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Executive Chairman
Director
Director
DIRECTORY
Directors
Paul Poli
Franciscus (Frank) Sibbel
Andrew Chapman
Company Secretary
Andrew Chapman
Registered Office
Suite 11,
139 Newcastle Street
PERTH WA 6000
Tel: (08) 9230 3555
Fax: (08) 9227 0370
Email: reception@matsa.com.au
Postal Address
PO BOX 376
Northbridge W.A. 6865
Website
www.matsa.com.au
Share Registry
Advanced Share Registry Services
110 Stirling Highway
Nedlands WA 6009
Tel: (08) 9389 8033
Fax: (08) 9262 3723
Home Stock Exchange
Australian Securities Exchange Ltd
Level 40, Central Park
152-158 St George’s Terrace
Perth WA 6000
ASX Code: MAT
Auditors
Nexia Perth Audit Services Pty Ltd
Level 3
88 William Street
PERTH WA 6000
MATSA RESOURCES LIMITED - CONTENTS
CORPORATE DIRECTORY
CHAIRMAN’S REPORT
OPERATIONS REVIEW
DIRECTORS’ REPORT
AUDITOR’S INDEPENDENCE DECLARATION
FINANCIAL STATEMENTS
-
-
-
-
-
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 and Forming Part of the Consolidated Financial Statements
DIRECTORS’ DECLARATION
INDEPENDENT AUDIT REPORT
ADDITIONAL ASX INFORMATION
SCHEDULE OF MINING TENEMENTS
1
3
4
31
44
45
46
47
48
49
92
93
96
101
MATSA RESOURCES LIMITED - CHAIRMAN’S REPORT
2020 ANNUAL REPORT · PAGE 3
Dear Shareholder,
In writing this year’s report, I thought I would reflect on what I wrote last year, and what really
appealed to me was my comment regarding “The Team”, in that how reliant our whole company is on
each individual person that makes up the Matsa team.
I, nor anyone, could foresee how important this team attribute, the group made up of individuals
working together to achieve a goal, would matter to us as shareholders this year. I proudly observed
how our team, the whole Matsa team, took on the Covid-19 planning offensive. How proudly I watched
them put their other team members and the company first. How we adhered to our new protection
mechanisms and rules which we instigated together to protect all team members and our ambitious
plans going forward.
For me, this is our greatest achievement this year, we coped with whatever nature threw at us, we in
fact excelled at it, and I am sure that we can continue to grow with whatever challenges are thrust
upon us.
It is important to recognise the twin boom drillers, the underground truck and plant operators, the
chargers, the cleaners/caterers, the geologists, engineers, all the admin people and safety officers.
Our surface exploration geologists and of course the team in the Perth office, as well the great job the
Thailand team have done in managing all the geological data for our operations in Australia.
These are the real people that we need to thank this year, and I am sure all shareholders join me in
appreciating their efforts.
We look forward this year to growing the Red October operations, and developing Devon and also
finding a pathway forwards for our valuable Fortitude gold mine. Whilst we work diligently towards our
strategy of becoming a mid-tier gold producer, we will also strongly focus on our exploration activities
which will grow and build our company. We have an exceptional tenement package.
We can and we will achieve all in a safe, environmentally friendly and community minded manner.
The board looks forward to the next year and what it will bring.
PAUL POLI
PAUL POLI
PAUL POLI
EXECUTIVE CHAIRMAN
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2020 ANNUAL REPORT · PAGE 4
INTRODUCTION
Matsa Resources Limited (“Matsa” or “the Company”) is an ASX listed exploration and gold mining
company operating in the north eastern goldfields of Western Australia. The corporate office is located
in Perth, Western Australia with also an office in Bangkok, Thailand.
Matsa is pleased to present its report on its activities during FY2020.
The Company’s activities during the year under review were principally focused within its 563km2
Lake Carey project which includes the Red October gold mine, Devon gold mine and the Fortitude
gold mine as well as several highly prospective exploration targets. Underground mining commenced
at Red October during April 2019, and has been continuous since that date with the production profile
increasing over time.
The Company is committed to progressing towards becoming a mid-tier gold mining company.
Mining studies into the viability of commencing the Stage 2 mine at Fortitude were finalised during
the year with production options being evaluated.
REVIEW OF OPERATIONS
Lake Carey Gold Project
Activities during the year were focused on:
• Development and increased ore production at the Company’s high grade underground
Red October gold mine while continuing to explore for new resources within the mine.
• Studies into the viability of the Fortitude Stage 2 open pit mining operation with a view to
bringing this mine into production as soon as an ore treatment option has been determine.
• Drilling high priority exploration targets notably Fortitude North, Devon, Olympic, Hill East,
New Year’s Gift and FF1.
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2020 ANNUAL REPORT · PAGE 5
FIGURE 1: Lake Carey Gold Project
RED OCTOBER GOLD MINE
Mining commenced at the 100% Matsa owned and operated Red October underground gold mine.
Production and Development Summary
Mining and development continued during the year with a summary of production shown in Table 1.
During the earlier part of the year, ore production was sourced from development drives. The component
of ore from stoping panels has increased progressively with a general increase in production evident
with the exception of the December 2019 quarter where mining was focused primarily on development.
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2020 ANNUAL REPORT · PAGE 6
SEPT 2019
QUARTER
ACTUALS
DEC 2019
QUARTER
ACTUALS
MARCH 2020
QUARTER
ACTUALS
JUNE 2020
QUARTER
ACTUALS
TOTAL YTD
12 MONTHS
11,142
5.40
1,936
MINE PRODUCTION
Total Tonnes
Grade (g/t)
Production (oz)
ORE SALES
Tonnes
Grade (g/t)
Ore Sales (oz)
Met Recovery (%)
Recovered (oz)
Stockpiled Ore (oz)
Avg Gold Price (A$/oz)
Cash (C1) Costs (A$/oz) N/A
AISC (A$/oz)
3,868
6.59
820
85%
697
-
2,183
1,277
4,579
4.07
599
10,841
4.46
1,556
86%
1,338
-
2,149
N/A
3,122
16,036
3.36
1,734
8,124
2.86
748
85%
636
-
2,578
1,969
2,372
23,320
4.22
3,162
25,993
3.97
3,322
87%
2,890
877
2,621
1,458
2,145
55,076
4.2
7,431
48,826
4.11
6,445
86%
5,560
-
2,375
N/A
2,051
TABLE 1: Red October Gold Production Summary for 12 Months to June 30th 2020
* Previous published quarter results have been adjusted for subsequent receipt of updated tonnages, grades and/or metallurgical recoveries. Figures
may not be precise due to rounding. Differences between production and salesrepresents ore mined and on the ROM pad at the end of each quarter.
Mining activities at Red October during the year can be summarised as follows:
September Quarter 2019
• Production was sourced from development drives designed to access high grade ore. Waste and
ore development were undertaken on the N1260 Red October Shear Zone (ROSZ) the N-1290
ROSZ and other ancillary ore development drives, eg. Smurfette. The N-1277 access to the ROSZ
was also commenced to enable South and North development and delineation of the current
planned mining block. The development confirmed the presence of narrow, high grade lodes in
the hangingwall of the ROSZ (Pegleg, Jaunty, HW 362). Several cuts yielded grades within the
ROSZ greater than 30g/t which contributed to an average production gold grade for the quarter
of 5.39 g/t Au.
• The Smurfette 322 lode was developed on the N-1290 and N-1255 levels, with both drives
intersecting high-grade ore containing >30g/t Au.
December Quarter 2019
• Mining during the December 2019 quarter was focused on development with production from
drives designed to expedite access to high grade stoping ore. This strategy has bolstered the
long-term mining plan for Red October. There was no stoping during the quarter which resulted
in fewer ounces being produced compared to the previous quarter.
• Development was completed on the N-1240 level, with the drive providing exploratory development
for another grade shoot to the north. The drive also defined the bottom edge of the ROSZ North
shoot (Figure 2).
• Development of the N-1275 and N-1290 ROSZ levels progressed along a high-grade shoot,
which was discovered by Matsa’s drilling in the previous year within the high grade ROSZ North.
Several areas were identified for stoping.
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2020 ANNUAL REPORT · PAGE 7
FIGURE 2: Long section looking West (mine grid) –
ROSZ block model showing grade Au >1g/t
March Quarter 2020
• There was a focus during the quarter on achieving sustained stope production which commenced in
earnest in mid-February 2020. The N-1290N was the primary stope delivering a large proportion
of stope production during February and March 2020.
• A stope drilling campaign by Perseverance Drilling at the N-1290N and the N-1275N stoping
blocks opened multiple stope horizons for mining.
• Operations moved to double shift with mining on a 24hr cycle, which achieved a significant
increase in production while significantly improving equipment utilisation.
• Lateral development during the quarter focussed on ore zone extensions directly beneath areas
previously mined by Saracen Mineral Holdings Limited (“Saracen”) (ASX: SAR). Mining continued
through the Red October Shear Zone (ROSZ) in both the north and central zones (Figure 3).
• Production (stoping) of the ROSZ lodes on the N-1290 level continued, and stoping on the
N-1275 level commenced. The ROSZ North stoping front is a key part of the mining plan.
• The ROSZ Central area became a key part of the mine plan to continue providing development
and production areas. Most activity during the quarter took place on the N-1240 level, with some
development also of the N-1225 and N-1255 levels (Figure 3).
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2020 ANNUAL REPORT · PAGE 8
FIGURE 3: Longitudinal Projection showing ROSZ Central and ROSZ North (Au >1g/t)
June Quarter 2020
• The Red October underground operations continued to increase and stabilise production, and
important mining faces were established on both the north and south declines.
• Stoping during the quarter focused on established stoping panels with gold grades generally
meeting or exceeding expectations. The majority of stope production came from the northern
decline (ROSZ North, ROSZ Central) where drilling and development was completed during the
March 2020 quarter.
• Production (stoping) of the ROSZ lodes on the N-1290 level continued. The ROSZ North stoping
front is a key part of the mining plan and continued delivering tonnes next quarter.
• The ROSZ Central area is a key part of the mine plan and continued providing development and
production areas. Most activity during the quarter took place on the N-1240 and N-1225 levels
(Figure 3).
• Development on the N-1240 level, with a strike drive developed along the ROSZ lode is directly
underneath the Saracen-mined N-1255 level, with a potential stope panel between them.
Importantly, the development also enables access to mine towards the narrow, high grade
HW-363 lode.
• The Smurfette-322 and ROSZ Central lodes were accessed on the N-1225 level during the
quarter. Development of these lodes to establish more stoping panels for future mining will be a
focus for Matsa.
• Future stoping plans include the Smurfette-322 which was accessed on the N-1255 level.
A stope void on the level below has been back-filled to allow further development and stoping
of this high-grade lode.
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2020 ANNUAL REPORT · PAGE 9
• Accessing the South Decline side of the mine is an opportunity for Matsa to mine a number of
lodes and open up new areas which included Smurfette and Dory.
• Matsa has accessed the Smurfette-320 on the S-1042 level, with the aim of extending both
levels towards some significant drilling intercepts and assess potential for stoping (Figure 4).
Nearby lodes will also be assessed for development potential.
FIGURE 4: S-1064 and S-1042 levels Smurfette 320 development to date
• Development to access the narrow, high grade Dory lode progressed during the quarter. By
quarter’s end, the ore drives are ready to commence, aiming to replicate the high grades mined by
Saracen on the S-1095 level above.
• All mining areas performed above expectations as reflected in Table 1.
• With operations stabilised, the focus for the Red October team will be to progress identified
opportunities in the 922 and 823 mining levels in the September 2020 quarter.
RED OCTOBER NEAR MINE EXPLORATION
Underground Diamond Drilling
Matsa completed 11 underground diamond drill holes during the year, for a total of 1,451m focussing
on extensions in the main mining area (ROSZ North).
Drill holes are located in plan and section views in Figures 5 and 6 below.
Drilling has produced outstanding gold assays and confirms the high-grade potential of the Red
October gold mine with results summarised as follows:
• The discovery of new high-grade lodes which are not reflected in the June 2016 Resource model
is significant. The high-grade lodes indicate the strong potential for more ore-bearing structures
to be discovered to the north by further drilling.
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2020 ANNUAL REPORT · PAGE 10
• These new lodes were prioritised for further evaluation as new opportunities outside of the
known lode system.
• Confirmation that another high-grade shoot exists within the ROSZ, further to the north.
This new high-grade domain (ROSZ Costello) is a compelling mining area which warrants
further follow-up.
FIGURE 5: Long Section View - Grade Control drill holes as red traces (RO Local Grid)
The drilling programme was carried out as the first part of a longer-term campaign aimed at significantly
increasing the gold resource at the Red October underground gold mine.
Drilling was carried out on the Red October Shear Zone (ROSZ) North with the following objectives:
• A total of 8 holes (ROGC724 - ROGC731) were drilled to better understand the potential for
high-grade shoots below the current workings and to test for additional high-grade shoots to
the north.
• A total of 3 follow-up holes (ROGC732 - ROGC734) were drilled selectively based on assays and
visually interesting geology.
The drilling programme was successful in better defining the ROSZ which is typically associated with
a number of footwall and hanging wall lodes as described below.
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2020 ANNUAL REPORT · PAGE 11
FIGURE 6: Plan view of Grade Control holes drilled - red traces (RO Local Grid)
Drilling Results Foot-wall lodes
Mineralised lodes in the footwall of the ROSZ were intersected, and exhibited carbonate alteration
with pyrite and quartz-calcite veinlets. The host rock (tholeiitic pillow basalts) in this area is highly
prospective as this brittle unit sits adjacent to more ductile high-magnesian basalts and ultramafic
units, forming a rheology contrast.
2.50m @ 48.70g/t Au from 78m – new lode (ROGC725)
Incl 1.10m @ 105.5g/t Au from 78m
1.00m @ 14.60g/t Au from 69m – new lode (ROGC732)
Drilling Results Hanging-wall lodes
A suite of narrow mineralised lodes was also intersected in the hanging wall of the ROSZ. The lodes
are situated in high-magnesium basalts, with carbonate alteration, pyrite and quartz-calcite veinlets.
These intersections are significant, as mining has occurred on similar lodes in the current ROSZ North
mining area.
0.98m @ 14.88g/t Au from 88.72m – new lode (ROGC733)
2.55m @ 4.89g/t Au from 93.2m – new lode (ROGC734)
Incl 0.20m @ 37.80g/t Au from 94.1m
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2020 ANNUAL REPORT · PAGE 12
Red October Shear Zone - Costello
Costello is one of several zones or swarms of grade shoots along the ROSZ throughout the mine which
include, from south to north, the 120 South, 130 Central, 110 Flo, ROSZ North, and Costello grade
shoots. Costello sits within the ROSZ and is located ~150m north of the ROSZ North mining area.
High grades evident in historic RC holes to the north of the ROSZ North mining area were tested with
3 drillholes (ROGC729 to ROGC731 inclusive).
The drillholes confirmed the presence of the ROSZ and also intersected the edge of the suspected
Costello high-grade shoot.
Drilling was targeted just south of the historic RC holes position, yielding:
2.10m @ 4.24g/t from 144.5m
ROSZ (ROGC729)
4.40m @ 3.30g/t Au from 135.14m
ROSZ (ROGC730)
6.00m @ 2.21g/t Au from 121.5m
ROSZ (ROGC731)
Incl 1.70m @ 4.07g/t Au from 122m
Typically, the ROSZ is associated with mineralised hangingwall and footwall lodes, which are currently
unquantified and offer further opportunities for the Costello area.
The ROSZ is made up of a sheared mafic package with a quartz breccia, pervasive pyrite and narrow
intercalated sedimentary units. Typical alteration seen was biotite, carbonate, silica and +/-sericite.
Surface Diamond Drilling
Diamond drilling was carried out to the NE and along strike from the Red October mine with 2 drill
holes completed for 714.6m of drilling.
Drilling was designed in support of an R&D project and will play a part in a number of experiments
focused on applicability seismic surveys in a near mine situation. Drilling targeted strike-extensions to the
high-grade Red October gold lodes >400m from current underground mining development which will also
be equipped with fibre optic cables and provide a platform of subsurface detection of seismic signals.
Drilling was also designed to test high priority structural targets developed from a geo-mechanical
study carried out in 2018.
They were also to support further seismic research activities under Matsa’s membership of the Minex
CRC where further experimentation is proposed to test cost effective alternatives to the technology
currently in use. See Nautilus 3D seismic survey by Curtin University outlined below.
Drillhole ROEX048 was designed to test the Eastern Break geo-mechanical target interpreted to be
at a depth of 310m to 330m. The drill hole intersected transported lake clays to 47.8m, saprolite to
86.3m before entering variably weathered basaltic volcanics which persisted to end of hole. A number
of zones of biotite, epidote and K feldspar alteration and quartz veining were recognised with trace
sulphides mostly pyrite observed to be associated with quartz veins. No obvious Red October style
mineralised zones were observed. This hole was successfully cemented with fibre-optic seismic cable.
Drillhole ROEX049 was designed to test the IFH geo-mechanical target and encountered transported
lake clays and a basal sandy palaeo-channel unit to 65.8m. Saprolite, below the transported cover
persisted to a depth of 97.4m before passing into variably weathered mafic volcanics. Narrow zones
of strongly sheared mafic/ultramafic volcanics with minor quartz veining and sulphides were observed
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2020 ANNUAL REPORT · PAGE 13
between 117.1m and 117.5m and between 151m and 153m. Several paler coloured zones of carbonate
alteration associated with moderate shearing. No obvious Red October style mineralised zones
were observed.
Fibre optic cable was grouted in place in both drill holes as part of upcoming Seismic R&D under Minex
CRC “Seismic in the Drilling Workflow” project of which Matsa is an associate member.
Red October Mine Supergene Target Surface RC Drilling
A total of 31 drill holes for 886m were completed on a near surface supergene target located within the
existing Red October mine. Drilling was designed to test remnant high grade supergene mineralisation
interpreted from previous drilling.
Results revealed no significant assays.
Stage 1 2D Seismic Survey Red October
Seismic surveys have been deployed extensively as a near mine exploration tool to map concealed
structures. Conventional seismic surveys are prohibitively expensive and Matsa’s support for ongoing
research is to develop technologies which have potential to be an order of magnitude lower in cost
compared to conventional surveys.
A 2D seismic survey was carried out in March 2020 which incorporated data recorded by distributed
acoustic sensing (DAS) cables, in 2 diamond drill holes. Surface geophones were also recorded for
comparison with data sensed by DAS cables.
Results were highly encouraging for mapping the geology of the Archaean basement at Red October
where both structural and stratigraphic elements were interpreted from the single 2D line completed.
The innovative use of DAS cabling achieved very high data densities compared with conventional
geophones. Matsa remains committed to this research project as holding potential to map structurally
and stratigraphically favourable targets for gold mineralisation, at greatly reduced costs compared
with conventional seismic surveys.
An innovative imaging approach utilising borehole DAS data and seismic interferometry is currently
undergoing tests. Main benefits of this approach are an improved resolution and substantially extended
image in lateral sense, when compared to conventional borehole imaging which has previously never
been tested in hard rock (igneous/metamorphic) environment.
Potential for mining to continue at Red October
Matsa considers that the Red October resource remains open and under-explored along strike and
down-dip. There is evidence of high-grade gold intersections within the existing drilling dataset, both
within and outside of the existing mine footprint.
Existing drill data strongly supports the idea that potential exists to continue mining:
• Within the existing resource wireframes, adjacent to existing workings and further afield
(Figure 7) ; and
• Outside the existing resource wireframes where potential is demonstrated by existing high- grade
drill results >10 g/t.
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2020 ANNUAL REPORT · PAGE 14
FIGURE 7: Red October, Longitudinal Projection with summary of high-grade gold
mineralisation >5g/t Au (RO mine grid co-ordinates) (June 2016 Saracen Resource Model)
New targets continue to be identified and prioritised for continuation of mining as mining progresses.
Exploration drilling both underground and from surface, will target new mineralisation and continue to
build the resource base.
FORTITUDE GOLD MINE
Fortitude Stage 2, as previously announced, is a 22-month open pit project, expected to produce
54,000 ounces of gold. All permits required to commence Stage 2 mining are in place. Matsa is
currently assessing processing options for the treatment of ore from Fortitude, and is in discussions
with a number of parties including AngloGold Ashanti Australia Ltd “AGAA”, which is currently treating
gold ore from Matsa’s nearby Red October underground gold mine under a five-year Ore Purchase
Agreement. (MAT Announcement to ASX 21st August 2019).
Activities at Fortitude during the year focussed on:
• Mineral Resource Estimate revised to 5,449,000 tonnes @ 2.0g/t Au (342,600 oz Au).
• Maiden ore reserve declared of 1,029,000 tonnes at 1.8 g/t for 58,100 oz gold.
• Completion of a comprehensive mining study which delivered highly encouraging results for
recommencement of open pit mining at Fortitude (MAT announcement to ASX 21st August 2019).
• Completion of a geotechnical drill hole.
• Metallurgical test work on stored diamond drill core samples from drilling completed in 2016.
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2020 ANNUAL REPORT · PAGE 15
Fortitude Mineral Resource Update
CSA Global consultants were contracted to carry out grade estimation for the Fortitude Mineral
Resource estimate. The Mineral Resource estimate has been updated to allow for depletion due to the
Stage 1 trial mining which was carried out in 2017 (Table 2).
FORTITUDE DEPOSIT 2019 MINERAL RESOURCE ESTIMATE (1 G/T AU CUT OFF)
Type
Oxide
Transition
Saprock
Fresh
Total
Indicated
Inferred
Total Resource
Tonnes
kt
222
377
227
2,119
2,945
Au
g/t
1.9
1.8
1.9
1.8
1.8
Tonnes
kt
51
125
1
2,326
2,503
Au
g/t
2.1
2.0
2.1
2.1
2.1
Tonnes
kt
273
502
228
4,445
5,449
au
g/t
1.9
1.8
1.9
2.0
2.0
Au
Oz
16,900
29,700
14,100
282,000
342,600
TABLE 2: Fortitude Gold Project Mineral Resource Estimate
*Figures have been rounded in compliance with the JORC code. Rounding errors may cause the column not to add up. Mineral Resources are reported
in situ (undiluted). Mineral Resources are reported to a cut-off grade of 1g/t Au.
Sections 1, 2 and 3 JORC tables for the Mineral Resource estimate have been announced in full
(MAT announcement to ASX 21st August 2019)
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2020 ANNUAL REPORT · PAGE 16
Competent Persons Statement
The information in this report that relates to Mineral Resources has been compiled by Matthew
Cobb, who is a full-time employee of CSA Global Pty Ltd, and Richard Breyley who is a fulltime
employee of Matsa Resources Limited. Dr Cobb is a Member of both the Australian Institute of
Geoscientists and the Australian Institute of Mining and Metallurgy. Mr Breyley is a member of
the Australian Institute of Mining and Metallurgy. Both Dr Cobb and Mr Breyley have sufficient
experience relevant to the style of mineralisation and type of deposit under consideration and
to the activities which they are undertaking to qualify as a Competent Persons as defined in the
JORC Code (2012). Dr Cobb and Mr Breyley consent to the disclosure of this information in this
report in the form and context in which it appears.
Cautionary Statement
This belief is expressed in good faith and believed to have a reasonable basis.
The material in this announcement is intended to be a summary of current and proposed
activities, selected geological data, as well as Mineral Resource estimates and Ore Reserves.
This data is based on information available at the time.
It does not include all available information and should not be used in isolation as a basis to
invest in the Company.
This announcement includes information and graphics relating to a conceptual mining study,
completed Mineral Resource estimate and a scoping study and includes “forward looking
statements” which include, without limitation, estimates of gold production based on mineral
resources that are currently being evaluated.
While the Company has a reasonable basis on which to express these estimates, any forward
looking statement is subject to risks, uncertainties, assumptions and other factors, which could
cause actual results to differ materially from future results expressed, projected or implied by
such forward-looking statements.
Risks include, without limitation, gold metal prices, foreign exchange rate movements, project
funding capacity and estimates of future capital and operating costs.
The Company does not undertake to release publicly any revisions to forward looking statements
included in this report to reflect events or results after the date of this presentation, except as
may be required under applicable securities regulations.
Any potential investor should refer to publicly available reports on the ASX website and seek
independent advice before considering investing in the Company.
Fortitude Gold Mine Stage 2 Ore Reserves
The total Ore Reserve for the Fortitude Stage 2 mining study is 1,029,000t @ 1.8g/t (58,100 oz Au).
The entire Ore Reserve is classified as Probable under the JORC 2012 code (Table 3).
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2020 ANNUAL REPORT · PAGE 17
FORTITUDE DEPOSIT 2019 ORE RESERVE STAGE 2 MINING OPERATION (1 G/T AU CUT-OFF)
Type
Oxide
Fresh
Total
Proven
Probable
Total
Tonnes
kt
-
-
-
Au
g/t
-
-
-
Tonnes
kt
141,000
611,000
1,029,000
Au
g/t
1.8
1.8
1.8
Tonnes
kt
141,000
611,000
1,029,000
au
g/t
1.8
1.8
1.8
Au
Oz
8,000
36,200
58,100
TABLE 3: Fortitude Stage 2 Gold Mine Ore Reserve Statement
* Figures have been rounded in compliance with the JORC code. Rounding errors may cause the column not to add up precisely.
** Ore Reserves are reported inclusive of marginally economic material and diluting material delivered for treatment (diluted).
*** Ore Reserves are reported to a cut-off grade of 1g/t Au.
Dilution parameters applied to the Mineral Resource estimate as modifying factors for Reserve
calculation include a mining loss of 5% and dilution of 10% at zero grade. This is considered appropriate
for the open pit operation.
The reported Ore Reserve estimations are considered representative on a global scale.
Competent Persons Statement
The information in this report that relates to Ore Reserves has been compiled by Franciscus
Sibbel who is a non-executive director of Matsa Resources Limited. Mr Sibbel is a Fellow Member
of the Australian Institute of Mining and Metallurgy. Mr Sibbel has sufficient experience relevant
to the style of mineralisation and type of deposit under consideration and to the activities which
they are undertaking to qualify as a Competent Persons as defined in the JORC Code (2012).
Mr Sibbel consents to the disclosure of this information in this report in the form and context
in which it appears.
Mine Design and Scheduling
The study demonstrates that under the current market conditions, Fortitude can be economically
mined. Individual aspects of the study included:
• A geotechnical assessment was completed by Peter O’Bryan and Associates; and
• An optimisation study was completed by Orelogy using a gold price of A$1,700 per ounce and
industry based costs.
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2020 ANNUAL REPORT · PAGE 18
Fortitude Stage 2 Mining Study Key Outcomes
The mining study strongly indicates potential for immediate commencement of Stage 2 mining
(Figure 8) with the following key outcomes:
• Total Indicated and Inferred Mineral Resources at Fortitude stand at 5,449,000 tonnes @ 2.0g/t
Au (342,600 oz Au).
• A maiden ore reserve of 1,029,000 tonnes at 1.8 g/t for 58,100 oz gold was declared with
excellent potential for a substantial increase in the near term.
• Total cash surplus A$21.8M over 22 months.
• Total production of 54,400 oz gold at 93% recovery.
• Capital outlay A$6.6M which includes pre-stripping.
• Operating cash cost of A$1,628/oz gold.
• Assumed average gold price of A$2,150.
• Total material movement 5.85M bank cubic metres (bcm’s) at a waste to ore ratio of 14.4.
• All statutory and regulatory approvals are in place for the immediate commencement
of mining.
• A sensitivity analysis indicates that the Fortitude Gold Mine Stage 2 project is robust with
potential for improvement to the financial model as new optimisations come to hand. Finalisation
of discussions with key parties and completion of the tender process may deliver further
improvements.
• Metallurgical test work indicates that Fortitude ore is amenable for treatment at any of the
nearby processing facilities, and will deliver very good-to-excellent gold recoveries with no
deleterious elements.
FIGURE 8: Fortitude Stage 2 Mining Project Summary
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2020 ANNUAL REPORT · PAGE 19
Metallurgical Test-work Results
The Fortitude Stage 2 metallurgical test-work programme was developed using representative
processing protocols for transitional sulphide/oxide and primary sulphide ore types. Composite samples
were obtained from approximately 130kg of HQ diamond drill core. Results of the metallurgical test
work are summarised as follows:
• Comminution characterisation test-work confirmed a low Bond Ball Mill Work Index demonstrating
no grinding issues with Fortitude transitional and fresh ore types.
• Gravity Au recovery demonstrated gold extraction between 23% and 51%.
• Flotation tests were conducted with consistent gold recoveries between 39% and 56% to the
flotation concentrates.
• Gravity-cyanidation tests showed material responded well to low cyanide levels.
• Combined gravity and flotation concentrate recoveries are seen to be between 81% and 94%,
which is an excellent result and in agreement with feasibility study assumptions.
Geotechnical Diamond Drilling
During the year an additional geotechnical diamond drill hole 19FGT01, was completed to test the
design of northern wall of the Stage 2 open pit at Fortitude mine (Table 4).
Prospect Hole_ID
Peg-ID
Lease ID
North
East
Dip
Azimuth
M-Total
Fortitude 19FGT01
M39/1065
456950
6757175
-60
270
102
TABLE 4: Fortitude Geotechnical Drill Hole Collar and Setup Information
Because of the highly weathered nature of basement, a down-hole tele-viewer survey was carried
out to provide structural information. The structural interpretation led to a minor change to the pit
design parameters in the scoping study to minimise the likelihood and extent of block sliding. Slight
modifications on pit design had minimal effect on the overall scoping study mining parameters.
Fortitude Gold Mine Other
A final review of hydrology data from the Stage 1 trial mine was completed in preparation for the
mining tender.
Matsa continued to assess processing options for the treatment of ore from Fortitude.
LAKE CAREY EXPLORATION
Exploration at Lake Carey during the year under review comprised a major exploration programme was
carried out during the year with the following activities carried out:
• 16 RC drill holes were completed for 1,924m at Cardinal/Wilga Dam, Devon and Olympic targets.
• 39 RC drill holes for 1,416m were completed at the Hill East.
• 7 RC Drill holes for 352m were completed at New Years Gift.
• 1 RC drillhole for 84m was completed at Gallant, with no significant results and programme
stopped because access to the prospect was prevented by flooding.
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2020 ANNUAL REPORT · PAGE 20
• 14 aircore drill-holes for 1,520 m and discovery of FF 1 Gold prospect 2km north of Fortitude North.
• 7 diamond drill holes were completed for a total of 1,837m at Fortitude North.
• A total of 1,275 bottom of hole samples from historic aircore drilling were submitted for multi-
element assay.
• 244 ultrafine soil samples collected over three target areas.
• Botanical survey over planned drill sites at two targets.
• Stage 2 3D Distributed Acoustic Sensor (DAS) Seismic Survey Nautilus Project.
• Resource Potential Review of Devon gold mine by CSA Global.
RC Drilling Devon Mine
A total of 5 diamond holes for 733m to evaluate resource potential beneath the existing open pit and
extensions to historic gold workings occurred during the quarter.
Highly encouraging results were received during January 2020 with 4 out of the 5 RC drillholes at
the Devon mine returning excellent gold intercepts of which 3 are located at depth on the moderately
dipping Devon Main Lode, and one intercept in a steeply dipping hangingwall lode as follows (Figure 9):
Main Lode
2m @ 21 g/t Au from 93m
1m @ 6.24 g/t Au from 106m
2m @ 19.1 g/t Au from 105m
19DVRC001
19DVRC002
19DVRC005
and 1m @ 3.01 g/t Au from 110m
Hanging Wall Lode
8m @ 27 g/t Au from 25m
19DVRC003
incl. 3m @ 8.32 g/t Au from 25m
and 2m @ 94 g/t Au from 29m
These results are highly encouraging because:
• Main lode intersections confirm the continuation of high-grade gold mineralisation below
previously mined high-grade open pit. Previous drilling at Devon was mostly above 300m RL.
• Mineralisation at Devon occurs as high-grade sulphide rich shears and quartz veins within a
moderately dipping zone (Main lode zone) which remains highly prospective at depth. The complex
structural setting at Devon, holds excellent potential for structural repetitions of the main lode
zone and associated mineralised structures.
• Devon is an active mine site on care and maintenance and the approvals process to recommence
mining is expected to be straightforward.
• Previous open pit mining was carried out to the limits of the mining lease boundary. A third party
owned the area surrounding the mining lease. Matsa acquired all leases which removes this restriction.
• The Hangingwall lode was not previously mined and these new results illustrate potential for new
resources at Devon.
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2020 ANNUAL REPORT · PAGE 21
FIGURE 9: High Grade Gold Intersections Devon Mine and Olympic Prospects
Olympic Workings
The Olympic project is a new exploration target previously unexplored by Matsa and only 800m west
of Devon gold mine. A total of 8 drill holes for 833m were completed under and adjacent to historic
gold workings which are located 800m west of the Devon gold mine (Figure 9).
The Olympic prospect is located 8km south of Red October and 800m west of Devon and is centred
on a variable thickness (average 1m) quartz-sulphide bearing shear zone striking NNW and dipping
75° east over a current strike length of 500m. The shear is proximal and sub-parallel to the western
contact of a felsic porphyry dyke within a sequence of meta-sediments and carbonated intermediate
to mafic volcanics.
Previous drilling has included very high-grade intersections including 4m @ 24.5g/t Au and 4m @
285 g/t Au.
The drilling programme was designed to test depth extension from previous high-grade drill intercepts
from the 1980s. The trend is largely untested at depths below 50m and between the major historical
workings. The Olympic and Danube mines were worked discontinuously from 1897 to 1920’s. Available
historical production reports total 1,436 tonnes @ 39 g/t for 1,805 ounces of gold.
Drilling along the Olympic lode trend returned excellent gold intercepts including:
8m @ 6.94 g/t Au from 80m
Incl. 3m @ 16.3 g/t Au
2m @ 16.6 g/t Au from 74m
Incl. 1m @ 28.6 g/t Au
1m @ 4.57 g/t Au from 60m
1m @ 4.10 g/t Au from 30m
19ODRC005
19ODRC001
19ODRC008
19ODRC007
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2020 ANNUAL REPORT · PAGE 22
OLYMPIC AND DEVON EXPLORATION POTENTIAL
Previous tenement boundary limitations have resulted in the prospectivity of the area between Olympic
and Devon not being tested by drilling.
Matsa’s acquisition of the entire area provides an opportunity to efficiently and effectively explore the
between and along strike of these two mineralised systems. The recent high-grade results from drilling
the hanging wall lode at Devon supports the potential for further high-grade lodes to exist between
Devon and Olympic areas and provides encouragement to carry out further exploration including drilling.
RC Drilling Cardinal
Drilling was carried out in the central part of a regional gold anomaly defined by WMC and later
Exodus Minerals. The anomaly which is located 2km east of Sunrise Dam gold mine has been defined
by soil geochemistry and RAB aircore drilling over an NNW trending strike extent of >8km. Previous
drilling results have included a number of highly anomalous gold values in basement >1 g/t.
Three shallow RC drill holes for 358m were completed to test a structural/stratigraphic target which
is interpreted to be favourable for gold mineralisation.
Drilling encountered variably sheared metabasalt with a number of weakly sulphidic quartz veins.
Best results include 6m @ 0.34 g/t Au from 98m in 19MTWRC08, which do not coincide with
significant alteration or quartz vein development.
Despite extensive past drilling, this target remains of interest to Matsa. Next steps include an IP
survey to address key structural targets associated with anomalous gold values.
FORTITUDE NORTH DIAMOND DRILLING
A total of 7 diamond drill holes (20FNDD02 – 20FNDD08) were completed during the quarter for a
total of 1,837m of drilling. Final assay results were received during the quarter for all drilling carried
out to date. Descriptions of drilling, logging, sampling procedures and key assay results were included
in 2 announcements during the year (MAT Announcements to ASX 19th February 2020 and 30th
March 2020).
Assay results confirmed the presence and continuity of primary gold mineralisation over a distance of
800m within the 1,500m long basement (aircore) gold anomaly, with the remainder to be tested. The
basement gold anomaly remains open to the south (Figure 10).
Key results include the following summary intercepts:
10.3m @ 3.48 g/t Au from 124.6m 20FNDD04
20FNDD02
4m @ 13.63 g/t Au
from 79m
20FNDD03
3.4m @ 12.3 g/t Au
from 64m
20FNDD03
17.2m @ 3.4g/t Au
from 73m
from 183.4m 20FNDD05
4.6m @ 5.15 g/t Au
from 212.6m 20FNDD06
7.9m @ 1.89 g/t Au
20FNDD08
from 137m
4.7m @ 1.31 g/t Au
2m @ 8.11g/t Au
from 223.5m 20FNDD08
10.3m @ 3.48 g/t Au from 124.6m 20FNDD04
20FNDD02
4m @ 13.63 g/t Au
from 79m
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2020 ANNUAL REPORT · PAGE 23
FIGURE 10: Fortitude North drill hole location and summary results (new results in red)ts
The drill results confirmed continuity of a zone of basement mineralisation 800m in length, which
represents just over half of the 1,500m strike extent of basement gold mineralisation defined by aircore
drilling. This gold mineralisation is interpreted to occur in a broad continuous moderately to steeply
dipping zone of albite-carbonate altered basalt and associated mostly steeply dipping quartz veins.
At shallower depth, within the saprolite profile, gold mineralisation has undergone deep weathering
resulting in a number of very high-grade intercepts through mobilisation and enrichment by supergene
processes. Mineralised intercepts in aircore drilling and in the upper parts of drill holes 20FNDD02,
20FNDD03 and 20FNDD04 include supergene mineralisation which has been modified by weathering
processes. These shallow intercepts together with high grade intercepts in unweathered basement
such as 4.6m @ 5.15 g/t Au in 20FNDD05 provide strong encouragement for the presence of further
high-grade mineralisation at Fortitude North.
Mineralisation at Fortitude North occurs in a mafic sequence made up of basalts and dolerites
containing thin lenses of laminated shale, located immediately east of the Fortitude Fault zone (Figure
10). The Fortitude Fault represents a major tectono-stratigraphic boundary between dominantly
basaltic volcanics which host the mineralisation at Fortitude North to the east and dominantly
intermediate volcanics to the west.
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Deeply weathered basement rocks are overlain by approximately 40m of Tertiary lake sediments.
There appear to be 2 styles/end-members of gold mineralisation at Fortitude North, namely:
• Auriferous quartz veins and pyritic crackle veins within a distinctive broad zone of bleached albite-
carbonate altered basalt up to 30m wide.
•
Individual anastomosing auriferous quartz vein sets outside the main altered zone.
Quartz veining and pyritic crackle veining over downhole widths of up to 10m in altered basalt account
for most of the mineralised intercepts. The albite-carbonate alteration “envelope” is distinguished by
its cream to pale brown colour in contrast to the dark olive-green colours of the enclosing basalts
and dolerites. Narrow shale bands have been observed within and adjacent alteration and mineralised
quartz veins. Higher grade gold assays within the altered zone are associated with an increase in
quartz veins and intensity of irregular pyritic crackle veinlets and disseminations.
All diamond drill holes completed to date intersected this distinctive zone of albite-carbonate alteration.
HILL EAST RC DRILLING
RC drilling was focused on 6 targets designated HE 1 – HE 6 (Figure 11). Each of these targets is
typically ~200m long and drilling was carried out at comparatively close spacing, with the objective
of determining continuity and extent of shallow mineralisation and to evaluate the potential for near-
term development as satellite deposits to Matsa’s Red October Mine. As previously announced, this
drilling achieved significant mineralised intercepts at shallow depth in 5 of the 6 targets tested with
key intercepts as follows:
Target HE4 5m @ 4.01 g/t Au from 6m
9m @ 3.04 g/t Au from 0m
12m @ 1.96 g/t Au from 2m
6m @ 3.43 g/t Au from 15m
2m @ 7.14 g/t Au from 7m
3m @ 6.82 g/t Au from 15m
1m @ 13.3 g/t Au from 21m
Target HE2 4m @ 3.29 g/t Au from 4m
7m @ 1.53 g/t Au from 20m
Target HE1 27m @ 2.04 g/t Au from 2m
3m @ 2.23 g/t Au from 28m
Target HE3 2m @ 2.68 g/t Au from 0m
1m @ 4.06 g/t Au from 39m
6m @ 1.33 g/t Au from 0m
Target HE5 4m @ 6.3 g/t Au from 13m
13m @ 1.86 g/t Au from 0m
(20HERC001)
(20HERC002)
(20HERC003)
(20HERC005)
(20HERC007)
(20HERC007)
(20HERC008)
(20HERC027)
(20HERC028)
(20HERC032)
(20HERC033)
(20HERC015)
(20HERC018)
(20HERC026)
(20LBRC003)
(20LBRC004)
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2020 ANNUAL REPORT · PAGE 25
FIGURE 11: Fortitude North drill hole location and summary results (new results in red)ts
The Hill East group of exploration targets are a subset of the extensive historic Linden gold workings
and include small scale historic workings which have been the focus of mostly shallow drilling by previous
explorers. The Hill East targets are located 2km SE of the Devon gold mine, 6km west of Fortitude gold
mine, 9km SW of Fortitude North and 10km S of Red October gold mine. Gold mineralisation is associated
with auriferous quartz veins in a background of complexly deformed basalts, dolerites, ultramafics and
minor sediments, which have been extensively intruded by felsic porphyry sills and dykes. Basement rocks
at Hill East are variably weathered with a thin veneer of unconsolidated, mostly residual cover.
The 4 eastern targets (HE 1 - HE 4), are the focus of a very strong NS oriented 1.5km long gold
geochemical anomaly. Further exploration including ground geophysical surveys is planned to explore
this target for a much larger, deeper body of gold mineralisation associated with the small near surface
deposits currently under investigation.
NEW YEARS GIFT RC DRILLING
New Years Gift comprises historic gold workings located between Hill East and Devon Mine on a small
lake along the edge of Lake Carey (Figure 1). Historic workings are developed over about 150m along
a NS oriented mineralized zone comprising quartz veins up to 1.5m thick, in moderately weathered
dolerite and minor felsic porphyry bodies.
A total of 7 close spaced angled RC drill holes were completed for a total of 352m and were designed
to test a target dipping moderately towards the east as a potential shallow near-term development
opportunity similar to the targets at Hill East.
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2020 ANNUAL REPORT · PAGE 26
Drilling, sampling, logging and assay protocols are described in the recent announcement on Hill East
(MAT announcement to ASX 27th April 2020).
First pass assays were carried out on 3m composite samples. Stage 2 assays were carried out on cone
split 1m samples.
Two narrow high-grade intercepts were achieved as follows:
1m @ 19.4 g/t Au from 44m
1m @ 10.4 g/t Au from 35m
20NYGRC06
20NYGRC07
While drilling has downgraded the near term development potential at New Years Gift, the project
lies within an area which has been prioritised for ground geophysical surveys targeting deeper
mineralisation.
FF 1 AIRCORE DRILLING AND DISCOVERY OF NEW GOLD MINERALISATION
During the year, Matsa carried out an aircore programme comprising 14 drill-holes for 1,570m of
drilling designed to test a target along the Fortitude Fault, approximately 2.5km north of Fortitude
North, where drilling by previous explorers had been mostly unable to reach basement because of
difficulty penetrating loose sands and gravel at the base of the transported cover sequence.
Anomalous gold values were returned in 7 drill holes and include intercepts in basement and in the
overlying transported cover. Drilling, logging, and sampling procedures together with a summary of
drilling results was previously announced (Matsa Announcement to ASX 27th February 2020).
Significant results were returned in a number of drill holes including 2 drill holes located 300m apart,
which intersected anomalous gold values >0.1 g/t Au in basement rocks, with one intercept of 3m @
1.49 g/t Au from 108m to end of hole (EOH) in drill hole 20FFAC04 (Figure 12).
Highly anomalous gold values between 0.2 g/t Au and 0.24 g/t Au were also intersected in sandy
transported cover between the two basement intersections, which probably represent the products of
erosion of primary gold mineralisation in basement.
Two other anomalous basement gold intercepts with values >0.1 g/t Au at EOH were achieved in drill
holes 20FF1AC09 and 20FF1AC12.
The litho-structural setting of FF1 along the faulted boundary between basaltic volcanics to the east
and intermediate and felsic volcaniclastics and intrusives to the west, is very similar to the setting for
both the recent Fortitude North gold discovery and Matsa’s Fortitude gold mine to the south. Matsa
believes that this similarity is very significant and highlights the Fortitude Fault zone, which extends
over the full extent of the Lake Carey gold project from north to south, as an important “gold trend”
in this highly prospective district.
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2020 ANNUAL REPORT · PAGE 27
FIGURE 12: FF 1 summary, location and interpreted basement geology
SURFACE SAMPLING
Bottom of Hole Sampling
A total of 1,383 bottom of hole (BOH) samples from historic aircore drill holes over a number of
exploration target areas were submitted for multi-element analysis from different targets in the Lake
Carey and Red October project areas. These samples were selected as being representative of the
deepest and consequently least weathered part of each drill hole. Discovery of gold mineralisation at
FF 1 has underlined that a significant number of historic drill holes did not penetrate to basement due
to drilling difficulties in transported cover
Multi-element assays and mineralogical scans are being interrogated to provide accurate and accurate
picture of bedrock geology as well as highlighting areas of hydrothermal alteration and potentially,
associated gold mineralisation. In conjunction with historic gold assays, this is expected to highlight
targets for further drilling.
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2020 ANNUAL REPORT · PAGE 28
Rock Chip Sampling Hill East
A total of 7 rock chip samples were collected from a series of old workings at the northern end of
the Hill East target which remain untested by drilling. Five of the 7 samples returned gold values >
1 g/t with a best result of 64.9 g/t Au near a historic shaft. Importantly, the workings are located
within a prominent 2km long regolith geochemical anomaly (Hill East Target) defined by previous
explorers. While near surface gold mineralisation associated with individual discordant EW quartz lodes
(HE 1- HE 4) has potential for near-term development of supergene mineralisation (MAT Announcement
to ASX 28th April 2020), the regional anomaly represents a potential stand-alone target for
deeper mineralisation.
Ultrafine Soil Sampling
Ultrafine soils is the name given to a new sample preparation and assay technique invented by
CSIRO. This technique has been commercialised and Matsa submitted 244 samples from 3 targets
to investigate the effectiveness of this technique in areas of interpreted shallow, patchy and mostly
windblown transported cover. Geochemistry in such areas using traditional sampling and assay
methods typically gave rise to highly variable and unreliable results.
Results from these 3 small surveys, will be assessed to determine whether this represents an effective
exploration technique over areas with shallow cover.
3D Distributed Acoustic Sensor (DAS) Seismic Survey Nautilus Project
This experimental survey commenced in early July 2020 and was designed to test the applicability of
low cost “fishing line” DAS cable technology over the NE trending Nautilus structure, which is located
about 2km north of and parallel to the Red October shear zone. Survey objectives are to:
• Overcome limitations related to electronic equipment; and
• Reduce the cost of seismic reflection method by an order of magnitude.
These “fishing line” DAS cables are to be laid out over lines approximately 1km long and 100m apart
and will act as acoustic sensors over approximately 1km2. Shooting from an acoustic energy source
will be carried out at 10m intervals along the survey lines achieving an extremely high data density
for interpretation.
Devon Review CSA Global
A desktop review of the Devon gold project was carried out by CSA Global during the year. The
review was focused on data quality, given multiple phases of drilling, and a re-examination of existing
geological and resource estimates and reports.
Recommendations arising from this review include:
• Carry out a revised mineral resource model including a number of historic drill holes which had
previously been excluded in earlier estimates.
• Conduct a preliminary optimisation using the updated mineral resource and current gold price
forecasts.
• Undertake drilling focused on parts of the resource with best potential to drive the economics for
near-term project development.
SYMONS HILL (Nickel Fraser Range)
Matsa’s Symons Hill project (E69/3070) is located 6kms immediately to the south of the Nova mine
owned by Independence Group Limited (IGO) and is within the Fraser Range Tectonic Zone.
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2020 ANNUAL REPORT · PAGE 29
Regional aeromagnetic and gravity information on the Symons Hill project indicates similarities in
geological setting to the Nova mine.
In June 2020, Matsa executed a $7M agreement with IGO Newsearch Pty Ltd (IGO), who can earn a
70% interest in the Symons Hill nickel project in the Fraser Range (MAT announcement to ASX 17th
June 2020). Matsa has received a first payment of $625,000 from IGO.
The following activities were carried out by IGO on behalf of the joint venture during the year:
• Ground checking to inspect condition of existing cut lines for upcoming ground EM surveys and
aircore drilling.
• Consultations with Ngadju Native Title Aboriginal Corporation (NNTAC) concerning planned
ground geophysics and aircore drilling.
Exploration is expected to commence towards the end of 2020 with access preparation during the
September 2020 quarter.
THAILAND EXPLORATION
As a result of the COVID-19 and the uncertain political and permitting environment in Thailand,
exploration activities were suspended and will resume when more certainty evolves in the country.
The office and staff were retained and were successfully utilised in assisting the Australian geologists
with data entry and data management of the Australian projects. Substantial savings and efficiencies
have been realised utilising the expertise of available staff in Thailand. This was a welcomed occurrence
and further growth in the utilisation of the Thailand office is expected.
CORPORATE ACTIVITIES
In late July 2019, the Company sold an 80% interest in the Lake Rebecca gold project in the eastern
goldfields, 150km ENE of Kalgoorlie, Western Australia to Bulletin Resources Limited for consideration of
$125,000 with a following 1% NSR royalty. This allowed the Company to focus on the Lake Carey gold
project whilst retaining a non-contributing 20% interest in a highly prospective gold exploration project.
In September 2019, the Company completed a $6 million placement via the issue of 40 million
shares at $0.15 per share (incl. a free 1 for 4 unlisted option exercisable at 25c within 18 months).
The capital raising was heavily oversubscribed and highly successful and has brought a number of new
institutional and sophisticated investors to Matsa’s share register.
The funds from the capital raising were used to conduct:
1. An extensive and immediate new underground exploration diamond drill program within the Red
October underground gold mine.
2. New drilling programs at Fortitude North, Red October near mine surface and Devon gold mine
and surrounds.
3.
Increased regional exploration where numerous targets are being developed.
4. Commence works on Fortitude Stage 2 gold mine.
On 2 March 2020, Matsa announced it had conducted a capital raising via the issue of 10 million
shares at an issue price of $0.155 each to a single institutional investor. The funds raised were used
for increasing efficiencies in mining operations at the Red October underground mine and further
exploration at Red October.
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2020 ANNUAL REPORT · PAGE 30
Exploration results
The information in this report that relates to Exploration results is based on information compiled by
David Fielding, who is a Fellow of the Australasian Institute of Mining and Metallurgy. David Fielding
is a full-time employee of Matsa Resources Limited. David Fielding has sufficient experience which is
relevant to the style of mineralisation and the type of ore deposit under consideration and 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’. David
Fielding consents to the inclusion in the report of the matters based on his information in the form
and context in which it appears.
MATSA RESOURCES LIMITED
DIRECTORS’ REPORT
Your directors present their report for the year ended 30 June 2020.
DIRECTORS
The names and details of the Company’s directors in office during the year and until the date of this
report are as follows. Directors were in office for this entire period unless otherwise stated.
Names, qualifications, experience and special responsibilities
Mr Paul Poli Bachelor of Commerce, FCPA (Executive Chairman)
Mr Poli is a fellow of the Australian Society of Certified Practicing Accountants and was the founder
and managing partner of an accounting firm for 19 years from 1989 to 2008. He is well versed in all
aspects of accounting and taxation and has considerable experience in business through his role as a
consultant to many varied clients and through his own involvement in ownership of businesses in
Western Australia, the Northern Territory and South East Asia.
He has been chairman of Matsa Resources Limited for over 10 years and as a former registered
Securities Trader and a significant investor in the mining industry, Mr Poli is particularly well qualified
to drive the creation of a significant new mining and exploration company.
During the past three years, Mr Poli has also served as a Director of the following publicly listed
companies:
Bulletin Resources Limited (Appointed 24 June 2014)
Mr Franciscus (Frank) Sibbel B.E.(Hons) Mining, F.Aus.IMM
Mr Sibbel is a Mining Engineer who has over 40 years of extensive operational and management
experience in overseeing large and small scale mining projects from development through to
successful production. He was formerly the Operations Director of Tanami Gold NL until 30 June 2008,
and worked as the Principal in his own established mining consultancy firm where he has undertaken
numerous projects for both large and small mining companies. Mr Sibbel is currently a director and
former Chairman of Bulletin Resources Limited.
During the past three years, Mr Sibbel has also served as a Director of the following publicly listed
companies:
Bulletin Resources Limited (Appointed 13 August 2013)
Mr Andrew Chapman CA F Fin
Mr Chapman is a chartered accountant with over 20 years’ experience with publicly listed companies
where he has held positions as Company Secretary and Chief Financial Officer and has experience in
the areas of corporate acquisitions, divestments and capital raisings. Since 1993 he has worked for a
number of public companies in the mineral resources, oil and gas and technology sectors.
Mr Chapman is an associate member of the Chartered Accountants Australia and New Zealand
(CAANZ) and a Fellow of the Financial Services Institute of Australasia (Finsia).
During the past three years, Mr Chapman has also served as a Director of the following publicly listed
companies:
Carnavale Resources Limited (Appointed 31 March 2015; resigned 28 April 2017)
- 31 -
MATSA RESOURCES LIMITED
DIRECTORS’ REPORT
COMPANY SECRETARY
Mr Chapman is also the Company Secretary and Chief Financial Officer of Matsa. Refer to the directors’
particulars as noted above.
PRINCIPAL ACTIVITIES
During the year the principal activities of entities within the consolidated entity were gold and other
base metal exploration in Australia and Thailand.
There were no significant changes in the nature of these activities during the year.
Operating Results for the Year
The Group’s net loss for the year after income tax is $5,235,103 (2019: $4,947,360).
The Group’s net loss for the year includes the following items:
• Revenue from the sale of gold ore tonnes of $10,680,968 (2019: $11,563,369).
• A loss of $517,538 (2019: loss of $194,649) on the sale of shares held in listed investments.
• A provision for diminution in investments of $Nil (2019; $1,248,296).
•
Impairment losses of $740,954 (2019: $156,500) attributable to the Group's exploration
projects.
• Care and maintenance costs on the Red October gold project of $Nil (2019: $1,232,675).
• The write-off of exploration expenditure of $248 (2019: $834,982).
• Share based payments expense of $297,042 (2019: $882,611).
•
Income of $237,630 (2019: $100,570) relating to a tax refund for eligible research and
development expenditure and a cash flow boost from the Australian government.
• Share of loss from the investment in associate Bulletin Resources Limited of $199,882 (2019:
$487,915).
Review of Financial Position
The net assets attributable to the shareholders of the parent have increased by $2,162,673 from 30
June 2019 to $15,330,507 at 30 June 2020.
During the financial year:
1. $6,000,000 (before costs) was raised via the issue of 40,000,000 fully paid ordinary shares at
an issue price of $0.15 each with one free unlisted option for every four shares subscribed for
with an exercise price of $0.25 each and expiring 31 May 2021; and
2. $1,550,000 (before costs) was raised via the issue of 10,000,000 fully paid ordinary shares at
an issue price of $0.155 each.
Cash reserves at 30 June 2020 were $1.80 million compared to $0.9 million in the previous financial
year and the Group had investments in listed shares, inclusive of Bulletin Resources Limited, of
$4,047,600.
DIVIDENDS
No dividend was paid or declared by Matsa in the period since the end of the previous financial year,
and up to the date of this report. The Directors do not recommend that any amount be paid by way
of dividend.
- 32 -
MATSA RESOURCES LIMITED
DIRECTORS’ REPORT
CORPORATE STRUCTURE
Matsa is a company limited by shares, which is incorporated and domiciled in Australia.
EMPLOYEES
The Group had 37 employees of which 27 were full-time as at 30 June 2020 (2019: 23 full-time
equivalent employees).
Review of Operations
A full review of the operations of the Group during the year ended 30 June 2020 is included on pages
4 to 30.
IMPACT OF COVID-19
While the onset of the COVID-19 pandemic was rapid and dramatic, the Company took immediate
action to protect the integrity of the Company’s business interests and the safety and wellbeing of its
employees and stakeholders. Prompt implementation and affirmative compliance with government
and health bodies forced quick change to operating processes.
Matsa operates a remote mining operation and fortunately with the positive protection measures and
support of governments and employees our operation continued to function close to normal levels
though travel restrictions, social distancing and isolation practices had some impacts on the Group.
The closure of borders required immediate action to manage these impacts on our labour force.
Roster changes, changed travel and commuting schedules, changed camp operations including dining
and enhanced hygiene practices created potential social and mental health impacts. The Company
has taken a considerate approach to the hidden consequences of such changes and continues to work
with its employees to lessen the impact. The over-arching objective of the Group has been to keep all
its employees and stakeholders safe and free from infection and/or spread, and importantly to keep
people employed during these uncertain times.
Given the exploration nature of the Company’s operations the net impact of the pandemic was
estimated to be minor on the Group’s operations. The over-arching objective of the Group is to keep
its employees and stakeholders safe and free from infection and/or spread.
SIGNIFICANT CHANGES IN STATE OF AFFAIRS
In the opinion of the Directors, there were no significant changes in the state of affairs of the Group
that occurred during the financial year other than as disclosed in this report or the consolidated
financial statements.
SIGNIFICANT EVENTS AFTER THE BALANCE DATE
On 3 September 2020, Matsa announced that that it had raised $6.6 million by way of a placement of
44 million ordinary fully paid shares at $0.15 each with one free attaching option for every share issued
with an exercise price of $0.30 each and expiring two years from the time of issue.
LIKELY DEVELOPMENTS AND EXPECTED RESULTS
It is expected that the Group will continue its exploration, development and mining activities in
Australia and Thailand. These are described in more detail in the Review of Operations on page 4.
- 33 -
MATSA RESOURCES LIMITED
DIRECTORS’ REPORT
ENVIRONMENTAL REGULATIONS AND PERFORMANCE
The Group’s exploration activities are subject to various environmental laws and regulations under
Australian and Thai Legislation. The Group has adequate systems in place for the management of its
environmental obligations. The directors are not aware of any breaches of the legislation during the
financial year which are material in nature.
DIRECTORS’ MEETINGS
The number of meetings of directors held during the year and the number of meetings attended by
each director were as follows:
Paul Poli
Frank Sibbel
Andrew Chapman
Directors’ Meetings
Number eligible
to attend
9
9
9
Number
attended
9
9
9
DIRECTORS’ INTERESTS IN THE SHARES AND OPTIONS OF THE COMPANY
As at the date of this report, the interests of the directors in the shares and options of Matsa Resources
Limited were:
Number of Ordinary
Shares
Number of $0.175
Options
Number of $0.17
Options
Paul Poli
Frank Sibbel
Andrew Chapman
11,955,000
594,852
69,000
2,750,000
1,500,000
1,500,000
2,500,000
1,250,000
1,250,000
Options granted to directors and officers of the Company
During the financial year, the Company granted 5,750,000 options over unissued ordinary shares for
no consideration in the Company to directors or officers of the Company as part of their remuneration.
SHARE OPTIONS
As at the date of this report the unissued ordinary shares of Matsa Resources Limited under option
are as follows:
Date of Expiry
Exercise Price
Number under Option
31 May 2021
30 November 2021
30 November 2022
30 November 2022
$0.25
$0.17
$0.175
$0.35
11,000,000
7,850,000
5,750,000
1,000,000
25,600,000
Option holders do not have any right, by virtue of the option, to participate in any share issue of the
Company or any related body corporate.
Shares Issued on Exercise of Options
There were no options exercised during the financial year.
- 34 -
MATSA RESOURCES LIMITED
DIRECTORS’ REPORT
REMUNERATION REPORT - Audited
Principles of Compensation
This remuneration report for the year ended 30 June 2020 outlines the remuneration arrangements
of the Company and the Group in accordance with the requirements of the Corporations Act 2001
(“the Act”) and its regulations. This information has been audited as required by Section 308(3C) of
the Act.
The remuneration report details the remuneration arrangements for Key Management Personnel
(“KMP”) who are defined as those persons having authority and responsibility for planning, directing
and controlling the major activities of the Group, directly or indirectly, including any director (whether
executive or otherwise) of the parent company, and includes the four executives in the parent and
the Group receiving the highest remuneration.
For the purposes of this remuneration report, the term ‘executive’ includes the Executive Directors,
Senior Executives and Secretary of the Parent and the Group.
The remuneration report is presented under the following sections:
1. Individual key management personnel disclosures
2. Board oversight of remuneration
3. Non-executive Director remuneration arrangements
4. Executive remuneration arrangements
5. Company performance and the link to remuneration
6. Executive contractual arrangements
7. Equity instruments disclosures
Individual Key Management Personnel Disclosures
Details of KMP of the Parent and Group are set out below:
Key Management Personnel
Name
Directors
P Poli
F Sibbel
A Chapman
Executives
D Fielding
Position
Date of
Appointment
Date of
Resignation
Executive Chairman
Director
23 December 2008
25 October 2010
Director and Company Secretary 17 December 2009*
Group Exploration Manager
12 April 2010
-
-
-
-
*A Chapman was appointed Company Secretary on 6 November 2007.
There were no other changes to key management personnel after reporting date and before the date
the financial report was authorised for issue.
- 35 -
MATSA RESOURCES LIMITED
DIRECTORS’ REPORT
REMUNERATION REPORT (continued)
Board Oversight of Remuneration
Remuneration Committee
In the opinion of the directors, the Company is not of sufficient size to warrant the formation of a
remuneration committee. It is the board of directors’ responsibility for determining and reviewing
compensation arrangements for the directors and the senior executives.
The Board assesses the appropriateness of the nature and amount of remuneration of Non-Executive
Directors and Executives on a periodic basis by reference to relevant employment market conditions
with the overall objective of ensuring maximum stakeholder benefit from the retention of a high
performing Director and executive team.
Remuneration Approval Process
The Board approves the remuneration arrangements of the Executive Directors and Executives and all
awards made under the long-term incentive plan. The Board also sets the aggregate remuneration of
non-executive directors which is then subject to shareholder approval.
Remuneration Strategy
The Company’s remuneration strategy is designed to attract, motivate and retain employees and non-
executive directors by identifying and rewarding high performers and recognising the contribution of
each employee to the continued growth and success of the Group.
To this end, the Company embodies the following principles in its remuneration framework:
• retention and motivation of key executives;
• attraction of quality management to the Company; and
• performance incentives which allow executives to share the rewards of the success of the
Company.
Remuneration Structure
In accordance with best practice corporate governance, the structure of Non-Executive Director and
Senior Management remuneration is separate and distinct.
Non-Executive Director Remuneration
Objective
The Board seeks to set aggregate remuneration at a level which provides the Company with the ability
to attract and retain Directors of the highest calibre, whilst incurring a cost which is acceptable to
shareholders.
Remuneration Policy
The Constitution and the ASX Listing Rules specify that the aggregate remuneration of Non-Executive
Directors shall be determined from time to time by a general meeting. An amount not exceeding the
amount determined is then divided between the Directors as agreed. The current aggregate
remuneration is $250,000 per year.
- 36 -
MATSA RESOURCES LIMITED
DIRECTORS’ REPORT
REMUNERATION REPORT (continued)
The amount of aggregate remuneration sought to be approved by shareholders and the manner in
which it is apportioned amongst Directors is reviewed annually. The Board considers advice from
external consultants as well as the fees paid to non-executive Directors of comparable companies
when undertaking the annual review process. No external advice was received during the year. Each
Director receives a fee for being a Director of the Company.
Non-Executive Directors are encouraged by the Board to hold shares in the Company (purchased by
the Director on market). It is considered good governance for Directors to have a stake in the
Company on whose Board he or she sits.
Structure
The remuneration of Non-Executive Directors consists of directors’ fees. Non-Executives are entitled
to receive retirement benefits and to participate in any incentive programs. There are currently no
specific incentive programs.
The Executive Chairman receives no additional directors’ fee in addition to his executive
remuneration. The other non-executive directors received a base fee of $42,000 per annum during
the financial year for being a director of the Group.
There are no additional fees for serving on any board committees. Non-executive directors can receive
additional fees for work conducted for the Company outside the scope of their normal duties subject
to being authorised by the Board.
The remuneration report for the Non-Executive Directors for the year ended 30 June 2020 and 30 June
2019 is detailed in this report.
Managing Director and Executive Remuneration Structure
Remuneration Policy
The Company aims to reward executives with a level and mix of remuneration commensurate with
their position and responsibilities within the Company. The current remuneration policy adopted is
that no element of any executive package be directly related to the Company’s financial performance.
Indeed there are no elements of any executive remuneration that are dependent upon the satisfaction
of any specific condition. Remuneration is not linked to the performance of the Company but rather
to the ability to attract and retain executives of the highest calibre. The overall remuneration policy
framework however is structured in an endeavour to advance/create shareholder wealth.
Structure
In determining the level and make-up of executive remuneration, the Board engages external
consultants as needed to provide independent advice.
Remuneration consists of the following key elements:
•
Fixed remuneration (base salary and superannuation); and
• Variable remuneration (short and long term incentives).
The proportion of fixed remuneration and variable remuneration for each executive for the period
ended 30 June 2020 and 30 June 2019 is detailed in this report.
- 37 -
MATSA RESOURCES LIMITED
DIRECTORS’ REPORT
REMUNERATION REPORT (continued)
Fixed Remuneration
Executive contracts of employment do not include any guaranteed base pay increase. Fixed
remuneration is reviewed annually by the Board. The process consists of a review of the Company,
business unit and individual performance, relevant comparative remuneration internally and
externally and, where appropriate, external advice independent of management.
Executives are given the opportunity to receive their fixed (primary) remuneration in a variety of forms
including cash and fringe benefits such as motor vehicles. It is intended that the manner of payment
chosen will be optimal for the recipient without creating undue cost for the Company.
The fixed remuneration component for executives for the period ended 30 June 2020 and 30 June
2019 is detailed in this report.
Variable Remuneration – Short Term Incentive (STI)
The objective of the STI is to link the increase in shareholder value over the year with the remuneration
received by the Executives charged with achieving that increase. The total potential STI available is set
at a level so as to provide sufficient incentive to the Executives to achieve the performance goals and
such that the cost to the Group is reasonable in the circumstances.
Annual STI payments granted to each Executive depend on their performance over the preceding year
and are based on recommendations from the Executive Chairman following collaboration with the
Board. Typically included are measures such as contribution to strategic initiatives, risk management
and leadership/team contribution.
The aggregate of annual STI payments available for Executives across the Group is subject to the
approval of the Board. Payments are usually delivered as a cash bonus. During the year there were
no STI payments.
Variable Remuneration – Long Term Incentive (LTI)
The objective of the LTI plan is to reward Executives in a manner which aligns the element of
remuneration with the creation of shareholder wealth. As such LTI’s are made to Executives who are
able to influence the generation of shareholder wealth and thus have an impact on the Group’s
performance.
The level of LTI granted is, in turn, dependent on the Company’s recent share price performance, the
seniority of the Executive and the responsibilities the Executive assumes in the Group.
LTI grants to Executives are delivered in the form of employee share options. These options are issued
at an exercise price determined by the Board at the time of issue. The employee share options are
issued in accordance with the Company’s Share Option Plan.
Typically, the grant of LTI’s occurs at the commencement of employment or in the event that the
individual receives a promotion and, as such, is not subsequently affected by the individual’s
performance over time. However, under certain circumstances, including breach of employment
conditions, the Directors may cause the options to expire prior to their vesting date.
The Group does have a policy to prohibit executives or directors from entering into arrangements to
protect the value of unvested LTI awards.
- 38 -
MATSA RESOURCES LIMITED
DIRECTORS’ REPORT
REMUNERATION REPORT (continued)
Other Benefits
Key management personnel can receive additional benefits as non-cash benefits as part of the terms
and conditions of their appointment. Non-cash benefits typically include car parking and expenses
where the Company pays fringe benefits tax on these benefits.
Company Performance and the Link to Remuneration
Remuneration is not linked to the performance of the Company, but based on the ability to attract
and retain executives of the highest calibre. The overall remuneration policy framework however is
structured in an endeavour to advance/create shareholder wealth.
The Matsa Resources Limited Long Term Incentive Plan has no direct performance requirements but
has specified time restrictions on the exercise of options and performance rights. The granting of
options and performance rights is in substance a performance incentive which allows executives to
share the rewards of the success of the Company.
Service Agreements
It is the Board’s policy that service contracts are entered into with all key management personnel and
that these contracts have no termination date.
Mr Paul Poli, Executive Chairman, has a contract of employment with the Company. Mr Poli is entitled
to receive a salary of $375,000 plus statutory superannuation. This contract is for an unlimited term
and is capable of termination by Mr Poli on one month’s notice. The Group has the right to terminate
the employment contract by giving Mr Poli six months’ notice or making payment equal to six months’
pay in lieu of notice.
Mr David Fielding, Group Exploration Manager, has a contract of employment with the Company. Mr
Fielding receives a salary of $221,000 plus statutory superannuation. This contract is for an unlimited
term and is capable of termination on one month’s notice. The Group retains the right to terminate
the contract immediately, by making payment equal to one month’s pay in lieu of notice.
Mr Frank Sibbel, Non-Executive Director, has a consultancy contract with the Company. Mr Sibbel is
paid an hourly rate for the provision of consultancy services outside those provided as a director as
required. This contract is capable of termination on one month’s notice. The Group retains the right
to terminate the contract immediately, by making payment equal to one month’s pay in lieu of notice.
Mr Andrew Chapman, Director and Company Secretary, has a contract of employment with the
Company receives a salary of $200,000 plus statutory superannuation. This contract is for an unlimited
term and is capable of termination on one month’s notice. The Group retains the right to terminate
the contract immediately, by making payment equal to one month’s pay in lieu of notice.
The table below shows the performance of the Group as measured by share price.
As at 30 June
Closing share price
Net comprehensive (loss) per
year ended
2020
$0.155
2019
$0.145
2018
$0.155
2017
$0.25
2016
$0.17
(5,235,103)
(4,947,360)
(3,886,427)
2,517,038
(2,231,886)
- 39 -
MATSA RESOURCES LIMITED
DIRECTORS’ REPORT
REMUNERATION REPORT (continued)
2020
Short Term Benefits
Post-
employment
Benefits
Share-
based
payments
Key Management
Person
Salary &
Fees
$
Other
$
Superannuation
$
Securities
$
Total
$
%
Performance
Related
% of
Remuneration
that consists
of securities
Directors
Paul Poli1
Frank Sibbel2
Andrew Chapman3
Total
1 Mr Poli is a director and shareholder of Strategic Siam Co Ltd which received payments totalling $45,035 during the year. Strategic Siam
494,611
157,247
286,382
938,240
142,064
77,489
77,489
297,042
331,045
79,758
190,770
601,573
21,002
-
18,123
39,125
28.72
49.28
27.06
-
28.72
49.28
27.06
-
500
-
-
500
provides administration services to Thai entities. Mr Poli receives an internet allowance as part of his terms of employment.
2 Mr Sibbel provided consultancy services to the Company totalling $37,758 during the year.
3 Mr Chapman provided company secretarial services to the Company totalling $190,770 during the year.
Executives
David Fielding
Total
221,000
221,000
-
-
20,995
20,995
-
-
241,995
241,995
-
-
-
-
2019
Short Term Benefits
Post-
employment
Benefits
Share-
based
payments
Key Management
Person
Salary &
Fees
$
Other
$
Superannuation
$
Securities
$
Total
$
%
Performance
Related
% of
Remuneration
that consists
of securities
Directors
Paul Poli1
Frank Sibbel2
Andrew Chapman3
Total
1 Mr Poli is a director and shareholder of Strategic Siam Co Ltd which received payments totalling $56,441 during the year. Strategic Siam
608,243
187,428
379,826
1,175,497
244,876
122,438
122,438
489,752
342,336
64,990
235,066
642,392
20,531
-
22,322
42,853
40.26
65.33
32.24
-
40.26
65.33
32.24
-
500
-
-
500
provides administration services to Thai entities. Mr Poli receives an internet allowance as part of his terms of employment.
2 Mr Sibbel provided consultancy services to the Company totalling $22,990 during the year.
3 Mr Chapman provided company secretarial services to the Company totalling $193,066 during the year.
Executives
David Fielding
Total
321,165
321,165
221,000
221,000
79,634
79,634
20,531
20,531
-
-
24.80
-
24.80
-
Compensation Options Granted and Vested during the year
The table below sets out options granted during the year to Directors and Executives. There were
5,750,000 options issued to Directors and Executives during the year. There were no options that were
granted in previous years that vested during the year. The options were issued free of charge and
entitle the holder to subscribe for one fully paid ordinary share in the Company. Due to the nature of
the Company’s activities it does not believe it is appropriate to set vesting conditions at this time.
- 40 -
MATSA RESOURCES LIMITED
DIRECTORS’ REPORT
REMUNERATION REPORT (Continued)
2020
Vested
Granted Grant Date
Value per
Security
at Grant
Date
Exercise
Price
First
Exercise
Date
Expiry
Date
No.
No.
Cents
Cents
2,750,000 2,750,000
P Poli
F Sibbel
1,500,000 1,500,000
A Chapman 1,500,000 1,500,000
-
D Fielding
-
28.11.19
28.11.19
28.11.19
-
5.17
5.17
5.17
-
17.5
17.5
17.5
-
28.11.19 30.11.22
28.11.19 30.11.22
28.11.19 30.11.22
-
-
For details on the valuation of the options, including models and assumptions used, please refer to
Note 28.
There were no alterations to the terms and conditions of options granted as remuneration since their
grant date.
The maximum value of the award is equal to the number of options granted multiplied by the fair
value at the grant date. The minimum value of the award in the event of forfeiture is zero.
There were no shares issued on exercise of compensation options during the year.
Value of Options granted as part of remuneration
2020
Paul Poli
Frank Sibbel
Andrew Chapman
David Fielding
Value of options
granted during the
year
Value of options
exercised during
the year
Value of options
lapsed during the
year
Remuneration
consisting of
options during the
year
$
$
$
%
142,064
77,489
77,489
-
-
-
-
-
-
-
-
-
28.72
49.28
27.06
-
Option holdings of key management personnel
2020
Balance 1
July
No.
Granted as
remune-
ration
No.
Exercised Net change
other*
Balance on
Resignation
Balance 30
June
Vested &
Exercisable
Not
Exercisable
No.
No.
No.
No.
No.
No.
P Poli
A Chapman
F Sibbel
D Fielding
5,250,000
2,750,000
2,750,000
1,250,000
12,000,000
2,750,000
1,500,000
1,500,000
-
5,750,000
-
-
-
-
-
(2,750,000)
(1,500,000)
(1,500,000)
(500,000)
(6,250,000)
5,250,000
2,750,000
2,750,000
750,000
5,250,000
-
2,750,000
-
2,750,000
-
-
750,000
- 11,500,000 11,500,000
-
-
-
-
-
- 41 -
MATSA RESOURCES LIMITED
DIRECTORS’ REPORT
REMUNERATION REPORT (Continued)
Option holdings of key management personnel (continued)
2019
Balance 1
July
No.
Granted as
remune-
ration
No.
Exercised
No.
Net
change
other*
No.
Balance on
Resignation
Balance 30
June
Vested &
Exercisable
Not
Exercisable
No.
No.
No.
No.
P Poli
A Chapman
F Sibbel
D Fielding
2,750,000
1,500,000
1,500,000
500,000
6,250,000
2,500,000
1,250,000
1,250,000
750,000
5,750,000
-
-
-
-
-
-
-
-
-
-
*Net change other refers to expiry of options during the year.
Shareholdings of key management personnel
5,250,000
2,750,000
2,750,000
1,250,000
5,250,000
-
2,750,000
-
2,750,000
-
-
1,250,000
- 12,000,000 12,000,000
-
-
-
-
-
2020
Balance 1 July
P Poli
A Chapman
F Sibbel
D Fielding
No.
11,855,000
69,000
494,852
755,929
13,174,781
2019
Balance 1 July
P Poli
A Chapman
F Sibbel
D Fielding
No.
11,825,000
44,000
294,852
715,929
12,879,781
Granted as
remuneration
No.
Options
exercised
No.
Net change
other**
No.
Balance on
resignation
No.
Balance
30 June
No.
-
-
-
-
-
Granted as
remuneration
No.
Options
exercised
No.
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
100,000
-
100,000
-
200,000
Net change
other**
No.
Balance on
resignation
No.
30,000
25,000
200,000
40,000
295,000
-
-
-
-
-
-
-
-
-
-
11,955,000
69,000
594,852
755,929
13,374,781
Balance
30 June
No.
11,855,000
69,000
494,852
755,929
13,174,781
**Net change other refers to on market purchases and sale and any other corporate action taken by the Company during
the year.
End of Audited Remuneration Report
- 42 -
MATSA RESOURCES LIMITED
DIRECTORS’ REPORT
INDEMNIFYING OFFICERS
The Company’s Constitution provides that, subject to and so far as permitted by the Corporations Act
2001, the Company must, to the extent the person is not otherwise indemnified, indemnify every
officer of the Company out of the assets of the Company to the relevant extent against any liability
incurred by the officer in or arising out of the conduct of the business of the Company or in or arising
out of the discharge of the duties of the officer.
Since the end of the previous financial year, the Company has paid insurance premiums in respect of
Directors’ and Officers’ liability. The policy indemnifies all Directors and Officers of the Company and
its controlled entities against certain liabilities. In accordance with common commercial practice, the
insurance policy prohibits disclosure of the nature of the liability insured against and the amount of
the premium. The Directors have not included details of the nature of the premium paid in respect of
Directors’ and Officers’ liability as such disclosure is prohibited under the terms of the contract.
PROCEEDINGS ON BEHALF OF COMPANY
No person has applied for leave of Court to bring proceedings on behalf of the company or intervene
in any proceedings to which the company is a party for the purpose of taking responsibility on behalf
of the company for all or any part of those proceedings.
The Company was not a party to any such proceedings during the year.
CORPORATE GOVERNANCE
In recognising the needs for the highest standards of corporate behaviour and accountability, the
Directors of the Company support and have adhered to the principles of Corporate Governance. The
Company’s corporate governance statement is available on the Company’s website at:
http://www.matsa.com.au/company/corporate-governance/
NON-AUDIT SERVICES
The board of directors is satisfied that the provision of non-audit services during the year is compatible
with the general standard of independence for auditors imposed by the Corporations Act 2001. The
directors are satisfied that the services disclosed below did not compromise the external auditor’s
independence as the nature of the services provided did not compromise the general principles
relating to auditor independence.
The following fees for non-audit services were paid/payable to the external auditors, or by related
practices of the external auditors, during the year ended 30 June 2020:
Taxation services
$6,000
AUDITOR’S INDEPENDENCE DECLARATION
The lead auditor’s independence declaration for the year ended 30 June 2020 has been received and
can be found on page 44.
Signed in accordance with a resolution of the Board of Directors.
Paul Poli
Executive Chairman
Dated this 30th day of September 2020
- 43 -
Lead Auditor’s independence declaration under section 307C of the Corporations
Act 2001
To the Directors of Matsa Resources Limited,
I declare that, to the best of my knowledge and belief, in relation to the audit for the financial
year ended 30 June 2020 there have been:
(i)
(ii)
no contraventions of the auditor’s independence requirements as set out in the
Corporations Act 2001 in relation to the audit; and
no contraventions of any applicable code of professional conduct in relation to the
audit.
Nexia Perth Audit Services Pty Ltd
PTC Klopper
Director
Perth
30 September 2020
- 44 -
MATSA RESOURCES LIMITED
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE
INCOME FOR THE YEAR ENDED 30 JUNE 2020
Note
5(c)
5(a)
5(c)
5(d)
12
5(b)
11
6
2020
$
10,680,968
(8,874,916)
(2,692,144)
(886,092)
619,220
(202,009)
(2,933,163)
(343,906)
(8,306)
(741,202)
(4,495,458)
18,888
(558,651)
(539,763)
(199,882)
(5,235,103)
-
2019
$
11,563,369
(8,192,646)
(695,718)
2,675,005
658,587
(318,615)
(5,874,769)
(194,649)
(59,314)
(932,168)
(4,045,923)
32,749
(446,271)
(413,522)
(487,915)
(4,947,360)
-
(5,235,103)
(4,947,360)
-
-
(5,235,103)
(4,947,360)
(5,235,383)
280
(5,235,103)
(5,235,383)
280
(5,235,103)
(2.49)
(2.49)
(4,947,518)
158
(4,947,360)
(4,947,518)
158
(4,947,360)
(2.80)
(2.80)
Revenue
Mining operations
Amortisation and depreciation
Other income
Depreciation expense
Other expenses
Loss on sale of investments
Loss on sale of tenements
Exploration and evaluation expenditure written
off/provided for
Results from operating activities
Finance income
Finance costs
Net finance income
Share of loss of equity-accounted investee, net of tax
Loss before income tax expense
Income tax expense
Net loss for the year attributable to equity holders of
the company
Other comprehensive income to be reclassified
subsequently through profit or loss
Other comprehensive income/(loss) for the year, net of
tax
Total comprehensive loss for the year attributable to
equity holders of the company
Loss for the year is attributable to:
Owners of the parent
Non-controlling interest
Total comprehensive loss for the year is attributable to:
Owners of the parent
Non-controlling interest
Basic loss per share attributable to ordinary equity
holders of the parent
Diluted loss per share attributable to ordinary equity
holders of the parent
22
22
The accompanying notes form part of these financial statements.
- 45 -
MATSA RESOURCES LIMITED
CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2020
Note
2020
$
2019
$
Current assets
Cash and cash equivalents
Trade and other receivables
Other assets
Inventories
Total current assets
Non-current assets
Other assets
Financial assets
Investments in associates
Exploration and evaluation assets
Property, plant and equipment
Mine properties and development
Right-of-use assets
Total non-current assets
Total assets
Current liabilities
Trade and other payables
Lease liabilities
Provisions
Total current liabilities
Non-current liabilities
Borrowings
Lease liabilities
Provisions
Total non-current liabilities
Total liabilities
Net assets
Equity
Issued capital
Reserves
Accumulated losses
Total equity attributable to equity
holders of the Company
Non-controlling interests
Total equity
25
7
8
9
8
10
11
12
14
13
15
16
15
18
17
15
18
19
20
21
1,797,098
1,532,009
82,084
573,871
3,985,062
324,895
351,600
155,735
18,537,147
1,901,017
1,669,003
186,813
23,126,210
27,111,272
4,621,880
92,009
304,552
5,018,441
3,973,264
60,514
2,650,819
6,684,597
11,703,038
15,408,234
901,148
317,288
67,825
106,923
1,393,184
327,662
1,110,206
355,617
16,355,239
1,785,389
649,941
-
20,584,054
21,977,238
1,715,618
102,273
258,002
2,075,893
3,960,846
98,106
2,597,112
6,656,064
8,731,957
13,245,281
51,348,741
9,752,588
(45,770,822)
15,330,507
77,727
15,408,234
44,292,467
9,396,962
(40,521,595)
13,167,834
77,447
13,245,281
The accompanying notes form part of these financial statements.
- 46 -
MATSA RESOURCES LIMITED
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 30 JUNE 2020
Balance at 1 July
2018
Adjustments on the
initial application of
AASB 9
Comprehensive
gain/(loss) for the
year
Total comprehensive
gain/(loss) for the
year
Transactions with
owners recorded
directly in equity
Share based
payment
Balance at 30 June
2019
Balance at 1 July
2019
Comprehensive
gain/(loss) for the
year
Total comprehensive
gain/(loss) for the
year
Transactions with
owners recorded
directly in equity
Issue of share capital
Share issue costs
Reserve transferred
to accumulated
losses
Share based
payment
Balance at 30 June
2020
Issued
Capital
Ordinary
$
Accumulated
Losses
$
Other
Reserves
$
Equity
Settled
Benefits
Reserve
$
Total
$
Non-
controlling
interest
$
Total
$
44,292,467
(37,515,368)
1,927,447
8,528,195 17,232,741
77,289 17,310,030
-
-
1,941,291
(1,941,291)
-
-
-
-
(4,947,518)
-
-
(4,947,518)
158
(4,947,360)
-
(3,006,227)
(1,941,291)
-
(4,947,518)
158
(4,947,360)
-
-
-
882,611
882,611
-
882,611
44,292,467
(40,521,595)
(13,844) 9,410,806 13,167,834
77,447 13,245,281
44,292,467
(40,521,595)
(13,844) 9,410,806 13,167,834
77,447 13,245,281
-
-
(5,235,383)
(5,235,383)
7,569,050
(512,776)
-
-
-
-
-
-
-
(5,235,383)
280
(5,235,103)
-
(5,235,383)
280
(5,235,103)
- 7,569,050
(512,776)
-
-
-
-
-
7,569,050
(512,776)
-
341,782
51,348,741
(45,770,822)
9,752,588 15,330,507
77,727 15,408,234
-
-
(13,844)
13,844
-
-
-
341,782
341,782
-
-
The accompanying notes form part of these financial statements.
- 47 -
MATSA RESOURCES LIMITED
CONSOLIDATED CASH FLOW STATEMENT FOR THE YEAR ENDED 30 JUNE 2020
Note
2020
$
2019
$
Receipts from customers
Other income
Payments to suppliers and employees
Interest received
Interest paid
Net cash provided by/(used in) operating activities
25
Cash flows from investing activities
Payments for financial assets
Proceeds from sale of financial assets
Purchase of plant and equipment
Exploration and evaluation expenditure
(capitalised)
Payments for acquisition of mining tenements
Proceeds on sale of plant and equipment
Proceeds on sale of tenements
Payments for mine properties
Refund of security deposits
Net cash used in investing activities
Cash flows from financing activities
Proceeds from issue of shares
Costs of issue
Repayment of lease liabilities
Proceeds from borrowings
Interest paid
Net cash provided by financing activities
25
25
9,270,824
507,460
(8,321,338)
18,888
(53,815)
1,422,019
(185,400)
600,100
(860,990)
(3,967,159)
(177,166)
5,859
750,000
(3,235,276)
105,930
(6,964,102)
7,569,050
(468,036)
(170,563)
-
(492,418)
6,438,033
12,221,038
442,679
(11,388,710)
37,560
-
1,312,567
(225,000)
838,968
(1,382,217)
(3,514,253)
-
80,000
150,000
(739,690)
149,630
(4,642,562)
-
-
(110,817)
1,000,000
(449,724)
439,459
Net increase/(decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of financial
year
Cash and cash equivalents at end of financial year
25
895,950
(2,890,536)
901,148
1,797,098
3,791,684
901,148
The accompanying notes form part of these financial statements.
- 48 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
1.
CORPORATE INFORMATION
The consolidated financial statements of Matsa Resources Limited for the year ended 30 June 2020
were authorised for issue in accordance with a resolution of the Board of Directors on 30 September
2020.
Matsa Resources Limited (the “Company”) is a for profit company limited by shares incorporated and
domiciled in Australia whose shares are publicly traded on the Australian Securities Exchange.
The nature of the operations and principal activities of the Group are described in the Directors’
Report.
The consolidated financial statements of the Company as at and for the year ended 30 June 2020
comprise the Company, its subsidiaries (together referred to as the “Group” or “Consolidated Entity”)
and the Group’s interest in associates.
2.
SIGNIFICANT ACCOUNTING POLICIES
(a)
Basis of Preparation
The financial report is a general purpose financial report which has been prepared in accordance with
the requirements of the Corporations Act 2001, Australian Accounting Standards and other
authoritative pronouncements of the Australian Accounting Standards Board.
The consolidated financial statements have been prepared on the historical cost basis except for the
financial assets which have been measured at fair value.
The financial report is presented in Australian dollars.
(b)
Compliance with IFRS
The financial report complies with Australian Accounting Standards as issued by the Australian
Accounting Standards Board and also International Financial Reporting Standards (IFRS) as issued by
the International Accounting Standards Board.
(c)
Changes in Accounting Policies and Disclosures
Adoption of new accounting standards
In the current year, the Consolidated Entity has adopted all of the new and revised Standards and
Interpretations issued by the Australian Accounting Standards Board (the AASB) that are relevant to
its operations and effective for annual reporting periods beginning on 1 July 2019. Other than the
changes described below, the accounting policies adopted are consistent with those of the previous
financial year.
New and amended accounting standards adopted by the Group
AASB 16 supersedes AASB 117 Leases. The Group has adopted AASB 16 from 1 July 2019 which has
resulted in changes in the classification, measurement and recognition of leases. The changes relate
to where the Group is the lessee and impact the Statement of Financial Position by removing the
former distinction between “operating” and “finance” leases. The new standard requires the
recognition of a right-of-use asset (the leased item) and a financial liability (to pay rentals). The
exceptions are short-term leases and leases of low value assets.
- 49 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
2. SIGNIFICANT ACCOUNTING POLICIES (continued)
(c)
Changes in Accounting Policies and Disclosures (continued)
The Group has adopted AASB 16 using the modified retrospective approach under which the
reclassifications and the adjustments arising from the new leasing rules are recognised in the opening
Consolidated Statement of Financial Position on 1 July 2019. Under this approach, there is no initial
impact on retained earnings and comparatives have not been restated.
The Group has lease contracts for various items of mining equipment, motor vehicles and office
premises. It does not have any sub-leases. Before the adoption of AASB 16, the Group classified each
of its leases (as lessee) at the inception date as either a finance lease or an operating lease.
The Group leases office premises. Prior to 1 July 2019, the lease was classed as an operating lease.
Payments made under operating leases were charged to profit or loss on a straight-line basis over the
period of the lease.
From 1 July 2019, where the Company is a lessee, the Group recognises a right-of-use asset and a
corresponding liability at the date which the lease asset is available for use by the Group (ie.
Commencement date). Each lease payment is allocated between the liability and finance cost. The
finance cost is charged to profit or loss over the lease period so as to produce a consistent period rate
of interest on the remaining balance of the liability for each period.
The lease liability is initially measured at the present value of the lease payments that are not paid at
the commencement date discounted using the rate implied in the lease. If this rate is not readily
determinable, the Group uses its incremental borrowing rate.
Lease payments included in the initial measurement if the lease liability consist of:
•
•
Fixed lease payments less any lease incentives available;
Variable lease payments that depend on any index or rate, initially measured using the index or
rate at commencement date;
Any amounts expected to be payable by the Group under residual value guarantees;
The exercise price of purchase options, if the group is reasonably certain to exercise the options;
and
Termination penalties of the lease term reflects the exercise of an option to terminate the lease.
•
•
•
Extension options are included in the property lease in the Group. In determining the lease term
management considers all facts and circumstances that create an economic incentive to exercise an
extension option. Extension options are only included in the lease term if, at commencement date, it
is reasonably certain that the options will be exercised.
Subsequent to initial recognition, the lease liability is measured by increasing the carrying amount to
reflect interest on the lease liability (using the effective interest method) and by reducing the carrying
amount to reflect the lease payments made. The lease liability is remeasured (with a corresponding
adjustment to right-of-use asset) whenever there is a change in the lease term (including assessments
relating to extension and termination options) lease payments due to changes in an index or rate, or
expected payments under guaranteed residual values.
- 50 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
2.
(c)
SIGNIFICANT ACCOUNTING POLICIES (continued)
Changes in Accounting Policies and Disclosures (continued)
Right-of-use assets comprise the initial measurement of the corresponding lease liability, lease
payments made at of before commencement date, less any lease incentives received and any initial
direct costs. These right-of-use assets are subsequently measured at cost less accumulated
depreciation and impairment losses. Where the terms of a lease require the Group to restore the
underlying asset, or the Group has an obligation to dismantle and remove a leased asset, a provision
is recognised and measured in accordance with AASB 137. To the extent that the costs relate to a
right-of-use asset, the costs are included in the related right-of-use asset.
Right-of-use assets are depreciated on a straight-line basis over the term of the lease (or the useful
life of the leased asset if this is shorter). Depreciation starts on commencement date of the lease.
Where leases have a term of less than 12 months or relate to low value assets, the Group has applied
the optional exemptions to not capitalise these leases and instead account for the lease expense on a
straight-line basis over the lease term.
Impact on adoption of AASB 16
On adoption of AASB 16, the Group recognised lease liabilities in relation to leases which had
previously been classified as operating leases under the principles of AASB 117. These liabilities were
measured at the present value of the remaining lease payments, discounted using the lessee’s
incremental borrowing rate as of 1 July 2019. The incremental borrowing rate applied to lease
liabilities on 1 July 2019 was 8%.
On initial application right-of-use assets were measured at the amount equal to the lease liability,
adjusted by the amount of any prepaid or accrued lease payments relating to that lease recognised in
the Statement of Financial Position as at 1 July 2019.
In the Condensed Statement of Cash Flows, the Group has recognised cash payments for the principal
portion of the lease liability within financing activities and cash payments for the interest portion of
the lease liability as interest paid within operating activities.
The adoption of AASB 16 resulted in the recognition of right-of-use assets of $122,707 and lease
liabilities of $122,707 in respect of all operating leases.
The net impact on accumulated losses at 1 July 2019 was nil.
Reconciliation of operating lease commitments previously disclosed as lease liabilities on 1 July
2019
Below is a reconciliation of total operating lease commitments as at 30 June 2019 as disclosed in the
annual financial statements for the year ended 30 June 2019, and the lease liabilities on 1 July 2019.
Reconciliation
Operating lease commitments disclosed as at 30 June 2019
Add - Adjustment as a result of change in the index rate
Discounted using the lessee’s incremental borrowing rate at the date
of initial application
Lease liabilities as at 1 July 2019
- 51 -
2019
$
116,873
13,945
8%
122,707
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
2.
(c)
SIGNIFICANT ACCOUNTING POLICIES (continued)
Changes in Accounting Policies and Disclosures (continued)
Impact on finance leases
Based on an analysis of the Group’s finance leases as at 30 June 2019 on the basis of the facts and
circumstances that exist at that date, the directors have assessed that the impact of this change will
not have an impact on the amounts recognised in the Group’s financial statements apart from the
reclassification of right-of-use assets from property, plant and equipment to right-of-use assets.
AASB Interpretation 23 Uncertainty over Income Tax Treatment
The Interpretation addresses the accounting for income taxes when tax treatments involve
uncertainty that affects the application of AASB 112 Income Taxes. It does not apply to taxes or levies
outside the scope of AASB 112, nor does it specifically include requirements relating to interest and
penalties associated with uncertain tax treatments. The Interpretation specifically addresses the
following:
• whether an entity considers uncertain tax treatments separately;
• the assumptions an entity makes about the examination of tax treatments by taxation authorities;
• how an entity determines taxable profit (tax loss), tax bases, unused tax losses, unused tax credits
and tax rates; and
• how an entity considers changes in facts and circumstances.
An entity has to determine whether to consider each uncertain tax treatment separately or together
with one or more other uncertain tax treatments. The approach that better predicts the resolution of
the uncertainty needs to be followed.
The interpretation did not have an impact on the consolidated financial statements of the Group.
Standards and Interpretations in issue not yet adopted for the year ended 30 June 2020
The directors have also reviewed all Standards and Interpretations in issue not yet adopted for the
year ended 30 June 2020. As a result of this review the Directors have determined that there is no
material impact of the Standards and Interpretations in issue not yet adopted on the Group and,
therefore, no change is necessary to Group accounting policies.
(d)
Basis of consolidation
The consolidated financial statements comprise the financial statements of the parent entity and its
subsidiaries (‘the Group’) as at 30 June each year.
Control is achieved where the company has exposure to variable returns from the entity and the
power to affect those returns. The existence and effect of potential voting rights that are currently
exercisable or convertible are considered when assessing whether a consolidated entity controls
another entity.
The financial statements of the subsidiaries are prepared for the same reporting period as the parent
company, using consistent accounting policies. In preparing consolidated financial statements, all
intercompany balances and transactions, income and expenses and profit and losses resulting from
intra-group transactions, have been eliminated in full.
Subsidiaries are fully consolidated from the date on which control is obtained by the Consolidated
Entity and cease to be consolidated from the date on which control is transferred out of the
Consolidated Entity.
- 52 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
2.
SIGNIFICANT ACCOUNTING POLICIES (Continued)
(d)
Basis of consolidation (continued)
Where there is loss of control of a controlled entity, the consolidated financial statements include the
results for the part of the reporting period during which the Company has control.
Changes in ownership interest of a subsidiary (without a change in control) are accounted for as a
transaction with owners in their capacity as owners.
Segment Reporting
(e)
Determination and presentation of operating segments
An operating segment is a component of the Group that engages in business activities from which it
may earn revenues and incur expenses, including revenues and expenses that relate to transactions
with any of the Group’s other components. All operating segments’ operating results are regularly
reviewed by the Group’s chief operating decision maker to make decisions about resources to be
allocated to the segment and assess its performance, and for which discrete financial information is
available.
Segment results that are reported to the chief operating decision maker include items directly
attributable to a segment as well as those that can be allocated on a reasonable basis. Unallocated
items comprise mainly corporate assets (primarily the Company’s headquarters), head office
expenses, and income tax assets and liabilities.
Segment capital expenditure is the total cost incurred during the period to acquire property, plant and
equipment, and intangible assets other than goodwill.
Business combinations
(f)
Business combinations are accounted for using the acquisition method. The cost of an acquisition is
measured as the aggregate of the consideration transferred, measured at acquisition date fair value
and the amount of any non-controlling interest in the acquiree. For each business combination, the
Group elects whether it measures the non-controlling interest in the acquiree either at fair value or
at the proportionate share of the acquiree’s identifiable net assets. Acquisition costs incurred are
expensed and included in administrative expenses.
When the Group acquires a business, it assesses the financial assets and liabilities assumed for
appropriate classification and designation in accordance with the contractual terms, economic
circumstances and pertinent conditions as at the acquisition date. This includes the separation of
embedded derivatives in host contracts by the acquiree.
If the business combination is achieved in stages, the acquisition date fair value of the acquirer’s
previously held equity interest in the acquiree is remeasured to fair value at the acquisition date
through profit or loss.
Any contingent consideration to be transferred by the acquirer will be recognised at fair value at the
acquisition date. Subsequent changes to the fair value of the contingent consideration that is deemed
to be an asset or liability will be recognised in accordance with AASB 9 either in profit or loss or as a
change to other comprehensive income. If the contingent consideration is classified as equity, it will
not be remeasured. Subsequent settlement is accounted for within equity. In instances where the
contingent consideration does not fall within the scope of AASB 9, it is measured in accordance with
the appropriate IFRS.
- 53 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
2.
SIGNIFICANT ACCOUNTING POLICIES (Continued)
(g)
Foreign currency transactions and balances
(i) Functional and presentation currency
The functional currency of each entity within the Consolidated Entity is the currency of the primary
economic environment in which that entity operates. The consolidated financial statements are
presented in Australian Dollars which is the parent entity’s functional and presentation currency.
(ii) Transactions and balances
Transactions in foreign currencies are initially recorded in the functional currency at the exchange
rates ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign
currencies are retranslated at the rate of exchange ruling at the reporting date.
Non monetary items are measured in terms of historical cost in a foreign currency are translated using
the exchange rate as at the date of the initial transaction. All exchange differences in the consolidated
financial report are recorded in profit and loss.
(iii) Transactions of subsidiary Companies’ functional currency to presentation currency
The results of the subsidiaries are translated into Australian Dollars (presentation currency). Income
and expenses are translated at the exchange rates at the date of the transactions. Assets and liabilities
are translated at the closing exchange rate for each balance date. Share capital, reserves and
accumulated losses are converted at applicable historical rates.
Exchange variations resulting from the translation are recognised in the foreign currency translation
reserve in equity. On consolidation, exchange differences arising from the translation of the net
investment in subsidiaries are taken to the foreign currency translation reserve. If a subsidiary were
sold, the proportionate share of exchange differences would be transferred out of equity and
recognised in the statement of comprehensive income.
(h)
Financial instruments
Non derivative financial instruments
Non derivative financial instruments comprise investments in equity securities, other receivables, cash
and cash equivalents and trade and other payables.
Trade and other receivables are generally due for settlement within 30 days. They are presented as
current assets unless collection is not expected for more than 12 months after the reporting date.
Trade and other receivables are recognised at amortised cost using the effective interest rate method,
less any allowance for expected credit losses.
The Group assesses at each balance date whether there is objective evidence that a financial asset or
group of financial assets is impaired. For trade and other receivables, the Group applies the simplified
approach permitted by AASB 9 to determine any allowances for expected credit losses, which requires
expected lifetime losses to be recognised from initial recognition of the receivables. The expected
credit losses on these financial assets are estimated using a provision matrix based on the Group’s
historical credit loss experience. The amounts held in trade and other receivables do not contain
impaired assets and are not past due. Based on the credit history of these trade and other receivables,
it is expected that the amounts will be received when due.
The Group’s financial risk management objectives and policies are set out in Note 27.
- 54 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
2.
(h)
SIGNIFICANT ACCOUNTING POLICIES (Continued)
Financial instruments (continued)
Due to the short-term nature of these receivables their carrying value is assumed to approximate their
fair value.
Financial assets are recognised and derecognised on settlement date where the purchase or sale of
an investment is under a contract whose terms require delivery of the investment within the time-
frame established by the market concerned. They are initially measured at fair value, net of
transaction costs, except for those financial assets classified as fair value through profit or loss, which
are initially measured at fair value. Transaction costs of financial assets carried at fair value through
profit or loss are expensed in profit or loss.
The Group classifies its financial assets as either financial assets at fair value though profit or loss
(“FVPL”), fair value though other comprehensive income (“FVOCI”) or at amortised cost. The
classification depends on the entity’s business model for managing the financial assets and the
contractual terms of the cash flows.
For investments in equity instruments, the classification depends on whether the Group has made an
irrevocable election at the time of initial recognition to account for the equity investment at FVPL or
FVOCI.
Financial assets at FVPL
For assets measured at FVPL, gains and losses will be recorded in profit or loss. The Group’s derivative
financial instruments are recognised at FVPL. Assets in this category are subsequently measured at
fair value. The fair values of financial assets in this category are determined by reference to active
market transactions or using a valuation technique where no active market exists. Refer to Note 27
for additional details. The Group has elected to measure its listed equities at FVPL.
Financial assets at OCI
For assets measured at FVOCI, gains and losses will be recorded in other comprehensive income. There
is no subsequent reclassification of fair value gains and losses to profit or loss following the
derecognition of the investment. Dividends from such investments continue to be recognised in profit
or loss as other income when the Group’s right to receive payments is established. Impairment losses
(and reversal of impairment losses) on equity investments measured at FVOCI are not reported
separately from other changes in fair value.
Assets in this category are subsequently measured at fair value. The fair values of quoted investments
are based on current bid prices in an active market.
Other
Other non-derivative financial instruments are measured at amortised cost using the effective interest
method.
(i)
Investments in associates
The Consolidated Entity's investment in its associates is accounted for using the equity method of
accounting in the consolidated financial statements. The associates are entities over which the
Consolidated Entity has significant influence and that are neither subsidiaries nor joint ventures.
The Consolidated Entity generally deems it has significant influence if it has over 20% of the voting
rights.
- 55 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
2.
(i)
SIGNIFICANT ACCOUNTING POLICIES (Continued)
Investments in associates (continued)
Under the equity method, investments in the associates are carried in the consolidated statement of
financial position at cost plus post-acquisition changes in the Consolidated Entity's share of net assets
of the associates.
Goodwill relating to an associate is included in the carrying amount of the investment and is not
amortised. After application of the equity method, the Consolidated Entity determines whether it is
necessary to recognise any impairment loss with respect to the Consolidated Entity's net investment
in associates. Goodwill included in the carrying amount of the investment in associate is not tested
separately, rather the entire carrying amount of the investment is tested for impairment as a single
asset. If an impairment is recognised, the amount is not allocated to the goodwill of the associate. The
Consolidated Entity's share of its associates' post-acquisition profits or losses is recognised in the
profit and loss, and its share of post-acquisition movements in reserves is recognised in reserves. The
cumulative post-acquisition movements are adjusted against the carrying amount of the investment.
Dividends receivable from associates reduce the carrying amount of the investment.
When the Consolidated Entity's share of losses in an associate equals or exceeds its interest in the
associate, including any unsecured long-term receivables and loans, the Consolidated Entity does not
recognise further losses, unless it has incurred obligations or made payments on behalf of the
associate.
The financial statements of the associate are prepared for the same reporting period as the
Consolidated Entity. When necessary, adjustments are made to bring the accounting policies in line
with those of the Consolidated Entity.
(j)
Leases
At inception of a contract, the Group assesses whether a contract is, or contains, a lease. A contract
is considered to contain a lease if it allows the Group the right to control the use of an identified asset
over a period of time in return for consideration. Where a contract or arrangement contains a lease,
the Group recognises a right-of-use asset and a lease liability at the commencement date of the lease.
A right-of-use asset is initially measured at cost, which is the present value of future lease payments
adjusted for any lease payments made at or before the commencement date, plus any make-good
obligations and initial direct costs incurred. Lease assets are depreciated using the straight-line
method over the shorter of their useful life and the lease term. Periodic adjustments are made for any
re-measurements of the lease liabilities and for impairment losses.
Lease liabilities are initially measured at the present value of future minimum lease payments,
discounted using the Group’s incremental borrowing rate if the rate implicit in the lease cannot be
readily determined, and are subsequently measured at amortised cost using the effective interest
rate. Minimum lease payments include fixed payments, amounts expected to be paid under a residual
value guarantee, the exercise price of purchase options for which the Group is reasonably certain to
exercise and incorporate the Group’s expectations of lease extension options.
The lease liability is remeasured when there are changes in future lease payments arising from a
change in rates, index or lease terms from exercising an extension or termination option. A
corresponding adjustment is made to the carrying amount of the lease assets.
Short term leases (lease term of 12 months or less) and leases of low value assets ($5,000 or less) are
recognised as incurred as an expense in the consolidated income statement. Low value assets
comprise computers and items of IT equipment.
- 56 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
2.
SIGNIFICANT ACCOUNTING POLICIES (Continued)
Impairment of non-financial assets
(k)
The Group assesses, at each reporting date, whether there is any objective evidence that a financial
asset or a group of financial assets is impaired. A financial asset or a group of financial assets is deemed
to be impaired if, and only if, there is objective evidence of impairment as a result of one or more
events that has occurred after the initial recognition of the asset (an incurred ”loss event”) and that
loss event has an impact on the estimated future cash flows of the financial asset or the group of
financial assets that can be reliably estimated. Evidence of impairment may include indications that
the debtors or a group of debtors is experiencing significant financial difficulty, default or delinquency
in interest or principal payments, the probability that they will enter bankruptcy or other financial
reorganisation and when observable data indicate that there is a measurable decrease in the
estimated future cash flows, such as changes in arrears or economic conditions that correlate with
defaults.
Cash and cash equivalents
(l)
Cash and cash equivalents in the statement of financial position comprise cash at bank and in hand
and short-term deposits that are readily convertible to known amounts of cash and which are subject
to an insignificant risk of changes in value.
For the purposes of the statement of cash flows, cash and cash equivalents consist of cash and cash
equivalents as defined above, net of outstanding bank overdrafts. Bank overdrafts are included within
interest bearing loans and borrowings in the current liabilities on the statement of financial position.
(m) Trade and other receivables
Trade and other receivables, which generally have 30-60 day terms, are recognised initially at fair
value and subsequently measured at amortised cost using the effective interest rate method, less an
allowance for impairment.
Collectability of trade and other receivables is reviewed on an ongoing basis. Individual debts that are
known to be uncollectible are written off when identified. An impairment allowance is recognised
when there is objective evidence that the Consolidated Entity will not be able to collect the receivable.
Financial difficulties of the debtor, default payments or debts more than 60 days overdue are
considered objective evidence of impairment. The amount of the impairment loss is the receivable
carrying amount compared to the present value of estimated future cash flows, discounted at the
original effective interest rate.
Inventories
(n)
Inventories are valued at the lower of cost and net realisable value. Cost includes expenditure incurred
in acquiring and bringing the inventories to their existing condition and location and is determined
using the weighted average cost method.
Interests in Joint Ventures
(o)
The Group’s share of the assets, liabilities, revenue and expenses of joint venture operations are
included in the appropriate items of the consolidated financial statements.
- 57 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
2.
SIGNIFICANT ACCOUNTING POLICIES (Continued)
(p)
Property, plant and equipment
Plant and equipment is stated at historical cost less accumulated depreciation and impairment.
Capital work-in-progress is stated at cost and comprises all costs directly attributable to bringing the
assets under construction ready to their intended use. Capital work-in-progress is transferred to
property, plant and equipment at cost on completion.
Depreciation is calculated on a straight-line basis over the estimated useful life of the asset which
ranges between 3 and 5 years except for buildings which are depreciated over 20 years.
Derecognition
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.
Any gain or loss arising on derecognition of the asset (calculated as the difference between the net
disposal proceeds and the carrying amount of the item) is included in the statement of comprehensive
income in the period the item is derecognised.
(q)
Exploration, evaluation and development expenditure
Expenditure on acquisition, exploration and evaluation relating to an area of interest is capitalised and
carried forward at cost where rights to tenure of the area of interest are current and:
i) it is expected that expenditure will be recouped through successful development and
exploitation of the area of interest or alternatively by its sale; or
ii) exploration and evaluation activities are continuing in an area of interest, but at balance date
have not yet reached a stage which permits a reasonable assessment of the existence or
otherwise of economically recoverable reserves.
A regular review is undertaken of each area of interest to determine the appropriateness of continuing
to carry forward costs in relation to that area of interest. Where uncertainty exists as to the future
viability of certain areas, the value of the area of interest is written off to the statement of
comprehensive income or provided against.
Impairment
The carrying value of capitalised exploration and evaluation expenditure is assessed for impairment
at the cash generating unit level whenever facts and circumstances suggest that the carrying amount
of the asset may exceed its recoverable amount.
An impairment exists when the carrying amount of an asset or cash generating unit exceeds its
recoverable amount. The asset or cash generating unit is then written down to its recoverable amount.
Any impairment losses are recognised in the statement of comprehensive income.
(r) Mine properties and development
Expenditure on the acquisition and development of mine properties within an area of interest are
carried forward at cost separately for each area of interest. Accumulated expenditure is amortised
over the life of the area of interest to which such costs relate on a production output basis.
A regular review is undertaken of each area of interest to determine the appropriateness of continuing
to carry forward costs in relation to that area of interest.
- 58 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
2.
SIGNIFICANT ACCOUNTING POLICIES (Continued)
(r) Mine properties and development (continued)
Impairment
The carrying value of capitalised mine properties and development expenditure is assessed for
impairment whenever facts and circumstances suggest that the carrying amount of the asset may
exceed its recoverable amount.
Recoverable amount is determined for an individual asset, unless the asset does not generate cash
inflows that are largely independent of those from other assets or groups of assets. When the carrying
amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is
written down to its recoverable amount.
(s)
Trade and other payables
Trade and other payables are carried at amortised cost. They represent liabilities for goods and
services provided to the Group prior to the end of the financial year that are unpaid and arise when
the Group becomes obligated to make future payments in respect of the purchase of these goods and
services. The amounts are unsecured and are usually paid within 30 days of recognition.
(t)
Rehabilitation costs
The Consolidated Entity is required to decommission and rehabilitate mines and processing sites at
the end of their producing lives to a condition acceptable to the relevant authorities.
The expected cost of any approved decommissioning or rehabilitation programme, discounted to its
net present value, is provided when the related environmental disturbance occurs. The cost is
capitalised when it gives rise to future benefits, whether the rehabilitation activity is expected to occur
over the life of the operation or at the time of closure. The capitalised cost is amortised over the life
of the operation and the increase in the net present value of the provision for the expected cost is
included in financing expenses. Expected decommissioning and rehabilitation costs are based on the
discounted value of the estimated future cost of detailed plans prepared for each site. Where there is
a change in the expected decommissioning and restoration costs, the value of the provision and any
related asset are adjusted and the effect is recognised in profit or loss on a prospective basis over the
remaining life of the operation.
The estimated costs of rehabilitation are reviewed annually and adjusted as appropriate for changes
in legislation, technology or other circumstances. Cost estimates are not reduced by potential
proceeds from the sale of assets or from plant clean up at closure.
(u)
Interest-bearing loans and borrowings
All loans and borrowings are initially recognised at the fair value of the consideration received, less
directly attributable transaction costs.
After initial recognition, interest-bearing loans and borrowings are subsequently measured at
amortised cost using the effective interest method. Fees paid on the establishment of loan facilities
that are yield related are included as part of the carrying amount of the loans and borrowings.
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 balance date.
- 59 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
2.
SIGNIFICANT ACCOUNTING POLICIES (Continued)
(v)
Borrowing costs
Borrowing costs are recognised as an expense when incurred unless they relate to qualifying assets in
which case they are capitalised.
(w) Employee benefits
Provision is made for the Company’s liability for employee benefits arising from services rendered by
employees to balance date. Employee benefits expected to be settled within one year have been
measured at the amounts expected to be paid when the liability is settled, plus related on-costs.
Employee benefits payable later than one year have been measured at the present value of the
estimated future cash outflows to be made for those benefits.
(x)
Provisions
Provisions are recognised when the Consolidated Entity has a present obligation (legal or constructive)
as a result of a past event, it is probable that an outflow of resources embodying economic benefits
will be required to settle the obligation and a reliable estimate can be made of the amount of the
obligation.
Provisions are measured at the present value of management’s best estimate of the expenditure
required to settle the present obligation at the reporting date. The discount rate used to determine
the present value reflects current market assessments of the time value of money and the risks
specific to the liability. The increase in the provision resulting from the passage of time is recognised
in finance costs.
(y)
Share-based payment transactions
The Consolidated Entity provides benefits to employees (including Directors) in the form of share-
based payment transactions, whereby employees render services in exchange for shares or rights over
shares (equity-settled transactions).
The Consolidated Entity has one plan in place that provides these benefits. It is the Employee Share
Option Plan (“ESOP”) which provides benefits to all employees including Directors. The scheme has
no direct performance requirements. The terms of the share options are as determined by the Board.
Where a participant ceases employment prior to the vesting of their share options, the share options
are forfeited. Where a participant ceases employment after the vesting of their share options, the
share options automatically lapse after one month of ceasing employment unless the Board decides
otherwise at its discretion.
The cost of these equity-settled transactions with employees is measured by reference to the fair
value at the date at which they are granted. The fair value is determined by using a Black & Scholes
model. Further details of which are given in Note 28.
In valuing equity-settled transactions, no account is taken of any vesting conditions, other than
conditions linked to the price of the shares of the Company (market conditions) if applicable.
The cost of equity-settled transactions is recognised, together with a corresponding increase in equity,
over the period in which the performance and/or service conditions are fulfilled (the vesting period),
ending on the date on which the relevant employees become fully entitled to the award (the vesting
date).
- 60 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
2.
(y)
SIGNIFICANT ACCOUNTING POLICIES (Continued)
Share-based payment transactions (continued)
At each subsequent reporting date until vesting, the cumulative charge to the statement of
comprehensive income is the product of (i) the grant date fair value of the award; (ii) the current best
estimate of the number of awards that will vest, taking into account such factors as the likelihood of
employee turnover during the vesting period and the likelihood of non-market performance
conditions being met; and (iii) the expired portion of the vesting period. The charge to the statement
of comprehensive income for the period is the cumulative amount as calculated above less the
amounts already charged in previous periods. There is a corresponding credit to equity.
Until an award has vested, any amounts recorded are contingent and will be adjusted if more or fewer
awards vest than were originally anticipated to do so. Any award subject to a market condition is
considered to vest irrespective of whether or not the market condition is fulfilled, provided that all
other conditions are satisfied.
If a non-vesting condition is within the control of the Consolidated Entity, Company or the employee,
the failure to satisfy the condition is treated as a cancellation. If a non-vesting condition within the
control of neither the Consolidated Entity, Company nor employee is not satisfied during the vesting
period, any expense for the award not previously recognised is recognised over the remaining vesting
period, unless the award is forfeited.
If the terms of an equity-settled award are modified, as a minimum an expense is recognised as if the
terms had not been modified. An additional expense is recognised for any modification that increases
the total fair value of the share-based payment arrangement, or is otherwise beneficial to the
employee, as measured at the date of modification. If an equity-settled award is cancelled, it is treated
as if it had vested on the date of cancellation, and any expense not yet recognised for the award is
recognised immediately. However, if a new award is substituted for the cancelled award, and
designated as a replacement award on the date that it is granted, the cancelled and new award are
treated as if they were a modification of the original award, as described in the previous paragraph.
The dilutive effect, if any, of outstanding options is reflected as additional share dilution in the
computation of earnings per share.
(z)
Revenue
Revenue is recognised when or as the Group transfers control of goods or services to a customer at
the amount to which the Group expected to be entitled. If the consideration promised includes a
variable amount, the Group estimates the amount of consideration to which it will be entitled. The
following specific recognition criteria must be met before revenue is recognised:
Sale of goods
The Group recognises revenue when it satisfies a performance obligation by transferring a promised
good or service to a customer which occurs when control of goods or services have been transferred
to the buyer and the associated costs can be estimated reliably, there is no continuing management
involvement with the goods, and the amount of revenue can be measured reliably. Revenue from ore
sales is brought to account when the control of goods or services is transferred have transferred to
the buyer and selling prices are known or can be reasonably estimated.
R&D Refund
Revenue is recognised on receipt of refunds from the Australian Taxation Office for research and
development expenditure incurred during the previous financial year.
- 61 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
2.
(z)
SIGNIFICANT ACCOUNTING POLICIES (Continued)
Revenue (continued)
Dividend Income
Revenue is recognised on receipt of dividends from listed investments.
Finance income
Income is recognised as interest accrues using the effective interest method. This is a method of
calculating the amortised cost of a financial asset and allocating the interest income over the relevant
period using the effective interest rate, which is the rate that exactly discounts estimated future cash
receipts through the expected life of the financial asset to the net carrying amount of the financial
asset.
COVID-19 Government Grant
Cash flow boost incentive from the government is recognised when it is received or when the right to
receive payment is established.
(aa)
Income tax
Deferred income tax is provided on all temporary differences at the reporting date between the tax
bases of assets and liabilities and their carrying amounts for financial reporting purposes.
Deferred income tax liabilities are recognised for all taxable temporary differences:
• when the deferred income tax liability arises from the initial recognition of an asset or liability in
a transaction that is not a business combination and, at the time of the transaction, affects
neither the accounting profit nor taxable profit or loss; and
• when the taxable temporary differences associated with investments in subsidiaries, associates
and interests in joint ventures, except where the timing of the reversal of the temporary
differences can be controlled and it is probable that the temporary differences will not reverse
in the foreseeable future.
Deferred income tax assets are recognised for all deductible temporary differences, carry-forward of
unused tax assets and unused tax losses, to the extent that it is probable that taxable profit will be
available against which the deductible temporary differences, and the carry-forward of unused tax
assets and unused tax losses can be utilised:
• when the deferred income tax asset relating to the deductible temporary difference arises from
the initial recognition of an asset or liability in a transaction that is not a business combination
and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss;
and
• when the deductible temporary differences associated with investments in subsidiaries,
associates and interests in joint ventures, deferred tax assets are only recognised to the extent
that it is probable that the temporary differences will reverse in the foreseeable future and
taxable profit will be available against which the temporary differences can be utilised.
The carrying amount of deferred income tax assets is reviewed at each reporting date and reduced to
the extent that it is no longer probable that sufficient taxable profit will be available to allow all or
part of the deferred income tax asset to be utilised.
Unrecognised income taxes are reassessed at each reporting date and are recognised to the extent
that it has become probable that future taxable profit will allow the deferred tax asset to be
recovered.
- 62 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
2.
SIGNIFICANT ACCOUNTING POLICIES (Continued)
(aa)
Income tax (continued)
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to
the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have
been enacted or substantively enacted at the reporting date.
Income taxes relating to items recognised directly in equity are recognised in equity and not in the
statement of comprehensive income.
Deferred tax assets and deferred tax liabilities are offset only if a legally enforceable right exists to set
off current tax assets against current tax liabilities and the deferred tax assets and liabilities relate to
the same taxable entity and the same taxation authority.
(ab) Contributed equity
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new
shares or options are shown in equity as a deduction, net of tax, from the proceeds.
The amount of benefits brought to account or which may be realised in the future is based on the
assumption that no adverse change will occur in income taxation legislation and the anticipation that
the economic entity will derive sufficient future assessable income to enable the benefit to be realised
and comply with the conditions of deductibility imposed by the law.
(ac) Other taxes
Revenues, expenses and assets are recognised net of the amount of GST except:
• when the GST incurred on a purchase of goods and services is not recoverable from the
taxation authority, in which case the GST is recognised as part of the cost of acquisition of the
asset or as part of the expense item as applicable; and
receivables and payables, which are stated with the amount of GST included.
•
The net amount of GST recoverable from, or payable to, the taxation authority is included as part of
receivables or payables in the statement of financial position.
Cash flows are included in the statement of cash flows on a gross basis and the GST component of
cash flows arising from investing and financing activities, which is recoverable from, or payable to, the
taxation authority are classified as operating cash flows.
Commitments and contingencies are disclosed net of amounts of GST recoverable from, or payable
to, the taxation authority.
(ad) Earnings per share
Basic earnings per share is calculated as net profit attributable to members of the parent, adjusted to
exclude any costs of servicing equity (other than dividends) and preference share dividends, divided
by the weighted average number of ordinary shares, adjusted for any bonus element.
Diluted earnings per share is calculated as net profit attributable to members of the parent, adjusted
for:
•
•
costs of servicing equity (other than dividends) and preference share dividends;
the after tax effect of dividends and interest associated with dilutive potential ordinary
shares that have been recognised as expenses; and
• other non-discretionary changes in revenue or expenses during the period that would result
from the dilution of potential ordinary shares.
- 63 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
SIGNIFICANT ACCOUNTING POLICIES (Continued)
2.
(ad) Earnings per share (continued)
Divided by the weighted average number of ordinary shares and dilutive potential ordinary shares,
adjusted for any bonus element.
(ae)
Financial Position
The financial report has been prepared on the going concern basis, which contemplates continuity of
normal business activities and the realisation of assets and settlements of liabilities in the ordinary
course of business.
The Group has reported a loss for the year of $5,235,103 (2019: $4,947,360), a cash inflow from
operating activities of $1,422,019 (2019: inflow $1,312,567) and a working capital deficit of
$1,033,379 (2019: $682,709).
At year end, the Group had $1,797,908 (2019: $901,148) in cash and term deposit balances and
$4,047,600 (2019: $1,830,206) of investments in listed securities. In addition, subsequent to 30 June
2020, the Group completed a capital raise of $6,600,000 before costs.
Management has prepared a cash flow forecast and have the ability to manage at their discretionary
the forecast expenditure to be in line with the Group’s actual cash flow.
Based on the above facts, the Directors consider the going basis of preparation to be appropriate.
3.
SIGNIFICANT ACCOUNTING JUDGEMENTS, ESTIMATES AND ASSUMPTIONS
The preparation of the financial statements requires management to make judgements, estimates
and assumptions that affect the reported amounts in the financial statements. Management
continually evaluates its judgements and estimates in relation to assets, liabilities, contingent
liabilities, revenue and expenses. Management bases its judgements and estimates on historical
experience and on other various factors it believes to be reasonable under the circumstances, the
result of which form the basis of the carrying values of assets and liabilities that are not readily
apparent from other sources.
Management has identified the following critical accounting policies for which significant judgements,
estimates and assumptions are made. Actual results may differ from these estimates under different
assumptions and conditions and may materially affect financial results or the financial position
reported in future periods.
Further details of the nature of these assumptions and conditions may be found in the relevant notes
to the financial statements.
Significant accounting estimates and assumptions
Share-based payment transactions
The Consolidated Entity measures the cost of equity-settled transactions with employees by reference
to the fair value of the equity instruments at the date at which they are granted. The fair value is
determined by using a Black & Scholes model, using the assumptions as discussed in Note 28. The
accounting estimates and assumptions relating to equity-settled share-based payments would have
no impact on the carrying amounts of assets and liabilities in the next annual reporting period but may
impact expenses and equity.
- 64 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
3.
SIGNIFICANT ACCOUNTING JUDGEMENTS, ESTIMATES AND ASSUMPTIONS (Continued)
Impairment of capitalised exploration and evaluation expenditure
The future recoverability of capitalised exploration and evaluation expenditure is dependent on a
number of factors, including whether the Consolidated Entity decides to exploit the related lease itself
or, if not, whether it successfully recovers the related exploration and evaluation asset through sale.
Factors that could impact the future recoverability include the level of reserves and resources, future
technological changes, which could impact the cost of mining, future legal changes (including changes
to environmental restoration obligations) and changes to commodity prices.
To the extent that capitalised exploration and evaluation expenditure is determined not to be
recoverable in the future, profits and net assets will be reduced in the period in which this
determination is made.
In addition, exploration and evaluation expenditure is capitalised if activities in the area of interest have
not yet reached a stage that permits a reasonable assessment of the existence or otherwise of
economically recoverable reserves. To the extent it is determined in the future that this capitalised
expenditure should be written off, profits and net assets will be reduced in the period in which this
determination is made.
Impairment of financial assets
In determining the amount of impairment of financial assets, the Consolidated Entity has made
judgements in identifying financial assets whose decline in fair value below cost is considered
“significant” or “prolonged”. A significant decline is assessed based on the historical volatility of the
share price.
The higher the historical volatility, the greater the decline in fair value required before it is likely to be
regarded as significant. A prolonged decline is based on the length of time over which the share price
has been depressed below cost. A sudden decline followed by immediate recovery is less likely to be
considered prolonged compared to a sustained fall of the same magnitude over a longer period.
The Consolidated Entity considers a less than a 10% decline in fair value is unlikely to be considered
significant for investments actively traded in a liquid market, whereas a decline in fair value of greater
than 20% will often be considered significant. For less liquid investments that have historically been
volatile (standard deviation greater than 25%), a decline of greater than 30% is usually considered
significant.
Generally, the Consolidated Entity does not consider a decline over a period of less than three months
to be prolonged. However, where the decline in fair value is greater than six months for liquid
investments and 12 months for illiquid investments, it is usually considered prolonged.
Impairment of property, plant and equipment
Property, plant and equipment is reviewed for impairment if there is any indication that the carrying
amount may not be recoverable. Where a review for impairment is conducted, the recoverable amount
is assessed by reference to the higher of “value in use” (being net present value of expected future cash
flows of the relevant cash generating unit) and “fair value less costs to sell.”
In determining the value in use, future cash flows are based on:
• estimates of the quantities of ore reserves and mineral resources for which there is a high
degree of confidence of economic extraction;
future production levels;
future commodity prices; and
future cash costs of production and capital expenditure.
•
•
•
- 65 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
3.
SIGNIFICANT ACCOUNTING JUDGEMENTS, ESTIMATES AND ASSUMPTIONS (Continued)
Variations to the expected cash flows, and the timing thereof, could result in significant changes to any
impairment losses recognised, if any, which in turn could impact future financial results.
Mine rehabilitation provision
The Consolidated Entity assesses its mine rehabilitation provision on an annual basis in accordance with
the accounting policy stated in Note 2(r). In determining an appropriate level of provision,
consideration is given to the expected future costs to be incurred, the timing of those future costs
(largely dependent on the life of mine) and the estimated level of inflation. The ultimate rehabilitation
costs are uncertain, and cost estimates can vary in response to many factors, including estimates of the
extent and costs of rehabilitation activities, technological changes, regulatory changes, cost increases
as compared to the inflation rates, and changes in discount rates. The expected timing of expenditure
can also change, for example in response to changes in reserves or to production rates. These
uncertainties may result in future actual expenditure differing from the amounts currently provided.
Therefore, significant estimates and assumptions are made in determining the provision for mine
rehabilitation. As a result, there could be significant adjustments to the provisions established which
would affect future financial result. The provision at reporting date represents management’s best
estimate of the present value of the future rehabilitation costs required.
4.
SEGMENT REPORTING
Identification of reportable segment
The Group identifies its operating segments based on the internal reports that are reviewed and used
by the Board of Directors (chief operating decision maker) in assessing performance and determining
the allocation of resources.
The Group operates primarily in mineral exploration in Western Australia and Thailand. The Group
was awarded Special Prospecting Licences (SPL’s) in Thailand in March 2015 for the first time.
Accordingly the Group now considers that it operates in two geographical segments but within the
same operating segment, mineral exploration. The decision to allocate resources to individual projects
is predominantly based on available cash reserves, technical data and the expectation of future metal
prices.
Accordingly, the Group effectively operates as one segment, being mineral exploration. The financial
information presented in the statement of comprehensive income and statement of financial position
is the same as that presented to the chief operating decision maker.
Basis of accounting for purposes of reporting by operating segments
Accounting policies adopted
Unless stated otherwise, all amounts reported to the Board of Directors as the chief operating decision
maker is in accordance with accounting policies that are consistent to those adopted in the annual
financial statements of the Group.
- 66 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
4.
SEGMENT REPORTING (Continued)
Information about reportable segments
Information relating to each reportable segment is shown below.
2020
External revenues
Inter-segment revenue
Segment revenue
Segment profit/(loss) before tax
Interest income
Interest expense
Depreciation and amortisation
Share of profit/(loss) of equity accounted
investees
Other material non-cash items
-
Impairment of losses of non-financial
assets
Segment assets
Equity accounted investees
Capital expenditure
Segment liabilities
2019
External revenues
Inter-segment revenue
Segment revenue
Segment profit/(loss) before tax
Interest income
Interest expense
Depreciation and amortisation
Share of profit/(loss) of equity accounted
investees
Other material non-cash items
-
Impairment of losses of non-financial
assets
Segment assets
Equity accounted investees
Capital expenditure
Segment liabilities
Reportable Segments
Australia
$
11,179,466
-
11,179,466
(4,410,510)
18,282
(558,651)
(2,894,059)
Thailand
$
120,722
-
120,722
(824,593)
606
-
(94)
Total
$
11,300,188
-
11,300,188
(5,235,103)
18,888
(558,651)
(2,894,153)
(199,882)
-
(199,882)
-
26,458,786
155,735
860,990
11,700,985
-
652,486
-
-
2,053
-
27,111,272
155,735
860,990
11,703,038
Reportable Segments
Australia
$
12,210,506
-
12,210,506
(3,713,548)
30,566
(446,271)
(1,011,655)
Thailand
$
11,450
-
11,450
(1,233,812)
2,183
-
(2,678)
Total
$
12,221,956
-
12,221,956
(4,947,360)
32,749
(446,271)
(1,014,333)
(487,915)
-
(487,915)
-
20,903,675
355,617
1,437,218
8,759,905
-
1,073,563
-
-
(27,948)
-
21,977,238
355,617
1,437,218
8,731,957
- 67 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
5. Income and Expenses
The loss before income tax includes the following revenues
whose disclosure is relevant in explaining the performance of
the entity:
(a) Other income
R&D tax incentive refund
Net gain on sale of plant and equipment
Net gain on sale of tenements
Other income
(b) Finance income
Interest earned
(c) Expenses included in the statement of comprehensive
income
Depreciation and amortisation expenses
Mine property depreciation
Mine capital development amortisation
Property plant and equipment depreciation
Right-of-use assets depreciation
Disclosure in Statement of Profit and Loss
Amortisation and depreciation
Depreciation expense
(d) Other expenses
(i) Employee benefits expense
Salaries and wages
Superannuation expenses
Share based payments
Total employee benefits expense
(ii) Administration and other expenses
Operating lease rentals
Care and maintenance
Administration expenses
2020
$
2019
$
137,630
2,141
-
479,449
619,220
100,570
61,483
160,985
335,549
658,587
18,888
32,749
272,373
1,943,841
542,639
135,300
2,894,153
2,692,144
202,009
2,894,153
1,179,383
65,387
297,042
1,541,812
72,802
-
1,318,549
1,391,351
2,933,163
163,149
532,569
318,615
-
1,014,333
695,718
318,615
1,014,333
1,185,747
62,799
882,611
2,131,157
166,552
1,232,675
2,344,385
3,743,612
5,874,769
- 68 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
2020
$
2019
$
-
-
-
-
-
-
6. Income taxes
Tax expense/(income) comprises:
Current tax expense/(income)
Deferred tax expense/(income)
Income tax recognised in profit or loss
The prima facie income tax expense/(income) on the pre-tax
accounting profit/(loss) from operations reconciles to the
income tax expense/(income) in the financial statements as
follows:
Loss from continuing operations
(5,235,103)
(4,947,360)
Income tax expense calculated at 27.5% (2019: 27.5%)
(1,439,653)
(1,360,524)
Non-deductible expenses
Non-assessable income
Effect of temporary differences not recognised in current year
Effect of change in income tax rate
Effect of temporary differences that would be recognised
directly in equity
Adjustments recognised in the current year in relation to the
current tax of previous years
Income tax expense
177,949
(40,203)
787,072
549,341
244,280
(18,399)
1,473,124
280,118
(128,194)
(530,047)
93,688
-
(88,552)
-
The tax rate used in the above reconciliation is the corporate tax rate of 27.5% (2019: 27.5%) payable
by Australian corporate entities on taxable profits under Australian tax law.
Unrecognised deferred tax assets/(liabilities)
The following deferred tax assets have not been brought to
account:
Tax losses - revenue
Investments
Temporary differences - exploration
Section 40-880 expenses
Other temporary differences
2020
$
2019
$
7,737,412
115,679
(2,148,716)
159,686
(242,445)
5,621,616
6,704,156
343,281
(2,362,128)
42,839
106,396
4,834,544
The ability of the Group to utilise unrecognised tax losses will depend on whether the Group meets
the statutory requirements for utilising tax losses as and when it generates taxable profit.
- 69 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
7. Trade and other receivables
Current
Trade debtors
Amounts receivable from Australian Taxation Authorities
Other receivables
8. Other assets
Current
Prepayments
Cash backed performance bond (i)
Non-current
Deposits held (ii)
2020
$
2019
$
1,423,669
9,363
98,977
1,532,009
2020
$
49,469
32,615
82,084
324,895
324,895
192,087
7,700
117,501
317,288
2019
$
35,953
31,872
67,825
327,662
327,662
(i) The Company’s bankers have provided performance bonds as security for the due and proper
performance of leases in accordance with the tenement conditions associated with certain Group
tenements. The Company has cash-backed performance bonds with fixed term deposits with the
bank.
(ii) The Company has cash deposits held with the Thailand government with respect to a number of
tenement applications in Thailand. Prior to changes in the Thailand Mineral Act (2017), should the
applications not be successful 75% of the deposits will be returned to the Company. This has now
been changed such that deposits will be refunded in full and any impairments previously
recognised have been written back. In the prior financial year, a cumulative impairment
(representing the non-recoverable 25%) of $109,221 has been made against the deposits held of
$436,883.
9. Inventories
Current
Ore stocks
Stores and spares at cost
Total inventories at lower of cost and net realisable value
10. Other
Other financial assets
- 70 -
2020
$
2019
$
354,385
219,486
573,871
-
106,923
106,923
2020
$
2019
$
351,600
351,600
1,110,206
1,110,206
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
10. Other (continued)
Movements in financial assets:
At 1 July
Additions
Disposals
Net change in investments
At 30 June
2020
$
2019
$
1,110,206
185,400
(1,117,638)
173,632
351,600
2,683,246
735,000
(1,059,744)
(1,248,296)
1,110,206
Other financial assets consist of investments in ordinary shares, and therefore have no fixed maturity
date or coupon rate.
Listed shares
(i) The Company holds shares in Panoramic Resources Limited (ASX: PAN), which is involved in the
mining and exploration of base metals in Australia and Canada. Panoramic is listed on the
Australian Securities Exchange.
At the end of the year the fair value of the investment was $194,400 (30 June 2019: $1,051,238)
which is based on Panoramic Resources Limited’s quoted share price.
(ii) The Company holds shares in Anova Minerals Limited (ASX: AWV), which is involved in
exploration and development of gold in Western. AWV is listed on the Australian Securities
Exchange.
At the end of the year the Company’s investment was $157,200 (30 June 2019: $58,750) which
is based on AWV’s quoted share price.
11. Equity Accounted Investments
The Company has a 26.77% (2019: 26.77%) interest in Bulletin Resources Limited (ASX: BNR), which
is involved in the exploration of precious and base metals in Australia. Bulletin is listed on the
Australian Securities Exchange.
2020
$
Movements in carrying value of the Company’s investment in associate:
At 1 July
Share of loss after income tax
Share of change in reserves
At 30 June
355,617
(199,882)
-
155,735
2019
$
843,532
(487,915)
-
355,617
- 71 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
11. Equity Accounted Investments (continued)
The following table illustrates the summarised financial information of the Company’s investment
in Bulletin:
Current assets
Non-current assets
Current liabilities
Non-current liabilities
Equity
2020
$
1,830,416
239,027
(513,432)
-
1,556,011
2019
$
2,277,397
85,484
(224,172)
-
2,138,709
Company’s share of loss for the year
(199,882)
(487,915)
The associate had no contingent liabilities or capital commitments as at 30 June 2020.
12. Exploration and evaluation assets
Exploration expenditure capitalised at cost
-exploration and evaluation phase
Movements in carrying amounts
Exploration and evaluation phase
Balance at beginning of year
Acquisition of tenements
Disposal of tenements
Exploration and evaluation expenditure incurred
Expenditure written off/impaired
Transferred from/(to) mine property and development
Balance at end of year
2020
$
2019
$
18,537,147
18,537,147
16,355,239
16,355,239
16,355,239
177,166
(758,306)
3,504,250
(741,202)
-
18,537,147
14,874,547
823,910
(499,015)
2,955,816
(991,482)
(808,537)
16,355,239
The ultimate recoupment of costs carried forward for exploration and evaluation phase is dependent
on the successful development and commercial exploitation or sale of the respective areas.
- 72 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
13. Mine Property and Development
Mine properties
Balance at beginning of year
Transferred from/(to) exploration and evaluation assets
Additions
Depreciation expense for the period
Balance at end of year
Mine capital development
Balance at beginning of year
Additions
Amortisation expense for the period
Balance at end of year
2020
$
2019
$
649,941
-
-
(272,373)
377,568
-
3,235,276
(1,943,841)
1,291,435
473,973
275,968
-
(100,000)
649,941
-
532,569
(532,569)
-
Total mine properties and development
1,669,003
649,941
2020
$
2019
$
3,816,356
(1,915,339)
1,901,017
1,901,017
Plant and
Equipment
$
748,454
1,437,217
(18,518)
(63,149)
(318,615)
1,785,389
860,990
(3,318)
(199,405)
(542,639)
1,901,017
3,239,946
(1,454,557)
1,785,389
1,785,389
Total
$
748,454
1,437,217
(18,518)
-
(381,764)
1,785,389
694,553
(78,318)
-
(500,607)
1,901,017
14. Property, plant and equipment
Plant and equipment at cost
Accumulated depreciation
Total property, plant and equipment
Movements in carrying amounts
Consolidated
Balance 30 June 2018
Additions
Disposals
Depreciation transferred to mine properties
Depreciation expense
Balance 30 June 2019
Additions
Disposals
Assets transferred to Right of use assets
Depreciation expense
Balance 30 June 2020
- 73 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
15. Right-of-use-assets & lease liabilities
The Group has adopted AASB 16 Leases retrospectively from 1 July 2019, but has not restated
comparatives for the 2019 reporting period, as permitted under the specific transitional provisions in
the standard. The reclassifications and the adjustments arising from the new leasing rules are
therefore recognised in the opening balance sheet on 1 July 2019.
The Group has lease contracts for various items of equipment, motor vehicles and office premises
used in its operations. Leases generally have lease terms between two and four years.
Set out below are the carrying amounts of right-of-use assets recognised and the movements during
the period:
Right-of-use-assets
Carrying Amount
Cost
Accumulated depreciation
As at 30 June 2020
Reconciliation
As at 1 July 2019
Premises
$
122,707
(77,302)
45,405
Premises
$
Equipment
$
36,772
(35,695)
1,077
Equipment
$
Motor
Vehicles
$
230,308
(89,977)
140,331
Total
$
389,787
(202,974)
186,813
Motor
Vehicles
$
204,737
-
(64,406)
140,331
Total
$
340,765
-
(153,952)
186,813
Additions
Depreciation expense*
As at 30 June 2020
*Amount of $18,652 has been capitalised to mine capital development. During the year $135,300 was
expensed.
Lease liabilities
13,321
-
(12,244)
1,077
122,707
-
(77,302)
45,405
Set out below are the carrying amounts of lease liabilities.
Carrying Value 2020
Current liabilities
Non-current liabilities
As at 30 June 2020
Carrying Value 2019
Current liabilities
Non-current liabilities
As at 30 June 2019
Equipment
$
1,902
-
1,902
Premises
$
47,845
-
47,845
Equipment
$
Premises
$
15,862
1,902
17,764
-
-
-
Motor
Vehicles
$
42,262
60,514
102,776
Motor
Vehicles
$
86,411
96,204
182,615
Total
$
92,009
60,514
152,523
Total
$
102,273
98,106
200,379
A maturity analysis of future minimum lease payments is presented in Note 27.
- 74 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
15. Right-of-use-assets & lease liabilities (continued)
Movement for the period
Recognised on 1 July 2019
New leases entered
Principal repayments
- Repayments
- Interest
Leases terminated
As at 30 June 2020
16. Trade and other payables
Unsecured liabilities
Trade payables
Sundry creditors and accrued expenses
17. Borrowings
Equipment
$
17,764
-
(15,862)
(16,561)
-
1,902
Premises
$
122,707
-
(74,862)
(81,477)
6,615
-
47,845
Motor
Vehicles
$
182,615
-
(79,839)
(89,434)
9,595
-
102,776
Total
$
323,086
-
(170,563)
(187,472)
16,909
-
152,523
699
2020
$
2019
$
3,262,672
1,359,208
4,621,880
2020
$
1,177,144
538,474
1,715,618
2019
$
Non Current
Secured liabilities
Loan (ii)
3,960,846
3,960,846
(i) Due to the introduction of AASB 16 Leases all finance lease liabilities are now disclosed in Note
3,973,264
3,973,264
15.
(ii)
Reconciliation of loan
Balance at beginning of year
Amount borrowed
Share based payment
Interest capitalised
Balance at end of year
2020
$
3,960,846
-
-
12,418
3,973,264
2019
$
2,937,521
1,000,000
-
23,325
3,960,846
On 8 August 2017 Matsa entered into loan agreements with two separate parties for a $4M facility
with the funds being predominantly used as a working capital facility to ensure smooth operations
of the trial mine at the Fortitude Gold Project and to conduct further exploration at Lake Carey.
The repayment date was initially 31 July 2018 but was extended by mutual consent on 12 April
2018 to 31 July 2019. On 5 May 2019 a further $1M was borrowed and the repayment date
extended to 31 July 2020. On 29 May 2020 the repayment date was extended to 31 July 2022. On
this basis the loan has been disclosed as non-current.
- 75 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
17. Borrowings (Continued)
The key terms of the finance facility are as follows:
Principal Amount: $5,000,000 ($4M drawn down and $1M any time if required)
Interest Rate:
12% per annum paid monthly in arrears (penalty rate of 18% if Matsa is in
default)
Repayable by 31 July 2022
The loan facility is secured by a mortgage over the Fortitude gold project, the
Symons Hill project and a Deed of Charge over the Company’s shareholdings
in Bulletin Resources Limited and Panoramic Resources Limited.
Term:
Security:
At the time of the original loan Matsa agreed to issue a total of 1 million options in the Company,
split equally amongst the parties, with an exercise price of $0.20 each with a two year life from the
date of issue. The principal loan balance of $4M has been offset by the value of the options issued.
At the end of the year the carrying value of the loan was $3,973,264. In return for the loan
extension, Matsa agreed to pay each of the lenders an annual Facility Fee of 150,000 fully paid
ordinary shares for every year or part year that the loans remain outstanding. There is one Facility
Fee of 150,000 shares to be issued on or about 1st June 2021.
2020
$
2019
$
304,552
304,552
258,002
258,002
223,737
2,427,082
2,650,819
176,136
2,420,976
2,597,112
2020
$
2019
$
176,136
47,601
223,737
154,548
21,588
176,136
2,420,976
6,106
2,427,082
2,404,058
16,918
2,420,976
18. Provisions
Current
Provision for annual leave
Non-current
Provision for long service leave
Provision for mine restoration
Movement in long service leave provision
Opening balance 1 July
Increase in provision
Closing balance 30 June
Movement in provision for mine restoration
Opening balance 1 July
Increase/(decrease) in provision
Closing balance 30 June
- 76 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
19. Issued capital
227,067,368 (2019: 176,917,368) fully
paid ordinary shares
Ordinary shares
At the beginning of reporting period
Share placements
Shares issued as a facility fee
Transaction costs
At reporting date
2020
No.
2019
No.
2020
$
2019
$
51,348,741
44,292,467
176,917,368
50,000,000
150,000
-
227,067,368
176,917,368
-
-
-
176,917,368
44,292,467
7,550,000
19,050
(512,776)
51,348,741
44,292,467
-
-
-
44,292,467
Ordinary shares participate in dividends and the proceeds on winding up of the parent entity in
proportion to the number of shares held. At shareholders meetings each ordinary share is entitled to
one vote when a poll is called, otherwise each shareholder has one vote on a show of hands.
Options
The movement of the options on issue during the financial year is set out below:
Exercise
Price
$0.25
$0.25
$0.30
$0.17
$0.17
$0.25
$0.35
$0.175
Expiry Date
30 November 2019
30 November 2019
30 November 2019
30 November 2021
30 November 2021
31 May 2021
30 November 2022
30 November 2022
Issued
Balance at
beginning
of year
3,900,000
5,750,000
3,775,025
5,000,000
3,600,000
-
-
-
-
-
- 11,000,000
1,000,000
-
5,750,000
-
22,025,025 17,750,000
20. Reserves
Equity settled transaction
Other reserves
Equity settled transaction reserve
Balance at beginning of financial year
Share based payment
Balance at end of financial year
Exercised
-
-
-
-
-
-
-
-
-
Lapsed
(3,900,000)
(5,750,000)
(3,775,025)
-
-
-
-
-
(13,425,025)
Balance at
end of year
-
-
-
5,000,000
3,600,000
11,000,000
1,000,000
5,750,000
26,350,000
2020
$
2019
$
9,752,588
-
9,752,588
9,410,806
341,782
9,752,588
9,410,806
(13,844)
9,396,962
8,528,195
882,611
9,410,806
The equity settled transaction reserve records share-based payment transactions.
- 77 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
20. Reserves (continued)
2020
$
(13,844)
-
13,844
-
2019
$
1,927,447
(1,941,291)
(13,844)
Other reserve
Balance at beginning of financial year
Adjustments on the initial application of AASB 9
Amount transferred to accumulated losses (i)
Balance at end of financial year
(i)
This amount relates to prior years recognition of share of reserves from its associate Bulletin
Resources Limited reversed to accumulated losses in the current year.
21. Accumulated losses
Accumulated losses at beginning of financial year
Adjustments on the initial application of AASB 9
Amount transferred from other reserves (note 20)
Loss for the year
Accumulated losses at end of financial year
22.
Loss per share
The loss and weighted average number of ordinary shares used
in the calculation of loss per share are as follows:
Loss
Weighted average number of ordinary shares
2020
$
2019
$
40,521,595
-
13,844
5,235,383
45,770,822
37,515,368
(1,941,291)
-
4,947,518
40,521,595
2020
$
2019
$
5,235,383
4,947,518
No.
210,042,368
No.
176,917,368
Diluted loss per share
Diluted loss per share has not been calculated as the Company’s potential ordinary shares are not
considered dilutive and do not increase loss per share.
23. Commitments and Contingencies
Exploration and expenditure commitments
In order to maintain the mineral tenements in which the Company and other parties are involved, the
consolidated entity is committed to fulfil the minimum annual expenditure conditions under which
the tenements are granted. The minimum estimated expenditure commitment requirement for
granted tenements for the next year is $2,128,754 (2019: $2,176,578). This amount has not been
provided for in the financial report. These obligations are capable of being varied from time to time.
Exploration expenditure commitments beyond twelve months cannot be reliably determined.
Mine Development and Operating Commitments
The mine development and operating costs are determined on a time and cost basis.
Contingencies
There are no contingent assets or contingent liabilities as at 30 June 2020.
- 78 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
24.
Subsidiaries
Parent Entity
Matsa Resources Limited
Subsidiary
Matsa Gold Pty Ltd
Killaloe Minerals Pty Ltd
Lennard Shelf Exploration Pty Ltd
Red October Gold Pty Ltd
Australian Strategic and Precious
Metals Investment Pty Ltd
Matsa Resources (Aust) Pty Ltd
Matsa Iron Pty Ltd
Cundeelee Pty Ltd
Matsa (Thailand) Co Ltd
PVK Mining Loei Co Ltd
Khlong Tabaek Co Ltd
Paisali Mining Co Ltd
Wichan Buri Resources Co Ltd
Siam Copper Resources Co Ltd
Loei Mining Co Ltd
Azure Circle Co Ltd
25. Cash Flow Information
Country of Incorporation
Percentage Owned (%)
2020
2019
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Thailand
Thailand
Thailand
Thailand
Thailand
Thailand
Thailand
Thailand
100
100
100
100
100
100
100
100
100
100
95
95
100
100
100
100
100
100
100
100
100
100
100
100
100
100
95
95
100
100
100
100
Reconciliation of cash and cash equivalents
Cash and cash equivalents at the end of the financial year as shown in the statement of cash flows is
reconciled to the related items in the statement of financial position as follows:
Cash and cash equivalents
1,797,098
901,148
2020
$
2019
$
- 79 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
25. Cash flow information (Continued)
Reconciliation of loss for year to net cash flows from operating activities
Profit/(loss) for year
(5,235,103)
(4,947,360)
2020
$
2019
$
Non-cash flows in loss from ordinary activities:
Share-based payments
Depreciation
Exploration expenditure written off
Share of investee loss
Net (gain)/(loss) on sale of financial assets
Net (gain)/loss on disposal of plant and equipment
Net loss on tenements
Net change in investments
Interest expense classified as financing cash flow
Amortisation
Reversal of provision for tenement application money
Changes in assets and liabilities:
Decrease/(increase) in receivables
Decrease/(increase) in inventories
Increase/(decrease) in trade creditors and accruals
Increase/(decrease) in provisions
Cash provided by operating activities
Reconciliation of liabilities arising from financing activities
297,042
202,009
741,202
199,882
517,538
(2,541)
8,306
(173,632)
492,418
2,692,144
(111,761)
(1,214,721)
(466,948)
3,375,926
100,258
1,422,019
2020
Opening balance
Cash flows
Non cash charges
Adoption of AASB 16 on lease premises
Closing balance
2019
Opening balance
Cash flows
Non-cash changes
Closing balance
Lease
Liabilities
$
200,379
(170,563)
-
122,707
152,523
Lease
Liabilities
$
89,355
(110,817)
221,841
200,379
Long Term
Borrowings
$
3,960,846
-
12,418
-
3,973,264
Long Term
Borrowings
$
2,937,521
1,000,000
23,325
3,960,846
- 80 -
882,611
318,615
932,168
487,915
194,649
(61,483)
59,314
1,248,296
449,724
695,718
-
583,118
-
390,341
78,941
1,312,567
Total
$
4,161,225
(170,563)
12,418
122,707
4,125,787
Total
$
3,026,876
889,183
245,166
4,161,225
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
26. Parent Entity Disclosures
As at, and throughout, the financial year ended 30 June 2020, the parent company of the Group was
Matsa Resources Limited.
Result of the parent Entity
Profit/(loss) for the year
Other comprehensive gain/(loss)
Total comprehensive profit/(loss) for the year
Financial position of parent entity at year end
Current assets
Total assets
Current liabilities
Total liabilities
Total equity of the parent entity comprising of:
Share capital
Reserves
Accumulated losses
Total equity
27.
Financial instruments
Financial risk management
Company
2020
$
2019
$
(4,360,533)
-
(4,360,533)
(10,655,157)
-
(10,655,157)
975,470
15,938,597
880,196
12,076,598
2,169,690
6,366,691
1,307,129
5,542,217
51,348,741
9,752,590
(51,529,425)
44,292,467
9,393,601
(47,151,686)
9,571,906
6,534,382
Overview
This note presents information about the Group’s exposure to credit, liquidity and market risks, their
objectives, policies and processes for measuring and managing risk, and the management of capital.
The Group does not use any form of derivatives as it is not at a level of exposure that requires the use
of derivatives to hedge its exposure. Exposure limits are reviewed by management on a continuous
basis. The Group does not enter into or trade financial instruments, including derivative financial
instruments, for speculative purposes.
The Board of Directors has overall responsibility for the establishment and oversight of the risk
management framework. Management monitors and manages the financial risks relating to the
operations of the group through regular reviews of the risks.
Credit risk
Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial
instrument fails to meet its contractual obligations, and arises principally from the Group’s cash
balances at bank, deposits with statutory authorities.
- 81 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
Financial instruments (Continued)
27.
Presently, the Group undertakes exploration and evaluation activities exclusively in Australia and
South-East Asia. At the balance date there were no significant concentrations of credit risk with the
exception of its cash balances at bank.
Cash and cash equivalents
The Group limits its exposure to credit risk by only investing in liquid securities and only with
counterparties that have an acceptable credit rating of no less than AA rating.
Trade and other receivables
The Group manages its exposure to credit risk by extensive due diligence on the party processing its
gold sales.
Exposure to credit risk
The carrying amount of the Group’s financial assets represents the maximum credit exposure. The
Group’s maximum exposure to credit risk at the reporting date was:
Trade and other receivables
Cash and cash equivalents
Deposits held
Impairment of deposits (refer Note 8 (ii))
Consolidated
Carrying amount
2020
$
1,522,646
1,797,098
324,895
-
2019
$
309,588
901,148
436,883
(109,221)
The Group has $183,910 in other receivables that are past due (2019: $183,910).
Liquidity risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due.
The Group’s approach to managing liquidity is to ensure, as far as possible, that it will always have
sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without
incurring unacceptable losses or risking damage to the Group’s reputation.
The Group manages liquidity risk by maintaining adequate cash reserves from funds raised in the
market and by continuously monitoring forecast and actual cash flows. The Group also has
investments in listed shares that could be sold to raise cash.
The Company has leased assets financed by way of finance leases and has taken out a premium
funding facility over their insurance requirements.
The following are the contractual maturities of financial liabilities, including estimated interest
payments and excluding the impact of netting agreements:
30 June 2020
Weighted
average
interest
rate
%
Carrying
amount
Contractual
cash flows
6 mths or
less
6-12
mths
1-2
years
2-5 years
$
$
$
$
$
$
Trade and other
payables
Lease liabilities
Loan
6.77
12
4,621,880
152,523
3,973,264
8,747,667
4,621,880 4,621,880
-
65,978 26,031 33,806
-
26,708
152,523
3,973,264
- 3,973,264
8,747,667 4,687,858 26,031 33,806 3,999,972
-
-
-
- 82 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
27.
Financial instruments (Continued)
30 June 2019
Weighted
average
interest
rate
%
Carrying
amount
Contractual
cash flows
6 mths or
less
6-12
mths
1-2 years
2-5
years
$
$
$
$
$
$
Trade and other
payables
Lease liabilities
Loan
7.58
12
1,715,618
200,379
3,960,846
5,876,843
1,715,618 1,715,618
-
57,379 44,894
-
41,391 56,715
200,379
3,960,846
-
5,876,543 1,772,997 44,894 4,002,237 56,715
- 3,960,846
-
-
Market risk
Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and
equity prices will affect the Group’s income or the value of its holdings of financial instruments. The
objective of market risk management is to manage and control market risk exposures within
acceptable parameters, while optimising the return.
Currency risk
The Group is exposed to currency risk on investments and purchases that are denominated in a
currency (Thai baht) other than the respective functional currencies of Group entities, which is
primarily the Australian dollar.
As at the statement of financial position date the Group holds the following financial assets or
liabilities which are exposed to foreign currency risk.
Other current assets
Cash and cash equivalents
Sensitivity analysis
Carrying amount
2020
$
117,830
202,266
2019
$
77,035
285,298
The Group is exposed to fluctuations in foreign currencies arising from the acquisition of services from
time to time in currencies other than the Group’s functional currency. A change of 10% in the foreign
currency exchange rate at 30 June 2020 would have increased equity by $32,009 (2019: $36,233), an
equal change in the opposite direction would have decreased equity by an equal but opposite amount.
Interest rate risk
The Group is exposed to interest rate risk (primarily on its cash and cash equivalents), which is the risk
that a financial instrument’s value will fluctuate as a result of changes in the market interest rates on
interest-bearing financial instruments. The Group does not use derivatives to mitigate these
exposures. The Group is not exposed to cash flow volatility from interest rate changes on borrowings
as the finance leases carry fixed rates of interest.
The Group adopts a policy of ensuring that as far as possible it maintains excess cash and cash
equivalents in short terms deposit at interest rates maturing over 90 day rolling periods or less.
- 83 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
27.
Financial instruments (Continued)
Profile
At the reporting date the interest rate profile of the Group’s and the Company’s interest-bearing
financial instruments was:
Fixed rate instruments
Cash and cash equivalents
Lease liabilities
Loan
Variable rate instruments
Cash and cash equivalents
Cash backed performance bonds
Carrying amount
2020
$
2019
$
50,000
152,523
3,973,264
4,175,787
1,747,098
32,615
1,779,713
50,000
200,379
3,960,846
4,211,225
851,148
31,872
883,020
Fair value sensitivity analysis for fixed rate instruments
The Group does not account for any fixed rate financial assets and liabilities at fair value through profit
or loss, Therefore a change in interest rates at the reporting date would not affect profit or loss.
Cash flow sensitivity analysis for variable rate instruments
A change of 100 basis points in interest rates at the reporting date would have increased (decreased)
equity and profit or loss by the amounts shown below. This analysis assumes that all other variables,
in particular foreign currency rates, remain constant. The analysis is performed on the same basis as
2019.
Profit or loss
100bp
increase
$
100bp
decrease
$
Equity
100bp
increase
$
100bp
decrease
$
17,797
(17,797)
17,797
(17,797)
8,830
(8,830)
8,830
(8,830)
30 June 2020
Variable rate instruments
30 June 2019
Variable rate instruments
Fair values
Fair values versus carrying amounts
The carrying amounts of financial assets and liabilities approximate fair value. The basis for
determining fair values versus carrying value of financial instruments not carried at fair value is
described below.
(i)
Other receivables, trade and other payables:
Other receivables, trade and other payables are short term in nature. As a result, the carrying
amount of these instruments is considered to approximate its fair value.
Deposits held on tenement applications:
The deposits held with Thai authorities are fully recoverable (previously 75% of their value)
should the applications not be granted. As a result the carrying amount is considered to
approximate its fair value.
(ii)
- 84 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
27.
Financial instruments (Continued)
Equity Price Risk
Other Equity price risk is the risk that the value of the instrument will fluctuate as a result of changes
in market prices (other than those arising from interest rate risk or currency risk), whether caused by
factors specific to an individual investment, its issuer or all factors affecting all instruments traded in
the market.
Investments are managed on an individual basis and material buy and sell decisions are approved by
the Board of Directors. The primary goal of the Group’s investment strategy is to maximise investment
returns.
The Group’s investments are solely in equity instruments. These instruments are classified as financial
investments and carried at fair value with fair value changes recognised directly in the profit and loss
account.
The following table details the breakdown of the investment assets and liabilities held by the Group:
Listed equities (Level 1 fair value
hierarchy)
Note
30 June 2020
$
30 June 2019
$
10
351,600
1,110,206
Sensitivity analysis
The Group’s equity investments are listed on the Australian Securities Exchange. A 3% increase in
stock prices at 30 June 2020 would have increased equity by $10,548 (2019: $33,306), an equal change
in the opposite direction would have decreased equity by an equal but opposite amount.
Capital Management
The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a
going concern, so as to maintain a strong capital base sufficient to maintain future exploration and
development of its projects. In order to maintain or adjust the capital structure, the Group may return
capital to shareholders, issue new shares or sell assets to reduce debt. The Group’s focus has been to
raise sufficient funds through equity to fund exploration and evaluation activities and mine
development. The Group monitors also has a debt facility which is not repayable until 31 July 2022.
The Group encourages employees to be shareholders through the Long Term Incentive Plan and the
Executive Share Option Plan.
There were no changes in the Group’s approach to capital management during the year. Risk
management policies and procedures are established with regular monitoring and reporting.
Neither the Company nor any of its subsidiaries are subject to externally imposed capital
requirements.
- 85 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
28.
Share-based payments
Shared based payments expense
Directors and Executives
Employee Share Option Plan
Consultants
Employee Share Option Plan
2020
$
2019
$
297,042
-
44,740
341,782
569,386
313,225
-
882,611
The Group has an Employee Share Option Plan (ESOP) for the granting of options to staff members,
directors and consultants. A new ESOP was approved by shareholders on 28 November 2019 and
adopted. Options issued under the ESOP vest on the grant date.
Other relevant terms and conditions applicable to options granted under the ESOP include:
(a)
(b)
(c)
(d)
(e)
(f)
Options issued pursuant to the plan will generally be issued free of charge.
The exercise price of the options shall be as the Directors in their absolute discretion
determine, provided the exercise price shall not be less than the weighted average of the last
sale price of the Company’s shares on ASX at the close of business on each of the 5 business
days immediately preceding the date on which the Directors resolve to grant the options.
Subject to the above, the options may be exercised at any time prior to the expiration date
from the issue date.
The Directors may limit the total number of options which may be exercised under the plan in
any year.
Options with a common expiry date may have a different exercise price and exercise date.
Options shall lapse upon the earlier of:
(i)
(ii)
The expiry of the exercise period; and
The expiry of three months after the option holder ceases to be an employee by
reason of dismissal, resignation or termination of employment, office or services for
any reason, except the Directors may resolve that the options shall lapse on other
terms they consider appropriate.
(g)
Upon exercise the options will be settled in ordinary shares of Matsa Resources Limited.
- 86 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
28.
Share-based payments (Continued)
(a)
Summary of options issued under the Employee Share Option Plan
The following table summarises the number (No.) and the weighted average exercise price (WAEP) of,
and movements in, share options issued during the year to employees other than to key management
personnel which have been disclosed in the Remuneration Report.
2020
No.
2020
WAEP
$
Outstanding at the beginning
of the year
Granted
Exercised
Expired
Outstanding at year-end
Exercisable at year-end
5,750,000
-
-
(2,900,000)
2,850,000
2,850,000
0.22
-
-
0.25
0.17
0.17
2019
No.
3,675,000
2,450,000
-
(375,000)
5,750,000
5,750,000
2019
WAEP
$
0.25
0.17
-
0.23
0.22
0.22
The outstanding balance as at 30 June 2020 is represented by the following options over ordinary
shares, exercisable upon meeting the above terms and conditions:
2,850,000 options with an exercise price of $0.17 each and with an expiry date of 30 November
2021. All have vested and are exercisable at balance date.
Directors and Executives Options
In addition to the ESOP, the Company has issued options to Directors and Executives from time to
time. The terms and conditions of those options vary between option holders. There were 5,750,000
(2019: 5,750,000) options issued to Directors or Executives during the financial year.
Options issued to the Executive Chairman and the Executive Director and Executives vested
immediately.
Other relevant terms and conditions applicable to options granted as above include:
any Directors or Executives vested options that are unexercised by the anniversary of their grant
date will expire or, if they resigned, in accordance with their specific terms and conditions; and
upon exercise, these options will be settled in ordinary shares of Matsa Resources Limited.
- 87 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
28.
Share-based payments (Continued)
(b) Summary of options issued to Directors and Executives
(i)
The following table illustrates the number (No.) and weighted average exercise prices
(WAEP) of share options issued.
Outstanding at 1 July
Granted during the year
Expired during the year
Outstanding at 30 June
Exercisable at 30 June
2020
No.
12,000,000
5,750,000
(6,250,000)
11,500,000
11,500,000
2020
WAEP
$
0.21
0.175
0.25
0.172
0.172
2019
No.
6,250,000
5,750,000
-
12,000,000
12,000,000
2019
WAEP
$
0.25
0.17
-
0.21
0.21
There were 5,750,000 options issued during the year.
Directors
5,000,000 options over ordinary shares with an exercise price of $0.17 each, exercisable upon
meeting the relevant conditions and until 30 November 2021.
5,750,000 options over ordinary shares with an exercise price of $0.175 each, exercisable upon
meeting the relevant conditions and until 30 November 2022.
Executives
750,000 options over ordinary shares with an exercise price of $0.17 each exercisable upon
meeting the relevant conditions and until 30 November 2021.
(c) Valuation models of options and performance rights issued to Directors and Executives
The fair value of the options is estimated at the date of grant using a Black & Scholes model. The
following table gives the assumptions made in determining the fair value of the options granted in the
year.
Dividend yield (%)
Expected volatility (%)
Risk-free interest rate (%)
Expected life of options (years)
Option exercise price ($)
Share price at grant date ($)
Fair value at grant date (c)
2020
2019
Directors
-
72.67
0.62
3.0
0.175
0.13
5.16
Executives
-
-
-
-
-
-
-
Directors
-
140.56
2.09
3.01
0.17
0.13
9.79
Executives
-
140.56
1.95
2.97
0.17
0.14
10.62
- 88 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
28.
Share-based payments (Continued)
Valuation models of options and performance rights issued to Directors and Executives
(c)
(continued)
The expected life of the options is based on historical data and is not necessarily indicative of exercise
patterns that may occur.
The expected volatility reflects the assumption that the historical volatility is indicative of future
trends, which may also not necessarily be the actual outcome.
Employee Expenses
Share options granted in 2019
- equity settled
Share options granted in 2020
- equity settled
Total expense recognised as employee costs
29. Key management personnel
Consolidated
2020
$
2019
$
-
882,612
297,042
297,042
-
882,612
Details of key management personnel
The directors and other members of key management personnel of the Group during the financial
year were:
Name
Position
Directors
Paul Poli
Frank Sibbel
Andrew Chapman Director, Company Secretary and Chief Financial Officer
Executive Chairman
Non-Executive Director
Executives
David Fielding
Group Exploration Manager
Key management personnel remuneration has been included in the Remuneration Report section of
the Directors’ Report on pages 35 to 42. These transferred disclosures have been audited.
Compensation of Key Management Personnel
Short-term employment benefits
Post-employment benefits
Termination benefits
Share-based payments
2020
$
823,073
60,120
-
297,042
2019
$
863,892
63,384
-
569,386
1,180,235
1,496,662
The compensation disclosed above represents an allocation of the key management personnel’s
estimated compensation from the Group in relation to their services rendered to the Company.
Loans to Key Management Personnel
There were no loans to key management personnel during the current or previous financial year.
- 89 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
29. Key management personnel (Continued)
Other transactions and balances with Key Management Personnel
(a) P Poli and F Sibbel are Directors of Bulletin Resources Limited. The Consolidated Entity has an
agreement with Bulletin to provide accounting, technical and administrative services on an
arms-length basis. In the current year $297,612 has been charged to Bulletin for these services
(2019: $318,153).
At 30 June 2020 there was an outstanding balance of $12,553 (2019: $192,087) for Bulletin.
(b) In July 2019, Matsa announced that it entered into a Sale and Purchase Agreement (SPA) with
its associate Bulletin Resources Limited (“Bulletin”, “BNR”), to dispose of an 80% interest in
the Lake Rebecca gold project, 150km east north-east of Kalgoorlie, Western Australia on the
following basis:
1. A cash payment of $125,000 to Matsa Resources Limited; and
2. A 1% net smelter royalty (NSR) on all minerals.
Bulletin and Matsa entered into a joint venture agreement (80% BNR; 20% MAT) whereby
Bulletin will be responsible for all expenditure on the project and Matsa will be free carried
up to a feasibility study. A formal royalty agreement has also been entered into.
(c) P Poli is a director and controlling shareholder of West-Sure Group Pty Ltd which provides
alarm monitoring services to the Consolidated Entity. In the current year nil has been charged
to the Consolidated Entity for this service (2019: $625).
(d) P Poli is a director and controlling shareholder of West-Sure Group Pty Ltd which the
Consolidated Entity sub-lets storage space from. In the current year $8,195 has been charged
to the Consolidated Entity for this service (2019: $6,372).
At 30 June 2020 there was an outstanding balance of $2,006 (2019: nil) payable to West-Sure.
(e) P Poli is a director and controlling shareholder of WA Fleet Systems Pty Ltd which provided
the Consolidated Entity with hire car services from time to time. In the current year $22,723
has been charged to the Consolidated Entity for this service (2019: $600).
At 30 June 2020 there was an outstanding balance of $5,500 (2019: nil) payable to WA Fleet
Systems.
Individual directors and executives compensation disclosure
Information regarding individual directors and executives compensation and some equity instruments
disclosures as permitted by Corporations Regulation 2M.3.03 is provided in the remuneration report
section of the Directors’ report.
No director has entered into a material contract with the Company or the Group since the end of the
previous financial year and there were no material contracts involving directors’ interests existing at
year-end.
- 90 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2020
30. Related party transactions
Subsidiaries
Interests in subsidiaries are set out in Note 24.
Key management personnel
Disclosures relating to key management personnel are set out in the Remuneration Report and Note
29.
31. Remuneration of auditors
The auditor of Matsa Resources Limited is Nexia Perth Audit Services Pty Ltd (Nexia Perth).
Amounts received or due and receivable by Nexia Perth Audit
Services Pty Ltd for an audit or review of the entity and any other
entity in the consolidated group.
Amounts received or due and receivable by related practices of
Nexia Perth Pty Ltd for:
- tax compliance
32.
Events Subsequent to Balance Date
Consolidated
2020
$
2019
$
60,500
64,000
6,000
66,500
6,000
70,000
On 3 September 2020, Matsa announced that that it had raised $6.6 million via way of a placement of
44 million ordinary fully paid shares at $0.15 each with one free attaching option for every share issued
with an exercise price of $0.30 each and expiring two years from the time of issue.
The impact of the COVID-19 pandemic is ongoing and it is not practicable to estimate the possible
impact, positive or negative, after the reporting date. Outcomes can change rapidly and is dependent
on measures imposed by the Australian Government and other countries, such as social distancing
requirements, quarantine, travel restrictions and any economic stimulus that may be provided.
Other than the above, there has been no matter or circumstance that has arisen that has significantly
affected, or may significantly affect:
•
•
•
the group’s operations in future financial years, or
the results of those operations in future financial years, or
the group’s state of affairs in future financial years.
- 91 -
MATSA RESOURCES LIMITED
DIRECTORS DECLARATION
1.
In the opinion of the directors of Matsa Resources Limited (the “Company”):
(a)
the consolidated financial statements and notes are in accordance with the Corporations
Act 2001, including:
(i) giving a true and fair view of the Consolidated Entity’s financial position as at 30 June
2020 and of its performance, for the financial year ended on that date; and
(b)
(c)
(ii) complying with Australian Accounting Standards and Corporations Regulations 2001;
the financial report also complies with International Financial Reporting Standards as
disclosed in note 2(b);
the remuneration disclosures that are contained in page 35 to 42 of the Remuneration
Report in the Directors’ Report comply with the Corporations Act and Australian
Accounting Standard AASB 124 Related Party Disclosures and
(d)
there are reasonable grounds to believe that the Company will be able to pay its debts as
and when they become due and payable.
2.
The directors have been given the declarations required by Section 295A of the Corporations
Act 2001 from the chief executive officer and chief financial officer for the financial year ended
30 June 2020.
Signed in accordance with a resolution of the directors;
Paul Poli
Executive Chairman
Perth, 30 September 2020
- 92 -
Independent Auditor’s Report to the Members of Matsa Resources Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Matsa Resources Limited (the Company and its subsidiaries (the
Group)), which comprises the consolidated statement of financial position as at 30 June 2020, the
consolidated statement of comprehensive income, the consolidated statement of changes in equity and
the consolidated statement of cash flows for the year then ended, and notes to the financial statements,
including a summary of significant accounting policies, and the directors’ declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations
Act 2001, including:
(i) giving a true and fair view of the Group’s financial position as at 30 June 2020 and of its financial
performance for the year then ended; and
(ii) complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the “Auditor’s responsibilities for the audit of the financial
report” section of our report. We are independent of the Group in accordance with the auditor
independence requirements of the Corporations Act 2001 and the ethical requirements of the
Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional
Accountants (including Independence Standards) (the Code) that are relevant to our audit of the
financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with
the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has been
given to the directors of the Company, would be in the same terms if given to the directors as at the
time of this auditor’s report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in
our audit of the financial report of the current period. These matters were addressed in the context of
our audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide
a separate opinion on these matters. For each matter below, our description of how our audit addressed
the matter is provided in that context.
- 93 -
Key audit matter
Funding and Liquidity
Refer to Note 2ae (Financial Position)
Matsa Resources Limited and its subsidiaries are gold
and base metals exploration companies focusing on
opportunities in Western Australia and Thailand.
The exploration and development activities of the
Group have not yet advanced to a stage where it is
able to generate sufficient revenue to fund its
operational costs, accordingly the Group is reliant on
funding from external sources such as capital
raisings and borrowings to support its operations.
We focussed on whether the Group had sufficient
cash resources and access to funding to allow the
Group to continue as a going concern.
The adequacy of funding and liquidity as well as the
relevant impact on the going concern assessment is
a key audit matter due to the inherent uncertainties
associated with the future development of the
Group’s projects and the level of funding required to
support that development.
How our audit addressed the key audit
matter
We evaluated the Group’s funding and liquidity
position at 30 June 2020 and its ability to fund its
existing liabilities and future expenditure for a
minimum of 12 months from the date of signing
the financial report. In doing so, we performed the
following:
obtained management’s cash flow forecast for
the 15 months for the period July 2020 to
the
checked
September
mathematical accuracy of the forecast;
2021
and
assessed the reliability and completeness of
management’s assumptions by comparing the
forecast cash flows to those of the current year
and as well as our understanding of future
events and conditions; and
considered events subsequent to year end to
determine whether any additional facts or
information have become available since the
date on which management made
its
assessment.
Other information
The directors are responsible for the other information. The other information comprises the information
included in the Group’s annual report for the year ended 30 June 2020, but does not include the financial
report and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not
express any form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.
Directors’ responsibility for the financial report
The directors of the Company are responsible for the preparation of the consolidated 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 consolidated financial report, the directors are responsible for assessing the ability of
the Group to continue as a going concern, disclosing, as applicable, matters related to going concern
and using the going concern basis of accounting unless the directors either intend to liquidate the Group
or to cease operations, or has no realistic alternative but to do so.
- 94 -
Auditor’s responsibility for the audit of the financial report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes
our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit
conducted in accordance with the Australian Auditing Standards will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material
if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of this financial report.
A further description of our responsibilities for the audit of the financial report is located at the Australian
Auditing
at: www.auasb.gov.au/auditors_
Standards
responsibilities/ar2.pdf .This description forms part of our auditor’s report.
Board website
Assurance
and
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.
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 35 to 42 of the Directors’ Report for the
year ended 30 June 2020.
In our opinion, the Remuneration Report of Matsa Resources Limited., for the year ended 30 June
2020, complies with Section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the Remuneration
Report in accordance with Section 300A of the Corporations Act 2001. Our responsibility is to express
an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian
Auditing Standards.
Nexia Perth Audit Services Pty Ltd
PTC Klopper
Director
Perth
30 September 2020
- 95 -
MATSA RESOURCES LIMITED
ASX ADDITIONAL INFORMATION
The following additional information is required by the Australian Securities Exchange Ltd in respect
of listed public companies only.
SHAREHOLDING
Distribution of Shareholders as at 18 September 2020
Category (size of holding)
Number of
Shareholders
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 – and over
94
202
252
749
323
1,620
The number of shareholdings held in less than marketable parcels is 161.
Twenty Largest Shareholders as at 18 September 2020
Name
No.
%
JP Morgan Nominees Australia Pty Limited
BNP Paribas Nominees Pty Ltd
Sparta AG
HF Resources Pty Ltd
Mr Paul Poli
RASL AU LLC
HSBC Custody Nominees (Australia) Limited
CS Third Nominees Pty Limited
Mr Paul Poli & Mrs Sonya Kathleen Poli
L & S Davies Pty Ltd
Mr Oliver Nikolovski & Mrs Suzanne Karine Nikolovski
Mr Oliver Nikolovski
Highlands Investments Holdings Pty Ltd
First Trustee Company (NZ) Limited
Mr Robert Paul Martin & Mrs Susan Pamela Martin
Citicorp Nominees Pty Ltd
Delphi Unternehmensberatung Aktiengesellschaft
Dinwoodie Investments Pty Ltd
Mr Kimberley Alan Harris
Mr John Francis Young & Mr Christopher John Young & Mr Brett
William Young
37,609,518
32,301,620
19,120,656
12,947,000
9,369,000
4,620,000
4,023,778
3,916,667
2,586,000
2,255,887
2,250,000
2,050,000
2,000,000
1,750,000
1,675,000
1,601,986
1,530,000
1,511,008
1,472,572
13.87
11.91
7.05
4.78
3.46
1.70
1.48
1.44
0.95
0.83
0.83
0.76
0.74
0.64
0.62
0.59
0.56
0.56
0.54
1,389,000
145,979,692
0.51
53.82
- 96 -
MATSA RESOURCES LIMITED
ASX ADDITIONAL INFORMATION
Substantial Shareholders
Ordinary shareholder
Sparta AG
Number
21,700,146
Percentage
8.00%
Fully paid
RESTRICTED SECURITIES
The Company has no restricted securities on issue.
STATEMENT OF UNQUOTED SECURITIES
Number of Options
2,850,000
5,000,000
11,000,000
1,000,000
5,750,000
Number of Holders
12
3
110
1
3
Exercise Price
$0.17
$0.17
$0.25
$0.35
$0.175
Date of Expiry
30 November 2021
30 November 2021
31 May 2021
30 November 2022
30 November 2022
- 97 -
MATSA RESOURCES LIMITED
ASX ADDITIONAL INFORMATION
TABLE OF MINERAL RESOURCES AND MINERAL RESERVES AT 30 JUNE 2020
Mineral Resource Estimates – Consolidated Summary & Annual Comparison
Project
Resource Category
Tonnes
Au (g/t)
30 June 2019
Fortitude
Red October
Mining Depletion
Fortitude
Red October
Resource Adjustments
Fortitude
Red October
30 June 2020
Fortitude
Red October
Total
Indicated
Inferred
Indicated
Inferred
N/A
Indicated
Inferred
Indicated
Inferred
Indicated
Inferred
Indicated
Inferred
Indicated
Inferred
Metal
(Au oz)
173,300
169,300
49,000
50,000
441,600
-
(1,199)
(1,327)
(2,526)
-
-
-
-
2,945,000
2,503,000
340,000
106,000
5,894,000
-
(16,094)
(7,146)
(23,240)
-
-
-
-
1.8
2.1
4.5
14.7
-
2.3
5.78
-
-
-
-
(182,270)
(12,566)
2,945,000
2,503,000
323,906
98,854
5,870,760
1.8
2.1
4.6
15.3
173,300
169,300
47,801
48,673
439,074
Resource Statement Notes
• The geographic region for Gold Mineral Resources is Australia.
• Figures have been rounded in compliance with the JORC Code (2012). Rounding errors may
cause a column to not add up precisely. Resources exclude recoveries.
- 98 -
MATSA RESOURCES LIMITED
ASX ADDITIONAL INFORMATION
TABLE OF MINERAL RESOURCES AND MINERAL RESERVES AT 30 JUNE 2020 (continued)
Ore Reserve Estimates – Consolidated Summary & Annual Comparison
(The Ore Reserve estimates are a subset of the Mineral Resource estimates)
Project
Reserve Category
Tonnes
Au (g/t)
30 June 2019
Fortitude
Mining Depletion
Reserve Adjustments
Probable
N/A
-
-
-
-
-
-
Fortitude
Probable
1,029,000
1.8
1,029,000
30 June 2020
Fortitude
Total
Reserve Statement Notes
Probable
1,029,000
1.8
1,029,000
Metal
(Au oz)
-
-
-
58,100
58,100
58,100
58,100
• Figures are rounded to reflect appropriate levels of confidence. Apparent differences may
occur due to rounding.
• Fortitude probable reserve determined upon results of mining studies conducted
• The geographic region for Gold Mineral Resources is Australia.
Summary of Governance Arrangements and Internal Controls
The Mineral Resource and Reserve estimates are carried out in accordance with the JORC 2012 Code,
using industry standard techniques and internal guidelines for the estimation and reporting of Ore
Reserves and Mineral Resources. The Mineral Resource and Reserve are estimated by suitably qualified
employees of Matsa Resources Limited, and verified by external consultants (CSA Global Pty Ltd). The
consultants have also carried out reviews of the quality and suitability of the data underlying the
estimate.
Competent Persons Statement
Red October
The information in the report to which this statement is attached that relates to Exploration Results
and Mineral Resources related to the Red October Resource Estimate is based upon information
compiled by Mr Daniel Howe, a Competent Person who is a member of the Australian Institute of
Mining and Metallurgy and the Australian Institute of Geoscientists. Daniel Howe is a full-time
employee of Saracen Mineral Holdings Limited. Daniel Howe has sufficient experience that is relevant
to the style of mineralisation and type of deposit under consideration and the activity being undertaken
to qualify as a Competent Person as defined in the 2012 Edition of the “Australian Code for Reporting
of Exploration Results, Mineral Resources and Ore Reserves”. Daniel Howe consents to the inclusion in
the report of matters based on his information in the form and context in which it appears.
- 99 -
MATSA RESOURCES LIMITED
ASX ADDITIONAL INFORMATION
Fortitude
The information in this report that relates to Mineral Resources has been compiled by Matthew Cobb,
who is a full-time employee of CSA Global Pty Ltd, and Richard Breyley who is a full time employee of
Matsa Resources Limited. Dr Cobb is a Member of both the Australian Institute of Geoscientists and
the Australian Institute of Mining and Metallurgy. Mr Breyley is a member of the Australian Institute
of Mining and Metallurgy. Both Dr Cobb and Mr Breyley have sufficient experience relevant to the style
of mineralisation and type of deposit under consideration and to the activities which they are
undertaking to qualify as a Competent Persons as defined in the JORC Code (2012). Dr Cobb and Mr
Breyley consent to the disclosure of this information in this report in the form and context in which it
appears.
The information in this report that relates to Ore Reserve results is based on information compiled by
Mr Frank Sibbel, who is a Fellow of the Australasian Institute of Mining and Metallurgy. Mr Sibbel is a
non-executive director of Matsa Resources Limited. Mr Sibbel has sufficient experience which is
relevant to the style of mineralisation and the type of ore deposit under consideration and 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
Sibbel consents to the inclusion in the report of the matters based on his information in the form and
context in which it appears.
- 100 -
MATSA RESOURCES LIMITED
SCHEDULE OF MINING TENEMENTS
Tenement Type
and No.
Project
Holder
Status
Symons Hill
Matsa Resources Limited
Symons Hill
Matsa Resources Limited
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Lake Carey
Matsa Gold Pty Ltd
E 69/3070
E 28/2916
E 38/2945
E 39/1752
E 39/1770
E 39/17961
E 39/1803
E 39/1812
E 39/1819
E 39/1834
E 39/1837
E 39/1840
E 39/1863
E 39/1864
E 39/18892
E 39/1957
E 39/1958
E 39/1980
E 39/1981
E 39/2015
L 39/247
L 39/260
L 39/267
L 39/291
M 39/1
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
M 39/1065
Lake Carey
M 39/1089
Lake Carey
M 39/286
M 39/709
M 39/710
P 39/5293
P 39/5652
P 39/5694
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
- 101 -
Share
Held
100%
100%
100%
100%
100%
90%
100%
100%
100%
100%
100%
100%
100%
100%
90%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Tenement Type
and No.
P 39/5669
P 39/5670
P 39/5841
Project
Lake Carey
Lake Carey
Lake Carey
E 28/26002
Lake Rebecca
E 28/26352
Lake Rebecca
MATSA RESOURCES LIMITED
SCHEDULE OF MINING TENEMENTS
Holder
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Devon
Devon
Devon
Devon
Devon
Devon
Devon
Devon
Devon
Devon
Devon
Devon
Devon
Paraburdoo
Matsa Resources Limited
Glenburg
Glenburg
Red Dog
Red Dog
Red Dog
Red Dog
Cundeelee Pty Ltd
Cundeelee Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Red October
Red October Gold Pty Ltd
Red October
Red October Gold Pty Ltd
Red October
Red October Gold Pty Ltd
Red October
Red October Gold Pty Ltd
Red October
Red October Gold Pty Ltd
Red October
Red October Gold Pty Ltd
Red October
Red October Gold Pty Ltd
Red October
Red October Gold Pty Ltd
- 102 -
Status
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Live
Share
Held
100%
100%
100%
20%
20%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
E 39/1760
E 39/1232
L 39/222
L 39/235
L 39/237
M 39/386
M 39/387
M 39/500
M 39/629
M 39/1077
M 39/1078
P 39/6116
P 39/6117
E 47/3518
E 09/2162
E 52/3339
L 39/268
M 39/1099
M 39/1100
M 39/38
L 39/273
M 39/411
M 39/412
M 39/413
M 39/599
M 39/600
M 39/609
M 39/610
MATSA RESOURCES LIMITED
SCHEDULE OF MINING TENEMENTS
Tenement Type
and No.
M 39/611
M 39/721
Project
Holder
Red October
Red October Gold Pty Ltd
Red October
Red October Gold Pty Ltd
SPL 80/2558
Siam Project3
Siam Copper Resources
Co., Ltd
Status
Live
Live
Live
Share
Held
100%
100%
100%
1= 90% held by Matsa
2= 20% held by Matsa
3= Located in Thailand
- 103 -
- 104 -
Executive Chairman
Director
Director
DIRECTORY
Directors
Paul Poli
Franciscus (Frank) Sibbel
Andrew Chapman
Company Secretary
Andrew Chapman
Registered Office
Suite 11,
139 Newcastle Street
PERTH WA 6000
Tel: (08) 9230 3555
Fax: (08) 9227 0370
Email: reception@matsa.com.au
Postal Address
PO BOX 376
Northbridge W.A. 6865
Website
www.matsa.com.au
Share Registry
Advanced Share Registry Services
110 Stirling Highway
Nedlands WA 6009
Tel: (08) 9389 8033
Fax: (08) 9262 3723
Home Stock Exchange
Australian Securities Exchange Ltd
Level 40, Central Park
152-158 St George’s Terrace
Perth WA 6000
ASX Code: MAT
Auditors
Nexia Perth Audit Services Pty Ltd
Level 3
88 William Street
PERTH WA 6000
M
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E
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2
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