ANNUAL REPORT 2015
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ANNUAL REPORT 2015
Contents
CORPORATE INFORMATION .........................................................................................................5
CHAIRMAN’S REPORT ....................................................................................................................6
DIRECTORS’ REPORT ......................................................................................................................7
AUDITOR’S INDEPENDENCE DECLARATION .............................................................................31
INTEREST IN TENEMENTS .............................................................................................................32
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME ...............................................33
CONSOLIDATED STATEMENT OF FINANCIAL POSITION .........................................................34
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY ..........................................................35
CONSOLIDATED STATEMENT OF CASH FLOWS .......................................................................36
NOTES TO THE FINANCIAL STATEMENTS ..................................................................................37
DIRECTORS’ DECLARATION ..........................................................................................................64
INDEPENDENT AUDITOR’S REPORT ............................................................................................65
ANNUAL REPORT 2015
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Corporate Information
DIRECTORS
BANKERS
Macquarie Bank Ltd (Brisbane Branch)
345 Queen Street, Brisbane QLD 4000
Australia
UK SOLICITORS
Locke Lord LLP
201 Bishopsgate,
London EC2M 3AB,
United Kingdom
AUSTRALIAN SOLICITORS
Hopgood Ganim
Level 8, Waterfront Place
1 Eagle Street,
Brisbane QLD 4000, Australia
REGISTRAR
Computershare Investor Services plc
The Pavilions, Bridgwater Road
Bristol BS99 7NH
United Kingdom
Nicholas Mather
Vincent Mascolo
Geoffrey (Stuart) Crow
Neil Herbert – appointed 12 Feb 2015
Bastiaan Van Aswegen – appointed 12 Feb 2015
Alistair McAdam – appointed 12 Feb 2015
Tsuyoshi Ueda – appointed 26 May 2015
COMPANY SECRETARY
Karl Schlobohm
REGISTERED OFFICE
Level 27, 111 Eagle St
Brisbane QLD 4000
Phone: + 61 7 3303 0610
Fax: +61 7 3303 0681
Email: info@ironridgeresources.com.au
Web Site: www.ironridgeresources.com.au
AUDITOR
BDO Audit Pty Ltd
Level 10, 12 Creek Street
Brisbane QLD 4000
Australia
NOMINATED ADVISOR
SP Angel Corporate Finance LLP
Prince Frederick House
35-39 Maddox Street
London W1S 2PP
United Kingdom
BROKER
SP Angel Corporate Finance LLP
Prince Frederick House
35-39 Maddox Street
London W1S 2PP
United Kingdom
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ANNUAL REPORT 2015
Chairman’s Report
Dear Shareholder,
On behalf of the Board of Directors it is with great pleasure that I take this opportunity to report
the progress achieved by IronRidge Resources Ltd (“IronRidge”) over the past twelve months,
and on the advancements made in the last six months since listing on the Alternative Investment
Market (“AIM”) in London.
IronRidge is an emerging regional iron ore explorer with two provincial sized projects in Gabon,
Africa, and a promising titanium and bauxite project in Queensland, Australia. IronRidge made
its AIM debut on 12 February 2015, following the raising of approximately £9.7 million. The capital
was largely subscribed by international companies Assore Limited of South Africa, and Sumitomo
Corporation of Japan. Assore is a high-grade iron, chrome and manganese mining specialist, and
holds approximately 30% of IronRidge. Sumitomo is a global resources, mining, marketing and
trading conglomerate holding approximately 12% of IronRidge. With ASX-listed DGR Global Ltd
also holding approximately 26% of IronRidge, the share capital of the Company is tightly held.
The exploration program in Gabon is currently underway, and is being spearheaded by SRK
Exploration Services (“SRK ES”) and supervised by IronRidge’s new Gabonese Country Manager,
Mr Len Kolff. SRK ES is a one of the world’s leading exploration consultancy firms specialising
in early stage exploration, and is providing a bespoke service, which combines its exploration
expertise and in-country knowledge with renowned global experience and resources. SRK ES
is lead by expatriate principals and has had an established office in Libreville Gabon since 2014
facilitating central operations and government liaison. News from the exploration program is
expected over the next 12 months.
Shareholders will be well aware of the current challenges being faced by junior exploration
companies around the world, particularly those involved in iron ore projects, given the 70%
decline in the price of iron ore suffered since 2013. Accordingly, the Company may seek to
complement its existing project portfolio over the ensuing twelve months to provide some level
of diversification and commodity cycle hedge within its asset base. Such a strategy would also
enable IronRidge to leverage the expertise and fire-power currently represented at executive,
Board and shareholder level. The prudent management of IronRidge’s working capital has left it
reasonably well placed to take advantage of complementary opportunities as they arise.
I would like to take this opportunity to acknowledge and thank IronRidge’s CEO, Mr Vincent
Mascolo, for his tireless efforts in having the Company listed this year, notwithstanding the
considerable equity market and commodity price challenges involved, and in having the
exploration program underway in Gabon. I would also like to thank my fellow Board members
and the shareholders of the Company for their ongoing support. I look forward to bringing you
news of the Company’s progress over the course of the next year.
Yours sincerely
Nicholas Mather
Executive Chairman
ANNUAL REPORT 2015
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Directors’ Report
Your directors submit their report for the year
ended 30 June 2015.
• Navaho Gold Limited, which is listed on the
ASX
DIRECTORS
The names and details of the Company’s directors
in office during the financial year and until the date
of this report are as follows. Directors were in office
for this entire period unless otherwise stated.
Nicholas Mather
Vincent Mascolo
Geoffrey (Stuart) Crow
Neil Herbert – appointed 12 February 2015
Bastiaan Van Aswegen – appointed 12 February 2015
Alistair McAdam – appointed 12 February 2015
Tsuyoshi Ueda – appointed 26 May 2015
Christelle Van der Merwe (alternate for Bastiaan Van
Aswegen) – appointed 12 February 2015
Frans Olivier (alternate for Alistair McAdam) –
appointed 12 February 2015
Kenichiro Tsubaki (alternate for Tsuyoshi Ueda) –
appointed 26 May 2015
Nicholas Mather
Executive Chairman
BSc (Hons, Geology), MAusIMM
Mr Mather’s special area of experience and
expertise is the generation of and entry into
undervalued or unrecognised resource exploration
opportunities. He has been involved in the junior
resource sector at all levels for more than 25
years. In that time he has been instrumental in
the delivery of major resource projects that have
delivered significant gains to shareholders. As an
investor, securing projects and financiers, leading
exploration campaigns and managing emerging
resource companies Mr Mather brings a wealth of
valuable experience.
During the past three years Mr Mather has
also served as a director of the following listed
companies:
• DGR Global Limited, which is listed on the
Australian Securities Exchange (ASX)
• Orbis Gold Limited (resigned 16 February 2015),
which was listed on the ASX
• Aus Tin Mining Limited, which is listed on the
ASX
• Bow Energy Limited (resigned 11 January 2012),
which was listed on the ASX
• Armour Energy Limited, which is listed on the
ASX
• Lakes Oil NL (appointed 7 February 2012),
which is listed on the ASX
• SolGold plc, which is listed on the London
Stock Exchange (AIM)
Vincent Mascolo
Managing Director
and Chief Executive Officer
BEng Mining, MAusIMM, MEI Aust
Mr Mascolo is a qualified mining engineer with
extensive experience in a variety of fields including,
gold and coal mining, quarrying, civil-works,
bridge-works, water and sewage treatment and
estimating.
Mr Mascolo has completed his assignment in
the Civil and Construction Industry, including
construction and project management,
engineering, quality control and environment and
safety management. He is also a member of both
the Australian Institute of Mining and Metallurgy
and the Institute of Engineers of Australia.
During the past three years Mr Mascolo has
also served as a director of the following listed
company:
•
➢DGR Global Limited, which is listed on
the ASX
Stuart Crow
Non-Executive Director
Mr Crow has more than 27 years’ experience
in all aspects of corporate finance and investor
relations in Australia and international markets,
and has owned and operated his own businesses
in these areas for the last nineteen years. He brings
extensive working knowledge of global capital
markets and investor relations to the Board.
Throughout his career, Stuart has served on a
number of boards of public and unlisted companies
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ANNUAL REPORT 2015
and has assisted in raising funds for companies of
varying size in Australia and International capital
markets whilst working for his own firm and before
that some of the world’s largest broking firms.
During the past three years Mr Crow has also served
as a director of the following listed company:
• TNG Limited, which is listed on the ASX
Neil Herbert
Non-Executive Director
Mr. Herbert is a Fellow of the Association of
Chartered Certified Accountants and has over 23
years of experience in finance. Mr. Herbert has
been involved in growing mining and oil and gas
companies, both as an executive and an investment
manager, for over 16 years and, until May 2013,
was co-chairman and managing director of AIM
quoted Polo Resources Limited, a natural resources
investment company. Prior to this, he was a director
of resource investment company Galahad Gold plc
from which he became finance director of its most
successful investment, start-up uranium company
UraMin Inc. from 2005 to 2007, during which period
he worked to float the company on AIM and the
Toronto Stock Exchange in 2006, raise c.US$400
million in equity financing and negotiate the sale
of the group for US$2.5 billion. Mr Herbert has
also held board positions at a number of resource
companies where he has been involved in managing
numerous acquisitions, disposals, stock market
listings and fundraisings. Mr Herbert holds a joint
honours degree in economics and economic history
from the University of Leicester.
Bastiaan Hendrikus van Aswegen
Non-Executive Director
Mr. van Aswegen is a Member of the Southern
African Institute of Mining and Metallurgy and is a
consulting metallurgist for the Assore group. Mr.
van Aswegen has 28 years’ experience working
in the mining and ferro-alloy production industry.
After working for Iscor Ltd and Samancor Ltd in
production and on projects, he was appointed by
Samancor Ltd as general manager of the Palmiet
Ferrochrome Operation (Mogale) in 1999. Mr. van
Aswegen joined Assore in 2003 and in September
2012 he was appointed group technical and
operations director of Assore.
Alistair McAdam
Non-Executive Director
Mr. McAdam is a Member of the Institute of
Materials, Minerals and Mining and is a chartered
engineer. Mr. McAdam has over 20 years’
experience in platinum and gold production and
project evaluation. Mr. McAdam held the position
of sales manager at Johannesburg Consolidated
Investment Company Ltd Group until his division
was sold to Sudelektra South Africa Holdings (Pty)
Ltd and subsequently to Xstrata and Glencore. Mr.
McAdam joined Ore & Metal Company Limited in
2000 and was appointed as the group manager of
new business in August 2013.
Mr Tsuyoshi Ueda
Non-Executive Director
Mr Ueda joins the Board as part of the Company’s
strategic alliance with Sumitomo Corporation and
brings to IronRidge a wealth of expertise in the
strategic development, marketing, operational
and corporate development of the Company’s
Gabonese iron ore assets. Mr Ueda is currently
the Deputy General Manager of Sumitomo’s Iron
& Steel Making Raw Materials Department. Prior
to this appointment Mr Ueda was the General
Manager for Sumitomo’s Africa Division for Mineral
Resources and Steel Products.
Christelle Van der Merwe
Alternate Director
BSc (Hons, Geology), BSc (Environmental Management),
MAP79 B.Arch
Ms Van der Merwe is a mining geologist responsible
for the mining-related geology and resources of
the Assore Subsidiary Companies (comprising
the pyrophyllite and chromite mines), and is also
concerned with the company’s iron and manganese
mines. She has been the Assore group geologist
since 2013 and involved with strategic
and resource investment decisions of the company.
Ms Van der Merwe is a member of SACNASP
and the GSSA.
ANNUAL REPORT 2015
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Directors’ Report
Frans Olivier
Alternate Director
BEng (Mining), MCom (Business
Management), GDE (Mining), SAIMM
COMPANY SECRETARY
Karl Schlobohm
Company Secretary
B.Comm, B.Econ, M.Tax, CA, AICD
Karl Schlobohm is a Chartered Accountant with over
20 years’ experience across a wide range of industries
and businesses. He has extensive experience with
financial accounting, corporate governance, company
secretarial duties and board reporting. Previously Mr
Schlobohm has contracted into roles as CFO and/
or Company Secretary for a number of ASX-listed
resource companies including Linc Energy, Discovery
Metals and Meridian Minerals.
He currently acts as the Company Secretary for
ASX-listed DGR Global Limited, Navaho Gold
Limited, Aus Tin Mining Limited, Armour Energy
Limited and LSE (AIM) listed SolGold Plc.
CORPORATE STRUCTURE
IronRidge Resources Limited is a company limited
by shares that is incorporated and domiciled in
Australia. It was converted to a public company on
22 August 2011.
Mr Olivier has extensive mining operations and
management experience gained through General
Mining Corporation, Sasol Coal, Iscor Mining and
Assmang (African Mining and Trust). Mr Olivier
has been responsible for the detailed economic
evaluation of major open pit and underground
mine projects in South Africa, Ghana, Kazakhstan,
Democratic Republic of Congo and Russia.
Kenichiro Tsubaki
Alternate Director
BEcon
Mr. Tsubaki joined Sumitomo Corporation in 1992
and has been involved in iron ore industry for over
20 years including work experiences in India and
South Africa. Mr. Tsubaki is currently manager of
Sumitomo’s Iron & Steel Making Raw Materials
Department.
As at the date of this report, the interest of the
directors in the shares and options of IronRidge
Resources Limited were:
Number of
Ordinary shares
Number of
Options over
Ordinary shares
Nicholas Mather
1,303,703
1,500,000
Vincent Mascolo
8,310,291
3,000,000
Stuart Crow
Neil Herbert
Bastiaan van Aswegen
Alistair McAdam
Tsuyoshi Ueda
1,000,000
1,500,000
-
-
-
-
-
-
-
-
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ANNUAL REPORT 2015
Directors’ Report
PRINCIPAL ACTIVITIES
IronRidge was originally established to explore for
uranium in southern Queensland and over a number
of years the Company accumulated a sizeable
package of Exploration Permits for Minerals (EPM)
and an Exploration Permit for Coal (EPC), focused
mainly in the Surat Basin, in Queensland, Australia.
In late 2011 the Company sought to expand its
strategy of “Early Mover Advantage” into regions of
Africa prospective for iron ore. Following a global
search for a new prospective province, equatorial
West Africa was identified as a compelling
opportunity lying on the extensive Proterozoic
aged iron belt which originally stretched across
the ancient continent of Pangaea from the Pilbara
in Western Australia across India and Africa to the
famous and prolific Carajas iron region in Brazil.
Licenses over vacant project areas were applied
for and subsequently granted over the Tchibanga
and Belinga Sud areas in Gabon. IronRidge
was attracted to the size of the project and
targets, close proximity to the coastal port site of
Mayumba, infrastructure upgrading initiatives by
the progressive Gabonese Government and evident
presence of high grade iron mineralisation up to
62% on the main prospect at Mont Pele.
The Company was admitted to AIM on Thursday,
12 February 2015. The Company successfully
completed a placing (“Placing”) of and the
subscription for 96,538,380 new Ordinary Shares
to raise approximately £9.7 million ($19.2 million).
The total number of shares on issue at Admission
was 236,612,203 giving the Company a market
capitalisation of approximately £23.7 million ($46.9
million) on Admission at the Placing and Investor
Subscription Price of 10p per share. The funds
raised will be used to undertake exploration
mapping, sampling and an approximately 15,000
metre planned drilling programme on the
Company’s exploration projects in Gabon: the
Tchibanga and Tchibanga North license areas, two
adjacent permitted areas located in the Tchibanga
region in the south-west of Gabon, and the Belinga
Sud Prospect, located in the north-east of Gabon; as
well as providing working capital for the Company.
There have been no other significant changes in the
nature of the activities of the Company during the
financial year.
DIVIDENDS
No dividends were declared or paid during the
financial year.
REVIEW OF OPERATIONS AND FUTURE
DEVELOPMENTS
The 2015 financial year proved to be a year in which
IronRidge Resources was able to cement its place
as a serious project explorer of high potential and
frontier regions in both Australia and West Africa.
This was achieved by delivering on the majority of
goals set out for the Company in last year’s Review
of Operations.
Key achievements during the past twelve months
included:
• Admission to AIM on 12 February 2015 and
the successful placing for and the subscription
of 96,538,380 new Ordinary Shares to raise
approximately £9.7 million.
• Formalising the Strategic Alliance with Assore
Limited (“Assore”), a South African iron, chrome
and manganese mining specialist and Sumitomo
Corporation (“Sumitomo”), a global resources,
mining, marketing and trading conglomerate
specialising in project development, marketing,
operational and corporate development.
• The appointment of Mr Neil Herbert as an
independent UK based Non-Executive Director
of the Company.
• The appointment of SRK Exploration Services
to carry out exploration activities on behalf of
IronRidge over its Gabonese assets.
• The appointment of Mr Lennard Kolff van
Oosterwijk (“Len Kolff”) as the Company’s
Country Manager for Gabon overseeing the SRK
ES activities.
• Continuation of exploration activities at our
Australian assets.
ANNUAL REPORT 2015
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Directors’ Report
The key focus areas for the 2016 financial year are:
Gabon (Tchibanga and Tchibanga Nord)
• Continue the ongoing sampling and
mapping program
•
Prioritise the existing 21 drill targets
• Maiden resource by drilling up to 5000m
• Continue social, and environmental studies
• Commence metallurgy, petrology,
engineering and financial modelling studies
Management believes that it now has the
portfolio of development assets and skill sets
required to create one of the next major successes
in the resources sector. By continuing to secure
partnerships with leading financiers and customers
such as Sumitomo Corporation and Assore Limited,
IronRidge will have all the ingredients necessary
to produce exceptional results for the benefit of
its shareholders.
EXPLORATION ACTIVITIES
Gabon (Belinga Sud)
Gabon
The IronRidge projects in Gabon, West Africa,
are shown in the following Figure 1. Gabon is
one of the more advanced nations in Africa, with
an economy largely based on oil. It is however a
recognised region for hosting iron ore, and the
stable Gabonese Government is promoting mining
investment. The country already has substantial rail
and port infrastructure in place.
During the year, IronRidge continued to advance
the exploration and development of its three 100%
owned iron ore projects in the Republic of Gabon,
West Africa.
• Continue the ongoing sampling and
mapping program
•
Identify and prioritise drill targets
• Maiden resource by drilling up to 5000m
• Continue social and environmental studies
• Commence metallurgy, petrology,
engineering and financial modelling studies
Australia (Monogorilby and Tholstrups)
• Continue the ongoing sampling, mapping
and drilling program
• Complete the Hydro Metallurgical test work
for Titanium and Bauxite
• Upgrade the current 1.1bt 3.5% Ti02
resource into JORC compliance
•
Further investigate the recent Bauxite
discovery at Tholstrups and Monogorilby.
• A likely technically and economically feasible
process for the larger Monogorilby Ti – Al
resource
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ANNUAL REPORT 2015
Directors’ Report
Figure 1: IronRidge Resources Gabon Tenement Locations
The Tchibanga Iron Project (“Tchibanga and Tchibanga Nord” or “Project”), located in the southwest
region of Gabon, is a near term iron ore exploration and development opportunity with the potential to
produce DSO rapidly at < 70km from the proposed deep water port of Mayumba.
The Belinga Sud Iron Project (“Belinga Sud” or “Project”) is a medium to longer term exploration and
development opportunity with the potential to produce DSO utilising existing infrastructure; rail and port at
Owendo.
ANNUAL REPORT 2015
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Directors’ Report
Tchibanga Project Area:
The two Tchibanga Permis de Recherche (see Figures 1 & 2) covers 3,377km² and is along strike from
known iron occurrences. The area has not been subject to any “modern era” exploration until now. The
tenement is proximate to the proposed port site of Mayumba and due to this unique proximity to coast
and infrastructure is the primary focus of the company.
On 14 May 2015, the Company engaged SRK Exploration Services Limited to carry out exploration activities
on behalf of IronRidge over its Gabonese assets. To date SRK Exploration Services are into their third (3rd)
month of exploration activities in the Tchibanga project area.
Figure 2: Tchibanga Project license areas over greyscale topography image (SRTM), major road network (black linework) and main
towns, Gabon, West Africa
SRK have set up a designated office in the township of Tchibanga along with satellite base camps as
required along the base of the Mont Pele and Mayombe ranges. To date SRK have collected a total of 363
samples and traversed some 47.4 line km’s, culminating in 6,124 man hours worked without loss time injury.
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ANNUAL REPORT 2015
Directors’ Report
Figure 3: overview of Tchibanga project area landscape and current area of exploration focus
The Company recently acquired SPOT6/7 satellite imagery over the project area, including high resolution
World DEM radar satellite digital terrain model data. This will be used to help define potential canga
plateaus through the vegetation cover, as well as geological mapping and logistical access support.
Ongoing geological mapping of target areas has provided additional targeting rationale into areas of
potential high-grade direct shipping ore (“DSO”) and near DSO surface enriched canga mineralisation.
Consequently, targeting rationale is focused on high-grade DSO canga plateaus, as well as geophysical
anomalies and areas of potential structural and hypogene enrichment of the underlying host iron rich
lithologies.
ANNUAL REPORT 2015
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Directors’ Report
Figure 4: DSO/near DSO canga mineralisation sampled within the Mt Pele area showing massive, low
porosity, hematite-goethite replacement of clasts and matrix (left), and rotated canga block along margin
of canga plateau showing potential >5m thickness of canga mineralisation.
IronRidge acquired Falcon Gravity and aeromagnetic data over the Tchibanga area.
Sampling and mapping has confirmed a correlation of the characteristic signatures
provided by magnetics, gravity and topography data, including the ability to
differentiate between potential hematite and magnetite targets. The Company will
continue to assess the potential areas of DSO and near DSO canga plateau formation
as well as the geophysical target areas as mapping continues across the >100km of
prospective strike.
Figure 5: Tchibanga project area licenses with aeromagnetic analytical signal (ANSIG) magnetics image
below showing magnetic anomalies along the prospective Range.
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ANNUAL REPORT 2015
Directors’ Report
SRK have established and are maintaining good community and social responsibility programs.
Figure 6: Meetings held with the Sub-Prefect of the Nyanga Province Mons Dominic Dambama (top) and the Governor of the
Nyanga Province Mons Sany Megwazeb (bottom)
Belinga Sud Project Area
The Belinga Sud Permis de Recherche (see Figures 1 & 5) covers 1,976 km² and hosts hematite in
conventional Palaeoproterozoic Banded Iron Formations (BIF). It is directly south of the Belinga Iron Ore
Deposit (860 Mt @ 63% Fe), and 150 km from the Trans-Gabonese rail line. The tenement contains several
exploration targets evident from magnetic anomalies and preliminary exploration, and the potential for an
initial direct shipping (DSO) project.
Figure 7: Belinga Sud Project license area over greyscale topography image (SRTM),
road access (black linework) and main town of Makokou, Gabon, West Africa
The Company recently acquired SPOT6/7 satellite imagery over the project area, including high resolution
World DEM radar satellite digital terrain model data. This will be used to help define potential canga
plateaus through the vegetation cover, as well as geological mapping and logistical access support.
ANNUAL REPORT 2015
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Directors’ Report
Figure 8: Belinga Sud Project and key target areas over analytical signal aero magnetics image (ANSIG)
background and historical sampling, Gabon, West Africa
Australia
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ANNUAL REPORT 2015
Figure 9: IronRidge Resources Australia Tenement Locations
Directors’ Report
Quaggy Project Area
Monogorilby and Tholstrups Project Area
During the year, the Company completed 8
percussion holes for 687 metres within a small
area of the Quaggy nickel cobalt copper platinum
prospect (EPM 18534). The drilling was designed
to investigate the cause of the non-outcropping
coincident nickel platinum palladium anomaly and
sub surface conductor.
The drilling verified the existence of prospective
ultrabasic rocks with minor nickel sulphide
disseminations and platinum and palladium
mineralisation. The copper anomalism in the laterite
soils nearby remains unexplained. The highest
values were 0.2% nickel, 0.15% cobalt, 0.2 g/t
platiunum and 0.6 g/t palladium.
The grades of mineralisation encountered were low,
and the remaining prospective areas while quite
extensive, are all covered by lateritised alluvium,
which means that further exploration is more
expensive and high risk.
Efforts are being made to seek a joint venture
partner to continue work.
An application (EPM 25954) has been lodged over
a large drilled resource of magnetite close to
the port of Gladstone. A low level program is
envisaged, involving a review of the project
economics, and possible investigations for nickel
copper and platinum.
At the Monogorilby titanium alumina iron prospect
(EPM 16260 and 16261), the new program has
begun, with two objectives.
The long term objective is to commercialise the
very large titania alumina iron resources. IronRidge
has engaged Core Metallurgy Pty Ltd to study the
feasibility of using hydrometallurgical routes to
produce acceptable titania alumina and possible
iron oxide products on site.
The short term objective is to provide tonnage
grade and quality parameters for a bauxite layer
that underlies the laterite cap. To date this material
has been highly variable in terms of quality (ie.
available alumina and reactive silica contents).
Recent discoveries of modest volumes of higher
quality material nearby by IronRidge and by others
has opened the opportunity for blending to
produce a saleable product.
These adjacent bauxites within EPM 19419 were
recognised on the roadside during the first field
visit since the grant of the exploration tenement.
The new bauxite assayed 44.5% alumina and 2.1%
total silica.
A new tenement ( EPMA 25975 ) has been applied
for, in order to more fully protect these new bauxite
occurrences.
Figure 10: Drill Section Quaggy
ANNUAL REPORT 2015
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Directors’ Report
Figure 11: Bauxite Exposure at Monogorilby
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ANNUAL REPORT 2015
Directors’ Report
Figure 12: Bauxite layer within the Monogorilby titania deposit
Figure 13: Bauxite layer within the Monogorilby Titanium deposit
ANNUAL REPORT 2015
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Directors’ Report
The loss after income tax for the Group for the year
ended 30 June 2015 was $2,038,074.
SIGNIFICANT CHANGES
IN THE STATE OF AFFAIRS
During the financial year ended 30 June 2015,
issued capital increased to $25,777,728 from
$6,661,258 as a result of a seed capital raising
totaling $574,618 and the issue of 96,538,380 new
ordinary shares totaling $19,178,655, net of share
issue costs of $636,803 due to the Company being
admitted to AIM.
In the opinion of the Directors, there were no
other significant changes in the state of affairs of
the Group that occurred during the financial year
under review not otherwise disclosed in this report
or the financial statements of the Group for the
financial year.
ENVIRONMENTAL REGULATIONS
AND PERFORMANCE
The Directors have put in place strategies and
procedures to ensure that the Group manages its
compliance with environmental regulations. The
Directors are not aware of any breaches of any
applicable environmental regulations.
PROCEEDINGS ON
BEHALF OF COMPANY
No person has applied to the Court under section
237 of Corporations Act 2001 for leave to bring
proceedings on behalf of the Company, or to
intervene in any proceedings to which the Company
is a party, for the purpose of taking responsibility
on behalf of the Company for all or any part of
those proceedings.
No proceedings have been brought or intervened
in on behalf of the Company with leave of the Court
under section 237 of the Corporations Act 2001.
The remuneration report details the remuneration
arrangements for key management personnel
(“KMP”) who are defined as those persons having
authority and responsibility for planning, directing
and controlling the activities of the Company and
the Group, directly or indirectly, including any
director (whether executive or otherwise) of the
Company, and includes the executive team.
The remuneration report is presented under the
following sections:
1.
Individual key management
personnel disclosures
2. Remuneration policy
3. Non-executive director remuneration
arrangements
4. Executive remuneration arrangements
5. Company performance and the
link to remuneration
6. Executive contractual arrangements
7. Equity instruments disclosures
1. Individual Key Management
Personnel Disclosures
Key management personnel
(i) Directors
Nicholas Mather
Executive Chairman
Vincent Mascolo
Managing Director and
Chief Executive Officer
Stuart Crow
Non-executive Director
Neil Herbert
Non-executive Director
REMUNERATION REPORT (AUDITED)
Bastiaan van Aswegen Non-executive Director
This remuneration report for the year ended 30
June 2015 outlines the remuneration arrangements
of the Company and the Group in accordance with
the requirements of the Corporations Act 2001 (the
“Act”) and its regulations. This information has been
audited as required by section 308(3C) of the Act.
21
ANNUAL REPORT 2015
Alistair McAdam
Non-executive Director
Tsuyoshi Ueda
Non-executive Director
Directors’ Report
(ii) Executives
Len Kolff
Country Manager – Gabon
(appointed 1 July 2015)
Karl Schlobohm*
Company Secretary
Priy Jayasuriya*
Chief Financial Officer
Barry Stoffell
Amanda Geard
Chief Geologist,
New Opportunities Group
(resigned 30 June 2015)
Business Generation,
New Opportunities Group
(resigned 30 June 2015)
* Karl Schlobohm and Priy Jayasuriya were
remunerated by DGR Global Limited up until the
Company was admitted to AIM.
There were no changes to KMP after reporting
date and before the date the financial report was
authorized for issue.
2. Remuneration Policy
IronRidge Resources Limited’s remuneration
strategy is designed to attract, motivate and retain
employees and NEDs by identifying and rewarding
high performers and recognising the contribution
of each employee to the continued growth and
success of the Group.
The Board of Directors is responsible for
determining and reviewing compensation
arrangements for the Directors and the Executive
team. The Board assesses the appropriateness
of the nature and amount of remuneration of
such officers on a periodic basis by reference to
relevant employment market conditions with the
overall objective of ensuring maximum shareholder
benefit from the retention of a high quality Board
and Executive team. Such officers are given the
opportunity to receive their base remuneration in a
variety of forms including cash and fringe benefits.
It is intended that the manner of payments chosen
will be optimal for the recipient without creating
undue cost for the Company. Further details on the
remuneration of Directors and Executives are set out
in this Remuneration Report.
The Company aims to reward the Executives with
a level and mix of remuneration commensurate
with their position and responsibilities within the
Company. The Board’s policy is to align Executive
objectives with shareholder and business objective
by providing a fixed remuneration component and
offering long-term incentives.
In accordance with best practice corporate
governance, the structure of NED and executive
remuneration is separate and distinct.
3. Non-Executive Director
Remuneration Arrangements
The Board seeks to set aggregate remuneration
at a level that provides the Company with the
ability to attract and retain directors of the highest
caliber, whilst incurring a cost that is acceptable to
shareholders. The Company’s specific policy for
determining the nature and amount of remuneration
of Board members of the Company is as follows:
The Constitution of the Company provides that the
NEDs are entitled to remuneration as determined
by the Company in a general meeting to be
apportioned among them in such manner as the
Directors agree, and, in default of agreement,
equally. The aggregate remuneration per annum
will be determined at the next annual general
meeting. Additionally, NEDs are entitled to be
reimbursed for properly incurred expenses.
If a NED performs extra services, which in the
opinion of the Directors are outside the scope of
the ordinary duties of the Director, the Company
may remunerate that Director by payment of a fixed
sum determined by the Directors in addition to
or instead of the remuneration referred to above.
However, no payment can be made if the effect
would be to exceed the maximum aggregate
amount payable to NEDs. A NED is entitled to be
paid travelling and other expenses properly incurred
by them in attending Director’s or general meetings
of the Company or otherwise in connection with the
business of the Company.
All Directors have the opportunity to qualify for
participation in the Company’s Employee Share
Option Plan (“ESOP”), subject to the approval of
shareholders.
The remuneration of NEDs for the year ended 30
June 2015 is detailed in this Remuneration Report.
ANNUAL REPORT 2015
22
Directors’ Report
4. Executive Remuneration Arrangements
6. Executive Contractual Arrangements
The Company aims to reward the Executives with
a level and mix of remuneration commensurate
with their position and responsibilities within the
Company and so as to:
•
•
align the interests of the Executives with
those of shareholders;
link reward with the strategic goals and
performance of the Company; and
ensure total remuneration is competitive by
•
market standards.
The remuneration of Executives may from time to
time be fixed by the Board. The remuneration will
comprise a fixed remuneration component and also
may include offering specific short and long-term
incentives, in the form of:
• performance based salary increases and/or
bonuses; and/or
•
the issue of options.
The remuneration of the Executives employed
on a full-time basis by the Company for the
year ending 30 June 2015 is detailed in this
Remuneration Report.
5. Company Performance And The
Link To Remuneration
During the financial year, the Company has
generated losses as its principal activity was
mineral exploration. Up until 12 February 2015, the
Company’s ordinary shares were not traded on any
exchange and there were no dividends paid during
the year.
As the Company is still in the exploration and
development stage, the link between remuneration,
Company performance and shareholder wealth is
tenuous. Share prices are subject to the influence
of metals prices and market sentiment toward the
sector, and as such increases or decreases may
occur quite independent of Executive performance
or remuneration.
It is the Board’s policy that employment agreements
are entered into with all Executives.
The current service agreement with the Managing
Director and Chief Executive Officer has a notice
period of three (3) months. All other employment
agreements have one month (or less) notice
periods. Executives are entitled to their statutory
entitlements of accrued annual leave and long
service leave together with any superannuation on
termination. No other termination payments are
payable.
The terms of appointment for NEDs are set out in
the letters of appointment.
Managing Director and Chief Executive Officer
The Company has a three (3) year Executive
Service Agreement with Alberona Pty Ltd an entity
associated with Mr Vincent Mascolo, which took
effect on 28 February 2014 for the provision of
certain consultancy services. Alberona Pty Ltd will
provide Mr Vincent Mascolo as Executive Director
of IronRidge Resources Limited. Under the terms of
the agreement:
• Alberona Pty Ltd is entitled to a base fee
for the services of Mr Mascolo of $180,000
per annum, increasing to $250,000 per
annum on the date the Company’s shares
are admitted to quotation on the ASX
and increasing to $350,000 from the day the
company has a market capitalisation of equal
to or greater than $100 million.
• Both the Company and Alberona Pty Ltd
are entitled to terminate the contract upon
giving three (3) months written notice.
•
The Company is entitled to terminate the
agreement immediately upon the happening
of certain events in respect of Alberona Pty
Ltd’s solvency or certain acts of misconduct;
• Mr Mascolo is entitled to a short-term
incentive equal to 100% of the base fee
over the lifetime of the Executive Service
Agreement with Alberona Pty Ltd on
meeting the following key performance
indicators
23
ANNUAL REPORT 2015
Directors’ Report
a)
b)
c)
d)
e)
10% - Compliance with statutory requirements and board reporting;
25% - Share price re-rating;
25% - Project advancement and or value adding acquisition;
30% - Promotional achievement, capital management & successful cash raisings; and
10% - No lost time injury and adherence to OHES policies; and
• Mr Mascolo is entitled to a long-term Incentive equal to a maximum of 4% interest in the share
capital of the company upon meeting certain key performance indicators as set by the board.
Other Executives
Employment contracts entered into with Executives contain the following key terms:
Event
Performance based salary increases and/or bonuses
Short and long-term incentives, such as options
Resignation/ notice period
Serious misconduct
Company Policy
Board discretion
Board discretion
1 month
Company mayterminate at any time
Payouts upon resignation or termination, outside industrial regulations (i.e. ‘golden handshakes’)
None
Remuneration of Directors and Other Key Management Personnel
Directors
Nicholas Mather
2015
2014
Vincent Mascolo
2015
2014
Stuart Crow
2015
2014
Neil Herbert1
2015
2014
Bastiaan Van Aswegen2
2015
2014
Alistair McAdam3
2015
2014
Tsuyoshi Ueda4
2015
2014
Total remuneration
2015
2014
Short Term
Benefits
Salary & Fees
$
Post-
Employment
Superannuation
$
Share Based Payments
Equity Settled
Options
$
Shares
$
Total
$
Consisting of
Options
%
175,000
50,000
206,666
180,000
55,000
52,500
20,000
-
22,857
-
22,857
-
5,806
-
508,187
282,500
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
19,409
-
38,820
-
19,409
-
-
-
-
-
-
-
-
-
-
-
-
215,200
-
-
-
-
-
-
-
-
-
-
-
77,638
215,200
175,000
69,409
206,666
434,020
55,000
71,909
20,000
-
22,857
-
22,857
-
5,806
-
508,187
575,338
-
28%
-
9%
-
27%
-
-
-
-
-
-
-
-
Alternate directors do not receive any form of remuneration for their services. 1 Neil Herbert was appointed 12 February 2015. 2 Bastiaan Van Aswegen was appointed 12
February 2015. 3 Alistair McAdam was appointed 12 February 2015. 4 Tsuyoshi Ueda was appointed 26 May 2015.
ANNUAL REPORT 2015
24
Directors’ Report
Remuneration of Directors and Other Key Management Personnel (continued)
Other Key
Management
Personnel
Len Kolff1
2015
2014
Karl Schlobohm2
2015
2014
Priy Jayasuriya2
2015
2014
Barry Stoffell3
2015
2014
Amanda Geard3
2015
2014
Total Renumeration
2015
2014
Short Term
Benefits
Salary & Fees
$
Post-
Employment
Superannuation
$
Share Based Payments
Equity Settled
Options
$
Shares
$
Total
$
Consisting of
Options
%
10,291
-
19,049
-
19,049
-
118,503
-
118,503
-
285,395
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
6,470
-
6,470
-
34,744
-
34,744
-
-
-
-
-
-
-
201,375
-
201,375
10,291
-
19,049
6,470
19,049
6,470
118,503
236,119
118,503
236,119
-
-
82,428
402,750
285,395
485,178
-
-
-
100%
-
100%
-
15%
-
15%
1 Len Kolff was appointed 1 July 2015 and provided consulting services to the Company in May and June 2015.
2 Karl Schlobohm and Priy Jayasuriya were remunerated by DGR Global Limited up until the Company was admitted to AIM on 12 February 2015.
3 Barry Stoffell and Amanda Geard resigned on 30 June 2015.
There were no other executives employed or remunerated by the Company or the Group during the years
ended 30 June 2015 and 2014.
Performance income as a proportion of total remuneration
There was no performance based remuneration during the year.
7. Equity Instruments Disclosures
Shares and Options issued as part of remuneration for the year ended 30 June 2015
Shares and options may be issued to Directors and Executives as part of their remuneration. The shares
and options are not issued based on performance criteria, but are issued to the majority of Directors
and Executives of the Company to align comparative shareholder return and reward for Directors and
Executives.
Shares and Options granted as remuneration
There were no shares issued as part of remuneration of directors and other key management personnel
during the financial year ended 30 June 2015. Details of shares issued as part of remuneration of directors
and other key management personnel in the prior financial year are as follows:
25
ANNUAL REPORT 2015
Directors’ Report
Director Shares
Key Management Personnel Shares
Grant Date
31/01/2014
20/12/2013
Issue Price
$0.08
$0.075
The number of ordinary shares granted to directors and other key management personnel as part of
compensation during the year ended 30 June 2014 are set out below:
Number of Shares Granted During the Year 2014
Directors
Nicholas Mather
Vince Mascolo
Stuart Crow
Other Key Management Personnel
Karl Schlobohm
Priy Jayasuriya
Amanda Geard
Barry Stoffell
Total
-
2,690,000
-
-
-
2,685,000
2,685,000
8,060,000
The terms and conditions of the grant of options over ordinary shares affecting remuneration of directors
and other key management personnel in this financial year or future reporting years are as follows:
Director Options
Key Management
Personnel Options
Grant Date
31/01/2014
31/01/2014
Vesting Date and
Exercisable Date
Expiry Date
Exercise Price
Fair Value per Option at
Grant Date
31/01/2014
31/12/2017
31/01/2014
31/12/2017
£0.10
£0.10
£0.007
£0.007
ANNUAL REPORT 2015
26
Directors’ Report
Options granted carry no dividend or voting rights. There was no amount paid or payable by the recipients
There were no options issued to directors and other key management personnel during the year ended 30
June 2015. The number of options over ordinary shares granted to and vested by directors and other key
management personnel as part of compensation during the year ended 30 June 2014 are set out below:
Number of Options
Granted during the
Year 2014
Number of Options
Vested during the
Year 2014
Directors
Nicholas Mather
Vince Mascolo
Stuart Crow
Other Key Management Personnel
Karl Schlobohm
Priy Jayasuriya
Amanda Geard
Barry Stoffell
Total
1,500,000
3,000,000
1,500,000
500,000
500,000
2,685,000
2,685,000
12,370,000
1,500,000
3,000,000
1,500,000
500,000
500,000
2,685,000
2,685,000
12,370,000
Shares issued on exercise of remuneration options
There were no options exercised during the year that were previously granted as remuneration (2014: nil).
Additional disclosures relating to key management personnel
Shareholdings
Directors
Nicholas Mather
Vincent Mascolo
Stuart Crow
Neil Herbert
Bastiaan Van Aswegen
Alistair McAdam
Thomas Ueda
Other Key Management Personnel
Len Kolff
Karl Schlobohm
Priy Jayasuriya
Barry Stoffell
Amanda Geard
Total
Balance
1 July 2014
Granted as
Compensation
Options
Exercised
Net Change
Other*
Balance
30 June 2015
1,303,703
8,310,291
1,000,000
-
-
-
-
-
292,500
-
2,685,000
2,685,000
16,276,494
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(2,685,000)
(2,685,000)
1,303,703
8,310,291
1,000,000
-
-
-
-
-
292,500
-
-
-
(5,370,000)
10,906,494
*”Net Change Other” above includes the balance of shares held on appointment / resignation, and shares acquired for cash.
There were no shares held nominally at 30 June 2015 (2014: nil).
27
ANNUAL REPORT 2015
Directors’ Report
Option Holdings
Current Year
Balance
1 July 2014
Granted
Exercised
Other
Balance
30 June
2015
Vested at the
end of the
Year
Vested and
Exercisable at
the end of the
Year
Vested and
Unexercis-
able at the
end of the
Year
Directors
Nicholas Mather
1,500,000
Vincent Mascolo
3,000,000
Stuart Crow
1,500,000
Neil Herbert
Bastiaan Van
Aswegen
Alistair McAdam
Thomas Ueda
-
-
-
-
Other Key Management Personnel
Len Kolff
-
Karl Schlobohm
500,000
Priy Jayasuriya
500,000
Barry Stoffell
2,685,000
Amanda Geard
2,685,000
Total
12,370,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,500,000
1,500,000
1,500,000
3,000,000
3,000,000
3,000,000
1,500,000
1,500,000
1,500,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
500,000
500,000
500,000
500,000
-
-
-
-
-
500,000
500,000
-
-
(2,685,000)
(2,685,000)
-
-
-
-
(5,370,000) 7,000,000
7,000,000
7,000,000
-
-
-
-
-
-
-
-
-
-
-
-
-
There were no options held nominally at 30 June 2015 (2014: nil).
ANNUAL REPORT 2015
28
Directors’ Report
Loans to Key Management Personnel
There were no loans to Directors or other key management personnel during the year.
Other Transactions with Key Management Personnel
There were no other transactions or balances with key management personnel during the period.
(End of Remuneration Report)
DIRECTORS’ MEETINGS
The number of meetings of Directors held during the year and the number of meetings attended by each
Director was as follows:
Nicholas Mather
Vince Mascolo
Stuart Crow
Neil Herbert
Bastiaan Van Aswegen
Alistair McAdam
Thomas Ueda
Christelle Van der Merwe
Number of
Meetings Held
While in Office
Meetings
Attended
5
5
5
4
4
4
2
2
5
5
5
4
2
4
2
2
INDEMNIFICATION AND INSURANCE OF DIRECTORS, OFFICERS AND AUDITOR
Each of the Directors and Secretary of the Company has entered into a Deed with the Company whereby
the Company has provided certain contractual rights of access to books and records of the Company to
those Directors. The Company has insured all of the Directors. The contract of insurance prohibits the
disclosure of the nature of the liabilities covered and amount of the premium paid. The Corporations Act
does not require disclosure of the information in these circumstances.
The Company has not indemnified or insured its auditor.
OPTIONS
At the date of this report, the unissued ordinary shares of IronRidge Resources Ltd under option
are as follows:
Grant date
Date of Expiry
Exercise Price
31 January 2014
31 December 2017
£0.10
Number
under Option
13,270,000
SIGNIFICANT EVENTS AFTER THE BALANCE DATE
The Directors are not aware of any significant changes in the state of affairs of the Company after the
balance date that is not covered in this report.
29
ANNUAL REPORT 2015
Directors’ Report
NON-AUDIT SERVICES
The following non-audit services were provided by the entity’s auditor BDO Audit Pty Ltd and its overseas
affiliates. The Directors are satisfied that the provision of non-audit services is compatible with the general
standard of independence for auditors imposed by the Corporations Act. The nature and scope of each
type of non-audit service provided means that auditor independence was not compromised.
BDO Audit Pty Ltd and its overseas affiliates received the following amounts for the provision
of non-audit services:
Other assurance services
195,503
AUDITOR’S INDEPENDENCE DECLARATION
The Auditor’s Independence Declaration forms part of the Directors’ Report and can be found on page 31.
Signed in accordance with a resolution of Directors:
Vincent Mascolo
Managing Director and CEO
Brisbane
Date: 29 September 2015
Qualified Person: Information in this report relating to the exploration results is based on data reviewed by Mr Nicholas Mather
(B.Sc. Hons Geol.), Executive Director of the Company. Mr Mather is a Fellow of the Australasian Institute of Mining and
Metallurgy who has in excess of 25 years’ experience in mineral exploration and is a Qualified Person under the AIM Rules.
Mr Mather consents to the inclusion of the information in the form and context in which it appears.
ANNUAL REPORT 2015
30
Directors’ Report
Auditor’s
Independence
Declaration
DECLARATION OF INDEPENDENCE BY D P WRIGHT TO THE DIRECTORS OF
IRONRIDGE RESOURCES LIMITED
As lead auditor of IronRidge Resources Limited for the year ended 30 June 2015, I declare
that, to the best of my knowledge and belief, there have been no contraventions of:
1. the auditor independence requirements of the Corporations Act 2001 in relation to the
audit; and
2. any applicable code of professional conduct in relation to the audit.
This declaration is in respect IronRidge Resources Limited and the entities it controlled
during the period.
D P Wright
Director
BDO Audit Pty Ltd
Brisbane,
29 September 2015
BDO Audit Pty Ltd ABN 33 134 022 870 is a member of a national association of independent entities which are all members of
BDO Australia Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit Pty Ltd and BDO Australia Ltd
are members of BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of
independent member firms. Liability limited by a scheme approved under Professional Standards Legislation, other than for the
acts or omissions of financial services licensees.
31
ANNUAL REPORT 2015
Interest
In tenements
As at the date of this report, the Group has an interest in the following tenements.
Tenement
Australia
EPM 18534
EPM 19164
EPM 19419
EPM 25115
EPMA 25954
EPM 16260
EPM 16261
Gabon
Authorisation de prospection G6-525
Authorisation de prospection G6-526
Authorisation de prospection G5-533
Interest
%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
Grant Date
Application Date
Expiry Date
Term
12.10.14
30.09.13
26.08.14
08.04.14
-
27.06.15
28.05.15
28.06.13
28.06.13
05.12.13
-
-
-
-
22.05.15
-
-
-
-
-
11.10.16
29.09.15
25.08.17
07.04.17
-
11.06.17
27.05.17
27.06.16
27.06.16
04.12.16
2 years
2 years
3 years
3 years
-
2 years
2 years
3 years
3 years
3 years
ANNUAL REPORT 2015
32
Consolidated Statement
of Comprehensive Income
For the year ended 30 June 2015
Revenue
Administration and consulting
expenses
Depreciation
Employee benefits expenses
Exploration costs written-off
Legal expenses
Interest expense
Listing costs expensed
Share based payments
(Loss) before income tax
Income tax expense
(Loss) for the year
Other comprehensive income
Total comprehensive income
for the year attributable
to the owners of IronRidge
Resources Limited
Loss per share
Basic loss per share
Diluted loss per share
Notes
2
16
3
4
8
8
2015
$
916
2014
$
2,221
(944,867)
(1,079,918)
(4,030)
(55,404)
(47,990)
(62,718)
(2)
(923,979)
-
(4,384)
-
(10,073)
(25,000)
(11)
(518,453)
(789,661)
(2,038,074)
(2,425,279)
-
-
(2,038,074)
(2,425,279)
-
-
(2,038,074)
(2,425,279)
Cents / share
Cents / share
(1.2)
(1.2)
(2.0)
(2.0)
The above consolidated statement of comprehensive income should be read in conjunction with the
accompanying notes.
33
ANNUAL REPORT 2015
Consolidated Statement
of Financial Position
For the year ended 30 June 2015
Notes
9
10
11
12
13
14
20(e)
15
17
Current assets
Cash and cash equivalents
Trade and other receivables
Prepaid IPO costs
Total current assets
Non-current assets
Other financial assets
Property, plant and equipment
Exploration and evaluation
assets
Total non-current assets
Total assets
Current liabilities
Trade and other payables
Non-Interest-bearing loans
Total current liabilities
Total liabilities
Net assets
Equity
Issued capital
Reserves
Accumulated losses
Total equity attributable to
owners of IronRidge
Resources Limited
2015
$
14,947,231
36,154
-
14,983,385
53,666
8,768
3,117,009
3,179,443
18,162,828
279,040
-
279,040
279,040
17,883,788
25,777,728
171,711
(8,065,651)
2014
$
27,600
29,424
386,476
443,500
63,103
11,010
1,590,815
1,664,928
2,108,428
1,293,831
9,205
1,303,036
1,303,036
805,392
6,661,258
171,711
(6,027,577)
17,883,788
805,392
The above consolidated statement of financial position should be read in conjunction with the
accompanying notes.
ANNUAL REPORT 2015
34
Consolidated Statement
of Changes in Equity
For the year ended 30 June 2015
Issued Capital Accumulated Losses
Share Based
Payments Reserve
Total Equity
Balance at 30 June 2013
Loss for the year
Other comprehensive income
Total comprehensive income for the year
Shares issued during the year
Share issue costs, net of tax
Share based payments
$
4,391,686
-
-
-
2,310,586
(41,014)
-
$
(3,602,298)
(2,425,279)
-
(2,425,279)
-
-
-
Balance at 30 June 2014
6,661,258
(6,027,577)
Loss for the year
Other comprehensive income
Total comprehensive income for the year
Shares issued during the year
Share issue costs, net of tax
-
-
-
19,753,273
(636,803)
(2,038,074)
-
(2,038,074)
-
-
$
-
-
-
-
-
-
171,711
171,711
-
-
-
-
-
$
789,388
(2,425,279)
-
(2,425,279)
2,310,586
(41,014)
171,711
805,392
(2,038,074)
-
(2,038,074)
19,753,273
(636,803)
Balance at 30 June 2015
25,777,728
(8,065,651)
171,711
17,883,788
The above consolidated statement of cash flows should be read in conjunction with the
accompanying notes.
35
ANNUAL REPORT 2015
Consolidated Statement
of Cash Flows
For the year ended 30 June 2015
Cash flows from operating activities
Notes
2015
$
122,627
(1,502,615)
916
(2)
2014
$
114,810
(798,468)
2,221
(11)
19
(1,379,074)
(681,448)
(2,500)
11,937
(1,788)
(1,593,043)
(1,585,394)
19,723,290
(2,076,144)
-
-
-
(5,000)
10,000
-
(477,461)
(472,461)
1,375,438
(25,313)
(203,846)
14,115
(8,546)
17,647,146
1,151,848
14,682,678
27,600
236,953
9
14,947,231
(2,061)
29,661
-
27,600
Receipts from customers
(including GST)
Payments to suppliers and
employees (including GST)
Interest received
Interest paid
Net cash flows from
operating activities
Cash flows from investing activities
Payments for security deposits
Refund of security deposits
Purchase of property, plant
and equipment
Payments for exploration and
evaluation assets
Net cash flows from
investing activities
Cash flows from financing activities
Proceeds from the issue
of shares
Transactions costs on the issue
of shares
Prepayment of IPO costs
Proceeds from borrowings
Repayment of borrowings
Net cash flows from
financing activities
Net increase / (decrease) in
cash and cash equivalents
Cash and cash equivalents at
the beginning of the year
Net foreign exchange impact
Cash and cash equivalents at
the end of the year
The above consolidated statement of cash flows should be read in conjunction with the
accompanying notes.
ANNUAL REPORT 2015
36
Notes to the
Financial Statements
For the year ended 30 June 2015
NOTE 1: SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES
Corporate Information
The consolidated financial report of IronRidge
Resources Limited for the year ended 30 June
2015 was authorised for issue in accordance with a
resolution of the directors on 29 September 2015.
IronRidge Resources Limited is a public company
limited by shares incorporated and domiciled
in Australia. IronRidge Resources Limited is the
ultimate parent. The Group’s registered office is
located at Level 27 One One One, 111 Eagle Street,
Brisbane, QLD 4000.
continuity of normal business activities and the
realisation of assets and discharge of liabilities in
the ordinary course of business. The Group has
not generated revenues from operations. As such,
the Group’s ability to continue to adopt the going
concern assumption will depend upon a number of
matters including subsequent successful raisings in
the future of necessary funding and the successful
exploration and subsequent exploitation of the
Group’s tenements.
On 12 February 2015, the Company was admitted to
AIM and successfully raised £9,653,838 as part of its
initial public offering. The proceeds raised through
the initial public offering are sufficient in the opinion
of the Directors for the Company to continue as a
going concern.
The nature of the operations and principal activities
of the Group are described in the director’s report.
Reporting basis and conventions
The financial report has been prepared on an
accruals basis and is based on historical costs
modified by the revaluation of selected non-current
assets, and financial assets and financial liabilities for
which the fair value basis of accounting has
been applied.
The following is a summary of the material
accounting policies adopted by the Group in
the preparation of the financial report.
Accounting Policies
(a) New Accounting Standards And
Interpretations
The accounting policies adopted are consistent
with those of the previous financial year except as
follows:
The Company has adopted the following new and
amended Australian Accounting Standards and
AASB Interpretations as of 1 July 2014:
Basis Of Preparation
This financial report is a general purpose financial
report that has been prepared in accordance
with Australian Accounting Standards, including
Australian Accounting Interpretations, other
authoritative pronouncements of the Australian
Accounting Standards Board and the Corporations
Act 2001. The Group is considered a for-profit entity
for the purpose of Australian Accounting Standards.
The financial report covers the Group comprising
of IronRidge Resources Limited and its subsidiaries
and is presented in Australian dollars.
Compliance with IFRS
Australian Accounting Standards include Australian
Equivalents to International Financial Reporting
Standards (AIFRS). Compliance with AIFRS ensures
that the financial statements and notes of IronRidge
Resources Limited comply with International
Financial Reporting Standards (IFRS).
Going concern
The financial statements have been prepared on
a going concern basis which contemplates the
37
ANNUAL REPORT 2015
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Reference
AASB 2012-3
AASB 2013-3
AASB 2013-4
AASB 2013-5
AASB 1031
AASB 2013-9
AASB 2014-1
AASB 2014-1
AASB 2014-Part B
AASB 1053
Title
Application Date of Standard Application Date for the Company
Amendments to Australian
Accounting Standards –
Offsetting Financial Assets
and Financial Liabilities
Amendments to AASB 136 –
Recoverable Amount Disclosures
for Non-Financial Assets
Amendments to Australian
Accounting Standards – Novation
of Derivatives and Continuation
of Hedge Accounting
Amendments to Australian
Accounting Standards – Invest-
ment Entities
Materiality
Amendments to Australian Ac-
counting Standards –
Conceptual Framework, Materiali-
ty and Financial Instruments
Part A -Annual Improvements
2010–2012 Cycle
Part A -Annual Improvements
2011–2013 Cycle
Amendments to Australian
Accounting Standards - Part B
Defined Benefit Plans:
Employee Contributions
Transition to and between
Tiers, and related Tier 2
Disclosure Requirements
1 January 2014
1 July 2014
1 January 2014
1 July 2014
1 January 2014
1 July 2014
1 January 2014
1 July 2014
1 January 2014
1 January 2014
1 July 2014
1 July 2014
1 July 2014
1 July 2014
1 July 2014
1 July 2014
1 July 2014
1 July 2014
1 July 2014
1 July 2014
The adoption of the above standards and interpretations did not have any material impact on the current
or any prior period and is not likely to materially affect future periods.
Australian Accounting Standards and Interpretations that have been recently issued or amended but are
not yet effective have not been adopted by the Company for the annual reporting period ended 30 June
2015. The Consolidated Entity is yet to evaluate the impact of those standards and interpretations on the
financial statements.
ANNUAL REPORT 2015
38
Notes to the Financial StatementsFor the year ended 30 June 2015
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
The Company anticipates that all of the relevant pronouncements will be adopted in the Company’s
accounting policies for the first period beginning after the effective date of the pronouncement.
Information of new standards, amendments and interpretations that are expected to be relevant to
the Company’s financial statements is provided below.
Title
Application Date of Standard Application Date for the Company
Reference
AASB 9
AASB 14
AASB 2014-3
Financial instruments
Regulatory deferral accounts
Amendments to Australian Ac-
counting Standards – Accounting
for Acquisitions of Interests in
Joint Operations
[AASB 1 & AASB 11]
1 January 2016
AASB 2014-4
Clarification of Acceptable
Methods of Depreciation and
Amortisation (Amendments to
AASB 116 and AASB 138)
1 January 2016
AASB 15
AASB 2014-9
AASB 2014-10
AASB 2015-1
AASB 2015-2
AASB 2015-3
AASB 2015-5
Revenue from Contracts with
Customers
Amendments to Australian Ac-
counting Standards –
Equity Method in Separate Finan-
cial Statements
Amendments to Australian
Accounting Standards – Sale or
Contribution of Assets between
an Investor and its Associate or
Joint Venture
Amendments to Australian
Accounting Standards –
Annual Improvements to
Australian Accounting Standards
2012–2014 Cycle
Amendments to Australian
Accounting Standards –
Disclosure Initiative: Amendments
to AASB 101
Amendments to Australian
Accounting Standards arising
from the Withdrawal of AASB
1031 Materiality
Amendments to Australian
Accounting Standards – Invest-
ment Entities: Applying the
Consolidation Exception
39
ANNUAL REPORT 2015
1 January 2018
1 January 2016
1 January 2014
1 July 2016
1 January 2014
1 July 2016
1 January 2017
1 July 2018
1 July 2016
1 July 2014
1 July 2014
1 July 2014
1 July 2014
1 July 2017
1 January 2016
1 July 2016
1 January 2016
1 July 2016
1 January 2016
1 July 2016
1 January 2016
1 July 2016
1 July 2015
1 July 2015
1 July 2015
1 July 2015
Notes to the Financial StatementsFor the year ended 30 June 2015
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(b) Basis Of Consolidation
The consolidated financial statements comprise the
financial statements of IronRidge Resources Limited
and its subsidiaries as at and for the period ended
30 June each year (the “Group”).
Subsidiaries
Subsidiaries are all those entities over which the
consolidated entity has control. The consolidated
entity controls an entity when the consolidated
entity is exposed to, or has rights to, variable returns
from its involvement with the entity and has the
ability to affect those returns through its power to
direct the activities of the entity. Subsidiaries are
fully consolidated from the date on which control is
transferred to the consolidated entity. They are de-
consolidated from the date that control ceases.
The financial statements of the subsidiaries are
prepared for the same reporting period as the
parent company, using consistent accounting
policies. In preparing the consolidated financial
statements, all intercompany balances, transactions,
unrealized gains and losses resulting from intra-
group transactions and dividends have been
eliminated in full.
Subsidiaries are fully consolidated from the date on
which control is obtained by the Group and cease
to be consolidated from the date on which control is
transferred out of the Group.
Investments in subsidiaries held by IronRidge
Resources Limited are accounted for at cost in the
separate financial statements of the parent entity
less any impairment charges. Dividends received
from subsidiaries are recorded as a component of
other revenues by the parent entity, and do not
impact the recorded cost of the investment. Upon
receipt of dividend payments from subsidiaries,
the parent will assess whether any indicators of
impairment of the carrying value of the investment
in the subsidiary exist. Where such indicators
exist, to the extent that the carrying value of the
investment exceeds its recoverable amount, an
impairment loss is recognised.
The acquisition of subsidiaries is accounted for
using the acquisition method of accounting.
The acquisition method of accounting involves
recognising at acquisition date, separately from
goodwill, the identifiable assets acquired, the
liabilities assumed and any non-controlling interest
in the acquiree. The identifiable assets acquired
and the liabilities assumed are measured at their
acquisition date fair values.
The difference between the above items and the
fair value of consideration (including the fair value
of any pre-existing investment in the acquiree) is
goodwill or discount on acquisition.
After initial recognition, goodwill is measured
at cost less any accumulated impairment losses.
For the purpose of impairment testing, goodwill
acquired in a business combination is, from the
acquisition date, allocated to each of the Group’s
cash generating units that are expected to benefit
from the combination, irrespective of whether other
assets or liabilities of the acquiree are assigned to
those units.
Where goodwill forms part of a cash generating unit
and part of the operation within that unit is disposed
of, the goodwill associated with the operation
disposed of is included in the carrying amount of
the operation when determining the gain or loss on
disposal of the operation. Goodwill disposed of in
this circumstance is measured based on the relative
values of the operation disposed of and the portion
of the cash generating unit retained.
Non-controlling interests are allocated their
share of net profit after tax in the statement of
comprehensive income and presented within
equity in the consolidated statement of financial
position, separately from the equity of the owners
of the parent.
Losses are attributed to the non-controlling
interest even if that results in a deficit balance.
ANNUAL REPORT 2015
40
Notes to the Financial StatementsFor the year ended 30 June 2015
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
A change in ownership interest of a subsidiary that
does not result in a loss of control, is accounted for
as an equity transaction.
Joint Arrangements
Joint Operations
The proportionate interests in the assets, liabilities
and expenses of a joint operation activity have been
incorporated in the financial statements under the
appropriate headings.
Joint Ventures
Investments in joint ventures are accounted
for using the equity method. Under the equity
method, the share of the profits or losses of the
joint venture is recognised in profit or loss and the
share of the movements in equity is recognised in
other comprehensive income. Investments in joint
ventures are carried in the statement of financial
position at cost plus post-acquisition changes in
the consolidated entity’s share of net assets of the
joint venture. Goodwill relating to the joint venture
is included in the carrying amount of the investment
and is neither amortised nor individually tested
for impairment. Dividends receivable from joint
venture entities reduces the carrying amount of the
investment.
Changes in Ownership Interests
The Group treats transactions with non-controlling
interests that do not result in a loss of control as
transactions with equity owners of the Group.
A change in ownership interest results in an
adjustment between the carrying amounts of
the controlling and non-controlling interests to
reflect their relative interests in the subsidiary. Any
difference between the amount of the adjustment
to non-controlling interests and any consideration
paid or received is recognised in a separate reserve
within equity attributable to owners of IronRidge
Resources Ltd.
When the Group ceases to have control, or
significant influence, any retained interest in the
entity is remeasured to its fair value with the change
in carrying amount recognised in profit or loss.
The fair value is the initial carrying amount for
the purposes of subsequently accounting for the
retained interest as an associate or financial asset.
In addition, any amounts previously recognised
in other comprehensive income in respect of that
entity are accounted for as if the Group had directly
disposed of the related assets or liabilities. This
may mean that amounts previously recognised in
other comprehensive income are reclassified to
profit or loss.
If the ownership interest in an associate is
reduced but significant influence is retained, only
a proportionate share of the amounts previously
recognised in other comprehensive income are
reclassified to profit or loss where appropriate.
(c) Business Combinations
Business combinations are accounted for using the
acquisition method. The consideration transferred
in a business combination is measured at fair value,
which is calculated as the sum of the acquisition
date fair values of the assets transferred by the
acquirer, the liabilities incurred by the acquirer
to former owners of the acquiree and the equity
issued by the acquirer, and the amount of any
non-controlling interest in the acquiree. For each
business combination, the acquirer measures the
non-controlling interest in the acquiree either at fair
value or at the proportionate share of the acquiree’s
identifiable net assets. Acquisition-related
costs are expensed as incurred, and included in
administrative expenses.
When the Group acquires a business, it assesses
the financial assets and liabilities assumed for
appropriate classification and designation in
accordance with contractual terms, economic
conditions, the Group’s operating or accounting
policies and other pertinent conditions as at the
acquisition date.
If the business combination is achieved in stages,
the acquisition date fair value of the acquirer’s
previously held equity interest in the acquiree is
41
ANNUAL REPORT 2015
Notes to the Financial StatementsFor the year ended 30 June 2015
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
remeasured to fair value through profit and loss.
Any contingent consideration to be transferred
by the acquirer will be recognised at fair value at
the acquisition date. Subsequent changes to the
fair value of the contingent consideration which is
deemed to be an asset or liability will be recognised
in accordance with AASB 139 either in profit or loss
or as a change to other comprehensive income. If
the contingent consideration is classified as equity,
it is not remeasured.
(d) Operating Segments
An operating segment is a component of an entity
that engages in business activities from which it may
earn revenues and incur expenses, whose operating
results are regularly reviewed by the entity’s chief
operating decision maker to make decisions about
resources to be allocated to the segment and assess
its performance and for which discrete financial
information is available. This may include start-up
operations which are yet to earn revenues.
Operating segments that meet the quantitative
criteria as prescribed by AASB 8, Operating
Segments are reported separately. However,
an operating segment that does not meet the
quantitative criteria is still reported separately where
information about the segment would be useful to
users of the financial statements.
Information about other operating segments
that are below the quantitative criteria are combined
and disclosed in a separate category
for “all other segments”.
(e) Cash And Cash Equivalents
For the statement of cash flows, cash and cash
equivalents include cash on hand, deposits held
at call with banks, other short term highly liquid
investments with original maturities of three months
or less, and bank overdrafts. Bank overdrafts are
shown within short-term borrowings in current
liabilities on the statement of financial position.
(f) Trade And Other Receivables
Receivables generally have 30-60 day terms, are
recognised initially at fair value and subsequently
measured at amortised cost using the effective
interest method, less an allowance for impairment.
Collectability of receivables is reviewed on an
ongoing basis. Individual debts that are known to
be uncollectible are written off when identified. An
impairment provision is recognised when there is
objective evidence that the Group will not be able
to collect the receivable. Financial difficulties of
the debtor or debts more than 90 days overdue are
considered objective evidence of impairment. The
amount of the impairment loss is the receivable
carrying amount compared to the present value
of estimated future cash flows, discounted at the
original effective interest rate.
(g) Financial Instruments
Recognition and Initial Measurement
Financial instruments, incorporating financial assets
and financial liabilities, are recognised when the
entity becomes a party to the contractual provisions
of the instrument. Trade date accounting is
adopted for financial assets that are delivered within
timeframes established by marketplace convention.
Financial instruments are initially measured at fair
value plus transactions costs where the instrument
is not classified as at fair value through profit or loss.
Transaction costs related to instruments classified as
at fair value through profit or loss are expensed to
profit or loss immediately. Financial instruments are
classified and measured as set out below.
Classification and Subsequent Measurement
(i) Loans and receivables
Loans and receivables are non-derivative financial
assets with fixed or determinable payments
that are not quoted in an active market and are
subsequently measured at amortised cost using
the effective interest rate method.
(ii) Financial liabilities
Non-derivative financial liabilities (excluding financial
guarantees) are subsequently measured at amortised
cost using the effective interest rate method.
ANNUAL REPORT 2015
42
Notes to the Financial StatementsFor the year ended 30 June 2015
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(iii) Available-for-sale financial assets
Available for sale financial assets comprise
investments in listed entities. These investments
are recorded at cost.
The depreciation rates used for each class of
assets are:
Class of Property, Plant &
Equipment
Depreciation
Derecognition
Plant & Equipment
10% - 15% Straight line
Financial assets are derecognised where the
contractual rights to receipt of cash flows expires
or the asset is transferred to another party whereby
the entity no longer has any significant continuing
involvement in the risks and benefits associated
with the asset. Financial liabilities are derecognized
where the related obligations are either discharged,
cancelled or expire. The difference between the
carrying value of the financial liability extinguished
or transferred to another party and the fair value of
consideration paid, including the transfer of non-
cash assets or liabilities assumed is recognised in
profit of loss.
Office Equipment
33.3% Straight line
Gains and losses on disposals are determined
by comparing proceeds with the carrying
amount. These are included in the statement of
comprehensive income.
Derecognition
An item of property, plant and equipment is
derecognised upon disposal or when no further
future economic benefits are expected from its use
or disposal.
(h) Property, Plant & Equipment
(i) Exploration And Evaluation Assets
Property, plant & equipment are stated at historical
cost less accumulated depreciation and any
accumulated impairment losses.
The cost of property, plant & equipment constructed
within the Group includes the cost of materials, direct
labour, borrowing costs and an appropriate portion
of fixed and variable costs. Subsequent costs are
included in the asset’s carrying amount or recognised
as a separate asset, as appropriate, only when it is
probable that future economic benefits associated
with the item will flow to the Group and the cost of
the item can be measured reliably. All other repairs
and maintenance are charged to the profit or loss
during the financial year in which they are incurred.
Depreciation
The depreciable amount of all property, plant &
equipment is depreciated over their useful life to
the Group commencing from the time the asset is
held ready for use. Leasehold improvements are
depreciated over the shorter of either the unexpired
period of the lease or the estimated useful lives of
the improvements.
43
ANNUAL REPORT 2015
Exploration and evaluation expenditure incurred
is accumulated in respect of each identifiable
area of interest. Such expenditures comprise net
direct costs and an appropriate portion of related
overhead expenditure but do not include overheads
or administration expenditure not having a specific
nexus with a particular area of interest. These assets
are only carried forward to the extent that they are
expected to be recouped through the successful
development of the area or where activities in the
area have not yet reached a stage which permits
reasonable assessment of the existence
of economically recoverable reserves and active
or significant operations in relation to the area
are continuing.
A regular review has been undertaken on each area
of interest to determine the appropriateness of
continuing to carry forward assets in relation to that
area of interest.
A provision is raised against exploration and
evaluation expenditure where the Directors are of the
opinion that the carried forward net cost may not be
recoverable or the right of tenure in the area lapses.
Notes to the Financial StatementsFor the year ended 30 June 2015
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
The increase in the provision is charged against the
results for the year. Accumulated costs in relation
to an abandoned area are written off in full against
profit in the year in which the decision to abandon
the area is made.
When production commences, the accumulated
costs for the relevant area of interest are amortised
over the life of the area according to the rate of
depletion of the economically recoverable reserves.
Costs of site restoration are provided over the life of
the area from when exploration commences and are
included in the costs of that stage. Site restoration
costs include the dismantling and removal of mining
plant, equipment and building structure, waste
removal, and rehabilitation of the site in accordance
with clauses of mining permits. Such costs have
been determined using estimates of future costs,
current legal requirements and technology on an
undiscounted basis.
Any changes in the estimates for the costs are
accounted on a prospective basis. In determining
the costs of site restoration, there is uncertainty
regarding the nature and extent of the restoration
due to community expectations and future
legislation. Accordingly the costs have been
determined on the basis that restoration will be
completed within one year of abandoning the site.
(j) Impairment Of Assets
At each reporting date, the Group reviews the
carrying values of its tangible assets to determine
whether there is any indication that those assets
have been impaired. If such an indication exists,
the recoverable amount of the asset, being the
higher of the asset’s fair value less costs to sell
and value in use, is compared to the asset’s
carrying value. Any excess of the asset’s carrying
value over it recoverable amount is expensed to
the profit or loss.
Where it is not possible to estimate the recoverable
amount of an individual asset, the Group estimates
the recoverable amount of the cash-generating unit
to which the asset belongs.
(k) Trade And Other Payables
Trade and other payables are carried at amortised
cost and due to their short term nature they are not
discounted. They 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. The amounts are unsecured and are
usually paid within 30-60 days of recognition.
(l) Provisions And Employee Benefits
Provisions are recognised when the Group has
a present obligation (legal or constructive) as a
result of a past event, it is possible 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.
When the Group expects some or all of a
provision to be reimbursed, 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 comprehensive income net of
any reimbursement.
Provisions are measured at the present value of
management’s best estimate of the expenditure
required to settle the present obligation at
the reporting date. The discount rate used to
determine the present value reflects current market
assessments of the time value of money and the
risks specific to the liability. The increase in the
provision resulting from the passage of time is
recognised in finance costs.
Employee benefits
(i) Wages, salaries and annual leave
Liabilities for wages and salaries, including non-
monetary benefits and annual leave expected to be
settled within 12 months of the reporting date are
recognised in respect of employees’ services up to
the reporting date.
ANNUAL REPORT 2015
44
Notes to the Financial StatementsFor the year ended 30 June 2015
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
They are measured at the amounts expected to be
paid when the liabilities are settled. Expenses for
non-accumulating sick leave are recognised when
the leave is taken and measured at the rates paid
or payable.
(ii) Long service leave
The liability for long service leave is recognised
and measured as the present value of expected
future payments to be made in respect of services
provided by employees up to the reporting date.
Consideration is given to expected future wages and
salary levels, experience of employee departures,
and periods of service. Expected future payments
are discounted using market yields at the reporting
date on Australian corporate bonds with terms to
maturity and currencies that match, as closely as
possible, the estimated future cash outflows.
(m) Leases
Leases of property, plant & equipment where
substantially all the risks and benefits incidental
to the ownership of the asset, but not the legal
ownership, are transferred to the Group are
classified as finance leases.
(n) Share Capital
Ordinary shares are classified as equity at the time
that they are issued. Costs directly attributable to
the issue of new shares or options are shown as
a deduction from the equity proceeds, net of any
income tax benefit.
(o) Share-Based Payments
The Group may provide benefits to Directors,
employees or consultants in the form of share-based
payment transactions, whereby services may be
undertaken in exchange for shares or options over
shares (“equity-settled transactions”).
The fair value of options granted to Directors,
employees and consultants is recognised as an
employee benefit expense with a corresponding
increase in equity (share option reserve). The fair
value is measured at grant date and recognised
over the period during which the recipients become
unconditionally entitled to the options. Fair value
is determined using a Black-Scholes option pricing
model. An expense is still recognised for options
that do not ultimately vest because a market
condition was not met.
Finance leases are capitalised by recording an asset
and a liability at the lower of the amounts equal to
the fair value of the leased property or the present
value of the minimum lease payments, including any
guaranteed residual values. Lease payments are
allocated between the reduction of the lease liability
and the lease interest expense for the year.
Where the terms of options are modified, the
expense continues to be recognised from grant
date to vesting date as if the terms had never
been changed. In addition, at the date of the
modification, a further expense is recognised for any
increase in fair value of the transaction as a result of
the change.
Leased assets are depreciated on a straight line
basis over their estimated useful lives where it is
likely that the Group will obtain ownership of the
asset or over the term of the lease.
Lease payments for operating leases, where
substantially all the risks and benefits remain with
the lessor, are charged as expenses on a straight
line basis.
Lease incentives under operating leases are
recognised as a liability and amortised on a straight-
line basis over the life of the lease term.
45
ANNUAL REPORT 2015
Where options are cancelled, they are treated
as if vesting occurred on cancellation and any
unrecognised expenses are taken immediately to
the profit or loss. If new options are substituted
for the cancelled options and designated as
a replacement, the combined impact of the
cancellation and replacement options are treated
as if they were a modification.
(p) Revenue
Revenue is recognised and measured at the fair
value of the consideration received or receivable
Notes to the Financial StatementsFor the year ended 30 June 2015
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
to the extent 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:
Interest
Interest revenue is recognized as interest accrues
using the effective interest rate 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.
All revenue is stated net of the amount of goods
and services tax (GST).
(q) Income Tax
The income tax expense for the period is the tax
payable on the current period’s taxable income rate
for each jurisdiction adjusted by changes in deferred
tax assets liabilities attributable to temporary
differences between the tax base of assets and
liabilities and their carrying amounts in the financial
statements, and to unused tax losses.
The charge for current income tax expense is
based on the profit for the year adjusted for any
non-assessable or disallowed items. It is calculated
using the tax rates that have been enacted or are
substantially enacted by the balance date.
Deferred tax is calculated at the tax rates expected
to apply to the period when the asset is realised or
liability is settled. Deferred tax is recognised in the
statement of comprehensive income except where
it relates to items that may be recognised directly
in equity, in which case the deferred tax is adjusted
directly against equity. Deferred income tax assets
are recognised to the extent that it is probable that
future tax profits will be available against which
deductible temporary differences can be utilised.
The amount of benefits brought to account or
which may be realised in the future is based on the
assumption that no adverse change will occur in
income taxation legislation and the anticipation that
the group will derive sufficient future assessable
income to enable the benefit to be realised and
comply with the conditions of deductibility imposed
by the law.
Current tax assets and liabilities are offset where
a legally enforceable right of set-off exists and it
is intended that net settlement or simultaneous
realisation and settlement of the respective asset
and liability will occur. Deferred tax assets and
liabilities are offset where a legally enforceable
right of set-off exists, the deferred tax assets and
liabilities relate to income taxes levied by the same
taxation authority on either the same taxable entity
or different taxable entities where it is intended
that net settlement or simultaneous realisation and
settlement of the respective asset and liability will
occur in future periods in which significant amounts
of deferred tax assets or liabilities are expected to
be recovered or settled.
Deferred tax is accounted for using the balance
sheet liability method in respect of temporary
differences arising between the tax bases of assets
and liabilities and their carrying amounts in the
financial statements. No deferred income tax will
be recognised from the initial recognition of an
asset or liability, excluding a business combination,
where there is no effect on accounting or taxable
profit or loss.
ANNUAL REPORT 2015
46
Notes to the Financial StatementsFor the year ended 30 June 2015
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(r) GST
(t) Comparatives
Revenues, expenses and assets are recognised net
of GST except where 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.
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.
(s) Earnings Per Share
Basic earnings per share is calculated as net profit
(loss) attributable to members of the parent,
adjusted to exclude any costs of servicing equity
other than ordinary shares, divided by the weighted
average number of ordinary shares, adjusted for any
bonus element.
Diluted earnings per share adjust the figures used
in the determination of basic earnings per share to
take into account:
• The after tax effect of interest and other
financing costs associated with dilutive potential
ordinary shares; and
• The weighted average number of additional
ordinary shares that would have been
outstanding assuming the conversion of all
dilutive potential ordinary shares.
When required by Australian Accounting Standards,
comparative figures have been adjusted to conform to
changes in presentation for the current financial year.
(u) Fair Value Measurement
When an asset or liability, financial or non-
financial, is measured at fair value for recognition
or disclosure purposes, the fair value is based on
the price that would be received to sell an asset or
paid to transfer a liability in an orderly transaction
between market participants at the measurement
date; and assumes that the transaction will
take place either: in the principle market; or in
the absence of a principal market, in the most
advantageous market.
Fair value is measured using the assumptions that
market participants would use when pricing the
asset or liability, assuming they act in their economic
best interest. For non-financial assets, the fair value
measurement is based on its highest and best
use. Valuation techniques that are appropriate in
the circumstances and for which sufficient data
are available to measure fair value, are used,
maximising the use of relevant observable inputs
and minimising the use of unobservable inputs.
Assets and liabilities measured at fair value are
classified, into three levels, using a fair value hierarchy
that reflects the significance of the inputs used in
making the measurements. Classifications are reviewed
each reporting date and transfers between levels are
determined based on a reassessment of the lowest level
input that is significant to the fair value measurement.
For recurring and non-recurring fair value
measurements, external valuers may be used when
internal expertise is either not available or when
the valuation is deemed to be significant. External
valuers are selected based on market knowledge and
reputation. Where there is a significant change in fair
value of an asset or liability from one period to another,
an analysis is undertaken, which includes a verification
of the major inputs applied in the latest valuation and
a comparison, where applicable, with external sources
of data.
47
ANNUAL REPORT 2015
Notes to the Financial StatementsFor the year ended 30 June 2015
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(v) Critical Accounting Estimates And Judgments
The Directors evaluate estimates and judgments
incorporated into the financial report based on
historical knowledge and best available current
information. Estimates assume a reasonable
expectation of future events and are based on
current trends and economic data, obtained both
externally and within the Group.
Key estimates – impairment
The Group assesses impairment at each reporting
date by evaluating conditions specific to the Group
that may lead to impairment of assets. Where an
impairment trigger exists, the recoverable amount
of the asset is determined. Where applicable,
value-in-use calculations performed in assessing
recoverable amounts incorporate a number of key
estimates.
Key judgments – exploration & evaluation assets
The Group performs regular reviews on each area
of interest to determine the appropriateness of
continuing to carry forward costs in relation to
that area of interest. These reviews are based on
detailed surveys and analysis of drilling results
performed to balance date.
NOTE 2. REVENUE
- Interest received
- Other revenue
Total Revenue
(a) Interest revenue from:
- At call deposits held with financial institutions
Total Interest Revenue
The Directors have assessed that for the
exploration and evaluation assets recognised at
30 June 2015, the facts and circumstances do not
suggest that the carrying amount of an asset may
exceed its recoverable amount. In considering
this the Directors have had regard to the facts
and circumstances that indicate a need for an
impairment as noted in Accounting Standard
AASB 6 “Exploration for and Evaluation of Mineral
Resources”.
Exploration and evaluation assets at 30 June 2015
were $3,117,009 (2014: $1,590,815).
Key judgments – share based payment transactions
The Group measures the cost of equity settled
transactions with employees by reference to the
fair value of the equity instruments at the date at
which they are granted. The fair value is determined
by using the Black-Scholes model taking into
account the terms and conditions upon which
the instruments were granted. The accounting
estimates and assumptions relating to equity settled
share based payments would have no impact on the
carrying amounts of assets and liabilities within the
next annual reporting period but may impact the
profit or loss and equity.
2015
2014
$
$
916
2,221
-
-
916 2,221
916
2,221
916 2,221
ANNUAL REPORT 2015
48
Notes to the Financial StatementsFor the year ended 30 June 2015
NOTE 3. PROFIT / (LOSS)
Included in the profit / (loss) are the following specific expenses:
Depreciation
- Office equipment
- Plant & equipment
Defined contributions superannuation expense
Foreign exchange (gains) losses
NOTE 4. INCOME TAX
(a) Components of income tax expense (benefit)
Income tax expense (benefit) is made up of:
Current tax
Deferred tax
(b) The prima facie tax on profit / (loss) before income tax is
reconciled to the income tax expense as follows:
2015
2014
$
$
749
800
3,281
3,584
1,502
(236,954)
-
42
2015
2014
$
-
-
$
-
-
Prima facie tax on profit / (loss) before income tax at 30% (2014: 30%)
(611,422)
(731,230)
Add tax effect of:
Permanent differences
Current tax loss not recognised
Current year temporary difference not recognised
Deferred tax not recognised
Other items
Income tax expense
Deferred Tax Asset (at 30%)
Recognised temporary differences
Recognised Unused tax losses
Capital raising costs
Total deferred tax assets recognised
Deferred Tax Liability
Recognised timing differences
Net deferred tax recognised
Unrecognised deferred tax assets comprised of:
Deferred tax assets: Net unrecognised tax losses
Deferred tax assets: Gross unrecognised tax losses
49
ANNUAL REPORT 2015
-
457,643
153,779
-
-
-
7,500
159,346
76,159
243,005
237,032
494,198
-
-
-
-
21,870
185,958
-
207,828
(243,005)
(207,828)
-
-
2,198,689
5,848,410
1,704,630
5,682,100
Notes to the Financial StatementsFor the year ended 30 June 2015
NOTE 4. INCOME TAX (CONTINUED)
In order to recoup carried forward losses in future periods, either the Continuity of Ownership Test (COT) or Same
Business Test must be passed. The majority of losses are carried forward at 30 June 2015 under COT.
Deferred tax assets which have not been recognised as an asset, will only be obtained if:
(i)
the Company derives future assessable income of a nature and of an amount sufficient to enable the losses to
be realised;
(ii) the Company continues to comply with the conditions for deductibility imposed by the law; and
(iii) no changes in tax legislation adversely affect the Company in realising the losses.
NOTE 5: KEY MANAGEMENT PERSONNEL
The total remuneration of Key Management Personnel for the Group for the year was as follows:
Short term employee benefits
Post-employment benefits
Share based
payments
Total
2015
$
793,582
-
-
793,582
2014
$
282,500
-
778,016
1,060,516
Refer to the Remuneration Report contained in the Directors’ Report for details of the remuneration paid or
payable to each member of the Group’s Key Management Personnel.
NOTE 6. DIVIDENDS AND FRANKING CREDITS
There were no dividends paid or recommended during the year or since the end of the year. There are no
NOTE 7. AUDITORS REMUNERATION
Amounts received or due and receivable by BDO (Australia)
An audit or review of the financial report of
the entity or any other entity in the consoli-
dated group
Other services in relation to the entity and
any other entity in the consolidated group
Tax compliance
Assurance related
Amounts received or due and receivable by
BDO (Overseas)
Other services in relation to the
entity and any other entity in the
consolidated group
Assurance related
Total
2015
$
25,000
-
54,850
79,850
140,653
220,503
2014
$
29,000
-
-
-
-
29,000
ANNUAL REPORT 2015
50
Notes to the Financial StatementsFor the year ended 30 June 2015
NOTE 8. LOSS PER SHARE (EPS)
(a) Loss
Loss used to calculate basic and diluted EPS
(b) Weighted average number of shares and options
Weighted average number of
ordinary shares outstanding during the year, used in
calculating basic loss per share
Weighted average number of
dilutive options outstanding during the year
Weighted average number of ordinary shares and potential
ordinary shares outstanding during the year, used in
calculating diluted loss per share
2015
$
2014
$
(2,038,074)
(2,425,279)
Number of Shares
Number of Shares
175,002,292
121,978,246
-
-
175,002,292
121,978,246
The options are considered non-dilutive as they were out of the money. Options may become dilutive in
the future.
NOTE 9. CASH AND CASH EQUIVALENTS
Cash at bank
Total
NOTE 10. TRADE AND OTHER RECEIVABLES
GST refundable
Total
2015
$
14,947,231
14,947,231
2015
$
36,154
36,154
2014
$
27,600
27,600
2014
$
29,424
29,424
Receivables are non-interest bearing and are generally on 30-60 day terms. A provision for impairment loss is
recognised when there is objective evidence that an individual receivable is impaired. No impairment loss has been
recorded for the current and previous financial year.
Due to the short term nature of these receivables, their carrying value is assumed to approximate fair value. The
maximum exposure to credit risk is the carrying value of receivables. Collateral is not held as security.
The receivables are not exposed to foreign exchange risk. No receivables were past due or impaired at 30 June 2015
(2014: nil).
51
ANNUAL REPORT 2015
Notes to the Financial StatementsFor the year ended 30 June 2015
NOTE 11. OTHER FINANCIAL ASSETS – NON-CURRENT
Security deposits
Investment in shares at cost
Total
NOTE 12. PROPERTY, PLANT AND EQUIPMENT
Plant & Equipment
– at cost
Accumulated
depreciation
Written down value
Office equipment
– at cost
Accumulated
depreciation
Written down value
Total written down value
2015
$
49,666
4,000
53,666
2015
$
32,815
(25,802)
7,013
4,189
(2,434)
1,755
8,768
Reconciliation of carrying amounts at the beginning and of the year
Plant & Equipment
Office Equipment
Year ended 30 June 2015
At 1 July 2014 net of
accumulated depreciation
Additions
Disposals
Depreciation charge for the year
At 30 June 2015 net of
accumulated depreciation
Year ended 30 June 2014
At 1 July 2013 net of
accumulated depreciation
Additions
Disposals
Depreciation charge for the year
At 30 June 2014 net of
accumulated depreciation
$
10,294
-
-
(3,281)
7,013
13,878
-
-
(3,584)
10,294
$
716
1,788
-
(749)
1,755
1,516
-
-
(800)
716
2014
$
59,103
4,000
63,103
2014
$
32,815
(22,521)
10,294
2,401
(1,685)
716
11,010
Total
$
11,010
1,788
-
(4,030)
8,768
15,394
-
-
(4,384)
11,010
ANNUAL REPORT 2015
52
Notes to the Financial StatementsFor the year ended 30 June 2015
NOTE 13. EXPLORATION AND EVALUATION ASSETS
Exploration and evaluation assets
Movements in carrying amounts
Balance at the
beginning of the year
Additions
Written-off during the year
Balance at the end of the year
2015
$
3,117,009
1,590,815
1,574,184
(47,990)
3,117,009
2014
$
1,590,815
1,021,370
579,518
(10,073)
1,590,815
The recoverability of the carrying amount of exploration and evaluation assets is dependent on the
successful development and commercial exploitation or alternatively, sale of the respective areas of
interest.
NOTE 14. TRADE AND OTHER PAYABLES
Trade payables
Accrued expenses
2015
$
162,261
116,779
279,040
2014
$
1,262,164
31,667
1,293,831
Trade payables are non-interest bearing and are generally on 30-60 day terms.
Due to the short term nature of these payables, their carrying value is assumed to approximate fair value.
NOTE 15. ISSUED CAPITAL
(a) Issued And Paid-Up Capital
236,612,203 (2014: 135,907,155) ordinary
shares fully paid
Share issue costs
2015
$
26,485,820
(708,092)
25,777,728
2014
$
6,732,547
(71,289)
6,661,258
Ordinary shares participate in dividends and the proceeds on winding up the Company in proportion to the
number of shares held. At shareholder meetings each ordinary share is entitled to one vote when a poll is
called, otherwise each shareholder has one vote on a show of hands.
53
ANNUAL REPORT 2015
Notes to the Financial StatementsFor the year ended 30 June 2015
NOTE 15. ISSUED CAPITAL (CONTINUED)
(b) Reconciliation Of Issued And Paid-Up Capital
At 1 July 2013
Shares issued for cash ($0.075 per share – 01/07/13)
Shares issued for cash ($0.075 per share – 29/10/13)
Shares issued for debt conversion ($0.075 per share – 20/12/13)
Shares issued for services in lieu of cash ($0.075 per share – 20/12/13)
Shares issued for issue costs lieu of cash ($0.075 per share – 20/12/13)
Bonus shares issued ($0.075 per share – 20/12/13)
Shares issued for cash ($0.08 per share – 20/12/13 net of issue costs)
Bonus shares issued ($0.08 per share – 31/01/14)
Shares issued for cash ($0.08 per share – 31/01/14 net of issue costs)
Shares issued for cash ($0.08 per share – 04/03/14
At 30 June 2014
At 1 July 2014
Shares issued for cash (US$0.12 per share, equivalent to $0.138 per share –
24/11/14)
Shares issued for cash (£0.10 per share, equivalent to $0.20 per share – 11/02/15,
net of share issue costs)
At 30 June 2015
(c) Options
Number of Shares
105,934,013
720,000
7,933,333
1,333,333
2,700,000
196,000
5,370,000
4,327,976
2,690,000
809,167
3,893,333
135,907,155
135,907,155
4,166,666
$
4,391,686
54,000
595,000
100,000
202,500
14,700
402,750
322,379
215,200
51,576
311,467
6,661,258
6,661,258
574,618
96,538,382
18,541,852
236,612,203
25,777,728
As at 30 June 2015, there were 13,270,000 unissued ordinary shares of IronRidge Resources Limited under
option held as follows:
• 13,270,000 unlisted options to take up one ordinary share in IronRidge Resources Ltd at an exercise price of
£0.10. The options vested immediately and expire 31 December 2017.
(d) Capital Risk Management
When managing capital, management’s objective is to ensure the entity 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 to ensure the lowest costs of capital available to the Group.
The Group’s capital comprises equity as shown in the statement of financial position. The Group is not
exposed to externally imposed capital requirements.
ANNUAL REPORT 2015
54
Notes to the Financial StatementsFor the year ended 30 June 2015
NOTE 16. SHARE BASED PAYMENTS
The expense recognised for share based payments received during the year is shown in the table below:
Expense arising
from equity settled share-based payment
transactions
Bonus share issues
2015
$
-
2014
$
789,661
During the year ended 30 June 2014, IronRidge Resources issued 8,060,000 shares to directors and key
management personnel totaling $617,950. No such share issues occurred during the year ended 30 June 2015.
Employee share option plan (ESOP)
Share options are granted to employees. The employee share option plan is designed to align participants’ interests
with those of shareholders by increasing the value of the Company’s shares.
When a participant ceases employment after the vesting of their share options, the share options are forfeited after
90 days unless cessation of employment is due to termination for cause, whereupon they are forfeited immediately or
death. The Company prohibits KMP from entering into arrangements to protect the value of unvested ESOP awards.
Each option can be exercised from vesting date to expiry date for one share with the exercise price payable in cash.
Options granted
On 31 January 2014, 13,270,000 IronRidge Resources Ltd share options were granted to Directors and employees
under the Employee Share Option Plan. The options are to take up one ordinary share in IronRidge Resources at the
initial public offering price. The options vested immediately and are due to expire on 31 December 2017. The following
table illustrates the number (no.) and weighted average exercise prices (WAEP) of, and movements in, share based
payment share options granted during the year:
55
ANNUAL REPORT 2015
Notes to the Financial StatementsFor the year ended 30 June 2015
NOTE 16. SHARE BASED PAYMENTS (CONTINUED)
Outstanding at the beginning of the year
13,270,000
2015
No.
Granted during the year
Forfeited during the year
Exercised during the year
Expired during the year
-
-
-
-
Outstanding at the end of the year
Exercisable at the end of the year
13,270,000
13,270,000
2015
WAEP
£0.10
-
-
-
-
£0.10
£0.10
2014
No.
-
13,270,000
-
-
13,270,000
13,270,000
2014
WAEP
-
£0.10
-
-
£0.10
£0.10
The weighted average remaining contractual life of the options was 2.5 years (2014: 3.5 years).
The options were granted before the initial public offering (IPO). At the time of grant, the IPO price was expected to
be 25 pence and accordingly this was used at the weighted average exercise price to value the options. A value of
$171,711 was calculated using the Black Scholes valuation methodology
IronRidge Resources Ltd (ESOP)
Weighted average exercise price
Weighted average life of the option
Underlying share price
Expected share price volatility
Risk free interest rate
Number of options issued
Fair value (black-scholes) per option
Total value of options issued
2015
-
-
-
-
-
-
-
-
2014
£0.25
3.92 years
£0.042
72.736%
1.78%
13,270,000
£0.007
$171,711
ANNUAL REPORT 2015
56
Notes to the Financial StatementsFor the year ended 30 June 2015
NOTE 17. ACCUMULATED LOSSES
Accumulated losses at the beginning of the year
Losses after income tax expense
Accumulated losses attributable to members of IronRidge Resources
Limited at the end of the year
2015
$
(6,027,577)
(2,038,074)
(8,065,651)
NOTE 18. INFORMATION RELATING TO IRONRIDGE RESOURCES
LIMITED (“THE PARENT ENTITY”)
Current assets
Total assets
Current liabilities
Total liabilities
Net Assets
Issued capital
Share based payment reserve
Accumulated losses
Loss of the parent entity
Total comprehensive loss of
the parent entity
2015
$
14,983,457
19,220,235
257,064
499,277
18,720,958
25,777,728
171,711
(7,228,480)
(2,034,079)
(2,034,079)
2014
$
(3,602,298)
(2,425,279)
(6,027,577)
2014
$
523,171
3,178,340
1,539,772
1,539,772
1,638,568
6,661,258
171,711
(5,194,401)
(2,417,487)
(2,417,487)
The parent does not have any guarantees in relation to the debts of its subsidiaries, contingent liabilities or contractual
obligations to purchase fixed assets at 30 June 2015 (2014: nil).
57
ANNUAL REPORT 2015
Notes to the Financial StatementsFor the year ended 30 June 2015
NOTE 19. CASH FLOW RECONCILIATION
Loss after income tax
Non-cash operating items
-
-
-
-
Write back of exploration expenditure
Depreciation
Share based payments
IPO costs expensed
Changes in operating assets and liabilities*
(Increase) decrease in trade and other receivables
(Increase) decrease in othercurrent assets
Increase (decrease) in trade and other payables*
Net cash flows from operating activities
*Net of amounts relating to exploration and evaluation assets.
Non-cash investing and financing activities
2015
$
2014
$
(2,038,074)
(2,425,279)
47,990
4,030
-
-
(6,729)
386,476
(228,233)
10,073
4,383
789,661
518,453
(4,899)
(386,476)
812,636
(1,379,074)
(681,448)
During the year ended 30 June2014, $100,000 of the loan owing by IronRidge Resources Limited to DGR Global
Limited was converted to equity in IronRidge. In addition, a further $217,200 of liabilities were settled by issue of equity
(refer note 15).
NOTE 20. RELATED PARTY DISCLOSURES
(a) Subsidiaries
The consolidated financial statements include the financial statements of IronRidge Resources Limited and the
subsidiaries listed in the following table:
Name
Eastern Exploration Pty Ltd
Quiver Coal Pty Ltd
IronRidge Botswana Pty Ltd
IronRidge Gabon SA
(b) Ultimate Parent
Country of Incorporation
Australia
Australia
Botswana
Gabon
Equity Interest (%)
2015
2014
100
100
100
100
100
100
100
100
IronRidge Resources Limited is the ultimate parent, which is incorporated in Australia. DGR Global Ltd ceased
being the ultimate parent entity on 12 February 2015 following the IPO of IronRidge Resources Limited.
(c) Key Management Personnel
Details relating to key management personnel, including remuneration paid, are included in the directors’
report and note 5.
ANNUAL REPORT 2015
58
Notes to the Financial StatementsFor the year ended 30 June 2015
NOTE 20. RELATED PARTY DISCLOSURES (CONTINUED)
(d) Transactions With Related Parties
The following table provides the total amount of transactions that were entered into with related parties for the
relevant financial year:
Related Party
DGR Global Limited (i)
Hopgood Ganim Lawyers (ii)
Sales to Related
Parties
Purchases from
Related Parties
Other Transactions with
Related Parties
2015
2014
2015
2014
-
-
-
-
288,000
288,000
214,108
260,185
-
-
-
-
(i) The Company has a commercial arrangement with DGR Global Limited for the provision of various
services, whereby DGR Global Limited provides resources and services including the provision of
its administration and exploration staff, its premises (for the purposes of conducting the Company’s
business operations), use of existing office furniture, equipment and certain stationery, together with
general telephone, reception and other office facilities (‘‘Services’’). In consideration for the provision
of the Services, the Group pays DGR Global Limited a monthly management fee. For the year ended
30 June 2015, $288,000 was paid or payable to DGR Global Limited (2014: $288,000) for the provision of
the Services. The total amount outstanding at year end was $40,913 (2014: $72,000).
(ii) Mr Brian Moller (a Director of the former ultimate parent entity DGR Global Ltd), is a partner in the
Australian firm Hopgood Ganim lawyers. For the year ended 30 June 2015, $214,108 was paid or
payable to Hopgood Ganim (2014: $260,185) for the provision of legal services to the Group. The
services were based on normal commercial terms and conditions. The total amount outstanding at
year end was $3,297 (2014: $257,639).
The outstanding balances at each relevant year end are unsecured, interest free and settlement occurs in cash.
All outstanding amounts payable comprise current liabilities.
(e) Loans From Related Parties
During the year ended 30 June 2014, a loan of $97,615 was advanced from DGR Global Limited to IronRidge
Resources Limited. During 2014 $8,546 was repaid in cash and $100,000 was converted to equity resulting in
a $9,205 balance owing at 30 June 2014. The loan was unsecured and payable at call, however DGR Global
Limited had provided a letter of comfort to the Group acknowledging that the loan will only be payable on the
earlier of IronRidge Resources Limited obtaining sufficient working capital to warrant repayment, DGR Global
Limited and IronRidge Resources Limited agreeing to convert some or all of the loan to equity in the Group or
the expiry of twelve months from the balance date.
NOTE 21. CAPITAL COMMITMENTS
Future Exploration Commitments
The Group has certain obligations to expend minimum amounts on exploration in tenement areas. These
obligations may be varied from time to time and are expected to be fulfilled in the normal course of operations
of the Group. The commitments are as follows:
Less than 12 months
Between 12 months and 5 years
59
ANNUAL REPORT 2015
2015
$
13,405,048
3,094,808
2014
$
7,696,990
9,876,000
16,499,856
17,572,990
Notes to the Financial StatementsFor the year ended 30 June 2015
NOTE 21. CAPITAL COMMITMENTS (CONTINUED)
To keep tenements in good standing, work
programs should meet certain minimum expenditure
requirements. If the minimum expenditure
requirements are not met, the Group has the option
to negotiate new terms or relinquish the tenements.
The Group also has the ability to meet expenditure
requirements by joint venture or farm-in agreements.
NOTE 22. FINANCIAL RISK MANAGEMENT
(a) General Objectives, Policies And Processes
In common with all other businesses, the Group is
exposed to risks that arise from its use of financial
instruments. This note describes the Group’s
objectives, policies and processes for managing those
risks and the methods used to measure them. Further
quantitative information in respect of these risks is
presented throughout these financial statements.
There have been no substantive changes in the
Group’s exposure to financial instrument risks, its
objectives, policies and processes for managing those
risks or the methods used to measure them from
previous years unless otherwise stated in this note.
The Group’s financial instruments consist mainly of
deposits with banks, receivables and payables.
The Board has overall responsibility for the
determination of the Group’s risk management
objectives and policies and, whilst retaining ultimate
responsibility for them, it has delegated the authority
for designing and operating processes that ensure
the effective implementation of the objectives and
policies to the Group’s finance function. The Group’s
risk management policies and objectives are therefore
designed to minimise the potential impacts of these
risks on the results of the Group where such impacts
may be material.
The overall objective of the Board is to set polices
that seek to reduce risk as far as possible without
unduly affecting the Group’s competitiveness and
flexibility. Further details regarding these policies
are set out below:
(b) Credit Risk
Credit risk is the risk that the other party to a financial
instrument will fail to discharge their obligation
resulting in the Group incurring a financial loss.
This usually occurs when debtors fail to settle their
obligations owing to the Group. The Group’s
objective is to minimise the risk of loss from credit
risk exposure.
The maximum exposure to credit risk, excluding the
value of any collateral or other security, at balance
date to recognised financial assets, is the carrying
amount, net of any provisions for impairment of those
assets, as disclosed in the statement of financial
position and notes to the financial statements.
Credit risk is reviewed regularly by the Board. It
arises from exposure to receivables as well as through
deposits with financial institutions and available-for-
sale financial assets.
The Group does not have any material credit risk
exposure to any single debtor or group of debtors
under financial instruments entered into by the Group
and at balance date.
Bank deposits are held with Macquarie Bank Limited,
Westpac Banking Corporation Limited and B.I.C.I.
Du Gabon.
(c) Liquidity Risk
Liquidity risk is the risk that the Group may encounter
difficulties raising funds to meet financial obligations
as they fall due. The objective of managing liquidity
risk is to ensure, as far as possible, that the Group will
always have sufficient liquidity to meets its liabilities
when they fall due, under both normal and stressed
conditions.
Liquidity risk is reviewed regularly by the Board.
The Group manages liquidity risk by monitoring
forecast cash flows and liquidity ratios such as working
capital. The Group did not have any financing
facilities available at balance date.
(d) Market Risk
Market risk arises from the use of interest bearing,
tradable and foreign currency financial instruments.
It is the risk that the fair value or future cash flows of a
financial instrument will fluctuate because of changes
in interest rates (interest rate risk), foreign exchange
rates (currency risk) or other market factors (other
price risk). The Group does not have any material
exposure to market risk other than interest rate risk.
ANNUAL REPORT 2015
60
Notes to the Financial StatementsFor the year ended 30 June 2015
NOTE 22. FINANCIAL RISK MANAGEMENT (CONTINUED)
Interest rate risk
Interest rate risk arises principally from cash and cash equivalents. The objective of interest rate risk
management is to manage and control interest rate risk exposures within acceptable parameters while
optimising the return.
Foreign currency risk
Foreign currency risk is that the risk that the fair value of future cash flows of a financial instrument will fluctuate
because of changes in foreign exchange rates. The Group’s exposure to the risk of changes in foreign
exchange rates relates primarily to the Group’s bank deposits held in British Sterling Pound and the United
States Dollar.
The Group manages its foreign currency risk by matching as best as possible its foreign exploration spends
with the foreign currency it holds.
Interest rate risk is managed with a mixture of fixed and floating rate debt. For further details on interest rate
risk refer to the tables below:
Floating
Interest Rate
Fixed
Interest Rate
Non-Interest
Bearing
Total Carrying
Amount as per the
Balance Sheet
Weighted
Average Effective
Interest Rate
2015
$
2015
$
(i) Financial assets
Cash and cash equivalents
14,947,231
Trade and other receivables
Other financial assets
-
-
Total financial assets
14,947,231
(ii) Financial liabilities
Trade and other payables
Non-interest-bearing loans
Total financial liabilities
-
-
-
-
-
-
-
-
-
-
2015
$
-
36,154
53,666
89,820
279,040
-
2015
$
2015
%
14,947,231
1.65%
36,154
53,666
15,037,051
279,040
-
-
-
-
-
279,040
279,040
61
ANNUAL REPORT 2015
Notes to the Financial StatementsFor the year ended 30 June 2015
NOTE 22. FINANCIAL RISK MANAGEMENT (CONTINUED)
Floating
Interest Rate
Fixed
Interest Rate
Non-Interest
Bearing
Total Carrying
Amount as per the
Balance Sheet
Weighted
Average Effective
Interest Rate
2014
$
27,600
-
-
27,600
-
-
2014
$
-
-
-
-
-
-
2014
$
-
29,424
63,103
92,527
2014
$
27,600
29,424
63,103
120,127
1,293,831
1,293,831
9,205
9,205
1,303,036
1,303,036
2014
%
0.01%
-
-
-
-
(i) Financial assets
Cash and cash equivalents
Trade and other receivables
Other financial assets
Total financial assets
(ii) Financial liabilities
Trade and other payables
Non-interest-bearing loans
Total financial liabilities
The table below demonstrates the sensitivity to a reasonably possible change in the United States dollar and
the British sterling pound against the Australian dollar.
Change in US Dollar Rate
Effect on Profit Before Tax
2015
2014
2015
2014
+10%
-5%
+10%
-5%
$
219,852
(109,926)
-
-
Change in British
Sterling Pound Rate
Effect on Profit Before Tax
+5%
-5%
+5%
-5%
$
290,979
(290,979)
-
-
ANNUAL REPORT 2015
62
NOTE 23. OPERATING SEGMENTS
Notes to the Financial StatementsFor the year ended 30 June 2015
The Group has identified its operating segment based on the internal reports that are reviewed and used
by the Board of Directors (chief operating decision makers) in assessing performance and determining the
allocation of resources. The Group is managed primarily on a geographic basis, that is, the location of the
respective areas of interest (tenements) in Queensland, and Gabon. Operating segments are determined
on the basis of financial information reported to the Board for the Group as a whole. The Group does not
yet have any products or services from which it derives an income.
Accordingly, management currently identifies the Group as having only one reportable segment, being
exploration for base and precious metals. The financial results from this segment are equivalent to the
financial statements of the Group. There have been no changes in the operating segments during the year.
Geographical information
Geographical – Non-Current Assets
Australia
Gabon
2015
$
946,850
2,232,593
3,179,443
2014
$
841,273
823,655
1,664,928
NOTE 24. SUBSEQUENT EVENTS
The Directors are not aware of any significant changes in the state of affairs of the Group or events after the
balance date that would have a material impact on the consolidated financial statements.
NOTE 25. CONTINGENT ASSETS AND LIABILITIES
There are no contingent assets and liabilities at 30 June 2015 (2014: nill).
63
ANNUAL REPORT 2015
Notes to the Financial StatementsFor the year ended 30 June 2015
Directors’ Declaration
In accordance with a resolution of the Directors of IronRidge Resources Limited, I state that:
1.
In the opinion of the Directors:
(a)
The financial statements and notes of IronRidge Resources Limited for the financial
year ended 30 June 2015 are in accordance with the Corporations Act 2001, including:
(i)
(ii)
Giving a true and fair view of its financial position as at 30 June 2015
and performance
Complying with the Accounting Standards (including the Australian
Accounting Interpretations) and the Corporations Regulations 2001
(b)
(c)
(d)
The financial statements and notes also comply with International Financial Reporting
Standards as disclosed in Note 1
There are reasonable grounds to believe that the Company will be able to pay its
debts as and when they become due and payable
The remuneration disclosures contained in the Remuneration Report comply with
s300A of the Corporations Act 2001.
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
ended 30 June 2015.
On behalf of the board
Vincent Mascolo
Managing Director and CEO
Brisbane
Date: 29 September 2015
ANNUAL REPORT 2015
64
Independent
Auditors’Report
BDO Audit Pty Ltd ABN 33 134 022 870 is a member of a national association of independent entities which are all members of
BDO Australia Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit Pty Ltd and BDO Australia Ltd
are members of BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of
independent member firms. Liability limited by a scheme approved under Professional Standards Legislation, other than for the
acts or omissions of financial services licensees.
65
ANNUAL REPORT 2015
BDO Audit Pty Ltd ABN 33 134 022 870 is a member of a national association of independent entities which are all members of
BDO Australia Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit Pty Ltd and BDO Australia Ltd
are members of BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of
independent member firms. Liability limited by a scheme approved under Professional Standards Legislation, other than for the
acts or omissions of financial services licensees.
ANNUAL REPORT 2015
66
Independent Auditors’Report
67
ANNUAL REPORT 2015
ANNUAL REPORT 2015
68
IRONRIDGE RESOURCES LIMITED
AND CONTROLLED ENTITIES
ACN: 127 215 132
1
ANNUAL REPORT 2015