Manuka Resources Ltd ABN 80 611 963 225
A N N U A L R E P O R T 2 0 2 2
Annual Report
For the year ended 30 June 2022
Manuka Resources Ltd
ABN 80 611 963 225
Manuka Resources Ltd
For the year ended 30 June 2022
1
CORPORATE DIRECTORY
Directors
Dennis Karp – Executive Chairman
Nick Lindsay – Non-Executive Director
Lawyers
K&L Gates
Level 31, 1 O’Connell Street
Sydney NSW 2000
Anthony McPaul – Non-Executive
Director
Key Management
Haydn Lynch – Chief Operating Officer
Company Secretary
Toni Gilholme
Registered Office
Level 4, Grafton Bond Building
201 Kent Street
Sydney NSW 2000
www.manukaresources.com.au
Auditor
Ernst & Young
200 George Street
Sydney NSW 2000
Share Registry
Automic Group Pty Ltd
Level 5, 126 Phillip Street
Sydney NSW 2000
Stock Exchange Listing
Manuka Resources Limited shares (Code:
MKR) are listed on the Australian
Securities Exchange.
Manuka Resources Ltd
For the year ended 30 June 2022
Contents
Executive Chairman’s Report
Review of Operations
Mineral Resources Statements
Directors’ Report
Auditor’s Independence Declaration
Consolidated Statement of Profit or Loss and Other Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Notes to the Financial Statements
Directors’ Declaration
Independent Auditor’s Report
ASX Additional Information
2
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Manuka Resources Ltd
For the year ended 30 June 2022
3
Executive Chairman’s Report
Transitioning from gold to silver production, and securing the future
This annual report marks our second year as a resources company listed on the ASX.
As most readers of this report may be aware, Manuka recommenced processing operations at its 100% owned
Wonawinta plant on stockpiled Mt Boppy gold ores in April 2020. In June 2020 we began mining at Mt Boppy
and continued to do so until 30 November 2021, with processing of the gold ores continuing until March 2022.
The actual end-date was a month premature due to a significant weather event triggering an inflow of water
into the pit. A direct impact of this significant weather event was that we had just completed a drill and blast
at our RL170 level, and that ore remains in the pit (together with some residual material from the RL175 drill
and blast). This equates to ~4000oz gold which would have been a good boost for cash flows at the time, but
now gives us a running start when we elect to recommence mining at Mt Boppy.
It has long been our plan to conclude our phase 1 of gold production by the end of 2021. This was to provide
us with the opportunity of updating our Mineral Resource Summary, and commercially assess the mining
options available to us in what had become a narrow open-pit requiring a cut-back prior to further mining.
This assessment is now underway, as our Resource Summary (released through the ASX on 29-7-22)
demonstrates 45,000oz gold remaining in-pit at an average grade of 4.95g/t gold. As at the end of phase 1
gold production we had recovered and sold ~41,000 ounces of gold (a positive outcome when compared to
our pre-IPO estimate of 22,000-24,000 ounces).
Gold ore processing operations at the Wonawinta plant continued until early March, following which time the
transition from gold to silver processing took place. It is important to note that it was silver which drove the
initial construction of Wonawinta back in 2012. Manuka’s recommissioning of the silver circuit started in April
2022 on a 515,000t stockpile sitting alongside the pit, (and forecast to produce ~900,000oz silver). Internally
at Manuka we have deemed the stockpile processing as a trial program, intended to ensure we fully
understand the nature of our Wonawinta silver ores and providing notice of any as yet unforeseen
metallurgical challenge which may present itself. To date we have spent more than A$1.25m on the
metallurgical recoveries of our ore, and we look forward to the work undertaken in laboratories replicating
itself in the plant, prior to embarking on mining our ~50 million oz silver resource (which is subject to a
commercially viable mine plan).
It has been fascinating to note the existence of background gold accompanying all our Wonawinta silver
recoveries from the stockpiles to date. Our exploration results to date have not uncovered any material levels
of gold within the tenements comprising the Wonawinta mining lease and will be revisited during calendar
2023.
Three of our key corporate objectives over the past 12 months were the following;
a. To complete the phase 1 mining at Mt Boppy
b. To commence silver production through the Wonawinta plant
c. To repay the outstanding debt to our secured lenders of USD$10m
While the first two points were achieved, we were unable to repay the outstanding debt to our secured lenders
in full. Principal payments were made during the financial year, and these reduced the balance to USD$8m.
However, the November water event at Mt Boppy effectively shut the chance of a full repayment from
occurring.
Manuka Resources Ltd
For the year ended 30 June 2022
4
Part of the role of a board of directors is to ensure the survival and future growth of the company they serve.
While this role may involve many considerations, it became clear to the Manuka board that a key risk the
company faced, was its reliance on precious metals. This has been reinforced over the period where we have
seen external factors that historically would have led to substantial increases in the price of both gold and
silver, have little effect on either (or as has been the case with silver over the past 6 months, resulted in a 30%
fall in price).
Manuka considered a number of commercial opportunities, but the South Taranaki Bight (“STB”) project was
far and away the most commercially enticing. We entered into a binding term sheet which was announced to
the market through the ASX on 1 August 2022, and at time of writing have secured Manuka shareholder
approval for the acquisition. The STB project was issued its mining licence in 2014 for the mining of 5.0 million
t.p.a. over a 20 year period. In terms of its sheer commercial potential, this project presents Manuka with the
unique opportunity of securing a stronghold in vanadium production, a commodity which has been declared
a critical mineral by the USA, the EU and Australia, and is proving essential for utility or grid storage within the
green energy fuelled global economy. Furthermore, the STB project will quite possibly be the lowest carbon
emitter per tonne of ore produced of any iron ore producer.
I am also pleased to include our first update on our Sustainability journey which follows a little further within
this Financial Report. The board of Manuka understands that being recognised for sustainable performance is
a longer journey but sees the adoption of a Sustainability Statement as a strong signal of our intent, and our
commitment to fulfil our ESG obligations. The Board has approved a number of actions and the Board Charter
has been amended accordingly. We are in the process of reviewing and updating all our polices targeting
activities which may have environmental and social impacts. We have published our Sustainability Statement,
highlighting our priorities and commitments, including a commitment to align to the United Nations’ SDG’s
(Sustainable Development Goals).
Our disclosure reporting will align with the internationally recognised GRI (Global Reporting Initiative)
Reporting Principles and Standards. To support our reporting and disclosure activities over the next reporting
period, we have commenced using a mining-sector specific, sustainability reporting platform.
Finally, we will be refreshing our website to highlight our sustainability commitments and improve the visibility
of our actions and impact.
In closing, I would like to thank the entire team at Manuka Resources. The past year has again presented us
with a number of challenges, as you all worked tirelessly to grow the Company. We no longer use the term
‘abnormal weather’ on site, as severe weather conditions have now been far too consistent to warrant such a
label. When I reflect back to 2016, when we first purchased the Wonawinta Project, I remember being told
when asking about the weather that ‘it never rains in Cobar’, if only!
In closing, I would like to add how proud I am of all within Manuka, and specifically acknowledge the role
played by our Operations Manager, David Power, and his team.
Thank you to our two Non-Executive Directors Tony McPaul and Nick Lindsay, to Haydn Lynch, our Chief
Operating Officer, and Toni Gilholme our Company Secretary for all their work during the financial year. Also
thank you to our shareholders for your support during the period.
Dennis Karp
Chairman
Manuka Resources Ltd
For the year ended 30 June 2022
5
Review of Operations
COMPANY PROFILE AND OPERATIONAL OVERVIEW
Manuka Resources Ltd (“Manuka” or “the Company”) successfully completed Phase 1 of its mining operations
at its Mt Boppy gold mine during the year and commenced a trial of processing silver ore stockpiles from its
Wonawinta site through the Company’s plant located at Wonawinta. The Company has been able to employ
a significant percentage of its workforce including contractors from the Central Western region of NSW as part
of its concerted effort to benefit the local community as much as possible.
Activities (excluding mining) at Mt Boppy have focused on identifying additional resources beneath the
planned pit floor contemporaneously with a complete exploration review of targets and initial drill activity on
the surrounding exploration licence. A geophysical survey (VTEM) has been designed for EL5842 and will be
flown in due course.
The major focus (excluding processing) at the Wonawinta site has been on completing the first phase of a
ground gravity survey over Wonawinta mining lease areas.
BACKGROUND
Manuka Resources Limited (ASX: MKR) is an Australian mining and exploration company located in the Cobar
Basin, central west New South Wales. It is the 100% owner of two fully permitted mining projects, one gold
and one silver, both within the Cobar Basin, which include the following:
• Mt Boppy Gold mine and neighbouring tenements. Operations at the Mt Boppy project are currently
suspended, as the Company awaits an updated mine plan.
• Wonawinta silver project, with mine, processing plant and neighbouring tenements. The Wonawinta
processing plant has a nameplate capacity of 850,000 tonnes per year, and recommenced silver
production in March 2022.
• Highly prospective exploration targets on its ~1150km2 tenement portfolio in the Cobar Basin
Manuka has also entered into a binding term sheet to purchase Trans-Tasman Resources Limited, owners of
the South Taranaki Bight VTM (vanadiferous titanomagnetite) project.
Manuka Resources Ltd
For the year ended 30 June 2022
6
THE MT BOPPY GOLD PROJECT
Operations
Following a comprehensive refurbishment of its Wonawinta plant during the 2020 financial reporting period,
and a lift in its tailings storage facility, Manuka Resources Limited commenced production at its 100% owned
Mt Boppy gold project in April 2020. The Company successfully completed its first Phase of gold production
in February 2022. The key performance measures (as detailed below) from Phase 1 gold at Mt Boppy exceeded
prospectus forecasts on all key metrics1.
Summary of Project Performance
Prospectus Forecast
2020
Project Actuals
Apr 2020 – Feb 2022
Ore Milled (tonnes)
Feed Grade (gram per tonne)
Recovery %
Gold Production (ounces)
Gross Metal Sales Revenue
320,000
3.00
75%
22-24,000
$55-60m
560,430
3.02
75.3%
40,942
>$100m
Tenements
The Mt Boppy Gold Project (which comprises 3 granted mining leases, 4 gold leases, and one exploration
licence (which together cover an area in excess of approximately 210 km2)) is located approximately 46 km
east of Cobar, on the eastern side of the highly prospective and metalliferous Cobar Basin. The Company owns
(via its wholly owned subsidiary, Mt Boppy Resources P/L) 100% of the interests in the tenements detailed in
the following table:
Tenement
Grant Date
Renewal Date
Expiry Date
Area (km2)
GL3255
GL5836
GL5848
GL5898
ML311
ML1681
MPL240
EL5842
20-May-1926
08-Jul-2014
20-May-2033
15-Jun-1965
08-Jul-2014
15-Jun-2033
15-Feb-1968
08-Jul-2014
15-Jun-2033
21-Jun-1972
08-Jul-2014
12-Dec-2033
8.30
6.05
8.62
7.50
08-Dec-1976
08-Jul-2014
12-Dec-2033
10.12
12-Dec-2012
12-Dec-2012
12-Dec-2033
188.10
17-Jan-1986
08-Jul-2014
12-Dec-2033
17.80
19-Apr-2001
3-Aug-2022
19-Apr-2026
210 km2
(Table 1 – Tenements Mt Boppy)
1 Refer ASX release dated 4 March 2022
Manuka Resources Ltd
For the year ended 30 June 2022
7
Regional Geology
Mount Boppy is hosted within Devonian-age sedimentary and volcanic rocks of the Canbelego-Mineral Hill Rift
Zone. Mineralisation occurs largely in brecciated and silicified fine-grained sediments of the Baledmund
Formation, within and adjacent to a faulted contact with older Girilambone Group sedimentary rocks. Lodes
strike approximately north-south and dip steeply west, although the widest zone of mineralisation is related
to slightly shallower dips. Gold mineralisation is fine-grained and commonly associated with coarse grained
iron rich sphalerite. Section 7.2 of the Independent Technical Report discusses the local geology of the project
area2.
(Figure 2 - Tenements - Mt Boppy Gold Project)
2 See Prospectus dated 22 May 2020, released to the ASX platform on 10 July 2020
Manuka Resources Ltd
For the year ended 30 June 2022
8
THE WONAWINTA SILVER PROJECT
The Company holds title to the pastoral lease for the grazing property called “Manuka”, upon part of which
the Wonawinta Silver Project is located. The Manuka pastoral lease is connected to the low voltage rural power
network and contains useful infrastructure namely a homestead, internet satellite connection and airstrip.
(Figure 3 - Tenements of Wonawinta Silver Project)
Operations
The Company transitioned to silver production in late March 20223 Contract crushing commenced with a two
stage circuit consisting of a jaw and cone crusher in combination with screens. Minor modifications were made
to the plant in several areas including pump upgrades, reconfiguration of diesel gen sets and re-commissioning
of the original silver elution circuit which incorporates a 10 tonne carbon column. During the gold phase of
processing this circuit was bypassed with a Gekko-Cadia modular elution circuit. The precious metal room was
also modified with additional fume extraction and oven enclosures.
The June 2022 quarter marked the Company’s first full quarter of silver production and no contribution from
mining Mt Boppy gold ores. The silver production ramp-up has not been without its challenges. Chief among
them was the sufficient feedstock for processing, and balanced plant operations which were not forthcoming.
Persistent wet weather has made handling this material, which has a high clay content, challenging and
additional procedures and further front end modifications have been incorporated to assist its processing. In
amongst our plant operational issues, our contractors encountered equipment supply issues, a COVID-19 wave
3 Refer ASX release dated 1 June 2022
Manuka Resources Ltd
For the year ended 30 June 2022
9
through their workforce, and the general staffing challenges confronting most mining related companies at
present.
Considerable metallurgical test work was spent over the preceding 18 months to optimise the stockpile
processing. The preferred solution identified was the incorporation of a second silver recovery circuit
specifically targeting the washing out of the clays and the treatment of the finer grained but high-grading ores
which remained. This ‘deslimer circuit’ has been a source of delay since commencement of stock-pile
processing in March. There are approximately 125,000 ounces of fines crushed and awaiting processing
through the deslimer and now scheduled to commence end-September. Around 500,000 ounces of silver are
budgeted for recovery in the last quarter of 2022, together with gold of 1000oz remaining in the stockpile.
Internally, the silver stockpile processing has been viewed as a trial program, intended to complete our
understanding of any challenges likely to arise from mining and processing the broader 50 million ounce silver
resource within the mining lease at Wonawinta. Understanding and confirming the likely recoveries from
material processed through the deslimer will be the final piece in this puzzle.
Tenements
The Company directly owns 100% of the interests in the Tenements detailed in the following table:
Tenement
Grant Date
Renewal Date
Expiry Date
Area (km2)
ML1659
23-Nov-11
23-Nov-2011
23-Nov-32
EL6482
EL7345
EL6155
EL6302
EL7515
EL6623
EL8498
18-Nov-05
27-Jan-2022
18-Nov-26
25-May-09
28-Jul-2022
25-May-28
17-Nov-03
23-Jan-2022
17-Nov-26
23-Sep-04
10-Dec-2021
23-Sep-26
7-Apr-10
9-Jun-2022
7-Apr-27
31-Aug-06
20-Jun-2019
31-Aug-23
10-Jan-17
3 –Nov-2021
10-Jan-24
9.24
268.21
169.18
10.54
280.02
14.53
26.24
114
Regional Geology
(Table 2 – Tenements Wonawinta)
The Cobar Basin is located in central-west New South Wales, approximately 700 km north-west of Sydney. It
is a complex metallogenic system containing numerous mineral deposits. “Cobar-style” mineral deposits
comprise a unique class of large and commonly high-grade base and precious metal deposits hosted by marine
sediments. They typically have great vertical extent but only a small surface footprint.
Manuka Resources Ltd
For the year ended 30 June 2022
10
(Figure 4 – Existing mine infrastructure and resource outline in ML 1659)
Manuka Resources Ltd
For the year ended 30 June 2022
11
STRATEGY AND DEVELOPMENT PLANS
The first phase of open cut production at the Mt Boppy gold mine successfully concluded at the end of Q1
2022.
Operations transitioned to a trial phase of silver stockpile processing at the Wonawinta silver project during
Q2. During this trial phase the Company will obtain valuable processing and metallurgical data which will
better inform mine planning for the oxide silver resource at Wonawinta. This data will include an evaluation
of optimal ore handling in the comminution circuit and whether ore feeds should be segregated into discrete
particle fractions before being feed into the ball mill. These trials will determine if finer sizings should bypass
the primary ball mill and be set straight to the leach circuit via the secondary mill. Recent operating
performance has shown a significant distribution of high-grade silver species in the finer fractions of the ore.
These results are expected to have a material result on the overall metallurgical recoveries of the various
lithologies in the ore on the stockpiles and hence representative of the insitu oxide resource of the project.
The company also continues to evaluate proximal and near-term silver, base metals processing opportunities
which take advantage of the strategic location of the Wonawinta processing plant in the southern Cobar Basin.
This includes the potential reconfiguration of the existing flowsheet to process sulphide ore through a flotation
circuit. The Mt Boppy gold mine is also undergoing evaluation for a second phase of open cut mining to
extract the current gold resource. This would involve a cut back on the western wall of the pit and require
updated geotechnical assessment before mine plans could be finalised. Initial pit optimisations are being
progressed and mine planning continues to ascertain if current market conditions are conducive to
development of an economic silver project at this point in time.
Exploration Strategy and Overview
The Company’s exploration strategy to date has focussed on near mine targets at both Mt Boppy and
Wonawinta in an effort to develop resources close to existing operations. Activities at Mt Boppy centred on
drilling the gold resource beneath the pit and further drill programs near/beneath the pit once dewatering has
commenced as current water levels in the pit create drill sample recovery problems due to hydrostatic
pressure. Partially completed drill programs were conducted at the Racecourse and Bullseye prospects but
could not be drilled to planned target depths and will be re-assessed later in 2022.
A ground gravity survey was conducted on the Wonawinta mining lease in early 2022, this has been planned
in three phases of which this survey was the first. The first phase of this program has better defined the extent
of the sulphide system which was drill tested by the Company in 20214. Additional drill targets have been
planned on the ML with the intention to complete these holes in Q4 2022.
4 Refer ASX release on Wonawinta Deeps dated 9 February 2021
Manuka Resources Ltd
For the year ended 30 June 2022
12
(Figure 5 – Staged Ground Gravity Survey 2022)
To the north of Wonawinta targets on EL6302 (site of the historic 3g/t McKinnons gold mine) and EL8498 were
developed (displayed on plan below) to be drilled as weather conditions allow. These targets are favoured for
gold and base metals.
Manuka Resources Ltd
For the year ended 30 June 2022
13
(Figure 6 – Exploration targets on Northern Leases)
Precious metals targets on Exploration Licences
The exploration lease surrounding the Mt Boppy mine at Canbelego (EL5842) is slated for a comprehensive
helicopter VTEM survey over approximately 2,200-line kms. This survey will complete a large number of
information gaps due to irregular historic surveys on the tenement. Once the data has been processed it is
expected a large number of drill targets for both gold and base metals will be able to be confirmed for the next
drilling season. Weather has been the main impediment to mobilisation of drill rigs over the past 12 months.
Central West NSW has experienced two wet years in succession making wheeled vehicle access difficult due
to frequent bogging. Even the use of a tracked rig does not completely resolve the situation as support and
geological crews use wheeled vehicles.
Manuka Resources Ltd
For the year ended 30 June 2022
14
(Figure 7 – Helicopter VTEM Area EL5842)
South Taranaki Bight Project
Manuka entered into a Binding Term Sheet for the purchase (subject to Manuka shareholder approval) of
emerging vanadiferous titanomagnetite iron sands producer Trans-Tasman Resources Limited on 1st August
20225. Manuka will acquire 100% of TTR for the issue of between 170-180 million new Manuka shares.
TTR is a New Zealand incorporated company that owns Mineral Mining Permit 55581 and Mineral Exploration
Permit 54068 situated in the South Taranaki Bight off the west coast of the North Island of New Zealand on
which a Bankable Feasibility Study (BFS) for an offshore iron sands project has commenced (STB Project).
Manuka’s vision is for a project initially recovering approximately 5 million tonnes of vanadiferous
titanomagnetite (VTM) iron ore concentrate per annum over a 20 year mine life6.
5 Refer ASX release dated 1 August 2022
6 Refer ASX release dated 1 August 2022
Manuka Resources Ltd
For the year ended 30 June 2022
15
A general meeting of shareholders was called under a notice of meeting distributed to shareholders on 22nd
August 20227. At the General Meeting which was held on 21st September 2022 shareholders approved the
issue of Manuka shares to TTR shareholders8. Shares will be issued at Completion of the acquisition which is
expected in early November 2022.
The South Taranaki Bight extends into an EEZ (exclusive economic zone) controlled by New Zealand. Within
the EEZ there exists 3 operating oil and gas platforms, while other commercial operations await operating
approval. The STB Project was granted a mining licence in 2014 and received EPA environmental consents to
operate in 2017. It is now awaiting its final EPA operating consent (following Supreme Court and High Court
rulings) a process which is understood to be procedural.
7 Refer ASX release dated 22 August 2022
8 Refer ASX release dated 21 September 2022
Manuka Resources Ltd
For the year ended 30 June 2022
16
Mineral Resources Statements
Mining operations ceased at Mt Boppy in November 2021 and at 30th June 2022, the JORC 2012 categorised
Resources have been updated. The updated Mt Boppy resource was released 29th July 20229. JORC
categorised Mineral Resources for Wonawinta were released to the ASX on 1 April 2021.
Mt Boppy Resource Statement
The total remaining Resource as at 30 June 2022 is 281,850 tonnes at a grade of 4.95 g/t Au for 44,820 ounces.
The mineral resource estimate for Mt Boppy is reported within a pit shell that reaches a depth of 215m below
surface at the southern end of the deposit. Resources are reported with respect to the current pit design.
Material within the pit design is reported at a 1.6 g/t cut off and material below the pit design is reported to a
3.0 g/t cut off.
Resource Category
Tonnes
Grade
g/t Au
Measured
Indicated
Inferred
Total
106,850
158,000
17,000
281,850
Contained gold
Troy ounces
18,020
24,700
2,100
44,820
5.25
4.85
3.93
4.95
(Table 3 - Mt Boppy Gold Resource at 30 June 2022)
The Mt Boppy Resource reported in the previous year as at 30 June 2021 is reproduced below.
Resource Category
Tonnes
Grade
g/t Au
Measured
Indicated
Inferred
Total
159,470
175,700
4,000
339,170
Contained gold
Troy ounces
23,800
25,100
1,000
49,900
4.64
4.44
5.70
4.58
(Table 4 – Mt Boppy Gold Resource at 30th June 2021)
The changes arise from a combination of mining depletion over the past year and additional resource drilling
completed over the same period10. The majority of this additional resource is beneath the existing pit floor
and further drilling may be undertaken in the future.
Wonawinta Mineral Resources Statement
The JORC (2012) Mineral Resource Estimate is unchanged over the past 12 months as no additional infill drilling
was completed on the Wonawinta resource and no changes have been made to the resource model. The
original estimate was released to the ASX on 1 April 2021. The total resources is 38.3 million tonnes at 41.3
g/t Ag and 0.54% Pb providing 50.94 million ounces of silver and 207.2 thousand tonnes of lead.
9 Refer ASX release dated 29 July 2022
10 Refer ASX release dated 28 March 2022
Manuka Resources Ltd
For the year ended 30 June 2022
Resource
Category
Measured
Indicated
Inferred
Total
Material
(Mt)
1.1
12.3
24.9
38.3
Ag (g/t)
Ag Moz
Pb (%)
47.3
45.5
39.0
41.3
1.65
18.04
31.25
50.94
0.69
0.83
0.39
0.54
(Table 7: Resource Estimate reported > 20g/t Ag)
Comparison with previous resource estimate
The Wonawinta Resource reported as at 30 June 2020 is reproduced below:
17
Pb kt
7.5
102.8
96.9
207.2
Resource
Category
Measured
Indicated
Inferred
Total
Material
(Mt)
Ag (g/t)
Ag Moz
Pb (%)
Pb kt
0.9
8.5
29.4
38.8
45.0
48.5
39.0
42.0
1.3
13.2
37.9
52.4
0.7
0.79
0.55
0.61
6.2
67.5
162.9
236.6
(Table 8: Resource Estimate reported >20 g/t Ag)
Governance arrangements and internal controls
Manuka has put in place governance arrangements and internal controls with respect to its estimates of
Mineral Resources and Ore Reserves and the estimation process, including:
• oversight and approval of each annual statement by external consultants (if the estimate was
prepared internally) or responsible senior officers;
• establishment of internal procedures and controls to meet JORC Code 2012 compliance in all external
reporting;
independent review of new and materially changed estimates;
•
• annual reconciliation with internal planning to validate reserve estimates for operating mines.
Competent Persons retained by the Company are members of the Australasian Institute of Mining and
Metallurgy (AusIMM) and/or the Australian Institute of Geoscientists (AIG) and qualify as Competent Persons
as defined in the JORC Code 2012.
Competent Persons Statements
The information in this report that relates to Mt Boppy Mineral Resources is based on, and fairly represents,
information and supporting documentation prepared by Mr Ian Taylor, who is a Certified Professional by The
Australasian Institute of Mining and Metallurgy and is employed by Mining Associates Pty Ltd. Mr Taylor has
sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration
and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of
the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr Taylor
consents to the inclusion in the report of the matters based on his information in the form and context in
which it appears.
Manuka Resources Ltd
For the year ended 30 June 2022
18
This report includes information that relates to Mt Boppy Mineral Resources which were prepared and first
disclosed under JORC Code 2012. The Company confirms that it is not aware of any new information or data
that materially affects the information included in the July 2022 market announcement and, in the case of
reporting of Mineral Resources, that all material assumptions and technical parameters underpinning the
estimates in the relevant market announcement continue to apply and have not materially changed. The
Company confirms that the form and context in which any Competent Person’s findings are presented have
not been materially modified from the original market announcement.
This report includes information that relates to Wonawinta Mineral Resources which were prepared and first
disclosed under JORC Code 2012. The information was extracted from the Company’s ASX announcement
dated 1 April 2021. The Company confirms that it is not aware of any new information or data that materially
affects the information included in the April 2021 market announcement and, in the case of reporting of
Mineral Resources, that all material assumptions and technical parameters underpinning the estimates in the
relevant market announcement continue to apply and have not materially changed. The Company confirms
that the form and context in which any Competent Person’s findings are presented have not been materially
modified from the original market announcement.
Manuka Resources Ltd
For the year ended 30 June 2022
19
Directors’ Report
The Directors of Manuka Resources Ltd (‘Manuka Resources’) present their report together with the financial
statements of the Entity or the Group, being Manuka Resources (‘the Company’) and its subsidiary Mt Boppy
Resources Pty Ltd (‘Mt Boppy’) for the year ended 30 June 2022.
Manuka Resources Limited is a company limited by shares and incorporated in Australia on the 20th of April
2016.
Director details
The following persons were Directors of Manuka Resources during or since the end of the financial period
and up to the date of this report:
• Mr Dennis Karp
• Mr Anthony McPaul
• Mr Nicholas Lindsay
Mr Dennis Karp
Executive Chairman
Director since 20th April 2016
Mr Karp commenced his career in the Australian financial markets in 1983. He was the Head of Trading at
HSBC Australia prior to joining Tennant Limited in 1997, a substantial Australian domiciled physical commodity
trading company with operations in Asia and Europe. He was a principal shareholder of Tennant Metals until
2010 and managing director from 2000 until December 2014. Mr Karp founded ResCap Investments Pty Ltd in
December 2014.
Over the past 10 years, Mr Karp has been involved in various resource projects and investment opportunities
in base metals and bulk commodities which have had marketing rights attached.
Mr Karp holds a Bachelor of Commerce from the University of Cape Town. Mr Karp does not hold any current
and has not held any former directorships in other listed companies in the last 3 years.
Mr Anthony McPaul
Non-executive Director
Director since 25th November 2016
Mr Anthony McPaul is a senior mining executive with over 40 years’ experience in mining operations and
mineral processing. Mr McPaul has worked in and led both open cut and underground operations and was
most formerly the general manager for Newcrest’s Cadia Valley Operations, in Orange NSW.
Mr McPaul commenced his career as an automotive engineer and progressed to maintenance and then onto
operations management at various companies, including CRA, Denehurst, MIM and more recently Newcrest.
He has successfully managed a wide range of operating projects from base through to precious metals in both
surface and underground mines and has been directly responsible for all aspects of production and scheduling.
Manuka Resources Ltd
For the year ended 30 June 2022
20
Mr McPaul formally retired from Newcrest in July 2016 and has since devoted his time to non-executive and
contract roles. Mr McPaul has represented Newcrest and the resources industry on many boards, such as NSW
Minerals Council, NSW Minerals Council Executive Committee, and was the NSW Minerals Council
representative on the Mine Safety Advisory Council. Mr McPaul has chaired many of these committees.
Mr McPaul is the former Chairman of the NSW Minerals Council Board and Executive Committee and a former
member of the Mineral Industry Advisory Council.
Mr McPaul has formal qualifications in automotive engineering from Goulburn TAFE. Mr McPaul does not hold
any current and has not held any former directorships in other listed companies in the last three years.
Dr Nicholas Lindsay
Non-executive Director
Director since 20th June 2019
Dr Nicholas Lindsay is an experienced mining executive who brings an attractive mix of commercial, technical
and academic qualifications, all of which are relevant to the Company. He has worked directly for a range of
major and mid-tier mining companies over his career, and led juniors in copper, gold and silver though listings
and mergers. Dr Lindsay is a geologist by profession, specialising in process mineralogy, and has postgraduate
degrees from the University of Otago (NZ), the University of Melbourne and the University of the
Witwatersrand (South Africa). He is a member of the Australian Institute of Geoscientists. Mr Lindsay has held
the following Directorships in other listed companies in the 3 years immediately before the end of the financial
year:
Lake Resources NL - Executive Technical Director (current)
•
• Valor Resources Ltd - Chief Executive Officer and Executive Director – Technical (ceased October 2020)
• Daura Capital Corp. - Non-Executive Director (ceased September 2020)
Interests in the shares and options of the Company and related bodies corporate
As at the date of this report, the interests of the directors in the shares and options of Manuka Resources
Limited were:
Ordinary
Shares
91,814,557
-
-
Options over
Ordinary
Shares
2,000,000
1,800,000
1,800,000
Mr Dennis Karp
Mr Anthony McPaul
Dr Nick Lindsay
Company Secretary details
Ms Toni Gilholme
Company Secretary since 20th April 2016
Ms Toni Gilholme is an experienced Financial Controller and a Qualified Chartered Accountant with over 15
years of experience in Financial Accounting and Company Secretarial matters and over 10 years of experience
in Public Practice.
Manuka Resources Ltd
For the year ended 30 June 2022
21
Ms. Gilholme holds a Bachelor of Business from the University of Technology, Sydney and is a qualified
Chartered Accountant.
Principal activities
During the period, the principal activities undertaken by the Group were:
• Completion of Phase 1 of mining operations at Mt Boppy together with ore haulage and processing
through the Wonawinta plant11.
• Release12 of an updated Mineral Resource Estimate for the Mt Boppy Gold project
• Commencement of a trial phase of silver oxide stockpile processing at the Wonawinta Silver Project This
trial phase of operations will inform the Company of any additional work required as part of the mine
planning studies for Wonawinta, principally in the areas of material handling.
Review of operations
Information on the operations and financial position of the group and its business strategies and prospects is
set out in the review of operations on pages 5 to 15 of this annual report.
Significant changes in state of affairs
During the year there have been no significant changes in the state of affairs of the Group other than:
• Wonawinta Silver Project
A trial phase of silver stockpile commenced during Q2 to obtain valuable processing and metallurgical data
which will better inform mine planning for the oxide silver resource at Wonawinta. These trials will
determine if finer sizings should bypass the primary ball mill and be set straight to the leach circuit via the
secondary mill. Recent operating performance has shown a significant distribution of high-grade silver
species in the finer fractions of the ore. These results are expected to have a material result on the overall
metallurgical recoveries of the various lithologies in the ore on the stockpiles and hence representative of
the insitu oxide resource of the project.
• Secured Debt Facility Extension and issuance of options
During the period, the Company documented the extension of the term of the facility to 30 September
202213. The agreement was signed by the parties on the 20th July 2021. The first tranche of Options
pursuant to the term of the negotiated extension, being 5,000,000 options at a strike price of $0.30 with
an expiry of 28 July 2023, were issued on 28 July 2021. Subsequent to the end of the reporting period a
further extension of the Secured Debt Facility to 30 September 2023 has been agreed.14
• Coronavirus (COVID-19) pandemic
Throughout the reporting period the Company has continued to consider the potential implications of the
Coronavirus. The Company has continued to adapt its policies to monitor and mitigate the impacts of
COVID-19 such as safety and health measures in line with government guidelines and securing the supply
of essential materials and equipment. During August 2021, a worker who had left site returned a positive
result for COVID-19 as he prepared to return to site. The test was conducted in line with our standard
operating procedures (the requirement of a current negative test result prior to returning to work). This
11 Refer ASX release dated 4 March 2022
12 Refer ASX release dated 29 July 2022
13 Refer ASX announcements dated 14 May 2021 and 29 June 2021
14 Refer ASX announcement 24 August 2022
Manuka Resources Ltd
For the year ended 30 June 2022
22
led to a number of on-site workers being tested and placed in isolation. The health and welfare of our
employees is fundamental to our Company, and Manuka management worked closely with NSW Health
and its regional agencies. All close contacts returned negative results on initial and subsequent retests. No
parties including the primary contact reported any adverse symptoms. These actions caused a temporary
period of limited activity at the plant and importantly tested the Company’s Covid management plan.
Containing a possible transmission of the virus to protect our employees has been a priority since the risk
of COVID–19 arose in March 2020 and continues to be the case and protocols are in place for such a
circumstance. The Company does maintain a dual roster workforce and is able to recall additional workers
to site if necessary. Even with the above there been no significant impact to the Group’s operations.
Dividends
No dividends were paid or declared during the financial year and no recommendation is made as to
dividends.
Events arising since the end of the reporting period
• Execution of Binding Term Sheet for the purchase of Trans-Tasman Resources Limited (“TTR”)
Manuka entered into a Binding Term Sheet for the purchase (subject to Manuka shareholder approval) of
emerging vanadiferous titanomagnetite iron sands producer Trans-Tasman Resources Limited on 1st
August 202215. Manuka will acquire 100% of TTR for the issue of between 170-180 million new Manuka
shares. TTR is the owner of a 3.8B tonne iron sands resource located in the South Taranaki Bight on the
North Island of New Zealand. Post completion of this transaction a bankable feasibility study will be
progressed based on offshore recovery and processing of this resource into an iron ore concentrate with
vanadium and titanium credits.
• Extension of Secured Debt Facility Extension
Since the end of the reporting period, the Company successfully negotiated to extend the term of the
secured debt facility to 30 September 2023.16 The extension has been granted on existing terms and rates
with no extension penalties or cash fees. The Company has resolved at a Board meeting held 29th
September 2022 to grant the issue of 5Million options with an exercise price based on the 5-day VWAP
plus a 10% premium.
• Coronavirus (COVID-19) pandemic
Throughout the reporting period the Company has continued to consider the potential implications of the
Coronavirus. The Company has continued to adapt its policies to monitor and mitigate the impacts of
COVID-19 such as safety and health measures in line with government guidelines and securing the supply
of essential materials and equipment. The health and welfare of our employees is fundamental to our
Company, and Manuka management have been working closely with NSW Health and its regional
agencies.
Containing a possible transmission of the virus to protect our employees has been a priority since the risk
of COVID–19 arose in March 2020 and continues to be the case and protocols are in place for such a
circumstance. The Company does maintain a dual roster workforce and is able to recall additional workers
to site if necessary. Even with the above there been no significant impact to the Group’s operations.
15 Refer ASX release dated 1 August 2022
16 Refer ASX release dated 24 August 2022
Manuka Resources Ltd
For the year ended 30 June 2022
23
Apart from the matters noted above, there are no other matters or circumstances that have arisen since the
end of the period that has significantly affected or may significantly affect either:
•
•
•
the Group’s operations in future financial years;
the results of those operations in future financial years; or
the Group’s state of affairs in future financial years.
Likely developments
Processing of the silver oxide ores at Wonawinta is likely to continue till end of 2022 or early 2023. This trial
phase of silver operations will assist the company in subsequent mine planning on the Wonawinta mining
lease. As discussed above the Company continues to expand its greenfield exploration activities on distal
exploration licences which target gold and copper prospects as well as brownfields silver-lead-zinc primary
and secondary mineralisation on and adjacent to the Wonawinta mining lease.
Further information on the likely developments of the group and its business strategies and prospects is set
out in the review of operations on pages 5 to 15 of this annual report.
Directors’ meetings
The number of meetings of Directors (including meetings of Committees of Directors) held during the period
and the number of meetings attended by each Director is as follows:
Board Member
Dennis Karp
Anthony McPaul
Nicholas Lindsay
Board Meetings
A
11
11
11
B
11
11
10
Where:
column A: is the number of meetings the Director was entitled to attend
column B: is the number of meetings the Director attended
Corporate Governance Statement
For the financial year ended 30 June 2022 (Reporting Period) the Company has adopted the fourth edition of
the Corporate Governance Principles and Recommendations released by the ASX Corporate Governance
Council. The Company’s 2022 Annual Corporate Governance Statement has been approved by the Board and
is publicly available on the Company’s website at www.manukaresources.com.au/site/about/corporate-
governance. It will also be released to the ASX at the same time as this 2022 Annual Report.
Manuka Resources Ltd
For the year ended 30 June 2022
24
Unissued shares under option
Unissued ordinary shares of Manuka Resources under option at the date of this report are:
Date Options Granted
Expiry Date Exercise Price
of Shares
$
Number under
option
Apr 2020
Mar 2020
June 2020
Jul 2021
Sep 2021
Jan 2022
Mar 2022
Apr 2022
17th Apr 2023
17th Apr 2023
14th Jul 2023
28th Jul 2023
30th Sep 2023
11th Jan 2024
4th Mar 2023
8th Apr 2023
$0.25
$0.25
$0.25
$0.30
$0.32
$0.50
$0.50
$0.50
3,250,000
8,000,000
10,000,000
5,000,000
5,000,000
1,100,000
13,620.002
8,046,667
No shares were issued during or since the end of the year as a result of exercise of the options.
Environmental legislation
The operations of Manuka Resources Limited are subject to a number of particular and significant
environmental regulations under a law of the Commonwealth or of a State or Territory in Australia.
All conditions governing the administration of various environmental and tenement licences have been
complied with. So far as the Directors are aware there has been no known breach of the Group’s licence
conditions and all activities comply with relevant environmental regulations. The Directors are not aware of
any environmental regulation which is not being complied with.
Sustainability
During the current reporting period, Manuka Resources (MKR) released its Sustainability Statement. This is
intended as a signal of the Company’s intent and commitment to fulfil its ESG obligations.
The Company is committed to accepting accountability for its sustainability performance and to this end has
approved a number of actions. The renamed Audit, Risk & Sustainability Sub-Committee specifically highlights
the importance of focusing on sustainability performance, and the Board Charter has been amended
accordingly. The Company is in the process of reviewing and updating all polices targeting activities which may
have environmental and social impacts. At an operational level, all capital expenditure requests now require
an additional assessment of environmental, social and governance factors.
The Company has published its Sustainability Statement, highlighting our priorities and commitments,
including a commitment to align to the United Nations’ SDG’s (Sustainable Development Goals).
An important consideration in addressing potential impacts is ensuring we are engaged with all our relevant
stakeholders. As a first early step in this journey, we have undertaken an initial internal stakeholder materiality
impact assessment and plan to broaden this over the next year to include better engagement with key
stakeholders.
As we build our capabilities and maturity, we are planning improved sustainability disclosure, providing
increased levels of reporting transparency both internally and publicly. Our disclosure reporting will align with
the internationally recognised GRI (Global Reporting Initiative) Reporting Principles and Standards. To support
our reporting and disclosure activities over the next reporting period, we have commenced using a mining-
sector specific, sustainability reporting platform.
Manuka Resources Ltd
For the year ended 30 June 2022
25
Finally, we will be refreshing our website to highlight our sustainability commitments and improve the visibility
of our actions and impact.
Remuneration report (audited)
The information provided in this remuneration report has been audited as required by section 308(3C) of the
Corporations Act 2001. The remuneration report sets out remuneration information for the Company’s
Executive Director, Non-Executive Directors and other Key Management Personnel (“KMP”). The report
contains the following sections:
a) Key Management Personnel disclosed in this report;
b) Remuneration policy;
c) Performance-based remuneration;
d) Company performance, shareholder wealth and directors’ and executives’ remuneration;
e) Use of remuneration consultants;
f) Details of remuneration;
g) Service agreements;
h) Share-based compensation;
i) Equity instruments held by Key Management Personnel; and
j) Other transactions with Key Management Personnel.
a) Key Management Personnel disclosed in this report
Non-Executive and Executive directors (refer pages 19 to 20 for details on each director)
• Dennis Karp
• Anthony McPaul
• Nick Lindsay
Other Key Management Personnel
• Haydn Lynch, Chief Operations Officer (from 1st July 2019)
There have been no changes to directors or KMP since the end of the reporting period.
b) Remuneration policy
The remuneration policy of Manuka Resources Limited has been designed to align key management personnel
objectives with shareholder and business objectives by providing a fixed remuneration component and
offering specific long-term incentives based on key performance areas affecting the Group’s financial results.
The board of Manuka Resources Limited believes the remuneration policy to be appropriate and effective in
its ability to attract and retain the best key management personnel to run and manage the Group.
The board’s policy for determining the nature and amount of remuneration for key management personnel of
the Group is as follows:
• The remuneration policy, setting the terms and conditions for the executive directors and other senior
executives (if any), was developed by the board. All executives receive a base salary (which is based on
factors such as length of service and experience) and superannuation. The board reviews executive
packages annually by reference to the Group’s performance, executive performance and comparable
information from industry sectors and other listed companies in similar industries.
Manuka Resources Ltd
For the year ended 30 June 2022
26
• The board exercises its discretion in relation to approving incentives, bonuses and options. The policy is
designed to attract and retain the highest calibre of executives and reward them for performance that
results in long term growth in shareholder wealth.
• Executives are also entitled to participate in the employee share and option arrangements.
• The executive directors and executives (if any) receive a superannuation guarantee contribution required
by the government, which was 10% for the 2022 financial year (2021: 9.5%), and do not receive any other
retirement benefits. Some individuals may choose to sacrifice part of their salary to increase payments
towards superannuation.
• All remuneration paid to directors and executives is valued at the cost to the Group and expensed. The
cost of share-based payments is measured by reference to the fair value at the date at which they are
granted using an option pricing model.
• The board policy is to remunerate non-executive directors at market rates for comparable companies for
time, commitment, and responsibilities. The board determines payments to the non-executive directors
and reviews their remuneration annually, based on market practice, duties and accountability.
Independent external advice is sought when required. The maximum aggregate amount of fees that can
be paid to non-executive directors is subject to approval by shareholders at the Annual General Meeting
(currently $240,000). Fees for non-executive directors are not linked to the performance of the Group.
However, to align directors’ interests with shareholder interests, the directors are encouraged to hold
shares in the Company.
c) Performance-based remuneration
The Group currently has no formal performance-based remuneration component built into key management
personnel remuneration packages. Remuneration and discretionary share based payments are issued to align
the Directors’ interest with that of shareholders.
d) Company performance, shareholder wealth and directors’ and executives’ remuneration
Whilst no formal policy exists, remuneration is tailored to increase the direct positive relationship between
shareholders’ investment objectives and key management personnel performance. Currently, this is facilitated
through the issue of options to the majority of key management personnel to encourage the alignment of
personal and shareholder interests. The Group believes this policy will be effective in increasing shareholder
wealth.
The table below shows the gross revenue, profits and (losses) and earnings per share for the last five financial
periods for the listed entity.
2022
$
Revenue and other income 53,271,499
Net profit / (loss)
5,281,420
Profit / (loss) per share
(cents) *
Share price
1.92
$0.17
2021
restated
$
44,544,455
(3,074,177)
2020
restated
$
9,468,320
(3,884,45)
2019
$
-
(5,428,238)
2018
$
1
(4,344,351)
(1.19)
$0.32
(2.80)
n/a
(4.08)
n/a
(3.28)
n/a
No dividends have been paid during the financial years ended 30 June 2018 to 30 June 2022.
* In accordance with AASB 133 paragraph 26, the weighted average number of shares outstanding during the
period and for all periods presented shall be adjusted for events (such as a share consolidation) that have
changed the number of shares outstanding without a corresponding change in resources. As a result, the share
Manuka Resources Ltd
For the year ended 30 June 2022
27
consolidation which occurred on 11th May 2020 has been applied to the full financial year ended 30 June 2020
and all the previous reporting periods.
e) Use of remuneration consultants
The Group did not employ the services of any remuneration consultants during the financial year ended 30
June 2022 (2021: None).
f) Details of remuneration
Details of the remuneration of the key management personnel of the Group are set out in the following table.
Fixed Remuneration
Variable
Remuneration
Salary/
Directors Fee
$
$343,300
$240,000
$55,004
$45,000
$55,004
$78,800
Salary/
Directors Fee
$
$278,105
$219,178
$731,413
$582,978
Non-
Monetary
Benefits
$
-
-
-
-
-
-
Accrual for
Annual and
Long Service
Leave
$
Superannuation
Options
$
$
Total
$
$52,860
$21,192
$22,885
$21,003
$31,690
$450,735
-
$282,195
-
-
-
-
-
-
-
-
$19,014
-
$74,018
$45,000
$19,014
-
$74,018
$78,800
Fixed Remuneration
Variable
Remuneration
Non-
Monetary
Benefits
$
-
-
-
-
Accrual for
Annual and
Long Service
Leave
$
$33,555
$16,095
$86,415
$37,287
Superannuation
Options
$
$22,743
$20,822
$
-
-
Total
$
$334,403
$256,095
$45,628
$41,825
$69,718
$933,174
-
$662,090
Directors
Dennis Karp
2022
2021
Anthony McPaul17
2022
2021
Nick Lindsay 18
2022
2021
Other KMP (Group)
Haydn Lynch
2022
2021
Total KMP remuneration
expensed
2022
2021
g) Service agreements
The details of service agreements of the key management personnel of the Group are as follows:
Dennis Karp, Executive Chairman:
(a) Mr Karp was appointed Executive Chairman on 1 March 2020 at an annual salary of $240,000 (exclusive
of superannuation) plus any Compulsory Superannuation. This was increased effective 1 January 2022
to $350,000 plus any Compulsory Superannuation; and
17 Director fees for Mr McPaul are paid into a Company nominated by Mr McPaul.
18 Director fees for Mr Lindsay are paid into a Company nominated by Mr Lindsay.
Manuka Resources Ltd
For the year ended 30 June 2022
28
(b)
The agreement is ongoing until terminated in accordance with the agreement. Mr Karp may terminate
the agreement by giving 12 weeks’ notice in writing to the Company and the Company may terminate
the agreement (without cause) by giving Mr Karp 12 weeks’ written notice or by making payment in lieu
of notice.
Haydn Lynch, Chief Operations Officer:
(a) Mr Lynch was appointed Chief Operating Officer on 1 July 2019 at annual salary of $240,000 (inclusive
of superannuation). This was increased effective 1 January 2022 to $250,000 plus any Compulsory
Superannuation; and
The agreement is ongoing until terminated in accordance with the agreement. Mr Lynch may terminate
the agreement by giving 12 weeks’ notice in writing to the Company and the Company may terminate
the agreement (without cause) by giving Mr Lynch 12 weeks’ written notice or by making payment in
lieu of notice.
(b)
Anthony McPaul and Nicholas Lindsay, Non-executive Directors:
The non-executive directors (NEDs) have entered into service agreements with the company in the form of a
letter of appointment. The letter summarises the board policies and terms, including remuneration, relevant
to the office of director. Annual remuneration is $60,000 per annum effective 1 January 2022 (previously
$45,000 per annum), with additional fees payable where the Board determines special duties, or services
outside the scope of the of the ordinary duties of a NED, have been performed. Remuneration is subject to
annual review by the Board and reasonable notice of an intention to resign or to not seek re-election should
be given to the Company.
h) Share-based compensation
Options
Options are issued to key management personnel as part of their remuneration. The options are not issued
based on performance criteria but are issued to the majority of key management personnel of Manuka
Resources Limited to increase goal congruence between key management personnel and shareholders. The
following options were granted to or vesting with key management personnel during the year:
Grant Date
Granted
Number
Vesting
Date
Expiry Date
Exercise
Price
(cents)
Value Per
Option at
Grant Date
(cents) 19
Exercised
Number
% of
Remuner-
ation
Directors
Dennis Karp
13/12/2021
500,000
13/12/2021
11/01/2024
Anthony McPaul
13/12/2021
300,000
13/12/2021
11/01/2024
Nick Lindsay
13/12/2021
300,000
13/12/2021
11/01/2024
50.0
50.0
50.0
6.34
6.34
6.34
Nil
Nil
Nil
7.5%
25.7%
25.7%
For options granted during the current year, the valuation inputs for the option pricing model were as follows:
Underlying
Share Price
(cents)
Exercise Price
(cents)
Volatility
Interest Rate Valuation Date
Expiry Date
Risk Free
Directors
30.5
50
64%
0.25%
13/12/2021
11/01/2024
19 The value at grant date in accordance with AASB 2: Share Based Payments of options granted during the year as part of remuneration.
Manuka Resources Ltd
For the year ended 30 June 2022
29
No ordinary shares in the Company have been provided as a result of the exercise of remuneration options to
each director of Manuka Resources Limited and other key management personnel of the Group during the
year.
i) Equity instruments held by Key Management Personnel
Share holdings
The numbers of shares in the Company held during the financial year by each director of Manuka Resources
Limited and other key management personnel of the Group, including their related parties, and any nominally
held, are set out below. There were no shares granted during the reporting period as compensation.
Directors
Dennis Karp
Anthony McPaul
Nicholas Lindsay
Other KMP
Haydn Lynch
Received
during the
year on the
exercise of
Options
Other
changes
during the
year
-
-
-
-
-
-
-
-
Balance at
start of the
year
91,814,557
-
-
-
Balance at
end of the
year
91,814,557
-
-
-
Option holdings
The numbers of options over ordinary shares in the Company held during the financial year by each director
of Manuka Resources Limited and other key management personnel of the Group, including their personally
related parties, and any nominally held, are set out below.
Balance at
start of the
year
Granted as
compen-
sation
Exercised
Other
changes
Balance at
end of the
year
Vested and
exercisable
Unvested
Directors
Dennis Karp
1,500,000
Anthony McPaul
1,500,000
Nicholas Lindsay
1,500,000
500,000
300,000
300,000
Other KMP
Haydn Lynch
1,500,000
-
-
-
-
-
-
-
-
-
2,000,000
2,000,000
1,800,000
1,800,000
1,800,000
1,800,000
1,500,000
1,500,000
-
-
-
-
All vested options are exercisable. Details of options held by Directors are as follows:
Exercise price of 25 cents, expiry 14 April 2023
Directors
Dennis Karp
Anthony McPaul
Nicholas Lindsay
Other KMP
Haydn Lynch
# options held
1,500,000
1,500,000
1,500,000
1,500,000
Exercise price of 50 cents, expiry 11 January 2024
Directors
Dennis Karp
Anthony McPaul
Nicholas Lindsay
# options held
500,000
300,000
300,000
Manuka Resources Ltd
For the year ended 30 June 2022
30
j) Other transactions with Key Management Personnel
• Rescap Investments Pty Ltd - A director, Mr Dennis Karp, is a director of, and holds a controlling interest
in, ResCap Investments Pty Ltd (“ResCap”). The Group has borrowing arrangements with ResCap.
Aggregate amounts of each of the above types of other transactions with key management personnel of
Manuka Resources Limited:
Details of related party transactions with ResCap through
the loan facility:
•
interest charged on loan
Details of balances with related parties:
Balance of loan with Manuka Resources Ltd
- payable to ResCap Investments Pty Ltd
Balance of loan with Mt Boppy Resources Pty Ltd
- payable to ResCap Investments Pty Ltd
End of audited Remuneration Report
30 June
2022
$
30 June
2021
$
29,184
83,640
909,959
1,624,493
-
84,143
Indemnities given to, and insurance premiums paid for, auditors and officers
During the period, Manuka Resources has paid a premium to insure officers of the Company. The officers of
the Company that are covered by the insurance policy includes all directors.
The liabilities insured are legal costs that may be incurred in defending civil or criminal proceedings that may
be brought against the officers in their capacity as officers of the Company, and any other payments arising
from liabilities incurred by the officers in connection with such proceedings, other than where such liabilities
arise out of conduct involving a wilful breach of duty by the officers or the improper use by the officers of their
position or of information to gain advantage for themselves or someone else to cause detriment to the
Company.
The Company has not otherwise, during or since the end of the financial period, except to the extent permitted
by law, indemnified or agreed to indemnify any current or former officer of the Company against a liability
incurred as such by an officer.
The Company has agreed to indemnify its auditors, Ernst & Young, to the extent permitted by law, against any
claim by a third party arising from the Company’s breach of its agreement. The indemnity requires the
Company to meet the full amount of any such liabilities including a reasonable amount of legal costs.
Proceedings on behalf of the Company
No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring
proceedings on behalf of the Company, or to intervene in any proceedings to which the Company is a party,
for the purpose of taking responsibility on behalf of the Company for all or part of those proceedings.
No proceedings have been brought, or intervened in, on behalf of the company with leave of the court under
section 237 of the Corporations Act 2001.
Manuka Resources Ltd
For the year ended 30 June 2022
31
Audit and non-audit services
Details of the amounts paid or payable to the auditor (Ernst & Young) for audit and non-audit services during
the year are disclosed in Note .
The Company may decide to employ the auditor on assignments additional to their statutory audit duties
where the auditor’s expertise and experience with the Company and/or the Group are important.
The board of directors is satisfied that the provision of the non-audit services is compatible with the general
standard of independence for auditors imposed by the Corporations Act 2001. There were no non-audit
services during the financial year ended 30 June 2022.
Auditor’s Independence Declaration
A copy of the Auditor’s Independence Declaration as required under s.307C of the Corporations Act 2001 is
included on the following page of this financial report and forms part of this Directors’ Report.
Signed in accordance with a resolution of the Directors
Dennis Karp
Executive Chairman
Dated the 30th day of September 2022
Ernst & Young
200 George Street
Sydney NSW 2000 Australia
GPO Box 2646 Sydney NSW 2001
Tel: +61 2 9248 5555
Fax: +61 2 9248 5959
ey.com/au
Auditor’s independence declaration to the directors of Manuka Resources
Limited
As lead auditor for the audit of the financial report of Manuka Resources Limited for the financial year
ended 30 June 2022, I declare to the best of my knowledge and belief, there have been:
a. No contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit;
b. No contraventions of any applicable code of professional conduct in relation to the audit; and
c. No non-audit services provided that contravene any applicable code of professional conduct in
relation to the audit.
This declaration is in respect of Manuka Resources Limited and the entities it controlled during the
financial year.
Ernst & Young
Siobhan Hughes
Partner
30 September 2022
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
Manuka Resources Ltd
For the year ended 30 June 2022
33
Consolidated Statement of Profit or Loss and
Other Comprehensive Income
For the year ended 30 June 2022
Notes
6(a)
7(a)
6(b)
7(c)
7(e)
7(f)
8
9
Sales revenue
Cost of sales
Operating profit
Other income
Other expenses
Share based payment credit / (expense)
Foreign exchange gains / (losses)
Profit /(loss) before finance expenses
Finance expenses
Profit / (loss) before income tax
Income tax expense
Profit / (loss) for the period attributable to
members of Manuka Resources Limited
Other comprehensive profit / (loss) - items that
will be reclassified subsequently to profit or
loss
Cashflow hedging profit / (loss)
Total comprehensive profit / (loss) for the year
attributable to members of Manuka Resources
Limited
30 June
2022
$
Restated 20
30 June
2021
$
53,271,499
43,752,567
(41,244,405)
(43,312,892)
12,027,094
439,675
304,621
791,888
(2,540,079)
(2,387,032)
(69,718)
(1,025,343)
8,696,575
(3,415,155)
-
1,721,880
566,411
(3,640,588)
5,281,420
(3,074,177)
-
-
5,281,420
(3,074,177)
6,297
6,297
(6,297)
(6,297)
5,287,717
(3,080,474)
Profit / (loss) per share for loss attributable to
the ordinary equity holders of the Company
Basic profit /(loss) per share (cents per share)
Diluted profit /(loss) per share (cents per share)
25
25
1.92
1.61
(1.19)
(1.19)
This statement should be read in conjunction with the notes to the financial statements.
20 Refer Note 4
Manuka Resources Ltd
For the year ended 30 June 2022
34
Consolidated Statement of Financial Position
As of 30 June 2022
Assets
Current
Cash and cash equivalents
Trade and other receivables
Contract assets
Inventories
Prepayments
Other financial assets
Total current assets
Non-current
Mine properties and development assets
Exploration and evaluation assets
Property, plant and equipment
Right of use asset
Other financial assets
Total non-current assets
Total assets
Liabilities
Current
Trade and other payables
Provisions
Contract liabilities
Derivative liabilities
Borrowings
Lease liabilities
Current liabilities
Non-current
Provisions
Lease liabilities
Borrowings
Total non-current liabilities
Total liabilities
Net assets / (deficit)
30 June
2022
$
Restated21
30 June
2021
$
Restated
30 June
2020
$
1,160,615 1,018,035
430,582 693,571
- 4,533
1,509,040
7,653,740
-
2,889,123 4,692,287
2,007,761
770,552 569,627
351,127
Notes
12
13
15
14
20.3
186,000 84,000
-
5,436,872 7,062,053
11,521,668
16
17
18
19
20.3
21
22
20.4
20.2
19
22
19
20.2
5,415,800
8,457,839
15,359,140
374,641
6,552,225
6,087,628
9,151,674
4,780,492
322,305
12,212,916
10,711,303
68,083
194,557
7,063,984
7,124,778
36,159,645
30,213,103
27,504,617
41,596,517
37,275,156
39,026,285
6,242,625 9,979,330 7,670,573
628,315 460,189
188,617
62,183
-
-
6,297
-
-
13,053,251
124,901 75,419
-
25,704,579
128,937
20,111,275
10,521,235
33,692,706
7,594,510
7,457,767
7,038,820
259,040 694
73,078
57,927 16,621,347
-
7,911,477
24,079,808
7,111,898
28,022,752
34,601,043
40,804,604
13,573,765
2,674,113
(1,778,319)
This statement should be read in conjunction with the notes to the financial statements.
21 Refer Note 4
Manuka Resources Ltd
For the year ended 30 June 2022
35
Notes
23
26
26
30 June
2022
$
Restated22
30 June
2021
$
Restated
30 June
2020
$
25,771,113
21,512,355
-
-
5,112,041
8,867,407
2,839,254 1,486,077 1,486,077
-
(6,297)
-
(15,036,602)
(20,318,022)
(17,243,844)
13,573,765
2,674,113
(1,778,319)
Equity
Share capital
Other contributed equity
Share based payment reserve
Hedging reserve
Accumulated losses
Total equity
This statement should be read in conjunction with the notes to the financial statements.
22 Refer Note 4
Manuka Resources Ltd
For the year ended 30 June 2022
36
Consolidated Statement of Changes in Equity
For the year ended 30 June 2022
Share
Capital
Other
Contributed
Equity
Share-
based
payment
reserve
Hedging
reserve
Accumulated
losses
Total equity
$
$
$
$
$
5,112,041
8,867,407
1,486,077
Restated balance at 1 July
2020
Restated loss for the period
Other comprehensive
income
Total comprehensive loss
for the period
Contribution of equity
-
-
-
-
-
-
18,231,000
(10,231,000)
Share issue costs
(1,830,686)
1,363,593
-
-
(17,243,844)
(1,778,319)
(3,074,177)
(3,074,177)
(6,297)
-
(6,297)
(6,297)
(3,074,177)
(3,080,474)
-
-
-
-
8,000,000
(467,093)
-
-
-
-
-
Restated balance at 30
June 2021
Profit for the period
Other comprehensive profit
Total comprehensive loss
for the period
Contribution of equity
Share based payments
Share issue costs
21,512,355
-
-
-
5,000,000
-
(741,242)
Balance at 30 June 2022
25,771,113
-
-
-
-
-
-
-
-
1,486,077
(6,297)
(20,318,022)
2,674,113
-
-
-
-
1,353,177
-
2,839,254
-
5,281,420
5,281,420
6,297
6,297
-
-
-
-
-
6,297
5,281,420
5,287,717
-
-
-
5,000,000
1,353,177
(741,242)
(15,036,602)
13,573,765
This statement should be read in conjunction with the notes to the financial statements.
Manuka Resources Ltd
For the year ended 30 June 2022
37
Consolidated Statement of Cash Flows
For the year ended 30 June 2022
Notes
2022
$
2021
$
Operating activities
Receipts from customers
Payments to suppliers and employees
Other income
Finance costs paid
Net cash from operating activities
24
Investing activities
Acquisition of property, plant and equipment
Sale of property, plant and equipment
Payments for development and exploration assets
Payment for other assets
Net cash (used in) investing activities
Financing activities
Proceeds from borrowings
Repayments of borrowings
Repayment of lease liabilities
Proceeds from issues of ordinary shares
Costs of issue of ordinary shares
Net cash from financing activities
Net change in cash and cash equivalents
Cash and cash equivalents, at beginning of the period
Cash and cash equivalents, at end of period
12
53,537,741
43,708,204
(43,023,213)
(40,079,469)
302,461
(2,465,743)
8,351,246
791,888
(4,212,830)
207,793
(6,903,932)
(2,292,825)
225,128
(1,974,742)
92,345
(8,561,201)
375,680
(4,560,884)
(133,071)
5,000,000
(329,190)
352,535
142,580
1,018,035
1,160,615
-
(5,577,475)
(158,803)
(8,029,103)
550,000
(6,184,480)
(148,122)
14,000,000
(887,093)
7,330,305
(491,005)
1,509,040
1,018,035
This statement should be read in conjunction with the notes to the financial statements.
Manuka Resources Ltd
For the year ended 30 June 2022
38
Notes to the Financial Statements
Nature of operations and general information and statement of compliance
1
The principal activities of Manuka Resources Ltd comprise mine development, mining and processing of silver
and gold and exploration activities.
During the financial year the Company’s principal activities related to continuing mining from the Mt Boppy
pit until completion of mining in November 2021, gold production and the transition to silver production at
the Wonawinta plant23. Field activities for exploration consisted of drilling targets on the western and eastern
tenement portfolio and designing additional geophysics programs to investigate newly identified prospects.
In addition, the Company completed the first phase of the ground gravity program over the mineral resource
at Wonawinta and identified a number of additional sulphide targets24.
The financial report includes the consolidated financial statements and notes of Manuka Resources Limited
and its controlled entity Mt Boppy Resources Pty Ltd (Consolidated Group or Group).
These general purpose financial statements have been prepared in accordance with Australian Accounting
Standards and Interpretations issued by the Australian Accounting Standards Board and the Corporations Act
2001. These include Australian equivalents to International Financial Reporting Standards (AIFRS). Compliance
with AIFRS ensures the that the financial report, comprising the financial statements and the notes, complies
with International Financial Reporting Standards (IFRS). Manuka Resources Limited is a for-profit entity for the
purpose of preparing the financial statements.
Manuka Resources Ltd is a Public Company incorporated and domiciled in Australia. The address of its
registered office and its principal place of business is Level 4, Grafton Bond Building, 201 Kent Street, Sydney,
New South Wales.
The consolidated financial statements for the year ended 30 June 2022 were approved and authorised for
issue by the Board of Directors on 30 September 2022. The directors have the power to amend and reissue
the financial statements.
2
Changes in accounting policies
2.1 New and amended standards adopted
The Group applied for the first-time certain standards and amendments, which are effective for annual periods
beginning on or after 1 January 2021 (unless otherwise stated). The Group has not early adopted any other
standard, interpretation or amendment that has been issued but is not yet effective.
23 Refer ASX announcement dated 28 January 2022
24 Refer ASX announcement Quarterly Activities report dated 29 July 2022
Manuka Resources Ltd
For the year ended 30 June 2022
39
Interest Rate Benchmark Reform – Phase 2: Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16
The amendments provide temporary reliefs which address the financial reporting effects when an interbank
offered rate (IBOR) is replaced with an alternative nearly risk-free interest rate (RFR). The amendments include
the following practical expedients:
•
•
•
A practical expedient to require contractual changes, or changes to cash flows that are directly required
by the reform, to be treated as changes to a floating interest rate, equivalent to a movement in a market
rate of interest
Permit changes required by IBOR reform to be made to hedge designations and hedge documentation
without the hedging relationship being discontinued
Provide temporary relief to entities from having to meet the separately identifiable requirement when
an RFR instrument is designated as a hedge of a risk component
These amendments had no impact on the consolidated financial statements of the Group. The Group intends
to use the practical expedients in future periods if they become applicable.
Covid-19-Related Rent Concessions beyond 30 June 2021 Amendments to IFRS 16
On 28 May 2020, the IASB issued Covid-19-Related Rent Concessions - amendment to IFRS 16 Leases. The
amendments provide relief to lessees from applying IFRS 16 guidance on lease modification accounting for
rent concessions arising as a direct consequence of the Covid-19 pandemic. As a practical expedient, a lessee
may elect not to assess whether a Covid-19 related rent concession from a lessor is a lease modification. A
lessee that makes this election accounts for any change in lease payments resulting from the Covid-19 related
rent concession the same way it would account for the change under IFRS 16, if the change were not a lease
modification.
The amendment was intended to apply until 30 June 2021, but as the impact of the Covid-19 pandemic is
continuing, on 31 March 2021, the IASB extended the period of application of the practical expedient to 30
June 2022.The amendment applies to annual reporting periods beginning on or after 1 April 2021.
The Group has not received Covid-19-related rent concessions but plans to apply the practical expedient if it
becomes applicable within allowed period of application.
2.2 Accounting standards and interpretations not yet effective
New accounting standards and interpretations that have been published that are not mandatory for the 30
June 2022 reporting period, have not been early adopted by the Group.
The directors of the Company anticipate that the application of the amendments of the new Standards and
Amendments will not have a material impact on the Group's consolidated financial statements, as many of the
amendments either do not affect the Group’s existing accounting policies, or apply to situations, transactions
and events that the Group does not undertake, except as outlined below:
AASB 2020-3 Amendments to Australian Accounting Standards - Annual Improvements 2018–2020 and
Other Amendments
Property, Plant and Equipment — Proceeds before Intended Use
The amendments to AASB 116 Property, Plant and Equipment prohibit deducting from the cost of an item of
property, plant and equipment any proceeds from selling items produced while bringing that asset to the
location and condition necessary for it to be capable of operating in the manner intended by management.
Instead, the proceeds from selling such items, and the cost of producing those items, is recognised in profit or
loss.
Manuka Resources Ltd
For the year ended 30 June 2022
40
The amendments also clarify the meaning of ‘testing whether an asset is functioning properly’. AASB 116 now
specifies this as assessing whether the technical and physical performance of the asset is such that it is capable
of being used in the production or supply of goods or services, for rental to others or for administrative
purposes.
The amendments are applied retrospectively, but only to items of property, plant and equipment that are
brought to the location and condition necessary for them to be capable of operating in the manner intended
by management or on or after the beginning of the earliest period presented in the financial statements in
which the entity first applies the amendments.
The directors of the Company anticipate that the application of the amendments will likely impact on the
Group's accounting policies in respect of the construction of assets, as certain proceeds of selling items
produced whilst bringing assets under construction are currently deducted from the cost of the asset.
However, the directors have not assessed the financial effect of this change in accounting policy.
AASB 2021-2 Amendments to Australian Accounting Standards – Disclosure of Accounting Policies and
Definition of Accounting Estimates
AASB 2021-2 amends AASB Standards to improve accounting policy disclosures so that they provide more
useful information to investors users of the financial statements and clarify the distinction between accounting
policies and accounting estimates. Specifically, AASB 2021-2 amends:
•
AASB 7 Financial Instruments: Disclosures, to clarify that information about measurement bases for
financial instruments is expected to be material to an entity’s financial statements
AASB 101 Presentation of Financial Statements, to require entities to disclose their material accounting
policy information rather than their significant accounting policies
AASB 108 Accounting Policies, Changes in Accounting Estimates and Errors, to clarify how entities should
distinguish changes in accounting policies and changes in accounting estimates
AASB 134 Interim Financial Reporting, to identify material accounting policy information as a
component of a complete set of financial statements
AASB Practice Statement 2 Making Materiality Judgements, to provide non-mandatory guidance on how
to apply the concept of materiality to accounting policy disclosures.
•
•
•
•
Except for the amendments to AASB Practice Statement 2 (which provide non-mandatory guidance and
therefore do not have an effective date), the amendments are effective for annual periods beginning on or
after 1 January 2023. The amendments to the individual Standards may be applied early, separately from the
amendments to the other Standards, where feasible.
The directors of the Company do not anticipate that the amendments will have a material impact on the Group
but may change the disclosure of accounting policies included in the financial statements.
Summary of accounting policies
3
3.1 Overall considerations
The significant accounting policies that have been used in the preparation of these financial statements are
summarised below.
The financial statements have been prepared using the measurement bases specified by Australian Accounting
Standards for each type of asset, liability, income and expense. The measurement bases are more fully
described in the accounting policies below.
Manuka Resources Ltd
For the year ended 30 June 2022
41
The financial statements have been prepared on a historical cost basis, except for the assets held for sale which
are measured at fair value less cost of disposal. The financial statements are presented in Australian dollars
which is the Company’s functional and presentation currency.
3.2 Going Concern
The financial report has been prepared on a going concern basis, which contemplates continuity of normal
business activities and realisation of assets and settlement of liabilities in the ordinary course of business. The
financial statements do not include any adjustments that might be necessary to realise its assets and discharge
its liabilities in the normal course of business, and at the amounts stated in the financial report, should the
Group not be able to continue as a going concern.
During the financial year ended 30 June 2022, the Group generated operating profit of $5,281,420 and positive
operating cash flows of $8,351,246, primarily driven by strong operating results from Mt Boppy. Debt
repayments of $2,998,302 ($US2,000,000) were made using these proceeds and the Group was also successful
in raising $5,000,000 in equity in March 2022 in order to fund the Company’s transition to silver production
from Wonawinta.
Notwithstanding, at 30 June 2022 the Group had $1.16m of cash on hand and remained in a net current liability
position of $14,674,402, due primarily to $13,098,931 in current debt. Subsequent to year end, this liability
has been successfully extended to 30 September 2023, however this remains due 12 months from the date of
this report. In the period since 30 June 2022, the Group has been managing its cash position through sales of
silver ores, negotiated deferral of creditor payment terms and utilisation of existing working capital facility.
The Directors, in their consideration of the appropriateness of the going concern basis for the preparation of
the financial statements, have prepared cash flow projections for the period to 30 September 2023 and 31
December 2023 that supports the ability of the Group to continue as a going concern over the coming 12 to
18 month period. However, in order to repay its current liabilities in the timeframe required, these projections
rely on the following:
•
•
•
•
The ability of the Group to continue gold and silver production profitably from both Wonawinta and Mt
Boppy, based on the forecast gold and silver prices, the cut-off grade, and the planned recoveries from
known resources and stockpiles. Current forecasts assume a silver price of US$19.50/oz, a gold price of
US$1,720/oz and an exchange rate of AUD/USD of $0.67.
The ability to obtain additional financing through additional debt placements or through the capital
raising activities in the market to fund further mining from Mt Boppy and meet other short term
creditor, working capital and interest obligations.
The ability to renegotiate with TransAsia Private Capital Limited (“TPC”) the terms of the facility beyond
30 September 2023 (if required) and/or finding alternative financing arrangements, if required based
on the timing of cash receipts from gold and silver production.
The ability to repay current creditors through profits from silver mining or to successfully negotiate
payment extensions with long dated creditors. Alternatively, further short-term financing may be
required to manage short term cash flow.
Should the Group be unsuccessful in achieving the matters set out above, a material uncertainty would exist
that may cast significant doubt on the ability of the Group to continue as a going concern, and therefore,
whether it will realise its assets and extinguish its liabilities in the ordinary course of business.
Manuka Resources Ltd
For the year ended 30 June 2022
42
The Directors are confident that the above steps can be achieved based on:
•
History of being able to successfully extend the current debt facilities, noting the facility with TransAsia
Private Capital Limited (as disclosed in note 20.2) has been successfully extended twice to date;
Track record of successfully raising funds in the market as required to fund mining activities including
$7,000,000 in December 2020 and $5,000,000 in March 2022;
Ability to achieve significant profits from Mt Boppy in the 30 June 2022 fiscal year and the continued
high gold prices.
•
•
At the date of signing this report, the Directors have reasonable grounds to believe that due to the matters
noted above and the actions taken that it is appropriate to prepare the financial statements on the going
concern basis.
3.3 Basis of consolidation
The Group’s financial statements consolidate those of the Parent Company and all of its subsidiaries at the
end of the reporting period. The parent controls a subsidiary if it is exposed, or has rights, to variable returns
from its involvement with the subsidiary and has the ability to affect those returns through its power over the
subsidiary. All subsidiaries have a reporting date of 30 June.
All transactions and balances between Group companies are eliminated on consolidation, including unrealised
gains and losses on transactions between Group companies. Where unrealised losses on intra-group asset
sales are reversed on consolidation, the underlying asset is also tested for impairment from a group
perspective. Amounts reported in the financial statements of subsidiaries have been adjusted where necessary
to ensure consistency with the accounting policies adopted by the Group.
Profit or loss and other comprehensive income of subsidiaries acquired or disposed of during the year are
recognised from the date on which control is transferred to the Group, or up to the date that control ceases.
3.4 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. (Refer
Note 5)
3.5 Foreign currency translation
Functional and presentation currency
Items included in the financial statements of each of the Group’s entities are measured using the currency of
the primary economic environment in which the entity operates (‘the functional currency’). The consolidated
financial statements are presented in Australian dollars, which is Manuka Resources Limited's functional and
presentation currency.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing
at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such
transactions and from the translation at year end exchange rates of monetary assets and liabilities
denominated in foreign currencies are recognised in profit or loss. They are deferred in equity if they are
attributable to part of the net investment in a foreign operation.
Foreign exchange gains and losses are presented in the statement of profit or loss on a net basis within other
gains/(losses).
Manuka Resources Ltd
For the year ended 30 June 2022
43
Income taxes
3.6
Tax expense recognised in profit or loss comprises the sum of deferred tax and current tax not recognised in
other comprehensive income or directly in equity.
Current income tax assets and/or liabilities comprise those obligations to, or claims from, the Australian
Taxation Office (ATO) and other fiscal authorities relating to the current or prior reporting periods that are
unpaid at the reporting date. Current tax is payable on taxable profit, which differs from profit or loss in the
financial statements. Calculation of current tax is based on tax rates and tax laws that have been enacted or
substantively enacted by the end of the reporting period.
Deferred income taxes are calculated using the liability method on temporary differences between the
carrying amounts of assets and liabilities and their tax bases. However, deferred tax is not provided on the
initial recognition of goodwill or on the initial recognition of an asset or liability unless the related transaction
is a business combination or affects tax or accounting profit. Deferred tax on temporary differences associated
with investments in subsidiaries and joint ventures is not provided if reversal of these temporary differences
can be controlled by the Company and it is probable that reversal will not occur in the foreseeable future.
Deferred tax assets and liabilities are calculated, without discounting, at tax rates that are expected to apply
to their respective period of realisation, provided they are enacted or substantively enacted by the end of the
reporting period.
Deferred tax assets are recognised to the extent that it is probable that they will be able to be utilised against
future taxable income. Deferred tax liabilities are always provided for in full.
Deferred tax assets and liabilities are offset only when the Company has a right and intention to set off
current tax assets and liabilities from the same taxation authority.
Changes in deferred tax assets or liabilities are recognised as a component of tax income or expense in profit
or loss, except where they relate to items that are recognised in other comprehensive income (such as the
revaluation of land) or directly in equity, in which case the related deferred tax is also recognised in other
comprehensive income or equity, respectively.
3.7 Leases
At the date of commencement of the lease, the Group recognises lease liabilities measured at the present
value of lease payments to be made over the lease term. The lease payments include fixed payments (and, if
applicable, in-substance fixed payments) less any lease incentives receivable, variable lease payments that
depend on an index or a rate, and amounts expected to be paid under residual value guarantees. The lease
payments also include the exercise price of a purchase option reasonably certain to be exercised by the Group
and payments of penalties for terminating the lease, if the lease term reflects the Group exercising the option
to terminate. Variable lease payments that do not depend on an index or a rate are recognised as expenses
(unless they are incurred to produce inventories) in the period in which the event or condition that triggers
the payment occurs.
In calculating the present value of lease payments, the Group uses its incremental borrowing rate at the lease
commencement date because the interest rate implicit in the lease is generally not readily determinable. After
the commencement date, the amount of lease liabilities is increased to reflect the accretion of interest and
reduced for the lease payments made. In addition, the carrying amount of lease liabilities is remeasured if
there is a modification, a change in the lease term, a change in the lease payments (e.g., changes to future
payments resulting from a change in an index or rate used to determine such lease payments) or a change in
Manuka Resources Ltd
For the year ended 30 June 2022
44
the assessment of an option to purchase the underlying asset. The Group’s lease liabilities are included in
Interest-bearing loans and borrowings (refer Note 20.1).
Short-term leases and leases of low value assets
The Group applies the short-term lease recognition exemption to its short-term leases of machinery (i.e. those
leases that have a lease term of 12 months of less from the commencement date and do not contain a
purchase option). The Group recognises the lease payments associated with these leases as an expense on a
straight-line basis over the lease term.
3.8 Revenue recognition
The Group recognises revenue as follows:
Revenue from contracts with customers
Revenue is recognised at an amount that reflects the consideration to which the Company is expected to be
entitled in exchange for transferring goods or services to a customer. For each contract with a customer, the
Company: identifies the contract with a customer; identifies the performance obligations in the contract;
determines the transaction price which takes into account estimates of variable consideration and the time
value of money; allocates the transaction price to the separate performance obligations on the basis of the
relative stand-alone selling price of each distinct good or service to be delivered; and recognises revenue when
or as each performance obligation is satisfied in a manner that depicts the transfer to the customer of the
goods or services promised.
Variable consideration within the transaction price, if any, reflects concessions provided to the customer such
as discounts, rebates and refunds, any potential bonuses receivable from the customer and any other
contingent events. Such estimates are determined using either the 'expected value' or 'most likely amount'
method. The measurement of variable consideration is subject to a constraining principle whereby revenue
will only be recognised to the extent that it is highly probable that a significant reversal in the amount of
cumulative revenue recognised will not occur. The measurement constraint continues until the uncertainty
associated with the variable consideration is subsequently resolved. Amounts received that are subject to the
constraining principle are initially recognised as deferred revenue in the form of a separate refund liability.
Sale of goods
Revenue from the sale of goods is recognised at the point in time when the customer obtains control of the
goods, which is generally at the time of delivery. The Company has one Key Customer which is a London Bullion
Market Association (LBMA) Accredited Refinery. Sales revenue is recognised at the time of the Lock-in
Contract. This is when goods are delivered and title and risk passes to the customer.
3.9 Government grants
Grants from the government are recognised at their fair value where there is a reasonable assurance that the
grant will be received, and the Group will comply with all attached conditions. Government grants are
recorded in other income.
3.10 Operating expenses
Operating expenses are recognised in profit or loss upon utilisation of the service.
Manuka Resources Ltd
For the year ended 30 June 2022
45
3.11 Exploration and evaluation expenditure
Exploration and evaluation 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 or loss 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 transferred to mine
properties and amortised over the life of the area according to the rate of depletion of the economically
recoverable reserves.
Costs of site restoration are provided over the life of the facility from when exploration commences and are
included in the costs of that stage. Site restoration costs include the dismantling and removal of mining plant,
equipment and building structures, waste removal, and rehabilitation of the site in accordance with clauses of
the mining permits. Such costs have been determined using estimates of future costs, current legal
requirements and technology on a discounted basis.
Any changes in the estimates for the costs are accounted on a prospective basis. In determining the costs of
site restoration, there is uncertainty regarding the nature and extent of the restoration due to community
expectations and future legislation. Accordingly, the costs have been determined on the basis that the
restoration will be completed within one year of abandoning the site. A regular review for impairment is
undertaken of each area of interest to determine the appropriateness of continuing to carry forward costs in
relation to that area of interest. Exploration expenditure which fails to meet at least one of the conditions
outlined above is written off.
3.12 Property, plant and equipment
Property, plant, equipment, is stated at cost less accumulated depreciation and any impairment in value.
Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate,
only when it is probable that future economic benefits associated with the item will flow to the Company and
the cost of the item can be measured reliably.
All other repairs and maintenance are charged to the income statement during the financial year in which they
are incurred.
Manuka Resources Ltd
For the year ended 30 June 2022
46
Depreciation commences on assets when it is deemed they are capable of operating in the manner intended.
Useful lives are examined on an annual basis and adjustments, where applicable, are made on a revised useful
life basis.
Asset
Freehold land – at cost
Computer Equipment:-
- Laptops and mobile devices
- Other Computer equipment
Plant and Equipment
Ball Mill Motor
Other Pumps and Motors
Generators
Other
Processing Plant
Depreciation rate
not depreciated
2 years effective life (50%) – diminishing value
4 years effective life (25%) - diminishing value
25 years effective life (4%) - diminishing value
20 years effective life (5%) - diminishing value
10 years effective life (10%) - diminishing value
2-5 years effective life (20% to 50%) - diminishing
value
units of production
The carrying values of plant and equipment are reviewed for impairment when events or changes in
circumstances indicate the carrying value may not be recoverable.
An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits
are expected to arise from the continued use of the asset. The gain or loss arising on the disposal or retirement
of an asset is determined as the difference between the sales proceeds and the carrying amount of the asset
and is recognised in profit or loss.
3.13 Financial instruments
Recognition and derecognition
Financial assets and financial liabilities are recognised when the Group becomes a party to the contractual
provisions of the financial instrument and are measured initially at fair value adjusted by transactions costs,
except for those carried at fair value through profit or loss, which are measured initially at fair value.
Subsequent measurement of financial assets and financial liabilities are described below.
Financial assets are derecognised when the contractual rights to the cash flows from the financial asset expire,
or when the financial asset and substantially all the risks and rewards are transferred. A financial liability is
derecognised when it is extinguished, discharged, cancelled, or expires.
Except for those trade receivables that do not contain a significant financing component and are measured at
the transaction price in accordance with AASB 15, all financial assets are initially measured at fair value
adjusted for transaction costs (where applicable).
Subsequent measurement of financial assets
For the purpose of subsequent measurement, financial assets, other than those designated and effective as
hedging instruments, are classified into the following categories upon initial recognition:
•
•
•
•
financial assets at amortised cost
financial assets at fair value through profit or loss (FVPL)
debt instruments at fair value through other comprehensive income (FVOCI)
equity instruments at fair value through other comprehensive income (FVOCI)
Manuka Resources Ltd
For the year ended 30 June 2022
47
Classifications are determined by both:
•
•
The entity’s business model for managing the financial asset
The contractual cash flow characteristics of the financial assets
All income and expenses relating to financial assets that are recognised in profit or loss are presented within
finance costs, finance income or other financial items, except for impairment of trade receivables which is
presented within other expenses.
Financial assets at amortised cost
Financial assets are measured at amortised cost if the assets meet the following conditions (and are not
designated as FVPL):
•
•
they are held within a business model whose objective is to hold the financial assets and collect its
contractual cash flows; and
the contractual terms of the financial assets give rise to cash flows that are solely payments of principal
and interest on the principal amount outstanding.
After initial recognition, these are measured at amortised cost using the effective interest method. Discounting
is omitted where the effect of discounting is immaterial. The Group’s cash and cash equivalents, trade and
most other receivables fall into this category of financial instruments.
Financial assets at fair value through profit or loss (FVPL)
Financial assets that are held within a business model other than ‘hold to collect’ or ‘hold to collect and sell’
are categorised at fair value through profit and loss. Further, irrespective of business model, financial assets
whose contractual cash flows are not solely payments of principal and interest are accounted for at FVPL. All
derivative financial instruments fall into this category, except for those designated and effective as hedging
instruments, for which the hedge accounting requirements apply.
Impairment of financial assets
The AASB 9 impairment model uses forward looking information to recognise expected credit losses - the
‘expected credit losses (ECL) model’. The application of this impairment model depends on whether there has
been a significant increase in credit risk.
The Group considers a broader range of information when assessing credit risk and measuring expected credit
losses, including past events, current conditions, reasonable and supportable forecasts that affect the
expected collectability of the future cash flows of the instrument.
In applying this forward-looking approach, a distinction is made between:
•
•
financial instruments that have not deteriorated significantly in credit quality since initial recognition or
that have low credit risk (‘Stage 1’); and
financial instruments that have deteriorated significantly in credit quality since initial recognition and
whose credit risk is not low (‘Stage 2’).
‘Stage 3’ would cover financial assets that have objective evidence of impairment at the reporting date. ‘12-
month expected credit losses’ are recognised for the first category while ‘lifetime expected credit losses’ are
recognised for the second category. Measurement of the expected credit losses is determined by a probability-
weighted estimate of credit losses over the expected life of the financial instrument.
Manuka Resources Ltd
For the year ended 30 June 2022
48
Trade and other receivables and contract assets
Trade receivables are amounts due from customers for goods sold or services performed in the ordinary
course of business. They are generally due for settlement within 30 days and therefore are all classified as
current. Trade receivables are recognised initially at the amount of consideration that is unconditional unless
they contain significant financing components, when they are recognised at fair value. The Group holds the
trade receivables with the objective to collect the contractual cash flows and therefore measures them
subsequently at amortised cost using the effective interest method.
The Group applies the AASB 9 simplified approach to measuring expected credit losses which uses a lifetime
expected loss allowance for all trade receivables. In determining the recoverability of a trade or other
receivables using the expected credit loss model, the Group performs a risk analysis considering the type and
age of the outstanding receivables, the creditworthiness of the counterparty, contract provisions, letter of
credit and timing of payment.
No provision for credit losses was required to be recognised in the current period ending 30 June 2022.
Classification and measurement of financial liabilities
The Group’s financial liabilities include trade and other payables, borrowings, lease liabilities and derivative
financial instruments.
Financial liabilities are initially measured at fair value, and, where applicable, adjusted for transaction costs
unless the Group designated a financial liability at fair value through profit or loss. Subsequently, financial
liabilities are measured at amortised cost using the effective interest method except for derivatives and
financial liabilities designated at FVPL, which are carried subsequently at fair value with gains or losses
recognised in profit or loss (other than derivative financial instruments that are designated and effective as
hedging instruments).
Foreign exchange gains and losses
For financial liabilities that are denominated in a foreign currency and are measured at amortised cost at the
end of each reporting period, the foreign exchange gains and losses are determined based on the amortised
cost of the instruments. Except for those foreign exchange gains and losses related to borrowings, foreign
exchange gains and losses are recognised in the ‘Other income’ or ‘Other losses’ line items in profit or loss for
financial liabilities that are not part of a designated hedging relationship. Foreign exchange gains and losses
related to borrowings are recognised in the ‘Finance Charges’ line item in profit or loss
The fair value of financial liabilities denominated in a foreign currency is determined in that foreign currency
and translated at the spot rate at the end of the reporting period. For financial liabilities that are measured as
at FVTPL, the foreign exchange component forms part of the fair value gains or losses and is recognised in
profit or loss for financial liabilities that are not part of a designated hedging relationship.
3.14 Inventories
Inventories are measured at the lower of their costs and net realisable value. An impairment provision is
recognised when there is objective evidence that the Company will not be able to realise the carrying amount
through use or sale.
Raw materials and stores, work in progress and finished goods are stated at the lower of cost and net realisable
value. Cost comprises direct materials, direct labour and an appropriate proportion of variable and fixed
overhead expenditure, the latter being allocated on the basis of normal operating capacity. Costs are assigned
to individual items of inventory on the basis of weighted average costs. Costs of purchased inventory are
determined after deducting rebates and discounts. Net realisable value is the estimated selling price in the
Manuka Resources Ltd
For the year ended 30 June 2022
49
ordinary course of business less the estimated costs of completion and the estimated costs necessary to make
the sale inventories are valued at the lower of cost and net realisable value.
3.15 Care and Maintenance
When a mine moves into the care and maintenance stage, the costs of maintaining the mine are expensed in
the period as incurred unless there are future economic benefits for other operating mines.
3.16 Mine development
Mine development expenditure relates to costs incurred to access a mineral resource. It represents those
exploration and evaluation costs incurred after the technical feasibility and commercial viability of extracting
the mineral resource has been demonstrated and an identified mineral reserve is being prepared for
production (but is not yet in production).
Significant factors considered in determining the technical feasibility and commercial viability of the project
are the completion of a feasibility study, the existence of sufficient proven and probable reserves to proceed
with development and approval by the Board of directors to proceed with development of the project. Mine
development costs include direct and indirect costs associated with mine infrastructure, pre-production
development costs, development excavation, project execution costs and other subsurface expenditure
pertaining to that area of interest. Costs related to tangible surface plant and equipment and any associated
land and buildings are accounted for as property, plant and equipment.
Development costs are carried forward in respect of areas of interest in the development phase until
commercial production commences. When commercial production commences, carried forward development
costs are transferred to Mine Properties and amortised on a units of production basis over the life of
economically recoverable reserves of the area of interest. Development assets are assessed for impairment if
an impairment trigger is identified. For the purposes of impairment testing, development assets are allocated
to CGUs to which the development activity relates.
3.17 Cash and cash equivalents
For the purposes of the statement of cash flows, cash and cash equivalents includes cash on hand and at bank,
deposits held at call with financial institutions, other short term, highly liquid investments with 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.
3.18 Borrowings
Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently
measured at amortised cost. Any difference between the proceeds (net of transaction costs) and the
redemption amount is recognised in profit or loss over the period of the borrowings using the effective interest
method. Fees paid on the establishment of loan facilities are recognised as transaction costs of the loan to the
extent that it is probable that some or all of the facility will be drawn down. In this case, the fee is deferred
until the draw-down occurs. To the extent there is no evidence that it is probable that some or all of the facility
will be drawn down, the fee is capitalised as a prepayment for liquidity services and amortised over the period
of the facility to which it relates.
Borrowings are removed from the balance sheet when the obligation specified in the contract is discharged,
cancelled or expired. The difference between the carrying amount of a financial liability that has been
extinguished or transferred to another party and the consideration paid, including any non-cash assets
transferred or liabilities assumed, is recognised in profit or loss as other income or finance costs.
Manuka Resources Ltd
For the year ended 30 June 2022
50
Where the terms of a financial liability are renegotiated and the entity issues equity instruments to a creditor
to extinguish all or part of the liability (debt for equity swap), a gain or loss is recognised in profit or loss, which
is measured as the difference between the carrying amount of the financial liability and the fair value of the
equity instruments issued.
Borrowings are classified as current liabilities unless the group has an unconditional right to defer settlement
of the liability for at least 12 months after the reporting period.
3.19 Borrowing costs
General and specific borrowing costs that are directly attributable to the acquisition, construction or
production of a qualifying asset are capitalised during the period of time that is required to complete and
prepare the asset for its intended use or sale. Qualifying assets are assets that necessarily take a substantial
period of time to get ready for their intended use or sale.
Other borrowing costs are expensed in the period in which they are incurred.
3.20 Derivatives
Derivatives are initially recognised at fair value on the date a derivative contract is entered into, and they are
subsequently remeasured to their fair value at the end of each reporting period. Changes in the fair value of
derivatives are recognised immediately in profit or loss and are included in other gains/(losses) except where
hedge accounting applies.
Derivative financial instruments and hedge accounting
Derivative financial instruments are accounted for at FVTPL except for derivatives designated as hedging
instruments in cash flow hedge relationships, which require a specific accounting treatment. To qualify for
hedge accounting, the hedging relationship must meet all of the following requirements:
•
•
•
there is an economic relationship between the hedged item and the hedging instrument
the effect of credit risk does not dominate the value changes that result from that economic
relationship, and
the hedge ratio of the hedging relationship is the same as that resulting from the quantity of the hedged
item that the entity actually hedges and the quantity of the hedging instrument that the entity actually
uses to hedge that quantity of hedged item.
For the reporting periods under review, the Group has designated certain gold swap and spot contracts as
hedging instruments in cash flow hedge relationships. Where appropriate, these arrangements have been
entered into to mitigate short-term commodity price impacts arising from certain highly probable sales
transactions and to give certainty to exchange rate and commodity price impacts on the realised sales prices
of the Commodities produced by the Group.
All derivative financial instruments used for hedge accounting are recognised initially at fair value and reported
subsequently at fair value in the consolidated statement of financial position.
To the extent that the hedge is effective, changes in the fair value of derivatives designated as hedging
instruments in cash flow hedges are recognised in other comprehensive income and included within the cash
flow hedge reserve in equity. Any ineffectiveness in the hedge relationship is recognised immediately in profit
or loss.
Manuka Resources Ltd
For the year ended 30 June 2022
51
At the time the hedged item affects profit or loss, any gain or loss previously recognised in other
comprehensive income is reclassified from equity to profit or loss and presented as a reclassification
adjustment within other comprehensive income. However, if a non-financial asset or liability is recognised as
a result of the hedged transaction, the gains and losses previously recognised in other comprehensive income
are included in the initial measurement of the hedged item.
If a forecast transaction is no longer expected to occur, any related gain or loss recognised in other
comprehensive income is transferred immediately to profit or loss. If the hedging relationship ceases to meet
the effectiveness conditions, hedge accounting is discontinued and the related gain or loss is held in the equity
reserve until the forecast transaction occurs.
3.21 Employee benefits
Short-term obligations
Liabilities for wages and salaries, including non-monetary benefits, and annual leave expected to be settled
within 12 months of the reporting date are recognised in other payables in respect of employees’ services up
to the reporting date and are measured at the amounts expected to be paid when the liabilities are settled.
Other long-term employee benefit obligations
The Group also has liabilities for long service leave that are not expected to be settled wholly within 12 months
after the end of the period in which the employees render the related service. These obligations are therefore
measured as the present value of expected future payments to be made in respect of services provided by
employees up to the end of the reporting period using the projected unit credit method. Consideration is given
to expected future wage and salary levels, experience of employee departures and periods of service.
Expected future payments are discounted using market yields at the end of the reporting period of high-quality
corporate bonds with terms that match, as closely as possible, the estimated future cash outflows.
Remeasurements as a result of experience adjustments and changes in actuarial assumptions are recognised
in profit or loss.
The obligations are presented as current liabilities in the balance sheet if the Group does not have an
unconditional right to defer settlement for at least twelve months after the reporting period, regardless of
when the actual settlement is expected to occur.
Share based payments
Options over ordinary shares have been granted to employees, Directors and finance providers from time to
time, on a discretionary basis. The cost of these share-based payments is measured by reference to the fair
value at the date at which they are granted using an option pricing model. The options may be subject to
service or other vesting conditions and their fair value is recognised as an expense together with a
corresponding increase in other reserve equity over the vesting period.
3.22 Equity, reserves and dividend payments
Share capital represents the fair value of shares that have been issued. Any transaction costs associated with
the issuing of shares are deducted from share capital, net of any related income tax benefits.
Other components of equity include the following:
•
Share based payment reserve – comprising assessed fair value of options issued to employees,
executives and other parties
Reserve for cash flow hedges – comprising gains and losses relating to these types of financial
instruments
•
Manuka Resources Ltd
For the year ended 30 June 2022
52
Retained earnings include all current and prior period retained profits.
Dividend distributions payable to equity shareholders are included in other liabilities if the dividends have
been being appropriately authorised and are no longer at the discretion of the entity prior to the reporting
date.
All transactions with owners of the parent are recorded separately within equity.
3.23 Earnings per share
Basic earnings per share
Basic earnings per share is calculated by dividing the profit attributable to owners of the Company, 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 adjusts 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 shares assumed to have been issued for no consideration
in relation to dilutive potential ordinary shares.
3.24 Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST
incurred is not recoverable from the taxation authority. In these circumstances the GST is recognised as part
of the cost of acquisition of the asset or as part of an item of the expense. Receivables and payables in the
statement of financial position are shown inclusive of GST.
The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables
or payables.
Cash flows are included in the cash flow statement on a gross basis. The GST component of cash flows arising
from investing and financing activities which is recoverable from, or payable to, the taxation authority is
classified within operating cash flows.
3.25 Rehabilitation
Provisions made for rehabilitation are recognised where there is a present obligation as a result of exploration,
development or production activities having been undertaken, and it is probable that an outflow of economic
benefits will be required to settle the obligation. The estimated future obligations include the costs of
removing facilities, abandoning mining activities and restoring the affected areas. The provision for future
rehabilitation costs is the best estimate of the present value of the expenditure required to settle the
obligation at the reporting date, based on current legal requirements and technology. Future rehabilitation
costs are reviewed annually, and any changes are reflected in the present value of the rehabilitation provision
at the end of the reporting period. The amount of the provision for future rehabilitation costs relating to
exploration and development activities is capitalised as a cost of those activities. If the effect is material,
provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current
market assessments of the time value of money, and where appropriate the risks specific to the liability.
Manuka Resources Ltd
For the year ended 30 June 2022
53
3.26 Significant management judgement in applying accounting policies and estimation
uncertainty
When preparing the financial statements, management undertakes a number of judgements, estimates and
assumptions about the recognition and measurement of assets, liabilities, income and expenses.
Determination of cash generating unit (CGU) and assessment of impairment
The Group assesses each Cash-Generating Unit (CGU), at each reporting period to determine whether there is
any indication of impairment or reversal. Indicators reviewed include, but are not limited to, operating
performance of the CGU, future business plans, assumptions around future commodity prices, exchange rates,
production rates and production costs. Where an indicator of impairment or reversal exists, a formal estimate
of the recoverable amount is made. Where the carrying amount of an asset of CGU exceeds its recoverable
amount, the carrying amount is reduced to the recoverable amount and the impairment would be recognised
in the Statement of Profit or Loss.
The Group considers that there is a single CGU, being the Wonawinta Plant after considering the following:
•
Cash inflows result only from the sale of the final Doré produced by the Wonawinta processing plant
after inputs are processed from the either the Mt Boppy mine or the Wonawinta Silver Project.
There is no active market for the unprocessed ores at the Mt Boppy mine or the Wonawinta Silver
Project and cash flows are dependent on processing at the Wonawinta plant.
•
Rehabilitation provision
The Company is required by the relevant regulatory authorities to ensure that appropriate rehabilitation is
carried out on tenements that are mined. The amount of the rehabilitation cost is an estimate based upon the
estimated life of each mined tenement, as well as the future timing and cost of such rehabilitation. The
provision is constantly revised as information about the life of mine, depth of mining, level of ground
disturbance and cost estimates are updated.
Share based payment reserve
Management uses valuation techniques to determine the fair value of the reserve created when options are
issued to employees and executives. This involves developing estimates and assumptions determined by
reference to historical data of either the Company or of comparable entities over a period of time where
applicable (e.g. historical volatility data of comparable entities has been considered where there was
insufficient historical volatility information for the Company). Management bases its assumptions on
observable data as far as possible, but this is not always available. In that case management uses the best
information available.
Exploration and evaluation costs
Exploration and evaluation costs have been capitalised and 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. Key judgements are applied in considering the costs to be capitalised which includes determining
expenditures directly related to these activities and allocating overheads between those that are expensed
and capitalised.
Net realisable value of inventories
The calculation of net realisable value for raw materials, work in progress and finished goods involves
significant judgement and estimates in relation to timing and cost of processing, commodity prices, recoveries.
A change in any of these assumptions will alter the estimated net realisable value and may therefore impact
the carrying value of inventories.
Manuka Resources Ltd
For the year ended 30 June 2022
54
Determination of mineral resources and ore reserves
The Group reports its Mineral Resources and Ore Reserves in accordance with the Joint Ore Reserves
Committee (JORC) Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore
Reserves (JORC Code). The information on Mineral Resources and Ore Reserves is prepared by Competent
Persons as defined by the JORC Code.
There are numerous uncertainties inherent in estimating the quantities of economically recoverable Mineral
Resources and Ore Reserves. Assumptions that are valid at the time of estimation may change significantly
when new information becomes available.
Changes in the forecast prices of commodities, exchange rates, production costs or recovery rates may change
the economic status of reserves and may, ultimately, result in the reserves being restated. Such changes may
impact asset carrying values, depreciation and amortisation rates, deferred development costs and provisions
for rehabilitation.
4
Correction of prior period errors
During the reporting period, the following matters relating to prior reporting periods came to the Company’s
attention and have been treated as corrections to the prior period financial statements
(a) Rehabilitation Liability (Provisions)
In prior periods, all rehabilitation liability movements were being recorded though the statement of other
comprehensive income as finance expenses, rather than as an adjustment to mineral properties (rehabilitation
asset). Only the unwind of the discount on the provision should have been recorded through finance expense.
(b) Environmental Bonds (Financial Assets)
In prior periods the environmental bonds were being fair valued rather than recorded at amortised cost. This
resulted in a change in the method in which the carrying value has been calculated each period.
(c) Development Assets (Mine Properties and Development Assets)
In prior periods, Development Assets included items of Plant and Equipment. These items (together with the
corresponding accumulated depreciation) have been reclassified.
The impact that these matters have on the prior period figures as follows:
Property,
Impact on Statement of
Plant and
Financial Position
Equipment
Financial
assets
Provisions
Mine
Properties/
Development
assets
Accumulated
Depreciation
Accumulated
losses
30 June 2020
adjustment
5,296,775
6,456,370
9,343,296
8,798,735
(209,716)
(17,912,252)
1,930,662
668,408
(191,622)
2,285,467
(163,183)
668,408
Restated 1 July 2020
7,227,437
7,124,778
9,151,674
11,084,202
(372,899)
(17,243,844)
30 June 2021
Adjustment
6,377,651
6,888,571
6,439,546
11,147,702
(1,057,071)
(20,807,496)
1,540,305
259,413
(351,918)
2,285,467
(163,183)
489,475
Restated 30 June 2021
7,917,956
7,147,984
6,087,628
13,433,169
(1,220,254)
(20,318,021)
The impact of the above matters on the statement of comprehensive income for the comparative period,
being 30 June 2021, was a decrease of $178,933.
Manuka Resources Ltd
For the year ended 30 June 2022
55
Segment reporting
5
Identification of reportable segments
The Group has identified operating segments based on the internal reports that are reviewed and used by the
board of directors (chief operating decision makers) in assessing performance and determining the allocation
of resources. Currently all the Group’s gold and silver tenements and resources are in New South Wales.
Two operating segments have been identified:
• Exploration: Exploration of existing gold leases and exploration leases at Wonawinta and Mt Boppy
projects
• Operations: being the administration, appraisal, development and processing of gold and silver
deposits including head office expenses
The following table presents revenue and loss information regarding operating segments for the years ended
30 June 2022 and 30 June 2021 (restated).
Year ended 30 June 2022
Exploration
Operations
Segment revenue (external customers)
Segment cost of sales
Segment operating contribution
Other income
Expenses
Share based payments
Foreign exchange gains / losses
Finance income / (expenses)
Profit / (loss) before income tax
-
-
-
-
(27,724)
-
-
-
(27,724)
53,271,499
(41,244,405)
12,027,094
304,621
(2,512,355)
(69,718)
(1,025,343)
(3,415,155)
5,309,144
Year ended 30 June 2021 restated
Exploration
Operations
Total
$
53,271,499
(41,244,405)
12,027,094
304,621
(2,540,079)
(69,718)
(1,025,343)
(3,415,155)
5,281,420
Total
$
Segment revenue (external customers)
Segment cost of sales
Segment operating contribution
Other income
Expenses
Foreign exchange gains / (losses)
Finance income / (expenses)
Loss before income tax
-
-
-
-
43,752,567
(43,312,892)
43,752,567
(43,312,892)
439,675
791,888
(23,677)
(2,363,355)
(499)
(24,176)
1,721,880
(3,640,089)
(3,050,001)
439,675
791,888
(2,387,032)
1,721,880
(3,640,588)
(3,074,177)
Manuka Resources Ltd
For the year ended 30 June 2022
56
The following table presents segment assets and liabilities of operating segments at 30 June 2022 and 30
June 2021 (restated).
Segment Assets
Exploration
Operations
Total
$
As at 30 June 2022
8,457,839
33,138,678
41,596,517
Restated as at 30 June 2021
4,780,492
32,494,664
37,275,156
Segment Liabilities
Exploration
Operations
Total
$
As at 30 June 2022
115,800
27,906,951
28,022,751
Restated as at 30 June 2021
317,125
34,283,919
34,601,044
Revenue and assets by geographical region
The Company's revenue is derived from sources and assets located wholly within Australia.
Major customers
The Company currently delivers all its product to one off-taker.
Financial information
Reportable items required to be disclosed in this note are consistent with the information disclosed in the
Statement of Profit or Loss and Other Comprehensive Income and Statement of Financial Position and are not
duplicated here.
6
Revenue and other income
(a) Operating sales revenue
Sale of mineralised ore – gold
Sale of mineralised ore – silver
Total revenue from contracts with customers
(b) Other income
Government grant - Jobkeeper
Income from cash settled hedges
Other income
Total other income
Notes
20.4
30 June
2022
$
30 June
2021
$
49,308,178
3,963,321
53,271,499
42,993,529
759,038
43,752,567
-
58,272
246,349
304,621
463,500
248,454
79,934
791,888
Manuka Resources Ltd
For the year ended 30 June 2022
57
7
Expenses
(a) Cost of sales
Operating expenses
Royalties
Inventory movements
Total operating expenses
(b) Operating expenses
Mining expenses
Hauling and crushing expenses
Processing and refining expenses
Site administration expenses
Amortisation of mine properties
Total operating expenses
(c) Other expenses
Professional expenses
Employment expenses
Depreciation
Other expenses
Total other expenses
(d) Employment Expenses
Wages and Salaries
Superannuation
Employment taxes
(e) Share based payments
Director options
7(b)
30 June
2022
$
37,622,448
1,388,891
2,233,066
30 June
2021
$
43,610,478
1,996,666
(2,294,252)
41,244,405
43,312,892
30 June
2022
$
4,299,060
30 June
2021
$
9,038,681
8,680,972
10,042,536
18,200,370
15,422,039
5,114,513
4,889,892
16
1,327,533
4,217,330
37,622,448
43,610,478
7(d)
30 June
2022
$
880,900
1,105,731
115,529
437,919
30 June
2021
$
963,558
904,632
56,142
462,700
2,540,079
2,387,032
30 June
2022
$
990,066
75,625
40,040
1,105,731
30 June
2022
$
69,718
30 June
2021
$
768,112
66,293
70,227
904,632
30 June
2021
$
-
Manuka Resources Ltd
For the year ended 30 June 2022
58
(f) Foreign exchange (gains) and losses
Realised foreign exchange (gains)
Unrealised foreign exchange (gains) / losses
Total foreign exchange (gains) / losses
8
Finance costs
Finance costs are made up of the following items:
Interest expenses and other finance charges – net of capitalisation of
borrowing costs
Discounting impact of rehabilitation provisions
Discounting impact of financial assets
Accrued interest charged to notes
Total finance costs
9
Income tax expense
(a) Income tax benefit recognised in the income statement
Current tax
Deferred tax
Income tax as reported in the statement of comprehensive income
(b) Reconciliation of income tax expense to prima facie tax payable
The prima facie income tax expense on pre-tax accounting loss from
operations reconciles to the income tax expense in the financial
statements as follows:
Profit / (loss) from ordinary activities before income tax expense
Tax at the Australian rate of 30% (2021 : 26%)
Increase / (decrease) in income tax due to:
Temporary differences
Permanent differences
Unused tax losses not recognised
Income tax expense
(c) Deferred tax assets not recognised
Deferred tax assets
- carry forward tax losses at 30% (2021: 26%) not recognised
- other deferred tax assets
Deferred tax liabilities
Net deferred tax assets not recognised
30 June
2022
$
(173,122)
1,198,465
1,025,343
30 June
2022
$
3,030,154
451,353
(66,352)
-
3,415,155
30 June
2021
$
-
(1,721,880)
(1,721,880)
Restated
30 June
2021
$
3,659,157
305,544
(343,751)
19,638
3,640,588
30 June
2022
Restated
30 June
2021
$
-
-
-
$
-
-
-
5,281,420
1,584,426
(3,074,177)
(799,286)
(2,138,201)
(1,083,700)
28,796
524,979
-
845,460
1,037,525
-
8,271,289
1,442,678
6,713,468
548,773
(5,991,788)
(2,683,114)
3,722,179
4,579,126
Manuka Resources Ltd
For the year ended 30 June 2022
59
The Company has no available franking credits.
Potential deferred tax assets attributable to tax losses and other temporary differences have not been brought
to account as at 30 June 2022. Because the directors do not believe it is appropriate to regard realisation of
the deferred tax assets as probable at this point in time. These benefits will be obtained if:
•
The Company derives future assessable income of a nature and an amount sufficient to enable the
benefit from the deductions for the expenditure to be realised; and
No changes in tax legislation adversely affect the Company in realising the benefit from the deductions
for the expenditure.
•
10 Auditor remuneration
During the year the following fees were paid or payable for services provided by the auditor of the parent
entity, its related practices and non-related audit firms:
Audit of financial statements
Grant Thornton – audit and review of financial reports
Ernst & Young – audit and review of financial reports
Remuneration from audit of financial statements
Other services – Grant Thornton
Total other services remuneration
Total auditor’s remuneration
30 June
2022
$
-
149,640
149,640
3,000
3,000
152,640
30 June
2021
$
143,500
-
143,500
-
-
143,500
11 Dividends
No dividends for the year ended 30 June 2022 have been declared or paid to shareholders by the Company.
12 Cash and cash equivalents
Cash and cash equivalents comprise the following:
Cash at bank and in hand
Cash and cash equivalents as shown in the statement of
financial position and the statement of cash flows
Cash at bank and in hand is non-interest bearing.
13 Trade and other receivables
Current
Trade receivables
Other receivables
Total trade and other receivables
30 June
2022
$
30 June
2021
$
1,160,615
1,018,035
1,160,615
1,018,035
30 June
2022
$
50,600
379,982
430,582
30 June
2021
$
355,290
338,281
693,571
Manuka Resources Ltd
For the year ended 30 June 2022
60
14 Prepayments
Prepayments consist of the following:
Current prepaid insurances
Other prepayments
Prepayments at cost
15
Inventories
Consumables, supplies and spares
Gold concentrate in circuit at cost
Ore stockpiles
Inventories at cost
16 Development assets and mine properties
Development assets at cost
Rehabilitation cost estimates
Accumulated amortisation
Net carrying amount
Mine properties at cost
Rehabilitation cost estimates
Accumulated amortisation
Net carrying amount
Total development assets and mine properties at cost
Rehabilitation cost estimates
Accumulated amortisation
Total net carrying amount
30 June
2022
$
684,625
85,927
770,552
30 June
2022
$
1,108,498
1,759,657
20,968
2,889,123
30 June
2022
$
197,500
-
(14,733)
182,767
30 June
2021
$
531,335
38,292
569,627
30 June
2021
$
667,383
2,882,813
1,142,091
4,692,287
Restated
30 June
2021
$
1,220,200
(214,850)
-
1,005,350
10,194,875
1,387,287
8,665,958
1,452,649
(6,349,129)
(5,036,329)
5,233,033
5,082,278
10,392,375
1,387,287
(6,363,862)
5,415,800
9,886,158
1,237,799
(5,036,329)
6,087,628
Manuka Resources Ltd
For the year ended 30 June 2022
61
The following tables show the movements in development assets and mine properties:
Development assets
Opening carrying value
Additions at cost
Transfer to mine properties
Adjustment to rehabilitation cost estimates
Amortisation charge for the year
Closing carrying value net of accumulated amortisation
Mine properties
Opening carrying value
Additions at cost
Transfer from development assets
Adjustment to rehabilitation cost estimates
Amortisation charge for the year
Closing carrying value net of accumulated amortisation
Total development assets and mine properties at cost
Opening carrying value
Additions at cost
Adjustment to rehabilitation cost estimates
Amortisation charge for the year
Total closing carrying value net of accumulated amortisation
30 June
2022
$
1,005,350
-
(1,022,700)
214,850
(14,733)
182,767
5,082,278
506,217
1,022,700
(65,362)
Restated
30 June
2021
$
460,919
759,281
-
(214,850)
-
1,005,350
8,690,755
208,777
-
400,076
(1,312,800)
(4,217,330)
5,233,033
5,082,278
6,087,628
9,151,674
506,217
149,488
753,208
400,076
(1,327,533)
(4,217,330)
5,415,800
6,087,628
17 Exploration and evaluation assets
Exploration and evaluation costs carried forward in respect of areas of interest:
30 June
2022
Exploration assets
Opening net book amount
Exploration and evaluation costs during the year
Net book value
$
4,780,492
3,677,347
8,457,839
30 June
2021
$
322,305
4,458,187
4,780,492
During the period, the Company undertook the following activities as part of the follow-up-phase
exploration on the Company’s regional exploration tenements25:
(a) Drilling for resource extensions of the Mt Boppy pit which have comprised most of the Company’s field
work this period and which were impacted by both wet weather and challenging ground conditions,
requiring careful management of the drill program. Programs were put on hold due to adverse weather
impacts with rig remobilisation expected later in the 2022 calendar year;
(b) Phase one of a three stage ground gravity survey over ML1659 was completed in June with subsequent
data interpretation defining additional sulphide targets (co-incident with elevated Pb and Zn grades from
the 2021 Wonawinta Deeps program) which the Company will follow up in due course when rigs are
mobilised on the ML.
25 Refer ASX announcement dated 29 July 2022
Manuka Resources Ltd
For the year ended 30 June 2022
62
(c) Sampling of stockpiles on the Wonawinta ROM continued with over 500 samples submitted to the site
laboratory for analysis
An updated Mt Boppy Mineral Resources Estimate was released to the market 29 July 202226.
18 Property, plant and equipment
The following tables show the movements in property, plant and equipment:
Land
IT Equipment
Plant &
Equipment
Fixtures &
Fittings
$
$
$
$
Motor
Vehicles
$
Total
$
Restated
Year ended 30 June 2021
Opening net book value
Additions
Depreciation
754,994
0
0
29,295
35,896
9,626,023
2,122,814
(39,518)
(753,926)
Closing net book value
754,994
25,673
10,994,911
11,650
13,829
(4,578)
20,901
289,341
176,427
10,711,303
2,348,967
(49,332)
(847,354)
416,437
12,212,916
Restated
Balance 30 June 2021
Cost
Depreciation
Net book value
Year ended 30 June 2022
Opening net book value
Additions
Disposals
Depreciation
754,994
79,342
12,008,416
0
(53,669)
(1,013,505)
754,994
25,673
10,994,911
26,586
(5,686)
20,901
563,831
13,433,169
(147,394)
(1,220,254)
416,437
12,212,916
754,994
-
-
-
25,673
20,265
10,994,911
4,328,740
-
(247,500)
(26,947)
(1,122,160)
20,901
27,353
-
(9,301)
38,953
416,437
242,109
12,212,916
4,618,467
-
(247,500)
(66,335)
(1,224,743)
592,211
15,359,140
Closing net book value
754,994
18,991
13,953,991
Balance 30 June 2022
Cost
Depreciation
Net book value
754,994
99,607
16,089,656
53,939
805,939
17,804,136
-
(80,616)
(2,135,665)
(14,987)
(213,728)
(2,444,996)
754,994
18,991
13,953,991
38,952
592,211
15,359,140
Included within Plant and Equipment is an amount of $401,449 (2021 : $324,000) representing costs incurred
on equipment which was not brought to use as at 30 June 2022 and as such represents capital works in
progress.
19 Right-of-use assets and liabilities
Leases
The Group has two lease contracts, including one for its office premises which commenced on 1 March 2022
and a lease for a printer which commenced September 2020. The office lease has a lease term of three years
with no option to extend and with a rent increase of 3.75% each year. The printer lease has a term of two
years.
26 Refer ASX announcement dated 29 July 2022
Manuka Resources Ltd
For the year ended 30 June 2022
63
Short term lease expenses
The Group applies the short-term lease recognition exemption allowed in AASB116 to its short-term leases
(i.e. those leases that have a lease term of 12 months of less from the commencement date and do not contain
a purchase option). The following table shows the short-term lease expenses during the period to which this
exemption has been applied.
Rent expenses
Total short-term lease expenses
30 June
2022
$
11,520
11,520
30 June
2021
$
12,500
12,500
Set out below are the carrying amounts of right-of-use assets recognised and the movements during the
period.
Balance at start of period
Additions
Depreciation
Closing net book value
Set out below are the carrying amounts of lease liabilities.
Balance at start of period
Additions
Accretion of interest (included in finance expenses)
Payments
Closing balance lease liabilities
Current
Non-current
30 June
2022
$
68,083
420,714
(114,156)
374,641
30 June
2022
$
76,113
420,714
20,193
(133,079)
383,941
124,901
259,040
Financial assets and liabilities
20
20.1 Categories of financial assets and financial liabilities
The carrying amounts of financial assets in each category are as follows:
Financial assets at amortised cost
Cash and cash equivalents
Trade and other receivables
Other financial assets
Total financial assets at amortised cost
Total financial assets
Notes
12
13
20.3
30 June
2022
$
1,160,615
430,582
6,738,225
8,329,422
8,329,422
30 June
2021
$
194,557
4,933
(131,407)
68,083
30 June
2021
$
202,015
4,933
20,762
(151,597)
76,113
75,419
694
Restated
30 June
2021
$
1,018,035
693,571
7,147,984
8,859,590
8,859,590
Manuka Resources Ltd
For the year ended 30 June 2022
64
The carrying amounts of financial liabilities in each category are as follows:
Financial liabilities at amortised cost
Trade and other payables
Borrowings – Related party loans
30 June
2022
$
Restated
30 June
2021
$
21
20.2(a)
6,242,625
909,959
9,979,330
2,239,615
Borrowings – Senior secured debt facility (net of borrowing costs) 20.2(b)
12,128,978
14,023,439
Borrowings – Other loans
Lease liabilities
Total financial liabilities at amortised cost
Financial liabilities at fair value through profit and loss
Derivative liabilities
Total financial liabilities at fair value through profit and loss
Total financial liabilities
19
20.4
72,241
383,941
358,293
76,113
19,737,744
26,676,790
-
-
6,297
-
19,737,744
26,683,087
20.2 Borrowings
Borrowings include the following financial liabilities:
Current
Related party loans
Senior secured debt facility (net of borrowing costs)
Other loans
Total current borrowings
Non-current
Related party loans
Senior secured debt facility
Other loans
Total non-current borrowings
Total borrowings
30 June
2022
$
909,959
12,128,978
14,314
13,053,251
-
-
57,927
57,927
13,111,178
Restated
30 June
2021
$
-
-
-
-
2,239,615
14,023,439
358,293
16,621,347
16,621,347
20.2(a)
20.2(b)
20.2(a)
20.2(b)
All borrowings are denominated in Australian Dollars except for the TPC Facility which is denominated in US
Dollars.
(a) The related party loans include the following:
ResCap Investments Pty Ltd
Gleneagle Securities (Aust) Pty Ltd
30 June
2022
$
909,959
-
Restated
30 June
2021
$
1,708,636
530,979
The loan provided by ResCap Investments Pty Ltd includes working capital drawn down during the period
and amounts owing for services provided. The loan on the working capital portion has an interest rate of
16%. In line with the documentation in place at the time services were provided (being prior to listing on
Manuka Resources Ltd
For the year ended 30 June 2022
65
the ASX and during the period ended 2019), the portion relating to services rendered do not attract
interest.
The loan provided by Gleneagle Securities (Aust) Pty Ltd includes working capital drawn down during the
period and amounts owing for services provided. The loan on the working capital portion has an interest
rate of 12%. This was repaid in full during the period.
(b) The Company signed a debt facility agreement (TPC Facility) with TransAsia Private Capital Limited (TPC)
during July 2019, with the first drawdown occurring in July 2019. The TPC Facility limit was for a total of
US$14 Million (AU$20,364,427). As at 30 June 2022, the balance owing under the facility was US$8Million
plus interest (AU$12,332,456). During the financial period, US$2.084Million (AU$2,998,302) was repaid
earlier then the required repayment date of 30 September 2022. The interest rate attributable to this
facility is 12.5% per annum payable quarterly, with service and management fees of 2.5% per annum.
Subsequent to the end of the period, repayment of the balance was extended to 30 September 2023.
Details of the unamortised borrowing costs in relation to Senior secured debt facility is as follows:
Senior secured debt facility
Less: Borrowing Costs
30 June
2022
$
30 June
2021
$
12,332,456
14,023,439
(203,479)
-
Total senior secured debt facility (net of borrowing costs)
12,128,977
14,023,439
20.3 Other financial assets
Other financial assets comprises the following:
Current assets at amortised cost
Mt Boppy Resources - Deposit for exploration bond
Non-current assets at amortised cost
Manuka Resources - Deposit for environmental bond
Mt Boppy Resources – Deposit for environmental bond
Term Deposit
Rental Bond
Notes
(a)
(b)
(a)
30 June
2022
$
Restated
30 June
2021
$
186,000
84,000
5,021,967
1,352,016
178,242
-
5,407,665
1,372,982
192,272
91,065
6,738,225
7,147,984
The carrying amount of other financial assets is considered a reasonable approximation of fair value unless
stated below:
(a) The Environmental Bond and the Term Deposit in the name of Manuka Resources Ltd have been
amortised with reference to a discount rate of 3.12% (restated 2021: 0.83%). They have been discounted
over a 3.75 year period which is a reasonable approximation as to when the rehabilitation work will have
to be conducted.
(b) The Environmental Bond Deposits in the name of Mt Boppy Resources Pty Ltd have been recorded at
historical cost which has been assessed as a reasonable approximation of its fair value given the
rehabilitation work will have to be undertaken within 12 months.
Manuka Resources Ltd
For the year ended 30 June 2022
66
20.4 Derivative financial instruments and hedge accounting
Derivatives are only used for economic hedging purposes and not as speculative investments. As at 30 June
2022 the Company had no hedge positions in place. At the end of the prior period being 30 June 2021, the
Company had a hedge position of $6,297 reflecting a negative mark-to-market value of gold contracts. These
prior period end gold hedges comprised spot and swap gold contracts for 1,000 ounces of gold (2020: Nil) at
an average price of $2,359 per ounce (2022: Nil) The hedges were closed out in February 2022.
Derivative Financial instruments are measured at fair value and are summarised below:
Other financial liabilities comprises the following:
Gold spot and swap exchange contracts – cash flow hedge
Total derivative financial liabilities
30 June
2022
$
-
-
30 June
2021
$
6,297
6,297
Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are
subsequently remeasured to their fair value at the end of each reporting period. The accounting for
subsequent changes in fair value depends on whether the derivative is designated as a hedging instrument,
and if so, the nature of the item being hedged.
At inception of the hedge relationship, the Company documents the economic relationship between hedging
instruments and hedged items including whether changes in the cash flows of the hedging instruments are
expected to offset changes in the cash flows of hedged items. The Company documents its risk management
objective and strategy for undertaking its hedge transactions.
The full fair value of a hedging derivative is classified as a non-current asset or liability when the remaining
maturity of the hedged item is more than 12 months; it is classified as a current asset or liability when the
remaining maturity of the hedged item is less than 12 months. Trading derivatives are classified as a current
asset or liability.
The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow
hedges is recognised in other comprehensive income through the cash flow hedge reserve. The gain or loss
relating to the ineffective portion is recognised immediately in the Statement of Profit or Loss and Other
Comprehensive Income within other income or other expense.
Amounts accumulated in the cash flow hedge reserve are reclassified to the Statement of Profit or Loss and
Other Comprehensive Income in the periods when the hedged item affects profit or loss for instance when
the forecast sale that is hedged takes place.
When a hedging instrument expires or is sold or terminated, or when a hedge no longer meets the criteria for
hedge accounting, any cumulative gain or loss existing in equity at that time remains in equity and is
recognised when the forecast transaction is ultimately recognised in profit or loss. When a forecast transaction
is no longer expected to occur, the cumulative gain or loss that was reported in equity is immediately
reclassified to profit or loss. However, when the forecast transaction that is hedged results in the recognition
of a non-financial asset (for example, fixed assets) the gains and losses previously deferred in equity are
transferred from equity and included in the initial measurement of the cost of the asset. The deferred amounts
are ultimately recognised in profit or loss as depreciation in the case of fixed assets.
Manuka Resources Ltd
For the year ended 30 June 2022
67
The Group has designated certain gold swap and spot contracts as hedging instruments in cash flow hedge
relationships. These arrangements have been entered into to mitigate short-term commodity price impacts
arising from certain highly probable sales transactions and to give certainty to exchange rate and commodity
price impacts on the realised sales prices of the Commodities produced by the Group.
The Group’s Policy is to hedge up to 60% of highly probable forecast metal produced.
The following movements in the cash flow hedge reserve relate to one risk category being hedges relating to
cash flows arising from gold sales.
Cash flow hedging reserve
Opening balance at start of period
Change in fair value of hedging instrument recognised in
other comprehensive income (OCI)
Closing balance at end of period
30 June
2022
$
6,297
(6,297)
-
30 June
2021
$
-
6,297
6,297
No amounts have been reclassified to profit or loss. No ineffectiveness arose during the year ended 30 June
2022 (2021: Nil).
The effect of hedge accounting on the Group’s consolidated financial position and performance is as follows,
including the outline timing and profile of the hedging instruments:
Carrying amount of gold forward contracts
Notional amount of gold forward contracts
Hedge Ratio
Maturity date
Average forward gold price per oz (in AUD)
30 June
2022
$
-
-
n/a
n/a
30 June
2021
$
(6,297)
2,359,080
1:1
July to
September 2021
2,359
20.5 Other financial instruments
The carrying amount of the following financial assets and liabilities is considered a reasonable approximation
of fair value due to the short-term nature of the financial instruments:
• Trade and other receivables
• Cash and cash equivalents
• Trade and other payables
• Other current financial assets
Manuka Resources Ltd
For the year ended 30 June 2022
68
20.6 Fair Value Hierarchy
The following table provides the fair value measurement hierarchy of the Group’s financial assets and
liabilities. The following instruments are carried at fair value in the statement of financial position and are
measured at fair value through profit or loss.
at 30 June 2022
Liabilities
Derivative liabilities
at 30 June 2021
Liabilities
Derivative liabilities
Level 1
Quoted prices
in an active
market
Level 2
Significant
observable
inputs
Level 3
Significant
unobservable
inputs
$
-
6,297
$
-
-
$
-
-
At 30 June 2021 Environmental Bonds (including the Term Deposit for Rehabilitation) were valued at Fair
Value. With the restatement of the 30 Jun 2021 Balance Sheet as detailed at Note 4, Environmental Bonds
which were previously recorded at fair value, are now recorded at amortised cost.
21 Trade and other payables
Current
Trade creditors
Other creditors and accruals
Total trade and other payables
30 June
2022
$
30 June
2021
$
4,520,381
1,722,244
6,242,625
7,183,356
2,795,974
9,979,330
Trade and other payables amounts are short-term. The carrying values of trade payables and other payables
are considered to be a reasonable approximation of fair value.
22 Provisions
Current
Provision for annual leave
Total current provisions
Non-current
Provision for long service leave
Rehabilitation provisions
Total non-current provisions
Total provisions
Notes
22.1
30 June
2022
$
628,315
628,315
Restated
30 June
2021
$
460,189
460,189
29,107
7,565,403
7,594,510
8,222,825
17,125
7,440,642
7,457,767
7,917,956
Manuka Resources Ltd
For the year ended 30 June 2022
22.1 Rehabilitation provisions
Rehabilitation provisions split between the parent and subsidiary are as follows:
Rehabilitation provisions
Manuka Resources Ltd
Mt Boppy Resources Ltd
Total rehabilitation provisions
30 June
2022
$
6,422,934
1,142,469
7,565,403
Set out below are the movements of the rehabilitation provision during the period.
Carrying amount at start of year
Re-assessment of provision
Payments
Net impact of discounting
Carrying amount at end of year
30 June
2022
$
7,440,642
20,865
-
103,896
7,565,403
69
Restated
30 June
2021
$
6,319,038
1,121,604
7,440,642
Restated
30 June
2021
$
7,038,820
560,372
(73,736)
(84,814)
7,440,642
Provisions made for rehabilitation are recognised where there is a present obligation as a result of exploration,
development or production activities having been undertaken, and it is probable that an outflow of economic
benefits will be required to settle the obligation. The estimated future obligations include the costs of
removing facilities, abandoning mining activities and restoring the affected areas. The provision for future
rehabilitation costs is the best estimate of the present value of the expenditure required to settle the
obligation at the reporting date, based on current legal requirements and technology. Future rehabilitation
costs are reviewed annually, and any changes are reflected in the present value of the rehabilitation provision
at the end of the reporting period. The amount of the provision for future rehabilitation costs relating to
exploration and development activities is capitalised as a cost of those activities. If the effect is material,
provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current
market assessments of the time value of money, and where appropriate the risks specific to the liability. The
fair value of the rehabilitation provision for Manuka Resources has been calculated with reference to an
inflation rate of 5.09% (restated 2021: 2%) and a discount rate of 3.12% (restated 2021: 0.83%) over 3.75 years
(restated 2021: 4.75 years). As there is no committed mine plan for Mt Boppy, it has been assumed that
rehabilitation work will be completed within twelve to eighteen months. If a mine plan is implemented that
results in further mining activity this assumption will be amended.
The Company is required by the relevant regulatory authorities to ensure that appropriate rehabilitation is
carried out on tenements that are mined. The amount of rehabilitation cost is an estimate based upon the
estimated life of each mined tenement, as well as the future timing and cost of such rehabilitation. The
provision is constantly revised as information about the life of mine, depth of mining and cost estimates are
updated.
Manuka Resources Ltd
For the year ended 30 June 2022
70
23 Equity
23.1 Share capital
The share capital of Manuka Resources consists only of fully paid ordinary shares; the shares do not have a
par value. All shares are equally eligible to receive dividends and the repayment of capital and represent one
vote at the shareholders’ meeting of Manuka Resources.
Shares issued and fully paid:
• At beginning of period
• share issue 8 July 2020 (a)
• share issue 8 July 2020 (b)
• share issue 17 December 2020 (c)
• share issue 17 December 2020 (d)
• share issue 4 March 2022 (e)
• issue costs - options issued to broker
• issue costs – options issued to
shareholders
• IPO and Placement expenses
30 June
2022
30 June
2021
# Shares
# Shares
30 June
2022
$
269,353,712
193,087,960
21,512,355
-
-
-
-
21,265,752
35,000,000
17,500,000
2,500,000
16,666,669
-
-
-
-
-
-
-
-
-
-
-
5,000,000
(70,831)
(341,220)
30 June
2021
$
5,112,041
3,231,000
7,000,000
7,000,000
1,000,000
-
(873,499)
-
(329,191)
(957,187)
Total share capital at end of period
286,020,381
269,353,712
25,771,113
21,512,355
a) On 8 July 2020, the Company issued 21,265,752 shares at $0.15 per share for the conversion of
$3,231,000 in Convertible Notes to equity.
b) On 8 July 2020 the Company issued 35,000,000 shares at an issue price of $0.20 per share pursuant to
the offer under its prospectus dated 22 May 2020.
c) On 17 December 2020, the Company completed a Placement of $7,000,000 before costs through the
issue of 17,500,000 ordinary shares at $0.40 per share, to sophisticated, professional and institutional
investors.
d) On 17 December 2020, the Company converted $1,000,000 in unsecured loans to equity through the
issue of 2,500,000 ordinary shares at $0.40 per share.
e) On 4 March 2022 the Company completed a Placement of $5,000,000 before costs through the issue of
16,666,669 ordinary shares at $0.30 per share, to sophisticated, professional and institutional investors.
23.2 Movements in options on issue or granted
Beginning of the financial year
Issued, exercisable at $0.30 on or before 28 July 2023
Issued, exercisable at $0.32 on or before 30 September 2023
Issued, exercisable at $0.50 on or before 11 January 2024
Issued, exercisable at $0.50 on or before 3 March 2024
Issued, exercisable at $0.50 on or before 7 April 2024
End of the financial year
Number of Options
2022
2021
21,250,000
21,250,000
5,000,000
5,000,000
1,100,000
13,620,002
8,046,667
54,016,669
-
-
-
-
-
21,250,000
Manuka Resources Ltd
For the year ended 30 June 2022
71
23.3 Capital management policies and procedures
Management’s objectives when managing the capital of the company are to maintain a good debt to equity
ratio, provide the shareholders with adequate returns and to ensure that the company can fund its operations
and continue as a going concern.
The Company’s capital includes ordinary share capital, short-term borrowings and financial liabilities,
supported by financial assets.
The Company has a Loan to Value Ratio requirement of 80% under its TPC Facility. Borrowings are regularly
monitored and reported monthly to the Senior Secured Lender.
Management effectively manages the Company’s capital by assessing the Company’s financial risks and
adjusting its capital structure in response to changes in these risks and in the market. In making decisions to
adjust its capital structure the company considers not only its short-term position but also its long-term
operational and strategic objectives. In order to maintain or adjust the capital structure, the Company may
return capital to shareholders, pay dividends to shareholders or issue new shares.
24 Reconciliation of cash flows from operating activities
(a) Details of the reconciliation of cash flows from operating activities are listed in the following table:
Cash flows from operating activities
Profit / (loss) for the period
Adjustments for non-cash items:
•
•
•
•
•
•
depreciation and amortisation
discounting of provisions and financial assets
share based payments
accretion of interest and finance costs
amortisation of borrowing costs
unrealised foreign exchange gains
Change in operating assets and liabilities:
•
•
•
•
•
•
change in trade and other receivables
change in prepayments
change in inventories
change in trade, other payables and related party advances
change in contract liabilities
change in provisions
Net cash provided by operating activities
30 June
2022
$
30 June
2021
$
5,281,420
(2,895,244)
2,653,448
407,986
69,718
(301,145)
667,929
5,506,027
(41,591)
-
(1,858,103)
556,361
1,197,825
(1,129,722)
266,241
(200,925)
1,803,164
(3,736,706)
62,183
180,108
8,351,246
(44,363)
(218,500)
(2,684,526)
2,728,757
-
288,697
207,793
Manuka Resources Ltd
For the year ended 30 June 2022
72
(b) The Company has undertaken a number of non-cash investing and financing activities. Details of the non-
cash financing activities which have resulted in the issue of shares are outlined above at Note 23.1 In
addition, the Company has issued options in respect of non-cash financing and investing activities as
outlined in the table below.
21 July 2021 – Options issued to finance
provider in respect of financing and extension of
financing
•
expenses
Borrowings – capitalised finance
4 March 2022/8 April 2022 – Options issued
pursuant to share placement
•
Share based payment expenses
8 April 2022 - Options granted to lead broker for
placement services
•
Other contributed equity
25 Earnings / (Loss) per share
# options
30 June
2022
$
30 June
2021
$
10,000,000
871,408
16,666,669
341,220
5,000,000
70,831
-
-
-
Profit / (loss) attributable to the owners of the Company used in calculating
basic and diluted loss per share
Weighted average number of ordinary shares used as the denominator in
calculating basic and diluted loss per share *
Basic earnings / (loss) per share
Diluted earnings / (loss) per share
30 June
2022
$
30 June
2021
$
5,281,420
(3,074,177)
No of shares
No of shares
274,741,841
258,805,422
Cents per share Cents per share
(1.19)
1.92
1.61
(1.19)
As the Group made a loss for the year ended 30 June 2021, none of the potentially dilutive securities were
included in the calculation of diluted earnings per share for that year. These securities could potentially dilute
basic earnings per share in the future.
* In accordance with AASB 133 paragraph 26, the weighted average number of shares outstanding during the
period and for all periods presented shall be adjusted for events (such as a share consolidation) that have
changed the number of shares outstanding without a corresponding change in resources.
26 Reserves
26.1 Share based payments
Options over ordinary shares have been granted to employees and Directors and finance providers from time
to time, on a discretionary basis. The cost of these share-based payments is measured by reference to the fair
value at the date at which they are granted using an option pricing model. The options may be subject to
service or other vesting conditions and their fair value is recognised as an expense together with a
corresponding increase in other reserve equity over the vesting period.
Manuka Resources Ltd
For the year ended 30 June 2022
73
The weighted average fair value of the options granted during the year was 44 cents. The fair values were
determined using a variation of the binomial option pricing model that takes into account factors such as the
vesting period, applying the following inputs:
Weighted average exercise price (cents)
Weighted average life of the option (years)
Weighted average underlying share price (cents)
Weighted average expected share price volatility
Weighted average risk free interest rate
30 June
2022
44
1.4
29
59%
0.65%
30 June
2021
-
-
-
-
-
Set out below is a summary of the share-based payment options granted:
30 June 2022
30 June 2021
Beginning of the year
Granted
Forfeited
Exercised
Expired
Outstanding at year end
Exercisable at year end
Weighted
average exercise
price cents
25
44
-
-
-
37
37
# Options
21,250,000
32,766,669
-
-
-
54,016,669
54,016,669
Weighted
average exercise
price cents
25
-
-
-
-
25
25
# Options
21,250,000
-
-
-
-
21,250,000
21,250,000
The weighted average remaining contractual life of share options outstanding at the end of the financial year
was 0.6 years (2021: 1.9 years), and the weighted average exercise price is 37 cents.
During the period there were share-based payment expenses of $69,718 recorded (2021: $Nil) in the profit or
loss and there was an increase in the share option reserve of $1,353,177 (2021: $Nil). At 30 June 2022 the
total value of the share based payment reserve is $2,839,254 (2021: $1,486,077).
26.2 Hedging Reserve
The hedging reserve comprises the effective portion of the cumulative net change in the fair value of hedging
instruments (net of tax) used in cash flow hedges pending subsequent recognition in profit or loss The hedging
reserve is used to record gains or losses on derivatives that are designated and qualify as cash flow hedges
and that are recognised in other comprehensive income. Amounts are reclassified to profit or loss when
the associated hedged transaction affects profit or loss. At 30 June 2022, the total value of the hedging reserve
is $Nil (2021: ($6,297)).
27
Financial risk management
General objectives, policies and processes
In common with all other businesses, the Company is exposed to risks that arise from its use of financial
instruments. This note describes the Company’s objectives, policies and processes for managing those risks
and the methods used to measure them. Further quantitative information in respect of these risks is presented
throughout these financial statements.
Manuka Resources Ltd
For the year ended 30 June 2022
74
There have been no substantive changes in the Company’s exposure to financial instrument risks, its
objectives, policies and processes for managing those risks or the methods used to measure them from
previous periods unless otherwise stated in this note.
Activities undertaken by the Company may expose the Company to market risk (including gold price risk,
currency risk and interest rate risk), credit risk and liquidity risk. The Board has overall responsibility for the
determination of the Company’s risk management objectives and policies and, whilst retaining ultimate
responsibility for them, it has delegated the authority to its finance team, for designing and operating
processes that ensure the effective implementation of the objectives and policies of the Company. The
Company's risk management policies and objectives are therefore designed to minimise the potential impacts
of these risks on the results of the Company where such impacts may be material. The Board receives regular
updates from Management through which it reviews the effectiveness of the processes put in place and the
appropriateness of the objectives and policies it sets.
The overall objective of the Board is to set policies that seek to reduce risk as far as possible without unduly
affecting the company’s competitiveness and flexibility.
At 30 June 2022, the Company held the following financial instruments:
Financial assets
Cash and cash equivalent
Trade and other receivables
Other financial assets
Total financial assets
Financial liabilities
Trade and other payables
Related party loans
Other interest-bearing loans (net of borrowing costs)
Lease liabilities
Derivative liabilities
Total financial liabilities
30 June
2022
$
1,160,615
430,582
6,738,225
8,329,422
Restated
30 June
2021
$
1,018,035
693,571
7,147,984
8,859,590
6,242,625
909,959
9,979,330
2,239,615
12,201,219
14,381,732
383,941
-
76,113
6,297
19,737,744
26,683,087
The fair value of current and non-current financial instruments is assumed to approximate their carrying value.
Market Risk
Market risk is the risk that changes in market prices, such as foreign exchange rates, commodity prices, interest
rates and equity prices will affect the consolidated entity income or the value of its holdings of financial
instruments.
The Group is currently exposed to the risk of fluctuations in prevailing market commodity prices on the gold
and silver currently produced from its gold mine. The Group does not have any physical gold or silver delivery
contracts in place as at 30 June 2022 (30 June 2021: Nil).
Derivative financial instruments and hedge accounting
Derivatives are only used for economic hedging purposes and not as speculative investments.
Manuka Resources Ltd
For the year ended 30 June 2022
75
Changes in the market gold price will affect the derivative valuation at each reporting date. The objective of
market risk management is to manage and control market risk exposures within acceptable parameters, while
optimising the return. The consolidated entity enters into derivative financial instruments to hedge such
transactions.
The Company’s risk management policy is to hedge between 0% to 60% of forecast gold/silver sales in local
currency over a rolling 24-month period. As at 30 June 2022 the Company had no hedge positions in place. At
the end of the prior period being 30 June 2021, the Company had a hedge position of $6,297 reflecting a
negative mark-to-market value of gold contracts. These prior period end gold hedges comprised spot and swap
gold contracts for 1,000 ounces of gold (2020: Nil) at an average price of $2,359 per ounce (2022: Nil) The
hedges were closed out in February 2022. At 30 June 2022 the Company had closed all gold forward contracts
used to hedge the exposure of future gold sales. The following table sets out the current hedge position and
fair value:
No. of
contracts
-
3
Gold sold
-
1,000 oz
0-6 months
$’000
Maturity
7-12 months
$’000
More than 1
year $’000
-
$6
-
-
-
-
As at 30 June 2022
As at 30 June 2021
Gold price sensitivity
The carrying amount of derivative financial instruments are valued using appropriate valuations models with
inputs such as forward gold prices. The potential effect of using reasonably possible alternative assumptions
in these models, based on changes in the forward gold price by 10 per cent while holding all other variables
constant, is shown in the following table:
30 June 2022
Derivative Financial Instruments
30 June 2021
Derivative Financial Instruments
Carrying amount
$’000
Other Comprehensive Income
10% increase
$’000
10% decrease
$’000
-
6
-
(236)
-
236
The accounting policy for derivative financial instruments and hedge accounting is outlined at Note 20.4 above.
Certain derivative instruments do not qualify for hedge accounting. Changes in the fair value of any derivative
instruments that do not qualify for hedge accounting are recognised immediately in the income statement.
During the period, the Company did not enter into any fair value hedges (2021: 4,000 oz of gold) which did not
classify for hedge accounting. During the prior year ended 30 June 2021, an amount of $248,454 was
recognised in the Profit and Loss in relation to these hedges which were settled prior to the end of the period.
Credit risk
Credit risk is the risk that the other party to a financial instrument will fail to discharge their obligation resulting
in the Company incurring a financial loss. This usually occurs when debtors fail to settle their obligations owing
to the Company. The policy of the Company is that sales are only made to customers that are credit worthy.
Credit limits for each customer are reviewed and approved by Management.
Receivable balances are monitored on an ongoing basis. The Company has one Key Customer which is an LBMA
Accredited Refinery. To mitigate Credit Risk associated with its Key Customer, the Company has in place a
contract which ensures payment is received at the time of transfer of title and physical delivery of goods.
Manuka Resources Ltd
For the year ended 30 June 2022
76
To mitigate the credit risk associated with cash and cash equivalents, contracts are taken out only with
reputable financial institutions in Australia.
The maximum exposure to credit risk at balance date in relation to each class of financial asset is the carrying
amount of those assets, which is net of impairment losses. Refer to the summary of financial instruments table
above for the total carrying amount of financial assets.
Liquidity risk
Liquidity risk is the risk that the Company may encounter difficulties raising funds to meet commitments
associated with financial instruments, e.g. borrowing repayments. Prudent liquidity risk management implies
maintaining sufficient cash and ensuring the availability of funding through an adequate amount of committed
credit facilities.
The Company manages liquidity risk by continuously monitoring forecasted and actual cash flows, seeking the
financial support from its shareholders, finding debt providers and matching the maturity profiles of financial
assets and liabilities.
Maturity Analysis
The table below summarises the maturity profile of the Company’s financial liabilities based on contractual
commitments.
2022
Non-derivatives
Trade and other payables
Related party loans
Other interest-bearing loans
Lease liabilities
2021
Non-derivatives
Trade and other payables
Related party loans
Other interest-bearing loans
Lease liabilities
Carrying
Amount
Contractual
Cash flows
< 6 months
6- 12
months
1-3 years
$
$
$
6,242,625
6,242,625
6,242,625
909,959
12,201,219
383,941
1,000,577
14,519,060
454,288
46,532
1,571,025
82,074
$
-
$
-
36,247
851,233
83,646
917,798
12,096,802
288,568
19,737,744
22,216,550
7,942,256
971,126
13,303,168
9,979,330
9,979,330
9,979,330
2,239,615
14,381,732
76,113
2,483,092
16,644,553
79,370
181,534
905,128
77,497
-
97,391
905,128
1,405
-
2,204,167
14,834,297
468
26,676,790
29,186,345
11,143,489
1,003,924
17,038,932
Foreign exchange risk
Foreign exchange risk arises from future commercial transactions and recognised assets and liabilities
denominated in a currency that is not the entity’s functional currency. The Group has not formalised a foreign
currency risk management policy however, it monitors its foreign currency expenditure considering exchange
rate movements.
Manuka Resources Ltd
For the year ended 30 June 2022
77
The Group is exposed to foreign exchange risk through the USD denominated debt facility obtained from its
senior secured lender, refer Note 20.2(d). The Group’s exposure to foreign currency risk at the end of the
reporting period, expressed in Australian dollar, was as follows:
Borrowings
30 June
2022
$
12,332,456
30 June
2021
$
14,023,439
The aggregate net foreign exchange gains/losses recognised in profit or loss were:
Net foreign exchange gain / (loss) recognised in profit or
loss included in finance expenses
30 June
2022
$
30 June
2021
$
(1,023,183)
1,721,879
Sensitivity analysis
The following table demonstrates the sensitivity to a reasonably possible change in the USD:AUD exchange
rate, with all other variables held constant, of the Company’s profit/loss after tax (through the impact on USD
denominated financial liabilities).
USD:AUD exchange rate – increase 10%
USD:AUD exchange rate – decrease 10%
30 June
2022
$
30 June
2021
$
1,055,701
1,219,377
(1,290,302)
(1,490,349)
Interest rate risk
Interest rate risk is the Company’s exposure to market risk for changes in interest rates relates primarily to
cash and interest-bearing liabilities. The Company's exposure to interest rate risk and the effective weighted
average interest rate by maturity periods is set out in the tables below:
Weighted
average
interest rate
Floating rates
Fixed rates
Non-interest
bearing
Total
2022
Financial assets
Cash and cash equivalent
Trade and other receivables
Other financial assets
Financial liabilities
Trade and other payables
Related party loans
Other interest-bearing loans
Lease liability
-
-
-
-
16%
14%
14%
$
-
-
-
-
-
-
-
-
-
$
-
-
-
-
-
453,083
11,684,906
383,941
12,521,930
$
$
1,160,615
430,582
6,738,225
8,329,422
6,242,625
456,876
516,313
-
7,215,814
1,160,615
430,582
6,738,225
8,329,422
6,242,625
909,959
12,201,219
383,941
19,737,744
Manuka Resources Ltd
For the year ended 30 June 2022
78
Weighted
average
interest rate
Floating rates
Fixed rates
Non-interest
bearing
Total
2021
Financial assets
Cash and cash equivalent
Trade and other receivables
Other financial assets
Financial liabilities
Trade and other payables
Related party loans
Other interest-bearing loans
Lease liability
-
-
-
-
15%
18%
14%
$
-
-
-
-
-
-
-
-
-
$
-
-
-
-
-
1,283,881
13,771,435
76,113
15,131,429
$
$
1,018,035
693,571
7,147,984
8,859,590
9,979,330
955,734
610,297
-
11,545,361
1,018,035
693,571
7,147,984
8,859,590
9,979,330
2,239,615
14,381,732
76,113
26,676,790
Sensitivity analysis
The Company has fixed rate or non-interest bearing financial assets and liabilities and has no exposure to a
changes in interest rates.
28 Commitments for expenditure
28.1 Tenement Commitments
In order to maintain current rights of tenure to exploration tenements, the Company is required to perform
minimum exploration work to meet the minimum expenditure requirements specified by the State
Government. Due to the nature of the Company’s operations in exploring and evaluating areas of interest,
exploration expenditure commitments beyond twelve months cannot be reliably determined. It is anticipated
that expenditure commitments in subsequent years will be similar to that for the forthcoming twelve months.
These obligations are not provided for in the financial report and are payable as follows:
Not later than one year
Between 1 year and 5 years
30 June
2022
$
1,106,667
4,383,333
5,490,000
30 June
2021
$
561,507
671,096
1,232,603
If the Company decides to relinquish certain leases and/or does not meet these obligations, assets recognised
in the Statement of Financial Position may require review to determine the appropriateness of carrying values.
29 Contingent assets and liabilities
29.1 Bank Guarantee to Cobar Shire Council and road rehabilitation
The Company has a term deposit with NAB to cover a bank guarantee of $200,000 issued by the NAB to Cobar
Shire Council. The bank guarantee is required by Cobar Shire Council to cover the estimated cost of restoring
the road to their pre-mining condition.
Due to the contingent nature of the asset and liability and the significant uncertainty of timing and because
the cost of necessary road repairs cannot be estimated with any degree of certainty, the value of the bank
guarantee has not been brought to account in the financial statements of the Company.
Manuka Resources Ltd
For the year ended 30 June 2022
79
29.2 Rental bond and office lease guarantee and indemnity
The Company has entered into a Deed of Indemnity to in relation to a Lease Bond Facility with Lombard
Insurance Company Ltd. The Lease Bond Facility covers the Company’s guarantee and indemnity obligations
in respect of the office lease outlined at Note 19. The total facility as at 30 June 2022 was $111,514,.31 (2021:
$Nil).
Interests in Subsidiaries
30
Set out below are details of the subsidiaries held directly by the Group:
Name of the subsidiary
Place of incorporation and
place of business
Principal
activity
Mt Boppy Resources Pty Ltd
Australia
Gold Mine
30 June
2022
100%
30 June
2021
100%
Proportion of ownership interests
held by the Group
31 Parent Entity Information
Information relating to Manuka Resources Ltd (the Parent Entity):
Current assets
Non-current assets
Total assets
Current liabilities
Non-current liabilities
Total liabilities
Net assets / (deficit)
Statement of profit or loss and other comprehensive income
Profit / (loss) for the year
Other comprehensive income / (loss)
Total comprehensive profit / loss
30 June
2022
$
Restated
30 June
2021
$
5,318,650
7,079,698
34,421,877
28,077,384
39,740,527
35,157,082
18,799,563
9,608,910
6,769,008
22,874,060
25,568,571
32,482,970
14,171,956
2,674,112
5,482,314
(2,877,080)
6,297
(6,297)
5,488,611
(2,883,377)
The Parent Entity has contingent liabilities at the year end as outlined in Note 29.
Manuka Resources Ltd
For the year ended 30 June 2022
80
32 Related party transactions
32.1 Transactions with related parties and outstanding balances
The Company’s related parties include key management personnel, and others as described below. Unless
otherwise stated, none of the transactions incorporate special terms and conditions and no guarantees were
given or received. Outstanding balances are usually settled in cash.
Notes
30 June
2022
$
30 June
2021
$
DETAILS OF TRANSACTIONS WITH RELATED PARTIES:
Details of related party transactions with ResCap
Investments Pty Ltd, an entity controlled by a member of
KMP:
•
interest charged on intercompany loan
•
conversion of debt to equity in Manuka Resources
23.1 (d)
29,184
-
83,640
1,000,000
Details of related party transactions with Gleneagle
Securities (Aust) Pty Ltd, being an entity which is a related
party due its control over the Convertible Notes pursuant to
the Convertible Note Deed Poll. Gleneagle Securities (Aust)
Pty Ltd ceased being a related party on conversion of the
Convertible Notes in July 2020.
•
•
interest charged on intercompany loan
interest on notes payable to convertible note
holders
DETAILS OF BALANCES WITH RELATED PARTIES:
Balance of loan with Manuka Resources Ltd
- payable to ResCap Investments Pty Ltd
- payable to Gleneagle Securities (Aust) Pty Ltd
Balance of loan with Mt Boppy Resources Pty Ltd
- payable to ResCap Investments Pty Ltd
-
-
28,428
19,638
20.2(a)
20.2(a)
20.2(a)
909,959
-
-
1,624,493
530,979
84,143
32.2 Transactions with key management personnel
Key management personnel remuneration includes the following expenses:
Short-term employee benefits
Post-employment benefits
Long-term benefits
Share-based payments
Total remuneration
30 June
2022
$
817,827
45,628
-
69,718
933,173
30 June
2021
$
846,890
62,517
-
-
909,407
Detailed remuneration disclosures are provided in the remuneration report on pages 25 to 30.
Manuka Resources Ltd
For the year ended 30 June 2022
81
33 Events subsequent to the end of the reporting period
• Execution of Binding Term Sheet for the purchase of Trans-Tasman Resources Limited (“TTR”)
Manuka entered into a Binding Term Sheet for the purchase (subject to Manuka shareholder approval) of
emerging vanadiferous titanomagnetite iron sands producer Trans-Tasman Resources Limited on 12th
August 202227. Manuka will acquire 100% of TTR for the issue of between 170-180 million new Manuka
shares. TTR is the owner of a 3.8B tonne iron sands resource located in the South Taranaki Bight on the
North Island of New Zealand. Post completion of this transaction a bankable feasibility study will be
progressed based on offshore recovery and processing of this resource into an iron ore concentrate with
vanadium and titanium credits.
• Extension of Secured Debt Facility Extension
Since the end of the reporting period, the Company successfully negotiated to extend the term of the
secured debt facility to 30 September 2023.28 The extension has been granted on existing terms and rates
with no extension penalties or cash fees. The Company has resolved at a Board meeting held 29th
September 2022 to grant the issue of 5Million options with an exercise price based on the 5-day VWAP
plus a 10% premium.
Apart from the matters noted above, there are no other matters or circumstances that have arisen since the
end of the period that has significantly affected or may significantly affect either:
•
•
•
the entity’s operations in future financial years;
the results of those operations in future financial years; or
the entity’s state of affairs in future financial years.
34 Company Details
The registered office and principal place of business of the Company is:
Manuka Resources Ltd
Level 4 Grafton Bond Building
201 Kent Street, Sydney, New South Wales
27 Refer ASX release dated 12 August 2022
28 Refer ASX release dated 24 August 2022
Manuka Resources Ltd
For the year ended 30 June 2022
82
Directors’ Declaration
In the opinion of the Directors of Manuka Resources Ltd:
a The financial statements and notes of Manuka Resources Ltd are in accordance with the Corporations
Act 2001, including:
i.
ii.
Giving a true and fair view of the consolidated entity’s financial position as at 30 June 2022 and of
its performance for the financial year ended on that date; and
Complying with Accounting Standards, the Corporations Regulations 2001 and other mandatory
professional reporting requirements;
b There are reasonable grounds to believe that Manuka Resources Ltd will be able to pay its debts as
and when they become due and payable; and
c 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.
The directors have been given the declarations by the chief executive officer and chief financial officer required
by section 295A of the Corporations Act 2001.
Signed in accordance with a resolution of the directors.
Dennis Karp
Executive Chairman
Dated the 30th day of September 2022
Ernst & Young
200 George Street
Sydney NSW 2000 Australia
GPO Box 2646 Sydney NSW 2001
Tel: +61 2 9248 5555
Fax: +61 2 9248 5959
ey.com/au
Independent auditor’s report to the members of Manuka Resources Limited
Report on the audit of the financial report
Opinion
We have audited the financial report of Manuka Resources Limited (“the Company”) and its
subsidiaries (collectively the Group), which comprises the statement of financial position as at 30 June
2022, the statement of profit or loss and other comprehensive income, statement of changes in
equity and statement of cash flows for the year then ended, notes to the financial statements,
including a summary of significant accounting policies, and the directors’ declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations
Act 2001, including:
a. Giving a true and fair view of the consolidated financial position of the Group as at 30 June 2022
and of its consolidated financial performance for the year ended on that date; and
b. Complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s responsibilities for the audit of the financial
report section of our report. We are independent of the Company 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 believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Material uncertainty related to going concern
We draw attention to Note 3.2 in the financial report, which indicates that the Group’s current
liabilities exceeded its current assets by $14,737,774 as at 30 June 2022. This condition, along with
other matters set forth in Note 3.2 indicate the existence of a material uncertainty which may cast
significant doubt on the Group’s ability to continue as a going concern. Our opinion is not modified in
respect of this matter.
Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance in
our audit of the financial report of the current year. These matters were addressed in the context of
our audit of the financial report as a whole, and in forming our opinion thereon, but we do not provide
a separate opinion on these matters. In addition to the matter described in the Material Uncertainty
Related to Going Concern section, we have determined the matters described below to be the key
audit matters to be communicated in our report. For each matter below, our description of how our
audit addressed the matter is provided in that context.
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Liability limited by a scheme approved under Professional Standards Legislation
Page 2
We have fulfilled the responsibilities described in the Auditor’s responsibilities for the audit of the
financial report section of our report, including in relation to these matters. Accordingly, our audit
included the performance of procedures designed to respond to our assessment of the risks of
material misstatement of the financial report. The results of our audit procedures, including the
procedures performed to address the matters below, provide the basis for our audit opinion on the
accompanying financial report.
Carrying value of Non-Current Assets
Why significant
How our audit addressed the key audit matter
At 30 June 2022 the carrying value of the Group’s non-
current assets totalled $36,159,645, comprising of mine
properties and development, exploration and evaluation, and
property, plant and equipment. The Group assessed there is
one cash generating unit (CGU) for impairment purposes.
Australian Accounting Standards require the Group to assess
whether there are any indicators that its non-current assets
may be impaired. If such indicator exists, the Group
estimates the recoverable amount of the CGU.
At 30 June 2022, the Group determined that no indicators
of impairment were present and accordingly the Group’s
analysis concluded that no impairment was required.
The assessment of indicators of impairment and
determination of CGUs involves judgment including
assessing future expected operating performance,
considering changes in market conditions including gold and
silver price forecasts, assessment of interdependence of
cash flows and estimation of reserves and resources.
Due to the significance of the carrying amount of the non-
current assets relative to total assets and the significant
judgment required in determining whether indicators of
impairment exist, we consider this a key audit matter.
In performing our procedures, we:
•
Evaluated the Group’s identification of its CGUs and its
quantification of the carrying amount of its CGUs.
•
Considered whether indicators of impairment were
present for the CGU with reference to the Australian
Accounting Standards for both mining and exploration
assets including:
o Assessing whether there is any indication the
market value of the CGU has declined during the
period with reference to recent operating results
and JORC compliant resource data;
o Verifying that all licences held were current and
in good standing and that budgeted spend was
planned;
o Considering whether any significant adverse
changes in the market had occurred during the
period with reference to commodity price data
and relevant market factors;
o Considering whether any obsolesce or physical
asset damage had occurred with reference to
knowledge obtained from a site visit conducted
by the audit team and the age and functionality
of all physical items of PP&E (including the
processing plant);
o Compared the Group’s total net assets to market
capitalisation;
o Performing a cross check of carrying values at
30 June 2022 to other market information
including resource multiples appropriate to the
assets;
o In respect of the physical PP&E (including the
processing plant), considering whether there was
anything to suggest the carrying value is not
recoverable, with reference to the nature and
age of the assets, the plant’s processing
functionally, recent comparable transactions and
alternate use cases.
• Obtained and reviewed the independent third party
resource statements prepared in compliance with the
JORC Code 2012.
•
Evaluated the qualifications, competence and
objectivity of the experts used by the Group to
determine the gold and silver resource estimates.
• Assessed the adequacy of the related disclosures in the
notes to the financial statements.
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Liability limited by a scheme approved under Professional Standards Legislation
Page 3
Information other than the financial report and auditor’s report thereon
The directors are responsible for the other information. The other information comprises the
information included in the Company’s 2022 annual report but does not include the financial report
and our auditor’s report thereon. We obtained the directors’ report that is to be included in the annual
report, prior to the date of this auditor’s report, and we expect to obtain the remaining sections of the
annual report after the date of this auditor’s report.
Our opinion on the financial report does not cover the other information and accordingly we do not
express any form of assurance conclusion thereon, with the exception of the Remuneration Report
and our related assurance opinion.
In connection with our audit of the financial report, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of the directors for the financial report
The directors of the Company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001
and for such internal control as the directors determine is necessary to enable the preparation of the
financial report that gives a true and fair view and is free from material misstatement, whether due to
fraud or error.
In preparing the financial report, the directors are responsible for assessing the Group’s ability to
continue as a going concern, disclosing, as applicable, matters relating to going concern and using the
going concern basis of accounting unless the directors either intend to liquidate the Group or to cease
operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with the Australian Auditing Standards will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material
if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of this financial report.
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional
judgment and maintain professional scepticism throughout the audit. We also:
•
•
Identify and assess the risks of material misstatement of the financial report, whether due to
fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not
detecting a material misstatement resulting from fraud is higher than for one resulting from
error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the
override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Group’s internal control.
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
Page 4
•
•
•
•
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the directors.
Conclude on the appropriateness of the directors’ use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to
events or conditions that may cast significant doubt on the Group’s ability to continue as a going
concern. If we conclude that a material uncertainty exists, we are required to draw attention in
our auditor’s report to the related disclosures in the financial report or, if such disclosures are
inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up
to the date of our auditor’s report. However, future events or conditions may cause the Group to
cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial report, including the
disclosures, and whether the financial report represents the underlying transactions and events
in a manner that achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or
business activities within the Group to express an opinion on the financial report. We are
responsible for the direction, supervision and performance of the Group audit. We remain solely
responsible for our audit opinion.
We communicate with the directors regarding, among other matters, the planned scope and timing of
the audit and significant audit findings, including any significant deficiencies in internal control that we
identify during our audit.
We also provide the directors with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other
matters that may reasonably be thought to bear on our independence, and where applicable, actions
taken to eliminate threats or safeguards applied.
From the matters communicated to the directors, we determine those matters that were of most
significance in the audit of the financial report of the current year and are therefore the key audit
matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter
should not be communicated in our report because the adverse consequences of doing so would
reasonably be expected to outweigh the public interest benefits of such communication.
Report on the audit of the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 25 to 30 of the directors’ report for the
year ended 30 June 2022.
In our opinion, the Remuneration Report of Manuka Resources Limited for the year ended 30 June
2022, complies with section 300A of the Corporations Act 2001.
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
Page 5
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.
Ernst & Young
Siobhan Hughes
Partner
Sydney
30 September 2022
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
Manuka Resources Ltd
For the year ended 30 June 2022
88
ASX Additional Information
Additional information required by Australian Securities Exchange Ltd and not shown elsewhere
in this report is as follows. The information is current as at 30th September 2022.
(a) Distribution of equity securities
Analysis of numbers of equity security holders by size of holding:
1
1,001
5,001
10,001
100,001
-
-
-
-
1,000
5,000
10,000
100,000
and over
The number of equity security holders holding less than a marketable
parcel of securities are:
Ordinary shares
Number of holders
Number of shares
137
644
437
686
183
2,087
570
89,863
1,795,068
3,742,254
23,767,357
256,625,839
286,020,381
965,223
(b) Twenty largest shareholders
Twenty largest quoted equity security holders
The names of the twenty largest holders of quoted ordinary shares are:
Listed ordinary shares
Number of shares
1
2
3
4
5
6
7
7
7
8
9
10
11
12
13
14
15
16
16
17
RESCAP INVESTMENTS PTY LTD
SPINITE PTY LTD
CLAYMORE CAPITAL PTY LTD
RESCAP INVESTMENTS PTY LTD
LEVEL 1 PTY LTD
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
ADAM AARON ROSENBERG
MATTHEW DAVID ROSENBERG
BRETT SAMUEL ROSENBERG
BNP PARIBAS NOMINEES PTY LTD
KIZOGO PTY LTD
CITICORP NOMINEES PTY LIMITED
SPINITE PTY LTD
A N HOLMAN INVESTMENTS PTY LIMITED
EXIT OUT PTY LTD
GEULAH PTY LTD
MR DALE ANDREW BURKITT
VISVALINGAM PTY LTD
MINING ASSOCIATES LIMITED
JONATHAN MARQUARD & AMANDA HUTTON
79,833,280
11,917,297
11,526,296
10,440,000
10,119,496
9,327,118
8,152,174
8,152,174
8,152,174
6,066,083
5,434,783
5,304,397
4,234,712
3,825,361
3,194,938
2,974,610
2,600,000
2,072,573
2,072,573
1,890,637
Percentage of
ordinary shares
27.91%
4.17%
4.03%
3.65%
3.54%
3.26%
2.85%
2.85%
2.85%
2.12%
1.90%
1.85%
1.48%
1.34%
1.12%
1.04%
0.91%
0.72%
0.72%
0.66%
202,599,501
70.83%
Manuka Resources Ltd
For the year ended 30 June 2022
89
(c) Substantial shareholders
The names of substantial shareholders who have notified the Company in accordance with
section 671B of the Corporations Act 2001 are:
Number of Shares
% Issued Capital
Level 1 Pty Ltd (ACN 105 622 928) , Kizogo Pty Ltd
(ACN003 334 370) , Claymore
Capital Pty Ltd (ACN 082 722 290) , Sharron
Ruth Rosenberg
ResCap Investments Pty Ltd
Dennis Karp (including holding of ResCap Investments Pty Ltd)
30,413,247
10.63%
90,273,280
91,814,557
31.56%
33.51%
(d) Voting rights
All ordinary shares (whether fully paid or not) carry one vote per share without restriction.
(e) Schedule of interests in mining tenements as at 30 September 2022
Location : Wonawinta Silver Project is situated approximately 90 kilometres to the south of
Cobar, NSW, and comprises one (1) granted mining lease and seven (7) granted exploration
licences as below, plus processing plant and associated infrastructure .
Tenement
ML1659
EL6482
EL7345
EL6155
EL6302
EL7515
EL6623
EL8498
Percentage held / earning
100%
100%
100%
100%
100%
100%
100%
100%
Change during quarter
-
-
-
-
-
-
-
-
Location : Mt Boppy Gold Project is situated approximately 45 kilometres east of Cobar, NSW,
adjacent to the Barrier Highway. The Project comprises four (4) gold leases, two (2) mining
leases, one (1) mining purpose lease and one (1) exploration licence which encompasses the
MLs and extends the project area to the south.
Tenement
GL3255
GL5836
GL5848
GL5898
ML311
ML1681
MPL240
EL5842
Percentage held / earning
100%
100%
100%
100%
100%
100%
100%
100%
Change during quarter
-
-
-
-
-
-
-
-
Manuka Resources Ltd
For the year ended 30 June 2022
90
(f) Unquoted Securities
At 30 September 2022, the Company had the following unlisted securities on issue:
Class
$0.25 options, expiring 17/04/2023
$0.25 options, expiring 14/07/2023
$0.30 options, expiring 28/07/2023
$0.32 options, expiring 30/09/2023
Number of
Securities
11,250,000
10,000,000
5,000,000
5,000,000
Number of
Holders
8
1
1
1
$0.50 options. expiring 11/04/2024
1,100,000
3
$0.50 options, expiring 04/03/2023
$0.50 options, expiring 08/04/2023
13,620,002
8,046,667
71
17
Holders of 20% or more of the class
Holder Name
n/a
Bell Potter Securities Ltd
Conan Minerals Group Pty Ltd
TA Private Capital Security
Agent Ltd
Dennis Karp
Nicholas Lindsay
Anthony McPaul
n/a
Evolution Capital Pty Ltd
Number of
Securities
10,000,000
5,000,000
5,000,000
500,000
300,000
300,000
3,750,000
(f) Restricted Securities
At 30 September 2022, the Company had no restricted securities on issue.
(h) Approach to Corporate Governance
Manuka Resources Ltd ACN 611 963 225 (Company) has established a corporate governance framework
commencing from when the Company was admitted to the official list of ASX. In establishing its corporate
governance framework, the Company has referred to the recommendations set out in the ASX Corporate
Governance Council's Corporate Governance Principles and Recommendations 4th edition (Principles &
Recommendations). The Company has followed each recommendation where the Board has considered the
recommendation to be an appropriate benchmark for its corporate governance practices.
following governance-related documents can be
The
www.manukaresources.com.au, under the section marked "About Us > Corporate Governance":
found on
the Company's website at
Charters
• Board
• Audit, Risk and Sustainability Committee
• Nomination Committee
• Remuneration Committee
Policies and Procedures
• Corporate Code of Conduct
• Disclosure - Performance Evaluation
• Continuous Disclosure
• Risk Management Policy
• Trading Policy
• Diversity Policy
• Shareholder Communication Strategy
• Sustainability Policy
• Hedging Policy
• Whistleblower Policy
Manuka Resources Ltd
For the year ended 30 June 2022
91
For the financial year ended 30 June 2022 (Reporting Period) the Company has adopted the fourth edition of
the Corporate Governance Principles and Recommendations released by the ASX Corporate Governance
Council. The Company’s 2022 Annual Corporate Governance Statement has been approved by the Board and
is publicly available on the Company’s website at www.manukaresources.com.au/site/about/corporate-
governance. It will also be released to the ASX at the same time as this 2022 Annual Report.
(i) Use of Proceeds
The Company was admitted to the official list of the ASX on 11 July 2020. In accordance with Listing Rule
4.10.19, the Company has, during the financial year ended 30 June 2022, used cash and assets in a form readily
convertible to cash, in a way consistent with its business objectives.
Manuka Resources Limited
Level 4, Grafton Bond Building,
201 Kent St, Sydney, NSW Australia, 2000