ANNUAL
REPORT 2019
ASX:OVL
Oro Verde Limited Annual Report 2019
CORPORATE DIRECTORY
This annual report covers the consolidated entity of Oro Verde Limited and its subsidiaries.
The consolidated entity’s functional and presentation currency is AUD ($).
A description of the consolidated entity’s operations and of its principal activities is included
in the review of operations and activities in the directors’ report.
Directors
B D Dickson
Finance Director
A P Rovira
Non-Executive Director
M J Steffens
Non-Executive Director
Company Secretary
B D Dickson
Registered Office
and Principal Place of Business
Level 1, 34 Colin Street
West Perth WA 6005
Telephone: 08 9481 2555
Fax: 08 9485 1290
Share Registry
Security Transfer Australia Pty Ltd
770 Canning Highway
Applecross WA 6153
Auditors
BDO Audit (WA) Pty Ltd
38 Station Street
Subiaco WA 6008
Bank
National Australia Bank
Level 1, Gateway Building
177-179 Davy Street
Booragoon WA 6154
Solicitors
K & L Gates
Level 32, 44 St. George’s Terrace
Perth, WA 6000
Stock Exchange
Australian Securities Exchange
Code: OVL
www.oroverde.com.au
CONTENTS
Directors’ Report .........................................................................................................................2
Directors’ Declaration ............................................................................................................. 16
Auditor’s Independence Declaration ..................................................................................... 17
Consolidated Statement of Profit or Loss and Other Comprehensive Income ............... 18
Consolidated Statement of Financial Position ..................................................................... 19
Consolidated Statement of Cash Flows ................................................................................ 20
Consolidated Statement of Changes In Equity..................................................................... 21
Notes to the Consolidated Financial Statements ................................................................ 22
Independent Audit Report ...................................................................................................... 51
Corporate Governance Statement ........................................................................................ 54
ASX Additional Information .................................................................................................... 59
The information in this report that relates to previously reported Exploration Results
has been referred to throughout the report to the date that it was originally reported
to ASX. The Company confirms that it is not aware of any new information or data that
materially affects the information included in the original market announcements and
that all material assumptions and technical parameters underpinning the estimates in the
relevant market announcements continue to apply and have not materially changed. The
Company confirms that the form and context in which the Competent Person’s findings are
presented have not been materially modified from the original market announcements.
Directors’ Report
Directors
The names and details of the directors of Oro Verde Limited in office during the financial year and until the date of this report are as
follows. Directors were in office for the whole of the financial year, unless otherwise stated.
M J Steffens BEng(Hons), PhD, MAusIMM - (Non-Executive Director) - Appointed 30 November 2018
Dr Steffens is a minerals engineer with a PhD in metallurgy from the WA School of Mines. His experience covers a broad range of
commodities and includes areas of project evaluation, project management and process development, as well as experience in African
minerals projects. He is a Member of the Australian Institute of Mining and Metallurgy.
Mr Steffens is not a director of any other public company.
B D Dickson B.Bus, FCPA, FGIA, MAICD – (Finance Director & Company Secretary) – Appointed 21 November 2014
Mr Brett Dickson has over 20 years experience in the financial management of companies, principally companies in early stage
development of its resource or production, and offers broad financial management skills. He has been Company Secretary and Chief
Financial Officer (CFO) for a number of successful resource companies listed on the ASX. Mr Dickson is also a director of Rox Resources
Limited.
A P Rovira BSc (Hons), MAusIMM - (Non-Executive Director) - Appointed 21 November 2014
Mr Tony Rovira has over 30 years technical and management experience in the mining industry, as an exploration and mining geologist,
and as a company executive at Board level. Since graduating from Flinders University in South Australia in 1983, Tony has worked for
companies both large and small, including BHP, Barrack Mines, Pegasus Gold and Jubilee Mines.
From 1997-2003 Tony was the General Manager of Exploration with Jubilee Mines, during which time he led the team that discovered
and developed the world class Cosmos and Cosmos Deeps nickel sulphide deposits in Western Australia. In the year 2000, the
Association of Mining and Exploration Companies awarded Mr Rovira the “Prospector of the Year Award” for these discoveries.
Mr Rovira is also a director of Azure Minerals Limited.
W G Martinick B.Sc, Ph.D. FAusIMM. (Chairman) – Appointed 13 January 2003, retired 30 November 2018
Dr Wolf Martinick is an environmental scientist with over 40 years’ experience in mineral exploration and mining projects around
the world, attending to environmental, water, land access and indigenous people issues. He has conducted due diligence on mining
projects around the world on behalf of international financial institutions and resource companies for a variety of transactions
including listings on international stock exchanges, mergers and debt financing. He is a Fellow of the Australian Institute of Mining
and Metallurgy.
Dr Martinick is a founding director and former chairman of Weatherly International plc, an AIM listed company with copper mines
in Namibia. Previously Dr Martinick was a founding director of Basin Minerals Limited, an ASX listed mineral exploration company
that discovered a world-class mineral project in Victoria, Australia, that was acquired by Iluka Resources Limited in 2003. He was also
Chairman of ASX listed Sun Resources Limited until early 2016 and is a director of Azure Minerals Limited.
B L Farrell B.Sc (Hons Econ Geol), M.Sc, Ph.D, FAusIMM, MICA, CPGeol, MIMM, CEng.
(Non-Executive Director) – Appointed 8 August 2011, resigned 16 November 2018
Dr Farrell has over 40 years’ experience in resource exploration and senior project management and evaluation. During this time he
has managed numerous and extensive exploration programs within Australia and overseas for a variety of mineral commodities for
both major and junior exploration companies. Some of these programs have resulted in significant discoveries, which are currently in
production or will see future production. He is a Fellow of the Australian Institute of Mining and Metallurgy, a Chartered Professional
Geologist of that body, Member of Mineral Industry Consultants Association, a Member of the Institution of Mining and Metallurgy
and a Chartered Engineer of that body.
2
Oro Verde Limited Annual Report 2019 Interests In The Shares And Options Of The Company
As at the date of this report the interests of the directors in the securities of the company were:
B D Dickson
A P Rovira
M J Steffens (appointed 30 Nov. 2018)
W G Martinick (retired 30 Nov. 2018)1
B L Farrell (resigned 16 Nov. 2018)1
1. Holding at time of retirement/resignation
Number of
Ordinary Shares
Number of Options
over Ordinary Shares
23,420,330
51,602,016
-
77,738,782
75,315,872
36,000,000
42,000,000
-
20,000,000
20,000,000
Interests In Contracts Or Proposed Contracts With The Company
During or since the end of the financial year, no director has had any interest in a contract or proposed contract with the company
being an interest the nature of which has been declared by the director in accordance with Section 300(11)(d) of the Corporations
Act 2001.
Directors’ Meetings
During the year 3 directors’ meetings were held. The number of meetings attended by each director was as follows:
B D Dickson
A P Rovira
M J Steffens (appointed 30 Nov. 2018)
W G Martinick (retired 30 Nov. 2018)
B L Farrell (resigned 16 Nov 2018)
No. of meetings held
while in office
Meetings attended
3
3
2
1
1
3
3
2
1
1
As at the date of this report, the company did not have audit, remuneration or nomination committees, as the directors believe the
size of the company does not warrant their existence.
Dividends Paid Or Proposed
The company has not paid any dividends since the commencement of the financial year, and no dividends are proposed to be paid.
Corporate Information
The Financial Statements of Oro Verde Limited for the year ended 30 June 2019 were authorised for issue in accordance with a
resolution of the directors on 23 September 2019. The group’s functional and presentation currency is AUD ($).
Oro Verde Limited is a company limited by shares incorporated in Australia whose shares are publicly traded on the Australian
Securities Exchange.
Principal Activities
The principal activity during the year of the group was investment in the mining and resource sector.
The group’s business is conducted from operations located in Australia and in Nicaragua through its 100% owned subsidiary Minera
San Cristobal, SA.
Employees
Other than the Directors the group employed one person, based in Nicaragua at 30 June 2019 (2018: 4).
3
Directors’ Report
Operating And Financial Review
Overview
Makuutu, Rare Earth Elements (Earning up to 60%)
During the period, and after an extensive and very selective search, the company reached agreement to acquire up to a 60% interest
in the Makuutu Rare Earths project (Makuutu) from the Ugandan company Rwenzori Metals Limited.
The Makuutu project comprises three licences covering approximately 132 km2 located some 40 km east of the regional centre of
Jinja and 120 km east of the capital city of Kampala in eastern Uganda. The area has excellent infrastructure with tarred roads, nearby
rail, power and water, cell-phone coverage, as well as being readily accessible throughout the year irrespective of weather conditions.
The Makuutu project geology is similar to the southern China ionic clay-type deposits, which are the cheapest and most readily
accessible source of heavy Rare Earth Oxides (HREO) that are extracted through rudimentary mining and processing methods.
Ionic clay Rare Earth Projects vary markedly from hard rock Rare Earth projects. Typically, rare earths can be recovered from ionic
clay mineralisation using mild leaching conditions and generally present practical processing advantages which are summarized in
the following table:
Mining/processing stages
Clay-hosted ree
Hard rock-hosted ree
Mineralisation
Mining
Soft material, negligible (if any) blasting
Hard rock
Low operating costs:
Surface mining (0-15m)
High operating costs:
Blasting required
Minimal stripping of waste material
Could have high strip ratios
Progressive rehabilitation of mined areas
Processing – Mining site
No crushing or milling
Potential for static or in-situ leaching
Ambient temperature
Simple process plant
Comminution, followed by beneficiation
that often requires expensive (flotation)
reagents
Mine product
Mixed high-grade rare earth precipitate
(~50-95% depending on precipitant) for
feedstock into rare earth separation plant
Mixed REE mineral concentrate (typically
20 – 40% TREO)
Processing – Refinery (typically
not on mining site)
Simple acid solubilisation followed by
conventional REE separation
High temperature mineral “cracking” using
strong reagents
Complex recycling of reagents and water
Complex plant (to withstand strong
reagents and high temperatures)
Processing – Environmental
Non-radioactive tailings
Solution treatment and reagent recovery
requirements (somewhat off-set by
advantageous supporting infrastructure)
High reagent consumption per tonne of
REO)
Tailings often radioactive (complex and
costly disposal)
4
Oro Verde Limited Annual Report 2019 The Makuutu Rare Earth Elements project is owned 100% by Ugandan registered Rwenzori Rare Metals Limited (RRM) which in turn is
owned 85% by South African registered Rare Earth Elements Africa Proprietary Limited (REEA). Oro Verde has entered into a binding
option agreement with both companies that enables it to acquire up to a 60% direct interest in RRM, and thereby up to a 60% indirect
interest in the project by:
1. the payment of US$10,000 for a 30-day exclusive option period. This payment has been made;
2. Upon exercise of the option, the payment of US$100,000 cash and issuing US$150,000 in Oro Verde shares, at a 30-day VWAP in
return for an immediate 20% interest in RRM;
3. OVL to contribute US$1,700,000 of expenditure by 1 October 2020 to earn up to a 51% staged interest in RRM as follows:
Spend
Exercise of Option US$100,000 as in 2 above
Expenditure contribution of US$650,000
Expenditure contribution of further US$800,000
Expenditure contribution of further US$250,000
Interest earned
Cumulative Interest
earned
20%
11%
15%
5%
20%
31%
46%
51%
4. Oro Verde to fund to completion of a bankable feasibility study to earn an additional 9% interest for a cumulative 60% interest in
RRM.
5. During the earn-in phase there are milestone payments, payable in cash or Oro Verde shares at the election of the Vendor, as
follows:
• US$750,000 on the Grant of Retention licence over RL1693 which is due to expire in November 2020;
• US$375,000 on production of 10 kg of mixed rare-earth product from pilot or demonstration plant activities; and
• US$375,000 on conversion of existing licences to mining licences.
6. At any time should Oro Verde not continue to invest in the project and project development ceases for at least two months RRM
has the right to return the capital sunk by Oro Verde and reclaim all interest earnt by Oro Verde.
Shareholder approval was obtained at a General Meeting held on 19 August 2019.
5
Directors’ Report
Nicaragua
The Company operates the San Isidro mineral concessions in Nicaragua and has three exploration licences under application near
the Topacio project (Figure 1).
Figure 1.- Location of Nicaragua and Oro Verde’s Projects
Withdrawal from the Topacio Option Agreement
During the financial year the Company advised that it had informed Topsa S.A., the vendor of the Topacio Gold Project (Topacio) in
Nicaragua, of its immediate withdrawal from the Topacio Option Agreement.
In withdrawing from the agreement, the Board of Oro Verde was cognisant of the long-running civil unrest at the time in Nicaragua
and the US$1.5 million (approx. A$2.08M) acquisition payment that was due in February 2019.
San Isidro, (Oro Verde 100%)
The San Isidro Gold Project constitutes a 25 km2 mining concession in north-western Nicaragua and lies adjacent to the La India Gold
Project, held by UK company Condor Gold Plc., which contains a reported 2.3 million ounce gold resource. In 2018 Condor announced
that it had received an environmental permit for the development, construction and operation of a processing plant with a capacity of
up to 2,800 tonnes per day and associated mine site infrastructure at the La India Gold Project.
Oro Verde’s San Isidro Gold Project has the potential to contain La India-style vein-hosted epithermal gold mineralisation.
Late in 2018 the Company reached agreement to sell 96 Ha of the 2,500 ha concession to a consortium that required flat stable ground
for a tailings retreatment processing plant. The sale price was US$42,000 of which $21,000 has been received with the balance due
upon Mines Department Approval
Other opportunities to further monetise the value of San Isidro are being investigated.
6
Oro Verde Limited Annual Report 2019 New Concessions – Iguanas, Galeano and Tigre
Three mineral concession applications, Iguanas, Galeano and Tigre were submitted some time ago by Minera San Cristóbal, S.A. (MSC,
a 100% owned Nicaraguan subsidiary of Oro Verde) for ground covering the land adjacent to the Topacio gold project (Figure 2).
The Nicaraguan Ministry of Mines and Energy (MEM) has accepted these applications with certification for the approval of the three
concession applications by the MDLB Municipality completed and returned to MEM.
Final signoff from MEM for the award of these concessions is awaited.
Figure 2 - Topacio Project (red) & Iguanas, Galeano and Tigre applications (blue)
Nicaraguan Civil Unrest
On 16 April 2018, official public notification was given regarding the Nicaraguan Government’s proposal to raise social security (INSS)
withholdings from both employees and employers, while at the same time reducing pension amounts to retired workers, beginning
in July 2018.
This created considerable civil unrest in Nicaragua, with numerous protests and riots, beginning on 19 April 2018. While the proposed
changes to the social security regime were withdrawn by the Government, demonstrations continued which include demands for the
removal of President Daniel Ortega and his wife, Vice President Rosario Murillo.
Security factors since that time have improved but remain an issue throughout Nicaragua. The Company continues to monitor the
situation.
Operating Results
The Group’s income was $75,326 and the loss was $978,314 for the financial year. Exploration expenses ($186,831) and salaries, wages
and consulting fee-based payments ($380,702) account for approximately 64% of this year’s loss.
Operating income
Operating loss
2019
$
75,326
(978,314)
2018
$
16,118
(2,004,581)
7
Directors’ Report
Year in Review
Review of Financial Position
During the year, the Group raised $1,332,601 (after all expenses) through the issue of 570,000,000 fully paid shares.
As a result of that raising and the raising of $600,000 (before expenses) subsequent to the end of the financial period the directors
believe that at the date of this report the Group has a sound capital structure and is in a position to progress its mineral properties.
At 30 June 2019 the cash balance of the group stood at $691,153.
Likely Developments And Expected Results Of Operations
Oro Verde continues to review gold-silver-copper opportunities in search of quality projects to enhance the existing portfolio. To date,
suitable transactions have not been achieved on preferred projects. Discussions and reviews are ongoing as the Company aims to
add shareholder value through its Corporate Advisor and the quality team and connections that it has assembled within Nicaragua
and the region.
Indemnification And Insurance Of Directors And Officers
During or since the financial year, the company has paid premiums in respect of a contract insuring all the directors of Oro Verde
Limited against legal costs incurred in defending proceedings for conduct involving:
(a) a wilful breach of duty; or
(b) a contravention of sections 182 or 183 of the Corporations Act 2001, as permitted by section 199B of the Corporations Act 2001.
The total amount of insurance contract premiums paid was $17,052 (2018: $10,950).
Environmental Regulation And Performance
The company is subject to significant environmental regulation in respect of its exploration activities. It aims to ensure the appropriate
standard of environmental care is achieved and in doing so, that it is aware of and is following all relevant environmental legislation.
The directors of the company are not aware of any breach of environmental legislation for the year under review. The directors
have considered compliance with the National Greenhouse and Energy Reporting Act 2007 which requires entities to report annual
greenhouse gas emissions and energy use. The directors have assessed that the Company has no current reporting requirements but
may be required to report in the future.
Proceedings On Behalf Of Company
No person has applied for leave of court to bring proceedings on behalf of the Company or intervene in any proceedings to which the
Company is a party for the purpose of taking responsibility on behalf of the Company for all or any part of those proceedings. The
Company was not a party to or intervened in any proceedings during the year.
8
Oro Verde Limited Annual Report 2019 Remuneration Report (Audited)
This remuneration report outlines the director and executive remuneration arrangements of the Company and the Group in
accordance with the requirements of the Corporations Act 2001 and its Regulations. For the purposes of this report, key management
personnel (KMP) of the Group are defined as those persons having authority and responsibility for planning, directing and controlling
the major activities of the Company and the Group, directly or indirectly, including any director (whether executive or otherwise) of
the parent company.
For the purposes of this report, the term ‘executive’ encompasses the chief executive and secretaries of the Parent and the Group.
Details of key management personnel
B D Dickson
Finance Director
A P Rovira
Director (Non-Executive)
M J Steffens Director (Executive) - (appointed 30 November 2018)
W G Martinick Chairman (Non-Executive) - (Retired 30 November 2018)
B L Farrell
Director (Non-Executive) - (Resigned 16 November 2018)
D V Bright
Chief Executive Officer - (Contract finished 16 December 2018)
Remuneration philosophy
The Board of Directors is responsible for determining and reviewing compensation arrangements for the directors. The Board
assesses the appropriateness of the nature and amount of emoluments of such officers on a periodic basis by reference to relevant
employment market conditions with the overall objective of ensuring maximum stakeholder benefit from the retention of a high-
quality board and executive team. Such officers are given the opportunity to receive their base emolument in a variety of forms
including cash and other non-cash payments. It is intended that the manner of payment chosen will be optimal for the recipient
without creating undue cost for the company.
To assist in achieving these objectives, the Board links the nature and amount of executive directors’ and officers’ emoluments on an
annual basis based on individual performance and market conditions.
In the event of serious misconduct or a material misstatement in the Group’s financial statements, the Board can reduce, cancel or
defer performance-based remuneration and may also claw back performance-based remuneration paid in previous financial years.
Remuneration structure
In accordance with best practice corporate governance, the structure of non-executive director and executive remuneration is
separate and distinct.
Compensation of Directors and Executive Officer
(i) Compensation Policy
The Board of Directors of Oro Verde Limited is responsible for determining and reviewing compensation arrangements for the
directors and the managing director.
(ii) Non-Executive Director Compensation
Objective
The Board seeks to set aggregate compensation at a level that provides the company with the ability to attract and retain directors of
the highest calibre, whilst incurring a cost that is acceptable to shareholders.
Structure
The Constitution and the ASX Listing Rules specify that the aggregate compensation of non-executive directors shall be determined
from time to time by a general meeting. An amount not exceeding the amount determined is then divided between the directors as
agreed and reviewed annually. The latest determination was in 2011 when shareholders approved an aggregate remuneration of
$400,000 per year. The Board may consider advice from external consultants as well as the fees paid to non-executive directors of
comparable companies when undertaking the annual review process. Non consultants were used during the year.
Non-executives directors have long been encouraged by the Board to hold shares in the company (purchased by the director on
market). It is considered good governance for directors to have a stake in the company on which board they sit.
9
Directors’ Report
(iii) Executive Compensation
Objective
The entity aims to reward executives with a level and mix of compensation commensurate with their position and responsibilities
within the entity so as to:
•
•
align the interests of executives with those of shareholders; and
ensure total compensation is competitive by market standards.
Structure
The Board periodically assesses the appropriateness of the nature and amount of emoluments of such officers on a periodic basis
by reference to relevant employment market conditions with overall objective of ensuring maximum stakeholder benefit from the
retention of a high quality board and executive team. Such officers are given the opportunity to receive their base emolument in a
variety of forms including cash and other non-cash benefits. It is intended that the manner of payment chosen will be optimal for the
recipient without creating undue cost for the company.
Compensation of Directors and Executive Officer (Continued)
(iv) Fixed Compensation
Objective
Fixed compensation is reviewed annually by the Board. The process consists of a review of individual performance, relevant
comparative compensation in the market and internally and, where appropriate, external advice on policies and practices.
Structure
Executives are given the opportunity to receive their fixed remuneration in a variety of forms including cash and other non-cash benefits.
(v) Variable Compensation
Objective
The objective is to link the achievement of the company’s targets with the compensation received by the executives charged with
meeting those targets.
Currently, the company does not restrict executives from entering into arrangements to protect the value of unvested Long-Term
Incentives. However, under the Securities Dealing Policy, members of the Board are required to advise the Company Secretary of any
shareholdings including any hedging arrangements.
Share-based compensation
Options or shares may be issued to directors and executives as part of their remuneration. The options or shares are not issued based
on performance criteria but are issued to the directors and executives of Oro Verde Limited to increase goal congruence between
executives, directors and shareholders.
During the year no options (2018: 40,000,000) were issued to key management personnel, details of the options are set out elsewhere
in this report. In addition, 2,971,698 shares were issued (2018: 760,245) in lieu of cash directors’ fee, details of the shares issued are
set out elsewhere in this report.
Structure
Actual payments granted to each KMP are determined by the Board who meet periodically to assess the achievements of the company’s
targets. There are currently no targets established.
10
Oro Verde Limited Annual Report 2019 Employment contracts
Remuneration and other terms of employment for the following KMP are formalised in service agreements, the terms of which are
set out below:
Mr B D Dickson, Finance Director and Company Secretary:
•
•
Term of agreement – from 1 January 2018.
Fixed consulting fee of $7,500 per month.
• Payment of termination benefit on early termination by the employer, other than for gross misconduct, includes an amount
equal to the amounts due for the balance of the term of the contract from the date of termination or the equivalent of 6 months
remuneration.
Compensation of Key Management Personnel (Consolidated and Parent)
Compensation of each director and the executive officer of the parent and group are as follows:
Short term
Post
employment
Share based
payments
Total
Total
options
related
Total
performance
related
30 June 2019
Salaries
and fees
$
Non Monetary
Benefit1
$
Superannuation
$
Options
$
$
$
Directors
W G Martinick2
M J Steffens5
16,739
19,162
B D Dickson
120,000
A P Rovira
B L Farrell4
D V Bright³
Total
30,000
11,332
23,607
220,840
2,079
2,912
4,991
4,991
2,079
-
17,052
1,590
-
2,850
2,850
1,077
-
8,367
-
-
-
-
-
-
-
20,408
22,074
127,841
37,841
14,488
23,607
246,259
-
-
-
-
-
-
-
-
-
-
-
-
Short term
Post
employment
Share based
payments
Total
Total
options
related
Total
performance
related
Salaries and
fees
$
Non Monetary
Benefit1
$
Superannuation
$
Options
$
$
$
20,000
125,000
87,500
15,000
5,000
68,530
321,030
2,281
2,281
2,281
2,281
2,281
-
1,900
48,511
72,692
48,511
-
11,425
1,425
11,425
-
-
127,281
48,511
48,511
48,511
-
149,717
67,217
67,217
68,530
-
48,511
48,511
48,511
-
11,405
26,175
194,044
552,654
194,044
66.7
-
32.4
72.2
72.2
-
35.1
30 June 2018
Directors
W G Martinick
T I Woolfe²
B D Dickson
A P Rovira
B L Farrell
D V Bright³
Total
1. The Non-Monetary Benefit relates to the Directors’ Indemnity Insurance
2. Retired 30 November 2018
3. Contracted finish 16 December 2018
4. Resigned 16 November 2018
5. Appointed 30 November 2018
During the year directors received shares to the value of $12,600 (2018: $8,634) in lieu of cash fees. This amount was accrued as at
30 June 2018.
11
Directors’ Report
Compensation Options: Granted and Vested during the year.
During the year no compensation options were granted (2018: 40,000,000).
There were no alterations to the terms and conditions of options granted as remuneration since their grant date. No Compensation
Options were exercised during the financial period (2018: 5,000,000 exercised at $0.01 each), in addition 25,000,000 Compensation
Options were forfeited (2018: nil).
The Company’s remuneration policy prohibits directors and executives from entering into transactions or arrangements which limit
the economic risk of participating in unvested entitlements.
Apart from the issue of options the company currently has no performance based remuneration component built into director and
executive remuneration (2018: Nil).
Shareholdings of Key Management Personnel
2019
Specified Directors
W G Martinick¹
A P Rovira
B L Farrell¹
B D Dickson
D V Bright¹
Total
Balance
1 July 2018
Purchased
On Exercise
of Options
Received in
lieu of fees
Balance
30 June 19
54,767,084
20,000,000
31,602,016
20,000,000
55,315,872
20,000,000
15,420,330
8,000,000
-
-
157,105,302
68,000,000
-
-
-
-
-
-
2,971,698
77,738,782
-
-
-
-
51,602,016
75,315,872
23,420,330
-
2,971,698
228,077,000
Option Holdings of Key Management Personnel
2019
Balance at
beginning of year
1 July 2018
Purchased
Options
Exercised
Options
Lapsed
Balance at end
of year
30 June 2019
Vested at 30 June 2018
W G Martinick¹
10,000,000
10,000,000
B L Farrell1
M J Steffens
A P Rovira
B D Dickson
D V Bright¹
Total
10,000,000
10,000,000
-
-
32,000,000
10,000,000
32,000,000
4,000,000
-
-
84,000,000
34,000,000
Other Transactions
Vested &
Exercisable
Unvested
-
-
-
-
-
-
-
10,000,000
10,000,000
10,000,000
10,000,000
10,000,000
10,000,000
-
-
-
-
-
-
42,000,000
42,000,000
36,000,000
36,000,000
-
-
20,000,000
98,000,000
98,000,000
-
-
-
-
-
-
-
The Company has entered into a sub-lease agreement on normal commercial terms with Azure Minerals Limited, a company of which
Dr Martinick and Mr Rovira are directors. During the year, the Company paid sub-lease fees totalling $4,800 (2018: $4,800).
On 23 April 2018 the Company drew-down $100,000 on a short-term bridging facility entered into on 20 April 2018 with Inkjar Pty
Ltd an entity associated with Dr Bradford Farrell (“Facility”), a director of the Company. During the period the Company repaid this
$100,000 plus $3,420 of accumulated interest.
Amounts due and unpaid at 30 June 2019 to Key Management Personnel include:
Consulting fees of $9,034 to Braunelle Trust, a related party of M J Steffens.
1. Holdings at the time of retirement or resignation.
12
Oro Verde Limited Annual Report 2019 Company’s Performance
Company’s share price performance
The Company’s share price performance shown in the below graph for the year ended 30 June 2019 and is a reflection of the Company’s
performance during the year.
The variable component of the executives’ remuneration, which at this stage only includes share options, is indirectly linked to the
Company’s share price performance.
Loss per share
Below is information on the Company’s loss per share for the previous four financial years and for the current year ended 30 June 2019.
Basic loss per share (cents)
2019
(0.06)
2018
(0.24)
2017
(0.14)
2016
(0.26)
2015
(0.40)
Voting and comments made at the company’s 2018 Annual General Meeting
Oro Verde received a 97.7% “yes” vote on its remuneration report for the 2018 financial year. The company did not receive any specific
feedback at the AGM or throughout the year on its remuneration practices.
End of Remuneration Report (Audited)
13
Directors’ Report
Corporate Governance
In recognising the need for the highest standards of corporate behaviour and accountability, the directors of the company support
and have adhered to the principles of corporate governance. The company’s corporate governance statement is contained in the
additional Australian Securities Exchange information section of this annual report.
Share Options
At the date of this report, there were 435,000,000 (2018: 120,000,000) share options outstanding.
Balance at the beginning of the year
Share option movements during the year
Issued
Exercised
Lapsed
Total number
of Options
120,000,000
Exercisable at 1.3 cent, on or before 30 Nov ’20
-
Exercisable at 0.75 cents, on or before 31 Jul ’21
340,000,000
Total options issued and exercised in the year to 30 June 2018
340,000,000
-
-
-
(25,000,000)
(25,000,000)
-
340,000,000
(25,000,000)
315,000,000
Total number of options outstanding as at 30 June 2019
and at the date of this report
435,000,000
The balance is comprised the following:
Date Granted
Expiry Date
Exercise Price (cents)
Number of Options
7 October 2014
27 November 2014
31 March 2015
15 December 2017
25 July 2018
Total number of options outstanding at the
date of this report
30 September 2019
30 September 2019
30 September 2019
30 November 2020
31 July 2021
5.0
5.0
5.0
1.3
0.75
66,000,000
5,000,000
2,000,000
22,000,000
340,000,000
435,000,000
No person entitled to exercise any option referred to above has or had, by virtue of the option, a right to participate in any share issue
of any other body corporate.
No options were exercised during the financial year and since the end of the financial year no options have been exercised.
On 13 August 2018 the Company issued 50,000,000 Performance Rights. The vesting conditions for the Performance Rights are as
follows:
• 15 million performance shares which vest if the 10 Day volume weighted average price (“VWAP”) of the Company shares exceed
$0.01 per share;
• 15 million performance shares which vest if the 10 Day volume weighted average price (“VWAP”) of the Company shares exceed
$0.015 per share; and
• 20 million performance shares which vest if the 10 Day volume weighted average price (“VWAP”) of the Company shares exceed
$0.02 per share
The Performance Rights were issued for nil cash consideration and no consideration will be payable upon vesting of the Performance
Rights. Upon satisfaction of the vesting conditions, each Performance Right will automatically vest into one fully paid ordinary share
of the Company. The Performance Rights will lapse on 13 August 2020.
As at 30 June 2019 and the date of this report no performance share has vested.
14
Oro Verde Limited Annual Report 2019 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 amount paid or payable to the auditor for audit and non-audit services provided during the year are set out below.
The Board of Directors has considered the position and is satisfied that the provision of the non-audit services is compatible with the
general standard of independence for auditors imposed by the Corporations Act 2001. The directors are satisfied that the provision of
non-audit services by the auditor, as set out below, did not compromise the auditor independence requirements of the Corporations
Act 2001 for the following reasons:
• All non-audit services have been reviewed by the board to ensure they do not impact the impartiality and objectivity of the
auditor
• None of the services underline the general principals relating to auditor independence as set out in APES 110 Code of Ethics
for Professional Accountants.
During the year the following fees were paid or payable for services provided by the auditor of the parent entity, its related practices
and non-audit firms. There were no non-audit related services provided.
1. Audit Services
BDO Audit (WA) Pty Ltd – audit and review of financial reports
BDO Nicaragua, S.A. – audit and review of Nicaraguan subsidiary
2. Non audit Services
BDO Audit (WA) Pty Ltd – Attendance at AGM
Total remuneration for audit services
Auditor’s Independence Declaration
Consolidated
2019
$
2018
$
40,624
-
40,091
12,150
410
383
41,034
52,624
We have obtained an independence declaration from our auditors, BDO Audit (WA) Pty Ltd, as presented on page 18 of this
Annual Report.
Events After Reporting Date
On 11 July and 17 September 2019, the Company completed placements of 200,000,000 shares at $0.003 and 117,720,000 shares at
$0.006 to raise $600,000 and $706,320, respectively (before expenses of the issue).
On 6 September 2019 the Company issued 100,000,000 at a deemed price of $0.003 for consulting services. Additionally on the same
date 29,179,517 shares were issued as part payment for an initial 20% interest in Rwenzori Rare Metals Limited which holds 100% of
the Makuutu Rare Earths project in Uganda.
No other matter or circumstance has arisen since the end of the financial year which significantly affected or may significantly affect
the operations of the group, the results of those operations, or the state of affairs of the group in future financial years.
Signed in accordance with a resolution of the directors,
A Rovira
Director
Perth, 24 September 2019
15
Directors’ Declaration
In accordance with a resolution of the directors of Oro Verde Limited, I state that:
1. In the opinion of the directors:
(a)
the financial statements, notes and additional disclosures included in the directors’ report designated as audited, of the
consolidated entity are in accordance with the Corporations Act 2001, including:
(i) giving a true and fair view of the consolidated entity’s financial position as at 30 June 2019 and of their performance
for the year ended on that date; and
(ii) complying with Australian Accounting Standards which, as stated in accounting policy Note 2 to the Financial
Statements, constitutes explicit and unreserved compliance with International Financial Reporting Standards (IFRS),
the Corporations Regulations 2001 and other mandatory professional reporting requirements; and
(b) subject to achievement of the matters as set out in Note 2(a), there are reasonable grounds to believe that the company
will be able to pay its debts as and when they become due and payable.
2. This declaration has been made after receiving the declarations required to be made to the directors in accordance with
section 295A of the Corporations Act 2001 for the financial year ending 30 June 2019.
On behalf of the Board
A Rovira
Director
Perth, 24 September 2019
16
Oro Verde Limited Annual Report 2019 Auditors Independence Declaration
17
Consolidated Statement of Profit or Loss and Other Comprehensive Income
for the year ended 30 June 2019
Notes
2019
$
2018
$
Continuing operations
Revenue
Interest Received
Other income
Expenses
Depreciation
Consultants
Directors’ fees (excluding executives)
Executives’ salaries, wages and consulting fees
Interest expenses
Exploration expenses
Exploration expenses reimbursed
Legal fees
Travel and accommodation
Administration expenses
Insurance
Promotion
Share based payments
Impairment of receivables
Loss from continuing operations before income tax
Income tax credit/(expense)
Loss for the year
Other comprehensive income
Items that may be reclassified subsequently to profit or loss:
Exchange differences in translating foreign controlled entities
Total other comprehensive loss net of tax
Total comprehensive loss for the year
3
3
9
4
4
4
4
25
5
4,138
71,188
2,252
13,866
(3,354)
(23,608)
(107,233)
(249,861)
(1,177)
(8,208)
(10,522)
(130,000)
(442,727)
(7,566)
(186,831)
(1,140,021)
-
(1,782)
(31,585)
382,162
(8,420)
(62,127)
(136,527)
(232,456)
(18,216)
(2,782)
(288,096)
(2,588)
(16,208)
(14,360)
(228,000)
(102,246)
(978,314)
(2,004,581)
-
-
(978,314)
(2,004,581)
15,489
15,489
(165,031)
(165,031)
(962,825)
(2,169,612)
Total loss per share for loss attributable to the ordinary equity holders
Basic loss per share (cents)
Diluted loss per share (cents)
19
19
(0.06)
(0.06)
(0.24)
(0.24)
The above Consolidated Statement of Profit or Loss and Other Comprehensive Income should be read in conjunction with the
accompanying notes.
18
Oro Verde Limited Annual Report 2019 Consolidated Statement of Profit or Loss and Other Comprehensive Income
Consolidated Statement of Financial Position
for the year ended 30 June 2019
as at 30 June 2019
Assets
Current assets
Cash and cash equivalents
Receivables
Other
Total current assets
Non-current assets
Plant and equipment
Exploration & evaluation expenditure
Total non-current assets
Total assets
Liabilities
Current liabilities
Payables
Loan
Total current liabilities
Total liabilities
Net assets
Equity
Issued capital
Reserves
Accumulated losses
Total equity
Notes
30 June 2019
$
30 June 2018
$
16
6
7
9
10
12
691,153
28,722
6,677
726,552
-
-
-
322,994
12,639
4,872
340,505
19,036
-
19,036
726,552
359,541
65,378
-
65,378
268,839
100,000
368,839
65,378
368,839
661,174
(9,298)
14
15
24,503,006
23,157,805
5,227,734
4,924,149
(29,069,566)
(28,091,252)
661,174
(9,298)
Total loss per share for loss attributable to the ordinary equity holders
Basic loss per share (cents)
Diluted loss per share (cents)
19
19
(0.06)
(0.06)
(0.24)
(0.24)
The above Consolidated Statement of Financial Position should be read in conjunction with the accompanying notes.
19
Consolidated Statement of Cash Flows
for the year ended 30 June 2019
Cash flows from operating activities
Payments to suppliers and employees
Reimbursement of exploration expenditure
Payments for exploration expenditure
Other revenue
Interest received
Notes
2019
$
2018
$
(751,892)
(883,019)
-
154,712
(186,831)
(1,096,244)
-
4,138
13,866
2,252
Net cash flows used in operating activities
16
(934,585)
(1,808,433)
Cash flows from investing activities
Proceeds from sale of mineral concessions
Proceeds from sale of plant and equipment
Payment for plant and equipment
Net cash flows used in investing activities
Cash flows from financing activities
28,796
30,393
-
59,189
-
-
(894)
(894)
Proceeds from issue of ordinary shares (net of transaction costs)
1,332,601
1,661,253
Proceeds from borrowings
Repayment of borrowings
Interest on borrowings
Net cash flows from financing activities
-
400,000
(100,000)
(300,000)
(3,420)
(5,323)
1,229,181
1,755,930
Net (decrease)/ increase in cash and cash equivalents
353,785
(53,397)
Cash and cash equivalents at the beginning of the financial year
Effect of exchange rate changes on cash and cash equivalents
322,994
541,656
14,374
(165,265)
Cash and cash equivalents at the end of the financial year
16
691,153
322,994
The above Consolidated Statement of Cash Flows should be read in conjunction with the accompanying notes.
20
Oro Verde Limited Annual Report 2019 for the year ended 30 June 2019
Consolidated Statement of Changes in Equity
for the year ended 30 June 2019
Ordinary
shares
$
Convertible
notes
Reserve
$
Share
option
Reserve
$
Foreign Currency
Translation
Reserve
$
Accumulated
losses
$
Total
$
At 1 July 2018
23,157,805
136,403
5,038,101
(250,355)
(28,091,252)
(9,298)
Loss for the period
Other Comprehensive
loss
Total comprehensive
loss for the period
-
-
-
Transactions with owners in their capacity as owners
Shares issued during
the period
1,437,600
Transaction Costs
(92,399)
Share based payments
-
-
-
-
-
-
-
-
-
-
-
-
288,096
-
(978,314)
(978,314)
15,489
-
15,489
15,489
(978,314)
(962,825)
-
-
-
-
-
-
1,437,600
(92,399)
288,096
At 30 June 2019
24,503,006
136,403
5,326,197
(234,866)
(29,069,566)
661,174
Ordinary
shares
$
Convertible
notes
Reserve
$
Share
option
Reserve
$
Foreign Currency
Translation
Reserve
$
Accumulated
losses
$
Total
$
At 1 July 2017
21,487,918
136,403
4,810,101
(85,324)
(26,086,671)
262,427
Loss for the period
Other Comprehensive
loss
Total comprehensive
loss for the period
-
-
-
Transactions with owners in their capacity as owners
Shares issued during
the period
1,707,634
Transaction Costs
(37,747)
Share based payments
-
-
-
-
-
-
-
-
-
-
-
-
228,000
-
(2,004,581)
(2,004,581)
(165,031)
-
(165,031)
(165,031)
(2,004,581)
(2,169,612)
-
-
-
-
-
-
1,707,634
(37,747)
228,000
At 30 June 2018
23,157,805
136,403
5,038,101
(250,355)
(28,091,252)
(9,298)
The above Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying notes.
21
Notes to the Consolidated Financial Statements
for the year ended 30 June 2019
1. CORPORATE INFORMATION
The Consolidated Financial report of Oro Verde Limited for the year ended 30 June 2019 was authorised for issue in accordance
with a resolution of the directors on 23 September 2019. The consolidated financial statements and notes represent those of Oro
Verde Limited and its controlled entities (the “Group”). The consolidated entity’s functional and presentation currency is AUD ($).
The separate financial statements of the parent entity, Oro Verde Limited, have not been presented within this financial report as
permitted by the Corporations Act 2001.
Oro Verde Limited is a company limited by shares incorporated in Australia whose shares are publicly traded on the Australian
Securities Exchange.
The nature of the operations and principal activities of the Group are described in the Directors’ Report.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a) Basis of Preparation
The Financial report is a general-purpose Financial report, which has been prepared in accordance with the requirements of the
Corporations Act 2001, Australian Accounting Standards, Australian Accounting Interpretations and other authoritative pronouncements
of the Australian Accounting Standards Board. The Financial report has also been prepared on an accruals basis and is based on
historical cost basis, except for certain available-for-sale financial assets, which have been measured at fair value. The Group is a for-
profit entity for the purpose of preparing the financial statements.
Australian Accounting Standards set out accounting policies that the AASB has concluded that would result in a financial report
containing relevant and reliable information about transactions, events and conditions. Compliance with Australian Accounting
Standards ensures that the financial reports and notes also comply with International Financial Reporting Standards.
Going Concern
This report has been prepared on the going concern basis, which contemplates the continuity of normal business activity and the
realisation of assets and settlement of liabilities in the normal course of business.
The Consolidated Entity has incurred a net loss after tax for the year ended 30 June 2019 of $978,314 (2018: $2,004,581) and
experienced net cash outflows from operating activities of $934,585 (2018: $1,808,433). At 30 June 2018, the Consolidated Entity had
net current assets of $661,164 (2018: net current liabilities $28,334).
The ability of the Consolidated Entity to continue as a going concern is dependent on securing additional funding either through the
issue of further shares, convertible notes or a combination of both in order to continue to actively explore its mineral properties
These conditions indicate a material uncertainty that may cast significant doubt about the Consolidated Entity’s ability to continue as
a going concern and therefore, that it may be unable to realise its assets and discharge its liabilities in the normal course of business.
The Directors believe that on successful completion of fund raising activities referred to above there will be sufficient funds to meet
the Consolidated Entity’s working capital requirements and as at the date of this report the Consolidated Entity believes it can meet
all liabilities as and when they fall due.
The Directors have reviewed the business outlook and the assets and liabilities of the Consolidated Entity and are of the opinion that
the use of the going concern basis of accounting is appropriate as they believe the Consolidated Entity will continue to be successful in
securing additional funds through debt or equity issues or partial sale of its mineral properties as and when the need to raise working
capital arises. The Directors note that on 11 July 2019 the Company completed a share placement of 200,000,000 shares at $0.003
each to raise $600,000 (before expenses of the issue) and on 17 September a further $706,320 (before expenses of the issue) was
raised through the issue of 117,720,000 shares.
Should the Consolidated Entity not be able to continue as a going concern, it may be required to realise its assets and discharge its
liabilities other than in the ordinary course of business, and at amounts that differs from those stated in the financial statements. The
financial report does not include any adjustments relating to the recoverability and classification of recorded assets or liabilities that
may be necessary if the Consolidated Entity is unable to continue as a going concern.
22
Oro Verde Limited Annual Report 2019 for the year ended 30 June 2019
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(b) Adoption of new and amended accounting standards
The accounting policies adopted are consistent with those of the previous financial year and corresponding reporting period except
for the adoption of the new standards and amendments which became mandatory for the first time this reporting period commencing
1 July 2018. The adoption of these standards and amendments did not result in a material adjustment to the amounts or disclosures
in the current or prior year. The Group has not early adopted any other standard, interpretation or amendment that has been issued
but is not yet effective.
The following relevant standards and interpretations have been issued by the Australian Accounting Standards Board (AASB) but are
not yet effective for the year ending 30 June 2019:
The accounting policies adopted in the preparation of the interim consolidated financial statements are consistent with those followed
in the preparation of the Group’s annual consolidated financial statements for the year ended 30 June 2018, except for the adoption
of new standards effective as of 1 July 2018. The Group has not early adopted any other standard, interpretation or amendment that
has been issued but is not yet effective.
From 1 July 2018 the Group had applied, for the first time, AASB 15 Revenue from Contracts with Customers (AASB 15) and AASB 9
Financial Instruments (AASB 9). The nature and effect of these changes are disclosed below.
Adoption of AASB 15
AASB 15 and its related amendment supersede AASB 111 Construction Contracts, AASB 118 Revenue and related interpretations
and it applied to all revenue arising from contracts with customers, unless those contracts are in the scope of other standards. The
new standard establishes a five-step model to account for revenue arising from contracts with customers. Under AASB 15, revenue is
recognised at an amount that reflects the consideration to which an entity expects to be entitled in exchange for transferring goods
or services a customer.
At 1 July 2017 and at 1 July 2018 it was determined that the adoption of AASB 15 had no impact on the Group as the Group has not
generated any revenue from contracts with customers as yet.
Adoption of AASB 9
AASB 9 replaces AASB 139 Financial Instruments: Recognition and Measurement (AASB 139) for annual periods beginning on or
after 1 January 2018, bringing together all three aspects of the accounting for financial instruments: classification and measurement;
impairment and hedge accounting.
AASB 9 sets out requirements for recognising and measuring financial assets, financial liabilities and some contracts to buy or sell
non-financial items. The Group has adopted AASB 9 retrospectively in accordance with the standard. Changes in accounting polices
resulting from the adoption of AASB 9 did not have a material impact on the Company’s consolidated financial statements on transition
or during the half-year.
AASB 9 largely retains the existing requirements of AASB 139 for the classification and measurement of financial liabilities, however it
eliminates the previous AASB 139 categories for financial assets held to maturity, loans and receivables and available for sale financial
assets. Under AASB 9, on initial recognition a financial asset is classified as measured at either:
(a) Amortised cost;
(b) Fair Value through Other Comprehensive Income (“FVOCI”) – debt investment;
(c) FVOCI – equity investment; or
(d) Fair Value through Profit or Loss (“FVTPL”).
The classification of financial assets under AASB 9 is generally based on the business model in which a financial asset is managed and
its contractual cash flow characteristics. A financial asset (unless it is a trade receivable without a significant financing component that
it initially measured at the transaction price) is initially measured at fair value plus, for an item not a FVTPL, transaction costs that are
directly attributable to its acquisition. For financial assets measured at amortised cost, these assets are subsequently measured at
amortised cost using the effective interest rate method. The amortised cost is reduced by impairment losses.
Interest income, foreign exchange gains and losses and impairment are recognised in profit or loss. Any gain or loss on recognition is
recognised in profit or loss.
As of 30 June 2019, the Group’s financial instruments consist of cash and cash equivalents, other receivables and trade and other
payables.
Cash and cash equivalents and other receivables previously designated as receivables under AASB 139 are now classified as amortised
cost under AASB 9. The trade and other payables are designated as other financial liabilities, which are measured at amortised cost.
23
Notes to the Consolidated Financial Statements
for the year ended 30 June 2019
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(b) Adoption of new and amended accounting standards (Continued)
Interest income, foreign exchange gains and losses and impairment are recognised in profit or loss. Any gain or loss on recognition is
recognised in profit or loss.
As of 30 June 2019, the Group’s financial instruments consist of cash and cash equivalents, other receivables and trade and other
payables.
Cash and cash equivalents and other receivables previously designated as receivables under AASB 139 are now classified as amortised
cost under AASB 9. The trade and other payables are designated as other financial liabilities, which are measured at amortised cost.
Impairment of financial assets
In relation to the financial assets carried at amortised cost, AASB 9 requires an expected credit loss (“ECL”) model to be applied as
opposed to an incurred credit loss model under AASB 139. The ECL model requires the Group to account for expected credit losses
and changes in those expected credit losses at each reporting date to reflect changes in credit risk since initial recognition of the
financial asset. In particular, AASB 9 requires the Group to measure the loss allowance at an amount equal to the lifetime expected
credit loss. If the credit risk on the financial instrument has not increased significantly since initial recognition, the Group is required to
measure the loss allowance for that financial instrument at an amount equal to the ECL within the next 12 months.
As at 1 July 2018, the directors of the Company reviewed and assessed the Group’s existing financial assets for impairment using
reasonable and supportable information. In accordance with AASB 9, where the directors concluded that it would require undue cost
and effort to determine the credit risk of a financial asset on initial recognition, the Group recognises lifetime ECL. The result of the
assessment is as follows:
Class of financial instrument presented
in the statement of financial position
Original measurement category under
AASB 139
New measurement category under
AASB 9
Cash and cash equivalents
Receivables
Loans and receivables
Loans and receivables
Financial assets at amortised cost
Financial assets at amortised cost
Trade and other payables
Financial Liability at amortised cost
Financial liability at amortised cost
The change in classification has not resulted in any re-measurement adjustment at 1 July 2018.
(c) Basis of consolidation
The parent entity and its subsidiaries are collectively referred to as the "Group". The parent of this Group is Oro Verde Limited. Entities
(including structured entities) over which the parent (or the Group) directly or indirectly exercises control are called “subsidiaries".
The consolidated financial statements incorporate the assets, liabilities and results of all subsidiaries. The Group controls an entity
when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those
returns through its power over the entity. A list of the Group's subsidiaries is provided in Note 11.
The assets, liabilities and results of subsidiaries are fully consolidated into the financial statements of the Group from the date
on which control is obtained by the Group. The consolidation of a subsidiary is discontinued from the date that control ceases.
Intercompany transactions, balances and unrealised gains or losses on transactions between group companies are fully eliminated on
consolidation. Accounting policies of subsidiaries have been changed and adjustments made where necessary to ensure uniformity of
the accounting policies adopted by the Group.
Equity interests in a subsidiary not attributable, directly or indirectly, to the Group are referred to as ‘non-controlling interests’. The
Group recognises any non-controlling interests in subsidiaries on a case-by-case basis either at fair value or at the non-controlling
interests’ proportionate share of the subsidiary’s net assets. Non-controlling interests are shown separately within the equity section
of the statement of financial position and statement of profit or loss and other comprehensive income.
24
Oro Verde Limited Annual Report 2019 for the year ended 30 June 2019
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(d) Significant accounting estimates and assumptions
The carrying amounts of certain assets and liabilities are often determined based on estimates and assumptions of future events. The
key estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of certain assets
and liabilities within the next annual reporting period are:
Share based payments
The Company 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 the binominal or implied barrier formula. For options issued
in this financial year, the assumptions detailed as per Note 25 were used.
Exploration and evaluation costs
Exploration and evaluation costs are written off in the year they are incurred apart from acquisition costs which are carried forward
where right of tenure of the area of interest is current. The future recoverability of exploration and evaluation expenditure is dependent
on a number of factors, including whether the Group decides to exploit the related lease itself, or, if not, whether it successfully
recovers the related exploration and evaluation assets through sale.
Factors that could impact the future recoverability include the level of reserves and resources, future technological changes, which
could impact the cost of mining, future legal changes (including changes to environmental restoration obligations) and changes to
commodity prices.
To the extent that capitalised exploration and evaluation expenditure is determined not to be recoverable in the future, profits and
net assets will be reduced in the period in which this determination is made.
(e) Interests in joint ventures
The Groups share of the assets, liabilities, revenue and expenses of joint venture operations are included in the appropriate items of
the consolidated statement of profit or loss and other comprehensive income and statement of financial position.
(f) Revenue Recognition
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be
reliably measured. The following specific recognition criteria must also be met before revenue is recognised:
Rendering of services
Revenue is recognised as the services are provided.
Interest
Revenue is recognised as the interest accrues using the effective interest method. This is a method of calculating the amortised cost
of a financial asset and allocating the interest income over the relevant period using the effective interest rate, which is the rate that
exactly discounts estimated future cash receipts through the expected life of the financial asset to the net carrying amount of the
financial asset.
Dividends
Revenue is recognised when the entity’s right to receive the payment is established.
(g) Borrowing costs
Borrowing costs are recognised as an expense when incurred.
25
Notes to the Consolidated Financial Statements
for the year ended 30 June 2019
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(h) Leases
Leases are classified at their inception as either operating or finance leases based on the economic substance of the agreement so as
to reflect the risks and benefits incidental to ownership.
Finance leases, which transfer to the Group substantially all the risks and benefits incidental to ownership of the leased item, are
capitalised at the inception of the lease at the fair value of the leased property or, if lower, at the present value of the minimum lease
payments.
Lease payments are apportioned between the finance charges and reduction of the lease liability so as to achieve a constant rate of
interest on the remaining balance of the liability. Finance charges are charged directly against income.
Capitalised leased assets are depreciated over the shorter of the estimated useful life of the asset or the lease term.
Leases where the lessor retains substantially all the risks and benefits of ownership of the asset are classified as operating leases.
Initial direct costs incurred in negotiating an operating lease are added to the carrying amount of the leased asset and recognised over
the lease term on the same bases as the lease income.
Operating lease payments are recognised as an expense in the statement of profit or loss and other comprehensive income on a
straight-line basis over the lease term.
(i) Cash and cash equivalents
Cash and cash equivalents in the statement of financial position comprise cash at the bank and short-term deposits with an original
maturity of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk
of changes in value.
(j)
Other receivables
Other receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest
method, less an allowance for impairment.
(k) Foreign currency translation
Both the functional and presentation currency of Oro Verde Limited and its Australian subsidiaries is Australian dollars (A$).
Transactions in foreign currencies are initially recorded in the functional currency at the exchange rates ruling at the date of the
transaction. Monetary assets and liabilities denominated in foreign currencies are translated at the rate of exchange ruling at the end
of the reporting period. Non-monetary items measured at historical cost continue to be carried at the exchange rate at the date of
the transaction.
All resulting exchange differences in the consolidated financial statements are taken to the statement of profit or loss and other
comprehensive income.
Group companies
The financial results and position of foreign operations, whose functional currency is different from the Group’s presentation currency,
are translated as follows:
• Assets and liabilities are translated at exchange rates prevailing at the end of the reporting period;
•
Income and expenses are translated at average exchange rates for the period; and
• Retained earnings are translated at the exchange rates prevailing at the date of the transaction.
Exchange differences arising on translation of foreign operations with functional currencies other than Australian dollars are
recognised in other comprehensive income and included in the foreign currency translation reserve in the statement of financial
position. These differences are recognised in profit or loss in the period in which the operation is disposed.
26
Oro Verde Limited Annual Report 2019 for the year ended 30 June 2019
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(l)
Income tax
Current tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from or paid
to the taxation authorities based on the current period's taxable income. The tax rates and tax laws used to compute the amount are
those that are enacted or substantively enacted by the end of the reporting period.
Deferred income tax is provided on all temporary differences at the end of the reporting period between the tax bases of assets and
liabilities and their carrying amounts for financial reporting purposes.
Deferred income tax liabilities are recognised for all taxable temporary differences except:
• when the deferred income tax liability arises from the initial recognition of goodwill or of an asset or liability in a transaction
that is not a business combination and that, at the time of the transaction, affects neither the accounting profit nor taxable
profit or loss; or
• when the taxable temporary difference is associated with investments in subsidiaries, associates or interests in joint ventures,
and the timing of the reversal of the temporary difference can be controlled and it is probable that the temporary difference
will not reverse in the foreseeable future.
Deferred income tax assets are recognised for all deductible temporary differences, carry-forward of unused tax credits and unused
tax losses, to the extent that it is probable that taxable profit will be available against which the deductible temporary differences and
the carry-forward of unused tax credits and unused tax losses can be utilised, except:
• when the deferred income tax asset relating to the deductible temporary difference arises from the initial recognition of an
asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the
accounting profit nor taxable profit or loss; or
• when the deductible temporary difference is associated with investments in subsidiaries, associates or interests in joint
ventures, in which case a deferred tax asset is only recognised to the extent that it is probable that the temporary difference
will reverse in the foreseeable future and taxable profit will be available against which the temporary difference can be utilised.
The carrying amount of deferred income tax assets is reviewed at each end of the reporting period and reduced to the extent that it
is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred income tax asset to be utilised.
Unrecognised deferred income tax assets are reassessed at each end of the reporting period and are recognised to the extent that it
has become probable that future taxable profit will allow the deferred tax asset to be recovered.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is
realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the end of the
reporting period.
Income taxes relating to items recognised directly in equity are recognised in equity and not in profit or loss.
Deferred tax assets and deferred tax liabilities are offset only if a legally enforceable right exists to set off current tax assets against
current tax liabilities and the deferred tax assets and liabilities relate to the same taxable entity and the same taxation authority.
Tax consolidation legislation
Oro Verde Limited and its wholly owned Australian controlled entities have implemented the tax consolidation legislation as of
1 July 2003.
The head entity, Oro Verde Limited and the controlled entities in the tax consolidated group continue to account for their own current
and deferred tax amounts. The Group has applied the group allocation approach in determining the appropriate amount of current
taxes and deferred taxes to allocate to members of the tax consolidated group.
(m) Other taxes
Revenues, expenses and assets are recognised net of the amount of GST except:
• where the GST incurred on a purchase of goods and services is not recoverable from the taxation authority, in which case the
GST is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable; and
•
receivables and payables are stated with the amount of GST included.
The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the
statement of financial position.
Cash flows are included in the Statement of Cash Flows on a gross basis and the GST component of cash flows arising from investing
and financing activities, which is recoverable from, or payable to, the taxation authority, are classified as operating cash flows.
Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the taxation authority.
27
Notes to the Consolidated Financial Statements
for the year ended 30 June 2019
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(n) Property, plant and equipment
Plant and equipment is stated at cost less accumulated depreciation and any impairment in value.
Depreciation is calculated on a reducing balance basis over the assets estimated useful life as follows:
• Office equipment and fittings - 2.5 to 5.0 years
(o) Impairment of non financial assets
At each end of the reporting period, the Group assesses whether there is any indication that an asset may be impaired.
Where an indicator of impairment exists, the Group makes a formal estimate of recoverable amount.
Recoverable amount is the greater of fair value less costs to sell and value in use. It is determined for an individual asset, unless the
asset’s value in use cannot be estimated to be close to its fair value less costs to sell and it does not generate cash inflows that are
largely independent of those from other assets or groups of assets, in which case, the recoverable amount is determined for the cash-
generating unit to which the asset belongs.
At each end of the reporting period, the Group assesses whether there is any indication that an asset may be impaired.
Where an indicator of impairment exists, the Group makes a formal estimate of recoverable amount.
Recoverable amount is the greater of fair value less costs to sell and value in use. It is determined for an individual asset, unless the
asset’s value in use cannot be estimated to be close to its fair value less costs to sell and it does not generate cash inflows that are
largely independent of those from other assets or groups of assets, in which case, the recoverable amount is determined for the cash-
generating unit to which the asset belongs.
Where the carrying amount of an asset or cash generating unit exceeds its recoverable amount the asset or cash generating unit is
considered impaired and is written down to its recoverable amount.
In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that
reflects current market assessments of the time value of money and the risks specific to the asset.
(p) Trade and other payables
Trade payables and other payables are carried at amortised costs and represent liabilities for goods and services provided to the
Group prior to the end of the financial year that are unpaid and arise when the Group becomes obliged to make future payments in
respect of the purchase of these goods and services.
(q) Provisions
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that
an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of
the amount of the obligation.
Where the Group expects some or all of a provision to be reimbursed, for example under an insurance contract, the reimbursement
is recognised as a separate asset but only when the reimbursement is virtually certain. The expense relating to any provision is
presented in the statement of profit or loss and other comprehensive income net of any reimbursement.
If the effect of the time value of money is material, provisions are determined by discounting the expected future cash flows at a pre-
tax rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the liability.
Where discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost.
28
Oro Verde Limited Annual Report 2019 for the year ended 30 June 2019
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(r) Share-based payment transactions
The Group provides benefits to directors, employees and consultants of the Group (with shareholders’ approval) in the form of share-
based payment transactions, whereby directors, employees and consultants render services in exchange for options over shares
(‘equity-settled transactions’).
The cost of these equity-settled transactions with employees is measured by reference to the fair value at the date at which they are
granted. The fair value is determined by an external valuer using a binomial model.
In valuing equity-settled transactions, no account is taken of any performance conditions, other than conditions linked to the price of
the shares of Oro Verde Limited (‘market conditions’).
The cost of equity-settled transactions is recognised, together with a corresponding increase in equity, over the period in which
the performance conditions are fulfilled, ending on the date on which the relevant employees become fully entitled to the
award (‘vesting date’).
The cumulative expense recognised for equity-settled transactions at each End of the reporting period until vesting date reflects (i)
the extent to which the vesting period has expired and (ii) the number of awards that, in the opinion of the directors of the Group,
will ultimately vest. This opinion is formed based on the best available information at reporting date. No adjustment is made for the
likelihood of market performance conditions being met as the effect of these conditions is included in the determination of fair value
at grant date.
No expense is recognised for awards that do not ultimately vest, except for awards where vesting is conditional upon a market
condition. Where the terms of an equity-settled award are modified, as a minimum an expense is recognised as if the terms had not
been modified. In addition, an expense is recognised for any increase in the value of the transaction as a result of the modification,
as measured at the date of modification.
Where an equity-settled award is cancelled, it is treated as if it had vested on the date of cancellation, and any expense not yet
recognised for the award is recognised immediately. However, if a new award is substituted for the cancelled award and designated
as a replacement award on the date that it is granted, the cancelled and new award are treated as if they were a modification of the
original award, as described in the previous paragraph.
The dilutive effect, if any, of outstanding options is reflected as additional share dilution in the computation of earnings per share.
(s) Employee leave benefits
(a) Short term employee benefits
Liabilities for wages and salaries, including non-monetary benefits expected to be settled wholly within 12 months of the end of the
reporting period are recognised in other payables in respect of employees’ services up to the end of the reporting period. They are
measured at the undiscounted amounts expected to be paid when the liabilities are settled.
The Group’s obligations for employees’ annual leave and long service leave entitlements are recognised as provisions in the statement
of financial position.
(b) Long term employee benefits
The liability for long service leave and annual leave entitlements not expected to be settled wholly within 12 months are 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. 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 currencies that match, as closely as possible, the
estimated future cash outflows.
The Group’s obligations for long term employee benefits are presented as non-current provisions in the statement of financial position,
except where the Group does not have an unconditional right to defer settlement for at least 12 months after the end of the reporting
period, in which case the obligations are presented as current provisions.
29
Notes to the Consolidated Financial Statements
for the year ended 30 June 2019
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(t) Contributed equity
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in
equity as a deduction, net of tax, from the proceeds.
Effective 1 July 1998, the corporations legislation abolished the concepts of authorised capital and par value shares. Accordingly, the
company does not have authorised capital nor par value in respect of its issued capital.
Basic earnings per share is calculated as net profit attributable to members of the parent, adjusted to exclude any costs of servicing
equity (other than dividends) and preference share dividends, divided by the weighted average number of ordinary shares, adjusted
for any bonus element.
(u) Earnings per share
Diluted earnings per share is calculated as net profit attributable to members of the parent, adjusted for:
•
•
costs of servicing equity (other than dividends) and preference share dividends;
the after tax effect of dividends and interest associated with dilutive potential ordinary shares that have been recognised as
expenses; and
• other non-discretionary changes in revenues or expenses during the period that would result from the dilution of potential
ordinary shares:
• divided by the weighted average number of ordinary shares and dilutive potential ordinary shares, adjusted for any bonus
element.
(v) Comparative figures
When required by accounting standards comparative figures have been adjusted to conform to changes in the presentation for the
current financial year.
(w) Exploration and development expenditure
Exploration and evaluation costs are written off in the year they are incurred apart from acquisition costs which are carried forward
where right of tenure of the area of interest is current and they are expected to be recouped through sale or successful development
and exploitation of the area of interest or, where exploration and evaluation activities in the area of interest have not reached a stage
that permits reasonable assessment of the existence of economically recoverable reserves.
Where an area of interest is abandoned or the directors decide that it is not commercial, any accumulated acquisition costs in respect
of that area are written off in the financial period the decision is made. Each area of interest is also reviewed at the end of each
accounting period and accumulated costs written off to the extent that they will not be recoverable in the future.
Amortisation is not charged on costs carried forward in respect of areas of interest in the development phase until production
commences.
Farm-In policy
The farmee accounts for its expenditure under a farm-in arrangement in the same way as directly incurred exploration expenditure.
Farm-out policy
The farmor records expenditure made on behalf of the farmee but offsets any reimbursements for this expenditure. Not gain or loss
on farm-out arrangement is recognised.
(x) Fair Value Assets and Liabilities
The Group measures some of the assets and liabilities it holds at fair value on either a recurring or non-recurring basis, depending on
the requirements of the applicable Accounting Standard (for the respective accounting policies of such assets and liabilities, refer to
the latest annual financial statements). ‘Fair value’ is the price that would be received to sell an asset or paid to transfer a liability in an
orderly (ie. unforced) transaction between independent, knowledgeable and willing buyers and sellers operating in a market. “Market’
is taken to mean either a market with the greatest volume and level at activity for such asset or liability, or a market that maximises
the receipts from the sale of’ an asset or minimises the payment made to transfer a liability after taking into account transaction costs
and transport costs.
30
Oro Verde Limited Annual Report 2019 for the year ended 30 June 2019
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Valuation techniques
The Group selects and uses one or more valuation techniques to measure the fair values of a particular 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:
Valuation techniques
The Group selects and uses one or more valuation techniques to measure the fair values of a particular 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”.
Fair value hierarchy
The Group adopts a ‘fair value hierarchy” to categorise the fair value measurements derived from the valuation techniques into
three levels (as described below). The purpose of this classification is to indicate the relative subjectivity of the fair values derived.
This classification is made by prioritising the inputs used in each valuation technique on the basis of the extent to which such inputs
are observable.
Level 1
Level 2
Level 1 fair values are
considered to be the best
indication (and therefore
the most reliable evidence)
of fair value. Inputs used to
measure Level 1 fair values are
unadjusted quoted prices for
identical assets /liabilities in
active markets (eg Australian
Securities Exchange) where
transactions take place with
sufficient frequency and volume
to provide pricing information
on an ongoing basis.
Inputs used to measure Level 2 fair values are inputs (other than
quoted prices included in Level 1) that are observable either
directly or indirectly. Level 2 inputs include:
• quoted prices for similar assets/liabilities in active
markets;
• quoted prices for similar or identical assets/liabilities in
non-active markets;
•
foreign exchange rates;
• market interest rates;
•
•
•
yield curves observable at commonly quoted intervals;
implied volatilities; and
credit spreads.
Level 3
Level 3 fair values use
unobservable inputs
specific to the particular
asset or liability because
observable inputs are
not available for such
asset or liability.
The Group would change the categorisation within the fair value hierarchy only in the following circumstances:
(i)
if a market that was previously considered active (Level 1) became inactive (Level 2 or 3) or vice versa; or
(ii)
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 (ie transfers into
and out of each level of the fair value hierarchy) on the date the event or change in circumstances occurred.
31
Notes to the Consolidated Financial Statements
for the year ended 30 June 2019
3. REVENUE
The Group derives the following types of income:
Interest received
Profit on minerals concession sale
Profit on plant and equipment sale
Management fee and rental income
4. EXPENSES AND LOSSES
Profit/(loss) from continuing operations before income tax includes the following specific expenses:
Depreciation on equipment
Salaries & wages expenses
Operating lease rentals
Directors’ benefit expense (excluding executive directors)
Exploration expenses
Exploration expenditure reimbursed
5. INCOME TAX
The major components of income tax expense are:
Statement of profit or loss and other comprehensive income
Current income tax benefit/(expense)
Deferred income tax benefit/(expense)
Income tax benefit/(expense) reported in the statement of profit or loss and other
comprehensive income
2019
$
4,138
57,592
13,596
-
2019
$
3,354
249,861
23,588
107,233
186,831
-
2019
$
-
-
-
2018
$
2,252
-
-
13,866
2018
$
8,208
442,727
37,615
130,000
1,140,021
(382,162)
2018
$
-
-
-
A reconciliation between tax expense and the product of accounting profit/(loss) before income tax multiplied by the Group’s applicable
income tax rate is as follows:
Accounting loss before income tax
At the Group’s statutory income tax rate
Less: Share options expenses during the year
Exploration expenditure
Other expenditure not allowable for income tax purposes
Current year tax losses not brought to account
2019
$
(978,314)
(269,036)
79,226
51,379
6,786
(131,645)
131,645
2018
$
(2,004,581)
(551,260)
62,700
208,411
35,712
(244,437)
244,437
Income tax (benefit)/expense reported in the consolidated statement of profit or loss
and other comprehensive income
-
-
32
Oro Verde Limited Annual Report 2019 for the year ended 30 June 2019
Depreciation on equipment
Salaries & wages expenses
Operating lease rentals
Directors’ benefit expense (excluding executive directors)
Exploration expenses
Exploration expenditure reimbursed
Statement of profit or loss and other comprehensive income
Current income tax benefit/(expense)
Deferred income tax benefit/(expense)
Income tax benefit/(expense) reported in the statement of profit or loss and other
comprehensive income
Accounting loss before income tax
At the Group’s statutory income tax rate
Less: Share options expenses during the year
Exploration expenditure
Other expenditure not allowable for income tax purposes
Current year tax losses not brought to account
Income tax (benefit)/expense reported in the consolidated statement of profit or loss
and other comprehensive income
2019
$
2018
$
2019
$
3,354
249,861
23,588
107,233
186,831
-
-
-
-
-
2019
$
(978,314)
(269,036)
79,226
51,379
6,786
(131,645)
131,645
2018
$
8,208
442,727
37,615
130,000
1,140,021
(382,162)
-
-
-
-
2018
$
(2,004,581)
(551,260)
62,700
208,411
35,712
(244,437)
244,437
5. INCOME TAX (CONTINUED)
Deferred Income Tax
Deferred income tax at 30 June relates to the following:
Deferred tax liabilities
Prepayments
Total deferred tax liabilities
Deferred tax assets
Accrued expenses
Capital raising costs
Tax assets/losses recognised /(not brought to account)
Total deferred tax assets
2019
$
(1,836)
(1,836)
5,500
13,308
(16,972)
1,836
2018
$
(1,340)
(1,340)
22,000
13,324
(33,984)
1,340
Net deferred tax liabilities/(asset)
-
-
Other than to offset deferred tax liabilities the Group has not recognised tax losses arising in Australia of $12,268,908 (2018:
$11,811,775) that may be available for offset against future taxable profits of the companies in which the losses arose. The potential
benefit of carried forward losses will only be obtained if assessable income is derived of a nature and, of an amount sufficient to
enable the benefit from the deductions to be realised or the benefit can be utilised by the Company provided that:
(i)
the provisions of deductibility imposed by law are complied with;
(ii)
the group satisfies the continuity of ownership test from the period the losses were incurred to the time they are to be
utilised; and
(iii) no change in tax legislation adversely affect the realisation or the benefit from the deductions.
Tax Consolidation
Oro Verde Limited and its 100% owned Australian subsidiaries have formed a tax consolidated group. Members of the group entered
into a tax sharing arrangement in order to allocate the income tax expense to the wholly owned subsidiaries on a pro-rata basis. The
agreement provides for the allocation of income tax liabilities should the head entity default on its tax payment obligations. At the
reporting date, the possibility of default is remote.
Tax effect accounting by members of the tax consolidated group
The allocation of taxes under the tax sharing and funding agreement is recognised as an increase/decrease in the subsidiaries’ inter-
company accounts with the tax consolidated group head company, Oro Verde Limited. The group has applied the group allocation
approach in determining the appropriate amount of current taxes to allocate to members of the tax consolidated group.
33
Notes to the Consolidated Financial Statements
for the year ended 30 June 2019
6. RECEIVABLES (CURRENT)
Other receivables (a)
2019
$
28,722
28,722
2018
$
12,639
12,639
(a) These amounts generally arise from activities outside the usual operating activities. Interest is not usually charged and collateral is
not obtained. For the Group the receivable principally arises from consumption taxes paid to third party suppliers for which a refund
from tax authorities is expected.
As at 30 June, the ageing analysis of trade receivables is as follows:
Total
0-30 days
31-60 days
Other
31-60 days
PDNI*
61-90 days
PDNI*
91+ days
PDNI*
91+days
CI*
30 June 2019 Consolidated
30 June 2018 Consolidated
28,722
12,639
28,722
12,639
-
-
-
-
-
-
-
-
-
-
* Past due not impaired (‘PDNI’), Considered impaired (‘CI’)
(b) Fair value and credit risk
Details regarding the fair value and credit risk of current receivables are disclosed in Note 23.
(c) Foreign exchange and interest rate risk
Details regarding foreign exchange and interest rate risk exposure are disclosed in Note 23.
7. OTHER (CURRENT)
Prepayments – Insurance
2019
$
6,677
2018
$
4,872
34
Oro Verde Limited Annual Report 2019 for the year ended 30 June 2019
8. OPERATING SEGMENT
The Group has based its operating segment on the internal reports that are reviewed and used by the Board of Directors (“Board”) (the
chief operating decision makers) in assessing performance and in determining the allocation of resources.
The Group does not have production and is only currently involved in exploration activities. As a consequence, activities in the operating
segment are identified by the Board based on the manner in which resources are allocated and the nature of the resources provided.
Based on this criterion, the Board has determined that the Group has one operating segment, being exploration, and the segment
operations and results are the same as the Groups results.
During the period the Company conducted its activities across two geographic locations, being Australia and Nicaragua.
2019
Revenues
Loss
Non-current assets
Total assets
Total liabilities
2018
Revenues
Loss
Non-current assets
Total assets
Total liabilities
Australia
$
Nicaragua
$
4,138
71,188
Total
$
75,326
(779,904)
(198,410)
(978,314)
-
686,449
(63,367)
-
40,103
(2,011)
Australia
$
Nicaragua
$
2,252
13,866
-
726,552
(65,378)
Total
$
16,118
(1,021,332)
(983,249)
(2,004,581)
-
330,406
19,036
29,135
19,036
359,541
(222,456)
(146,383)
(368,839)
35
Notes to the Consolidated Financial Statements
for the year ended 30 June 2019
9. PLANT AND EQUIPMENT
Year ended 30 June 2018
At 1 July 2017, net of accumulated depreciation and impairment
Additions
Depreciation expense for the year
Exchange differences
At 30 June 2018, net of accumulated depreciation and impairment
At 30 June 2018
Cost
Accumulated depreciation and impairment
Net carrying amount
Motor Vehicles Office equipment
and fittings
$
19,312
-
(5,177)
(12)
14,123
26,498
(12,375)
14,123
6,805
894
(3,031)
245
4,913
15,683
(10,770)
4,913
Motor Vehicles Office equipment
and fittings
$
Total
$
26,117
894
(8,208)
233
19,036
42,181
(23,145)
19,036
Total
$
Year ended 30 June 2019
At 1 July 2018, net of accumulated depreciation and impairment
Additions
Disposals
Depreciation on disposals
Depreciation expense for the year
Exchange differences
At 30 June 2019, net of accumulated depreciation and impairment
At 30 June 2019
Cost
Accumulated depreciation and impairment
Net carrying amount
14,123
-
(26,498)
14,668
(2,221)
(72)
-
-
-
-
10. EXPLORATION AND EVALUATION EXPENDITURE
At Cost
Impairment of exploration & evaluation expenditure
Carrying amount at the end of the financial year
Carrying amount at the beginning of the financial year
Additions
Exploration written off on San Isidro concession which is to be relinquished
Exchange differences
Carrying amount at the end of the financial year
36
4,913
-
19,036
-
(15,683)
(42,181)
11,952
(1,133)
(49)
26,620
(3,354)
(121)
-
-
-
-
2019
$
-
-
-
-
-
-
-
-
-
-
-
-
2018
$
47,827
(47,827)
-
47,827
-
(47,827)
-
-
Oro Verde Limited Annual Report 2019 for the year ended 30 June 2019
10. EXPLORATION AND EVALUATION EXPENDITURE (CONTINUED)
Recovery of the capitalised amount is dependent upon:
(i)
the continuance of the Group’s right to tenure of the area of interest;
(ii)
the results of future exploration; and
(iii) the successful development and commercial exploitation, or alternatively sale.
11. INTEREST IN SUBSIDIARIES
The subsidiaries listed below have share capital consisting solely of ordinary shares.
Each country of incorporation is also its principal place of business.
(Non current)
Name of Subsidiary
Goldcap Resources Pty Limited
And its subsidiary
Minera San Cristobal, S.A.
Country of
Incorporation
Australia
% equity held
by consolidated
entity
2019
100
2018
100
Nicaragua
100
100
There are no significant restrictions over the Group’s ability to access or use assets and settle liabilities of the group.
12. PAYABLES (CURRENT)
Trade creditors and accruals
Loan from related party (note 12(a) and 22(e)
2019
$
65,378
-
65,378
2018
$
268,839
100,000
368,839
(a) The loan payable is due to Inkjar Pty Ltd an entity associated with Dr Bradford Farrell, a director of the Company. Interest on the
loan is calculated as NAB Business Loan Base plus 3%, calculated daily. This loan was repaid in full during the financial year. Refer
to note 22(e) for further details.
13. PROVISIONS (CURRENT)
Employee benefits
Opening balance at 1 July
Additional provision
Amount used
Balance at 30 June
Other than directors as at 30 June 2019 the Group has one employee (2018: four)
Current leave obligations are expected to be settled within 12 months.
2019
$
2018
$
-
-
-
-
-
-
-
-
-
-
37
Notes to the Consolidated Financial Statements
for the year ended 30 June 2019
14. CONTRIBUTED EQUITY
(a) Issued and paid up capital
Fully paid ordinary shares
Less: capital raising costs
2019
$
26,422,398
(1,919,392)
24,503,006
2018
$
24,984,798
(1,826,993)
23,157,805
Ordinary shares entitle the holder to participate in dividends and the proceeds on winding up of the Company in proportion to the
number and amounts paid on the shares held. On a show of hands every holder of ordinary shares present at a meeting in person or
by proxy is entitled to one vote, and upon a poll each share is entitled to one vote.
(b) Movements in ordinary share capital
Beginning of the financial year
982,706,835
23,157,805
695,196,590
21,487,918
2019
2018
Number of shares
$
Number of shares
$
Issued during the year
Issue at $0.0025 (i)
Issue at $0.0042 (ii)
Issue at $0.0100 (iii)
Issue at $0.0146 (iv)
Issue at $0.0080 (i)
Issue at $0.0086 (ii)
Issue at $0.0025 (ii)
Cost of share issues
570,000,000
2,971,698
1,425,000
12,600
-
-
-
-
-
-
-
-
-
-
-
(92,399)
-
-
5,000,000
349,315
-
-
50,000
5,100
171,750,000
1,374,000
410,930
110,000,000
-
3,534
275,000
(37,747)
End of the financial year
1,555,678,533
24,503,006
982,706,835
23,157,805
(i) Funds raised from the share placements during the 2019 and 2018 year were used to progress the Group’s exploration activities
and for general working capital.
(ii) Issued in lieu of directors’ fees and executive service fees – shares issued based on volume average weighted price for the relevant
quarter.
(iii) Issued on the exercise of options
(iv) Issued for consulting services (refer to Note 25a).
(c) Movements in unlisted options on issue
At the date of this report, there were 435,000,000 (2018: 120,000,000) share options outstanding.
Issued
Exercised
Lapsed
Total number of Options
Balance at the beginning of the year
Share option movements during the year
Total options issued and lapsed in the year
to 30 June 2019
Balance at the end of the year
340,000,0001
-
25,000,000
120,000,000
315,000,000
435,000,000
1. These options were issued free as attaching options to shares issued as part of a capital raising completed in July 2018.
38
Oro Verde Limited Annual Report 2019 for the year ended 30 June 2019
14. CONTRIBUTED EQUITY (CONTINUED)
The balance of options on issue is comprised of the following:
Date Granted
7 October 2014
27 November 2014
31 March 2015
15 December 2017
25 July 2018
Expiry Date
Exercise Price
(cents)
30 September 2019
30 September 2019
30 September 2019
30 November 2020
5.0
5.0
5.0
1.3
Number of
Options
66,000,000
5,000,000
2,000,000
22,000,000
31 July 2021
0.75
340,000,000
Total number of options outstanding at the date of this report
435,000,000
(d) Director and staff shares issued
During the year the following shares were issued in lieu of fees.
Specified Directors
W G Martinick
Total
(e) Capital Management
Number of Shares
2019
2,971,698
2,971,698
2018
760,245
760,245
When managing capital, management’s objective is to ensure the Group continues as a going concern as well as to maintain optimal
returns to shareholders and benefits for other stakeholders. Management also aims to maintain a capital structure that ensures the
lowest cost of capital available to the Group.
The Group is not exposed to any externally imposed capital requirements.
39
Notes to the Consolidated Financial Statements
for the year ended 30 June 2019
15. RESERVES
Share Option Reserve
Balance at beginning of year
Movement during the year
Balance at the end of year
Convertible Note Equity Reserve
Balance at beginning of year
Movement during the year
Balance at the end of year
Foreign Currency Translation Reserve
Balance at beginning of year
Movement during the year
Balance at the end of year
Nature and purpose of reserves
Share option reserve
2019
$
2018
$
5,038,101
288,096
5,326,197
4,810,101
228,000
5,038,101
136,403
136,403
-
-
136,403
136,403
(250,355)
15,489
(234,866)
(85,324)
(165,031)
(250,355)
This reserve records the value of options issued to directors, employees and associates as part of their remuneration.
Convertible note equity reserve
This reserve records the equity portion attributable to the convertible notes at the time of issue.
Foreign currency translation reserve
This reserve is used to record exchange differences arising from the translation of foreign controlled subsidiaries.
16. STATEMENT OF CASH FLOWS
Reconciliation of the net profit/(loss) after tax to the net cash flows from operations
Net loss
Depreciation of plant and equipment
Share based payments
Fees paid through share issue
Profit on asset sales
Capitalised exploration written off
Interest on director loan
Changes in assets and liabilities
Trade receivables
Prepayments
Trade and other creditors
Net cash flows used in operating activities
40
2019
$
2018
$
(978,314)
(2,004,581)
3,354
288,096
12,600
(42,392)
-
3,420
(16,083)
(1,805)
(203,461)
(934,585)
8,208
228,000
8,634
-
47,827
5,323
81,291
(235)
(182,900)
(1,808,433)
Oro Verde Limited Annual Report 2019 16. STATEMENT OF CASH FLOWS (CONTINUED)
(a) Reconciliation of cash
Cash balance comprises:
Cash at bank
Short term deposit
Closing cash balance
2019
$
657,652
33,501
691,153
2018
$
289,493
33,501
322,994
Cash at bank earns interest at floating rates based on daily bank deposit rates.
Short term deposits are made at various periods on call, depending on the immediate cash requirements of the Group and earn
interest at the respective short term deposit rates. At 30 June 2019, the Group had borrowing facilities of $30,000 (2018: $130,000).
The short term deposit is provided as security for $30,000 of the facilities. This facility is unutilised at 30 June 2019.
The fair value of cash and cash equivalents is $691,153 (2018: $322,994).
The effective interest rate on cash at bank was 1.0% (2018: 1.0%).
Refer to Note 23 for risk exposure.
17. EXPENDITURE COMMITMENTS
(a) Remuneration Commitments
Commitments for payment of salaries and other remuneration under employment contracts in existence at reporting date but not
recognised as liabilities, payable:
Not later than one year
Later than one year and not later than five years
2019
$
-
-
2018
$
45,000
-
45,000
18. EVENTS OCCURRING AFTER THE REPORTING PERIOD
On 11 July and 17 September 2019, the Company completed placements of 200,000,000 shares at $0.003 and 117,720,000 shares at
$0.006 to raise $600,000 and $706,320, respectively (before expenses of the issue).
On 6 September 2019 the Company issued 100,000,000 at a deemed price of $0.003 for consulting services. Additionally on the same
date 29,179,517 shares were issued as part payment for an initial 20% interest in Rwenzori Rare Metals Limited which holds 100% of
the Makuutu Rare Earths project in Uganda.
No other matter or circumstance has arisen since the end of the financial year which significantly affected or may significantly affect
the operations of the group, the results of those operations, or the state of affairs of the group in future financial years.
41
Notes to the Consolidated Financial Statements
for the year ended 30 June 2019
19. EARNINGS PER SHARE
Basic earnings per share amounts are calculated by dividing net profit for the year attributable to ordinary Owners of the parent,
adjusted to exclude any costs of servicing equity, divided by the weighted average number of ordinary shares, adjusted for any bonus
element.
Diluted earnings per share amounts are calculated by dividing the net profit attributable to ordinary Owners of the parent by the
weighted average number of ordinary shares during the year plus the weighted average number of ordinary shares that would be
issued on the conversion of all the dilutive potential ordinary shares into ordinary shares.
The following reflects the income / (loss) and share data used in the calculations of basic and diluted earnings per share:
(a) Basic and diluted earnings per share
From continuing operations attributable to the ordinary Owners of the company
(b) Reconciliations of earnings used in calculating earnings per share
Loss attributable to the ordinary Owners of the company used in calculating basic and
diluted earnings per share
2019
Cents
(0.06)
$
2018
Cents
(0.24)
$
From continuing operations
(978,314)
(2,004,581)
Weighted average number of ordinary shares on issue used in the calculation of continuing
and discontinued basic and diluted earnings per share
1,517,735,008
820,186,919
(c) Effect of dilutive securities
Options on issue at reporting date could potentially dilute basic earnings per share in the future. The effect in the current year is
to decrease the loss per share hence they are considered anti-dilutive. Accordingly diluted loss per share has not been disclosed.
20. AUDITOR’S REMUNERATION
Amounts received or due for an audit or review of financial statements:
BDO Audit (WA) Pty Ltd
Remuneration of other auditors of subsidiaries:
- an audit or review of financial report of subsidiaries
21. KEY MANAGEMENT PERSONNEL
Compensation of key management personnel by compensation
Short-term
Post employment
Share-based payment
42
2019
$
40,624
40,624
2018
$
40,091
40,091
-
12,150
2019
$
237,892
8,367
-
246,259
2018
$
332,435
26,175
194,044
552,654
Oro Verde Limited Annual Report 2019 for the year ended 30 June 2019
22. RELATED PARTY DISCLOSURE
(a) Subsidiaries
The consolidated financial statements include the financial statement of Oro Verde Limited and the subsidiaries listed in the
following table.
Name
Country of
incorporation
Equity interest
Investment
2019
%
100
100
2018
%
100
100
2019
$
2018
$
120,000
120,000
-
-
120,000
120,000
Goldcap Resources and its 100%
owned subsidiary
Australia
Minera San Cristobal, S.A.
Nicaragua
(b) Ultimate parent
Oro Verde Limited is the ultimate parent entity.
(c) Other
The Company has entered into a sub-lease agreement on normal commercial terms with Azure Minerals Limited, a company of which
Dr Martinick and Mr Rovira are directors. During the year the Company paid sub-lease fees totalling $4,800 (2018: $4,800).
(d) Loans to/from Key Management Personnel
There were no loans outstanding to or from key management personnel as at 30 June 2019 (2018: Nil) other than as set out in
(e) below.
(e) Other transactions and balances with Key Management Personnel
On 23 April 2018 the Company drew-down $100,000 on a short-term bridging facility entered into on 20 April 2018 with Inkjar Pty Ltd
an entity associated with Dr Bradford Farrell (“Facility”), a director of the Company at the time. During the period the Company repaid
this $100,000 plus $3,420 of accumulated interest.
During the year directors received shares to the value of $12,600 (2018: $8,634) in lieu of cash fees. This amount was accrued as at
30 June 2018.
Amounts due and unpaid at 30 June 2019 to Key Management Personnel includes consulting fees of $9,034 to Braunelle Trust,
a related party of M J Steffens.
23. FINANCIAL INSTRUMENTS
(a) Financial Risk Management
The Group’s financial instruments comprise receivables, payables and cash.
The Group’s main risks arising from the financial instruments are:
(i)
interest rate risk,
(ii)
liquidity risk,
(iii) credit risk
(iv) foreign currency risk.
43
Notes to the Consolidated Financial Statements
for the year ended 30 June 2019
23. FINANCIAL INSTRUMENTS (CONTINUED)
Risk Exposures and Responses
(i) Interest Rate Risk
Interest rate risk is the risk that changes in interest rates will affect the Group’s income. The objective of interest rate risk management
is to manage and control risk exposures within acceptable parameters, while optimising any return. As the Group has interest bearing
assets, the Group’s income and operating cash flows are exposed to changes in market interest rates. The assets are short term
interest bearing deposits. The Group does not have any policy in place and no financial instruments are employed to mitigate interest
rate risks. At reporting date, the Group had the following financial assets exposed to Australian and Nicaraguan variable interest rate
risk:
Australia
Financial assets
Cash at bank
Nicaragua
Financial assets
Cash at bank
2019
$
2018
$
679,772
315,291
11,381
7,703
The Group has no interest bearing liabilities and is therefore not exposed to interest rate risks.
The following sensitivity analysis is based on the interest rate risk exposures in existence at the end of the reporting period. The 1%
sensitivity is based on reasonable possible change over the financial year using the observed range for the historic 2 years.
At 30 June, if interest rates had moved, as illustrated in the table below, with all variables held constant, post tax profit and equity would have
been affected as follows:
Judgements of reasonably possible
movements:
Post tax profit
Higher/(Lower)
Equity
Higher/(Lower)
CONSOLIDATED
+1% (100 basis points)
-1% (100 basis points)
2019
$
6,912
(6,912)
2018
$
3,320
(3,320)
2019
$
6,912
(6,912)
2018
$
3,320
(3,230)
The movements in profit and equity are due to higher/lower interest costs from variable rate cash balances.
(ii) 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 table below reflects all contractually fixed pay-offs and receivables for settlement, repayments and interest resulting from
recognised financial assets and liabilities. Undiscounted cash flows of financial liabilities are presented.
The Group has no derivative financial instruments.
The remaining contractual maturities of the groups’ financial liabilities are:
6 months or less
6 – 12 months
1 – 5 years
44
2019
$
65,378
-
-
2018
$
368,839
-
-
65,378
368,839
Oro Verde Limited Annual Report 2019 for the year ended 30 June 2019
23. FINANCIAL INSTRUMENTS (CONTINUED)
(ii) Liquidity Risk (continued)
Maturity analysis of financial assets and liability based on management’s expectation.
The risk implied from the values shown in the table below, reflects a balanced view of cash inflows and (outflows). Leasing obligations,
trade payables and other financial liabilities mainly originate from the financing of assets used in our ongoing operations such as
property, plant and equipment and investments in working capital e.g. inventories and trade receivables. These assets are considered
in the Group’s overall liquidity risk.
<6 months
$
6 – 12 months
$
1 – 5 years
$
> 5 years
$
Total
$
Consolidated
Year ended 30 June 2019
Financial assets
Cash & cash equivalents
Trade & other receivables
Financial liabilities
Trade & other payables
Net Maturity
Year ended 30 June 2018
Financial assets
Cash & cash equivalents
Trade & other receivables
Financial liabilities
Trade & other payables
Loan
Net Maturity
(iii) Credit Risk
691,153
28,722
719,875
65,378
654,497
322,994
12,639
335,633
268,839
100,000
368,839
(33,206)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
691,153
28,722
719,875
65,378
654,497
322,994
12,639
335,633
268,839
100,000
368,839
(33,206)
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 transactions with customers and investments.
The Group’s exposure to credit risk arises from potential default of the counter party, with a maximum exposure equal to the carrying
amount of the financial assets of the Group, which comprises of cash and cash equivalents, trade and other receivables and available
for sale financial assets.
The Group does not hold any credit derivatives to offset its exposure.
The Group trades only with recognised, creditworthy third parties, and as such collateral is not requested nor is it the Group’s policy
to securitise its trade and other receivables.
It is the Group’s policy that all customers who wish to trade on credit terms are subject to credit verification procedures. Receivable
balances are monitored on an ongoing basis with the result that the Group’s exposure to bad debts is not significant.
The Group places its cash deposits with institutions with a credit rating of AA or better and only with major banks.
45
Notes to the Consolidated Financial Statements
for the year ended 30 June 2019
23. FINANCIAL INSTRUMENTS (CONTINUED)
(iii) Credit Risk (continued)
Fair value
The fair values of financial assets and liabilities approximate their carrying amounts shown in the statement of financial position due
to their short term nature. The carrying amounts of financial assets and liabilities as described in the statement of financial position
are as follows:
Consolidated
Carrying Amount
Aggregate Net Fair Value
Financial Asset
Cash
Receivables
Total financial assets
Financial Liabilities
2019
$
691,153
28,722
719,875
2018
$
322,994
12,639
335,633
2019
$
691,153
28,722
719,875
2018
$
322,994
12,639
335,633
Trade creditors and accruals and other creditors
Total financial liabilities
65,378
65,378
368,839
368,839
65,378
65,378
368,839
368,839
The following methods and assumptions are used to determine the net fair values of financial assets and liabilities:
Cash and cash equivalent: The carrying amount approximates fair value because of their short-term to maturity.
Receivables and payables: The carrying amount approximates fair value.
(iv) Foreign Currency Risk
Foreign currency risk is the risk that changes in foreign exchange rates will affect the Group’s income or the value of its holdings
of financial instruments. The Group is exposed to currency risk on purchases that are denominated in a currency other than the
respective functional currencies of Group entities, primarily the United Sates Dollar (USD) and Nicaragua Cordoba (Nic). The currencies
in which the transactions primarily are denominated are USD and Nic.
The Group has not entered into any derivative financial instruments to hedge such transactions and anticipated future receipts or
payments that are denominated in a foreign currency.
Group’s investments in its subsidiaries are not hedged as those currency positions are considered to be long term in nature.
Exposure to currency risk
The Group’s exposure to foreign currency risk at reporting date, expressed in Australian dollars (AUD), was:
Cash
Trade Receivables
Trade Payables
Gross Statement of Financial Position Exposure
Forward exchange contracts
Net Exposure
The following significant exchange rates applied during the year:
2019 (AUD) Nic
2018 (AUD) Nic
11,381
28,722
(2,011)
38,092
-
38,092
7,703
2,396
(146,383)
(136,284)
-
(136,284)
AUD/Nic
46
Average rate
Reporting date spot rate
2019
23.2
2018
23.9
2019
23.3
2018
23.3
Oro Verde Limited Annual Report 2019 for the year ended 30 June 2019
23. FINANCIAL INSTRUMENTS (CONTINUED)
(iv) Foreign Currency Risk (continued)
Sensitivity analysis
Over the reporting period there have been significant movements in the Australian dollar when compared to other currencies, it is
therefore considered reasonable to review sensitivities base on a 10% movement in the Australian dollar. A 10 percent movement of
the Australian dollar against the Nicaraguan Cordoba at 30 June would have affected equity and loss by the amounts shown below.
This analysis assumes that all other variables, in particular interest rates, remain constant. The analysis was performed on the same
basis for 2018.
30 June 2019
Nicaragua Cordoba
30 June 2018
Nicaragua Cordoba
Equity
$
Profit or loss
$
+/- 1,984
+/- 98,324
-
-
24. PARENT ENTITY FINACIAL INFORMATION
(a) Summary Financial Information
The following information has been extracted from the books and records of the parent and has been prepared in accordance with
Accounting Standards:
Statement Of Financial Position
Assets
Current assets
Non-Current assets
Total assets
Liabilities
Current liabilities
Total liabilities
Equity
Issued capital
Reserves
Share-option
Convertible note equity
Accumulated loses
Total Equity
Statement Of Profit Or Loss And Other Comprehensive Income
Total loss
Total comprehensive loss
2019
$
2018
$
686,449
330,924
-
-
686,449
330,924
63,367
63,367
222,456
222,456
24,503,006
23,157,805
5,326,197
5,038,101
136,403
136,403
(29,342,523)
(28,223,841)
623,083
108,468
(1,118,682)
(1,984,370)
(1,118,682)
(1,984,370)
47
Notes to the Consolidated Financial Statements
for the year ended 30 June 2019
24. PARENT ENTITY FINACIAL INFORMATION (CONTINUED)
(b) Guarantees
Oro Verde Limited has not entered into any guarantees, in the current or previous financial year, in relation to the debts of its subsidiaries.
(c) Contingent liabilities
Oro Verde Limited did not have any contingent liabilities as at 30 June 2019 or 30 June 2018.
(d) Contracted commitments for the acquisition of property, plant or equipment
Oro Verde Limited did not have any commitments for the acquisition of property, plant or equipment.
25. SHARE BASED PAYMENTS
Details of each class of option issues are set out below.
(a) Employee and consultants’ option plan
The establishment of the Oro Verde Option Plan (“Plan”) was approved by shareholders at the 2011 Annual General Meeting. The
plan is designed to provide long-term incentives for employees and certain contractors to deliver long term shareholder returns.
Participation in the plan is at the Board’s discretion and no individual has a contractual right to participate in the plan or to receive
guaranteed benefits. In addition, under the Plan, the Board determines the terms of the options including exercise price, expiry date
and vesting conditions, if any.
Options granted under the plan carry no dividend or voting rights. When exercised, each option is convertible into an ordinary share
of the company with full dividend and voting rights.
No options were issued under the plan in 2019 (2018: Nil) and no options are on issue.
(b) Directors and executive options
During the year no options were issued to senior executives (2018: 47,000,000). Set out below are summaries of options issued to
senior executives.
Grant
Date
Expiry
Date
Exercise
Price
(cents)
27 Nov ‘14
30 Sep ‘19
31 Mar ‘15
30 Sep ‘19
15 Dec ‘17
30 Nov ‘20
Total
5.0
5.0
1.3
Weighted average exercise price
Value per
option
at grant
date
(cents)
0.37
0.28
0.35
Balance at
the start
of the year
Granted
during
the year
Exercised
during
the
year
Lapsed
during the
year
Balance at
end of the
year
Vested and
Exercisable
at end of
the year
5,000,000
2,000,000
47,000,000
54,000,000
$0.0018
5,000,000
5,000,000
2,000,000
2,000,000
25,000,000
22,000,000
22,000,000
25,000,000
29,000,000
29,000,000
$0.013
$0.022
$0.022
The weighted average remaining contractual life of share options outstanding at the end of the period was 1.14 years
(2018: 2.27 years).
48
Oro Verde Limited Annual Report 2019 for the year ended 30 June 2019
25. SHARE BASED PAYMENTS (CONTINUED)
Fair value of director options granted
No options were issued during the year. During the 2018 financial year the weighted average fair value of the options granted was 1.58
cents. The price was calculated by using the Binominal Option valuation methodology applying the following inputs:
Weighted average exercise price (cents)
Weighted average life of the option (years)
Weighted average underlying share price (cents)
Expected share price volatility (%)
Risk free interest rate (%)
2018
1.3
2.9
0.7
100
1.93
Total expenses arising from share-based payment transactions to executives in their capacity as executives recognised during the
period were as follows:
Options issued to executives
(c) Performance Share Rights
Consolidated
2019
$
-
2018
$
228,000
On 13 August 2018 the Company issued 50,000,000 Performance Rights to 1620 Capital Pty Ltd in consideration for corporate advisory
services. The vesting conditions for the Performance Rights are as follows:
• 15 million performance shares which vest if the 10 Day volume weighted average price (“VWAP”) of the Company shares exceed
$0.01 per share;
• 15 million performance shares which vest if the 10 Day volume weighted average price (“VWAP”) of the Company shares exceed
$0.015 per share; and
• 20 million performance shares which vest if the 10 Day volume weighted average price (“VWAP”) of the Company shares exceed
$0.02 per share
The Performance Rights were issued for nil cash consideration and no consideration will be payable upon vesting of the Performance
Rights. Upon satisfaction of the vesting conditions, each Performance Right will automatically vest into one fully paid ordinary share
of the Company. The Performance Rights will lapse on 13 August 2020.
As at 30 June 2019 and the date of this report no performance share has vested.
49
Notes to the Consolidated Financial Statements
for the year ended 30 June 2019
25. SHARE BASED PAYMENTS (CONTINUED)
Fair value of performance rights granted
As these performance share rights vest at different times and at different prices they were valued using a hybrid up and in single share
price barrier model and incorporates a trinomial option valuation. The following inputs have been applied in the valuation.
Item
Underlying security spot price
Number of Rights
Exercise price
Valuation date
Expiry date
Life of the Rights (years)
Share price barrier
Parisian adjusted barrier
Dividend yield
Volatility
Risk-free rate
This yields the following valuations
Value per Right
Value per tranche
Tranche A
$0.007
15,000,000
Nil
1 Aug 2018
31 Jul 2020
2
0.010
0.013
0.00%
125%
2.05%
$0.006
95,438
Tranche B
$0.007
15,000,000
Nil
1 Aug 2018
31 Jul 2020
2
0.015
0.019
0.00%
125%
2.05%
$0.006
86,681
Tranche C
$0.007
20,000,000
Nil
1 Aug 2018
31 Jul 2020
2
0.020
0.026
0.00%
125%
2.05%
$0.005
105,977
Total expenses arising from the issue of performance share rights recognised during the period were as follows:
Performance Share Rights issued
Consolidated
2019
$
288,096
2018
$
-
50
Oro Verde Limited Annual Report 2019 for the year ended 30 June 2019
Independent Auditor’s Report
51
Independent Auditor’s Report (Continued)
52
Oro Verde Limited Annual Report 2019 53
Corporate Governance Statement
30 June 2019
Approach to Corporate Governance
Oro Verde Limited ACN 083 646 477 (Company) has established a corporate governance framework, the key features of which are set
out in this statement. In establishing its corporate governance framework, the Company has referred to the recommendations set
out in the ASX Corporate Governance Council’s Corporate Governance Principles and Recommendations 3rd edition. The Company
has followed each recommendation where the Board has considered the recommendation to be an appropriate benchmark for its
corporate governance practices. Where the Company’s corporate governance practices follow a recommendation, the Board has
made appropriate statements reporting on the adoption of the recommendation. In compliance with the “if not, why not” reporting
regime where, after due consideration, the Company’s corporate governance practices do not follow a recommendation, the Board
has explained it reasons for not following the recommendation and disclosed what, if any, alternative practices the Company has
adopted instead of those in the recommendation. The following governance-related documents can be found on the Company’s
website at http://www.oroverde.com.au/index.php/governance:
Charters
• Board
• Audit and Risk Committee
• Nomination Committee
• Remuneration Committee
Policies and procedures
• Policy and Procedure for the Selection and (Re)Appointment of Directors
• Process for Performance Evaluations
•
Securities Trading Policy
• Code of Conduct (summary)
• Diversity Policy (summary)
• Continuous Disclosure Policy (summary)
• Continuous Disclosure Compliance Procedures (summary)
•
Shareholder Communication and Investor Relations Policy
The Company reports below on whether it has followed each of the recommendations during the Reporting Period. This statement
was approved by a resolution of the Board on, and the information in this statement is current as at, 24 September 2019.
Principle 1: Lay solid foundations for management and oversight
Recommendation 1.1
The Company has established the respective roles and responsibilities of its Board and management, and those matters expressly
reserved to the Board and those delegated to management and has documented this in its Board Charter, which is disclosed on the
Company’s website.
Recommendation 1.2
The Company undertakes appropriate checks before appointing a person or putting forward to shareholders a candidate for election
as a director and provides shareholders with all material information in its possession relevant to a decision on whether or not to elect
or re-elect a director. The checks which are undertaken, and the information provided to shareholders are set out in the Company’s
Policy and Procedure for the Selection and (Re)Appointment of Directors, which is disclosed on the Company’s website.
The Company appointed Dr. Marc Steffens to the board on 30 November 2018, and the checks referred to in the Company’s policies
and Procedures for the selection and (Re)Appointment of Directors were undertaken.
The Company provided shareholders with all material information in relation to the re-election of Mr Brett Dickson at its 2018 Annual
General Meeting.
Recommendation 1.3
The Company has a written agreement with each director and senior executive setting out the terms of their appointment.
The material terms of any employment, service or consultancy agreement the Company, or any of its child entities, has entered into
with its Managing Director, any of its directors, and any other person or entity who is related party of the Managing Director or any of
its directors has been disclosed in accordance with ASX Listing Rule 3.16.4 (taking into consideration the exclusions from disclosure
outlined in that rule).
Recommendation 1.4
The Company Secretary is accountable directly to the Board, through the Chair, on all matters to do with the proper functioning of
the Board.
54
Oro Verde Limited Annual Report 2019 30 June 2019
Recommendation 1.5
The Company has a Diversity Policy, a summary of which is disclosed on the Company’s website. However, the Diversity Policy does
not include requirements for the Board to set measurable objectives for achieving gender diversity and to assess annually both the
objectives and the Company’s progress in achieving them. Nor has the Board set measurable objectives for achieving gender diversity.
Given the Company’s stage of development as an exploration company, the number of employees in Australia and the nature of the
labour market in Nicaragua, the Board considers that it is not practical to set measurable objectives for achieving gender diversity.
The respective proportions of men and women on the Board, in senior executive positions and across the whole organisation are set
out in the following table. “Senior executive” for these purposes means a person who makes, or participates in the making of, decisions
that affect the whole or a substantial part of the business or has the capacity to affect significantly the Company’s financial standing.
During the Reporting Period, this included the Finance Director & Company Secretary:
Whole organisation (including the Board)
Senior executive positions
Board
Recommendation 1.6
Proportion of women
0 out of 4 (0%)
0 out of 2 (0%)
0 out of 4 (0%)
The Chair is responsible for evaluation of the Board and, when deemed appropriate, Board committees and individual directors in
accordance with the process disclosed in the Company’s Process for Performance Evaluations.
During the Reporting Period, an evaluation of the Board, its committees and individual directors took place in accordance with the
process disclosed in the Company’s Process for Performance Evaluations.
The Chairperson’s performance is evaluated by the other members of the Board in accordance with the process disclosed in the
Company’s Process for Performance Evaluations.
During the Reporting Period, an evaluation of the Chairperson took place in accordance with the process disclosed in the Company’s
Process for Performance Evaluations.
Recommendation 1.7
The Managing Director is responsible for evaluating the performance of senior executives in accordance with the process disclosed in
the Company’s Process for Performance Evaluations.
The Chairman is responsible for evaluating the Managing Director in accordance with the process disclosed in the Company’s Process
for Performance Evaluations. The Company did not have an appointed Managing Director during the reporting period.
During the Reporting Period, an evaluation of the Company’s sole senior executive (the Finance Director & Company Secretary) took
place in accordance with the process disclosed in the Company’s Process for Performance Evaluations.
Principle 2: Structure the board to add value
Recommendation 2.1
The Board has not established a separate Nomination Committee. The Board believes that there would be no efficiencies or other
benefits gained by establishing a separate Nomination Committee. Accordingly, the Board performs the role of the Nomination
Committee. Although the Board has not established a separate Nomination Committee, it has adopted a Nomination Committee
Charter which describes the role, composition, functions and responsibilities of the full Board in its capacity as the Nomination
Committee. The Company’s Nomination Committee Charter is disclosed on the Company’s website.
The Board carries out those functions which are delegated to it in the Company’s Nomination Committee Charter. When matters that
are within the responsibility of the full Board in its capacity as the Nomination Committee are considered, they are marked as separate
agenda items at Board meetings. The Board deals with any conflicts of interest that may occur when nomination related matters are
considered by ensuring that the director with conflicting interests is not party to the relevant discussions.
Recommendation 2.2
The mix of skills and diversity for which the Board is looking to achieve in membership of the Board is represented by the Board’s
current composition, which includes extensive geological experience and qualifications, experience in mineral processing, experience
in operating in locations outside of Australia, accounting qualifications and financial management skills, leadership, governance and
strategy.
While the Company is at exploration stage, it does not wish to increase the size of the Board, and considers that the Board weighted
towards technical experience is appropriate at this stage of the Company’s development. External consultants may be brought in with
specialist knowledge to address areas where this is an attribute deficiency in the Board.
55
Corporate Governance Statement
30 June 2019
Principle 2: Structure the board to add value (continued)
Recommendation 2.3
The Board considers the independence of directors having regard to the relationships listed in Box 2.3 of the Principles &
Recommendations.
Details of the Board of directors, their appointment date, length of service and independence status is as follows:
Director’s name
Appointment date
Length of service
at 30/06/2019
Independence status
M J Steffens
Executive Director
A P Rovira
Non-executive Director
B D Dickson
Finance Director
Recommendation 2.4
30 November 2018
7 months
Independent
21 November 2014
4 years 7 months
Independent
21 November 2014
4 years 7 months
Not independent
The Board has a majority of directors who are independent. The Board does not wish to increase its size at present, and considers that
the current composition of the Board is adequate for the Company’s current size and operations, and includes an appropriate mix of
skills and expertise relevant to the Company’s business.
Recommendation 2.5
The Chair is rotated at each meeting between the independent directors. The Board currently considers that the rotation of the Chair
between the Independent directors is appropriate until a permnanent Chair is appointed.
Recommendation 2.6
The Company has an induction program that it uses to when new directors join the Board and when new senior executives are
appointed. The goal of the program is to assist new directors to participate fully and actively in Board decision-making at the earliest
opportunity and to assist senior executives to participate fully and actively in management decision-making at the earliest opportunity.
The full Board in its capacity as the Nomination Committee regularly reviews whether the directors as a group have the skills,
knowledge and familiarity with the Company and its operating environment required to fulfil their role on the Board and the Board
committees effectively using a Board skills matrix. Where any gaps are identified, the full Board in its capacity as the Nomination
Committee considers what training or development should be undertaken to fill those gaps. In particular, the full Board in its capacity
as the Nomination Committee ensures that any director who does not have specialist accounting skills or knowledge has a sufficient
understanding of accounting matters to fulfil his or her responsibilities in relation to the Company’s financial statements.
Principle 3: Act ethically and responsibly
Recommendation 3.1
The Company has established a Code of Conduct for its directors, senior executives and employees, a summary of which is disclosed
on the Company’s website.
The Company has also adopted a Whistleblower Policy to encourage the raising of any concerns or reporting of instances of any
violations (or suspected violations) of the Code of Conduct (or any potential breach of law or any other legal or ethical concern) without
the fear of intimidation or reprisal.
Principle 4: Safeguard integrity in corporate reporting
Recommendation 4.1
The Board has not established a separate Audit and Risk Committee. The Board believes that there would be no efficiencies or other
benefits gained by establishing a separate Audit and Risk Committee. Accordingly, the Board performs the role of the Audit and Risk
Committee. Although the Board has not established a separate Audit and Risk Committee, it has adopted an Audit and Risk Committee
Charter which describes the role, composition, functions and responsibilities of the full Board in its capacity as the Audit and Risk
Committee. The Company’s Audit and Risk Committee Charter is disclosed on the Company’s website.
The Board carries out those functions which are delegated to it in the Company’s Audit and Risk Committee Charter. When matters
that are within the responsibility of the full Board in its capacity as the Audit and Risk Committee are considered, they are marked as
separate agenda items at Board meetings. The Board deals with any conflicts of interest that may occur when audit or risk related
matters are considered by ensuring that the director with conflicting interests is not party to the relevant discussions.
56
Oro Verde Limited Annual Report 2019 Recommendation 4.1 (continued)
The Company has also established a Procedure for the Selection, Appointment and Rotation of its External Auditor, which is an appendix
to its Audit and Risk Committee Charter disclosed on the Company’s website. The Board is responsible for the initial appointment
of the external auditor and the appointment of a new external auditor when any vacancy arises, as recommended by the Audit and
Risk Committee (or its equivalent). Candidates for the position of external auditor must demonstrate complete independence from
the Company through the engagement period. The Board may otherwise select an external auditor based on criteria relevant to the
Company’s business and circumstances. The performance of the external auditor is reviewed on an annual basis by the Audit and Risk
Committee (or its equivalent) and any recommendations are made to the Board.
Recommendation 4.2
Before the Board approved the Company financial statements for the half year ended 31 December 2018 and the full-year ended 30
June 2019, it received from the Finance Director a declaration that, in his opinion, the financial records of the Company for the relevant
financial period have been properly maintained and that the financial statements for the relevant financial period comply with the
appropriate accounting standards and give a true and fair view of the financial position and performance of the Company and the
consolidated entity and that the opinion has been formed on the basis of a sound system of risk management and internal control
which is operating effectively (Declaration).
The Board did not receive a Declaration for each of the quarters ending 30 September 2018, 31 December 2018, 31 March 2019
and 30 June 2019 because in the Board’s view its quarterly reports are not financial statements to which the Declaration can be
appropriately given.
Recommendation 4.3
Under section 250RA of the Corporations Act, the Company’s auditor is required to attend the Company’s annual general meeting
at which the audit report is considered, and the auditor must arrange to be represented by a person who is a suitably qualified
member of the audit team that conducted the audit and is in a position to answer questions about the audit. Each year, the Company
informs its auditor of the date of the Company’s annual general meeting. In accordance with section 250S of the Corporations Act,
at the Company’s annual general meeting where the Company’s auditor or their representative is at the meeting, the Chair allows a
reasonable opportunity for the members as a whole at the meeting to ask the auditor (or its representative) questions relevant to the
conduct of the audit; the preparation and content of the auditor’s report; the accounting policies adopted by the Company in relation
to the preparation of the financial statements; and the independence of the auditor in relation to the conduct of the audit. The Chair
also allows a reasonable opportunity for the auditor (or their representative) to answer written questions submitted to the auditor
under section 250PA of the Corporations Act.
A representative of the Company’s auditor, BDO Audit (WA) Pty Ltd attended the Company’s annual general meeting held on 30
November 2018.
Principle 5: Make timely and balanced disclosure
Recommendation 5.1
The Company has established written policies and procedures for complying with its continuous disclosure obligations under the
ASX Listing Rules. A summary of the Company’s Continuous Disclosure Policy and Continuous Disclosure Compliance Procedures are
disclosed on the Company’s website.
Principle 6: Respect the rights of security holders
Recommendation 6.1
The Company provides information about itself and its governance to investors on its website at www.oroverde.com.au.
Recommendation 6.2
The Company has designed and implemented an investor relations program to facilitate effective two-way communication with
investors. The program is set out in the Company’s Shareholder Communication and Investor Relations Policy, which is disclosed on
the Company’s website.
Recommendation 6.3
The Company has in place a Shareholder Communication and Investor Relations Policy (disclosed on the Company’s website) which
outlines the policies and processes that it has in place to facilitate and encourage participation at meetings of shareholders.
Recommendation 6.4
The Company engages its share registry to manage the majority of communications with shareholders. Shareholders are encouraged
to receive correspondence from the company electronically, thereby facilitating a more effective, efficient and environmentally
friendly communication mechanism with shareholders. Shareholders not already receiving information electronically can elect to do
so through the share registry, Computershare Registry Services Pty Ltd www.computershare.com.
57
Corporate Governance Statement
30 June 2019
Principle 7: Recognise and manage risk
Recommendation 7.1
The Board has not established a separate Audit and Risk Committee. The Board performs the role of the Audit and Risk Committee.
Please refer to the disclosure above in relation to Recommendation 4.1.
Recommendation 7.2
The full Board in its capacity as the Audit and Risk Committee reviews the Company’s risk management framework annually to satisfy
itself that it continues to be sound, to determine whether there have been any changes in the material business risks the Company
faces and to ensure that the Company is operating within the risk appetite set by the Board. The Board carried out these reviews
during the Reporting Period.
Recommendation 7.3
The Company does not have an internal audit function. To evaluate and continually improve the effectiveness of the Company’s risk
management and internal control processes, the Board relies on ongoing reporting and discussion of the management of material
business risks as outlined in the Company’s Risk Management Policy.
Recommendation 7.4
As the Company is not in production, the Company has not identified any material exposure to any environmental and/or social
sustainability risks. However, the Company does have a material exposure to the following economic risks:
i. Market risk – movements in commodity prices. The Company manages its exposure to market risk by monitoring market
conditions, and making decisions based on industry experience.
ii.
Future capital risk – cost and availability of funds to meet the Company’s business requirements. The Company manages
this risk by maintaining adequate reserves by continuously monitoring forecast and actual cash flows.
Principle 8: Remunerate fairly and responsibly
Recommendation 8.1
The Board has not established a separate Remuneration Committee. The Board believes that there would be no efficiencies or other
benefits gained by establishing a separate Remuneration Committee. Accordingly, the Board performs the role of the Remuneration
Committee. Although the Board has not established a separate Remuneration Committee, it has adopted a Remuneration Committee
Charter which describes the role, composition, functions and responsibilities of the full Board in its capacity as the Remuneration
Committee. The Company’s Remuneration Committee Charter is disclosed on the Company’s website.
The Board carries out those functions which are delegated to it in the Company’s Remuneration Committee Charter. When matters
that are within the responsibility of the full Board in its capacity as the Remuneration Committee are considered, they are marked as
separate agenda items at Board meetings. The Board deals with any conflicts of interest that may occur when remuneration related
matters are considered by ensuring that the director with conflicting interests is not party to the relevant discussions.
Recommendation 8.2
Details of remuneration, including the Company’s policy on remuneration, are contained in the “Remuneration Report” which forms of
part of the Directors’ Report and commences at page 10. The Company has not adopted a policy regarding the deferral of performance-
based remuneration and the reduction, cancellation or clawback of the performance-based remuneration in the event of serious
misconduct or a material misstatement in the Company’s financial statements as other punitive measures, including dismissal, are
available to be utilised by the Company.
Recommendation 8.3
The Company’s Securities Trading Policy includes a statement of the Company’s policy on prohibiting executives and directors from
entering into transactions which limit the economic risk of participating in any equity based remuneration scheme.
58
Oro Verde Limited Annual Report 2019 30 June 2019
Additional ASX Information
Additional information required by the Australian Securities Exchange Ltd and not disclosed elsewhere in this report is as follows. The
information is current as at 7 September 2018.
(a) Statement of shareholdings
Range
Names of 20 largest shareholders
Ordinary Shares
Fully paid
No of holders
No. of shares held
% held
100,001or more
Mr Bilal Ahmad
Mr Sufian Ahmad
MGL Corp Pty Ltd
Mr Bin Lie
Suparell Pty Ltd
Mr Anthony Paul Rovira
Martinick Investments Pty Ltd
Reco Holdings Pty Ltd
DDPEVCIC (WA) Pty Ltd
Upsky Equity Pty Ltd
Dr Wolf Gerhard Martinick
Diab Investments Pty Ltd
Berenes Nominees
Mr BD & GF Dickson
Inkjar Pty Ltd
Davy Corp Pty Ltd
Shordean Pty Ltd
1620 Capital Pty Ltd
Mr Garry Temple
Compusure Superannuation
Various
Sub-total
10,001 - 100,000
Various
5,001 – 10,000
1,001 – 5000
1 – 1,000
Total
Various
Various
Various
Holding an unmarketable parcel
The Company has the following unquoted options on issue.
30 September 2019, 5 cent options
30 November 2020, 1.3 cent options
31 July 2021, .075 cent options
100,000,000
96,666,640
70,000,000
60,348,583
55,315,872
50,342,016
43,087,761
37,600,000
33,333,360
32,000,000
31,094,914
30,000,000
23,875,000
22,375,000
21,768,868
20,000,000
17,984,497
14,500,000
11,010,000
11,000,000
782,302,511
734,055,013
37,963,780
701,770
543,791
111,668
20
880
679
91
216
256
2,142
1,242
1,555,678,533
39,321,009
6.43
6.21
4.50
3.88
3.56
3.24
2.77
2.42
2.14
2.06
2.00
1.93
1.53
1.44
1.40
1.29
1.16
0.93
0.71
0.71
50.31
47.16
2.44
0.05
0.03
0.01
100.00
2.53
Number of options
73,000,000
47,000,000
340,000,000
59
Additional ASX Information
Restricted Securities
There are no restricted securities.
(b) Voting Rights
All ordinary shares carry one vote per share without restriction.
c) Substantial Shareholders
As at 7 September 2018, shareholders who have notified the company in accordance with section 671B of the Corporations Act 2001.
Beneficial Owner
JGM Property Investments Pty Ltd
Sulfian Ahmad
Bilal Ahmad
Schedule of Mining Tenements Held
No. of Shares
133,000,000
100,666,640
100,000,000
Project
Hemco –SID
Common Name
Type of Concession
Concession No.
Percentage Held
San Isidro
Exploration
1351
100%
60
Oro Verde Limited Annual Report 2019 Level 1, 34 Colin Street
West Perth WA 6005
Australia
Telephone: +61 (0) 8 9481 2555
Facsimile: +61 (0) 8 9485 1290
Email: info@oroverde.com.au
www.oroverde.com.au