals Ltd | Annual Report 2018
REVIEW OF OPERATIONS (CONTINUED)
1.
COMMONWEALTH GOLD-SILVER-BASE METAL PROJECT (IPT 100%)
The Commonwealth Project comprises 903 sq km of exploration licences centred about 100 km
north of Orange, NSW. The exploration project is focused on the Lachlan Fold Belt, host to the
Cadia Valley Mine (34 million ounces of gold and 5 million tonnes of copper reserves) and the
historic Copper Hill Mine (1.5 million ounces of gold and 0.5 million tonnes of copper resources).
Initial work by Impact in 2014 outlined a maiden Inferred Resource of 720,000 tonnes at
2.8 g/t gold and 48 g/t silver centred on historic underground workings at the Commonwealth
Main Shaft prospect see below and ASX announcement 19th February 2015). Mineralisation
extends over 400 metres of strike length, to a depth of 200 metres below surface and is up to
25 metres wide, and contains a high-grade core of massive sulphide mineralisation.
Current exploration is focused on immediate extensions to the existing resources including:
• The depth projection of the massive sulphide lens at Main Shaft beyond a very high grade
drill intersection of 7 metres at 6.3 g/t gold, 496 g/t silver, 7.2% zinc, 2.9% lead,
0.2% copper and 9% barium from 91 metres in CMIPT031, along with strike and depth
extensions of the Inferred Resource envelope (ASX June 16th 2016).
• A new discovery at the Silica Hill prospect, 200 metres northeast of Main Shaft, where drill
hole CMIPT046 intersected 41.3 metres at 2.0 g/t gold and 176 g/t silver from 61 metres
down hole and CMIPT077 intersected 22.5 metres at 1.7 g/t gold and 276 g/t silver from
166.7 metres down hole (ASX February 13th 2018).
• A new discovery at the Welcome Jack prospect, 1,200 metres east of Commonwealth Main
Shaft, where CMIPT027 intersected 20 metres at 0.5 g/t gold, 27 g/t silver and 1.1% zinc
(ASX June 30th 2016).
• Regional-scale barium anomalism in government stream sediment sampling (ASX May 31 2017).
Work this year continued to demonstrate the strong geological similarities between the
mineralised system at Commonwealth-Silica Hill and the high-grade Eskay Creek Volcanogenic
Massive Sulphide deposit in British Columbia, Canada (4 million ounces of gold and 180 million
ounces of silver). The company recently increased its landholdings in NSW and continues to build
its exploration model outwards from its existing prospects to target two types of deposits:
• Volcanogenic Massive Sulphide e.g. Eskay Creek, Woodlawn
Intrusive-Related Copper-Gold e.g. Cadia Valley, North Parkes
•
Impact concentrated the majority of its drilling activities at the Commonwealth Project during the
year with sixteen diamond and fourteen holes completed.
Drilling from June to November 2017 was designed to explore for extensions to high-grade
gold-silver mineralisation discovered in mid-2016 by Impact at the Silica Hill prospect, to grow
resources at Main Shaft and Commonwealth South resources and to initiate exploration at the
Welcome Jack prospect (Figure 1).
Following the receipt of very encouraging results, together with ongoing regional exploration data,
drilling at Commonwealth recommenced in early July 2018 with the goal of finalising resource
additions to the Commonwealth Main Shaft and Commonwealth South prospects and a maiden
resource estimate for the Silica Hill prospect in 2019.
Impact Minerals Ltd | Annual Report 2018 7
REVIEW OF OPERATIONS (CONTINUED)
Figure 1. Geology and location of key prospects in the Commonwealth Project area.
8 Impact Minerals Ltd | Annual Report 2018
REVIEW OF OPERATIONS (CONTINUED)
Silica Hill Prospect 2017-18 Drilling Results
The robust and significant results delivered from Silica Hill continue to demonstrate the potential
for bulk mining and to significantly increase the resources at the Commonwealth Project, which
currently stand at 720,000 tonnes at 2.8 g/t gold, 48 g/t silver, 1.5% zinc and 0.6% lead (see
below). Large areas of the Commonwealth mineral system still remain untested by drilling and it
is evident that there is significant exploration upside in the area linked to a possible, large-scale,
buried intrusion (Figure 2).
Figure 2. Proposed exploration model for Commonwealth-Silica Hill-Welcome Jack.
Impact Minerals Ltd | Annual Report 2018 9
REVIEW OF OPERATIONS (CONTINUED)
Diamond drill hole CMIPT050 was drilled to test an Induced Polarisation conductor at depth below
the massive sulphide lens at Main Shaft and intersected a broad zone of visible disseminated
copper sulphide mineralisation (Figure 3) which assayed: 49 metres at 0.1% copper from
269 metres down hole (ASX July 20 2017). The source of the IP conductor remains somewhat
unclear and a down hole EM survey is planned to confirm and expand the bulk-tonnage potential
close to the near-surface high grade massive sulphide resource at Main Shaft.
Figure 3. Cross section looking northwest from Main Shaft to Silica Hill. Three components
to the mineralised system are evident: an upper zone of weakly mineralised gold-silver veins; a
middle zone of high grade gold-silver +/- base metal veins; and a lower zone of massive sulphide
and increasing copper-gold-silver at depth.
RC Hole 56 intersected a deeper gold-silver rich zone and a shallower silver-rich zone similar to that
observed in previous drill holes from Silica Hill. The deeper gold-silver rich zone has returned the
highest grade gold intercept returned thus far from Silica Hill about 100 m below surface:
20 metres at 3.3 g/t gold and 53 g/t silver from 149 m down hole (ASX 20 July 2017).
These new assays from Hole 56 are interpreted to be the northwest extension of, and materially
better than, the gold-rich zone discovered by Impact in Hole 43 (68 metres at 0.5 g/t gold and
43 g/t silver from 99 metres).
Close-spaced drilling completed to date has elucidated further important structural controls on
high grade shoots as well as the broad vertical and lateral metal zonation within the stockwork vein
system. East-west trending structures have now been identified as an important control on the high
grade zones and shoots within the overall north east trending zone of mineralisation, and it has been
shown that the entire vertical extent of the mineralised system has been preserved from an upper
barren silica-pyrite zone that passes progressively down and laterally through low grade silver +/-
gold veins; higher grade gold and silver veins; and a lower zinc-lead-copper zone containing “feeder
veins” of massive base metal sulphides that also have high grade gold and silver in places.
10 Impact Minerals Ltd | Annual Report 2018
REVIEW OF OPERATIONS (CONTINUED)
Hole CMIPT063 tested a modest north east extension of the mineralised zone and returned a
116 metre thick zone of veins from 57 metres down hole and comprised a lower 70 metre thick
zone of silver and base metal-rich veins and an upper 40 metre thick zone of silver-rich veins.
Figure 4. High grade “feeder vein” at 114.5 metres depth in Hole 63 containing silver, zinc, lead
and copper with accessory molybdenum, antimony, tin and bismuth.
The lower zone comprises veins of zinc, lead and copper sulphides that are up to a few centimetres
thick and spaced every 50 cm to 1 metre down hole. There are thicker veins up to 20 cm thick in
places (Figure 4). The nature of the veins and the unique metal assemblage are interpreted to be
characteristic of the edges of a high grade “feeder zone” to the large mineralised system at Silica
Hill. This is the first indication of this type of feeder vein at Silica Hill. Such feeder zones occur
within gold-rich volcanogenic massive sulphide deposits (gold-rich VMS), a class of deposit
only recognised within the past 20 years. The feeder zone at Silica Hill is interpreted to extend for a
further 1,000 metres to the northeast and will be tesetd in future campaigns.
The type-deposit of the gold-rich VMS systems is the well-known Eskay Creek deposit in British
Columbia, Canada which was mined mostly during the early 2000’s and contained over 4 million
ounces of gold and 180 million ounces of silver in numerous very gold and silver-rich ore shoots
over a vertical extent of at least 700 metres.
The upper silver rich zone in Hole CMIPT063 comprises veins of pyrite-arsenopyrite sulphide up to
5 cm thick that occur individually or as stockworks of veins in zones up to 25 cm thick and spaced
every 30 cm or so down hole (Figure 5).
Figure 5. Quartz-pyrite-arsenopyrite-silver vein and stockwork from 77 m depth in Hole 63.
In addition the wallrock is mineralised in a few places places and is “flooded “ with so called “ruby
silver” minerals (proustite and pyrargyrite) (Figure 6). Native silver may also be present (and as
seen in previous drill holes).
Impact Minerals Ltd | Annual Report 2018 11
REVIEW OF OPERATIONS (CONTINUED)
Hole CMIPT063 assayed: 98 metres at 0.7 g/t gold and 53 g/t silver from 58 metres down hole
(ASX September 21 2017).
Diamond drill hvole CMIPT061 was drilled to test the north west extension of mineralisation and has
intersected a 90 metre thick zone comprising an upper 30 metre thick zone of silver rich veins and
a lower 60 metre thick zone of 50 ppm to 200 ppm molybdenum that occurs in narrow fractures
and as fine grained disseminations in the rhyolite host rock. The upper silver rich quartz veins also
contain visible ruby silver minerals in places (Figure 6) and returned 10 metres at 86 g/t silver.
Figure 6. Quartz-ruby silver vein with pyrite and arsenopyrite from 55 m depth in Hole 61.
RC hole CMIPT060 was drilled below CMIPT063 and failed to reach depth and ended in
mineralisation at 88 metres. CMIPT060 intersected: 37 metres at 1.0 g/t gold and 31 g/t silver
from 51 metres (ASX September 21st 2017).
Drill holes CMIPT064 and 65 were drilled above failed hole CMIPT060 and also intersected
stockworks of narrow veins (Figure 7). These holes were sampled at practical sample widths
of about one metre and have returned significant widths of anomalous gold and silver assays.
CMIPT064 returned 84 metres at 0.3 g/t gold and 18 g/t silver and CMIPT065 returned
62 metres at 0.5 g/t gold and 17 g/t silver (ASX September 21st 2017).
The vein system at Silica Hill is now defined over 250 metres in length and is still open along trend
and at depth.
Drill hole CMIPT071 was completed to test below these strongly anomalous intercepts and to
test the lower gold-rich zone and the down dip extension of the high grade base metal massive
sulphide veins in CMIPT063.
Figure 7. Examples of pyrite-arsenopyrite vein styles and orientations from Hole CMIPT64 from
down hole depths shown. Similar veins are seen in Holes 65 and 66. All contain silver.
12 Impact Minerals Ltd | Annual Report 2018
REVIEW OF OPERATIONS (CONTINUED)
An intial interpretation of these results combined with detailed logging of the diamond core,
shows that the overall northeast trending corridor of mineralisation at Silica Hill is resolving into
several mineralised domains related to east-west trending, steeply south dipping structures
(Figure 3). The intersection of the east-west and northeast trending structures appears to be a
strong control on the higher grade portions and shoots of the mineralised system.
At least two east-west structures have been identified, each over at least 400 metres of strike and
both open along trend and at depth.
One structure occurs along the southern contact of the Silica Hill rhyolite and includes the high
grade assays from Holes 43 and 11 (e.g. 23 metres at 1 g/t gold and 224 g/t silver including
0.9 metres at 2.4 g/t gold and 3,146 g/t silver). This southern mineralised structure has good
grade and geological continuity over a strike extent of at least 200 metres and returned high
grade gold and very high grade silver results within the north west trendng part of the zone. For
example, diamond drill hole CMIPT077 returned an intercept of: 22.5 m at 1.7 g/t gold and
276 g/t silver from 166.7 metres down hole (ASX February 13th 2018).
The northern mineralised zone, whilst of lower grade, also demonstrates very good continuity and
returned a very thick intercept in RC drill hole CMIPT078 of: 117 metres at 0.3 g/t gold and
11 g/t silver from 74 metres down hole. (ASX February 13th 2018). The structure is also defined
in part by extensive low grade molybdenum with lesser tin, a metal assemblage interpreted as
further evidence that the mineralising fluids may be sourced from a late stage intrusive at depth.
Further drilling will also test these structures along trend and at depth.
The silver grades and minerals within the vein system discovered at Silica Hill are exceptional and
confirm the unique nature of this deposit in Australia.
The northern and southern structures are separated by a chemically distinct porphyry unit
within the Silica Hill rhyolite. The porphyry is similar in composition to the porphyry unit at the
Commonwealth deposit 150 metres to the west (Figure 8) which comprises a gold-silver rich base
metal massive sulphide lens and veins and disseminations of gold and silver mineralisation. The
change in orientation of the mineralised trend is associated with the chemically-distinct porphyry
unit which separates the two mineralised structures at Silica Hill.
This supports a common link between the two prospect areas and importantly indicates that this
new porphyry unit could be the top of a pipe or sheet-like feature that extends to some depth.
This is a key feature of the model previously proposed by Impact for the area which suggests
the entire system may be underlain and be driven by a porphyry copper-gold similar to Cadia-
Ridgeway and North Parkes (see Figure 4).
Further drilling has recently been completed at Silica Hill and also Main Shaft-Commonwealth
South and assays are awaited.
Impact Minerals Ltd | Annual Report 2018 13
REVIEW OF OPERATIONS (CONTINUED)
Figure 8. Silica Hill Prospect: Geology, drill hole locations and recent significant results.
The mineralisation is open and large areas remain to be drill tested.
Welcome Jack
Drill and rock chip assays together with an interpretation of ground gravity data have identified the
Welcome Jack Trend, located approximately one kilometre east of the Commonwealth-Silica Hill
area as a prospective area for further discoveries (Figure 1). The new assay results demonstrate
high grade gold and silver is associated with barite (barium sulphate) and linear zones of
silicification over a strike length of more than 2,000 metres along the Trend. In the south, these
zones occur around the margins of a diorite intrusion exposed at surface (Figure 9).
14 Impact Minerals Ltd | Annual Report 2018
REVIEW OF OPERATIONS (CONTINUED)
Figure 9. Geology and key exploration results along the Welcome Jack Trend.
Impact Minerals Ltd | Annual Report 2018 15
REVIEW OF OPERATIONS (CONTINUED)
Key results achieved in 2017-2018 at Welcome Jack include:
• Drill hole CMIPT053 was drilled under old gold workings at the Welcome Jack Prospect
and returned: 2 metres at 5.7 g/t gold and 0.4% barium from 28 metres down hole
(ASX June 30th 2016).
• A rock chip sample taken 700 metres north of CMIPT053 returned: 17.0 g/t gold,
11 g/t silver and 0.34% barium (ASX April 13th 2018). This area has not been drilled.
• At the Walls Mine 800 m to the south of Welcome Jack Mine, a 20 metre thick silver-gold
zone was discovered in CMIPT027. New re-assays of two anomalous samples for barium
within this zone returned: 1 m at 2.9 g/t gold, 144 g/t silver and 0.2% barium and
1 m at 1.0 g/t gold, 46 g/t silver and 0.8% barium within the thicker zone of
20 m at 0.5 g/t gold and 27 g/t silver from 55 metres (ASX April 13th 2018).
• At the Stringers Mine located 500 metres further south of the Walls Prospect, rock chips
returned up to 6.3 g/t gold and 120 g/t silver associated with massive barite with assays
of up to 23.0% barium (ASX April 13th 2018).
All of these results are associated with large and extensive gold-silver-barium-in-soil anomalies,
which at Walls and Stringers occur around the margins of the diorite intrusion (Figure 9). Barite is
intimately associated with the massive sulphide deposit at Main Shaft (Figure 1) where a key drill
result from CMIPT031 recorded: 7 metres at 6.3 g/t gold, 496 g/t silver, 7.2% zinc,
2.9% lead and 9.0% barium from 91 metres (ASX April 13th 2018). Unfortunately, high levels
of barium (>3,000 ppm) can only be assayed accurately at high levels by a costly X-Ray Fusion
analysis. Accordingly barium assays are not done routinely on drill core and only selected
samples, including those reported above, were chosen to ascertain the likely distribution of
barium along the Welcome Jack Trend.
Images of previously collected ground gravity data show that the diorite, and particularly the
western half, is characterised by a gravity high (Figure 10). An outcrop of similar diorite is also
associated with the edge of a gravity high at Welcome Jack and is also adjacent to one of the
gold-silver-barium-in-soil anomalies.
Extensive further drilling is required in this prospect area.
16 Impact Minerals Ltd | Annual Report 2018
REVIEW OF OPERATIONS (CONTINUED)
Figure 10. Image of ground gravity data along the Welcome Jack Trend
STATEMENT OF RESOURCES
The Inferred Resource at Commonwealth was prepared in accordance with the JORC 2012 Code
by independent resource consultants, Optiro. At a 0.5 g/t gold cut off the Inferred Resource is:
Category
Tonnes
Au ppm
Ag ppm
Cu%
Inferred
720,000
2.8
48
0.1
Pb%
0.6
Zn%
1.5
The resource, which is open along trend and at depth, contains both massive sulphide
mineralisation at the Main Shaft prospect and disseminated, vein and lesser massive sulphide
mineralisation at the Commonwealth South prospect. It extends from surface to an average depth
of 90 m, has a strike length of 400 m and is up to 25 m thick.
Impact Minerals Ltd | Annual Report 2018 17
REVIEW OF OPERATIONS (CONTINUED)
A separate Inferred Mineral Resource (included within the overall resource) has also been calculated
for the massive sulphide lens at Main Shaft alone to demonstrate the high grade nature of such
deposits that are the principal target for Impact’s exploration programme. The Main Shaft Inferred
Resource is:
Category
Tonnes
Au ppm
Ag ppm
Inferred
145,000
4.3
142
Cu%
0.2
Pb%
1.7
Zn%
4.8
The Commonwealth deposit comprises two areas, Main Shaft and Commonwealth South. The
mineralisation at Main Shaft comprises massive sulphide with high grade gold, silver, zinc, lead and
copper mineralisation at the upper contact between a rhyolite unit and overlying volcanic sedimentary
rocks. Mineralisation at Commonwealth South occurs at both the upper and lower contacts of the
rhyolite and is dominated by 1-50 mm thick stringers and disseminations of sulphide, often associated
with intense brecciation and faulting of the rhyolite.
The Commonwealth Resource strike length is 400 m and it is open along trend in particular to the
south. The mineralisation has been defined to a maximum depth of 150 m and is still open.
Twenty one new holes were drilled by Impact in 2014. The total number of holes into the
Commonwealth project is 108, comprising 49 reverse circulation (RC) holes, 45 diamond holes,
10 underground channel samples and four underground drill holes. Of these holes, 52 intersected
the mineralisation wireframe and were used in the estimation. Although some of the holes are from
previous explorers, Impact has twinned some of the higher grade intersections and these have largely
confirmed the grades and widths.
Quality control measures employed during Impact’s drill programme included the use of certified
standards (1% of total sample population), field duplicates (2% of total sample population) and blanks
(2% of total sample population). No previous quality assurance/quality control (QAQC) has been
carried out at the Commonwealth Project. Analysis of the standards and blanks showed acceptable to
good levels of accuracy in the assaying and little contamination. The duplicate samples matched the
originals with a high degree of precision.
The drill hole database was reviewed and validated by Optiro. Three-dimensional solid wireframes
were constructed from sectional interpretations of the mineralisation using a nominal 0.5 g/t gold cut
off grade. Drill hole intercepts were composited down-hole to 1 m lengths and gold, silver, copper,
zinc, lead and arsenic grade estimation was carried out using ordinary kriging with hard boundaries.
Three search passes, with increasing search distances and decreasing minimum sample numbers,
were employed to fully inform the model. Less than 1% of blocks were not filled in the first three
passes. Further estimation passes were run to assign mean grades to un-estimated blocks.
The Commonwealth Mineral Resource estimate has been classified as an Inferred Mineral Resource
in accordance with the guidelines of the Australasian Code for the Reporting of Exploration Results,
Mineral Resources and Ore Reserves (the JORC Code, 2012). Mineral Resources have been classified
on the basis of confidence in geological and grade continuity, geological modelling confidence, grade
continuity and limited QAQC. No Measured or Indicated Mineral Resources have been defined.
The Mineral Resource estimate for the Commonwealth Project has been reported above a
0.5 ppm gold cut-off grade. The estimate has been depleted for previous historic mining. Grades have
been reported as individual elements (gold, silver, zinc, lead and copper).
18 Impact Minerals Ltd | Annual Report 2018
REVIEW OF OPERATIONS (CONTINUED)
2.
CLERMONT (IPT 100%)
Impact holds 100% of EPM14116 near Clermont located in the southern part of the Drummond
Basin in Central Queensland; a prolific epithermal gold-silver belt which hosts several world class
gold deposits such as Pajingo (Vera-Nancy) (>5 Moz), Mt Leyshon (>3 Moz) and Mt Wright
(>1 Moz) (Figure 11).
Previous exploration by the Company and others in the project area has identified a mineralised
system containing high-grade gold, silver and base metals along a 10 km long, northeast-trending
fault structure with potential for epithermal gold-silver and porphyry copper-gold deposits.
Exposure is limited to rubbly outcrops of breccia and vein quartz sub-cropping within black soil
plains. Silica-pyrite-sericite alteration appears widespread and rock chip results along strike from
quartz veins have returned values up to 4.5 g/t gold.
Previous drill intercepts of interest include: 2 m at 13.7 g/t gold from 34 m in RRC11, 4 m at
1.1 g/t gold from 18 m, and 2 m at 2.5 g/t gold from 42 m in RRC09, 2 m at 6.3 g/t gold,
9.7 g/t silver, 0.3% lead and 0.1% zinc from 141 m in RERC030, 4 m at 1.7 g/t gold, 113 g/t silver,
0.6% copper, 0.6% lead and 0.4% zinc from 73 m in RERC031, and 4 m at 1 g/t gold,
18.4 g/t silver, 0.1% copper, 0.3% lead and 0.1% zinc from 116 m in RERC032 (ASX August 1st 2018).
A large east-trending sericite-pyrite alteration zone measuring at least 1,500 m by 300 m in
dimension, has been mapped along the northern margin of the Retreat Granite at the southern
end of the fault zone. It is possible that there is a transition from precious and base metal
epithermal-style vein mineralisation in the northeast towards lower grade, bulk tonnage porphyry-
style mineralisation in the southwest. Grab samples returned encouraging assays of up to:
26 g/t silver, 370 ppm molybdenum and 2.7% lead in separate granite samples; and 98.7 g/t silver,
130ppm molybdenum and 4.8% lead and 0.16% zinc in laminated and bladed-textured gossanous
quartz veins within sericite altered granite.
Impact Minerals Ltd | Annual Report 2018 19
REVIEW OF OPERATIONS (CONTINUED)
During the year a new gradient array Induced Polarisation (IP) survey identified multiple coherent
northeast trending linear resistivity anomalies that coincide in part with numerous outcrops of
gold bearing quartz veins along the mineralised fault system. The resistivity data suggests that
the quartz veins extend over a strike length of at least 6,000 metres (Figure 12).
A total of 98 rock chip samples taken from variably gossanous quartz veins over the 6,000 metres
of strike returned assays of up to 8.1 g/t gold (Figure 12) with 35 samples returning assays of more
than 0.1 g/t gold and 10 returning assays greater than 1 g/t gold (ASX August 1st 2018).
A review of an MMI soil geochemistry survey completed by now wholly-owned subsidiary Invictus
Gold Limited in 2012 showed that the linear resistivity anomalies are concident with elevated gold,
silver and lead in soil values as well as elevated copper to the north and zinc to the east (Figure 12).
The IP data together with the soil and rock chip geochemistry data have been used together with
previous drilling data where appropriate to identify five priority areas for drilling as follows.
1. Retro X: This target is a strong, linear 1.6 km long resistivity anomaly that trends north
northeast and is coincident with elevated gold+silver+copper and lead-in-soil anomalies.
Outcrops of gossanous quartz veins occur over the entire strike length and returned rock
chip assays of up to 9.7 g/t gold and 63 g/t silver (2 ounces). Previous drilling along the Retro
X trend returned drill results of up to 8 m at 16 g/t gold and 143 g/t silver (4.6 ounces) from
8 m down hole in Hole RERC001.
2. Carramah: This target is a prominent “S-shaped” 1 km long resistivity anomaly that trends
north northeast and is located 500 metres west of and subparallel to the Retro X trend.
There are no soil samples in this area and it has not been drill tested.
3. Snakegrass: This target comprises a series of strong, subparallel north northeast trending
resistivity anomalies extending for over 2 km of strike and branching in places. The resistivity
anomalies are coincident with elevated gold and silver-in-soil values to the north with a
transition to zinc-and lead-in-soil anomalies toward the southern end. The area has not been
drill tested.
4. Rosewood: This target is a prominent northeast trending linear resistivity anomaly 1.2 km
long with coincident elevated gold-silver-copper- and lead-in-soil values. Well defined zones
of gossanous quartz veins up to 2 m thick associated with a shear zone occur in places
associated with the IP anomaly. Rock chip assays along the trend returned up to
5.4 g/t gold and 75 g/t silver (3 ounces). The main anomaly has not been drilled.
5. Retro North: This target is an extension of the Rosewood resistivity anomaly that extends a
further 1.6 km to the north northeast. Soil sampling has not been conducted in this area however
multiple quartz veins are observed at surface over the entire strike length. Rock chip assays
range from 1.4 g/t gold to the south up to 4.5 g/t gold to the north where the veins become
thicker and more gossanous. Previous drilling returned up to 2 m at 13.7 g/t gold from 34 metres
in Hole RRC011. In addition, the resistivity data suggests at least 3 other parallel splays occur in
an area of poor outcrop to the east over a further 1.4 strike kilometres.
Drill testing of the five target areas has recently been completed with assays awaited.
20 Impact Minerals Ltd | Annual Report 2018
REVIEW OF OPERATIONS (CONTINUED)
Figure 11. Location of the Clermont Project in the Drummond Basin, central Queensland.
Impact Minerals Ltd | Annual Report 2018 21
REVIEW OF OPERATIONS (CONTINUED)
Figure 12. Image showing the resisitivity results of the gradient array IP survey at Clermont. The
warmer colours are areas of high resisitivity and are likely to be quartz veins. Also shown are the
five drill targets and previous relevant drill results.
22 Impact Minerals Ltd | Annual Report 2018
REVIEW OF OPERATIONS (CONTINUED)
3.
BLACKRIDGE PROJECT (IPT 100% and option to acquire 95%)
In May 2018 Impact acquired an option from Rock Solid Holdings Pty Ltd, an unrelated private
company, to purchase a 95% interest in one exploration permit (EPM 26066) and four mining
lease applications (ML 100158, 59, 60 and 61) that cover the Blackridge and Springs gold mining
camps which were discovered as part of an early gold rush north of Clermont commencing in
about 1862 (Figures 11 and 13 and ASX May 29th 2018).
Figure 13. Location and geology of the Blackridge Project. The nuggets in Figure 15 owned by the
project vendor come from an area of about 2 sq km centred on the Daintree shaft.
The Blackridge gold mining camp was discovered as part of an early gold rush north of Clermont
commencing in about 1862. Recorded production from the Blackridge area from 1879 to the early 1900’s
is reported by the Geological Survey/Department of Mines in Queensland to be at least 185,000 ounces of
gold. Virtually all of this gold has come from within the licences optioned by Impact or within the Company’s
new exploration licence application.
Further discoveries were made in the Clermont region including the Springs field in the 1930’s and the total
production from conglomerates in the region is estimated by the Survey to be more than 300,000 ounces
of gold.
Visible gold is mostly hosted in basal conglomerates of Permian sedimentary basins including the mined coal
measures that unconformably overlie the Anakie metamorphic rocks of Middle Ordovician age and older.
Figure 14 shows examples of the nature of the gold nuggets from the project area (ASX May 29th 2018).
Impact Minerals Ltd | Annual Report 2018 23
REVIEW OF OPERATIONS (CONTINUED)
Average mining grades at Blackridge were between 10 g/t and 20 g/t gold with higher grades of
up to 10 ounces per tonne (320 g/t) gold in places, for example at the Bantam shaft (Figure 15) as
recorded by Lionel Ball of the Geological Survey of Queensland. Ball completed detailed studies
of the gold field at Blackridge in a report published in 1905 (Geological Survey of Queensland
Publication No. 201 : publically available).
Impact has identified up to 23 kilometres of strike of the prospective basal conglomerate on its
Exploration Permits.
Previous drilling demonstrates gold-bearing conglomerates and black shale beds at 100 metres
below surface two kilometres down dip and beyond old workings. Previous exploration may have
underestimated the nugget effect and Impact intends to conduct bulk sampling programmes to
determine further development potential.
Figure 14. Gold nuggets recovered from weathered conglomerate at the Blackridge Gold Project.
The nuggets in the first two pictures come from numerous shafts and are owned by the project
vendor. The other nuggets were panned by Impact close to the Hard Hill Shaft (Figure 14). The
steel end of the pen is about 2 cm long. The nuggets have not been weighed.
Figure 15. Section from the base of the Bantam shaft at Blackridge
(Ball, 1905 GSQ P201)
24 Impact Minerals Ltd | Annual Report 2018
REVIEW OF OPERATIONS (CONTINUED)
Figure 15 is a coloured reproduction of a figure from Ball’s report showing the distribution of gold
within the basal six feet (1.8 metres) of sedimentary rock at the Bantam shaft at depth of about
50 metres below surface. There are high grades of gold throughout the sequence with very
high grades of up to 10 ounces per tonne in the basal conglomerate “wash” which also contains
narrow units of black shale.
Of note, gold has also been reported in places from the overlying Permian coal beds including
Blackridge and also including the fly ash from nearby Blair Athol coal mine. However these
occurrences have not been systematically evaluated.
Previous Modern Exploration at Blackridge
Extensive exploration occurred at Blackridge in the late 1980’s and early 2000’s but with little
completed since that time.
The most comprehensive exploration work was completed by Denison Resources Limited
(Herbert, 1989: Geology and Gold Potential, Blackridge, Clermont, Queensland #CR20347) and
included extensive RC drilling, opening up of some of the underground workings, bulk testing,
mineralogy, geochemistry and isotope analysis.
A key outcome of Denison’s work is that the gold may be related to a delicate interplay between
sedimentary and hydrothermal processes. Figure 14 shows that many of the nuggets have water
and or wind worn edges to them and these are clearly transported clasts. They are similar in some
respects, although generally smaller than, some of the nuggets from the major gold discovery
in conglomerates in the Pilbara region of Western Australia discovered by Novo resources
Corporation and Artemis Resources Limited.
However Denison also presented evidence of hydrothermal alteration throughout the lower
sedimentary pile and this may have played a role in the formation of some of the gold.
Impact is now undertaking a synthesis and review of this and other previous exploration data
(ASX May 29th 2018). There are initial indications that there may be a significant nugget effect in
previous exploration drilling results which may have potentially led to an underestimate of the gold
present in the sedimentary units there.
Work by Novo Resources in the Pilbara has demonstrated an extreme nugget effect associated
with the conglomerate-hosted gold in that region and indeed exploration is more akin to diamond
exploration with a requirement for very large bulk samples (currently in excess of several tonnes).
Accordingly it is possible that higher grades may be delineated with an appropriate sampling
methodology. Many of these procedures are currently being developed by Novo Resources in the
Pilbara with good success.
Refining sampling and drilling techniques at depth will be the key to successfully delineating
significant gold resources at the Blackridge Project.
Exploration Potential Along Strike
In addition to the option to acquire Exploration Permit 26066 (9.6 km2) and four mining lease
applications ML’s 100158, 59, 60 & 61 (2.7 km2) at Blackridge, Impact has lodged Exploration
Permit /Application 26806 that covers a further 79 sq km over the Springs gold mining area and
extensions to the conglomerate channel beneath recent sand and gravel and Tertiary basalt along
strike to the southeast.
Impact Minerals Ltd | Annual Report 2018 25
REVIEW OF OPERATIONS (CONTINUED)
This tenement holding now covers at least 23 strike kilometres of Permian basins with the highly
prospective gold-rich basal unconformity interpreted to be preserved at depth over at least 37 square
kilometres. Most of this area has never been drilled.
Next Steps at Blackridge
The review and synthesis of previous exploration data at Blackridge is on-going. In addition compilation
of previous production data and historical maps from the early 1900’s is in progress to more accurately
assess the likely positions of the richer portions and palaeochannels of the Blackridge gold field. Once
complete, areas will be selected for detailed mapping and bulk sampling.
4.
MULGA TANK NI-CU-PGE PROJECT (100% IPT)
Impact owns thirteen granted exploration licences and one application, located 200 km east of Kalgoorlie,
WA, that cover 694 sq km of the Minigwal greenstone belt in the southeast Yilgarn Craton (Figure 16).
Impact has identified three styles of high tenor nickel and copper sulphide mineralisation within the Mulga
Tank Dunite and surrounding rocks in its maiden drill programme at the project (see announcement
29th January 2014).
• High grade veins in the basal adcumulate layer of the Mulga Tank Dunite with drill results of:
0.25 m at 3.80% nickel, 0.70% copper and 0.70 g/t PGE and 0.30 m at 0.70% nickel;
• High grade nickel sulphide in multiple komatiites within a flow channel featuring drill results of:
0.75 m at 0.85% nickel, 0.35% copper and 0.28 g/t PGE, and;
• Disseminated nickel in the Mulga Tank Dunite with drill results of 115 m at 0.30% nickel,
21 m at 0.40% nickel and 59 m at 0.30% nickel.
The style of mineralisation and the nature of the ultramafic rocks are similar to those that host the
significant nickel deposits elsewhere in the Yilgarn Craton, for example, Perseverance (45 Mt at 2.0% Ni),
Rocky’s Reward (9.6 Mt at 2.4% Ni) and Mt Keith (>2 Mt contained nickel).
Impact’s exploration programmes over the past few years for nickel and gold have continued with the
completion of three major geophysical and geochemical surveys: airborne magnetic and radiometric
survey covering much of the project area; an innovative combined ground gravity, EM and airborne
electrical survey (HeliSAM) over the Panhandle and Mulga Tank Dunite prospects; plus 2,500 soil samples
for geochemistry.
This new data has greatly improved the geological understanding of the entire project area and in particular
over the Mulga Tank Dunite where individual geological layers can now for the first time be mapped out
beneath up to 50 metres of sand cover.
A reconnaissance aircore drill programme commenced in August 2018 to test 5 targets for gold
mineralisation and 3 targets for nickel-copper-cobalt mineralisation identified from the geophysical
and geochemical data together with anomalous drill results from previous explorers and work
completed by Impact.
Two of the five gold targets being drilled are conceptual analogues for Gruyere-style gold mineralisation
(5 million ounce gold resource in quartz veins at Gruyere within a layer-parallel granite intrusion Figure 15).
The other three gold targets occur over notable deflections in structures and with evidence of anomalous
gold from previous explorers.
The three nickel targets have been identified as prospective for komatiite and dunite-hosted nickel
sulphide mineralisation.
26 Impact Minerals Ltd | Annual Report 2018
REVIEW OF OPERATIONS (CONTINUED)
The aircore programme is designed to test for gold and nickel dispersion along the unconformity
between the basement and younger cover of sand and alluvium as well as testing for primary
mineralisation in the fresh bedrock.
Figure 16. Location of the Mulga Tank Project. The project covers most of the southern Minigwal
greenstone belt.
Impact Minerals Ltd | Annual Report 2018 27
REVIEW OF OPERATIONS (CONTINUED)
4.
BROKEN HILL PROJECT (IPT 100%)
The Broken Hill Project comprises 727 sq km of exploration licences located southeast of Broken Hill, NSW
and is prospective for: nickel-copper-cobalt-PGE mineralisation associated with ultramafic rocks;
zinc-lead-silver mineralisation hosted by metasedimentary rocks and amphibolite (Broken Hill style); and
pyrite-cobalt deposits similar to Thackaringa (72Mt at 852ppm cobalt, 9.3% sulphur & 10% iron (Figure 17).
Since initially acquiring the project in 2013, Impact has reported several significant high grade drill results
from at least three individual prospects.
At the Red Hill prospect 500 tonnes of ore was mined from Red Hill between 1906 and 1937 and face
samples of old workings assayed from 2% to 4% copper, 2% to 3% nickel, 5g/t to 41g/t PGE and
22g/t to 70g/t silver.
Impact drill hole RHD012 recorded a bonanza drill intersection of 3.5 metres at 5 g/t platinum, 6 g/t gold,
144 g/t palladium, 2.9% nickel, 2.3% copper, 0.2% cobalt and 14.5 g/t silver in heavy matrix sulphide.
RHDH001 intersected 1.9 m at 0.1% cobalt, 2.0% copper, 1.2% nickel, 1.1 g/t platinum, 3.4 g/t palladium,
0.2 g/t gold and 15 g/t silver from 53.7 metres down hole (ASX 23rd October 2015) and RHDH006
intersected 5.2 m at 0.06% cobalt, 1.1% copper, 1.6% nickel, 0.2 g/t gold, 3.9 g/t palladium and
0.8 g/t platinum from 54.2 metres down hole.
The Platinum Springs prospect features high-grade, massive nickel-copper-PGE sulphides with drill hole
PSD02 intersecting 2.75 metres at 3.5 g/t platinum, 7 g/t palladium, 0.4 g/t gold, 2% copper, 1.9% nickel,
0.03% cobalt and 11.6 g/t silver from 55 metres down hole (ASX February 3rd 2016).
The Dora East prospect represents a new discovery of high grade zinc-lead-silver mineralization with
RHD018 intersecting 5.1 metres at 10% zinc, 0.8% lead, 40.4 g/t silver from 148.4 metres in massive
and disseminated sulphides (ASX February 19th 2016). Recent detailed mapping and interpretation of
geophysical data by Impact indicates that Dora East may form within a large fold structure in a similar
fashion to lodes at Broken Hill.
In 2016 Impact re-negotiated an associated JV with Silver City Minerals for Broken Hill-style mineralisation
which entitles Impact to 100% of the PGE-copper-nickel mineralisation and 80% of Broken Hill-style zinc-
lead-silver mineralisation within EL7390.
In July 2018 Impact announced a JV with BlueBird Battery Metals Inc (TSX:V BATT) for BlueBird to farm in
to Impact’s Broken Hill Project (ASX July 11th 2018).
Final paperwork and details of the transaction are being negotiated. However the principal agreed terms of
the Bluebird Battery Metals joint venture are:
•
•
A non-refundable payment of CAD$25,000 cash (completed).
`A cash payment of CAD$125,000 and the issue of 5,250,000 shares (Tranche 1) at a deemed price
of CAD$0.40 (Tranche 1 price) in BlueBird on the later of the signing of a Definitive Agreement (DA)
or the approval of the transaction by the TSX Venture Exchange. The Definitive Agreement is to be
completed within 45 days of signing of the LOI.
•
On-ground exploration expenditures totaling CAD$2.25 million as follows:
- A minimum of CAD$500,000 within one year of signing the DA (Year 1).
- A further CAD$750,000 by the end of Year 2.
- A further CAD$1.00 million by the end of Year 3.
•
The issue of a further $500,000 of shares in Bluebird at a price equivalent to the 30 VWAP at the time
of issue of the shares.
- CAD$125,000 in shares prior to the end of Year 1.
- CAD$125,000 in shares prior to the end of Year 2.
- CAD$250,000 in shares prior to the end of Year 3.
28 Impact Minerals Ltd | Annual Report 2018
REVIEW OF OPERATIONS (CONTINUED)
Figure 17. Image of airborne magnetic data over the Broken Hill region showing Impact’s
Exploration Licences.
Impact Minerals Ltd | Annual Report 2018 29
REVIEW OF OPERATIONS (CONTINUED)
6.
PILBARA GOLD PROJECT
In early August 2017, Impact applied for seven new 100% owned Exploration Licences covering
1,100 sq km of ground prospective for Witwatersrand-style conglomerate-hosted gold in the
Pilbara region of Western Australia.
This followed a review of the discovery of gold in conglomerates at the base of the Fortescue
Group by Artemis Resources Limited and the subsequent joint venture with Novo Resources
Corporation. This work indicated a significant breakthrough had been made in the search for
Witwatersrand-style gold in the Pilbara and Impact immediately applied for available ground
considered prospective for this style of deposit.
Following an approach by Pacton Gold Inc, a company listed on the Toronto Venture Exchange
(TSX:V), Impact agreed to sell 100% of its interests in the new properties for CAD$350,000 and
2,125,000 common shares in Pacton. This deal has now reached completion.
COMPETENT PERSON’S STATEMENT
Exploration Results
The review of exploration activities and results contained in this report is based on information compiled by Dr Mike Jones, a
Member of the Australian Institute of Geoscientists. He is a director of the company and works for Impact Minerals Limited.
He has sufficient experience which is relevant to the style of mineralisation and types of deposits under consideration and to
the activity which he is undertaking to qualify as a Competent Person as defined in the 2012 edition of the Australasian Code
for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the JORC Code). Dr Jones has consented to the
inclusion in the report of the matters based on his information in the form and context in which it appears. Impact Minerals
confirms that it is not aware of any new information or data that materially affects the information included in the previous
market announcements referred to and in the case of mineral resource estimates, that all material assumptions and technical
parameters underpinning the estimates continue to apply and have not materially changed.
Mineral Resources
The information in this report which relates to Mineral Resources is based upon information compiled by Mr Ian Glacken, who
is a Fellow of the Australasian Institute of Mining and Metallurgy. Mr Glacken is an employee of Optiro Pty Ltd and has sufficient
experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which
he is undertaking to qualify as a Competent Person as defined in the 2012 edition of the “Australasian Code for Reporting
of Exploration Results, Mineral Resources and Ore Reserves” (the JORC Code). Mr Glacken consents to disclosure of the
information in this report in the form and context in which it appears.
FORWARD LOOKING STATEMENTS
This document may contain certain forward-looking statements. Forward-looking statements include, but are not limited to
statements concerning Impact Minerals Limited’s (Impact’s) current expectations, estimates and projections about the industry
in which Impact operates, and beliefs and assumptions regarding Impact’s future performance. When used in this document,
words such as “anticipates”, “could”, “plans”, “estimates”, “expects”, “seeks”, “intends”, “may”, “potential”, “should”, and
similar expressions are forward-looking statements. Although Impact believes that its expectations reflected in these forward-
looking statements are reasonable, such statements are subject to known and unknown risks, uncertainties and other factors,
some of which are beyond the control of Impact and no assurance can be given that actual results will be consistent with these
forward-looking statements.
Actual values, results or events may be materially different to those expressed or implied in this document. Given these
uncertainties, recipients are cautioned not to place reliance on forward- looking statements. Any forward-looking statements
in this document speak only at the date of issue of this document. Subject to any continuing obligations under applicable law
and the ASX Listing Rules, Impact does not undertake any obligation to update or revise any information or any of the forward-
looking statements in this document or any changes in events, conditions or circumstances on which any such forward-looking
statement is based.
30 Impact Minerals Ltd | Annual Report 2018
FINANCIAL REPORT
CONTENTS
DIRECTORS’ REPORT
AUDITOR’S INDEPENDENCE DECLARATION
CONSOLIDATED STATEMENT OF PROFIT OR LOSS
AND OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2018
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2018
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2018
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2018
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
DIRECTORS’ DECLARATION
INDEPENDENT AUDITOR’S REPORT
32
46
47
48
49
50
51
88
89
Impact Minerals Ltd | Annual Report 2018 31
DIRECTORS’ REPORT
Your Directors present their report on the consolidated entity consisting of Impact Minerals Limited
and its subsidiaries at the end of the year ended 30 June 2018. Throughout the report, the consolidated
entity is referred to as the Group.
DIRECTORS
The following persons were Directors of Impact Minerals Limited during the whole of the financial
year and up to the date of this report unless noted otherwise:
• Peter Unsworth
• Michael Jones
• Paul Ingram
• Markus Elsasser
• Eamon Hannon (appointed 30 November 2017)
• Felicity Gooding (resigned 30 November 2017)
PRINCIPAL ACTIVITIES
The principal activity of the Group during the financial year was exploration for deposits of nickel,
gold, copper and platinum group elements.
FINANCIAL RESULTS
The consolidated loss of the Group after providing for income tax for the year ended 30 June 2018
was $812,796 (2017: $721,564).
DIVIDENDS
No dividends have been paid or declared since the start of the financial year. No recommendation
for the payment of a dividend has been made by the Directors.
OPERATIONS AND FINANCIAL REVIEW
Activity during the 2018 financial year occurred across Impact’s portfolio with both technical and
commercial success.
Two major drill programmes were undertaken at the 100% owned Commonwealth Project centred
about 100 km north of Orange in NSW, with the second programme recently completed.
Drilling has focussed on extending the high grade mineralisation found previously at the Main Shaft,
Commonwealth South and Silica Hill Prospects.
Two 5km-long trends within Impact’s extensive ground holdings of 1,000 km2 in the area, were
previously identified as prospective for high grade gold and silver deposits similar to Commonwealth-
Silica Hill mineralisation. Detailed studies by Impact have shown strong similarities to the well-known
Eskay Creek deposit in Canada (4 million ounces of gold and 150 million ounces of silver). There is
also potential for the discovery of a porphyry copper-gold system at depth below Silica Hill.
At the 100% owned Clermont project in central Queensland exploration was reinvigorated with the
completion of an IP survey which identified a 6 km trend of quartz veins. Five targets with combined
geophysical and geochemical anomalies were identified and a drill programme to test them was
recently completed. Results are awaited.
32 Impact Minerals Ltd | Annual Report 2018
DIRECTORS’ REPORT (CONTINUED)
During the year Impact also staked new licences in the Pilbara region of WA prospective for
conglomerate-hosted gold and following the mini-gold rush in the region in mid-2017. In September
2018 the licences were sold to Pacton Gold Inc, a TSX:V listed company for CAD$350,000 cash and
2,125,000 shares in Pacton.
Impact also staked one new Exploration Permit and obtained an option over a number of licences at
the Blackridge Project in central Queensland also prospective for conglomerate-hosted gold. This
project will be a key focus for the Company in 2018-2019.
A joint venture with TSX:V-listed BlueBird Battery Metals Corp. on Impact’s 100% owned Broken Hill
project was also announced. A Definitive Agreement for the joint venture is currently being finalised.
BlueBird will expend $2.25 million over 3 years and also issue 5,150,000 shares in BlueBird to earn
75%. A further CAD$500,000 in BlueBird shares will also be due in staged payments over the 3 years
of the agreement.
At the 100% owned Mulga Tank Project in WA 7 priority gold and nickel targets were identified for
first pass drilling. This programme has recently been completed and results are awaited.
Exploration and evaluation costs totalling $228,353 (2017: $101,406) were expensed during the year
in accordance with the Group’s accounting policy. The expensed exploration and evaluation costs
for the year ended 30 June 2018 primarily comprise business development activities on potential
new projects.
As at 30 June 2018, the Group had net assets of $19,522,107 (2017: $12,248,077) including cash and
cash equivalents of $3,514,002 (2017: $1,917,206).
The review of operations contained in this report is based on information compiled by Dr Mike Jones,
a Member of the Australian Institute of Geoscientists. He is a director of the Company and works for
Impact Minerals Limited. He has sufficient experience which is relevant to the style of mineralisation
and types of deposits under consideration and to the activity which he is undertaking to qualify
as a Competent Person as defined in the 2012 edition of the Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserves (the JORC Code). Dr Jones has consented
to the inclusion in the report of the matters based on his information in the form and context in which
it appears.
Impact Minerals confirms that it is not aware of any new information or data that materially affects
the information included in previous market announcements and in the case of mineral resource
estimates, that all material assumptions and technical parameters underpinning the estimates
continue to apply and have not materially changed.
SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS
Significant changes in the state of affairs of the Group during the financial year were as follows:
•
In September 2017 the Company raised $2,927,429 (before costs) via a Shortfall Offer to the
May 2017 Share Purchase Plan. The issue was under the same terms as the Share Purchase
Plan with the issue of 162,634,949 new shares at an issue price of 1.8 cents each together with
three free attaching listed options exercisable at $0.04 on or before 15 June 2020 for every two
new shares subscribed for (243,952,410 Listed Options).
Impact Minerals Ltd | Annual Report 2018 33
DIRECTORS’ REPORT (CONTINUED)
•
•
•
In November 2017, the Company raised $2,499,211 (before costs) via a placement. The Company
issued 124,960,556 new shares at an issue price of 2 cents each together with one free attaching
listed option exercisable at $0.04 on or before 15 June 2020 for every share subscribed for
(124,960,556 Listed Options).
In December 2017, the Company raised $862,500 (before costs) via a placement. The Company
issued 37,500,000 new shares at an issue price of 2.3 cents each together with one free attaching
listed option exercisable at $0.04 on or before 15 June 2020 for every share subscribed for
(37,500,000 Listed Options).
In February 2018 Squadron Resources Pty Ltd (Squadron) elected to convert the $2,000,000 of
Convertible Notes (Notes) that it held in the Company into shares. Pursuant to the terms of the
Notes, Squadron converted the Notes into the Company’s shares at a conversion price of 1.35
cents, being the lower of 2.1 cents per share or 80% of the 30 day Volume Weighted Average
Price prior to the date of the Conversion Notice. Accordingly 148,148,148 shares were issued
to Squadron on conversion of the Notes.
EVENTS SINCE THE END OF THE FINANCIAL YEAR
In July 2018 the Company announced that it had signed a binding Letter of Intent (LOI) to joint venture
its Broken Hill project with TSX Venture exchange-listed BlueBird Battery Metals Incorporated
(Bluebird) (TSX:V BATT). Under the terms of the farm-in Bluebird has the right to earn a 75% interest
in the five Exploration Licences that comprise the Company’s Broken Hill project by the payment
of cash, shares and exploration on-ground expenditure (Refer IPT ASX release dated 11 July 2018
and 1 August 2018).
In September 2018 the Company completed the sale of its 7 Pilbara licences to Pacton Gold Inc.
(Refer to Note 22 for further details.)
Other than the above, there has not arisen in the interval between the end of the financial year and
the date of this report any item, transaction or event of a material and unusual nature likely, in the
opinion of the Directors, to affect significantly the operations, the results of those operations, or the
state of affairs of the Group in future financial years.
LIKELY DEVELOPMENTS AND EXPECTED RESULTS OF OPERATIONS
The Directors are not aware of any developments that might have a significant effect on the operations
of the Group in subsequent financial years not already disclosed in this report.
ENVIRONMENTAL REGULATION
The Group is subject to significant environmental regulation in respect of its exploration activities.
Tenements in Western Australia, New South Wales and Queensland are granted subject to
adherence to environmental conditions with strict controls on clearing, including a prohibition on
the use of mechanised equipment or development without the approval of the relevant government
agencies, and with rehabilitation required on completion of exploration activities. These regulations
are controlled by the Department of Mines and Petroleum (Western Australia), the Department of
Industry, Resources and Energy (New South Wales) and the Department of Natural Resources and
Mines (Queensland).
Impact Minerals Limited conducts its exploration activities in an environmentally sensitive manner
and the Group is not aware of any breach of statutory conditions or obligations.
34 Impact Minerals Ltd | Annual Report 2018
DIRECTORS’ REPORT (CONTINUED)
Greenhouse gas and energy data reporting requirements
The Directors have considered compliance with both the Energy Efficiency Opportunity Act 2006
and the National Greenhouse and Energy Reporting Act 2007 which requires entities to report
annual greenhouse gas emissions and energy use. The Directors have assessed that there are no
current reporting requirements for the year ended 30 June 2018, however reporting requirements
may change in the future.
INFORMATION ON DIRECTORS
Peter Unsworth B.Com (Non-Executive Chairman), Director since 28 April 2006
Experience and expertise Mr Unsworth, formerly a chartered accountant, has more than 35
years’ experience in the corporate finance, investment, and securities
industries and has a wealth of management experience with both public
and private companies. A former Executive Director with a leading
Western Australian stockbroking company, Mr Unsworth has been a
Director of a number of public exploration and mining companies.
He is a Director of the Western Australian Government owned Gold
Corporation (operator of The Perth Mint), having previously been a
Director and Chairman from 1996 to 2008.
Other current
directorships
Stealth Global Holdings Limited
Former directorships in
last three years
None
Special responsibilities
Chair of the Board
Interests in shares and
options
Ordinary shares – Impact Minerals Limited
Listed options – Impact Minerals Limited
Unlisted options – Impact Minerals Limited
15,994,098
3,333,335
8,000,000
Impact Minerals Ltd | Annual Report 2018 35
DIRECTORS’ REPORT (CONTINUED)
Michael Jones PhD, MAIG (Managing Director), Director since 31 March 2006
Experience and expertise Dr Jones completed undergraduate and post-graduate studies in
Mining and Exploration Geology at Imperial College, London. His PhD
work on gold mineralisation saw him move to Western Australia in 1988
to work for Western Mining Corporation exploring for gold and nickel
deposits in the Yilgarn. From 1994, he consulted to the exploration
and mining industry specialising in the integration of geological field
mapping and the interpretation of geochemical, geophysical and
remotely sensed data for target generation.
Dr Jones has worked on over 80 projects both in Greenfields and near
mine exploration in a wide variety of mineralised terrains and was the
founding Director of Lithofire Consulting Geologists in Perth, Australia.
He was also the team leader during the discovery of a significant gold
deposit at the Higginsville Mining Centre, near Kalgoorlie and an iron
ore deposit near Newman, both in Western Australia.
Other current
directorships
Former directorships in
last three years
None
None
Special responsibilities
Managing Director
Interests in shares and
options
Ordinary shares – Impact Minerals Limited
Listed options – Impact Minerals Limited
Unlisted options – Impact Minerals Limited
7,715,052
1,250,0001
20,000,000
Paul Ingram B.AppSc, AIMM, MICA (Non-Executive Director), Director since 27 September 2009
Experience and expertise Mr Ingram is a geologist with extensive experience in managing major
mineral exploration programs for several publicly listed companies
and has been involved in the mining sector for over forty years. He
has designed and implemented innovative techniques for exploration
in remote areas and has managed projects in countries throughout
Australia and east Asia.
Other current
directorships
Former directorships in
last three years
A-Cap Resources Limited (Director since June 2009)
Consolidated Global Investments Limited (Director since September
2006)
Australian Pacific Coal Limited (resigned 30 October 2015)
Special responsibilities
None
Interests in shares and
options
Ordinary shares – Impact Minerals Limited
Unlisted options – Impact Minerals Limited
580,680
4,000,000
36 Impact Minerals Ltd | Annual Report 2018
DIRECTORS’ REPORT (CONTINUED)
Markus Elsasser PhD (Non-Executive Director), Director since 9 August 2012
Experience and expertise Dr Markus Elsasser is a German financier and investor in the mineral
resources industry. He is Head of the Elsasser family office ‘M.
Elsasser & Cie AG 1971’ in Dusseldorf, Germany. Dr Elsasser has
previously been Director of Finance at the Dow Chemical Company
in Germany. He has extensive General Management experience
with former appointments as Managing Director in Australia and
Singapore in the chemical and food industries.
Other current
directorships
None
Former directorships in
last three years
Stellar Resources Limited (resigned 3 February 2016)
Special responsibilities
None
Interests in shares and
options
Ordinary shares – Impact Minerals Limited
Unlisted options – Impact Minerals Limited
23,310,402
4,000,000
Eamon Hannon B.Sc (Geol) (Non-Executive Director), Director since 30 November 2017
Experience and expertise Mr Hannon is a Director of Squadron Resources, a geologist and
Fellow of the AusIMM and has a wealth of experience within the
minerals industry from grass roots exploration through to project
development.
Mr Hannon is currently Managing Director of Buxton Resources
Limited (ASX:BUX). Mr Hannon has also previously worked for
Fortescue Metals Group (ASX: FMG) from early 2004 to late 2012 in
the role of Director, Exploration and Evaluation. During that period
he led the teams to delineate in excess of 10 billion tons of iron ore
resources and greater than 1 billion tons of iron ore reserves.
With over 20 years of experience, Mr Hannon has explored for and
developed gold, base metals and industrial mineral projects in more
than 10 countries across the globe. He was integral to the major
mining development of the Svartliden gold mine in Scandinavia.
Buxton Resources Limited (Managing Director since February 2016)
Other current
directorships
Former directorships in
last three years
None
Special responsibilities
None
Interests in shares and
options
Ordinary shares – Impact Minerals Limited
Unlisted options – Impact Minerals Limited
Nil
Nil
Impact Minerals Ltd | Annual Report 2018 37
DIRECTORS’ REPORT (CONTINUED)
COMPANY SECRETARY
Bernard Crawford B.Com, CA, MBA, ACIS (appointed 4 April 2016)
Mr Crawford is a Chartered Accountant with over 20 years’ experience in the resources industry
in Australia and overseas. He has held various positions in finance and management with NYSE,
TSX and ASX listed companies. Mr Crawford is the CFO and/or Company Secretary of a number
of public companies. He holds a Bachelor of Commerce degree from the University of Western
Australia, a Master of Business Administration from London Business School and is a Member
of Chartered Accountants Australia and New Zealand and the Governance Institute of Australia.
MEETINGS OF DIRECTORS
The number of formal meetings of the Company’s Board of Directors held during the year ended 30
June 2018, and the number of meetings attended by each Director were:
Number of meetings
attended
Number of meetings eligible
to attend
Peter Unsworth
Michael Jones
Paul Ingram
Markus Elsasser
Eamon Hannon
Felicity Gooding
4
4
4
1
3
-
4
4
4
4
3
2
The directors also have a number of informal meetings with management during the year, both in
person and by conference call.
RETIREMENT, ELECTION AND CONTINUATION IN OFFICE OF DIRECTORS
Mr Hannon was appointed to the Board on 30 November 2017 and by virtue of Article 6.3(j) of the Company’s
Constitution and ASX Listing Rule 14.4 will stand for re-election at the Annual General Meeting.
Mr Ingram, being a Director retiring by rotation who, being eligible, will offer himself for re-election
at the Annual General Meeting.
REMUNERATION REPORT (AUDITED)
The Directors present the Impact Minerals Limited 2018 Remuneration Report, outlining key aspects
of our remuneration policy and framework, and remuneration awarded this year.
The report contains the following sections:
a) Key management personnel covered in this report
b) Remuneration governance and the use of remuneration consultants
c) Executive remuneration policy and framework
d) Relationship between remuneration and the Group’s performance
e) Non-executive director remuneration policy
f) Voting and comments made at the Company’s 2017 Annual General Meeting
g) Details of remuneration
h) Service agreements
i) Details of share-based compensation and bonuses
j) Equity instruments held by key management personnel
k) Loans to key management personnel
l) Other transactions with key management personnel.
38 Impact Minerals Ltd | Annual Report 2018
DIRECTORS’ REPORT (CONTINUED)
a)
Key management personnel covered in this report
Non-Executive and Executive Directors (see pages 35 to 37 for details about each
director)
Name
Position
Peter Unsworth
Michael Jones
Paul Ingram
Non-Executive Chairman
Managing Director
Non-Executive Director
Markus Elsasser
Non-Executive Director
Eamon Hannon
Non-Executive Director (appointed 30 November 2017)
Felicity Gooding
Non-Executive Director (resigned 30 November 2017)
Other key management personnel
Name
Position
Bernard Crawford
Company Secretary
b)
Remuneration governance and the use of remuneration consultants
The Company does not have a Remuneration Committee. Remuneration matters are handled
by the full Board of the Company. In this respect the Board is responsible for:
•
•
•
•
the over-arching executive remuneration framework;
the operation of the incentive plans which apply to executive directors and senior
executives (the executive team), including key performance indicators and performance
hurdles;
remuneration levels of executives; and
non-executive director fees.
The objective of the Board is to ensure that remuneration policies and structures are fair and
competitive and aligned with the long-term interests of the Company.
In addition, all matters of remuneration are handled in accordance with the Corporations
Act requirements, especially with regards to related party transactions. That is, none of the
Directors participate in any deliberations regarding their own remuneration or related issues.
Independent external advice is sought from remuneration consultants when required, however
no advice has been sought during the period ended 30 June 2018.
c)
Executive remuneration policy and framework
In determining executive remuneration, the Board aims to ensure that remuneration practices are:
• competitive and reasonable, enabling the Company to attract and retain key talent;
• aligned to the Company’s strategic and business objectives and the creation of shareholder
value;
transparent and easily understood; and
•
• acceptable to shareholders.
Impact Minerals Ltd | Annual Report 2018 39
DIRECTORS’ REPORT (CONTINUED)
All executives receive consulting fees or a salary, part of which may be taken as superannuation,
and from time to time, options. The Board reviews executive packages annually by reference
to the executive’s performance and comparable information from industry sectors and other
listed companies in similar industries.
All remuneration paid to specified executives is valued at the cost to the Group and expensed.
Options are valued using a Black-Scholes option pricing model.
d)
Relationship between remuneration and the Group’s performance
Emoluments of Directors are set by reference to payments made by other companies of
similar size and industry, and by reference to the skills and experience of Directors. Fees
paid to Directors are not linked to the performance of the Group. This policy may change
once the exploration phase is complete and the Group is generating revenue. At present the
existing remuneration policy is not impacted by the Group’s performance including earnings
and changes in shareholder wealth (e.g. changes in share price).
The Board has not set short term performance indicators, such as movements in the
Company’s share price, for the determination of Director emoluments as the Board believes
this may encourage performance which is not in the long-term interests of the Company and
its shareholders. The Board has structured its remuneration arrangements in such a way it
believes is in the best interests of building shareholder wealth in the longer term. The Board
believes participation in the Company’s Incentive Option Scheme motivates key management
and executives with the long-term interests of shareholders.
e)
Non-Executive Director remuneration policy
The Board policy is to remunerate Non-Executive Directors at commercial market rates
for comparable companies for their time, commitment and responsibilities. Non-Executive
Directors receive a Board fee but do not receive fees for chairing or participating on Board
committees. Board members are allocated superannuation guarantee contributions as
required by law, and do not receive any other retirement benefits. From time to time, some
individuals may choose to sacrifice their salary or consulting fees to increase payments
towards superannuation.
The maximum annual aggregate Non-Executive Directors’ fee pool limit is $250,000 as
approved by shareholders at the Company’s 2016 Annual General Meeting (“AGM”) held on
9 November 2016.
Fees for Non-Executive Directors are not linked to the performance of the Group. Non-
Executive Directors’ remuneration may also include an incentive portion consisting of options,
subject to approval by shareholders.
f)
Voting and comments made at the Company’s 2017 Annual General Meeting
Impact Minerals Limited received more than 98% of “yes” votes on its Remuneration Report
for the 2017 financial year. The Company did not receive any specific feedback at the AGM
or throughout the year on its remuneration practices.
g)
Details of remuneration
The following tables show details of the remuneration received by the Group’s key management
personnel for the current and previous financial year.
40 Impact Minerals Ltd | Annual Report 2018
DIRECTORS’ REPORT (CONTINUED)
Short-term
employment benefits
Post-
employment
benefits
Salary &
Fees
$
Non-
monetary
benefit
$
Super-
annuation
$
Share-based payments
Shares
$
Options
$
Total
$
% of
remuneration to
total from shares
and options
%
65,000
273,550
25,000
27,375
14,583
10,417
103,950
519,875
-
-
-
-
-
-
-
-
6,175
-
2,375
-
-
-
-
8,550
-
-
-
-
-
-
-
-
13,234
33,086
6,617
6,617
-
-
-
59,554
84,409
306,636
33,992
33,992
14,583
10,417
103,950
587,979
15.7
10.8
19.5
19.5
-
-
-
Name
2018
Directors
P Unsworth
M Jones
P Ingram
M Elsasser
E Hannon(1)
F Gooding(2)
Executives
B Crawford
TOTALS
(1)
(2)
Appointed 30 November 2017. Mr Hannon’s fees are payable to Squadron Resources Pty Ltd.
Resigned 30 November 2017. Ms Gooding’s fees are payable to Squadron Resources Pty Ltd.
Name
Short-term
employment benefits
Post-
employment
benefits
Salary &
Fees
$
Non-
monetary
benefit
$
Super-
annuation
$
Share-based payments
Shares
$
Options
$
Total
$
% of
remuneration to
total from shares
and options
%
2017
Directors
P Unsworth
65,000
M Jones
P Ingram
M Elsasser
F Gooding(1)
Executives
B Crawford
TOTALS
265,217
25,000
27,375
25,000
103,275
510,867
-
-
-
-
-
-
-
6,175
-
2,375
-
-
-
8,550
-
-
-
-
-
-
-
38,228
95,571
19,114
19,114
-
-
109,403
360,788
46,489
46,489
25,000
103,275
172,027
691,444
34.9
36.6
41.1
41.1
-
-
(1)
Ms Gooding’s fees are payable to Squadron Resources Pty Ltd.
No components of remuneration are linked to the performance of the Group.
Impact Minerals Ltd | Annual Report 2018 41
DIRECTORS’ REPORT (CONTINUED)
h)
Service agreements
M Jones, Managing Director
Dr Jones is remunerated pursuant to an ongoing Consultancy Services Agreement. Dr Jones
was paid fees of $273,550 for the year ended 30 June 2018. The notice period (other than for
gross misconduct) is three months.
B Crawford, Chief Financial Officer and Company Secretary
Mr Crawford is remunerated pursuant to the terms of a Consultancy Agreement to fulfil
the duties of the Company Secretarial and Chief Financial Officer. Fees paid during the
year totalled $103,950 and were charged at usual commercial rates on a daily basis. The
agreement may be terminated by either party on one months’ written notice.
i)
Details of share-based compensation and bonuses
Options
Options over ordinary shares in Impact Minerals Limited are granted under the Employee
Option Acquisition Plan (“Option Plan”). Participation in the Option Plan and any vesting
criteria are at the Board’s discretion and no individual has a contractual right to participate
in the Option Plan or to receive any guaranteed benefits. Any options issued to Directors of
the Company are subject to shareholder approval.
No options were provided as remuneration to Directors and senior management during the
current year.
Further information on the fair value of share options and assumptions is set out in Note 25
to the financial statements.
j)
Equity instruments held by key management personnel
The following tables detail the number of fully paid ordinary shares and options over ordinary
shares in the Company that were held during the financial year and the previous financial
year by key management personnel of the Group, including their close family members and
entities related to them.
42 Impact Minerals Ltd | Annual Report 2018
DIRECTORS’ REPORT (CONTINUED)
Options
Opening
balance at
1 July
2018
Directors
P Unsworth
11,333,335
M Jones
21,250,001
P Ingram
4,000,000
M Elsasser
4,000,000
TOTALS
40,583,336
2017
Directors
P Unsworth 10,000,000
M Jones
25,000,000
P Ingram
5,000,000
M Elsasser
5,000,000
TOTALS
45,000,000
Granted as
remuneration
Options
exercised
Net change
(other)
Balance at
30 June
Vested but
not exercis-
able
Vested and
exercisable
Vested
during
the year
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
11,333,335
21,250,001
4,000,000
4,000,000
40,583,336
1,333,335(1)
11,333,335
(3,749,999)(1)
21,250,001
(1,000,000)
4,000,000
(1,000,000)
4,000,000
(4,416,664)
40,583,336
-
-
-
-
-
-
-
-
-
-
9,333,335
16,250,001
3,000,000
3,000,000
31,583,336
7,333,335
11,250,001
2,000,000
2,000,000
22,583,336
-
-
-
-
-
-
-
-
-
-
(1)
Includes options acquired pursuant to the Share Purchase Plan.
During the year, no ordinary shares in the Company were issued as a result of the exercise
of remuneration options.
Shareholdings
Opening
balance at 1
July
Granted as
remuneration
Options
Exercised
Net change
(other)
Balance
at 30 June
2018
Directors
P Unsworth
15,994,098
7,715,052
580,680
23,310,402
47,600,232
M Jones
P Ingram
M Elsasser
TOTALS
2017
Directors
P Unsworth
13,771,875
M Jones
P Ingram
M Elsasser
TOTALS
6,881,718
580,680
23,310,402
44,544,675
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
15,994,098
7,715,052
580,680
23,310,402
47,600,232
2,222,223
15,994,098
833,334
-
-
7,715,052
580,680
23,310,402
3,055,557
47,600,232
Impact Minerals Ltd | Annual Report 2018 43
DIRECTORS’ REPORT (CONTINUED)
The assessed fair value at grant date of options granted to individuals is allocated equally
over the period from grant date to vesting date, (and the amount included in the remuneration
tables above). Fair values at grant date are determined using a Black-Scholes option pricing
model that takes into account the exercise price, the term of the option, the impact of dilution,
the share price at grant date and expected volatility of the underlying share, the expected
dividend yield and the risk-free interest rate for the term of the option.
As at the date of this report the shareholdings of key management personnel were the same
as at 30 June 2018.
k)
Loans to key management personnel
There were no loans to individuals or members of key management personnel during the
financial year or the previous financial year.
Other transactions with key management personnel
l)
There were no other transactions with key management personnel during the financial year
or the previous financial year.
END OF REMUNERATION REPORT (AUDITED)
SHARES UNDER OPTION
Unissued ordinary shares of the Company under option at the date of this report are as follows:
Date options granted
Expiry date
Issue price
of shares
Number
under option
29 September 2015 and 13 May 2016
29 September 2018
$0.0367
27,000,000
21 October 2015
21 October 2018
$0.0325
26,428,572
29 September 2015 and 13 May 2016
29 September 2019
$0.045
15,500,000
Various (listed)
15 June 2020
29 September 2015 and 13 May 2016
29 September 2020
TOTAL
$0.04
$0.07
499,910,556
15,500,000
584,339,128
No option holder has any right under the options to participate in any other share issue of the
Company or any other entity.
SHARES ISSUED ON THE EXERCISE OF OPTIONS
There were no shares issued on the exercise of options during the year and up to the date of this
report.
CORPORATE GOVERNANCE STATEMENT
The Company’s 2018 Corporate Governance Statement has been released as a separate document and
is located on the Company’s website at http://www.impactminerals.com.au/corporate-governance/.
44 Impact Minerals Ltd | Annual Report 2018
DIRECTORS’ REPORT (CONTINUED)
PROCEEDINGS ON BEHALF OF THE GROUP
No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring
proceedings on behalf of the Company, or to intervene in any proceedings to which the Company
is a party, for the purpose of taking responsibility on behalf of the Company for all or part of those
proceedings.
INDEMNIFICATION AND INSURANCE OF DIRECTORS AND OFFICERS
During the financial year, the Company paid a premium to insure the Directors and Officers of the
consolidated entity against any liability incurred as a Director or Officer to the extent permitted by
the Corporations Act 2001. The contract of insurance prohibits the disclosure of the nature of the
liabilities covered or the amount of the premium paid.
The Group has not entered into any agreement with its current auditors indemnifying them against
claims by a third party arising from their position as auditor.
NON-AUDIT SERVICES
The Company may decide to employ the auditor on assignments additional to their statutory audit
duties where the auditor’s expertise and experience with the Company and/or the Group are important.
Details of the amounts paid or payable to the auditor (Bentleys Audit and Corporate (WA) Pty Ltd) for
audit and non-audit services provided during the year are set out in Note 20. During the year ended
30 June 2018, no fees were paid or were payable for non-audit services provided by the auditor of
the consolidated entity (2017: $Nil).
AUDITOR’S INDEPENDENCE DECLARATION
A copy of the Auditor’s Independence Declaration as required under section 307C of the Corporations
Act 2001 is set out on the following page.
Signed in accordance with a resolution of the Directors.
Peter Unsworth
Chairman
Perth, 21 September 2018
Impact Minerals Ltd | Annual Report 2018 45
To The Board of Directors
Auditor’s Independence Declaration under Section 307C of the
Corporations Act 2001
As lead audit partner for the audit of the financial statements of Impact Minerals Limited
for the financial year ended 30 June 2018, I declare that to the best of my knowledge
and belief, there have been no contraventions of:
the auditor independence requirements of the Corporations Act 2001 in relation to
the audit; and
any applicable code of professional conduct in relation to the audit.
Yours faithfully
BENTLEYS
Chartered Accountants
DOUG BELL CA
Partner
Dated at Perth this 21st day of September 2018
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND
OTHER COMPREHENSIVE INCOME FOR THE YEAR
ENDED 30 JUNE 2018
CONSOLIDATED
Notes
2018
$
3(a)
3(a)
3(b)
11
15
5
Revenue from operating activities
Other income
Corporation and administration expense
Depreciation expense
Employee benefits expense
Impairment of exploration expenditure
Occupancy expense
Financing costs
Loss from continuing operations before
income tax
Income tax expense
Loss after income tax for the period attributable
to the owners of Impact Minerals Limited
Other comprehensive income
Items that may be reclassified to profit or loss
Exchange in the differences on translating foreign
controlled entities
Other comprehensive income for the period
(net of tax)
Total comprehensive loss for the period
attributable to the owners of Impact Minerals
Limited
2017
$
24,001
1,076,238
(688,165)
(1,967)
(779,896)
(101,406)
(48,912)
(201,457)
(721,564)
71,740
670,277
(637,674)
(3,996)
(396,942)
(228,353)
(65,418)
(222,430)
(812,796)
-
-
(812,796)
(721,564)
(926)
(926)
708
708
(813,722)
(720,856)
Cents
per share
Cents
per share
Loss per share attributable to the owners of
Impact Minerals Limited
Basic loss per share
19
(0.07)
(0.09)
The Consolidated Statement of Profit or Loss and Other Comprehensive Income should be read in conjunction with the
accompanying notes.
Impact Minerals Ltd | Annual Report 2018 47
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2018
ASSETS
Current Assets
Cash and cash equivalents
Trade and other receivables
Other current assets
Assets held for sale
Total Current Assets
Non-Current Assets
Property, plant and equipment
Exploration expenditure
Other non-current assets
Total Non-Current Assets
TOTAL ASSETS
LIABILITIES
Current Liabilities
Trade and other payables
Short-term provisions
Financial liabilities
Total Current Liabilities
TOTAL LIABILITIES
NET ASSETS
EQUITY
Issued capital
Option reserve
Foreign currency translation reserve
Transactions with non-controlling interest
Accumulated losses
TOTAL EQUITY
Notes
6
7
8, 15
9
10
11
12, 15
13
14
15
16
17
17
17
18
CONSOLIDATED
2018
$
2017
$
3,514,002
668,167
-
170,763
4,352,932
1,917,206
37,619
201,457
-
2,156,282
9,629
4,635
15,441,823
12,585,274
183,926
193,445
15,635,378
12,783,354
19,988,310
14,939,636
255,325
210,878
-
466,203
466,203
462,313
229,246
2,000,000
2,691,559
2,691,559
19,522,107
12,248,077
44,900,024
36,933,610
1,418,620
(504,820)
1,297,282
(503,894)
(1,161,069)
(1,161,069)
(25,130,648)
(24,317,852)
19,522,107
12,248,077
The Consolidated Statement of Financial Position should be read in conjunction with the accompanying notes.
48 Impact Minerals Ltd | Annual Report 2018
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2018
ATTRIBUTABLE TO THE OWNERS OF IMPACT MINERALS LIMITED
Issued
capital
$
Options
reserve
$
Foreign
currency
translation
reserve
$
Transactions
with non-
controlling
interest
$
Accumulated
losses
$
Total
equity
$
At 1 July 2016
35,950,384 1,222,765
(504,602)
(1,161,069)
(23,817,539) 11,689,939
Total comprehensive loss for
the period
Other comprehensive
income
Exchange differences on
translating foreign controlled
entities
Total comprehensive loss for
the period (net of tax)
Transactions with owners in
their capacity as owners
-
-
-
Shares issued
Share issue costs
1,073,971
(90,745)
-
-
-
-
-
Fair value of options issued
Fair value of options expired
-
-
295,768
(221,251)
-
708
708
-
-
-
-
-
-
-
-
-
-
-
(721,564)
(721,564)
-
708
(721,564)
(720,856)
-
-
-
1,073,971
(90,745)
295,768
221,251
-
36,933,610 1,297,282
(503,894)
(1,161,069)
(24,317,852) 12,248,077
36,933,610 1,297,282
(503,894)
(1,161,069)
(24,317,852) 12,248,077
At 30 June 2017
At 1 July 2017
Total comprehensive loss for
the period
Other comprehensive
income
Exchange differences on
translating foreign controlled
entities
Total comprehensive loss for
the period (net of tax)
Transactions with owners in
their capacity as owners
-
-
-
-
-
-
-
-
-
(926)
(926)
-
-
-
-
-
-
-
-
-
(812,796)
(812,796)
-
(926)
(812,796)
(813,722)
-
-
-
8,289,140
(322,726)
121,338
Shares issued
Share issue costs
8,289,140
(322,726)
Fair value of options issued
-
121,338
At 30 June 2018
44,900,024
1,418,620
(504,820)
(1,161,069)
(25,130,648) 19,522,107
The Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying notes.
Impact Minerals Ltd | Annual Report 2018 49
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2018
CASH FLOWS FROM OPERATING ACTIVITIES
Payments to suppliers and employees
Interest received
Other income received
Research and development tax rebate received
NET CASH FLOWS FROM/(USED IN) OPERATING
ACTIVITIES
CASH FLOWS FROM INVESTING ACTIVITIES
Payments for property, plant and equipment
Payments for exploration activities
NET CASH FLOWS USED IN INVESTING ACTIVITIES
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issue of shares
Share issue costs
NET CASH FLOWS FROM FINANCING ACTIVITIES
Net increase/(decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of the period
CONSOLIDATED
2018
$
2017
$
Notes
(969,169)
(1,050,247)
67,260
25,383
24,001
-
-
1,073,788
26
(876,526)
47,542
(8,990)
(4,167)
(3,496,102)
(3,039,367)
(3,505,092)
(3,043,534)
6,289,140
1,073,971
(310,726)
5,978,414
(90,745)
983,226
1,596,796
(2,012,766)
1,917,206
3,929,972
CASH AND CASH EQUIVALENTS AT END OF PERIOD
6
3,514,002
1,917,206
The Consolidated Statement of Cash Flows should be read in conjunction with the accompanying notes.
50 Impact Minerals Ltd | Annual Report 2018
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
NOTE 1: CORPORATE INFORMATION
The consolidated financial report of Impact Minerals Limited for the year ended 30 June 2018 was
authorised for issue in accordance with a resolution of the Directors on 21 September 2018.
Impact Minerals Limited is a for-profit company incorporated in Australia and limited by shares which
are publicly traded on the Australian Securities Exchange. The nature of the operation and principal
activities of the consolidated entity are described in the attached Directors’ Report.
The principal accounting policies adopted in the preparation of these consolidated financial
statements are set out below and have been applied consistently to all periods presented in the
consolidated financial statements and by all entities in the consolidated entity.
NOTE 2: STATEMENT OF COMPLIANCE
These general purpose financial statements have been prepared in accordance with Australian
Accounting Standards, other authoritative pronouncements of the Australian Accounting Standards
Board, Urgent Issues Group Interpretations and the Corporations Act 2001.
Compliance with IFRS
The consolidated financial statements of Impact Minerals Limited also comply with International
Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board
(“IASB”).
New and amended accounting standards and interpretations adopted by the Group
The following standards relevant to the operations of the Group and effective from 1 July 2017 have
been adopted. The adoption of these standards did not have any impact on the current period or
any prior period and is not likely to affect future periods.
• AASB 2016-1: Amendments to Australian Accounting Standards - Recognition of Deferred Tax
Assets for Unrealised Losses;
• AASB 2016-2: Amendments to Australian Accounting Standards - Disclosure Initiative:
Amendments to AASB 107; and
• AASB 2017-2: Amendments to Australian Accounting Standards - Further Annual Improvements
2014-2016 Cycle.
New accounting standards and interpretations
The following new and amended accounting standards and interpretations relevant to the operations
of the Group have been published but are not mandatory for the current financial year. The Group has
decided against early adoption of these standards and has not yet determined the potential impact
on the financial statements from the adoption of these standards and interpretations.
Impact Minerals Ltd | Annual Report 2018 51
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
The key new standards which may impact the Group in future years are detailed below:
New or revised requirement
AASB 9: Financial Instruments
AASB 9 replaces AASB 139: Financial Instruments: Recognition and Measurement.
The objective of this Standard is to establish principles for the financial reporting
of financial assets and financial liabilities that will present relevant and useful
information to users of financial statements for their assessment of the amounts,
timing and uncertainty of an entity’s future cash flows.
The entity is yet to undertake a detailed assessment of the impact of AASB 9.
However, based on the entity’s preliminary assessment, the Standard is not
expected to have a material impact on the transactions and balances recognised in
the financial statements when it is first adopted for the year ending 30 June 2019.
Application
date of
standard
Application
date for
Group
1 Jan 2018
1 Jul 2018
AASB 15: Revenue from Contracts with Customers
1 Jan 2018
1 Jul 2018
The objective of this Standard is to establish the principles that an entity shall
apply to report useful information to users of financial statements about the nature,
amount, timing and uncertainty of revenue and cash flows arising from a contract
with a customer.
The entity is yet to undertake a detailed assessment of the impact of AASB 15.
However, based on the entity’s preliminary assessment, the Standard is not
expected to have a material impact on the transactions and balances recognised in
the financial statements when it is first adopted for the year ending 30 June 2019.
AASB 2016-5: Amendments to Australian Accounting Standards – Classification
and Measurement of Share-based Payment Transactions
1 Jan 2018
1 Jul 2018
This Standard amends AASB 2: Share-based Payment, clarifying how to account
for certain types of share-based payment transactions. The amendments provide
requirements on the accounting for:
The effects of vesting and non-vesting conditions on the measurement of cash-
settled share-based payments.
Share-based payment transactions with a net settlement feature for withholding tax
obligations.
A modification to the terms and conditions of a share-based payment that changes
the classification of the transaction from cash-settled to equity-settled.
The entity is yet to undertake a detailed assessment of the impact of AASB 2016-
5. However, based on the entity’s preliminary assessment, the Standard is not
expected to have a material impact on the transactions and balances recognised in
the financial statements when it is first adopted for the year ending 30 June 2019.
AASB 16: Leases
1 Jan 2019
1 Jul 2019
This Standard sets out the principles for the recognition, measurement, presentation
and disclosure of leases. The objective is to ensure that lessees and lessors provide
relevant information in a manner that faithfully represents those transactions. This
information gives a basis for users of financial statements to assess the effect that
leases have on the financial position, financial performance and cash flows of an
entity.
The entity is yet to undertake a detailed assessment of the impact of AASB 16.
However, based on the entity’s preliminary assessment, the Standard is not
expected to have a material impact on the transactions and balances recognised in
the financial statements when it is first adopted for the year ending 30 June 2019.
52 Impact Minerals Ltd | Annual Report 2018
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
a) Basis of measurement
Historical cost convention
These consolidated financial statements have been prepared under the historical cost
convention, except where stated.
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
where appropriate.
b) Going concern
These consolidated financial statements have been prepared on the going concern basis,
which contemplates continuity of normal business activities and the realisation of assets and
the settlement of liabilities in the ordinary course of business.
c)
Principles of consolidation
Subsidiaries
The consolidated financial statements incorporate the assets and liabilities of all subsidiaries
of the Company as at 30 June 2018 and the results of all subsidiaries for the year then ended.
The Company and its subsidiaries together are referred to in this financial report as the Group
or the consolidated entity.
Subsidiaries are all entities (including structured entities) over which the Group has control.
The Group controls an entity when the Group is exposed to, or has rights to, variable returns
from its investment with the entity and has the ability to affect those returns through its power
to direct the activities of the entity.
The acquisition method of accounting is used to account for business combinations by the
Group.
Subsidiaries are fully consolidated from the date on which control is transferred to the Group.
They are deconsolidated from the date that control ceases.
Intercompany transactions, balances and unrealised gains on transactions between Group
companies are eliminated. Unrealised losses are also eliminated unless the transaction provides
evidence of an impairment of the transferred asset. Accounting policies of subsidiaries have
been changed where necessary to ensure consistency with the policies adopted by the Group.
Non-controlling interests in the results and equity of subsidiaries are shown separately in the
Consolidated Statement of Profit or Loss and Other Comprehensive Income, Consolidated
Statement of Financial Position, and the Consolidated Statement of Changes in Equity
respectively.
Impact Minerals Ltd | Annual Report 2018 53
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
Joint arrangements
Under AASB 11: Joint Arrangements investments in joint arrangements are classified as either
joint operations or joint ventures. The classification depends on the contractual rights and
obligations of each investor, rather than the legal structure of the joint arrangement.
A joint operation is a joint arrangement whereby the parties that have joint control of the
arrangement have rights to the assets, and obligations for the liabilities, relating to the
arrangement. Those parties are called joint operators. A joint venture is a joint arrangement
whereby the parties that have joint control of the arrangement have rights to the net assets of
the arrangement. Those parties are called joint venturers.
d) Critical accounting judgements and key sources of estimation uncertainty
The application of accounting policies requires the use of judgments, estimates and assumptions
about carrying values of assets and liabilities that are not readily apparent from other sources.
The estimates and associated assumptions are based on historical experience and other factors
that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions are
recognised in the period in which the estimate is revised if it affects only that period, or in the
period of the revision and future periods if the revision affects both current and future periods.
Share-based payment transactions
The Group measures the cost of equity-settled transactions with employees by reference to
the fair value of the equity instruments at the date at which they are granted. The fair value is
determined using a Black-Scholes option pricing model.
Exploration and evaluation costs carried forward
The recoverability of the carrying amount of exploration and evaluation costs carried forward
has been reviewed by the Directors. In conducting the review, if any impairment indicators are
identified, the recoverable amount is then assessed by reference to the higher of “fair value
less costs to sell” and, if applicable, “value in use”.
In determining value in use, future cash flows are based on estimates of ore reserves and
mineral resources for which there is a high degree of confidence of economic extraction,
production and sales levels, future commodity prices, future capital and production costs and
future exchange rates.
Variations to any of these estimates, and timing thereof, could result in significant changes
to the expected future cash flows which in turn could result in significant changes to the
impairment test results, which in turn could impact future financial results.
e) 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, who is responsible for
allocating resources and assessing performance of the operating segments, has been identified
as the Board of Directors of Impact Minerals Limited.
54 Impact Minerals Ltd | Annual Report 2018
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
f)
Functional and presentation of currency
The consolidated financial statements are presented in Australian dollars, which is the Group’s
functional and presentational currency.
Foreign currency transactions are translated into the functional currency using the exchange
rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting
from the settlement of such transactions and from the translation at year end exchange rates
of monetary assets and liabilities denominated in foreign currencies are recognised in profit
or loss, except when they are deferred in equity as qualifying cash flow hedges and qualifying
net investment hedges or are attributable to part of the net investment in a foreign operation.
Foreign exchange gains and losses that relate to borrowings are presented in the Statement of
Profit or Loss and Other Comprehensive Income, within finance costs. All other foreign exchange
gains and losses are presented in the Statement of Profit or Loss and Other Comprehensive
Income on a net basis within other income or other expenses.
Non-monetary items that are measured at fair value in a foreign currency are translated using
the exchange rates at the date when the fair value was determined. Translation differences on
assets and liabilities carried at fair value are reported as part of the fair value gain or loss.
g) Revenue recognition
Revenue is measured at fair value of the consideration received or receivable. Amounts
disclosed as revenue are net of returns, trade allowances, rebates and amounts collected on
behalf of third parties. Interest income is recognised as it accrues.
h)
Income tax
The income tax expense or benefit for the period is the tax payable on the current period’s
taxable income based on the applicable income tax rate for each jurisdiction adjusted by
changes in deferred tax assets and liabilities attributable to temporary differences and to
unused tax losses.
The current income tax charge is calculated on the basis of the tax laws enacted or substantively
enacted at the end of the reporting period. Management periodically evaluates positions
taken in tax returns with respect to situations in which applicable tax regulation is subject to
interpretation. It establishes provisions where appropriate on the basis of amounts expected
to be paid to the tax authorities.
Deferred income tax is provided in full, using the liability method, on temporary differences
arising between the tax bases of assets and liabilities and their carrying amounts in the
consolidated financial statements. However, deferred tax liabilities are not recognised if they
arise from the initial recognition of goodwill. Deferred income tax is also not accounted for if
it arises from initial recognition of an asset or liability in a transaction other than a business
combination that at the time of the transaction affects neither accounting nor taxable profit or
loss. Deferred income tax is determined using tax rates (and laws) that have been enacted or
substantially enacted by the end of the reporting period and are expected to apply when the
related deferred income tax asset is realised or the deferred income tax liability is settled.
Impact Minerals Ltd | Annual Report 2018 55
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
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 assets and liabilities are offset when there is a legally enforceable right to offset
current tax assets and liabilities and when the deferred tax balances relate to the same
taxation authority. Current tax assets and tax liabilities are offset where the entity has a legally
enforceable right to offset and intends either to settle on a net basis, or to realise the asset and
settle the liability simultaneously.
Impact Minerals Limited and its wholly-owned Australian controlled entities have implemented
the tax consolidation legislation. As a consequence, these entities are taxed as a single entity
and the deferred tax assets and liabilities of these entities are set off in the consolidated
financial statements. Current and deferred tax is recognised in profit or loss, except to the
extent that it relates to items recognised in other comprehensive income or directly in equity.
In this case, the tax is also recognised in other comprehensive income or directly in equity,
respectively.
i)
Leases
Leases of property, plant and equipment where the Group, as lessee, has substantially all the
risks and rewards of ownership are classified as finance leases. Finance leases are capitalised
at the lease’s inception at the fair value of the leased property or, if lower, the present value of
the minimum lease payments. The corresponding rental obligations, net of finance charges,
are included in other short-term and long-term payables.
Each lease payment is allocated between the liability and finance cost. The finance cost is
charged to the profit or 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 asset’s useful life or over the
shorter of the asset’s useful life and the lease term if there is no reasonable certainty that the
Group will obtain ownership at the end of the lease term.
Leases in which a significant portion of the risks and rewards of ownership are not transferred to
the Group as lessee are classified as operating leases. Payments made under operating leases
(net of any incentives received from the lessor) are charged to profit or loss on a straight-line
basis over the period of the lease.
j)
Impairment of assets
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 tested 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 inflows
from other assets or groups of assets (cash-generating units). Non-financial assets other than
goodwill that suffered an impairment are reviewed for possible reversal of the impairment at
the end of each reporting period.
56 Impact Minerals Ltd | Annual Report 2018
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
k) Cash and cash equivalents
Cash and cash equivalents includes cash on hand, deposits held at call with financial institutions,
other short-term, highly liquid investments with original maturities of six 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.
l)
Trade and other receivables
Trade receivables are recognised initially at fair value and subsequently measured at amortised
cost using the effective interest method, less provision for impairment. Trade receivables are
due for settlement within 30 days. They are presented as current assets unless collection is
not expected for more than 12 months after the reporting date.
Collectability of trade receivables is reviewed on an ongoing basis. Debts which are known
to be uncollectible are written off by reducing the carrying amount directly. A provision for
doubtful 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 the receivables. The amount
of the provision is the difference between the asset’s carrying amount and the present value
of estimated future cash flows, discounted at the original effective interest rate.
Cash flows relating to short-term receivables are not discounted if the effect of discounting is
immaterial. The amount of the provision is recognised in the profit or loss.
m) Exploration and evaluation expenditure
Exploration and evaluation expenditure, including the costs of acquiring licences and permits,
are capitalised as exploration and evaluation assets on an area of interest basis. Costs incurred
before the Group has obtained the legal rights to explore an area are recognised in the Statement
of Profit or Loss and Other Comprehensive Income.
Exploration and evaluation assets are only recognised if the rights of the area of interest are
current and either:
•
•
the expenditures are expected to be recouped through successful development and
exploitation or from sale of the area of interest; or
activities in the area of interest have not at the reporting date reached a stage which permits
a reasonable assessment of the existence or otherwise of economically recoverable
reserves, and active and significant operations in, or in relation to, the area of interest
are continuing.
Exploration and evaluation assets are assessed for impairment if sufficient data exists to
determine technical feasibility and commercial viability, and facts and circumstances suggest
that the carrying amount exceeds the recoverable amount. For the purposes of impairment
testing, exploration and evaluation assets are allocated to cash-generating units to which the
exploration activity relates. The cash generating unit shall not be larger than the area of interest.
Once the technical feasibility and commercial viability of the extraction of minerals in an area of
interest are demonstrable, exploration and evaluation assets attributable to that area of interest
Impact Minerals Ltd | Annual Report 2018 57
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
are first tested for impairment and then reclassified to mineral property and development assets
within property, plant and equipment.
When an area of interest is abandoned or the Directors decide that it is not commercial, any
accumulated costs in respect of that area are written off in the financial period the decision is made.
n) Property, plant and equipment
Property, plant and equipment is stated at historical cost less accumulated depreciation.
Historical cost includes expenditure that is directly attributable to the acquisition of the items.
The cost of self-constructed assets includes the cost of materials, direct labour, the initial
estimate, where relevant, of the costs of dismantling and removing the items and restoring the
site on which they are located, and an appropriate proportion of production overheads.
Where parts of an item of property, plant and equipment have different useful lives, they are
accounted for as separate items of property, plant and equipment.
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. The carrying
amount of any component accounted for as a separate asset is derecognised when replaced.
All other repairs and maintenance are charged to profit or loss during the reporting period in
which they are incurred.
Depreciation is calculated using the straight-line method to allocate their cost, net of their
residual values, over their estimated useful lives, or in the case of certain leased plant and
equipment, the shorter lease term as follows:
•
•
•
Motor vehicles
Office and computer equipment
Furniture, fittings and equipment
5–7 years
3–5 years
3–5 years
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the
end of each reporting period.
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.
Gains and losses on disposals are determined by comparing proceeds with the carrying amount.
These are included in profit or loss. When re-valued assets are sold, it is Group policy to transfer
any amounts included in other reserves in respect of those assets to retained earnings.
g)
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. The amounts are unsecured and are usually
paid within 30 days of recognition. Trade and other payables are presented as current liabilities
unless payment is not due within 12 months from the reporting date.
58 Impact Minerals Ltd | Annual Report 2018
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
h) Employee benefits
Short-term obligations
Liabilities for wages and salaries, including non-monetary benefits, annual leave and
accumulating sick leave expected to be settled within 12 months after the end of the period
in which the employees render the related service, are recognised in respect of employees’
services up to the end of the reporting period and are measured at the amounts expected to be
paid when the liabilities are settled. The liability for annual leave and accumulating sick leave is
recognised in the provision for employee benefits. Liabilities for non-accumulating sick leave
are recognised when the leave is taken and measured at the rates paid or payable. All other
short-term employee benefit obligations are presented as payables.
The obligations are presented as current liabilities in the Statement of Financial Position if the
entity does not have an unconditional right to defer settlement for at least 12 months after the
reporting date, regardless of when the actual settlement is expected to occur.
Other long-term obligations
The liability for long service leave and annual leave which is not expected to be settled within
12 months after the end of the period in which the employees render the related service,
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 end of the reporting period using the projected unit credit method. Consideration is given
to expected future wage and salary levels, experience of employee departures and periods
of service. Expected future payments are discounted using market yields at the end of the
reporting period on national government bonds with terms to maturity and currency that match,
as closely as possible, the estimated future cash outflows.
Share-based payments
The Group provides benefits to employees of the Company in the form of share options. The fair
value of options granted is recognised as an employee benefits expense with a corresponding
increase in equity. The fair value is measured at grant date and spread over the period during
which the employees become unconditionally entitled to the options. The fair value of the
options granted is measured using a Black-Scholes option pricing model, taking into account
the terms and conditions upon which the options were granted.
The cost of equity-settled transactions is recognised, together with a corresponding increase in
equity, on a straight-line basis over the vesting period. The amount recognised as an expense
is adjusted to reflect the actual number that vest.
The dilutive effect, if any, of outstanding options is reflected as additional share dilution in the
computation of earnings per share.
Impact Minerals Ltd | Annual Report 2018 59
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
Termination benefits
Termination benefits are payable when employment is terminated before the normal retirement
date, or when an employee accepts voluntary redundancy in exchange for these benefits. The
Group recognises termination benefits when it is demonstrably committed to either terminating
the employment of current employees according to a detailed formal plan without possibility
of withdrawal or providing termination benefits as a result of an offer made to encourage
voluntary redundancy. Benefits falling due more than 12 months after the end of the reporting
period are discounted to present value. No termination benefits, other than accrued benefits
and entitlements, were paid during the period.
i)
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, net of tax, from the proceeds.
j)
Earnings per share
Basic earnings per share
Basic earnings per share is calculated by dividing the profit attributable to owners of the Group,
excluding any costs of servicing equity other than ordinary shares by the weighted average
number of ordinary shares outstanding during the financial year, adjusted for bonus elements
in ordinary shares issued during the year and excluding treasury shares.
Diluted earnings per share
Diluted earnings per share adjusts 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 additional ordinary shares that would have been
outstanding assuming the conversion of all dilutive potential ordinary shares.
k) Goods and services tax (GST)
Revenues, expenses and assets are recognised net of the amount of associated 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.
60 Impact Minerals Ltd | Annual Report 2018
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
l)
Financial instruments
Initial recognition and measurement
Financial instruments, including financial assets and financial liabilities, are recognised when the
Group becomes a party to the contractual provisions of the instrument. Trade date accounting
is adopted for financial assets that are delivered within timeframes established by marketplace
convention.
Financial instruments are initially measured at fair value plus transaction costs where the
instrument is not classified as at fair value through profit or loss. Transaction costs related
to instruments classified as at fair value through profit or loss are expensed to profit or loss
immediately. Financial instruments are classified and measured as set out below.
Fair value is determined based on current bid prices for all quoted investments. Valuation
techniques are applied to determine the fair value for all unlisted securities, including recent
arm’s length transactions, reference to similar instruments and option pricing models.
Classification and subsequent measurement
Finance instruments are subsequently measured at either of fair value, amortised cost using the
effective interest rate method, or cost. Fair value represents the amount for which an asset could
be exchanged or a liability settled, between knowledgeable, willing parties. Where available,
quoted prices in an active market are used to determine fair value. In other circumstances,
valuation techniques are adopted.
Amortised cost is the amount at which the financial asset or financial liability is measured at
initial recognition less principal repayments and any reduction for impairment, and adjusted
for any cumulative amortisation of the difference between that initial amount and the maturity
amount calculated using the effective interest method.
Fair value is determined based on current bid prices for all quoted investments. Valuation
techniques are applied to determine the fair value for all unlisted securities, including recent
arm’s length transactions, reference to similar instruments and option pricing models.
The effective interest method is used to allocate interest income or interest expense over
the relevant period and is equivalent to the rate that exactly discounts estimated future cash
payments or receipts (including fees, transaction costs and other premiums or discounts)
through the expected life (or when this cannot be reliably predicted, the contractual term) of
the financial instrument to the net carrying amount of the financial asset or financial liability.
Revisions to expected future net cash flows will necessitate an adjustment to the carrying value
with a consequential recognition of an income or expense in profit or loss.
The Group does not designate any interests in subsidiaries, associates or joint venture entities
as being subject to the requirements of Accounting Standards specifically applicable to financial
instruments.
Impact Minerals Ltd | Annual Report 2018 61
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
i)
Financial assets at fair value through profit or loss
Financial assets are classified at “fair value through profit or loss” when they are held for
trading for the purpose of short term profit taking, where they are derivatives not held for
hedging purposes, or designated as such to avoid an accounting mismatch or to enable
performance evaluation where a group of financial assets is managed by key management
personnel on a fair value basis in accordance with a documented risk management or
investment strategy. Realised and unrealised gains and losses arising from changes in
fair value are included in profit or loss in the period in which they arise.
ii)
Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments
that are not quoted in an active market and are subsequently measured at amortised cost using
the effective interest rate method. Loans and receivables are included in current assets except
those which are expected to mature within 12 months after the end of the reporting period.
iii) Held-to-maturity investments
Held-to-maturity investments are non-derivative financial assets that have fixed maturities
and fixed or determinable payments, and it is the Group‘s intention to hold these
investments to maturity. They are subsequently measured at amortised cost using the
effective interest rate method. Held to maturity investments are included in non-current
assets where they are expected to mature within 12 months after the end of the reporting
period. All other investments are classified as current assets.
iv) Available-for-sale financial assets
Available-for-sale financial assets are non-derivative financial assets that are either
designated as such or that are not classified in any of the other categories. They comprise
investments in the equity of other entities where there is neither a fixed maturity nor fixed
or determinable payments.
They are subsequently measured at fair value with changes in such fair value (i.e. gains
or losses) recognised in other comprehensive income (except for impairment losses
and foreign exchange gains and losses). When the financial asset is derecognised,
the cumulative gain or loss pertaining to that asset previously recognised in other
comprehensive income is reclassified into profit or loss.
Available for sale financial assets are included in non-current assets except those which
are expected to mature within 12 months after the end of the reporting period. All other
financial assets are classified as current assets.
v)
Financial liabilities
Non-derivative financial liabilities (excluding financial guarantees) are subsequently
measured at amortised cost using the effective interest rate method.
62 Impact Minerals Ltd | Annual Report 2018
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
Impairment
At the end of each reporting period, the Group assesses whether there is objective evidence
that a financial instrument has been impaired. In the case of available-for-sale financial
instruments, a prolonged decline in the value of the instrument is considered to determine
whether impairment has arisen. Impairment losses are recognised in the profit or loss. Also,
any cumulative decline in Fair Value previously recognised in other comprehensive income is
reclassified to profit or loss at this point.
De-recognition
Financial assets are derecognised where the contractual rights to receipt of cash flows expire
or the asset is transferred to another party whereby the entity no longer has any significant
continuing involvement in the risks and benefits associated with the asset. Financial liabilities
are derecognised where the related obligations are either discharged, cancelled or expire. The
difference between the carrying value of the financial liability extinguished or transferred to
another party and the fair value of consideration paid, including the transfer of non-cash assets
or liabilities assumed, is recognised in profit or loss.
Financial guarantees
Where material, financial guarantees issued, which require the issuer to make specified
payments to reimburse the holder for a loss it incurs because a specified debtor fails to make
payment when due, are recognised as a financial liability at fair value on initial recognition.
The guarantee is subsequently measured at the higher of the best estimate of the obligation and
the amount initially recognised less, when appropriate, cumulative amortisation in accordance
with AASB 118: Revenue. Where the entity gives guarantees in exchange for a fee, revenue is
recognised under AASB 118.
The fair value of financial guarantee contracts has been assessed using a probability weighted
discounted cash flow approach. The probability has been based on:
•
•
•
the likelihood of the guaranteed party defaulting in a year period;
the proportion of the exposure that is not expected to be recovered due to the guaranteed
party defaulting; and
the maximum loss exposed if the guaranteed party were to default.
u)
Fair value of assets and liabilities
The Group measures some of its assets and liabilities at fair value on either a recurring or
nonrecurring basis, depending on the requirements of the applicable Accounting Standard.
Fair value is the price the Group would receive to sell an asset or would have to pay to transfer
a liability in an orderly (i.e. unforced) transaction between independent, knowledgeable and
willing market participants at the measurement date.
Impact Minerals Ltd | Annual Report 2018 63
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
As fair value is a market-based measure, the closest equivalent observable market pricing
information is used to determine fair value. Adjustments to market values may be made having
regard to the characteristics of the specific asset or liability. The fair values of assets and
liabilities that are not traded in an active market are determined using one or more valuation
techniques. These valuation techniques maximise, to the extent possible, the use of observable
market data.
To the extent possible, market information is extracted from either the principal market for
the asset or liability (i.e. the market with the greatest volume and level of activity for the asset
or liability) or, in the absence of such a market, the most advantageous market available to
the entity at the end of the reporting period (i.e. the market that maximises the receipts from
the sale of the asset or minimises the payments made to transfer the liability, after taking into
account transaction costs and transport costs).
For non-financial assets, the fair value measurement also takes into account a market
participant’s ability to use the asset in its highest and best use or to sell it to another market
participant that would use the asset in its highest and best use.
The fair value of liabilities and the entity’s own equity instruments (excluding those related to
share-based payment arrangements) may be valued, where there is no observable market
price in relation to the transfer of such financial instruments, by reference to observable market
information where such instruments are held as assets. Where this information is not available,
other valuation techniques are adopted and, where significant, are detailed in the respective
note to the financial statements.
Valuation techniques
In the absence of an active market for an identical asset or liability, the Group selects and uses
one or more valuation techniques to measure the fair value of the asset or liability, The Group
selects a valuation technique that is appropriate in the circumstances and for which sufficient
data is available to measure fair value. The availability of sufficient and relevant data primarily
depends on the specific characteristics of the asset or liability being measured. The valuation
techniques selected by the Group are consistent with one or more of the following valuation
approaches:
•
•
•
Market approach: valuation techniques that use prices and other relevant information
generated by market transactions for identical or similar assets or liabilities.
Income approach: valuation techniques that convert estimated future cash flows or
income and expenses into a single discounted present value.
Cost approach: valuation techniques that reflect the current replacement cost of an asset
at its current service capacity.
Each valuation technique requires inputs that reflect the assumptions that buyers and sellers
would use when pricing the asset or liability, including assumptions about risks. When selecting
a valuation technique, the Group gives priority to those techniques that maximise the use of
observable inputs and minimise the use of unobservable inputs. Inputs that are developed
using market data (such as publicly available information on actual transactions) and reflect
the assumptions that buyers and sellers would generally use when pricing the asset or liability
are considered observable, whereas inputs for which market data is not available and therefore
are developed using the best information available about such assumptions are considered
unobservable.
64 Impact Minerals Ltd | Annual Report 2018
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
Fair value hierarchy
AASB 13: Fair Value Measurement requires the disclosure of fair value information by level of
the fair value hierarchy, which categorises fair value measurements into one of three possible
levels based on the lowest level that an input that is significant to the measurement can be
categorised into as follows:
•
•
•
Level 1: Measurements based on quoted prices (unadjusted) in active markets for identical
assets or liabilities that the entity can access at the measurement date. Measurements
based on inputs other than quoted prices included in Level 1 that are observable for the
asset or liability, either directly or indirectly.
Level 2: Measurements based on inputs other than quoted prices included in Level 1 that
are observable for the asset or liability, either directly or indirectly.
Level 3: Measurements based on unobservable inputs for the asset or liability.
The fair values of assets and liabilities that are not traded in an active market are determined
using one or more valuation techniques. These valuation techniques maximise, to the extent
possible, the use of observable market data. If all significant inputs required to measure fair
value are observable, the asset or liability is included in Level 2. If one or more significant inputs
are not based on observable market data, the asset or liability is included in Level 3.
The Group would change the categorisation within the fair value hierarchy only in the following
circumstances:
•
•
if a market that was previously considered active (Level 1) became inactive (Level 2 or
Level 3) or vice versa; or
if significant inputs that were previously unobservable (Level 3) became observable (Level
2) or vice versa.
When a change in the categorisation occurs, the Group recognises transfers between levels
of the fair value hierarchy (i.e. transfers into and out of each level of the fair value hierarchy) on
the date the event or change in circumstances occurred.
Impact Minerals Ltd | Annual Report 2018 65
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
NOTE 3: REVENUE AND EXPENSES
a) Revenue from operating activities
Interest income
Other income
Research and development tax rebate
Total revenue from operating activities
b) Employee benefits expense
Wages, salaries and other remuneration expenses
Directors’ fees
Superannuation fund contributions
Share-based payment expense
Total employee benefits expense
CONSOLIDATED
2018
$
71,740
25,383
644,894
742,017
127,484
142,375
17,745
109,338
396,942
2017
$
24,001
2,450
1,073,788
1,100,239
323,075
142,375
18,678
295,768
779,896
66 Impact Minerals Ltd | Annual Report 2018
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
NOTE 4: SEGMENT INFORMATION
The Group has identified its operating segments based on the internal reports that are reviewed
and used by the Board of Directors (chief operating decision makers) in assessing performance and
determining the allocation of resources. The Group is managed primarily on the basis of exploration
opportunities within Australia and Africa. Operating segments are therefore determined on this basis.
Reportable segments disclosed are based on aggregating operating segments where the segments
are considered to have similar geographic characteristics.
Australia
$
Africa
$
Corporate
$
Consolidated
$
2018
Segment performance
Segment income
Segment expense
-
-
742,017
228,353
21,769
1,304,691
Profit/(Loss) before tax
(228,353)
(21,769)
(562,674)
742,017
1,554,813
(812,796)
15,441,823
2,178
4,544,309
19,988,310
49,834
-
416,369
466,203
15,391,989
2,178
4,127,940
19,522,107
Segment assets and liabilities
Assets
Liabilities
Net assets
2017
Segment performance
Segment income
Segment expense
-
-
1,100,239
101,406
60,424
1,659,973
1,100,239
1,821,803
(721,564)
Profit/(Loss) before tax
(101,406)
(60,424)
(559,734)
Segment assets and liabilities
Assets
Liabilities
Net assets
12,585,274
276,859
12,308,415
18,898
3,411
15,487
2,335,464
14,939,636
2,411,289
2,691,559
(75,825)
12,248,077
Impact Minerals Ltd | Annual Report 2018 67
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
NOTE 5: INCOME TAX
a) Major components of income tax expense are as follows:
Current income tax expense/(benefit)
Deferred income tax expense/(benefit)
Income tax expense reported in the Consolidated Statement
of Profit or Loss and Other Comprehensive Income
b) The prima facie tax on loss from ordinary activities before
income tax is reconciled to the income tax as follows:
CONSOLIDATED
2018
$
2017
$
-
-
-
-
-
-
Profit from ordinary activities before income tax expense
(812,796)
(721,564)
Prima facie tax benefit on profit from ordinary activities
before income tax at 27.5% (2017: 27.5%)
Tax effect of permanent differences:
- Share-based expense
- Non-deductible expenses
- Government grant received
- Tax losses not recognised
- Foreign tax rate difference
Income tax expense/(benefit) on pre-tax profit
c) Deferred tax assets and (liabilities) are attributable
to the following:
Accrued expenses
Capital raising costs
Exploration expenditure
Plant and equipment
Provision for employee entitlement
Other
Tax losses
d) Unrecognised deferred tax assets
Deferred tax assets have not been recognised in respect
of the following items as the Directors do not believe it is
appropriate to regard realisation of future tax benefits as
probable:
- Tax losses
- Capital losses
68 Impact Minerals Ltd | Annual Report 2018
(223,519)
(198,430)
30,068
70,668
(177,346)
298,932
1,197
-
81,336
69,041
(295,292)
340,022
3,323
-
9,936
34,325
6,429
57,557
(3,588,279)
(2,797,320)
3,357
54,826
48
6,325
52,128
4,211
3,485,787
2,670,670
-
-
3,635,145
651,887
4,287,032
3,376,557
651,887
4,028,444
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
NOTE 6: CASH AND CASH EQUIVALENTS
Cash at bank and on hand
Short-term deposits
CONSOLIDATED
2018
$
2017
$
514,002
1,917,206
3,000,000
3,514,002
-
1,917,206
The weighted average interest rate for the year was 1.93% (2017: 1.19%).
The Group’s exposure to interest rate risk is set out in Note 24. The maximum exposure to credit risk at the
end of the reporting period is the carrying amount of each class of cash and cash equivalents mentioned
above.
NOTE 7: TRADE AND OTHER RECEIVABLES
Current
Research and development tax rebate
GST/VAT
Other
CONSOLIDATED
2018
$
644,894
17,827
5,446
668,167
2017
$
-
35,358
2,261
37,619
The amounts held in trade and other receivables do not contain impaired assets and are not past
due. Based on the credit history of these trade and other receivables, it is expected that these
amounts will be received when due. The Group’s financial risk management objectives and policies
are set out in Note 24.
Due to the short-term nature of these receivables, their carrying value is assumed to approximate
their fair value.
NOTE 8: OTHER CURRENT ASSETS
Current portion of unamortised option cost
CONSOLIDATED
2018
$
-
-
2017
$
201,457
201,457
Refer to Note 15 for details of the transaction costs related to the issue of options to Squadron
Resources Pty Ltd.
Impact Minerals Ltd | Annual Report 2018 69
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
NOTE 9: ASSETS HELD FOR SALE
Tenements held for sale
CONSOLIDATED
2018
$
170,763
170,763
2017
$
-
-
The tenements subject to the Share Sale Agreement with Pacton Gold Incorporated for the sale of
the Company’s Pilbara gold project are held at their carrying value (refer Note 11). The sale of the
tenements was completed in September 2018 (refer Note 22 for further details).
NOTE 10: PROPERTY, PLANT AND EQUIPMENT
CONSOLIDATED
2018
$
7,400
(7,203)
197
67,076
(66,408)
668
32,253
(27,275)
4,978
143,135
(139,349)
3,786
9,629
2017
$
7,400
(6,612)
788
67,076
(65,813)
1,263
26,621
(26,089)
532
139,777
(137,725)
2,052
4,635
Leasehold improvements
- At cost
- Accumulated depreciation
Total leasehold improvements
Office equipment
- At cost
- Accumulated depreciation
Total office equipment
Site equipment
- At cost
- Accumulated depreciation
Total site equipment
Computer equipment
- At cost
- Accumulated depreciation
Total computer equipment
Total property, plant and equipment
70 Impact Minerals Ltd | Annual Report 2018
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
NOTE 10: PROPERTY, PLANT AND EQUIPMENT (Continued)
Movement in carrying amounts
Movements in the carrying amounts for each class of property, plant and equipment between the
beginning and the end of the year:
Leasehold
improvements
$
Office
equipment
$
Site
equipment
$
Computer
equipment
$
Total
$
2018 – Consolidated
Balance at the beginning of the year
Additions
Depreciation expense
Carrying amount at the end of the year
2017 – Consolidated
Balance at the beginning of the year
Additions
Depreciation expense
Carrying amount at the end of the year
788
-
(591)
197
1,528
-
(740)
788
1,263
-
(595)
668
-
1,588
(325)
1,263
532
5,632
(1,186)
4,978
907
-
(375)
532
2,052
3,358
(1,624)
3,786
-
2,579
(527)
2,052
4,635
8,990
(3,996)
9,629
2,435
4,167
(1,967)
4,635
NOTE 11: EXPLORATION AND EVALUATION
Opening balance
Exploration expenditure incurred during the year
Transfers to assets held for sale (refer Note 9)
Impairment expense
Closing balance
CONSOLIDATED
2018
$
12,585,274
3,255,665
(170,763)
(228,353)
2017
$
9,749,914
2,936,766
-
(101,406)
15,441,823
12,585,274
Exploration and evaluation expenditure incurred is accumulated in respect of each identifiable area
of interest. These costs are only carried forward to the extent that they are expected to be recouped
through the successful development of the area or where activities in the area have not yet reached
a stage that permits reasonable assessment of the existence of economically recoverable reserves.
Impact Minerals Ltd | Annual Report 2018 71
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
NOTE 12: OTHER NON-CURRENT ASSETS
Non-current portion of unamortised option cost
Deposits paid
Other non-current assets
Closing balance
CONSOLIDATED
2018
$
-
174,494
9,432
183,926
2017
$
20,973
163,068
9,404
193,445
Refer to Note 15 for details of the transaction costs related to the issue of options to Squadron
Resources Pty Ltd.
NOTE 13: TRADE AND OTHER PAYABLES
Trade creditors
Other payables and accruals
CONSOLIDATED
2018
$
196,155
59,170
255,325
2017
$
403,597
58,716
462,313
Trade creditors are non-interest bearing and are normally settled on 30-day terms. The Group’s
financial risk management objectives and policies are set out in Note 24. Due to the short-term nature
of these payables, their carrying value is assumed to approximate their fair value.
NOTE 14: PROVISIONS
Short-term
Employee entitlements
NOTE 15: FINANCIAL LIABILITIES
Convertible notes
72 Impact Minerals Ltd | Annual Report 2018
CONSOLIDATED
2018
$
210,878
210,878
2017
$
229,246
229,246
CONSOLIDATED
2018
$
-
-
2017
$
2,000,000
2,000,000
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
NOTE 15: FINANCIAL LIABILITIES (Continued)
2,000,000 Convertible Notes (Notes) were issued to Squadron Resources Pty Ltd (Squadron) on 7
August 2015 at an issue price of $1 per Note. Each Note carries the entitlement for conversion to
one ordinary share in the Company.
Conversion may occur at any time between 7 August 2015 and 7 August 2018. The convertible
notes do not carry interest and can only be redeemed through the issue of shares, except in remote
circumstances that are not at the discretion of the note holder.
In February 2018 Squadron elected to convert the $2,000,000 of Notes that it held in the Company
into shares. Pursuant to the terms of the Notes, Squadron converted the Notes into the Company’s
shares at a conversion price of 1.35 cents, being the lower of 2.1 cents per share or 80% of the 30 day
Volume Weighted Average Price prior to the date of the Conversion Notice. Accordingly 148,148,148
shares were issued to Squadron on conversion of the Notes.
Included in other assets in the prior period are transaction costs relating to the Notes and represent
the fair value of the attaching 45,000,000 options issued which are convertible at 3.25 cents per
option and deemed to have a fair value of 1.34 cents per option. These transaction costs have been
amortised over the life of the Notes.
Transaction costs
Share-based payment – options granted
Option cost unwound in prior periods
Option cost unwound during the period
Total transaction costs to be amortised over the life of the
convertible note
The balance has been classified as follows:
- Other current assets (refer Note 8)
- Other non-current assets (refer Note 12)
CONSOLIDATED
2018
$
604,922
(382,492)
(222,430)
-
-
-
-
2017
$
604,922
(181,035)
(201,457)
222,430
201,457
20,973
222,430
Impact Minerals Ltd | Annual Report 2018 73
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
NOTE 16: CONTRIBUTED EQUITY
a)
Share capital
Ordinary shares fully paid
b)
Movements in ordinary shares on issue
Balance at 1 July 2016
Share issued during the year:
- Share purchase plan and shortfall offer (a)
- Transaction costs
Balance at 30 June 2017
Share issued during the year:
- Shortfall issue (b)
- Placement (c)
- Placement (d)
- Conversion of convertible notes (e)
- Transaction costs
Balance at 30 June 2018
CONSOLIDATED
2018
$
2017
$
44,900,024
36,933,610
CONSOLIDATED
Number
$
788,771,085
35,950,384
59,665,051
-
1,073,971
(90,745)
848,436,136
36,933,610
162,634,949
124,960,556
37,500,000
148,148,148
-
2,927,429
2,499,211
862,500
2,000,000
(322,726)
1,321,679,789
44,900,024
(a) In June 2017 the Company completed a Share Purchase Plan and Shortfall Offer raising $1,073,971 (before costs) via the issue
of 59,665,051 new shares at an issue price of 1.8 cents each together with three free attaching listed options exercisable at
$0.04 on or before 15 June 2020 for every two new shares subscribed for (89,497,500 Listed Options).
(b) In September 2017 the Company raised $2,927,429 (before costs) via a Shortfall Offer to the May 2017 Share Purchase Plan.
The issue was under the same terms as the Share Purchase Plan with the issue of 162,634,949 new shares at an issue price of
1.8 cents each together with three free attaching listed options exercisable at $0.04 on or before 15 June 2020 for every two
new shares subscribed for (243,952,410 Listed Options).
(c) In November 2017, the Company raised $2,499,211 (before costs) via a placement. The Company issued 124,960,556 new shares
at an issue price of 2 cents each together with one free attaching listed option exercisable at $0.04 on or before 15 June 2020
for every share subscribed for (124,960,556 Listed Options).
(d) In December 2017, the Company raised $862,500 (before costs) via a placement. The Company issued 37,500,000 new shares
at an issue price of 2.3 cents each together with one free attaching listed option exercisable at $0.04 on or before 15 June 2020
for every share subscribed for (37,500,000 Listed Options).
(e) In February 2018 Squadron Resources Pty Ltd (Squadron) elected to convert the $2,000,000 of Convertible Notes (Notes) that it
held in the Company into shares. Pursuant to the terms of the Notes, Squadron converted the Notes into the Company’s shares
at a conversion price of 1.35 cents, being the lower of 2.1 cents per share or 80% of the 30 day Volume Weighted Average Price
prior to the date of the Conversion Notice. Accordingly 148,148,148 shares were issued to Squadron on conversion of the Notes.
74 Impact Minerals Ltd | Annual Report 2018
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
NOTE 16: CONTRIBUTED EQUITY (Continued)
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.
c)
Movements in options on issue
CONSOLIDATED
2018
Number
2017
Number
Balance at beginning of the financial year
218,926,162
141,828,572
Options issued pursuant to the Share Purchase Plan (listed)
-
89,497,590
Options issued pursuant to the Shortfall offer (listed)
Options issued pursuant to Placement (listed)
Options issued to lead manager of placement (listed)
Options granted
Options expired
243,952,410
162,460,556
4,000,000
-
-
-
-
-
-
(12,400,000)
Balance at the end of the financial year
629,339,128
218,926,162
NOTE 17: RESERVES
Option reserve
Opening balance
Fair value of options issued
Transfer to retained earnings upon expiry/lapse of options
Balance at the end of the financial year
CONSOLIDATED
2018
$
2017
$
1,297,282
121,338
-
1,418,620
1,222,765
295,768
(221,251)
1,297,282
The options reserve is used to recognise the fair value of options issued to employees and contractors.
Foreign currency translation reserve
The foreign currency translation reserve records exchange differences arising on translation of a
foreign controlled subsidiary.
Transactions with non-controlling interest
The transactions with non-controlling interest reserve records items related to the acquisition of
shares in Invictus Gold Limited.
Impact Minerals Ltd | Annual Report 2018 75
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
NOTE 18: ACCUMULATED LOSSES
CONSOLIDATED
2018
$
2017
$
Balance at the beginning of the financial year
(24,317,852)
(23,817,539)
Net loss attributable to members
Transfer from share option reserve upon lapse of options
Balance at the end of the financial year
(812,796)
-
(721,564)
221,251
(25,130,648)
(24,317,852)
NOTE 19: EARNINGS PER SHARE
Basic loss per share
2018
Cents
0.07
2017
Cents
0.09
The following reflects the income and share data used in the calculations of basic loss per share:
Profits/(losses) used in calculating basic and diluted
earnings per share
2018
$
2017
$
(812,796)
(721,564)
2018
Number
2017
Number
Weighted average number of ordinary shares used in
calculating
basic loss per share
1,137,553,715
790,242,278
NOTE 20: AUDITOR’S REMUNERATION
Audit services
Bentleys Audit and Corporate (WA) Pty Ltd
- Audit and review of the financial reports
Total remuneration
76 Impact Minerals Ltd | Annual Report 2018
CONSOLIDATED
2018
$
2017
$
34,000
34,000
32,000
32,000
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
NOTE 21: CONTINGENT ASSETS AND LIABILITIES
The Group had contingent liabilities in respect of:
Future royalty payments
In March 2016, Impact Minerals Limited completed the acquisition of tenement E7390 from Golden Cross
Resources Limited (“Golden Cross”) for $60,000 cash. Golden Cross retains a royalty equal to 1% of
gross revenue on any minerals recovered from the tenement. At its election, Impact has the right to buy
back the royalty for $1.5 million cash at any time up to a decision to mine, or, leave the royalty uncapped
during production.
NOTE 22: EVENTS OCCURRING AFTER THE REPORTING PERIOD
In July 2018 the Company announced that it had signed a binding Letter of Intent (LOI) to joint venture
its Broken Hill project with TSX Venture exchange-listed BlueBird Battery Metals Incorporated (Bluebird)
(TSX:V BATT). Under the terms of the farm-in Bluebird has the right to earn a 75% interest in the five
Exploration Licences that comprise the Company’s Broken Hill project by the payment of cash, shares
and exploration on-ground expenditure.
In September 2018 the Company completed the sale of its wholly owned subsidiary Drummond East
Pty Ltd, the holder of its 7 Pilbara licences, to Pacton Gold Inc. (Pacton). Under the terms of the Sale
Agreement the Company was paid a total of CAD$325,000 in cash and 2,125,000 common shares in
Pacton. The shares are subject to a four month escrow period.
Pacton must also pay a CAD$500,000 Bonus to the Company upon publishing a measured, indicated or
inferred gold resource of more than 250,000 ounces on the licences. The Company retains a 2% NSR
royalty on the licences with Pacton retaining the right to buy back 1% of the royalty for CAD$500,000
at anytime.
There have been no other events subsequent to reporting date which are sufficiently material to warrant
disclosure.
NOTE 23: COMMITMENTS
In order to maintain an interest in the exploration tenements in which the Group is involved, the Group
is committed to meet the conditions under which the tenements were granted. The timing and amount
of exploration expenditure commitments and obligations of the Group are subject to the minimum
expenditure commitments required as per the Mining Act 1978 (Western Australia), the Mining Act 1992
(New South Wales) and the Mineral Resources Act 1989 (Queensland) and may vary significantly from
the forecast based upon the results of the work performed which will determine the prospectivity of the
relevant area of interest.
As at balance date, total exploration expenditure commitments on granted tenements held by the Group
that have not been provided for in the financial statements and which cover the following 12 month period
amount to $1,115,434 (2017: $867,020). For the period greater than 12 months to five years, commitments
amount to $6,597,992 (2017: $2,174,567). There are no commitments greater than five years. These
obligations are also subject to variations by farm-out arrangements, or sale of the relevant tenements.
Impact Minerals Ltd | Annual Report 2018 77
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
NOTE 23: COMMITMENTS (Continued)
Commitments in relation to the lease of office premises are payable as follows:
Within one year
Later than one year but not later than five years
Later than five years
CONSOLIDATED
2018
$
43,640
40,004
-
83,644
2017
$
39,600
-
-
39,600
NOTE 24: FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
Financial risk management
Overview
The Group has exposure to the following risks from their use of financial instruments:
Interest rate risk
•
• Credit risk
• Liquidity risk
• Commodity risk.
This note presents information about the Group’s exposure to each of the above risks, their objectives,
policies and processes for measuring and managing risk, and the management of capital.
The Board of Directors has overall responsibility for the establishment and oversight of the risk
management framework.
Risk management policies are established to identify and analyse the risks faced by the Group, to set
appropriate risk limits and controls, and to monitor risks and adherence to limits. Risk management
policies and systems are reviewed regularly to reflect changes in market conditions and the Group’s
activities.
The Board oversees how management monitors compliance with the Group’s risk management
policies and procedures and reviews the adequacy of the risk management framework in relation to
the risks faced by the Group.
The Group’s principal financial instruments are cash, short-term deposits, receivables and payables.
Interest rate risk
Interest rate risk is the risk that the value of a financial instrument or cash flows associated with
the instrument will fluctuate due to changes in market interest rates. Interest rate risk arises from
fluctuations in interest-bearing financial assets and liabilities that the Group uses.
78 Impact Minerals Ltd | Annual Report 2018
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
NOTE 24: FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (Continued)
Interest-bearing assets comprise cash and cash equivalents which are considered to be short-term
liquid assets. It is the Group’s policy to settle trade payables within the credit terms allowed and
therefore not incur interest on overdue balances.
The following table sets out the carrying amount, by maturity, of the financial instruments that are
exposed to interest rate risk:
Floating
interest
rate
$
Fixed interest rate maturing in
1 year or
less
$
Over 1 to
5 years
$
More than
5 years
$
Non-
interest
bearing
$
Total
$
Consolidated – 2018
Financial assets
Cash and cash equivalents
514,002 3,000,000
Trade and other receivables
-
-
514,002 3,000,000
Weighted average interest rate
1.33%
2.33%
Financial liabilities
Trade and other payables
Financial liabilities
Weighted average interest rate
Consolidated – 2017
Financial assets
-
-
-
-
Cash and cash equivalents
1,917,206
Trade and other receivables
-
Weighted average interest rate
1.19%
1,917,206
Financial liabilities
Trade and other payables
Financial liabilities
Weighted average interest rate
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
3,514,002
668,167
668,167
668,167
4,182,169
-
-
255,325
255,325
-
-
255,325
255,325
-
-
-
1,917,206
37,619
37,619
37,619
1,954,825
-
-
462,313
462,313
2,000,000
2,000,000
2,462,313
2,462,313
-
-
Impact Minerals Ltd | Annual Report 2018 79
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
NOTE 24: FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (Continued)
Fair value sensitivity analysis for fixed rate instruments
The Group does not account for any fixed rate financial assets or liabilities at fair value through profit
or loss. Therefore, a change in interest rates at the reporting date would not affect profit or loss.
Cash flow sensitivity analysis for variable rate instruments
A change of 100 basis points in interest rates at the reporting date would have increased/(decreased)
equity and profit or loss by the amounts shown below:
Profit or loss
Equity
Carrying value
at period end
$
100 bp
increase
$
100 bp
decrease
$
100 bp
increase
$
100 bp
decrease
$
Consolidated – 2018
Financial assets
Cash and cash equivalents
3,514,002
Cash flow sensitivity (net)
Consolidated – 2017
Financial assets
37,115
37,115
(37,115)
(37,115)
37,115
37,115
(37,115)
(37,115)
Cash and cash equivalents
1,917,206
Cash flow sensitivity (net)
20,088
20,088
(20,088)
(20,088)
20,088
20,088
(20,088)
(20,088)
Credit risk
Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial
instrument fails to meet its contractual obligations, and arises principally from the Group’s receivables
from customers and investment securities. The Group trades only with recognised, creditworthy third
parties. It is the Group policy that all customers who wish to trade on credit terms are subject to
credit verification procedures. In addition, receivable balances are monitored on an ongoing basis
with the result that the Group’s exposure to bad debts is not significant. The maximum exposure to
credit risk is the carrying value of the receivable, net of any provision for doubtful debts.
With respect to credit risk arising from the other financial assets of the Group, which comprise cash
and cash equivalents, the Group’s exposure to credit risk arises from default of the counter party,
with a maximum exposure equal to the carrying amount of these instruments. This risk is minimised
by reviewing term deposit accounts from time to time with approved banks of a sufficient credit
rating which is AA and above.
Exposure to credit risk
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:
80 Impact Minerals Ltd | Annual Report 2018
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
NOTE 24: FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (Continued)
Cash and cash equivalents
Trade and other receivables
Foreign currency risk
CONSOLIDATED
2018
$
3,514,002
668,167
4,182,169
2017
$
1,917,206
37,619
1,954,825
Exposure to foreign exchange risk may result in the fair value or future cash flows of a financial
instrument fluctuating due to movement in foreign exchange rates of currencies in which the Group
holds financial instruments which are other than the AUD functional currency of the Group.
The Group is exposed to fluctuations in foreign currencies arising from the purchase of goods and
services in currencies other than the Company’s measurement currency (namely $USD and Botswana
Pula). The Group’s exposure to foreign currency risk is minimal at this stage of its operations.
Commodity price risk
The Group’s exposure to commodity price risk is minimal at this stage of its operations.
Liquidity risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall
due. The Group’s approach to managing liquidity is to ensure, as far as possible, that it will always
have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions,
without incurring unacceptable losses or risking damage to the Group’s reputation.
The Group’s objective is to maintain a balance between continuity of funding and flexibility. The
following are the contractual maturities of financial liabilities:
Consolidated – 2018
Trade and other payables
Trade and other receivables
Consolidated – 2017
Trade and other payables
Trade and other receivables
Carrying
amount
$
Contractual
cash flows
$
6 months
or less
$
255,325
255,325
668,167
668,167
462,313
462,313
37,619
37,619
-
-
-
-
-
-
-
-
255,325
255,325
668,167
668,167
462,313
462,313
37,619
37,619
Impact Minerals Ltd | Annual Report 2018 81
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
NOTE 24: FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (Continued)
Fair value of financial assets and liabilities
The fair value of cash and cash equivalents and non-interest bearing financial assets and financial
liabilities of the Group is equal to their carrying value.
Capital risk management
The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a
going concern in order to provide returns for shareholders and benefits for other stakeholders and to
maintain an optimal capital structure to reduce the cost of capital. The management of the Group’s
capital is performed by the Board.
The capital structure of the Group consists of net debt (trade payables, provisions and financial
liabilities detailed in Notes 13, 14 and 15 offset by cash and bank balances) and equity of the Group
(comprising contributed issued capital, reserves, offset by accumulated losses detailed in Notes
16, 17 and 18).
The Group is not subject to any externally imposed capital requirements. None of the Group’s entities
are subject to externally imposed capital requirements.
NOTE 25: SHARE-BASED PAYMENTS
Share Option Plan
The Group has a Director and Employee Option Acquisition Plan (“Option Plan”) for Directors,
employees and contractors of the Group. In accordance with the provisions of the Option Plan, as
approved by shareholders at the 2015 Annual General Meeting, executives and employees may be
granted options at the discretion of the Directors. Options issued to Directors are subject to approval
by shareholders.
Each share option converts into one ordinary share of Impact Minerals Limited on exercise. No
amounts are paid or are payable by the recipient on receipt of the option. The options carry neither
rights of dividends nor voting rights. Options may be exercised at any time from the date of vesting
to the date of their expiry.
82 Impact Minerals Ltd | Annual Report 2018
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
NOTE 25: SHARE-BASED PAYMENTS (Continued)
The following share-based payment arrangements were in existence during the reporting period:
Option series
Number
Grant date
Expiry date
Vesting date
Exercise price
Fair value at
grant date
25(1)
45,000,000
7 Aug 2015
7 Aug 2018
Immediate
26
27
28
26,000,000
29 Sep 2015
29 Sep 2018
29 Sep 2016
12,500,000
29 Sep 2015
29 Sep 2019
29 Sep 2017
12,500,000
29 Sep 2015
29 Sep 2020
29 Sep 2018
29(2)
26,428,572
21 Oct 2015
21 Oct 2018
Immediate
1,000,000
13 May 2016
29 Sep 2018
29 Sep 2016
$0.0325
$0.0367
$0.045
$0.07
$0.0325
$0.0367
3,000,000
13 May 2016
29 Sep 2019
29 Sep 2017
$0.045
3,000,000
13 May 2016
29 Sep 2020
29 Sep 2018
89,479,590
21 Jun 2017
15 Jun 2020
Immediate
243,952,410
11 Sep 2017
15 Jun 2020
Immediate
124,960,556
7 Nov 2017
15 Jun 2020
Immediate
37,500,000
21 Dec 2017
15 Jun 2020
Immediate
4,000,000
21 Dec 2017
15 Jun 2020
Immediate
$0.07
$0.04
$0.04
$0.04
$0.04
$0.04
30
31
32
33(3)
34(4)
35(5)
36(6)
37(7)
$0.0185
$0.0139
$0.0149
$0.0143
N/A
$0.012
$0.0133
$0.0132
N/A
N/A
N/A
N/A
N/A
(1) Options issued to Squadron Resources Pty Ltd (Squadron) as part of the Convertible Note issue and ratified by shareholders
at the 2015 Annual General Meeting.
(2) Options issued to Squadron and approved by shareholders at the 2015 Annual General Meeting.
(3) Three free attaching listed options were issued for each two new shares subscribed for under the Share Purchase Plan (SPP)
concluded in June 2017.
(4) Three free attaching listed options were issued for each two new shares subscribed for under the Shortfall Offer to the SPP
concluded in September 2017.
(5) One free attaching listed option was issued for each new share subscribed for under a Placement concluded in November 2017.
(6) One free attaching listed option was issued for each new share subscribed for under a Placement concluded in December 2017.
(7) Listed options issued to the Lead Manager of the November Placement as part consideration.
Fair value of share options granted during the year
The fair value of share options at grant date is determined using a Black-Scholes option pricing model
that takes into account the exercise price, the term of the option, the share price at grant date, the
expected price volatility of the underlying share and the risk-free rate for the term of the option. The
fair value of share options issued during the year was $109,338 (2017: $295,768).
Impact Minerals Ltd | Annual Report 2018 83
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
NOTE 25: SHARE-BASED PAYMENTS (Continued)
Movements in share options during the year
Movement in the number of share options on issue during the year:
2018
2017
Number of
options
Weighted
average
exercise price
$
Number of
options
Weighted
average
exercise
price
$
Outstanding at the beginning of the year
218,926,162
Issued pursuant to the share purchase plan
(listed)
-
Issued pursuant to shortfall offer (listed)
Issued pursuant to placements (listed)
Issued to lead manager (listed)
243,952,410
162,460,556
4,000,000
Granted during the year
Expired during the year
Cancelled during the year
-
-
-
Outstanding at the end of the year
Exercisable at the end of the year
629,339,128
613,839,128
0.04
-
0.04
0.04
0.04
-
-
-
0.04
0.04
141,828,572
89,497,590
0.04
0.04
-
-
-
-
(12,400,000)
-
218,926,162
187,926,162
-
-
-
-
0.10
-
0.04
0.04
The weighted average remaining contractual life of share options outstanding at the end of the year was 1.68
years (2017: 2.14 years).
Share options outstanding at the end of the year
Share options issued and outstanding at the end of the year have the following exercise prices:
Expiry date
7 August 2018
29 September 2018
21 October 2018
29 September 2019
15 June 2020 (listed)
29 September 2020
Totals
Exercise price
$
0.0325
0.0367
0.0325
0.045
0.04
0.07
2018
Number
45,000,000
27,000,000
26,428,572
15,500,000
499,910,556
15,500,000
629,339,128
2017
Number
45,000,000
27,000,000
26,428,572
15,500,000
89,497,590
15,500,000
218,926,162
84 Impact Minerals Ltd | Annual Report 2018
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
NOTE 26: RECONCILIATION OF CASH FLOWS FROM OPERATING ACTIVITIES
Cash flows from operating activities
Profit/(Loss) for the period
Non-cash flows in profit/(loss):
- Depreciation
- Share-based remuneration
- Finance costs
- Exploration expenditure write-off
- Research and development tax rebate
Changes in assets and liabilities
- Decrease/(Increase) in trade and other receivables
- Decrease/(Increase) in other non-current assets
- Increase/(Decrease) in trade creditors and accruals
- Increase/(Decrease) in provisions
Net cash from/(used in) operating activities
CONSOLIDATED
2018
$
2017
$
(812,796)
(721,564)
3,996
109,338
222,430
228,353
(644,894)
14,347
(1,455)
22,523
(18,368)
(876,526)
1,967
295,768
201,457
101,406
-
32,660
447
(15,500)
150,901
47,542
Non-cash investing and financing activities
There were no non-cash investing and financing activities during the year.
NOTE 27: RELATED PARTY DISCLOSURE
a)
Parent entity
Class
Country of
incorporation
Impact Minerals Limited
Ordinary
Australia
Ownership
2018
%
-
2017
%
-
Impact Minerals Ltd | Annual Report 2018 85
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
NOTE 27: RELATED PARTY DISCLOSURE (Continued)
b)
Subsidiaries
Aurigen Pty Ltd
Siouville Pty Ltd
Drummond East Pty Ltd
Class
Ordinary
Ordinary
Ordinary
Country of
incorporation
Australia
Australia
Australia
Seam Holdings Pty Ltd(i)
Ordinary
British Virgin Islands
Icilion Investments (Pty) Ltd(ii)
Xade Minerals (Pty) Ltd(iii)
Invictus Gold Limited
Drummond West Pty Ltd(iv)
Endeavour Minerals Pty Ltd(v)
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Blackridge Exploration Pty Ltd(vi)
Ordinary
Botswana
Botswana
Australia
Australia
Australia
Australia
Ownership
2018
%
2017
%
100
100
100
100
100
n/a
100
100
100
100
100
100
100
100
100
100
100
100
100
n/a
(i)
(ii)
(iii)
(iv)
(v)
(vi)
Seam Holdings Pty Ltd is a wholly owned subsidiary of Drummond East Pty Ltd.
Icilion Investments (Pty) Ltd is a wholly owned subsidiary of Seam Holdings Pty Ltd.
Xade Minerals (Pty) Ltd was deregistered on 30 January 2018.
Drummond West Pty Ltd is a wholly owned subsidiary of Invictus Gold Limited.
Endeavour Minerals Pty Ltd is a wholly owned subsidiary of Invictus Gold Limited.
Brentwood Exploration Pty Ltd was incorporated on 6 April 2018 and is a wholly owned subsidiary of Drummond
West Pty Ltd.
c)
Loans to and investments in controlled entities
Loans are provided by the Parent Entity to its controlled entities for their respective operating
activities. Amounts receivable from controlled entities are non-interest bearing with no fixed
term of repayment. The carrying value of investments in controlled entities is recognised as
an asset in the Parent Entity. The future successful commercial application of these projects
or the sale to third parties supports the recognition and recoverability of these assets held
in the Parent Entity.
Aurigen Pty Ltd
Siouville Pty Ltd
Drummond East Pty Ltd
Seam Holdings Pty Ltd
Icilion Investments (Pty) Ltd
Drummond West Pty Ltd(i)
(i)
Loan from Invictus Gold Limited.
86 Impact Minerals Ltd | Annual Report 2018
2018
$
607,130
136,372
204,416
9,902
2017
$
607,130
136,372
33,653
9,902
5,669,068
5,659,682
3,527,418
3,527,418
10,154,306
9,974,157
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018
(CONTINUED)
NOTE 27: RELATED PARTY DISCLOSURE (Continued)
d)
Key management personnel compensation
Short-term employee benefits
Post-employment benefits
Share-based payments
2018
$
519,875
8,550
59,554
587,979
2017
$
510,867
8,550
172,027
691,444
Detailed remuneration disclosures are provided in the Remuneration Report on pages 38 to 44.
NOTE 28: PARENT ENTITY DISCLOSURE
Financial Performance
Profit/(loss) for the year
Other comprehensive income
Total comprehensive profit/(loss)
Financial Position
ASSETS
Current assets
Non-current assets
TOTAL ASSETS
LIABILITIES
Current liabilities
TOTAL LIABILITIES
NET ASSETS
EQUITY
Issued capital
Option reserve
Transactions with non-controlling interest
Accumulated losses
TOTAL EQUITY
2018
$
2017
$
(961,789)
(439,889)
-
-
(961,789)
(439,889)
4,179,991
2,137,384
14,169,831
11,308,419
18,349,822
13,445,803
463,325
463,325
2,685,269
2,685,269
17,886,497
10,760,534
44,900,024
36,933,610
1,418,620
1,297,282
(1,161,069)
(1,161,069)
(27,271,078)
(26,309,289)
17,886,497
10,760,534
No guarantees have been entered into by Impact Minerals Limited in relation to the debts of its
subsidiaries.
Impact Minerals Limited had no expenditure commitments as at 30 June 2018 other than the
commitment in relation to the lease of office premises as disclosed in Note 23.
Impact Minerals Ltd | Annual Report 2018 87
DIRECTORS’ DECLARATION
The Directors of Impact Minerals Limited declare that:
1)
in the Directors’ opinion, the financial statements and notes set out on pages 47 to 87 and the
Remuneration Report in the Directors’ Report are in accordance with the Corporations Act
2001, including:
a)
b)
giving a true and fair view of the consolidated entity’s financial position as at 30 June
2018 and of its performance, for the financial year ended on that date; and
complying with Australian Accounting Standards (including the Australian Accounting
Interpretations), Corporations Regulations 2001 and mandatory professional reporting
requirements.
2)
3)
the financial statements also comply with International Financial Reporting Standards as
disclosed in Note 2; and
there are reasonable grounds to believe that the consolidated entity will be able to pay its debts
as and when they become due and payable.
The Directors have been given the declarations required by Section 295A of the Corporations Act
2001 by the Managing Director and Chief Financial Officer for the financial year ended 30 June 2018.
Signed in accordance with a resolution of the Directors.
Peter Unsworth
Chairman
Perth, Western Australia
21 September 2018
88 Impact Minerals Ltd | Annual Report 2018
Independent Auditor's Report
To the Members of Impact Minerals Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Impact Minerals Limited (“the Company”) and its
subsidiaries (“the Group”), which comprises the consolidated statement of financial
position as at 30 June 2018, the consolidated statement of profit or loss and other
comprehensive income, the consolidated statement of changes in equity and the
consolidated statement of cash flows for the year then ended, and notes to the financial
statements, including a summary of significant accounting policies, and the directors’
declaration.
In our opinion:
a.
the accompanying financial report of the Group is in accordance with the
Corporations Act 2001, including:
(i)
(ii)
giving a true and fair view of the Group’s financial position as at 30 June
2018 and of its financial performance for the year then ended; and
complying with Australian Accounting Standards and the Corporations
Regulations 2001.
b.
the financial report also complies with International Financial Reporting Standards
as disclosed in Note 2.
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Those
standards require that we comply with relevant ethical requirements relating to audit
engagements and plan and perform the audit to obtain reasonable assurance about
whether the financial report is free from material misstatement. Our responsibilities under
those standards are further described in the Auditor’s Responsibilities for the Audit of the
Financial Report section of our report. We are independent of the Group in accordance
with the auditor independence requirements of the Corporations Act 2001 and the ethical
requirements of the Accounting Professional and Ethical Standards Board’s APES 110
Code of Ethics for Professional Accountants (the Code) that are relevant to our audit of
the financial report in Australia. We have also fulfilled our other ethical responsibilities in
accordance with the Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our opinion.
Independent Auditor’s Report
To the Members of Impact Minerals Limited (Continued)
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit
of the financial report of the current period. These matters were addressed in the context of our audit of the
financial report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on
these matters.
Key audit matter
How our audit addressed the key audit matter
Exploration and Evaluation Expenditure –
$15,441,823
(Refer to Note 2(m) and Note 11)
Exploration and evaluation expenditure is a key
audit matter due to:
The significance of the balance to the Group’s
consolidated financial position.
The level of judgement required in evaluating
management’s application of the requirements of
AASB 6 Exploration for and Evaluation of
Mineral Resources. AASB 6 is an industry
specific accounting standard requiring the
application of significant judgements, estimates
and industry knowledge. This includes specific
requirements for expenditure to be capitalised as
an asset and subsequent requirements which
must be complied with for capitalised
expenditure to continue to be carried as an
asset.
The assessment of impairment of exploration
and evaluation expenditure being inherently
difficult.
Our procedures included, amongst others:
Assessing management’s determination of its
areas of interest for consistency with the
definition in AASB 6. This involved analysing the
tenements in which the Group holds an interest
and the exploration programmes planned for
those tenements;
For each area of interest, we assessed the
Group’s rights to tenure by corroborating to
government registries and evaluating
agreements in place with other parties as
applicable;
We tested the additions to capitalised
expenditure for the year by evaluating a sample
of recorded expenditure for consistency to
underlying records, the capitalisation
requirements of the Group’s accounting policy
and the requirements of AASB 6;
We considered the activities in each area of
interest to date and assessed the planned future
activities for each area of interest by evaluating
budgets for each area of interest;
We assessed each area of interest for one or
more of the following circumstances that may
indicate impairment of the capitalised
expenditure:
the licenses for the right to explore expiring in
the near future or are not expected to be
renewed;
substantive expenditure for further
exploration in the specific area is neither
budgeted or planned;
decision or intent by the Group to discontinue
activities in the specific area of interest due to
lack of commercially viable quantities of
resources.
Independent Auditor’s Report
To the Members of Impact Minerals Limited (Continued)
Key audit matter
How our audit addressed the key audit matter
data indicating that, although a development
in the specific area is likely to proceed, the
carrying amount of the exploration asset is
unlikely to be recovered in full from
successful development or sale.
Other Information
The directors are responsible for the other information. The other information comprises the information
included in the Group’s annual report for the year ended 30 June 2018, but does not include the financial
report and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not express any
form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information and, in
doing so, consider whether the other information is materially inconsistent with the financial report or our
knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of the Directors for the Financial Report
The directors of the Company are responsible for the preparation of the financial report that gives a true and
fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such
internal control as the directors determine is necessary to enable the preparation of the financial report that
gives a true and fair view and is free from material misstatement, whether due to fraud or error. In Note 2, the
directors also state in accordance with Australian Accounting Standard AASB 101 Presentation of Financial
Statements, that the financial report complies with International Financial Reporting Standards.
In preparing the financial report, the directors are responsible for assessing the Group’s ability to continue as a
going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of
accounting unless the directors either intend to liquidate the Group or to cease operations, or has no realistic
alternative but to do so.
Auditor’s Responsibilities for the Audit of the Financial Report
Our responsibility is to express an opinion on the financial report based on our audit. Our objectives are to
obtain reasonable assurance about whether the financial report as a whole is free from material misstatement,
whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance
is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian
Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from
fraud or error and are considered material if, individually or in the aggregate, they could reasonably be
expected to influence the economic decisions of users taken on the basis of this financial report.
Independent Auditor’s Report
To the Members of Impact Minerals Limited (Continued)
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional judgement
and maintain professional scepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the financial report, whether due to fraud or
error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is
sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material
misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve
collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Group’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the directors.
Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and,
based on the audit evidence obtained, whether a material uncertainty exists related to events or
conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we
conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to
the related disclosures in the financial report or, if such disclosures are inadequate, to modify our
opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s
report. However, future events or conditions may cause the Group to cease to continue as a going
concern.
Evaluate the overall presentation, structure and content of the financial report, including the disclosures,
and whether the financial report represents the underlying transactions and events in a manner that
achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or
business activities within the Group to express an opinion on the financial report. We are responsible for
the direction, supervision and performance of the Group audit. We remain solely responsible for our
audit opinion.
We communicate with the directors regarding, among other matters, the planned scope and timing of the audit
and significant audit findings, including any significant deficiencies in internal control that we identify during our
audit.
We also provide the directors with a statement that we have complied with relevant ethical requirements
regarding independence, and to communicate with them all relationships and other matters that may
reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with the directors, we determine those matters that were of most significance
in the audit of the financial report of the current period and are therefore the key audit matters. We describe
these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or
when, in extremely rare circumstances, we determine that a matter should not be communicated in our report
because the adverse consequences of doing so would reasonably be expected to outweigh the public interest
benefits of such communication.
Independent Auditor’s Report
To the Members of Impact Minerals Limited (Continued)
Report on the Remuneration Report
We have audited the Remuneration Report included in the directors’ report for the year ended 30 June 2018.
The directors of the Company are responsible for the preparation and presentation of the remuneration report
in accordance with s 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the
remuneration report, based on our audit conducted in accordance with Australian Auditing Standards.
Auditor’s Opinion
In our opinion, the Remuneration Report of Impact Minerals Limited, for the year ended 30 June 2018,
complies with section 300A of the Corporations Act 2001.
BENTLEYS
Chartered Accountants
DOUG BELL CA
Partner
Dated at Perth this 21st day of September 2018
ADDITIONAL SHAREHOLDER INFORMATION
AS AT 11 SEPTEMBER 2018
Additional information required by the Australian Securities Exchange Limited and not shown
elsewhere in this report is as follows.
1. Distribution of Holders of Equity Securities
Analysis of number of equity security holders by size of holding:
Shares Held
-
-
-
1,000
1
5,000
1,001
5,001
10,000
10,001 - 100,000
100,001 and over
Total
Shareholders
138
109
114
1,000
843
2,204
The number of holders of less than a marketable parcel of ordinary fully paid shares is 892.
2. Substantial Shareholders
Substantial shareholders (i.e. shareholders who hold 5% or more of the issued capital):
MRS SUSANNE BUNNENEBERG
ABC BETEILIGUNGEN AG
Number of shares
200,199,999
190,314,650
Percentage held
15.15
14.40
3.
Voting Rights
(a) Ordinary Shares
Each shareholder is entitled to receive notice of and attend and vote at general meetings
of the Company. At a general meeting, every shareholder present in person or by proxy,
representative of attorney will have one vote on a show of hands and on a poll, one vote
for each share held.
(b) Options
No voting rights.
4. Quoted Securities on Issue
The Company has 1,321,679,789 quoted shares on issue. The Company has 499,910,556
quoted options on issue exercisable at $0.04 on or before 15 June 2020.
5. On-Market Buy Back
There is no current on-market buy back.
94 Impact Minerals Ltd | Annual Report 2018
ADDITIONAL SHAREHOLDER INFORMATION
AS AT 11 SEPTEMBER 2018 (CONTINUED)
6.
Unquoted Equity Securities
Options exercisable at $0.0367 on or before 29 September 2018
27,000,000
Options exercisable at $0.0325 on or before 21 October 2018
26,428,572
Options exercisable at $0.045 on or before 29 September 2019
15,500,000
Options exercisable at $0.07 on or before 29 September 2020
15,500,000
9
1
10
10
Number on
issue
Number of
holders
7. Twenty Largest Holders of Quoted Ordinary Shares
Shareholder
J P MORGAN NOMINEES AUSTRALIA LIMITED
SQUADRON RESOURCES PTY LTD
ABC BETEILIGUNGEN AG
DEUTSCHE BALATON AKTIENGESELLSCHAFT
V7 INVESTMENT & DEVELOPMENT
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