Kalium
LAKES
CONSOLIDATED
ANNUAL REPORT
2017/18
Kalium Lakes Limited I ABN 98 613 656 643 CORPORATE DIRECTORY
COMPANY
Kalium Lakes Limited (ABN: 98 613 656 643)
DIRECTORS
Mal Randall - Non-Executive Chairman
Brett Hazelden - Managing Director
Brendan O’Hara - Non-Executive Director
Rudolph van Niekerk - Executive Director
CHIEF FINANCIAL OFFICER
Chris Achurch
JOINT COMPANY SECRETARIES
Chris Achurch and Gareth Widger
REGISTERED OFFICE
Unit 1, 152 Balcatta Road
Balcatta WA 6021
WEBSITE AND EMAIL
Email: info@kaliumlakes.com.au
www.kaliumlakes.com.au
AUDITORS
RSM
Level 32, Exchange Tower
2 The Esplanade
Perth WA 6000
GPO Box R1253
Perth WA 6844
SHARE REGISTRY*
Computershare Investor Services Pty Ltd
Level 11, 172 St Georges Terrace
Perth WA 6000
Phone (within Australia): 1300 850 505
Phone (outside Australia): +61 3 9415 4000
SOLICITORS
DLA Piper Australia
Level 31, Central Park
152-158 St Georges Terrace
Perth WA 6000 Australia
HOME EXCHANGE
Australian Securities Exchange
Level 40, Central Park,
152-158 St Georges Terrace
Perth WA 6000
ASX CODE
KLL
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KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
CONTENTS
CHAIRMAN’S ADDRESS
MANAGING DIRECTOR’S OVERVIEW
PROJECT SUMMARY
BEYONDIE SOP PROJECT
CARNEGIE POTASH PROJECT
COMPANY SUMMARY
KEY RISKS
DIRECTORS’ REPORT
CORPORATE GOVERNANCE STATEMENT
AUDITOR’S INDEPENDENCE DECLARATION
CONSOLIDATED STATEMENT OF PROFIT AND LOSS AND
OTHER COMPREHENSIVE INCOME
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
CONSOLIDATED STATEMENT OF CASH FLOWS
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
DIRECTORS’ DECLARATION
INDEPENDENT AUDITOR’S REPORT
ADDITIONAL INFORMATION FOR PUBLIC LISTED COMPANIES
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KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
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KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 CHAIRMAN’S ADDRESS
Dear Shareholder
On behalf of the Board and
Management, as the Chairman of Kalium
Lakes Limited (KLL), I am pleased to
present the Company’s second Annual
Report as a public company.
This report covers the first full financial year since
listing on the Australian Securities Exchange in
December 2016. Established in 2014, our Company
is today poised to become Australia’s first Sulphate
Of Potash (SOP) producer from a sub-surface brine
deposit at the Beyondie Sulphate Of Potash Project,
located in the Pilbara Region of Western Australia. It
is important to note that Australia imports 100% of its
potash requirements.
Involving an evaporation and processing operation
our aim is to initially produce 82,000 tonnes of SOP
per annum, before ramping up to 164,000 tonnes per
annum full scale SOP production facility.
Since my previous Chairman’s Address, I am pleased to
report that Kalium Lakes has recorded many significant
achievements, with the team continuing its enviable
record of completing each milestone on time and
within budget. Simply put, we have done what we said
we would do.
Some of the most significant milestones were:
► Completion of the Bankable Feasibility Study in
September 2018
► 90% increase in Ore Reserves
► Execution of an Offtake Terms Sheet with K+S for
100% of Phase 1 SOP production
► Successful Large Scale Pilot Pond and Purification
Trials
► $14.6 million capital raise via share placement
and share purchase plan (led by Macquarie and
BurnVoir)
► Successfully completed the Pre-Feasibility Study in
October 2017
► Carnegie Joint Venture Scoping Study completed
Our company has remained true to the philosophy
of a gated project evaluation and pilot testing focus,
to ensure the key project success factors are tested
prior to full scale development. As a result, the
achievements of the operational team during the past
year have been very impressive.
Kalium Lakes continues on its path to become a
genuine international “agri-resource” company,
preparing to produce the premium agricultural fertiliser
SOP from its tenements 160 kilometres south east of
Newman in Western Australia.
As a premium potassium fertiliser, SOP is a source of
one of three major nutrients that plants require for
healthy plant metabolism, development of strong roots,
stalks and stems and at the same time enhancing the
appearance, taste, nutritional value and shelf life of
harvested crops.
With the demand for premium fertiliser predicted to
continually increase as the world population grows and
the many developing nations increase consumption of
various meat and food crops, forecasts for SOP sales
remain positive.
The ability to harness Australia’s capacity to deliver
a secure agricultural supply chain for domestic
and export markets, as well as the close proximity
to transport infrastructure (roads and port) of the
Beyondie SOP Project, are vital attributes in developing
a successful and profitable SOP production business.
Both our Directors and the management team
remain focussed on delivering investment returns to
Kalium Lakes’ shareholders and stakeholders. The
achievements during the past 12 months reflect the
determination and practical, hands-on involvement of
the small and dedicated team at Kalium Lakes.
I congratulate and sincerely thank our employees, led
by Managing Director, Brett Hazelden, for once again
successfully meeting each significant new target and
building on the achievements of the previous year.
Finally, on behalf of the Board, I take this opportunity
to express our appreciation to our increasing number
of loyal shareholders who clearly recognise the future
potential of our company
Yours faithfully
Malcolm Randall
Non-Executive Chairman
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KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 MANAGING DIRECTOR’S OVERVIEW
The 2018 Financial Year has undoubtedly
been the most significant in the
short history of Kalium Lakes Limited
(KLL). The Company, which started
operations as Kalium Lakes Potash Pty
Ltd in October 2014, was incorporated
as a public company on 14 July 2016
and listed on the Australian Securities
Exchange in December 2016.
The team at KLL has been busy developing a strong,
flexible and successful public business based on the
foundations carefully put in place during its time as
a private company. The corporate and site based
activities involved in developing the Beyondie Sulphate
Of Potash Project (BSOPP) have now reached the
point where Kalium Lakes has completed a Bankable
Feasibility Study (BFS) and is reviewing the project
financing options prior to a Final Investment Decision.
In summarising the activities undertaken during the
financial year, this overview records many important
achievements and also demonstrates the effectiveness
a small, completely committed team has had in
continuing the momentum for the Kalium Lakes
business.
July 2017 to September 2018
(including subsequent events)
BANKABLE FEASIBILITY STUDY AND ORE RESERVE
Building on the success of the previous year Kalium
Lakes is pleased to be the first Australian based SOP
Resource to present a Bankable Feasibility Study and
an Ore Reserve.
The announcement of the completion of the Bankable
Feasibility Study (full details appear later in this report)
in September 2018 represented the culmination of 12
months of intense activity throughout the business.
The results of the BFS confirmed that the BSOPP, is
technically and financially robust, with production
anticipated in 2020.
The Study also delivered a 90% increase in Ore
Reserves, based solely within the Stage 1 Approval
Footprint, which represents less than a quarter of total
lake surface area within the tenement package.
The BSOPP is one of Australia’s highest grade SOP
brine deposits with a Proved Reserve of 1.65 Mt @
13,830 mg/l SOP at a cut-off grade of 2,500mg/l K and
Probable Reserve of 3.49 Mt @ 11,820 mg/l SOP at a cut-
off grade of 2,500mg/l K.
RESOURCE UPGRADE AND DRILLING
Earlier in September 2018 the analysis of additional
data compiled from its ongoing, industry leading,
hydrogeological data collection program had delivered
a 150% increase in the Beyondie SOP Project’s
Measured and Indicated Resources. This set the
Measured Resource as 1.72 Mt @ 11,488 mg/l SOP and
the Indicated Resource as 9.17 Mt @ 12,459 mg/l SOP.
Earlier, in May 2018, KLL had announced that the main
BFS sonic monitoring bore installation and air-core
geological programs had been successfully completed
at the BSOPP.
The 8,504m drill program continued to confirm the PFS
Resource and Reserve Assumptions, reaffirming the
Project’s high grade potassium results and indicating
new aquifer targets. It delivered Potassium results up
to 11,100 mg/L - equivalent to a SOP grade of 24,736
mg/L.
Additional assay results from auger holes located in
the eastern tenements Resource Area, which comprise
Stage 2 of the Project, were announced in late August
2017. Importantly, the potassium grades are consistent
with results obtained from the same locations two
years previously.
Throughout this year Kalium Lakes continued to work
closely with K-UTEC AG Salt Technologies
(K-UTEC) to prepare Technical Reports according to the
guidelines of the JORC Code with reference to the CIM
Best Practice Guidelines, for Resource and Reserve
Estimation for Brines.
Through the adoption of both the JORC Code and the
Canadian Institute of Mining, Metallurgy and Petroleum
(CIM) NI 43-101 standard of disclosure for the reporting
of Mineral Resources, Kalium Lakes recognised that the
CIM has developed best practice guidelines for Mineral
Resource and Reserve estimation of Brines.
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KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
Large Scale Pilot Trials
PURIFICATION PLANT
Kalium continued to utilise K-UTEC to undertake
purification plant works, including multiple phases
of bench and pilot scale optimisation tests utilising
harvested salts from the BSOPP pilot evaporation
ponds.
The Company was also able to provide an update in
relation to duplicated testwork optimisation at the
Saskatchewan Research Council (SRC) in Canada for the
Purification Plant completed during February 2018.
The duplicated laboratory trials at both K-UTEC in
Germany and SRC in Canada have continued to
optimise process flow sheet design. The testwork
program has continued to build on the previous work
completed in the PFS, with optimisation works for batch
recovery trials within the processing plant using more
than one tonne of BSOPP harvested salts to achieve
individual recoveries of between 90% to 98%.
Project Financing
FINANCIAL INSTITUTIONS
During April 2018, the Company provided an update
on its progress with preparations on project finance
advising that it has received Expressions Of Interest
(EOIs) from a number of domestic and international
financial institutions associated with debt funding for
the Project.
KLL has continued evaluating these EOIs and is working
with the respective financial institutions to complete
relevant due diligence and credit approval process,
following the completion of the BFS.
EVAPORATION PONDS
Commissioning of the Large Scale Pilot Evaporation
Ponds commenced in August 2017, with brine being
pumped from existing production bores into the pilot
ponds.
The Large Scale Pilot Evaporation Pond program
reflected KLL’s development strategy, where a staged
development approach is preceded by a pilot program
to verify current assumptions and operational
parameters along with production of bulk samples for
purification plant purposes. This trial program was
based at the Beyondie, 10 Mile and Sunshine areas of
the BSOPP.
Kalium Lakes has investigated both on-lake and off-
lake pond location options and made the informed
decision to move off-lake. One of the key reasons
behind this decision is the requirement for the ponds
to be tiered to be able to achieve a continuous gravity
flow from one pond to the next. Operating heavy
earthmoving equipment on the playa lake over a large
area was also determined to be impractical, due to
the boggy nature of the lake surface along with the
high leakage rates observed and associated potassium
recovery losses. Finally, on-lake ponds effectively
sterilise areas of the lake surface from being able to
extract the brine resource via trenching.
At the beginning of September 2017 first salts
commenced precipitating in the large scale pilot ponds.
The Company also informed the market of the cost
of installing lined evaporation ponds and that the
total cost of installing lined evaporation ponds at the
BSOPP is only about 10-20% of the total capital cost
requirement of the Project. This cost is based on the
actual costs achieved during the construction of the
Large Scale Pilot Ponds.
March 2018 saw the announcement of a comprehensive
update on the progress of the Large Scale Pilot
Evaporation trials at the BSOPP and included
invaluable insight from the representative scale trials.
Those trials had, to that point, involved the pumping
of 164 million litres of brine since pump testing began,
of which 83 million litres of brine have been pumped
into the trial ponds. More than 10,000 tonnes of salts
had been produced since the first brine entered the
system in August 2017, including 3,160 tonnes of mixed
potassium salts which, if processed, would generate
approximately 520 tonnes of SOP.
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
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KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 MANAGING DIRECTOR’S OVERVIEW (CONTINUED)
NAIF
GERMAN EXPORT CREDIT AGENCY
The announcement, in September 2018, that
the Australian Government’s Northern Australia
Infrastructure Facility (NAIF) has indicated it will
investigate the potential for it to provide debt finance
for the BSOPP and associated infrastructure of benefit
to nearby pastoral stations, resource companies and
indigenous communities, presents the first milestone in
KLL’s engagement with NAIF.
NAIF is a major long term initiative of the Australian
Government. NAIF provides access to up to A$5 billion
of finance which may be on concessional terms to
support infrastructure development that generates
public benefit for northern Australia. It also seeks to
encourage and complement private sector investment to
further that objective.
The next step for KLL is the submission of a formal
Investment Proposal. NAIF has not made any decision
to offer finance or made any commitment to provide
any financial accommodation and there is no certainty
that an agreement will be reached between the parties.
KLL will continue to assist NAIF with its required due
diligence investigations regarding participation in
the debt facilities that will fund the project capital
expenditure necessary to develop the Beyondie SOP
Project.
A positive preliminary assessment decision by the
German Government Inter-Ministerial Committee
regarding its export credit project finance application
with Euler Hermes Aktiengesellschaft (Hermes), the
appointed export credit agency that administers
the German Export Credit Agency (ECA) scheme for
the German Government, represented an important
milestone in the process to approve Kalium Lakes’ ECA
application Approximately A$42 million of the Beyondie
Sulphate Of Potash Project capital expenditure is
expected to qualify under the German ECA cover.
Environmental Approvals
Early in February Kalium Lakes received notifications
under the Environmental Protection Act 1986 (WA) from
the Environmental Protection Authority of Western
Australia (EPA) and the Environment Protection and
Biodiversity Conservation Act 1999 (Cth) from the
Australian Department of the Environment and Energy
(DotEE), for BSOPP.
Those notifications covered the Stage 1 area of the
BSOPP which, in turn reflected the development base
case as outlined in the PFS.
The EPA advised, in November 2017, that the level of
assessment is an “Environmental Review – no public
review, with a proponent prepared Environmental
Scoping Document (ESD)”. Kalium Lakes has provided
the draft ESD and has received comments back from
the EPA. After the ESD has been finalised and an
2017 / 2018 ASX Significant Announcement and Subsequent Events Timeline
High Grade Potassium
Bore Results Continue
$1.88M R&D Tax Offset Received
Carnegie Potash Project
Prospectivity Confirmed
Consistent High
Grade Auger Results
CFO Appointment and
Debt Financing commences
Second Native Title
Agreement Signed
JUL
AUG
SEP
OCT
NOV
DEC
JAN
FEB
Brine Fills Large
Scale Pilot Ponds
Pre-Feasibility Study with
Maiden Ore Reserve
First Salts In Large
Scale Pilot Ponds
EcoMag Limited LOI
Magnesium Carbonate
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$14.6M Share Placement and
Share Purchase Plan
Environmental Level
of Assessment Set
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 MANAGING DIRECTOR’S OVERVIEW (CONTINUED)
Environmental Review Document submitted the EPA
will assess the project and prepare a report and
recommendations for the Minister for Environment.
When the Minister has considered the EPA’s report a
Ministerial Approval Statement can then be issued
pursuant to s45(5) of the Environmental Protection Act
1986 (WA). This sets out the conditions and procedures
that the proponent must adhere to during a project’s
implementation.
The DotEE has provided a referral decision as a
“controlled action, requiring assessment by preliminary
documentation”. The assessment is limited to direct
and/or indirect impacts on potential habitat for two
species. The DotEE will provide a request for additional
information and when the DotEE is satisfied that KLL
has provided sufficient information it will direct KLL to
publish the information and commence its assessment
of the Project. The Minister will review the DotEE’s
assessment and may then make the decision to
approve the Project.
Also, in May 2018, KLL received a notice of decision to
Consent to Minor and Preliminary Works under the
Environmental Protection Act 1986 (WA) from the EPA
for the BSOPP.
The notice authorised the works associated with
an upgrade of the site access road involving
construction, operation and maintenance, the
upgrade of the accommodation camp (including the
waste water treatment plant) , the workshop and the
communication towers.
This approval was instrumental in allowing greater
ease of access to and from site, better living conditions,
a larger workshop and more reliable communication
facilities for Kalium Lakes’ personnel and contractors.
Native Title
Kalium Lakes announced that it had signed a Native
Title Agreement with Mungarlu Ngurrarankatja
Rirraunkaja (Aboriginal Corporation) RNTBC (MNR)
covering the eastern tenements of the BSOPP at the
beginning of 2018. MNR is the registered native title
body corporate that holds the native title rights and
interests the subject of the Birriliburu determination
area in trust for the Birriliburu People.
The Company remains committed to building a
mutually beneficial relationship with MNR and the
Birriliburu People through effective engagement,
consultation and communication. The Native Title
Agreement also provides opportunities for MNR and the
Birriliburu People to participate in the BSOPP, as well as
a future royalty stream.
Kalium Lakes signed a Native Title Agreement with the
Gingirana People in March 2016 that will also lead to
opportunities for all parties involved and provides a
firm foundation for a long term relationship.
This second Native Title Agreement provided the
certainty that allows the Company to develop both
Stage 1 and the subsequent Stage 2 of the Project.
Mining Tenure
Applications Submitted
Pilot Pond and
Harvest Trial Update
Purification Plant
Recovery Optimisation
CFO Transition and
Financing Update
Beyondie SOP
Project Mining
Leases Granted
Carnegie Successful Drilling
and Evaporation Tests
Significant
Resource
Upgrade
Carnegie Scoping
Study Completed
NAIF Financial
Support Potential
MAR
APR
MAY
JUN
JUL
AUG
SEPT
OCT
WA Salt
Group LOI to
evaluate NaCl
BFS Exploration Drill
Program Complete
Offtake Terms
Sheet Signed
with K+S
Successful EcoMag Magnesium Pilot Trials
EPA Minor Preliminary
Works Consent
German ECA
Mining Tenure
and Mining
Proposal
Approved
BFS
Complete
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KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 MANAGING DIRECTOR’S OVERVIEW (CONTINUED)
Offtake Agreement K+S
Perhaps the most significant announcement of the
year occurred on 18 June 2018, when Kalium Lakes
announced it had executed an Offtake Terms Sheet
with German fertiliser producer and distributor K+S, one
of the top potash providers worldwide and the world’s
largest salt producer, for 100% of Phase 1 production
from the BSOPP, representing a major milestone for the
Company.
The Offtake Terms Sheet proposed that Kalium Lakes
will supply SOP to K+S over an initial 10 year term and
K+S intends to provide the Company with expertise and
technical support during development.
The offtake arrangement is subject to the parties
agreeing and entering into a formal binding offtake
agreement with terms consistent with the Terms Sheet
and the satisfaction of certain conditions precedent
including, but not limited to, completion of due
diligence by K+S.
Pre-Feasibility Study
The announcement of the PFS results in the first week
of October 2017 confirmed that the Beyondie SOP
Project, is both technically and financially robust. At
that time, the results set a Maiden Probable Reserve
of 2.66 Mt @ 14,210 mg/l SOP at a cut-off grade of
3,500mg/l K based solely within the Stage 1 Approval
Footprint.
Other Activities
CAPITAL RAISE
Late in November 2017 the Company conducted an
institutional placement, together with a share purchase
plan, which raised a total of $14.6 million (before costs),
which was used to to fund the completion of the
Bankable Feasibility Study (BFS) and to provide
working capital.
Mining Leases / Department of Mines, Industry
Regulation and Safety
In February 2018, Kalium Lakes submitted applications
pursuant to the Mining Act 1978 (WA) for two Mining
Leases and a number of ancillary Miscellaneous
Licences. The applications covered the Stage 1 area
the BSOPP and were a significant milestone for the
Company, representing the culmination of more than
three years of detailed work, associated with technical
and environmental studies, as well as Native Title and
government consultation.
Four months later, in June 2018, the Hon. Bill Johnston
MLA, Minister for Mines and Petroleum, pursuant to the
Mining Act 1978 (WA), granted the two Mining Leases for
the BSOPP.
The granting of mining tenure unlocked the next
significant steps for the company, including proceeding
with Mining Proposal submissions, approvals with
the Department of Mines, Industry Regulation and
Safety (DMIRS), as well as the Department of Water
and Environmental Regulation’s (DWER) Part V Works
Approval requirements.
In August 2018, Kalium Lakes announced that all of
the key Miscellaneous Licence Applications for the
Project allowing for the development of the following
supporting infrastructure; gas pipeline, water pipeline,
power line, bridge/culverts, search for groundwater,
taking water, meteorological station, communications
facility, drainage channel, pump station, mine site
accommodation facility, bore and borefield, water
management facility, power generation, storage and
transport facility for mine concentrate, mine site
administration facility, workshop and storage facility,
had been granted.
During the same month the Company also confirmed
receipt of Consent to Minor and Preliminary Works by
the EPA and the assessment and approval of the Mining
Proposal and Mine Closure Plan by the DMIRS. The
approvals allow for the construction, operation and
maintenance of:
► Site access road upgrade;
► Upgrade of the accommodation camp, including
waste water treatment plant;
► Workshop upgrade; and
► Upgrade of communication towers.
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KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 CARNEGIE JOINT VENTURE
Next Steps
In July 2018 the Joint Venture announced the results of
the Scoping Study, Maiden Resource and Exploration
Target, confirming the Carnegie Potash Project has the
potential to be a technically and economically viable
project (full details appear later in this Annual Report).
MAGNESIUM BY-PRODUCTS
In July 2017, KLL announced it had signed a Letter
of Intent (LOI), on an exclusive basis in relation to
Western Australian based potash project developers,
with EcoMag Limited (EcoMag) to trial the recovery of
Hydrated Magnesium Carbonate (HMC) as part of the
large scale pilot pond works.
EcoMag is the developer of a process for recovering
magnesium-based materials from brines and bitterns,
including HMC, which is used in the manufacture of
chemically-toughened glass and fire retardants.
A successful EcoMag pilot plant trial, processing
residual brines to recover high purity HMC, was
announced in February 2018. The trials, undertaken
at EcoMag’s facility in Karratha, confirmed initial
laboratory works completed during 2017 and produced
99.5% pure HMC, with overall magnesium recovery
exceeding 95%.
WA SALT
March 2018 saw Kalium Lakes announce that it had
signed a Letter of Intent with WA Salt Koolyanobbing
Pty Ltd, part of the WA Salt Group (WA Salt), to evaluate
and assess the recovery of Sodium Chloride (NaCl) salt
products from the BSOPP. The WA Salt Group, which
produces high quality salt products for domestic and
international customers, is now working with Kalium
Lakes to determine which types of NaCl products can
be recovered from the BSOPP and may be suitable for
both local and international markets.
Kalium Lakes is proud to be the first Sulphate Of Potash
developer to complete a Bankable Feasibility Study and
to present a set of compelling technical and economic
outcomes, to both investors and financial institutions.
The Project, centred on an Australian deposit with an
initial mine life of between 30 to 50 years, has been
designed to be a low cost, long life and high margin
producer.
Looking forward the key next steps for Kalium Lakes are:
► Commence Early Works Construction Activities
► Commence Front End Engineering and Design (FEED)
► Finalise Binding Offtake Agreements
► Award EPC/M and Lump Sum Contracts
► Primary Project Approvals Anticipated
► Finance Due Diligence Completion
► Project Financing Completion
► Final Investment Decision (FID)
► Full Construction Activities
► Commissioning and Ramp Up to Name Plate
Throughput
Founded in October 2014, Kalium Lakes has now
invested more than A$30 million in the exploration
and development of the Beyondie SOP Project and I
wish to thank our key consultants and employees for
the quality work undertaken. We now look forward the
next challenges of project financing, final approvals ,
construction and first production.
By continuing to do the detailed pilot trials, engineering
design and approvals work, Kalium Lakes is well on
track to achieve its goal of assisting Australian farmers
through the delivery of an agronomically superior
product, while ensuring a satisfactory return to our
shareholders for more than three decades.
Brett Hazelden
Managing Director and Chief Executive Officer
18 October 2018
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KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
PROJECT SUMMARY (CONTINUED)
Review Of Operations
The Company holds rights to granted tenure of more than 3,000 square kilometres, as
well as further tenement applications at the eastern margin of the East Pilbara region
of Western Australia, as shown in the map below.
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► Kalium Lakes Potash Tenement Portfolio
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 BEYONDIE SOP PROJECT
Sulphate Of Potash Project Production Process
Sulphate of Potash (SOP) is a widely-used agricultural
fertiliser with annual global consumption of 6.6Mtpa.
Australia currently imports 100% of its potash
requirements from overseas producers.
SOP can be produced by extracting brine (hypersaline
water) from underground, then evaporating the water
to precipitate mixed potassium salts which are, in turn,
purified to produce the SOP fertiliser, as illustrated in
the flow diagram below:
(a) Brine Pumping: brine is extracted from basal sands
(or the lower aquifer) using submersible bores,
as well as pumping of trenches from the upper
aquifer;
(b) Brine Solar Evaporation: brine is pumped to
solar evaporation ponds where it sequentially
precipitates calcium, sodium, potassium and
magnesium mixed salts in separate ponds;
(c) Salt Harvesting: the mixed potassium salts that
have crystallized from the solar evaporation ponds
are mechanically harvested and stockpiled;
are then separated from halite via flotation. The
resultant schoenite slurry undergoes thermal
decomposition into SOP; and
(e) SOP Fertiliser: after drying and compaction in a
purification plant, the SOP is ready to be sold and
used as a final product.
Beyondie sulphate of Potash Project
KLL is an exploration and development company
focused on developing the 100% Owned Beyondie
Sulphate Of Potash Project (BSOPP) in Western
Australia with the aim of commencing production at
82ktpa of Sulphate Of Potash (SOP) before ramping up
to 164ktpa of SOP for domestic and international sale.
The Project covers an area of approximately 2,400
square kilometres, comprising 15 granted exploration
licences, 10 granted miscellaneous licences, two
granted mining leases and three miscellaneous
licence applications. Kalium Lakes intends to
develop a sub-surface Brine deposit to produce a
SOP product, by undertaking an evaporation and
processing operation 160 kilometres (km) south east
of Newman.
(d) Purification Processing: the mixed potassium
salts are fed into a purification plant facility where
the potassium salts are converted into schoenite
through a conversion and recycling process and
KLL has completed a Bankable Feasibility Study
(BFS) which confirmed the BSOPP is technically and
financially robust, with production anticipated in
2020.
Simple SOP Production Process
Brine Pumping from Bores and Trenches
>260 Million litres successfully pumped to date
Brine Solar Evaporation
Located in high evaporation region
Salt Harvesting
Low cost well proven process in Western Australia
Agriculture Production
Australian and Asian Markets
Premium SOP Fertiliser
High demand, preferred source of
potassium for agricultural industry
Purification Processing
Using established German SOP technology
1
► SOP Production Process
13
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 BEYONDIE SOP PROJECT
The BFS has been prepared by KLL in conjunction
with leading industry specialists including K-UTEC,
DRA Global, Advisian, Shawmac, Wyntak and Preston
Consulting as the principal technical consultants,
as well as RSM, DLA Piper Australia, HopgoodGanim
Lawyers and BurnVoir Corporate Finance as
accounting, legal, commercial and financial advisors.
Kalium Lakes adheres to the JORC 2012 Code and
the Canadian Institute of Mining, Metallurgy and
Petroleum Best Practice Guidelines for Resource and
Reserve Estimation for Brines (CIM Guideline).
In addition, the Company is part of the Association
of Mining and Exploration Companies (AMEC) Potash
Working Group which has developed guidelines to
define a brine Mineral Resource and Ore Reserve,
in order to increase the certainty, clarity and
transparency in reporting of these resources.
Kalium Lakes undertakes a gated project investment
evaluation process that is accepted as industry
best practice as illustrated below. The BFS aims
to present information at the necessary level of
definition and accuracy in accordance with the
JORC Code and the AACE International® guidelines
for developing a Class 3 (Bankable / Definitive
Feasibility Study) estimate.
There are two separate phases within the Stage
1 Approval Footprint, the first phase containing
the construction and operation of a 82 ktpa SOP
Demonstration Scale Project Development, with
the second phase containing the ramping up to a
164 ktpa SOP Full Scale Project Development, to
minimise operational and financial risk.
Phase 1 Demonstration Scale Project Development
– 82 ktpa SOP Production:
► Installation of ~445 ha evaporation and crystalliser
ponds at the Beyondie-10 Mile area and Lake
Sunshine area;
► Installation of 40 production bores and 9 trenches
totalling 58 km at 10 Mile and Lake Sunshine;
► Installation of 82 ktpa SOP purification facility;
► 78 km of access road widening, realignment and
construction;
► Installation of 60 person accommodation, buildings,
services and utilities as required;
► Installation of communications tower for microwave
internet and two way radio;
► Construction of power station;
► Installation of freshwater borefields at 10 Mile South;
► Use of the Main Roads WA network from the
Kumarina Road house located on the Great Northern
Highway to the various WA depots and Fremantle,
Kwinana and Geraldton Ports for product delivery;
► Backloaded haulage of product to Perth/Fremantle
and Geraldton;
► Use of Fremantle, Kwinana and Geraldton Port
Facilities to access export markets to Asia and the
Eastern States of Australia; and
2016
2017
2018
2019
2020
14
► Kalium Lakes Gated Investment Evaluation Process
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 ► Phase 2 Full Scale Project Development – 164 ktpa
► Extended Mine Life In Excess of 30 years: Based
SOP Production:
► Installation of additional evaporation and crystalliser
ponds at the Beyondie – 10 Mile and Lake Sunshine
areas;
► Expansion and duplication of purification plant;
► Installation of additional production bores and
trenches at the western and eastern lakes;
► Expansion of site buildings, services and utilities as
required;
► Expansion of port export facilities, including bulk
export facilities at Geraldton Port;
► Installation of freshwater borefields at Kumarina and
Beyondie;
► Installation of a 78 km Natural Gas pipeline to the
purification facility at the 10 Mile area.(Phase 1 or
Phase 2 TBC).
Bankable Feasibility Study – Key Highlights
The key elements of the BFS are:
on production of 164ktpa SOP, the extended mine
life represents an increase of seven years on the
PFS estimated mine life. The Economic Evaluation
excludes any production post 30 years from the Base
Case Mine Plan.
► Improved Financial Outcomes for the Base Case:
► Pre-tax NPV8 A$575M, IRR of 20%
► Average EBITDA of A$116Mpa, EBITDA margin of
61%
► A payback period of 7 years and Life of Mine
(LOM) 30 years
► Free cash flows of more than +A$2B
► Based on CRU forecast US$606/t nominal
average LOM SOP @ $A/$US exchange rate of
0.73.
► Strong Market Fundamentals:
► CRU estimates that average CFR Australian prices
in the first year of full production (FY2022) will
be US$530/t with prices rising to US$961-997/t in
2040. CRU forecasts a 2.8%pa growth in SOP.
► 90% Increase in Ore Reserves: Based solely within
the Stage 1 Approval Footprint which represents less
than a quarter of total lake surface area within the
tenement package:
► Kalium Lakes to produce a premium Standard,
Granular and Soluble suite of products at
>51%K2O and <0.5% Chloride. Each product will
attract a different price and premium.
► Proved Reserve of 1.65 Mt @ 13,830 mg/l SOP at
► Offtake Terms Sheet executed with German
a cut-off grade of 2,500mg/l K
► Probable Reserve of 3.49 Mt @ 11,820 mg/l SOP
at a cut-off grade of 2,500mg/l K
► Measured Resource of 1.72 Mt @ 11,488 mg/l SOP
► Indicated Resource of 9.17 Mt @ 12,459 mg/l SOP
► Inferred Resource of 8.75 Mt @ 12,593 mg/l SOP
► Increased Production Rates: The base case outcome
of the BFS for the Beyondie SOP Project is a 164ktpa
SOP operation. This is an increase of 10% on the
Pre-Feasibility Study (PFS) based on (amongst other
matters) an update to the Company’s increased
Ore Reserve, detailed brine extraction modelling,
pilot scale pond and processing outcomes. After
taking into consideration operational, SOP market
and financing risk management perspectives,
the Company has confirmed a phased ramp-up
development scenario, starting with a commercial
demonstration scale 82ktpa SOP operation, before
ramping up to a 164ktpa full scale SOP production
facility.
fertiliser producer and distributor K+S for 100%
of Phase 1 production. The Offtake arrangement
is subject to the execution of a formal binding
offtake agreement and satisfaction of certain
conditions precedent, including completion of
due diligence by K+S.
► Bankable Staged Development Cost Base
► Estimated LOM Operating Cash Cost of A$231/t
SOP FOB Fremantle Port. This will place the
Beyondie SOP Project amongst the lowest cost
global SOP production.
► Pre-production Capital Cost of A$159 million
for the initial 82ktpa phase. A deferred capital
cost of A$125 million is required to ramp up
production to 164ktpa SOP.
► Pricing has been received from contractors and
suppliers for more than 80% of Capex Costs.
► Option to install a gas pipeline at a capital
cost of A$29 million which would result in an
operating costs reduction of A$31-34 per tonne.
15
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 BEYONDIE SOP PROJECT
► Confirmed Approvals Pathway:
► The Company has progressed the process
► Early works approvals are in place from the
Environmental Protection Authority of Western
Australia (EPA) and Department of Mines,
Industry Regulation and Safety (DMIRS), with
formal approval for the full-scale project
anticipated to be in place during Q4 2018.
► Two Native Title Land Access Agreements have
been executed allowing for the consent to the
grant of mining leases, ancillary tenure and
approvals required for the BSOPP.
► Two Mining Leases and 10 Miscellaneous
Licences have been granted for the Beyondie
SOP Project.
► Low Cost Financing Identified:
► The Company is proposing to fund the project
capital expenditure by a combination of up to
60% debt and the residual equity.
for debt financing with initial due diligence
completed and Expression of Interest (EOI) term
sheets received.
► The Company estimates that approximately
A$42 million of the project capital expenditure
is expected to qualify under the German
Export Credit Agency (ECA) scheme which has
received a positive preliminary assessment
decision by the German Government Inter-
Ministerial Committee (IMC) and Euler Hermes
Aktiengesellschaft (Hermes), the appointed
export credit agency that administers
the German ECA scheme for the German
Government.
► Australian Government’s Northern Australia
Infrastructure Facility (NAIF) has provided
written confirmation that the NAIF Board has
considered a Strategic Assessment Paper for
the BSOPP and has consented to the NAIF
Executive continuing its investigation.
16
► Beyondie SOP Project Footprint
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 Beyondie Sulphate of Potash Project - Tenement Interests
Tenement Name
Holder
State
Status
Grant Date
Interest
Exploration Licences
E69/3306
Yanneri-Terminal
E69/3309
Beyondie - 10-Mile
E69/3339
West Central
E69/3340
White
E69/3341
West Yanneri
E69/3342
Aerodrome
E69/3343
E69/3344
E69/3345
E69/3346
E69/3347
E69/3348
E69/3349
E69/3351
E69/3352
L52/162
L52/186
L52/187
L52/190
L52/193
L69/28
L69/29
L69/30
L69/31
L69/32
L69/34
L69/35
L69/36
L69/38
T Junction
Northern
Wilderness
NE Beyondie
South 10 Mile
North Yanneri-Terminal
East Central
Sunshine
Beyondie Infrastructure
Access Road
G N Hwy Access Road
Comms Tower 2
Kumarina FW 1
Kumarina FW 2
Access Road Diversion
Access Road Village
Comms Tower 1
Sunshine Access Road
10MS FW A
10MS FW B
10MS FW C
10MS FW D
Access Road “S” Bend
KLP
KLP
KLP
KLP
KLP
KLP
KLP
KLP
KLP
KLP
KLP
KLP
KLP
KLP
KLP
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
Miscellaneous Licences
KLP
KLP
KLP
KLP
KLP
KLP
KLP
KLP
KLP
KLP
KLP
KLP
KLP
KLP
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
Granted
17-3-2015
Granted
17-4-2015
Granted
22-6-2015
Granted
22-6-2015
Granted
11-8-2015
Granted
22-6-2015
Granted
22-5-2015
Granted
22-5-2015
Granted
22-5-2015
Granted
11-8-2015
Granted
11-8-2015
Granted
11-8-2015
Granted
22-6-2015
Granted
31-8-2015
Granted
31-8-2015
Granted
30-3-2016
Granted
30-5-2018
Granted
30-5-2018
Withdrawn
Granted
13-8-2018
Granted
7-8-2018
Granted
7-8-2018
Granted
30-5-2018
Granted
7-8-2018
Granted
14-8-2018
Granted
14-8-2018
Application
Application
Application
-
-
-
M69/145
M69/146
10 Mile
Sunshine
Mining Leases
KLP
KLP
WA
WA
Granted
6-6-2018
Granted
6-6-2018
Note: Kalium Lakes Potash Pty Ltd (KLP) is a wholly owned subsidiary of Kalium Lakes Limited (KLL)
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
17
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 BEYONDIE SOP PROJECT
Annual Mineral Resources and Ore Reserves Statement - Resources Tables as at 18 October 2018
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* The Kalium Lakes Beyondie SOP Project “Exploration Target” is based on a number of assumptions and limitations and is conceptual in nature. It is not an
indication of a Mineral Resource Estimate in accordance with the JORC Code (2012) and it is uncertain if future exploration will result in the determination of a
Mineral Resource or that the Exploration Target will add to the economics of the BSOPP.
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I
18
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
PROVED ORE RESERVES
Aquifer Type
Production Bores
Total Proved Reserve
Note: Errors are due to rounding.
Brine
Volume
(106 m3)
119
119
PROBABLE ORE RESERVES
K
(mg/L)
K Mass
(Mt)
SO4
(mg/L)
SO4 Mass
(Mt)
SOP Grade
(kg/m3)
K2SO4
Mass (Mt)
6,207
6,207
0.74
0.74
17,945
17,945
2.14
2.14
13.83
13.83
1.65
1.65
Aquifer Type
Lake Surface
Sediments
Production Bores
Total Probable
Reserve
Brine
Volume
(106 m3)
212
83
K
(mg/L)
K Mass
(Mt)
SO4
(mg/L)
SO4 Mass
(Mt)
SOP Grade
(kg/m3)
K2SO4
Mass (Mt)
4,755
1.01
13,669
2.90
10.60
6,713
0.56
18,867
1.56
14.96
2.25
1.24
295
5,306
1.57
15,129
4.46
11.82
3.49
Note: Errors are due to rounding.
ORE RESERVES SUMMARY
Level
Drainable Brine
Volume
(106 m3)
K Grade
(mg/l)
Proved Ore Reserve
Probable Ore
Reserve
Total Ore Reserve
119
295
414
6,207
5,306
5,565
K
(Mt)
0.74
1.57
2.30
SO4
(Mt)
2.14
4.46
6.60
K2SO4
Mass (Mt)
1.65
3.49
5.13
19
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 BEYONDIE SOP PROJECT
Forward-Looking Information
Certain information in this document refers to the
intentions of Kalium Lakes, but these are not intended
to be forecasts, forward looking statements or
statements about the future matters for the purposes
of the Corporations Act or any other applicable law.
The occurrence of the events in the future are subject
to risk, uncertainties and other actions that may
cause Kalium Lakes’ actual results, performance or
achievements to differ from those referred to in this
document. Accordingly Kalium Lakes and its affiliates
and their directors, officers, employees and agents
do not give any assurance or guarantee that the
occurrence of these events referred to in the document
will actually occur as contemplated.
Statements contained in this document, including
but not limited to those regarding the possible or
assumed future costs, performance, dividends, returns,
revenue, exchange rates, potential growth of Kalium
Lakes, industry growth or other projections and any
estimated company earnings are or may be forward
looking statements. Forward-looking statements can
generally be identified by the use of words such
as ‘project’, ‘foresee’, ‘plan’, ‘expect’, ‘aim’, ‘intend’,
‘anticipate’, ‘believe’, ‘estimate’, ‘may’, ‘should’, ‘will’ or
similar expressions. These statements relate to future
events and expectations and as such involve known
and unknown risks and significant uncertainties,
many of which are outside the control of Kalium
Lakes. Actual results, performance, actions and
developments of Kalium Lakes may differ materially
from those expressed or implied by the forward-looking
statements in this document. Such forward-looking
statements speak only as of the date of this document.
20
20
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 Thomas Schicht and Anke Penndorf are full-term
employees of K-UTEC AG Salt Technologies (K-UTEC).
K-UTEC, Thomas Schicht and Anke Penndorf are not
associates or affiliates of Kalium Lakes or any of its
affiliates. K-UTEC will receive a fee for the preparation
of the Report in accordance with normal professional
consulting practices. This fee is not contingent on the
conclusions of the Report and K-UTEC, Thomas Schicht
and Anke Penndorf will receive no other benefit for the
preparation of the Report. Thomas Schicht and Anke
Penndorf do not have any pecuniary or other interests
that could reasonably be regarded as capable of
affecting their ability to provide an unbiased opinion in
relation to the Beyondie Potash Project.
K-UTEC does not have, at the date of the Report,
and has not had within the previous years, any
shareholding in or other relationship with Kalium Lakes
or the Beyondie Potash Project and consequently
considers itself to be independent of Kalium Lakes.
Thomas Schicht and Anke Penndorf have
sufficient experience that is relevant to the style of
mineralisation and type of deposit under consideration
and to the activity being undertaken to qualify as a
Competent Person as defined in the 2012 Edition of the
JORC ‘Australasian Code for Reporting of Exploration
Results, Mineral Resources and Ore Reserves’. Thomas
Schicht and Anke Penndorf consent to the inclusion in
the Report of the matters based on their information in
the form and context in which it appears.
There can be no assurance that actual outcomes
will not differ materially from these statements. To
the maximum extent permitted by law, Kalium Lakes
and any of its affiliates and their directors, officers,
employees, agents, associates and advisers:
► disclaim any obligations or undertaking to release
any updates or revisions to the information to reflect
any change in expectations or assumption;
► do not make any representation or warranty,
express or implied, as to the accuracy, reliability or
completeness of the information in this document,
or likelihood of fulfilment of any forward-looking
statement or any event or results expressed or
implied in any forward-looking statement; and
► disclaim all responsibility and liability for these
forward-looking statements (including, without
limitation, liability for negligence.
Compliance Statement
The information in this document is extracted
from the report titled “TECHNICAL REPORT FOR THE
BEYONDIE POTASH PROJECT, AUSTRALIA, JORC (2012)
and NI 43-101 Technical Report – Bankable Feasibility
Study” and dated 17 September 2018 (Report), that
relates to Exploration Targets, Exploration Results,
Mineral Resources and Ore Reserves and is based on
information compiled by Thomas Schicht, a Competent
Person who is a Member of a ‘Recognised Professional
Organisation’ (RPO), the European Federation of
Geologists, and a registered “European Geologist”
(Registration Number 1077) and Anke Penndorf, a
Competent Person who is a Member of a RPO, the
European Federation of Geologists, and a registered
“European Geologist” (Registration Number 1152).
Kalium Lakes confirms that it is not aware of any
new information or data that materially affects the
information included in the original announcement
regarding the Report and, in the case of estimates
of Exploration Targets, Exploration Results, Mineral
Resources and Ore Reserves, which all material
assumptions and technical parameters underpinning
the estimates in the relevant announcement continue
to apply and have not materially changed. Kalium
Lakes confirms that the form and context in which
the Competent Persons’ findings are presented
have not been materially modified from the original
announcement regarding the Report.
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
KALIUM LAKES LIMITED I CONSOL-
21
21
21
IDATED ANNUAL REPORT
2018
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 CARNEGIE POTASH PROJECT
CARNEGIE POTASH PROJECT – JOINT VENTURE
The announcement included the following key points:
The Carnegie Joint Venture (CJV) is focussed on the
exploration and development of the Carnegie Potash
Project (CPP) in Western Australia, which is located
approximately 220 kilometres east-north-east of Wiluna.
The CJV comprises one granted exploration licence
(E38/2995) and five (5) exploration licence applications
(E38/2973, E38/2928, E38/3297, E38/5296 and E38/3295)
covering a total area of approximately 3,040 square
kilometres.
The CJV is a Joint Venture between Kalium Lakes (KLL,
70% Interest) and BCI Minerals (BCI, 30% interest).
Under the terms of the agreement BCI can earn up to a
50% interest in the CJV by predominantly sole-funding
exploration and development expenditure across
several stages. KLL is the manager of the CJV and will
leverage its existing Intellectual Property to fast track
work.
► Stage 1 Completed - BCI has earned a 30% interest
by sole funding the $1.5M Scoping Study Phase,
► Stage 2 - BCI can elect to earn a further 10% interest
by sole funding a further $3.5M Pre-Feasibility Study
Phase,
► Stage 3 - BCI can elect to earn a further 10% interest
by sole-funding a further $5.5M Feasibility Study
Phase,
► By end of the Feasibility Study the CJV would have an
ownership of 50% KLL and 50% BCI
This Project is prospective for hosting a large sub-
surface brine deposit which could be developed into
a solar evaporation and processing operation that
produces sulphate of potash (SOP). The Carnegie
Project tenements are located directly north of Salt
Lake Potash Limited’s (ASX:SO4) – Lake Wells tenements
and Australian Potash Limited’s (ASX:APC) – Lake Wells
tenements.
On 27 July 2018, Kalium Lakes and BCI Minerals
announced the results of the Scoping Study, Maiden
Resource and Exploration Target, confirming the CPP
has potential to be a technically and economically
viable project.
► Scoping Study leveraged the significant technical
knowledge, experience and intellectual property
developed by Kalium Lakes in advancing their
Beyondie Sulphate Of Potash Project.
► Inferred Resource of 0.88 Mt SOP @ 3,466 mg/l K
(equivalent to 7,729 mg/l SOP) based only on the
top 1.7 metres of the 27,874 hectare surficial aquifer
on granted tenement E38/2995 plus an Exploration
Target for material below the top 1.7 metres.
► Exploration Target of 3.46 Mt – 7.33 Mt SOP @ 3,410
mg/l K – 3,420 mg/l K within the deeper aquifers on
granted tenement E38/2995.
► A further 82,000 hectares of lake surface on pending
tenements is not included in the current Inferred
Resource or Exploration Target, providing further
resource upside potential.
► BCI Minerals earned a 30% CJV interest and Kalium
Lakes now holds a 70% interest.
► The JV Companies endorsed proceeding to a staged
Pre-Feasibility Study, with an initial focus on securing
tenure and access to all required tenements.
The Joint Venture Project will progress PFS activities
during the next 12-18 months. The initial focus will be
on securing tenure and access to all CPP tenements,
followed by various approvals to undertake site based
exploration activities, including drilling, trenching and
test pumping, with the aim of expanding the Resource
(including from conversion of the Exploration Target).
The key future PFS activities include:
► Native Title agreements and Section 18 heritage
approvals;
► Various stakeholder discussions, approvals and
permits to allow PFS field works to be undertaken
including, Programme of Work approvals, Native
Vegetation Clearing Permits, 26D licences and 5C
water bore approvals;
► Secure the grant of the exploration tenement
applications, to facilitate a PFS on the full extent of
the Carnegie lake system;
► Drilling, trenching and test pumping to expand the
current Resource;
► Pond, purification plant and infrastructure design;
and
► Completion of the PFS.
22
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 ► Carnegie JV Project Regional Overview Map
23
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 CARNEGIE POTASH PROJECT
Carnegie Potash Project – Tenement Interests
Tenement Tenement Name
Holder
State
Status
Grant Date
Interest
E38/2995
Carnegie East
KLP
E38/2973
Carnegie Central
Rachlan
E38/2982
Carnegie West
Rachlan
E38/3295
Carnegie South West
KLP
E38/3296
Carnegie South East
KLP
E38/3297
Carnegie North
KLP
WA
WA
WA
WA
WA
WA
Granted
31-7-2015
Application
Application
Application
Application
Application
-
-
-
-
-
70%*
70%*
70%*
70%*
70%*
70%*
* Interest decreased from 85% to 70% on 27 July 2018 (i.e. subsequent to end of the financial year).
Note: Kalium Lakes Potash Pty Ltd (KLP) entered into a declaration of trust with Rachlan Holdings Pty Ltd (Rachlan) where Rachlan will hold
for the benefit of KLP certain exploration licence applications and deal with the applications as directed by KLP (including transferring title).
24
24
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 Carnegie Potash Project - Mineral Resources Summary
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25
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
CARNEGIE POTASH PROJECT
Forward-Looking Information
Certain information in this document refers to the
intentions of Kalium Lakes and BCI Minerals , but
these are not intended to be forecasts, forward looking
statements or statements about the future matters
for the purposes of the Corporations Act or any other
applicable law. The occurrence of the events in the
future are subject to risk, uncertainties and other
actions that may cause Kalium Lakes’ and/or BCI
Minerals actual results, performance or achievements
to differ from those referred to in this document.
Accordingly Kalium Lakes, BCI Minerals and their
affiliates and their directors, officers, employees and
agents do not give any assurance or guarantee that the
occurrence of these events referred to in the document
will actually occur as contemplated.
Statements contained in this document, including but
not limited to those regarding the possible or assumed
future costs, performance, dividends, returns, revenue,
exchange rates, potential growth of Kalium Lakes and
BCI Minerals, industry growth or other projections and
any estimated company earnings are or may be forward
looking statements. Forward-looking statements can
generally be identified by the use of words such as
‘project’, ‘foresee’, ‘plan’, ‘expect’, ‘aim’, ‘intend’, ‘anticipate’,
‘believe’, ‘estimate’, ‘may’, ‘should’, ‘will’ or similar
expressions. These statements relate to future events and
expectations and as such involve known and unknown
risks and significant uncertainties, many of which are
outside the control of Kalium Lakes and BCI Minerals .
Actual results, performance, actions and developments
of Kalium Lakes and BCI Minerals may differ materially
from those expressed or implied by the forward-looking
statements in this document. Such forward-looking
statements speak only as of the date of this document.
There can be no assurance that actual outcomes will not
differ materially from these statements.
To the maximum extent permitted by law, Kalium
Lakes, BCI Minerals and any of their affiliates and their
directors, officers, employees, agents, associates and
advisers:
► disclaim any obligations or undertaking to release
any updates or revisions to the information to reflect
any change in expectations or assumption;
► do not make any representation or warranty,
express or implied, as to the accuracy, reliability or
completeness of the information in this document,
or likelihood of fulfilment of any forward-looking
statement or any event or results expressed or
implied in any forward-looking statement; and
26
► disclaim all responsibility and liability for these
forward-looking statements (including, without
limitation, liability for negligence.
Compliance Statement
The information in this document is extracted from the
report titled “CARNEGIE POTASH PROJECT, AUSTRALIA,
JORC (2012) and NI 43-101 TECHNICAL REPORT” and
dated 30 June 2018 (Report), that relates to Exploration
Targets, Exploration Results, Mineral Resources and
Mineral Reserves and is based on information compiled
by Thomas Schicht, a Competent Person who is a
Member of a ‘Recognised Professional Organisation’
(RPO), the European Federation of Geologists, and
a registered “European Geologist” (Registration
Number 1077) and Anke Penndorf, a Competent
Person who is a Member of a RPO, the European
Federation of Geologists, and a registered “European
Geologist” (Registration Number 1152). Kalium Lakes
and BCI Minerals confirm they are not aware of any
new information or data that materially affects the
information included in the original announcement
regarding the Report and, in the case of estimates of
Mineral Resources, which all material assumptions
and technical parameters underpinning the estimates
in the relevant announcement continue to apply and
have not materially changed. Kalium Lakes and BCI
Minerals confirm that the form and context in which
the Competent Persons’ findings are presented
have not been materially modified from the original
announcement regarding the Report.
Thomas Schicht and Anke Penndorf are full-term
employees of K-UTEC AG Salt Technologies (K-UTEC).
K-UTEC, Thomas Schicht and Anke Penndorf are not
associates or affiliates of Kalium Lakes, BCI Minerals
or any of their affiliates. K-UTEC will receive a fee for
the preparation of the Report in accordance with
normal professional consulting practices. This fee is
not contingent on the conclusions of the Report and
K-UTEC, Thomas Schicht and Anke Penndorf will receive
no other benefit for the preparation of the Report.
Thomas Schicht and Anke Penndorf do not have any
pecuniary or other interests that could reasonably be
regarded as capable of affecting their ability to provide
an unbiased opinion in relation to Kalium Lakes, BCI
Minerals and Carnegie Potash Project.
K-UTEC does not have, at the date of the Report, and
has not had within the previous years, any shareholding
in or other relationship with Kalium Lakes, BCI Minerals
or the Carnegie Potash Project and consequently
considers itself to be independent of Kalium Lakes and
BCI Minerals.
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 POTASH PROSPECTS – DORA AND BLANCHE
Thomas Schicht and Anke Penndorf have sufficient
experience that is relevant to the style of mineralisation
and type of deposit under consideration and to the
activity being undertaken to qualify as a Competent
Person as defined in the 2012 Edition of the JORC
‘Australasian Code for Reporting of Exploration Results,
Mineral Resources and Ore Reserves’. Thomas Schicht
and Anke Penndorf consent to the inclusion in the
Report of the matters based on their information in the
form and context in which it appears.
POTASH PROSPECTS – DORA AND BLANCHE
The Company has applied for exploration licences that
could, if granted, introduce a new prospective area, the
Dora/Blanche Prospect, for potassium exploration.
POTASH PROSPECTS
Tenement
Tenement
Name
Holder
State
Status
Grant Date
Interest
E45/4436
Dora
Rachlan
E45/4437
Blanche
Rachlan
WA
WA
Application
Application
-
-
100%
100%
Note: Kalium Lakes Potash Pty Ltd (KLP) entered into a declaration of trust with Rachlan Holdings Pty Ltd (Rachlan) where Rachlan will hold
for the benefit of KLP certain exploration licence applications and deal with the applications as directed by KLP (including transferring title).
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
27
27
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 COMPANY SUMMARY (CONTINUED)
Safety
ENVIRONMENT
Kalium Lakes places the health and safety of its
employees and contractors above all other business
considerations. Health and safety performance is
integral to an efficient and successful company. KLL
strives to create a culture where safety is a core value
and every individual takes responsibility for their
own actions and will act to stop the unsafe actions of
others.
In support of this culture, management accepts the
responsibility for the creation of a safe workplace,
through the implementation of a Health and Safety
Management System and the promotion of safety
awareness among their employees and contractors.
Kalium Lakes will abide by all legal and other
requirements that are directly related to Health and
Safety activities.
During the financial year to 30 June 2018 a total of
33,634 hours were worked at the Beyondie SOP Project
site with no Lost Time Injuries and two(2) Medical
Treatment Injuries.
Kalium Lakes Limited is committed to responsible
environmental management and environmental
performance as an essential attribute of an efficient
and successful company. This will be achieved through
leadership and the use of reliable systems that provide
timely and accurate information, in a transparent
manner to support effective decision making.
COMMUNITY
Kalium Lakes strives to engage and work with those
local communities near to where it operates. In doing
so, it will continually work to build trust and respect, as
well as ensuring that key stakeholders are informed in
a timely, open and transparent manner.
The Company will maintain a clear and concise
approach to consultation and negotiations with
landholders, adhere to acceptable protocols that are
endorsed by local community representatives and
establish mutually beneficial long term relationships,
employment and contracting opportunities as part of a
culturally aware workplace.
Sustainability
Corporate
NATIVE TITLE AND HERITAGE
Kalium Lakes recognises the importance of country, law
and culture of the Traditional Owners. It is committed
to the effective management of indigenous and
community matters which form an integral part of its
successful operations. KLL also expects its managers
to be educated and active in fostering long-term
relationships with both Indigenous People and the
Community.
The Traditional Owners’ belief that the health and
vitality of people (martu), country (ngurra) and law
and culture (tjukurrpa) are connected, is formally
acknowledged by Kalium Lakes.
The Company recognises that culturally significant sites
and issues may from time to time be identified on its
leases. Its management, employees, contractors and
associates undertake to comply with the requirements
of the Aboriginal Heritage Act 1972 in recognising these
sites.
BOARD AND MANAGEMENT
The Directors were appointed on 14 July 2016, coinciding
with the incorporation of Kalium Lakes Limited.
At the Annual General Meeting held on 10 November
2017, Mr Brendan O’Hara, in accordance with the
Company’s Constitution retired and being eligible, was
re-elected as a Director.
On 13 November 2017 Mr Frederick Kotzee, was
appointed Chief Financial Officer (CFO) and then
stepped down from the role on 17 May 2018. Mr
Christopher Achurch transitioned into the Company as
CFO from that time.
BUSINESS DEVELOPMENT
The Company plans to continue to actively assess
business development opportunities that relate to its
existing project portfolio.
As and when acquisitions, divestments or partnerships
are completed the Company will make announcements
to the market under continuous disclosure
requirements.
28
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 FINANCIAL POSITION
The Company had $7.7 million cash on hand as
at 30 June 2018.
SHARES ON ISSUE
As at 30 June 2018 the Company had 169,793,465
Ordinary Shares on Issue.
As at 30 June 2018 the Company had issued the
following Options:
► 330,882 Options exercisable at $0.425 each, expiring
on 29 September 2020;
► 843,936 Options exercisable at $0.525 each, expiring
on 19 January 2020; and
► 1,000,000 Options exercisable at $0.525 each,
expiring on 17 May 2021.
The following is a list detailing the ASX Restricted
Securities:
► 57,769,847 fully paid ordinary shares, escrowed for
a period of 24 months from the date of official
quotation on the ASX;
► 9,000,000 options exercisable at $0.25 each, expiring
on 16 December 2019 and escrowed for a period of
24 months from the date of official quotation on the
ASX; and
► 20,000,000 performance rights, expiring 16 December
2021 and escrowed for a period of 24 months from
the date of official quotation.
DIVIDENDS
The extent, timing and payment of any dividends in the
future will be determined by the Directors based on a
number of factors, including future earnings and the
financial performance and position of the Company.
ASX CORPORATE GOVERNANCE COUNCIL’S CORPORATE
GOVERNANCE PRINCIPLES AND RECOMMENDATIONS
The Company has adopted comprehensive systems
of control and accountability as the basis for the
administration of corporate governance. The Board
is committed to administering the Company’s policies
and procedures with openness and integrity, pursuing
the true spirit of corporate governance commensurate
with the Company’s needs.
To the extent applicable, the Company has adopted
the ASX Corporate Governance Council’s Corporate
Governance Principles and Recommendations
(Recommendations).
The Board considers that, due to the Company’s
size and nature, the current Board composition and
structure is a cost effective and practical method
of directing and managing the Company. As the
Company’s activities develop in size, nature and
scope, the size of the Board and the implementation
of additional corporate governance policies and
structures will be reviewed.
The Company’s Corporate Governance Statement is
available on the Company’s website at
www.kaliumlakes.com.au
29
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 KEY RISKS
Key Risks
FINANCING
The Shares are considered highly speculative. An
investment in the Company is not risk free. The
proposed future activities of the Company are subject
to a number of risks and other factors which may
impact its future performance. Some of these risks can
be mitigated by the use of safeguards and appropriate
controls. However, many of the risks are outside
the control of the Directors and management of the
Company and cannot be mitigated.
DEVELOPMENT OF THE BEYONDIE SOP PROJECT
The Company has prepared estimates of future
production targets, revenue profiles, operating cash
costs and capital costs for its operations. No assurance
can be given that such estimates will be achieved or
that the Company will have access to sufficient capital
to develop the Beyondie SOP Project.
Production targets and operating costs may be affected
by a variety of factors, including the acquisition
and/or delineation of economically recoverable
mineralisation, favourable geological conditions,
receiving the necessary approvals from all relevant
authorities and parties, seasonal weather patterns,
unanticipated technical and operational difficulties
encountered in extraction and production activities,
mechanical failure of operating plant and equipment,
shortages or increases in the price of consumables,
spare parts and plant and equipment, cost overruns,
access to the required level of funding and contracting
risk from third parties providing essential services.
Other risks impacting production and operating cost
estimates include increases in labour costs, general
inflationary pressures, currency exchange rates and
other unforeseen circumstances such as health and
safety outcomes.
The success of the Company will also depend upon
the Company having access to sufficient capital, being
able to maintain permits and obtaining all required
approvals for its activities.
Failure to achieve production or cost estimates or
material increases in costs could have an adverse
impact on the Company’s future cash flows, profitability,
results of operations and financial condition.
The Company will require significant financing for
capital expenditure to develop the Beyondie Potash
Project and to fund its operating costs. The Company
will require financing from external sources to meet
such requirements. There can be no assurance that
such financing, whether equity or debt, will be available
to the Company, and if it is, whether the terms of
such equity or debt financing will be commercially
acceptable. The ability of the Company to arrange
financing will depend, in part, on prevailing market
conditions as well as the business performance of the
Company.
If the Company obtains additional financing through
the issuance of equity or convertible securities,
the interests of shareholders in the Company may
be diluted. Additional debt financing may involve
restrictions on the Company’s future financing and
operating activities. Any failure of the Company to
obtain required financing on acceptable terms could
have a material adverse effect on the Company’s
financial condition, results of operations and its
liquidity and may require the Company to postpone,
reduce or terminate the development.
ENVIRONMENTAL AND OTHER STATUTORY APPROVALS
The Company’s project and operations are subject
to Commonwealth and State laws, regulations and
specific conditions regarding approvals to explore,
construct and operate. There is a risk that such laws,
regulations and specific conditions may impact the
profitability of the project and the ability for the project
to be satisfactorily permitted. Key approvals from the
Environmental Protection Authority (EPA), Department
of Mines, Industry Regulation and Safety (DMIRS),
Department of Water and Environmental Regulation’s
(DWER) plus many other agencies may take longer to be
obtained or may not be obtainable at all. The Company
has identified that the process will have disturbances
associated with ponds, purification facility, pipelines,
bores, trenches, roads, waste NaCl, residue bitterns
which may be subject to specific disposal conditions.
30
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 OFFTAKE
PROJECT DELAYS AND COST OVERRUNS
The Company’s ability to successfully develop and
potentially commercialise its Beyondie Potash Project
on schedule may be affected by factors including
project delays and costs overruns.
If the Company experiences project delays or cost
overruns, this could result in the Company not realising
its operational or development plans or result in such
plans costing more than expected or taking longer to
realise than expected.
INABILITY TO ABSTRACT BRINE VOLUME
The Company has utilised a number of specialist
consultants in determining its ability to abstract brine
consistently from the deposits but there is a risk that
the Company will be unable to abstract the brine in
volumes required to meet project timetables and
production. This can occur due to low permeability
of aquifer material, variability in the deposit and
continuity of the various aquifer layers. As a result
pumping rates may be lower than expected, or
require additional bores and/or trenches. Each bore
and trench is likely to have a specific life expectancy
and will eventually run dry as brine is extracted. This
life expectancy maybe be variable and shorter than
expected.
VARIABILITY IN BRINE
The brine deposit may be variable due to the geological
layering of the host rock, the location within the
palaeochannel, inflows of other waters carrying other
impurities or fresh water all of which will affect the
brine chemistry across the deposit. Added to this there
is also the potential for dilution after rainfall which may
influence changes in the chemistry of brine recovery.
The variability may cause different evaporation
rates, alternative salt evaporites being formed in
the evaporation ponds, require additional pumping
volumes due to lower grades.
To date, the Company has entered into a
non-binding terms sheet with German fertiliser
producer and distributor K+S. The Company may
experience delays in converting, or may be unable to
negotiate a binding offtake agreement on acceptable
terms. The Company may have difficulty in finding
additional offtake partners who are prepared to enter
into long-term offtake agreements. If the Company
is unable to negotiate long-term offtake agreements,
then the expansion of the project may be delayed or
prevented. Assuming the Company is able to secure
sales or offtake agreements in the future, it may
depend upon its customers, the loss of any of which or
the inability to collect payment from could adversely
affect the results of the Company’s financial condition.
RESOURCE AND RESERVE ESTIMATES AND
CLASSIFICATION
The Mineral Resource and Ore Reserve estimates for
the Beyondie Potash Project are estimates only and
are expressions of judgement based on knowledge,
experience and industry practice. In addition, by
their very nature, Mineral Resource estimates are
necessarily imprecise and depend to some extent on
interpretations, which may prove to be inaccurate. No
assurances can be given that any particular level of
recovery of potash will in fact be realised.
PURIFICATION FACILITY DESIGN, OPERATION,
RECOVERY AND PRODUCT SPECIFICATION
The Company is using internationally recognised
consultants in the design of the process and selection
of suitable equipment to achieve production capacity
and specification to market requirements. However,
project development remains inherently risky due to
the number of variables that need to be managed. This
could lead to equipment not performing as required
or expected, resulting in difficulty maintaining product
specification, not achieving name plate design capacity,
not achieving expected potassium recoveries, increased
maintenance and overall operating costs.
This risk also applies to non-process plant equipment
and facilities, recognising that the Beyondie Potash
Project by its nature is operating with corrosive fluids
and subject to environmental impacts of salinity which
may result in premature or otherwise unexpected
failure of critical equipment such as bore pumps.
31
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 KEY RISKS
EVAPORATION POND DESIGN
The Company will need to confirm the construction
methodology, evaporation rates, leakage rates and
other potential performance parameters of the brine.
There is a scale up risk that, in the construction and
operation of the evaporation ponds, these performance
parameters could vary to the current pond and pump
testing findings and therefore may impact the basis of
design and operation, and potentially the capital and
operation costs, of the full size project. There is also a
risk of structural failures or leakage.
COMMODITY PRICE VOLATILITY
If the Company achieves success leading to mineral
production, the revenue the Company will derive
through the sale of commodities exposes the Company
to commodity price and exchange rate risk. Commodity
prices fluctuate and are affected by numerous factors
beyond the control of the Company. Such factors
include the supply and demand for commodities such
as potash, forward selling activities, technological
advancements and other macro-economic factors.
CURRENCY VOLATILITY
International prices of various commodities are
denominated in United States dollars, whereas the
income and expenditure of the Company are and will
be taken in account in Australian Dollars, consequently
exposing the Company to the fluctuations and volatility
of the rate of exchange between the United States
Dollar and the Australian Dollar as determined in
international markets.
DEPENDENCE ON KEY PERSONNEL
The responsibility of overseeing the day-to-day
operations and the strategic management of the
Company depends substantially on the efforts of senior
management and its key personnel. There can be no
assurance that there will be no detrimental impact on
the Company if one or more of these employees cease
their employment. The loss of key personnel could
cause a significant disruption to the business and could
adversely affect our operations.
NEW OPERATIONAL COMMODITY AND LACK OF
EXPERIENCE
The Company recognises that as a potential leader in
the Australian production of potash products there may
initially be a lack of suitably trained operators for the
overall project which has been explicitly designed for
the extraction and treatment of brine to produce this
group of products to market specifications.
Furthermore, this risk could manifest itself during the
commissioning stage for the same reasons expressed
above which could lead to increased capital costs and
delays in achieving operational ramp up.
INCLEMENT WEATHER AND NATURAL DISASTERS
The Company’s operational activities are subject to
a variety of risks and hazards which are beyond its
control, including hazardous weather conditions such
as excessive rain, flooding and fires.
Severe storms and high rainfall leading to flooding
and associated damage may result in disruption to the
evaporation process in the ponds, scouring damage to
trenches, roadways and pond walls. Flood waters within
the pond areas will increase the total evaporation time
and impact the production schedule.
Additionally, as some of the brine production is from
surface trenches, these trenches may become flooded
during severe weather. This may impact the quality and
consistency of the brine and the ability to continue
surface extraction by trenches within the lakes areas,
until the flood waters subside. Any of the above
occurrences will impact profitability.
TITLE RISK
The Company’s granted tenements permit the Company
to undertake exploration. Each tenement carries with
it annual expenditure and reporting commitments,
as well as other conditions requiring compliance.
Consequently, the Company could lose title to or its
interest in a tenement if the conditions are not met
or if there are insufficient funds available to meet
expenditure commitments.
Exploration tenements are subject to periodic renewal.
The renewal of the term of a granted tenement is
also subject to the discretion of the relevant Minister.
Various conditions may also be imposed as a condition
of renewal. Renewal conditions may include increased
expenditure and work commitments or compulsory
relinquishment of the tenements comprising the
Company’s projects. The Company makes no assurance
that the renewal applications will be granted or
applications approved.
32
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 EXPLOITATION, EXPLORATION AND MINING LICENCES
INSURANCE
The tenements that have been granted only permit the
Company to undertake exploration on the tenements.
In the event that the Company successfully delineates
economic deposits on any of the tenements, it
will need to apply for a mining lease to undertake
development and mining on the tenement. There is no
guarantee that the Company will be granted a mining
lease if one is applied for.
Potential investors should understand that mineral
exploration is a high-risk undertaking. There can be
no assurance that exploration of the Beyondie Potash
Project exploration tenements, or any other tenements
that may be acquired in the future, will result in the
discovery of an economic deposit. Even if an apparently
viable deposit is identified, there is no guarantee that it
can be economically exploited.
CHANGE IN REGULATIONS
Adverse changes in Federal or Western Australia
government policies or legislation may affect
ownership of mineral interests, taxation, royalties, land
access, labour relations and mining and exploration
activities of the Company. It is possible that the current
system of exploration and mine permitting in Western
Australia may change resulting in impairment of rights
and possibly expropriation of the Company’s properties
without adequate compensation. Increased royalties
or any other changes to the royalty regime could result
in higher operating costs for the Company’s operations
and may have an adverse effect on the Company’s
business, results, financial condition and prospects.
The Company intends to insure its operations in
accordance with industry practice. However, in certain
circumstances, the Company’s insurance may not be
available or of a nature or level to provide adequate
insurance cover. The occurrence of an event that is
not covered or fully covered by insurance could have
a material adverse effect on the business, financial
condition and results of the Company. In addition, there
is a risk that an insurer defaults in the payment of a
legitimate claim by the Company.
CONTRACTUAL DISPUTES
As with any contract, there is a risk that the business
could be disrupted in situations where there is a
disagreement or dispute in relation to a term of the
contract. Should such a disagreement or dispute occur,
this may have an adverse impact on the Company’s
operations and performance generally. It is not possible
for the Company to predict or protect itself against all
such risks.
THIRD PARTY RISK
The operations of the Company require the involvement
of a number of third parties, including suppliers,
contractors and clients.
Financial failure, default or contractual non-compliance
on the part of such third parties may have a material
impact on the Company’s operations and performance.
It is not possible for the Company to predict or protect
the Company against all such risks.
ENVIRONMENTAL RISK
COMPETITION
The operations and proposed activities of the
Company are subject to State and Federal laws and
regulations concerning the environment. As with most
exploration projects, the Company’s activities including
the Beyondie Potash Project are expected to have
an impact on the environment. It is the Company’s
intention to conduct its activities to the required
standard of environmental obligation, including
compliance with all environmental laws.
Although the Company believes that it is in
compliance in all material respects with all applicable
environmental laws and regulations, there are certain
risks inherent to its activities, such as accidents or
other unforeseen circumstances, which could subject
the Company to extensive liability.
Although there is currently no Australian production
of SOP, there are other mining exploration companies
in Australia that are currently seeking to explore,
develop and produce SOP. The Company will have
no influence or control over the activities or actions
of its competitors and other industry participants,
whose activities or actions may positively or negatively
affect the operating and financial performance of
the Company’s projects and business. Competitors
may have significant additional experience and / or
resources to explore, develop and product competing
products, which may adversely affect the Company’s
financial position or prospects.
33
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 DIRECTORS’ REPORT
DIRECTORS’ REPORT
Your Directors submit the financial report of the Consolidated Entity for the year ended 30 June
2018.
DIRECTORS
The names of Directors who held office during or since the end of the year:
Malcolm Randall
Brett Hazelden
Rudolph van Niekerk
Brendan O’Hara
Non-Executive Chairman
Managing Director
Executive Director
Non-Executive Director
DIRECTORS’ QUALIFICATIONS AND EXPERIENCE
The Directors’ qualifications and experience are set out below:
Malcolm Randall
Non-Executive Chairman
Malcolm Randall
NON-EXECUTIVE CHAIRMAN
Malcolm Randall (Dip Applied Chem, FAICD) holds a Bachelor of Applied Chemistry Degree and
has more than 45 years’ of experience in corporate, management and marketing in the resources
sector, including more than 25 years with the Rio Tinto group of companies.
Malcolm Randall (Dip Applied Chem, FAICD) holds a Bachelor of Applied Chemistry Degree
and has more than 45 years’ of experience in corporate, management and marketing in the
resources sector, including more than 25 years with the Rio Tinto group of companies.
His experience has covered a diverse range of commodities including iron ore, base metals,
uranium, mineral sands and coal.
His experience has covered a diverse range of commodities including iron ore, base metals,
uranium, mineral sands and coal.
Malcolm Randall has held the position of chairman and director of a number of ASX listed
companies. Past directorships include Consolidated Minerals Limited, Titan Resources Limited,
Northern Mining Limited, Iron Ore Holdings Limited and United Minerals Corporation NL. Current
directorships include Thundelarra Limited, Summit Resources Limited, Magnetite Mines Limited
and Argosy Minerals Limited.
Malcolm Randall has held the position of chairman and director of a number of ASX listed
companies. Past directorships include Consolidated Minerals Limited, Titan Resources
Limited, Northern Mining Limited, Iron Ore Holdings Limited and United Minerals
Corporation NL. Current directorships include Thundelarra Limited, Summit Resources
Limited, Magnetite Mines Limited and Argosy Minerals Limited.
Brett Hazelden
Managing Director
Brett Hazelden
MANAGING DIRECTOR
Brett Hazelden (B.Sc. MBA GAICD) is a Metallurgist who brings more than 20 years’ experience in
project management, engineering design and operations servicing the Australasian resources
industry. His previous responsibilities include project management, feasibility study evaluation,
engineering and design, estimating, financial evaluation, cost control, scheduling, contracts and
procurement, business risk and strategic development.
Brett Hazelden (B.Sc. MBA GAICD) is a Metallurgist who brings more than 20 years’
experience in project management, engineering design and operations servicing the
Australasian resources industry. His previous responsibilities include project management,
feasibility study evaluation, engineering and design, estimating, financial evaluation, cost
control, scheduling, contracts and procurement, business risk and strategic development.
Brett Hazelden has studied, managed and executed projects from small scale works up to multi-
billion dollar complex developments. He has been responsible for environmental permitting and
approvals, heritage, native title negotiations, external relations, as well as tenure management.
Brett has also been involved in numerous mergers, acquisitions and due diligence reviews in
recent years.
Brett Hazelden has studied, managed and executed projects from small scale works up
to multibillion dollar complex developments. He has been responsible for environmental
permitting and approvals, heritage, native title negotiations, external relations, as well as
tenure management. Brett has also been involved in numerous mergers, acquisitions and
due diligence reviews in recent years.
Kalium Lakes Limited and Consolidated Entities
2
34
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
Rudolph van Niekerk
EXECUTIVE DIRECTOR
Rudolph van Niekerk (B.Eng. Mechanical GAICD) is a professional in the mining and resources
industry with more than 14 years’ experience in project and business management.
During his career Rudolph van Niekerk has held a range of different roles in the
management of projects and operations. His various responsibilities have included financial
evaluation, risk review and management, project management, development of capital
and operating cost estimates, budget development and cost control, design management,
planning, reporting, contract administration, quality control, expediting, construction,
commissioning, production ramp-up and project hand-over to operations.
Brendan O’Hara
NON-EXECUTIVE DIRECTOR
Brendan O’Hara (BJuris, LLB) holds a Bachelor of Jurisprudence (Hons) and Bachelor of Laws.
He is a former Senior Fellow of FINSIA, a former legal practitioner of the Supreme Court of
WA and former member of the Business Law Section of the Law Council of Australia.
Brendan O’Hara has many years’ experience as a director of Australian listed companies, including
eight years as Executive Chairman of an ASX listed company (Summit Resources Limited).
His earlier roles with the ASX (as State Director and Manager – Listings), underpin a wealth
of experience involving international transactions, corporate governance, risk management
systems, contract negotiation / execution and government relations.
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
35
35
35
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
DIRECTORS’ REPORT (CONTINUED)
DIRECTORS’ REPORT continued
DIRECTORS’ REPORT continued
MEETINGS OF DIRECTORS
MEETINGS OF DIRECTORS
The number of meetings for Kalium Lakes Limited held during the year and the number of
The number of meetings for Kalium Lakes Limited held during the year and the number of
meetings attended by each Director was as follows:
meetings attended by each Director was as follows:
Number of Meetings Held
Number of Meetings Held
Number of Meetings Held
Number of Meetings Attended:
Number of Meetings Attended:
Number of Meetings Attended:
Malcolm Randall
Malcolm Randall
Malcolm Randall
Brett Hazelden
Brett Hazelden
Brett Hazelden
Rudolph van Niekerk
Rudolph van Niekerk
Rudolph van Niekerk
Brendan O’Hara
Brendan O’Hara
Brendan O’Hara
Board
Board
Board
9
9
9
9
9
9
9
9
9
9
9
9
9
9
9
Audit
Audit
Audit
Committee
Committee
Committee
3
3
3
Remuneration
Remuneration
Remuneration
Committee
Committee
Committee
3
3
3
Nomination
Nomination
Nomination
Committee
Committee
Committee
2
2
2
3
3
3
3
3
3
3
3
3
3
3
3
3
3
3
3
3
3
3
3
3
3
3
3
2
2
2
2
2
2
2
2
2
2
2
2
All Directors were eligible to attend all Board Meetings held.
All Directors were eligible to attend all Board Meetings held.
SHARE OPTIONS
SHARE OPTIONS
As at the date of this report the following unlisted options were on issue:
As at the date of this report the following unlisted options were on issue:
Listed
Unlisted
Number of Ordinary Shares
Number of Options
-
-
-
-
Directly
Directly
Indirectly
Indirectly Directly
479,184
13,669,066
- 4,000,000
-
-
Malcolm
-
-
Randall
Brett Hazelden
-
-
Rudolph van
Niekerk
-
-
Brendan O’Hara
Indirectly
9,000,000 unlisted options for ordinary shares at an exercise price of $0.25 each (expiring
9,000,000 unlisted options for ordinary shares at an exercise price of $0.25 each (expiring
-
16 December 2019) and escrowed until 21 December 2018)
16 December 2019) and escrowed until 21 December 2018)
-
330,882 unlisted options for ordinary shares at an exercise price of $0.425 each (expiring
330,882 unlisted options for ordinary shares at an exercise price of $0.425 each (expiring
29 September 2020)
29 September 2020)
-
843,936 unlisted options for ordinary shares at an exercise price of $0.525 each (expiring
843,936 unlisted options for ordinary shares at an exercise price of $0.525 each (expiring
-
19 January 2020)
19 January 2020)
Nomination
1,000,000 unlisted options for ordinary shares at an exercise price of $0.525 (expiring 17
1,000,000 unlisted options for ordinary shares at an exercise price of $0.525 (expiring 17
Committee
May 2021)
May 2021)
2
Number of Meetings Held
Number of Meetings Attended:
SHARES ISSUED AS A RESULT OF THE EXERCISE OF OPTIONS
SHARES ISSUED AS A RESULT OF THE EXERCISE OF OPTIONS
Malcolm Randall
9
Brett Hazelden
9
No shares as a result of the exercise of the options were issued as at the date of this report.
No shares as a result of the exercise of the options were issued as at the date of this report.
9
Rudolph van Niekerk
9
Brendan O’Hara
DIRECTORS’ INTERESTS AND BENEFITS
DIRECTORS’ INTERESTS AND BENEFITS
-
-
Audit
Committee
3
Remuneration
Committee
3
-
-
- 2,000,000
3,315,600
-
3
3
3
3
3
3
3
3
2
2
2
2
Board
-
-
9
-
-
The relevant interest of each Director in the shares and options over shares issued by the
The relevant interest of each Director in the shares and options over shares issued by the
Company at the date of this report is as follows:
Company at the date of this report is as follows:
Number of Ordinary Shares
Number of Ordinary Shares
Number of Ordinary Shares
Number of Options
Number of Options
Number of Options
Malcolm
Malcolm Randall
Malcolm Randall
Randall
Brett Hazelden
Brett Hazelden
Brett Hazelden
Rudolph van
Rudolph van
Rudolph van
Niekerk
Niekerk
Niekerk
Brendan O’Hara
Brendan O’Hara
Brendan O’Hara
Directly
Directly
Directly
-
-
-
-
-
-
Indirectly Directly
Indirectly Directly
Indirectly Directly
-
-
-
-
-
-
479,184
479,184
479,184
13,669,066
13,669,066
13,669,066
Listed
Listed
Listed
Indirectly
Indirectly
Indirectly
Unlisted
Unlisted
Unlisted
Directly
Directly
Directly
- 4,000,000
- 4,000,000
- 4,000,000
-
-
-
-
-
-
Indirectly
Indirectly
Indirectly
-
-
-
-
-
-
-
-
-
-
-
-
3,315,600
3,315,600
3,315,600
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
- 2,000,000
- 2,000,000
- 2,000,000
-
-
-
-
-
-
Kalium Lakes Limited and Consolidated Entities
Kalium Lakes Limited and Consolidated Entities
4
4
36
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
DIRECTORS’ REPORT continued
REMUNERATION REPORT
Introduction
The Directors present the Remuneration Report for the Consolidated Entity for the year ended 30
June 2018. This Remuneration Report forms part of the Directors’ Report in accordance with the
requirements of the Corporations Act 2001 and its regulations. For the purposes of this report,
Key Management Personnel (“KMP”) of the Consolidated Entity are defined as those persons
having authority and responsibility for planning, directing and controlling the major activities of
the Company and the Consolidated Entity, directly or indirectly, including any director (whether
executive or otherwise) of the Parent Entity.
Remuneration Policy
The remuneration policy has been designed to align KMP objectives with Shareholders’ interests
and business objectives by providing a fixed remuneration component and offering specific long-
term incentives based on key performance areas affecting the Consolidated Entity’s financial
results. The Board believes that the remuneration policy is appropriate and effective in its ability
to attract and retain the best KMP to run and manage the Consolidated Entity, as well as create
goal congruence between Directors, Executives and Shareholders.
Executive Directors and Key Management Personnel
The Board’s policy for determining the nature and amount of remuneration for Executive
Directors and KMP of the Consolidated Entity was in place for the financial year ended 30 June
2018.
Non-Executive Directors
The Board’s policy is to remunerate Non-Executive Directors based on market practices, duties
and accountability. Independent external advice is sought when required. The fees paid to Non-
Executive Directors are reviewed annually. The maximum aggregate amount of fees that can be
paid to Non-Executive Directors is subject to approval by Shareholders at the Annual General
Meeting (“AGM”). The maximum aggregate amount of fees payable is currently $250,000.
Use of Remuneration Consultants
To ensure the Remuneration Committee is fully informed when making remuneration decisions,
it may seek external remuneration advice. The Board did seek external remuneration advice in
2018.
Remuneration Report Approval at FY2018 AGM
The remuneration report for the year ended 30 June 2018 will be put to shareholders for approval
at the Company’s AGM.
Kalium Lakes Limited and Consolidated Entities
5
37
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 DIRECTORS’ REPORT (CONTINUED)
DIRECTORS’ REPORT continued
Share Trading and Margin Loans by Directors and Executives
Directors, executives and employees are prohibited from:
a. Short term trading: trading in securities (or an interest in securities) on a short-term
trading basis other than when a director, employee or executive exercises employee
options or performance rights to acquire shares at the specified exercise price. Short-term
trading includes buying and selling securities within a 3-month period, and entering into
other short-term dealings (e.g. forward contracts).
b. Hedging unvested awards: trading in securities which operate to limit the economic risk
of an employee’s holdings of unvested securities granted under an employee incentive
plan; or
Short positions: trading in securities which enable an employee to profit from or limit the
economic risk of a decrease in the market price of shares.
c.
KMP may not include their securities in a margin loan portfolio or otherwise trade in securities
pursuant to a margin lending arrangement without first obtaining the consent of the Chairman.
Such dealing would include:
a. Entering into a margin lending arrangement in respect of securities;
b. Transferring securities into an existing margin loan account; and
c.
Selling securities to satisfy a call pursuant to a margin loan except where they have no
control over such sale.
The Company may, at its discretion, make any consent granted in accordance with the above
paragraph conditional upon such terms and conditions as the Company sees fit (for example, in
regards to the circumstances in which the securities may be sold to satisfy a margin call).
Kalium Lakes Limited and Consolidated Entities
6
38
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 DIRECTORS’ REPORT continued
DIRECTORS’ REPORT continued
A. Details of Remuneration
A. Details of Remuneration
Table 1: Details of remuneration of the Directors and KMP of the Consolidated Entity (as defined
Table 1: Details of remuneration of the Directors and KMP of the Consolidated Entity (as defined
by AASB 124 Related Party Disclosures) and specified executives are set out below:
by AASB 124 Related Party Disclosures) and specified executives are set out below:
Short-term
Short-term
Short-term
benefits
benefits
benefits
Post-
Post-
Post-
employment
employment
employment
benefits
benefits
benefits
Share-based payments
Share-based payments
Share-based payments
Cash salary, fees
Cash salary, fees
and other
Cash salary, fees
and other
benefits
and other
benefits
$
benefits
$
$
Super-
Super-
annuation1
Super-
annuation1
annuation1
$
$
$
Performance
Performance
rights
Performance
rights
$
rights
$
$
Equity-settled
Equity-settled
options
Equity-settled
options
$
options
$
$
Total
Total
$
Total
$
$
75,000
75,000
57,903
75,000
57,903
56,249
57,903
56,249
42,178
56,249
42,178
42,178
306,125
306,125
265,390
306,125
265,390
275,000
265,390
275,000
114,461
275,000
114,461
114,461
132,196
132,196
20,731
132,196
20,731
20,731
865,301
865,301
479,932
865,301
479,932
479,932
5,700
5,700
5,501
5,700
5,501
4,394
5,501
4,394
4,007
4,394
4,007
4,007
25,000
25,000
25,212
25,000
25,212
23,750
25,212
23,750
7,917
23,750
7,917
7,917
12,001
12,001
1,969
12,001
1,969
1,969
72,814
72,814
42,637
72,814
42,637
42,637
-
-
-
-
-
-
-
-
-
-
-
-
-
-
252,000
-
252,000
-
252,000
-
72,000
-
72,000
72,000
-
-
-
-
-
-
-
-
324,000
-
324,000
324,000
-
-
356,000
-
356,000
-
356,000
-
178,000
-
178,000
178,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
13,942
-
13,942
13,942
13,942
13,942
534,000
13,942
534,000
534,000
80,700
80,700
419,404
80,700
419,404
60,643
419,404
60,643
224,185
60,643
224,185
224,185
331,125
331,125
542,602
331,125
542,602
298,750
542,602
298,750
194,378
298,750
194,378
194,378
144,197
144,197
36,642
144,197
36,642
36,642
952,057
952,057
1,380,569
952,057
1,380,569
1,380,569
Non-Executive Directors
Non-Executive Directors
Malcolm Randall
Non-Executive Directors
Malcolm Randall
Malcolm Randall
Brendan O’Hara
Brendan O’Hara
Brendan O’Hara
Executive Directors
Executive Directors
Brett Hazelden
Executive Directors
Brett Hazelden
Brett Hazelden
Rudolph van Niekerk
Rudolph van Niekerk
Rudolph van Niekerk
KMP
KMP
Frederick Kotzee
KMP
Frederick Kotzee
Chris Achurch
Frederick Kotzee
Chris Achurch
Chris Achurch
Total
Total
Total
Total
Total
Total
Year
Year
Year
2018
2018
2017
2018
2017
2018
2017
2018
2017
2018
2017
2017
2018
2018
2017
2018
2017
2018
2017
2018
2017
2018
2017
2017
2018*
2018*
2018**
2018*
2018**
2018**
2018
2018
2017
2018
2017
2017
(*) Chief Financial Officer - Appointed on 13 November 2017 resigned 17 May 2018.
(*) Chief Financial Officer - Appointed on 13 November 2017 resigned 17 May 2018.
(**) Chief Financial Officer - Appointed on 17 May 2018. On 17 May 2018 1,000,000 options with an 18 month vesting
(**) Chief Financial Officer - Appointed on 17 May 2018. On 17 May 2018 1,000,000 options with an 18 month vesting
period and a total value of $173,488 were issued to the incoming Chief Financial Officer. The amount recognised is a
period and a total value of $173,488 were issued to the incoming Chief Financial Officer. The amount recognised is a
representation of the vesting period elapsed as at the reporting date.
representation of the vesting period elapsed as at the reporting date.
B. Service Agreements
B. Service Agreements
The Company has entered into an executive service agreement with Brett Hazelden in
The Company has entered into an executive service agreement with Brett Hazelden in
respect to his employment as the Managing Director of the Company. The principal terms
respect to his employment as the Managing Director of the Company. The principal terms
are as follows:
are as follows:
Brett Hazelden will receive an annual salary of $275,000 (excluding superannuation);
Brett Hazelden will receive an annual salary of $275,000 (excluding superannuation);
Brett Hazelden may terminate the agreement by giving 6 months’ notice in writing
Brett Hazelden may terminate the agreement by giving 6 months’ notice in writing
to the Company;
to the Company;
The Company may terminate the agreement (without cause) by giving 12 months’
1 Includes superannuation payment in Australia and any voluntary fee sacrifice to superannuation.
The Company may terminate the agreement (without cause) by giving 12 months’
notice in writing to Brett Hazelden (or make payment in lieu of notice), unless the
notice in writing to Brett Hazelden (or make payment in lieu of notice), unless the
Company is terminating as a result of a serious misconduct (or on other similar
Company is terminating as a result of a serious misconduct (or on other similar
grounds by Brett Hazelden, in which case no notice is required; and
grounds by Brett Hazelden, in which case no notice is required; and
Brett Hazelden is subject to non-compete restrictions during his employment and for
Brett Hazelden is subject to non-compete restrictions during his employment and for
a maximum period of 6 months following termination of his employment
a maximum period of 6 months following termination of his employment
1 Includes superannuation payment in Australia and any voluntary fee sacrifice to superannuation.
1 Includes superannuation payment in Australia and any voluntary fee sacrifice to superannuation.
Kalium Lakes Limited and Consolidated Entities
Kalium Lakes Limited and Consolidated Entities
7
7
39
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
Fair
Fair
Value
Value
Fair
per
per
Value
Option
Option
per
at Grant
at Grant
Option
Date
Date
at Grant
Date
$0.089
$0.089
Fair
$0.089
$0.089
$0.089
Value
$0.089
per
-
-
Option
-
-
-
at Grant
-
Date
$0.173
$0.173
$0.173
DIRECTORS’ REPORT (CONTINUED)
DIRECTORS’ REPORT continued
DIRECTORS’ REPORT continued
C. Share Based Payments
C. Share Based Payments
The following table sets out the details of unlisted share option movements during the year
The following table sets out the details of unlisted share option movements during the year
ended: 30 June 2018.
ended: 30 June 2018.
Balance at
Balance at
30 June
30 June
Balance at
2017
2017
30 June
2017
Grant Date Exercise
Grant Date Exercise
Grant Date Exercise
Price
Price
Price
Expiry Date Granted as
Expiry Date Granted as
Remunera
Remunera
Expiry Date Granted as
tion
tion
Remunera
tion
Exerc
ised
Exerc
ised
Exerc
ised
Expired
Expired
Expired
Balance at 30
June 2018
Balance at 30
June 2018
Balance at 30
June 2018
-
-
-
-
-
-
Price
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
17-May-21
-
Exerc
-
ised
-
Expired
-
Non-Executive Directors
Non-Executive Directors
Malcolm Randall
Malcolm Randall
Non-Executive Directors
Brendan O’Hara
Malcolm Randall
Brendan O’Hara
Executive Directors
Brendan O’Hara
Executive Directors
Brett Hazelden
Brett Hazelden
Executive Directors
Rudolph van Niekerk
Brett Hazelden
Rudolph van Niekerk
KMP
Rudolph van Niekerk
KMP
Chris Achurch (CFO)
Non-Executive Directors
Chris Achurch (CFO)
KMP
Malcolm Randall
Chris Achurch (CFO)
Total
Brendan O’Hara
Total
Executive Directors
Total
Brett Hazelden
Rudolph van Niekerk
KMP
Chris Achurch (CFO)
Non-Executive Directors
Malcolm Randall
Total
Brendan O’Hara
Executive Directors
Brett Hazelden
Rudolph van Niekerk
-
Expiry Date Granted as
-
Remunera
tion
16-Dec-19
16-Dec-19
16-Dec-19
16-Dec-19
16-Dec-19
16-Dec-19
-
-
-
-
-
-
17-May-21
16-Dec-19
17-May-21
16-Dec-19
16-Dec-16
$0.25
$0.25
16-Dec-16
Grant Date Exercise
$0.25
16-Dec-16
16-Dec-16
$0.25
16-Dec-16
$0.25
16-Dec-16
$0.25
-
-
-
-
-
-
-
-
-
-
-
-
17-May-18 $0.525
17-May-18 $0.525
$0.25
16-Dec-16
17-May-18 $0.525
$0.25
16-Dec-16
4,000,000
4,000,000
Balance at
2,000,000
4,000,000
2,000,000
30 June
2,000,000
2017
-
-
-
-
-
-
-
-
4,000,000
-
6,000,000
2,000,000
6,000,000
(*) On 17 May 2018 1,000,000 options with an 18 month vesting period and a total value of $173,488 were issued to
6,000,000
-
-
the incoming Chief Financial Officer. The amount recognised is a representation of the vesting period elapsed as at
Expired
Balance
(*) On 17 May 2018 1,000,000 options with an 18 month vesting period and a total value of $173,488 were issued to
-
-
the reporting date.
at 30
the incoming Chief Financial Officer. The amount recognised is a representation of the vesting period elapsed as at
the reporting date.
June
17-May-21
The following table sets out the details of unlisted share option movements during the year
2016
The following table sets out the details of unlisted share option movements during the year
ended: 30 June 2017.
-
ended: 30 June 2017.
-
Balance
at 30
Balance
Balance
-
June
at 30
at 30
-
2016
June
June
2016
2016
$0.25
16-Dec-16
$0.25
16-Dec-16
Grant Date Exercise
Price
Grant Date Exercise
Grant Date Exercise
-
-
Price
Price
-
-
4,000,000
2,000,000
Granted as
Remunera
Granted as
Granted as
-
tion
Remunera
Remunera
-
tion
tion
16-Dec-19
16-Dec-19
Expiry
Date
Expiry
Expiry
-
Date
Date
-
-
-
Exercis
ed
Exercis
Exercis
-
ed
ed
-
-
Fair Value
-
per Option
at Grant
Date
1,000,000
1,000,000
1,000,000
1,000,000
-
Granted as
-
Remunera
tion
-
1,000,000
-
Expired
-
-
Grant Date Exercise
17-May-18 $0.525
-
Exercis
-
ed
Expired
Expired
$0.089
$0.089
Expiry
Date
6,000,000
1,000,000
1,000,000
1,000,000
$0.173
Price
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Non-Executive Directors
Total
Malcolm Randall
Non-Executive Directors
Non-Executive Directors
Malcolm Randall
Brendan O’Hara
Malcolm Randall
Brendan O’Hara
Executive Directors
Brendan O’Hara
Brett Hazelden
Executive Directors
Executive Directors
Brett Hazelden
Rudolph van Niekerk
Brett Hazelden
Rudolph van Niekerk
Rudolph van Niekerk
Total
Total
Total
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
16-Dec-16
16-Dec-16
16-Dec-16
16-Dec-16
16-Dec-16
16-Dec-16
-
-
-
-
-
-
-
-
-
-
$0.25
$0.25
$0.25
$0.25
$0.25
$0.25
-
-
-
-
-
-
-
-
-
-
16-Dec-19
16-Dec-19
16-Dec-19
16-Dec-19
16-Dec-19
16-Dec-19
-
-
-
-
-
-
-
-
-
6,000,000
4,000,000
2,000,000
4,000,000
4,000,000
2,000,000
2,000,000
-
-
-
-
6,000,000
6,000,000
6,000,000
-
-
$0.089
$0.089
Fair Value
per Option
Fair Value
Fair Value
-
at Grant
per Option
per Option
-
Date
at Grant
at Grant
Date
Date
-
$0.089
$0.089
$0.089
$0.089
-
-
-
-
-
-
$0.089
$0.089
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
4,000,000
-
Balance at 30
2,000,000
-
-
June 2018
-
-
-
-
-
4,000,000
4,000,000
2,000,000
2,000,000
-
-
-
-
-
-
1,000,000
-
-
4,000,000
7,000,000
2,000,000
1,000,000
1,000,000
7,000,000
7,000,000
-
Balance at 30
-
June 2017
1,000,000
7,000,000
4,000,000
2,000,000
Balance at
30 June
Balance at
Balance at 30
-
2017
30 June
June 2017
-
2017
6,000,000
4,000,000
4,000,000
2,000,000
4,000,000
2,000,000
2,000,000
-
-
-
-
-
-
6,000,000
6,000,000
6,000,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
8
8
Kalium Lakes Limited and Consolidated Entities
Kalium Lakes Limited and Consolidated Entities
40
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
KMP
KMP
KMP
Total
Total
Total
Total
Total
Total
Non-Executive Directors
Non-Executive Directors
Non-Executive Directors
Malcolm Randall
Malcolm Randall
Malcolm Randall
Brendan O’Hara
Brendan O’Hara
Brendan O’Hara
Executive Directors
Executive Directors
Executive Directors
Brett Hazelden
Brett Hazelden
Brett Hazelden
Rudolph van Niekerk
Rudolph van Niekerk
Rudolph van Niekerk
Frederick Kotzee
Frederick Kotzee
Frederick Kotzee
Chris Achurch
Chris Achurch
Chris Achurch
Non-Executive Directors
Non-Executive Directors
Non-Executive Directors
Malcolm Randall
Malcolm Randall
Malcolm Randall
Brendan O’Hara
Brendan O’Hara
Brendan O’Hara
Executive Directors
Executive Directors
Executive Directors
Brett Hazelden
Brett Hazelden
Brett Hazelden
Rudolph van Niekerk
Rudolph van Niekerk
Rudolph van Niekerk
DIRECTORS’ REPORT continued
DIRECTORS’ REPORT continued
DIRECTORS’ REPORT continued
The following table sets out the details of performance rights movements during the year ended:
The following table sets out the details of performance rights movements during the year ended:
The following table sets out the details of performance rights movements during the year ended:
30 June 2018.
30 June 2018.
30 June 2018.
Balance at
Balance at
Balance at
30 June
30 June
30 June
2017
2017
2017
Balance at
Grant Date
Grant Date
Grant Date
30 June
2017
Grant Date
Expiry Date
Expiry Date
Expiry Date
Expiry Date
Granted as
Granted as
Granted as
Remuneration
Remuneration
Remuneration
Grant Date
Expiry Date
Granted as
Fair Value of
Fair Value of
Fair Value of
Remuneration
Performanc
Performanc
Performanc
e Right at
e Right at
e Right at
Grant Date
Grant Date
Grant Date
Granted as
Remuneration
Balance at
30 June
-
2017
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Expiry Date
Expiry Date
Expiry Date
Grant Date
4,200,000
4,200,000
4,200,000
1,200,000
1,200,000
1,200,000
02-Sep-16
02-Sep-16
02-Sep-16
02-Sep-16
02-Sep-16
02-Sep-16
4,200,000
1,200,000
02-Sep-21
02-Sep-21
-
-
-
-
-
-
5,400,000
5,400,000
5,400,000
Expiry Date
-
-
Balance at
Balance at
Balance at
30 June
30 June
30 June
2016
2016
2016
Granted as
-
-
Remuneration
$0.15
$0.15
$0.15
-
-
$0.15
$0.15
$0.15
-
-
-
-
-
-
-
-
Grant Date
-
-
Balance at
-
02-Sep-16
30 June
02-Sep-21
02-Sep-21
02-Sep-21
-
02-Sep-16
2017
02-Sep-21
02-Sep-21
02-Sep-21
-
Granted as
Granted as
Granted as
Expiry Date
-
Remuneration
Remuneration
Remuneration
-
-
-
02-Sep-16
-
-
-
-
02-Sep-16
-
-
-
-
-
-
-
-
-
-
-
-
02-Sep-16
-
Expiry Date
02-Sep-16
4,200,000
-
1,200,000
-
-
5,400,000
-
-
-
4,200,000
5,400,000
Grant Date
1,200,000
Balance at
30 June
2016
-
Grant Date
Grant Date
Grant Date
Balance at
-
30 June
5,400,000
-
2016
-
-
-
-
-
-
-
-
-
Fair Value of
-
Performance
Right at Grant
-
Exercised
Exercised
Exercised
Date
Fair Value of
-
Performance
-
-
Right at Grant
Date
-
02-Sep-21
-
-
-
-
02-Sep-21
-
-
-
-
-
-
-
-
-
-
-
-
02-Sep-21
-
Granted as
02-Sep-21
Remuneration
-
Fair Value of
Fair Value of
Fair Value of
Granted as
-
Performanc
Performanc
Performanc
Remuneration
-
e Right at
e Right at
e Right at
Grant Date
Grant Date
Grant Date
Non-Executive Directors
Malcolm Randall
Brendan O’Hara
Non-Executive Directors
Executive Directors
Malcolm Randall
Brett Hazelden
Brendan O’Hara
Rudolph van Niekerk
Executive Directors
KMP
Brett Hazelden
Frederick Kotzee
Non-Executive Directors
Rudolph van Niekerk
Chris Achurch
Malcolm Randall
KMP
Total
Brendan O’Hara
Frederick Kotzee
Executive Directors
Chris Achurch
Brett Hazelden
The following table sets out the details of performance rights movements during the year ended:
The following table sets out the details of performance rights movements during the year ended:
The following table sets out the details of performance rights movements during the year ended:
Total
Rudolph van Niekerk
30 June 2017.
30 June 2017.
30 June 2017.
KMP
Frederick Kotzee
Chris Achurch
Non-Executive Directors
Total
Malcolm Randall
Brendan O’Hara
Non-Executive Directors
Executive Directors
Malcolm Randall
Brett Hazelden
Brendan O’Hara
Rudolph van Niekerk
Executive Directors
Brett Hazelden
Non-Executive Directors
Rudolph van Niekerk
Malcolm Randall
Brendan O’Hara
Total
Executive Directors
Brett Hazelden
Rudolph van Niekerk
02-Sep-21
02-Sep-21
02-Sep-21
02-Sep-16
-
02-Sep-21
02-Sep-21
02-Sep-21
02-Sep-16
-
-
-
-
-
-
02-Sep-16
02-Sep-16
The following table sets out the details of ordinary share movements during the year ended: 30
The following table sets out the details of ordinary share movements during the year ended: 30
The following table sets out the details of ordinary share movements during the year ended: 30
Malcolm Randall
Total
June 2018.
June 2018.
June 2018.
Brendan O’Hara
Brett Hazelden
Malcolm Randall
Rudolph van Niekerk
Brendan O’Hara
Total
Brett Hazelden
Rudolph van Niekerk
Total
Malcolm Randall
Brendan O’Hara
Brett Hazelden
Malcolm Randall
Malcolm Randall
Malcolm Randall
Rudolph van Niekerk
Brendan O’Hara
Brendan O’Hara
Brendan O’Hara
Total
Brett Hazelden
Brett Hazelden
Brett Hazelden
Rudolph van Niekerk
Rudolph van Niekerk
Rudolph van Niekerk
Total
Total
Total
$0.15
$0.15
$0.15
4,200,000
$0.15
$0.15
$0.15
1,200,000
-
-
Received
5,400,000
-
-
-
Remunera
4,200,000
tion (No.
1,200,000
of Shares)
Received
-
Remunera
-
tion (No.
of Shares)
-
-
-
Received
-
-
Remunera
-
tion (No.
-
of Shares)
-
-
-
-
-
-
Balance at 30
445,375
June 2017
-
(No. of
Shares)
13,609,543
445,375
3,315,600
Balance at 30
-
17,370,518
June 2017
13,609,543
(No. of
3,315,600
Shares)
17,370,518
445,375
-
13,609,543
445,375
445,375
445,375
3,315,600
-
-
-
17,370,518
13,609,543
13,609,543
13,609,543
3,315,600
3,315,600
3,315,600
17,370,518
17,370,518
17,370,518
Disposals
-
-
-
Disposals
Disposals
Disposals
-
33,809
-
Disposals
-
-
-
-
59,523
-
-
-
93,332
-
33,809
-
-
-
59,523
-
-
-
93,332
Performan
Performan
Performan
-
Performance
ce
ce
ce
-
Rights/Options
Rights/Opt
Rights/Opt
Rights/Opt
-
Exercised (No.
ions
ions
ions
-
of Shares)
Excerised
Excerised
Excerised
-
-
(No. of
(No. of
(No. of
-
Shares)
Shares)
Shares)
-
-
-
Fair Value of
-
$0.15
Performance
-
$0.15
Right at Grant
Date
-
-
-
$0.15
-
-
-
-
$0.15
-
-
-
-
-
-
$0.15
$0.15
Balance at 30
June 2017
(No. of
Interest in Shares
Interest in Shares
Interest in Shares
Shares)
4,200,000
4,200,000
4,200,000
02-Sep-21
-
1,200,000
1,200,000
1,200,000
02-Sep-21
-
-
-
5,400,000
5,400,000
5,400,000
02-Sep-21
02-Sep-21
Additions
33,809
-
-
59,523
-
Additions
93,332
Performance
Rights/Options
Exercised (No.
of Shares)
Performance
Rights/Options
-
Exercised (No.
of Shares)
Balance at
-
-
-
-
-
02-Sep-16
30 June
-
-
-
-
02-Sep-16
-
2016
Balance at 30
Balance at 30
Balance at 30
June 2017
June 2017
June 2017
(No. of
(No. of
(No. of
Shares)
Shares)
Shares)
Received
Received
Received
Remunera
Remunera
Remunera
tion (No.
tion (No.
tion (No.
of Shares)
of Shares)
of Shares)
Granted as
-
-
-
-
4,200,000
Remuneration
-
-
-
-
1,200,000
33,809
33,809
33,809
-
-
-
59,523
59,523
59,523
-
-
-
93,332
93,332
93,332
Grant Date
-
-
-
-
-
-
-
-
Expiry Date
-
-
02-Sep-16
02-Sep-16
02-Sep-16
02-Sep-16
02-Sep-16
02-Sep-16
02-Sep-21
02-Sep-21
-
-
-
-
-
-
-
Additions
Additions
Additions
5,400,000
5,400,000
Additions
Disposals
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Total
-
-
-
-
-
-
-
-
D.
D.
D.
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Fair Value of
Exercised
Exercised
Exercised
Performance
Right at Grant
Date
Fair Value of
Performance
-
Right at Grant
-
-
-
-
Date
-
-
-
Fair Value of
-
$0.15
Performance
-
-
-
-
$0.15
Right at Grant
-
-
-
Date
$0.15
-
$0.15
-
-
-
-
-
-
$0.15
-
Exercised
$0.15
-
-
-
-
-
-
-
-
-
Exercised
Balance at
Balance at
Balance at
30 June
30 June
30 June
2018
2018
2018
Balance at
30 June
2018
Exercised
Balance at
30 June
-
2018
-
-
-
-
-
-
-
-
-
Exercised
-
4,200,000
-
-
1,200,000
-
Balance at
-
30 June
-
2018
4,200,000
4,200,000
4,200,000
1,200,000
1,200,000
1,200,000
-
-
-
-
-
-
-
-
-
5,400,000
5,400,000
5,400,000
-
Balance at
Balance at
Balance at
Exercised
-
30 June
30 June
30 June
-
2017
2017
2017
-
-
4,200,000
-
-
1,200,000
-
-
-
-
5,400,000
-
-
-
-
-
-
4,200,000
-
5,400,000
-
Balance at
1,200,000
-
30 June
2017
-
-
Balance at
-
-
30 June
5,400,000
-
-
2017
-
Exercised
-
4,200,000
-
-
1,200,000
-
Balance at
-
30 June
-
2017
-
-
-
-
-
-
4,200,000
4,200,000
4,200,000
-
5,400,000
-
-
1,200,000
1,200,000
1,200,000
-
-
Balance at 30 June
-
5,400,000
5,400,000
5,400,000
2018 (No. of Shares)
-
-
4,200,000
1,200,000
-
-
5,400,000
4,200,000
1,200,000
5,400,000
Balance at 30 June
Balance at 30 June
Balance at 30 June
2018 (No. of Shares)
2018 (No. of Shares)
2018 (No. of Shares)
-
Balance at 30 June
2018 (No. of Shares)
479,184
-
-
13,669,066
479,184
3,315,600
Balance at 30 June
-
17,463,850
2018 (No. of Shares)
13,669,066
3,315,600
17,463,850
479,184
-
13,669,066
3,315,600
17,463,850
479,184
479,184
479,184
-
-
-
13,669,066
13,669,066
13,669,066
3,315,600
3,315,600
3,315,600
17,463,850
17,463,850
17,463,850
Kalium Lakes Limited and Consolidated Entities
Kalium Lakes Limited and Consolidated Entities
Kalium Lakes Limited and Consolidated Entities
9
9
9
41
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
DIRECTORS’ REPORT (CONTINUED)
DIRECTORS’ REPORT continued
DIRECTORS’ REPORT continued
DIRECTORS’ REPORT continued
The following table sets out the details of ordinary share movements during the year ended: 30
The following table sets out the details of ordinary share movements during the year ended: 30
The following table sets out the details of ordinary share movements during the year ended: 30
June 2017.
June 2017.
June 2017.
Balance at
Balance at
Balance at
Balance at
30 June
30 June
30 June
30 June
2016 (No. of
2016 (No. of
2016 (No. of
2016 (No. of
Shares)
Shares)
Shares)
Shares)
Additions
Additions
Additions
Additions
(before
(before
(before
(before
Restructure)
Restructure)
Restructure)
Restructure)
(No. of Shares)
(No. of Shares)
(No. of Shares)
(No. of Shares)
Restructure
Restructure
Restructure
Restructure
(No. of
(No. of
(No. of
(No. of
shares) **
shares) **
shares) **
shares) **
Non-Executive Directors
Non-Executive Directors
Non-Executive Directors
Non-Executive Directors
Malcolm Randall
Malcolm Randall
Malcolm Randall
Malcolm Randall
Brendan O’Hara
Brendan O’Hara
Brendan O’Hara
Brendan O’Hara
Executive Directors
Executive Directors
Executive Directors
Executive Directors
Brett Hazelden
Brett Hazelden
Brett Hazelden
Brett Hazelden
Rudolph van Niekerk
Rudolph van Niekerk
Rudolph van Niekerk
Rudolph van Niekerk
Total
Total
Total
250,000
250,000
250,000
250,000
-
-
-
-
22,451,280
22,451,280
22,451,280
6,000,000
6,000,000
6,000,000
28,701,280
28,701,280
28,701,280
22,451,280
6,000,000
28,701,280
Total
375,000
375,000
375,000
375,000
-
-
-
-
2,176,920
2,176,920
2,176,920
-
Balance at
-
-
30 June
2,551,920
2016 (No. of
2,551,920
2,551,920
Shares)
2,176,920
-
2,551,920
(279,625)
-
(279,625)
(279,625)
(279,625)
-
-
-
(11,018,657)
(11,018,657)
(11,018,657)
(11,018,657)
(2,684,400)
Additions
(2,684,400)
(2,684,400)
(2,684,400)
(before
(13,982,682)
Restructure)
(13,982,682)
(13,982,682)
(No. of Shares)
(13,982,682)
Additions
Additions
Additions
Additions
(after
(after
(after
(after
Restructure)
Restructure)
Restructure)
Restructure)
(No. of
(No. of
(No. of
(No. of
Shares)
Shares)
Shares)
Shares)
Performance
Performance
Performance
Performance
Rights/Option
Rights/Option
Rights/Options
Rights/Option
s Excerised
s Excerised
Exercised (No.
s Excerised
(No. of
(No. of
of Shares)
(No. of
Shares)
Shares)
Shares)
Received
Received
Received
Received
Remunerati
Remunerati
Remunerati
Remunerati
on (No. of
on (No. of
on (No. of
on (No. of
Shares)
Shares)
Shares)
Shares)
Balance at
Balance at
Balance at
Balance at
30 June
30 June
30 June
30 June
2017 (No. of
2017 (No. of
2017 (No. of
2017 (No. of
Shares)
Shares)
Shares)
Shares)
100,000
100,000
100,000
100,000
-
-
-
-
-
-
-
-
-
Restructure
-
-
-
(No. of
100,000
shares) **
100,000
100,000
100,000
Additions
(after
Restructure)
(No. of
Shares)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Performance
-
-
-
Rights/Options
-
Exercised (No.
-
-
-
of Shares)
445,375
445,375
445,375
445,375
-
-
-
-
13,609,543
13,609,543
13,609,543
13,609,543
3,315,600
Received
3,315,600
3,315,600
3,315,600
Remunerati
17,370,518
on (No. of
17,370,518
17,370,518
17,370,518
Shares)
Balance at
30 June
2017 (No. of
Shares)
Revenue
EBITDA
EBIT
Loss after income tax
375,000
2017
-
$
250,000
2018
-
$
Non-Executive Directors
Malcolm Randall
Brendan O’Hara
Executive Directors
Brett Hazelden
Rudolph van Niekerk
** Kalium Lakes Potash Pty Ltd completed an approved restructure and consolidation of share
** Kalium Lakes Potash Pty Ltd completed an approved restructure and consolidation of share
-
** Kalium Lakes Potash Pty Ltd completed an approved restructure and consolidation of share
capital, the net effect of which resulted in the total number of ordinary shares in Kalium Lakes
capital, the net effect of which resulted in the total number of ordinary shares in Kalium Lakes
-
capital, the net effect of which resulted in the total number of ordinary shares in Kalium Lakes
Potash Pty Ltd decreasing by 35,823,432.
Potash Pty Ltd decreasing by 35,823,432.
Potash Pty Ltd decreasing by 35,823,432.
22,451,280
2,519,040
4,261,759
Other Director and KMP Transactions
6,000,000
Other Director and KMP Transactions
(10,696,683)
(5,917,009)
Other Director and KMP Transactions
There were no other transactions relating to Directors and KMP’s during the FY2018 period.
(10,900,473)
(5,952,926)
There were no other transactions relating to Directors and KMP’s during the FY2018 period.
There were no other transactions relating to Directors and KMP’s during the FY2018 period.
2,551,920
28,701,280
(10,757,324)
(5,889,309)
Additional Information
Additional Information
Additional Information
The earnings of the Consolidated Entity for the five years to 30 June 2018 are summarised below:
The earnings of the Consolidated Entity for the five years to 30 June 2018 are summarised below:
The earnings of the Consolidated Entity for the five years to 30 June 2018 are summarised below:
849,748
(3,645,685)
(3,647,069)
(3,647,069)
849,765
(1,464,114)
(1,464,114)
100,000
(1,464,114)
(11,018,657)
(2,684,400)
(279,625)
2016
-
$
2,176,920
-
100,000
2015
-
$
(13,982,682)
2014
$
-
-
-
-
-
-
-
Total
-
-
The factors that are considered to affect total shareholders return (“TSR”) are summarised below:
-
-
#
-
(6.95)
2017
$
2018
$
$0.36
-
$0.54
-
2017
2017
2017
$
$
$
2018
2018
2018
$
$
$
Revenue
EBITDA
EBIT
Loss after income tax
4,261,759
4,261,759
4,261,759
(10,696,683)
(10,696,683)
(10,696,683)
(10,900,473)
(10,900,473)
(10,900,473)
(10,757,324)
(10,757,324)
(10,757,324)
The factors that are considered to affect total shareholders return (“TSR”) are summarised below:
Share price at financial year end ($)
Total dividends declared (cents per share)
Basic and diluted earnings per share
(cents per share)
Revenue
Revenue
Revenue
EBITDA
EBITDA
EBITDA
EBIT
EBIT
EBIT
Loss after income tax
Loss after income tax
Loss after income tax
The factors that are considered to affect total shareholders return (“TSR”) are summarised below:
The factors that are considered to affect total shareholders return (“TSR”) are summarised below:
The factors that are considered to affect total shareholders return (“TSR”) are summarised below:
#
Share price at financial year end ($)
Share price at financial year end ($)
-
Total dividends declared (cents per share)
Share price at financial year end ($)
Share price at financial year end ($)
Total dividends declared (cents per share)
Basic and diluted earnings per share
Total dividends declared (cents per share)
Total dividends declared (cents per share)
Basic and diluted earnings per share
(cents per share)
Basic and diluted earnings per share
Basic and diluted earnings per share
(cents per share)
(cents per share)
(cents per share)
2,519,040
(4.30)
(5,917,009)
(5,952,926)
(5,889,309)
% of Equity Interest
30 June 2018 30 June 2017
100%
2016
2016
2016
$
2016
$
$
$
849,748
-
849,748
(3,645,685)
849,748
849,748
(3,645,685)
(3,647,069)
(3,645,685)
(3,645,685)
(3,647,069)
(3,647,069)
(3,647,069)
(3,647,069)
(3,647,069)
(3,647,069)
(3,647,069)
Subsidiary
Kalium Lakes Potash Pty Ltd *
2,519,040
2,519,040
2,519,040
(5,917,009)
(5,917,009)
(5,917,009)
(5,952,926)
(5,952,926)
(5,952,926)
(5,889,309)
(5,889,309)
(5,889,309)
Country of Incorporation
Australia
4,261,759
(5.40)
(10,696,683)
(10,900,473)
(10,757,324)
$0.36
$0.36
$0.36
-
-
-
(5.40)
(5.40)
(5.40)
(5.40)
#
#
#
-
-
-
(4.30)
(4.30)
(4.30)
(4.30)
$0.54
$0.54
$0.54
-
-
-
(6.95)
(6.95)
(6.95)
$0.54
-
$0.36
-
100%
(6.95)
-
-
2015
2015
2015
$
2015
$
$
$
849,765
-
849,765
(1,464,114)
849,765
849,765
(1,464,114)
(1,464,114)
(1,464,114)
(1,464,114)
(1,464,114)
(1,464,114)
(1,464,114)
(1,464,114)
(1,464,114)
(1,464,114)
(1,464,114)
-
-
-
-
-
-
-
-
-
-
-
-
# Kalium Lakes Limited was admitted to the official List of the Australian Securities Exchange
# Kalium Lakes Limited was admitted to the official List of the Australian Securities Exchange
# Kalium Lakes Limited was admitted to the official List of the Australian Securities Exchange
(ASX), on the 21st of December 2016.
(ASX), on the 21st of December 2016.
(ASX), on the 21st of December 2016.
End of Audited Remuneration Report.
End of Audited Remuneration Report.
End of Audited Remuneration Report.
% of Equity Interest
30 June 2018 30 June 2017
100%
Country of Incorporation
Australia
Subsidiary
Kalium Lakes Potash Pty Ltd *
100%
Kalium Lakes Limited and Consolidated Entities
Kalium Lakes Limited and Consolidated Entities
Kalium Lakes Limited and Consolidated Entities
10
10
10
42
-
-
-
-
-
445,375
-
13,609,543
3,315,600
17,370,518
2014
2014
2014
$
2014
$
$
$
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
DIRECTORS’ REPORT continued
PRINCIPAL ACTIVITIES
The principal activity of the Consolidated Entity is intended to be an exploration and mining
company.
REVIEW OF RESULTS
The loss after tax for the year ended 30 June 2018 was $10,757,324 (2017: $5,889,309 loss),
primarily as a result of exploration, development of the Beyondie Project.
CORPORATE
The results of the Pre-Feasibility Study (PFS) with maiden Ore Reserve were released on 3 October
2017, confirming low cost, long life and high margin Beyondie Sulphate of Potash Project (BSOPP).
During November 2017, $14.6M Placement and Share Placement Plan complete, resulting in
Kalium Lakes being fully funded through to completion of the Beyondie Bankable Feasibility Study.
KLL released its Annual Report to shareholders in October 2017 and then held its first Annual
General Meeting on 10 November 2017.
On 9 January 2018, shareholder approval for the ratification of Prior Placement Shares, the issue
of Further Placement Shares and issue of Advisor Options was received at a General Meeting held
at the Company’s office in Balcatta.
Later that month, the Company signed the second and final Native Title Agreement, covering the
eastern tenements required for the development of the BSOPP, with the Mungarlu
Ngurrarankatja Rirraunkaja (Aboriginal Corporation) RNTBC.
Early in June 2018, the Hon. Bill Johnston MLA, Minister of Mines and Petroleum, pursuant to the
Mining Act 1978 (WA), granted two Mining Leases for the (BSOPP).
As announced on 18 June 2018, an Offtake Terms Sheet was executed with German fertiliser
producer and distributor K+S for 100% of Stage 1 BSOPP production. The Offtake arrangement is
subject to the execution of a formal binding offtake agreement and satisfaction of certain
conditions precedent, including completion of due diligence by K+S.
Kalium Lakes Limited and Consolidated Entities
11
43
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 DIRECTORS’ REPORT (CONTINUED)
DIRECTORS’ REPORT continued
SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS
There were no significant changes in the state of affairs.
LIKELY DEVELOPMENTS AND EXPECTECTED RESULTS OF OPERATIONS
The Consolidated Entity intends to continue its exploration activities and mining activities on its
existing projects as well as develop the Carnegie Project according to the terms of the joint
venture agreement.
ENVIRONMENTAL REGULATIONS
The Consolidated Entity is subject to and is compliant with all aspects of environmental regulation
of its exploration and mining activities. The directors are not aware of any environmental law that
is not being complied with.
DIVIDENDS
No dividends were paid during the financial year and no recommendation has been made as to
payment of dividends.
EVENTS SUBSEQUENT TO REPORTING DATE
No matter or circumstance has arisen since the end of the financial year, which will significantly
affect, or may significantly affect, the state of affairs or operations of the reporting entity in future
financial periods other than the following:
As per ASX announcement on the 27 July 2018 and subsequent to the reporting date, BC Potash
Pty Ltd earned an additional 15% interest into the Carnegie Joint Venture (CJV). As at that date,
BC Potash hold a 30% interest in the CJV, with Kalium Lakes Potash Pty Ltd holding the remaining
70%.
INDEMNITY AND INSURANCE OF OFFICERS
The company has indemnified the directors and executives of the company for costs incurred, in
their capacity as a director or executive, for which they may be held personally liable, except
where there is a lack of good faith. During the financial year, the company paid a premium in
respect of a contract to insure the directors and executives of the company against a liability to
the extent permitted by the Corporations Act 2001. The contract of insurance prohibits disclosure
of the nature of the liability and the amount of the premium.
INDEMNITY AND INSURANCE OF AUDITOR
The company has not, during or since the end of the financial year, indemnified or agreed to
indemnify the auditor of the company or any related entity against a liability incurred by the
auditor. During the financial year, the company has not paid a premium in respect of a contract
to insure the auditor of the company or any related entity.
Kalium Lakes Limited and Consolidated Entities
12
44
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 DIRECTORS’ REPORT continued
PROCEEDINGS ON BEHALF OF THE COMPANY
No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to
bring proceedings on behalf of the company, or to intervene in any proceedings to which the
company is a party for the purpose of taking responsibility on behalf of the company for all or part
of those proceedings.
NON-AUDIT SERVICES
Details of the amounts paid or payable to the auditor for non-audit services provided during the
financial year by the auditor are outlined in note 7 to the financial statements. The directors are
satisfied that the provision of non-audit services during the financial year, by the auditor (or by
another person or firm on the auditor's behalf), is compatible with the general standard of
independence for auditors imposed by the Corporations Act 2001.
NON-AUDIT SERVICES (CONTINUED)
The directors are of the opinion that the services as disclosed in note 7 to the financial statements
do not compromise the external auditor's independence requirements of the Corporations Act
2001 for the following reasons:
all non-audit services have been reviewed and approved to ensure that they do not
impact the integrity and objectivity of the auditor; and
none of the services undermine the general principles relating to auditor independence
as set out in APES 110 Code of Ethics for Professional Accountants issued by the
Accounting Professional and Ethical Standards Board, including reviewing or auditing the
auditor's own work, acting in a management or decision-making capacity for the
company, acting as advocate for the company or jointly sharing economic risks and
rewards.
OFFICERS OF THE COMPANY WHO ARE FORMER PARTNERS OF RSM AUSTRALIA PARTNERS
There are no officers of the company who are former partners of RSM Australia Partners.
AUDITOR’S DECLARATION OF INDEPENDENCE
A copy of the auditor's independence declaration as required under section 307C of the
Corporations Act 2001 is set out immediately after this directors' report.
Kalium Lakes Limited and Consolidated Entities
13
45
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 DIRECTORS’ REPORT (CONTINUED)
DIRECTORS’ REPORT continued
AUDITOR
RSM Australia Partners continues in office in accordance with section 327 of the Corporations Act
2001.
This report is made in accordance with a resolution of directors, pursuant to section 298(2)(a) of
the Corporations Act 2001.
____________________
Brett Hazelden
Managing Director
10 September 2018
Kalium Lakes Limited and Consolidated Entities
14
46
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
CORPORATE GOVERNANCE STATEMENT
The Board of Directors is responsible for the corporate governance of Kalium Lakes Limited (the Company). The
Board of Directors has established a corporate governance framework which follows the recommendations as
set out in the ASX Corporate Governance Council’s Principles and Recommendations 3rd edition (“Principles
and Recommendations”).
The Company has followed each recommendation where the Board has considered the recommendation to be
an appropriate benchmark for the Company’s corporate governance practices. Where the Company’s corporate
governance practices follow a recommendation, the board has made appropriate statements reporting on
the adoption of the recommendation. In compliance with the “if not, why not” reporting regime, where the
Company’s corporate governance practices do not follow a recommendation, the Board explained its reasons
for not following the recommendation and disclosed what, if any, alternative practices the Company has
adopted instead of those in the recommendation.
The Company’s corporate governance framework can be viewed on the Company’s website:
www.kaliumlakes.com.au
47
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 AUDITOR’S INDEPENDENCE DECLARATION
RSM Australia Partners
Level 32, Exchange Tower
2 The Esplanade Perth WA 6000
GPO Box R1253 Perth WA 6844
T +61 8 9261 9100
F +61 8 9261 9111
www.rsm.com.au
AUDITOR’S INDEPENDENCE DECLARATION
As lead auditor for the audit of the financial report of Kalium Lakes Limited for the year ended 30 June 2018, I
declare that, to the best of my knowledge and belief, there have been no contraventions of:
(i)
The auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
(ii)
Any applicable code of professional conduct in relation to the audit.
RSM AUSTRALIA PARTNERS
Perth, Western Australia
10 September 2018
D J WALL
Partner
THE POWER OF BEING UNDERSTOOD
AUDIT | TAX | CONSULTING
RSM Australia Partners is a member of the RSM network and trades as RSM. RSM is the trading name used by the members of the RSM network. Each member of the RSM network is an independent
accounting and consulting firm which practices in its own right. The RSM network is not itself a separate legal entity in any jurisdiction.
RSM Australia Partners ABN 36 965 185 036
Liability limited by a scheme approved under Professional Standards Legislation
48
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER
COMPREHENSIVE INCOME FOR THE YEAR ENDED 30 JUNE 2018
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE
INCOME
FOR THE YEAR ENDED 30 JUNE 2018
Revenue
Other income
Expenditure
Accounting fees
Compliance fees
Depreciation
Directors and executive remuneration
Employee expenses
Exploration expenditure
Legal fees
Share based payment expense
Travel expenses
Other expenses
Loss before tax
Income tax expense
Note
30 June 2018
$
30 June 2017
$
3
4,261,759
2,519,040
(134,321)
(73,173)
(203,790)
(938,115)
(1,402,405)
(10,589,212)
(83,008)
(13,942)
(702,561)
(878,556)
(10,757,324)
(145,722)
(158,150)
(35,917)
(522,569)
(445,607)
(4,591,452)
(60,749)
(1,867,500)
(201,997)
(378,686)
(5,889,309)
-
-
21
5
4
6
Net loss for the year from operations
(10,757,324)
(5,889,309)
Other comprehensive income
Items that may be reclassified subsequently
to profit or loss
-
-
Total comprehensive loss for the year
(10,757,324)
(5,889,309)
Loss attributable to:
Owners of the parent
Total comprehensive loss attributable to:
Owners of the parent
(10,757,324)
(10,757,324)
(5,889,309)
(5,889,309)
(10,757,324)
(10,757,324)
(5,889,309)
(5,889,309)
Basic and diluted loss per share (cents)
8
(6.95)
(5.40)
The accompanying notes form part of these financial statements.
Kalium Lakes Limited and Consolidated Entities
17
49
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2018
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2018
ASSETS
Current Assets
Cash and cash equivalents
Trade and other receivables
Note
30 June
2018
$
30 June
2017
$
9
10
7,671,286
4,230,158
6,141,791
2,300,344
Total Current Assets
11,901,444
8,442,135
Non-Current Assets
Property, plant and equipment
Total Non-Current Assets
Total Assets
LIABILITIES
Current Liabilities
Trade and other payables
Provisions
Total Current Liabilities
Total Liabilities
Net Assets
EQUITY
Contributed equity
Reserves
Accumulated losses
Total Equity
11
1,865,404
466,544
1,865,404
466,544
13,766,848
8,908,679
12
13
3,751,621
337,438
2,179,799
53,421
4,089,059
2,233,220
4,089,059
2,233,220
9,677,789
6,675,459
14
15
16
29,265,527
2,170,078
(21,757,816)
15,667,451
2,008,500
(11,000,492)
9,677,789
6,675,459
The accompanying notes form part of these financial statements.
Kalium Lakes Limited and Consolidated Entities
18
50
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2018
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2018
Contributed
Equity
Reserves
$
Accumulated
losses
$
Total
$
$
6,353,421
-
-
-
-
-
-
(5,111,183)
(5,889,309)
-
(5,889,309)
1,242,238
(5,889,309)
-
(5,889,309)
10,663,200
(1,349,170)
-
15,667,451
-
-
2,008,500
2,008,500
-
-
-
(11,000,492)
10,663,200
(1,349,170)
2,008,500
6,675,459
15,667,451
-
-
-
2,008,500
-
-
-
(11,000,492)
(10,757,324)
-
(10,757,324)
6,675,459
(10,757,324)
-
(10,757,324)
14,600,654
(1,002,578)
-
29,265,527
-
-
161,578
2,170,078
-
-
-
(21,757,816)
14,600,654
(1,002,578)
161,578
9,677,789
Balance at 1 July 2016
Loss for the year
Other comprehensive income
Total comprehensive loss for the
year
Transactions with owners in their
capacity as owners:
Shares issued during the year
Security issue expenses
Share based payments
Balance at 30 June 2017
Balance at 1 July 2017
Loss for the year
Other comprehensive income
Total comprehensive loss for the
year
Transactions with owners in their
capacity as owners:
Shares issued during the year
Security issue expenses
Share based payments
Balance at 30 June 2018
The accompanying notes form part of these financial statements.
Kalium Lakes Limited and Consolidated Entities
19
51
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2018
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2018
Cash flows from operating activities
Receipts from operations
Payments to suppliers and employees
Payment for exploration and evaluation assets
Note
30 June
2018
$
30 June
2017
$
2,201,604
(4,170,410)
(9,019,369)
1,371,737
(2,068,911)
(2,768,160)
Net cash (used in) operating activities
18
(10,988,175)
(3,465,334)
Cash flows from investing activities
Interest received
Payments for plant and equipment
130,341
(1,358,383)
51,235
(491,360)
Net cash (used in) investing activities
(1,228,042)
(440,125)
Cash flows from financing activities
Proceeds from equity issues
Payment for costs of equity issues
14,600,654
(854,942)
10,603,000
(1,177,457)
Net cash provided by financing activities
13,745,712
9,425,543
Net increase in cash held
1,529,495
5,520,084
Cash and cash equivalents at beginning of the
financial year
6,141,791
621,707
Cash and cash equivalents at year end
9
7,671,286
6,141,791
The accompanying notes form part of these financial statements.
Kalium Lakes Limited and Consolidated Entities
20
52
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
1.
Corporate information
Kalium Lakes Limited (“Company”) is a public company which was incorporated in Western
Australia on 14 July 2016 as part of the restructure of Kalium Lakes Potash Pty Ltd (“KLP”) which
has been operating since October 2014. As a result of the restructure, KLP became a wholly
owned subsidiary of the Company following a share for share exchange, with each fully paid
ordinary share in KLP being exchanged for one fully paid ordinary share in the Company.
This annual reports covers Kalium Lakes Limited (the “Company”), a company incorporated in
Australia, and the entities it controlled at the end of, or during, the year ended 30 June 2018 (the
“Consolidated Entity”). The presentation currency of the Consolidated Entity is Australian Dollars
(“$”). A description of the Consolidated Entity’s operations is included in the review and results
of operations in the Directors’ report. The Directors’ report is not part of the financial statements.
The Company is a for-profit entity limited by shares and incorporated in Australia whose shares
are traded under the ASX code “KLL”.
2.
Accounting policies
Significant accounting policies
The principal accounting policies adopted in the preparation of the financial statements are set
out below. These policies have been consistently applied to all the years presented, unless
otherwise stated.
New or amended Accounting Standards and Interpretations adopted
The Consolidated Entity has adopted all of the new or amended Accounting Standards and
Interpretations issued by the Australian Accounting Standards Board ('AASB') that are mandatory
for the current reporting period.
Any new or amended Accounting Standards or Interpretations that are not yet mandatory have
not been early adopted.
Basis of preparation
The consolidated general purpose financial statements of the Consolidated Entity have been
prepared in accordance with the requirements of the Corporations Act 2001, Australian
Accounting Standards and other authoritative pronouncements of the Australian Accounting
Standards Board. Compliance with Australian Accounting Standards results in full compliance with
the International; Financial Reporting Standards (IFRS) as issued by the International Accounting
Standards Board (IASB). The financial report has also been prepared on a historical cost base. It
is recommended that the annual financial report be considered together with any public
announcements made by the Company during the year ended 30 June 2018 and up to the issue
date of this report, which the Consolidated Entity has made in accordance with its continuous
disclosure obligations arising under the Corporations Act 2001.
Kalium Lakes Limited and Consolidated Entities
21
53
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
Historical cost convention
The financial statements have been prepared under the historical cost convention, except for,
where applicable, the revaluation of available-for-sale financial assets, financial assets and
liabilities at fair value through profit or loss, investment properties, certain classes of property,
plant and equipment and derivative financial instruments.
Critical accounting estimates
The preparation of the financial statements requires the use of certain critical accounting
estimates. It also requires management to exercise its judgement in the process of applying the
Consolidated Entity's accounting policies. The areas involving a higher degree of judgement or
complexity, or areas where assumptions and estimates are significant to the financial statements,
are disclosed in note 2(a).
Parent entity information
In accordance with the Corporations Act 2001, these financial statements present the results of
the Consolidated Entity only. Supplementary information about the parent entity is disclosed in
note 19.
Basis of consolidation
The consolidated financial statements incorporate the assets and liabilities of all entities
controlled by the Company at the end of the reporting period. A controlled entity is any entity
over which the Company has the power to govern the financial and operating policies so as to
obtain benefits from the entity’s activities. Control will generally exist when the parent owns,
directly or indirectly through subsidiaries more than half of the voting power of the entity. In
assessing the power to govern, the existence and effect of holdings of actual and potential voting
rights are considered. The Company and its controlled entities together are referred to as the
Consolidated Entity. The effects of all transactions between entities in the Consolidated Entity are
eliminated in full. Where control of an entity is obtained during a financial year, its results are
included in the consolidated income statement from the date on which control commences.
Where control of an entity ceases during a financial year its results are included for that part of
the year during which control existed. The financial statements of subsidiaries are prepared for
the same reporting period as the parent company, using consistent accounting policies.
Current and non-current classification
Assets and liabilities are presented in the statement of financial position based on current and
non-current classification.
An asset is classified as current when: it is either expected to be realised or intended to be sold or
consumed in the Consolidated Entity's normal operating cycle; it is held primarily for the purpose
of trading; it is expected to be realised within 12 months after the reporting period; or the asset
is cash or cash equivalent unless restricted from being exchanged or used to settle a liability for
at least 12 months after the reporting period. All other assets are classified as non-current.
A liability is classified as current when: it is either expected to be settled in the Consolidated
Entity's normal operating cycle; it is held primarily for the purpose of trading; it is due to be settled
within 12 months after the reporting period; or there is no unconditional right to defer the
settlement of the liability for at least 12 months after the reporting period. All other liabilities are
classified as non-current.
Kalium Lakes Limited and Consolidated Entities
22
54
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
Joint operations
A joint operation is a joint arrangement whereby the parties that have joint control of the
arrangement have rights to the assets, and obligations for the liabilities, relating to the
arrangement. The Consolidated Entity has recognised its share of jointly held assets, liabilities,
revenues and expenses of joint operations. These have been incorporated in the financial
statements under the appropriate classifications.
Exploration, evaluation and development expenditure
Exploration and evaluation are written off as incurred. The group’s policy is that such costs will
only be carried forward when development of the area indicates that recoupment will occur or
where activities in the area have reached an advanced stage which permits reasonable
assessment of the existence of economically recoverable reserves.
Exploration, evaluation and development costs comprise acquisition costs, direct exploration and
evaluation costs and an appropriate portion of related overhead expenditure but do not include
general overhead expenditure which has no direct connection with a particular area of interest.
Revenue received from the sale or disposal of product, materials or services during the
exploration and evaluation phase of operation is offset against expenditure in respect of the area
of interest concerned.
When an area of interest is abandoned or the Directors decide that it is not commercially viable,
any accumulated costs in respect of that area are written off in the financial period the decision
is made. Each area of interest is also reviewed at the end of each accounting period and
accumulated costs written off to the extent that they will not be recoverable in the future.
Restoration costs arising from exploration activities are provided for at the time of the activities
which give rise to the need for restoration.
Amortisation is not charged on costs carried forward in respect of areas of interest in the
development phase until production commences. When production commences, carried forward
exploration, evaluation and development costs are amortised on a units of production basis over
the life of the economically recoverable reserves.
New Accounting Standards and Interpretations not yet mandatory or early adopted
Australian Accounting Standards and Interpretations that have recently been issued or amended
but are not yet mandatory, have not been early adopted by the Consolidated Entity for the annual
reporting period ended 30 June 2018. The Consolidated Entity's assessment of the impact of these
new or amended Accounting Standards and Interpretations, most relevant to the Consolidated
Entity, are set out below.
AASB 9 Financial Instruments
This standard is applicable to annual reporting periods beginning on or after 1 January 2018. The
standard replaces all previous versions of AASB 9 and completes the project to replace IAS 39
'Financial Instruments: Recognition and Measurement'. AASB 9 introduces new classification and
measurement models for financial assets. A financial asset shall be measured at amortised cost,
if it is held within a business model whose objective is to hold assets in order to collect contractual
cash flows, which arise on specified dates and solely principal and interest. All other financial
instrument assets are to be classified and measured at fair value through profit or loss unless the
Kalium Lakes Limited and Consolidated Entities
23
55
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018 (CONTINUED)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
entity makes an irrevocable election on initial recognition to present gains and losses on equity
instruments (that are not held-for-trading) in other comprehensive income ('OCI'). For financial
liabilities, the standard requires the portion of the change in fair value that relates to the entity's
own credit risk to be presented in OCI (unless it would create an accounting mismatch). New
simpler hedge accounting requirements are intended to more closely align the accounting
treatment with the risk management activities of the entity. New impairment requirements will
use an 'expected credit loss' ('ECL') model to recognise an allowance. Impairment will be
measured under a 12-month ECL method unless the credit risk on a financial instrument has
increased significantly since initial recognition in which case the lifetime ECL method is adopted.
The standard introduces additional new disclosures. The Consolidated Entity has made an
assessment and determined that this standard will have little to no impact on the entity as it does
not have any financial instruments.
AASB 15 Revenue from Contracts with Customers
This standard is applicable to annual reporting periods beginning on or after 1 January 2018. The
standard provides a single standard for revenue recognition. The core principle of the standard is
that an entity will recognise revenue to depict the transfer of promised goods or services to
customers in an amount that reflects the consideration to which the entity expects to be entitled
in exchange for those goods or services. The standard will require: contracts (either written,
verbal or implied) to be identified, together with the separate performance obligations within the
contract; determine the transaction price, adjusted for the time value of money excluding credit
risk; allocation of the transaction price to the separate performance obligations on a basis of
relative stand-alone selling price of each distinct good or service, or estimation approach if no
distinct observable prices exist; and recognition of revenue when each performance obligation is
satisfied. Credit risk will be presented separately as an expense rather than adjusted to revenue.
For goods, the performance obligation would be satisfied when the customer obtains control of
the goods. For services, the performance obligation is satisfied when the service has been
provided, typically for promises to transfer services to customers. For performance obligations
satisfied over time, an entity would select an appropriate measure of progress to determine how
much revenue should be recognised as the performance obligation is satisfied. Contracts with
customers will be presented in an entity's statement of financial position as a contract liability, a
contract asset, or a receivable, depending on the relationship between the entity's performance
and the customer's payment. Sufficient quantitative and qualitative disclosure is required to
enable users to understand the contracts with customers; the significant judgments made in
applying the guidance to those contracts; and any assets recognised from the costs to obtain or
fulfil a contract with a customer. The Consolidated Entity has made an assessment and
determined that this standard will have little to no impact on the entity as it currently does not
earn revenue.
AASB 16 Leases
This standard is applicable to annual reporting periods beginning on or after 1 January 2019. The
standard replaces AASB 117 'Leases' and for lessees will eliminate the classifications of operating
leases and finance leases. Subject to exceptions, a 'right-of-use' asset will be capitalised in the
statement of financial position, measured at the present value of the unavoidable future lease
payments to be made over the lease term. The exceptions relate to short-term leases of 12
months or less and leases of low-value assets (such as personal computers and small office
furniture) where an accounting policy choice exists whereby either a 'right-of-use' asset is
Kalium Lakes Limited and Consolidated Entities
24
56
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
recognised or lease payments are expensed to profit or loss as incurred. A liability corresponding
to the capitalised lease will also be recognised, adjusted for lease prepayments, lease incentives
received, initial direct costs incurred and an estimate of any future restoration, removal or
dismantling costs. Straight-line operating lease expense recognition will be replaced with a
depreciation charge for the leased asset (included in operating costs) and an interest expense on
the recognised lease liability (included in finance costs). In the earlier periods of the lease, the
expenses associated with the lease under AASB 16 will be higher when compared to lease
expenses under AASB 117. However EBITDA (Earnings Before Interest, Tax, Depreciation and
Amortisation) results will be improved as the operating expense is replaced by interest expense
and depreciation in profit or loss under AASB 16. For classification within the statement of cash
flows, the lease payments will be separated into both a principal (financing activities) and interest
(either operating or financing activities) component. For lessor accounting, the standard does not
substantially change how a lessor accounts for leases. The Consolidated Entity will adopt this
standard from 1 July 2019 and the impact of its adoption is being assessed by the consolidated
entity.
2(a). Critical accounting judgements, estimates and assumptions
The preparation of the financial statements requires management to make judgements, estimates
and assumptions that affect the reported amounts in the financial statements. Management
continually evaluates its judgements and estimates in relation to assets, liabilities, contingent
liabilities, revenue and expenses. Management bases its judgements, estimates and assumptions
on historical experience and on other various factors, including expectations of future events,
management believes to be reasonable under the circumstances. The resulting accounting
judgements and estimates will seldom equal the related actual results. The judgements, estimates
and assumptions that have a significant risk of causing a material adjustment to the carrying
amounts of assets and liabilities (refer to the respective notes) within the next financial year are
discussed below.
Share-based payment transactions
The Consolidated Entity measures the cost of equity-settled transactions with employees by
reference to the fair value of the equity instruments at the date at which they are granted. The
fair value is determined by using either the Binomial or Black-Scholes model, taking into account
the terms and conditions upon which the instruments were granted. The accounting estimates
and assumptions relating to equity-settled share-based payments would have no impact on the
carrying amounts of assets and liabilities within the next annual reporting period but may impact
profit or loss and equity.
Research & Development tax rebate
The receivable and corresponding revenue recognised at the reporting date for R&D is based on
estimates made by R&D tax specialists from the utilisation of historical cost data.
Kalium Lakes Limited and Consolidated Entities
25
57
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018(CONTINUED)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
Rehabilitation provision
A provision has been made for the anticipated costs for future rehabilitation of land explored or
mined. The Consolidated Entity's mining and exploration activities are subject to various laws and
regulations governing the protection of the environment. The Consolidated Entity recognises
management's best estimate for assets retirement obligations and site rehabilitations in the
period in which they are incurred. Actual costs incurred in the future periods could differ
materially from the estimates. Additionally, future changes to environmental laws and regulations
could affect the carrying amount of this provision.
Kalium Lakes Limited and Consolidated Entities
26
58
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
3.
Other income
Foreign exchange gain
Other income
Interest income
Research and development tax offset - International
Research and development tax offset - Domestic
30 June
2018
$
30 June
2017
$
68,425
182,176
143,149
1,660,634
2,207,375
-
37,745
63,617
655,577
1,762,101
4,261,759
2,519,040
Accounting policy:
Research and development tax offset
Research and development tax offset revenue is recognised when it is received or when the right
to receive payment is established. Revenue is measured at the fair value of the consideration
received or receivable.
Interest
Revenue is recognised as interest accrues using the effective interest method. This is a method of
calculating the amortised cost of a financial asset and allocating the interest income over the
relevant period using the effective interest rate, which is the rate that exactly discounts estimated
future cash receipts through the expected life of the financial asset to the net carrying amount of
the financial asset.
4.
Other expenses
Bank charges
Insurance
Subscriptions
Other consultants
Head office and administration
3,978
33,826
62,813
350,803
427,136
1,635
23,411
21,607
-
332,033
878,556
378,686
Kalium Lakes Limited and Consolidated Entities
27
59
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018(CONTINUED)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
5.
Share based payment expense
Unlisted director, officers & advisor options (i)
Performance rights (ii)
30 June
2018
$
30 June
2017
$
13,942
-
667,500
1,200,000
13,942
1,867,500
Year ended 30 June 2018: Entity issued the following Options:
-
-
-
29 September 2017: 330,882 Options issued to advisors with a fair value of $57,276.
9 January 2018: 843,936 Options issued to advisors with a fair value of $90,360.
17 May 2018: 1,000,000 Options issued to KMP (CFO) with a fair value of $173,488 and a
vesting period of 18 months. Amount recognised as an expense during the financial year
ended 30 June 2018 was $13,942. The total fair value will be recognised over the
remaining vesting period.
Prior year ended 30 June 2017: Entity issued the following Options:
-
16 December 2016: 9,000,000 Options with a fair value of $808,500.
(i) Set out below are summaries of options granted and outstanding at 30 June 2018:
Options
1 July 2016
Grant
Date
Expiry
Date
Granted Exercised Expired
Director
16-12-16
16-12-19
6,000,000
Officers
16-12-16
16-12-19
1,500,000
Advisors
30 June 2017
Advisors
Advisors
KMP
30 June 2018
16-12-16
16-12-19
29-09-17
09-01-18
17-05-18
29-09-20
09-01-20
17-05-21
1,500,000
9,000,000
330,882
843,936
1,000,000
11,174,818
-
-
-
-
-
-
-
Balance at
the end of
the period
-
-
-
6,000,000
1,500,000
-
1,500,000
9,000,000
330,882
-
843,936
-
-
1,000,000
- 11,174,818
Kalium Lakes Limited and Consolidated Entities
28
60
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
5.
Share based payment expense (continued)
Options issued 1 July 2017 to 30 June 2018:
Stock Price
Exercise Price
Expiry Period
Expected future volatility
Risk free rate
Dividend yield
Amount of Options
Fair value of Options
Advisors Advisors
$0.410
$0.420
$0.525
$0.425
2 Years
3 Years
60%
60%
1.94%
2.12%
0%
0%
330,882 843,936 1,000,000
$57,276* $90,360* $173,488
KMP
$0.460
$0.525
3 Years
60%
2.24%
0%
* Fair value of Options issued to advisors were treated as share issue costs in the consolidated
statement of changes in equity.
Options issued 1 July 2016 to 30 June 2017:
Assumptions
Stock Price
Exercise Price
Expiry Period
Expected future volatility
Risk free rate
Dividend yield
Amount of Options
Fair value of Options
Directors
$0.20
$0.25
3 Years
80%
1.5%
0%
Officers
$0.20
$0.25
3 Years
80%
1.5%
0%
6,000,000 1,500,000 1,500,000
$133,500 $141,000*
$534,000
Advisor
$0.20
$0.25
3 Years
80%
1.5%
0%
* Fair value of Options issued to advisors were treated as share issue costs in the consolidated
statement of changes in equity.
Kalium Lakes Limited and Consolidated Entities
29
61
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018(CONTINUED)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
5.
Share based payment expense (continued)
(ii) Prior year ended 30 June 2017: Performance Rights granted
A total of 20,000,000 Performance Rights were granted to the founding shareholders of KLP
during the year ended 30 June 2017. The following performance criteria is required to be achieved
from the date of issue:
Performance criteria Probability %
- 5 million Performance Rights upon completion of a Definitive Feasibility Study; 60%
- 5 million Performance Rights upon securing funding for the development 40%
and construction of the commercial sulphate of potash (SOP) product operation; and
- 10 million Performance Rights upon achievement of the first 30%
commercial production of SOP.
Performance rights
granted to directors
Performance rights
granted to a consultant
Number
Grant Date
Expiry Date
Share price at grant date
Share based payment expense
5,400,000
2nd September 2016
2nd September 2021
$0.15
$324,000
14,600,000
2nd September 2016
2nd September 2021
$0.15
$876,000
The Consolidated Entity used judgement in estimating the probability of the performance
criteria being met at grant date.
Based on the probability of the non vesting conditions being met (performance criteria), as at
the grant date, $1,200,000 was recognised as a share based payment. As at the date of this
report, none of the performance criteria had been met.
Accounting policy:
Equity settled compensation
The Consolidated Entity provides benefits to employees (including Directors and a Consultant) of
the Consolidated Entity and other service providers or strategic equity partners in the form of
share-based payment transactions, whereby employees or other parties render services or
provide goods in exchange for shares or rights over shares (“equity-settled transactions”). The
cost of these equity-settled transactions with employees is measured by reference to the fair
value at the date at which they are granted. The fair value is determined using an option pricing
method. In valuing equity-settled transactions, no account is taken of any vesting conditions,
other than conditions linked to the price of the shares of the Company (“market conditions”). The
cost of equity-settled transactions is recognised in the statement of comprehensive income,
together with a corresponding increase in equity, over the period in which the performance
and/or service conditions are fulfilled, ending on the date on which the relevant employees
become fully entitled to the award (“vesting date”). The cumulative expense recognised for
equity-settled transactions at each reporting date until the vesting date reflects:
Kalium Lakes Limited and Consolidated Entities
30
62
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
5.
Share based payment expense (continued)
i)
ii)
The extent to which the vesting period has expired; and
The number of awards that, in the opinion of the Directors of the Consolidated Entity,
will ultimately vest. This opinion is formed based on the best available information at
reporting date. No adjustment is made for the likelihood of market performance
conditions being met as the effect of these conditions is included in the determination
of fair value at grant date.
Where an equity-settled award is cancelled, it is treated as if it had vested on the date of
cancellation, and any expense not yet recognised for the award is recognised immediately. No
expense is recognised for awards that do not ultimately vest, except for awards where vesting is
conditional upon a market condition. However, if a new award is substituted for the cancelled
award, and designated as a replacement award on the date that it is granted, the cancelled and
new award are treated as if they were a modification of the original award, as described in the
previous paragraph. Where shares are issued at a discount to fair value either by reference to the
current market price or by virtue of the Consolidated Entity providing financing for the share
purchase on favourable terms, the value of the discount is considered a share based payment.
The dilutive effect, if any, of outstanding options is reflected as additional share dilution in the
computation of earnings per share.
30 June
2018
$
30 June
2017
$
6.
Income tax expense
A reconciliation between the income tax expense and the product of accounting profit before
income tax multiplied by the Consolidated Entity’s applicable income tax rate is as follows:
Loss before Income tax
(10,757,324)
(5,889,309)
Prima facie benefit on operating loss at 27.5% (2017: 27.5%)
Non allowable expenditure
Unrecognised deferred tax assets attributable to tax losses
Income tax expenses
2,958,264
(1,257,604)
(1,700,660)
-
1,619,560
(1,089,851)
(529,709)
-
Tax losses available
8,110,433
1,926,213
A potential deferred tax asset, attributable to tax losses carried forward, amounts to
approximately $2,230,369 (2017: $529,709) and has not been brought to account at reporting
date because the directors do not believe it is appropriate to regard realisation of the deferred
tax asset as probable at this point in time. This benefit will only be obtained if:
• the Consolidated Entity derives future assessable income of a nature and of an amount sufficient
to enable the benefit from the deductions for the loss incurred;
Kalium Lakes Limited and Consolidated Entities
31
63
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018(CONTINUED)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
6.
Income tax expense (continued)
• the Consolidated Entity continues to comply with the conditions for deductibility imposed by
law; and
• no changes in tax legislation adversely affect the Consolidated Entity in realising the benefit
from the deductions for the loss incurred.
Accounting policy:
Income tax
Current income tax assets and liabilities for the current and prior periods are measured at the
amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax
laws used to compute the amount are those that are enacted or substantively enacted by the
reporting date.
Deferred income tax is provided on all temporary differences at the reporting date between the
tax bases of assets and liabilities and their carrying amounts for financial reporting purposes.
Deferred income tax assets and liabilities are recognised for all taxable temporary differences:
Except for deferred income tax liabilities arising from the initial recognition of an asset or
liability in a transaction that is not a business combination and at the time of the
transaction affects neither the accounting profit nor taxable profit or loss; and
In respect of taxable temporary differences associated with investments in subsidiaries,
associates and interests in joint ventures except where the timing of the reversal of the
temporary differences can be controlled and it is probable that the temporary differences
will not reverse in the foreseeable future.
The carrying amount of deferred income tax assets is reviewed at each reporting date and reduced
to the extent that it is no longer probable that sufficient taxable profit will be available to allow
all or part of the deferred income tax asset to be utilised. Unrecognised deferred income tax
assets are reassessed at each reporting date and are recognised to the extent that it has become
probable that future taxable profit will allow the deferred income tax to be recovered. Deferred
income tax assets and liabilities are measured at the tax rates that are expected to apply to the
year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that
have been enacted or substantively enacted at the reporting date. Income taxes relating to items
recognised directly in equity are recognised in equity and not in profit or loss. Deferred tax assets
and deferred tax liabilities are offset only if a legally enforceable right exists to set off current tax
assets against current tax liabilities and the deferred tax assets and liabilities relate to the same
taxable entity and the same taxation authority.
Goods and services and sales tax
Revenues, expenses and assets are recognised net of the amount of Goods and Services Tax (GST)
except:
Where the amount of GST incurred is not recoverable from the taxation authority, it is
recognised as part of the cost of the asset or as part of an item of expense; or
For receivables and payables which are recognised inclusive of GST.
The net amount of GST recoverable from, or payable to, the taxation authority is included as part
of receivables or payables.
Kalium Lakes Limited and Consolidated Entities
32
64
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
7.
Auditor’s remuneration
Audit and review of the financial report
Research and development tax
Taxation and technical advice services
8.
Earnings/(loss) per share
30 June
2018
$
30 June
2017
$
38,000
29,464
61,067
42,450
18,796
45,296
128,531
106,542
The following reflects the earnings/(loss) and number of shares used in the calculation of the basic
and diluted earnings/(loss) per share.
Basic loss per share (cents per share)
Diluted loss per share (cents per share)
Net loss attributable to ordinary shareholders ($)
(6.95)
(6.95)
(10,757,324)
(5.40)
(5.40)
(5,889,309)
Weighted average number of ordinary shares used in the
calculation of basic loss per share
Weighted average number of ordinary shares used in the
calculation of diluted loss per share
Accounting policy:
Shares
154,695,310
109,115,547
154,695,310
109,115,547
Basic earnings per share is calculated as net profit/(loss) attributable to members of the parent,
adjusted to exclude any costs of servicing equity (other than dividends), divided by the weighted
average number of ordinary shares, adjusted for any bonus element. The diluted earnings per
share is calculated as net profit or loss attributable to members of the parent dividend by the
weighted average number of ordinary shares and dilutive potential ordinary shares, adjusted for
any bonus element. The weighted average number of shares was based on the consolidated
weighted average number of shares in the reporting period. The net profit or loss attributable to
members of the parent is adjusted for:
Costs of servicing equity (other than dividends) and preference share dividends;
The after-tax effect of dividends and interest associated with dilutive potential ordinary
shares that have been recognised as expenses; and
Other non-discretionary changes in revenue or expenses during the period that would
result from the dilution of potential ordinary shares.
Kalium Lakes Limited and Consolidated Entities
33
65
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018(CONTINUED)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
30 June
2018
$
30 June
2017
$
4,157,744*
3,513,542
1,592,744
4,549,047
7,671,286
6,141,791
9.
Cash and cash equivalents
Cash at bank
Cash on deposit
(*) Includes EURO 671,450 (AUD $1,061,632).
Accounting policy:
Cash and cash equivalents include cash on hand and in the bank, and other short-term deposits.
Bank overdrafts are shown separately in current liabilities on the Statement of Financial Position.
For the purposes of the Statement of Cash Flows, cash and cash equivalents as defined above are
net of outstanding bank overdrafts.
10.
Trade and other receivables
Current
GST refundable
Prepayments
Research and development tax offset
Accrued interest
Fuel rebate
Accounting policy:
30 June
2018
$
30 June
2017
$
306,434
16,382
3,868,009
25,671
13,662
386,683
19,878
1,881,400
12,383
-
4,230,158
2,300,344
Trade receivables, which are due for settlement no more than 30 days from the date of the final
invoice, are recognised initially at fair value and subsequently measured at amortised cost using
the effective interest method, less any allowance for uncollectable amounts. The difference
between the carrying value of receivables and the present value of the expected future cash flows
are accounted for against the carrying value of receivables as an interest charge.
Kalium Lakes Limited and Consolidated Entities
34
66
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
11.
Property, plant and equipment
Exploration
Equipment
$
Office
Equipment
$
Motor
Vehicles
$
Leasehold
Improve-
ments
Rehab-
ilitation
asset
Total
$
Carrying value
30 June 2016
Additions
Depreciation
Carrying value
30 June 2017
9,999
1,102
-
370,498
(29,699)
15,425
(2,387)
105,437
(3,831)
350,798
14,140
101,606
-
-
-
-
-
-
-
-
11,101
491,360
(35,917)
466,544
Additions
Depreciation
1,300,726
(169,298)
7,037
(6,856)
43,677
(27,636)
6,832
-
244,378
-
1,602,650
(203,790)
Carrying value
30 June 2018
1,482,226
14,321
117,647
6,832
244,378
1,865,404
Accounting policy:
Property, plant and equipment are recorded at historical cost less accumulated depreciation and
any impairment. The carrying value of assets is reviewed for impairment at the reporting date. An
asset is immediately written down to its recoverable amount if the carrying value of the asset
exceeds its estimated recoverable amount. The depreciation rates per annum for each class of
fixed asset are as follows:
20%
Exploration equipment:
33%
Office equipment:
Motor vehicles: 20%
Leasehold Improvements: 50%
Rehabilitation asset: *
(*) Rehabilitation asset and the corresponding provision (Note 13), is undiscounted and has not
been depreciated. Depreciation and corresponding finance charges incurred in the unwinding of
the provision will be recognised from the commencement of production.
Subsequent expenditure relating to an item of property, plant and equipment, that has already
been recognised, is added to the carrying amount of the asset if the recognition criteria are met.
All assets are depreciated over their anticipated useful lives (or period of the lease term if the
shorter there-of), up to their residual values using a straight-line depreciation basis. These useful
lives are determined on the day of capitalisation and are re-assessed annually by Management.
Kalium Lakes Limited and Consolidated Entities
35
67
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018(CONTINUED)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
11.
Property, plant and equipment (continued)
Impairment
The carrying values of plant and equipment are reviewed for impairment when events or changes
in circumstances indicate the carrying value may not be recoverable or at least on an annual basis.
For an asset that does not generate largely independent cash inflows, the recoverable amount is
determined for the cash-generating unit to which the asset belongs. If any such indication exists
and where the carrying values exceed the estimated recoverable amounts, the assets or cash
generating units are written down to their recoverable amount.
12.
Trade and other payables
Current
Accounts payable
Other payables
Accrued expenses
Accounting policy:
30 June
2018
$
30 June
2017
$
3,285,903
117,683
348,035
2,061,056
88,643
30,100
3,751,621
2,179,799
Trade and other payables amounts represent liabilities for goods and services provided to the
entity prior to the end of the financial year and which are unpaid. The amounts are unsecured
and are usually paid within 30 days of invoice.
13.
Provisions
Current
Employee entitlements
Rehabilitation
Accounting policy:
93,060
244,378
337,438
53,421
-
53,421
Short-term employee benefits
Liabilities for wages and salaries, including non-monetary benefits, annual leave and long service
leave expected to be settled wholly within 12 months of the reporting date are measured at the
amounts expected to be paid when the liabilities are settled.
Kalium Lakes Limited and Consolidated Entities
36
68
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
13.
Provisions (continued)
Other long-term employee benefits
The liability for annual leave and long service leave not expected to be settled within 12 months
of the reporting date are measured at the present value of expected future payments to be made
in respect of services provided by employees up to the reporting date using the projected unit
credit method. Consideration is given to expected future wage and salary levels, experience of
employee departures and periods of service. Expected future payments are discounted using
market yields at the reporting date on corporate bonds with terms to maturity and currency that
match, as closely as possible, the estimated future cash outflows.
Provisions
Provisions are recognised when the Consolidated Entity has a present (legal or constructive)
obligation as a result of a past event, it is probable the Consolidated Entity will be required to settle
the obligation, and a reliable estimate can be made of the amount of the obligation. The amount
recognised as a provision is the best estimate of the consideration required to settle the present
obligation at the reporting date, taking into account the risks and uncertainties surrounding the
obligation. If the time value of money is material, provisions are discounted using a current pre-
tax rate specific to the liability. The increase in the provision resulting from the passage of time is
recognised as a finance cost.
14.
Contributed equity
Balance at 1 July 2016
Reconstruction of KLP capital**
Share issue: 04-Aug-16
Share issue: 02-Nov-16 (Advisor shares)
Share issue: 16-Dec-16 (Pursuant to the IPO)
Share issue: 23-May-17
Share issue costs
Balance at 30 June 2017
Share Issue: 29-Nov-17
Share Issue: 01-Dec-17
Share Issue: 19-Dec-17
Share Issue: 22-Jan-18
Share Issue Costs
30 June
2017/2018
No.
$
126,631,507
(35,823,432)
686,665
300,000
30,000,000
13,235,295
-
6,353,421
-
103,200
60,000
6,000,000
4,500,000
(1,349,170)
135,030,035
15,667,451
29,471,793
476,191
1,005,922
3,809,524
12,378,154
200,000
422,500
1,600,000
(1,002,578)
Balance at 30 June 2018
** Kalium Lakes Potash Pty Ltd completed an approved restructure and consolidation of share
capital, the net effect of which resulted in the total number of ordinary shares in Kalium Lakes
Potash Pty Ltd decreasing by 35,823,432.
169,793,465
29,265,527
Kalium Lakes Limited and Consolidated Entities
37
69
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018(CONTINUED)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
14.
Contributed equity (continued)
Ordinary shares
Ordinary shares have no par value and have the right to receive dividends as declared and, in the
event of the winding up of the Company, to participate in proceeds from the sale of all surplus
assets in proportion to the number of and amounts paid up on the shares held. Ordinary shares
entitle their holder to one vote, either in person or by proxy, at a meeting of the Company.
Capital management
Management controlled the capital of the Consolidated Entity in order to maintain a capital
structure that ensured the lowest cost of capital available to the Consolidated Entity.
Management’s objective is to ensure the Consolidated Entity continues as a going concern as well
as to maintain optimal returns to shareholders.
Accounting Policy:
Share capital
Share capital represents the nominal value of shares that have been issued. Any transaction costs
associated with the issuing of shares are deducted from share capital, net of any related income
tax benefits. Accumulated losses include all current and prior period retained profits. Dividend
distributions payable to equity shareholders are included in ‘other liabilities’ when the dividends
have been approved in a general meeting prior to the reporting date. All transactions with owners
of the parent are recorded separately within equity.
15.
Reserves
Options reserve (i)
Performance rights reserve (ii)
Movements in reserves
(i) Options reserve
Balance at 1 July 2016
New options issued and vested
Unlisted director & officers options
Unlisted advisor options – security issue expenses
Balance at 30 June 2017
30 June
2018
$
30 June
2017
$
970,078
1,200,000
808,500
1,200,000
2,170,078
2,008,500
No of Options
Value $
-
-
7,500,000
1,500,000
667,500
141,000
9,000,000
808,500
New options issued and vested
Unlisted advisor options – security issue expenses
330,882
57,276
Kalium Lakes Limited and Consolidated Entities
38
70
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
15.
Reserves (continued)
Unlisted advisor options – security issue expenses
New options issued and vesting over 18 months
Unlisted KMP options
843,936
90,360
1,000,000
13,942*
Balance at 30 June 2018
11,174,818
970,078
(*) On 17 May 2018, 1,000,000 options with an 18 month vesting period and a total value of $173,488 were issued to
the incoming Chief Financial Officer. The amount recognised is a representation of the vesting period elapsed as at the
reporting date.
(ii) Performance rights
Balance at 1 July 2016
Performance rights issued
Balance at 30 June 2017
Performance rights issued
Balance at 30 June 2018
-
1,200,000
1,200,000
-
1,200,000
30 June
2017
$
30 June
2018
$
16.
Accumulated losses
Balance at beginning of year
Loss after tax attributable to the equity holders of the parent
entity during the year
(11,000,492)
(5,111,183)
(10,757,324)
(5,889,309)
Balance at end of year
(21,757,816)
(11,000,492)
17.
Operating segments
The Consolidated Entity has considered the requirements of AASB8 – Operating Segments and
has identified its operating segments based on the internal reports that are reviewed and used by
the board of directors (chief operating decision makers) in assessing performance and
determining the allocation of resources.
The Consolidated Entity operates as a single segment being the exploration for minerals in
Australia.
The Consolidated Entity is domiciled in Australia. All revenue from external parties is generated
from Australia only and all assets are located in Australia only.
Kalium Lakes Limited and Consolidated Entities
39
71
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018(CONTINUED)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
18.
Reconciliation of cashflows from operating activities
Loss before tax
Depreciation
Share based payment expense
Interest income
Movement in trade & other receivables
Movement in trade & other payables
30 June
2018
$
(10,757,324)
203,790
13,942
(130,341)
(1,929,813)
1,611,571
30 June
2017
$
(5,889,309)
35,917
1,867,500
(51,235)
(1,421,182)
1,992,975
Net cash used in operating activities
(10,988,175)
(3,465,334)
19.
Parent company information
Current assets
Total assets
Current liabilities
Total liabilities
Net Assets
Loss of the parent entity
Total comprehensive loss of the parent entity
3,738,924
9,964,064
296,275
296,275
9,677,789
8,907,876*
8,908,333*
106,619*
106,619*
8,801,714*
(876,075)
(876,075)
(2,885,158)*
(2,885,158)*
* Kalium Lakes Limited (“Company”) is a public company which was incorporated in Western
Australia on 14 July 2016.
Guarantees
Kalium Lakes Limited has not entered into any guarantees.
Other Commitments and Contingencies
Kalium Lakes Limited has no commitments and contingencies.
Plant and Equipment Commitments
Kalium Lakes Limited has no commitments to acquire property, plant and equipment.
Signficant Accounting Policies
Kalium Lakes Limited accounting policies do not differ from the Consolidated Entity as disclosed
in Note 2.
Kalium Lakes Limited and Consolidated Entities
40
72
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
20.
Events after the end of the reporting period
No matter or circumstance has arisen since the end of the financial year, which will significantly
affect, or may significantly affect, the state of affairs or operations of the reporting entity in future
financial periods other than the following:
As per ASX announcement on the 27 July 2018 and subsequent to the reporting date, BC Potash
Pty Ltd earned an additional 15% interest into the Carnegie Joint Venture (CJV). As at that date,
BC Potash hold a 30% interest in the CJV, with Kalium Lakes Potash Pty Ltd holding the remaining
70%.
21.
Related party transactions
Parent Entity
Kalium Lakes Limited is the Parent Entity.
Subsidiaries
Interests in subsidiaries are set out in Note 22.
Key Management Personnel (KMP)
Disclosures relating to key management personnel are set out below and in the remuneration
report in the Directors' Report.
Short term employee benefits
Post-employment benefits
Directors’ and KMP remuneration
Equity based payments
30 June
2018
$
865,301
72,814
938,115
13,942
30 June
2017
$
479,932
42,637
522,569
858,000
952,057
1,380,569
Transactions with Related Parties
Purchase of exploration equipment from Inceptioneer Pty Ltd totalled $45,100 during the period.
Mr Brett Hazelden (executive director) is a director of Inceptioneer Pty Ltd.
Receivables from and Payables to Related Parties
There were no payables to or receivables from related parties at the current and previous
reporting date.
Loans to/from Related Parties
There were no loans payable to or receivable from related parties at the current and previous
reporting date.
Kalium Lakes Limited and Consolidated Entities
41
73
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
Balance at
Additions
Restructure
Additions
Performance
Received
Balance at
30 June
(before
(No. of
(after
Rights/Options
Remunerati
30 June
2016 (No. of
Restructure)
shares) **
Restructure)
Exercised (No.
on (No. of
2017 (No. of
Shares)
(No. of Shares)
of Shares)
Shares)
Shares)
Non-Executive Directors
Malcolm Randall
Brendan O’Hara
Executive Directors
250,000
375,000
(279,625)
100,000
-
-
Brett Hazelden
22,451,280
2,176,920
(11,018,657)
Rudolph van Niekerk
6,000,000
(2,684,400)
-
-
(No. of
Shares)
-
-
-
Total
28,701,280
2,551,920
(13,982,682)
100,000
-
-
-
-
-
445,375
-
13,609,543
3,315,600
17,370,518
2018
$
2017
$
2016
$
2015
$
2014
$
-
-
-
-
-
-
-
-
-
-
-
-
Revenue
849,765
4,261,759
(10,696,683)
EBITDA
(1,464,114)
(10,900,473)
EBIT
(1,464,114)
(10,757,324)
Loss after income tax
(1,464,114)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
The factors that are considered to affect total shareholders return (“TSR”) are summarised below:
FOR THE YEAR ENDED 30 JUNE 2018(CONTINUED)
Share price at financial year end ($)
Total dividends declared (cents per share)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Basic and diluted earnings per share
FOR THE YEAR ENDED 30 JUNE 2018
FOR THE YEAR ENDED 30 JUNE 2018
(cents per share)
2,519,040
(5,917,009)
(5,952,926)
(5,889,309)
849,748
(3,645,685)
(3,647,069)
(3,647,069)
$0.54
-
$0.36
-
(5.40)
(6.95)
(4.30)
#
-
-
-
-
22.
22.
Controlled Entities
Controlled Entities
Subsidiary
Subsidiary
Subsidiary
Kalium Lakes Potash Pty Ltd *
Kalium Lakes Potash Pty Ltd *
Kalium Lakes Potash Pty Ltd *
Country of Incorporation
Country of Incorporation
Country of Incorporation
Australia
Australia
Australia
% of Equity Interest
% of Equity Interest
% of Equity Interest
30 June 2018 30 June 2017
30 June 2017
30 June 2018
30 June 2017
30 June 2018
100%
100%
100%
100%
100%
100%
* Kalium Lakes Limited (“Company”) is a public company which was incorporated in Western
* Kalium Lakes Limited (“Company”) is a public company which was incorporated in Western
Australia on 14 July 2016 as part of the restructure of Kalium Lakes Potash Pty Ltd (“KLP”) which
Australia on 14 July 2016 as part of the restructure of Kalium Lakes Potash Pty Ltd (“KLP”) which
has been operating since October 2014. As a result of the restructure, KLP is now a wholly owned
has been operating since October 2014. As a result of the restructure, KLP is now a wholly owned
subsidiary of the Company following a share for share exchange, with each fully paid ordinary
subsidiary of the Company following a share for share exchange, with each fully paid ordinary
share in KLP being exchanged for one fully paid ordinary share in the Company.
share in KLP being exchanged for one fully paid ordinary share in the Company.
23.
23.
Financial risk management
Financial risk management
The Consolidated Entity’s overall financial risk management strategy is to ensure that the
The Consolidated Entity’s overall financial risk management strategy is to ensure that the
Consolidated Entity is able to fund its business operations and expansion plans. Exposure to credit
Consolidated Entity is able to fund its business operations and expansion plans. Exposure to credit
risk, liquidity risk, foreign currency risk, interest rate risk and commodity price risk arises in the
risk, liquidity risk, foreign currency risk, interest rate risk and commodity price risk arises in the
normal course of the Consolidated Entity’s business. The Consolidated Entity’s risk management
normal course of the Consolidated Entity’s business. The Consolidated Entity’s risk management
strategy is set by and performed with the close co-operation with the Board and focuses on
strategy is set by and performed with the close co-operation with the Board and focuses on
actively securing the Consolidated Entity’s short to medium-term cash flows by limiting credit risk
actively securing the Consolidated Entity’s short to medium-term cash flows by limiting credit risk
of customers, regular review of its working capital and minimising the exposure to financial
of customers, regular review of its working capital and minimising the exposure to financial
markets. The Consolidated Entity does not actively engage in the trading of financial assets for
markets. The Consolidated Entity does not actively engage in the trading of financial assets for
speculative purposes nor does it write options. The most significant financial risks to which the
speculative purposes nor does it write options. The most significant financial risks to which the
Consolidated Entity is exposed are described below.
Consolidated Entity is exposed are described below.
Financial assets and liabilities
Financial assets and liabilities
The financial assets and liabilities for financial years ended 30 June 2018 and 30 June 2017 are
The financial assets and liabilities for financial years ended 30 June 2018 and 30 June 2017 are
reflected at amortised cost, and are not fair valued through the Statement of comprehensive
reflected at amortised cost, and are not fair valued through the Statement of comprehensive
income.
income.
Specific financial risk exposures and management
Specific financial risk exposures and management
The main risks the Consolidated Entity is exposed to through its financial instruments are credit
The main risks the Consolidated Entity is exposed to through its financial instruments are credit
risk, liquidity risk and interest rate risk.
risk, liquidity risk and interest rate risk.
a) Credit risk
a) Credit risk
Credit risk arises from the financial assets of the Consolidated Entity, which comprise cash and
Credit risk arises from the financial assets of the Consolidated Entity, which comprise cash and
cash equivalents and trade and other receivables. Exposure to credit risk relating to financial
cash equivalents and trade and other receivables. Exposure to credit risk relating to financial
assets arises from the potential non-performance by counterparties of contractual obligations
assets arises from the potential non-performance by counterparties of contractual obligations
that could lead to a financial loss to the Consolidated Entity.
that could lead to a financial loss to the Consolidated Entity.
Kalium Lakes Limited and Consolidated Entities
Kalium Lakes Limited and Consolidated Entities
42
42
74
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
FOR THE YEAR ENDED 30 JUNE 2018
FOR THE YEAR ENDED 30 JUNE 2018
23.
23.
23.
Financial risk management (continued)
Financial risk management (continued)
Financial risk management (continued)
b) Liquidity Risk
b) Liquidity Risk
b) Liquidity Risk
Liquidity risk is the risk that there will be inadequate funds available to meet financial
Liquidity risk is the risk that there will be inadequate funds available to meet financial
Liquidity risk is the risk that there will be inadequate funds available to meet financial
commitments as they fall due. The Consolidated Entity recognises the on-going requirements to
commitments as they fall due. The Consolidated Entity recognises the on-going requirements to
commitments as they fall due. The Consolidated Entity recognises the on-going requirements to
have committed funds in place to cover both existing business cash flows and provide reasonable
have committed funds in place to cover both existing business cash flows and provide reasonable
have committed funds in place to cover both existing business cash flows and provide reasonable
headroom for cyclical debt fluctuations and capital expenditure programs. The key funding
headroom for cyclical debt fluctuations and capital expenditure programs. The key funding
headroom for cyclical debt fluctuations and capital expenditure programs. The key funding
objective is to ensure the availability of flexible and competitively priced funding from alternative
objective is to ensure the availability of flexible and competitively priced funding from alternative
objective is to ensure the availability of flexible and competitively priced funding from alternative
sources to meet the Consolidated Entity’s current and future requirements. The Consolidated
sources to meet the Consolidated Entity’s current and future requirements. The Consolidated
sources to meet the Consolidated Entity’s current and future requirements. The Consolidated
Entity utilises a detailed cash flow model to manage its liquidity risk. This analysis shows that
Entity utilises a detailed cash flow model to manage its liquidity risk. This analysis shows that
Entity utilises a detailed cash flow model to manage its liquidity risk. This analysis shows that
available sources of funds are expected to be sufficient over the lookout period. The Consolidated
available sources of funds are expected to be sufficient over the lookout period. The Consolidated
available sources of funds are expected to be sufficient over the lookout period. The Consolidated
Entity attempts to accurately project the sources and uses of funds which provide an effective
Entity attempts to accurately project the sources and uses of funds which provide an effective
Entity attempts to accurately project the sources and uses of funds which provide an effective
framework for decision making and budgeting. The table below summarises the maturity profile
framework for decision making and budgeting. The table below summarises the maturity profile
framework for decision making and budgeting. The table below summarises the maturity profile
of the Company’s contractual cash flow financial liabilities based on contractual undiscounted
of the Company’s contractual cash flow financial liabilities based on contractual undiscounted
of the Company’s contractual cash flow financial liabilities based on contractual undiscounted
repayment obligations. Repayments, which are subject to notice, are treated as if notice were to
repayment obligations. Repayments, which are subject to notice, are treated as if notice were to
repayment obligations. Repayments, which are subject to notice, are treated as if notice were to
be given immediately.
be given immediately.
be given immediately.
Consolidated
Consolidated
Consolidated
Consolidated
As at 30 June 2018
As at 30 June 2018
As at 30 June 2018
As at 30 June 2018
Trade and other payables
Trade and other payables
Trade and other payables
Trade and other payables
Total liabilities
Total liabilities
Total liabilities
Total liabilities
As at 30 June 2017
As at 30 June 2017
As at 30 June 2017
As at 30 June 2017
Trade and other payables
Trade and other payables
Trade and other payables
Trade and other payables
Total liabilities
Total liabilities
Total liabilities
Total liabilities
Consolidated
30 days
30 days
30 days
30 days
$
$
$
$
1-3
1-3
1-3
1-3
months
months
months
months
$
$
$
$
3-12
3-12
3-12
3-12
months
months
months
months
$
$
$
$
Total
Total
Total
Total
$
$
$
$
3,449,461
3,449,461
3,449,461
3,449,461
3,449,461
3,449,461
3,449,461
3,449,461
302,160
302,160
302,160
302,160
302,160
302,160
302,160
302,160
- 3,751,621
3,751,621
3,751,621
3,751,621
- 3,751,621
3,751,621
3,751,621
3,751,621
-
-
-
-
-
-
1,771,683
1,771,683
1,771,683
1,771,683
30 days
1,771,683
$
1,771,683
1,771,683
1,771,683
1-3
410,316
410,316
410,316
410,316
months
410,316
$
410,316
410,316
410,316
3-12
months
$
(2,200) 2,179,799
2,179,799
2,179,799
2,179,799
Total
(2,200) 2,179,799
$
2,179,799
2,179,799
2,179,799
(2,200)
(2,200)
(2,200)
(2,200)
(2,200)
(2,200)
Interest Rate Risk
Interest Rate Risk
Interest Rate Risk
302,160
302,160
3,449,461
3,449,461
As at 30 June 2018
c)
c)
c)
Trade and other payables
Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will
Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will
Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will
Total liabilities
fluctuate because of changes in market interest rates. The Consolidated Entity is exposed to
fluctuate because of changes in market interest rates. The Consolidated Entity is exposed to
fluctuate because of changes in market interest rates. The Consolidated Entity is exposed to
As at 30 June 2017
2018
interest rate movements through the term deposits at a fixed rate of between 1.75% and 2.42%
interest rate movements through the term deposits at a fixed rate of between 1.75% and 2.42%
interest rate movements through the term deposits at a fixed rate of between 1.75% and 2.42%
Trade and other payables
Financial assets
per annum, dependant on days invested. The following table sets out the variable interest bearing
per annum, dependant on days invested. The following table sets out the variable interest bearing
per annum, dependant on days invested. The following table sets out the variable interest bearing
Total liabilities
Cash and cash equivalents
and fixed interest bearing financial instruments of the Consolidated Entity:
and fixed interest bearing financial instruments of the Consolidated Entity:
and fixed interest bearing financial instruments of the Consolidated Entity:
Total
2017
Financial assets
Cash and cash equivalents
Total
(2,200) 2,179,799
(2,200) 2,179,799
4,157,744
4,157,744
Variable interest
Variable interest
Variable interest
Variable interest
$
$
$
$
Variable interest
$
Fixed interest
Fixed interest
Fixed interest
Fixed interest
$
$
$
$
- 3,751,621
- 3,751,621
1,771,683
1,771,683
1,592,744
1,592,744
410,316
410,316
Fixed interest
$
3,513,542
3,513,542
4,549,047
4,549,047
2018
2018
2018
2018
Financial assets
Financial assets
Financial assets
Financial assets
Cash and cash equivalents
Cash and cash equivalents
Cash and cash equivalents
Cash and cash equivalents
Total
Total
Total
Total
2017
2017
2017
2017
Financial assets
Financial assets
Financial assets
Financial assets
Impact on pre-tax profit
Cash and cash equivalents
Cash and cash equivalents
Cash and cash equivalents
Cash and cash equivalents
Interest rates + 1%
Total
Total
Total
Total
Interest rates – 1%
4,157,744
4,157,744
4,157,744
4,157,744
4,157,744
4,157,744
4,157,744
4,157,744
30 June 2018
$
1,592,744
1,592,744
1,592,744
1,592,744
41,577
1,592,744
1,592,744
1,592,744
1,592,744
(41,577)
3,513,542
3,513,542
3,513,542
3,513,542
3,513,542
3,513,542
3,513,542
3,513,542
30 June 2017
$
4,549,047
4,549,047
4,549,047
4,549,047
15,927
4,549,047
4,549,047
4,549,047
4,549,047
(15,927)
Name
Carnegie Joint Operation
Impact on pre-tax profit
Interest rates + 1%
Interest rates – 1%
Kalium Lakes Limited and Consolidated Entities
Kalium Lakes Limited and Consolidated Entities
Kalium Lakes Limited and Consolidated Entities
Country of Incorporation
Australia
30 June 2018
$
41,577
(41,577)
% of Ownership Interest
30 June 2018 30 June 2017
30 June 2017
85%*
85%*
$
15,927
(15,927)
43
43
43
Name
Carnegie Joint Operation
Country of Incorporation
Australia
% of Ownership Interest
30 June 2018 30 June 2017
85%*
85%*
75
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
Consolidated
As at 30 June 2018
Trade and other payables
Total liabilities
As at 30 June 2017
Trade and other payables
Total liabilities
1-3
3-12
30 days
months
months
$
$
$
Total
$
3,449,461
3,449,461
302,160
302,160
- 3,751,621
- 3,751,621
1,771,683
1,771,683
410,316
410,316
(2,200) 2,179,799
(2,200) 2,179,799
Variable interest
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
$
FOR THE YEAR ENDED 30 JUNE 2018(CONTINUED)
4,157,744
4,157,744
Fixed interest
$
3,513,542
3,513,542
2018
Financial assets
Cash and cash equivalents
Total
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
2017
FOR THE YEAR ENDED 30 JUNE 2018
FOR THE YEAR ENDED 30 JUNE 2018
Financial assets
Financial risk management (continued)
Financial risk management (continued)
Cash and cash equivalents
Total
23.
23.
1,592,744
1,592,744
4,549,047
4,549,047
The following table illustrates the estimated sensitivity to a 1% increase and decrease to interest
The following table illustrates the estimated sensitivity to a 1% increase and decrease to interest
rate movements.
rate movements.
Impact on pre-tax profit
Impact on pre-tax profit
Impact on pre-tax profit
Interest rates + 1%
Interest rates + 1%
Interest rates + 1%
Interest rates – 1%
Interest rates – 1%
Interest rates – 1%
30 June 2018
30 June 2018
30 June 2018
$
$
$
41,577
41,577
41,577
(41,577)
(41,577)
(41,577)
30 June 2017
30 June 2017
30 June 2017
$
$
$
15,927
15,927
15,927
(15,927)
(15,927)
(15,927)
% of Ownership Interest
d) Foreign currency risk
d) Foreign currency risk
30 June 2018 30 June 2017
The Consolidated Entity undertakes certain transactions denominated in foreign currency and is
The Consolidated Entity undertakes certain transactions denominated in foreign currency and is
85%*
exposed to foreign currency risk through foreign exchange rate fluctuations.
exposed to foreign currency risk through foreign exchange rate fluctuations.
Country of Incorporation
Australia
Name
Carnegie Joint Operation
85%*
Foreign exchange risk arises from future commercial transactions and recognised financial assets
Foreign exchange risk arises from future commercial transactions and recognised financial assets
and financial liabilities denominated in a currency that is not the entity's functional currency. The
and financial liabilities denominated in a currency that is not the entity's functional currency. The
risk is measured using sensitivity analysis and cash flow forecasting.
risk is measured using sensitivity analysis and cash flow forecasting.
The Consolidated Entity periodically transfers amounts held in its functional currency, into foreign
The Consolidated Entity periodically transfers amounts held in its functional currency, into foreign
currency, based on committed expenditures payable, in order to effectively mitigate against
currency, based on committed expenditures payable, in order to effectively mitigate against
fluctuations in foreign exchange rates.
fluctuations in foreign exchange rates.
The Group has cash and cash equivalents and trade and other payables denominated in EUR of
The Group has cash and cash equivalents and trade and other payables denominated in EUR of
AUD$1,061,632 and AUD$1,896,923 respectively (2017: AUD$Nil and AUD$148,284). At 30 June
AUD$1,061,632 and AUD$1,896,923 respectively (2017: AUD$Nil and AUD$148,284). At 30 June
2018, if EUR/AUD rates had changed by 10% with all other variables held constant, the
2018, if EUR/AUD rates had changed by 10% with all other variables held constant, the
consolidated entity's loss before tax for the year would have been AUD$83,529 lower/higher (30
consolidated entity's loss before tax for the year would have been AUD$83,529 lower/higher (30
June 2017: AUD$14,828 lower/higher).
June 2017: AUD$14,828 lower/higher).
A sensitivity of 10% (10%: 2017) has been selected as this is considered reasonable given the
A sensitivity of 10% (10%: 2017) has been selected as this is considered reasonable given the
current level of volatility in the EUR/AUD rate.
current level of volatility in the EUR/AUD rate.
Accounting policy:
Accounting policy:
Financial assets
Financial assets
Initial recognition and measurement
Initial recognition and measurement
Financial assets are categorised as financial assets at fair value through profit or loss, loans and
Financial assets are categorised as financial assets at fair value through profit or loss, loans and
receivables, held-to-maturity investments, available for sale financial assets or as derivatives
receivables, held-to-maturity investments, available for sale financial assets or as derivatives
designated as hedging instruments in an effective hedge, as appropriate. The Consolidated Entity
designated as hedging instruments in an effective hedge, as appropriate. The Consolidated Entity
determines the categorisation of its financial assets at initial recognition. Categorisation is re-
determines the categorisation of its financial assets at initial recognition. Categorisation is re-
evaluated at each financial year end. When financial assets are recognised initially, they are
evaluated at each financial year end. When financial assets are recognised initially, they are
measured at fair value plus transaction costs, except where the instrument is classified as “at fair
measured at fair value plus transaction costs, except where the instrument is classified as “at fair
value through profit or loss”, in which case transaction costs are expensed to profit or loss
value through profit or loss”, in which case transaction costs are expensed to profit or loss
immediately.
immediately.
Kalium Lakes Limited and Consolidated Entities
Kalium Lakes Limited and Consolidated Entities
44
44
76
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
23.
Financial risk management (continued)
Subsequent measurement
Loans and receivables are non-derivative financial assets with fixed or determinable payments
that are not quoted in an active market and are subsequently re-measured at amortised cost.
Loans and receivables are included in current assets, except for those which are not expected to
mature in twelve months after the end of the period.
De-recognition of financial assets
A financial asset (or, where applicable a part of a financial asset or part of a group of similar
financial assets is de-recognised when:
The rights to receive cash flows from the asset have expired; or
The Consolidated Entity has transferred its rights to receive cash flows from the asset or
has assumed an obligation to pay the received cash flows in full without material delay to
a third party under a ‘pass-through’ arrangement; and either
o The Consolidated Entity has transferred substantially all the risks and rewards of
the asset, or
o The Consolidated Entity has neither transferred nor retained substantially all the
risks and rewards of the asset, but has transferred control of the asset.
Impairment of financial assets
The Consolidated Entity assesses at each reporting date whether there is any objective evidence
that a financial asset or a group of financial assets is impaired. A financial asset or a group of
financial assets is deemed to be impaired if, and only if, there is objective evidence of impairment
as a result of one or more events that have occurred after the initial recognition of the asset (an
incurred ‘loss event’) and that loss event has an impact on the estimated future cash flows of the
financial asset or the group of financial assets that can be reliably estimated. Evidence of
impairment may include indications that the debtors or a group of debtors is experiencing
significant financial difficulty, default or delinquency in interest or in principal payments, the
probability that they will enter bankruptcy or other financial reorganisation and where observable
data indicates that there is a measurable decrease in the estimated future cash flows, such as
changes in arrears or economic conditions that correlate with defaults.
Financial liabilities
Initial recognition
Financial liabilities within the scope of AASB139 are classified as financial liabilities at fair value
through profit or loss, loans and borrowings, or as derivatives designated as heading instruments
in an effective hedge, as appropriate. The Consolidated Entity determines the classification of its
financial liabilities at initial recognition. Financial liabilities are recognised initially at fair value
and in the case of loans and borrowings include directly attributable transaction costs. The
Consolidated Entity’s financial liabilities include trade and other payables, bank overdraft, loans
and borrowings and derivative financial instruments.
Kalium Lakes Limited and Consolidated Entities
45
77
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018(CONTINUED)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
23.
Financial risk management (continued)
Subsequent measurement
The measurement of financial liabilities depends on their classification as follows:
i.
At fair value through profit or loss
Financial liabilities at fair value through profit or loss includes financial liabilities held for trading
and financial liabilities designated upon initial recognition as at fair value through profit or loss.
Financial liabilities are classified as held for trading if they are acquired for the purpose of selling
in the near term. This category includes derivative financial instruments entered into by the
Consolidated Entity that are not designated as hedging instruments in hedge relationships as
defined by AASB 39. Separate embedded derivatives are also classified as held for trading unless
they are designated as effective hedging instruments. Gains or losses on liabilities held for trading
are recognised in the income statement. The Consolidated Entity has not designated any financial
liabilities upon initial recognition as at fair value through profit or loss. Options granted that are
not part of a continuing share based payment relationship (i.e. there is no ongoing provision of
goods and/or services and are denominated in a currency other than the entity’s functional
currency) are accounted for as derivative liabilities in accordance with AASB 139: “Financial
Instruments: Recognition and Measurement” and IFRIC guidelines. Such options are recorded on
the balance sheet at fair value with movements in fair value of the derivative liability, during the
period and cumulatively, is not attributable to changes in the credit risk of that liability. In
addition, contractual arrangements whereby the Company agrees to issue a variable number of
shares are accounted for as a liability. To the extent that these contractual arrangements meet
the definition of a derivative, the value of the contractual arrangement is recorded on the balance
sheet at fair value with movements in fair value being recorded in the income statement.
De-recognition
A financial liability is de-recognised when the obligation under the liability is discharged or
cancelled or expires. When an existing financial liability is replaced by another from the same
lender on substantially different terms, or the terms of an existing liability are substantially
modified, such an exchange or modification is treated as a de-recognition of the original liability
and the recognition of a new liability, and the difference in the respective carrying amounts is
recognised in the income statement.
24.
Contingent liabiltiies
The Consolidated Entity has no contingent liabilities as at 30 June 2018.
25.
Commitments
Kalium Lakes Limited had $2,490,163 worth of rental, rates and expenditure commitments
relating to its tenements as at 30 June 2018 and other commitments of $380,000 relating to
Engineering work for the Consolidated Entity’s Bankable Feasibility Study.
Kalium Lakes Limited and Consolidated Entities
46
78
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
FOR THE YEAR ENDED 30 JUNE 2018
Consolidated
26.
26.
Interests in joint operations
Interests in joint operations
30 days
$
1-3
months
$
3-12
months
$
Total
$
As at 30 June 2018
Trade and other payables
Total liabilities
As at 30 June 2017
Trade and other payables
Total liabilities
On 1 March 2017 The Consolidated Entity and BC Potash Pty Ltd announced that the companies
On 1 March 2017 The Consolidated Entity and BC Potash Pty Ltd announced that the companies
- 3,751,621
had entered into a joint operation over Kalium’s 100% owned Carnegie Project.
had entered into a joint operation over Kalium’s 100% owned Carnegie Project.
- 3,751,621
3,449,461
3,449,461
302,160
302,160
The Carnegie Joint Operation (CJO) is focussed on the exploration and development of the
The Carnegie Joint Operation (CJO) is focussed on the exploration and development of the
(2,200) 2,179,799
Carnegie Potash Project (CPP) in Western Australia, which is located approximately 220
Carnegie Potash Project (CPP) in Western Australia, which is located approximately 220
(2,200) 2,179,799
kilometres east-north-east of Wiluna. The CJO comprises one granted exploration licence and five
kilometres east-north-east of Wiluna. The CJO comprises one granted exploration licence and five
exploration licence applications, covering a total area of approximately 3,081 square kilometres.
exploration licence applications, covering a total area of approximately 3,081 square kilometres.
1,771,683
1,771,683
410,316
410,316
As announced to the market, the Scoping Study, Maiden Resource and Exploration Target
As announced to the market, the Scoping Study, Maiden Resource and Exploration Target
confirmed that the CPP has potential to be a technically and economically viable project, with an
confirmed that the CPP has potential to be a technically and economically viable project, with an
Inferred Resource of 0.88 Mt SOP @ 3,466 mg/l K (equivalent to 7,724 mg/l SOP) based only on
Inferred Resource of 0.88 Mt SOP @ 3,466 mg/l K (equivalent to 7,724 mg/l SOP) based only on
the top 1.7 metres of the 27,874 hectare surficial aquifer on granted tenement E38/2995 plus an
the top 1.7 metres of the 27,874 hectare surficial aquifer on granted tenement E38/2995 plus an
Exploration Target for material below the top 1.7 metres.
Exploration Target for material below the top 1.7 metres.
Variable interest
$
Fixed interest
$
Under the terms of the agreement BC Potash Pty Ltd can earn up to a 50% interest in the CJO by
Under the terms of the agreement BC Potash Pty Ltd can earn up to a 50% interest in the CJO by
predominantly sole-funding exploration and development expenditure across several stages.
predominantly sole-funding exploration and development expenditure across several stages.
Kalium Lakes Potash Pty Ltd is the manager of the CJO and will leverage its existing Intellectual
Kalium Lakes Potash Pty Ltd is the manager of the CJO and will leverage its existing Intellectual
Property to fast track work. The JO Companies have endorsed proceeding to a staged Pre-
Property to fast track work. The JO Companies have endorsed proceeding to a staged Pre-
Feasibility Study, with an initial focus on securing tenure and access to all required tenements.
Feasibility Study, with an initial focus on securing tenure and access to all required tenements.
4,157,744
4,157,744
1,592,744
1,592,744
3,513,542
3,513,542
4,549,047
4,549,047
2018
Financial assets
Cash and cash equivalents
Total
2017
Financial assets
Cash and cash equivalents
Total
30 June 2017
The Consolidated Entity has recognised its share of jointly held assets, liabilities, revenues and
The Consolidated Entity has recognised its share of jointly held assets, liabilities, revenues and
$
expenses of joint operations. These have been incorporated in the financial statements under the
expenses of joint operations. These have been incorporated in the financial statements under the
15,927
appropriate classifications. Information relating to joint operations that are material to the
appropriate classifications. Information relating to joint operations that are material to the
(15,927)
Consolidated Entity are set out below:
Consolidated Entity are set out below:
Impact on pre-tax profit
Interest rates + 1%
Interest rates – 1%
30 June 2018
$
41,577
(41,577)
Name
Name
Name
Carnegie Joint Operation
Carnegie Joint Operation
Carnegie Joint Operation
Country of Incorporation
Country of Incorporation
Country of Incorporation
Australia
Australia
Australia
% of Ownership Interest
% of Ownership Interest
% of Ownership Interest
30 June 2018 30 June 2017
30 June 2017
30 June 2018
30 June 2017
30 June 2018
85%*
85%*
85%*
85%*
85%*
85%*
* Kalium Lakes Pty Ltd ownership interest
* Kalium Lakes Pty Ltd ownership interest
As per Note 20, subsequent to the reporting date, BC Potash Pty Ltd earned an additional 15%
As per Note 20, subsequent to the reporting date, BC Potash Pty Ltd earned an additional 15%
interest into the Carnegie Joint Operation (CJO). As a result, BC Potash Pty Ltd post year end hold
interest into the Carnegie Joint Operation (CJO). As a result, BC Potash Pty Ltd post year end hold
a 30% interest in the CJO, with Kalium Lakes Potash Pty Ltd holding the remaining 70%.
a 30% interest in the CJO, with Kalium Lakes Potash Pty Ltd holding the remaining 70%.
Kalium Lakes Limited and Consolidated Entities
Kalium Lakes Limited and Consolidated Entities
47
47
79
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
DIRECTORS’ DECLARATION
DIRECTORS’ DECLARATION
The Directors of the Company declare that:
a.
b.
c.
the financial statements and notes are in accordance with the Corporations Act
2001;
comply with Accounting Standards;
are in accordance with International Financial Reporting Standards issued by the
International Accounting Standards Board, as stated in Note 1 to the financial
statements; and
d. give a true and fair view of the financial position as at 30 June 2018 and of the
performance for the year ended on that date of the Company and the
Consolidated Entity;
The Managing Director and Chief Financial Officer have each declared that:
a.
b.
c.
the financial records of the Company for the financial year have been properly
maintained in accordance with s 286 of the Corporations Act 2001;
the financial statements and notes for the financial year comply with the
Accounting Standards; and
the financial statements and notes for the financial year give a true and fair view;
In the Directors’ opinion there are reasonable grounds to believe that the Company will be able to
pay its debts as and when they become due and payable.
This declaration is signed in accordance with a resolution of the Board of Directors.
____________________
Brett Hazelden
Managing Director
10 September 2018
Kalium Lakes Limited and Consolidated Entities
48
80
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 INDEPENDENT AUDITOR’S REPORT
RSM Australia Partners
Level 32, Exchange Tower
2 The Esplanade Perth WA 6000
GPO Box R1253 Perth WA 6844
T +61 (0) 8 9261 9100
F +61 (0) 8 9261 9111
www.rsm.com.au
INDEPENDENT AUDITOR’S REPORT
To the Members of Kalium Lakes Limited
Opinion
We have audited the financial report of Kalium Lakes Limited (the Company) and its subsidiaries (the Group),
which comprises the consolidated statement of financial position as at 30 June 2018, the consolidated statement
of profit or loss and other comprehensive income, the consolidated statement of changes in equity and the
consolidated statement of cash flows for the year then ended, and notes to the financial statements, including a
summary of significant accounting policies, and the directors' declaration.
In our opinion the accompanying financial report of the Group is in accordance with the Corporations Act 2001,
including:
(i) Giving a true and fair view of the Group's financial position as at 30 June 2018 and of its financial
performance for the year then ended; and
CONTENT TO BE SUPPLIED
(ii) Complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those
standards are further described in the Auditor's responsibilities for the audit of the financial report section of our
report. We are independent of the Group in accordance with the auditor independence requirements of the
Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board's
APES 110 Code of Ethics for Professional Accountants (the Code) that are relevant to our audit of the financial
report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has been given to
the directors of the Company, would be in the same terms if given to the directors as at the time of this auditor's
report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
THE POWER OF BEING UNDERSTOOD
AUDIT | TAX | CONSULTING
RSM Australia Pty Ltd is a member of the RSM network and trades as RSM. RSM is the trading name used by the members of the RSM network. Each member of the RSM network is an independent
accounting and consulting firm which practices in its own right. The RSM network is not itself a separate legal entity in any jurisdiction.
RSM Australia Pty Ltd ACN 009 321 377 atf Birdanco Practice Trust ABN 65 319 382 479 trading as RSM
Liability limited by a scheme approved under Professional Standards Legislation
81
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 INDEPENDENT AUDITOR’S REPORT (CONTINUED)
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of
the financial report of the current period. These matters were addressed in the context of our audit of the financial
report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
Key audit matter
How our audit addressed this matter
Exploration and evaluation expenditure
As reported in the consolidated statement of profit or
loss and other comprehensive income, the Group
expensed total exploration and evaluation expenditure
of $10,589,212. This expenditure has been expensed
as incurred in accordance with AASB 6 Exploration for
and Evaluation of Mineral Resources and the Group’s
accounting policy.
Exploration and evaluation expenditure was
considered to be a key audit matter as it is material
and constituted 71% of the Group’s total expenses for
the year. The Group must also correctly classify the
expenditure in accordance with AASB 6. In addition,
the results of exploration and evaluation work
determines to what extent the mineral reserves and
resources may or may not be commercially viable for
extraction.
Our audit procedures in relation to exploration and
evaluation expenditure included:
Understanding how the expenditure is incurred
and agreeing a sample of the expenditure to
supporting documentation
the
expenditure has been properly authorised,
recorded in the correct period and appropriately
classified in accordance with AASB 6 and the
Group's accounting policy;
to ensure
Obtaining evidence that the Group has valid rights
to explore in each specific area for which the
expenditure is recorded;
Considering the Group’s assessment of the
commercial viability of
to
exploration and evaluation activities carried out in
each specific area; and
relating
results
Assessing the appropriateness of the Group’s
disclosures in the financial report.
Other information
The directors are responsible for the other information. The other information comprises the information included
in the Group's annual report for the year ended 30 June 2018, but does not include the financial report and the
auditor's report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not express any
form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information and, in doing
so, consider whether the other information is materially inconsistent with the financial report or our knowledge
obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of the directors for the financial report
The directors of the Company are responsible for the preparation of the financial report that gives a true and fair
view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal
control as the directors determine is necessary to enable the preparation of the financial report that gives a true
and fair view and is free from material misstatement, whether due to fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the Group to continue as
a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of
accounting unless the directors either intend to liquidate the Group or to cease operations, or have no realistic
alternative but to do so.
82
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 Auditor's responsibilities for the audit of the financial report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from
material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance
with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements
can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably
be expected to influence the economic decisions of users taken on the basis of this financial report.
A further description of our responsibilities for the audit of the financial report is located at the Auditing and
Assurance Standards Board website at: http://www.auasb.gov.au/auditors_responsibilities/ar2.pdf. This
description forms part of our auditor's report.
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in the directors' report for the year ended 30 June 2018.
In our opinion, the Remuneration Report of Kalium Lakes Limited, for the year ended 30 June 2018, complies with
section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the Remuneration Report
in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the
Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards.
D J WALL
Partner
RSM AUSTRALIA PARTNERS
Perth, Western Australia
11 September 2018
83
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018
ADDITIONAL INFORMATION
FOR PUBLIC LISTED COMPANIES (CONTINUED)
As at 30 June 2018
Issued Securities
Fully paid ordinary shares
$0.25 unlisted options expiring 16-Dec-19
$0.425 unlisted options expiring 29-Sep-20
$0.525 unlisted options expiring 19-Jan-20
$0.525 unlisted options expiring 17-May-21
Performance rights
Total
Quoted
on ASX
112,023,618
-
-
-
112,023,618
Unlisted
Total
57,769,847
9,000,000
330,882
843,936
1,000,000
20,000,000
88,944,665
169,793,465
9,000,000
330,882
843,936
1,000,000
20,000,000
200,968,283
Distribution of Listed Ordinary Fully Paid Shares
Number of Holders Number of Units % of Total Issued Capital
-%
-%
1%
10%
89%
100%
5,638
413,359
1,567,993
16,354,313
151,452,162
169,793,465
91
149
172
446
134
992
Spread of Holdings
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 - and over
Total
84
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 Top 20 Listed Ordinary Fully Paid Shareholders
Rank Shareholder
VINCE SMOOTHY SUPER PTY LTD
KUMARINA HOLDINGS PTY LTD
HAZELDEN CORPORATE PTY LTD
THOMAS CHUTE ELLIS + SALLY ANNE ELLIS
MR BRETT WILLIAM HAZELDEN + MS TANYA PHYLLIS
BOZIKOVIC
THOMAS ELLIS + SALLY ELLIS
UBS NOMINEES PTY LTD
CITICORP NOMINEES PTY LIMITED
COOLA STATION PTY LTD
PARKRANGE NOMINEES PTY LTD
MR DALE JAMES CHAMPION + MRS ANITA MARIA CHAMPION
P GOYDER SUPERANNUATION PTY LTD
MR STACEY RADFORD
NOWHERETOGO PTY LTD
MR DANIEL GEORGE CLARK + MISS JOHANNE GILLINGHAM
BIGA NOMINEES PTY LTD
BLUEBAY ASSET PTY LTD
NATIONAL NOMINEES LIMITED
MR EDWARD EARL MARSHALL
PATINA RESOURCES PTY LTD
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
Total
Shares
Held
% Issued
Capital
40,339,800
24%
15,865,283
6,629,414
6,232,493
5,854,797
5,000,000
4,374,001
3,774,928
3,315,600
2,933,553
2,837,325
2,715,854
2,247,966
2,157,800
2,150,443
2,014,068
1,881,500
1,878,720
1,385,854
1,352,600
114,941,999
9%
4%
4%
3%
3%
3%
2%
2%
2%
2%
2%
1%
1%
1%
1%
1%
1%
1%
1%
68%
85
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 NOTES
86
KALIUM LAKES LIMITED I CONSOLIDATED ANNUAL REPORT 2018 www.kaliumlakes.com.au
KALIUM LAKES LIMITED
Unit 1, 152 Balcatta Road
Balcatta WA 6021
PO Box 610
Balcatta WA 6914
Phone: +61 (0)8 9240 3200
info@kaliumlakes.com.au
www.kaliumlakes.com.au
ABN 98 613 656 643