JUPITER MINES LIMITEDABN 51 105 991 740
Suite 3, Level 42, 108 St Georges Terrace, Perth, WA, 6000
Ph: 08 9346 5500 Fax: 08 9481 5933 Email: info@jupitermines.com
29th September 2011
The Manager
Company Announcements Office
Australian Stock Exchange Limited
Level 4, 20 Bridge Street
SYDNEY NSW 2000
Via ASX Online
RE: Annual Report 2011
Please find attached the Annual Report for Jupiter Mines Limited for the year ending 30th June 2011.
For and on behalf of the Directors of Jupiter Mines Limited.
Matt Finkelstein
Company Secretary & CFO
Jupiter Mines Limited
annual report 2011
Jupiter Mines Limited
corporate Directory
Jupiter Mines Limited shares are listed on the Australian Securities Exchange (ASX). The ASX code is JMS.
Directors
Brian Gilbertson
(Non-executive Chairman)
Paul Murray
(Non-executive Director)
Priyank Thapliyal
(Non-executive Director)
Mr Sun Moon Woo
(Non-executive Director)
Andrew Bell
(Non-executive Director)
Richard Mehan
(Managing Director and Chief Executive Officer)
eXecUtiVes
Greg Durack
Chief Operating Officer
Matt Finkelstein
Company Secretary and Chief Financial Officer
Principal Office
Suite 3, Level 42
108 St Georges Terrace
Perth WA 6000
Telephone: (08) 9346 5500
(08) 9481 5933
Facsimile:
info@jupitermines.com
Email:
Share Registry
Link Market Services
Ground Floor, 178 St Georges Terrace
Perth WA 6000
Telephone: 1300 554 474
(02) 9287 0303
Fax:
registrars@linkmarketservices.com.au
Email:
www.linkmarketservices.com.au
Website:
Independent Auditors
Grant Thornton
Level 1, 10 Kings Park Road
West Perth WA 6005
Telephone: (08) 9480 2000
(08) 9322 7787
Facsimile:
admin@gtwa.com.au
Email:
www.grantthornton.com.au
Website:
www.jupitermines.com
annual report 2011 JUPITER MINES LIMITED
CONTENTS
Chairman’s Letter
Review of Operations
Corporate Governance Statement
Directors’ Report
Auditor’s Independence Declaration
Statement of Comprehensive Income
Statement of Financial Position
Statement of Changes in Equity
Statement of Cash Flows
Notes to the Financial Statements
Directors’ Declaration
Independent Audit Report
Additional Information for Listed Companies
2
4
16
20
34
35
36
37
38
39
85
86
89
1
JUPITER MINES LIMITED annual report 2011
CHAIRMANS LETTER
Dear Shareholders,
I am pleased to present this review of the activities of the company during the financial year ended 30th June 2011.
The past year continued our strong focus on implementing the steel feed strategy, with construction commencing on the
Tshipi Manganese Project, feasibility studies on the Central Yilgarn Iron Projects underway, and further key management
appointments at the Company.
I was re-elected as Chairman on October 8th 2010.
On May 9th 2011 Richard Mehan joined the Company as Managing Director and Chief Executive Officer. Richard
previously worked in a number of senior mining roles including President & Chief Executive Officer Asia Pacific for Cliffs
Natural Resources and Managing Director of Portman Ltd. On the same day Greg Durack assumed the position of Chief
Operating Officer. On June 15th 2011 Matt Finkelstein joined as the Company’s Chief Financial Officer and Company
Secretary.
On July 6th 2010 a notice of meeting for an EGM in relation to the Tshipi transaction was advised and an independent
experts report released. Mining rights were granted to Tshipi on September 6th 2010 and, on October 29th 2010 the
Tshipi transaction was completed. Approval to commence project construction was given on February 7th 2011 and
development is now underway. Manganese ore is scheduled to be available for shipment in the second half of 2012.
The Company has been very active in progressing the Central Yilgarn Iron Projects (CYIP).
An 11000 meter drill program was undertaken during the year to test the Mount Ida magnetite exploration target. As
announced the drilling program resulted in a maiden inferred resource of 530 million tonnes at 31.94% Fe in the projects
central zone.
Scoping studies were then undertaken on both the Mount Ida magnetite project and the Mount Mason DSO hematite
project both of which delivered robust economic outcomes.
Your Board subsequently approved the undertaking of Definitive Feasibility Studies (DFS) on both projects, and major
study consultants were appointed in July, 2011.
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annual report 2011 JUPITER MINES LIMITED
Capital raisings at end January and in April raised A$150 million to fund Jupiter’s share of Tshipi construction costs and
the CYIP feasibility studies.
The aggressive development program is focussed on a very busy year ahead, targetting production from the Tshipi project,
completion of the Mount Mason DFS and significant progress on the Mount Ida DFS.
We will continue to make appropriate additions to the Jupiter management team to support these initiatives and I look
forward to providing shareholders with updated information on progress during the year ahead.
Yours Faithfully
Jupiter Mines Limited
Brian P Gilbertson
Chairman
3
JUPITER MINES LIMITED annual report 2011
REVIEW OF OPERATIONS
Jupiter Mines Limited (“Jupiter” or the “Company”) continued to focus on the development of its iron and manganese
projects in pursuit of its long term Steel Feed Corporation (“SFC”) strategy.
Significant progress was achieved during the year across the Company’s major project areas in Australia, at the Central
Yilgarn Iron Project (“CYIP”) and in South Africa at the Tshipi Kalahari Manganese Project (“Tshipi Project”).
Following success in these core projects, Jupiter is set to evolve from an exploration company to a mine development
and producing entity.
CENTRAL YILGARN IRON PROJECT
Mount Ida and Mount Mason
The Central Yilgarn Iron Project (“CYIP”) area is located 130km by road northwest of the town of Menzies, where an iron
ore storage and load out facility is planned to access the Brookfield Rail Leonora to Kalgoorlie railway line and the Port
of Esperance for export (Figure 1). Jupiter’s CYIP will have reduced capital expenditure requirements compared to a
greenfields development as a result of being able to access an existing railway and port. Capital contributions will be
required to utilise and upgrade the existing infrastructure.
Figure 1 - Central Yilgarn Iron Project Location Map
Jupiter substantially progressed the CYIP during the year with testing on the Mount Ida central zone delivering a maiden
inferred resource of 530 million tonnes at 31.94% Fe. Scoping Studies were completed on both the Mount Ida Magnetite
Project and the Mount Mason DSO Hematite Project by ProMet Engineers (ProMet), with both studies demonstrating
financially robust projects. The Jupiter Board subsequently approved the undertaking of feasibility studies for each
project, to be run in parallel. Approximately 90,000 metres of drilling (RC 79,000 metres and diamond 11,000 metres)
will be required to complete the studies. The drilling programme is scheduled to run over 12 months and is due to be
completed by July 2012.
4
annual report 2011 JUPITER MINES LIMITED
A forty man exploration camp was constructed in April 2011 as well as a core and sample handling shed to facilitate the
program. Drilling contracts were awarded, and a total of five drill rigs commenced mobilising to site in mid May 2011. As
at 30 June 2011 8,403 meters have been drilled (RC 6,446 metres and diamond 1,957 metres).
Major consultants for the feasibility studies were evaluated and selected during the September 2011 quarter. The targeted
completion timeline of the Mount Mason and Mount Ida feasibility studies are the March and December quarters of 2012
respectively.
Figure 2 - Camp Cassini Dry Mess Open Deck
MOUNT IDA MAGNETITE PROJECT
Figure 3 - Core and Sample Shed
The flagship Mount Ida Magnetite Project has the potential to be a world class magnetite project with substantial life of
project creating significant positive cash flows further establishing Jupiter in the Central Yilgarn region.
In the second half of 2010 an 11,898 metre RC drill program was completed. The program targeted the Central Zone within
the conceptual exploration target of 1.1-1.3 billion tonnes of magnetite with an expected grade of between 30 to 40% Fe.
The potential quantity and grade of the Mount Ida project is conceptual in nature and there has been insufficient drilling
to define a Mineral Resource and it is uncertain if further exploration will result in the determination of a Mineral Resource.
5
JUPITER MINES LIMITED annual report 2011
REVIEW OF OPERATIONS
The drill program was completed mid December 2010, with the initial maiden inferred resource of 530 million tonnes at
31.94% Fe announced to the market on 19 January 2011. This initial resource exceeded expectations; the geological
model previously indicating approximately 400 million tonnes would likely be delivered from the Central Zone. Given the
Central Zone represents only 30% of the magnetite mineralization strike length of the exploration target, there is significant
potential for Mount Ida to be a substantial magnetite project.
Figure 4 - Mount Ida Inferred Mineral Resource (Central Zone)
Jupiter further announced on the 18 March 2011 that a Scoping Study on Mount Ida had been completed by ProMet
Engineers Pty Ltd (“ProMet”). The Scoping Study, which was based on the Mount Ida inferred resource of 530 million
tonnes, indicated a financially robust magnetite operation. The Scoping Study assumed an open pit contract mining
operation extracting 25mtpa run of mine (ROM) ore to produce 10mtpa of high grade magnetite concentrate, with an iron
grade in excess of 68% Fe, a silica content of 4.5% and very low levels of impurities (sulphur, phosphorous and alumina).
An average 43.4% weight recovery was calculated based on test work already completed. The Base Case for the Scoping
Study assumed that the magnetite concentrate would be railed from Mount Ida to a site south of Menzies where the
concentrate would be dewatered, filtered and loaded onto trains for transportation to the Port of Esperance. This Base
Case scenario further assumed that power would be provided out of Menzies by a third party utilising gas as the prime
power source. Given the high grade and quality of the concentrate, Jupiter anticipates the concentrate would achieve a
premium to benchmark iron ore prices.
The Scoping Study, based on the above assumptions, estimated capital costs of the project to be $1,583 million and cash
operating costs of $62.78 per tonne of magnetite concentrate produced. Using 100% equity financing, ignoring taxation,
and assuming a concentrate value of US$110 per tonne and a 5% concentrate royalty, the Project generates an NPV of
$1,685 million @ an 8% pa discount rate, and an IRR of 19.8% pa.
Work is currently underway to complete a definitive feasibility study which will further examine the Base Case used in the
Scoping Study and other optimising scenarios. Drill rigs have been mobilised to site and RC and Diamond drilling totalling
approximately 90,000 metres is underway. The initial focus of the drill programs will be to bring the current inferred
resources in the Central Zone into measured and indicated status. Further exploration drilling will also be undertaken
testing the northern and southern extents of the Mount Ida Banded Iron Formation (BIF) system with the objective of
substantially increasing the Mount Ida magnetite inferred resource base. Consultants have been commissioned to
work with the owners’ team on the major components of the feasibility study. SRK Consulting will undertake the key
components related to geology, resources, mining and hydrology, ProMet the metallurgy, process design and non-process
infrastructure, and Keith Lindbeck, the environmental and permitting requirements.
The feasibility study is scheduled to be finalised at the end of 2012.
6
annual report 2011 JUPITER MINES LIMITED
Figure 5 - RC drill rig at Mount Ida Central Zone
MOUNT MASON DSO HEMATITE PROJECT
Jupiter is the 100% owner of the Mount Mason high-grade hematite resource (DSO) which forms part of the Company’s
CYIP in Western Australia (refer to Figure 1).
Jupiter announced on 12 May 2011 that a Scoping Study on Mount Mason had been completed by ProMet. The Scoping
Study was based on the 2009 inferred resources of 5.75 million tonnes at 59.9% Fe, 3.5% Al2O3, 7.4% SiO2, 0.064% P
and 3.0% LOI using a 55% Fe cut-off grade. Based on a 1.5 mtpa production rate, the study confirmed a financially robust
DSO operation giving a project with less than 1 year payback, 70% internal rate of return and A$80 million free cash flow
generation potential.
The Scoping Study analysed two options available in terms of self-owning or contract mining, crushing and screening and
haulage to rail facilities as outlined in Table 1.
Options
Capital Costs
A$m
Operating Costs
A$/t FOB
NPV @ 8%
A$m
IRR
%
Option 1 – Jupiter owning and operating the crushing and
screening plant, with contract mining and haulage to rail at
Menzies
75.82
51.08
109.3
78
Option 2 – Mining, crushing and screening, and haulage to
rail at Menzies, all done on a contract basis
65.20
55.03
100.2
74
Table 1 - Mount Mason Development Options
7
JUPITER MINES LIMITED annual report 2011
REVIEW OF OPERATIONS
Figure 6 - Diamond drill rig at Mount Mason
Drilling has been completed at Mount Mason and the feasibility study has commenced which will run concurrently with the
Mount Ida feasibility study using the same Consultants. It is expected to be completed in early 2012.
TSHIPI KALAHARI MANGANESE PROJECT
Following shareholding approval at the EGM held on the 12 August 2010, Jupiter announced on the 8 November 2010
completion of the 49.9% acquisition of Tshipi é Ntle Manganese Mining (Pty) Ltd (“Tshipi”) (“The Tshipi Transaction”). Tshipi
owns two manganese projects located in the South African region of the Kalahari. Under the terms of the acquisition,
Jupiter issued 1,160,363,867 restricted ordinary shares at a price of 21.10 c/share (based on the 30 day volume weighted
average price of Jupiter shares prior to completion of The Tshipi Transaction) in exchange for 49.9% of the equity of Tshipi.
The Tshipi project is on track to become the market’s next major open pit manganese ore producer.
The shareholding structure upon completion of the Tshipi Transaction is shown in Figure 7.
Jupiter Mines Limited
Tshipi
Borwa
Tshipi
Bokone
Figure 7 - The Tshipi Project Shareholding Structure
8
annual report 2011 JUPITER MINES LIMITED
The Tshipi flagship project is the Tshipi Borwa Mine which is presently being developed as a new stand alone open-pit
manganese mine. The Tshipi Borwa Mine is located in the southern portion of the Kalahari Manganese Field, the largest
manganese bearing geological formation in the world. The Tshipi Bokone Project is an exploration property located in
the northern portion of the Kalahari Manganese Field. The Tshipi Borwa Mine is located adjacent to the Mamatwan mine
which is majority owned and operated by BHP Billiton. The Project will mine the ore body that is contiguous to, and a
direct extension of, the Mamatwan ore body which has been mined for over 45 years. As such the Tshipi Borwa Mine is
expected to produce an identical product that has been tried and tested in the global manganese markets.
TSHIPI BORWA MINE
During 2008 and 2009 Tshipi carried out a comprehensive drilling campaign which was the basis for the completion of a
feasibility study. Tshipi feasibility study indicated the viability of an open cut mining operation that is expected to produce
approximately 2.5 million tonnes per annum of lumpy product over 28 years, utilising 62 million tonnes of the 163 million
tonnes Mineral Resource estimate (see Table 2). These mineral resources are compliant with the South African Code for
the Reporting of Exploration Results, Mineral Resources and Mineral Reserves (“the SAMREC Code (2007)”), and the
Australian JORC Code (“JORC”).
Deposit
Indicated
Inferred
Total
(Indicated and Inferred)
Million tonnes
% Mn
Million tonnes
% Mn
Million tonnes
% Mn
Zone M
Zone C
Zone N
Altered
Total
22.69
22.95
12.83
3.35
61.82
37.95
36.68
36.67
35.35
37.07
39.64
40.61
20.73
0.43
101.41
37.87
37.01
35.98
31.41
37.11
62.33
63.56
33.56
3.78
163.23
37.90
36.89
36.25
34.90
37.10
Table 2 - Mineral Resources for The Tshipi Project as at July 2009 (excluding Top Cut)
On the 10 November 2010 Jupiter announced that SRK Consultants have undertaken a detailed assessment of the “Top-
Cut” which is a 17m thick manganese layer that occurs directly above the geological sequence on which Tshipi has based
its feasibility study on (the 163mt @ 37% as indicated in defined in Table 3). The Top-Cut consists of three separate
manganese layers (the X, Y and Z zones) which sampled lower grades than the lower layers (the M, C and N zones). The
X and Z zones of the Top-Cut have been estimated to contain 145mt of manganese ore at a 31.75% grade and these
resources are in addition to the “Feasibility Study” mineral resource estimate of 163 million tonnes at 37.1% manganese.
The Top-Cut is compliant with both the SAMREC Code (2007) and JORC.
It may be feasible to upgrade the Top-Cut through selective mining and/or post mining processing in order to produce a
saleable product. The potential sale of the Top-Cut material will result in a direct reduction in the Tshipi Borwa stripping
ratio and a reduction of the fixed costs per tonne of ore mined.
9
JUPITER MINES LIMITED annual report 2011
REVIEW OF OPERATIONS
Classification
Zone
Tonnes
(million)
Manganese
%
Indicated
Indicated
Total
Inferred
Inferred
Total
Indicated & Inferred
Indicated & Inferred
Grand Total
X
Z
X
Z
X
Z
25
14
39
78
28
106
103
42
145
Table 3 - Top Cut Mineral Resource Statement
33.03
33.41
33.17
30.90
31.29
31.00
31.41
32.01
31.58
Iron
%
4.62
6.01
5.13
4.82
6.09
5.15
4.77
6.06
5.14
Loss on Ignition
%
Relative
Density
20.19
19.50
19.94
20.78
19.01
20.32
20.64
19.17
20.22
3.56
3.57
3.56
3.53
3.62
3.55
3.54
3.60
3.56
Jupiter announced on the 7 February 2011 that Board approval had been received to commence the construction of the
Tshipi Borwa Mine at a production capacity of 2.4 mtpa of direct shippable manganese ore. The design of the mine and
associated surface infrastructure (including the crushing and screening plant, the load out station and the rail siding) have
been finalised. The capital expenditure for the project is expected to be ZAR 1,728 million ($237 million) which includes a
contingency of ZAR 260 million ($36 million). Jupiter is fully funded to contribute their 49.9% share of the Tshipi Project
capital expenditure of ZAR 734 million ($100 million) (excluding contingency).
Development of the mine has commenced and activities include initial clearing, fencing of the project area, soil compacting
and road development, with rock and water necessary for the construction being sourced from a neighbouring mine in
the area. The Tshipi Project has also awarded final contracts with major suppliers for the bulk earth works, rail siding
construction, plant construction and crusher fabrication. The preferred mining contractor has been identified and
negotiations are continuing to sign off on a final contract in order to commence pre-stripping. Discussions similarly
continue with Transnet, the state owned rail network operator, to secure rail allocation to Port Elizabeth.
Figure 8 - Impact soil compaction
Figure 9 - Site preparation
It is anticipated that upon reaching a steady state production rate, the Tshipi Project will be a lowest cost quartile producer
and that first production will be in the second half of 2012.
10
annual report 2011 JUPITER MINES LIMITED
NON-CORE PROJECTS
With Jupiter focused on delivering its SFC Strategy, no activity was undertaken on its non-core assets including gold, base
projects during the period. The gold and base metal projects are in the process of being divested.
Mount Alfred
No further exploration activities were undertaken on the Mount Alfred Project during the year.
Oakover Manganese Project
Jupiter’s Oakover Manganese Project tenement covers 890 km² over five granted Exploration Licences in the East Pilbara
region of Western Australia. (Figure 10)
Figure 10 - Oakover Manganese Project Location Map
11
JUPITER MINES LIMITED annual report 2011
REVIEW OF OPERATIONS
A 1,690m RC drilling program was completed during the year whereby high grade Mn intercepts were returned from the
mineralisation at shallow depths, with assay results of up to 40.7% Mn encountered at shallow depths. Upon completion
of the RC drilling, assays on 852 samples were undertaken with 24 significant intercepts of over 15% Mn encountered in
19 holes.
Hole Number
Prospect
Easting
Northing
From
To
Interval Mn%
Including
Fe%
P% LOI1000%
10OKRC004
10OKRC005
10OKRC006
10OKRS007
10OKRC011
10OKRC032
10OKRC033
10OKRC046
10OKRC053
10OKRC068
10OKRC069
10OKRC070
10OKRC074
10OKRC078
10OKRC081
10OKRC082
10OKRC084
10OKRC086
C12
C12
C12
C12
C12
C12
C12
C11
C11
C11
C11
C11
C11
C11
C11
C11
C11
C11
274752
7643357
274770
7643404
274789
7643339
274832
7643317
274891
7643293
275222
7643144
275257
7643177
276570
7644080
277058
7643516
277058
7643578
277093
7643608
277017
7643473
277051
7643507
277128
7643583
277070
7643369
277116
7643422
277063
7643314
277141
7643378
10OKRC087
C11
277190
7643408
0
0
0
0
0
5
0
14
25
21
10
0
26
18
21
1
7
15
20
0
13
6
20
0
9
3
5
7
9
12
11
6
23
33
24
17
15
29
32
25
3
9
17
22
4
19
12
23
3
12
Table 4 - Oakover Significant Intercepts Prospects C11 and C12
3
5
7
9
6
6
9
8
3
7
15
3
14
4
2
2
2
2
4
6
6
3
3
3
21.90
1m @ 31.40
5.45
0.008
8.19
15.84
1m @ 29.40
21.67
0.020
11.93
15.47
1m @ 27.00
7.87
0.009
15.88
3m @ 23.27
15.22
0.019
12
17.58
3m @ 27.32
13.62
0.010
28.67
2m @ 32.10
26.34
0.014
26.79
3m @ 34.07
25.03
0.025
7.62
8.81
8.64
11.72
11.40
16.33
1m @ 40.70
22.64
0.018
9.78
17.07
1m @ 25.90
30.22
0.022
15.70
1m @ 18.10
36.23
0.073
15.97
2m @ 21.40
34.30
0.050
10.66
11.15
10.97
19.70
4m @ 25.05
18.02
0.009
9.02
18.93
1m @ 26.00
34.47
0.018
18.21
3m @ 23.63
28.70
0.031
20.57
1m @ 29.00
23.67
0.019
11.48
10.99
10.06
27.92
1m @ 39.10
27.70
0.009
9.88
19.25
1m @ 19.85
29.15
0.011
10.04
18.00
1m @ 25.40
36.65
0.028
11..82
20.75
1m @ 27.50
30.72
0.019
16.92
1m @ 21.70
35.10
0.022
24.17
1m @ 26.10
27.37
0.007
16.12
1m @ 22.40
18.76
0.018
16.37
1m @ 18.60
19.58
0.023
10.75
10.68
10.95
9.68
9.41
22.78
1m @ 27.50
23.33
0.009
10.55
17.22
1m @ 27.80
24.72
0.009
7.78
Metallurgical test work from recent drilling on the C11 and C12 prospects was undertaken and designed to determine the
potential for JORC compliant inferred resources. Encouraging results were received with the average results reported
+35% Mn, <10% Si, 18% Fe and a yield of 38%.
The results from this drilling and metallurgical program are very encouraging, confirming the presence of manganese rich
horizons around Woodie Woodie’s high grade manganese deposits and elsewhere within the region.
Jupiter will be reviewing its exploration program at Oakover for 2012.
Tshipi Bokone Project
The initial exploration program has been completed and preliminary assay results confirm the continuity of mineralisation.
Jupiter has engaged the services of an independent geological consultant to conduct the mineral resource estimates.
12
annual report 2011 JUPITER MINES LIMITED
SCHEDULE OF MINERAL TENEMENTS
Lease
Name
Status
Applied
Date
Grant
Date
Expiry
Date
Current Area
Current
Commitment
Current
Rent
Holders
E29/560-I
E29/777
Mt Ida
Mt Ida
Granted
17/03/2004 8/09/2006
7/09/2011
56 Blocks
$84,000.00
$14,322.00
Jupiter Mines Ltd. (100%)
Granted
4/06/2010 15/02/2011 14/02/2016
35 Blocks
$35,000.00
$4,238.85
Jupiter Mines Ltd. (100%)
E29/581-I
Mt Alfred
Granted
3/03/2005
8/03/2006
7/03/2013
35 Blocks
$70,000.00
$8,951.25
Broadgold Corporation
(100%)
E29/726
Mt Alfred
Granted
19/03/2009 19/01/2010 18/01/2015
1 Blocks
$10,000.00
$291.72
Jupiter Mines Ltd. (100%)
M29/408-I
Mt Mason
Granted
6/02/2006 28/11/2007 27/11/2028
300 Ha
$30,000.00
$4,785.00
Jupiter Mines Ltd. (100%)
L29/78
Mt Ida Water
License
Granted
1/09/2009 24/06/2010 23/06/2031
6341 Ha
$0.00
$2,790.04
Jupiter Mines Ltd. (100%)
G29/21
General Purpose
Granted
22/05/2009 23/03/2010 22/03/2031
95 Ha
$0.00
$1,348.05
Jupiter Mines Ltd. (100%)
L29/79
G37/36
Mt Ida Water
License
General Purpose -
Graten Well
Granted
12/01/2010 24/08/2010 23/08/2031
6886 Ha
$0.00
$3,029.84
Jupiter Mines Ltd. (100%)
Granted
3/08/2009
17/01/11
16/01/2032
358.62 Ha
$0.00
$5,094.21
Jupiter Mines Ltd. (100%)
L37/203
General Purpose
Granted
3/05/2010 27/06/2011 26/06/2032
68952.89 Ha
0
2758.12
Jupiter Mines Ltd. (100%)
E45/2638
Oakover
Granted
21/04/2004 12/11/2008 11/11/2013
70 Blocks
$70,000.00
$13,190.10
Jupiter Mines Ltd. (100%)
E45/2639
Oakover
Granted
21/04/2004 10/06/2009
9/06/2014
28 Blocks
$28,000.00
$3,391.08
Jupiter Mines Ltd. (100%)
E45/2640
Oakover
Granted
21/04/2004 10/06/2009
9/06/2014
49 Blocks
$49,000.00
$5,934.39
Jupiter Mines Ltd. (100%)
E45/2641
Oakover
Granted
21/04/2004 10/06/2009
9/06/2014
70 Blocks
$70,000.00
$8,477.70
Jupiter Mines Ltd. (100%)
E45/3547
Oakover
Granted
28/10/2009 9/07/2010
8/07/2015
61 Blocks
$61,000.00
$7,387.71
Jupiter Mines Ltd. (100%)
E46/864
E46/888
South Woodie
Woodie
South Woodie
Woodie
Granted
22/10/2009 7/04/2011
6/04/2016
34 Blocks
$34,000.00
4117.74
Jupiter Mines Ltd. (100%)
Granted
3/02/2010
7/04/2011
6/04/2016
35 Blocks
$35,000.00
4238.85
Jupiter Mines Ltd. (100%)
P15/4358
Widgiemooltha
Granted
25/01/2000 22/08/2000 21/08/2004
119 Ha
$4,760.00
$274.89
Jupiter Mines Ltd. (100%)
E15/625
Widgiemooltha
Granted
28/10/1998 3/04/2000
2/04/2012
29 Blocks
$87,000.00
$14,045.57
Jupiter Mines Ltd. (100%)
E45/2964
Corunna Downs
Granted
1/12/2006 18/07/2007 17/07/2012
42 Blocks
$63,000.00
$7,914.06
Jupiter Mines Ltd. (100%)
M45/552
Klondyke
Granted
13/10/1992 19/01/1993 18/01/2014
9.713 Ha
$10,000.00
$156.20
M45/668
Klondyke
Granted
12/06/1995 29/12/1995 28/12/2016
240 Ha
$24,000.00
$3,828.00
M45/669
Klondyke
Granted
12/06/1995 29/12/1995 28/12/2016
120 Ha
$12,000.00
$1,914.00
M45/670
Klondyke
Granted
12/06/1995 29/12/1995 28/12/2016
120 Ha
$12,000.00
$1,914.00
G29/22
Mt Ida
Application
11/01/2011
L29/100
Mt Ida
Application
11/01/2011
M29/414
Mt Ida
Application
11/01/2011
E29/801
Mt Ida
Application
1/11/2010
E46/891
Oakover
Application
12/03/2010
E46/892
Oakover
Application
12/03/2010
L29/99
General Purpose
Application
12/11/2010
L29/81
General Purpose
Application
13/05/2010
M15/1457
Widgiemooltha
Application
22/03/2004
M15/1458
Widgiemooltha
Application
22/03/2004
M15/1459
Widgiemooltha
Application
22/03/2004
M15/1476
Widgiemooltha
Application
15/07/2004
9634 Ha
775 Ha
6461 Ha
26 Blocks
28 Blocks
4 Blocks
64550.49 Ha
26020.34 Ha
913 Ha
819 Ha
996 Ha
119 Ha
Jupiter Mines Ltd. (75%),
Garry E. Mullan (25%)
Jupiter Mines Ltd. (75%),
Garry E. Mullan (25%)
Jupiter Mines Ltd. (75%),
Garry E. Mullan (25%)
Jupiter Mines Ltd. (75%),
Monika R. Sommersperger-
Mullan (25%)
Jupiter Mines Ltd. (100%)
Jupiter Mines Ltd. (100%)
Jupiter Mines Ltd. (100%)
Jupiter Mines Ltd. (100%)
Jupiter Mines Ltd. (100%)
Jupiter Mines Ltd. (100%)
Jupiter Mines Ltd. (100%)
Jupiter Mines Ltd. (100%)
Jupiter Mines Ltd. (100%)
Jupiter Mines Ltd. (100%)
Jupiter Mines Ltd. (100%)
Jupiter Mines Ltd. (100%)
13
JUPITER MINES LIMITED annual report 2011
REVIEW OF OPERATIONS
COMPETENT PERSON STATEMENT
The information in this report that relates to Exploration and Mineral Resource Results is based on information compiled
by the following people:
Consultant Principle Geologist - V M Simposya
The information in this report that relates to the Tshipi Borwa Project Mineral Resources is based on information compiled
by Mr V M Simposya. Mr Simposya has a BSc (Geology), MSc (Mining Engineering), is a Partner and Principal Geologist
with SRK and is registered Professional Natural Scientists (Geological Science) Pri. Sci. Nat. He is also a member with
the South African Institute of Mining and Metallurgy (SAIMM). He is responsible for signing off Mineral Resources as a
Competent Person for the SAMREC Code, the JORC Code and the NI 43-101 and has consulted extensively for various
financial institutions. He has over 30 years’ experience in the mining industry with expertise in geological modelling and
resource estimation.
Senior Exploration Geologist - Michael O’Mara
The information in this report that relates to the Mineral Resources of Mount Ida and Oakover is based on information
compiled by Mr Michael O’Mara who is a Member of the Australian Institute of Geoscientists and a full- time employee
of Jupiter Mines Limited. Mr Michael O’Mara has sufficient experience which is relevant to the style of mineralisation and
type of deposit under consideration and to the activity that he is undertaking to qualify as a Competent Person as defined
in the 2004 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’.
Michael O’Mara consents to the inclusion in the announcement of the matters based on his information in the form and
context in which it appears. Michael O’Mara holds the position of Senior Exploration Geologist with Jupiter Mines Limited.
Mining Consultant - David Milton
The information in this report that relates to the Mineral Resources of Mount Mason is based on information compiled
by Mr David Milton, who is a Member of the Australian Institute of Mining and Metallurgy and a full time consultant with
Jupiter mines. Mr David Milton has sufficient experience in the type of deposits under consideration and to the activities
undertaken to qualify as a Competent Person as defined in the December 2004 Edition of the Australasian Code for
reporting Exploration Results, Mineral Resources and Ore Reserves and consents to the inclusion in the report of the
matters based on his information in the form and the context in which it appears.
14
{annual report 2011} JUPITER MINES LIMITED
ANNUAL FINANCIAL REPORT
for the year ended 30 June 2011
ABN 51 105 991 740 CONSOLIDATED ENTITY
15
JUPITER MINES LIMITED annual report 2011
CORPORATE GOVERNANCE STATEMENT
The Board of Directors of Jupiter Mines Limited is committed to maintaining a high standard of corporate governance
in accordance with the Australian Securities Exchange’s Corporate Governance Principles and Recommendations (ASX
Principles and Recommendations). In reviewing the corporate governance structure of the Company, the Board is guided
by the ASX Principles and Recommendations and Jupiter follows the ASX Principles and Recommendations to the extent
that it is practicable.
Set out below are the fundamental corporate governance practices of the Company.
Principle 1: Lay Solid Foundations for Management and Oversight
Role of the Board
The Board’s role is to govern Jupiter rather than to manage it. In governing Jupiter, the Directors must act in the best
interests of Jupiter as a whole. Each member of the Board is committed to spending sufficient time to enable them to carry
out their duties as a Director of Jupiter; any candidate will confirm that they have the necessary time to devote to their
Company Board position prior to appointment. In addition, Non-Executive Directors receive formal letters of appointment
setting out the key terms, conditions and expectations of their appointment.
Responsibilities of the Board
In general, the Board is responsible for, and has the authority to determine, all matters relating to the policies, practices,
management and operations of Jupiter. It is required to do all things that may be necessary to be done in order to carry
out the objectives of Jupiter.
The Board is responsible for governing Jupiter and for setting the strategic direction and has thereby established the
functions reserved to the Board. Board responsibilities are set out in the Jupiter Board Charter. The Board operates an
Audit Committee and a Remuneration & Nomination Committee to assist it in discharging its functions. The Board Charter
and Committee Charters are available on the Jupiter website (under “Corporate Governance”).
The Board generally holds meetings on a quarterly basis however additional meetings may be called as required. Directors’
attendance at meetings for the year is set out in the Director Report section of this Annual Report.
In carrying out its governance role, the main task of the Board is to oversee the performance of Jupiter. The Board is
committed to Jupiter’s compliance with all of its contractual, statutory and any other legal obligations, including the
requirements of any regulatory body.
Relationship with Management
The Board has delegated responsibility for the day-to-day operations of Jupiter to senior executives as set out in the Board
Charter. It is the role of senior executives to manage Jupiter in accordance with the direction and delegations of the Board
and the responsibility of the Board to oversee the activities of management in carrying out these delegated duties. Key
management information is set out in the Director Report section of this Annual Report.
Independent Professional Advice and Access to Company Information
Each Director has the right of access to all Jupiter information and to Jupiter’s executives. Further, the Board collectively
and each Director, subject to informing the Chairman, has the right to seek independent professional advice from a
suitably qualified advisor, at Jupiter’s expense, to assist them to carry out their responsibilities. Where appropriate, a copy
of this advice is to be made available to all other members of the Board.
Performance Review/Evaluation
Senior executive’s key performance indicators are set annually, with performance appraised by the Board, and reviewed
in detail by the Remuneration & Nomination Committee at the end of the financial year. This process of performance
evaluation was undertaken during the year as part of the senior executive’s remuneration review.
Education and Induction
New Directors undergo an induction process in which they are given a full briefing on Jupiter. Where possible, this will
include meetings with key executives, and a due diligence package and presentations from management.
16
annual report 2011 JUPITER MINES LIMITED
In order to achieve continuing improvement in Board performance, all Directors are encouraged to undergo continual
professional development.
Principle 2: Board Structure
Composition of the Board and details of Directors
Jupiter currently has six Directors at the date of this Annual Report. Mr Brian Gilbertson held the position of Non-Executive
Chairman throughout the year. Mr Paul Murray and Mr Andrew Bell held the position of independent Non-Executive
Directors. The remaining Directors Mr Priyank Thapliyal, and Mr Sun-Moon Woo are also Non-Executive Directors.
Mr Richard Mehan was appointed Managing Director on 9 May 2011.
The Company recognises the importance of Non-Executive Directors and the external perspective and advice that Non-
Executive Directors can offer. It is the approach and attitude of each Non-Executive Director which determine independence
and this must be considered in relation to each Director, while taking into account all other relevant factors.
Determination of the independence of Directors is made with reference to the relationships affecting independent status
as set out in the ASX Principles and Recommendations. Paul Murray and Andrew Bell are Independent Non-Executive
Directors. However, the Board was not comprised of a majority of independent Directors throughout the 2011 year and
as at the date of this Annual Report. The Chairman, Mr Brian Gilbertson is not independent as he is the Non-Executive
Chairman of Pallinghurst Resources Limited (Pallinghurst) which is a major shareholder of the Company. Mr Priyank
Thapliyal is also directly associated with Pallinghurst and therefore not independent. Mr Andrew Bell was previously not
independent as he is Chairman of Red Rock Resources Plc which was a substantial shareholder of Jupiter, however Red
Rock Resources Plc is no longer a substantial shareholder therefore Mr Andrew Bell is now considered independent.
Mr Sun Moon Woo is directly associated with POSCO Australia Pty Ltd, also a substantial shareholder of Jupiter, and
therefore not independent. Mr Richard Mehan in capacity of CEO and Managing Director is not considered independent.
Further details about the current Directors skills, experience and period of office are set out in the Directors’ Report section
of this Annual Report.
Performance Review/Evaluation
The Remuneration and Nomination Committee is responsible for the evaluation of the Board, committees and individual
Director’s performance. The Board has established policies to ensure that Jupiter remunerates fairly and responsibly. The
Remuneration Policy of the Board is designed to ensure that the level and composition of remuneration is competitive,
reasonable and appropriate for the results delivered and to attract and maintain desirable Directors.
Remuneration & Nomination Committee
The Board has established a Remuneration & Nomination Committee (Committee) and its role is set out a formal charter
which is available on the Jupiter website under “Corporate Governance”. Mr Paul Murray remained on the Committee
throughout the year as an independent Chairman of the Committee. Mr Andrew Bell and Mr Priyank Thapliyal are also
members of the Committee. The Committee’s responsibilities, among others, is to assess the necessary competencies
of the Board, review Board succession plans, develop processes for evaluation of the Board and the appointment and
re-election of Directors with reference to the guidance set out in the Board Charter.
Details of the members of the Remuneration & Nomination Committee and their attendance at Committee Meetings are
set out in the Director’s Report section of this Annual Report.
Principle 3: Ethical and Responsible Decision Making
Confidentiality
In accordance with legal requirements and agreed ethical standards, Directors and key executives of Jupiter have agreed
to keep confidential information received in the course of the exercise of their duties and will not disclose non-public
information except where disclosure is authorised or legally mandated.
17
JUPITER MINES LIMITED annual report 2011
CORPORATE GOVERNANCE STATEMENT
Company Code of Conduct and Ethics
As part of its commitment to recognising the legitimate expectations of stakeholders and promoting practices necessary
to maintain confidence in the Company’s integrity, Jupiter has an established Code of Conduct and Ethics (Code) to guide
compliance with legal, ethical and other obligations to legitimate stakeholders and the responsibility and accountability
required of the Company’s personnel for reporting and investigating unethical practices or circumstances where there are
beaches of the Code. These stakeholders include employees, clients, customers, government authorities, creditors and
the community as whole. This Code governs all Jupiter commercial operations and the conduct of Directors, employees,
consultants, contractors and all other people when they represent Jupiter.
The Board, management and all employees of Jupiter are committed to implementing this Code and each individual is
accountable for such compliance. A copy of the Code is given to all employees, contractors and relevant personnel,
including Directors, and is available on the Jupiter website (under “Corporate Governance”).
Trading in Jupiter Shares
Jupiter’s Share Trading Policy prohibits Directors from taking advantage of their position or information acquired in the
course of their duties, and the misuse of information for personal gain, or to cause detriment to the Company. Jupiter’s
Share Trading Policy is in line with the updated ASX Listing Rules (effective 1 January 2011) and Guidance Note issued
by the ASX.
Directors, senior executives and employees are required to advise Jupiter’s Company Secretary of their intentions prior
to undertaking any transaction in Jupiter securities. If an employee, officer or director is considered to possess material
non-public information, they will be precluded from making a security transaction until after the time of public release of
that information.
A copy of Jupiter’s Share Trading Policy is available on the Jupiter website (under “Corporate Governance”).
Principle 4: Financial Reporting Integrity
Audit Committee
The Board has established an Audit Committee to assist the Board. The responsibilities of the Committee are set out in a
formal charter which is available on the Jupiter website under “Corporate Governance”. The Audit Committee members
throughout the year comprised three Non-Executive members with Mr Paul Murray remaining the independent Chairman
of the Audit Committee. The other members were Mr Andrew Bell (independent Non-Executive member) and Mr Priyank
Thapliyal (Non-Executive member). The Board has considered that the composition of the Committee is appropriate for
the Company’s requirements at this time.
The Audit Committee Charter sets out the policy for the selection, appointment and rotation of external audit engagement
partners.
Details of the members of the Audit Committee and their attendance at Committee Meetings are set out in the Director’s
Report section of this Annual Report.
Principle 5: Timely and Balanced Disclosure
Continuous Disclosure
The Board has designated Jupiter’s Company Secretary as the person responsible for overseeing and co-ordinating
disclosure of information to the ASX as well as communicating with the ASX.
The Board has established a written policy for ensuring compliance with ASX Listing Rule disclosure requirements and
accountability at senior executive level for that compliance. A copy of the Jupiter Continuous Disclosure Policy is available
on the Jupiter website (under “Corporate Governance”).
Principle 6: The Rights of Shareholders
Shareholder Communication
Jupiter respects the rights of its shareholders and to facilitate the effective exercise of those rights, Jupiter communicates
with its shareholders continually and periodically and encourages shareholder participation at annual general
meetings. Periodic ASX announcements include quarterly reports, half-year report, annual report and annual general
18
annual report 2011 JUPITER MINES LIMITED
meeting presentations. Copies of all ASX announcements and reports are made available on the Company’s website.
Shareholders are encouraged to provide an email address to receive electronic copies of all announcements and reports.
The independent external auditor attends the Annual General Meeting to respond to questions from shareholders on the
conduct of the audit and the preparation and content of the audit report.
A copy of the Jupiter Shareholder Communications Policy is available on the Jupiter website (under “Corporate
Governance”).
Principle 7: Recognises and Manages Risk
The Board has accepted the role of identifying, assessing, monitoring, managing and mitigating wherever possible, any
material business risks applicable to Jupiter and its operations. It has not established a separate committee to deal with
these matters as the Directors consider the size of Jupiter and its operations does not warrant a separate committee at
this time. The Audit Committee is charged with the responsibility of financial risk management.
The Company is committed to the identification, monitoring and management of material business risks of its activities.
The Board has in place a number of policies that aim to manage specific risks that have been identified. The Company’s
personnel are responsible for adhering to the Occupational Health and Safety Policy as part of the risk management
process. Further, the Board is aiming to develop an overall policy for the oversight and management of material business
risks to accommodate its present and future stages of operations.
The Board assumes ultimate responsibility for the oversight and management of material business risks and satisfies
itself annually, or more frequently as required, that management has developed and implemented a sound system of risk
management and internal control to manage the Company’s material business risks. As the Company is aiming to develop
its risk management framework it will consider implementing management reporting on the Company’s key risks. The
Board delegates the adequacy and content of risk reporting to management. As part of the audit processes and review
throughout the year, the Board receives feedback that management has provided assurances to the auditors in relation
to parts of the risk management framework. Details of the Companies financial risks can be found in the Notes to the
accounts in this Annual Report.
Attestations by Chief Executive Officer/Chief Financial Officer
In accordance with Recommendation 7.3 of the ASX Principles, the Chief Executive Officer and Chief Financial Officer
have stated in writing to the Board:
“That:
1.
the statement given in accordance with section 295A of the Corporations Act, the integrity of financial statements
is founded on a sound system of risk management and internal compliance and control which implements the
policies adopted by the Board; and
2. Jupiter Mines Limited’s risk management and internal compliance and control system is operating efficiently
and effectively in all material respects.“
Principle 8: Remunerate Fairly and Responsibly
Remuneration Report and Remuneration Policies
The responsibilities of the Remuneration & Nomination Committee include making recommendations to the Board
regarding the remuneration of senior executives, executive directors and non-executive directors of the Company.
In accordance with the Constitution of Jupiter, shareholders determine the aggregate annual remuneration of the Non-
Executive Directors. It is the Board’s policy to issue options packages to Non-Executive Directors after a qualifying period
of six months service on the Board, and with the approval of shareholders at a general meeting. The Board believes
that this policy assists in attracting Non-Executive Directors who have the requisite skills to add value to the Board.
Remuneration of all Directors paid during the year is set out in the Remuneration Report and in note 5 to the Financial
Statements.
Further details on the structure of Executive Directors, Non-executive Directors and senior executives’ remuneration are
set out in the Remuneration Report on pages 27 to 33 of this Annual Report.
Non-Executive Directors are eligible to receive options over the Company’s shares at the time of their retirement where
it is considered an appropriate element of remuneration in situations when the Non-Executive’s skills and experiences
are recognised as important to the Company’s future development. The terms of the options are set out in agreements
between the Company and Non-Executive Directors and will vary depending on the age of the relevant Director at the
time of retirement.
19
JUPITER MINES LIMITED annual report 2011
DIRECTORS’ REPORT
In accordance with a resolution of Directors, the Directors present their Report together with the Financial Report of
Jupiter Mines Limited (Jupiter) and its wholly owned subsidiaries (together referred to as the Consolidated Entity) for the
financial year ended 30th June 2011 and the Independent Audit Report thereon.
Directors
The Directors of Jupiter at any time during or since the end of the financial year are as follows:
Non-Executive
Brian Patrick Gilbertson
Paul Raymond Murray
Andrew Bell
Priyank Thapliyal
Sun Moon Woo
Executive
Richard Mehan (appointed 9 May 2011)
Additional information is provided below regarding the current Directors.
Brian Patrick Gilbertson BSc (Maths and Physics), BSc (Hons) (Physics), MBL, PMD45
(Chairman: Non-Executive Director)
Mr Gilbertson was appointed as a Director on 22 June 2010.
Mr Gilbertson has extensive experience in the global natural resources industry. In the 1980’s, he was Managing Director
of Rustenburg Platinum Mines Limited, a period during which the company gained recognition as the world’s foremost
producer of platinum. Later, as Executive Chairman of Gencor Limited he led the restructuring of the South African mining
industry into the post-Apartheid era, transforming Gencor Limited into a focused mineral and mining group.
During this period he held ultimate responsibility for Impala Platinum Holdings, for Samancor Limited (the world’s largest
producer of manganese and chrome ore and alloys) and for Trans-Natal Coal Corporation (a major coal producer and
exporter). Important new initiatives included the Hillside and Mozal aluminium projects, the Columbus stainless steel plant,
and the purchase of the international mining assets (Billiton plc) of the Royal Dutch Shell Group. In 1997, Gencor Limited
restructured its non-precious metals interests as Billiton plc and, with Mr Gilbertson as Executive Chairman, Billiton
plc raised US$1.5 billion in an initial public offering on the LSE, taking the company into the FTSE 100. Separately Mr
Gilbertson worked to merge the gold operations of Gencor and Gold Fields of South Africa, creating Gold Fields Limited,
a leader in the world gold mining industry. He served as its first Chairman until October 1998. In 2001, Billiton plc merged
with BHP Limited to create what is widely regarded as the world’s premier resources company, BHP Billiton plc. Mr
Gilbertson was appointed its second Chief Executive on 1 July 2002.
In late 2003, Mr Gilbertson led mining group Vedanta Resources plc (Vedanta) to the first primary listing of an Indian
company on the London Stock Exchange in the second largest IPO of the year (US$876 million). He served as Chairman
of Vedanta until July 2004.
He was appointed President of Sibirsko-Uralskaya Aluminium Company (SUAL), the smaller aluminium producer in Russia
and led that company into the US$30 billion merger with RUSAL and the alumina assets of Glencore International A.G.,
creating the largest aluminium company in the world. He has not been a Director of any other ASX listed companies in the
past three years.
Mr Gilbertson established Pallinghurst Advisors LLP and the Investment Manager during 2006 and 2007, respectively, to
be the investment adviser and investment manager to a group of natural resource investors, which currently own 76% of
Jupiter. Mr Gilbertson is a British and South African citizen.
20
annual report 2011 JUPITER MINES LIMITED
Paul Raymond Murray FFin, CPA
(Independent Non-Executive Director, Remuneration Committee Chairman, Audit Committee Chairman)
Mr Murray was appointed as a Director on 20 August 2003.
Mr Murray has served on the Board and consulted to a number of ASX listed resource exploration companies.
With a business career spanning 50 years, he has also been responsible for the successful listing on the ASX of a number
of public companies. He has not been a Director of any other ASX listed companies in the past three years.
Andrew Bell B.A. (Hons), M.A., LLB (Hons), FGS
(Independent Non-Executive Director, Audit Committee Member, Remuneration Committee Member)
Mr Bell was appointed as a Director of Jupiter on 19 May 2008.
Mr Bell is Chairman of Red Rock Resources plc, a company listed on the AIM market of the London Stock Exchange
Ltd. He was a natural resources analyst in London in the 1970s, then specialised in investment and investment banking
covering the Asian region. He has been involved in the resource and mining sectors in Asia since the 1990s, and has
served on the Boards of a number of listed resource companies. He is a Fellow of the Geological Society.
Mr Bell is presently on the following Boards:
Chairman and Non-Executive Director of Resource Star Limited (ASX: RSL) since 2007
Red Rock Resources plc, (AIM:RRR) since 2005
Chairman of Regency Mines plc (AIM: RGM) since 2004
Greatland Gold plc (AIM: GGP). Since 2005
Priyank Thapliyal Metallurgical Engineer, B Tech, M Eng, MBA (Western Ontario, Canada)
(Non-Executive Director, Audit Committee Member, Remuneration Committee Member)
Mr Thapliyal was appointed as a Director of Jupiter on 4 June 2008.
Mr Thapliyal has been charged with implementing the Pallinghurst Resources Steel Making Materials strategy through
Jupiter.
Mr Thapliyal a founding partner of Pallinghurst Advisors LLP, joined Sterlite Industries in 2000 as a USD 100 million firm,
serving as deputy to the owner Mr. Anil Agarwal. He implemented the strategies that led to Sterlite becoming Vedanta
Resources plc (including its USD 870 million London IPO), a FTSE 100 company which was valued at USD 7.5 billion at
the time of his departure in October 2005.
Mr Thapliyal led Vedanta’s USD 50 million investment in Konkola Copper Mines, Zambia, in 2004, a stake currently valued
at more than USD 1 billion. Priyank was a former mining and metals investment banker with CIBCWM, Toronto Canada
and is a qualified Metallurgical Engineer, MBA (Western Ontario, Canada) and former Falconbridge employee. He has not
been a Director of any other ASX listed companies in the past three years.
Sun Moon Woo Masters Degree in Mining Engineering
(Non-Executive Director)
Mr Woo was appointed as a Director of Jupiter on 21 September 2009.
Mr Woo holds a Masters Degree in Mining Engineering and joined POSCO in 1983. Mr Woo has worked in the Raw Material
Purchasing Division and Investment Division of POSCO for 27 years.
Mr Woo has extensive experience in the natural resources industry and has experience in the management of iron ore and
coal projects in Australia as a Managing Director of POSCO Australia Pty Ltd. He has been a Non-Executive Director of
both Cockatoo Coal Limited (ASX: COK) since 2007 and Murchison Metals Limited (ASX: MMX) since 2007.
21
JUPITER MINES LIMITED annual report 2011
DIRECTORS’ REPORT
Richard Mehan B.Econ
(Managing Director and Chief Executive Officer)
Mr Mehan was appointed as a Director of Jupiter on 9 May 2011.
Richard has over 25 years in the bulk commodities sector.
Prior to joining Jupiter he was President and CEO of Asia Pacific for major US resources company Cliffs Natural Resources,
with responsibility for iron ore, coal business development and exploration.
Richard held a number of senior roles at Portman Ltd prior to their acquisition by Cliffs. These included General Manager
Iron Ore, General Manager Marketing and Chief Operating Officer. In 2005, he was appointed Managing Director & CEO of
Portman, prior to his most recent role at Cliffs. Before joining Portman Richard was with Rio Tinto for 15 years and worked
in a variety of commercial roles in iron ore and logistics. He was a Director of AusQuest Limited (AQD) until February 2011.
He has not been a Director of any other ASX listed companies in the past three years.
Company Secretary
Mr Matt Finkelstein BBus, CA was appointed as Company Secretary on 15 June 2011. Mr Finkelstein is also the Chief
Financial Officer of Jupiter.
Mr Finkelstein has an extensive background in finance, corporate finance and business advisory with companies such as
Ernst & Young, Goldman Sachs (London) and Pallinghurst Advisors LLP.
Significant Changes in the State of Affairs
There has been no significant change to the state of affairs of Jupiter during the year ended 30th June 2011.
The strategy going forward continues to focus on developing and consolidating the iron ore and manganese assets, and
to expand its portfolio of steel feed related commodities.
Principal Activities
The principal activities of Jupiter during the year have been the continuing evaluation and exploration of existing mineral
exploration interests. Following success in these areas, Jupiter is set to evolve from an exploration company to a mine
development and producing entity.
22
annual report 2011 JUPITER MINES LIMITED
REVIEW OF RESULTS AND OPERATIONS
The consolidated result of Jupiter for the financial year was a loss of $2,158,963 after income tax benefit of $87,204 (2010:
loss of $2,579,617 after an income tax expense of nil). Further details of the results of the Consolidated Entity are set out
in the accompanying financial statements in this Annual Report.
In addition, a summary of announcements made by Jupiter during the year ended 30th June 2011 is set out below:
Date
Announcement and Activities
6 July 2010
23 July 2010
Released the “Independent Expert’s Report”, the “Independent Technical Review Report”
and the “Independent Valuation Report” for the Tshipi Transaction.
Announced “Oakover Manganese Project” “Significant Manganese Mineralisation” over
wide spaced reverse circulation drilling completed over priority VTEM Anomalies.
30 August 2010
Announced that the “Mount Ida Magnetite Project – Development to be Fast Tracked”.
29 October 2010
Announced the completion of the Tshipi Transaction.
9 November 2010
Announced “Tshipi Borwa Manganese Project Reports additional Mineral Resources in the
Top-Cut”.
14 December 2010
Announced “Mount Ida Magnetite Project Phase 1 Drilling Program Complete”.
19 January 2011
Announced “Mount Ida Magnetite Project Maiden Inferred Magnetite Resource 530 million
Tonnes”.
31 January 2011
Announced “Jupiter raises $150 million to advance its Steel Feed Corporation Strategy”.
7 February 2011
Announced “Tshipi Borwa Manganese Project – Construction of Mine Approved”.
15 March 2011
Announced delivery of a “Robust Scoping Study on the Mount Ida Magnetite Project”.
9 May 2011
12 May 2011
Jupiter appointed Mr Richard Mehan Managing Director and Chief Executive Officer. Greg
Durack assumed the position of Chief Operating Officer.
Announced delivery of a “Robust Scoping Study on the Mount Mason DSO Hematite
Project”.
27 June 2011
Announced “Commencement of Feasibility Study” for the Mount Ida Magnetite Project.
Dividends
No dividends were paid or declared during the year by Jupiter.
Financial Position
During the year, Jupiter issued shares to a value of $410,108,659 (2010: $10,094,436) net of transaction costs and acquired
exploration interests or capitalised exploration costs to a value of $348,833,502 (2010: $4,738,040). At 30th June 2011,
Jupiter held $139,936,966 in cash and cash equivalents compared with $6,777,788 at 30th June 2010 and had carried
forward exploration expenditure of $19,648,304 compared with $12,328,678 at 30th June 2010.
Significant Events After Reporting Date:
In the opinion of the Directors, there has not arisen in the interval between 30th June 2011 and the date of this report, any
matter or circumstance that has significantly affected, or may significantly affect the Consolidated Entity’s operations,
results and the state of affairs in the future.
23
JUPITER MINES LIMITED annual report 2011
DIRECTORS’ REPORT
Likely Developments
The Directors intend Jupiter to proceed with exploration and development of Jupiter’s mineral interests and to consider
participation in any complementary exploration and mining opportunities which may arise. In particular, Jupiter may
pursue further joint venture opportunities where appropriate.
Further information about likely developments in the operations of Jupiter and the expected results of those operations on
future financial years have been omitted from this Report because disclosure of the information would be likely to result
in unreasonable prejudice to Jupiter.
Further information about Jupiter’s business strategies and its prospects for future financial years have been omitted from
this Report because disclosure of the information is likely to result in unreasonable prejudice to Jupiter.
Environmental Regulations and Performance
Jupiter’s operations are subject to general environmental regulation under the laws of the States and Territories of
Australia and South Africa, in which it operates. In addition, the various exploration interests held by Jupiter impose future
environmental obligations on it in relation to site remediation following sampling and drilling programs.
The Board is aware of these requirements and management is charged to ensure compliance. The Directors are not aware
of any breaches of these environmental regulations and licence obligations during the year.
Options and Rights
As at 30th June 2011 there were 5,300,000 (2010: 12,100,000) options over unissued shares in the capital of Jupiter, details
of which are set out in Note 22 and Note 23 of the attached Financial Statements.
No options were granted during the financial year.
6,800,000 options were exercised during the financial year.
Since 30th June 2011 to the date of this Annual Report, 200,000 options have been exercised, no options have been
granted.
No (2010: 3,100,000) options lapsed or were cancelled during the financial year.
24
annual report 2011 JUPITER MINES LIMITED
MEETINGS – ATTENDANCE BY DIRECTORS
Board Meetings
The number of Directors meetings and the number of meetings attended by each of the Directors of Jupiter during the
financial year under review are:
Director
Brian Gilbertson
Paul Murray
Priyank Thapliyal
Andrew Bell
Sun Moon Woo
Richard Mehan
Committee Meetings
Number of meetings held during the
tenure of the Director
Number of meetings attended
8
8
8
8
5
1
8
7
8
5
4
1
The number of committee meetings and the number of meetings attended by each of the Directors of Jupiter during the
financial year under review are:
Audit Committee
meetings
attended
Audit Committee
meetings held during
tenure
Remuneration
Committee meetings
attended
Remuneration
Committee meetings
held during tenure
2
2
2
2
2
1
-
-
-
-
-
-
Director
Paul Murray
Andrew Bell
Priyank Thapliyal
Directors’ Interests
Particulars of Directors’ interests in securities as at the date of this report are as follows:
Director
Brian Gilbertson¹
Paul Murray
Andrew Bell²
Priyank Thapliyal³
Sun Moon Woo4
Richard Mehan
Ordinary Shares
Options over Ordinary Shares
-
980,000
-
11,727,800
-
-
-
1,500,000
-
-
-
-
1 Brian Gilbertson as the Chairman of Pallinghurst Resources Limited (listed on the JSE and BSX) has a relevant interest in Pallinghurst Steel Feed Dutch (B.V.)
(PSF). PSF is the registered owner of 113,961,975 Ordinary Shares and 187,058,859 shares held in escrow until 8 November 2011.
2 Andrew Bell as the Chairman and Director of Red Rock Resources plc has a relevant interest in Red Rock Resources plc (RRR). RRR is the registered owner
of 74,200,832 Ordinary Shares.
3 Priyank Thapliyal is a Director of PSF and therefore has a relevant interest in PSF. PSF is the registered owner of 113,961,975 Ordinary Shares and
187,058,859 shares held in escrow until 8 November 2011.
4 Sun Moon Woo as the Managing Director of POSA Pty Ltd, has a relevant interest in POSA Pty Ltd (POSA) and POSCO Australia GP PTY LTD (POSA GP).
POSA is the registered owner of 55,624,454 Ordinary Shares, POSA GP is the registered owner of 271,586,321 shares held in escrow until 8 November 2011.
25
JUPITER MINES LIMITED annual report 2011
DIRECTORS’ REPORT
Contracts with Directors
There are no agreements with any of the Directors apart from Richard Mehan, please refer to the remuneration report for
further details.
Indemnification and Insurance of Officers and Auditors
Since the end of the previous financial year, Jupiter has paid premiums to insure the Directors and Officers of the
Consolidated Entity. Details of the nature of the liabilities covered and the amount of premium paid in respect of Directors’
and Officers’ insurance policies preclude disclosure to third parties.
Jupiter has not paid any premiums in respect of any contract insuring its auditor against a liability incurred in that role as
an auditor of Jupiter. In respect of non-audit services, Grant Thornton Audit Pty Ltd, Jupiter’s auditor has the benefit of an
indemnity to the extent Grant Thornton Audit Pty Ltd reasonably relies on information provided by Jupiter which is false,
misleading or incomplete. No amount has been paid under this indemnity during the financial year ending 30th June 2011
or to the date of this Report.
Non-Audit Services
The Board of Directors is satisfied that the provision of non-audit services during the financial year is compatible with the
general standard of independence for auditors imposed by the Corporations Act 2001. The Directors are satisfied that the
services disclosed below did not compromise the external auditor’s independence for the following reasons:
•
•
all non-audit services are reviewed and approved by the audit committee prior to commencement to ensure
they do not adversely affect the integrity and objectivity of the auditor; and
the nature of the services provided does not compromise the general principles relating to auditor independence
in accordance with APES 110: Code of Ethics for Professional Accountants set by the Accounting Professional
and Ethical Standards Board.
The following fees were paid or payable to Grant Thornton Australia Limited for non-audit services provided during the
year ended 30th June 2011:
$
Taxation and other services
21,500
21,500
Auditor’s Independence Declaration
The lead auditor’s independence declaration for the year ended 30th June 2011 has been received and can be found on
page 34 of the Annual Report.
Proceedings on behalf of Jupiter
No person has applied for leave of Court to bring proceedings on behalf of Jupiter or intervene in any proceedings to
which Jupiter is a party for the purpose of taking responsibility on behalf of Jupiter for all or any part of those proceedings.
Jupiter was not a party to any such proceedings during the year.
The Consolidated Entity was not a party to any such proceedings during the year.
26
annual report 2011 JUPITER MINES LIMITED
REMUNERATION REPORT (AUDITED)
This report details the nature and amount of remuneration for each Director of Jupiter Mines Limited and for the Key
Management Personnel.
Remuneration Policies and Practices
In relation to remuneration issues, the Board has established policies to ensure that Jupiter remunerates fairly and
responsibly. The remuneration policy of the Board is designed to ensure that the level and composition of remuneration
is competitive, reasonable and appropriate for the results delivered and to attract and maintain desirable Directors and
employees.
The remuneration structures reward the achievement of strategic objectives to achieve the broader outcome of creation of
value for shareholders. The Remuneration & Nomination Committee reviews and recommends to the Board on matters of
remuneration policy and specific emolument recommendations in relation to senior management and Directors.
The Board of Jupiter Mines Limited believes the remuneration policy to be appropriate and effective in its ability to attract
and retain the best executives and Directors to run and manage the Consolidated Entity, as well as create goal congruence
between Directors, executives and shareholders.
Non-Executive Director Remuneration
Fees
Non-Executive Director fees are determined within an aggregate Directors’ fee pool limit, which are periodically approved
by shareholders in general meeting. The current limit is $400,000. During the year ended 30th June 2011, $274,798 of the
fee pool was used.
Equity Participation
Non-Executive Directors’ remuneration may be by way of a fixed annual fee which is supplemented by the issue of
incentive options under the Jupiter Mines Limited Employee Option Plan and is subject to the approval of shareholders in
a general meeting. There were no options issued to Directors during the year.
Retirement Benefits
Non-Executive Directors do not receive retirement benefits, other than statutory superannuation entitlements.
Other Key Management Personnel Remuneration
Other Key Management Personnel (including Executive Directors) are offered a base salary, which is reviewed on a
periodic basis, having regard to market practices and the skills and experience of the Executive and is not linked to the
performance of the Consolidated Entity in any way.
Other Key Management Personnel receive other benefits as part of their type of employment, which may include a mobile
phone and laptop.
Selected Other Key Management Personnel are invited to participate in the Jupiter Mines Limited Employee Option Plan.
There are no termination benefits payable to Other Key Management Personnel, other than payment of their statutory
outstanding entitlements such as annual and long service leave.
27
JUPITER MINES LIMITED annual report 2011
DIRECTORS’ REPORT
Relationship between Remuneration Policy and Jupiter’s Performance
Details of the Jupiter Mines Limited Employee Option Plan (Plan) and specific information on the performance conditions
are set out below:
Description
Rationale
Options are offered to select employees and Key
Management Personnel of Jupiter. Non-Executive
Directors are entitled to participate in the Option
Plan as well.
Subject to the achievement of service conditions,
options may vest and be converted into ordinary
Jupiter shares on a one-for-one basis. An exercise
price is payable upon the conversion of options.
There are no voting or dividend rights attaching to
the options until they are exercised by the employee,
at which point ordinary shares which rank equally
with all other Jupiter shares are issued and quoted
on the ASX. The options cannot be transferred and
will not be quoted on the ASX.
All options expire on the earlier of their expiry date
or termination of the individual’s employment.
Anti-Hedging Policy
The Option Plan is designed to reward and retain
Directors, Key Management Personnel and select
employees of Jupiter.
The vesting conditions have been designed to
ensure correlation between Jupiter’s share price
performance and value delivered to shareholders.
Only when the share price increases can options
vest and be exercised; share price increases are
one of the considerations of the consequences of
Jupiter’s performance on shareholder wealth for
the purposes of 300A(1AB) of the Corporations
Act. The Plan therefore not only aligns the interests
of shareholders and participants alike, but in turn
assists in increasing shareholder value.
No Jupiter employee is permitted to enter into transactions with securities (or any derivative thereof) which
limit the economic risk of any unvested entitlements awarded under any Jupiter equity-based remuneration
scheme currently in operation or which will be offered by Jupiter in the future.
As part of Jupiter’s due diligence undertaken at the time of half and full year results, Jupiter’s equity plan
participants are requested to confirm that they have not entered into any such prohibited transactions.
Continuous Improvement
Jupiter will continually review all elements of its remuneration philosophy to ensure that they are appropriate
from the perspectives of governance, disclosure, reward and market conditions.
28
annual report 2011 JUPITER MINES LIMITED
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4
annual report 2011 JUPITER MINES LIMITED
Options and Rights over Equity Instruments Granted as Compensation
Details of entitlement to options over ordinary shares in Jupiter that were granted as compensation to the key management
personnel during the reporting period and details on options that vested during the reporting period are as follows:
Shares Issued on Exercise of Compensation Options 2011
Options which were exercised during the year were granted as compensation in prior periods.
Key Management Personnel
Mr R Benussi **
Bill Guy **
Bill Guy **
Bill Guy **
** Resigned prior to 30th June 2011
No. of Ordinary
Shares Issued
Amount Paid
per Share
Amount Unpaid
per Share
500,000
400,000
400,000
200,000
1,500,000
$0.20
$0.20
$0.25
$0.30
—
—
—
—
—
—
Shares Issued on Exercise of Compensation Options 2010
Key Management Personnel
Mr R Benussi
Options Granted as Remuneration 2011
No options were granted during the period as remuneration.
No. of Ordinary
Shares Issued
Amount Paid
per Share
Amount Unpaid
per Share
400,000
400,000
$0.20
—
—
—
Options Granted
as Part of
Remuneration
$
Total
Remuneration
Represented by
Options
%
—
—
—
—
—
—
—
—
—
—
Options
Exercised
Options
Lapsed
Total
$
—
—
57,000
116,000
173,000
$
—
—
—
—
—
$
—
—
57,000
116,000
173,000
Directors
Mr G L Wedlock *
Key Management Personnel
Mr R J Benussi **
Mr C W Guy **
* Deceased during the year
** Resigned prior to 30th June 2011
31
JUPITER MINES LIMITED annual report 2011
DIRECTORS’ REPORT
Options Granted as Remuneration 2010
Options
Granted
as Part of
Remuneration
$
Total
Remuneration
Represented by
Options
%
Directors
Mr G L Wedlock
Key Management Personnel
Mr R J Benussi
Mr C W Guy
—
94,500
—
—
94,500
Options
Exercised
Options
Lapsed
Total
$
—
—
$
—
—
$
—
94,500
—
44.05
—
—
—
100,800
(277,200)
(176,400)
—
—
—
100,800
(277,200)
(81,900)
Analysis of Options and Rights over Equity Instruments Granted as Compensation
No Options are yet to vest, as all options have vested.
Details of the vesting profile of the entitlement to options granted as remuneration to each of the key management
personnel for the comparative period are set out on the below:
Details of Options
Value yet to vest
Number
Grant Date
%
vested
in year
% forfeited
in year1
Financial year
in which grant
vests
Min
($)2
Previous Directors
Mr G L Wedlock
500,000
6-Nov-09
100
Previous Key Management Personnel
Mr R J Benussi
1,100,000
29-Dec-06
-
-
-
2010
-
-
-
Max
($)3
-
-
1 The percentage forfeited in the year represents the reduction from the maximum number of options available to vest due to the highest performance
criteria not being achieved.
2 The minimum value of options yet to vest is $nil as all options have vested.
3 The maximum value of options yet to vest is $nil as all options have vested.
32
annual report 2011 JUPITER MINES LIMITED
Summary of Key Contract Terms
Remuneration arrangements for Key Management Personnel are formalised in employment agreements. Details of these
contracts are provided below.
Chief Executive Officer
The CEO, Mr Richard Mehan, is employed under a rolling contract. Under the terms of the present contract, the CEO
receives fixed remuneration of $550,000 per annum. The CEO’s termination provision is a 3 month notice period.
Other Key Management Personnel
All other Key Management Personnel have rolling contracts with a standard 3 months termination notice period.
Corporate Governance
The Directors aspire to maintain the standards of Corporate Governance appropriate to Jupiter. Jupiter’s Corporate
Governance Statement is set out on pages 16 to 19 of this Report.
This report is signed in accordance with a resolution of the Board of Directors.
Brian P Gilbertson
London
29 September 2011
33
JUPITER MINES LIMITED annual report 2011
AUDITOR’S INDEPENDENCE DECLARATION
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Liability limited by a scheme approved under Professional Standards Legislation
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with its subsidiaries and related entities, delivers its services independently in Australia.
Liability limited by a scheme approved under Professional Standards Legislation
annual report 2011 JUPITER MINES LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2011
Note
Consolidated Group
Revenue
Depreciation and amortisation expense
Finance costs
Director and secretarial costs
Impairment of exploration interests
Impairment of property, plant and equipment
Acquisition costs
Insurance costs
Legal and professional costs
Travel and entertaining costs
Occupancy costs
Consultancy fees
Administration expenses
Employee benefits expense
Directors, employees & consultant option expenses
Foreign exchange losses
Other expenses
Loss before income tax
Income tax (expense)/benefit
Loss for the year
Net loss attributable to members of the parent entity
Other comprehensive income/(loss)
Net fair value loss on revaluation of financial assets
Foreign currency exchange differences on translating foreign
controlled operations
Other comprehensive loss for the year, net of tax
Total comprehensive loss for the year
Overall Operations
Basic loss per share (cents per share)
Diluted loss per share (cents per share)
2011
$
3,475,522
(260,033)
(21,625)
(274,798)
(443,626)
—
(1,156,867)
(82,725)
(487,205)
(361,153)
(208,121)
(231,782)
(676,211)
(746,293)
—
(726,945)
(44,305)
2010
$
544,120
(44,137)
(4,351)
(311,481)
(132,329)
(1,162)
—
(45,496)
(701,436)
(271,150)
(186,777)
(297,244)
(317,856)
(470,908)
(94,500)
—
(244,910)
(2,246,167)
(2,579,617)
87,204
—
(2,158,963)
(2,579,617)
(2,158,963)
(2,579,617)
(2,639,866)
(382,681)
(268,811)
—
(2,908,677)
(382,681)
(5,067,640)
(2,962,298)
(0.0018)
(0.0018)
(0.0075)
(0.0075)
2
3
3
3
3
4
11
23
8
8
The Statement of Comprehensive Income should be read in conjunction with the accompanying notes.
35
JUPITER MINES LIMITED annual report 2011
STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2011
ASSETS
CURRENT ASSETS
Cash and cash equivalents
Trade and other receivables
Other current assets
TOTAL CURRENT ASSETS
NON-CURRENT ASSETS
Financial assets
Property, plant and equipment
Intangible assets
Mining reserve
Other non-current assets
Exploration and evaluation assets
TOTAL NON-CURRENT ASSETS
TOTAL ASSETS
LIABILITIES
CURRENT LIABILITIES
Trade and other payables
Short-term borrowings
Short-term provisions
TOTAL CURRENT LIABILITIES
NON-CURRENT LIABILITIES
Deferred tax liability
Long-term provisions
TOTAL NON-CURRENT LIABILITIES
TOTAL LIABILITIES
NET ASSETS
EQUITY
Issued capital
Reserves
Accumulated losses
TOTAL EQUITY
Note
Consolidated Group
2011
$
2O10
$
9
10
15
11
13
14
18
15
16
19
20
21
18
21
22
23
139,936,966
6,777,788
1,298,878
450,572
103,036
11,141
141,686,416
6,891,965
6,255,569
9,002,615
4,288,739
116,416
341,511,875
11,696,632
220,884
94,999
—
808
19,648,304
12,328,678
383,517,535
21,647,984
525,203,951
28,539,949
2,615,845
756,331
476,412
157,412
8,621
93,053
3,249,669
858,005
89,955,370
—
89,955,370
93,205,039
—
7,193
7,193
865,198
431,998,912
27,674,751
456,510,087
46,928,586
838,996
3,937,373
(25,350,171)
(23,191,208)
431,998,912
27,674,751
The above Statement of Financial Position should be read in conjunction with the accompanying notes.
36
annual report 2011 JUPITER MINES LIMITED
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37
JUPITER MINES LIMITED annual report 2011
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2011
CASH FLOWS FROM OPERATING ACTIVITIES
Payments to suppliers and employees
Interest received
Other income
Finance costs
Note
Consolidated Group
2011
$
2010
$
(5,947,222)
(2,577,921)
2,100,551
1,373,763
(20,800)
330,001
122,129
(4,351)
Net cash used in operating activities
27(a)
(2,493,708)
(2,130,142)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property, plant and equipment
Purchase of financial assets
Purchase of intangible assets
Proceeds from sale of financial assets
Payments for other non-current assets
Advances to joint venture
Payments for exploration and evaluation
Net cash used in investing activities
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from the issue of shares, net of transaction costs and
conversion of options to shares
Cash acquired through acquisition of interest in joint venture
17
Proceeds from borrowings
Net cash provided by financing activities
Net increase in cash and cash equivalents held
Cash and cash equivalents at beginning of financial year
Effect of exchange rates on cash holdings in foreign currencies
(4,301,630)
(255,892)
-
(3,113,488)
(66,550)
-
678,933 509,445
(750,769)
(10,905,816)
-
-
(11,903,724)
(2,632,025)
(27,249,556)
(5,491,960)
161,734,377
7,887,621
868,855
467,065
-
-
163,070,297
7,887,621
133,327,033
265,519
6,769,167
6,503,648
(159,234)
-
Cash and cash equivalents at end of financial year
9
139,936,966
6,769,167
The Statement of Cash Flows should be read in conjunction with the accompanying notes.
38
annual report 2011 JUPITER MINES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDING 30TH JUNE 2011
Note 1: Summary Of Significant Accounting Policies
These consolidated financial statements and notes represent those of Jupiter Mines Limited (“Jupiter”) and it’s Controlled
Entities (the “Consolidated Group” or “Group”).
The separate financial statements of the parent entity, Jupiter Mines Limited, have not been presented within this financial
report as permitted by the Corporations Act 2001.
The financial statements were authorised and issued by the board of Directors on 29 September 2011.
Basis of Preparation
These general purpose financial statements have been prepared in accordance with Australian Accounting Standards,
Australian Accounting Interpretations, other authoritative pronouncements of the Australian Accounting Standards Board
(AASB) and the Corporations Act 2001.
Australian Accounting Standards set out accounting policies that the AASB has concluded would result in a financial
report containing relevant and reliable information about transactions, events and conditions. Compliance with Australian
Accounting Standards ensures that the financial statements and notes also comply with International Financial Reporting
Standards. Material accounting policies adopted in the preparation of this financial report are presented below and have
been consistently applied unless otherwise stated.
The financial report has been prepared on an accruals basis and is based on historical costs, modified, where applicable,
by the measurement at fair value of selected non-current assets, financial assets and financial liabilities.
(a)
Principles of Consolidation
The consolidated financial statements incorporate the assets, liabilities and results of entities controlled by
Jupiter Mines Limited at the end of the reporting period. A controlled entity is any entity over which Jupiter
Mines Limited has the power to govern the financial and operating policies so as to obtain benefits from its
activities. Control will generally exist when the parent owns, directly or indirectly through subsidiaries, more than
half of the voting power of an entity. In assessing the power to govern, the existence and effect of holdings of
actual and potential voting rights are considered.
A list of controlled entities is contained in Note 12 to the financial statements.
In preparing the consolidated financial statements, all inter-Group balances and transactions between entities in
the Consolidated Group have been eliminated on consolidation. Accounting policies of subsidiaries have been
changed where necessary to ensure consistency with those adopted by the parent entity.
Business Combinations
Business combinations occur where an acquirer obtains control over one or more businesses.
A business combination is accounted for by applying the acquisition method, unless it is a combination involving
entities or businesses under common control. The business combination will be accounted for from the date that
control is attained, whereby the fair value of the identifiable assets acquired and liabilities (including contingent
liabilities) assumed is recognised (subject to certain limited exemptions).
When measuring the consideration transferred in the business combination, any asset or liability resulting from a
contingent consideration arrangement is also included. Subsequent to initial recognition, contingent consideration
classified as equity is not remeasured and its subsequent settlement is accounted for within equity. Contingent
consideration classified as an asset or liability is remeasured each reporting period to fair value, recognising any
change to fair value in profit or loss, unless the change in value can be identified as existing at acquisition date.
All transaction costs incurred in relation to the business combination are expensed to the statement of
comprehensive income.
The acquisition of a business may result in the recognition of goodwill or a gain from a bargain purchase.
(b)
Interests in Joint Ventures
The Group acquired an interest in Tshipi é Ntle Manganese Mining (Proprietary) Limited (“Tshipi”), a joint venture
entity, during October 2010. The Group’s accounting policy for joint ventures was considered by the Directors as
part of the deliberation on the Tshipi acquisition, and had not been formally considered or articulated previously.
A joint venture entity is an entity in which the Group owns a long-term interest, and shares joint control over
strategic, financial and operating decisions with one or more other joint venturers. The Group have made the
accounting policy choice to proportionately consolidate interests in joint ventures, rather than to equity account,
39
JUPITER MINES LIMITED annual report 2011
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDING 30TH JUNE 2011
Note 1: Summary Of Significant Accounting Policies (cont’d)
(c)
as they believe it gives more useful information to shareholders. Proportionate consolidation combines the
Group’s share of the results of the joint venture entity, and the assets and liabilities of the joint venture entity, with
similar items in the statement of comprehensive income and statement of financial position.
Income Tax
The income tax expense (revenue) for the year comprises current income tax expense (income) and deferred tax
expense (income).
Current income tax expense charged to profit or loss is the tax payable on taxable income. Current tax liabilities
(assets) are measured at the amounts expected to be paid to (recovered from) the relevant taxation authority.
Deferred income tax expense reflects movements in deferred tax asset and deferred tax liability balances during
the year as well unused tax losses.
Current and deferred income tax expense (income) is charged or credited outside profit or loss when the tax
relates to items that are recognised outside profit or loss.
Except for business combinations, no deferred income tax is recognised from the initial recognition of an asset
or liability, where there is no effect on accounting or taxable profit or loss.
Deferred tax assets and liabilities are calculated at the tax rates that are expected to apply to the period when the
asset is realised or the liability is settled and their measurement also reflects the manner in which management
expects to recover or settle the carrying amount of the related asset or liability.
Deferred tax assets relating to temporary differences and unused tax losses are recognised only to the extent
that it is probable that future taxable profit will be available against which the benefits of the deferred tax asset
can be utilised.
Where temporary differences exist in relation to investments in subsidiaries, branches, associates, and joint
ventures, deferred tax assets and liabilities are not recognised where the timing of the reversal of the temporary
difference can be controlled and it is not probable that the reversal will occur in the foreseeable future.
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) a legally enforceable right of set-off exists; and (b) 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.
(d)
Property, Plant and Equipment
Each class of property, plant and equipment is carried at cost or fair value as indicated less, where applicable,
any accumulated depreciation and impairment losses.
Plant and equipment
Plant and equipment are measured on the cost basis.
The carrying amount of plant and equipment is reviewed annually by directors to ensure it is not in excess of the
recoverable amount from these assets. The recoverable amount is assessed on the basis of the expected net
cash flows that will be received from the asset’s employment and subsequent disposal. The expected net cash
flows have been discounted to their present values in determining recoverable amounts.
The cost of fixed assets constructed within the Consolidated Group includes the cost of materials, direct labour,
borrowing costs and an appropriate proportion of fixed and variable overheads.
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 statement of
comprehensive income during the financial period in which they are incurred.
40
annual report 2011 JUPITER MINES LIMITED
Depreciation
The depreciable amount of all fixed assets is depreciated on a straight-line basis over their useful lives to the
Consolidated Group commencing from the time the asset is held ready for use.
The depreciation rates used for each class of depreciable assets are:
Class of Fixed Asset
Office equipment
Furniture & fittings
Motor vehicles
Leasehold improvements
Buildings
Depreciation Rate
33.33%
7.50%
12.50%
20.00%
10.00%
(e)
(f)
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each reporting date.
An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount
is greater than its estimated recoverable amount.
Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These gains and
losses are included in the statement of comprehensive income.
Exploration and Evaluation Expenditure
The application of the Group’s accounting policy for exploration and evaluation expenditure requires judgment
in determining whether it is likely that future economic benefits are likely either from future exploitation or sale or
where activities have not reached a stage which permits a reasonable assessment of the existence of reserves.
The determination of a Joint Ore Reserves Committee (JORC) resource is itself an estimation process that
requires varying degrees of uncertainty depending on sub-classification and these estimates directly impact the
point of deferral of exploration and evaluation expenditure. The deferral policy requires management to make
certain estimates and assumptions about future events or circumstances, in particular whether an economically
viable extraction operation can be established. Estimates and assumptions made may change if new information
becomes available. If, after expenditure is capitalised, information becomes available suggesting that the recovery
of expenditure is unlikely, the amount capitalised is written off the Statement of Comprehensive Income in profit
or loss in the period when the new information becomes available.
Leases
Leases of fixed assets where substantially all the risks and benefits incidental to the ownership of the asset, but
not the legal ownership that is transferred to entities in the Consolidated Group, are classified as finance leases.
Finance leases are capitalised by recognising 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 period.
Leased assets are depreciated on a straight-line basis over the shorter of their estimated useful lives or the lease
term.
Lease payments for operating leases, where substantially all the risks and benefits remain with the lessor, are
recognised as expenses in the periods in which they are incurred.
Lease incentives under operating leases are recognised as a liability and amortised on a straight-line basis over
the lease term.
41
JUPITER MINES LIMITED annual report 2011
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDING 30TH JUNE 2011
Note 1: Summary Of Significant Accounting Policies (cont’d)
(g)
Financial Assets
Recognition and initial measurement
Financial assets and financial liabilities are recognised when the entity becomes a party to the contractual
provisions to the instrument. For financial assets, this is equivalent to the date that the company commits itself
to either the purchase or sale of the asset (ie trade date accounting is adopted).
Financial instruments are initially measured at fair value plus transaction costs, except where the instrument
is classified “at fair value through profit or loss”, in which case transaction costs are expensed to profit or loss
immediately.
Classification and subsequent measurement
Finance instruments are subsequently measured at fair value, amortised cost using the effective interest rate
method, or cost.
Amortised cost is the amount at which the financial asset or financial liability is measured at initial recognition
less principal repayments and any reduction for impairment, and adjusted for any cumulative amortisation of the
difference between that initial amount and the maturity amount calculated using the effective interest method.
Fair value is determined based on current bid prices for all quoted investments. Valuation techniques are applied
to determine the fair value for all unlisted securities, including recent arm’s length transactions, reference to
similar instruments and option pricing models.
The effective interest method is used to allocate interest income or interest expense over the relevant period and
is equivalent to the rate that discounts estimated future cash payments or receipts (including fees, transaction
costs and other premiums or discounts) through the expected life (or when this cannot be reliably predicted,
the contractual term) of the financial instrument to the net carrying amount of the financial asset or financial
liability. Revisions to expected future net cash flows will necessitate an adjustment to the carrying value with a
consequential recognition of an income or expense item in profit or loss.
The Group does not designate any interests in subsidiaries, associates or joint venture entities as being subject
to the requirements of Accounting Standards specifically applicable to financial instruments.
Financial assets at fair value through profit or loss
Financial assets are classified at “fair value through profit or loss” when they are held for trading for the purpose
of short-term profit taking, derivatives not held for hedging purposes, or when they are designated as such to
avoid an accounting mismatch or to enable performance evaluation where a Group of financial assets is managed
by key management personnel on a fair value basis in accordance with a documented risk management or
investment strategy. Such assets are subsequently measured at fair value with changes in carrying value being
included in profit or loss.
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.
Loans and receivables are included in current assets, where they are expected to mature within 12 months after
the end of the reporting period.
Held-to-maturity investments
Held-to-maturity investments are non-derivative financial assets that have fixed maturities and fixed or determinable
payments, and it is the Group’s intention to hold these investments to maturity. They are subsequently measured
at amortised cost.
Held-to-maturity investments are included in non-current assets where they are expected to mature within 12
months after the end of the reporting period. All other investments are classified as current assets.
Available-for-sale financial assets
Available-for-sale financial assets are non-derivative financial assets that are either not suitable to be classified
into other categories of financial assets due to their nature, or they are designated as such by management.
They comprise investments in the equity of other entities where there is neither a fixed maturity nor fixed or
determinable payments.
(i)
(ii)
(iii)
(iv)
42
annual report 2011 JUPITER MINES LIMITED
(v)
(h)
(i)
(j)
(k)
(l)
(m)
They are subsequently measured at fair value with changes in such fair value (ie gains or losses) recognised in
other comprehensive income (except for impairment losses and foreign exchange gains and losses). When the
financial asset is derecognised, the cumulative gain or loss pertaining to that asset previously recognised in other
comprehensive income is reclassified into profit or loss.
Available-for-sale financial assets are included in current assets where they are expected to be sold within 12
months after the end of the reporting period. All other financial assets are classified as non-current assets.
Financial liabilities
Non-derivative financial liabilities (excluding financial guarantees) are subsequently measured at amortised cost.
Impairment of Non-Financial Assets
At each reporting date, the Group reviews the carrying values of its tangible and intangible 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 its recoverable amount is expensed to
the statement of comprehensive income.
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.
Impairment testing is performed annually for goodwill and intangible assets with indefinite lives.
Employee Benefits
Provision is made for the Company’s liability for employee benefits arising from services rendered by employees
to reporting date. Employee benefits that are expected to be settled within one year have been measured at the
amounts expected to be paid when the liability is settled. Employee benefits payable later than one year have
been measured at the present value of the estimated future cash outflows to be made for those benefits. Those
cash flows are discounted using market yields on national government bonds with terms to maturity that match
the expected timing of cash flows.
Provisions
Provisions are recognised when the Group has a legal or constructive obligation, as a result of past events, for
which it is probable that an outflow of economic benefits will result and that outflow can be reliably measured.
Cash and Cash Equivalents
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, less credit card facilities used. Bank overdrafts are
shown as short-term borrowings in liabilities.
Trade and Other Receivables
Trade receivables, which generally have 30 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 trade receivables is reviewed on an ongoing basis at an operating unit level. 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.
Revenue and Other Income
Revenue is measured at the fair value of the consideration received or receivable after taking into account any
trade discounts and volume rebates allowed. Any consideration deferred is treated as the provision of finance
and is discounted at a rate of interest that is generally accepted in the market for similar arrangements. The
difference between the amount initially recognised and the amount ultimately received is interest revenue.
Interest revenue is recognised using the effective interest rate method, which, for floating rate financial assets, is
the rate inherent in the instrument.
All revenue is stated net of the amount of goods and services tax (GST).
43
JUPITER MINES LIMITED annual report 2011
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDING 30TH JUNE 2011
Note 1: Summary Of Significant Accounting Policies (cont’d)
Borrowing Costs
Borrowing costs directly attributable to the acquisition, construction or production of assets that necessarily take
a substantial period of time to prepare for their intended use or sale, are added to the cost of those assets, until
such time as the assets are substantially ready for their intended use or sale.
All other borrowing costs are recognised in the statement of comprehensive income in the period in which they
are incurred.
Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST
incurred is not recoverable from the Australian Taxation Office (ATO).
Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of
GST recoverable from, or payable to, the ATO is included with other receivables or payables in the statement of
financial position.
Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing
activities which are recoverable from, or payable to, the ATO are presented as operating cash flows included in
receipts from customers or payments to suppliers.
Trade and Other Payables
Trade and other payables are carried at cost and due to their short time 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 Jupiter 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 days of recognition.
Comparative Figures
When required by Accounting Standards, comparative figures have been adjusted to conform to changes in
presentation for the current financial year.
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 of non-financial assets
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.
Key estimates — Options
The fair value of services received in return for options granted are measured by reference to the fair value of
options granted. The estimate of the fair value of the services received is measured based on the Black Scholes
option-pricing model. The contractual life of the options is used as an input into the model. Expectations of early
exercise are incorporated into the model as well. Refer to note 23 for more details.
The expected volatility is based on the historic volatility of peer Group entities (calculated on the weighted
average remaining life of the share options), adjusted for any expected changes to volatility due to publicly
available information. Further information regarding assumptions are included in note 28.
Key judgements — Exploration and evaluation expenditure
The Group’s accounting policy for exploration and evaluation expenditure results in certain items of expenditure
being capitalised for an area of interest where it is considered likely to be recoverable by future exploitation or
sale or where the activities have not reached a stage which permits a reasonable assessment of the existence
of reserves. This policy requires management to make certain estimates and assumptions as to future events
and circumstances, in particular whether an economically viable extraction operation can be established. Any
(n)
(o)
(p)
(q)
(r)
44
annual report 2011 JUPITER MINES LIMITED
such estimates and assumptions may change as new information becomes available. If, after having capitalised
the expenditure under the policy, a judgement is made that recovery of the expenditure is unlikely, the relevant
capitalised amount will be written off to the statement of comprehensive income. An impairment has been
recognised in respect of exploration expenditure at reporting date of $443,626. Refer to note 16 for more details.
Mineral Reserves and Resource Estimates
Ore reserves are estimates of the amount of ore that can be economically and legally extracted from the Group’s
mining properties. The Group estimates its ore reserves and mineral resources based on information compiled
by appropriately qualified persons relating to the geological data on the size, depth and shape of the ore body,
and requires complex geological judgments to interpret the data. The estimation of recoverable reserves is based
upon factors such as estimates of foreign exchange rates, commodity prices, future capital requirements, and
production costs along with geological assumptions and judgments made in estimating the size and grade of
the ore body. Changes in the reserve or resource estimates may impact upon the carrying value of exploration
and evaluation assets, mine properties, property, plant and equipment, goodwill, provision for rehabilitation,
recognition of deferred tax assets, and depreciation and amortisation charges.
Share based payments
Under AASB 2 share based payments, the Company is required to determine the fair value of options issued
to employees as remuneration and recognise as an expense in the statement of comprehensive income. This
standard is not limited to options and also extends to other forms of equity-based remuneration.
Foreign Currency Translation
(i)
Functional and presentation currency
The functional and presentation currency of Jupiter and its subsidiaries is Australian dollars ($). The
presentation and functional currency for the interest in Tshipi is the South African Rand. The results are
translated into Australian dollars for disclosure in Jupiter’s consolidated accounts.
Non-monetary items that are measured in terms of historical cost in a foreign currency are translated
using the exchange rate as at the initial transaction. Non-monetary items measured at fair value in a
foreign currency are translated using the exchange rates at the date when the fair value was determined.
(ii)
Translation of interest in Joint Venture functional currency to presentation currency
The results of the South African Joint Venture interest are translated into Australian dollars using an
average rate over the period of the transactions. Assets and liabilities are translated at exchange rates
prevailing at reporting dates.
Exchange variations resulting from the translation of the net investments in Tshipi are taken to the foreign
currency translation reserve.
Adoption of New and Revised accounting standards and interpretations
During the current year, Jupiter adopted all of the new and revised Australian Accounting Standards and
Interpretations applicable to its operations which became mandatory. The adoption of these standards has
impacted the recognition, measurement and disclosure of certain transactions. The adoption of these standards
was applied for the entire reporting period unless otherwise stated. The following is an explanation of the impact
the adoption of these standards and interpretations has had on the financial statements of the Consolidated
Group.
AASB 3 Business Combinations
AASB 3 (revised 2008) introduces significant changes in the accounting for business combinations. Changes
affect the valuation of non-controlling interests (previously “minority interest”), the accounting for transaction
costs, the initial recognition and subsequent measurement of contingent consideration and business combinations
achieved in stages. These changes impact the amount of goodwill recognised, the report results for the period
when the acquisition occurred and future reported results. The change in AASB 3 will affect future acquisitions,
change in, and loss of control of, subsidiaries and transactions with non-controlling interests.
(s)
(t)
(u)
45
JUPITER MINES LIMITED annual report 2011
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDING 30TH JUNE 2011
Note 1: Summary Of Significant Accounting Policies (cont’d)
AASB 127 Consolidated and Separate Financial Statements
AASB 127 (revised 2008) requires that a change in the ownership interest of a subsidiary (without a change
in control) is to be accounted for as a transaction with owners in their capacity as owners. Therefore, such
transactions will no longer give rise to goodwill, nor will they give rise to a gain or loss in the statement of
comprehensive income. The revised standard changes the accounting for losses incurred by a partially owned
subsidiary as well as the loss of control of a subsidiary. The change in AASB 127 will affect future acquisitions,
change in, and loss of control of, subsidiaries and transactions with non-controlling interests.
Annual Improvements Project
In May 2009 and June 2010 the AASB issued omnibus of amendments to its Standards as part of the Annual
Improvements Project, primarily with a view to removing inconsistencies and clarifying wording. There are
separate transactional provisions and application dates for each amendment. The adoption of the following
amendments resulted in changes to accounting policies but did not have any impact on the financial position or
performance of the Group:
AASB 5 Non-current Assets Held for Sale and Discontinued Operations: clarifies that the disclosures required in
respect of non-current assets and disposal groups classified as held for sale of discontinued operations are only
those set out in AASB 5. The disclosure requirements of other Accounting Standards only apply if specifically
required for such non-current assets or discontinued operations.
AASB 8 Operating Segments: clarifies that segment assets and liabilities need only be reported when those
assets and liabilities are included in measures that are used by the Company’s decision makers. As the Groups
decision makers review segment assets and liabilities, the Group has continued to disclose this information.
AASB 107 Statement of Cash Flows: States that only expenditure that results in recognising an asset can be
classified as a cash flow from investing activities.
(v)
New accounting standards and interpretations for Application in Future Periods
Certain new accounting standards and interpretations have been published that are not mandatory for 30 June
2011 reporting periods and have not yet been applied in the financial report. Jupiter’s assessment of the impact
of these new standards and interpretations is set out below.
AASB 9 Financial Instruments
In November 2009, the AASB issued AASB 9 Financial Instruments which addresses the classification and
measurement of financial assets and is likely to affect Jupiter’s accounting for its financial assets. The standard
is not applicable until 1 January 2013 and the Group is yet to assess its full impact and whether to adopt AASB
9 in advance of 1 January 2013.
AASB 2009-11 Amendments to Australian Accounting Standards arising from AASB 9 (AASB 1, 3, 4, 5, 7, 101,
102, 108, 112, 118, 121, 127, 128, 131, 132, 136, 139, 1023 and 1038)
This standard shall be applied when AASB 9 is applied, refer above.
AASB 124 Related Party Disclosures
The AASB issued AASB 124 Related Party Disclosures which simplifies the definition of a related party, clarifying
its intended meaning and eliminating inconsistencies. The standard is not likely to have a significant impact on
the financial report. The standard is applicable from 1 July 2011.
AASB 2009-12 Amendments to Australian Accounting Standards (AASB 5, 8, 108, 110, 112, 119, 133, 137,
139, 1023 and 1031)
This amendment makes numerous editorial changes to a range of Australian Accounting Stands and Interpretation.
The standard is not likely to have a significant impact on the financial report. The standard is applicable from 1
46
annual report 2011 JUPITER MINES LIMITED
July 2011.
AASB 2010-5 Amendments to Australian Accounting Standards (AASB 1, 3, 4, 5, 101, 107, 112, 118, 119, 121,
132, 133, 134, 137, 139, 140, 1023 and 1038)
This amendment makes numerous editorial changes to a range of Australian Accounting Stands and Interpretation.
The standard is not likely to have a significant impact on the financial report. The standard is applicable from 1
July 2011.
AASB 2010-6 Amendments to Australian Accounting Standards (AASBV1 and 7)
The amendment increases the disclosure requirement for transactions involving transfers of financial assets. The
standard is not likely to have a significant impact on the financial report. The standard is applicable from 1 July
2011.
AASB 2010-7 Amendments to Australian Accounting Standards arising from AASB 9 (AASB 1, 3, 4, 5, 7, 101,
102, 108, 112, 118, 120, 121, 127, 128, 131, 132, 136, 137, 139, 1023 and 1038)
AASB 9 has been modified regarding the classification and measuring of financial liabilities. The standard is not
likely to have a significant impact on the financial report. The standard is applicable from 1 July 2011.
AASB 2011-1 Amendments to Australian Accounting Standards arising from the Trans-Tasman Convergence
project (AASB 1, 5, 101, 107, 108, 121, 128, 132 and 134)
This standard amendment removes many of the disclosing obligations which have been transferred to AASB
1054. The standard is not likely to have a significant impact on the financial report. The standard is applicable
from 1 July 2011.
Joint Arrangements
This standard replaces IAS 31 Interests in Joint Ventures and SIC 13 Jointly controlled entities – Non monetary
Contributions by Ventures. The standard is not applicable until 1 January 2013 and the Consolidated Group is
yet to assess its full impact and whether to adopt in advance of 1 January 2013.
Fair Value Measurement
This standard examines the definitions and application of fair value measurements. The standard is not applicable
until 1 January 2013 and the Consolidated Group is yet to assess its full impact and whether to adopt in advance
of 1 January 2013.
(w)
Carbon Tax Scheme
On 10 July 2011, the Commonwealth Government announced the “Securing a Clean Energy Future – the Australian
Government’s Climate Change Plan.” Whilst the announcement provides further details of the framework for a
carbon pricing mechanism, uncertainties continue to exist on the impact of any carbon pricing mechanism on
Jupiter as legislation must be voted on and passed by both Houses of Parliament. In addition, as Jupiter will
not fall within the “Top 500 Australian Polluters”, the impact of the Carbon Scheme will be through indirect
effects of increased prices on many production inputs and general business expenses as suppliers subject to
the carbon pricing mechanism are likely to pass on their carbon price burden to their customers in the form of
increased prices. The Board expects that this will not have a significant impact upon the operational costs within
the business, and therefore will not have an impact upon the valuation of assets and/or going concern of the
business.
47
Note
Consolidated Group
2011
$
(a)
2,874,264
601,258
3,475,522
2010
$
330,001
214,119
544,120
2,874,264
330,001
21,625
21,625
4,351
4,351
344,037
348,317
7,298
205,015
1,757
45,963
260,033
—
443,626
121,950
6,993
28,532
1,637
6,975
44,137
1,162
132,329
60,212
16
JUPITER MINES LIMITED annual report 2011
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDING 30TH JUNE 2011
Note 2: Revenue
— interest received
— other revenue
(a)
Interest revenue from:
—
other persons
Note 3: Loss from Ordinary Activities
(a)
Expenses
Finance costs:
— other persons
Total finance costs
Rental expense on operating leases
— operating lease rental
Depreciation of non-current assets:
—
leasehold improvements
— plant and equipment
—
furniture and fittings
Amortisation of non-current assets:
—
Intangibles
Total depreciation and amortisation expense
Impairment of property, plant and equipment
Impairment of exploration interests
Superannuation expense
48
annual report 2011 JUPITER MINES LIMITED
Note 4: Income Tax Expense
(a)
The prima facie tax on loss from ordinary activities before income tax is reconciled to the income tax as follows:
Prima facie tax expense/(benefit) on ordinary activities before income tax at 30% (2010: 30%)
—
Consolidated entity
Add:
Tax effect of:
— Tax rate differential
— Share options expensed
— Other non-deductible expenses
Less:
Tax effect of:
—
other deductible items
Income tax benefit
Income tax benefit not brought to account
Income tax (benefit)
(b)
Deferred income tax benefit (net of deferred tax liability reduced –
note c) in respect of tax losses not brought to account
Deferred income tax benefit attributable to timing differences not
brought to account included above.
Deferred income tax benefits will only be realised if the conditions for
deductibility set out in Note 1 occur.
Note
Consolidated Group
2011
$
2010
$
(673,850)
(773,885)
6,229
—
481,416
—
28,350
155,463
(186,205)
(590,072)
(80,181)
—
(266,386)
(590,072)
179,182
(87,204)
590,072
—
6,564,956
5,468,411
330,263
138,344
(c)
Deferred tax liabilities
The deferred income tax liability which has been reduced to nil by the
benefits attributable to tax losses not brought to account
6,923,563
4,605,135
49
JUPITER MINES LIMITED annual report 2011
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDING 30TH JUNE 2011
Note 5: Interests of Key Management Personnel
Refer to the Remuneration Report contained in the Report of the Directors for details of the remuneration paid or payable
to each member of the Group’s key management personnel for the year ended 30 June 2011.
(a)
Names and positions held of economic and parent entity key management personnel in office at any time
during the financial year are:
Key Management Person
Position
Mr B P Gilbertson
Chairman — non-executive
Mr S M Woo
Mr A Bell
Mr P R Murray
Mr P Thapliyal
Mr R Mehan
Mr G Durack
Mr M Finkelstein
Mr R J Benussi
Mr C W Guy
Director — non-executive
Director — non-executive
Director — non-executive
Director — non-executive
Managing Director and CEO
Appointed 9 May 2011
COO
CFO & Company Secretary
Appointed 15 June 2011
CFO & Company Secretary
Resigned 15 June 2011
Exploration Manager
Resigned 3 June 2011
(b)
The totals of remuneration paid to KMP of the Company and the Group during the year are as follows:
Consolidated Group
2011
$
1,079,520
51,123
—
—
2010
$
965,841
39,022
—
94,500
1,130,643
1,099,363
Short-term employee benefits
Post-employment benefits
Termination payments
Share-based payments
50
annual report 2011 JUPITER MINES LIMITED
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*
JUPITER MINES LIMITED annual report 2011
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDING 30TH JUNE 2011
Note 5: Interests of Key Management Personnel (cont’d)
(c)
Shareholdings
Number of Shares held by key management personnel
Key Management Personnel
Balance
1 July 2010
Received as
Remuneration
Options
Exercised
Mr P R Murray
Mr G Durack
Mr R J Benussi
Mr C W Guy
Mr P Thapliyal
980,000
—
—
—
7,913,680
8,893,680
—
—
—
—
—
—
—
—
Net
Change
Other*
—
—
Balance
30 June 2011
980,000
—
200,000
558,265
500,000
1,000,000
(300,000)
(441,735)
—
3,813,400
11,727,080
1,500,000
3,071,665
13,465,345
* Net change other refers to shares purchased or sold during the financial year.
NOTE:
Brian Gilbertson as the Chairman of Pallinghurst Resources Limited (listed on the JSE and BSX) has a relevant interest in Pallinghurst Steel Feed Dutch (B.V.)
(PSF). PSF is the registered owner of 113,961,975 Ordinary Shares and 187,058,859 shares held in escrow until 8 November 2011.
Andrew Bell as the Chairman and Director of Red Rock Resources plc has a relevant interest in Red Rock Resources plc (RRR). RRR is the registered owner
of 74,200,832 Ordinary Shares.
Priyank Thapliyal is a Director of PSF and therefore has a relevant interest in PSF. PSF is the registered owner of 113,961,975 Ordinary Shares and 187,058,859
shares held in escrow until 8 November 2011.
Sun Moon Woo as the Managing Director of POSA Pty Ltd, has a relevant interest in POSA Pty Ltd (POSA) and POSCO Australia GP PTY LTD (POSA GP).
POSA is the registered owner of 55,624,454 Ordinary Shares, POSA GP is the registered owner of 271,586,321 shares held in escrow until 8 November 2011.
Key Management Personnel
Balance
1 July 2009
Received as
Remuneration
Options
Exercised
Net
Change
Other*
Balance
30 June 2010
(1,165,000)
980,000
—
(400,000)
(15,000)
—
—
—
7,913,680
7,913,680
—
—
—
—
—
—
—
—
—
—
—
—
—
—
400,000
—
—
—
—
—
—
—
—
400,000
6,333,680
8,893,680
Mr P R Murray
Mr G Durack
Mr R J Benussi
Mr C W Guy
Mr P Thapliyal
Mr G L Wedlock
Mr B P Gilbertson
Mr S M Woo
Mr Andrew Bell
Mr Y Zhou
Mr Y Xie
2,145,000
—
—
15,000
—
—
—
—
—
—
—
2,160,000
—
—
—
—
—
—
—
—
—
—
—
—
* Net change other refers to shares purchased or sold during the financial year.
52
annual report 2011 JUPITER MINES LIMITED
NOTE:
Brian Gilbertson as the Chairman of Pallinghurst Resources Limited (listed on the JSE and BSX) has a relevant interest in Pallinghurst Steel Feed Dutch (B.V.)
(PSF). PSF is the registered owner of 92,899,165 Ordinary Shares.
Andrew Bell as the Chairman and Director of Red Rock Resources plc has a relevant interest in Red Rock Resources plc (RRR). RRR is the registered owner
of 85,734,165 Ordinary Shares.
Priyank Thapliyal is a Partner of Pallinghurst Resources LLP and has a relevant interest in Pallinghurst Steel Feed Dutch (BV) (PSF). PSF is the registered
owner of 92,899,165 Ordinary Shares.
Sun Moon Woo as the Managing Director of POSA Pty Ltd, has a relevant interest in POSA Pty Ltd (POSA). POSA is the registered owner of 48,000,000
Ordinary Shares.
Note 6: Auditors’ Remuneration
Remuneration of the auditor of the parent entity, Grant Thornton Audit Pty Ltd for:
- Auditing or reviewing the financial report
- Taxation and other services
Remuneration of the auditor of the subsidiary entities for auditing services was $4,883.
Consolidated Group
2011
$
2010
$
94,000
21,500
115,500
79,328
7,370
86,698
Note 7: Dividends
No dividends were declared or paid in the period.
—
—
Note 8: Earnings per Share
(a)
Reconciliation of earnings to net loss for the year
Net loss
Losses used to calculate basic EPS and dilutive EPS
Consolidated Group
2011
$
2010
$
(2,158,963)
(2,579,617)
(2,158,963)
(2,579,617)
(b) Weighted average number of ordinary shares outstanding during
No.
No.
the year used in calculating basic EPS and dilutive EPS
1,228,289,021
343,815,959
There are no dilutive potential for ordinary shares as the exercise of options to ordinary shares would have the
effect of decreasing the loss per ordinary share and would therefore be non-dilutive.
53
JUPITER MINES LIMITED annual report 2011
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDING 30TH JUNE 2011
Note 9: Current Assets – Cash and cash equivalents
Cash at bank and in hand
Short-term bank deposits
Note
Consolidated Group
2011
$
2010
$
14,756,759
6,594,788
125,180,207
183,000
139,936,966
6,777,788
The effective interest rate on short-term bank deposits was 5.86%; the term of deposits range between 30 and 180
days.
Reconciliation to the statement of cashflows
Cash at the end of the financial year as shown in the statement of cash flows is reconciled to items in the statement of
financial position as follows:
Cash and cash equivalents
Credit cards
139,936,966
6,777,788
20
— (8,621)
139,936,966
6,769,167
Note 10: Current Assets – Trade and other receivables
CURRENT
GST receivables
Sundry debtors
434,754
864,124
103,036
—
1,298,878
103,036
• Allowance for impairment loss: The Group’s exposure to bad debts is not significant.
• Related party receivables: For terms and conditions of related party receivables refer to Note 30.
•
Fair value and credit risk: Due to the short term nature of these receivables, their carrying value is assumed to
approximate their fair value.
Foreign exchange risk: Details’ regarding foreign exchange and interest rate risk exposure are disclosed in Note 31.
•
54
annual report 2011 JUPITER MINES LIMITED
Note 11: Current Assets - Financial assets
Consolidated Group
2011
$
2010
$
Available-for-sale financial assets comprise:
Listed investments, at fair value
—
shares and options in listed corporations
6,255,569
8,895,435
Unlisted investments, at cost
—
shares in unlisted companies
Total available-for-sale financial assets
—
6,255,569
107,180
9,002,615
Available-for-sale investments consist of investments in ASX listed companies ordinary shares, and therefore have no
fixed maturity date or coupon rate. The fair value of listed available-for-sale investments has been determined directly by
reference to published price quotations in an active market. This resulted in a net loss on revaluation of $2,639,866 for the
2011 financial year. For the 2010 financial year there was a net loss of $382,681.
Note 12: Controlled entities
Controlled entities consolidated
Note
Parent Entity:
- Jupiter Mines Limited
Subsidiaries of Jupiter Mines Limited:
- Future Resources Australia Limited
- Jupiter Uranium Pty Limited
- Central Yilgarn Pty Limited
- Broadgold Pty Limited
- Jupiter Kalahari Manganese Limited
(a)
(b)
* Percentage of voting power is in proportion to ownership
Country
of
Incorporation
Australia
Australia
Australia
Australia
Australia
Mauritius
Percentage Owned (%)*
100
100
100
100
100
100
100
100
100
100
(a)
(b)
Liquidation of entity:
During the year, Jupiter Uranium was entered into liquidation.
Principal Activities:
During the year all Controlled Entities with the exception of Jupiter Kalahari Manganese Limited were dormant.
55
JUPITER MINES LIMITED annual report 2011
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDING 30TH JUNE 2011
Note 13: Non-current assets – Property, plant and equipment
PLANT AND EQUIPMENT
Leasehold improvements
- At cost
- Accumulated depreciation
Plant and equipment
- At cost
- Accumulated depreciation
Furniture and fittings
- At cost
- Accumulated depreciation
Consolidated Group
2011
$
2010
$
14,407
(14,407)
-
4,526,422
(258,123)
4,268,299
26,198
(5,758)
20,440
14,407
(7,109)
7,298
248,641
(53,107)
195,534
22,053
(4,001)
18,052
Net carrying value
4,288,739
220,884
Movements in Carrying Amounts
Movement in the carrying amounts for each class of plant and equipment between the beginning and the end of the
current financial year
Consolidated Group:
$
$
$
Leasehold Improvements
Plant and
Equipment
Furniture and
Fittings
Balance at 1 July 2009
Additions
Disposals
Impairment
Depreciation expense
Balance at 30 June 2010
Additions
Disposals
Impairment
Depreciation expense
Balance at 30 June 2011
56
2,675
11,616
—
—
(6,993)
7,298
—
—
—
(7,298)
—
88,729
136,500
—
(1,163)
(28,532)
195,534
4,277,781
—
—
(205,016)
4,268,299
13,015
6,674
—
—
(1,637)
18,052
4,145
—
—
(1,757)
20,440
Total
$
104,419
154,790
—
(1,163)
(37,162)
220,884
4,281,926
—
—
(214,071)
4,288,739
annual report 2011 JUPITER MINES LIMITED
Note 14: Non-current assets - Intangible assets
Computer software
- At cost
- Accumulated amortisation
Net carrying value
Movements in carrying amounts
Balance at 1 July 2009
Additions
Amortisation expense
Balance at 30 June 2010
Additions
Amortisation expense
Balance at 30 June 2011
Consolidated Group
2011
$
2010
$
169,354
(52,938)
116,416
101,974
(6,975)
94,999
Total
$
871
101,103
(6,975)
94,999
67,380
(45,963)
116,416
Intangible assets have finite useful lives. The current amortisation charges for intangible assets are included under
depreciation and amortisation expense per the statement of comprehensive income. All software in amortised over 3
years.
Note 15: Other assets
CURRENT
Prepayments
NON-CURRENT
Deposits
Loans
(a) Loan notes:
Consolidated Group
Notes
2011
$
2010
$
450,572
11,141
(a)
3,786,130
7,910,502
11,696,632
808
—
808
These loans have no fixed repayment date. $3,182,135 of loans are interest free, the remaining loans accrue interest
at South African Prime rate.
Related party receivables: For terms and conditions of related party receivables refer to note 30.
Fair value: Details’ regarding fair value is disclosed in note 31.
Foreign exchange and interest rate risk: Details’ regarding foreign exchange and interest rate risk exposure is
disclosed in note 31.
Credit risk: The maximum exposure to credit risk at the reporting date is the higher of the carrying value of each class
of receivable. No collateral is held as security.
57
JUPITER MINES LIMITED annual report 2011
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDING 30TH JUNE 2011
Note 16: Non-current assets - Exploration and evaluation assets
Opening Balance
Additions
Impairment
Closing Balance
Costs carried forward in respect of the following areas of interest:
- Widgiemooltha
- Klondyke
- Mount Mason
- Mt Ida & Mt Hope
- Walling Rock
- Mt Alfred
- Corunna Downs
- Yunndaga
- Oakover
Total exploration expenditure
Consolidated Group
2011
$
12,328,678
6,876,000
443,626
19,648,304
200,000
571,106
3,855,779
8,958,890
—
1,311,074
72,315
40,000
4,638,910
19,648,304
2010
$
7,722,967
4,472,382
132,329
12,328,678
482,117
549,629
3,446,005
3,074,576
25,893
1,082,052
53,822
40,000
3,574,584
12,328,678
Capitalised costs amounting to $11,903,724 (2010: $2,632,025) have been included in cash flows from investing activities
in the statement of cash flows of which $6,547,875 relates to the parent company and the balance of $5,355,849 is
included under mining reserves resulting from the acquisition of interest in Joint Venture, refer to Note 17. The Group
has written-off exploration carrying costs of $443,626 as impaired assets during the year ended 30 June 2011 (2010:
$132,329) and is separately presented in the Statement of Comprehensive Income as impairment of exploration interests.
Impairment was incurred due to revaluation of the Widgiemooltha assets to fair value.
Note 17: Acquisition of interest in Joint Venture
On 29 October 2010, the Group completed the acquisition of 49.9% of the issued capital of Tshipi, a company with
manganese projects in South Africa, for a purchase consideration of $246,134,689, giving the Group joint control. The
vendors of the 49.9% interest in Tshipi were the Pallinghurst Co-Investors, share a single investment manager, the
Pallinghurst investment manager, which is chaired by Brian Gilbertson. Priyank Thapliyal is also a partner of the investment
manager.
The vendors of Tshipi included Pallinghurst Resources Limited, which is listed on the Johannesburg Stock Exchange and
Bermuda Stock Exchange. Brian Gilbertson is the Chairman of Pallinghurst Resources Limited. A further vendor of Tshipi
included a subsidiary of POSCO. POSCO is a Korean corporation that is listed on the Republic of Korea, New York and
Tokyo Stock Exchanges. Mr Woo is the Managing Director of POSCO Australia (Pty) Ltd.
Accordingly, the only Directors considered to be independent and able to vote on the acquisition were Paul Murray and
Andrew Bell. The Notice of General Meeting as sent to shareholders on 6 July 2010 (in advance of the General Meeting
held on 12 August 2010) noted that Paul Murray and Andrew Bell had both recommended that shareholders vote in favour
of all the relevant resolutions to complete the acquisition.
The Pallinghurst Co-Investors had previously entered into a joint venture agreement with Ntsimbintle Mining (Pty) Limited,
the owners of 50.1% of Tshipi. The joint venture agreement governs Tshipi’s operating and financing policies, and the
relationship between the joint venture partners. Jupiter Kalahari (Mauritius) Limited, a Jupiter subsidiary, has since become
party to an updated similar joint venture agreement, and assumed similar rights and obligations in the partnership.
58
annual report 2011 JUPITER MINES LIMITED
The acquisition of Tshipi is part of the Group’s overall strategy to expand its mineral resource projects in the mining
industry. The purchase was satisfied by the issue of 1,208,667,347 ordinary shares at an issue price of $0.211 each
and the payment of $255,027,602. The issue price of the new Jupiter shares was based on the 30 day volume weighted
average sale price as at 1 March 2010 (the announcement date).
Purchase consideration:
Interest bearing loan acquired
equity issued
17(a)
17(a) Assets acquired and liabilities assumed at the date of acquisition
Cash and cash equivalents
Receivables
Mining reserves (i)
Property, plant and equipment
Payables
Borrowings (ii)
Deferred tax liabilities
Deferred tax liabilities on consolidation (iii)
Identifiable assets acquired and liabilities assumed
Fair Value
$
8,892,913
246,134,689
255,027,602
868,855
25,103
340,262,745
5,502
(256,626)
(4,689,894)
(191,830)
(89,889,166)
246,134,689
(i)
(ii)
(iii)
Mining reserves acquired related to the mineral reserves located in the prospective manganese projects
owned by Tshipi in South Africa. The Directors believe these amounts are fully recoverable and no provision for
impairment is required.
Assets purchased included interest bearing loans due from Tshipi. The loan value at 30 June 2011 was
$15,675,217 (30 June 2010; Nil). The Group has eliminated 49.9% of the loan made to Tshipi on consolidation;
the balance of $7,910,502 (30 June 2010; nil) effectively represents the loan balance that has been made to the
50.1% of the joint venture not owned by the Group.
Deferred tax liability on consolidation of $89,889,166 related to recognition of future tax payable on profits
derived as a result of the mining operations at Tshipi.
Balances from ownership of 49.9% of Tshipi have been included in the consolidated reports of the Group at 30 June 2011.
Acquisition-related costs are included within the statement of comprehensive income totalling $1,156,867. The costs
include transaction tax and other settlement expenses.
59
JUPITER MINES LIMITED annual report 2011
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDING 30TH JUNE 2011
NOTE 18: Interest in Joint Venture
A controlled entity, Jupiter Kalahari (Mauritius) Limited, has a 49.9% interest in Tshipi, a joint venture entity, whose principal
activity is the exploration, mining and sale of manganese.
The Group accounts for its interest in the joint venture by using the proportionate consolidation and by combining the
Group’s share of each of the assets, liabilities, income and expenses of the jointly controlled entity with similar items, line
by line, in the Group’s financial statements.
The Group’s share of assets and liabilities employed in the joint venture is:
Consolidated Group
30 June 2011
$
30 June 2010
$
CURRENT ASSETS
Cash & cash equivalents
Trade and other receivables
TOTAL CURRENT ASSETS
NON-CURRENT ASSETS
Mining reserves
Property, plant and equipment
Intangible assets
Other non-current assets
TOTAL NON-CURRENT ASSETS
TOTAL ASSETS
CURRENT LIABILITIES
Trade and other payables
Short-term provisions
Short-term borrowings
TOTAL CURRENT LIABILITIES
NON-CURRENT LIABILITIES
Deferred tax liability
TOTAL NON-CURRENT LIABILITIES
TOTAL LIABILITIES
NET INTEREST IN JOINT VENTURE
13,135,196
338,774
13,473,970
341,511,875
1,292,829
439
3,035,361
345,840,504
359,314,474
621,505
32,958
476,444
1,130,907
89,955,370
89,955,370
91,086,277
268,228,197
The Group’s share of the joint venture income and expenses is:
Share of joint venture income
Share of joint venture expenses
Share of joint venture other comprehensive income
258
(1,921)
(912)
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
The recoverability of the carrying amount of the mining reserves is dependent on successful development and
commercial exploitation, or alternatively, sale of the respective areas of interest.
60
annual report 2011 JUPITER MINES LIMITED
Note 19: Current liabilities - Trade and other payable
CURRENT
Unsecured liabilities
Trade payables
Sundry payables and accrued expenses
Consolidated Group
2011
$
2010
$
1,694,785
921,060
2,615,845
445,592
310,739
756,331
Fair value: Due to the short term nature of these payables, their carrying value is assumed to approximate
their fair value.
Note 20: Current liability – Short-term borrowings
CURRENT
Loans
Bank credit cards
Consolidated Group
2011
$
2010
$
476,412
—
476,412
—
8,621
8,621
•
•
•
Fair Value and Credit Risk: due to the short term nature of these receivables, their carrying value is assumed to
approximate their fair value.
Included in other non-current assets (note 15) is a loan to Tshipi of $7,910,502. The current loan balance of $476,412
represents the element of this advance which has not been eliminated on consolidation.
Loan terms and conditions: there is no fixed repayment date for the loan as at 30 June 2011. The loan is interest free
and has no covenants attached to it at reporting date.
Financial Guarantees: the Group has provided no guarantees as at 30 June 2011
•
• Related party payables: for terms and conditions of related party receivables refer to Note 30.
Interest rate, foreign exchange and Liquidity Risk: for terms and conditions refer to Note 31
•
61
JUPITER MINES LIMITED annual report 2011
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDING 30TH JUNE 2011
Note 21: Current and non-current provisions
SHORT TERM PROVISIONS
Short-term employee benefits
Provision for onerous contracts
LONG TERM PROVISIONS
Provision for onerous contracts
Movements in provisions:
Short-term employee benefits
Carrying amount at the start of the year
Additional provisions recognised
Provisions used
At reporting date
Provision for onerous contracts
Carrying amount at the start of the year
Additional provisions recognised
Amount expensed
At reporting date
Note
Consolidated Group
2011
$
2010
$
146,320
11,092
157,412
—
—
75,788
136,429
(65,898)
146,319
24,458
—
(13,366)
11,092
75,788
17,265
93,053
7,193
7,193
39,347
68,956
(32,515)
75,788
81,006
—
(56,548)
24,458
The provision for onerous contracts comprises certain obligations on operating leases relating to premises. For further
details regarding these commitments see Note 24.
62
annual report 2011 JUPITER MINES LIMITED
Note 22: Issued capital
Paid up capital:
1,823,290,836 (2010: 369,786,471) fully paid ordinary shares
Nil (2010: 5,200,000) fully paid options
Note
Consolidated Group
2011
$
2010
$
22(a)
22(b)
456,510,087
—
456,510,087
46,401,428
527,158
46,928,586
(a) Ordinary shares
At the beginning of reporting period
46,401,428
36,306,992
Shares issued during the year, net of transaction costs
- 23,696,683 issued 29 October 2010
- 946,411,458 issued 8 November 2010
- 262,255,799 deferred shares issued
- 140,761,761 issued 4 February 2011
- 73,578,572 issued 29 April 2011
Shares issued during the previous period
Sub total
6,800,000 Options converted to shares during the period
At reporting date
22(e)
4,999,975
199,691,890
55,355,711
95,674,251
51,504,974
—
453,628,229
2,881,858
456,510,087
—
—
—
—
—
9,913,636
46,220,628
180,800
46,401,428
Ordinary shares participate in dividends and the proceeds on winding up of the parent entity in proportion to the number
of shares held.
At the shareholders 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.
The ordinary shares have no par value.
946,411,458 ordinary shares are subject to escrow until 8 November 2011.
63
JUPITER MINES LIMITED annual report 2011
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDING 30TH JUNE 2011
Note 22: Issued capital (cont’d)
At the beginning of the reporting period
Shares issued during the period
- 29 October 2010
- 8 November 2010
- Deferred shares
- 4 February 2011
- 29 April 2011
Conversion of options
Shares issued during the previous period
At reporting date
(b) Options
At the beginning of reporting period
Options issued during the year
Options exercised during the year:
Options lapsed during the year
At reporting date
At the beginning of the reporting period
Options issued during the year
Options exercised during the year:
Options lapsed during the year
At reporting date
(c) Options
Consolidated Group
2011
Number of shares
2010
Number of shares
369,786,471
240,385,875
23,696,683
946,411,458
262,255,799
140,761,761
73,578,572
—
—
—
—
—
—
—
6,800,000
1,823,290,744
129,400,596
369,786,471
Consolidated Group
2011
$
2010
$
527,158
—
(527,158)
—
—
589,658
—
—
(62,500)
527,158
Consolidated Group
2011
Number of options
2010
Number of options
5,200,000
6,700,000
—
(5,200,000)
—
—
—
(1,500,000)
—
5,200,000
The balance of options at the beginning of the reporting period totalling 5,200,000 were to expire between 30
November 2010 and 31 December 2010 at an exercise price of $0.35 per option
At 30 June 2011, there were no (30 June 2010: 5,200,000) unissued ordinary shares for which options were
outstanding. The options expire between 30 November 2010 and 31st December 2010 at an exercise price of
$0.35 per option.
64
annual report 2011 JUPITER MINES LIMITED
(d) Capital Management
Management controls the capital of the Group in order to maintain an appropriate debt to equity ratio, provide the
shareholders with adequate returns and ensure that the Group can fund its operations and continue as a going
concern.
The Group’s debt and capital includes ordinary share capital and financial liabilities, supported by financial assets.
There are no externally imposed capital requirements.
Management effectively manages the Group’s capital by assessing the Group’s financial risks and adjusting its
capital structure in response to changes in these risks and in the market. These responses include the management
of debt levels, distributions to shareholders and share issues.
There have been no changes in the strategy adopted by management to control the capital of the Group since the
prior year.
(e) Deferred shares
The deferred shares balance within equity refers to the 262,255,799 deferred shares which are to be issued to
Investec Bank Limited in consideration for their interest in Tshipi, which was vended into Jupiter as part of the
Tshipi Jupiter transaction referred to in Note 17 Acquisition of interest in Joint Venture. The terms of the transaction
stated that Investec would only be issued their shares in Jupiter after the twelve month warranties period has
expired, with the number of shares to be issued determined on the basis of whether there is a warranty claim
against Tshipi within twelve months. The deferred shares are to be issued to Investec twelve months from the date
of the issue of the shares relating to the transaction, being 8 November 2011.
The terms of this element of the transaction were disclosed more fully in the Notice of General Meeting as sent to
shareholders on 6 July 2010, which detailed the terms of the acquisition of the 49.9% interest in Tshipi by Jupiter.
The General Meeting was held on 12 August 2010 and all resolutions were passed.
Other than in the event of a warranty claim against Tshipi, Investec have a legal entitlement to be issued full
262,255,799 deferred shares. The Directors therefore believe that the economic substance of this part of the
transaction is that the deferred shares should be treated as equity (not liabilities), notwithstanding the legal
arrangements, and the balance is disclosed within equity in the consolidated statement of financial position. The
Directors believe it is very unlikely that any warranty claim will be made against Tshipi, either by 08 November
2011, or after that date.
65
JUPITER MINES LIMITED annual report 2011
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDING 30TH JUNE 2011
Note 23: Reserves
Options reserve
Financial assets reserve
Foreign currency reserve
Options issued:
5,300,000 (2010: 6,900,000)
options
The option reserve records items recognised as expenses on
valuation of key management personnel share options.
(a) Options
At the beginning of reporting period
Options issued during the year
Options converted to ordinary shares during the year
Options lapsed/cancelled during the year
At reporting date
At the beginning of the reporting period
Number of Options converted to ordinary shares during the
period
Number of Options issued during the year
Number of options lapsed/cancelled during the period
Note
Consolidated Group
2011
$
670,400
437,407
(268,811)
838,996
2010
$
860,100
3,077,273
—
3,937,373
670,400
860,100
(a)
(c)
(d)
(a)
860,100
1,188,600
—
94,500
(189,700)
—
(100,800)
(322,200)
670,400
860,100
2011
No
2010
No
6,900,000
8,400,000
(1,600,000)
(400,000)
—
—
500,000
(1,600,000)
At reporting date
(b)
5,300,000
6,900,000
(b) Options
Directors, employees and consultant share option scheme expenses of $nil (2010: $94,500) represents the
valuation of options granted. These were valued using the Black-Scholes pricing method.
At 30 June 2011, there were 5,300,000 (30 June 2010: 6,900,000) unissued ordinary shares for which options were
outstanding. These options will expire between 21 November 2011 and 3 October 2012 at exercise prices ranging
from $0.19 to $0.35 per option.
(c)
Financial Asset Reserve
The financial assets reserve records amounts relating to the revaluation of available for sale financial assets.
(d)
Foreign Currency Reserve
Foreign currency differences arising on the revaluation of Jupiter’s interest in Joint Venture and intercompany loans
denominated in currencies other than Australian Dollars.
66
annual report 2011 JUPITER MINES LIMITED
Note 24: Capital and Leasing Commitments
Operating Lease Commitments
Non-cancellable operating leases contracted for but not capitalised in
the financial statements
Payable - minimum lease payments
-
-
not later than 12 months
between 12 months and 5 years
Note
Consolidated Group
2011
$
2010
$
433,847
1,594,656
2,028,503
329,985
77,970
407,955
The property lease is non-cancellable for five-year, with rent payable monthly in advance.
The company has entered into a non-cancellable sub-lease arrangement which expires in November 2011. The
sub-lessee has assumed the make good commitments and the lease guarantee. The total expected minimum lease
payments to be received over the remainder of the lease is $42,472.
Exploration Expenditure Commitments
In order to maintain current rights of tenure to exploration tenements, the Company and Group are required to perform
minimum exploration work to meet the requirements specified by various State governments. These obligations can be
reduced by selective relinquishment of exploration tenure or application for expenditure exemptions. Due to the nature
of the Company and Group’s operations in exploring and evaluating areas of interest, it is very difficult to forecast the
nature and amount of future expenditure. It is anticipated that expenditure commitments for the next twelve months will be
tenement rentals of $119,568 (2010: $129,119) and exploration expenditure of $19,425,775 (2010: $4,524,551) of which
$4,425,775 relates to the Parent Company.
Note 25: Contingent Liabilities and Contingent Assets
Contingent Liabilities
The parent entity has provided guarantees to third parties in relation to the performance and obligations of controlled
entities in respect of banking facilities. At reporting date, the value of these guarantees and facilities are $750,769 (2010:
$170,000). Total utilised at reporting date was $8,129.
Contingent Assets
No contingent assets exist as at 30 June 2011 or 30 June 2010.
67
JUPITER MINES LIMITED annual report 2011
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDING 30TH JUNE 2011
Note 26: Segment Reporting
The Group operates in the mining industry within Australia and South Africa.
The Group has identified its operating segments based on the internal reports that are reviewed and used by the chief
operating decision makers (the Board of Directors and key management) in assessing performance and determining the
allocation of resources.
The Group segments are structured primarily on the basis of mineral as Central Yilgarn Iron Project (Iron Ore) located
in Australia, Tshipi (Manganese) which is located in South Africa and Corporate/Unallocated. Expenses and assets
are allocated to segments based on the tenement to which they directly relate. Information is not readily available for
allocating the remaining items of revenue, expenses, assets and liabilities, or these items are not considered part of the
core operations of any segment.
Proportionate consolidation of associates results
Operating results and share of assets and liabilities are proportionately consolidated for the purposes of internal reporting
whereas for the preparation of the financial statements they are equity accounted.
Impairment of exploration interests
(388,438)
(55,188)
CYIP – Iron Ore
(Australia)
$
Tshipi –
Manganese
(South Africa)
$
Corporate
&
Unallocated
$
Total
$
831,654
2,643,868
3,475,522
—
—
—
—
—
(824)
—
—
—
—
—
—
—
—
—
—
—
—
—
(37,294)
—
—
—
—
—
(726,945)
—
(260,033)
(260,033)
(20,800)
(274,798)
—
(21,624)
(274,798)
(443,626)
(1,156,867)
(1,156,867)
(82,725)
(449,911)
(361,153)
(208,121)
(231,782)
(676,211)
(746,293)
—
(44,305)
(82,725)
(487,205)
(361,153)
(208,121)
(231,782)
(676,211)
(746,293)
(726,945)
(44,305)
(388,438)
11,403
(1,869,131)
(2,246,166)
(i) Segment performance
30 June 2011
Revenue¹
Depreciation and amortisation
expense
Finance costs
Director and secretarial costs
Acquisition costs
Insurance costs
Legal and professional costs
Travel and entertaining costs
Occupancy costs
Consultancy fees
Administration expenses
Employee benefits expense
Foreign exchange loss
Other expenses
Net loss before tax from
continuing operations
68
Impairment of exploration interests
(90,526)
30 June 2010
Revenue¹
Depreciation and amortisation
expense
Finance costs
Director and secretarial costs
Impairment of property, plant and
equipment
Legal and professional costs
Travel and entertaining costs
Occupancy costs
Consultancy fees
Administration expenses
Employee benefits expense
Directors, employees & consultant
option expenses
Other expenses
Net profit before tax from
continuing operations
¹ The majority of the segments revenue are from interest
annual report 2011 JUPITER MINES LIMITED
CYIP – Iron Ore
(Australia)
$
Tshipi –
Manganese
(South Africa)
$
Corporate
&
Unallocated
$
Total
$
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
(508,777)
—
—
—
—
—
—
—
544,120
544,120
(44,137)
(44,137)
(4,351)
(311,481)
(41,803)
(4,351)
(311,481)
(132,329)
(1,162)
(1,162)
(192,659)
(271,150)
(186,777)
(297,244)
(317,856)
(470,908)
(701,436)
(271,150)
(186,777)
(297,244)
(317,856)
(470,908)
(94,500)
(94,500)
(290,406)
(290,406)
(90,526)
(508,777)
(1,980,314)
(2,579,617)
69
JUPITER MINES LIMITED annual report 2011
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDING 30TH JUNE 2011
Note 26: Segment Reporting (cont’d)
(ii) Segment assets and liabilities
CYIP – Iron Ore
(Australia)
$
Tshipi –
Manganese
(South Africa)
$
Corporate
&
Unallocated
$
Total
$
—
—
—
—
2,909,093
115,977
—
263,000
19,648,305
22,936,375
1,987,240
—
124,453
—
2,111,693
58,400,671
81,536,295
139,936,966
338,774
—
—
1,292,829
439
341,511,875
10,945,863
—
960,104
450,572
6,255,569
86,818
—
—
1,298,878
450,572
6,255,569
4,288,740
116,416
341,511,875
487,769
11,696,632
—
19,648,305
412,490,451
89,777,127
525,203,953
628,605
476,412
32,958
89,955,370
91,093,345
—
—
—
—
—
2,615,845
476,412
157,411
89,955,370
93,205,038
CYIP – Iron Ore
(Australia)
$
Tshipi –
Manganese
(South Africa)
$
Corporate
&
Unallocated
$
Total
$
—
—
—
—
—
—
—
—
—
—
—
—
7,668,526
7,668,526
3,574,583
3,574,583
—
—
—
—
—
—
—
—
—
—
6,777,788
6,777,788
103,036
11,949
103,036
11,949
9,002,615
9,002,615
220,884
94,999
220,884
94,999
1,085,569
12,328,678
17,296,840
28,539,949
756,331
756,331
8,621
93,053
7,193
8,621
93,053
7,193
865,198
865,198
30 June 2011
Cash and cash equivalents
Trade and other receivables
Other current assets
Financial assets
Property, plant and equipment
Intangible assets
Mining reserve
Other non current assets
Exploration and evaluation assets
Total assets
Trade and other payables
Short term borrowings
Short term provisions
Deferred tax liabilities
Total liabilities
30 June 2010
Cash and cash equivalents
Trade and other receivables
Other current assets
Financial assets
Property, plant and equipment
Intangible assets
Exploration and evaluation assets
Total assets
Trade and other payables
Short term borrowings
Short term provisions
Long term provisions
Total liabilities
70
annual report 2011 JUPITER MINES LIMITED
Note 27: Cash Flow Information
(a)
Reconciliation of Cash Flow from Operations to Loss after Income Tax
Loss after income tax
Non-cash flows included in loss after tax
Depreciation and amortisation
Net loss on disposal of property, plant and equipment
Share options recognised
Impairment of exploration and evaluation assets
Gain on revaluation of equities
Unrealised foreign exchange loss
Realised foreign exchange gain
Changes in assets and liabilities, net of the effects of purchase
and disposal of subsidiaries
(Increase)/decrease in GST receivable
Decrease in prepayments and deposits paid
(Increase)/decrease in other assets
(Increase)/decrease in other debtors
(Decrease) in trade payables and other creditors
Increase in deferred tax
Increase/(decrease) in provisions
Cash outflows from operations
Consolidated Group
2011
$
2010
$
(2,158,963)
(2,579,617)
260,033
—
—
443,626
—
744,034
(16,622)
—
—
(612,492)
(579,502)
(476,922)
(121,107)
24,207
44,137
1,162
94,500
132,329
(214,119)
—
—
(51,543)
3,667
—
34,000
501,237
—
(95,895)
(2,493,708)
(2,130,142)
(b)
Non cash financing and investing activities:
i. Share Issue
Tshipi Transaction: 1,208,667,257 ordinary shares were issued at $0.211 per share as part of the Tshipi
acquisition, refer to Notes 22 and 17.
ii.Options
6,800,000 unquoted options issued under the Jupiter Employee Options Plan were exercised during the
period.
iii.Exploration and evaluation
Capitalised costs amounting to $11,903,724 (2010: $2,632,025) have been included in cash flows from
investing activities in the statement of cash flows. Exploration and evaluation costs of ($771,751) (2010:
$2,106,015) were non-cash in nature.
71
JUPITER MINES LIMITED annual report 2011
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDING 30TH JUNE 2011
Note 27: Cash Flow Information (cont’d)
(c)
Credit Standby Arrangements with Banks
Credit facility
Amount utilised
Unused credit facility
The major facilities are summarised as follows:
Bank credit cards:
Bank credit cards are arranged with ANZ bank with the general terms
and conditions being set and agreed to annually
Interest rates are variable and subject to adjustment.
Note 28: Share-Based Payments
Consolidated Group
2011
$
2010
$
—
—
—
48,000
(8,621)
39,379
Each option granted under the Jupiter Mines Limited Employee Option Plan entitles the employee to acquire one ordinary
share of Jupiter Mines Limited (JMS). There are no voting or dividend rights attaching to the options until they are exercised
by the employee, at which point ordinary shares which rank equally with all other JMS shares are issued and quoted on
the ASX. The options cannot be transferred and will not be quoted on the ASX.
All options expire on the earlier of their expiry date or termination of the individual’s employment. Should the Vesting
Conditions (described below) not be met, options will lapse.
The terms and conditions of the grants on issue as at 30 June 2011 are as follows, whereby all options are settled by
physical delivery of shares:
Grant Date
No. of
Options
Vesting Date
Vesting Conditions
Expiry Date
Exercise
Price
23 July 2007
200,000
23 Jul 2007
Continuation of service
23 Jul 2012
$0.25
16 August 2007
800,000
16 Aug 2007
Continuation of service
4 Sep 2012
$0.25
16 August 2007
600,000
16 Aug 2007
Continuation of service
4 Sep 2012
$0.30
16 August 2007
600,000
16 Aug 2007
Continuation of service
4 Sep 2012
$0.35
2 October 2007
100,000
2 Oct 2007
Continuation of service
3 Oct 2012
$0.25
14 November 2006
500,000
14 Nov 2006
Continuation of service
21 Nov 2011
$0.20
14 November 2006
1,000,000
14 Nov 2006
Continuation of service
21 Nov 2011
$0.25
14 November 2006
1,000,000
14 Nov 2006
Continuation of service
21 Nov 2011
$0.35
6 November 2010
500,000
6 Nov 2010
Continuation of service
6 Nov 2012
$0.19
5,300,000
72
annual report 2011 JUPITER MINES LIMITED
Consolidated Group
2011
$
2010
$
Number of
Options
Weighted
Average
Exercise
Price $
Number of
Options
Weighted
Average
Exercise
Price $
Outstanding at the beginning of the period
6,900,000
0.26
8,400,000
Granted
Forfeited
Cancelled
Exercised
Expired
Outstanding at the end of the period
Exercisable at the end of the period*
*Closing JMS share price on 30 June 2011 was $0.4450
—
—
—
(1,600,000)
—
5,300,000
5,300,000
—
—
—
0.25
—
0.28
0.28
500,000
—
(500,000)
(400,000)
(1,100,000)
6,900,000
6,900,000
0.25
0.19
—
0.20
0.20
0.20
0.26
0.26
The options outstanding at 30 June 2011 have an exercise price of $0.28 a weighted average contractual life of 2.55 years.
During the financial year, 1,600,000 options were exercised (2010: 400,000).
The fair value of services received in return for options granted is measured by reference to the fair value of options granted.
The estimate of the fair value of the services received is measured based on the Black Scholes option-pricing model. The
contractual life of the options is used as an input into the model. Expectations of early exercise are incorporated into the
model as well.
Tranche
Expiry Date
Fair Value
per Option
$
Exercise
Price
$
Price of
Shares on
Grant
$
Estimated
Volatility
%
Risk Free
Interest
Dividend
Yield
%
1
6 Nov 2012
0.189
0.19
0.215
163.26
5.13
—
The expected volatility is based on the historic volatility of peer Group entities (calculated on the weighted average
remaining life of the share options), adjusted for any expected changes to volatility due to publicly available information.
Risk-free interest rates are based on 5 year government bonds.
Options will only convert to ordinary shares upon the achievement of a service condition.
Note 29: Events After the Reporting Date
There were no material events subsequent to reporting date.
73
JUPITER MINES LIMITED annual report 2011
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDING 30TH JUNE 2011
Note 30: Related Party Transactions
Transactions between related parties are on normal commercial terms and conditions no more favourable than those
available to other parties unless otherwise stated.
Transactions with related parties:
Consolidated Group
2011
$
2010
$
a. Key Management Personnel
Consulting fees paid to Keypalm Pty Ltd, a company in which Mr G L Wedlock
had a beneficial interest.
Consulting fees paid to Intrepid Concepts Pty Ltd, a company in which Mr R J
Benussi has a beneficial interest.
Consulting fees paid to Condorex Limited, a company in which Mr Andrew Bell
has a beneficial interest.
Consulting fees paid to PHM Securities Pty Ltd, a company in which Mr P R
Murray has a beneficial interest.
Expenses reimbursed to Pallinghurst Advisors LLP, a company in with Mr B
Gilbertson and Mr P Thapliyal have a beneficial interest.
—
120,000
237,500
187,500
53,774
60,544
55,917
57,810
185,148
155,287
Consulting Fees paid to Pallinghurst Steel Feed (Dutch) B.V., a company in which
Mr P Thapliyal has a beneficial interest.
128,833
90,492
A payable to Pallinghurst Steel Feed (Dutch) B.V., a company in which Mr P
Thapliyal has a beneficial interest.
47,500
42,625
b. Related Entities
Loan receivable from Tshipi
Loan payable to Tshipi
7,910,502
476,412
—
—
74
annual report 2011 JUPITER MINES LIMITED
Note 31: Financial Instruments
The Group’s financial instruments consist mainly of deposits with banks, short-term investments, accounts receivable and
payable.
The totals for each category of financial instruments, measured in accordance with AASB 139 as detailed in the accounting
policies to these financial statements, are as follows:
Financial Assets
Cash and cash equivalents
Trade and other receivables
Available-for-sale financial assets
Other non-current assets
Financial Liabilities
Trade and other payables
Short-term borrowings
Financial Risk Management Policies
Consolidated Group
2011
$
2010
$
139,936,966
1,298,878
6,255,569
11,696,632
159,188,045
2,615,845
476,412
3,092,257
6,777,788
103,036
9,002,615
—
15,883,439
756,331
8,621
764,952
The Directors monitor the Group’s financial risk management policies and exposures and approves financial transactions.
The Directors’ overall risk management strategy seeks to assist the Group in meeting its financial targets, while minimising
potential adverse effects on financial performance. Its functions include the review of credit risk policies and future cash
flow requirements.
Specific Financial Risk Exposures and Management
The main risks the Group is exposed to through its financial instruments are credit risk, liquidity risk and market risk
consisting of interest rate risk, liquidity risk and equity price risk.
(a)
Credit Risk
Exposure to credit risk relating to financial assets arises from the potential non-performance by counterparties
of contract obligations that could lead to a financial loss to the Group.
Credit risk is managed through the maintenance of procedures (such procedures include the utilisation of
systems for the approval, granting and renewal of credit limits, regular monitoring of exposures against such
limits and monitoring of the financial stability of significant customers and counterparties), ensuring to the extent
possible, that customers and counterparties to transactions are of sound credit worthiness. Such monitoring is
used in assessing receivables for impairment.
Risk is also minimised through investing surplus funds in financial institutions that maintain a high credit rating,
or in entities that the Directors have otherwise cleared as being financially sound.
75
JUPITER MINES LIMITED annual report 2011
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDING 30TH JUNE 2011
Note 31: Financial Instruments (cont’d)
Credit Risk Exposures
The maximum exposure to credit risk by class of recognised financial assets at reporting date, excluding the
value of any collateral or other security held, is equivalent to the carrying value and classification of those financial
assets (net of any provisions) as presented in the statement of financial position. Credit risk also arises through
the provision of financial guarantees, as approved at Board level, given to parties securing the liabilities of certain
subsidiaries (refer Note 25 for details).
Trade and other receivables that are neither past due or impaired are considered to be of high credit quality.
Aggregates of such amounts are as detailed in Note 10.
There are no amounts of collateral held as security in respect of trade and other receivables.
The Group does not have any material credit risk exposure to any single receivable or group of receivables under
financial instruments entered into by the Consolidated Group.
Credit risk related to balances with banks and other financial institutions is managed by investing cash with major
financial institutions in both cash on deposit and term deposit accounts. Interest rates on major deposits that are
re-invested, are at a fixed rate on a monthly basis.
(b)
Liquidity risk
Liquidity risk arises from the possibility that the Group might encounter difficulty in settling its debts or otherwise
meeting its obligations related to financial liabilities. The Group manages this risk through the following
mechanisms:
preparing forward looking cash flow analysis in relation to its operational, investing and financing activities;
obtaining funding from a variety of sources;
•
• monitoring undrawn credit facilities;
•
• maintaining a reputable credit profile;
• managing credit risk related to financial assets;
•
only investing surplus cash with major financial institutions; and comparing the maturity profile of financial
liabilities with the realisation profile of financial assets.
The Group has no significant exposure to liquidity risk due to the level of cash and cash equivalents detailed at
Note 9. The Group manages liquidity risk by monitoring immediate and forecast cash requirements and ensuring
adequate cash reserves are maintained.
The tables below reflect an undiscounted contractual maturity analysis for financial liabilities. Cash flows
realised from financial assets reflect management’s expectation as to the timing of realisation. Actual timing may
therefore differ from that disclosed. The timing of cash flows presented in the table to settle financial liabilities
reflects the earliest contractual settlement dates.
76
annual report 2011 JUPITER MINES LIMITED
Within 1 Year
1 to 5 Years
Over 5
Years
Total
2011
2010
2011
2010
2011
2010
2011
2010
Consolidated Group
Financial liabilities
due for payment
Short term
borrowings
Trade and other
payables
Total expected
outflows
Financial assets
— cash flows
realisable
Cash and cash
equivalents
Trade and other
receivables
476,412
8,621
2,615,845
756,331
3,092,257
764,952
139,936,966
6,777,778
1,298,878
103,036
Other current assets
450,572
—
6,255,569
9,002,615
Available for sale
financial assets
Other non-current
assets
Total anticipated
inflows
Net (outflow)/
inflow on financial
instruments
—
—
—
—
—
—
—
—
—
—
476,412
8,621
—
—
—
2,615,845
756,331
—
—
—
3,092,257
764,952
—
—
— 139,936,966
6,777,778
—
—
—
1,298,878
103,036
—
—
—
450,572
—
—
—
—
6,255,569
9,002,615
—
— 11,696,632
—
—
—
11,696,632
—
147,941,985
15,883,429 11,696,632
—
—
— 159,638,617
15,883,429
144,849,728
15,118,477 11,696,632
—
—
— 156,546,360
15,118,477
77
JUPITER MINES LIMITED annual report 2011
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDING 30TH JUNE 2011
Note 31: Financial Instruments (cont’d)
(c)
(i)
Market Risk
Market risk arises from the Groups use of interest bearing and foreign currency financial instruments. It is the risk
that the fair value of future cash flows of a of a financial instrument will fluctuate because of changes in interest
rates (interest rate risk), foreign exchange (currency risk) or other market factors (other price risk).
Interest rate risk
Exposure to interest rate risk arises on financial assets and financial liabilities recognised at the end of the reporting
period whereby a future change in interest rates will affect future cash flows or the fair value of fixed rate financial
instruments. The financial assets and financial liabilities with exposure to interest rate risk is detailed below:
Financial Assets
Cash and cash equivalents
Other Non-Current Assets
Financial Liabilities
Short Term Borrowings
30 June 2011
$
30 June 2010
$
139,936,966
8,514,497
148,451,463
6,777,788
—
6,777,788
476,412
476,412
8,621
8,621
The Group is also exposed to earnings volatility on floating rate instruments.
(ii)
Foreign exchange risk
Jupiter operates internationally and is exposed to foreign exchange risk arising from various currency exposures
primarily with respect to the Australian Dollar and South African Rand. Jupiter’s exposure to currency risk is on
cash, trade receivables, and borrowings.
78
annual report 2011 JUPITER MINES LIMITED
Foreign currency risk is the risk of exposure to transactions that are denominated in a currency other than the
Australian dollar. The carrying amounts of the Group’s financial assets and liabilities are denominated in two
different currencies as set out below:
Financial Assets
Cash and cash equivalents
Receivables
Other current Assets
Available-for-sale financial assets
Other Non-Current Assets
Financial Liabilities
Trade and other payables
Short Term Borrowings
Financial Assets
Cash and cash equivalents
Receivables
Other current Assets
Available-for-sale financial assets
Other Non-Current Assets
Financial Liabilities
Trade and other payables
Short Term Borrowings
30 June 2011
$
ZAR
Total
$
81,620,186
58,316,780
139,936,966
960,104
450,572
6,255,569
750,769
90,037,200
1,987,240
—
1,987,240
338,774
—
—
10,934,696
69,590,250
628,605
476,412
1,105,017
30 June 2010
$
ZAR
—
—
—
—
—
—
756,331
8,621
764,952
—
—
—
—
—
—
—
—
—
1,298,878
450,572
6,255,569
11,685,465
159,627,450
2,615,845
476,412
3,092,257
Total
$
—
—
—
—
—
—
756,331
8,621
764,952
(iii) Other Price Risk
Price risk relates to the risk that the fair value or future cash flows of a financial instrument will fluctuate because
of changes in market prices largely due to demand and supply factors for commodities.
As the Group does not derive revenue from sale of products, the effect on profit and equity as a result of changes
in the price risk is not considered material. The fair value of the mining projects will be impacted by commodity
price changes (predominantly iron ore, nickel and uranium) and could impact future revenues once operational.
However, management monitors current and projected commodity prices.
79
JUPITER MINES LIMITED annual report 2011
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i
JUPITER MINES LIMITED annual report 2011
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDING 30TH JUNE 2011
Note 31: Financial Instruments (cont’d)
(d) Net Fair Value
The net fair values of cash and cash equivalents and non-interest bearing monetary financial assets and liabilities
approximates their carrying value. The net fair value of financial assets and financial liabilities is based upon
market prices where a market exists or by discounting the expected future cash flows by the current interest rates
for assets and liabilities with similar risk profiles.
Listed equity investments have been valued by reference to market prices prevailing at reporting date.
Financial Assets
Cash at bank (i)
Trade and other
receivables (i)
Other current Assets
Available for sale financial assets (ii)
2011
2010
Carrying
Amount
Net Fair Value
Carrying
Amount
Net Fair Value
139,936,966
139,936,966
6,777,788
6,777,788
1,298,878
450,572
6,255,569
1,298,878
450,572
6,255,569
103,036
103,036
—
—
9,002,615
9,002,615
Other Non-Current Assets
11,696,632
11,696,632
—
—
159,638,617
159,638,617
15,883,439
15,883,439
Financial Liabilities
Trade and other
payables (i)
Short Term Borrowings
2,615,845
476,412
3,092,257
2,615,845
476,412
3,092,257
764,952
764,952
—
—
764,952
764,952
The fair values in the above table have been determined based on the following methodology:
(i) Cash and cash equivalents, trade and other receivables and trade and other payables are short-term investments
in nature whose carrying value is equivalent to fair value. Trade and other payables exclude amounts provided for
annual leave which is not considered a financial instrument
(ii) For listed available-for-sale financial assets, closing quoted bid prices at the end of the reporting period are used.
Unlisted available-for-sale financial assets are recorded at cost.
82
annual report 2011 JUPITER MINES LIMITED
Financial Instruments Measured at Fair Value
The financial instruments recognised at fair value in the statement of financial position have been analysed and
classified using a fair value hierarchy reflecting the significance of the inputs used in making the measurements.
The fair value hierarchy consists of the following levels:
— quoted prices in active markets for identical assets or liabilities (Level 1);
— inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either
directly (as prices) or indirectly (derived from prices) (Level 2); and
— inputs for the asset or liability that are not based on observable market data (unobservable inputs) (Level 3).
Group – as at 30 June 2011
Financial Assets
Available for sale financial assets:
Level 1
$
Level 2
$
Level 3
$
Total
$
6,255,569
6,255,569
-
-
-
-
6,255,569
6,255,569
Included in Level 1 of the hierarchy are listed investments. The fair values of these financial assets have been based
on the closing quoted bid prices at reporting date, excluding transaction costs.
83
JUPITER MINES LIMITED annual report 2011
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDING 30TH JUNE 2011
Note 32: Parent company information
ASSETS
Current Assets
Non-Current Assets
TOTAL ASSETS
LIABILITIES
Current Liabilities
Non-Current Liabilities
TOTAL LIABILITIES
NET ASSETS
EQUITY
Contributed equity
Reserves
Accumulated losses
TOTAL EQUITY
FINANCIAL PERFORMANCE
Loss for the year
Other comprehensive income
TOTAL COMPREHENSIVE LOSS
Contingent Liability
Refer to Note 25.
Contractual Commitments
Consolidated Group
2011
$
2010
$
82,946,971
351,622,741
434,569,712
6,891,965
21,657,984
28,549,949
2,100,569
11,092
2,111,661
868,005
7,193
875,198
432,458,051
27,674,751
456,510,087
1,107,807
(25,159,843)
432,458,051
46,928,586
3,937,373
(23,191,208)
27,674,751
(1,968,638)
(2,639,866)
(4,608,504)
(2,579,617)
(382,681)
(2,962,298)
As at 30 June 2011 the parent company had exploration contractual commitments of $4,425,775, refer to Note 24.
Note 33: Company Details
The registered office and principle place of business of Jupiter is:
Jupiter Mines Limited
Suite 3, Level 42
108 St Georges Terrace
Perth WA 6000
84
annual report 2011 JUPITER MINES LIMITED
DIRECTORS’ DECLARATION
The Directors of Jupiter Mines Limited declare that:
1.
the financial statements, notes and the additional disclosures included in the Directors’ report designated as
audited, of the consolidated entity are in accordance with the Corporations Act 2001 including:
(a) complying with Accounting Standards (including the Australian Accounting Interpretations) and the
Corporations Regulations 2001; and
(b) give a true and fair view of the financial position as at 30 June 2011 and of the performance for the year
ended on that date of the company and consolidated entity;
2. The financial statements and notes also comply with International Financial Reporting Standards as
disclosed in note 1.
3. There are reasonable grounds to believe that Jupiter Mines Limited will be able to pay its debts as and when
they become due and payable.
4. 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 2011.
Signed on behalf of the Board of Directors
Brian P Gilbertson
London
29 September 2011
85
JUPITER MINES LIMITED annual report 2011
INDEPENDENT AUDIT REPORT
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Grant Thornton Australia Limited is a member firm within Grant Thornton International Ltd. Grant Thornton International Ltd and the member firms are not a worldwide partnership. Grant Thornton Australia Limited, together
with its subsidiaries and related entities, delivers its services independently in Australia.
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annual report 2011 JUPITER MINES LIMITED
INDEPENDENT AUDIT REPORT
87
JUPITER MINES LIMITED annual report 2011
INDEPENDENT AUDIT REPORT
88
annual report 2011 JUPITER MINES LIMITED
ADDITIONAL INFORMATION FOR LISTED COMPANIES
SHAREHOLDER INFORMATION
Shareholder Information required by the ASX Limited (ASX) Listing Rules and not disclosed elsewhere in the Report is set
out below. All information is correct as at 9 September 2011.
Substantial shareholders
The following shareholders have notified the Company that pursuant to the provisions of section 671B of the Corporations
Act they are substantial shareholders.
Name
POSCO Australia Pty Ltd
Pallinghurst Steel Feed (Dutch) B V
Investec Bank Limited
EMG Jupiter L.P
HJM Jupiter L.P
FRK Jupiter L.P
Number of fully paid ordinary shares
327,210,775
301,020,834
275,836,647
246,674,875
125,545,747
125,545,746
%
17.95
16.51
15.13
13.53
6.89
6.89
Number of security holders and securities on issue
Quoted equity securities
Jupiter has issued 1,823,490,746 fully paid ordinary shares and these are held by [*] shareholders
Voting rights
Ordinary shares
The voting rights attached to ordinary shares are that on a show of hands, every member present, in person or proxy, has
one vote and upon a poll, each share shall have one vote.
Options
Option holders do not have any voting rights on the options held by them.
Distribution of security holders
Category
Range
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 50,000
50,001 - 100,000
100,001 and over
Total
Holders
80
503
513
925
204
228
2,453
Fully paid Ordinary shares
Shares
35,477
1,643,570
4,502,739
23,838,704
16,273,366
1,777,196,890
1,823,490,746
%
0.00
0.09
0.25
1.31
0.89
97.46
100.00
Unmarketable parcel of shares
The number of shareholders holding less than a marketable parcel of ordinary shares is 98.
89
JUPITER MINES LIMITED annual report 2011
ADDITIONAL INFORMATION FOR LISTED COMPANIES
On market buy-back
There is no current on market buy-back.
Twenty largest shareholders
Details of the 20 largest shareholders by registered sharehold
Name
POSCO Australia Pty Ltd
Pallinghurst Steel Feed (Dutch) B V
Investec Bank Limited
EMG Jupiter L.P
HJM Jupiter L.P
FRK Jupiter L.P
Red Rock Resources PLC
National Nominees Limited
Pallinghurst EMG African Queen L.P
J P Morgan Nominees Australia Limited
Hancock Prospecting Pty Ltd
HSBC Custody Nominees (Australia) Limited
Citicorp Nominees Pty Limited
Mr Priyank Thapliyal
UBS Nominees Pty Ltd
J P Morgan Nominees Australia Limited
AMP Life Limited
Gaffwick Pty Limited
EST Shirley Watson
Cong Ming Limited
Total
No. of shares
327,210,775
301,020,834
275,836,647
246,674,875
125,545,747
125,545,746
74,200,832
47,731,969
42,857,143
22,462,415
19,191,954
15,862,915
14,522,888
11,727,080
8,356,715
7,953,440
6,904,187
5,714,285
5,000,000
4,321,355
%
17.95
16.51
15.13
13.53
6.89
6.89
4.07
2.62
2.35
1.23
1.05
0.87
0.80
0.64
0.46
0.44
0.38
0.31
0.27
0.24
1,688,641,802
92.62
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
90
annual report 2011 JUPITER MINES LIMITED
NOTES
91
JUPITER MINES LIMITED annual report 2011
NOTES
92
Jupiter Mines Limited
www.jupitermines.com