Manhattan Corporation Limited
Annual Report 2022

Plain-text annual report

Annual Report 30 June 2022 ABN: 61 123 156 089 CONTENTS PAGE CONTENTS CORPORATE DIRECTORY DIRECTORS’ REPORT AUDITOR’S INDEPENDENCE DECLARATION CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME CONSOLIDATED STATEMENT OF FINANCIAL POSITION CONSOLIDATED STATEMENT OF CASH FLOWS CONSOLIDATED STATEMENT OF CHANGES IN EQUITY NOTES TO THE FINANCIAL STATEMENTS DIRECTORS’ DECLARATION INDEPENDENT AUDITOR’S REPORT ASX ADDITIONAL INFORMATION PAGE 1 2 27 28 29 30 31 32 53 54 58 CORPORATE DIRECTORY Directors Mr Marcello Cardaci (Non-Executive Chairman) Mr Kell Nielsen (Chief Executive Officer) Appointed as Executive Director on 24 November 2021 Mr John Seton (Non-Executive Director) The late Mr Jens Balkau (Non-Executive Director) Ceased as Director 10 November 2021 Company Secretary Ms Eryn Kestel Registered Office Level 2 33 Colin Street West Perth WA 6005 Telephone: +61 8 9322 6677 Facsimile: +61 8 9322 1961 Website: www.manhattancorp.com.au Email: info@manhattancorp.com.au Share Registry Computershare Investor Services Pty Ltd Level 2 Reserve Bank Building 45 St Georges Terrace Perth WA 6000 Telephone: 1 300 850 505 Facsimile: + 61 8 9323 2033 Auditors Rothsay Audit & Assurance Pty Ltd Level 1, Lincoln House 4 Ventnor Avenue Perth WA 6000 Securities Exchange The Company’s securities are quoted on the official list of the Australian Securities Exchange Limited, the home branch being Perth. ASX Codes: MHC and MHCO Manhattan Corporation Limited 1 2022 Annual Report to Shareholders DIRECTORS’ REPORT The Directors present their report for Manhattan Corporation Limited (“Manhattan” or “the Company”) and its subsidiaries (“the Group”) for the year ended 30 June 2022. DIRECTORS The names, qualifications, and experience of the Company’s Directors in office during the period and until the date of this report are as follows. Directors were in office for this entire period unless otherwise stated. Mr Marcello Cardaci B. Juris, LLB, B.Com Non-Executive Chairman Marcello is a partner in the Australian legal practice of Gilbert + Tobin. Mr Cardaci holds degrees in law and commerce and is experienced in a wide range of corporate and commercial matters with a particular emphasis on public and private capital equity raisings and mergers and acquisitions. Gilbert + Tobin specializes in the provision of legal advice to companies involved in various industries including resources and manufacturing. Mr Cardaci is a Director of Alta Zinc Limited (formerly Energia Minerals Limited) (appointed 7 October 2014) and is a former Director of Cyprium Metals Ltd (resigned 10 July 2019). He has not held any other listed directorships over the past three years. Mr Kell Nielsen BSc(Geol), MSc(MinEcon), MAusimm Chief Executive Officer (Appointed as Director on 24 November 2021 and as CEO on 23 April 2020) Kell is an Australian Geologist with over 25 years’ experience in project generation, exploration, and development across a broad range of minerals including gold, copper and base metals. Mr Nielsen has worked extensively in Australia, Mongolia, West and East Africa and Myanmar covering a diverse range of experiences and roles from grass roots exploration to being at the forefront of discoveries and managing large resource development teams for Placer Dome (Wallaby resource definition >10Moz Au) and consulting to BHP Billiton’s iron ore and coal divisions. Mr John Seton LLM (Hons) Non-Executive Director John is an Auckland based solicitor with over 35 years’ experience in commercial law, stock exchange listed companies and the mineral resources sector. Mr Seton has an extensive skill set together with vast experience gained from sitting on many boards in Australia, New Zealand and overseas based companies both as an Executive and Non-Executive Director. Mr Seton is currently an Executive Director of Besra Gold Inc. (ASX:BEZ) and a Director of Good Spirits Hospitality Limited (NZX:GSH). In the past three years Mr Seton has held a directorship in formerly ASX-listed Tomizone Limited. Manhattan Corporation Limited 2 2022 Annual Report to Shareholders DIRECTORS’ REPORT (Continued) The late Mr Jens Balkau BSc Hon, MSc DIC Non-Executive Director (Ceased as Director on 10 November 2021) COMPANY SECRETARY Eryn Kestel B. Bus, CPA Eryn is a Certified Practicing Accountant with more than 28 years’ corporate experience that includes over 13 years in the role of Company Secretary for ASX listed companies. Ms Kestel has not held any listed directorships over the past three years. INTERESTS IN THE SECURITIES OF THE COMPANY As at the date of this report the interests of the Directors in the securities of Manhattan Corporation Limited are: Director Mr. M. Cardaci Mr. K Nielsen Mr. J. Seton Options over Ordinary Shares exercisable at 1 Performance Ordinary Shares cent each Shares 3,567,241 2,250,000 1,575,785 - 10,000,000 - - - - Note: Includes shares held directly, indirectly and beneficially by Key Management Personnel. RESULTS OF OPERATIONS The Group’s net loss after taxation attributable to the members of Manhattan Corporation for the year to 30 June 2022 was $536,024 (30 June 2021: $599,020). DIVIDENDS No dividend was paid or declared by the Group in the period and up to the date of this report. CORPORATE STRUCTURE Manhattan Corporation Limited is a Company limited by shares, which is incorporated and domiciled in Australia. NATURE OF OPERATIONS AND PRINCIPAL ACTIVITIES During the period, the principal activity was mineral exploration and development and evaluation of mineral projects and corporate opportunities in the resource sector worldwide. EMPLOYEES The Group has nil employees at 30 June 2022 (30 June 2021: nil). Manhattan Corporation Limited 3 2022 Annual Report to Shareholders DIRECTORS’ REPORT (Continued) RESULTS OF OPERATIONS OVERVIEW During the year ended 30 June 2022, Manhattan Corporation Limited (MHC or the Company) continued to advance the Tibooburra Gold Project, with a Reverse Circulation (RC) drill programme where significant high- grade mineralisation was intercepted. TIBOOBURRA GOLD PROJECT New South Wales MHC Controls 100% of the Tibooburra Gold Project in the Far NW of New South Wales (NSW) through its fully owned subsidiary Awati Resources Pty Ltd (Awati). The Tibooburra Gold Project comprises a nearly contiguous land package of 15 granted exploration licences (~2,200 square kilometres) that are located approximately 200km north of Broken Hill (Figures 1-2). It stretches 160km south from the historic Tibooburra townsite and incorporates a large proportion of the Albert Goldfields (which produced in excess of 50,000 to 100,000 ounces of Au from auriferous quartz vein networks and alluvial deposits during its short working life), along the gold-anomalous (soil, rock and drilling geochemistry, gold workings) New Bendigo Fault, to where it merges with the Koonenberry Fault, and then strikes further south on towards the recently discovered Kayrunnera gold nugget field. The area is conveniently accessed via the Silver City Highway, which runs N-S through the project area. Figure 1 – Location of the Tibooburra Gold Project Manhattan Corporation Limited 4 2022 Annual Report to Shareholders DIRECTORS’ REPORT (Continued) Figure 2 – Prospective Palaeozoic gold terrains (green shading) of NSW and Victoria. During the reporting period, MHC continued to advance its Tibooburra Project primarily focussed on New Bendigo (including Main Zone), Pioneer, Jeffery’s Flat, Phoenix and Silverton (Figure 3). Exploration drilling was completed over multiple campaigns, including: ▪ ▪ Twenty RC holes (NB0073-0092) for 2,131m completed at New Bendigo in October and November 2021; Thirty-two RC holes (NB0093-124) for 4,241 metres completed at New Bendigo during January – March 2022; ▪ Four diamond holes (NBD0004-0007) and two diamond tails of previously drilled RC holes (NB0107 & NB0123) for 709.8 metres of core and 111.8m of Rotary Mud (RM) precollars completed at New Bendigo; ▪ MHC completed nine (9) RC Holes (NB00125-0127, PN0001-04 & JF0001-002) for 1,434 metres during the period at Pioneer and Phoenix, Jeffery’s Flat, New Bendigo South and Silverton. Manhattan Corporation Limited 5 2022 Annual Report to Shareholders DIRECTORS’ REPORT (Continued) Figure 3 – Tibooburra Project – Northern Target Areas (TMI RTP 1VD Grey Scale Aeromagnetic Image Background). Manhattan Corporation Limited 6 2022 Annual Report to Shareholders DIRECTORS’ REPORT (Continued) New Bendigo RC Drilling – October-November 2021 MHC completed twenty (20) Reverse Circulation Drill (RC) Holes (NB0073-0092) for 2,131 metres at its Tibooburra Gold Project located in north-western NSW during the reporting period. Drilling focussed on testing the shallow nature of identified mineralisation, including targeting potential for plunging shoots within the lower grade NNW trending mineralised corridor that extends for approximately 650 metres of strike. Drilling successfully intersected high-grade mineralised zones that were thought to form two separate north plunging shoots located to the north and south of a cross-cutting fault, though further drilling was required in this area to confirm the synopsis, specifically in the vicinity of the fault and the continuation of the shoots at depth where they remained open. Drilling returned significant mineralisation in addition to the previously reported near surface high-grade central zone (Figures 4), including: ▪ ▪ ▪ ▪ ▪ ▪ 8m at 40.5 g/t Au from 70m, including 3m at 105.34 g/t Au (NB0089); 16m at 13.89 g/t Au from 1m, including 3m at 69.20 g/t Au (NB0083); 7m at 2.89 g/t Au from 56m, including 1m at 15.45 g/t Au (NB0088); 6m at 1.93 g/t Au from 12m, including 2m at 4.29 g/t Au (NB0090); 3m at 4.67 g/t Au from 126m, including 2m at 6.74 g/t Au (NB0081); and 8m at 1.08 g/t Au from 18m, including historically mined stope from 10.5 to 14m (NB0079). Further to the high-grade central zone and the interpreted plunging shoots, drilling successfully increased the mineralised footprint within the broader lower grade halo of the NNW trending regional shear with all RC holes reporting significant mineralisation2 that remains open along strike to the south, the north and down-dip. Drilling returned significant results, including: ▪ ▪ 5m at 1.03 g/t Au from 31m (NB0076); and 4m at 2.16 g/t Au from 24m (NB0082). Drilling completed on the “Main Zone” had still only tested a small portion of an elongated >5km long soil anomaly (Figure 3), where historic workings extend over at least 1.5 km of strike along the interpreted Main Zone. Manhattan Corporation Limited 7 2022 Annual Report to Shareholders DIRECTORS’ REPORT (Continued) Figure 4: New Bendigo Drill Hole Collar Plan showing recent RC drill holes in relation to previous drilling. Drill traces are projected to surface. Note the fault is inferred and further drilling is required to delineate mineralisation proximal to the fault New Bendigo. Location of Long Section (Figure 3) shown. Recent highlighted intersections are shown as yellow callouts. Manhattan Corporation Limited 8 2022 Annual Report to Shareholders DIRECTORS’ REPORT (Continued) New Bendigo RC Drilling – January-April 2022 During January through to April 2022, MHC completed a further 32 holes (NB0093-124) for 4,241 metres. Drilling targeted additional mineralisation and the north plunging shoots along the “Main Zone” corridor, a NNW trending gold mineralised shear system that extends for over 650 metres of strike that is located within an under explored elongated >5km long soil anomaly where historic workings extend over at least 1.5 km of strike. Drilling continued to successfully intersect significant shallow gold mineralisation within the corridor, often from or near surface. Further high-grade mineralised zones were thought to form two separate north plunging shoots located to the north and south of a cross-cutting fault. Drilling confirmed the potential for “Main Zone” to host a significant shallow, high-grade gold resource, with drilling intersecting significant mineralisation (Figure 5), including: ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ 63m at 1.33 g/t Au from 24m including 9m at 7.22 g/t Au from 56m (NB0105); 17m at 1.13 g/t Au from 4m including 4m at 2.42 g/t Au from 6m (NB0093); 3m at 4.51 g/t Au from 9m, and 2m at 3.90 g/t Au from 126m (NB0106); 2m at 3.18 g/t Au from 82m (NB0098); 2m at 4.08 g/t Au from 84m (NB0102); 24m at 0.52 g/t Au from 47m including 9m at 1.06 g/t Au from 58m (NB0090); 19m at 5.02 from 92m, including 7m at 13.10 from 97m (NB0113); 13m at 6.16 from 50m, including 3m at 25.48 from 51m and 8m at 2.52 g/t Au from 70m (NB0122); 13m at 1.41 from 87m, including 3m at 4.65 g.t Au from 90m (NB0109); 3m at 4.32 from 10m and 2m at 1.20 g/t Au from 108m (NB0110); 2m at 1.70 g/t Au from 64m (NB0112); 2m at 1.01 from 109m, 1m at 2.87 from 122m and 1m at 1.48 g/t Au from 130m (NB0113); 1m at 11.10 from 9m and 2m at 1.07 g/t Au from 126m (NB0114); 2m at 1.51 g/t Au from 44m (NB0115); 20m at 0.60 from 90m, including 2m at 3.11 g/t Au from 107m (NB0118); and 4m at 1.87 from 6m and 2m at 2.77 g/t from 117m (NB0123). Manhattan Corporation Limited 9 2022 Annual Report to Shareholders DIRECTORS’ REPORT (Continued) Figure 5: New Bendigo Drill Hole Collar Plan showing recent RC drill holes results (completed in 2022) in relation to previous drilling. Drill traces are projected to surface. Note the fault is inferred and further drilling is required to delineate mineralisation proximal to the fault New Bendigo. Recent highlighted intersections are shown as yellow callouts. Manhattan Corporation Limited 10 2022 Annual Report to Shareholders DIRECTORS’ REPORT (Continued) New Bendigo Diamond Drilling – July 2022 MHC completed Diamond Drilling at New Bendigo “Main Zone” and “Western Lode” in July 2022 with a total of four diamond holes (NBD0004-0007) and two diamond tails completed on previously drilled RC holes (NB0107 & NB0123) for 709.8 metres of core and 111.8m of rotary mud (RM) precollars. Drilling was focused on evaluating the high-grade mineralisation that is interpreted to be associated with plunging veins and or shoots that has returned significant results and formed part of a structural review. Cutting and processing of the core was delayed allowing for the core to be reviewed intact (where required) by Structural consultants engaged by the Company. This has now been completed and all the core has been cut and submitted for analysis. Apart from the re-entry of NB0107, all diamond results remain outstanding. To date, only the analysis of the re-entry of NB0107 has been returned. NB0107 and NB0123 were re-entered as the originally planned RC holes were unable to reach their planned depth due to excessive water being intersected. NB0107 returned a peak result of 0.55m at 2.29 g/t Au from 138.2m. New Bendigo Structural Study – August-September 2022 Following the successful diamond drilling programme completed in July at New Bendigo, MHC prioritised plans to undertake structural mapping, review of diamond core and the acquisition of downhole imagery (Televiewer) to assess the origin of the high grade. The review was undertaken to provide the basis for MHC to target high-grade mineralisation at New Bendigo in order for the company to effectively model and target the higher grades in future drilling and allow for the grades to be fairly represented in any future resource calculation The initial stage of the structural study identified: ▪ ▪ That intersection lineations between the regional shear foliation (penetrative fabric) and cross-cutting structural features such as veins and discrete shears may exert a plunge control on gold mineralisation, potentially promoting the formation of high-grade shoots; and The lower grade material intersected within the dominant shear (New Bendigo Fault Zone), may be related to bleeding/remobilisation of the higher-grade mineralisation proximal (up and down) the predominant shear fabric from high-grade mineralisation that has been formed from the intersection lineations. The structural study was undertaken under the supervision of MHC’s Structural Consultants led by Dr John Beeson (Geoscience Now) and Mr Peter Croft (Brockman Solutions) included field mapping, a review of the recently acquired diamond core and the acquisition and interpretation of televiewer data of selected holes. Mapping completed of the surface outcrops at New Bendigo identified a strong, NNW-trending penetrative fabric associated with the Koonenberry Fault, with numerous quartz veins oriented sub-parallel to the penetrative fabric. A number of steeply-dipping, cross-cutting quartz-rich tensional veins have also been mapped and observed in core (Figures 2 to 4), varying in trend between NE-SW to ENE-WSW, together with discrete cross cutting shears developed at an acute clockwise angle to the penetrative fabric. Manhattan Corporation Limited 11 2022 Annual Report to Shareholders DIRECTORS’ REPORT (Continued) On the basis of this information, a three-dimensional (3D) model was created to assess the relationship between the various structural features and existing drilling coverage proximal to the new Bendigo workings. The model suggests that high grade gold mineralisation is related to the penetrative fabric, the fabric sub-parallel quartz veins, with cross cutting quartz veins and discrete shears potentially associated with high-grade intercepts. The Structural Consultants’ Interpretation of this model is that intersection lineations between these structural elements may exert a plunge control on gold mineralisation, that may promote formation of discrete high-grade shoots within the shear system. Further drilling is required to determine whether the high-grade mineralisation shows continuity along the penetrative fabric and sub-parallel quartz veins or the cross-cutting structures, or both. Exploration RC Drilling – April 2022 MHC completed RC drilling in April on exploration targets where Au mineralisation had been identified through either drilling or historic mining activity within the northern part of the Tibooburra Gold Project (~25km gold mineralised strike). In all MHC completed nine (9) RC Holes (NB00125-0127, PN0001-04 & JF0001-002) for 1,434 metres during the period. Pioneer and Phoenix Located ~18km north of the “Main Zone”, the Pioneer-Phoenix trend hosts historical gold workings over ~5km of strike and was home to a historic gold stamping battery and the largest of the historic mines on the Albert Goldfield (Pioneer). Limited historic drilling in the area has returned significant Au in diamond and RC drilling, including 3m at 4.89 (AWNPN02A) and 2m at 14.72 g/t Au. MHC completed four (4) RC holes (PN0001-04) for 732 metres to test the system, particularly at depth (PN0002 – Figure 5) as well as a parallel lode that had not been previously drill tested (PN0004). Drilling intercepted shale, with each hole hosting multiple zones of significant quartz-pyrite veining. Results have now been returned for all holes, returning significant Au, including: ▪ ▪ ▪ ▪ ▪ 5m at 6.96 g/t Au from 199m, including 1m at 33.90 g/t Au from 199m (PN0002); 2m at 1.66/g/t Au from 90m (PN0001); 3m at 1.28 g/t Au from 67m (PN0003); 4m at 0.52 g/t Au from 124m (PN0004); and 13m at 0.51 g/t Au from 146m (PN0004). Jeffery’s Flat Located ~ 1,800 metres to the north of the Pioneer Mine, Jeffery’s Flat hosts historic workings. MHC completed two (2) RC holes at Jeffery’s Flat during the quarter (JF0001-02) for 330 metres. Drilling intercepted interbedded sandstone and siltstone units. JF0001 intersected two zones (31-35m, 49-55m) of quartz veining within weathered material associated with considerable haematite and goethite alteration. Below the weathered interface, JF0001 intercepted quartz veining between 69-81 and 139-146m associated with pyrite mineralisation. JF0002 intercepted two moderate zones of quartz veining – 75-80m and 144-148m with traces of pyrite. Results from Jeffery’s Flat returned minor Au, with no significant Au being returned. Manhattan Corporation Limited 12 2022 Annual Report to Shareholders DIRECTORS’ REPORT (Continued) New Bendigo South & Silverton Results from Silverton returned minor Au, with no significant Au being returned from New Bendigo South. These results will be reviewed in line with the recent data collected from diamond core drilling currently being completed at New Bendigo. Figure 6: Pioneer Prospect, Drill Section 6,731,480 North Manhattan Corporation Limited 13 2022 Annual Report to Shareholders DIRECTORS’ REPORT (Continued) New Bendigo Aircore Drilling – May 2021 Results from Aircore drilling (AC) undertaken at “Main Zone” and elsewhere completed during the 2020-21 Financial year were reported during the period. Drilling at “Main Zone” was designed to scope out the structural controls on high-grade mineralisation previously intersected in RC drilling at “Main Zone” (30m at 4.03 g/t Au, NB0033) and “Western Lode” (7m at 18.16 g/t Au, NB0023) utilising closely spaced Aircore drilling. Aircore was undertaken in preference to further diamond drilling to confirm the interpretation of the structural controls on mineralisation, where obtaining orientated diamond core in weathered, brecciated and fractured material proved extremely difficult within the near surface area. Drilling undertook the form of two lines (13 holes), NBAC0179-187 and NBAC203-206) of closely spaced AC to the NE and the SW of the shallow high-grade where no effective drill coverage existed. Results have now been returned for NBAC0179-187. Drilling returned exception results3, including: ▪ ▪ 12m at 2.78 g.t Au from surface, including 4m at 7.63 g/t Au (NBAC0181); and 8m at 1.78 g/t Au from surface, including 4m at 3.29 g/t Au (NBAC0183). Jefferies Flat, Pioneer and Phoenix Aircore – June 2021 MHC completed a further 58 AC holes over the far northern section of the mineralised corridor in June 2021 with results being received during the reporting period. Drilling extended for over 6 kilometres north from Pioneer where previous drilling returned 3m at 4.89 g/t Au from 69.8m (Diamond Hole AWPN02A) and 2m at 14.72 g/t Au from 88m (RC Hole TP003) to Phoenix and Jefferies Flat to Jefferies Flat. Planned drilling was reduced at Jefferies Flat due to shallower weathering being intersected. A peak result of 4m at 0.59 g/t AU was returned (JFAC001). Sandy Well and North Sandy Well Aircore – June 2021 Limited drilling was undertaken in the Sandy Well area where cross-cutting structures intersect the main regional structures. Drilling intersected thick transported cover with all results received during the reporting period with significant mineralisation (4m at 1.19 g/t Au from 92m) was returned in SWAC004. Further drilling is not planned. Manhattan Corporation Limited 14 2022 Annual Report to Shareholders DIRECTORS’ REPORT (Continued) PONTON URANIUM PROJECT Western Australia MHC still maintains its Ponton Uranium Project in Western Australia (WA). No exploration or development was carried out on the Project during the reporting period. The Ponton Uranium Project is a potential future low-cost in-situ metal recovery (ISR) development opportunity located in Western Australia. The Project comprises key Exploration Licence E28/1898 and a further Exploration Licence Application (ELA 28/2454) The Project is located within the remote Queen Victoria Spring Nature Reserve (QVSNR), 200km east northeast of Kalgoorlie. The WA state Labor government’s policies of not to approve new uranium mines, or to allow mineral exploration in reserves, suggests there is little likelihood of progressing the exploration and development of the Ponton uranium project over the current four-year term of the present WA government. Manhattan will endeavour to maintain its Ponton Uranium Project with a view that the uranium price may improve in the future and the WA government will change or its policies on uranium approvals and exploration access to reserves will change. On 23 January 2017 Manhattan reported an upgraded JORC Code 2012 Inferred Resource for the Double 8 uranium deposit at Ponton in WA of 26 million tonnes (Mt), for 17.2 million pounds (Mlb) grading 300ppm uranium oxide (U3O8) at a 200ppm cutoff. The Inferred Resource estimate reported for Ponton project is: ▪ Double 8 uranium deposit of 17.2 Mlb U3O8 at 200ppm cutoff. Exploration Results at Ponton, reported on 7 February 2014, have also identified four wide spaced drilled Exploration Targets, namely: ▪ Stallion South of between 8 and 16Mlb U3O8; ▪ Highway South of between 8 and 16Mlb U3O8; and ▪ Ponton of between 15 and 30Mlb U3O8. For full details of reported Mineral Resource Estimates and Exploration Targets, Competent Person’s consent, material assumptions and technical parameters for the Ponton Project refer to Manhattan ASX announcements dated 23 January 2017 and 7 February 2014. Manhattan Corporation Limited 15 2022 Annual Report to Shareholders DIRECTORS’ REPORT (Continued) Ponton Uranium Project Inferred Resource There has been no change to the Mineral Resource Estimates from 30 June 2018 Annual Report up to the date of this report. Figure 07 – Ponton Uranium Project Manhattan Corporation Limited 16 2022 Annual Report to Shareholders CUTOFF GRADE eU3O8(ppm)TONNES (MILLION) GRADE eU3O8(ppm)TONNES U3O8(t)POUNDS (MILLION) U3O8(Mlb)10011017018,70042.01505124012,24026.0200263007,80017.2250143605,04011.0DOUBLE 8 INFERRED RESOURCE ESTIMATES DIRECTORS’ REPORT (Continued) Figure 08 – Manhattan’s Ponton Figure 09 – Double 8 Inferred Resources – Double 8, Stallion South, Highway South & Ponton Exploration Targets. Manhattan Corporation Limited 17 2022 Annual Report to Shareholders DIRECTORS’ REPORT (Continued) TENEMENTS During the reporting period the last of the tenements covering the Tibooburra Gold Project with an expiry due in either 2021 or 2022 were extended beyond June 2026. The Ponton Project comprises key Exploration Licence E28/1898 and a further Exploration Licence Application (ELA 28/2454) (Figure 8). Details of the licences are tabled Below: Table 1 – Tibooburra Gold Project Tenements I Table 2 – Ponton Uranium Project Tenements Manhattan Corporation Limited 18 2022 Annual Report to Shareholders DIRECTORS’ REPORT (Continued) JORC Code, 2012 Edition – Table 1 As required by ASX Listing Rule 5.7, the relevant information and Tables required for previously announced results under the JORC Code can be found in the following announcements. In reference to results quoted for previous drilling, please refer to the following announcements for the results and their respective JORC Tables for the quoted intersections for drill holes using the following prefixes: ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ “TIBRB” or “AW” – Reported by MHC on the 11/02/2020, “Drilling – Tibooburra Gold Project”; “NB0001-32” – Reported by MHC on the 25/06/2020, “New High-Grade Gold Discovery”; “NB0033-72” – Reported by MHC on the 12/10/2020, “Spectacular High-Grade Gold Continues at New Bendigo”; “NB0072-93” – Reported by MHC on the 10/12/2021 “8m at 40.5 g/t Au intersected including 3m at 105.34 g/t Au”; “NB0094-107” – Reported by MHC on the 23/03/2022 “Outstanding Wide Zones of Shallow Gold”; “NB00108-124” – Reported by MHC on the 29/06/22 “Visible Gold and New High Grade at Pioneer”; “NBD0001-003” – Reported by MHC on the 16/12/2021 “Aircore Discovers New Gold Zone” and 29/07/2021 “2021 March Quarter Activities Report”; “NBAC0001-105” – Reported by MHC on the 16/12/2021 “Aircore Discovers New Gold Zone” and 29/07/2021 “2021 March Quarter Activities Report”; and “NBAC0106-206” – Reported by MHC on the 22/07/2021 and the 30/06/2021 “More High Grade at New Bendigo Main Zone” and “2021 June Quarter Activity Report”. In reference to results quoted for the Pioneer Prospect included in text and Figures drill holes AWPN02A and TP003, results have been recalculated using an 0.5 g/t Au lower grade cut with a maximum of 2m of internal waste from the previously released results that were tabled with their respective JORC Tables by MHC on the 02/12/2019, “Manhattan to Acquire New High-Grade Gold Project in NSW”. References Greenfield J and Reid W, 2006. Orogenic gold in the Tibooburra area of north-western NSW – a ~440Ma ore system with comparison to the Victoria Goldfields. ASEG Extended Abstracts, 2006:1, 1-8, DOI: 10.1071/ASEG2006ab059. Competent Persons Statement The information in this Report that relates to Exploration Results for the Tibooburra Project is based on information review by Mr Kell Nielsen who is the CEO of Manhattan Corporation Limited and is a Member of the Australasian Institute of Mining and Metallurgy. Mr Nielsen has sufficient experience which is relevant to this style of mineralisation and type of deposit under consideration and to the overseeing activities which he is undertaking to qualify as a Competent Person as defined in the 2004 and 2012 Editions of the “Australasian Code for Reporting of Exploration Results, Minerals Resources and Ore Reserves’. Mr Nielsen consents to the inclusion in the report of the matters based on his reviewed information in the form and context in which it appears. Forward looking statements This announcement may contain certain “forward-looking statements” which may not have been based solely on historical facts, but rather may be based on the Company’s current expectations about future events and results. Where the Company expresses or implies an expectation or belief as to future events or results, such expectation or belief is expressed in good faith and believed to have a reasonable basis. However, forward looking statements are subject to risks, uncertainties, assumptions and other factors, which could cause actual results to differ materially from future results expressed, projected or implied by such forward- looking statements. Such risks include, but are not limited to third party actions, metals price volatility, currency fluctuations and variances in exploration results, ore grade or other factors, as well as political and operational risks, and governmental regulation and judicial outcomes. For a more detailed discussion of such risks and other factors, see the Company’s Annual Reports, as well as the Company’s other releases. The Company does not undertake any obligation to release publicly any revisions to any “forward-looking statement” to reflect events or circumstances after the date of this announcement, or to reflect the occurrence of unanticipated events, except as may be required under applicable securities laws. Manhattan Corporation Limited 19 2022 Annual Report to Shareholders DIRECTORS’ REPORT (Continued) SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS There have been no significant changes in the state of affairs of the Company during year to 30 June 2022 and up to the date of this report. SIGNIFICANT EVENTS AFTER THE BALANCE DATE No matters or circumstance have arisen since 30 June 2022 which significantly affected or could significantly affect the operations of the consolidated group in future financial years. LIKELY DEVELOPMENTS AND EXPECTED RESULTS OF OPERATIONS Likely developments in the operations of the Company are set out in the above review of operations in this annual report. Any future prospects are dependent upon the results of future exploration and evaluation. ENVIRONMENTAL REGULATIONS AND PERFORMANCE The Group carries or carried out operations that are subject to environmental regulations under legislation in Australia. The Group has formal procedures in place to ensure regulations are adhered to. The Group is not aware of any breaches in relation to environmental matters. SHARE OPTIONS As at the date of this report, there were 214,000,001 unissued ordinary shares under options and 300,000,000 performance shares on issue. The details of the options at the date of this report are as follows: Number Exercise Price $ Expiry Date 14,000,000 200,000,001 214,000,001 0.01 28 April 2023 0.01 1 August 2023 No option holder has any right under the options to participate in any other share issue of the Company or any other entity. Manhattan Corporation Limited 20 2022 Annual Report to Shareholders DIRECTORS’ REPORT (Continued) INDEMNIFICATION AND INSURANCE OF DIRECTORS AND OFFICERS The Company has made an agreement indemnifying all the Directors and officers of the Company against all losses or liabilities incurred by each Director or officer in their capacity as Directors or officers of the Company to the extent permitted by the Corporations Act 2001. The indemnification specifically excludes wilful acts of negligence. The Company paid insurance premiums in respect of Directors’ and Officers’ Liability Insurance contracts for current officers of the Company, including officers of the Company’s controlled entities. The liabilities insured are damages and 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 entities in the Group. The total amount of insurance premiums paid has not been disclosed due to confidentiality reasons. DIRECTORS’ MEETINGS During the period ended 30 June 2022, in addition to regular Board discussions, the number of meetings of directors held and the number of meetings attended by each director were as follows: Director Attend Meetings Attended Number of Meetings Eligible to Number of 5 Mr Marcello Cardaci Mr Kell Nielsen(1) Mr John Seton The late Mr Jens Balkau (2) Notes: (1) Mr Nielsen appointed as Director on 24 November 2021 and as CEO on 23 April 2020 (2) The late Mr Balkau ceased as Director on 10 November 2021. 5 3 5 2 3 5 - PROCEEDINGS ON BEHALF OF COMPANY No person has applied for leave of court to bring proceedings on behalf of the Company or intervene in any proceedings to which the Company is a party for the purpose of taking responsibility on behalf of the Company for all or any part of those proceedings. The Company was not a party to any such proceedings during the year. CORPORATE GOVERNANCE In recognising the need for the highest standards of corporate behaviour and accountability, the Directors of Manhattan Corporation Limited support and have adhered to the principles of sound corporate governance. The Board recognises the recommendations of the Australian Securities Exchange Corporate Governance Council and considers that Manhattan Corporation complies with those guidelines to the extent possible, which are of importance to the commercial operation of a junior listed resources company. In accordance with ASX Listing Rule 4.10.3 the Company has elected to publish its Corporate Governance Statement on the Company website at https://manhattcorp.com.au/corporate/corporate-governance/. AUDITOR INDEPENDENCE AND NON-AUDIT SERVICES Section 307C of the Corporations Act 2001 requires the Company’s auditors to provide the Directors of Manhattan Corporation with an Independence Declaration in relation to the audit of the financial report for the year ended 30 June 2022. A copy of that declaration is included on page 27. Manhattan Corporation Limited 21 2022 Annual Report to Shareholders DIRECTORS’ REPORT (Continued) REMUNERATION REPORT (AUDITED) This report outlines the remuneration arrangements in place for Directors and Executives of Manhattan Corporation Limited in accordance with the requirements of the Corporations Act 2001 and its Regulations. For the purpose of this report, Key Management Personnel (KMP) of the Company are defined as those persons having authority and responsibility for planning, directing and controlling the major activities of the Group, directly or indirectly, including any Director (whether executive or otherwise) of the Group The report contains the following sections: 1. 2. 3. 4. 5. 6. Key Management Personnel covered by this Remuneration Report; Remuneration Governance; Details of Remuneration; Share Based Remuneration; Additional disclosures relating to options and shares; and Service Agreements. 1. Key Management Personnel covered by this Remuneration Report The following were KMPs of the Group at any time during the years ended 30 June 2021 and 30 June 2022 and unless otherwise indicated, KMPs for the entire period: Non–Executive Directors Mr Marcello Cardaci Mr John Seton The late Mr Jens Balkau (2) Notes: (1) Mr Nielsen appointed as Director on 24 November 2021 and as CEO on 23 April 2020 (2) The late Mr Balkau ceased as Director on 10 November 2021. Executive Director and other KMP Mr Kell Nielsen (1) There were no other changes to KMPs after the reporting date and before the date of the financial report. 2. Remuneration Governance The Board is responsible for determining and reviewing compensation arrangements for the Directors. The Board assesses the appropriateness of the nature and amount of emoluments of such officers on a periodic basis by reference to relevant employment market conditions with the overall objective of ensuring maximum stakeholder benefit from the retention of a high-quality board and executive team. Currently the Group does not link the nature and amount of the emoluments of such officers to the Group’s financial or operational performance. The expected outcome of this remuneration structure is to retain and motivate Directors. As part of its Corporate Governance Policies and Procedures, the Board has adopted a formal Remuneration Committee Charter. Due to the current size of the Group and number of Directors, the Board has elected not to create a separate Remuneration Committee but has instead decided to undertake the function of the Committee as a full Board under the guidance of the formal Charter. Manhattan Corporation Limited 22 2022 Annual Report to Shareholders are as follows: 30 June 2022 Director Mr. M Cardaci Mr. K Nielsen (1) Mr. J Seton The late Mr. J Balkau (2) Total 30 June 2021 Director Mr. M Cardaci Mr. K Nielsen (1) Mr. J Seton The late Mr. J Balkau (2) DIRECTORS’ REPORT (Continued) 3. Details of Remuneration Details of the nature and amount of each element of the emolument of each Director and Executive of the Group Short Term Options Base Salary $ Directors Fees $ Consulting Fees $ Post employment Superannuati on $ Share Based Payment $ Total $ Performance Related % - - - - - - - - - 42,000 21,000 27,000 13,000 - 200,000 - - 103,000 200,000 36,000 - 24,000 36,000 - 200,000 - - - - - - - - - - - - - - - - - - - - 42,000 221,000 27,000 13,000 303,000 36,000 200,000 24,000 36,000 296,000 - - - - - - - - - - Total Notes: (1) Mr Nielsen appointed as Director on 24 November 2021 and as CEO on 23 April 2020. (2) The late Mr Balkau ceased as Director on 10 November 2021. 200,000 96,000 - - - 4. Share Based Remuneration The terms and conditions of each grant of options affecting remuneration in the previous, this or future reporting periods are as follows: Grant date Grant number Expiry date Value per options at grant date Value of options at grant date Exercise price No. Vested No. Expired - - - Director Mr. K Nielsen (1) The late Mr. J Balkau (2) 28/04/2020 10,000,000 28/04/2023 $0.004 $39,000 $0.01 10,000,000 6/04/2020 6,474,138 1/08/2023 $0.002 $12,948 $0.01 6,474,138 Total Notes: (1) Mr Nielsen appointed as Director on 24 November 2021 and as CEO on 23 April 2020. (2) Mr Balkau ceased as Director on 10 November 2021. The share-based payment included in the table relates to the 16,474,138 16,474,138 acquisition of Awati Resources Pty Ltd. Options over shares in Manhattan are granted to Directors, consultants and employees as consideration and are approved by a general meeting of shareholders. The options are designed to provide long term incentives for executives and non-executives to deliver long term shareholder returns. Participants are granted options which are granted for no issue consideration and the exercise prices will be such price as determined by the board, at its absolute discretion, on or before the date of issue. There were no alterations to the terms and conditions of options granted as remuneration since their grant date. Manhattan Corporation Limited 23 2022 Annual Report to Shareholders DIRECTORS’ REPORT (Continued) Options granted as part of remuneration have been valued using the Black-Scholes option pricing model, which takes account of factors such as the option exercise price, the current level and volatility of the underlying share price and the expected time to maturity of the option. Options granted under the plan carry no dividend or voting rights. During the year there were no options provided as remuneration to Directors or other Key Management Personnel of the Company. When exercisable, each option is convertible into one ordinary share of Manhattan. 5. Additional disclosures relating to options and shares Share holdings of Key Management Personnel The number of shares in the Company held during the period and up to the date of this report by each director and executive of Manhattan Corporation Limited, including their personally related parties, is set out below. There were no shares granted during the reporting period as compensation. Opening Balance Number Issued Share Purchases Share Sales or Other changes Closing Balance 30 June 2022 Director Mr. M Cardaci Mr. K Nielsen (1) Mr. J Seton (2) The late Mr. J Balkau (3) Total 30 June 2021 Director Mr. M Cardaci Mr. K Nielsen (1) Mr. J Seton (2) The late Mr. J Balkau (3) 3,567,241 2,250,000 1,575,785 25,896,554 33,289,580 3,567,241 1,500,000 25,578,761 25,896,554 - - - - - - - - - - - - - - - - - (25,896,554) 3,567,241 2,250,000 1,575,785 - (25,896,554) 7,393,026 - 750,000 - - - - (24,002,976) - 3,567,241 2,250,000 1,575,785 25,896,554 Total Notes: Includes shares held directly, indirectly and beneficially by Key Management Personnel. (1) Mr Nielsen appointed as Director on 24 November 2021 and as CEO on 23 April 2020. (2) Mr Seton’s holding reflects his resignation as Director of Minvest Securities (New Zealand) and the removal of his (24,002,976) 33,289,580 56,542,556 750,000 - beneficial holding in Minvest Securities of 24,002,976 (3) The late Mr Balkau ceased as Director on 10 November 2021. Manhattan Corporation Limited 24 2022 Annual Report to Shareholders DIRECTORS’ REPORT (Continued) Option holdings of Key Management Personnel The numbers of options over ordinary shares in the Company held during the period by each director of Manhattan Corporation Limited and specified executive of the group, including their personally related parties, are set out below: Opening Balance Number Issued Number Exercised Expired or other changes Closing Balance Exercisable Non- exercisable Vested options 30 June 2022 Director Mr. M Cardaci Mr. K Nielsen (1) Mr. J Seton The late Mr. J Balkau (2) Total 30 June 2021 Director Mr. M Cardaci Mr. K Nielsen (1) Mr. J Seton The late Mr. J Balkau (2) - 10,000,000 - 6,474,138 16,474,138 - 10,000,000 - 6,474,138 - - - - - - - - - - - - - - - - - 10,000,000 10,000,000 - - - - - (6,474,138) - (6,474,138) 10,000,000 10,000,000 - - - - - - - - 10,000,000 10,000,000 - - - 6,474,138 6,474,138 - 16,474,138 Total Notes: Includes shares held directly, indirectly and beneficially by Key Management Personnel. (1) Mr Nielsen appointed as Director on 24 November 2021 and as CEO on 23 April 2020. (2) The late Mr Balkau ceased as Director on 10 November 2021. - - - 16,474,138 16,474,138 - - - - - - - - - - All equity transactions with key management personnel other than arising from the exercise of remuneration options have been entered into under terms and conditions no more favourable than those the Group would have adopted if dealing at arm’s length. Performance Shares of Key Management Personnel The late Mr J Balkau, prior to his cessation as Director on 10 November 2021 held 38,844,831 Performance Shares as part of the acquisition of Awati Resources Pty Ltd on 6 April 2020. The performance shares entitled the holder to one ordinary share on the announcement of a JORC 2012 compliant resources of at least 500,000 ounces of gold, with a minimum cut-off grade of 0.5 g/t gold and expire on the 6 April 2025. 6. Service Agreements Non-Executive Directors The Non-Executive Directors on appointment, enter into a service agreement with the Company in the form of a letter appointment and are paid an annual fee on a monthly basis. The letter summarises the Board policies and terms, including compensation, relevant to the office of Non-Executive Director. The Non-Executive Directors are also entitled to fees for other amounts as the board determines where they perform special duties or otherwise performs extra services or make special exertions on behalf of the Company. These fees are included as short-term consulting fees as outlined in the tables included in the Remuneration Report. Manhattan Corporation Limited 25 2022 Annual Report to Shareholders DIRECTORS’ REPORT (Continued) In determining whether a Non-Executive Director should perform any additional services on behalf of the Company, the board takes into consideration factors such as the cash flow impact of employing an independent contractor, the relevant experience and technical expertise required in performing any services and relevant additional credentials required to perform a particular task. The aggregate fee remuneration for Non-Executive Directors has been set at an amount not to exceed $200,000 per annum. This amount may only be increased with the approval of Shareholders at a general meeting. Other transactions with Key Management Personnel and their related parties Jura Trust Limited (a Company of which Mr Seton is a director), as trustee of the Jura Trust, charged the Group director’s fees for the twelve months totalling $27,000 (2021: $24,000). This amount is not in addition to the fees included in the remuneration table within this remuneration report. Nil (2021: $Nil) was outstanding at period end. These transactions have been entered into on normal commercial terms. End of Remuneration Report (Audited) Signed on behalf of the board in accordance with a resolution of the Directors. Marcello Cardaci Non-Executive Chairman 29 September 2022 Manhattan Corporation Limited 26 2022 Annual Report to Shareholders AUDITOR’S INDEPENDENCE DECLARATION UNDER SECTION 307C OF THE CORPORATIONS ACT 2001 As lead auditor of the audit of Manhattan Corporation Limited for the year ended 30 June 2022, I declare that, to the best of my knowledge and belief, there have been: • no contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and • no contraventions of any applicable code of professional conduct in relation to the audit. This declaration is in respect of Manhattan Corporation Limited and the entities it controlled during the year. Rothsay Audit & Assurance Pty Ltd Daniel Dalla Director 29 September 2022 CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME Revenue from continuing operations Interest income Expenses Public company costs Consulting and directors’ fees Legal fees Impairment of exploration expenditure Administrative expenses Profit on sale of assets Depreciation Loss before income tax Consolidated Notes 30 June 2022 30 June 2021 $ $ 561 561 1,080 1,080 (64,608) (317,682) (2,803) (39,141) (77,043) - (35,308) (536,024) (77,148) (374,837) (14,096) (32,054) (78,738) 2,727 (25,954) (599,020) Income tax expense 8 - - Net loss for the period (536,024) (599,020) Other comprehensive income for the period - - Total comprehensive loss for the period (536,024) (599,020) Loss per share attributable to owners of Manhattan Corporation Limited Basic and diluted loss per share (cents per share) 7 0.04 0.04 Manhattan Corporation Limited 28 2022 Annual Report to Shareholders CONSOLIDATED STATEMENT OF FINANCIAL POSITION CURRENT ASSETS Cash and cash equivalents Trade and other receivables Consolidated Notes 30 June 2022 30 June 2021 $ $ 10 11 2,175,354 4,220,680 95,635 74,230 TOTAL CURRENT ASSETS 5(b) 2,270,989 4,294,910 NON-CURRENT ASSETS Security deposits Property, plant and equipment Deferred exploration and evaluation expenditure 11 12 13 198,410 112,402 194,350 139,074 5,234,880 3,496,162 TOTAL NON-CURRENT ASSETS 5,545,692 3,829,586 TOTAL ASSETS 7,816,681 8,124,496 CURRENT LIABILITIES Trade and other payables 14 308,684 80,475 TOTAL CURRENT LIABILITIES 308,684 80,475 TOTAL LIABILITIES NET ASSETS EQUITY Issued capital Reserves Accumulated losses TOTAL EQUITY 308,684 80,475 7,507,997 8,044,021 15 16 28,465,911 28,465,911 5,112,350 5,112,350 (26,070,264) (25,534,240) 7,507,997 8,044,021 Manhattan Corporation Limited 29 2022 Annual Report to Shareholders CONSOLIDATED STATEMENT OF CASH FLOWS CASH FLOWS FROM OPERATING ACTIVITIES Payments to suppliers and employees Proceeds from R&D refund Interest received Consolidated Notes 30 June 2022 30 June 2021 $ $ (425,957) (569,480) - 561 - 1,080 NET CASH USED IN OPERATING ACTIVITIES 10 (425,396) (568,400) CASH FLOWS FROM INVESTING ACTIVITIES Payments for fixed asset Receipts for sale of assets Expenditure on exploration (8,636) (165,028) - 2,727 (1,611,294) (2,058,873) NET CASH USED IN INVESTING ACTIVITIES (1,619,930) (2,221,174) CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from issue of shares Share issue costs NET CASH FROM FINANCING ACTIVITIES - - - 6,220,500 (184,527) 6,035,973 Net (decrease) / increase in cash held Cash and cash equivalents at beginning of period (2,045,326) 4,220,680 3,246,399 974,281 CASH AND CASH EQUIVALENTS AT END OF THE PERIOD 10 2,175,354 4,220,680 Manhattan Corporation Limited 30 2022 Annual Report to Shareholders CONSOLIDATED STATEMENT OF CHANGES IN EQUITY Notes Issued capital $ Accumulated payment losses reserves $ $ Total $ Share based At 1 July 2020 Loss for the period Other comprehensive loss Total comprehensive loss Transactions with owners in their capacity as owners 22,429,938 (24,935,220) 5,112,350 2,607,068 - - - (599,020) - (599,020) 6,405,000 (369,027) - - - - - - - (599,020) - (599,020) 6,405,000 (369,027) 15 & 16 28,465,911 (25,534,240) 5,112,350 8,044,021 - - - (536,024) - (536,024) - - - (536,024) - (536,024) Issue of share capital Share issue costs At 1 July 2021 Loss for the period Other comprehensive loss Total comprehensive loss Transactions with owners in their capacity as owners At 30 June 2022 15 & 16 28,465,911 (26,070,264) 5,112,350 7,507,997 Manhattan Corporation Limited 31 2022 Annual Report to Shareholders NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDING 30 JUNE 2022 1. CORPORATE INFORMATION The financial report of Manhattan Corporation Limited (“Manhattan Corporation” or “the Company”) and its controlled entities (“the Group”) for the year ended 30 June 2022 was authorised for issue in accordance with a resolution of the Directors on 29 September 2022. Manhattan Corporation Limited is a for profit company limited by shares incorporated in Australia whose shares are publicly traded on the Australian Securities Exchange. The nature of the operations and the principal activities of the Group are described in the Directors’ Report. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The principal accounting policies adopted in the preparation of the Financial Report are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated. The Financial Statements are for the consolidated entity consisting of Manhattan Corporation Limited and its subsidiaries. The Financial Statements are presented in the Australian currency. Manhattan Corporation Limited is a company limited by shares, domiciled and incorporated in Australia. The financial statements were authorised for issue by the Directors on 29 September 2022. The Directors have the power to amend and reissue the financial statements. (a) Basis of Preparation This general purpose Financial Report has been prepared in accordance with Australian Accounting Standards, other authoritative pronouncements of the Australian Accounting Standards Board, Australian Accounting Interpretations and the Corporations Act 2001. Compliance with IFRS The Financial Statements of Manhattan Corporation Limited also complies with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board. Historical Cost Convention These Financial Statements have been prepared under the historical cost convention. Critical Accounting Estimates The preparation of financial statements requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Group’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the Financial Statements are disclosed in Note 3. Manhattan Corporation Limited 32 2022 Annual Report to Shareholders NOTES TO THE FINANCIAL STATEMENTS (Continued) Going Concern The Company incurred a loss for the year of $536,024 (2021: $599,020) and a net cash outflow from operating activities of $425,396 (2021: $568,400). At 30 June 2022 the Group had cash assets of $2,175,354 (2021: $4,220,680) and working capital of $2,160,715 (2021: $4,408,785). The Directors closely monitor the cash position and note operating costs are less than 25% of the cash balance and that they have the ability to manage discretionary expenditure and commitments as required. The Directors also note their ability in the past to raise capital and that they have support from their investor base if further capital is required and consider it appropriate that the financial report be prepared on a going concern basis. (b) Basis of Consolidation The consolidated Financial Statements incorporate the assets and liabilities of the Company’s wholly owned subsidiaries Manhattan Resources Pty Ltd and Awati Resources Pty Ltd as at 30 June 2022 and the results of the subsidiaries for the year then ended. Subsidiaries are all those entities (including special purpose entities) over which the Group has the power to govern the financial and operating policies, so as to obtain benefits from its activities, generally accompanying a shareholding of more than one-half of the voting rights. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Group controls another entity. The Financial Statements of the subsidiaries are prepared for the same reporting period as the Parent Entity, using consistent accounting policies. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are de-consolidated from the date that control ceases. Intercompany transactions and balances, income and expenses and profits and losses between Group companies, are eliminated. Investments in subsidiaries are accounted for at cost in the Statement of Financial Position of the Company. (c) Segment Reporting Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker. The chief operating decision maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the full Board of Directors. Manhattan Corporation Limited 33 2022 Annual Report to Shareholders NOTES TO THE FINANCIAL STATEMENTS (Continued) (d) Revenue Recognition Revenue is measured at the fair value of the consideration received or receivable. Amounts disclosed as revenue are net of returns, trade allowances, rebates and amounts collected on behalf of third parties. The Group recognises revenue when the amount of revenue can be reliably measured, it is probable that future economic benefits will flow to the entity and specific criteria have been met for each of the Group’s activities as described below. The amount of revenue is not considered to be reliably measurable until all contingencies relating to the sale have been resolved. The Group bases its estimates on historical results, taking into consideration the type of customer, the type of transaction and the specifics of each arrangement. (e) Income Tax The income tax expense or revenue for the period is the tax payable on the current period’s taxable income based on the notional income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to temporary differences and to unused tax losses. Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the Consolidated Financial Statements. However, the deferred income tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting, nor taxable profit or loss. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantively enacted by the year ending 30 June and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled. Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that future taxable amounts will be available to utilise those temporary differences and losses. Deferred tax liabilities and assets are not recognised for temporary differences between the carrying amount and tax bases of investments in controlled entities where the parent entity is able to control the timing of the reversal of the temporary differences and it is probable that the differences will not reverse in the foreseeable future. Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities and when the deferred tax balances relate to the same taxation authority. Current tax assets and tax liabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously. Current and deferred tax balances attributable to amounts recognised directly in equity are also recognised directly in equity. (f) Impairment of Assets For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash inflows which are largely independent of the cash inflows from other assets or company of assets (cash generating units). Non-financial assets other than goodwill that suffered impairment are reviewed for possible reversal of the impairment at each reporting date. Manhattan Corporation Limited 34 2022 Annual Report to Shareholders NOTES TO THE FINANCIAL STATEMENTS (Continued) (g) Acquisition of Assets Assets including exploration interests acquired are initially recorded at their cost of acquisition on the date of acquisition, being the fair value of the consideration provided plus incidental costs directly attributable to the acquisition. When equity instruments are issued as consideration, their market price at the acquisition date is used as fair value, except where the notional price at which they could be placed in the market is a better indication of fair value. Depreciation Depreciable non-current assets are depreciated over their expected economic life using either the straight line or the diminishing value method. Profits and losses on disposal of non-current assets are taken into account in determining the operating loss for the year. The depreciation rate used for each class of assets is as follows: • Motor Vehicles 25% (h) Cash and Cash Equivalents For cash flow statement presentation purposes, cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other short term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value, and bank overdrafts. (i) Exploration and Evaluation Expenditure Exploration, evaluation and development expenditure incurred is accumulated in respect of each identifiable area of interest. These costs are only carried forward to the extent that they are expected to be recouped through the successful development of the area or where activities in the area have not yet reached a stage 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 carry forward costs in relation to that area of interest. (j) Trade and Other Payables These amounts represent liabilities for goods and services provided to the Group prior to the end of Financial Year which are unpaid. The amounts are unsecured and are usually paid within 30 days of recognition. Manhattan Corporation Limited 35 2022 Annual Report to Shareholders NOTES TO THE FINANCIAL STATEMENTS (Continued) (k) Contributed Equity Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds. Incremental costs directly attributable to the issue of new shares or options for the acquisition of a business are not included in the cost of the acquisition as part of the purchase consideration. (l) Investments and Other Financial Assets Financial assets are classified as either financial assets at fair value through profit or loss, or at amortised cost, as appropriate. When financial assets are recognised initially they are measured at fair value, plus, in the case of investments not at fair value through profit or loss, directly attributable transaction costs. The Group determines the classification of its financial assets after initial recognition and, when allowed and appropriate, re-evaluates this designation at each financial year end. Financial Assets at Fair Value Through Profit or Loss A financial asset is classified in this category if acquired principally for the purpose of selling in the short term or if so designated by management. The policy of management is to designate a financial asset at fair value through profit or loss if there exists the possibility it will be sold in the short term and the asset is subject to frequent changes in value. Derivatives are also categorised as held for trading unless they are designated as hedges. Assets in this category are classified as current assets if they are either held for trading or are expected to be realised within twelve months of the year ending 30 June. Amortised Cost Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They arise when the Group provides money, goods or services directly to a debtor with no intention of selling the receivable. They are included in current assets, except for those with maturities greater than twelve months after the year ending 30 June which are classified as non current assets. Loans and receivables are included in receivables in the year ending 30 June. (m) Goods and Services Tax (GST) Revenues, expenses and assets are recognised net of the amount of associated GST, unless the GST incurred is not recoverable from the taxation authority. In this case it is recognised as part of the cost of acquisition of the asset or as part of the expense. Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of GST recoverable from, or payable to, the taxation authority is included with other receivables or payables in the year ending 30 June. Manhattan Corporation Limited 36 2022 Annual Report to Shareholders NOTES TO THE FINANCIAL STATEMENTS (Continued) Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities which are recoverable from, or payable to the taxation authority, are presented as operating cash flows. (n) Employee Benefit Provisions Share-Based Payments The Group provides benefits to employees (including Directors) in the form of share-based payment transactions, whereby employees render services in exchange for shares or options over shares ("equity settled transactions"). The fair value of options granted is recognised as an employee benefit expense with a corresponding increase in equity (share option reserve). The fair value is measured at grant date and recognised over the period during which the employees become unconditionally entitled to the options. Fair value is determined by using a Black and Scholes option pricing model. In determining fair value, no account is taken of any performance conditions other than those related to the share price of Manhattan ("Market Conditions"). (o) Earnings Per Share Basic Earnings Per Share Basic earnings per share is calculated by dividing profit/(loss) attributable to equity holders of the Group, excluding any costs of servicing equity other than ordinary shares, by the weighted average number of ordinary shares outstanding during the Financial Year, adjusted for bonus elements in ordinary shares issued during the year. Diluted Earnings Per Share Diluted earnings per share adjust the figures used in the determination of basic earnings per share to take into account the after income tax effect of interest and other financing costs associated with dilutive potential ordinary shares and the weighted average number of additional ordinary shares that would have been outstanding assuming the conversions of all dilutive potential ordinary shares. (p) New Accounting Standards and Interpretations Standards and Interpretations applicable to 30 June 2022 In the year ended 30 June 2022, the Directors have reviewed all of the new and revised Standards and Interpretations issued by the AASB that are relevant to the Company and effective for the current annual reporting period. As a result of this review, the Directors have determined that there is no material impact of the new and revised Standards and Interpretations on the Group and, therefore, no material change is necessary to Group accounting policies. Standards and Interpretations in issue not yet adopted The Directors have also reviewed all Standards and Interpretations in issue not yet adopted for the year ended 30 June 2022. As a result of this review the Directors have determined that there is no material impact of the Standards and Interpretations on issue not yet adopted on the Company and, therefore, no change is necessary to Group accounting policies. Manhattan Corporation Limited 37 2022 Annual Report to Shareholders NOTES TO THE FINANCIAL STATEMENTS (Continued) 3. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that may have a financial impact on the entity and that are believed to be reasonable under the circumstances. Key Estimates: Impairment of Exploration and Exploration Expenditure The Group assesses impairment at each reporting date by evaluating conditions specific to the Group that may lead to impairment of assets. Where an impairment trigger exists, the recoverable amount of the asset is determined by Value in use calculations performed in assessing recoverable amounts and incorporate a number of key estimates. The Group has made an impairment charge for the year which has been recognised in the profit or loss. Share-Based Payment Transactions The Group measures the cost of equity settled share-based payments at fair value at the grant date using the Black and Scholes model taking into account the exercise price, the term of the option, the impact of dilution, the share price at the grant date, the expected volatility of the underlying share, the expected dividend yield and risk free interest rate for the term of the option. 4. SEGMENT INFORMATION The Group operates in one segment, being mineral resource exploration and assessment of mineral projects. Manhattan Corporation Limited 38 2022 Annual Report to Shareholders NOTES TO THE FINANCIAL STATEMENTS (Continued) 5. FINANCIAL RISK MANAGEMENT The Group’s activities expose it to a variety of financial risks: market risk (including currency risk, interest rate risk and price risk), credit risk and liquidity risk. The Group’s overall risk management program focuses on the unpredictability of the financial markets and seeks to minimise potential adverse effects on the financial performance of the Group. The Group does not use derivative financial instruments, however the Group uses different methods to measure different types of risk to which it is exposed. These methods include sensitivity analysis in the case of interest rate and other price risks and aging analysis for credit risk. Risk management is carried out by the Board of Directors with assistance from suitably qualified external and internal advisors. The Board provides written principles for overall risk management and further policies will evolve commensurate with the evolution and growth of the Group. (a) Market Risk (i) Foreign Exchange Risk The Group does not currently operate internationally and therefore its exposure to foreign exchange risk arising from currency exposures is limited. (ii) Price Risk The Group does not currently hold any equity investments so it is not exposed to equity securities price risk. The Group is not exposed to commodity price risk as the Group is still carrying out exploration. (iii) Cash Flow and Fair Value Interest Rate Risk The Group’s only interest rate risk arises from cash and cash equivalents. Term deposits and current accounts held with variable interest rates expose the Group to cash flow interest rate risk. The Group does not consider this to be material to the Group and have therefore not undertaken any further analysis of risk exposure. (b) Credit Risk Credit risk is managed by the Board for the Group. Credit risk arises from cash and cash equivalents as well as credit exposure including outstanding receivables and committed transactions. All cash balances held at banks are held at internationally recognised institutions, with minimum independently rated rates of ‘A’. The majority of receivables are immaterial to the Group. Given this the credit quality of financial assets that are neither past due or impaired can be assessed by reference to historical information about default rates. Manhattan Corporation Limited 39 2022 Annual Report to Shareholders NOTES TO THE FINANCIAL STATEMENTS (Continued) The maximum exposure to credit risk is the carrying amount of the financial assets of cash and trade and other receivables to the value of $2,469,399 (2021: $4,489,260). The following financial assets of the Group are neither past due or impaired: Cash and cash equivalents Trade and other receivables (c) Liquidity Risk 30 June 2022 30 June 2021 $ 2,175,354 294,045 2,469,399 $ 4,220,680 268,580 4,489,260 Prudent liquidity risk management implies maintaining sufficient cash to meet liabilities. The Group manages liquidity risk by continuously monitoring forecast and actual cash flows and matching the maturity profiles of financial assets and liabilities. As at reporting date the Group had sufficient cash reserves to meet its requirements. The Group therefore had no credit standby facilities or arrangements for further funding in place. The financial liabilities of the Group at reporting date were trade and other payables incurred in the normal course of the business of $308,684 (2021: $80,475). These were non-interest bearing and were due within the normal 30 to 60 days terms of creditor payments. The Group had no borrowings during the year and has therefore not undertaken any further analysis of risk exposure. (d) Fair Value Estimation The fair value of financial assets and liabilities must be estimated for recognition and measurement or for disclosure purposes. The carrying value less any required impairment provision of trade receivables and payables are assumed to approximate their fair values due to their short-term nature. 6. INVESTMENT IN SUBSIDIARIES The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in accordance with the accounting policy described in note 2(b). Equity Holding as Equity Holding as Country of at at Name of Entity Incorporation 30 June 2022 30 June 2021 Manhattan Resources Pty Ltd Awati Resources Pty Ltd (“Awati”) Australia Australia 100% 100% 100% 100% Manhattan Corporation Limited 40 2022 Annual Report to Shareholders NOTES TO THE FINANCIAL STATEMENTS (Continued) 7. LOSS PER SHARE 30 June 2022 30 June 2021 Loss used in calculating basic and dilutive EPS (536,024) (599,020) Weighted average number of ordinary shares used in calculating basic loss per share: 1,526,278,693 1,375,045,816 Number of Shares There is no impact from 214,000,001 options and 300,000,000 performance shares outstanding at 30 June 2022 (2021: 214,000,001 options and 300,000,000 performance shares) on the loss per share calculation because they are anti-dilutive. These options could potentially dilute basic EPS in the future. 8. INCOME TAX EXPENSE (a) Income tax expense Major component of tax expense for the period: Current tax Deferred tax Income tax as reported in the statement of comprehensive income Consolidated 30 June 2022 30 June 2021 $ $ - - - - - - (b) Numerical reconciliation between aggregate tax expense recognised in the statement of comprehensive income and tax expense calculated per the statutory income tax rate. A reconciliation between tax expense and the product of accounting loss before income tax multiplied by the Group’s applicable tax rate is as follows: Loss from continuing operations before income tax expense Tax at the group rate of 25% (2021: 26%) (536,024) (134,006) (599,020) (155,745) Increase in income tax due to: - Non-deductible expenses - Impact of change in corporate tax rate - Changes in unrecognised temporary differences - Unused tax losses not recognised Income tax attributable to operating loss - - (488,773) 622,779 - 213 470,365 (1,039,248) 724,415 - Manhattan Corporation Limited 41 2022 Annual Report to Shareholders NOTES TO THE FINANCIAL STATEMENTS (Continued) Consolidated 30 June 2022 30 June 2021 $ $ (c) Unrecognised deferred tax balances at 25% (2021: 26%) The following deferred tax balances have not been recognised: Deferred tax assets Carry forward revenue and capital losses 6,139,585 5,514,556 Accruals Capital raising costs Deferred tax liabilities Exploration expenditure 5,500 67,464 7,750 94,545 6,212,549 5,616,851 1,133,087 1,133,087 671,395 671,395 The benefit for tax losses will only be obtained if: (i) the Group derives future assessable income in Australia of a nature and of an amount sufficient to enable the benefit from the deductions for the losses to be realised, and the Group continues to comply with the conditions for deductibility imposed by tax legislation in Australia and (ii) (iii) no changes in tax legislation in Australia, adversely affect the Group in realising the benefit from the deductions for the losses. (d) Change in corporate tax rate: There has been a legislated change in the corporate tax rate that will apply to future income years. The impact of this reduction in the corporate tax rate has been reflected in the unrecognised deferred tax positions and the prima face income tax reconciliation above. (e) Tax Consolidation Manhattan Corporation and its wholly owned Australian subsidiaries are part of an income tax consolidated group and have entered into tax sharing and tax funding agreements. Under the terms of these agreements, the subsidiaries will reimburse Manhattan Corporation for any current income tax payable by Manhattan Corporation arising in respect of their activities. The reimbursements are payable at the same time as the associated income tax liability falls due and will therefore be recognised as a current tax-related receivable by Manhattan Corporation when they arise. In the opinion of the Directors, the tax sharing agreement is also a valid agreement under the tax consolidation legislation and limits the joint and several liability of the subsidiaries in the event of a default by Manhattan Corporation. 9. DIVIDENDS PAID OR PROPOSED There were no dividends paid or proposed during the year. Manhattan Corporation Limited 42 2022 Annual Report to Shareholders NOTES TO THE FINANCIAL STATEMENTS (Continued) 10. CASH AND CASH EQUIVALENTS Reconciliation of Cash and Cash Equivalents Cash comprises of: Cash at bank Consolidated 30 June 2022 30 June 2021 $ $ 2,175,354 4,220,680 Cash at bank earns interest at floating rates based on daily bank deposit rates. Short-term deposits are made for varying periods of between one day and three months, depending on the immediate cash requirements of the Group, and earn interest at the respective short-term deposit rates. Reconciliation of operating loss after tax to the cash flows from operations Loss from ordinary activities after tax (536,024) (599,020) Consolidated 30 June 2022 30 June 2021 $ $ Non-cash items Depreciation Sale of fixed assets Exploration expenditure written off Allocation trade and other receivables to exploration Allocation trade and other payables to exploration Change in assets and liabilities Decrease / (increase) in trade and other receivables (Decrease) / increase in trade and other payables Net cash outflow used in operating activities 35,308 - 39,141 22,762 (189,327) (25,465) 228,209 (425,396) 25,954 (2,727) 32,054 112,193 (35,393) (108,710) 7,249 (568,400) Cash at bank and in hand earns interest at floating interest rates based on the daily bank rates. Manhattan Corporation Limited 43 2022 Annual Report to Shareholders NOTES TO THE FINANCIAL STATEMENTS (Continued) 11. TRADE AND OTHER RECEIVABLES (CURRENT / NON-CURRENT) Current GST receivable Other Non-current Security deposits Consolidated 30 June 2022 30 June 2021 $ $ 90,435 5,200 95,635 69,030 5,200 74,230 198,410 194,350 Security deposits are provided for tenements as surety of potential rehabilitation works and have been re- classified as a non-current asset. Other debtors and goods and services tax are non-interest bearing and generally receivable on 30-day terms. They are neither past due nor impaired. The amount is fully collectible. (a) Fair Values and Credit Risk Due to the short-term nature of these receivables the carrying values represent their respective fair values at 30 June 2022. The maximum exposure to credit risk at the reporting date is the carrying amount of each class of receivables mentioned above. Refer to Note 5 for more information on the risk management policy of the Group and the credit quality of the entity’s receivables. (b) Other Receivables These amounts generally arise from transactions outside the usual operating activities of the Group. Collateral is not normally obtained. 12. PROPERTY, PLANT AND EQUIPMENT Motor vehicles Cost Accumulated depreciation Net book amount Motor vehicles reconciliation of carrying amount Carrying amount at beginning of the year Additions Depreciation Carrying amount at the end of the year 2022 $ 2021 $ 173,664 165,028 (61,262) (25,954) 112,402 139,074 139,074 - 8,636 165,028 (35,308) (25,954) 112,402 139,074 Manhattan Corporation Limited 44 2022 Annual Report to Shareholders NOTES TO THE FINANCIAL STATEMENTS (Continued) 13. EXPLORATION AND EVALUATION EXPENDITURE At beginning of the period Exploration expenditure during the period Impairment loss Total exploration and evaluation Consolidated 30 June 2022 30 June 2021 $ 3,496,162 1,777,859 (39,141) $ 1,546,142 1,982,074 (32,054) 5,234,880 3,496,162 The ultimate recoupment of costs carried forward for exploration expenditure is dependent on the successful development and commercial exploitation or sale of the respective mining areas. The impairment loss relates to the withdrawal from tenements held in Australia that the Group has made a decision not to continue exploration and wrote down the carrying value to nil. 14. TRADE AND OTHER PAYABLES (CURRENT) Trade creditors Accruals Other creditors Consolidated 30 June 2022 30 June 2021 $ 261,017 47,667 - 308,684 $ 49,627 31,000 (152) 80,475 Trade payables and other creditors are non-interest bearing and will be settled on 30 to 60-day terms. Due to the short-term nature of these payables, their carrying value is assumed to approximate their fair value. Manhattan Corporation Limited 45 2022 Annual Report to Shareholders NOTES TO THE FINANCIAL STATEMENTS (Continued) 15. ISSUED CAPITAL (a) Issued capital Ordinary shares fully paid Consolidated 30 June 2022 30 June 2021 $ $ 28,465,911 28,465,911 30 June 2022 30 June 2021 Number of shares $ Number of shares $ (b) Movement in shares on issue At beginning of the period 1,526,278,693 28,465,911 1,126,278,693 22,429,938 Issue for cash less fundraising costs - - - - 400,000,000 6,405,000 - (369,027) At 30 June 1,526,278,693 28,465,911 1,526,278,693 28,465,911 (c) Ordinary shares The Group does not have authorised capital nor par value in respect of its issued capital. Ordinary shares have the right to receive dividends as declared and, in the event of a winding up of the Group, to participate in the proceeds from sale of all surplus assets in proportion to the number of and amounts paid up on shares held. Ordinary shares entitle their holder to one vote, either in person or proxy, at a meeting of the Group. (d) Capital risk management The Group’s capital comprises share capital, reserves less accumulated losses amounting to $7,507,997 at 30 June 2022 (2021: $8,044,021). The Group manages its capital to ensure its ability to continue as a going concern and to optimise returns to its shareholders. The Group was ungeared at year end and not subject to any externally imposed capital requirements. Refer to note 5 for further information on the Group’s financial risk management policies. Manhattan Corporation Limited 46 2022 Annual Report to Shareholders NOTES TO THE FINANCIAL STATEMENTS (Continued) (e) Share options At 30 June 2022, there were 514,000,001 unissued ordinary shares under options (30 June 2021: 514,000,001 options). The details of the options and performance shares are as follows: Description Listed Options Listed Options – Awati acquisition Performance shares – Awati acquisition Unlisted incentive options Total Number Exercise Price $ Expiry Date 100,000,001 100,000,000 300,000,000 14,000,000 514,000,001 0.01 0.01 1 August 2023 1 August 2023 Nil 0.01 6 April 2025 28 April 2023 No option holder has any right under the options to participate in any other share issue of the Group or any other entity. No options or performance shares were issued during the year. Information relating to the Manhattan Corporation Employee Share Option Plan, including details of options issued under the plan, is set out in note 21(a). 16. RESERVES Share-based payment reserve Movements in Reserves Share-based payment reserve At beginning of the period At end of period Consolidated 30 June 2022 30 June 2021 $ $ 5,112,350 5,112,350 5,112,350 5,112,350 5,112,350 5,112,350 The share-based payment reserve is used to record the value of equity benefits provided to directors, executives and employees as part of their remuneration and non-employees for their services. Refer to note 21 for further details of the options issued during the period. Manhattan Corporation Limited 47 2022 Annual Report to Shareholders NOTES TO THE FINANCIAL STATEMENTS (Continued) 17. RELATED PARTY TRANSACTIONS (a) Details of key management personnel The following persons were Directors of Manhattan during the Financial Year: Name Position Marcello Cardaci Non-Executive Chairman Kell Nielsen Chief Executive Officer – appointed as Director on 24 November 2021 and John Seton Non-Executive Director as CEO on 23 April 2020. The late Jens Balkau Non-Executive Director – ceased on 10 November 2021 (b) Remuneration of Key Management Personnel Short term employee benefits Total remuneration (c) Loans to Key Management Personnel Consolidated 30 June 2022 30 June 2021 $ 303,000 303,000 $ 296,000 296,000 There were no loans made or outstanding to Directors of Manhattan and Key Management Personnel of the Company, including their personally related parties. (d) Other Transactions with Key Management Personnel (i) Marcello Cardaci Marcello Cardaci is a partner in the firm of Gilbert + Tobin Lawyers. Gilbert + Tobin Lawyers has provided legal services of $2,256 (2021: $12,206) to Manhattan during the year on normal commercial terms. 18. NON-CASH INVESTING AND FINANCING ACTIVITIES There were no non-cash investing or financing activities during the year ended 30 June 2022. 19. SUBSEQUENT EVENTS AFTER END OF FINANCIAL YEAR No matters or circumstance have arisen since 30 June 2022 which significantly affected or could significantly affect the operations of the consolidated group in future financial years. Manhattan Corporation Limited 48 2022 Annual Report to Shareholders NOTES TO THE FINANCIAL STATEMENTS (Continued) 20. AUDITOR’S REMUNERATION Consolidated 30 June 2022 30 June 2021 $ $ The auditor of Manhattan Corporation Limited is Rothsay Audit & Assurance Pty Ltd Amounts received or due and receivable by Rothsay Audit & Assurance Pty Ltd for: - an audit or review of the financial report of the entity and any other entity in the Consolidated group 31,000 34,000 - tax compliance services in relation to the entity and any other entity in the consolidated group - 31,000 - 34,000 21. SHARE BASED PAYMENTS (a) Options All options granted are for ordinary shares in Manhattan Corporation Limited, which confer a right of one ordinary share for every option held. Listed options 1 6 April 2020 1 August 2023 $0.01 $0.0020 Incentive unlisted options 2 28 April 2020 28 April 2023 $0.01 $0.0039 200,000,001 14,000,000 - - - - - - 200,000,001 14,000,000 Grant Date Expiry Date Exercise price Value per security Balance 30 June 2021 Granted Expired Vested Balance 30 June 2022 Notes: 1. Listed options issue formed consideration for the acquisition of Awati Resources Pty Ltd 2. Incentive options were valued using a Black-Scholes option pricing model with the key inputs of the share price at grant date $0.007, risk free rate 0.26% and volatility of 103.13%. Manhattan Corporation Limited 49 2022 Annual Report to Shareholders NOTES TO THE FINANCIAL STATEMENTS (Continued) (b) Acquisition of Exploration Asset – Awati Resources Pty Ltd On 6 April 2020 the acquisition of Awati Resources Pty Ltd was completed with the following consideration. - Consideration Shares – 200,000,000 fully paid ordinary share at a deemed issue price of $0.005 which a subject to a voluntary escrow period of 12 months. - Consideration Listed Options – 50,000,000 listed options with an exercise price of $0.01 expiring on 1 August 2023. The deemed issue price is $0.002. - Advisor Listed Options – 50,000,000 listed options with an exercise price of $0.01 expiring on 1 August 2023. The deemed issue price is $0.002. - Performance Shares – 300,000,000 performance shares, each entitling the holder to one ordinary share on the announcement of a JORC 2012 compliant resources of at least 500,000 ounces of gold, with a minimum cut-off grade of 0.5 g/T gold. Grant Date Expiry Date Share price on grant date Exercise Price Volatility Risk-free rate Value of performance share Performance Shares 6 April 2020 6 April 2025 $0.005 Nil 103.13% 0.41% $0.005 The acquisition of Awati Resources Pty Ltd is not considered to be a business combination under AASB 3 Business Combinations. No value has been attributed to Performance Shares as the value is not recognised until such a time as the Performance Shares vest upon conditions being met. Manhattan Corporation Limited 50 2022 Annual Report to Shareholders NOTES TO THE FINANCIAL STATEMENTS (Continued) 22. PARENT ENTITY INFORMATION The following information related to the parent entity, Manhattan Corporation Limited, at 30 June 2022. The information presented here has been prepared using consistent accounting policies as presented in Note 2. In 2009 Manhattan acquired a 100% interest in Manhattan Resources Pty Ltd and this subsidiary has been consolidated since the acquisition on 21 July 2009 and Awati Resources Pty Ltd from 6 April 2020. Current assets Non-current assets Total Assets Current liabilities Non-current liabilities Total Liabilities Net Assets Issued capital Share based payment reserve Accumulated losses 30 June 2022 30 June 2021 $ 1,886,440 7,289,068 9,175,508 72,687 1,461,655 1,534,342 $ 4,165,700 7,314,504 11,480,204 33,805 3,311,637 3,345,442 7,641,166 8,134,762 28,465,911 5,112,350 28,465,911 5,112,350 (25,937,095) (25,443,499) Total Equity 7,641,166 8,134,762 Loss for the period Other comprehensive income for the period Total comprehensive loss for the period 23. COMMITMENTS (a) Exploration Expenditure Annual tenement rental obligations Annual exploration expenditure commitments (b) Capital or Leasing Commitments There are no capital or leasing commitments as at 30 June 2022. 30 June 2022 30 June 2021 $ $ (493,596) (514,236) - - (493,596) (514,236) 30 June 2022 30 June 2021 $ 70,074 633,500 703,574 $ 27,180 517,000 544,180 Manhattan Corporation Limited 51 2022 Annual Report to Shareholders NOTES TO THE FINANCIAL STATEMENTS (Continued) 24. CONTINGENT LIABILITIES AND CONTINGENT ASSETS The Directors are of the opinion that there are no contingent liabilities or contingent assets as at 30 June 2022. 25. INTERESTS IN JOINT VENTURES Manhattan currently has no Joint Venture interests. Manhattan Corporation Limited 52 2022 Annual Report to Shareholders DIRECTORS’ DECLARATION In the opinion of the Directors of Manhattan Corporation Limited (“Manhattan”): (a) The Financial Statements comprising the Consolidated Statements of Comprehensive Income, Financial Position, Cash Flows, Statement of Changes in Equity and the Notes to Accompany the Financial Statements as set out on pages 32 to 52 are in accordance with the Corporations Act 2001, and: (i) comply with Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reporting requirements; and (ii) give a true and fair view of the financial position of Manhattan as at 30 June 2022 and of its performance for the Financial Year ended on that date. (b) In the Directors’ opinion, there are reasonable grounds to believe that Manhattan will be able to pay its debts as and when they become due and payable; (c) The remuneration disclosures included in the Directors’ Report (as part of the Audited Remuneration Report), for the year ended 30 June 2022, comply with section 300A of the Corporations Act 2001; (d) A statement that the attached Financial Statements are in compliance with International Financial Reporting Standards has been included in the Notes to the Financial Statements; and (e) The Directors have been given the declarations required by section 295A of the Corporations Act 2001 from the Chief Executive and Chief Financial Officers for the Financial Year ended 30 June 2022. This declaration is made in accordance with a resolution of the Board of Directors and is signed on behalf of the Directors by: Marcello Cardaci Non-Executive Chairman 29 September 2022 Manhattan Corporation Limited 53 2022 Annual Report to Shareholders INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF MANHATTAN CORPORATION LIMITED Report on the Audit of the Financial Report Opinion We have audited the financial report of Manhattan Corporation Limited (“the Company”) and its controlled entities (“the Group”) which comprises the consolidated statement of financial position as at 30 June 2022, the consolidated statement of profit or loss and other comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year then ended on that date and notes to the financial statements, including a summary of significant accounting policies and the directors’ declaration of the Company. In our opinion, the financial report of the Group is in accordance with the Corporations Act 2001, including: (i) giving a true and fair view of the Group’s financial position as at 30 June 2022 and of its financial performance for the year ended on that date; and (ii) complying with Australian Accounting Standards and the Corporations Regulations 2001. Basis for Opinion We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under these standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Report section of this 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 (Including Independence Standards) (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. Key Audit Matters Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial report of the current period. These matters were addressed in the context of our audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF MANHATTAN CORPORATION LIMITED (continued) Key Audit Matter – Going Concern How our Audit Addressed the Key Audit Matter The financial statements have been prepared on a going concern basis. We note that the Group has a cash balance of $2.2 million, current assets of $2.3 million, current liabilities of $0.3 million and generated a loss of $0.5 million and cash outflows of $2.0 million. Going concern was therefore considered a key audit matter. Our procedures included: • • • Review of management’s assessment of going concern; Review of budgets and results subsequent to year end; and Assessing the appropriateness of the related disclosures in the financial report. Key Audit Matter – Impairment of Assets How our Audit Addressed the Key Audit Matter The Group has significant capitalised exploration and evaluation expenditure of $5,234,880, comprising 64% of the total assets of the Group. Our procedures in reviewing the need for impairment of the exploration and evaluation assets included but were not limited to the following: is subject to a significant We note that assessment for impairment of these assets level of judgement. Management reviewed capitalised exploration and evaluation expenditure for any indicators of impairment in accordance with AASB 6 Exploration for and Evaluation of Mineral Resources. • • the reasonableness of Reviewing the management’s assessment of the indicators of impairment; and Reviewing the compliance of management’s assessment with AASB 6. We have also assessed the appropriateness of the disclosures included in the financial report. Other Information The directors are responsible for the other information. The other information comprises the information included in the Group’s annual report for the year ended 30 June 2022, 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 there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF MANHATTAN CORPORATION LIMITED (continued) Directors’ Responsibility 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 the 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 cease operations, or have no realistic alternative but to do so. Auditor’s Responsibility 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 Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of this financial report. A further description of our responsibilities for the audit of the financial report is located at the Auditing and Assurance Standards Board website at: www.auasb.gov.au/Home.aspx. We communicate with the directors regarding, amongst 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 those 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 communications. INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF MANHATTAN CORPORATION LIMITED (continued) Report on the Remuneration Report Opinion on the Remuneration Report We have audited the remuneration report included in the directors’ report for the year ended 30 June 2022. In our opinion the remuneration report of Manhattan Corporation Limited for the year ended 30 June 2022 complies with section 300A of the Corporations Act 2001. Responsibilities The directors of the Company are responsible for the preparation and presentation of the Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards. Rothsay Audit & Assurance Pty Ltd Daniel Dalla Director Dated 29 September 2022 ASX ADDITIONAL INFORMATION ASX Additional Information Additional information required by the Australian Stock Exchange Ltd and not shown elsewhere in this report is as follows. The information is current at 23 September 2022. Substantial Holders Substantial holders in the Company are set out below: Ordinary Shares UBS Nominees Pty Ltd Distribution of Share Holders 1 - 1,000 1,001 - 5,000 5,001 - 10,000 10,001 - 100,000 100,001 and over TOTAL Ordinary Shares Number of Holders Number of Shares 86 120 87 917 1,126 2,336 34,775 354,458 755,200 48,390,668 1,476,743,592 1,526,278,693 Number held % Units 83,061,000 5.44 There were 952 holders of ordinary shares holding less than a marketable parcel. Top Twenty Share Holders Rank Name 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 UBS Nominees Pty Ltd Citicorp Nominees Pty Limited J & J Bandy Nominees Pty Ltd Mr Noel Ross Archer Australian Leisure Equity Pty Ltd Jet Capital Pty Ltd Mr Malcolm Alexander Briody HSBC Custody Nominees (Australia) Limited Argonaut Equity Partners Pty Ltd Mr Jason Bontempo & Mrs Tiziana Battista DJ Coughlan Drilling Pty Ltd Motte & Bailey Pty Ltd NEWD Corp Pty Ltd RWH Nominees Pty Ltd Well Forever Pty Ltd Mr Clive James Currie BR Corporation Pty Ltd Generation Four Investments Pty Ltd Well Profits Pty Ltd DNP Paribas Nominees Pty Ltd Units % Units 83,061,000 42,616,709 40,264,389 35,106,291 33,196,141 27,463,558 25,000,000 24,461,665 20,000,474 20,000,000 20,000,000 16,000,000 16,000,000 15,959,849 15,083,121 12,006,546 12,000,000 11,850,283 11,538,888 11,375,196 5.44 2.79 2.64 2.30 2.17 1.80 1.64 1.60 1.31 1.31 1.31 1.05 1.05 1.05 0.99 0.79 0.79 0.78 0.76 0.75 Totals: Top 20 holders of ORDINARY FULLY PAID SHARES (Total) Total Remaining Holders Balance 492,984,110 1,033,294,583 32.30 67.70 Manhattan Corporation Limited 58 2022 Annual Report to Shareholders ASX ADDITIONAL INFORMATION (Continued) Top Twenty Option Holders Rank Name 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Mr Jason Bontempo & Mrs Tiziana Battista Lamerton Pty Ltd Jet Capital Pty Ltd Jorac Pty Ltd Ausdrill International Pty Ltd Ratdog Pty Ltd Argonaut Equity Partners Pty Ltd Mr Noel Ross Archer Aralad Management Pty Ltd Konkera Pty Ltd Mr Michael & Mrs Rachel Henderson The Little Big Company Pty Ltd Mr Thomas Preston Niquet Olden Argonaut Investments Pty Ltd Mr Mark Willian Kirk Mrs Janice Elaine Chisholm Mr Michael Grant Henderson & Mrs Rachel Maree Henderson Kembla No 10 Pty Ltd Wilhaja Pty Limited Mr George Andrew Bourdis & Mrs Maria Bourdis Totals: Top 20 holders of LISTED OPTIONS EXPIRING 01/08/2023 @ $0.01 (Total) Total Remaining Holders Balance Restricted Securities There are no restricted securities. On-Market Buy Back There is no current on-market buy back. Voting Rights All ordinary shares carry one vote per share without restriction. Units % Units 43,819,600 25,000,000 20,000,000 14,610,284 10,946,462 7,500,000 6,500,000 5,476,572 5,000,000 5,000,000 4,000,000 4,000,000 3,600,000 2,103,250 2,100,000 2,000,000 2,000,000 2,000,000 2,000,000 1,966,247 21.91 12.50 10.00 7.31 5.47 3.75 3.25 2.74 2.50 2.50 2.00 2.00 1.80 1.05 1.05 1.00 1.00 1.00 1.00 0.98 169,622,415 30,377,586 84.81 15.19 Manhattan Corporation Limited 59 2022 Annual Report to Shareholders ASX ADDITIONAL INFORMATION (Continued) Interests in Tenements Held Project Ponton Northern Licences Southern Licenses Tenement Number E28/1898 E28/2454 Tenure Title Holder 1 Manhattan Manhattan EL 9202 EL 7437 EL 8691 EL 8688 EL 8602 EL 8603 EL 8607 EL 8689 EL 8690 EL 8742 EL 9010 EL 9024 EL 9092 EL 9093 EL 9094 Awati Awati Awati Awati Awati Awati Awati Awati Awati Awati Awati Awati Awati Awati Awati Interest % Status of Tenure 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 22 Sub blocks surrendered Granted Granted Granted Granted Granted Granted Granted Granted Granted Granted Granted Granted Granted Granted Granted Note (1): The registered holder of the tenements are Manhattan Corporation Limited (“Manhattan”) and Awati Resources Pty Ltd (“Awati”). Manhattan Corporation Limited 60 2022 Annual Report to Shareholders 

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