KINGSTON RESOURCES LIMITED
& its Controlled Entities
KINGSTON RESOURCES LIMITED
ABN 44 009 148 529
Annual Financial Report
For the year ended 30 June 2024
CONTENTS
KINGSTON RESOURCES LIMITED
& its Controlled Entities
Contents
Page No.
Corporate Directory ...................................................................................................................................... 2
Chairman’s Letter ......................................................................................................................................... 3
Directors’ Report .......................................................................................................................................... 4
Lead Auditor’s Independence Declaration ................................................................................................. 29
Consolidated Statement of Financial Position ............................................................................................ 30
Consolidated Statement of Profit or Loss and Other Comprehensive Income ........................................... 31
Consolidated Statement of Changes in Equity ........................................................................................... 32
Consolidated Statement of Cash Flows ...................................................................................................... 33
Notes to the Financial Statements .............................................................................................................. 34
Directors’ Declaration ................................................................................................................................ 63
Independent Auditor’s Report .................................................................................................................... 64
Corporate Governance Statement .............................................................................................................. 69
Additional Information ............................................................................................................................... 70
CORPORATE DIRECTORY
KINGSTON RESOURCES LIMITED
& its Controlled Entities
- 2 -
Corporate Directory
DIRECTORS
Mick Wilkes (B Eng (Hons), MBA, GAICD)
Non-Executive Chairman
Andrew Corbett (B Eng (Mining, Hons), MBA)
Managing Director
Anthony Wehby (MAICD)
Non-Executive Director
Stuart Rechner (BSc, LLB, MAIG, MAusIMM, GAICD)
Non-Executive Director
COMPANY SECRETARY
Vinod Manikandan
REGISTERED OFFICE AND
PRINCIPAL PLACE OF BUSINESS
Suite 202 – 201 Miller Street
North Sydney NSW 2060
AUSTRALIA
Telephone
(02) 8021 7492
Email
info@kingstonresources.com.au
Website
www.kingstonresources.com.au
AUDITORS
Hall Chadwick Chartered Accountants
SHARE REGISTRY
Automic Group
BANKERS
Australia & New Zealand Banking Group Limited
Macquarie Group Limited
Bank of South Pacific
SOLICITORS
Cowell Clarke Commercial Lawyers
Resources Legal Pty Ltd
STOCK EXCHANGE
Australian Securities Exchange (ASX)
Secondary Listing - Frankfurt Stock Exchange
ASX CODE
KSN
DIRECTORS’ REPORT
KINGSTON RESOURCES LIMITED
& its Controlled Entities
- 3 -
Chairman’s Letter
To our valued shareholders and other stakeholders
Welcome to the Annual Report for 2024.
It has been another very busy year for the team at Kingston, with the successful completion of the tailings retreatment
project and refurbishment of the process plant in readiness for mining gold and polymetallic ores from our resources.
We completed the tailings treatment in May, with 12,461oz of gold sold for the year, producing $10 million in operating
cash flow. First gold ore from the Pearse pits was mined in June and processing through the newly refurbished crusher
and mills commenced after year end in July 2024.
What is most exceptional about the plant refurbishment is that very low costs incurred, which was achieved by a small
team of highly skilled and dedicated professionals at site to manage the project. We anticipate this will be the start of long
run of mining and processing at Mineral Hill that will underpin the growth of the Company in the coming years.
As with most other activities at Mineral Hill, open pit mining is being carried out by the Company. Local employees who
were operating the tailings re-mining project have transitioned across to open pit mining, with mining equipment being
hired from a local supplier. We believe this strategy will continue to deliver significant benefits to the Company and local
communities, and we therefore intend to follow the same strategy for development of the underground mine, which will
recommence in 2025.
At Kingston we believe Mineral Hill is now a significant strategic asset. It is unique in NSW, being a fully permitted
mining and processing operation that can produce precious and base metals from the various orebody types that exist
within the broader Cobar region. The region has multiple “stranded” orebodies that are not currently large enough to
justify the time and cost to permit and build a dedicated process plant and tailings facility, thus presenting a significant
opportunity for Kingston and the shareholders of other companies to benefit through strategic cooperation.
The other significant development is the renewed enthusiasm for gold. In FY24, the gold price rose 21% from A$2,877
to A$3,486, as the global economy adjusted to expectations of falling interest rates following the high inflationary period
post covid.
Misima continues to represent an outstanding investment opportunity with strong economics and a long mine life. We
continue to pursue strategic options for the development of Misima that will lead to growth in shareholder value and
realisation of significant social benefits to the people of Misima and the people of PNG more broadly.
Thank you again for your continued support for Kingston.
Your sincerely
Mick Wilkes
Non-Executive Chair
13 September 2024
DIRECTORS’ REPORT
KINGSTON RESOURCES LIMITED
& its Controlled Entities
- 4 -
Directors’ Report
The Directors present their report together with the financial statements of the Consolidated Entity (or ‘Group’), being
Kingston Resources Limited (‘Kingston” or the “Company’) and its subsidiaries, for the financial year ended 30 June
2024 and the independent auditor’s report thereon.
PRINCIPAL ACTIVITIES
The Company is an Australian-based Company listed on the ASX. The principal activity of the Group during the period
was mineral production and exploration.
OPERATING RESULTS AND REVIEW OF OPERATIONS FOR THE YEAR
Operating Results
Kingston reported a statutory after tax loss of $720,353 (2023: profit $9,787,333). The financial loss in FY24 relative to
profit in FY23 is due to completion of tailings retreatment project and transitioning to hard rock mining during the year.
Review of Operations
Kingston had an enormously productive year at Mineral Hill, completing numerous development projects and maximising
gold production and cash flow over the term. The company also boasted commencement of open pit mining and a full
plant refurbishment at Mineral Hill. Other major achievements included:
➢ Gold production of 11,818oz from the Tailings Project at Mineral Hill.
➢ Commenced open pit mining at Pearse North with the first blast on 11 June 2024.
➢ Processing plant refurbishment, a major technical and financial success, with key refurbishments including ball
mill re-lining, conveyor belt alignment, crusher circuit, and motor control modernisation.
➢ Near mine underground discovery at Southern Ore Zone (SOZ), with a new underground lode discovered,
confirming potential resource expansion.
➢ Assays from drill holes at SOZ extended high grade mineralisation over 400m along strike, confirming high-
grade polymetallic mineralisation and supporting resource confidence.
➢ Mineral Resource Estimate for Pearse North increased by 30% in gold and 67% in silver (contained metal basis).
➢ Multiple phases of exploration and geotechnical drilling at deposits within the current mine plan and near mine
targets within the mining lease.
➢ Strategic review at Misima Gold Project in PNG continued to maximise project value with interest driven by
favourable gold prices. Potential pre-tax NPV of $2.2 billion under current market conditions.
The company's growth outlook has been strengthened by the transition back to hard rock mining, allowing the company
to redirect resources and skilled staff to higher grade ore. This achievement lays the groundwork for a five-year mine plan
beyond the tailings processing phase. This plan complements the longer-term opportunities offered by the Misima Gold
Project.
Mineral Hill Mine
Tailings Project
Kingston had a highly successful year at Mineral Hill for our operations and projects. The Tailings project was
successfully completed in May 2024, producing a total of 34,540 ounces of gold and generating $26 million in operating
DIRECTORS’ REPORT
KINGSTON RESOURCES LIMITED
& its Controlled Entities
- 5 -
cash flow since acquisition of Mineral Hill by Kingston in January 2022. This achievement has provided a solid financial
foundation for the company's ongoing operations.
Gold sales from the Tailings Project were 12,461oz at an average sales price of A$3,104/oz with all-in-sustaining cost
(AISC) of $2,291
Table 1: FY24 production results and performance relative to FY23.
FY23 Actuals
FY24 Actuals
Y on Y Δ
Tonnes Processed (t)
627,994
505,845
-19%
Average Feed Grade (g/t)
1.36
1.30
-4%
Gold Production (oz)
16,520
11,818
-28%
Gold Sales (oz)
16,068
12,461
-22%
Silver Sales (oz)
16,898
16,266
-4%
AISC (A$/oz)
$1,686
$2,291
36%
Sales (A$m)
$44.7
$38.67
-13%
Operating Cashflow (A$m)
$16.9
$9.99
-41%
Open Pit Mining Commences
Open pit mining commenced at Pearse North, with the initial blast on 11 June and the first oxide ore delivered to the
ROM pad (See ASX Announcement on 18 June 2024). This marks a significant step towards Kingston's goal of
becoming a regionally significant producer, following the successful completion of the tailings retreatment project in
May 2024. The company’s emphasis on owner-operator mining has continued, with equipment operators from the
tailings mining operation successfully transitioning over to the open pit mining operations.
Figure 1: Open pit blast.
DIRECTORS’ REPORT
KINGSTON RESOURCES LIMITED
& its Controlled Entities
- 6 -
Figure 2: Open pit excavation haulage
Processing Plant Refurbishment and Commissioning
The plant refurbishment has been a major technical and financial success for Kingston this year. Rapid advancements are
occurring in every area of the operation. The project has been entirely managed in-house with our own expertise,
significantly impacting our organisation's capabilities and creating a workforce with diverse skills.
Key areas of focus during the year include the re-lining of the ball mills, alignment of the conveyer belts, refurbishment
of the crusher circuit and fine ore bins and the modernisation of the motor control circuits (electrical control).
In July, stockpiled oxide ore from Pearse North was fed into the comminution circuit, sales of gold and silver doré
commenced in August. Restoring the Mineral Hill processing plant to full capability is creating immense value for the
region. The plant is the only facility in the southern Cobar Basin capable of producing multiple metal concentrates and
precious metal doré.
DIRECTORS’ REPORT
KINGSTON RESOURCES LIMITED
& its Controlled Entities
- 7 -
Figure 3: Stockpiled oxide ore on the ROM pad.
Figure 4: Kingston Board of Directors inspecting the Minerals Hill plant
Exploration and Development
Kingston’s main focus on exploration drilling during the financial year was on the Pearse gold-silver deposits and SOZ
polymetallic deposit. The primary aim of the drilling was to infill the existing drilling and provide data for updating the
Mineral Resources, Ore Reserves and Life of Mine Plan (LOM) plan.
Southern Ore Zone (SOZ)
At SOZ, drilling programs were focussed on increasing the confidence in the current Mineral Resource estimates and
exploring for extensions to the mineralisation. Infill and extensional drilling into the Southern Ore Zone returned high
grade polymetallic assays and resulted in the confirmation of the near mine discovery made in the December quarter of
2023.
DIRECTORS’ REPORT
KINGSTON RESOURCES LIMITED
& its Controlled Entities
- 8 -
Figure 5: Mineral Hill regional geology, resources and infrastructure.
Near-Mine Underground Discovery
Kingston now has three intersections into the newly discovered underground lode. Drill hole KSNDDH019 followed up
the initial intersection made in KSNDDH017 in the footwall of the Southern Ore Zone (See ASX announcement on 15
February 2024). Significant assays over this zone include:
•
12.5m @ 3.41% CuEq from 405m (KSNDDH017)
•
2m @ 6.37% CuEq from 255m (KSNDDH019)
These two drill holes have also confirmed the historical significant intercepts from “New Structure #1” and highlighted
the potential to extend the mineral resources at depth.
DIRECTORS’ REPORT
KINGSTON RESOURCES LIMITED
& its Controlled Entities
- 9 -
Figure 6: Board review on the progress of process plant refurbishment on July 23
The confirmation of the new lode marks a significant milestone for the company, as it paves the way for further
discoveries within the mine. The Southern Ore Zone remains open along strike at both ends and at depth. The
availability of suitable drilling platforms has been the only limiting factor for continuing to expand the footprint of
underground mineralisation so far.
Confirmation of the Main Underground Lode over 400m.
Additional infill and extensional drilling into the underground resources was undertaken during the March quarter.
Outstanding assay results were reported, clearly illustrating the high-grade nature of the deposit and the region’s metal
endowment (see ASX announcement on 9 April 2024). Drill holes KSNDDH020, 21, 22 and 23 were drilled to infill the
upper areas of the underground resources and aimed at increasing the confidence and extent of the existing resources. The
DIRECTORS’ REPORT
KINGSTON RESOURCES LIMITED
& its Controlled Entities
- 10 -
main lode in this part of the deposit (namely, the A-lode) has now been traced continuously over 400m strike and 200-
250m down dip.
Significant intersections include:
•
9m @ 3.14% CuEq from 214m (KSNDDH020):
o
Including 3m @ 8.13% CuEq
•
4m @ 2.38% CuEq from 228m (KSNDDH020)
o
Including 3m @ 4.67% CuEq from 191m (KSNDDH021)
•
7.0m @ 3.76% CuEq from 164m (KSNDDH022):
o
Including 3m @ 6.18% CuEq from 165m
•
8.0m @ 2.06% CuEq from 173m (KSNDDH023)
•
10.2m @ 2.73% CuEq from 187.8m (KSNDDH023)
Figure 7: Drill core from KSNDDH021 (4m wide sulphide rich breccia lode (estimated true width of 2m) within a broader
31.6m wide brecciated and veined lode zone from 175.3mdh).
Pearse North
During the year, drilling was completed at Pearse North, with the primary purpose of collecting additional geotechnical
data in preparation for open pit mining (see ASX announcement on 5 September 2023). The results returned numerous
high-grade gold intercepts, validating the existing geological model and enhancing the Company’s confidence in the mine
plan. Additionally, there were other significant intersections outside the existing Mineral Resources, indicating the
potential for additional mineralisation during mining operations.
DIRECTORS’ REPORT
KINGSTON RESOURCES LIMITED
& its Controlled Entities
- 11 -
Figure 8: PGNT03 significant intersections
The Mineral Resource Estimate (MRE) for Pearse North increased substantially, with gold and silver resources rising by
30% and 67% respectively. The total Resources is now 292 kt @ 3.2 g/t Au and 34 g/t Ag with 30 koz of gold and 318
koz of silver (see ASX Announcement on 7 May 2024).
This increase reflects a greater confidence in the deposit’s continuity, as a review of the orientation of mineralisation
demonstrated greater spatial continuity than previously modeled. Additionally, the mine plan is being optimised to
leverage the current favorable gold prices, with planned pit designs undergoing re-optimisation.
Table 2 Pearse North Mineral Resource Estimate at 1.0g/t Au Cut Off
Classification
Tonnes kt
Grade Au g/t
Grade Ag g/t
Metal Au koz
Metal Ag koz
Indicated
270
3.2
34.2
28
297
Inferred
22
2.9
29.1
2
21
Total
292
3.2
33.9
30
318
* Due to rounding to appropriate significant figures, minor discrepancies may occur, tonnages are dry metric tonnes.
DIRECTORS’ REPORT
KINGSTON RESOURCES LIMITED
& its Controlled Entities
- 12 -
Figure 9: Plan view of Pearse North mineralisation wireframe outlines, block model and pit design (horizontal section at 310m
AHD +-5m).
Eastern Ore Zone
Drilling at the Eastern Ore Zone during the year confirmed a continuous lode, with a notable interval of 3m @ 25.94g/t
gold. Kingston plans to re-enter the Eastern Ore Zone's underground development, where high-grade gold-copper was
historically mined.
The company is updating Mineral Resource estimates for near-term production areas. While EOZ mineralisation isn't
currently included, it may be incorporated in future estimates.
Encouraged by positive results, Kingston aims to expand Mineral Resources and extend Mineral Hill's life of mine through
further exploration and drilling. The company remains focused on maximising mining value and sustainable growth.
DIRECTORS’ REPORT
KINGSTON RESOURCES LIMITED
& its Controlled Entities
- 13 -
Figure 10: Long section view of Eastern Ore Zone (EOZ) showing extension potential.
Updated LOM Plan
An update of the life of mine (LOM) schedule is currently underway. This update will include revised Ore Reserve
estimates for the Pearse Pits and a first-ever Ore Reserve for the Southern Ore Zone (SOZ). The Ore Reserve inputs will
incorporate the latest Pearse North Mineral Resource Estimate (MRE), updated metal pricing for all deposits, and a
planned update of the SOZ MRE (which is being finalized). The sequencing will align with the LOM plan disclosed to
the ASX on 27 June 2023, comprising open pit mining from the Pearse Pits and underground mining from SOZ and Jack's
Hut. This represents the most comprehensive technical work undertaken at Mineral Hill in recent history, providing all
stakeholders with clarity on the asset's long-term future. Numerous opportunities to extend the LOM and increase the
proportion of Ore Reserves in the mine plan will continue to emerge.
Safety, Environment and Sustainability
During the year, Kingston implemented extensive new safety, training, and hazard management measures at Mineral Hill.
With the transition to open pit mining, we've updated mining procedures and implemented a range of explosives
management plans and protections.
On-site training has intensified with the addition of staff in the mining and processing departments. In line with our
commitment to local employment, we've launched a traineeship program offering nationally recognised qualifications.
We're continuously upgrading our workforce's skills through on-the-job training, focusing on areas such as working at
height, confined space operations, first aid, and blast procedures.
Kingston Resources is committed to sustainability principles and has begun reporting on key environmental, social, and
governance aspects. We're compiling sustainability disclosures using universal, comparable metrics centred on people,
planet, prosperity, and governance principles. This framework allows us to align our mainstream reporting with
performance against key indicators.
We're actively seeking opportunities to enhance transparency on issues material to our business.
DIRECTORS’ REPORT
KINGSTON RESOURCES LIMITED
& its Controlled Entities
- 14 -
Misima Gold Project
Kingston’s focus at the Misima Gold Project has been to attract a company to help bring the mine back into production.
An internal process has been operating to select a partner who has the technical credibility and financial strength to realise
the project’s huge cash flow potential. . The project contains enormous latent value for Kingston shareholders, particularly
in light of the recent strength in the price of gold.
Recent momentum in the gold price over the last year has generated significant interest in the project, which is highly
leveraged to gold prices. Under a favourable gold price scenario of US$2,400/oz and an AUD:USD exchange rate of 0.65,
Misima is projected to deliver a pre-tax NPV1 of $2.2 billion.
Near-mine surface mapping and inspections were undertaken during the year to firm up exploration models. Additionally,
further environmental data was collected for the environmental impact statement (EIS).
The company is partnering with the local PNG government representatives and related financial institutions to deliver a
Women in Business program, which aims to increase the financial literacy of women on the island. Women are
encouraged to develop business plans for their own business ideas so that they can advance their idea through to funding
and eventual launch. The program has had high engagement and groups in the broader community are also expressing
interest in being involved.
Figure 1: Women in Business program on Misima Island.
DIRECTORS’ REPORT
KINGSTON RESOURCES LIMITED
& its Controlled Entities
- 15 -
MINERAL RESOURCES TABLE
Mineral Hill (NSW, Australia)
Table 3: Mineral Hill Mineral Resource summary, prepared by Mr S. Hayward of Kingston Resources Ltd. Rounding errors may
occur.
Resource
Category
Tonnes
Au
Ag
Cu
Pb
Zn
Au
Ag
Cu
Pb
Zn
kt
g/t
g/t
%
%
%
koz
koz
kt
kt
kt
Measured
228
2.11
11
1.3%
0.5%
0.3%
15
80
3
1.2
0.7
Indicated
4,893
1.08
28
1.2%
1.7%
1.1%
169
4,361
47
70
42
Inferred
3,098
1.17
23
0.7%
1.4%
1.2%
117
2,253
22
42
38
Total
8,220
1.14
27
1.0%
1.6%
1.1%
302
6,693
72
113
81
Table 4: Mineral Hill Mineral Reserve summary, prepared by Mr J. Wyche of Australian Mine Design and Development Pty
Ltd. Rounding errors may occur.
Reserve
Tonnes
Au
Ag
Cu
Pb
Zn
Au
Ag
Cu
Pb
Zn
kt
g/t
g/t
%
%
%
koz
koz
kt
kt
kt
Proved
-
0.00
0
-
0
Probable
697
1.95
57
44
470
Total
697
1.95
57
44
470
Misima Gold Project (PNG)
Table 5: Misima Gold Project Mineral Resource summary, prepared by Mr S. Hayward of Kingston Resources Ltd. Rounding
errors may occur.
Deposit
Classificatio
n
Cutoff
Tonnes
Gold
Silver
Au Moz
Ag Moz
g/t Au
Mt
g/t Au
g/t Ag
Umuna Total
Resource
Indicated
0.3
93.5
0.78
4.3
2.4
13.1
Inferred
0.3
64.1
0.58
3.8
1.2
7.5
Umuna TOTAL
157.6
0.70
4.1
3.6
20.5
Cooktown Stockpile
Inferred
0.5
3.8
0.65
7.0
0.1
0.9
Cooktown Stockpile
3.8
0.65
7.0
0.1
0.9
Ewatinona Total
Resource
Indicated
0.3
4.2
0.88
2.6
0.12
0.3
Inferred
0.3
3.4
0.74
3.2
0.08
0.3
Ewatinona TOTAL
7.6
0.81
2.8
0.2
0.7
Misima
Indicated
97.7
0.79
4.3
2.5
13.4
Inferred
71.3
0.59
3.8
1.4
8.7
Misima TOTAL
169
0.71
4.1
3.8
22.1
Table 6: Misima Gold Project Ore Reserve summary, prepared by Mr J. Wyche of Australian Mine Design and Development
Pty Ltd. Rounding errors may occur.
Tonnes
Gold
Silver
Au koz
Ag koz
Mt
Au g/t
Ag g/t
Ewatinona
Probable
3.9
0.8
2.4
100
300
Ewatinona Total
3.9
0.8
2.4
100
300
Umuna
Probable
71.7
0.8
4.6
1,800
10,600
Umuna Total
71.7
0.8
4.6
1,800
10,600
Probable
75.6
0.8
4.5
1,900
10,900
Misima Total Reserve
75.6
0.8
4.5
1,900
10,900
DIRECTORS’ REPORT
KINGSTON RESOURCES LIMITED
& its Controlled Entities
- 16 -
COMPETENT PERSON’S STATEMENT
The information in this report that relates to Exploration Results and Mineral Resources is based on information compiled
by Mr. Stuart Hayward BAppSc (Geology) MAIG, a Competent Person who is a member of the Australian Institute of
Geoscientists. Mr. Hayward is an employee of the Company. Mr. Hayward has sufficient experience that is relevant to
the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a
Competent Person as defined in the 2012 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral
Resources and Ore Reserves”. Mr. Hayward consents to the inclusion in this report of the matters based upon the
information in the form and context in which it appears.
The Competent Person signing off on the overall Ore Reserves Estimate is Mr John Wyche BE (Min Hon), of Australian
Mine Design and Development Pty Ltd, who is a Fellow of the Australasian Institute of Mining and Metallurgy and who
has sufficient relevant experience in operations and consulting for open pit metalliferous mines. Mr Wyche consents to
the inclusion in this report of the matters based upon the information in the form and context in which it appears.
Kingston publicly reports Exploration Results and Mineral Resource estimates in accordance with the ASX Listing Rules
and the requirements and guidelines of the 2012 edition of the Australasian Code for Reporting Exploration Results,
Mineral Resources and Ore Reserves – the JORC Code. Kingston’s governance for public reporting of Exploration Results
and Mineral Resource estimates includes important assurance measures. All reports are signed-off by appropriate JORC
Competent Persons with JORC Code Table 1 Checklists as required. Exploration Results and Mineral Resource estimates
are also peer reviewed (either by Kingston technical staff or suitably qualified external consultants) before Board approval
and ASX release.
FINANCIAL POSITION
At the end of the financial year, the Consolidated Entity had net assets of $90,781,524 (2023: $76,454,900) and held
$8,357,776 in cash (2023: $18,206,767).
On 26 July 2023, the Company issued 4,561,810 shares to eligible employees upon exercise of 4,561,810 LTI options for
cash totalling to $45,618. The fair value of options issued was $183,515.
On 17 August 2023, the Company issued 11,764,705 shares and 5,882,352 unlisted attaching options totalling to
$1,000,000 under Tranche 2 of the Share Placement Offer. No monies were raised from the Tranche 2 placement, however
the final milestone payment of USD$3.5 million due to Quintana Resources Holdings LP upon producing 30,000 Oz’s of
gold since acquisition of Mineral Hill Pty Ltd was reduced by USD$645,100 (A$1million). Fair value of unlisted options
amounting to $69,043 was recognised under share-based payment reserve. The unlisted options are each exercisable at
$0.14 each to acquire one fully paid ordinary share exercisable at any time up to 31 July 2025.
On 17 August 2023, the Company issued 10,247,017 shares and 5,123,459 unlisted attaching options under the SPP offer
for cash totalling $871,000. Fair value of unlisted options amounting to $60,136 was recognised under share-based
payment reserve. The unlisted options are each exercisable at $0.14 each to acquire one fully paid ordinary share
exercisable at any time up to 31 July 2025.
On 18 August 2023, the SPP was completed upon issuing 1,517,647 shares and 758,823 unlisted attaching options to the
sub underwriter Delphi Unternehmensberatung Akteingesellschaft, an existing major shareholder and sophisticated
investor for cash totalling to $129,000. Fair value of unlisted options amounting to $8,907 was recognised under share-
based payment reserve. The unlisted options are each exercisable at $0.14 each to acquire one fully paid ordinary share
exercisable at any time up to 31 July 2025.
On 2 April 2024, the Company announced its intention to undertake a Share Placement Offer and an Accelerated Non-
Renounceable Rights Issue Offer (ANREO) raising a total of $13.48 Million. On 8 April 2024, the Company issued
124,490,461 shares under the Placement Offer and 11,241,969 shares under the accelerated component of the ANREO
for cash totalling to $8,822,608.
On 15 May 2024, the Company issued 71,751,815 shares under the retail component of the ANREO for cash totalling to
$4,663,867.
DIRECTORS’ REPORT
KINGSTON RESOURCES LIMITED
& its Controlled Entities
- 17 -
SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS
Other than reported above in the Review of Results and Operations, there were no significant changes in the state of
affairs of the Company during the reporting period.
MATTERS SUBSEQUENT TO THE END OF FINANCIAL YEAR
On 29 August 2024, 1,134,182 STI performance Options vested and were converted to non-transferable ZEPOs. All the
vested STI ZEPOs have an expiry date of 3 years from vesting. 2,010,910 unvested STI performance options expired.
On 23 August 2024, the Company secured a $5 million debt facility in addition to its existing $10 million debt, under a
revised facility agreement with PURE Asset Management to fund the Company’s key growth initiatives at Mineral Hill.
The additional debt facility was drawn immediately and is repayable on 22 February 2027.
Other than the above, there has been no other matter or circumstance which has arisen since 30 June 2024 that has
significantly affected or may significantly affect:
a)
Kingston Resources Limited’s operations in future financial years; or
b)
the results of those operations in future financial years; or
c)
Kingston Resources Limited’s state of affairs in future financial years.
DIVIDENDS OR DISTRIBUTIONS
No dividends were paid during the financial year and the directors do not recommend the payment of a dividend.
FUTURE DEVELOPMENTS AND EXPECTED RESULTS
The Group will continue its operating activities and evaluation of its mineral projects and undertake generative work to
identify and potentially acquire new resource projects. Due to the nature of the business, the result is not predictable.
ENVIRONMENTAL REGULATIONS
The mineral tenements granted to the Company pursuant to New South Wales Mining Act 1992 and the Papua New
Guinea Mining Act 1992, are granted subject to various conditions which include standard environmental requirements.
The Company adheres to these conditions and the directors are not aware of any non-compliance with environmental
laws.
INFORMATION ON THE DIRECTORS
The Directors of the Company at any time during or since the end of the financial year are:
▪
Mick Wilkes – Chair (Independent Non-Executive)
▪
Andrew Corbett – Director (Managing)
▪
Anthony Wehby – Director (Independent Non-Executive)
▪
Stuart Rechner - Director (Independent Non-Executive)
Directors have been in office since the start of the financial year to the date of this report unless otherwise stated.
DIRECTORS’ REPORT
KINGSTON RESOURCES LIMITED
& its Controlled Entities
- 18 -
Mick Wilkes, Non-Executive Chair (B Eng (Hons), MBA, GAICD)
Term of Office
Appointed Non-Executive Chair of Kingston Resources Limited from 1 December 2020;
previously Non-Executive Director of Kingston Resources Limited from 6 July 2018 to 1
December 2020.
Skills and Experience:
Mr Wilkes is a mining engineer with over 35 years of broad international experience with a
strong emphasis on operations management and new mine development, predominantly in
precious and base metals across Asia and Australia. He was the President and CEO of
OceanaGold Corporation (ASX:OCG) from 2011 to 2020. In previous roles he was the
Executive General Manager of Operations at OZ Minerals responsible for the development
of the Prominent Hill copper/gold project in South Australia and General Manager of the
Sepon gold/copper project for Oxiana based in Laos. His earlier experience included 10 years
in various project development roles in Papua New Guinea.
Mr Wilkes was appointed as a Non-Executive Director of Genesis Minerals Ltd in September
2022. In April 2022 Mr Wilkes was appointed Non-Executive Chair of Andromeda Metals
Ltd (ASX:ADN). Mr Wilkes and was previously Non-Executive Director of Dacian Gold
Ltd (ASX:DCN) from September 2021 then Non-Executive Chair from March 2022 to July
2022. He was also a Non-Executive Director of Matador Mining Ltd (ASX:MZZ) from July
2020 to May 2022.
Mr Wilkes holds a Bachelor of Engineering from the University of Queensland, a Master of
Business Administration from Deakin University, and is a member of both the Australian
Institute of Mining and Metallurgy, and the Australian Institute of Company Directors.
Andrew Corbett, Managing Director (B Eng (Mining, Hons), MBA)
Term of Office:
Managing Director of Kingston Resources Limited since 4 July 2016.
Skills and Experience:
Mr Corbett is Managing Director and CEO of the Company. Mr Corbett is a highly
experienced mining engineer, having operated in the mining industry for over 25 years. Mr
Corbett has senior corporate, operational and mine management experience combined with
an in-depth understanding of global equity markets, business development and corporate
strategy within the mining sector. His prior roles include General Manager at Orica Mining
Services based in Germany and Co-Portfolio Manager of the Global Resource Fund at
Perpetual Investments as well as mine management and operations roles with contractor and
owner-mining operations.
Anthony Wehby, Non-Executive Director (MAICD)
Term of Office:
Non-Executive Director of Kingston Resources Limited from 1 December 2020; previously
Non-Executive Chairman of Kingston Resources Limited from 4 July 2016 to 1 December
2020. Mr Wehby is Chair of the Audit and Risk Committee.
Skills and Experience:
Mr Wehby is a highly experienced board member and chairman. He is the Chairman of
Variscan Mines Limited (ASX: VAR). He was previously a Director of Ensurance Ltd and
Chairman of Tellus Resources Limited and Aurelia Metals Limited. Since 2001, Mr Wehby
has maintained a financial consulting practice, focusing on strategic advice to companies
including investments, divestments and capital raisings. Prior to 2001, Mr Wehby was a
partner in PricewaterhouseCoopers Australia (Coopers & Lybrand) for 19 years.
Mr Wehby is a Member of the Australian Institute of Company Directors.
DIRECTORS’ REPORT
KINGSTON RESOURCES LIMITED
& its Controlled Entities
- 19 -
Stuart Rechner, Non-Executive Director (BSc, LLB, MAIG, MAusIMM, GAICD)
Term of Office:
Non-Executive Director from 4 July 2016; previously Executive Director of Kingston
Resources Limited from 23 February 2015. Mr Rechner is Chair of the Remuneration and
Nomination Committee.
Skills and Experience:
Mr Rechner is an experienced company director and geologist with a proven track record in
project generation, acquisition, exploration, funding and development in Australia and
overseas. Mr Rechner holds degrees in both geology and law and is a member of the
Australian Institute of Geoscientists, the Australasian Institute of Mining and Metallurgy and
the Australian Institute of Company Directors. For over ten years Mr Rechner was an
Australian diplomat with postings to Beijing and Jakarta.
Mr Rechner has been a Director of Strategic Energy Limited (ASX:SER) since 12 September
2014.
COMPANY SECRETARY
Robyn Slaughter was the Company Secretary from 8 November 2022 to 22 January 2024. Robyn is a Company Secretary
who works at Automic Group, which provides market leading, cloud-based share registry technology, compliance and
governance solutions, supported by a tailored range of professional services. She works closely with a number of boards
of both listed and unlisted public companies. Robyn is a qualified Governance Professional ('CGI') and Affiliate of the
Governance Institute of Australia ('GIA'), who holds a Master's degree in Corporate Governance and a Bachelor's degree
in Accounting and Finance.
Vinod Manikandan is the General manager in Finance for the group and has been the Company Secretary since 22 January
2024 . Vinod is a member of CPA Australia and an associate member of the Governance Institute of Australia. He has
completed his post graduate studies in Applied Corporate Governance and has a Bachelor's degree in Commerce.
DIRECTORS’ INTERESTS
As at the date of this report the relevant interests of each of the Directors, held either directly or indirectly through their
associates, in the securities of Kingston are as follows:
Director
Fully Paid Ordinary Shares
(KSN)
Unlisted Options
Performance Options
Mick Wilkes 1
3,945,679
176,470
-
Andrew Corbett 2,5
7,986,181
4,801,349
922,473
Anthony Wehby 3
3,044,223
352,941
-
Stuart Rechner 4
1,344,281
176,470
-
1 Mick Wilkes holds a relevant interest in the specified number of Shares and Options as a result of being a director of
Eligius Holdings Pty Limited as trustee of Eligius Holdings Pty Limited ATF, which is the registered holder of those
Shares and Options.
2 Andrew Corbett holds a relevant interest in the specified number of Shares and Options as a result of being a director
of Milamar Group Pty Ltd as trustee of Milamar Family Trust, which is the registered holder of those Shares and
Options
3 Anthony Wehby holds a relevant interest in Options as he is a related party to Mrs Rosemary Wehby, who is the
registered holder of the options.
4 Stuart Rechner holds a relevant interest in the specified number of Shares and Options as a result of being a director
of Osmium Holdings Pty Limited as trustee of Ferndale Superannuation Fund, which is the registered holder of those
Shares and Options.
5 As approved by Shareholders at the general meeting on 14 August 2023, Andrew Corbett has a right to acquire MH
Project Goal Performance Options valued at $300,000, subject to satisfaction of various vesting conditions. The
earliest vesting date is 30 June 2025.The number of securities to be issued in respect of rights will be calculated on the
basis of the 20-day KSN VWAP immediately prior to the vesting condition being met. Any unvested securities will
automatically lapse on 31 July 2025
DIRECTORS’ REPORT
KINGSTON RESOURCES LIMITED
& its Controlled Entities
- 20 -
MEETINGS OF DIRECTORS
The number of Directors’ meetings and Committee meetings, and the number of meetings attended by each of the
Directors who was a member of the Board and the relevant Committee, held during the year ended 30 June 2024 were:
Board Meetings
Audit and Risk Committee
Remuneration and
Nomination Committee
Meetings
held while a
Director
Number
attended
Meetings
held while a
Director
Number
attended
Meetings
held while a
Director
Number
attended
Mick Wilkes
6
6
4
4
2
2
Andrew Corbett
6
6
-
-
-
-
Anthony Wehby
6
6
4
4
2
2
Stuart Rechner
6
6
4
4
2
2
REMUNERATION REPORT (AUDITED)
This remuneration report outlines the director and executive remuneration arrangements of the Company and the Group
for the year ended 30 June 2024 in accordance with the requirements of the Corporations Act 2001 and its Regulations.
(a)
Key management personnel disclosed in this report
For the purposes of this report, key management personnel (KMP) of the Group are defined as those persons having
authority and responsibility for planning, directing and controlling the major activities of the Group, directly or indirectly,
including a director (whether executive or otherwise) of the Company.
Details of key management personnel:
M Wilkes
Non-Executive Chair
A Corbett
Managing Director
A Wehby
Non-Executive Director
S Rechner
Non-Executive Director
(b)
Remuneration Philosophy
The objective of the Group’s executive remuneration framework is to attract, motivate and retain high quality personnel
then incentivise and reward performance fairly and responsibly. The framework aligns executive reward with the
achievement of strategic objectives and the creation of long-term value for shareholders. The Board has established a
separate Remuneration and Nomination Committee which meets as required to review remuneration, recruitment,
retention, and termination procedures and to evaluate KMP performance. Our values of safety, respect for the
environment, respect for each other, social responsibility, honesty and accountability guide the Committee in policy
formation and decision making.
Executive remuneration is benchmarked against similar organisations in regards to industry and size; and, from time to
time, independent external advice is sought from remuneration consultants. The Corporate Governance Statement
provides further information on the Company’s remuneration governance.
DIRECTORS’ REPORT
KINGSTON RESOURCES LIMITED
& its Controlled Entities
- 21 -
(c)
Executive remuneration policy and framework
In determining executive remuneration, the Remuneration and Nomination Committee aims to ensure that remuneration
practices are:
• Competitive and reasonable, enabling the Company to attract and retain key talent;
• Aligned to the Company’s strategic and business objectives and the creation of shareholder value;
• Transparent and easily understood; and
• Acceptable to shareholders.
The Remuneration and Nomination Committee reviews executive packages annually by reference to the executive’s
performance and comparable information from industry sectors and other listed companies in similar industries. The terms
and conditions for the Managing Director are considered appropriate for a junior precious and base metals producer and
developer.
Options and performance rights may be issued to directors subject to approval by shareholders. All remuneration paid to
directors is valued at the cost to the Group and expensed. Options are valued using the Black-Scholes methodology.
(d)
Relationship between remuneration and the Group’s performance
The Board has structured its remuneration arrangements in such a way it believes is in the best interests of building
shareholder wealth in the longer term. Directors’ remuneration is set by reference to other companies of similar size and
industry, and by reference to the skills and experience of directors. Fees paid to Non-Executive Directors are not linked
to the performance of the Group.
The following table shows the net loss, loss per share and share price for the last five financial years.
2024
2023
2022
2021
2020
Net Profit/( Loss)
($720,353)
$9,807,227
($2,088,167)
($1,954,631)
($751,587)
Diluted Profit/(Loss) per share
(cents/share)
(0.14)
2.37
(0.67)
(0.76)
(0.42)
Share price at year end (cents)
8.2
7.8
8.1
21.5
17.0
Long-term (LTI) and short-term (STI) incentives are provided to KMP in the form of Performance Securities over
ordinary shares of the Company and are considered to promote continuity of employment and provide additional incentive
to recipients to increase shareholder wealth. Performance Securities may only be issued to directors subject to approval
by shareholders in general meeting. Outstanding business and individual performance are required to achieve the
maximum level of remuneration. This includes financial; health and safety; and environmental, social & governance
components.
During the Financial Year the following incentive Performance Securities were issued:
•
FY23 Service Fee Options 699,313
•
FY24 Service Fee Options 874,576
•
Unlisted Options 6,737,891 (FY23 5,171,621)
•
STI Performance Rights nil (FY23 6,785,845).
•
STI Performance Options 3,145,092 (FY23: nil)
Non-Executive Directors remuneration policy
On appointment to the Board, all non-executive directors enter into a service agreement with the Company in the form of
a letter of appointment. The letter summarises the Board policies and terms including remuneration, relevant to the office
of director.
The Board policy is to remunerate non-executive directors at commercial market rates for comparable companies for their
time, commitment and responsibilities.
DIRECTORS’ REPORT
KINGSTON RESOURCES LIMITED
& its Controlled Entities
- 22 -
The maximum aggregate amount of fees that can be paid to non-executive directors is subject to approval by shareholders
is currently set at $500,000 per annum (approved by shareholders at 2021 AGM). Fees may also be paid to non-executive
directors for additional consulting services provided to the Company above and beyond normal non-executive duties.
Fees for non-executive directors are not linked to the performance of the Group. Non-executive directors’ remuneration
may also include an incentive portion consisting of options, subject to approval by shareholders.
(e)
Voting and comments made at the Company’s 2023 Annual General Meeting
Kingston received over 96.79% of “yes” votes (3.21% of “no” votes) on its remuneration report for the 2023 financial
year.
(f)
Remuneration Details for the Year Ended 30 June 2024
The following table of benefits and payments details, in respect to the financial year, the components of remuneration for
each member of the KMP of the Group.
(g)
Service Agreements
Remuneration and other terms of employment for KMP are formalised in service agreements. The service agreements
specify the components of remuneration, benefits and notice periods.
Michael Wilkes
Mr Wilkes was appointed a Non-Executive Director on 6 July 2018. On 1 December 2020 Mr Wilkes was appointed as
Non-Executive Chair. The appointment is contingent upon satisfactory performance and successful re-election by
shareholders of the Company as and when required by the constitution of the Company and the Corporations Act. Mr
Wilkes is not entitled to any termination benefits unless paid at the discretion of directors.
Andrew Corbett
Mr Corbett was appointed as Managing Director on 4 July 2016. Mr Corbett is remunerated pursuant to the terms and
conditions of an employment agreement entered into on 4 July 2016 with no fixed term. The agreement may be terminated
by either party on the giving of six months’ notice. Mr Corbett is not entitled to any termination benefits other than
accrued pay, leave entitlements and other statutory payments unless paid at the discretion of directors.
Anthony Wehby
Mr Wehby was appointed Non-Executive Chair on 4 July 2016 and transitioned to a Non-Executive Director on 1
December 2020. The appointment is contingent upon satisfactory performance and successful re-election by shareholders
Pension
and Super-
annuation
Director
$
$
$
$
$
$
$
$
$
$
$
$
$
2024
102,441
-
-
-
1,100
-
-
-
-
73,804
-
-
177,345
2023
104,930
-
-
-
-
-
-
-
-
-
-
-
104,930
2024
395,866
154,350
-
-
46,882
-
-
11,770
-
121,108
-
-
729,976
2023
344,427
203,354
-
-
34,817
-
-
6,493
13,098
95,028
-
-
697,217
2024
73,150
-
-
-
8,046
-
-
-
-
29,201
-
-
110,397
2023
69,000
-
-
-
7,245
-
-
-
-
-
-
-
76,245
2024
-
-
-
-
-
-
-
-
-
-
-
-
-
2023
116,696
-
-
40,436
12,188
-
-
-
-
-
-
-
169,320
2024
79,975
-
-
-
1,210
-
-
-
-
29,201
-
-
110,386
2023
76,245
-
-
8,000
-
-
-
-
-
-
-
-
84,245
Total
2024
651,432
154,350
-
-
57,238
-
-
11,770
-
253,314
-
-
1,128,104
2023
711,298
203,354
-
48,436
54,250
-
-
6,493
13,098
95,028
-
-
1,131,957
Other
Other
Incentive
Plans
Andrew Corbett
Anthony Wehby
Mick Wilkes
Stuart Rechner
Chris Drew*
Short-term Benefits
Post-employment
Benefits
Long-term Benefits
Equity-settled Share-based
Payments
Cash-settled
Share-based
Payments
Termination Benefits
Total
LSL
Performance
Rights/Shares
Salary, Fees
and Leave
Profit
Share and
Bonuses
Non-
monetary
Options
DIRECTORS’ REPORT
KINGSTON RESOURCES LIMITED
& its Controlled Entities
- 23 -
of the Company as and when required by the constitution of the Company and the Corporations Act. Mr Wehby is not
entitled to any termination benefits unless paid at the discretion of directors.
Stuart Rechner
Mr Rechner was appointed as Executive Director on 23 February 2015 and transitioned to a Non-Executive Director on
4 July 2016. The appointment as Non-Executive Director is contingent upon satisfactory performance and successful re-
election by shareholders of the Company as and when required by the constitution of the Company and the Corporations
Act. Mr Rechner is not entitled to any termination benefits unless paid at the discretion of directors.
(h)
Equity Interests of KMP
Options holdings of KMP
The number of options over ordinary shares held by each KMP of the Group during the 2024 and 2023 reporting periods
is as follows:
Other changes
2024
Issue Date
No.
Vested and
Exercisable at
End of Year
Vested and
Unexercisable at End
of Year
No.
No.
Mick Wilkes
LTI1
186,667
14-Dec-21
186,667
-
-
-
LTI7
-
28-Nov-23
389,413
-
-
-
LTI8
-
28-Nov-23
489,206
-
-
-
Andrew Corbett
LTI2
3,421,563
6-Nov-19
3,421,563
-
-
-
LTI4
1,086,301
27-Nov-20
-
-
-
-
-
LTI5
815,952
14-Dec-21
-
-
-
-
815,952
LTI6
1,679,215
6-Dec-22
-
-
-
-
1,679,215
LTI3
-
28-Nov-23
-
-
-
-
2,306,182
STI9
-
28-Nov-23
-
-
-
-
922,473
Anthony Wehby
LTI1
69,783
14-Dec-21
69,783
-
-
-
LTI7
-
28-Nov-23
154,950
-
-
-
LTI8
-
28-Nov-23
192,685
-
-
-
-
Stuart Rechner
LTI1
69,783
14-Dec-21
69,783
-
-
-
LTI7
-
28-Nov-23
154,950
-
-
-
LTI8
-
28-Nov-23
192,685
-
-
-
7,329,264
5,321,685
-
-
5,723,822
3 Unlisted LTI Service Fee Options issued 28 November 2023 exercisable at 0c, expiry 31 August 2029, vesting is subject to share price hurdles
4 Unlisted LTI Options issued 5 August 2020 and 27 November 2020 exercisable at 1c, expiry 31 July 2023, exercise is subject to share price hurdles which were not satisfied and lapsed on 31 July 2023
5 Unlisted LTI Options issued 5 November 2021 and 14 December 2021 exercisable at 0c, expiry 31 August 2024, vesting is subject to share price hurdles
6 Unlisted LTI Options issued 6 December 2022 exercisable at 0c, expiry 31 August 2028, vesting is subject to share price hurdles
7 Unlisted LTI FY23 Service Fee Options issued 28 November 2023 exercisable at 0c, expiry 28 November 2026, fully exercised on 15 May 2024
8 Unlisted LTI FY24 Service Fee Options issued 28 November 2023 exercisable at 0c, expiry 28 November 2026, fully exercised on 15 May 2024
-
-
-
922,473
11,699
9 STI Performance Options issued on 28 November 2023 will vest as follows:
(a) Up to 50% of STI Performance Options will automatically vest if the Company’s June 2023 VWAP is equivalent to the 50th percentile relative to a peer group of companies ;
(b) Up to 100% of STI Performance Options will automatically vest if the Company’s June 2023 VWAP is equivalent to the 80th percentile relative to a peer group of companies;
(c) 0% will vest if the Company’s June 2023 VWAP is below the 50th percentile relative to a peer group of companies.
(d) Upon vesting, STI Options covert to non-transferable ZEPO. All vested STI ZEPOs have an expiry date of 3 years from vesting.All STI Options that have not vested by 31 August 2024 will
automatically lapse and be forfeited.
13,016
41,602
12,131,808
466,845
322,049
1,086,301
1 Unlisted LTI Service Fee Options issued 14 December 2021 exercisable at 0c - expiry on 14 December 2024, fully exercised on 17 August 2023
2 Unlisted LTI Options issued 6 November 2019 exercisable at 1c, expiry 31 July 2023, exercise is subject to operational hurdles, fully exercised on 31 July 2023
-
11,165
-
16,186
11,165
69,783
16,186
192,685
69,783
11,165
11,165
-
192,685
16,186
16,186
-
41,093
154,950
13,016
13,016
-
815,952
7,970
-
1,679,215
27,407
-
154,950
13,016
2,306,182
1,086,301
56,118
1,086,301
3,421,563
137,644
137,644
-
$
$
-
186,667
29,867
489,206
-
29,867
389,413
32,711
-
32,711
41,093
Grant Details
Exercised
Lapsed
Balance at Beginning
of Year
No.
Value
Value
No.
DIRECTORS’ REPORT
KINGSTON RESOURCES LIMITED
& its Controlled Entities
- 24 -
Performance Rights Holdings of KMP
The number of performance rights in the Company held by each KMP of the Group during the 2024 and 2023 reporting
period is as follows:
2023
Issue Date
No.
Vested and
Exercisable at
End of Year
Vested and
Unexercisable at End
of Year
No.
No.
Mick Wilkes
LTI¹
300,000
27-Nov-20
-
-
-
-
-
LTI²
186,667
14-Dec-21
-
-
-
186,667
-
Andrew Corbett
LTI3
3,421,563
6-Nov-19
-
-
-
3,421,563
-
LTI4
1,086,301
27-Nov-20
-
-
-
-
1,086,301
LTI5
815,952
14-Dec-21
-
-
-
-
815,952
LTI6
-
6-Dec-22
-
-
-
-
1,679,215
Anthony Wehby
LTI¹
300,000
27-Nov-20
-
-
-
-
-
LTI²
69,783
14-Dec-21
-
69,783
-
Chris Drew*
LTI3
2,257,031
6-Nov-19
-
-
-
2,257,031
-
LTI4
696,926
27-Nov-20
-
-
-
580,772
LTI5
685,510
5-Nov-21
-
-
-
342,755
Stuart Rechner
LTI¹
300,000
27-Nov-20
-
-
-
-
-
LTI²
69,783
14-Dec-21
-
-
-
69,783
-
10,189,516
-
-
6,004,827
4,504,995
4 Unlisted LTI Options issued 5 August 2020 and 27 November 2020 exercisable at 1c, expiry 31 July 2023, vesting is subject to share price hurdles which were not satisfied and lapsed on 31 July 2023
5 Unlisted LTI Options issued 5 November 2021 and 14 December 2021 exercisable at 0c, expiry 31 August 2024, vesting is subject to share price hurdles
6 Unlisted LTI Options issued 6 December 2022 exercisable at 0c, expiry 31 August 2028, vesting is subject to share price hurdles
3 Unlisted LTI Options issued 6 November 2019 exercisable at 1c, expiry 31 July 2023, vesting is subject to operational hurdles being satisfied, fully exercised on 31 July 2023
*balance at the date of retirement
11,868,731
462,631
1,358,909
¹ Unlisted LTI Options issued 27 November 2020 exercisable at 50c - expiry on 30 June 2023
300,000
15,584
300,000
2 Unlisted LTI Service Fee Options issued 14 December 2021 exercisable at 0c - expiry on 14 December 2024, fully exercised on 17 August 2023
36,003
116,154
69,783
11,165
-
300,000
15,584
300,000
186,667
29,867
-
685,510
7,743
342,755
69,783
11,165
3,421,563
137,644
-
2,257,031
90,797
-
696,926
No.
$
$
300,000
15,584
300,000
1,086,301
56,118
-
815,952
7,970
-
27,407
1,679,215
-
Balance at Beginning of
Year
No.
Value
Value
Grant
Details
Vested
2024
Issue Date
No.
Balance at End
of Year
Andrew Corbett
STI232
2,099,018
6-Dec-22
-
-
2,099,018
-
-
Lapsed
No.
Value
Value
No.
Balance at Beginning
of Year
2,099,018
13,098
-
$
$
2,099,018
13,098
-
2,099,018
2,099,018
2023
Issue Date
No.
Balance at End
of Year
Andrew Corbett
STI221
1,019,940
14-Dec-21
178,489
-
STI232
-
6-Dec-22
-
2,099,018
Chris Drew*
STI221
856,888
5-Nov-21
167,093
-
1,876,828
345,582
2,099,018
$
$
Grant Details
Vested
13,098
-
-
Lapsed
Balance at Beginning
of Year
No.
Value
Value
No.
1,019,940
13,259
2,320
841,451
1 STI22 Performance Rights issued on 5 November 2021 and 14 December 2021 will vest as follows: (a) Up to 40% of STI Performance Rights will automatically vest if the Company’s June 2022 VWAP
is between 120% to 150% of the Company’s June 2021 VWAP; and (b) Up to 60% of the STI Performance Rights will vest, at the Board’s discretion, upon the achievement of operational performance
measures before 30 June 2022. All STI Performance Rights that have not vested by 31 August 2022 will automatically lapse and be forfeited.
2 STI23 Performance Rights issued on 6 December 2022 will vest as follows:
(a) Up to 40% of STI Performance Rights will automatically vest if the Company’s June 2023 VWAP is between 120% to 150% of the Company’s June 2022 VWAP; and
(b) Up to 60% of the STI Performance Rights will vest, at the Board’s discretion, upon the achievement of operational performance measures before 30 June 2023. All STI Performance Rights that have
not vested by 31 August 2023 will automatically lapse and be forfeited.
2,099,018
3,975,846
37,497
4,492
1,531,246
*balance at the date of retirement
856,888
11,140
2,172
689,795
DIRECTORS’ REPORT
KINGSTON RESOURCES LIMITED
& its Controlled Entities
- 25 -
Share holdings of KMP
The number of ordinary shares in the Company held by each KMP of the Group during the 2024 and 2023 reporting
periods is as follows:
(i)
Loans to key management personnel
There were no loans to individuals or members of KMP during the financial year or the previous financial year.
(j)
Other KMP transactions
On 14 August 2023 Shareholders approved the grant of up to $300,000 MH Project Goal Performance Options to Andrew
Corbett, subject to the following vesting conditions:
a.
Completion of process plant upgrade commissioning;
b. Announcement of commercial production; and
c.
Commencement of concentrate sales.
The earliest date on which the Options may vest is 30 June 2025. The number of options to be provided in respect of the
rights will be calculated on the basis of 20-day KSN VWAP immediately prior to the vesting condition being met. All
MH Project Options that have not vested by 31 July 2025 will automatically lapse and be forfeited. Fair value of the
options is $209,179.
There have been no other transactions involving equity instruments other than those described above. For details of other
transactions with KMP, refer to Note 22 Related Party Transactions
END OF AUDITED REMUNERATION REPORT
2024
Balance at
Beginning of
Year
Granted as
Remuneration during
the Year
Issued on Exercise of
Options/Vesting of
Performance Rights during
the Year
Other Net Changes
during the Year
Balance at End of
Year
Mick Wilkes
2,527,452 - 1,065,286 352,941 3,945,679
Andrew Corbett
4,564,618 - 3,421,563 - 7,986,181
Anthony Wehby
1,535,696 - 417,418 1,091,109 3,044,223
Stuart Rechner
431,544 - 417,418 495,319 1,344,281
9,059,310 - 5,321,685 1,939,369 16,320,364
2023
Balance at
Beginning of Year
Granted as
Remuneration during
the Year
Issued on Exercise of
Options/Vesting of
Performance Rights during
the Year
Other Net Changes
during the Year
Balance at End of
Year
Mick Wilkes
2,527,452 - - - 2,527,452
Andrew Corbett
4,386,129 - 178,489 - 4,564,618
Anthony Wehby
1,335,696 - - 200,000 1,535,696
Stuart Rechner
431,544 - - - 431,544
8,680,821 - 178,489 200,000 9,059,310
DIRECTORS’ REPORT
KINGSTON RESOURCES LIMITED
& its Controlled Entities
- 26 -
SHARE OPTIONS, PERFORMANCE RIGHTS, PERFORMANCE OPTIONS AND WARRANTS
During the 2024 reporting period, the unissued ordinary shares of the Company under option, warrants and performance
options were as follows:
1Subsequent to 30 June 2024, 983,718 options vested and 1,359,297 options lapsed.
2Subsequent to 30 June 2024, 793,414 options lapsed.
3Subsequent to 30 June 2024, 37,048 options lapsed.
4Subsequent to 30 June 2024, 301,249 options lapsed.
5Subsequent to 30 June 2024, 1,134,182 Performance Options vested and were converted to STI ZEPOs and 2,010,910 Performance Options lapsed.
On 14 August 2023, the Company granted MH Project Goal Performance Options for a total value of $900,000 to certain
employees, exercisable at nil consideration upon meeting certain vesting conditions. The earliest date on which the
Options may vest is 30 June 2025. The number of options to be provided in respect of the rights will be calculated on the
basis of 20-day KSN VWAP immediately prior to the vesting condition being met. All MH Project Options that have not
vested by 31 July 2025 will automatically lapse and be forfeited. As at the reporting date, MH Project Goal Performance
Options have not vested.
During the year ended 30 June 2024, 7,204,758 ordinary shares in the Company were issued pursuant to the exercise of
options and performance rights. During the year ended 30 June 2023, 2,257,031 ordinary shares in the Company were
issued pursuant to the exercise of options. Apart from as described in this report, there have been no conversions to, calls
of, or subscriptions for ordinary shares of issued or potential ordinary shares since the reporting date and before the
completion of these financial statements.
No person entitled to exercise an option had or has any right by virtue of the option to participate in any share issue of
any other body corporate.
PROCEEDINGS ON BEHALF OF THE GROUP
No person has applied to any court pursuant to section 237 of the Corporations Act 2001 for leave to bring proceedings
on behalf of the Group or intervene in any proceedings to which the Group is a party for the purpose of taking
responsibility on behalf of the Group for all or any part of those proceedings. The Group was not a party to any such
proceedings during the year.
Security Type
Grant Date Date of Expiry Exercise Price
Held at
Issued
Exercised
Lapsed /
Held at
1-Jul-23
Cancelled
30-Jun-24
Options
6-Nov-19
31-Jul-23
1 cent
4,561,810
-
4,561,810
-
-
Options
27-Nov-20
31-Jul-23
1 cent
2,591,840
-
-
2,591,840
-
Options
5-Nov-21
31-Aug-24
0 cents
1,377,981
-
-
-
1,377,981
Options
15-Dec-21
31-Aug-24
0 cents
815,952
-
-
-
815,952
Options
17-Jun-22
31-Aug-24
0 cents
149,082
-
-
-
149,082
Options
14-Dec-21
14-Dec-24
0 cents
326,233
-
326,233
-
-
Options
6-Dec-22
31-Aug-28
0 cents
5,171,621
-
-
-
5,171,621
Options
17-Aug-23
31-Aug-28
0 cents
-
37,048
-
-
37,048
Options
28-Nov-23
28-Nov-26
0 cents
-
699,313
699,313
-
-
Options
28-Nov-23
28-Nov-26
0 cents
-
874,576
874,576
-
-
Options
28-Nov-23
31-Aug-29
0 cents
-
6,700,843
-
-
6,700,843
Options
17-Aug-24
31-Jul-25
14 cents
-
37,251,387
-
-
37,251,387
Options
18-Aug-23
31-Jul-25
15 cents
-
758,823
-
-
758,823
Warrants
7-Jul-22
7-Jul-27
20 cents
-
25,000,000
-
-
25,000,000
Warrants
17-Aug-23
29-Jun-28
14 cents
-
35,714,286
-
-
35,714,286
Performance Rights
6-Dec-22
31-Aug-23
0 cents
6,785,845
-
742,826
6,043,019
-
Performance Options
28-Nov-23
31-Aug-27
0 cents
-
3,145,092
-
-
3,145,092
DIRECTORS’ REPORT
KINGSTON RESOURCES LIMITED
& its Controlled Entities
- 27 -
INDEMNITIES GIVEN AND INSURANCE PREMIUMS PAID TO AUDITORS AND OFFICERS
The Company has entered into Deeds of Access, Indemnity and Insurance with each Director.
Under these deeds, the Company has undertaken, subject to the restrictions in the Corporations Act, to:
a)
indemnify each Director from certain liabilities incurred from acting in that position under specified circumstances;
b)
maintain directors’ and officers’ insurance cover (if available) in favour of each Director whilst that person
maintains such office and for seven years after the Director has ceased to be a director;
c)
cease to maintain directors’ and officers’ insurance cover in favour of each Director if the Company reasonably
determines that the type of coverage is no longer available.
d)
If the Company ceases to maintain directors’ and officers’ insurance cover in favour of a Director, then the
Company must notify that Director of that event; and
e)
provide access to any Company records which are relevant to the Director’s holding of office with the Company,
for a period of seven years after the Director has ceased to be a Director.
During the year, the Company paid a premium to insure officers of the Group. The officers of the Group covered by the
insurance policy include all directors and the company secretary.
The liabilities insured are legal costs that may be incurred in defending civil or criminal proceedings that may be brought
against the officers in their capacity as officers of the Group, and any other payments arising from liabilities incurred by
the officers in connection with such proceedings, other than where such liabilities arise out of conduct involving a wilful
breach of duty by the officers or the improper use by the officers of their position or of information to gain advantage for
themselves or someone else to cause detriment to the Group.
Details of the amount of the premium paid in respect of the insurance policies is not disclosed as such disclosure is
prohibited under the terms of the contract.
The Group has not otherwise, during or since the end of the financial year, except to the extent permitted by law,
indemnified or agreed to indemnify any current or former officer or auditor of the Group against a liability incurred as
such by an officer or auditor.
AUDIT COMMITTEE
The Board has established a separate Audit and Risk Management Committee to assist the Board to discharge its corporate
governance duties in relation to implementing and maintaining appropriate policies and procedures relating to risk
management, financial reporting, external and internal control and auditing.
NON-AUDIT SERVICES
During the year the Company’s auditor provided taxation services to the Company at a total cost of $21,472.
DIRECTORS’ REPORT
KINGSTON RESOURCES LIMITED
& its Controlled Entities
- 28 -
AUDITORS’ INDEPENDENCE DECLARATION
A copy of the auditor’s independence declaration as required by section 307C of the Corporations Act 2001 is included
in this Annual Report. Hall Chadwick continues in office in accordance with section 327 of the Corporations Act 2001.
Pursuant to section 298(2) Corporations Act, this Directors’ Report:
a)
is made in accordance with a resolution of the Directors; and
b)
is dated 13 September 2024 and
c)
is signed by Mr Mick Wilkes.
Mick Wilkes
Non-Executive Chair
Sydney, New South Wales
13 September 2024
KINGSTON RESOURCES LIMITED
ABN 44 009 148 529
AND CONTROLLED ENTITIES
AUDITOR’S INDEPENDENCE DECLARATION
UNDER SECTION 307C OF THE CORPORATIONS ACT 2001
TO THE DIRECTORS OF KINGSTON RESOURCES LIMITED
In accordance with section 307C of the Corporations Act 2001, I am pleased to provide the following declaration
of independence to the directors of Kingston Resources Limited. As the lead audit partner for the audit of the
financial report of Kingston Resources Limited for the year ended 30 June 2024, I declare that, to the best of my
knowledge and belief, there have been no contraventions of:
(i)
the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
(ii)
any applicable code of professional conduct in relation to the audit.
HALL CHADWICK (NSW)
Level 40, 2 Park Street
Sydney NSW 2000
ANTHONY TRAVERS
Partner
Dated: 13 September 2024
CONSOLIDATED STATEMENT OF PROFIT OR LOSS
KINGSTON RESOURCES LIMITED
as at 30 June 2024
& its Controlled Entities
- 30 -
Consolidated Statement of Financial Position
Notes
Consolidated Group
2024
2023
$
$
Current assets
Cash and cash equivalents
9
8,357,776
18,206,767
Trade and other receivables
10
515,345
1,315,211
Available for sale financial assets
11
287,900
269,150
Inventory
2,049,895
3,030,080
Other current assets
401,454
278,752
Total current assets
11,612,370
23,099,960
Non-current assets
Property, plant and equipment
13
29,121,694
17,256,109
Capitalised exploration expenditure
23
49,759,508
46,079,669
Mine & Resource development expenditure
23
22,865,123
16,650,984
Right of use assets
5
703,495
935,006
Other non-current assets
14
7,555,209
7,399,044
Total non-current assets
110,005,029
88,320,812
Total assets
121,617,399
111,420,772
Current liabilities
Trade and other payables
15
8,746,694
7,907,917
Interest bearing loan
173,164
42,796
Lease liabilities
5
256,781
360,334
Employee Provisions
660,547
539,486
Deferred Payables
27
4,158,967
9,579,789
Total current liabilities
13,996,153
18,430,322
Non-current liabilities
Borrowings
26
9,104,811
8,822,176
Lease liabilities
5
188,019
400,687
Rehabilitation Provision
7,465,000
7,274,000
Employee Provisions
81,892
38,687
Total non-current liabilities
16,839,722
16,535,550
Total liabilities
30,835,875
34,965,872
Net assets
90,781,524
76,454,900
Equity
Issued capital
16
139,856,904
121,170,385
Advanced Placement Fund (net)
-
3,867,452
Accumulated losses
(51,353,844)
(50,812,957)
Share based payment reserve
21
2,121,133
2,043,126
Foreign currency translation reserve
157,331
186,894
Total equity
90,781,524
76,454,900
The above Consolidated Statement of Financial Position should be read in conjunction with the accompanying notes.
CONSOLIDATED STATEMENT OF PROFIT OR LOSS
KINGSTON RESOURCES LIMITED
as at 30 June 2024
& its Controlled Entities
- 31 -
Consolidated Statement of Profit or Loss and
Other Comprehensive Income
Notes
Consolidated Group
2024
2023
$
$
Continuing Operations
Sales
39,277,245
44,753,992
Other income
2
56,674
21,238
Cost of sales
(21,696,786)
(20,985,979)
Gross Profit
17,637,133
23,789,251
Administration expenses
(576,527)
(532,142)
Employee benefits
(7,724,264)
(7,041,660)
Consultant and legal fees
(152,093)
(111,996)
Depreciation expense
3
(4,686,219)
(3,375,375)
Amortisation expense
(2,028,395)
(1,075,696)
Director fees
(332,956)
(285,730)
Share based payments expense
(507,482)
(314,996)
Financing costs
(1,341,077)
(777,088)
Other expenses
(6,8096)
-
Financial assets fair value gain/(loss)
18,750
(293,750)
Foreign Exchange (Loss)
(1,020,414)
(173,591)
(Loss)/Profit before income tax expense
(720,353)
9,807,227
Income tax expense
4
-
-
(Loss)/Profit for the year
(720,353)
9,807,227
Other comprehensive (Loss)/Income
Other comprehensive (Loss) – net of tax
(29,563)
(19,894)
Total comprehensive (Loss)/Income for the year
(749,916)
9,787,333
Basic (Loss)/Profit per share (cents)
8
(0.14)
2.37
Diluted (Loss)/Profit per share (cents)
8
(0.14)
2.13
The above Consolidated Statement of Profit or Loss and Other Comprehensive Income should be read in conjunction with
the accompanying notes.
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
KINGSTON RESOURCES LIMITED
for the year ended 30 June 2024
& its Controlled Entities
- 32 -
Consolidated Statement of Changes in Equity
Attributable to the shareholders of Kingston Resources Limited
Ordinary
Shares
Advanced
Placement
Fund
Accumulated
Losses
Foreign
Exchange
Reserves
Share Based
Payment
Reserve
Total Equity
$
$
$
$
$
$
Balance at 1 July 2022
121,051,877
-
(60,738,440)
206,788
609,952
61,130,177
Profit for the full year
-
-
9,807,227
-
-
9,807,227
Total comprehensive income
-
-
-
(19,894)
-
(19,894)
121,051,877
-
(50,931,213)
186,894
609,952
70,917,510
Issue of Shares
22,570
-
-
-
-
22,570
T1 Placement monies
-
4,500,000
-
-
-
4,500,000
Cost of share issue
(2,500)
(302,255)
-
-
-
(304,755)
Share based payments
-
(330,293)
-
-
1,649,868
1,319,575
Transfer from Share Based Payment
Reserve on vesting/lapsing of
securities
98,438
-
118,256
-
(216,694)
-
Balance at 30 June 2023
121,170,385
3,867,452
(50,812,957)
186,894
2,043,126
76,454,900
Balance at 1 July 2023
121,170,385
3,867,452
(50,812,957)
186,894
2,043,126
76,454,900
Loss for the full year
-
-
(720,353)
-
-
(720,353)
Total comprehensive income
-
-
-
(29,563)
-
(29,563)
121,170,385
3,867,452
(51,533,310)
157,331
2,043,126
75,704,984
Issue of Shares
15,554,661
-
-
-
-
15,554,661
T1 Placement monies
4,500,000
(4,500,000)
-
-
-
-
Cost of share issue
(1,272,447)
302,255
-
-
-
(970,192)
Share based payments
(468,379)
330,293
-
-
623,348
485,262
Transfer from Share Based Payment
Reserve on vesting/lapsing of
securities
372,684
-
172,657
-
(545,341)
-
Loss on dissolution of subsidiary
-
-
6,809
-
-
6,809
Balance at 30 June 2024
139,856,904
-
(51,353,844)
157,331
2,121,133
90,781,524
The above Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying notes.
CONSOLIDATED STATEMENT OF CASH FLOWS
KINGSTON RESOURCES LIMITED
for the year ended 30 June 2024
& its Controlled Entities
- 33 -
Consolidated Statement of Cash Flows
Notes
Consolidated Group
2024
2023
$
$
Cash flows from operating activities
Continued operations
Receipts from customers
39,322,311
44,774,911
Interest received
38,674
3,238
Government Grants
175,000
250,000
Payments to suppliers and employees
(33,656,880)
(29,533,911)
Net cash used in operating activities
20
5,879,105
15,494,238
Cash flows from investing activities
Payment for exploration and evaluation/Mine Development
(9,722,700)
(8,830,323)
Net payment for environmental bond and security deposits
(127,792)
(3,746,109)
Payment for acquisition of Mineral Hill Pty Ltd
(5,697,009)
(2,915,629)
Proceeds from divestment of WesternX Pty Ltd
-
1,500,000
Payment for PPE
(13,691,223)
(2,792,869)
Net cash used in investing activities
(29,238,724)
(16,784,930)
Cash flows from financing activities
Proceeds from issue of shares and options
14,532,104
22,570
Advanced placement fund
-
4,226,629
Transaction costs related to issue of shares, convertibles, or options
(982,589)
(2,500)
Proceeds from borrowings
-
9,700,000
Repayment of interest bearing liabilities
(37,130)
(41,230)
Net cash provided by financing activities
13,512,385
13,905,469
Net change in cash and cash equivalents held
(9,847,234)
12,614,777
Cash and cash equivalents at beginning of financial year
18,206,767
5,589,673
Effect of movement in exchange rate on cash held
(1,757)
2,317
Cash and cash equivalents at end of financial year
9
8,357,776
18,206,767
The above Consolidated Statement of Cash Flows should be read in conjunction with the accompanying notes.
NOTES TO THE FINANCIAL STATEMENTS
KINGSTON RESOURCES LIMITED
for the year ended 30 June 2024
& its Controlled Entities
- 34 -
Notes to the Financial Statements
This financial report includes the consolidated financial statements and notes of Kingston Resources Limited and
controlled entities (‘Consolidated Group’ or ‘Group’).
For the purpose of preparing the consolidated financial statements, the Company is a for-profit entity.
Note 1: Statement of Material Accounting Policies
The financial report is a general purpose financial report that has been prepared in accordance with Australian Accounting
Standards including Australian Accounting Interpretations, other authoritative pronouncements of the Australian
Accounting Standards Board and the Corporations Act 2001. The consolidated financial statements are presented in the
currency of Australian dollars.
Statement of Compliance
Compliance with Australian Accounting Standards ensures that the financial statements and notes of Kingston Resources
Limited and its controlled entities comply with International Financial Reporting Standards (IFRS).
The financial statements were authorised for issue by the directors on 13 September 2024.
Basis of Preparation
The financial statements have been prepared on an accrual basis and are based on historical costs modified by the
revaluation of selected non-current assets, financial assets and financial liabilities for which the fair value basis of
accounting has been applied.
Significant Accounting Policies
a)
Principles of Consolidation
The Group financial statements consolidate those of the Parent Company and all of its subsidiaries as of 30 June
2024. The Parent controls a subsidiary if it is exposed, or has rights, to variable returns from its involvement with
the subsidiary and has the ability to affect those returns through its power over the subsidiary. All subsidiaries
have a reporting date of 30 June. A list of controlled entities is contained in Note 12 to the financial statements.
All transactions and balances between Group companies are eliminated on consolidation, including unrealised
gains and losses on transactions between Group companies. Where unrealised losses on intra-group asset sales are
reversed on consolidation, the underlying asset is also tested for impairment from a group perspective. Amounts
reported in the financial statements of subsidiaries have been adjusted where necessary to ensure consistency with
the accounting policies adopted by the Group.
Profit or loss and other comprehensive income of subsidiaries acquired or disposed of during the year are
recognised from the effective date of acquisition, or up to the effective date of disposal, as applicable.
Non-controlling interests, presented as part of equity, represent the portion of a subsidiary’s profit or loss and net
assets that is not held by the Group. The Group attributes total comprehensive income or loss of subsidiaries
between the owners of the parent and the non-controlling interests based on their respective ownership interests.
b)
Changes in Accounting Policies
The Group has considered the implications of new or amended Accounting Standards which have become
applicable for the current financial reporting period.
c)
New Accounting Standards and Interpretations
Australian Accounting Standards and Interpretations that have recently been issued or amended but are not yet
mandatory, have not been early adopted by the consolidated entity for the annual reporting period ended 30 June
2024.
NOTES TO THE FINANCIAL STATEMENTS
KINGSTON RESOURCES LIMITED
for the year ended 30 June 2024
& its Controlled Entities
- 35 -
d)
Income Tax
The income tax expense (revenue) for the year comprises current income tax expense (income) and deferred tax
expense (income). Current and deferred income tax expense (income) is charged or credited directly to other
comprehensive income instead of the profit or loss when the tax relates to items that are credited or charged directly
to other comprehensive income.
Current tax
Current income tax expense charged to the profit or loss is the tax payable on taxable income calculated using
applicable income tax rates enacted, or substantially enacted, as at reporting date. Current tax liabilities (assets)
are therefore measured at the amounts expected to be paid to (recovered from) the relevant taxation authority.
Current tax assets and liabilities are offset where a legally enforceable right of set-off exists and its intended that
net settlement or simultaneous realisation and settlement of the respective asset and liability will occur.
Deferred tax
Deferred income tax expense reflects movements in deferred tax asset and deferred tax liability balances during
the year as well unused tax losses.
Deferred tax assets and liabilities are ascertained based on temporary differences arising between the tax bases of
assets and liabilities and their carrying amounts in the financial statements. Deferred tax assets also result where
amounts have been fully expensed but future tax deductions are available. No deferred income tax will be
recognised from the initial recognition of an asset or liability, excluding a business combination, where there is no
effect on accounting or taxable profit or loss.
Deferred tax assets and liabilities are offset where a legally enforceable right of set-off exists, the deferred tax
assets and liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity
or different taxable entities where it is intended that net settlement or simultaneous realisation and settlement of
the respective asset and liability will occur in future periods in which significant amounts of deferred tax assets or
liabilities are expected to be recovered or settled.
Tax consolidation
Kingston Resources Limited and its wholly-owned Australian subsidiaries have formed an income tax
consolidated group under the tax consolidation legislation. Each entity in the Group recognises its own current and
deferred tax liabilities. Such taxes are measured using the ‘stand-alone taxpayer’ approach to allocation. Current
tax liability (assets) and deferred tax assets arising from unused tax losses and tax credits in the subsidiaries are
immediately transferred to the head entity. The Group notified the Australian Taxation Office that it had formed
an income tax consolidated group to apply from 1 July 2003.
e)
Property, Plant and Equipment
Each class of property, plant and equipment is carried at cost or fair value less, where applicable any accumulated
depreciation and impairment losses.
Plant and equipment
Plant and equipment are measured on the cost basis.
The carrying amount of plant and equipment is reviewed annually by directors to ensure it is not in excess of the
recoverable amount from these assets. The recoverable amount is assessed on the basis of the expected net cash
flows that will be received from the assets employment and subsequent disposal.
Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only
when it is probable that future economic benefits associated with the item will flow to the group and the cost of
the item can be measured reliably. All other repairs and maintenance are charged to profit or loss on the statement
of profit or loss and other comprehensive income.
Depreciation
The depreciable amount of all fixed assets is depreciated using the straight line method commencing from the time
the asset is held ready for use.
NOTES TO THE FINANCIAL STATEMENTS
KINGSTON RESOURCES LIMITED
for the year ended 30 June 2024
& its Controlled Entities
- 36 -
The depreciation rates used for each class of depreciable asset are:
Class of Fixed Assets
Depreciation Rate
Motor Vehicles
20-25%
Buildings
10-33%
Plant & Equipment
10-50%
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each reporting date.
An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount
is greater than its estimated recoverable amount.
Gains and losses on disposals are determined by comparing proceeds with the carrying amount. The gains and
losses are included in profit or loss in the statement of profit or loss and other comprehensive income. When
revalued assets are sold, amounts included in the revaluation reserve relating to that asset are transferred to retained
earnings.
f)
Leases
At inception of a contract the Group assesses if the contract contains or is a lease. If there is a lease present and
the Group is the lessee, a right-of-use asset and a corresponding lease liability is recognised. However, all contracts
that are classified as short-term leases (i.e. a lease with a remaining lease term of 12 months or less) and leases of
low-value assets are recognised as an operating expense on a straight-line basis over the term of the lease.
Initially, the lease liability is measured at the present value of the lease payments still to be paid at commencement
date. The lease payments are discounted at the interest rate implicit in the lease. If this rate cannot be readily
determined, the Group uses the incremental borrowing rate.
Lease payments included in the measurement of the lease liability are as follows:
•
fixed lease payments less any lease incentives;
•
variable lease payments that depend on an index or rate, initially measured using the index or rate at the
commencement date;
•
the amount expected to be payable by the lessee under residual value guarantees;
•
the exercise price of purchase options, if the lessee is reasonably certain to exercise the options;
•
lease payments under extension options, if lessee is reasonably certain to exercise the options; and
•
payments of penalties for terminating the lease, if the lease term reflects the exercise of an option to
terminate the lease.
The right-of-use assets comprise the initial measurement of the corresponding lease liability as mentioned above,
any lease payments made at or before the commencement date, as well as any initial direct costs. The subsequent
measurement of the right-of-use assets is at cost less accumulated depreciation and impairment losses.
Right-of-use assets are depreciated over the lease term or useful life of the underlying asset, whichever is the
shortest. Where a lease transfers ownership of the underlying asset, or the cost of the right-of-use asset reflects
that the Group anticipates to exercise a purchase option, the specific asset is depreciated over the useful life of the
underlying asset.
g)
Fair Value of Assets and Liabilities
The Group measures some of its assets and liabilities at fair value on either a recurring or non-recurring basis,
depending on the requirements of the applicable Accounting Standard.
Fair value is the price the Group would receive to sell an asset or would have to pay to transfer a liability in an
orderly (i.e. unforced) transaction between independent, knowledgeable and willing market participants at the
measurement date.
NOTES TO THE FINANCIAL STATEMENTS
KINGSTON RESOURCES LIMITED
for the year ended 30 June 2024
& its Controlled Entities
- 37 -
As fair value is a market-based measure, the closest equivalent observable market pricing information is used to
determine fair value. Adjustments to market values may be made having regard to the characteristics of the specific
asset or liability. The fair values of assets and liabilities that are not traded in an active market are determined
using one or more valuation techniques. These valuation techniques maximise, to the extent possible, the use of
observable market data.
To the extent possible, market information is extracted from either the principal market for the asset or liability
(i.e. the market with the greatest volume and level of activity for the asset or liability) or, in the absence of such a
market, the most advantageous market available to the entity at the end of the reporting period (i.e. the market that
maximises the receipts from the sale of the asset or minimises the payments made to transfer the liability, after
taking into account transaction costs and transport costs).
For non-financial assets, the fair value measurement also takes into account a market participant’s ability to use
the asset in its highest and best use or to sell it to another market participant that would use the asset in its highest
and best use.
The fair value of liabilities and the entity’s own equity instruments (excluding those related to share-based payment
arrangements) may be valued, where there is no observable market price in relation to the transfer of such financial
instruments, by reference to observable market information where such instruments are held as assets. Where this
information is not available, other valuation techniques are adopted and, where significant, are detailed in the
respective note to the financial statements.
h)
Financial Instruments
Initial recognition and measurement
Financial assets and financial liabilities are recognised when the Group becomes a party to the contractual
provisions to the instrument. For financial assets, this is the date that the Group commits itself to either the purchase
or sale of the asset (i.e. trade date accounting is adopted).
Financial instruments (except for trade receivables) are initially measured at fair value plus transaction costs,
except where the instrument is classified "at fair value through profit or loss", in which case transaction costs are
expensed to profit or loss immediately. Where available, quoted prices in an active market are used to determine
fair value. In other circumstances, valuation techniques are adopted.
Trade receivables are initially measured at the transaction price if the trade receivables do not contain a significant
financing component or if the practical expedient was applied as specified in AASB 15.63.
Classification and subsequent measurement
Financial liabilities
Financial instruments are subsequently measured at:
-
amortised cost; or
-
fair value through profit or loss.
A financial liability is measured at fair value through profit and loss if the financial liability is:
-
a contingent consideration of an acquirer in a business combination to which AASB 3: Business
Combinations applies;
-
held for trading; or
-
initially designated as at fair value through profit or loss.
All other financial liabilities are subsequently measured at amortised cost using the effective interest method.
The effective interest method is a method of calculating the amortised cost of a debt instrument and of allocating
interest expense in profit or loss over the relevant period. The effective interest rate is the internal rate of return of
the financial asset or liability. That is, it is the rate that exactly discounts the estimated future cash flows through
the expected life of the instrument to the net carrying amount at initial recognition.
A financial liability is held for trading if:
-
it is incurred for the purpose of repurchasing or repaying in the near term;
NOTES TO THE FINANCIAL STATEMENTS
KINGSTON RESOURCES LIMITED
for the year ended 30 June 2024
& its Controlled Entities
- 38 -
-
part of a portfolio where there is an actual pattern of short-term profit taking; or
-
a derivative financial instrument (except for a derivative that is in a financial guarantee contract or a
derivative that is in a effective hedging relationships).
Any gains or losses arising on changes in fair value are recognised in profit or loss to the extent that they are not
part of a designated hedging relationship are recognised in profit or loss.
The change in fair value of the financial liability attributable to changes in the issuer's credit risk is taken to other
comprehensive income and are not subsequently reclassified to profit or loss. Instead, they are transferred to
retained earnings upon derecognition of the financial liability. If taking the change in credit risk in other
comprehensive income enlarges or creates an accounting mismatch, then these gains or losses should be taken to
profit or loss rather than other comprehensive income.
A financial liability cannot be reclassified.
Financial assets
Financial assets are subsequently measured at:
-
amortised cost;
-
fair value through other comprehensive income; or
-
fair value through profit or loss.
Measurement is on the basis of two primary criteria:
-
the contractual cash flow characteristics of the financial asset; and
-
the business model for managing the financial assets.
A financial asset that meets the following conditions is subsequently measured at amortised cost:
-
the financial asset is managed solely to collect contractual cash flows; and
-
the contractual terms within the financial asset give rise to cash flows that are solely payments of principal
and interest on the principal amount outstanding on specified dates.
A financial asset that meets the following conditions is subsequently measured at fair value through other
comprehensive income:
-
the contractual terms within the financial asset give rise to cash flows that are solely payments of principal
and interest on the principal amount outstanding on specified dates;
-
the business model for managing the financial assets comprises both contractual cash flows collection
and the selling of the financial asset.
By default, all other financial assets that do not meet the measurement conditions of amortised cost and fair value
through other comprehensive income are subsequently measured at fair value through profit or loss.
The Group initially designates a financial instrument as measured at fair value through profit or loss if:
-
it eliminates or significantly reduces a measurement or recognition inconsistency (often referred to as
“accounting mismatch”) that would otherwise arise from measuring assets or liabilities or recognising the
gains and losses on them on different bases;
-
it is in accordance with the documented risk management or investment strategy, and information about
the groupings was documented appropriately, so that the performance of the financial liability that was
part of a group of financial liabilities or financial assets can be managed and evaluated consistently on a
fair value basis;
-
it is a hybrid contract that contains an embedded derivative that significantly modifies the cash flows
otherwise required by the contract.
NOTES TO THE FINANCIAL STATEMENTS
KINGSTON RESOURCES LIMITED
for the year ended 30 June 2024
& its Controlled Entities
- 39 -
The initial designation of the financial instruments to measure at fair value through profit or loss is a one-time
option on initial classification and is irrevocable until the financial asset is derecognised.
Equity instruments
At initial recognition, as long as the equity instrument is not held for trading and not a contingent consideration
recognised by an acquirer in a business combination to which AASB 3: Business Combinations applies, the Group
made an irrevocable election to measure any subsequent changes in fair value of the equity instruments in other
comprehensive income, while the dividend revenue received on underlying equity instruments investment will still
be recognised in profit or loss.
Regular way purchases and sales of financial assets are recognised and derecognised at settlement date in
accordance with the Group's accounting policy.
Derecognition
Derecognition refers to the removal of a previously recognised financial asset or financial liability from the
statement of financial position.
Derecognition of financial liabilities
A liability is derecognised when it is extinguished (i.e. when the obligation in the contract is discharged, cancelled
or expires). An exchange of an existing financial liability for a new one with substantially modified terms, or a
substantial modification to the terms of a financial liability is treated as an extinguishment of the existing liability
and recognition of a new financial liability.
The difference between the carrying amount of the financial liability derecognised and the consideration paid and
payable, including any non-cash assets transferred or liabilities assumed, is recognised in profit or loss.
Derecognition of financial assets
A financial asset is derecognised when the holder's contractual rights to its cash flows expires, or the asset is
transferred in such a way that all the risks and rewards of ownership are substantially transferred.
All of the following criteria need to be satisfied for derecognition of financial asset:
-
the right to receive cash flows from the asset has expired or been transferred;
-
all risk and rewards of ownership of the asset have been substantially transferred; and
-
the Group no longer controls the asset (i.e. the Group has no practical ability to make a unilateral decision
to sell the asset to a third party).
On derecognition of a financial asset measured at amortised cost, the difference between the asset's carrying
amount and the sum of the consideration received and receivable is recognised in profit or loss.
On derecognition of a debt instrument classified as at fair value through other comprehensive income, the
cumulative gain or loss previously accumulated in the investment revaluation reserve is reclassified to profit or
loss.
On derecognition of an investment in equity which was elected to be classified under fair value through other
comprehensive income, the cumulative gain or loss previously accumulated in the investment revaluation reserve
is not reclassified to profit or loss, but is transferred to retained earnings.
Impairment
The Group recognises a loss allowance for expected credit losses on:
-
financial assets that are measured at amortised cost or fair value through other comprehensive income;
-
lease receivables;
-
contract assets (e.g. amounts due from customers under construction contracts);
-
loan commitments that are not measured at fair value through profit or loss; and
-
financial guarantee contracts that are not measured at fair value through profit or loss.
Loss allowance is not recognised for:
-
financial assets measured at fair value through profit or loss; or
NOTES TO THE FINANCIAL STATEMENTS
KINGSTON RESOURCES LIMITED
for the year ended 30 June 2024
& its Controlled Entities
- 40 -
-
equity instruments measured at fair value through other comprehensive income.
Expected credit losses are the probability-weighted estimate of credit losses over the expected life of a financial
instrument. A credit loss is the difference between all contractual cash flows that are due and all cash flows
expected to be received, all discounted at the original effective interest rate of the financial instrument.
The Group uses the general approach to impairment, as applicable under AASB 9: Financial Instruments:
Under the general approach, at each reporting period, the Group assesses whether the financial instruments are
credit-impaired, and if:
-
the credit risk of the financial instrument has increased significantly since initial recognition, the Group
measures the loss allowance of the financial instruments at an amount equal to the lifetime expected credit
losses; or
-
there is no significant increase in credit risk since initial recognition, the Group measures the loss
allowance for that financial instrument at an amount equal to 12-month expected credit losses.
Recognition of expected credit losses in financial statements
At each reporting date, the Group recognises the movement in the loss allowance as an impairment gain or loss in
the statement of profit or loss and other comprehensive income.
The carrying amount of financial assets measured at amortised cost includes the loss allowance relating to that
asset.
Assets measured at fair value through other comprehensive income are recognised at fair value, with changes in
fair value recognised in other comprehensive income. Amounts in relation to change in credit risk are transferred
from other comprehensive income to profit or loss at every reporting period.
For financial assets that are unrecognised (e.g. loan commitments yet to be drawn, financial guarantees), a
provision for loss allowance is created in the statement of financial position to recognise the loss allowance.
i)
Impairment of Non-Financial Assets
At each reporting date, the Group reviews the carrying values of its tangible and intangible assets to determine
whether there is any indication that those assets have been impaired. If such an indication exists, the recoverable
amount of the asset, being the higher of the asset’s fair value less costs to sell and value in use, is compared to the
asset’s carrying value. Any excess of the asset’s carrying value over its recoverable amount is expensed to the
statement of profit or loss and other comprehensive income.
Where it is not possible to estimate the recoverable amount of an individual asset, the Group estimates the
recoverable amount of the cash-generating unit to which the asset belongs.
j)
Foreign Currency Transactions and Balances
Functional and presentation currency
The functional currency of each of the Group’s entities is measured using the currency of the primary economic
environment in which that entity operates. The consolidated financial statements are presented in Australian dollars
which is the parent entity’s functional and presentation currency.
Transaction and balances
Foreign currency transactions are translated into functional currency using the exchange rates prevailing at the
date of the transaction.
Exchange differences arising on the translation of monetary items are recognised in profit or loss, except where
deferred in equity as a qualifying cash flow or net investment hedge in which case they would be recognised in
other comprehensive income.
k)
Employee Benefits
Provision is made for the Company’s liability for employee benefits arising from services rendered by employees
to reporting date. Employee benefits that are expected to be settled wholly within one year have been measured at
the amounts expected to be paid when the liability is settled plus related on costs. Employee benefits payable later
than one year have been measured at the present value of the estimated future cash outflows to be made for those
benefits.
NOTES TO THE FINANCIAL STATEMENTS
KINGSTON RESOURCES LIMITED
for the year ended 30 June 2024
& its Controlled Entities
- 41 -
Equity-settled compensation
The Group operates a share-based compensation plan which includes a share option arrangement. The bonus
element over the exercise price of the employee’s services rendered in exchange for the grant of options is
recognised as an expense in the statement of profit or loss and other comprehensive income, with a corresponding
increase to an equity account. The total amount to be expensed over the vesting period is determined by reference
to the fair value of the shares of the options granted. The fair value of options is ascertained using a Black-Scholes
pricing model which incorporates all market vesting conditions, the fair value of Performance Rights is ascertained
using the Monte Carlo method.
l)
Cash and Cash Equivalents
Cash and cash equivalents include cash on hand, deposits held at call with banks and other short-term highly liquid
investments with original maturities of three months or less.
m)
Provisions
Provisions are recognised when the Group has a legal or constructive obligation, as a result of past events, for
which it is probable that an outflow of economic benefits will result and that outflow can be reliably measured.
n)
Revenue and Other Income
Interest revenue is recognised on a proportional basis taking into account the interest rates applicable to the
financial assets.
Research and development credits are treated as Other Income and recognised to the extent that the related
expenditure has been expensed in the Statement of Profit and Loss and Other Comprehensive Income. Research
and development credits that pertain to expenditure on any capitalised amounts remaining on the Statement of
Financial Position are deferred accordingly to be recognised in-line with expensing of those items.
All revenue is stated net of the amount of goods and services tax (GST).
o)
Mine Development
Mine development expenditures incurred are capitalised in respect of each identifiable area of interest where there
is a reasonable assessment of existence of recoverable reserves. These costs are only capitalised to the extent that
they are expected to be realised through production and sale of mineral resources identified.
When production commences, the accumulated costs for the relevant area of interest are amortised over the life of
the area according to the rate of depletion of the economically recoverable reserves.
A regular review is undertaken of each area of interest to determine the appropriateness of continuing to capitalise
costs in relation to that area of interest.
p)
Exploration Expenditure
Exploration, evaluation and development expenditures incurred are capitalised in respect of each identifiable area
of interest. These costs are only capitalised to the extent that they are expected to be recovered through the
successful development of the area or where activities in the area have not yet reached a stage that permits
reasonable assessment of the existence of economically recoverable reserves.
Accumulated costs in relation to an abandoned area are written off in full against profit in the year in which the
decision to abandon the area is made.
When production commences, the accumulated costs for the relevant area of interest are amortised over the life of
the area according to the rate of depletion of the economically recoverable reserves.
A regular review is undertaken of each area of interest to determine the appropriateness of continuing to capitalise
costs in relation to that area of interest.
Costs of site restoration are provided over the life of the project from when exploration commences and are
included in the costs of that stage. Site restoration costs include the dismantling and removal of mining plant,
equipment and building structures, waste removal, and rehabilitation of the site in accordance with local laws and
regulations and clauses of the permits. Such costs have been determined using estimates of future costs, current
legal requirements and technology on an undiscounted basis.
Any changes in the estimates for the costs are accounted on a prospective basis. In determining the costs of site
restoration, there is uncertainty regarding the nature and extent of the restoration due to community expectations
NOTES TO THE FINANCIAL STATEMENTS
KINGSTON RESOURCES LIMITED
for the year ended 30 June 2024
& its Controlled Entities
- 42 -
and future legislation. Accordingly the costs have been determined on the basis that the restoration will be
completed within one year of abandoning the site.
q)
Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred
is not recoverable from the Australian Taxation Office. In these circumstances the GST is recognised as part of
the cost of acquisition of the asset or as part of an item of the expense. Receivables and payables in the statement
of financial position are shown inclusive of GST.
Cash flows are presented in the statement of cash flows on a gross basis, except for the GST component of investing
and financing activities, which are disclosed as operating cash flows.
r)
Comparative Figures
When required by Accounting Standards, comparative figures have been adjusted to conform to changes in
presentation for the current financial year.
s)
Going Concern
The consolidated entity has earned an operating loss of $720,353 (2023: Profit $9,807,227) and positive operating
cash flows of $5,879,105 (2023 $15,494,238) for the year ended 30 June 2024. The consolidated entity’s net
current liability position as at 30 June 2024 was $2,383,783 (2023: Net current assets $4,669,638) including
$8,357,776 in cash (2023: $18,206,767).
During the year the following significant equity and debt raisings were made:
•
On 2 April 2024, the Company announced its intention to undertake a Share Placement Offer and an
Accelerated Non-Renounceable Rights Issue Offer (ANREO) raising a total of $13.48 Million. On 8
April 2024, a total of 135,732,433 shares were issued at $0,065 raising $8,091,880 under the
Placement Offer and $730,728 raised under the accelerated component of the ANREO. On 15 May
2024, a total of 71,751,815 shares were issued at $0.065 raising $4,663,867 under the retail component
of the ANREO.
For details on the remaining shares issued during the year see Note 16.
The entity has planned to use these funds largely on Life of Mine exploration and development activities, the
expenditure of which can be varied and applied discretionarily.
The Group’s cash balance of $8,357,776 as at 30 June 2024 leaves it with sufficient funding to continue to meet
operational expenditure requirements, including minimum exploration commitments across its tenement portfolio.
Nevertheless, the nature of an exploration and development company is to have negative cash flow from operations
and investing activities, and as such the Company may need to raise equity from time to time as successfully
demonstrated most recently in April 2024 and May 2024. If the Group is unsuccessful in raising capital, a material
uncertainty exists, that may cast significant doubt on the Group’s ability as a going concern and its ability to
recover assets, and discharge liabilities in the normal course of business and at the amount shown in the financial
statements. The financial statements do not include any adjustments relating to the recoverability and classification
of recorded asset amounts or to the amounts and classification of liabilities that might be necessary should the
Group not continue as a going concern.
Taking into account the current cash reserves of the Company, the Directors are confident the Company has
adequate resources to continue in its main business activity for the foreseeable future. As a result, the financial
statements have been prepared on the basis of going concern which contemplates continuity of normal business
activities and the realisation of assets and settlement of liabilities in the ordinary course of business and at the
amounts stated in the financial report.
NOTES TO THE FINANCIAL STATEMENTS
KINGSTON RESOURCES LIMITED
for the year ended 30 June 2024
& its Controlled Entities
- 43 -
t)
Joint arrangements and associates
Associates are those entities over which the Group is able to exert significant influence but which are not
subsidiaries.
A joint venture is an arrangement that the Group controls jointly with one or more other investors, and over which
the Group has rights to a share of the arrangement’s net assets rather than direct rights to underlying assets and
obligations for underlying liabilities. A joint arrangement in which the Group has direct rights to underlying assets
and obligations for underlying liabilities is classified as a joint operation.
Investments in associates and joint ventures are accounted for using the equity method. Interests in joint operations
are accounted for by recognising the Group’s assets (including its share of any assets held jointly), its liabilities
(including its share of any liabilities incurred jointly), its revenue from the sale of its share of the output arising
from the joint operation, its share of the revenue from the sale of the output by the joint operation and its expenses
(including its share of any expenses incurred jointly).
Any goodwill or fair value adjustment attributable to the Group’s share in the associate or joint venture is not
recognised separately and is included in the amount recognised as investment.
The carrying amount of the investment in associates and joint ventures is increased or decreased to recognise the
Group’s share of the profit or loss and other comprehensive income of the associate and joint venture, adjusted
where necessary to ensure consistency with the accounting policies of the Group.
Unrealised gains and losses on transactions between the Group and its associates and joint ventures are eliminated
to the extent of the Group’s interest in those entities. Where unrealised losses are eliminated, the underlying asset
is also tested for impairment.
Critical Accounting Estimates and Judgements
The directors evaluate estimates and judgements incorporated into the financial statements based on historical knowledge
and best available current information. Estimates assume a reasonable expectation of future events and are based on
current trends and economic data, obtained both externally and within the Group.
Key estimates – Impairment
The Group assesses impairment at each reporting date by evaluating conditions specific to the Group that may lead to
impairment of assets.
Share-based payment transactions
The Group measures the cost of equity-settled transactions with employees by reference to the fair value of the equity
instruments at the date at which they are granted. The fair value is determined by management review using the Black
Scholes, Monte Carlo, or an agreed fair value method. The relevant assumptions are detailed in Note 21. The accounting
estimates and assumptions relating to equity-settled share-based payments would have no impact on the carrying amounts
of assets and liabilities within the next annual reporting period but may impact expenses and equity.
Assessment of mine life of assets
The Assessment of mine life of assets has been based on Life of Mine Plan. In addition, condition of the assets is assessed
at least once per year and considered against the remaining mine life. Adjustments to mine lives are made when considered
necessary.
Estimation of useful lives of assets
The estimation of the useful lives of assets has been based on historical experience and manufacturers’ warranties (for
plant and equipment). In addition, the condition of the assets is assessed at least once per year and considered against the
remaining useful life. Adjustments to useful lives are made when considered necessary.
Exploration and evaluation of expenditure
Costs arising from exploration and evaluation activities are carried forward provided the rights to tenure of the area of the
interest are current and such costs are expected to be recouped through successful development, or by sale, or where
exploration and evaluation activities have not, at reporting date, reached a stage to allow a reasonable assessment
regarding the existence of economically recoverable reserves. Costs carried forward in respect of an area of interest that
is abandoned are written off in the year in which the decision to abandon is made. The carrying value of the capitalised
exploration and evaluation expenditure is assessed for impairment whenever facts and circumstances suggest that the
NOTES TO THE FINANCIAL STATEMENTS
KINGSTON RESOURCES LIMITED
for the year ended 30 June 2024
& its Controlled Entities
- 44 -
carrying amount of the asset may exceed its recoverable amount. Such capitalised exploration expenditure is carried at
the end of the reporting period at $49,592,453 (see Note 23).
The Group has applied AASB 6 Exploration for and Evaluation of Mineral Resources.
Consolidated Group
2024
2023
$
$
2.
OTHER INCOME
Other income
Interest income
38,674
3,238
Rental income
18,000
18,000
Total other income
56,674
21,238
Consolidated Group
2024
2023
$
$
3.
DEPRECIATION
Depreciation of:
- right of use asset
(219,495)
(225,107)
- building
(96,166)
(86,670)
- plant and equipment
(4,370,558)
(3,063,598)
Total depreciation and amortisation
(4,686,219)
(3,375,375)
4.
INCOME TAX
(a) Income tax recognised in profit and loss
The prima facie tax expense (benefit) on operating result is reconciled to the income tax provided in the statement of
profit or loss and other comprehensive income as follows:
Consolidated Group
2024
2023
$
$
Accounting profit/(loss) before income tax
(720,353)
9,807,227
Income tax benefit calculated at 25%
180,088
(2,451,807)
Non-deductible expenses
11,958
143,455
Utilisation of tax losses previously not recognised
-
2,308,352
Tax losses/temporary difference not brought into
account
192,046
-
Income tax expense (benefit)
-
-
The tax rate used in the above reconciliation is the corporate tax rate of 25% (FY23 25%) payable by Australian corporate
entities on taxable profits under Australian tax law.
NOTES TO THE FINANCIAL STATEMENTS
KINGSTON RESOURCES LIMITED
for the year ended 30 June 2024
& its Controlled Entities
- 45 -
(b) Analysis of deferred tax asset
No deferred tax assets have been recognised other than to offset deferred tax liabilities, as it is currently not probable that
future taxable profit will be available to realise the asset. The potential deferred tax asset on carry forward losses amounts
to $8,934,461 (2023: $6,296,780).
Tax Consolidation
Effective 1 July 2003, for the purposes of income taxation, the Company and its 100% wholly-owned subsidiaries formed
a tax consolidated group; the head entity of the tax consolidated group is Kingston Resources Limited.
5.
RIGHT OF USE ASSETS
The Group’s Right of use Assets include buildings (in the form of an office lease), plant and equipment and motor
vehicles.
Consolidated Group
30 June 2024
30 June 2023
$
$
a. Right of use assets
Leased Buildings
262,000
262,000
Accumulated Amortisation
(196,500)
(109,167)
Net Carrying Value
65,500
152,833
Leased Motor Vehicles
Opening Balance
582,401
361,505
Additions
93,728
262,978
Accumulated Amortisation
(381,453)
(326,654)
Net Carrying Value
294,676
297,829
Leased Equipment
Opening Balance
624,484
518,500
Reallocation to Plant & Equipment
(105,744)
63,901
Accumulated Amortisation
(175,421)
(98,057)
Net Carrying Value
343,319
484,344
Total Net Carrying Value
703,495
935,006
b. Lease liabilities
Current
256,781
360,334
Non-current
188,019
400,687
444,800
761,021
NOTES TO THE FINANCIAL STATEMENTS
KINGSTON RESOURCES LIMITED
for the year ended 30 June 2024
& its Controlled Entities
- 46 -
6.
INTERESTS OF KEY MANAGEMENT PERSONNEL
(a) Key management personnel compensation
Key management personnel (KMP) remuneration has been included in the Remuneration Report section of the Directors’
Report.
The totals of remuneration paid to KMP of the Group during the 2024 and 2023 reporting periods are as follows.
Consolidated Group
2024
2023
$
$
Short-term employee benefits
805,782
963,088
Post-employment benefits
69,008
60,743
Equity-settled share-based payments
253,314
108,126
Total
1,128,104
1,131,957
Consolidated Group
2024
2023
$
$
7.
AUDITOR REMUNERATION
Remuneration of the auditor of the Company for:
- auditing or reviewing the financial statements
76,000
60,714
- non-audit services
21,472
22,802
Total
97,472
83,516
Consolidated Group
2024
2023
$
$
8.
PROFIT/(LOSS) PER SHARE
(a)
Basic profit/(loss) per share (cents per share)
(0.14)
2.37
(b)
Diluted profit/(loss) per share (cents per share)
(0.14)
2.13
(c)
Weighted average number of ordinary shares on
510,164,957
413,256,806
issue used in the calculation of basic profit/(loss)
per share
(d)
Weighted average number of ordinary shares on
issue used in the calculation of diluted profit/(loss)
510,164,957
460,037,170
per share
(d)
Profit/(Loss) used in calculation
($720,353)
$9,807,227
Consolidated Group
2024
2023
$
$
9.
CASH AND CASH EQUIVALENTS
Cash at bank and in hand
8,357,776
18,206,767
Total
8,357,776
18,206,767
Cash at bank earns interest at floating rates based on daily deposit rates. The carrying amounts of cash and cash
equivalents represent fair value.
NOTES TO THE FINANCIAL STATEMENTS
KINGSTON RESOURCES LIMITED
for the year ended 30 June 2024
& its Controlled Entities
- 47 -
Consolidated Group
2024
2023
$
$
10.
TRADE AND OTHER RECEIVABLES
Current
Other receivables
515,345
1,315,211
Total current trade and other receivables
515,345
1,315,211
The Group has no significant concentration of credit risk with respect to any single counter party or group of counter
parties other than those receivables specifically provided for as mentioned within this note. The class of assets described
as Other Receivables is considered to be the main source of credit risk related to the Group. During the year, the Group
took up a provision equivalent to 100% of total GST receivable for Gallipoli Exploration (PNG) Ltd and WCB PNG
Exploration Ltd totalling $974,628. The provision increased the capitalised expenditure for Misima gold project by
$974,6289.
The Group applies the AASB 9 general approach to measuring expected credit losses, which permits the use of the lifetime
expected loss provision for all other receivables. Under the general approach a nil expected loss rate was applied to all
receivables as at 30 June 2024 and 30 June 2023.
Consolidated Group
2024
2023
$
$
11.
FINANCIAL ASSETS
Financial assets at fair value through profit and loss:
At fair value
Shares in listed entities
287,900
262,900
Options in listed entities
-
6,250
287,900
269,150
Financial assets at fair value through profit and loss consist of investments in ordinary shares and listed options.
(i)
Listed shares - The fair value of listed shares has been determined directly by reference to published price quotations
in an active market.
(ii) Listed options - The fair value of listed options has been determined directly by reference to published price
quotations in an active market.
12.
CONTROLLED ENTITIES
Name
Country of
Incorporation
Principal Activity
Beneficial Percentage
Interest Held By
Economic Entity
2024
%
2023
%
Mineral Hill Pty Ltd
Australia
Mineral exploration
100
100
WCB Pacific Pty Limited
Australia
Mineral exploration
100
100
WCB Australia Pty Limited
Australia
Mineral exploration
100
100
Slipstream WANT Pty Ltd*
Australia
Mineral Exploration
-
100
Universal Rare Earths Pty Ltd*
Australia
Mineral exploration
-
100
Fleurieu Mines Pty Ltd*
Australia
Mineral exploration
-
100
Centex Resources Ltd (formerly U Energy Pty Ltd)*
Australia
Mineral exploration
-
100
Gallipoli Exploration (PNG) Limited**
Papua New Guinea
Mineral exploration
100
100
WCB PNG Limited**
Papua New Guinea
Mineral exploration
-
100
WCB PNG Exploration Limited**
Papua New Guinea
Mineral exploration
-
100
*During the year, the dormant Australian subsidiaries of the group were deregistered.
**During the year, WCB PNG Limited, WCB PNG Exploration Limited and Gallipoli Exploration (PNG) Limited was amalgamated to
Gallipoli Exploration (PNG) Limited.
NOTES TO THE FINANCIAL STATEMENTS
KINGSTON RESOURCES LIMITED
for the year ended 30 June 2024
& its Controlled Entities
- 48 -
Consolidated Group
2024
2023
$
$
13.
PROPERTY, PLANT AND EQUIPMENT
Motor vehicles:
Opening balance
226,352
226,352
Closing Balance
226,352
226,352
Accumulated depreciation
Opening balance
176,381
135,900
Depreciation for the year
26,896
40,481
Closing balance
203,277
176,381
Net Book Value – Motor Vehicles
23,075
49,971
Buildings:
Opening balance
909,687
895,222
Additions
127,892
14,465
Transfer from Plant & Equipment
7,050
-
Closing Balance
1,044,629
909,687
Accumulated depreciation
Opening balance
419,685
333,015
Depreciation for the year
96,166
86,670
Closing balance
515,851
419,685
Net Book Value – Buildings
528,778
490,002
Plant & Equipment:
Opening balance
23,698,998
20,265,787
Additions
16,568,713
3,433,211
Net transfer to Mine Development
(445,012)
-
Transfer from Right of Use Assets
105,744
-
Transfer to Buildings
(7,050)
-
Closing Balance
39,921,393
23,698,998
Accumulated depreciation
Opening balance
6,982,862
3,919,264
Depreciation for the year
4,368,690
3,063,598
Closing balance
11,351,552
6,982,862
Net Book Value – Plant & Equipment
28,569,841
16,716,136
Net Book Value – Property, plant and Equipment
29,121,694
17,256,109
NOTES TO THE FINANCIAL STATEMENTS
KINGSTON RESOURCES LIMITED
for the year ended 30 June 2024
& its Controlled Entities
- 49 -
Consolidated Group
2024
2023
$
$
14.
OTHER NON CURRENT ASSETS
Environmental bonds
7,408,000
7,274,000
Other security deposits
147,209
125,044
Total
7,555,209
7,399,044
Consolidated Group
2024
2023
$
$
15.
TRADE AND OTHER PAYABLES
Trade payables – unsecured
5,986,431
5,234,297
Other payables and accruals
2,760,263
2,673,620
Total
8,746,694
7,907,917
Given the short-term nature of these amounts, their carrying value approximates their fair value.
NOTES TO THE FINANCIAL STATEMENTS
KINGSTON RESOURCES LIMITED
for the year ended 30 June 2024
& its Controlled Entities
- 50 -
Consolidated Group
30 June 2024
30 June 2023
Number of Fully
Paid Ordinary
Shares
$
Number of Fully
Paid Ordinary
Shares
$
16.
ISSUED CAPITAL
(a)
Movements in contributed equity for the year
Balance at the beginning of the year
415,653,656
121,170,385
412,769,439
121,051,877
Issue of shares during the financial year:
3 July 2023 tranche 1 of the Placement offer
52,941,176
4,169,707
26 July 2023 exercise of LTI Options
4,561,810
229,133
17 August 2023 tranche 2 Placement Offer
11,764,705
930,957
17 August 2023 vesting of Performance Rights
742,826
4,765
17 August 2023 under employment contract
206,764
22,558
17 August 2023 exercise of FY22 service fee options
326,233
52,197
17 August 2023 Shareholder participation under SPP offer
10,247,017
810,864
18 August 2023 Underwritten component of SPP offer
1,517,647
120,093
8 April 2024 Share Placement and accelerated component of ANREO
135,732,433
8,822,608
15 May 2024 Retail component of ANREO
71,751,815
4,663,878
15 May 2024 exercise of FY23 service fee options
699,313
58,742
15 May 2024 exercise of FY24 service fee options
874,576
73,464
Shares issued during the previous financial year:
5 Aug 2022
627,186
7,641
5 Dec 2022
2,257,031
113,367
Less capital raising costs
(1,272,447)
(2,500)
Total contributed equity
707,019,971
139,856,904
415,653,656
121,170,385
During the period the Company issued share capital amounting to 2,849,712 fully paid ordinary shares of no par value. At shareholders’ meetings each fully paid ordinary share
is entitled to one vote when a poll is called.
On 27 June 2023, the Company announced its intention to undertake a two Tranche Share Placement offer with one attaching unlisted option for every two Placement Shares
raising a total of $5,500,000. On 30 June 2023, advanced placement monies totalling $4,500,000 was received under Tranche 1 of the Placement offer. On 3 July 2023, 52,941,176
Tranche 1 Placement shares and on 17 August 2023, 26,245,576 unlisted attaching options were issued for cash totalling to $4,500,000. Fair value of unlisted options amounting
NOTES TO THE FINANCIAL STATEMENTS
KINGSTON RESOURCES LIMITED
for the year ended 30 June 2024
& its Controlled Entities
- 51 -
to $330,293 was recognised under share-based payment reserve. The unlisted options are each exercisable at $0.14 each to acquire one fully paid ordinary share exercisable at
any time up to 31 July 2025.
On 26 July 2023, the Company issued 4,561,810 shares to eligible employees upon exercise of 4,561,810 LTI options for cash totalling to $45,618. The fair value of options
issued was $183,515.
On 17 August 2023, the Company issued 11,764,705 shares and 5,882,352 unlisted attaching options totalling to $1,000,000 under Tranche 2 of the Share Placement Offer. No
monies were raised from the Tranche 2 placement, however the final milestone payment of USD$3.5 million due to Quintana Resources Holdings LP upon producing 30,000
Oz’s of gold since acquisition of Mineral Hill Pty Ltd was reduced by USD$645,100 (A$1million). Fair value of unlisted options amounting to $69,043 was recognised under
share-based payment reserve. The unlisted options are each exercisable at $0.14 each to acquire one fully paid ordinary share exercisable at any time up to 31 July 2025.
On 17 August 2023, the Company issued 742,826 shares to eligible employees upon short term performance rights being vested for nil cash consideration. The fair value of the
performance rights issued was $4,765.
On 17 August 2023, the Company issued 326,233 shares to its non-executive directors upon exercise of FY22 service fee options for nil cash consideration. The fair value of
the options issued was $22,558.
On 17 August 2023, Kingston issued staff 206,764 shares for nil consideration to an employee as part of their employment contract. The fair value of the shares amounted to
$22,558.
On 17 August 2023, the Company issued 10,247,017 shares and 5,123,459 unlisted attaching options under the SPP offer for cash totalling $871,000. Fair value of unlisted
options amounting to $60,136 was recognised under share-based payment reserve. The unlisted options are each exercisable at $0.14 each to acquire one fully paid ordinary
share exercisable at any time up to 31 July 2025.
On 18 August 2023, the SPP was completed upon issuing 1,517,647 shares and 758,823 unlisted attaching options to the sub underwriter Delphi Unternehmensberatung
Akteingesellschaft, an existing major shareholder and sophisticated investor for cash totalling to $129,000. Fair value of unlisted options amounting to $8,907 was recognised
under share-based payment reserve. The unlisted options are each exercisable at $0.14 each to acquire one fully paid ordinary share exercisable at any time up to 31 July 2025.
On 2 April 2024, the Company announced its intention to undertake a Share Placement Offer and an Accelerated Non-Renounceable Rights Issue Offer (ANREO) raising a total
of $13.48 Million. On 8 April 2024,the Company issued 124,490,461 shares under the Placement Offer and 11,241,969 shares under the accelerated component of the ANREO
for cash totalling to $8,822,608.
On 15 May 2024, the Company issued 71,751,815 shares under the retail component of the ANREO for cash totalling to $4,663,867.
On 15 May 2024, the Company issued 699,313 shares to its non-executive directors upon exercise of FY23 service fee options for nil cash consideration. The fair value of the
options issued was $58,742.
On 15 May 2024, the Company issued 874,576 shares to its non-executive directors upon exercise of FY24 service fee options for nil cash consideration. The fair value of the
options issued was $73,464.
During the financial year, 6,461,932 fully paid ordinary shares were issued as a result of the exercise of options, and 742,826 shares were issued as a result of Performance
Rights vesting.
Since the end of the financial year end, no ordinary shares have been issued as a result of the exercise of options.
For more details on issues subsequent to the end of financial year, refer Subsequent Events note.
NOTES TO THE FINANCIAL STATEMENTS
KINGSTON RESOURCES LIMITED
for the year ended 30 June 2024
& its Controlled Entities
- 52 -
(b) Options
(i)
For information relating to the Company’s employee and consultant option scheme, including details of options
issued, exercised and lapsed during the financial year and the options outstanding at year end, refer to Note 21
Share-based Payments.
(ii)
For information relating to share options issued to key management personnel during the financial year, refer
to the Directors’ Report.
(c) Capital Management
Management controls the capital of the Group in order to maintain a good debt to equity ratio, provide the
shareholders with adequate returns and ensure that the Group can fund its operations and continue as a going
concern.
The Group’s debt and equity capital includes ordinary share capital and financial liabilities, supported by
financial assets. There are no externally imposed capital requirements.
Management effectively manages the Group’s capital by assessing its financial risks and adjusting its capital
structure in response to changes in these risks and in the market. These responses include the management of
debts levels, distributions to shareholders and share issues.
There have been no changes in the strategy adopted by management to control the capital of the Group since
the prior year.
17.
RESERVES
(a)
Share-based Payment Reserve
The share-based payment reserve records items recognised as expenses on valuation of unlisted employee and
consultant incentive scheme options and performance rights. Refer to Note 21 Share-based Payments for further
details.
18.
COMMITMENTS AND CONTINGENCIES
The Group has certain obligations to perform minimum exploration work and to expend minimum amounts of
money on such work on mining tenements. These obligations may be varied from time to time subject to approval
and are expected to be fulfilled in the normal course of the operations of the Group. These commitments have not
been provided for in the financial report. Due to the nature of the Group’s operations in exploring and evaluating
areas of interest, it is difficult to accurately forecast the nature and amount of future expenditure beyond the next
year. Expenditure may be reduced by seeking exemption from individual commitments, by relinquishing tenure
or by new joint venture arrangements. Expenditure may be increased when new tenements are granted or joint
venture agreements amended. The minimum expenditure commitment on currently held tenements is:
Consolidated Group
2024
2023
Exploration commitment
$
$
Not later than one year
1,390,207
1,465,151
Later than one year and less than five years
3,161,458
3,161,458
Rehabilitation Security Bond commitment
In the Prior year, the Company held cash backed Rehabilitation Security Bond for Mineral Hill mining leases
totalling to $7,247,000.
During the year, the Rehabilitation Security Bond commitment was increased by $161,000. On 16 May 2024, the
Company fulfilled its commitment and increased its cash backed Rehabilitation Security Bond by $161,000, to a
total of $7,408,000.
NOTES TO THE FINANCIAL STATEMENTS
KINGSTON RESOURCES LIMITED
for the year ended 30 June 2024
& its Controlled Entities
- 53 -
The Group has finance leases between two and five years for motor vehicles and equipment purchased for the
Mineral Hill mine. The future minimum lease payments are as follows:
Consolidated Group
2024
2023
Finance lease commitment
$
$
Not later than one year
177,695
268,317
Later than one year and less than five years
188,019
327,276
The Group is a party to rental leases for its office premises. The future minimum lease payments are as follows:
Consolidated Group
2024
2023
Operating lease commitment
$
$
Not later than one year
79,086
86,342
Later than one year and less than five years
-
79,086
19.
SEGMENT REPORTING
For the year ended 30 June 2024, the Group has two segments, being mining and exploration of minerals in
Australia and Papua New Guinea.
Segment results, assets and liabilities include items directly attributable to a segment as well as those that can
be allocated on a reasonable basis.
Segment capital expenditure is the total cost incurred during the period to acquire segment assets that are
expected to be used for more than one period in that geographic region.
2024
Australia
PNG
Total
External revenue
39,277,245
-
39,277,245
Other revenue
18,000
-
18,000
Interest income
38,570
104
38,674
Total revenue
39,333,815
104
39,333,919
EBITDA
7,454,019
(14,071)
7,439,948
Depreciation and amortisation
(6,714,614)
-
(6,714,614)
Total comprehensive (loss)
(733,084)
(16,832)
(749,916)
Reportable segment asset
77,300,631
44,316,768
121,617,399
Reportable segment liability
(30,710,435)
(125,440)
(30,835,875)
Net assets
46,590,196
44,191,328
90,781,524
2023
Australia
PNG
Total
External revenue
44,753,992
-
44,753,992
Other revenue
18,000
-
18,000
Interest income
3,238
-
3,238
Total revenue
44,775,230
-
44,775,230
EBITDA
15,052,690
(20,543)
15,032,147
Depreciation and amortisation
(4,451,071)
-
(4,451,071)
Total comprehensive income
9,816,707
(29,374)
9,787,333
Reportable segment asset
69,328,702
42,092,070
111,420,772
Reportable segment liability
(34,743,120)
(222,752)
(34,965,872)
Net assets
34,585,582
41,869,318
76,454,900
NOTES TO THE FINANCIAL STATEMENTS
KINGSTON RESOURCES LIMITED
for the year ended 30 June 2024
& its Controlled Entities
- 54 -
20.
CASH FLOW INFORMATION
(a) Reconciliation to Statement of Cash Flows
For the purposes of the Statement of Cash Flows, cash and cash equivalents are as reported above.
Consolidated Group
2024
2023
$
$
Reconciliation of Loss from Ordinary Activities to
Net Cash Flows from Operating Activities
Profit/(Loss) for the year
(720,353)
9,807,225
Depreciation and amortisation
6,714,614
4,451,071
Share-based payments
507,482
314,996
Revaluation of assets at FVTPL
(18,750)
293,750
Interest Paid
1,049,539
647,500
Unrealised fx (gain)/losses
333,669
13,980
Changes in assets and liabilities
Decrease/(increase) in trade and other receivables
424,352
(47,054)
Decrease/(increase) in prepayments
(122,819)
(176,891)
Decrease/(increase) in inventory
172,369
(55,306)
Decrease/(increase) in other non-current assets
(2,026,017)
(1,061,094)
(Decrease) in trade payables
213,837
1,124,059
(Decrease)/increase in provisions
168,059
33,319
(Decrease)/increase in other payables and accruals
(816,877)
148,683
Net cash flows from operating activities
5,879,105
15,494,238
21.
SHARE-BASED PAYMENTS
(i)
Share options and performance rights are granted to employees and directors of the Company, or any Associated
Body Corporate of the Company. The following employee share-based payment arrangements existed at 30 June
2024.
Share options:
Date of grant
Share-based payment
Number
Outstanding
Value
Share Price
on Issue
Exercise
Price
Expiry
5 Nov 2021
LTI Options1
1,377,981
67,640
0.205
0.00
31 August 2024
14 Dec 2021
LTI Options1
815,952
40,052
0.165
0.00
31 August 2024
17 Jun 2022
LTI Options1
149,082
7,318
0.094
0.00
31 August 2024
6 Dec 2022
LTI Option1
5,171,621
84,407
0.105
0.00
31 August 2028
17 Aug 2023
LTI Options1
37,048
605
0.016
0.00
31 August 2028
28 Nov 2023
LTI Options1
6,700,843
120,878
0.082
0.00
31 August 2029
1 LTI Performance Options vest subject to share price hurdles
On 26 July 2023, the Company issued 4,561,810 shares to eligible employees upon exercise of 4,561,810 LTI options
for cash totalling to $45,618. The fair value of options issued was $183,515.
On 17 August 2023, the Company issued 742,826 shares to eligible employees upon short term performance rights
being vested for nil cash consideration. The fair value of the performance rights issued was $4,765.
NOTES TO THE FINANCIAL STATEMENTS
KINGSTON RESOURCES LIMITED
for the year ended 30 June 2024
& its Controlled Entities
- 55 -
On 17 August 2023, the Company issued 326,233 shares to its non-executive directors upon exercise of FY22 service
fee options for nil cash consideration. The fair value of the options issued was $22,558.
On 28 November 2023, the Company issued 699,313 FY23 Service Fee Options to its non-executive directors. On 15
May 2024, the Company issued 699,313 shares to its non-executive directors upon exercise of FY23 Service Fee
options for nil cash consideration. The fair value of the options issued was $58,742.
On 28 November 2023, the Company issued 874,576 FY24 Service Fee Options to its non-executive directors. On 15
May 2024, the Company issued 874,576 shares to its non-executive directors upon exercise of FY24 service fee
options for nil cash consideration. The fair value of the options issued was $73,464.
During the year, $203,420 was recognised as fair value of MH project Goal Performance Options.
During the financial year, 1,900,122 fully paid ordinary shares were issued as a result of the exercise of options
(2023:2,257,031), and 742,826 shares were issued as a result of Performance Rights vesting (2023:627,186).
Performance Options:
Date of grant
Share-based payment
Number granted
Value
Expiry date
28 Nov 2023
STI Performance Options1
3,145,092
39,887
31 August 2027
1 STI Performance Options issued on 28 November 2023 will vest as follows:
(a) Up to 50% of STI Performance Options will automatically vest if the Company’s June 2023 VWAP is
equivalent to the 50th percentile relative to a peer group of companies.
(b) Up to 100% of STI Performance Options will automatically vest if the Company’s June 2023 VWAP is
equivalent to the 80th percentile relative to a peer group of companies.
(c) 0% will vest if the Company’s June 2023 VWAP is below the 50th percentile relative to a peer group of
companies.
Upon vesting, STI Options covert to non-transferable ZEPO. All vested STI ZEPOs have an expiry date of 3 years
from vesting.
All STI Options that have not vested by 31 August 2024 will automatically lapse and be forfeited.
The principal assumptions used in estimating the value of the STI and LTI options include volatility of 55%
determined with reference to the Company’s historic volatility and the volatility of peer group companies.
The number and weighted average exercise prices of share options granted to employees and directors is as follows:
2024
2023
Number of
Options
Weighted Average
Exercise Price
$
Number of
Options
Weighted Average
Exercise Price
$
Outstanding at beginning of period
14,994,519
0.00
13,438,838
0.05
Exercised during the period
(6,461,932)
0.00
(2,257,031)
0.01
Expired during the period
(2,591,840)
0.01
(1,358,909)
0.33
Issued during the period
11,456,872
0.00
5,171,621
0.00
Outstanding at year-end
17,397,619
0.00
14,994,519
0.00
Exercisable at year-end
-
-
4,888,043
0.00
(ii)
Other share-based payments granted to third parties.
Share based payments to external parties:
There was nil share-based payment to external parties during the year.
NOTES TO THE FINANCIAL STATEMENTS
KINGSTON RESOURCES LIMITED
for the year ended 30 June 2024
& its Controlled Entities
- 56 -
Share Based Payment Reserve
Movements in Share Based Payment Reserve for the year
Consolidated Group
2024
2023
$
$
Share Based Payments Reserve
Opening reserve at 1 July
2,043,126
609,952
Options/Rights exercised during the year
(372,684)
(98,438)
Options/Rights lapsed during the year
(172,657)
(118,256)
Options expensed during the year
485,262
314,996
SPP options issued during the year
138,086
330,293
Fair value of warrants
-
1,004,579
Closing reserve at 30 June
2,121,133
2,043,126
22.
RELATED PARTY TRANSACTIONS
(a)
Key Management Personnel
Key management personnel compensation has been included in the Remuneration Report section of the Directors’
Report and Note 6 Interests of Key Management Personnel.
(b)
Directors’ Interests
As at 30 June 2024 the relevant interests of each of the Directors, held either directly or indirectly through their
associates, in the securities of Kingston was as follows:
Director
Fully Paid Ordinary
Shares (KSN)
Unlisted Options Performance Options
Mick Wilkes 1
3,945,679 176,470
-
Andrew Corbett 2,5
7,986,181 4,801,349 922,473
Anthony Wehby 3
3,044,223 352,941
-
Stuart Rechner 4
1,344,281 176,470
-
1 Mick Wilkes holds a relevant interest in the specified number of Shares and Options as a result of being a director of
Eligius Holdings Pty Limited as trustee of Eligius Holdings Pty Limited ATF, which is the registered holder of those
Shares and Options.
2 Andrew Corbett holds a relevant interest in the specified number of Shares and Options as a result of being a director
of Milamar Group Pty Ltd as trustee of Milamar Family Trust, which is the registered holder of those Shares and
3 Anthony Wehby holds a relevant interest in Options as he is a related party to Mrs Rosemary Wehby, who is the
registered holder of the options.
4 Stuart Rechner holds a relevant interest in the specified number of Shares and Options as a result of being a director of
Osmium Holdings Pty Limited as trustee of Ferndale Superannuation Fund, which is the registered holder of those
Shares and Options
5 As approved by Shareholders at the general meeting on 14 August 2023, Andrew Corbett has a right to acquire MH
Project Goal Performance Options valued at $300,000, subject to satisfaction of various vesting conditions. The earliest
vesting date is 30 June 2025.The number of securities to be issued in respect of rights will be calculated on the basis of
the 20-day KSN VWAP immediately prior to the vesting condition being met. Any unvested securities will automatically
lapse on 31 July 2025.
NOTES TO THE FINANCIAL STATEMENTS
KINGSTON RESOURCES LIMITED
for the year ended 30 June 2024
& its Controlled Entities
- 57 -
23.
MINE/RESOURCE DEVELOPMENT AND EXPLORATION
Consolidated Group
Mine/Resource
development
expenditure
Capitalised
exploration
expenditure
Total
$
$
$
At 1 July 2023
Cost
17,807,938
46,079,669
63,887,607
Accumulated amortisation
(1,156,954)
-
(1,156,954)
Net Carrying Amount
16,650,984
46,079,669
62,730,653
Year ended 30 June 2024
Carrying amount at the beginning of the period
16,650,984
46,079,669
62,730,653
Additions
7,797,522
3,666,443
11,463,965
Net transfer from Plant & Equipment
445,012
-
445,012
Amortisation
(2,028,395)
-
(2,028,395)
Foreign exchange differences
-
13,396
13,396
Carrying amount at the end of the year
22,865,123
49,759,508
72,624,631
At 30 June 2024
Cost
26,050,472
49,759,508
75,809,980
Accumulated amortisation
(3,185,349)
-
(3,185,349)
Net Carrying Amount
22,865,123
49,759,508
72,624,631
An impairment assessment was undertaken of the Group’s exploration assets held at the end of FY24. Nothing has
come to the Company’s attention to indicate that amounts recorded as Capitalised Exploration Expenditure as at
30 June 2024 are not reasonable, require impairment, or do not meet the requirements of AASB 6.
Of the total $49,759,508 capitalised exploration expenditure, $44,277,784 is attributable to the Misima Gold
Project, 5,481,724 is attributable to Mineral Hill tenements.
24.
FINANCIAL INSTRUMENTS
The Group’s principal financial instruments comprise receivables, payables, FVTPL financial assets, cash and
short-term deposits and a commercial loan.
The main risks arising from the Group’s financial instruments are interest rate risk, credit risk and liquidity risk.
The Company uses different methods to measure and manage different types of risks to which it is exposed. These
included monitoring levels of exposure to interest rate and market forecasts for interest rate. Ageing analyses and
monitoring of specific credit allowances are undertaken to manage credit risk. Liquidity risk is monitored through
the development of future rolling cash flow forecasts.
The Board reviews and agrees policies for managing each of these risks which are summarised below.
(a)
Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in a financial
loss to the Group.
Credit risk arises from cash and cash equivalents, trade and other receivables and FVTPL financial assets. The
Group’s exposure to credit risk arises from potential default of the counter party, with a maximum exposure equal
to the carrying amount net of any provisions for these assets as disclosed in the statement of financial position and
notes to the financial statements.
The Group has adopted a policy of only dealing with creditworthy counter parties as a means of mitigating the risk
of financial loss from defaults. It is the Group’s policy that all customers who wish to trade on credit terms are
subject to credit evaluations including an assessment of their independent credit rating, financial position, past
NOTES TO THE FINANCIAL STATEMENTS
KINGSTON RESOURCES LIMITED
for the year ended 30 June 2024
& its Controlled Entities
- 58 -
experience and industry reputation. Risk limits are set for each individual customer in accordance with parameters
set by the Board. These risk limits are regulatory monitored. The Group does not require collateral in respect of
financial assets.
In addition, receivable balances are monitored on an ongoing basis with the result that the Group’s exposure to
bad debts is not significant. At the reporting date there were no significant concentrations of credit risk. Refer to
Note 10 for further information on impairment of financial assets that are past due.
(b)
Liquidity risk
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. The Group manages the liquidity risk by maintaining adequate cash
reserves, and by continuously monitoring forecast and actual cash flows while matching the maturity profiles of
financial assets and liabilities. There are no material financial assets or financial liabilities that are subject to
liquidity risk as at 30 June 2024 or 30 June 2023.
(c) Interest rate risk
The Group’s current exposure to the risk of changes in market interest rates relate primarily to cash assets rates.
The Group does not account for fixed rate financial assets and liabilities at fair value through profit or loss.
The following table illustrates sensitivities to the Group’s exposures to changes in interest rates. The table indicates
the impact on how profit / (loss) and equity values reported at reporting date would have been affected by changes
in the relevant risk variable that management considers to be reasonably possible. The Group’s main interest rate
risk arises from cash and cash equivalents with variable interest rates.
Consolidated Group
2024
2023
$
$
Financial assets
Cash and cash equivalents
8,357,776
18,206,767
8,357,776
18,206,767
Impact on post tax profit / (loss) and equity
+ 2% in interest rate
167,156
364,135
- 2% in interest rate
(167,156)
(364,135)
(d) Foreign currency risk
The Group is not exposed to significant financial risks from movements in foreign exchange rates. The Group does
not participate in any type of hedging transactions or derivatives. Therefore, no sensitivity analysis is required.
(e)
Price risk
The Group’s exposure to commodity and equity securities price risk is minimal. Equity securities price risk arises
from investments in equity securities.
The price risk for both listed and unlisted securities is immaterial in terms of a possible impact on profit and loss
or total equity and as such a sensitivity analysis has not been completed.
(f) Fair value
For the financial assets and liabilities disclosed in this note, the fair value approximates their carrying value.
The aggregate fair values and carrying amounts of financial assets and financial liabilities are disclosed in the
statement of financial position and in the notes to and forming part of the financial statements.
NOTES TO THE FINANCIAL STATEMENTS
KINGSTON RESOURCES LIMITED
for the year ended 30 June 2024
& its Controlled Entities
- 59 -
2024
2023
Footnote Net Carrying
Value
$
Fair
Value
$
Net Carrying
Value
$
Fair
Value
$
Consolidated Group
Financial assets
Cash and cash equivalents
(i)
8,357,776
8,357,776
18,206,767
18,206,767
Trade and other receivables
(i)
515,345
515,345
1,315,211
1,315,211
Financial assets at fair value
(ii)
287,900
287,900
269,150
269,150
Total financial assets
9,161,021
9,161,021
19,791,128
19,791,128
Financial liabilities
Trade and other payables
(i)
8,746,694
8,746,694
7,907,918
7,907,918
Lease liabilities
444,800
444,800
761,021
761,021
Deferred Payables
4,158,967
4,158,967
9,579,789
9,579,789
Interest bearing liabilities
9,277,975
9,277,975
8,864,972
8,864,972
Total financial liabilities
22,628,436
22,628,436
27,113,700
27,113,700
The fair values disclosed in the above table have been determined based on the following methodologies:
(i) Cash and cash equivalents, trade and other receivables and trade and other payables are short-term
instruments in nature whose carrying value is equivalent to fair value. Trade and other payables exclude
amounts provided for annual leave, which is not considered a financial instrument.
(ii) For financial assets at fair value through profit and loss, closing quoted bid prices at the end of the reporting
period are used. These listed investments are included within level 1 of the hierarchy of financial assets.
(iii) Lease liabilities and Interest bearing liabilities are carried at amortised cost.
NOTES TO THE FINANCIAL STATEMENTS
KINGSTON RESOURCES LIMITED
for the year ended 30 June 2024
& its Controlled Entities
- 60 -
25.
PARENT COMPANY INFORMATION
Parent Entity
2024
2023
$
$
Assets
Current assets
7,648,728
11,429,755
Non-current assets
80,803,691
71,246,534
Total assets
88,452,419
82,676,289
Liabilities
Current liabilities
4,930,760
10,519,933
Non-current liabilities
9,104,811
8,930,808
Total liabilities
14,035,571
19,450,741
Equity
Issued capital
139,856,904
121,170,385
Accumulated losses
(67,561,189)
(63,855,415)
Share-based payments reserve
2,121,133
2,043,126
Total equity
74,416,848
59,358,096
Financial performance
Loss for the year
(3,878,808)
(3,127,861)
Other comprehensive income / (loss)
-
-
Total comprehensive loss
(3,878,808)
(3,127,861)
Contractual commitments
Refer to note 18 for contractual and exploration commitments for the parent entity during the
financial year.
26.
BORROWINGS
Consolidated Group
2024
2023
$
$
Interest bearing loans
9,104,811
8,822,176
On 7 July 2022, the Company secured a two tranche $10m debt facility with PURE Asset Management. Under
Tranche 1, $5 million was drawn under a 4-year secured loan facility at an interest rate of 9.90% per annum with
25,000,000 detached warrant shares at an exercise price of $0.20. An establishment fee of $150,000 was
recognised as a reduction in proceeds.
On 29 June 2023, the Company withdrew $5million under Tranche 2 of the facility, under a 4-year secured loan
facility at an interest rate of 9.90% per annum with 35,714,286 detached warrant shares at an exercise price of
$0.14. An establishment fee of $150,000 was recognised as a reduction in proceeds.
Conversion by the lender
Tranche 1 Warrants - The lender may elect at any time up to 7 July 2027, to convert any number greater than or
equal to 5,000,000 warrant shares per conversion, at a rate of $0.20 share for every warrant share converted (this
conversion rate may be adjusted in the event of significant future capital raisings). The noteholder is not entitled
to any additional payments on account of this conversion
NOTES TO THE FINANCIAL STATEMENTS
KINGSTON RESOURCES LIMITED
for the year ended 30 June 2024
& its Controlled Entities
- 61 -
Tranche 2 Warrants - The lender may elect at any time up to 29 June 2028, to convert any number greater than or
equal to 5,000,000 warrant shares per conversion, at a rate of $0.14 share for every warrant share converted (this
conversion rate may be adjusted in the event of significant future capital raisings). The noteholder is not entitled
to any additional payments on account of this conversion.
During the year, the Company issued more than 15% of the numbers of shares on issue under a Share Placement
Offer and an ANREO offer within 12 months of last equity raising in August 2023. This event has triggered
repricing of Tranche 1 Warrants from $0.20 and Tranche 2 warrants from $0.14 per share to $0.083 per share
under the anti-dilution price adjustment clause. The Company will seek shareholder approval to reprice the
Tranche 1 and Tranche 2 Warrants in the next shareholder meeting.
Failure to Redeem
If the noteholder does not convert all their warrant shares during the exercise period, then the balance of the debt
facility under Tranche 1 facility will be repaid on 7 July 2026 and the balance of the debt facility under the
Tranche 2 facility will be repaid on 29 June 2027.
Movement in interest bearing loan
Consolidated Group
2024
2023
$
$
Carrying value at the beginning of the period
8,822,176
-
Issue of convertible notes – face value
-
10,000,000
Less: 3% Establishment fee
-
(300,000)
Less: Fair value of equity component – share warrants
-
(1,004,579)
Add: Unwinding of discount
282,635
126,755
Carrying value as at end of the period
9,104,811
8,822,176
27. DEFERRED PAYABLES
Consolidated Group
2024
2023
$
$
Opening balance
9,579,789
12,557,882
less:
- Milestone payments
(4,593,208)
(2,240,813)
- T2 share placement offer
(1,000,000)
-
- Royalty payments to Quintana
(703,140)
(896,782)
- Restructuring fee (final milestone payment)
(150,966)
-
- Foreign exchange loss
1,026,492
159,502
Closing balance
4,158,967
9,579,789
On 17 January 2022, the Group completed the acquisition of Mineral Hill Pty Ltd. Mineral Hill Pty Ltd assets
include operating Mineral Hill Mine. Upon Acquisition, the Group recognised deferred payment totalling to
$12.8 million, comprising of USD$8 million (AUD$11.1 million) for milestone payments and $1.7 million for
royalty payment. As at the end of the year, the Group has paid milestone payments totalling to USD$4.5 million
($6.8 million) and royalty payments totalling to USD$1.2 million (AUD$1.8 million). The Final Milestone
Payment of USD$3.5 million was reduced by USD$645,100 (AUD$1 million) from Quintana Holdings LLP
participation in Tranche 2 Placement offer which was completed on 17 August 2023. The Group is currently in
discussions with Quintana Holdings LLP for restructuring the remaining Milestone payment of USD$2.85
million AUD$4.3 million). On 28 June 2024, the Group paid a fee totalling to USD$100,000 (AUD$150,966) to
restructure the outstanding milestone payment.
NOTES TO THE FINANCIAL STATEMENTS
KINGSTON RESOURCES LIMITED
for the year ended 30 June 2024
& its Controlled Entities
- 62 -
SUBSEQUENT EVENTS
On 29 August 2024, 1,134,182 STI performance Options vested and were converted to non-transferable ZEPOs. All the
vested STI ZEPOs have an expiry date of 3 years from vesting. 2,010,910 unvested STI performance options expired.
On 23 August 2024, the Company secured a $5 million debt facility in addition to its existing $10 million debt, under a
revised facility agreement with PURE Asset Management to fund the Company’s key growth initiatives at Mineral Hill.
The additional debt facility was drawn immediately and is repayable on 22 February 2027.
Other than the above, there has been no other matter or circumstance which has arisen since 30 June 2024 that has
significantly affected or may significantly affect:
d)
Kingston Resources Limited’s operations in future financial years; or
e)
the results of those operations in future financial years; or
f)
Kingston Resources Limited’s state of affairs in future financial years.
Consolidated Entity Disclosure Statement
This Consolidated Entity Disclosure Statement (CEDS) has been prepared in accordance with the Corporations Act
2001. It includes certain information for each entity that was part of the Consolidated Entity at the end of the financial
year.
Name
Type of entity
Country of
Incorporation
Ownership
interest %
Country of tax
residence
Mineral Hill Pty Ltd
Body Corporate
Australia
100%
Australia
WCB Pacific Pty Limited
Body Corporate
Australia
100%
Australia
WCB Australia Pty Limited
Body Corporate
Australia
100%
Australia
Gallipoli Exploration (PNG) Limited
Body Corporate
Papua New Guinea
100%
Papua New Guinea
KINGSTON RESOURCES LIMITED
2024 ANNUAL REPORT
& its Controlled Entities
- 63 -
Directors’ Declaration
The Directors of the Company declare that:
1. In the opinion of the Directors of the Company:
(a)
the financial statements and notes set out on page 30 to 62, and the Remuneration disclosures that are
contained in page 20 to 25 of the Remuneration Report in the Directors’ Report, are in accordance with
the Corporations Act 2001, including:
(i)
giving true and fair view of the Group’s financial position as at 30 June 2024 and of its
performance, for the financial year ended on that date;
(ii) complying with Australian Accounting Standards (including the Australian Accounting
Interpretations) and the Corporations Regulations 2001; and
(iii) complying with International Financial Reporting Standards as disclosed in Note 1.
(iv) the Consolidated Entity Disclosure Statement included in the financial statements is true and
correct.
(b) the remuneration disclosures that are contained in page 20 to 25 of the Remuneration Report in the
Directors’ Report comply with Australian Accounting Standard AASB 124 Related Party Disclosures.
(c) the directors have been given the declaration required by s295A of the Corporations Act 2001 by the
persons undertaking the roles of Managing Director and Chief Financial Officer.
2. There are reasonable grounds to believe that the Company will be able to pay its debts as and when they
become due and payable.
Signed in accordance with a resolution of the Board of Directors.
MICK WILKES
Non-Executive Chairman
Sydney, New South Wales
13 September 2024
KINGSTON RESOURCES LIMITED
ABN 44 009 148 529
AND CONTROLLED ENTITIES
INDEPENDENT AUDITOR’S REPORT TO THE OWNERS OF
KINGSTON RESOURCES LIMITED
Report on the Financial Report
Opinion
We have audited the financial report of Kingston Resources Limited (the Company) and its controlled entities
(the Group), which comprises the consolidated statement of financial position as at 30 June 2024, the
consolidated statement of profit or loss, the consolidated statement of 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 consolidated financial statements, including a statement of material accounting policies, consolidated
entity disclosure statement and the directors’ declaration.
In our opinion the accompanying financial report of Kingston Resources Limited and Controlled Entities 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 2024 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. Those Standards require that we
comply with relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain
reasonable assurance about whether the financial report is free from material misstatement. Our responsibilities
under those Standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Report
section of our report. We are independent of the Group in accordance with the auditor independence
requirements of the Corporations Act 2001 and the ethical requirements of the Accounting Professional and
Ethical Standards Board’s APES 110: Code of Ethics for Professional Accountants (the Code) that are relevant
to our audit of the financial report in Australia. We have also fulfilled our other ethical responsibilities in
accordance with the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has been given to
the directors of the Company, would be in the same terms if given to the directors as at the time of this auditor’s
report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
Emphasis of Matter – Material Uncertainty Related to Going Concern
We draw attention to Note 1(s) in the financial report, which describes the principal conditions that raise doubt
about the Group’s ability to continue as a going concern. As stated in Note 1(s), these events or conditions
indicate that a material uncertainty exists that may cast significant doubt on the Group’s ability to continue as
a going concern. Our opinion is not modified in respect of this matter.
KINGSTON RESOURCES LIMITED
ABN 44 009 148 529
AND CONTROLLED ENTITIES
INDEPENDENT AUDITOR’S REPORT TO THE OWNERS OF
KINGSTON RESOURCES LIMITED
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 for the year ended 30 June 2024. These matters were addressed in the context of our
audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide a separate
opinion on these matters.
Key Audit Matter
How Our Audit Addressed the Key Audit Matter
Capitalised Exploration and Mine Development Expenditure
Refer to Note 23 “Mine/Resource Development and Exploration”
At 30 June 2024, the Group’s assets included
capitalised exploration costs of $49,759,508, and
mine development expenditures of $22,865,123.
The Group’s accounting policy in respect of mine
development and exploration expenditure is
outlined in Note 1(o) and Note 1(p).
Due to the net assets of the Group exceeding its
market
capitalisation,
the
Group
identified
indicators of impairment in its PNG and Mineral Hill
Cash Generating Unit (CGU) during the year.
As a result, the Group considered PNG and
Mineral Hill CGU for impairment. As a result of the
Group’s
assessment,
no
impairment
was
recognised during the year.
This is a key audit matter because the carrying
value of the assets are material to the financial
statements and significant judgement is applied in
determining whether an indicator of impairment
exists in relation to capitalised exploration costs,
and
mine
development
expenditures
in
accordance with Australian Accounting Standard
AASB 6 “Exploration for and Evaluation of Mineral
Resources” and AASB 136 “Impairment of
Assets”.
Our audit procedures included but were not limited to:
•
Confirming the existence and tenure of the exploration
assets in which the Group has a contracted interest by
obtaining confirmation of title from the relevant
authorities.
•
Tested a sample of additions of capitalised exploration
costs,
and
mine
development
expenditures
to
supporting documentation.
•
In assessing whether an indicator of impairment exists
in relation to the Group’s capitalised exploration costs,
in accordance with AASB 6 “Exploration for and
Evaluation of Mineral Resources”, we:
− examined the minutes of the Group’s board
meetings;
− discussed with management the Group’s ability
and intention to undertake further exploration
activities.
− evaluated the Group’s assessment that there
were indicators of asset impairment at 30 June
2024.
•
In assessing whether an indicator of impairment exists
in
relation
to
the
Group’s
mine
development
expenditures
in
accordance
with
AASB
136
“Impairment of Assets”, we:
− examined the minutes of the Group’s board
meetings;
− tested the significant inputs in the Group’s cash
flow forecasts for consistency with their future
activity regarding mine development.
− evaluated the Group’s assessment that there
were indicators of asset impairment at 30 June
2024.
− considered whether the discounted cash flow
model used to estimate the recoverable amount
was consistent with Australian Accounting
Standards and the assumptions detailed
KINGSTON RESOURCES LIMITED
ABN 44 009 148 529
AND CONTROLLED ENTITIES
INDEPENDENT AUDITOR’S REPORT TO THE OWNERS OF
KINGSTON RESOURCES LIMITED
Key Audit Matter
How Our Audit Addressed the Key Audit Matter
Rehabilitation provision
Refer to Note 1(o) “Mine Development”
As a result of its mining and processing operations,
the Group is obligated to restore and rehabilitate the
land and environment disturbed by these operations
and remove related infrastructure. Rehabilitation
activities are governed by a combination of
regulatory and legislative requirements and Group
standards. At 30 June 2024, the Group had a
rehabilitation provision of $7,465,000.
This was a key audit matter due to the significant of
the balance and the required judgements in the
assessment of the nature and extent of future works
to be performed, the future cost of performing the
works, and the timing of when the rehabilitation will
take place.
Our procedures included but were not limited to:
•
Developing an understanding on how the Group
identified the relevant methods, assumptions or
sources of data that are appropriate for developing
rehabilitation plans and associated cost estimates in
the context of the Australian Accounting Standards
•
Developing an understanding of and assessing the
appropriateness of the significant assumptions and key
data used to develop the rehabilitation provision with
regard
to
applicable
regulatory
and
legislative
requirements.
•
Reviewing the adequacy of the Company’s disclosures
in respect of the accounting treatment of the
rehabilitation provision in the financial statements,
including the significant judgments involved, and the
accounting policy adopted.
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 2024, 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 that an audit conducted in accordance
with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements
can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably
be expected to influence the economic decisions of users taken on the basis of this financial report.
KINGSTON RESOURCES LIMITED
ABN 44 009 148 529
AND CONTROLLED ENTITIES
INDEPENDENT AUDITOR’S REPORT TO THE OWNERS OF
KINGSTON RESOURCES LIMITED
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.
–
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business
activities within the Group to express an opinion on the financial report. We are responsible for the
direction, supervision and performance of the Group audit. We remain solely responsible for our audit
opinion.
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.
KINGSTON RESOURCES LIMITED
ABN 44 009 148 529
AND CONTROLLED ENTITIES
INDEPENDENT AUDITOR’S REPORT TO THE OWNERS OF
KINGSTON RESOURCES LIMITED
Report on the Remuneration Report
We have audited the remuneration report included in pages 20 to 25 of the directors’ report for the year ended
30 June 2024. In our opinion, the remuneration report of Kingston Resources Limited for the year ended 30 June
2024 complies with s 300A of the Corporations Act 2001.
Auditor’s Opinion
The directors of the Company are responsible for the preparation and presentation of the remuneration report in
accordance with s 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.
HALL CHADWICK (NSW)
Level 40, 2 Park Street
Sydney NSW 2000
ANTHONY TRAVERS
Partner
Dated: 13 September 2024
CORPORATE GOVERNANCE STATEMENT
KINGSTON RESOURCES LIMITED
2024 ANNUAL REPORT
& its Controlled Entities
- 69 -
CORPORATE GOVERNANCE STATEMENT
The Board is committed to achieving and demonstrating the highest standards of corporate governance. As such
Kingston Resources Limited has adopted the fourth edition of the Corporate Governance Principles and
Recommendations which was released by the ASX Corporate Governance Council and became effective for
financial years beginning on or after 1 January 2020.
The Company’s Corporate Governance Statement for the financial year ending 30 June 2024 was approved by the
Board on 13 September 2024. The Corporate Governance Statement can be located on the Company’s website
www.kingstonresources.com.au
ADDITIONAL INFORMATION
KINGSTON RESOURCES LIMITED
2024 ANNUAL REPORT
& its Controlled Entities
- 70 -
Additional Information required by the Australia Stock Exchange Limited Listing Rules and not disclosed elsewhere in
this report.
This additional information was applicable as at 31 August 2024.
SHAREHOLDER INFORMATION
Distribution of Ordinary Shares
Distribution
No. of Shareholders
(ASX code – KSN)
Total Units
% Issued Share
Capital
above 0 up to and including 1,000
281
49,963
0.01%
above 1,000 up to and including 5,000
457
1,520,089
0.22%
above 5,000 up to and including 10,000
496
3,933,261
0.56%
above 10,000 up to and including 100,000
1,632
63,667,126
9.01%
above 100,000
560
637,849,532
90.22%
Total
3,426
707,019,971
100.00%
Holding less than a marketable parcel (based on a price of
$0.08)
860
2,266,586
Distribution of Unlisted Options
Distribution
No. of Holders
Total Units
% Issued Capital
UNLISTED OPTIONS AT $0.14, EXP 31/07/25
above 10,000 up to and including 100,000
104
3,163,988
8.32%
above 100,000
46
34,846,222
91.68%
Total
150
38,010,210
100.00%
UNLISTED LTI OPTIONS AT $0.00, EXP 31/08/24
above 10,000 up to and including 100,000
2
74,540
7.58%
above 100,000
3
909,178
92.42%
Total
5
983,718
100.00%
UNLISTED OPTIONS AT $0.00, EXP 31/08/28
above 100,000
7
4,378,207
100.00%
Total
7
4,378,207
100.00%
ADDITIONAL INFORMATION
KINGSTON RESOURCES LIMITED
2024 ANNUAL REPORT
& its Controlled Entities
- 71 -
Distribution
No. of Holders
Total Units
% Issued Capital
Distribution of Unlisted Warrants
Distribution
No. of Holders
Total Units
% Issued Capital
WARRANT @ $0.20, EXP 07/7/27
above 100,000
1
25,000,000
100.00%
WARRANT @ $0.14, EXP 29/6/28
above 100,000
1
35,714,286
100.00%
UNLISTED OPTIONS AT $0.00, EXP 31/08/29
above 100,000
9
6,399,594
100.00%
Total
9
6,399,594
100.00%
UNLISTED LTI OPTIONS AT $0.00, EXP 31/08/27
above 10,000 up to and including 100,000
4
303,530
26.76%
above 100,000
4
830,652
73.24%
Total
8
1,134,182
100.00%
ADDITIONAL INFORMATION
KINGSTON RESOURCES LIMITED
2024 ANNUAL REPORT
& its Controlled Entities
- 72 -
Statement of Top 20 Shareholders of the Quoted Equity Securities
Contributed Equity (ASX code – KSN)
Name
Holding
%
1
CITICORP NOMINEES PTY LIMITED
69,377,085
9.81%
2
WINCHESTER INVESTMENTS GROUP PTY LIMITED
64,493,591
9.12%
3
FARJOY PTY LTD
47,336,463
6.70%
4
DEUTSCHE BALATON AKTIENGESELLSCHAFT
42,997,585
6.08%
5
BNP PARIBAS NOMS PTY LTD
36,367,025
5.14%
6
DELPHI UNTERNEHMENSBERATUNG AKTIENGESELLSCHAFT
28,086,219
3.97%
7
DELPHI UNTERNEHMENSBERATUNG AKTIENGESELLSCHAFT
27,200,938
3.85%
8
BNP PARIBAS NOMINEES PTY LTD
21,675,743
3.07%
9
BNP PARIBAS NOMINEES PTY LTD
18,200,498
2.57%
10
QUINTANA RESOURCES HOLDINGS LP
11,764,705
1.66%
11
2INVEST AG
7,800,000
1.10%
12
WGS PTY LTD
7,169,888
1.01%
13
PASAGEAN PTY LIMITED
5,833,333
0.83%
14
MILAMAR GROUP PTY LTD
5,704,876
0.81%
15
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
5,504,598
0.78%
16
BERNE NO 132 NOMINEES PTY LTD <656165 A/C>
5,030,908
0.71%
17
LIANGROVE MEDIA PTY LIMITED
4,615,385
0.65%
18
BNP PARIBAS NOMS PTY LTD
36,367,025
5.14%
19
DELPHI UNTERNEHMENSBERATUNG AKTIENGESELLSCHAFT
28,086,219
3.97%
20
DELPHI UNTERNEHMENSBERATUNG AKTIENGESELLSCHAFT
27,200,938
3.85%
Total
420,377,615
59.45%
Total on Issue
707,019,971
100.00%
Substantial Shareholders
The names of the substantial shareholders who have notified the Company in accordance with section 671B of the
Corporations Act 2001 are:
Shareholder
Shares Held
% of Shares Held
Date of Last Notice
Delphi Unternehmensberatung Aktiegesellshaft and
associates
106,084,742
15%
15 May 2024
Quintana Resources Holdings LP
54,914,882
13.34%
18 January 2022
Winchester Investments Group Pty Ltd & Ian Ronald
Ingram
64,493,591
9.12%
17 May 2024
Farjoy Pty Ltd
31,951,847
6.82%
4 July 2023
Substantial Holders of Unquoted Equity Securities
Holders of more than 20% of Warrants.
HOLDERS
Number
of Units
% of Total
holding
WARRANT @ $0.20, EXP 07/7/27
PURE ASSET MANAGEMENT PTY LTD
25,000,000
100.00%
WARRANT @ $0.14, EXP 29/6/28
PURE ASSET MANAGEMENT PTY LTD
35,714,286
100.00%
ADDITIONAL INFORMATION
KINGSTON RESOURCES LIMITED
2024 ANNUAL REPORT
& its Controlled Entities
- 73 -
Voting Rights
The Company’s share capital is of one class with the following voting rights:
Fully Paid Ordinary Shares
On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each
share shall have one vote.
Unlisted Options
There are no voting rights attached to Unlisted Options.
Warrants
There are no voting rights attached to Performance Rights.
Statement of Restricted Securities
The Company has no restricted securities on issue.
On Market Buy Back
The Company is not currently conducting an on market buy back.
Other ASX Information
Stock Exchange on which the Company’s Securities are Quoted
The Company’s listed equity securities are quoted on the Australian Securities Exchange and the secondary listing of
the Company’s listed equity securities are quoted on the Frankfurt Stock Exchange.
Review of Operations
A review of operations is contained in the Directors Report.
Annual General Meeting
The Company advises that the Annual General Meeting ('AGM') of the company is scheduled for Thursday, 28 November
2024.
Further to Listing Rule 3.13.1, Listing Rule 14.3 and clause 7.2(f) of the Company's Constitution, nominations for election
of directors at the AGM must be received not less than 35 Business Days before the meeting, being no later than Thursday,
10 October 2024.
ADDITIONAL INFORMATION
KINGSTON RESOURCES LIMITED
2024 ANNUAL REPORT
& its Controlled Entities
- 74 -
5.
TENEMENT SCHEDULE
Tenement
Project Name & Location
Status
Ownership
Type
Title Area
EL1747
Misima, PNG
Live
100%
EL
180 km2
EL1999
Mineral Hill, NSW
Live
100%
EL
17 UNITS
EL8334
Mineral Hill, NSW
Live
100%
EL
100 UNITS
ML5240
Mineral Hill, NSW
Live
100%
ML
32.37 HA
ML5267
Mineral Hill, NSW
Live
100%
ML
32.37 HA
ML5278
Mineral Hill, NSW
Live
100%
ML
32.37 HA
ML332
Mineral Hill, NSW
Live
100%
ML
22.36 HA
ML333
Mineral Hill, NSW
Live
100%
ML
28.03 HA
ML334
Mineral Hill, NSW
Live
100%
ML
21.04 HA
ML335
Mineral Hill, NSW
Live
100%
ML
24.79 HA
ML336
Mineral Hill, NSW
Live
100%
ML
23.07 HA
ML337
Mineral Hill, NSW
Live
100%
ML
32.27 HA
ML338
Mineral Hill, NSW
Live
100%
ML
26.3 HA
ML339
Mineral Hill, NSW
Live
100%
ML
25.09 HA
ML340
Mineral Hill, NSW
Live
100%
ML
25.79 HA
ML1695
Mineral Hill, NSW
Live
100%
ML
8.779 HA
ML1712
Mineral Hill, NSW
Live
100%
ML
23.92 HA
ML1778
Mineral Hill, NSW
Live
100%
ML
29.05 HA
ML5499
Mineral Hill, NSW
Live
100%
ML
32.37 HA
ML5621
Mineral Hill, NSW
Live
100%
ML
32.37 HA
ML5632
Mineral Hill, NSW
Live
100%
ML
27.32 HA
ML6329
Mineral Hill, NSW
Live
100%
ML
8.094 HA
ML6365
Mineral Hill, NSW
Live
100%
ML
2.02 HA