Kin Mining NL
ABN 30 150 597 541
Annual Report
30 June 2020
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Kin Mining NL
CONTENTS
Corporate Information
Chairman’s Letter
Directors’ Report
Corporate Governance Statement
Auditor’s Independence Declaration
Consolidated Statement of Profit or 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 Securities Exchange Information
Tenement Table
Page
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6
40
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43
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69
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74
76
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Kin Mining NL
CORPORATE INFORMATION
ABN 30 150 597 541
Directors
Giuseppe (Joe) Paolo Graziano
Andrew Munckton
Brian Dawes
Hansjoerg Plaggemars
Nicholas Anderson
Company Secretary
Stephen Jones
Registered office
First Floor
342 Scarborough Beach Road
OSBORNE PARK WA 6017
Principal place of business
First Floor
342 Scarborough Beach Road
OSBORNE PARK WA 6017
Tel: (08) 9242 2227
Share register
Advanced Share Registry Services
PO Box 1156
NEDLANDS WA 6909
Tel: (08) 9389 8033
Solicitors
Dominion Legal
104 Edward Street
PERTH WA 6000
Auditors
HLB Mann Judd
Level 4, 130 Stirling Street
Perth WA 6000
Securities Exchange Listing
Kin Mining NL shares are listed on the Australian Securities
Exchange (ASX: KIN)
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Kin Mining NL
CHAIRMAN’S LETTER
Dear Shareholder,
I am pleased to report on what has been a busy, productive and successful year for Kin Mining.
The 2020 financial year marked the beginning of a new chapter for the Company as we embarked on a refreshed and
reinvigorated growth strategy at our flagship 100%-owned Cardinia Gold Project (CGP), located near Leonora in Western
Australia.
This new approach was based on a “back-to-basics” exploration-driven philosophy, aimed at making new discoveries and
delivering enhanced value by growing our gold inventory at a time of record strength in the gold price.
It is an approach which has won strong support during the year from both existing and new investors, as reflected both in the
Company’s success in raising capital during the year and in the substantial increase in our market capitalisation, which was
approaching $100 million at the time of finalising this report.
As I outlined in last year’s Annual Report, following the delivery of the updated Pre-Feasibility Study (PFS) for the CGP in
August 2019, the Company launched a multi-pronged campaign aimed at unlocking the broader mineralised potential of our
land-holding within the under-explored Minerie Greenstone Belt.
Part of this program included a review and re-optimisation of the existing CGP Resource based on improved geological
interpretation and modelling and utilising a consistent A$2,000 per ounce optimisation shell across all deposits to reflect the
cost parameters derived from the 2019 PFS.
This resulted in an updated Indicated and Inferred Mineral Resource estimate of 21 million tonnes grading 1.40g/t gold for
945,000oz of contained gold – an increase of 103,000 ounces over the previous estimate. Having a large, high quality gold
inventory in a Tier-1 mining jurisdiction like Leonora at a time of record Australian Dollar gold prices provides a strong
foundation for the Company’s growth strategy.
After viewing the project through an expanded lens, our exploration team adopted a project-wide, data-driven approach to
target new, higher-grade gold discoveries, with a priority focus on areas in close proximity to the proposed processing plant
site.
This strategy has delivered excellent results over the course of the year, with our exploration and drilling programs identifying
a suite of new prospect areas with the potential to add to our Resource base, while also highlighting areas with the potential
for company-changing discoveries. Chief amongst these are the newly-defined Cardinia Hill, Comedy King and Lewis East
targets, all of which offer exceptional growth potential.
Following successful first-pass exploration programs in FY2020, a major new drilling program commenced in late June 2020
with the aim of progressing our expansive pipeline of discovery and resource growth opportunities.
At the more advanced prospects (such as Cardinia Hill and Lewis East), our aim is to deliver maiden Mineral Resource
estimates by the end of this calendar year in conjunction with updated estimates for other selected deposits as part of a
project-wide Mineral Resource update.
In addition, our exploration programs have also identified a number of other exciting earlier-stage targets – including areas
such as Black Chief, Faye Marie, East Lynne and Pelsart – which will be progressively followed-up with further drilling over
the coming months.
Underpinned by our recent Rights Issue, which was strongly supported by shareholders, Kin Mining is fully funded to complete
the planned 45,000 metres of Reverse Circulation, diamond and air-core drilling by the end of 2020, ensuring a steady stream
of news for shareholders over the coming months.
While reflecting on the very positive results we’ve achieved over FY2020, we must also acknowledge the significant challenges
faced over the past six months as a result of the COVID-19 pandemic. I am pleased to report that the Company responded
quickly and efficiently to manage the potential spread of the virus, with no material impact on the Company’s activities to date.
The professionalism of our response to the COVID-19 situation reflects our broader commitment as a company to safeguard
the health and safety of our employees, contractors the communities where we operate. This is something we continue to
work hard to build into the fabric of our business, our day-to-day operations and the way we build and grow the organisation.
A strong and clearly defined approach to health and safety, corporate governance and responsible environmental
management is something we will continue to prioritise as we continue to mature as a company and make the transition from
explorer to developer and, ultimately, producer.
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Kin Mining NL
CHAIRMAN’S LETTER
Led by our Managing Director, Andrew Munckton, the Kin Mining team has delivered outstanding results over the course of
the year, and I would like to sincerely thank all of our staff and contractors for their dedication, hard work and commitment. I
would also like to acknowledge the contribution of my fellow Board members.
I believe we have made exceptional progress over the past 12 months to unlock the full potential of our assets, and the
Company is now well placed at a time of record strength in the Australian gold sector.
In closing, I would also like to thank you, our shareholders, for your strong ongoing support.
Yours sincerely,
Joe Graziano
Chairman
DIRECTORS’ REPORT
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The Directors of Kin Mining NL (“Kin” or “the Company”) submit herewith the consolidated annual financial report consisting
of the Company and its wholly owned subsidiaries (together the “Group”) for the financial year ended 30 June 2020. In
compliance with the provisions of the Corporations Act 2001, the Directors report as follows:
Directors
The names of the directors in office during or since the end of the year are as follows. Directors were in office for the entire
period unless otherwise stated.
Kin Mining NL
o Giuseppe (Joe) Paolo Graziano (Appointed Chairman 1 August 2019)
o Andrew Munckton
o Brian Dawes
o Hansjoerg Plaggemars (Appointed 31 July 2019)
o Nicholas Anderson (Appointed 31 July 2019)
Jeremy Kirkwood (Resigned 31 July 2019)
o
o Trevor John Dixon (Resigned 31 July 2019)
Mr Giuseppe (Joe) Paolo Graziano, Chairman
Mr Graziano is a Chartered Accountant with corporate and company secretarial experience. Mr Graziano has over 28 years’
experience providing a wide range of business, financial and strategic advice to small cap unlisted and listed public companies
and privately owned businesses in Western Australia’s resource-driven industries. Since 2014 he has been focused on
corporate advisory, company secretarial and strategic planning with listed corporations including Mergers & Acquisitions,
Capital Raisings, Corporate Governance, ASX compliance and structuring.
Mr Graziano is currently a director of Pathways Corporate Pty Ltd a specialised Corporate Advisory business and holds the
following Directorships in other Australian listed Companies:
- Thred Ltd – Non-Executive Director (ASX: THD)
- Migme Ltd – Non-Executive Director (ASX: MIG)
- Tyranna Resources Limited – Non-Executive Director (ASX: TYX)
Special Responsibilities:
- Nil
Directorships held in other Australian listed companies in the past 3 years:
- Castillo Copper Ltd – Non-Executive Director appointed 13 August 2015 and ceased 1 August 2017
Kin Mining NL
DIRECTORS’ REPORT
Mr Andrew Munckton, Managing Director
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Mr Munckton is an experienced geologist who has held senior management roles of both ASX-listed companies and gold
operations in a career spanning more than 30 years.
Mr Munckton has previously held the roles of Managing Director of Syndicated Metals Limited and Avalon Minerals, General
Manager – Operations for Gindalbie Metals, General Manager Strategic Development of Placer Dome Asia Pacific and
General Manager Operations of the Kanowna Belle, Paddington and Kundana gold mines over a period of 10 years.
He holds a Bachelor of Science (Geology) from the University of Western Australia and is currently a Member of the
Australasian Institute of Mining and Metallurgy (AusIMM) and the Australian Institute of Company Directors.
Special Responsibilities:
- Nil
Directorships held in other Australian listed companies in the past 3 years:
- Syndicated Metals Limited – Managing Director, resigned 26 April 2018
Mr Brian Dawes, Non-Executive Director
Mr Dawes is a mining engineer with extensive international mining industry experience. He holds a BSc in Mining from the
University of Leeds UK, and is Member of the Australasian Institute of Mining and Metallurgy.
He has worked in the UK, Africa, the Middle East and across Australia and holds several First Class Mine Managers’
Certificates of Competency. Mr Dawes’s diverse expertise covers all key industry aspects from exploration through the
discovery, feasibility, funding, approvals, project construction, commissioning, operations, optimisation, logistics, marketing,
and closure phases. This includes site management and corporate responsibilities in a diversity of challenging and successful
underground and open pit operations across many commodities and geographies; mainly in copper, nickel, gold, zinc and
lead, with iron ore, graphite, and coal.
Mr Dawes is a Non-Executive Director of Talisman Mining, and has previously held a number of Executive positions with
Jubilee Mines NL, Western Areas, LionOre Australia, WMC, Normandy Mining and Aberfoyle.
Special Responsibilities:
- Nil
Directorships held in other Australian listed companies in the past 3 years:
- Talisman Mining Ltd – Non-Executive Director appointed 17 June 2009
Mr Hansjoerg Plaggemars, Non-Executive Director (appointed 31 July 2019)
Mr Plaggemars is an experienced company director with a deep background in corporate finance, corporate strategy and
governance. He has served on the Board of Directors of many listed and unlisted companies in a variety of industries including
mining, agriculture, shipping, construction and investments. This includes the Board of Delphi Unternehmensberatung AG.
Mr Plaggemars has qualifications in Business Administration and is fluent in English and German.
Special Responsibilities:
- Nil
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Kin Mining NL
Expedeon AG – Non-Executive Supervisory Board Member
DIRECTORS’ REPORT
Directorships held in other public Companies
-
- Ming Le Sports AG, Heidelberg - Executive Board Member (Vorstand)
- Decheng Technology AG, Cologne - Executive Board Member (Vorstand)
-
-
- MARNA Beteiligungen AG, Heidelberg - Executive Board Member (Vorstand)
-
Youbisheng Green Paper AG, Heidelberg - Executive Board Member (Vorstand)
Snowbird AG, Cologne - Executive Board Member (Vorstand)
S&O Agrar AG, Leipzig - Executive Board Member (Vorstand)
Directorships held in other non-public Companies
- Nordic SSW 1000 Verwaltungs AG, Hamburg - Non-Executive Supervisory Board Chairman
- Carus AG, Heidelberg - Non-Executive Supervisory Board Member
- Deutsche Balaton Immobilien I AG, Heidelberg - Non-Executive Supervisory Board Member
-
-
-
- OOC CTV Verwaltungs GmbH, Hamburg - Executive Managing Director (Geschäftsführer)
-
Alpha Cleantec AG, Heidelberg - Executive Board Member (Vorstand)
Balaton Agro Invest AG, Heidelberg - Executive Board Member (Vorstand)
Strawtec Group AG, Heidelberg - Executive Board Member (Vorstand)
Value Consult, Consultancy, Stuttgart, Owner
Mr Nicholas Anderson, Non-Executive Director (appointed 31 July 2019)
Mr Anderson is a finance executive with extensive experience in the resource sector. As a trained chemical engineer with
combined knowledge of bulk commodities and strong financial acumen he provides financial and corporate advisory
services to several mining companies. He has a successful track record in capital raisings, restructures and executing
highly complex transactions across private and public markets.
Mr Anderson is currently Chief Financial Officer of Rivet Group which provides transport, logistics, equipment hire and
maintenance services to a number of industries, predominately mining. Mr Anderson is also a Non-Executive Director of
Adaman Resources and is a graduate of the Australian Institute of Company Directors.
Special Responsibilities:
- Nil
Directorships held in other Australian listed companies in the past 3 years:
- Nil
Mr Jeremy David Kirkwood, Chairman (resigned 31 July 2019)
Mr Kirkwood has extensive experience in corporate strategy, investment banking and global capital markets and provides
strategic leadership and guidance to the Company’s board and management team.
Mr Kirkwood is a principal of Pilot Advisory Group and was previously a Managing Director at Credit Suisse, Morgan Stanley
and Austock. He has primarily worked in public markets, undertaking merger and acquisitions and capital raisings for
companies principally in the metals and mining, energy and infrastructure sectors.
Mr Kirkwood is currently a Non-Executive Director of Talisman Mining and previously served as a Director of ASX listed
Zenitas Ltd (formerly BGD Corporation). He is also the Chair of Geelong Grammar School and a Director of Independent
Schools Victoria.
Special Responsibilities:
- Nil
Directorships held in other Australian listed companies in the past 3 years:
-
Talisman Mining – Non-Executive Director, appointed 1 April 2016
Kin Mining NL
DIRECTORS’ REPORT
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Mr Trevor John Dixon, Executive Director (resigned 31 July 2019)
Mr Dixon is a businessman with more than 30 years of experience in the mining and exploration sector in Western Australia.
Starting out as an earthmoving contractor to the industry, Mr Dixon developed a strong interest in mining and the identification
of prospective mineral areas and acquisition of project areas of interest. He was a founding vendor to a number of companies
including Jubilee Mines NL (Glencore PLC), Terrain Minerals Ltd (ASX: TMX) and Nzuri Copper Ltd (ASX: NZC), Kin Mining
NL (ASX: KIN) and Torian (ASX: TNR).
During his time in the industry, he has had joint venture partners including Newcrest Mining Ltd, Independence Group NL, St
Barbara Ltd, Normandy Poseidon, Ashton Mining, Regal Resources Ltd, Glencore PLC and currently holds Joint
Venture/Royalty agreements with Stone Resources Limited, Kin Mining NL, Torian and Syndicated Metals.
Mr Dixon’s management experience spans the areas of contractual outcomes, Mining Act regulatory procedures and
standards, tenement management and a long history of Native Title negotiations and resolutions.
Special Responsibilities:
- Nil
Directorships held in other Australian listed companies in the past 3 years:
- Nil
Company Secretary
Mr Stephen Jones, Company Secretary and Chief Financial Officer
Mr Jones is a Chartered Accountant with more than 25 years’ experience leading corporate finance and governance teams
in Australia and overseas. With the last 20+ years in the Western Australian mining industry Mr Jones has a demonstrated
history in Mineral Exploration, Investor Relations, Analytical Skills, Feasibility Studies, and Environmental Awareness
previously holding senior Finance positions at Portman Mining, Aviva, Southern Cross Goldfields and Middle Island
Resources.
Interests in the shares and options of the Company.
The following relevant interests in shares and options of the Company were held by the directors as at the date of this report:
Fully paid ordinary shares
Number
10,000,000
1,639,057
617,419
171,428
742,856
Share options
Number
5,000,000
-
-
-
-
Directors
G Graziano
B Dawes
A Munckton
H Plaggemars
N Anderson
Principal Activities
The principal activities of the Group during the year were gold and base metals exploration and gold project development.
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Kin Mining NL
DIRECTORS’ REPORT
OPERATIONS REPORT
Kin Mining NL’s (“Kin” or the “Company”) key asset is its 100%-owned Cardinia Gold Project (“CGP” or the “Project”), located
approximately 30km north-east of Leonora and approximately 250km north-northwest of Kalgoorlie in Western Australia. The
CGP is situated in the heart of an active gold mining district that hosts several multi-million-ounce operating gold mines
including Sons of Gwalia, Wallaby, Sunrise Dam, Mt Morgans, Thunderbox and Darlot (Figure 1).
The district is well serviced by infrastructure including a network of high-quality roads, gas pipelines, communication
infrastructure, airstrips with regular services to Perth and close proximity to an established mining workforce and supply
network.
Figure 1. The Cardinia Gold Project and surrounding deposits and gold mining operations.
RESPONSE TO COVID-19
Kin implemented a number of procedures in response to the onset of the COVID-19 pandemic during the year to ensure the
health and safety of all staff and contractors and to play our part in reducing the risk of transmission while still maintaining an
effective and productive workforce to undertake our activities.
This includes measures designed to support social distancing including having the majority of Perth-office staff working from
home, minimising interaction on site and restricting all non-essential travel by staff and contractors.
Drilling and exploration activities were able to continue throughout the reporting period, with no material impact from COVID-
19 on the Company’s operations.
The Company will continue to monitor the incidence of COVID-19 and will implement additional protocols and procedures as
required to ensure the health and safety of our team and local communities.
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Kin Mining NL
DIRECTORS’ REPORT
PRE-FEASIBILITY STUDY
The Company delivered a Pre-Feasibility Study (PFS) for the CGP in August 2019. The PFS was completed with a high
degree of rigour and demonstrated that the Project is both technically sound and capable of producing solid cash flow with
significant leverage to the Australian dollar gold price.
Table 1 summarises the key CGP 2019 PFS parameters which include Ore Reserves, the proportion of Inferred Mineral
Resource used in the Mine Plan, capital costs, production summary and project financials.
Table 1. Key Project Parameters
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Kin Mining NL
DIRECTORS’ REPORT
PROJECT ECONOMICS
Base Case gold price (A$)
$2,000/oz
$2,200/oz
$2,500/oz
Exchange Rate (US$:A$)
0.70
0.70
0.70
Life of Mine Revenue (A$)
$736.2M
$809.8M
$920.2M
C1 Cash Costs 2
$1,284/oz
$1,284/oz
$1,284/oz
Adjusted Operating Costs 3
$1,349/oz
$1,355/oz
$1,364/oz
All-In-Sustaining Costs 4
$1,442/oz
$1,448/oz
1,457/oz
Pre-Tax Operating Cash Surplus
$128.4M
$199.8M
$306.9M
Net Present Value (NPV8%)
$66.8M
$118.0M
$194.8M
Internal Rate of Return (IRR)
17%
29%
45.3%
1 Cut-off grade 0.5 g/t Au
2 C1 Cash Costs (C1) includes all mining, surface haulage, processing, refining, by-product credits and onsite overhead costs
3 Adjusted Operating Costs (AOC) includes C1 costs plus royalties
4 All-In-Sustaining Costs (AISC) includes AOC plus closure costs and sustaining capital, but excludes head office corporate
costs and Tax
Totals may vary due to rounding
Following completion of the PFS, Kin Mining embarked on an exploration strategy aimed at identifying new, higher grade ore
sources of ore to materially improve forecast returns and surplus cash-flow by displacing lower margin ore trucked from
Mertondale to Cardinia with higher value processing plant feed.
MINERAL RESOURCE UPDATE
During the year, Kin completed an update to the Mineral Resource estimate for the CGP. The upgrade included new estimates
for Mineral Resources completed by previous asset owners and brings all of Kin’s mineral inventory to the same high standard
for modelled estimates. Refer to the Company’s ASX announcement 17 February 2020 (Table 2).
DIRECTORS’ REPORT
Table 2: CGP Mineral Resource Estimate, February 2020
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Kin Mining NL
Mineral Resources estimated by Jamie Logan of Kin Mining NL, and reported in accordance with JORC 2012 using a 0.5g/t
Au cut-off within A$2,000 optimisation shells
The February 2020 Mineral Resource estimate has been reported for the Fiona, Rangoon, Hobby, Mertondale 5, Eclipse,
Quicksilver, Leonardo, Michelangelo, Forgotten Four and Krang deposits.
All Mineral Resource estimates are reported within optimised shells using the same stringent criteria and a conservative gold
price assumption of A$2,000/oz. Material changes compared to the previous (July 2019) Mineral Resource relate to:
Improved geological interpretation and modelling at Fiona and Rangoon;
Improved modelling and estimation techniques at the Raeside Area deposits; and
Inclusion for the first time of an estimate of the Hobby deposit.
Full details of the February 2020 Mineral Resource Estimate are provided in Kin Mining’s ASX Announcement dated 17
February 2020.
EXPLORATION
Following the completion of the PFS outlined above, Kin Mining commenced the evaluation of exploration opportunities across
its tenement package and its consolidation and strategic options within the region. Kin has a dominant 502km2 land-holding
across the under-explored Minerie Greenstone Belt. The region has yielded multiple gold deposits in recent decades. The
CGP area encompasses +45km strike of the entire Minerie Formation sequence which contains large alteration systems
related to gold mineralisation (Figure 2).
DIRECTORS’ REPORT
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Kin Mining NL
Figure 2. The Minerie Greenstone Belt tenure of the CGP over regional magnetics.
Exploration over the past decade has focused on areas around the known deposits, principally Mertondale and Bruno Lewis,
limited by a strategy of seeking to “feed the mill” with shallow drilling and no detailed understanding of the gold mineralised
system.
Exploration Strategy
A program of target generation undertaken since the middle of 2019 – informed by a new project-wide, data-driven, “bottom-
up” analysis of the mineralised system at Cardinia – has resulted in the identification of a number of new target areas, which
were ranked and prioritised for drill testing. Large alteration systems related to gold mineralisation have been identified
throughout the area.
Exploration completed in late 2019 and early 2020 has focused on areas within 5km of the proposed CGP plant site. Over
60% of Kin’s tenure is overlain by recent transported cover and has seen little previous modern exploration – with shallow
alluvial and sheet-wash concealing potential deposits (Figure 3).
Using new, high-quality assay methods, Kin has collected and analysed over 4,200 auger samples across Cardinia and a
further 1,448 auger samples at the Iron King prospect during the year. A new, aerial magnetic survey was also completed
over the eastern portion of Cardinia, completing the Minerie sequence at Cardinia with high-resolution magnetics and 1:10,000
scale mapping. These two datasets coupled with the improved geological maps are key to understanding the geology and
delineating new targets.
DIRECTORS’ REPORT
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Kin Mining NL
Figures 3 and 4. The Minerie Greenstone Belt, Cardinia structures and stratigraphy.
The Cardinia area contains an extensive sulphide mineralised system characterised by substantial high-grade gold zones
within broader zones of alteration containing lower-grade material. Gold mineralisation in the area has a strong association
with Silver (Ag), Arsenic (As), Antimony (Sb), Bismuth (Bi), Copper (Cu), Tellurium (Te), Tungsten (W) and Zinc (Zn).
The north-east trending fault system across the Cardinia area is interpreted to have mineralised the stratigraphy early in the
Minerie Greenstone Belt history.
Cardinia is unusual in the Yilgarn in that the mineralisation is characterized by shallow crustal features generally considered
to be less than 3km deep. The north-east trending faults are the fluid and metal conduit from the older rocks of the Welcome
Well formation to the north-east, to the younger rocks and the Keith-Kilkenny Fault to the south-west.
Cross-cutting veins and shears and stratigraphic contacts are structural traps for sulphide accumulation separate to the north-
east trending faults (Figure 4), making the intersection of these regional features highly prospective targets for significant new
discoveries.
DIRECTORS’ REPORT
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Kin Mining NL
Figure 5. Cardinia Gold Project, key targets.
Cardinia Hill
The Cardinia Hill prospect, located just 2.5km east of the proposed processing plant site, featured a single line of historical
RAB drilling with attractive grades, including 7m @ 6g/t Au associated with sheared, sulphide-rich sediments and cherts.
Kin Mining completed 24 AC holes in December 2019, with significant results including:
24m at 1.64g/t Au from 32m to bottom of hole (BOH) (CH19AC018)
20m at 1.42g/t Au from 8m to 28m (CH19AC019)
12m at 1.31g/t Au from 24m to BOH (CH19AC010)
Results from 1m split samples of these holes confirmed the thickness and overall grade of the original composite assays, with
highlights from the 1m splits including:
9m at 3.05g/t Au from 46m including 1m at 11.7g/t from 51m (CH19AC018)
8m at 2.17g/t Au from 19m including 1m at 7.80g/t from 19m (CH19AC019)
6m at 1.87g/t Au from 29m (CH19AC010)
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DIRECTORS’ REPORT
The improved definition available from the 1m split samples highlighted several higher grade gold mineralised zones within
the broader mineralised envelope defined by the original 4m composite assays.
Subsequent Phase 2 RC drilling in April and May 2020 comprised 17 holes for 1,878 metres, which returned consistent high-
grade, near-surface gold mineralisation, successfully extending the mineralisation along strike and confirming the presence
of depth extensions of the mineralisation encountered in the previous AC drilling. Key highlights included:
Kin Mining NL
5m at 3.06g/t Au from 53m and 7m at 1.83g/t Au from 94m (CH20RC027)
17m at 3.29g/t Au from 10m (CH20RC028)
15m at 4.42g/t Au from 34m (CH20RC030)
8m at 3.81g/t Au from 4m (CH20RC035)
4m at 5.15g/t Au from 32m and 6m at 1.92 g/t Au from 66m (CH20RC037)
8m at 2.38g/t Au from 18m and 9m @ 2.31g/t Au from 56m (CH20RC038)
9m at 1.72g/t Au from 42m (CH20RC040)
CH20RC025 returned intercepts of 5m @ 1.21g/t from 13m and 7m @ 2.44g/t from 117m, highlighting the presence of several
lodes within the mineralised corridor.
Lower grade results were returned from CH20RC031 (4m @ 0.86g/t from 14m) and CH20RC032 (1m @ 1.07g/t from 81m).
Hole CH20RC031 confirms the continuity of mineralisation between drilling in the southern end of the prospect and the
interpreted northern continuation of the deposit intersected in hole HE20AC221.
Hole CH20RC035, which was designed to drill up-dip of the intercept in CH20RC030, returned an intercept of 8m @ 3.81g/t
from 4m, confirming the continuation of the mineralisation to the surface.
Holes CH20R038 and CH20RC037 were designed to test a section of inconsistent historical drilling in the centre of the
deposit. Results from these holes have defined three distinct mineralised lodes, with intercepts of 8m at 2.38g/t from 18m and
9m at 2.31g/t from 56m in CH20RC038, and 4m at 5.15g/t from 32m, 6m @ 1.92g/t from 66m and 5m @ 1.69g/t from 128m
in CH20RC037.
The northern-most holes (CH20RC040 and CH20RC041) were designed to test beneath a significant intercept in the Helens
East air-core program (HE20AC221, which returned 33m @ 1.08g/t (see below).
Assays from these holes returned an intercept of 9m @ 1.72g/t from 42m in CH20RC040, 20m down-dip of the air-core
intercept. A further intercept of 2m @ 2.91g/t from 25m was returned in CH20RC041, located 40m to the south. Further drilling
is planned to step out from these results and define the extent of this area of the deposit.
DIRECTORS’ REPORT
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Kin Mining NL
Figure 6. Cardinia Hill Prospect, RC drilling results.
These results confirm the presence of mineralisation at the Cardinia Hill prospect for over 500m of strike.
Multi-element assays of mineralised intervals displayed a significant enrichment in silver (Ag), arsenic (As), molybdenum
(Mo), antimony (Sb), tellurium (Te), and tungsten (W) all associated with sulphide mineralisation.
Phase 3 drilling resumed at Cardinia Hill in June, with initial assay results received for the first 11 Reverse Circulation drill
holes in July. The Cardinia Hill RC program was designed to commence in-fill drilling to 40m x 40m spacing at the southern
end of the deposit and to step out and test for potential strike and depth extensions in the northern end of the deposit.
The results have extended the mineralisation to the north with the definition of two higher-grade north-plunging shoots.
Highlights from the latest batch of assay results included:
o
o
o
o
o
o
o
17m at 2.35g/t Au from 6m including 5m at 5.2g/t Au (CH20RC042)
4m at 3.89g/t Au from 57m (CH20RC051)
4m at 1.21g/t Au from 6m (CH20RC044)
6m at 1.27g/t Au from 33m (CH20RC046)
5m at 1.09g/t Au from 30m (CH20RC045)
2m @ 3.28m from 40m and 2m @ 3.17g/t from 160m (CH20RC048)
5m at 1.17g/t Au from 51m and 1m at 2.05g/t Au from 68m (CH20RC049)
In-fill drilling at the southern end produced intercepts of 17m @ 2.35g/t from 6m (CH20RC042) confirming the tenor of the
mineralisation originally encountered in this part of the deposit. The deeper RC holes in this area typically intersected narrower
mineralised zones (2m @ 3.17g/t from 160m in CH20RC048) and confirmed the continuity of the mineralised structures at
depth.
At the northern end of the deposit, intersections including 4m @ 3.89g/t from 57m (CH20RC051) have extended the strike
length of the deposit to the north.
New detailed airborne magnetic data acquired recently by Kin Mining has, for the first time, been integrated into the
interpretation of the mineralisation being encountered in the Cardinia area.
Kin Mining NL
DIRECTORS’ REPORT
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As drilling progresses at Cardinia Hill, it is becoming apparent that, within the main lode, two north-plunging high-grade shoots
are present within a generally lower grade halo of mineralisation. Both of these shoots feature a coincident magnetic anomaly.
The Cardinia Hill magnetic anomalies reveal open positions to the north and south as well as down-dip to the west. These
positions will be tested as part of the upcoming systematic resource drill-out.
A number of other significant magnetic anomalies have also been revealed from the new magnetic data in the areas
surrounding Cardinia Hill, which coincide with the mineralisation intersected in recent air-core drilling at Helens East and
Helens South. Additional magnetic anomalies are present in areas untested by drilling which warrant follow-up exploration.
The next phase of drilling at Cardinia Hill will target the strike and down-plunge extent of the high-grade shoots, continue to
in-fill areas of broad-spaced drilling within the deposit to 40m by 40m spacing and test some of the magnetic anomalies.
The follow-up drilling program will also include a number of diamond drill holes to improve the understanding of the structural
relationships in detail and provide initial metallurgical testwork samples for the deposit.
Full details of the Cardinia Hill drilling results were provided in the Company’s ASX Announcements dated 13 January, 18
February, 27 April, 18 May, 3 June 2020 and 24 July 2020.
Comedy King
The Comedy King prospect hosts historical drill intercepts of 1m at 40g/t and 2m at 10.1g/t gold produced from RC holes
drilled towards the east.
Rock chip sampling results of 895g/t and 277g/t and mapping undertaken during the reporting period indicates that most of
the historical workings exploited quartz veins dipping moderately to the north.
The December 2019 drilling program comprised four lines of air-core drilling for 4,144m oriented to intersect the north dipping
veins. The prospect is centred on the north-east oriented Lewis Fault which is the focus of gold mineralisation further south
at both the Lewis and Lewis East prospects. The Comedy King prospect is also cut by an east-west trending Proterozoic
dolerite dyke which post-dates mineralisation.
In the north of the prospect, drilling intersected a number of discrete quartz veins with attendant sulphide mineralisation hosted
in Felsic Volcanic rocks. The veins are interpreted to be initiated by the Lewis Fault zone. The veins showed strong gold
mineralisation with occasional bonanza grades, generally over 4 metre composite assays.
Vein style results include:
4m at 8.3g/t Au from 20m to EOH (CK19AC037)
4m at 1.7g/t Au from 4m (CK19AC040)
12m at 14.9g/t Au from 4m including 8m at 21.9g/t from 8m (CK19AC070)
4m at 1.7g/t Au from 4m (CK19AC123)
In the south of the prospect, where previous drilling had targeted historical workings, AC drilling intersected broad areas of
disseminated sulphide alteration with fine quartz veining. On the three lines of AC drilling that tested this area each line
intersected alteration in a number of adjacent drill holes.
The alteration halo is characterised by disseminated sulphide mineralisation and fine veining in Felsic Volcanic rocks. More
substantive quartz veins are also present. The alteration halo appears to be oriented north west-south east and dip to the
north east. The alteration halo also appears to be spatially coincident with the interpreted position of the Lewis Fault zone.
Alteration Halo results include:
12m at 1.23g/t Au from 28m (CK19AC055)
8m at 3.0g/t Au from 8m (CK19AC056)
8m at 1.8g/t Au from 0m (CK19AC105)
20m at 2.3g/t Au from 0m (CK19AC113)
12m at 2.7g/t Au from 4m (CK19AC114)
8m at 1.43Au from (CK19AC115)
The alteration halo mineralisation is approximately 100m wide in the western line as intersected in CK19AC052 to
CK19AC056 and remains open to the south, to the west and down dip. The alteration halo mineralisation is approximately
150m wide in the eastern line as intersected in CK19AC105 to CK19AC115 and remains open to the east and down dip.
-20-
DIRECTORS’ REPORT
The geological features of high-grade epithermal veining and sulphide alteration over significant widths associated with a
proven fertile shear zone centred on the Lewis Fault are indicative of a large mineralised system operating at Comedy King.
Subsequent 1m split samples of the drill core from Comedy King confirmed the thickness and overall grade of the original
composite assays outlined above. The improved definition available from the 1m split samples highlighted several higher-
grade gold mineralised zones associated with north dipping quartz veining within the broader mineralised envelope defined
by the original 4m composite assays.
Kin Mining NL
Highlights from the 1m splits include:
3m at 12.1g/t Au from 21m to end-of-hole including 2m at 17.1g/t from 21m (CK19AC037)
6m at 2.25g/t Au from 28m (CK19AC055)
8m at 2.04g/t Au from 7m (CK19AC070)
3m at 5.45g/t Au from 5m, including 1m at 11.1g/t from 6m (CK19AC113)
2m at 6.70g/t Au from 5m, including 1m @ 12.2g/t from 5m (CK19AC114)
2m at 5.88g/t Au from 3m (CK19AC105)
Following analysis of the AC results, a total of 19 RC drill-holes were undertaken at Comedy King for 1,803m. These targeted
north-dipping veins initially identified in a surface sampling campaign, and later intersected in AC drilling.
Results including 2m @ 8.1g/t from 37m (CK20RC142) clearly highlight the presence of high-grade gold associated with east-
west oriented quartz veins. Gold in these veins is likely to be nuggetty, with a majority of the holes intersecting significant
albite-sericite-carbonate-pyrite alteration within the felsic host rocks, associated with generally lower grade gold
mineralisation.
In addition, a further 104 AC holes were completed, totalling 4,224m. This drilling was designed to extend the coverage over
NE-trending faults, interpreted to be the controlling structures for the mineralisation.
Extremely high-grade gold was intersected at surface, most notably in drill-hole CK20AC193, which delivered an intercept of
4m @ 113g/t from surface. As more drilling data from the prospect is generated, a clear NW-SE trend is becoming apparent
in the alteration and gold mineralisation, with two zones at Comedy King following this trend.
The two NE-SW trending zones contain both the majority of the east-west oriented high grade veins and the broader envelope
of alteration intersected in the five lines of air-core drilling. Each of these zones illustrated in Figure 7, measures approximately
500m strike length by 100m width and form a significant exploration target in their own right.
DIRECTORS’ REPORT
-21-
Kin Mining NL
Figure 7. Comedy King Prospect, drilling results.
The NW-SE orientation aligns with the multi-element geochemical data which suggests a strong sericite-pyrite alteration halo
in this orientation. A more complex picture of the mineralisation is emerging, one in which the north-dipping high-grade veins
are just one component in a larger mineralised system controlled by the NESW trending faults.
Further interpretation is required to fully understand the geology of the prospect. This process, assisted by detailed
geochemistry and geophysical data is underway.
Full details of the Comedy King drilling results were provided in the Company’s ASX Announcement dated 3 February, 11
March, 26 March and 27 May 2020.
A program of RC Resource definition drilling will be undertaken at Comedy King in the first half of FY2021.
Lewis East
The Lewis East prospect is highlighted by a 1.4km-long surface gold anomaly, defined by shallow (2-3m) historic RAB and
vacuum drilling. It is situated just 1km from the proposed Cardinia processing plant and 300m to the east of the proposed
Lewis Pit.
Aircore drilling during FY2020 consisted of a number of lines with drilling oriented to target the northeast-dipping lodes
observed in the nearby Lewis Trial pit. A total of 47 holes were completed, with highlights including:
4m at 11.6g/t Au from 8m (LE19AC012)
53m at 1.27g/t Au from 4m to bottom of hole (BOH) (LE19AC007)
13m at 1.03g/t Au from 24m to BOH (LE19AC009)
28m at 0.67g/t Au from 8m (LE19AC034)
32m at 1.10g/t Au from 0m (LE19AC036)
DIRECTORS’ REPORT
7m at 1.53g/t Au from 28m to BOH (LE19AC039)
16m at 1.33g/t Au from 8m (LE19AC044)
-22-
Results from the 1m split samples at Lewis East confirmed the thickness and overall grade of the original composite assays.
The improved definition available from the 1m split samples highlighted several higher-grade gold mineralised zones within
the broader mineralised envelope defined by the original 4m composite assays as shown in Figure 8.
Kin Mining NL
Highlights from the 1m splits included:
11m at 5.28g/t Au from 20m including 4m at 12.4g/t from 26m (LE19AC007)
8m at 2.04g/t Au from 27m (LE19AC009)
1m at 33.8g/t Au from 10m (LE19AC012)
11m at 3.85g/t Au from 24m, including 8m at 5.00g/t from 24m (LE19AC036)
6m at 3.63g/t Au from 9m, including 2m at 9.27g/t from 10m (LE19AC044)
19m at 1.04g/t Au from 14m, including 5m at 2.28g/t from 26m (LE19AC034)
Follow-up RC drilling confirmed the presence of broad zones of gold mineralisation associated with disseminated sulphides.
However, while geologically consistent zones containing strong alteration and sulphide mineralisation were intersected in the
expected position at depth, these broad sulphide-rich zones contain mostly low-grade gold mineralisation with intercepts
including 44m @ 0.47g/t from 51m (LE20RC057) and 11m @ 0.62g/t from 53m (LE20RC048), below strong near-surface
mineralisation.
Figure 8. Lewis East Prospect, drilling results.
Kin Mining NL
-23-
DIRECTORS’ REPORT
The Lewis East style of mineralisation is interpreted to be hosted in NE-dipping disseminated sulphide zones, comparable to
those previously defined at Bruno and Lewis. The zones are spatially associated with NE-trending faults. These NE-dipping
structures are important fluid pathways controlling the distribution of mineralisation in the wider Cardinia area.
Full details of the Lewis East drilling results were provided in the Company’s ASX Announcements dated 13 January, 7
February, 11 March, 2 April and 9 June 2020.
Additional drilling will be undertaken at Lewis East in the first half of FY2021.
Black Chief
The FY2020 program consisted of two AC lines to test below rock chip samples that mark the southern continuation of the
Black Chief mineralisation.
A total of 12 holes for 649m of AC drilling was completed, with one significant intersection returned:
4m at 2.16g/t Au from 20m to 24m in BC19AC004
Assays from the 1m split samples of the Black Chief air-core program produced intercepts of 3m at 3.47g/t Au from 47m and
3m at 2.55g/t from 18m.
These intercepts are hosted with a ferruginous sediment with significant quartz veining. The geological setting is comparable
to the mineralisation at the Black Chief workings located approximately 300m to the north. The mineralisation intersected in
the AC drilling is interpreted to represent the southern continuation of this mineralisation.
Further drilling is planned to the north and south to assess the extent of the mineralisation and its relationship to the main
Black Chief surface workings.
Full details of the Black Chief exploration results were provided in the Company’s ASX Announcements dated 13 January
and 18 February 2020.
Faye Marie
A 64-hole AC drilling program was completed at the Faye Marie prospect, located to the east of Comedy King and directly
along strike from Black Chief.
This drilling, totalling 2,410m, targeted a mafic-felsic contact associated with significant gold anomalism identified in auger
drilling, gold-in-soil geochemical sampling and historical RC drilling at Black Chief.
Mineralisation appears to be higher grade where north-east-trending faults intersect the contact. The results confirmed the
presence of mineralisation on the contact, producing an intercept of 8m @ 3.01g/t from 36m (FM20AC019). A re-interpretation
of the area, based on a litho-geochemical analysis of the multi-element dataset, suggests this mineralisation may be the
along-strike equivalent of the Black Chief deposit to the south.
An assay result of 4m @ 2.99g/t from 48m was also returned in FM20AC058. This intercept lies in the hanging-wall (west) of
the lithological contact, within the felsic unit approximately 1.0km north.
The Faye Marie AC results confirm the prospectivity of this contact which stretches over a 3km strike length between Faye
Marie and Black Chief.
Further interpretation is underway, along with planning of follow-up programs. Full details of the Faye Marie drilling results
were provided in the Company’s ASX Announcements dated 27 May and 9 June 2020.
Helens East
The Helens East AC program comprised a total of 4,252m of drilling targeting several Chert and Felsic Volcanic horizons that
showed alteration and sulphide weathering textures located between the Helens deposit and the emerging Cardinia Hill
prospect. The AC drilling also tested the potential northern extensions of the Cardinia Hill trend.
Three drill lines were completed with drilling designed to test to the top of fresh rock. The weathering profile is relatively
shallow, with the area consisting predominantly of sub-cropping lithology. Drill lines were spaced every 200m along strike and
covered an area approximately 1,000m wide by 600m long. Sampling was completed as 4 metre composite assays.
Intersections from 4m composite sampling from the first three lines include:
6m at 2.05g/t Au from 28m (HE20AC140)
12m at 1.06g/t Au from 0m (HE20AC191)
33m at 1.08g/t Au from 0m (HE20AC221)
-24-
DIRECTORS’ REPORT
Of significance were the intersections in HE20AC140 (6m at 2.05g/t Au from 28m to bottom-of-hole) and HE20AC191 (12m
at 1.06g/t Au from surface) which indicate a zone of mineralisation associated with a pyritic Chert unit trending south from the
Helens deposit as illustrated in Figure 9.
Also of significance, is the intersection in HE20AC221 (33m at 1.08g/t Au from surface to bottom-of-hole), which is interpreted
as the northern extension of the Cardinia Hill mineralisation intersected in RC drilling further south east (see Cardinia Hill RC
results outlined above).
Kin Mining NL
Figure 9. Helens East Prospect, drilling results.
Intercepts of 3m @ 0.59g/t from 32m (HE20AC222) and 4m @ 0.54g/t from 16m (HE20AC223) suggest the presence of an
anomalous halo surrounding the gold mineralisation intersected in HE20AC221.
Results from this program indicate that mineralisation in the zone between Helens and Cardinia Hill contains several new
mineralised trends not previously defined by historical workings or by the limited shallow drilling undertaken by previous
explorers.
Full details of the Helens East drill results were provided in the Company’s ASX Announcements dated 27 April, 18 May and
3 June 2020.
Helens South
AC drilling at Helens South comprised 3,834m of drilling, following up on gold-in-soil anomalies identified in auger drilling.
The Helens South AC results confirmed the presence of mineralisation beneath soil anomalies, in areas without significant
historical workings and limited historical exploration.
Kin Mining NL
-25-
DIRECTORS’ REPORT
Results included 8m @ 1.80g/t from 4m (HS20AC285) and 4m @ 4.29g/t from 12m (HS20AC314). Both of these intercepts
were associated with quartz veining within felsic volcanic units. A full interpretation is underway alongside planning of follow-
up programs. Full details of the Helens South drill results were provided in the Company’s ASX Announcement dated 18 May
2020.
Snowden Well
A total of 13 RC holes for 880m were drilled along four separate sections at Snowden Well. The target sulphidic chert and
sediments were intersected in all holes. Assay results include:
1m at 3.93g/t Au from 38m (SW19RC001)
3m at 1.15g/t Au from 34m (SW19RC013)
3m at 1.70g/t Au from 39m (SW19RC004)
These intersections are all associated with iron rich chert and sediments mapped at surface as the westernmost of three
mineralised units that recently returned high grade rock chip results.
Drilling has demonstrated geological continuity over 600m of strike length of this mineralised western unit. Deeper drilling is
planned to determine the extent of the higher-grade mineralisation. Full details of the Snowden Hill drilling results were
provided in the Company’s ASX Announcement dated 3 February 2020.
Lewis West
The Lewis West prospect is a large gold-in-soil anomaly west of the Lewis deposit. Limited historical drilling has produced
intercepts including 1m at 22g/t gold.
It is interpreted that the soil anomalism is situated above northeast-dipping lodes, similar to those seen at Bruno, Lewis and
Lewis East.
The Kyte deposit features similar lodes and is located along strike of Lewis West. Two lines of AC drilling totalling 43 holes
for 641m were completed beneath the extensive soil anomaly, with results including:
16m at 0.38g/t Au from 0m (LW19AC012)
16m at 0.35g/t Au from 0m (LW19AC013)
16m at 0.30g/t Au from 0m (LW19AC014)
12m at 0.31g/t Au from 0m (LW19AC015)
4m at 0.93g/t Au from 8m to BOH (LW19AC031)
1m split assays at Lewis West confirmed the original 4m composite assays, producing wide low-grade intercepts (<0.5g/t Au)
including 16m @ 0.38g/t (LW19AC012) and 16m @ 0.35g/t (LW19AC013). The 1m splits identified narrow higher-grade
zones within these low grade zones, including 1m @ 3.24g/t from 10m (LW19AC031).
The results highlight a clear zone of anomalism located along a structure related to the Lewis Fault system. This suggests
the faults play an important role in focusing fluid flow before gold is deposited in favourable settings.
Geological logging shows a broad alteration halo with narrow zones of quartz veining and alteration in mafic rocks. Adjacent
to the December 2019 AC drill hole locations are historical, high grade drilling intersections and high-grade rock chips
associated with the Golden Dolerite surface workings. Rock chip results from Golden Dolerite included 21.2g/t Au and 11.3g/t
Au from the 0.5m wide expression of the quartz sulphide vein in old workings.
On the eastern side of the AC drilling, historical drilling results have been re-interpreted into a northeast dipping lode structure
similar to those encountered at Bruno, Lewis and Lewis East. The northeast dipping zone is associated with the northeast
trending Lewis Fault structure.
Historical intersections include:
3m at 3.6g/t Au from 18m (CRR1597)
1m at 9.6g/t Au from 83m (CRC1639)
6m at 4.2g/t Au from 9m (CRR1590)
Full details of the Lewis West exploration results were provided in the Company’s ASX Announcements dated 7 February
and 2 April 2020.
No further drilling at Lewis West is currently planned. Follow-up work on the higher grade historical drill intersections to the
east of the air-core drilling will be completed in due course.
Kin Mining NL
DIRECTORS’ REPORT
LAWLERS PROCESSING PLANT
-26-
During the reporting period, Kin Mining recovered all items from the Lawlers Processing Plant that it wished to recover for
potential future use at the CGP.
The Company acquired the Lawlers Processing Plant from Agnew Gold Mining Company Pty Ltd (Gold Fields) in June 2017
as part of its original development plan for the CGP. Subsequently, key elements of the plant were utilised by Como Engineers
as part of their detailed design of the Cardinia facility in the August 2019 Pre-Feasibility Study.
Since then, Kin has been pursuing a highly successful exploration-focused strategy at the CGP aimed at making new
discoveries and unlocking the broader potential of what it believes to be a large-scale gold system (as outlined above).
During the March 2020 quarter, Kin was able to dismantle and relocate all the items of the Lawlers Process Plant that form
part of the CGP plant design before COVID-19 restrictions required Kin to cease further work at the Gold Fields owned site.
After discussions with Gold Fields, it was agreed that Kin will transfer title in the assets that remain at Lawlers back to Gold
Fields in exchange for a full release from any further obligations to dismantle and remove the remaining assets.
Kin would like to thank Gold Fields for their assistance in Kin’s operations at the Lawlers site, for their understanding of the
challenges Kin faced immediately following the suspension of construction at the Cardinia process plant site in April 2018 and
for their assistance during the Covid-19 affected period.
-27-
Kin Mining NL
DIRECTORS’ REPORT
CORPORATE
Board and Management Changes
A number of changes were made to the composition of the Board and Management during the period.
On 31 July 2019 Mr Hansjoerg Plaggemars and Mr Nicholas Anderson joined the Board as a Non-Executive Directors as
causal appointments following the resignation of Mr Jeremy Kirkwood and Mr Trevor Dixon.
With the resignation of Mr Jeremy Kirkwood, Mr Giuseppe (Joe) Graziano was appointed as Non-Executive Chairman on 1
August 2019.
Details of the current Board and management team are contained in the Directors Report.
Sprott Credit Facility
In December 2017, Kin entered into an agreement with Sprott Private Resource Lending (Collector) LP (“Sprott”) to provide
a US$27M (~A$35M) senior secured credit facility (the “Credit Facility”) to be used for the construction of the CGP.
Following a decision to review the CGP in 2018 the Company and Sprott agreed to vary the credit agreement with an early
repayment of the outstanding balance except for US$1 and the removal of all security and covenant requirements while the
outstanding balance is only US$1. The variations to the agreement following the early repayment included:
an increase in the availability period from 30 June 2019 to 30 June 2021,
an extension in the maturity date of the facility to 31 March 2023,
commencement of quarterly principal repayments (on any future drawdowns) has been moved forward to 30
June 2021,
an amendment to the secured position (during the period that the loan outstanding is USD$1) to just cover
the 1.5% NSR.
As a result of the modification to the terms of the credit agreement transaction costs of $1,381,201 were expensed in the prior
reporting period.
In early 2020 Sprott advised the Company that the credit facility was no longer available and the credit facility agreements
would need to be terminated while the 1.5% NSR would remain. Kin is working through the release documentation with Sprott.
Share Placement
In March 2020 Kin Mining undertook a Share Placement to raise a total of $2.64 million through the issue of 58.667 million
ordinary fully paid shares (Shares) priced at $0.045 per share.
This Placement was completed to Kin’s existing four major shareholders: Delphi Unternehmensberatung AG (Delphi UA),
Harmanis Holdings, Mostia Dion and the Canci Group.
The issue of all Shares under the Placement was completed within Kin’s existing capacity under ASX Listing Rule 7.1.
Funds were used to progress the Phase II exploration program which commenced in November 2019 consisting of AC and
RC drilling at a range of targets and recent discoveries at the CGP
Rights Issue
Kin Mining announced a Rights Issue on 12 June 2020 which was completed subsequent to the end of the reporting period.
This comprised a non-underwritten, non-renounceable 1-for-7 pro-rata Entitlement Offer to raise up to $9.9 million to progress
the next phase of exploration at the CGP.
In accordance with Appendix 7A of the ASX Listing Rules, the Company received valid acceptances for 55,147,263 new
shares ($6.066 million), with a Shortfall remaining of 34,808,571 new shares.
Kin Mining successfully placed a further 14,876,249 new shares after receiving applications and funds for the Shortfall.
Participants in the Shortfall included a new Australian-based investor, who subscribed for $1.0 million worth of shares, and
Kin’s two largest shareholders (Delphi, which subscribed for $0.256 million, and Harmanis Holdings, who subscribed for
$0.317 million).
Kin Mining NL
DIRECTORS’ REPORT
Despite strong levels of interest and demand for the Shortfall, Kin Mining’s Board made the decision to restrict the amount of
new shares being issued, given that its Phase III program is fully-funded through to the end of FY2021, and the Company
expects to generate strong news-flow from drilling activities over the coming months.
-28-
The remaining 20 million shares in Shortfall remain available for distribution at the Directors’ discretion within three months of
the closure of the Rights Issue offer on 8 July 2020.
The issue of Shortfall shares to Delphi Unternehmensberatung AG (Delphi UA) is expected to take place on or around 24
September 2020, once Delphi UA is permitted to increase its shareholding in accordance with Chapter 6 of the Corporations
Act. Shortfall placement to Delphi UA is also subject to FIRB approval. The Delphi Shortfall application funds will be held in
trust until shares can be issued, or refunded in the event that FIRB approval is not received within the 3-month period.
Subsequent Events
On 14 July 2020, the Company announced that it had closed the Rights Issue that opened on announced on 22 June 2020.
The Rights Issue closed with the issue of 55,147,263 new shares for proceeds of $6,066,199 (before costs). On 20 July 2020
Kin issued a further 12,546,610 new shares for proceeds of $1,380,127 (before costs) and had agreed to issue a further
2,329,639 shares ($256,260) subject to receiving FIRB approval. Subject to FIRB approval the Company will have raised
$7,702,587 (before costs) which will enable the Company to proceed with its exploration activities.
On 16 July 2020 the Company issued 264,443 shares to Mr Andrew Munckton as shares on exercise of Performance Rights.
The Performance Rights vested on 9 July 2020 when the Companies Directors determined that the performance criteria
required to be met for the vesting of the Performance Rights had been met. At the same time the Directors determined that
Mr Munckton had met the performance criteria required to achieve his Short Term Incentive (STI) payments and authorised
the payment of an STI for the 2019/20 year of $146,000.
Likely developments and expected results
Disclosure of information regarding likely developments in the operations of the Group in future financial years and the
expected results of those operations is likely to result in unreasonable prejudice to the Group. Therefore, this information has
not been presented in this report.
Environmental legislation
The Group is subject to the environmental legislation of the State of Western Australia. The Group is in compliance with all
its environmental obligations at the date of this report.
Significant changes in state of affairs
There have been no significant changes in the state of affairs of the Group during the financial year.
Dividends
No dividends have been paid or declared since the start of the financial year and the directors do not recommend the payment
of a dividend in respect of the financial year.
Indemnification and insurance of Directors and Officers
The Company has agreed to indemnify all the directors of the Company for any liabilities to another person (other than the
Company or related body corporate) that may arise from their position as directors of the Company and its controlled entities,
except where the liability arises out of conduct involving a lack of good faith.
During the financial year, the Company paid a premium in respect of a contract insuring the directors and officers of the
Company and its controlled entities against any liability incurred in the course of their duties 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.
Kin Mining NL
DIRECTORS’ REPORT
REMUNERATION REPORT (AUDITED)
-29-
This report, which forms part of the directors’ report, outlines the remuneration arrangements in place for the key management
personnel (“KMP”) of Kin Mining NL for the financial year ended 30 June 2020. The information provided in this remuneration
report has been audited as required by Section 308(3C) of the Corporations Act 2001.
The remuneration report details the remuneration arrangements for KMP who are defined as those persons having authority
and responsibility for planning, directing and controlling the major activities of the Company, directly or indirectly, including
any director (whether executive or otherwise) of the Company.
Key Management Personnel
The Directors and other KMP of the Group during or since the end of the financial year were the directors of the Company as
follows:
Directors:
G Graziano
A Munckton
B Dawes
H Plaggemars
N Anderson
J Kirkwood
T Dixon
Non-executive Chairman (from 1 August 2019)
Managing Director
Non-executive Director
Non-executive Director (appointed 31 July 2019)
Non-executive Director (appointed 31 July 2019)
Non-executive Chairman (resigned 31 July 2019)
Executive Director (resigned 31 July 2019)
Tenement and Land Manager and Business Development Manager (ceased on 30 April
2020)
Other Key Management:
S Jones
G Grayson
J Kelly
A Pate
Chief Financial Officer and Company Secretary
Exploration Manager
Mining Manager
Health Safety and Environment Manager (resigned 4 October 2019)
Except as noted, the named persons held their current positions for the whole of the financial year.
Remuneration philosophy
The performance of the Group depends upon the quality of the directors and executives. The philosophy of the Group in
determining remuneration levels is to:
set competitive remuneration packages to attract and retain high calibre employees;
link executive rewards to shareholder value creation; and
establish appropriate, demanding performance hurdles for variable executive remuneration.
In considering the Group’s performance and returns on shareholder wealth, the Board has regard to the following indicators
of performance in respect of the current financial year and the previous four financial years:
2020
2019
2018
2017
2016
Revenue
15,670
49,133
41,306
11,532
1,057
Net profit/(loss) after tax
(7,242,452)
(14,555,272)
(15,793,246)
(10,662,621)
(3,446,559)
Loss per share
Share price at year-end
(1.30)
0.115
(3.70)
0.052
(8.00)
(9.29)
(4.92)
0.120
0.355
0.250
Kin Mining NL
DIRECTORS’ REPORT
REMUNERATION REPORT (CONTINUED)
-30-
Remuneration governance
The Company has not formed a remuneration committee. The role of a remuneration committee is instead carried out by the
full Board in accordance with the Nomination and Remuneration Committee charter.
Non-executive director remuneration
The Board seeks to set aggregate remuneration at a level that provides the Company with the ability to attract and retain
directors of the highest calibre, whilst incurring a cost that is acceptable to shareholders.
The amount of aggregate remuneration sought to be approved by shareholders and the manner in which it is apportioned
amongst directors is reviewed annually. The Board considers advice from external shareholders as well as the fees paid to
non-executive directors of comparable companies when undertaking the annual review process.
Each director receives a fee for being a director of the Company. An additional fee is also paid for each Board committee on
which a director sits. The payment of additional fees for serving on a committee recognises the additional time commitment
required by directors who serve on one or more sub committees.
Executive directors and key management personnel remuneration
The Board is responsible for determining the remuneration policies for the Executive Directors and other key management
personnel. The Board may seek external advice to assist in its decision making. The Company’s remuneration policy for
Executive Directors and key management personnel is designed to motivate Executive Directors and senior executives to
pursue long term growth and success of the Company within an appropriate control framework promote superior performance
and long term commitment to the Company. The main principles of the policy when considering remuneration are as follows:
Executive Directors and key management personnel are motivated to pursue long term growth and success of the
Company within an appropriate control framework;
interests of key leadership are aligned with the long-term interests of the Company’s shareholders; and
there is a clear correlation between performance and remuneration.
The remuneration policy for Executive Directors and other key management personnel has three main components, fixed
remuneration, short term incentives and longer term incentives.
Fixed remuneration
Fixed remuneration is reviewed annually by the Board. The process consists of a review of relevant comparative remuneration
in the market and internally and, where appropriate, external advice on policies and practices. The Committee has access to
external, independent advice where necessary.
Group’s Financial Performance and Link to Remuneration
The Key Management Personnel’s remuneration has a variable component for short term incentives and long term incentives
to link the achievement of the Company’s operational targets with the remuneration received by Executive Directors and other
key management charged with meeting those targets.
Variable remuneration - Short-term incentives
The objective of short term incentives is to link the achievement of the Company’s operational targets with the remuneration
received by Executive Directors and other key management charged with meeting those targets. The total potential short term
incentive available is set at a level so as to provide sufficient incentive to the Executive Directors and other key management
to achieve the operational targets and such that the cost to the Company is reasonable in the circumstances.
Actual payments granted to Executive Directors and other key management depends on the extent to which specific operating
targets set by the Board are met.
At this time short term incentives in the form of cash bonuses and Performance Rights have been included in some Key
management personnel contracts as disclosed in this Remuneration Report.
The aggregate of annual payments available to Executive Directors and other key management of the Company is subject to
the approval of the Board.
Variable remuneration - Long-term incentives
The Company has an approved Employee Share Scheme designed to facilitate long term incentive payments to employees
in a manner that aligns this element of remuneration with the creation of shareholder wealth.
At the 21 November 2019 Annual General Meeting of the Company the shareholders approved the issue of up to 4,000,000
Performance Rights to be issued in line with the Employee Share Scheme as Long Term Incentives for the Managing Director.
The Company has not utilised a remuneration consultant in the current year.
Kin Mining NL
DIRECTORS’ REPORT
REMUNERATION REPORT (CONTINUED)
-31-
Employment Contracts
Details of employment contracts currently in place with respect to directors’ and key management personnel employment with
the company are as follows:
Giuseppe (Joe) Paolo Graziano, Non-Executive Chairman
Director’s fees of $50,000 per annum.
Long term incentives as granted by the Board as part of a grant of benefits to Directors and subject to shareholder
approval.
Andrew Munckton, Managing Director
Base annual remuneration of $325,000 inclusive of statutory superannuation contributions (Total Fixed
Remuneration or TFR).
Annual Short Term Incentives (STI) in the form of a cash payment up to 50% of the TFR.
Annual Long Term Incentives (STI) in the form of equity up to 30% of the TFR.
The appointment will be on an ongoing basis with termination provisions summarised below
o The employment agreement may be terminated by either party with three months’ notice.
o The employment agreement may be terminated by Kin Mining without notice for serious misconduct or
other circumstances justifying summary dismissal. In this case only accrued legal entitlements will be paid.
Brian Dawes, Non-Executive Director
Director’s fees of $36,000 per annum inclusive of statutory superannuation contributions.
Hansjoerg Plaggemars, Non-Executive Director
Director’s fees of $36,000 per annum.
Nicholas Anderson, Non-Executive Director
Director’s fees of $36,000 per annum.
Stephen Jones, Chief Financial Officer & Company Secretary
Base annual remuneration of $250,000 exclusive of statutory superannuation contributions.
The appointment will be on an ongoing basis with termination provisions summarised below
o The employment agreement may be terminated by either party with three months’ notice.
o The employment agreement may be terminated by Kin Mining without notice for serious misconduct or
other circumstances justifying summary dismissal. In this case only accrued legal entitlements will be paid.
o The employment agreement may be terminated immediately by the employee on a “Change of Control”
o
or a “Change in Employment”.
If the employment is terminated by the employer or by the employee following a change in control or
employment the employer will pay an amount of 12 months on termination.
John Kelly, Mining Manager
Base annual remuneration of $270,000 inclusive of statutory superannuation contributions.
The appointment will be on an ongoing basis with termination provisions summarised below
o The employment agreement may be terminated by either party with one month’s notice.
o The employment agreement may be terminated by Kin Mining without notice for serious misconduct or
other circumstances justifying summary dismissal. In this case only accrued legal entitlements will be paid.
-32-
Kin Mining NL
DIRECTORS’ REPORT
REMUNERATION REPORT (CONTINUED)
Glenn Grayson, Exploration Manager
Base annual remuneration of $190,000 exclusive of statutory superannuation contributions.
The appointment will be on an ongoing basis with termination provisions summarised below
o The employment agreement may be terminated by either party with one month’s notice.
o The employment agreement may be terminated by Kin Mining without notice for serious misconduct or
other circumstances justifying summary dismissal. In this case only accrued legal entitlements will be paid.
o The employment agreement may be terminated immediately by the employee on a “Change of Control”
o
or a “Change in Employment”.
If the employment is terminated by the employer or by the employee following a change in control or
employment the employer will pay an amount of 12 months on termination.
Remuneration of Key Management Personnel
Short-term employee
benefits
Post-
employment
benefits
Equity
Performance
Related
30 June 2020
Salary &
fees
Consulting
Directors
J Kirkwood
G Graziano
B Dawes
A Munckton
N Anderson
H Plaggemars
KMP
T Dixon
S Jones
G Grayson
J Kelly
A Pate
$
3,805
45,084
30,411
288,797
30,300
30,300
181,5531
233,460
195,500
236,548
58,164
1,333,922
$
-
-
-
-
-
-
-
-
-
-
-
-
Non-
monetary
benefits
$
Other
Superannuation
Performance
Rights
$
$
$
-
-
-
246,0002
-
-
-
-
-
-
-
361
-
2,889
24,963
-
-
15,2041
21,003
18,573
24,174
4,375
-
-
-
10,0493
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Total
$
4,167
45,084
33,300
569,809
30,300
30,300
196,757
254,463
214,073
260,722
62,539
%4
-
-
-
45
-
-
-
-
-
-
-
-
246,000
111,542
10,049
1,701,513
1 Mr. T Dixon received $2,739 for Directors fees and $260 of related superannuation for July 2019 prior to his resignation as a
Director on 31 July 2019.
2 Other benefits were paid in accordance with short term incentives in executive employment contracts. $100,000 related to short
term incentives for the year ended 30 June 2019 (less than the maximum 50% contracted value) that were approved and paid in
November 2019 and $146,000 related to short term incentives for the year ended 30 June 2020 (less than the maximum 50%
contracted value) approved and paid in July 2020.
Performance Rights related to the year ended 30 June 2020 vested and were issued after year end.
Percentage of performance based remuneration.
3
4
Kin Mining NL
Equity
Share
options
Performance
related
Total
%
DIRECTORS’ REPORT
REMUNERATION REPORT (CONTINUED)
-33-
Short-term employee
benefits
Post-
employment
benefits
30 June
2019
Directors
J Kirkwood
T Dixon
Salary &
fees
$
45,662
207,458
Consulting
$
-
-
G Graziano
36,000
21,0001
B Dawes
32,877
A Munckton
283,623
KMP
S Jones
G Grayson
J Kelly
A Pate
G Goh
250,000
190,000
82,197
153,965
169,994
-
-
-
-
-
-
-
Non-
monetary
benefits
$
-
-
-
-
-
-
-
-
-
-
Other
Superannuation
$
-
-
-
-
-
-
-
-
-
-
$
4,338
19,709
-
3,123
24,657
20,531
18,050
6,844
14,627
12,622
$
$
-
-
-
-
-
-
-
-
-
-
50,000
227,167
57,000
36,000
308,280
270,531
208,050
89,041
168,592
182,616
-
-
-
-
-
-
-
-
-
-
-
1 Consulting services rendered by Mr. Graziano were via Pathways Corporate Pty Ltd for Company Secretarial services during the
1,451,776
1,597,277
124,501
21,000
-
-
period (GST exclusive).
Shareholdings of key management personnel
Shares
Purchased
No.
Shares
Issued
No.
Shares
Acquisition
No.
Shares on
Resignation
No.
2020
Directors
G Graziano
B Dawes
A Munckton
N Anderson
H Plaggemars
J Kirkwood 1
KMP
S Jones
G Grayson
J Kelly
T Dixon 2
A Pate
Balance at
01/07/19
No.
8,843,750
805,655
52,313
-
-
3,260,295
194,099
-
-
12,352,660
-
25,508,772
-
570,000
250,000
621,999
150,000
-
-
56,000
-
-
-
1,647,999
755,470
100,707
6,540
28,000
-
-
167,120
-
-
-
-
1,057,837
1 Mr Kirkwood resigned on 1 August 2019.
2 Mr Dixon ceased employment on 30 April 2020.
Balance at
30/06/20
No.
9,559,220
1,476,362
308,853
649,999
150,000
-
-
-
-
-
-
-
-
-
-
-
-
(3,260,295)
-
-
-
-
-
-
-
-
-
(12,352,660)
-
361,219
56,000
-
-
-
(15,612,955) 12,601,653
Kin Mining NL
DIRECTORS’ REPORT
REMUNERATION REPORT (CONTINUED)
-34-
2019
Directors
J Kirkwood
T Dixon
G Graziano
B Dawes
A Munckton
KMP
S Jones
G Grayson
J Kelly
A Pate
G Goh1
Balance at
01/07/18
No.
-
12,152,660
8,343,750
270,886
-
194,099
-
-
-
97,050
21,058,445
Shares
Purchased
No.
3,260,295
200,000
500,000
534,769
52,313
-
-
-
-
-
4,547,377
Shares
Issued
No.
Shares
Acquisition
No.
Shares on
Resignation
No.
Balance at
30/06/19
No.
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(97,050)
(97,050)
3,260,295
12,352,660
8,843,750
805,655
52,313
194,099
-
-
-
-
25,508,772
3 Mr Goh resigned on 1 February 2019. The number of shares disposed is the number of shares they held at the time of their
resignation.
Option holdings of key management personnel
2020
Balance
at 01/07/19
No.
Options
Purchased
No.
Directors
G Graziano
B Dawes
A Munckton
J Kirkwood
KMP
S Jones
J Kelly
G Grayson
A Pate
T Dixon1
5,000,000
-
-
-
-
-
-
-
6,000,000
11,000,000
1 Mr Dixon ceased work on 30 April 2020.
-
-
-
-
-
-
-
-
-
-
Options
Disposed
No.
Options
Issued
No.
Options on
Resignation
No.
Balance
at 30/06/20
No.
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
5,000,000
-
-
-
-
-
-
-
-
-
-
(6,000,000)
-
-
-
-
-
(6,000,000)
5,000,000
2019
Directors
J Kirkwood
T Dixon
G Graziano
B Dawes
A Munckton
KMP
S Jones
J Kelly
G Grayson
A Pate
G Goh1
Balance
at 01/07/18
No.
-
6,037,500
5,075,000
-
-
-
-
-
-
-
Options
Purchased
No.
Options
Disposed
No.
Options
Issued
No.
Options
Expired
No.
Balance
at 30/06/19
No.
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(37,500)
(75,000)
-
-
-
6,000,000
5,000,000
-
-
-
-
-
-
-
-
-
-
-
-
(112,500) 11,000,000
-
1 Mr Goh resigned on 1 February 2019. No options were held at the time of resignation.
11,112,500
-
-
Kin Mining NL
DIRECTORS’ REPORT
REMUNERATION REPORT (CONTINUED)
Share-based remuneration granted as compensation
-35-
There was $10,049 recognised as a vesting expense on performance rights held by key management personnel.
Performance Rights holdings of key management personnel
2020 – None
2019 – None
Three Executives have performance rights included in their remuneration structures as disclosed below.
Mr Andrew Munckton has Long Term Incentives (LTI) included in his employment contract. In November 2019 the
shareholders agreed to grant LTI’s in the form of performance rights to Mr Andrew Munckton in three tranches over three
years as follows:
Tranche
Performance Period
Maximum allocation of long term incentives
Tranche 1
1 July 2019 – 30 June 2020
Tranche 2
1 July 2020 – 30 June 2021
Tranche 3
1 July 2021 – 30 June 2022
$32,500
$32,500
$32,500
The Performance Rights will, subject to meeting the Performance Measures, vest into shares in the Company in accordance
with the following formula.
Number of shares =
Volume Weighted Average Price (VWAP) of the Company’s shares over the 10 days
on which trading in the Employer’s shares occurred leading up to and including the
day prior to the vesting date
$ value of the Performance Rights
The Performance Rights will vest on satisfaction of the following performance conditions.
The Board will have the unfettered and absolute right to determine and confirm whether vesting conditions have been met in
respect of each and all tranches. In making its determination the Board will recognise the relevant tranche objective at the
end of the applicable vesting period and have regard to implementation of the Business Plan, as well as other proposals
endorsed by the Board as part of its ongoing review of strategy.
Vesting conditions will be a shareholder aligned measure (Total Shareholder Return – TSR).
Vesting of each Tranche will be measured in absolute terms and relative terms against a defined peer group approved by the
Board which is reflective of companies in the same industry with similar issues in respect of organisational size, market
capitalisation, geography, life cycle and project complexity as shown in the table below.
DIRECTORS’ REPORT
REMUNERATION REPORT (CONTINUED)
-36-
Tranche1
Vesting conditions (Tranche Objective)
Weighting
Kin Mining NL
Tranche 1
Tranche 2
Tranche 3
Company’s Absolute TSR
Company’s TSR relative to Peers
Company’s Absolute TSR
Company’s TSR relative to Peers
Company’s Absolute TSR
Company’s TSR relative to Peers
50%
50%
50%
50%
50%
50%
1) The number of Performance Rights to be granted is calculated by dividing each $32,500 tranche by the VWAP of
the Company’s Shares over the 10 days on which trading in the Company’s Shares occurred leading up to and
including the day prior to the vesting date.
After the end of the current financial year (year to 30 June 2020) the Board determined that the vesting conditions for Tranche
1 had been met and 264,443 shares were issued to Mr Munckton on 16 July 2020 following the issue of and exercise of
Tranche 1 Performance Rights.
Performance rights and cash bonuses have been granted to Mr Stephen Jones that vest and may be converted to shares
following the achievement of future performance hurdles as follows:
Performance Hurdles
Conditions
Capital Expenditure on CGP is within
10% of budget
First Month of gold production
exceeding 4,000 fine ounces output
from the CGP
Steady State production at design
throughput of the CGP mill
Budget and contingency to be determined from the DFS
with allocation and cash payment made within 1 month
following internal accounts demonstrating the milestone
Allocation and cash payment made within 1 month
following the milestone
Six months commercial production having achieved
design throughput and gold output with allocation and
cash payment made within 1 month following the
milestone
Stephen Jones
Performance
Rights *
Cash Bonus
$50,000
$25,000
$50,000
$25,000
$50,000
$25,000
* Performance Rights will, subject to meeting the Performance Hurdles, vest into shares in the Employer in accordance with the following formula.
Number of shares =
Volume Weighted Average Price (VWAP) of the Employer’s shares over the 5 days on which trading in the
Employer’s shares occurred leading up to and including the day prior to the vesting date
$ value of the Performance Rights
Performance rights and cash bonuses have been granted to Mr Glenn Grayson that vest and may be converted to shares
following the achievement of future performance hurdles as follows:
Performance Hurdles
Conditions
Discover sufficient resources to improve the
mill head grade in first 12 months of production
to 1.8 g/t Au prior to start of mining
Increase LGP resources to 1.5Moz in line with
industry average $/resource oz
Increase LGP resources to 2Moz in line with
industry average $/resource oz
Allocation and cash payment made within 1
month following the milestone
Allocation and cash payment made within 1
month following the milestone
Allocation and cash payment made within 1
month following the milestone
Glenn Grayson
Performance
Rights *
Cash Bonus
$100,000 $50,000
$100,000 $50,000
$100,000 $50,000
$300,000 $150,000
There were no options exercised during the year.
-37-
Kin Mining NL
DIRECTORS’ REPORT
REMUNERATION REPORT (CONTINUED)
Share options
During the year no share options were granted to Directors and the KMP as compensation or remuneration.
At the Annual General Meeting of shareholders on 21 November 2019 the shareholders approved the issue of up to 4,000,000
performance rights to the Managing Director Mr Andrew Munckton in settlement of Long Term Incentives in line with the
Executive Employment Agreement. After the year end the Board of Directors determined that Mr Munckton had met the
performance criteria set for the first tranche of these performance rights to vest. As a result, the Company issued 264,443
shares to Mr Munckton on 16 July after Mr Munckton exercised the performance rights that had vested.
Other transactions with Key Management Personnel
Pathways Corporate Pty Ltd, a company of which Mr. Graziano is a Director, charged the Group director fees of $45,084
(2019: $36,000), excluding GST, none of which was outstanding at 30 June 2020 (2019: Nil). No interest was payable or
accrued.
END OF REMUNERATION REPORT
Shares under option or issued on exercise of options
At the date of this report unissued ordinary shares or interests of the Company under option are:
Date options granted
Number of shares under
option
15 September 2017
15 September 2017
15 September 2017
9,000,000
6,000,000
4,000,000
Exercise price of option
Expiry date of option
$0.75
$1.00
$1.25
15 September 2022
15 September 2021
15 September 2022
There were no ordinary shares issued by the Company during or since the end of the financial year as a result of the exercise
of any options.
Directors’ Meetings
The number of meetings of directors (including meetings of committees of directors) held during the year and the number of
meetings attended by each director were as follows:
Number of meetings held:
Number of meetings attended:
G Graziano
B Dawes
A Munckton
N Anderson 2
H Plaggemars 2
J Kirkwood 1
T Dixon 1
Directors’ meetings
15
15
15
15
14
13
1
1
1Mr Kirkwood and Mr Dixon resigned from their Director roles on 31 July 2019. There was only one meeting held between 1
July 2019 and 31 July 2019.
2Mr Anderson and Mr Plaggemars commenced as Directors on 31 July 2019. There were 14 meetings of Directors from the
date of their appointment to 30 June 2020.
Kin Mining NL
-38-
DIRECTORS’ REPORT
Proceedings on behalf of the Company
No person has applied for leave of court to bring proceedings on behalf of the Company or intervene in any proceedings to
which the Company is a party for the purpose of taking responsibility on behalf of the Company for all or any part of those
proceedings.
Non-Audit Services
Details of amounts paid or payable to the auditor for all services provided during the year by the auditor are outlined in Note
21 to the financial statements. No non-audits services were provided during the year ended 30 June 2020 (2019: $Nil).
Auditor Independence and Non-Audit Services
Section 307C of the Corporations Act 2001 requires our auditors, HLB Mann Judd, to provide the directors of the Company
with an Independence Declaration in relation to the audit of the financial report. This Independence Declaration is set out on
page 41 and forms part of this directors’ report for the year ended 30 June 2020.
Signed in accordance with a resolution of the directors.
Andrew Munckton
Managing Director
Perth, Western Australia
Kin Mining NL
DIRECTORS’ REPORT
Competent Persons Statement (Mineral Resources Estimate)
-39-
The information contained in this report relating to Resource Estimation results relates to information compiled by Mr Jamie
Logan. Mr Logan is a member of the Australian Institute of Geoscientists and was till recently a full time employee of the
company. Mr Logan has sufficient experience of relevance to the styles of mineralisation and the types of deposit under
consideration, and to the activities 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".
Mr Logan consents to the inclusion in this report of the matters based on information in the form and context in which it
appears.
Competent Persons Statement (Ore Reserves)
The information contained in the report that relates to ore reserves at the Cardinia Gold Project is based on information
compiled or reviewed by Mr. Craig Mann who is a fulltime employee of Entech Pty Ltd. Mr. Mann confirms that he has read
and understood the requirements of the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral
Resources and Ore Reserves (JORC Code 2012 JORC Edition). He is a Competent Person as defined by the JORC Code
2012 Edition, having five years’ experience which is relevant to the style of mineralisation and type of deposit described in
the Report, and to the activity for which he is accepting responsibility. He is a Member of The Australasian Institute of Mining
and Metallurgy, he has reviewed the Report to which this consent statement applies, for the period ended 31st August 2019.
He verifies that the Report is based on and fairly and accurately reflects in the form and context in which it appears, the
information in his supporting documentation relating to Ore Reserves.
Forward Looking Statements
This report contains “forward-looking information” that is based on the Company’s expectations, estimates and projections as
of the date on which the statements were made. This forward-looking information includes, among other things, statements
with respect to the feasibility and definitive feasibility studies, the Company’s’ business strategy, plan, development,
objectives, performance, outlook, growth, cash flow, projections, targets and expectations, mineral reserves and resources,
results of exploration and operational expenses. Generally, this forward-looking information can be identified by the use of
forward-looking terminology such as ‘outlook’, ‘anticipate’, ‘project’, ‘target’, ‘likely’,’ believe’, ’estimate’, ‘expect’, ’intend’,
’may’, ’would’, ’could’, ’should’, ’scheduled’, ’will’, ’plan’, ’forecast’, ’evolve’ and similar expressions. Forward- looking
information is subject to known and unknown risks, uncertainties and other factors that may cause the Company’s actual
results, level of activity, performance or achievements to be materially different from those expressed or implied by such
forward-looking information. Forward-looking information is developed based on assumptions about such risks, uncertainties
and other factors set out herein.
This list is not exhausted of the factors that may affect our forward-looking information. These and other factors should be
considered carefully and readers should not place undue reliance on such forward-looking information. The Company
disclaims any intent or obligations to or revise any forward-looking statements whether as a result of new information,
estimates, or options, future events or results or otherwise, unless required to do so by law. Statements regarding plans with
respect to the Company’s mineral properties may contain forward-looking statements in relation to future matters that can be
only made where the Company has a reasonable basis for making those statements. This announcement has been prepared
in compliance with the JORC Code 2012 Edition and the current ASX Listing Rules. The Company believes that it has a
reasonable basis for making the forward-looking statements in this announcement, including with respect to any mining of
mineralised material, modifying factors and production targets and financial forecasts.
CORPORATE GOVERANCE STATEMENT
-40-
Kin Mining NL
The Board is committed to achieving and demonstrating the highest standards of corporate governance. As such, Kin Mining
NL and its controlled entities have adopted the fourth edition of the Corporate Governance Principles and Recommendations
which was released by the ASX Corporate Governance Council in February 2019 and became effective for financial years
beginning on or after 1 January 2020.
The Group’s Corporate Governance Statement for the financial year ending 30 June 2020 is dated as at 30 June 2020 and
was approved by the Board on 8 June 2020. The Corporate Governance Statement is available on Kin Mining NL’s website
at https://www.kinmining.com.au/about/governance/.
-41-
AUDITOR’S INDEPENDENCE DECLARATION
As lead auditor for the audit of the consolidated financial report of Kin Mining NL for the year
ended 30 June 2020, I declare that to the best of my knowledge and belief, there have been no
contraventions of:
a)
the auditor independence requirements of the Corporations Act 2001 in relation to the
audit; and
b)
any applicable code of professional conduct in relation to the audit.
Perth, Western Australia
2 September 2020
D I Buckley
Partner
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE
INCOME
FOR THE YEAR ENDED 30 JUNE 2020
-42-
Kin Mining NL
Continuing operations
Revenue:
Interest income
Other income
Gain/ (loss) on sale of assets
Depreciation and amortisation expense
Administration expenses
Consultant expenses
Employee expenses
Share based payment expense
Finance costs
Occupancy expenses
Travel expenses
Exploration and evaluation costs
Impairment expense
Unrealised foreign exchange losses
Loss before income tax expense
Income tax benefit
Net loss for the year
Notes
2020
$
2019
$
2
10
2
11
3
15,670
53,360
(94,696)
(266,030)
(542,448)
(66,380)
(1,202,879)
(10,049)
-
(59,617)
(7,191)
(5,062,192)
-
-
(7,242,452)
-
(7,242,452)
49,133
38,108
2,817
(326,083)
(839,826)
(87,764)
(1,322,253)
-
(1,677,165)
(95,103)
(31,745)
(8,366,973)
(1,768,254)
(130,164)
(14,555,272)
-
(14,555,272)
Other comprehensive income, net of income tax
Other comprehensive income for the year, net of tax
-
-
-
-
Total comprehensive loss for the year
(7,242,452)
(14,555,272)
Basic loss per share (cents per share)
5
(1.30)
(3.70)
The accompanying notes form part of these consolidated financial statements.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2020
-43-
Kin Mining NL
Assets
Current assets
Cash and cash equivalents
Trade and other receivables
Other current assets
Total current assets
Non-current assets
Property, plant and equipment
Total non-current assets
Total assets
Liabilities
Current liabilities
Trade and other payables
Borrowings
Total current liabilities
Non-current liabilities
Provisions
Total non-current liabilities
Total liabilities
Net assets
Equity
Issued capital
Share based payments reserve
Accumulated losses
Total equity
Notes
2020
$
2019
$
7
8
9
10
12
14
13
15
1,665,997
28,071
39,280
1,733,348
3,148,063
52,746
25,906
3,226,715
10,383,469
10,383,469
12,116,817
10,554,609
10,554,609
13,781,324
864,586
1
864,587
1,500,000
1,500,000
2,364,587
9,752,230
888,226
1
888,227
1,500,000
1,500,000
2,388,227
11,393,097
68,455,189
1,828,537
(60,531,496)
9,752,230
62,863,653
1,818,488
(53,289,044)
11,393,097
The accompanying notes form part of these consolidated financial statements.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2020
-44-
Kin Mining NL
Balance as at 1 July 2018
Loss for the year
Total comprehensive loss for the year
Share based payments
Shares issued during the year
Share issue costs
Balance as at 30 June 2019
Balance as at 1 July 2019
Loss for the year
Total comprehensive loss for the year
Share based payments
Shares issued during the year
Share issue costs
Issued capital
$
Notes
43,175,285
-
-
-
20,361,352
(672,984)
62,863,653
Accumulated
losses
$
(38,733,772)
(14,555,272)
(14,555,272)
-
-
-
(53,289,044)
62,863,653
-
-
-
5,707,849
(116,313)
(53,289,044)
(7,242,452)
(7,242,452)
-
-
-
Share based
payments
reserve
$
1,818,488
-
-
-
-
-
1,818,488
1,818,488
-
-
10,049
-
-
Total equity
$
6,260,001
(14,555,272)
(14,555,272)
-
20,361,352
(672,984)
11,393,097
11,393,097
(7,242,452)
(7,242,452)
10,049
5,707,849
(116,313)
Balance as at 30 June 2020
68,455,189
(60,531,496)
1,828,537
9,752,230
The accompanying notes form part of these consolidated financial statements.
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2020
-45-
Cash flows from operating activities
Payments to suppliers and employees
Interest received
Finance costs
Net cash (outflow) from operating activities
Cash flows from investing activities
Proceeds from sale of plant and equipment
Payments for property, plant and equipment
Net cash (outflow) from investing activities
Cash flows from financing activities
Proceeds from issue of shares
Payments for share issue costs
Repayment of borrowings
Net cash inflow from financing activities
Net (decrease)/ increase in cash and cash equivalents
Cash and cash equivalents at the beginning of the year
Cash and cash equivalents at the end of the year
Kin Mining NL
Notes
2020
$
2019
$
(6,831,261)
15,670
-
(6,815,591)
(10,648,277)
49,133
(356,351)
(10,955,495)
222,353
(480,364)
(258,011)
-
(897,971)
(897,971)
5,707,849
(116,313)
-
5,591,536
(1,482,066)
3,148,063
1,665,997
19,976,362
(287,994)
(6,882,357)
12,806,011
952,545
2,195,518
3,148,063
7
7
7
The accompanying notes form part of these consolidated financial statements.
-46-
Kin Mining NL
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES
Basis of preparation
(a)
These financial statements are general purpose financial statements, which have been prepared in accordance with the
requirements of the Corporations Act 2001, Accounting Standards and Interpretations and comply with other requirements of
the law.
The financial statements comprise the consolidated financial statements for the Group. For the purposes of preparing the
consolidated financial statements, the Company is a for-profit entity.
The accounting policies detailed below have been consistently applied to all of the years presented unless otherwise stated.
The financial statements are for the Group consisting of Kin Mining NL and its subsidiaries.
The financial statements have been prepared on a historical cost basis. Historical cost is based on the fair values of the
consideration given in exchange for goods and services.
The financial statements are presented in Australian dollars.
The Company is a listed public Company, incorporated in Australia and operating in Australia. The Group’s principal activities
are gold and base metals exploration.
Adoption of new and revised standards
(b)
Standards and Interpretations applicable to 30 June 2020
In the period ended 30 June 2020, the Directors have reviewed all of the new and revised Standards and Interpretations issued
by the AASB that are relevant to the Group and effective for the current reporting period. As a result of this review, the Directors
have determined that there is no material impact of the new and revised Standards and Interpretations on the Group and,
therefore, no material change is necessary to Group accounting policies. This includes an assessment of AASB 16 Leases.
AASB 16 Leases supersedes AASB 117 Leases. The Group has adopted double AASB 16 from 1 July 2019 which has
resulted in changes in the classification, measurement and recognition of leases. The changes result in almost all leases
where the group is the leasee being recognised on the Statement of Financial Position and removes the former distinction
between ‘operating’ and ‘finance’ leases. The new standard requires recognition of a right-of-use asset (the leased item) and
a financial liability (to pay rentals). The exceptions are short-term leases and leases of low value assets.
The Group has adopted AASB 16 using the modified retrospective approach under which the reclassifications and the
adjustments arising from the new leasing rules are recognised in the opening Condensed Statement of Financial Position on
1 July 2019. Under this approach, there is no initial impact on retained earnings, and comparatives have not been restated.
Impact on adoption of AASB16
All group leases have a term of less than 12 months or relate to low value assets and the Group has applied the optional
exemptions do not capitalise these leases and instead account for the lease expense on a straight-line basis over the lease
term.
Therefore, the adoption of AASB 16 resulted in the recognition of right of use assets of $Nil and lease liabilities of $Nil in
respect of all operating leases.
The net impact on retained earnings of 1 July 2019 was $Nil.
Standards and Interpretations in issue not yet adopted
The Directors have also reviewed all of the new and revised Standards and Interpretations in issue not yet adopted for the
half-year ended 30 June 2020. As a result of this review the Directors have determined that there is no material impact of the
Standards and Interpretations in issue not yet adopted on the Group and, therefore, no change is necessary to Group
accounting policies.
Statement of compliance
(c)
The financial report was authorised for issue on 2 September 2020.
The financial report complies with Australian Accounting Standards, which include Australian equivalents to International
Financial Reporting Standards (AIFRS). Compliance with AIFRS ensures that the financial report, comprising the financial
statements and notes thereto, complies with International Financial Reporting Standards (IFRS).
-47-
Kin Mining NL
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Significant accounting estimates and judgements
(d)
The application of accounting policies requires the use of judgements, estimates and assumptions about carrying values of
assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based
on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions are recognised in the period in which
the estimate is revised if it affects only that period, or in the period of the revision and future periods if the revision affects both
current and future periods.
Mine development expenditure carried forward (included in assets in construction in Note 10)
The recoverability of the carrying amount of mine development expenditure carried forward has been reviewed by the
Directors. In conducting the review, the recoverable amount has been assessed by reference to the higher of “fair value less
costs to sell” and “value in use”. In determining value in use, future cash flows are based on:
Estimates of ore reserves and mineral resources for which there is a high degree of confidence of economic extraction;
Estimated production and sales levels;
Estimate future commodity prices;
Future costs of production;
Future capital expenditure; and/or
Future exchange rates
Variations to expected future cash flows, and timing thereof, could result in significant changes to the impairment test results,
which in turn could impact future financial results.
Mine rehabilitation provision
The Group’s mining and exploration activities are subject to various laws and regulations governing the protection of the
environment. The Group recognises management’s best estimate for asset retirement obligations 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, life of mine estimates and discount rates could affect the carrying amount of this
provision.
Share-based payment transactions
The Group measures the cost of equity-settled transactions by reference to the fair value of the equity instruments at the date
at which they are granted. The fair value is determined using a Black and Scholes model, using the assumptions detailed in
Note 16.
(e)
Going concern
Notwithstanding the fact that the Group incurred an operating loss of $7,242,452 for the year ended 30 June 2020, had net
cash outflow from operating activities of $6,815,591 and investing activities of $258,011 the directors are of the opinion that
the Group is a going concern for the following reasons:
The Company raised an additional $7,446,326 in July 2020.
The Directors anticipate that further equity raisings will be required in the forthcoming year to meet ongoing working capital
and expenditure commitments and are confident of their ability to raise the required funds when required.
Should the equity raisings not be completed, there is a material uncertainty that may cast significant doubt as to whether the
Group will be available to realise its assets and extinguish its liabilities in the normal course of business and at the amount
stated in the financial report.
-48-
Kin Mining NL
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(f)
The consolidated financial statements incorporate the financial statements of the Company and entities controlled by the
Company and its subsidiaries. Control is achieved when the Company:
Basis of consolidation
has power over the investee;
is exposed, or has rights, to variable returns from its involvement in with the investee; and
has the ability to its power to affect its returns.
The Company reassess whether or not it controls an investee if facts and circumstances indicate that there are changes to
one or more of the three elements listed above.
When the Company has less than a majority of the voting rights in an investee, it has the power over the investee when the
voting rights are sufficient to give it the practical ability to direct the relevant activities of the investee unilaterally. The Company
considers all relevant facts and circumstances in assessing whether or not the Company’s voting rights are sufficient to give
it power, including:
the size of the Company’s holding of voting rights relative to the size and dispersion of holdings of the other vote
holders;
potential voting rights held by the Company, other vote holders or other parties; rights arising from other contractual
arrangements; and
any additional facts and circumstances that indicate that the Company has, or does not have, the current ability to direct
the relevant activities at the time that decisions need to be made, including voting patterns at previous shareholder
meetings.
Consolidation of a subsidiary begins when the Company obtains control over the subsidiary and ceases when the Company
loses control of the subsidiary. Specifically income and expenses of a subsidiary acquired or disposed of during the year are
included in the consolidated statement of comprehensive income from the date the Company gains control until the date when
the Company ceases to control the subsidiary.
Changes in the Group’s ownership interest in existing subsidiaries
Changes in the Group’s ownership interest in subsidiaries that do not result in the Group losing control over the subsidiaries
are accounted for as equity transactions. The carrying amounts of the Group’s interests and the non-controlling interests are
adjusted to reflect the changes in their relative interests in subsidiaries. Any difference between the amount paid by which the
non-controlling interests are adjusted and the fair value of the consideration paid or received is recognised directly in equity
and attributed to the owners of the Company.
When the Group loses control of a subsidiary, a gain or loss is recognised in profit or loss and is calculated as the difference
between:
The aggregate of the fair value of the consideration received and the fair value of any retained interest; and
The previous carrying amount of the assets (including goodwill), and liabilities of the subsidiary and any non-controlling
interests.
All amounts previously recognised in other comprehensive income in relation to that subsidiary are accounted for as if the
Group had directly disposed of the related assets or liabilities of the subsidiary (i.e. reclassified to profit and loss or transferred
to another category of equity as specified/permitted by the applicable AASBs). The fair value of any investment retained in the
former subsidiary at the date when control is lost is regarded as the fair value on initial recognition for subsequent accounting
under AASB 9, when applicable, the cost on initial recognition of an investment in an associate or a joint venture.
Revenue recognition
(g)
Revenue is recognised to the extent that control of the good or service has passed and it is probable that the economic benefits
will flow to the Group and the revenue is capable of being reliably measured. The following specific recognition criteria must
also be met before revenue is recognised.
Interest income
Revenue is recognised as the interest accrues (using the effective interest method, which is the rate that exactly discounts
estimated future cash receipts through the expected life of the financial instrument) to the net carrying amount of the financial
asset.
Income tax
(h)
Deferred income tax is provided for on all temporary differences at balance date between the tax base of assets and liabilities
and their carrying amounts for financial reporting purposes.
-49-
Kin Mining NL
Income tax (continued)
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(h)
No deferred income tax will be recognised from the initial recognition of goodwill or of an asset or liability, excluding a business
combination, where there is no effect on accounting or taxable profit or loss. No deferred income tax will be recognised in
respect of temporary differences associated with investments in subsidiaries if the timing of the reversal of the temporary
difference can be controlled and it is probable that the temporary differences will not reverse in the near future.
Deferred tax is calculated at the tax rates that are expected to apply to the period when the asset is realised or liability is
settled. Deferred tax is credited in the statement of comprehensive income except where it relates to items that may be
credited directly to equity, in which case the deferred tax is adjusted directly against equity.
Deferred income tax assets are recognised for all deductible temporary differences, carry forward of unused tax assets and
unused tax losses to the extent that it is probable that future tax profits will be available against which deductible temporary
differences can be utilised.
The amount of benefits brought to account or which may be realised in the future is based on tax rates (and tax laws) that
have been enacted or substantially enacted at the balance date and the anticipation that the Group will derive sufficient future
assessable income to enable the benefit to be realised and comply with the conditions of deductibility imposed by the law.
The carrying amount of deferred tax assets is reviewed at each balance date and only recognised to the extent that sufficient
future assessable income is expected to be obtained. Income taxes relating to items recognised directly in equity are
recognised in equity and not in the statement of comprehensive income.
Tax consolidation legislation
Kin Mining NL and its 100% owned Australian resident subsidiaries have implemented the tax consolidation legislation. Current
and deferred tax amounts are accounted for in each individual entity as if each entity continued to act as a taxpayer on its
own.
Kin Mining NL recognises its own current and deferred tax amounts and those current tax liabilities, current tax assets and
deferred tax assets arising from unused tax credits and unused tax losses which it has assumed from its controlled entities
within the tax consolidated Group.
Assets or liabilities arising under tax funding agreements with the tax consolidated entities are recognised as amounts payable
or receivable from or payable to other entities in the Group. Any difference between the amounts receivable or payable under
the tax funding agreement are recognised as a contribution to (or distribution from) controlled entities in the tax consolidated
Group.
Other taxes
(i)
Revenues, expenses and assets are recognised net of the amount of GST except:
when the GST incurred on a purchase of goods and services is not recoverable from the taxation authority, in which
case the GST is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable;
and
receivables and payables, which are stated with the amount of GST included.
The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables
in the statement of financial position.
Cash flows are included in the statement of cash flows on a gross basis and the GST component of cash flows arising from
investing and financing activities, which is recoverable from, or payable to, the taxation authority are classified as operating
cash flows.
Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the taxation
authority.
Impairment of non-financial assets
(j)
The Group assesses at each reporting date whether there is an indication that an asset may be impaired. If any such indication
exists, or when annual impairment testing for an asset is required, the Group makes an estimate of the asset’s recoverable
amount. An asset’s recoverable amount is the higher of its fair value less costs to sell and its value in use and is determined
for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets
of the Group. In such cases the asset is tested for impairment as part of the cash generating unit to which it belongs. When
the carrying amount of an asset or cash-generating unit exceeds its recoverable amount, the asset or cash-generating unit is
considered impaired and is written down to its recoverable amount.
-50-
Kin Mining NL
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(j)
Impairment of non-financial assets (continued)
In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate
that reflects current market assessments of the time value of money and the risks specific to the asset. Impairment losses
relating to continuing operations are recognised in those expense categories consistent with the function of the impaired asset
unless the asset is carried at revalued amount (in which case the impairment loss is treated as a revaluation decrease).
An assessment is also made at each reporting date as to whether there is any indication that previously recognised impairment
losses may no longer exist or may have decreased. If such indication exists, the recoverable amount is estimated. A previously
recognised impairment loss is reversed only if there has been a change in the estimates used to determine the asset’s
recoverable amount since the last impairment loss was recognised. If that is the case the carrying amount of the asset is
increased to its recoverable amount. That increased amount cannot exceed the carrying amount that would have been
determined, net of depreciation, had no impairment loss been recognised for the asset in prior years. Such reversal is
recognised in profit or loss unless the asset is carried at revalued amount, in which case the reversal is treated as a revaluation
increase.
After such a reversal the depreciation charge is adjusted in future periods to allocate the asset’s revised carrying amount, less
any residual value, on a systematic basis over its remaining useful life.
Cash and cash equivalents
(k)
Cash comprises cash at bank and in hand. Cash equivalents are short term, highly liquid investments that are readily
convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. Bank overdrafts are
shown within borrowings in current liabilities in the statement of financial position.
For the purposes of the statement of cash flows, cash and cash equivalents consist of cash and cash equivalents as defined
above, net of outstanding bank overdrafts.
Property, plant and equipment
(l)
Property, plant and equipment is stated at cost less accumulated depreciation and any accumulated impairment losses. Such
cost includes the cost of replacing parts that are eligible for capitalisation when the cost of replacing the parts is incurred.
Similarly, when each major inspection is performed, its cost is recognised in the carrying amount of the plant and equipment
as a replacement only if it is eligible for capitalisation.
Land and buildings are measured at cost less accumulated depreciation on buildings and less any impairment losses
recognised after the date of the revaluation.
Depreciation is calculated on a straight-line basis over the estimated useful life of the assets as follows:
Buildings
Plant and equipment
Motor Vehicles
Computer equipment
Mine Properties (assets in construction)
5 to 25 years
5 to 20 years
5 years
2 to 3 years
amortised over units of production
The assets' residual values, useful lives and amortisation methods are reviewed, and adjusted if appropriate, at each financial
year end.
Impairment
The carrying values of property, plant and equipment are reviewed for impairment at each balance date, with recoverable
amount being estimated when events or changes in circumstances indicate that the carrying value may be impaired.
The recoverable amount of property, plant and equipment is the higher of fair value less costs to sell and value in use. In
assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that
reflects current market assessments of the time value of money and the risks specific to the asset. For an asset that does not
generate largely independent cash inflows, recoverable amount is determined for the cash-generating unit to which the asset
belongs, unless the asset's value in use can be estimated to approximate fair value.
An impairment exists when the carrying value of an asset or cash-generating unit exceeds its estimated recoverable amount.
The asset or cash-generating unit is then written down to its recoverable amount.
Impairment losses are recognised in the statement of comprehensive income as a separate line item.
An item of property, plant and equipment is derecognised upon disposal or when no further future economic benefits are
expected from its use or disposal.
-51-
Kin Mining NL
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(l)
Derecognition and disposal
Property, plant and equipment (continued)
Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal proceeds and the
carrying amount of the asset) is included in profit or loss in the year the asset is derecognised.
Trade and other receivables
(m)
Trade and other receivables are measured on initial recognition at fair value and are subsequently measured at amortised
cost using the effective interest rate method, less any allowance for impairment. Trade receivables are generally due for
settlement within periods ranging from 15 days to 30 days.
The Group measures the loss allowance for trade and other receivables at an amount equal to lifetime expected credit loss.
The expected credit losses on trade and other receivables are estimated with reference to past default experience of the debtor
and an analysis of the debtor’s current financial position, adjusted for factors that are specific to the debtor, general economic
conditions of the industry in which the debtor operates and an assessment of both the current and the forecast direction of
conditions at the reporting date.
The Group writes off a trade receivable when there is information indicating that the debtor is in severe financial difficulty and
there is no realistic prospect of recovery; for example, when the debtor has been placed under liquidation or has entered into
bankruptcy proceedings, or when the trade receivables are over two years past due, whichever occurs earlier. The impairment
allowance is set equal to the difference between the carrying amount of the receivable and the present value of estimated
future cash flows, discounted at the original effective interest rate. Where receivables are short-term discounting is not applied
in determining the allowance.
The amount of the impairment loss is recognised in the profit or loss with other expenses when a trade receivable for which
an impairment allowance had been recognised becomes uncollectible in subsequent period, it is written off against the
allowance account. Subsequent recoveries of amounts previous written off are credited against other expenses in the profit or
loss.
Inventories
(n)
Gold bullion are physically measured or estimated and stated at the lower of cost and net realisable value. Cost comprises
direct material, direct labour and an appropriate proportion of variable and fixed overhead expenditure, the latter being
allocated on the basis of normal operating capacity. Costs are assigned to individual items of inventory on the basis of weighted
average costs in getting such inventories to their existing location and condition, based on weighted average costs incurred
during the period in which such inventories were produced. Net realisable value is the estimated selling price in the ordinary
course of business, less estimated costs of completion and costs of selling the final product.
Trade and other payables
(o)
Trade payables and other payables are carried at amortised cost and represent liabilities for goods and services provided to
the Group prior to the end of the financial year that are unpaid and arise when the Group becomes obliged to make future
payments in respect of the purchase of these goods and services. Trade and other payables are presented as current liabilities
unless payment is not due within 12 months.
Borrowings
(p)
Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured at
amortised cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognised in
profit or loss over the period of the borrowings using the effective interest method. Fees paid on the establishment of loan
facilities are recognised as transaction costs of the loan to the extent that it is probable that some or all of the facility will be
drawn down. In this case, the fee is deferred until the draw down occurs. To the extent there is no evidence that it is probable
that some or all of the facility will be drawn down, the fee is capitalised as a prepayment for liquidity services and amortised
over the period of the facility to which it relates.
The fair value of the liability portion of a convertible note is determined using a market interest rate for an equivalent non-
convertible note. This amount is recorded as a liability on an amortised cost basis until extinguished on conversion or maturity
of the note. The remainder of the proceeds is allocated to the conversion option. This is recognised and included in
shareholders’ equity, net of income tax effects.
-52-
Kin Mining NL
Borrowings (continued)
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(p)
Borrowings are removed from the statement of financial position when the obligation specified in the contract is discharged,
cancelled or expired. The difference between the carrying amount of a financial liability that has been extinguished or
transferred to another party and the consideration paid, including any non-cash assets transferred or liabilities assumed, is
recognised in profit or loss as other income or finance costs.
Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for
at least 12 months after the reporting period.
Provisions
(q)
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is
probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable
estimate can be made of the amount of the obligation. Provisions are not recognised for future operating losses.
When the Group expects some or all of a provision to be reimbursed, for example under an insurance contract, the
reimbursement is recognised as a separate asset but only when the reimbursement is virtually certain. The expense relating
to any provision is presented in the statement of comprehensive income net of any reimbursement. Provisions are measured
at the present value or management’s best estimate of the expenditure required to settle the present obligation at the end of
the reporting period.
If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects the risks
specific to the liability.
When discounting is used, the increase in the provision due to the passage of time is recognised as an interest expense.
Restoration and rehabilitation
A provision for restoration and rehabilitation is recognised when there is a present obligation as a result of development
activities undertaken, it is probable that an outflow of economic benefits will be required to settle the obligation, and the amount
of the provision can be measured reliably. The estimated future obligations include the costs of abandoning sites, removing
facilities and restoring the affected areas.
The provision for future restoration costs is the best estimate of the present value of the expenditure required to settle the
restoration obligation at the balance date. Future restoration costs are reviewed annually and any changes in the estimate are
reflected in the present value of the restoration provision at each balance date.
The initial estimate of the restoration and rehabilitation provision is expensed in the statement of comprehensive income, or
capitalised if asset recognition criteria are met. Changes in the estimate of the provision for restoration and rehabilitation are
treated in the same manner. The unwinding of the effect of discounting on the provision is recognised as a finance cost.
Employee leave benefits
(r)
Wages, salaries, annual leave and sick leave
Liabilities accruing to employees in respect of wages and salaries, annual leave, long service leave and sick leave expected
to be settled within 12 months of the balance date are recognised in other payables in respect of employees’ services up to
the balance date. They are measured at the amounts expected to be paid when the liabilities are settled. Liabilities for non-
accumulating sick leave are recognised when the leave is taken and are measured at the rates paid or payable.
Liabilities accruing to employees in respect of wages and salaries, annual leave, long service leave and sick leave not expected
to be settled within 12 months of the balance date are recognised in non-current other payables in respect of employees’
services up to the balance date. They are measured as the present value of the estimated future outflows to be made by the
Group.
Long service leave
The liability for long service leave is recognised in the provision for employee benefits and measured as the present value of
expected future payments to be made in respect of services provided by employees up to the balance date. Consideration is
given to expected future wage and salary levels, experience of employee departures, and period of service. Expected future
payments are discounted using market yields at the balance date on national government bonds with terms to maturity and
currencies that match, as closely as possible, the estimated future cash outflows.
Issued capital
(s)
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown
in equity as a deduction, net of tax, from the proceeds. Incremental costs directly attributable to the issue of new shares or
options for the acquisition of a new business are not included in the cost of acquisition as part of the purchase consideration.
-53-
Kin Mining NL
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Earnings/ loss per share
(t)
Basic earnings/loss 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) and preference share dividends, divided by the weighted average number of
ordinary shares, adjusted for any bonus element.
Diluted earnings/loss per share is calculated as net profit/loss attributable to members of the parent, adjusted for:
costs of servicing equity (other than dividends) and preference share dividends;
the after tax effect of dividends and interest associated with dilutive potential ordinary shares that have been recognised
as expenses; and
other non-discretionary changes in revenues or expenses during the period that would result from the dilution of
potential ordinary shares; divided by the weighted average number of ordinary shares and dilutive potential ordinary
shares, adjusted for any bonus element.
Exploration and evaluation
(u)
Exploration and evaluation expenditure is expensed to the profit or loss as incurred except in the following circumstance in
which case the expenditure may be capitalised:
The existence of mineral deposit has been established however additional expenditure is required to determine the
technical feasibility and commercial viability of extraction and it is anticipated that future economic benefits are more
likely than not to be generated as a result of the expenditure.
A regular review is undertaken of each area of interest to determine the appropriateness of continuing to carry forward costs
in relation to that area of interest. An impairment exists when the carrying value of expenditure exceeds its estimated
recoverable amount. The area of interest is then written down to its recoverable amount and the impairment losses are
recognised in the statement of comprehensive income.
The directors believe that this policy results in more relevant and reliable information in the financial report. Exploration and
evaluation assets are inherently uncertain and expensing as incurred results in a more transparent statement of financial
position and statement of profit or loss and comprehensive income. All exploration and evaluation expenditure in the current
period has been expensed to the profit or loss.
Parent entity financial information
(v)
The financial information for the parent entity, Kin Mining NL, disclosed in Note 20 has been prepared on the same basis as
the consolidated financial statements, except as set out below.
Investments in subsidiaries, associates and joint venture entities
Investments in subsidiaries, associates and joint venture entities are accounted for at cost in the parent entity’s financial
statements.
Share-based payments
The grant by the Company of options over its equity instruments to the employees of subsidiary undertakings in the Group is
treated as a capital contribution to that subsidiary undertaking. The fair value of employee services received, measured by
reference to the grant date fair value, is recognised over the vesting period as an increase to investment in subsidiary
undertakings, with a corresponding credit to equity.
Government grants
(w)
Grants from the government are recognised at their fair value where there is a reasonable assurance that the grant will be
received and the Group will comply with all attached conditions.
Government grants relating to costs are deferred and recognised in the statement of profit or loss and other comprehensive
income over the period necessary to match them with the costs that they are intended to compensate.
Government grants relating to the purchase of property, plant and equipment are included in non-current liabilities as deferred
income and are credited to statement of profit or loss and other comprehensive income on a straight-line basis over the
expected lives of the related assets.
Government grants are presented as other income in the statement of profit or loss and other comprehensive income.
Right-of-use assets
(x)
A right-of-use asset is recognised at the commencement date of a lease. The right-of-use asset is measured at cost, which
comprises the initial amount of the lease liability, adjusted for, as applicable, any lease payments made at or before the
commencement date net of any lease incentives received, any initial direct costs incurred, and, except where included in the
cost of inventories, an estimate of costs expected to be incurred for dismantling and removing the underlying asset, and
restoring the site or asset.
-54-
Kin Mining NL
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Right-of-use assets are depreciated on a straight-line basis over the unexpired period of the lease or the estimated useful life
of the asset, whichever is the shorter. Where the Group expects to obtain ownership of the leased asset at the end of the lease
term, the depreciation is over its estimated useful life. Right-of use assets are subject to impairment or adjusted for any
remeasurement of lease liabilities.
The Group has elected not to recognise a right-of-use asset and corresponding lease liability for short-term leases with terms
of 12 months or less and leases of low-value assets. Lease payments on these assets are expensed to profit or loss as
incurred.
(y)
Lease liabilities
A lease liability is recognised at the commencement date of a lease. The lease liability is initially recognised at the present
value of the lease payments to be made over the term of the lease, discounted using the interest rate implicit in the lease or,
if that rate cannot be readily determined, the Group's incremental borrowing rate. Lease payments comprise of fixed payments
less any lease incentives receivable, variable lease payments that depend on an index or a rate, amounts expected to be paid
under residual value guarantees, exercise price of a purchase option when the exercise of the option is reasonably certain to
occur, and any anticipated termination penalties. The variable lease payments that do not depend on an index or a rate are
expensed in the period in which they are incurred.
Lease liabilities are measured at amortised cost using the effective interest method. The carrying amounts are remeasured if
there is a change in the following: future lease payments arising from a change in an index or a rate used; residual guarantee;
lease term; certainty of a purchase option and termination penalties. When a lease liability is remeasured, an adjustment is
made to the corresponding right-of use asset, or to profit or loss if the carrying amount of the right-of-use asset is fully written
down.
(z)
Share-based payments
Equity-settled and cash-settled share-based compensation benefits are provided to employees.
Equity-settled transactions are awards of shares, performance rights or options over shares, that are provided to employees
in exchange for the rendering of services. Cash-settled transactions are awards of cash for the exchange of services, where
the amount of cash is determined by reference to the share price.
The cost of equity-settled transactions are measured at fair value on grant date. Fair value is independently determined using
either the Binomial or Black-Scholes option pricing model that takes into account the exercise price, the term of the option, the
impact of dilution, the share price at grant date and expected price volatility of the underlying share, the expected dividend
yield and the risk free interest rate for the term of the option, together with non-vesting conditions that do not determine whether
the Group receives the services that entitle the employees to receive payment. No account is taken of any other vesting
conditions.
The cost of equity-settled transactions are recognised as an expense with a corresponding increase in equity over the vesting
period. The cumulative charge to profit or loss is calculated based on the grant date fair value of the award, the best estimate
of the number of awards that are likely to vest and the expired portion of the vesting period. The amount recognised in the
statement of profit or loss and other comprehensive income for the period is the cumulative amount calculated at each reporting
date less amounts already recognised in previous periods.
The cost of cash-settled transactions is initially, and at each reporting date until vested, determined by applying either the
Binomial or Black-Scholes option pricing model, taking into consideration the terms and conditions on which the award was
granted. The cumulative charge to profit or loss until settlement of the liability is calculated as follows:
during the vesting period, the liability at each reporting date is the fair value of the award at that date multiplied by
the expired portion of the vesting period.
from the end of the vesting period until settlement of the award, the liability is the full fair value of the liability at the
reporting date.
All changes in the liability are recognised in the statement of profit or loss and other comprehensive income. The ultimate cost
of cash-settled transactions is the cash paid to settle the liability.
Market conditions are taken into consideration in determining fair value. Therefore, any awards subject to market conditions
are considered to vest irrespective of whether or not that market condition has been met, provided all other conditions are
satisfied.
-55-
Kin Mining NL
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
If equity-settled awards are modified, as a minimum an expense is recognised as if the modification has not been made. An
additional expense is recognised, over the remaining vesting period, for any modification that increases the total fair value of
the share-based compensation benefit as at the date of modification.
If the non-vesting condition is within the control of the Group or employee, the failure to satisfy the condition is treated as a
cancellation. If the condition is not within the control of the Group or employee and is not satisfied during the vesting period,
any remaining expense for the award is recognised over the remaining vesting period, unless the award is forfeited.
If equity-settled awards are cancelled, it is treated as if it has vested on the date of cancellation, and any remaining expense
is recognised immediately. If a new replacement award is substituted for the cancelled award, the cancelled and new award
is treated as if they were a modification.
NOTE 2: REVENUE AND EXPENSES
Included in the loss for the year are the following items of revenue and expenses:
Revenue
Other income:
Government grants
Other income
Expenses
Effective interest – royalty1
Interest expense1
Lease expense
Amortisation of transaction costs
1See Note 14
NOTE 3: INCOME TAX
2020
$
2019
$
50,000
3,360
53,360
-
38,108
38,108
2020
2019
$
$
-
-
46,167
-
46,167
(369,231)
356,355
74,593
1,690,041
1,751,758
The prima facie income tax expense on pre-tax accounting loss from operations reconciles to the income tax expense in the
financial statements as follows:
Loss before income tax
Income tax expense calculated at 30% (2018: 30%)
Tax effect of amounts which are not deductible/(taxable) in
calculating taxable loss:
Effect of expenses that are not deductible in determining
taxable loss
Effect of unused tax losses and tax offsets not recognised as
deferred tax assets
Income tax benefit reported in the consolidated statement of profit or
loss and comprehensive income
2020
$
2019
$
(7,242,452)
(14,555,272)
(2,172,736)
(4,366,582)
62,114
73,017
2,110,622
4,293,565
-
-
The tax rate used in the above reconciliation is the corporate tax rate of 30% payable by Australian corporate entities on
taxable profits under Australian tax law. There has been no change in this tax rate since the previous reporting period.
-56-
Kin Mining NL
The Company and its subsidiaries are part of an income tax consolidated group. The Company’s unused tax losses arising in
Australia including the current year losses is $15,545,125 (2019: $13,434,503). These tax losses are available indefinitely for
offset against future taxable profits, subject to the Company passing the regulatory tests for continued use of the tax losses.
NOTE 4: SEGMENT REPORTING
Operating segments are identified on the basis of internal reports about components of the Group that are reviewed by the
chief operating decision maker (deemed to be the Board of Directors) in order to allocate resources to the segment and
assess its performance. During the period, the Group operated predominantly in one business and geographical segment
being mineral exploration in Australia. Accordingly, under the “management approach” outlined, only one operating segment
has been identified and no further disclosure is required in the notes.
NOTE 5: LOSS PER SHARE
Basic/diluted loss per share
2020
Cents per
share
2019
Cents per
share
(1.30)
(3.70)
The loss and weighted average number of ordinary shares used in the calculation of basic/diluted loss per share is as follows:
Loss for the year
Weighted average number of ordinary shares for the purpose
of basic/dilutive earnings per share
$
(7,242,452)
$
(14,555,272)
555,441,646
393,768,617
The potential ordinary shares that could be dilutive in the future are the options discussed at Note 16.
NOTE 6: DIVIDENDS
No dividends have been paid or declared since the start of the financial year and the directors do not recommend the payment
of a dividend in respect of the financial year.
-57-
Kin Mining NL
NOTE 7: CASH AND CASH EQUIVALENTS
Reconciliation to the Statement of Cash Flows:
For the purposes of the statement of cash flows, cash and cash equivalents comprise cash on hand and at bank and
investments in money market instruments, net of outstanding bank overdrafts.
Cash and cash equivalents as shown in the statement of cash flows is reconciled to the related items in the statement of
financial position as follows:
Cash at bank and on hand
Short-term deposits
2020
$
2019
$
1,635,997
30,000
1,665,997
3,118,063
30,000
3,148,063
Cash at bank earns interest at floating rates based on daily bank deposit rates.
Short-term deposits are made for varying periods of between one day and 3 months, depending on the immediate cash
requirements of the Group, and earn interest at the respective short-term deposit rates.
Reconciliation of net loss for the year to net cash flows from operating activities
Net loss for the year
Depreciation of non-current assets
Loss on sale of plant and equipment
Amortisation of finance transaction costs
Foreign exchange
Effective interest - royalty
Purchase of tenements (expensed)
Share based payment
Impairment expense
(Increase)/decrease in assets:
Trade and other receivables
Increase/(decrease) in liabilities:
Trade and other payables
Provisions
Net cash outflow from operating activities
2020
$
(7,242,452)
266,030
94,696
-
-
-
30,000
10,049
-
2019
$
(14,555,272)
326,083
-
1,690,041
130,164
(369,231)
-
-
1,768,254
1,082
781,504
25,004
(6,815,591)
(727,038)
-
(10,955,495)
NOTE 7: CASH AND CASH EQUIVALENTS (CONTINUED)
Changes in liabilities arising from financing activities
-58-
Prior Year
Balance as at 30 June 2018
Repayments of borrowings
Exchange differences
Effective interest - royalty
Amortisation of transaction costs
Balance as at 30 June 2019
Current Year
Repayments of borrowings
Balance as at 30 June 2020
NOTE 8: TRADE AND OTHER RECEIVABLES
Other debtors (GST)
Other debtors
Other debtors (ATO receivable and fuel credits refundable)
Aging of past due but not impaired
There are no past due amounts at the reporting date.
NOTE 9: OTHER ASSETS
Current
Prepayment – others
Kin Mining NL
Sprott Credit
Facility
$
5,431,384
Total
$
5,431,384
(6,882,357)
(6,882,357)
130,164
(369,231)
1,690,041
1
130,164
(369,231)
1,690,041
1
-
1
-
1
2020
$
2019
$
28,071
-
-
28,071
34,648
17,016
1,082
52,746
2020
$
2019
$
39,280
39,280
25,906
25,906
NOTE 10: PROPERTY, PLANT AND EQUIPMENT
-59-
Kin Mining NL
Freehold
land and
buildings
$
2,909,980
113,357
-
(36,880)
-
2,986,457
-
-
(42,332)
2,944,125
Assets in
construction
Plant and
equipment
Motor Vehicles
Total
$
$
$
$
8,176,970
31,926
-
-
(1,768,254)
6,440,642
374,907
-
-
6,815,549
601,871
73,869
-
(132,410)
-
543,330
30,561
(63,325)
(103,505)
407,061
740,973
-
-
(156,793)
-
12,429,794
219,152
-
(326,083)
(1,768,254)
584,180
10,554,609
6,470
(253,723)
(120,193)
216,734
411,938
(317,048)
(266,030)
10,383,469
Balance at 1 July 2018
Additions
Disposal
Depreciation charge for the year
Impairment expense
Balance at 30 June 2019
Additions
Disposal
Depreciation charge for the year
Balance at 30 June 2020
The useful life of the assets was estimated as follows for both 2020 and 2019:
Buildings
Plant and equipment
Motor vehicles
Computer equipment
5 to 25 years
5 to 20 years
5 years
2 to 3 years
NOTE 11: EXPLORATION AND EVALUATION EXPENDITURE
Exploration and evaluation phase – at cost
Cumulative exploration and evaluation at beginning of year
Expenditure incurred - cash
Cumulative exploration and evaluation expenditure at the end of
the year
2020
2019
$
$
33,324,867
5,062,192
24,957,894
8,366,973
38,387,059
33,324,867
Exploration and evaluation expenditure expensed to the statement
of profit or loss and comprehensive income in the current period
(5,062,192)
(8,366,973)
Exploration and evaluation expenditure carried forward on the
statement of financial position
-
-
-60-
Kin Mining NL
NOTE 12: TRADE AND OTHER PAYABLES
Current
Trade payables (i)
Other payables and accrued expenses
Annual leave
2020
$
2019
$
397,773
353,050
113,763
864,586
565,586
145,830
176,810
888,226
(i)
Trade payables are non-interest bearing and are normally settled on 30-day terms.
NOTE 13: PROVISIONS
Non-Current
Restoration and rehabilitation provision
2020
$
2019
$
1,500,000
1,500,000
1,500,000
1,500,000
Kin has an obligation to certain rehabilitation activities from historical exploration and mining activities. A closure cost estimate
for these activities has been prepared as follows:
Calculation of required provision
All historical areas of disturbance have been incorporated in this calculation.
Each historical disturbance has been planned for the type of activities to complete the rehabilitation of that
disturbance.
The unit rates used to estimate the cost of rehabilitation for each type of rehabilitation activity has not changed from
the prior years’ estimate.
The 2019 PFS document assumed that a large number of the unit rates have refined to lower rates than were used
previously. For example, applying the unit rates from the 2019 PFS to the rehabilitation activities on the Mining
Infrastructure (Mertondale Pit and WRL rehabilitation) would result in a reduction of $0.151M or 27% from the
previous estimate.
The 2019 PFS costings are based on a LOM operation and mining contractor presence while the current
rehabilitation provision (assuming no LOM operation) will involve local Leonora operators.
The provision though relating to historical activities is not current as it is anticipated that the rehabilitation will not
occur until throughout and at the end of the proposed mine life. The 2019 PFS envisages an 8-year LOM slightly
longer than the 2017 DFS LOM of 7 years.
The provision is adequately and appropriately estimated at $1.5M.
Current exploration areas are rehabilitated at the end of the exploration program (within 6 months in accordance with
POW conditions).
The closure costs have been discounted using an 8% discount rate.
NOTE 14: BORROWINGS
Current
Secured
Sprott Credit Facility (i)
Total borrowings
Summary of borrowing arrangements
-61-
Kin Mining NL
2020
$
2019
$
1
1
1
1
1
1
(i) The Company entered into a credit agreement (original credit facility) with Sprott Private Resource Lending (Collector),
LP (Sprott) to provide a USD$27M senior secured credit facility to be used for the construction of the 100% owned Leonora
Gold Project in December 2017. Prior to 31 December 2019 the loan facility from Sprott Private Resource Lending
(Collector), LP was withdrawn by Sprott due to a closure of the Sprott financing fund. The Company still owes $1 which will
be settled on cancellation of the documentation.
NOTE 15: ISSUED CAPITAL
2020
$
2019
$
Ordinary shares issued and fully paid
68,455,189
62,863,653
Ordinary shares entitle the holder to participate in dividends and the proceeds on winding up of the Company in proportion to
the number of and amounts paid on the shares held.
On a show of hands every holder of ordinary shares present at a meeting in person or by proxy, is entitled to one vote, and
upon a poll each share is entitled to one vote.
Ordinary shares have no par value and the Company does not have a limited amount of authorised capital.
Movement in ordinary shares on issue
Movements in ordinary shares
Balance at beginning of year
Rights issues
Placement of shares
Share issue costs
Balance at end of year
2020
2019
No.
$
No.
$
483,371,337
62,863,653 243,547,933
43,175,285
63,447,130
2,220,649
197,823,404
18,261,352
82,872,368
3,487,200
42,000,000
2,100,000
-
(116,313)
-
(672,984)
629,690,835
68,455,189 483,371,337
62,863,653
NOTE 16: OPTIONS AND PERFORMANCE RIGHTS
Movement in options on issue
2020
2019
No.
Weighted average
exercise price
$
No.
Weighted average
exercise price
$
Balance at the beginning of the year
Options cancelled on expiry (i)
Balance at the end of the year (ii)
25,000,000
(6,000,000)
19,000,000
0.778
0.285
0.934
37,335,750
(12,335,750)
25,000,000
0.653
0.400
0.778
i.
12,335,750 Unlisted Options issued as part of Share Purchase Plan and Shareholder Approval exercisable at
$0.40 by 31 March 2019 expired unexercised. 1,000,000 Unlisted options with an exercise price of $0.36 expired
unexercised on 15 January 2020. An additional 5,000,000 Unlisted options with an exercise price of $0.27 expired
unexercised on 10 April 2020.
ii. The share options outstanding at the end of the year had an exercise price between $0.75 and $1.25 and a
weighted average remaining contractual life of 346 days.
NOTE 16: OPTIONS AND PERFORMANCE RIGHTS (cont)
Movement in performance rights on issue
-62-
Kin Mining NL
2020
2019
No.
Value of
performance
rights
$
No.
Value of
performance
rights
$
Issued to Director
Issued to employees
264,443
-
10,049
-
-
-
-
-
Mr Andrew Munckton has Long Term Incentives (LTI) included in his employment contract. In November 2019 the
shareholders agreed to grant LTI’s in the form of performance rights to Mr Andrew Munckton in three tranches over three
years as follows:
Tranche
Performance Period
Maximum allocation of long term incentives
Tranche 1
1 July 2019 – 30 June 2020
Tranche 2
1 July 2020 – 30 June 2021
Tranche 3
1 July 2021 – 30 June 2022
$32,500
$32,500
$32,500
The Performance Rights, subject to meeting the Performance Measures, vest into shares in the Company in accordance with
the following formula.
Number of shares =
Volume Weighted Average Price (VWAP) of the Company’s shares over the 10 days
on which trading in the Employer’s shares occurred leading up to and including the
day prior to the vesting date
$ value of the Performance Rights
The Performance Rights will vest on satisfaction of the following performance conditions.
The Board will have the unfettered and absolute right to determine and confirm whether vesting conditions have been met in
respect of each and all tranches. In making its determination the Board will recognise the relevant tranche objective at the
end of the applicable vesting period and have regard to implementation of the Business Plan, as well as other proposals
endorsed by the Board as part of its ongoing review of strategy.
Vesting conditions will be a shareholder aligned measure (Total Shareholder Return – TSR).
Vesting of each Tranche will be measured in absolute terms and relative terms against a defined peer group approved by the
Board which is reflective of companies in the same industry with similar issues in respect of organisational size, market
capitalisation, geography, life cycle and project complexity as shown in the table below.
NOTE 16: OPTIONS AND PERFORMANCE RIGHTS (cont)
Tranche1
Vesting conditions (Tranche Objective)
-63-
Tranche 1
Tranche 2
Tranche 3
Company’s Absolute TSR
Company’s TSR relative to Peers
Company’s Absolute TSR
Company’s TSR relative to Peers
Company’s Absolute TSR
Company’s TSR relative to Peers
Kin Mining NL
Weighting
50%
50%
50%
50%
50%
50%
1) The number of Performance Rights to be granted is calculated by dividing each $32,500 tranche by the VWAP of
the Company’s Shares over the 10 days on which trading in the Company’s Shares occurred leading up to and
including the day prior to the vesting date.
After the end of the current financial year (year to 30 June 2020) the Board determined that the vesting conditions for Tranche
1 had been met and 264,443 shares were issued to Mr Munckton on 16 July 2020 following the issue of and exercise of
Tranche 1 Performance Rights.
The value of performance rights issued during the period is determined based on the VWAP of the underlying share price on
the date that the shareholders approved of the issue times the number of shares that were ultimately issued when the
performance rights vested.
Performance rights and cash bonuses have been granted to Mr Stephen Jones that vest and may be converted to shares
following the achievement of future performance hurdles as follows:
Performance Hurdles
Conditions
Capital Expenditure on CGP is within
10% of budget
First Month of gold production
exceeding 4,000 fine ounces output
from the CGP
Steady State production at design
throughput of the CGP mill
Budget and contingency to be determined from the DFS
with allocation and cash payment made within 1 month
following internal accounts demonstrating the milestone
Allocation and cash payment made within 1 month
following the milestone
Six months commercial production having achieved
design throughput and gold output with allocation and
cash payment made within 1 month following the
milestone
Stephen Jones
Performance
Rights *
Cash Bonus
$50,000
$25,000
$50,000
$25,000
$50,000
$25,000
* Performance Rights will, subject to meeting the Performance Hurdles, vest into shares in the Employer in accordance with the following formula.
Number of shares =
Volume Weighted Average Price (VWAP) of the Employer’s shares over the 5 days on which trading in the
Employer’s shares occurred leading up to and including the day prior to the vesting date
$ value of the Performance Rights
Performance rights and cash bonuses have been granted to Mr Glenn Grayson that vest and may be converted to shares
following the achievement of future performance hurdles as follows:
Performance Hurdles
Conditions
Discover sufficient resources to improve the
mill head grade in first 12 months of production
to 1.8 g/t Au prior to start of mining
Increase LGP resources to 1.5Moz in line with
industry average $/resource oz
Increase LGP resources to 2Moz in line with
industry average $/resource oz
Allocation and cash payment made within 1
month following the milestone
Allocation and cash payment made within 1
month following the milestone
Allocation and cash payment made within 1
month following the milestone
Glenn Grayson
Performance
Rights *
Cash Bonus
$100,000 $50,000
$100,000 $50,000
$100,000 $50,000
$300,000 $150,000
-64-
Kin Mining NL
NOTE 17: FINANCIAL INSTRUMENTS
Capital risk management
The Group manages its capital to ensure that entities in the Group will be able to continue as a going concern while maximising
the return to stakeholders through the optimisation of the debt and equity balance.
The Group’s overall strategy remains unchanged from 2019. The capital structure of the Group consists of debt, cash and
cash equivalents and equity attributable to equity holders of the parent, comprising issued capital, reserves and retained
earnings.
None of the Group’s entities are subject to externally imposed capital requirements.
Operating cash flows are used to maintain and expand operations, as well as to make routine expenditures such as tax,
dividends and general administrative outgoings.
Gearing levels are reviewed by the Board on a regular basis in line with its target gearing ratio, the cost of capital and the risks
associated with each class of capital.
Categories of financial instruments
Financial assets
Cash and cash equivalents
Other financial assets
Financial liabilities
Trade and other payables
Borrowings
Other financial liabilities
2020
$
2019
$
1,665,997
-
1,665,997
397,773
1
466,813
864,587
3,148,063
18,098
3,166,161
565,586
1
322,640
888,227
The fair values of the Company’s financial assets and liabilities approximate their carrying values.
Financial risk management objectives
The Group is exposed to market risk (including currency risk, fair value interest rate risk and price risk), credit risk, liquidity risk
and cash flow interest rate risk.
The Group seeks to minimise the effect of these risks, where the risk is significant to the performance of the Group, by using
derivative financial instruments to hedge these risk exposures. The use of financial derivatives is governed by the Group’s
policies approved by the board of directors, which provide written principles on foreign exchange risk, interest rate risk, credit
risk, the use of financial derivatives and non-derivative financial instruments, and the investment of excess liquidity.
Compliance with policies and exposure limits is reviewed by management on a continuous basis. The Group does not enter
into or trade financial instruments, including derivative financial instruments, for speculative purposes.
Market risk
The Company is not materially impacted by market risk other than share price risk related to future capital raisings.
There has been no other change to the Company’s exposure to market risks or the manner in which it manages and measures
the risk from the previous period.
Interest rate risk management
The Company and the Group are exposed to interest rate risk as entities in the Group borrow funds at both fixed and floating
interest rates. The Group does not consider floating rate borrowings to be material.
Equity price risk
The Company is not exposed to any equity price risk as it has no investments in such assets.
Credit risk management
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Group.
The Group has adopted a policy of only dealing with creditworthy counterparties and obtaining sufficient collateral where
appropriate, as a means of mitigating the risk of financial loss from defaults. The Group only transacts with entities that are
rated the equivalent of investment grade and above. This information is supplied by independent rating agencies where
available and, if not available, the Group uses publicly available financial information and its own trading record to rate its
major customers. The Group’s exposure and the credit ratings of its counterparties are continuously monitored and the
-65-
Kin Mining NL
NOTE 17: FINANCIAL INSTRUMENTS (cont)
aggregate value of transactions concluded is spread amongst approved counterparties. Credit exposure is controlled by
counterparty limits that are reviewed and approved by the risk management committee annually.
The Group does not have any significant credit risk exposure to any single counterparty or any Group of counterparties having
similar characteristics. The credit risk on liquid funds and derivative financial instruments is limited because the counterparties
are banks with high credit ratings assigned by international credit rating agencies.
The carrying amount of financial assets recorded in the financial statements, net of any allowance for losses, represents the
Group’s maximum exposure to credit risk without taking account of the value of any collateral obtained.
Liquidity risk management
Ultimate responsibility for liquidity risk management rests with the board of directors, who have built an appropriate liquidity
risk management framework for the management of the Group’s short, medium and long-term funding and liquidity
management requirements. The Group manages liquidity risk by maintaining adequate reserves, banking facilities and reserve
borrowing facilities by continuously monitoring forecast and actual cash flows and matching the maturity profiles of financial
assets and liabilities.
Fair value measurement
Financial assets and financial liabilities measured at fair value in the statement of financial position are grouped into three
levels of a fair value hierarchy.
The Sprott Credit Facility (soon to be released) is a level 3 in the fair value hierarchy. The fair value is impacted by the
estimated timing of the cashflows and the future gold price.
Valuation techniques are selected based on the characteristics of each instrument, with the overall objective of maximising
the use of market-based information. The finance team reports directly with the Board. Valuation processes and fair value
changes are discussed among the Board at least every year, in line with the Group’s reporting dates.
The fair value of the Sprott Credit Facility is estimated using a present value technique. There was no change in fair value of
the Sprott Credit Facility based on the change in timing of cashflows and the future gold price from first draw down to 30 June
2020.
The following table details the Company’s and the Group’s expected contractual maturity for its non-derivative financial
liabilities. These have been drawn up based on undiscounted contractual maturities of the financial liabilities based on the
earliest date the Group can be required to repay. The tables include both interest and principal cash flows.
30 June 2020
Trade and other payables
Borrowings – interest bearing
30 June 2019
Trade and other payables
Borrowings – interest bearing
Weighted
average
interest
rate
%
-
(a)
-
Weighted
average
interest
rate
%
-
(a)
Less than
1 month
$
864,586
-
864,586
1 – 3
months
$
-
-
-
3 months –
1 year
$
-
1
1
1 – 5 years
$
-
-
-
5+ years
$
-
-
-
Less than
1 month
$
888,226
-
888,226
1 – 3
months
$
3 months –
1 year
$
1 – 5 years
$
5+ years
$
-
-
-
-
1
1
-
-
-
-
-
-
(a) The annual interest rate is 8.00%, plus the greater of US 12-month LIBOR or 1.00%
-66-
Kin Mining NL
NOTE 18: COMMITMENTS AND CONTINGENCIES
Exploration expenditure commitments
The Group has certain commitments to meet minimum expenditure requirements on the mineral exploration assets it has an
interest in. Outstanding exploration commitments are as follows:
Within one year
After one year but not more than five years
More than five years
2020
$
2019
$
2,892,700
-
-
2,892,700
2,861,300
-
-
2,861,300
Contingencies
The company has entered into various agreements that include royalty obligations in the event that certain parameters are
achieved. These parameters are production based such that the royalty is only paid when production is made.
Other than discussed above the Company has no further contingent liabilities or assets for the years ended 30 June 2020 or
30 June 2019.
NOTE 19: RELATED PARTY DISCLOSURE
The consolidated financial statements include the financial statements of Kin Mining NL and the subsidiaries listed in the
following table.
% Equity interest
Parent Investment
Navigator Mining Pty Ltd
Leonora Gold Plant Holdings Pty Ltd
Leonora Gold Plant Pty Ltd
Kin East Pty Ltd
Kin West WA Pty Ltd
Kin Tenement Holdings Pty Ltd
Country of
incorporation
Australia
Australia
Australia
Australia
Australia
Australia
2020
%
100
100
100
100
100
100
2019
%
100
100
100
100
100
100
2020
$
32,779,636
864
11,102,845
2,813,250
4,309,783
610
2019
$
28,863,297
517
10,725,550
2,524,023
3,635,272
263
Kin Mining NL is the ultimate Australian parent entity and ultimate parent of the Group.
Balances and transactions between the Company and its subsidiaries, which are related parties of the Company, have been
eliminated on consolidation and not disclosed in this note. Details of transactions between the Group and other related entities
are disclosed below.
Other transactions with related parties
Pathways Corporate Pty Ltd, a company of which Mr. Graziano is a Director, charged the Group director fees of $45,084
(2019: $36,000), excluding GST, none of which was outstanding at 30 June 2020 (2019: Nil). No interest was payable or
accrued.
NOTE 20: PARENT ENTITY DISCLOSURES
-67-
Financial position
Assets
Current assets
Non-current assets
Total assets
Liabilities
Current liabilities
Non-current liabilities
Total liabilities
Equity
Issued capital
Share based payment reserve
Accumulated losses
Total equity
Financial performance
Loss for the year
Other comprehensive income
Total comprehensive loss
Kin Mining NL
2020
$
2019
$
1,733,348
70,346
1,803,694
3,226,715
133,239
3,359,954
783,257
1
783,258
857,498
1
857,499
68,455,189
1,828,537
(69,263,289)
1,020,437
62,863,653
1,818,488
(62,179,686)
2,502,455
2020
$
(7,083,603)
-
(7,083,603)
2019
$
(4,103,716)
-
(4,103,716)
The Parent Entity (Kin Mining NL) has no commitments or contingencies other than as disclosed in these Notes to the
Consolidated Financial Statements.
NOTE 21: AUDITOR’S REMUNERATION
The auditor of Kin Mining NL is HLB Mann Judd.
Auditor of the parent entity
Audit or review of the consolidated financial statements
2020
$
2019
$
36,500
36,500
51,000
51,000
NOTE 22: KEY MANAGEMENT PERSONNEL
The aggregate compensation made to key management personnel of the Group is set out below:
Short-term employee benefits
Post-employment benefits
Share based payments
2020
$
2019
$
1,579,922
111,542
10,049
1,701,513
1,472,776
124,501
-
1,597,277
-68-
Kin Mining NL
NOTE 23: SUBSEQUENT EVENTS
On 14 July 2020, the Company announced that it had closed the Rights Issue that opened on announced on 22 June 2020.
The Rights Issue closed with the issue of 55,147,263 new shares for proceeds of $6,066,199 (before costs). On 20 July 2020
Kin issued a further 12,546,610 new shares for proceeds of $1,380,127 (before costs) and had agreed to issue a further
2,329,639 shares ($256,260) subject to receiving FIRB approval. Subject to FIRB approval the Company will have raised
$7,702,587 (before costs) which will enable the Company to proceed with its exploration activities.
On 16 July 2020 the Company issued 264,443 shares to Mr Andrew Munckton as shares on exercise of Performance Rights.
The Performance Rights vested on 9 July 2020 when the Companies Directors determined that the performance criteria
required to be met for the vesting of the Performance Rights had been met. At the same time the Directors determined that
Mr Munckton had met the performance criteria required to achieve his Short Term Incentive (STI) payments and authorised
the payment of an STI for the 2019/20 year of $146,000.
-69-
Kin Mining NL
DIRECTORS’ DECLARATION
1.
In the opinion of the directors of Kin Mining NL (the ‘Company’):
a.
the accompanying financial statements and notes are in accordance with the Corporations Act 2001 including:
i.
ii.
giving a true and fair view of the Group’s financial position as at 30 June 2020 and of its performance for
the year then ended; and
complying with Australian Accounting Standards, the Corporations Regulations 2001, professional
reporting requirements and other mandatory requirements.
b.
c.
there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become
due and payable.
the financial statements and notes thereto are in accordance with International Financial Reporting Standards
issued by the International Accounting Standards Board.
2.
This declaration has been made after receiving the declarations required to be made to the directors in accordance
with Section 295A of the Corporations Act 2001 for the financial year ended 30 June 2020.
This declaration is signed in accordance with a resolution of the board of directors.
Managing Director
Dated this 2nd day of September 2020
-70-
INDEPENDENT AUDITOR’S REPORT
To the members of Kin Mining NL
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Kin Mining NL (“the Company”) and its controlled entities
(“the Group”), which comprises the consolidated statement of financial position as at 30 June 2020,
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:
a) giving a true and fair view of the Group’s financial position as at 30 June 2020 and of its
financial performance for the year then ended; and
b) 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 believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Material uncertainty related to going concern
We draw attention to Note 1(e) in the financial report, which indicates that a material uncertainty
exists that may cast significant doubt on the entity’s ability to continue as a going concern. Our
opinion is not modified in respect of this matter.
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. In addition to the matter described in the Material
Uncertainty Related to Going Concern section, we have determined the matters described below
to be the key audit matters to be communicated in our report.
-71-
Key Audit Matter
How our audit addressed the key audit
matter
Carrying Value of the Cardinia Gold Project (“CGP”)
Refer to Note 10.
The CGP assets include property, plant and
equipment with a carrying value of $9.7 million and
represent a significant asset to the Group.
We considered it necessary to assess whether facts
and circumstances existed to suggest that the carrying
amount of the CGP assets may exceed its recoverable
amount.
Our procedures included but were not
limited to:
- We obtained an understanding of the
key processes associated with
management’s review of the carrying
values;
- We considered the Directors’
assessment of potential indicators of
impairment;
- We enquired with management,
reviewed ASX announcements and
reviewed minutes of Directors’
meetings; and
- We assessed the appropriateness of
the disclosures included in the financial
report.
Information other than the financial report and auditor’s report thereon
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 2020, but does not
include the financial report and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not
express any form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of the directors for the financial report
The directors of the Company are responsible for the preparation of the financial report that gives
a true and fair view in accordance with Australian Accounting Standards and the Corporations Act
2001 and for such internal control as the directors determine is necessary to enable the preparation
of the financial report that gives a true and fair view and is free from material misstatement, whether
due to fraud or error.
In 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.
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
-72-
that an audit conducted in accordance with 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.
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional
judgement and maintain professional scepticism throughout the audit. We also:
-
Identify and assess the risks of material misstatement of the financial report, whether due to
fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not
detecting a material misstatement resulting from fraud is higher than for one resulting from
error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the
override of internal control.
-
-
- Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing
an opinion on the effectiveness of the Group’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by the directors.
Conclude on the appropriateness of the directors’ use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to
events or conditions that may cast significant doubt on the Group’s ability to continue as a
going concern. If we conclude that a material uncertainty exists, we are required to draw
attention in our auditor’s report to the related disclosures in the financial report or, if such
disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit
evidence obtained up to the date of our auditor’s report. However, future events or conditions
may cause the Group to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial report, including the
disclosures, and whether the financial report represents the underlying transactions and
events in a manner that achieves fair presentation.
-
We communicate with the directors regarding, among other matters, the planned scope and timing
of the audit and significant audit findings, including any significant deficiencies in internal control
that we identify during our audit.
We also provide the directors with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other
matters that may reasonably be thought to bear on our independence, and where applicable,
related safeguards.
From the matters communicated with the directors, we determine those matters that were of most
significance in the audit of the financial report of the current period and are therefore the key audit
matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter
should not be communicated in our report because the adverse consequences of doing so would
reasonably be expected to outweigh the public interest benefits of such communication.
-73-
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included within the directors’ report for the year ended
30 June 2020.
In our opinion, the Remuneration Report of Kin Mining NL for the year ended 30 June 2020
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
HLB Mann Judd
Chartered Accountants
Perth, Western Australia
2 September 2020
D I Buckley
Partner
Kin Mining NL
1. Shareholding
-74-
(a) Distribution schedule and number of holders of equity securities at 31 August 2020
1 -1,000
1,001 -
5,000
5,001 –
10,000
10,001 –
100,000
100,001
and over
Total
Fully Paid Ordinary Shares (KIN)
163
187
254
851
404
1,859
Unlisted Options – 75c 15/09/20
Unlisted Options – $1.00 15/09/21
Unlisted Options – $1.25 15/09/22
-
-
-
-
-
-
-
-
-
-
-
-
6
4
4
6
4
4
The number of holders holding less than a marketable parcel of fully paid ordinary shares at 31 August 2020 is
292.
(b) 20 largest holders of quoted equity securities as at 31 August 2020
The names of the twenty largest holders of fully paid ordinary shares (ASX Code: KIN) as at 31 August 2020
Rank Name
1 DELPHI UNTERNEHMENSBERATUNG AKTIENGESELLSCHAFT
2 HARMANIS HOLDINGS PTY LTD
3 MOSTIA DION NOMINEES PTY LTD
4 HARMANIS HOLDINGS PTY LTD
5 MACS AUSTRALIA GROUP PTY LTD
6 BNP PARIBAS NOMINEES PTY LTD HUB24 CUSTODIAL SERV LTD DRP
7
IPARKS PROPERTY GROUP PTY LTD
8 TREVOR JOHN DIXON
9 FELICE FINALE PTY LTD
10
JUDITH GOORJIAN
11 GIUSEPPE PAOLO GRAZIANO
12 MR LUIGI ANTONIO D'ADAMO + MR DOMENIC LEO D'ADAMO
13 MITCHELL FAMILY INVESTMENTS (QLD) PTY LTD
14 BOTSIS HOLDINGS PTY LTD
15 MR MARVYN JOHN FITTON
16 MR JOSEPHUS ANTONIO GROOT
17 ERNIO EOLINI
18 HARMANIS HOLDINGS PTY LTD
19 HARMANIS HOLDINGS PTY LTD
20 HARMANIS HOLDINGS PTY LTD
Number
Percentage
157,833,667
22.62
69,516,430
46,600,000
42,673,205
24,954,469
19,450,471
16,363,639
12,300,000
10,666,667
9,090,909
7,372,320
6,356,000
6,262,840
5,714,286
5,274,472
4,815,642
4,747,100
4,596,380
4,328,627
4,182,003
9.96
6.68
6.12
3.58
2.79
2.35
1.76
1.53
1.30
1.06
0.91
0.90
0.82
0.76
0.69
0.68
0.66
0.62
0.60
Total
463,099,127
66.38
-75-
Kin Mining NL
(c) Substantial Shareholders
Holder
1 Delphi Unterehmensberatung Aktiengesellschaft
2 Harmanis Holdings Pty Ltd
3 Mostia Dion
4 Michele Canci
Shares
Percent
157,833,667
22.63
125,296,645
17.96%
58,978,520
8.45%
43,540,330
6.24%
(d) Unquoted Securities
The number of unquoted securities on issue at 31 August 2020:
Unquoted Securities
Number on Issue
Exercise Price
Expiry Date
Unquoted Options
Unquoted Options
Unquoted Options
9,000,000
6,000,000
4,000,000
75c
$1.00
$1.25
15/9/20
15/9/21
15/9/22
(e) Voting Rights
Each fully paid ordinary share carries the rights of one vote per share.
(f) Restricted Securities
There are no restricted securities under ASX imposed escrow.
(g) On-Market Buy-Back
There is currently no on-market buy-back in place.
-76-
Kin Mining NL
TENEMENT INFORMATION AS REQUIRED BY LISTING RULE 5.3.3
REDCASTLE
65 kms South West of Laverton
Change
During Quarter
Tenement ID
M39/1108
P39/5267
P39/6118
Ownership
at end of Quarter
100%
100%
100%
Change
During Quarter
MURRIN MURRIN
50 kms East of Leonora
Ownership
at end of Quarter
66.66%
100%
0%
0%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
Tenement ID
M39/279
M39/1121
M39/1136
M39/1141
P39/5112
P39/5113
P39/5176
P39/5177
P39/5178
P39/5179
P39/5180
P39/5861
P39/5862
P39/5863
P39/5864
MT FLORA
50 kms East North East of Leonora
Tenement ID
M39/1118
P39/5859
P39/5860
Ownership
at end of Quarter
100%
100%
100%
Change
During Quarter
RANDWICK
45 kms North East of Leonora
Change
During Quarter
Ownership
at end of Quarter
100%
0%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
0%
0%
0%
0%
0%
0%
Tenement ID
M37/1316
M37/1343
P37/8000
P37/8965
P37/8966
P37/8967
P37/8968
P37/8969
P37/8970
P37/8971
P37/8972
P37/8973
P37/9320
P37/9321
P37/9322
P37/9323
P37/9324
P37/9325
-77-
Kin Mining NL
DESDEMONA
20 kms South of Leonora Townsite
PIG WELL
25 kms East of Leonora Townsite
Change
During Quarter
Tenement ID
Tenement ID
E37/1152
E37/1156
E37/1201
E37/1203
E37/1315
E37/1326
E40/283
E40/285
E40/323
E40/366
E40/369
M40/330
M40/346
P37/8350
P37/8390
P37/8500
P37/8504
P40/1283
P40/1464
Ownership
at end of Quarter
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
IRON KING / MT FOURACRE
45 kms North North West of Leonora
Change
During Quarter
Tenement ID
E37/1134
M37/1327
P37/8359
P37/8414
P37/8415
P37/8455
P37/8458
P37/8459
P37/8460
P37/8461
P37/8491
Ownership
at end of Quarter
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
Change
During Quarter
Ownership
at end of Quarter
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
P37/8948
P37/8949
P37/8950
P37/8951
P37/8952
P37/8953
P37/8954
P37/8955
P37/8956
P37/8957
P37/8958
P37/8959
P37/8960
P37/8961
P37/8962
P37/8963
P37/8964
P37/8974
P37/8975
P37/8976
P37/8977
P37/8978
RAESIDE
8 kms East of Leonora Townsite
Tenement ID
E37/1300
Ownership
at end of Quarter
100%
Change
During Quarter
-78-
Kin Mining NL
TENEMENT INFORMATION AS REQUIRED BY LISTING RULE 5.3.3
CARDINIA / MERTONDALE
35 kms East & North East of Leonora Townsite
Change
During Quarter
Tenement ID
Change
During Quarter
Tenement ID
L37/106
L37/127
L37/128
L37/195
L37/196
L37/226
L37/232
L37/241
L37/242
L37/243
L37/244
M37/81
M37/82
M37/86
M37/88
M37/223
M37/227
M37/231
M37/232
M37/233
M37/277
M37/299
M37/300
M37/316
M37/317
M37/422
M37/428
M37/487
M37/594
M37/646
M37/720
M37/1284
M37/1303
M37/1304
M37/1315
M37/1318
M37/1319
M37/1323
M37/1325
M37/1328
M37/1329
M37/1330
M37/1331
M37/1332
M37/1333
M37/1340
M37/1342
M37/1345
Ownership
at end of Quarter
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%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
0%
0%
100%
100%
100%
100%
0%
0%
Ownership
at end of Quarter
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%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
P37/8941
P37/8942
P37/8943
P37/8944
P37/8945
P37/8946
P37/8947
P37/8988
P37/8989
P37/8990
P37/8991
P37/8992
P37/8993
P37/8994
P37/8995
P37/8996
P37/8997
P37/8998
P37/8999
P37/9000
P37/9001
P37/9002
P37/9003
P37/9004
P37/9008
P37/9009
P37/9010
P37/9122
P37/9123
P37/9124
P37/9125
P37/9126
P37/9127
P37/9128
P37/9129
P37/9130
P37/9131
P37/9132
P37/9133
P37/9134
P37/9135
P37/9136
P37/9137
P37/9158
P 37/9166
P 37/9170
P 37/9171
P 37/9172
-79-
Kin Mining NL
Tenement ID
P37/8007
P37/8196
P37/8199
P37/8209
P37/8210
P37/8223
P37/8536
P37/8537
P37/8538
P37/8539
P37/8540
P37/8541
P37/8542
P37/8543
P37/8737
P37/8738
P37/8739
P37/8740
P37/8741
P37/8742
P37/8743
P37/8744
P37/8795
P37/8938
P37/8939
P37/8940
Ownership
at end of Quarter
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%
CARDINIA / MERTONDALE
35 kms East & North East of Leonora Townsite
Change
During Quarter
Tenement ID
Change
During Quarter
Ownership
at end of Quarter
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
0%
0%
0%
P 37/9173
P37/9221
P37/9222
P37/9223
P37/9224
P37/9225
P37/9226
P37/9227
P37/9228
P37/9229
P37/9230
P37/9231
P37/9232
P37/9326
P37/9327
P37/9328
RAESIDE
8 kms East of Leonora Townsite
Tenement ID
L37/77
L37/125
M37/1298
E37/1402
Ownership
at end of Quarter
100%
100%
100%
0%
Change
During Quarter
Tenement Application