ANNUAL
REPORT
2023
Executive Chairman
Director
Director
DIRECTORY
Directors
Paul Poli
Pascal Blampain
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
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
2023 ANNUAL REPORT · PAGE 2
CORPORATE DIRECTORY
CHAIRMAN’S REPORT
OPERATIONS REVIEW
DIRECTORS’ REPORT
AUDITOR’S INDEPENDENCE DECLARATION
FINANCIAL STATEMENTS
-
-
-
-
-
-
Consolidated Statement of Profit or Loss
Consolidated Statement of 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
47
48
49
50
51
52
53
97
98
101
106
MATSA RESOURCES LIMITED - CHAIRMAN’S REPORT
2023 ANNUAL REPORT · PAGE 3
Dear Shareholder,
During the year Matsa, continued its focus on building its asset base that in time can create future
value for shareholders. To that end, Matsa has worked hard on two fronts, increasing the value of its
Lake Carey Gold Project and building a significant ground holding in Thailand which is considered a new
frontier and highly prospective for lithium.
Successful drilling programs at Fortitude North earlier this year, significantly expanded the mineralised
footprint of that prospect to in excess of 1.7km in length and 250m across strike. Such were the results
at Fortitude North, that similarities to the nearby Sunrise Dam Gold Mine were identified providing
strong encouragement for a future resource.
In November 2022, Matsa finalised a formal binding profit-sharing joint venture with Linden Gold
Alliance Limited on the Devon Pit. This followed the collapse of the $20M Sale and Purchase Agreement
with Linden whereby Linden was to acquire the Red October and Devon projects from Matsa for a
mixture of cash and shares and subject to a successful IPO listing. While the joint venture is not without
its problems, Linden did advance the Devon Pit through an updated Scoping Study. While Linden have
been notified of certain defaults with respect to Linden meeting expected outcomes as required under
the joint venture, both parties are working towards a mutually beneficial outcome in this regard.
During the year, Matsa increased its resource at Lake Carey to 936,000oz @ 2.5g/t following new
modelling at Red October. Subsequent to the end of the financial year, Matsa entered in to an agreement
with AngloGold Ashanti whereby AngloGold have been granted a 3-month exclusive period to conduct
due diligence on Matsa’s Red October and wider Lake Carey Gold Project. This could lead to a potential
transaction between the parties although I stress, that there is no guarantee that this will occur. What
it does signify, is there is real value in the Lake Carey Gold Project that is yet to be recognised outside
the Company.
Matsa continued to build on its identification of a number of highly prospective areas in Thailand
for lithium. Matsa has some 1,684km² in applications lodged with the Thai Department of Primary
Industries and Mining with certain applications expected to be granted in the near term. In particular,
Matsa has discovered six separate lithium bearing outcropping pegmatite occurrences that form the
basis of future drilling plans once the grants have been obtained.
Such has been the interest in these applications that lithium metallurgical samples were taken to China
earlier this year and illustrated the potential of a high-grade product with recoveries of up to 97%
using Yongxing Special Materials Co., Ltd’s commercial processing facilities in China. Yongxing are a
lithium carbonate producer in China using lepidolite ore. The samples provided by Matsa to Yongxing
illustrated the quality of the lepidolite product that could exist within Matsa’s Thai applications. There
is a considerable story to play out here.
The Company continues to focus on a “work smarter” discipline which identified opportunities that
in time, I believe will create value and deliver results for all stakeholders. These are not without their
challenges but discipline and patience are key to producing results from all the effort being put in.
I would like to thank all those involved with Matsa for their hard work and support throughout the year.
In particular, I would also like to thank my fellow board members, senior management and the team both
in Perth and Thailand.
PAUL POLI
EXECUTIVE CHAIRMAN
MATSA RESOURCES LIMITED CHAIRMAN’S REPORT -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 “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 and 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 EXECUTIVE CHAIRMAN MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2023 ANNUAL REPORT · PAGE 4
SUMMARY – DELIVERING STRATEGY AND GROWTH
This year, Matsa Resources Limited (‘Matsa’ or ‘the Company’ or ‘the Group’) continued to focus on
the significant resource potential at the Lake Carey Gold Project (‘Lake Carey’, refer Figure 1) and has
set about building a clear pathway to establishing a sustainable long term gold inventory, mining and
processing business, centred at Lake Carey.
The focus of all exploration efforts at Lake Carey during 2023 has been on the Fortitude Fault trend,
where Matsa has demonstrated an economic mining opportunity at the Fortitude Gold Mine.
Additionally, situated only 6km north of the Fortitude Gold Mine, the Fortitude North prospect
continues to demonstrate real potential to deliver a significant resource through future drilling, and is
expected to complement the 489koz resource modelled at the Fortitude Gold Mine.
Elsewhere, the Company has made significant inroads in establishing a robust lithium exploration
project in the western granite belt of western Thailand, with the discovery of five drill ready outcropping
lithium pegmatite occurrences. The discoveries have resulted in the Company progressing select
tenements through the grant process to enable drilling operations to commence upon approval from
regulatory authorities.
Matsa recognised early the importance of establishing credibility for lithium micas as an important
and economically competitive ore source, for the extraction of lithium and its potential for lithium
carbonate production. To that end, the lithium minerals lepidolite and polylithionite of western Thailand
were tested early in 2023 with the potential for a high grade lithium product, returning up to 97%
lithium recoveries was demonstrated using commercial processing technology readily accessible in
southern China. This is a very important and exciting result and substantiates Matsa’s strategic move
into lithium exploration in Thailand.
On the development front, through its joint venture partner Linden Gold Alliance Limited (“Linden”),
the Company is advancing the Devon Pit Gold Mine through regulatory approvals and feasibility
studies with a view to commencing open pit mining mid 2024 that will provide the Company with a
revenue stream from production.
As a result, a number of important and positive outcomes have been achieved over the past 12
months whose highlights include:
• Mineral resources at Lake Carey increased to 936,000oz @ 2.5 g/t Au following model updates
for the Costello lode at Red October
• A scoping study for the Devon Pit demonstrated positive cash flow with all applications for
permitting having been lodged
• Drilling at Fortitude North has extended the footprint of the prospect to 1.7km strike and
approximately 250m across strike. The drilling also returned exceptional widths providing strong
encouragement that further drilling could lead to defining of a resource to compliment the
nearby Fortitude Gold Mine
• Lithium micas lepidolite and polylithionite, from Matsa’s western Thailand projects, demonstrated
superb recoveries of up to 97% and 86% respectively using available commercial processing
facilities in southern China
• Exploration applications lodged and accepted by Thailand’s Department of Mineral Resources
now total 1,684km2 of tenure in Thailand’s western granite belt where the Company has
identified a number of walk up drill targets for lithium exploration
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2023 ANNUAL REPORT · PAGE 5
• Progressing select tenements through regulatory approvals to permit drilling operations to
commence and provide maiden drilling into the Company’s identified lithium bearing pegmatites
in western Thailand
•
In addition to newly discovered outcropping lithium bearing pegmatites, additional drill targets
have been identified from results of ground magnetic and radiometric surveys at Kanchanaburi
and Phang Nga
• Sampling and assay of 625 regional rock chip, soil and stream sediment samples across Matsa’s
regional WA tenements for gold, lithium and REEs.
All set for soil sampling in regional Western Australia – March 2023
Matsa’s key asset is its 100%-owned Lake Carey Gold Project, located approximately 40km south
of Laverton and approximately 250km north-northeast of Kalgoorlie in Western Australia (Figure 1).
The project is situated in the heart of an active gold mining district that hosts several multi-million-
ounce gold mines including Wallaby and Sunrise Dam with Northern Star’s Carouse Dam located a
little further south.
Lake Carey comprises of almost 450km2 of highly prospective tenements within the Laverton Tectonic
Zone (LTZ) of the Kurnalpi Terrane in Western Australia’s eastern goldfields region. The district is
well serviced by infrastructure including a network of high-quality roads, gas pipelines, communication
infrastructure, airstrips with regular services to Perth and close proximity to an established mining
workforce and supply network.
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2023 ANNUAL REPORT · PAGE 6
Matsa also holds a number of rapidly developing lithium and copper assets in Thailand with 1,684km2
under Special Prospecting Licence Applications (SPLA) for lithium and tin in Thailand’s western granite
belt, and a further 584km2 under SPLA for copper, silver, gold and base metals in central Thailand’s
Loei Fold Belt.
FIGURE 1: Matsa’s projects with a gold focus at Lake Carey in Western Australia and lithium –
tin focus in western Thailand
Exploration has continued at both Lake Carey and Thailand during the July 2022 to June 2023
reporting periods.
Matsa has additional gold and copper exploration projects in Western Australia’s Pilbara (refer
Company website https://www.matsa.com.au/projects/ for further information).
REVIEW OF OPERATIONS
AUSTRALIAN OPERATIONS
LAKE CAREY
The Lake Carey Gold Project (Figure 2), located in the Laverton Tectonic Zone in the heart of the
Eastern Goldfields of Western Australia’s Yilgarn province (Figure 3), is bookended to the north by
world class mines such as Granny Smith, Sunrise Dam and Wallaby, to the west Butchers Well and to
the south Northern Star’s Deep South mine. The eastern margin of the tenement package is bounded
by the regional Barnicoat East Fault structure that separates the Kurnalpi and Burtville terranes.
Importantly, from a development perspective the key resource projects are located within granted
mining licences and accessible by a network of established haul roads. As such, all of the key projects
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2023 ANNUAL REPORT · PAGE 7
have a shorter lead time to obtaining final mining approvals than would normally be encountered at
the exploration and assessment phase.
Project status for key resource and mining options are outlined in the following table:
PROJECT
Fortitude Stage 2
Gallant
Bindah
Red October*
Devon Pit*
Hill East*
Olympic*
MINING LEASE
HAUL ROADS
MINE PROPOSAL
Granted
Granted
Granted
Granted
Granted
No
Granted
Existing
Existing
Existing
Existing
Existing
Partial
Existing
Current
Required
Required
Current
Required
Required
Required
TABLE 1: Key resources and mining lease status, new changes are marked in blue
* The Devon Pit Gold Mine is subject to a profit share joint venture agreement with Linden Gold Alliance
Ltd where studies are being completed and contemplates a restart of open pit mining operations.
OVERVIEW
The bulk of exploration work during this financial year has been focussed on Fortitude North and
the Devon Pit at Lake Carey. Exploration activities this year included reverse circulation drilling (RC),
diamond drilling (DD) and evaluation studies.
Summary of drilling:
DRILLING TYPE
Reverse Circulation
Diamond Core
Total
NO. HOLES
METERS
41
8
49
5,186
839
6,025
Key results from this work include:
TABLE 2: Summary of drilling
• An updated study for the Devon Pit Gold Mine demonstrated A$50,000,000 positive cash
flowmining 250kt @ 5.15g/t for approximately 40,000oz mined
• Diamond drilling (DD) and reverse circulation (RC) drilling at the Devon Pit resulting in a updated
resource model of 69koz (up from 65koz) and provision of core for metallurgical studies
• Progression of relevant studies to finalise a definitive feasibility study
• Applications for permitting to commence mining at the Devon Pit Gold Mine
• Reverse circulation drilling at Fortitude North extended the footprint of known mineralisation
to 1.7km strike length and 250m across strike with ‘economic’ type intercepts recorded
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2023 ANNUAL REPORT · PAGE 8
FIGURE 2: Lake Carey Gold Project
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2023 ANNUAL REPORT · PAGE 9
Matsa’s Red October camp looking southeast with Lake Carey backdrop
Geologist in action logging RC chips at Fortitude North in May 2023
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2023 ANNUAL REPORT · PAGE 10
FIGURE 3: Regional Geological Setting and location of the Lake Carey project
RESOURCES
The gold resource at Lake Carey grew to 936koz (30 June 2023, Table 3) through the following
additions and mining adjustments (Figure 4):
• Minor increase of 5koz at Devon Pit Gold Mine following modelling of new drilling
•
Increase of 45koz at Red October following modelling of the Costello lode (inclusion of
development and drilling results)
• No mining has taken place during the reporting period with Red October placed on a care and
maintenance program in July 2021.
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2023 ANNUAL REPORT · PAGE 11
Cutoff
Measured
Indicated
Inferred
Total Resources
g/t Au (‘000t) g/t AU (‘000t) g/t AU (‘000t) g/t AU (‘000t)
g/t AU (‘000) oz)
Red October
Red October UG
Red October Subtotal
Devon
Devon Pit (OP)
Olympic (OP)
Hill East (OP)
Devon Subtotal
Fortitude
Fortitude
Gallant (OP)
Bindah (OP)
2.0
1.0
1.0
1.0
1.0
1.0
1.0
105
105
8.4
8.4
608
608
5.4
5.4
18
4.4
434
4.6
-
-
-
-
-
-
-
-
-
-
434
4.6
635
635
16
171
748
935
127
2.2
2,979
-
-
-
-
-
43
1.9
-
3.3
2.0
4,943
341
483
5,767
Fortitude Subtotal
127
2.2
3021
Stockpiles
TOTAL
-
232
-
5.0
-
-
191
4063
2.7
7,337
5.4
5.4
6.0
2.8
2.0
2.2
1.9
2.1
2.3
1.9
1.0
2.2
1348
1348
467
171
748
1386
8,048
341
526
8,915
191
11,840
5.6
5.6
4.6
2.8
2.0
3.0
1.9
2.1
2.4
1.9
1.0
2.5
244
244
69
15
48
132
489
23
40
553
6
936
TABLE 3: Lake Carey Gold Resource Table (resources include reserves, refer Resources and
Reserves table for formal 30 June statement). Note rounding adjustments may not total.
New
drilling
New drilling
(HE)
updated
JORC
compliance
(Gallant)
updated
JORC
compliance
(Gallant)
New
drilling
New drilling
Modelling
revision after
trial mining,
inclusion of
new lodes
New
drilling
New drilling
(RO and
Devon) and
development
(RO)
FIGURE 4: Lake Carey Mineral Resource growth since 2020 Annual Report
EXPLORATION AND GROWTH
Exploration highlights at Lake Carey for the year include:
• 41 RC holes completed at Devon Pit (15), New Years Gift (6) and Fortitude North (20) for
atotal of 5,186m
• 8 diamond core holes for 839m completed at Devon Pit for metallurgical testwork
• Modelling of the Costello lode at Red October produced a maiden resource of 45koz for the
Costello lode increasing the Red October Resource to 244koz (@ 5.6g/t Au)
• An updated MRE for Devon Pit increasing the resource from 65koz to 69koz
• Progressing studies and permitting with a view to developing the Devon Pit Gold Mine
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2023 ANNUAL REPORT · PAGE 12
Drone view of drilling Fortitude North (looking north)
DRILLING
All drilling activities during the year were undertaken at the Company’s flagship project, the Lake Carey
Gold Project.
Reverse circulation drilling at Fortitude North (Figure 5) comprising 20 holes were completed for
3,747m with results surpassing previous drilling in both volume of mineralisation and average intercept
grades. The results also established that the system has not been closed off along strike as previously
thought, and that further drilling is warranted. The Fortitude North prospect has now been defined
over a strike length of 1.7km and further drilling is contemplated during the FY24 calendar, aiming to
model a maiden resource.
An additional six holes for 264m of reverse circulation drilling was undertaken at New Years Gift where
the Company has defined a narrow quartz lode with patchy high grade shoots. The proximity of this
prospect to the Devon Pit could provide mining synergies.
At the Devon Pit diamond drilling (8 holes for 839m) and reverse circulation drilling (15 holes for
1,175m) was completed during the year. These work programs were undertaken as part of a definitive
feasibility study into the recommencement of mining at the Devon Pit.
FORTITUDE NORTH DRILLING SUMMARY
During the year, drilling recommenced at Fortitude North where 20 RC holes for 3,747m were completed.
The drilling has now extended the Fortitude North discovery by 200m to the north resulting in a
strike extent of 1.7km which remains open in both directions along strike. In addition, the drilling has
extended mineralisation down dip to the east by 70m for a total width of some 250m across strike.
The new 2023 drilling has added significantly to the potential size and scale of Fortitude North.
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2023 ANNUAL REPORT · PAGE 13
FIGURE 5: Fortitude North Drilling Summary
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2023 ANNUAL REPORT · PAGE 14
All drilling results are presented on long section (Figure 6) that highlights interpreted high grade shoot
geometry. Drill hole section 6762840N (Figure 7) displays the recent results from holes 23FNRC015
and 23FNRC016 extending the known mineralisation approximately 70 metres towards the east with
improved grades and thicknesses.
Of particular note is the substantial volume increase in mineralisation now wireframed (Figure 6) when
comparing the 2021 Fortitude North exploration model (blue shape) and the model update following
new drilling results (red shapes). It is evident there are multiple lode structures and potential brittle
offsets within Fortitude North.
Diamond drilling is planned to obtain important structural information as well as test for extensions
to these thick lode intercepts. The drilling will also test conclusions from 3D Magnetic Inversion
modelling, that hypothesises a key magnetic unit associated with gold mineralisation and apparent NE
structural controls that are discordant to the dominant regional NNW trending magnetic feature. The
key observation here is that much of the past drilling has been oriented from NE to SW which may
have been ineffective due to the drilling being parallel to potential NE trending structure.
FIGURE 6: Longitudinal projection of Fortitude North with new drilling showing interpreted
highgrade plunging shoots
DEVON PIT DRILLING SUMMARY
The Devon Pit (Figure 8) drill program comprised 15 RC holes for 1,175m. The drilling was designed to
target both the Main and Western lodes within the current optimised pit shell at the Devon Pit (Figure
9) and the results validate the gross architecture and lode interpretation of the Devon Pit resource
previously completed by Matsa and reported in April 2021.
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2023 ANNUAL REPORT · PAGE 15
FIGURE 7: Interpreted drill section at 6762840N showing the best mineralisation is open at
depth, note volume change between blue shape (old model) and new drilling results (red shapes)
The Devon JV is a 50/50 split Profit Share Joint Venture between Matsa and Linden Gold Alliance
Limited (“Linden”) with Linden being appointed the joint venture manager. Under the terms of the
Devon JV, Matsa is free carried on a non-recourse basis for all costs associated with permitting,
financing, development and mining of the Devon Pit with Linden required to meet certain milestones.
FIGURE 8: Devon Open Pit, oblique view looking along strike to northeast
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2023 ANNUAL REPORT · PAGE 16
FIGURE 9: Long Section of Devon Pit (looking east) showing location of new drilling
STUDIES
During the year, studies into the potential to recommence mining at the Devon Pit were initiated. In
addition, a Mining Proposal (under a small operations plan) to haul and process stockpiled ore from
the Bindah Pit was approved by DMIRS.
Historically, Devon Pit ore had been successfully processed through two different processing plants
(Darlot, Red 5 and Carosue Dam, Northern Star) during the GME mining operation in 2015 and 2016
respectively.
A total of 60,622t at 5.31g/t for 10,349oz was processed through the plants for an average recovery
of 92.69%. The material comprised mostly oxide and transitional, with fresh forming part of the
campaign in the later stages.
Underground mining took place during the early part of the 20th Century and whilst the historical
production numbers look healthy, it is difficult to obtain accurate total production due to the patchy
nature of the available data.
Studies have commenced to obtain approvals for a restart of the Devon Pit with the following
permitting applications lodged:
•
Mining Proposal
• Mine Closure Plan
• Works Approval
• Clearing Permit Application
• Abstraction licence
Final statutory approvals are expected by June 2024. A conceptual site layout plan (Figure 10) for the
Devon Pit Gold Mine is shown below:
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2023 ANNUAL REPORT · PAGE 17
FIGURE 10: Proposed mine layout for Devon Pit Gold Mine drilling
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2023 ANNUAL REPORT · PAGE 18
Exploration activities at Lake Carey for the coming year will include:
• Finalise definitive feasibility studies (DFS) for the Devon Pit Gold Mine and subject to a positive
outcome, approve a development proposal (decision to mine)
• Obtain regulatory approvals to put the Devon Pit Gold Mine into production
• Drilling at Fortitude North with the aim of delivering a maiden resource to complement the nearby
Fortitude Gold Mine
• Drilling at advanced exploration projects including FF1, Carmen, Stealth and Mirage
• Drill testing of newly discovered gold in basement anomalies at Wilga West and Phantom Well
• Additional regional geophysical coverage to assist exploration drilling
• Ongoing regional soil coverage
Bindah Pit looking NW towards Gallant along the Bindah Shear structure
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2023 ANNUAL REPORT · PAGE 19
THAILAND OPERATIONS
Matsa has made substantial progress on lithium exploration and potential development in Thailand
with the discovery of five new outcropping lithium bearing pegmatite fields and establishing early
in the exploration stage, that the lepidolite and polylithionite lithium micas can be processed using
current commercially operating processing plants to extract lithium and produce battery grade lithium
carbonate.
Matsa is progressing 6 tenements at Kanchanaburi, Ratchaburi and Phang Nga, through the granting
process that will provide regulatory approvals to conduct exploration drilling. Once drilling is permitted,
and subject to the rainy season, Matsa is hopeful that resource drilling will rapidly advance.
During the period, Matsa has applied for additional tenements that cover the highly prospective
western granite belt and the Company now holds 1,684km2 in Special Prospecting Lease Applications
(SPLAs) (Figure 11). Matsa arguably holds access to one of the largest lithium hard rock exploration
plays in south-east Asia.
Soil, stream and rock chip sampling amounted to 553 samples (Table 4) across the project area.
Customs, logistics and third-party reliability to process these samples for assaying has been a
challenge and as a result the Company has since set up an in-house sample preparation facility at
Kanchanaburi to dry, crush and pulverise samples that takes out the longer lead time activities in the
sample preparation and assay process flow. The samples are then sent to Australia for assaying at one
of the commercial laboratories in Perth.
SAMPLE TYPE
QUANTITY
Rock Chips
Stream Sediment
Soil
Total
159
340
54
553
TABLE 4: Table of sampling for Matsa’s lithium exploration in western Thailand.
All samples undergo multielement assaying for lithium, tin, rubidium and other rare earth pegmatite
associated elements. A total of 514 samples are awaiting assay with 273 samples currently at ALS
(Perth) and a further 241 samples ready for dispatch.
Ground geophysical surveys were undertaken at Kanchanaburi and Phang Nga where radiometric
surveys were successful in defining potential drill targets in both areas. The magnetic survey results
were less conclusive with coincident radiometric and magnetic signatures identified at Phang Nga,
reaffirming potential drill targets, but at Kanchanaburi no coincident magnetic and radiometric
responses were observed.
EXPLORATION AND GROWTH
LITHIUM EXPLORATION AND LITHIUM MICA PROCESSING
Matsa has identified widespread lithium anomalism at Phang Nga, Ratchaburi and Kanchanaburi
resulting in the discovery of five outcropping lithium bearing pegmatites that are ready for drill testing.
The five outcropping lithium bearing pegmatites, 3 at Kanchanaburi, 1 at Ratchaburi and 1 at Phang
Nga, are closely associated with the regionally extensive western granite belt (Figure 12) and host
lepidolite and polylithionite lithium micas. It is noted that both of these lithium minerals do not occur
within the same pegmatite units.
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2023 ANNUAL REPORT · PAGE 20
FIGURE 11: Plan of Matsa’s Thailand lithium/tin projects
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2023 ANNUAL REPORT · PAGE 21
FIGURE 12: Western Thailand’s granite and major regional fault setting with Matsa lithium
discoveries (colour coded pink for lepidolite and brown for polylithionite bearing pegmatites)
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2023 ANNUAL REPORT · PAGE 22
Early during the discovery phase of exploration, Matsa recognised the need to establish that lepidolite
and polylithionite lithium micas can be readily and commercially processed to extract lithium and that
these lithium micas could present as an economic alternative to the spodumene market. As such, in
March 2023, four 25kg samples were collected for testwork. These samples comprised both lepidolite
and polylithionite lithium micas from Matsa’s Phang Nga, Ratchaburi and Kanchanaburi project areas.
In April 2023, Matsa received confirmation from Yongxing Special Materials Co. Ltd (Yongxing)
that both lepidolite and polylithionite ores could be processed for lithium extraction using current
commercial processing facilities. In addition, the lepidolite samples presented to Yongxing were of
sufficient grade to constitute a DSO (direct shipping ore) product. Final lithium recoveries of up to
97% present an excellent outcome and establishes the viability of both lepidolite and polylithionite as
raw materials for the production of battery grade lithium carbonate.
Pink Panther lithium bearing pegmatite outcrop at Kanchanaburi
LITHIUM RECOVERY AND TESTWORK
During the year, Matsa released initial metallurgical testwork results1 for flotation and recovery of
lithium from lithium mica ores using representative samples from the Pink Panther, Black Panther,
Spotted Panther and Rose Panther prospects (Table 5). The testwork was conducted by Yongxing at
their lepidolite mining and processing operations in southern China, which has been producing high
quality lithium carbonate from lepidolite since 2019. Yongxing claim an Li2CO3 (lithium carbonate)
purity of 99.81% from its lepidolite mining and processing operation in Jiangxi.
There are four producers in Jiangxi province produce lithium from lepidolite: Yongxing Material, Jiangte
Motor, Nanshi Lithium and Feiyu New Energy. A variety of technologies are used, primarily at the
roasting stage. These are being continually advanced in an effort to reduce production costs and
increase extraction efficiency2.
Yongxing’s Jiangxi processing plant has been processing 1.2Mtpa of locally sourced lepidolite ore
running at 0.6% lithium oxide and for the 2022 calendar year, generated sales of A$3.26B and a net
profit of A$1.33B.
1 ASX Announcement 4 April 2023 – Positive Lepidolite Processing Test Results Thailand Lithium
2 11 March 2022, CRU International Limited https://www.crugroup.com/knowledge-andinsights/
insights/2022/scrutinising-the-lithium-technology-boom-part-3/
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2023 ANNUAL REPORT · PAGE 23
The Matsa testwork was conducted on four separate composites, using standard flotation, sulphate
roast and leaching for lithium extraction. Two lepidolite and two polylithionite ore types were tested.
Both lepidolite samples were also tested for DSO potential.
SAMPLE
SAMPLE
GRADE LI2O (%) LEACHING RATE (%) COMMENTARY
GRADE LI2O (%) LEACHING RATE (%) COMMENTARY
O Pink Panther DSO
O Pink Panther DSO
S
S
D
D
Rose Panther DSO
Rose Panther DSO
e Pink Panther concentrate
e Pink Panther concentrate
t
t
a
a
r
r
t
t
n
n
e
e
c
c
n
n
o
o
C
C
Black Panther concentrate
Black Panther concentrate
Spotted Panther concentrate
Spotted Panther concentrate
Rose Panther concentrate
Rose Panther concentrate
1.65%
1.65%
2.44%
2.44%
4.04%
4.04%
0.68%
0.68%
2.06%
2.06%
5.91%
5.91%
94.50%
94.50%
91.06%
91.06%
94.78%
94.78%
55.30%
55.30%
85.64%
85.64%
97.32%
97.32%
Rosting is feasible (lepidolite ore)
Rosting is feasible (lepidolite ore)
Rosting is feasible (lepidolite ore)
Rosting is feasible (lepidolite ore)
Rosting is feasible (lepidolite ore)
Rosting is feasible (lepidolite ore)
The raw material lithium oxide is too low (polylithionite ore)
The raw material lithium oxide is too low (polylithionite ore)
Rosting is feasible (polylithionite ore)
Rosting is feasible (polylithionite ore)
Rosting is feasible (lepidolite ore)
Rosting is feasible (lepidolite ore)
TABLE 5: Table of lithium recovery from testwork on Pink Panther & Rose Panther, Black
Panther and Spotted Panther samples from western Thailand.
Key points regarding the testwork include:
• Pink Panther “mined grade” of 1.65% Li2O produced a concentrate grading 4.04% Li2O (via
flotation)
• Rose Panther “mined grade” of 2.44% Li2O produced a concentrate grading 5.91% Li2O (via
flotation) which compares favourably to typical commercial spodumene concentrates
• Spotted Panther returned favourable extraction rates (86%) considering the chemistry and
processing reagent ratios were not adjusted for the slight difference in chemical composition of
polylithionite, which contains sodium, compared to lepidolite for which the processing facility is
tuned
China is currently the only jurisdiction in the world to process lepidolite for lithium carbonate
production. During the past five years, China has managed to master the technological requirements
to process lepidolite at competitive production costs. In addition, environmental issues associated with
processing lithium micas have been largely remedied. Lepidolite processing flowchart is shown (Figure
13) below:
Simplified Lepidolite Processing Flowchart
Lepidolite
Crushing
Additions
Mixing
Roasting
Water
Leaching
Filtration
Solution
Residue
FIGURE 13: Processing flow chart for extraction of lithium from lepidolite (lithium micas)
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2023 ANNUAL REPORT · PAGE 24
CHEMISTRY OF LITHIUM MICAS
The chemical composition3 of spodumene, lepidolite and polylithionite is shown (Figure 14) below:
SPODUMENE (LITHIUM PROXENE)
LEPIDOLITE (LITHIUM MICA)
POLYLITHIONITE (LITHIUM MICA)
Potassium
10.07%
K
12.13% K2O
Potassium
9.95%
K
Lithim
3.73% Li
Aluminium
14.50% Al
Silicon
30.18% Si
8.03% Li2O
27.40% Al2O3
64.58% SiO2
Lithim
3.58% Li
Aluminium
6.95% Al
Silicon
28.93% Si
Hydrogen
0.26% H
7.70% Li2O
.13% Al2O3
61.89% SiO2
2.32% H2O
Sodium
Lithim
1.75% Na
3.00% Li
Aluminium
6.86% Al
Silicon
28.58% Si
Hydrogen
0.26% H
11.98% K2O
2.36% Na2O
6.46% Li2O
12.97% Al2O3
61.14% SiO2
2.29% H2O
Oxygen
51.59% O
Oxygen
Fluorine
51.59% O
4.89%
F
4.89%
F
Oxygen
Fluorine
44.77% O
4.83%
F
4.83%
F
-2.06% -O=F2
-2.03% -O=F2
TOTAL
100%
100%
TOTAL
100%
100%
TOTAL
100%
100%
FIGURE 14: General chemistry of key lithium mineral species
Technical specifications of both lepidolite and polylithionite indicate that flotation can successfully
produce concentrates of 6% Li2O, which is comparable to the typical market specifications for
spodumene concentrates. The results of Yongxing’s testwork on Matsa’s samples confirm the technical
capacity of producing a high spec concentrate from lithium mica, which demonstrated a concentrate
of 5.9% (~6%) Li2O for the Rose Panther lepidolite sample.
The testwork results provide Matsa with a high level of confidence that commercially viable lithium
development in western Thailand can be achieved with further work.
Yongxing display (right to left) of lepidolite concentrate and lithium products derived from
lepidolite processing
3 Source: https://www.webmineral.com/chem/Chem-Li.shtml
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2023 ANNUAL REPORT · PAGE 25
Photo Set: Matsa testwork flotation concentrate samples from left to right and top to bottom;
lepidolite concentrate from Pink Panther, polylithionite concentrate from Black Panther, polylithionite
concentrate from Spotted Panther & lepidolite concentrate from Rose Panther
LITHIUM RECOVERY AND TESTWORK
A total of 61.57 line km ground magnetic and radiometric surveys, at 25m line spacing, was undertaken
across three key project areas including Pink, Rose and Hidden Panther prospects.
The surveys were undertaken to assist exploration targeting in areas of limited outcrop. Where outcrop
does exist, the results of the surveys demonstrated good correlation between known lithium occurrences
and strong radiometric responses, particularly in potassic counts (cK).
A number of targets have been interpreted from both the magnetic and radiometric surveys that will be
drill tested following field inspection. Should drilling confirm these targets contain lithium mineralisation,
further surveys will be conducted in other parts of the project area where outcrop is limited.
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2023 ANNUAL REPORT · PAGE 26
Pink Panther (Kanchanaburi) sampling for Yongxing’s metallurgical testwork
Stream sediment sampling at Chumphon next to a palm oil plantation
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2023 ANNUAL REPORT · PAGE 27
Sampling lithium bearing (lepidolite- pink colours) pegmatite outcrop in western Thailand
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2023 ANNUAL REPORT · PAGE 28
NEXT STEPS
Work at Matsa’s Thailand projects for the coming year will include:
• Progress applications for grant of Special Prospecting Leases (“SPL”) that will enable Matsa to
conduct drilling operations at Phang Nga, Ratchaburi and Kanchanaburi
• Conduct drilling to define lateral extent of lithium pegmatites at Pink Panther and Rose Panther
once SPL has been granted
• Conduct ground truthing field trips to assess the quality of targets generated from ground
magnetic and radiometric surveys and drill test
• Undertake additional ground geophysical surveys in other parts of the project area to generate
further drill targets
• Continue regional assessment through stream sediment and soil sampling programs
• Further petrographic and ME analysis of regional lithium bearing rocks to improve geological
understanding of mineralisation models to assist exploration
Conducting ground magnetic and radiometric surveys at Kanchanaburi in western
Thailand
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2023 ANNUAL REPORT · PAGE 29
CORPORATE ACTIVITIES
LINDEN PROFIT SHARING JOINT VENTURE AGREEMENT
On 7 October 2022, Matsa announced that that it had executed a non-binding indicative term sheet
with Linden whereby Matsa and Linden form an equal 50/50 development and profit sharing joint
venture to advance the Devon Pit to a feasibility study and subsequently into production and that
Linden had paid a $100,000 deposit.
On 11 November 2022, a formal binding profit-sharing joint venture agreement (“JVA”) with Linden was
executed.
On 23 December 2022, Matsa announced that it received $3,900,000 from Linden as required under
the profit-sharing JVA between Matsa and Linden in relation to the Devon Pit and that settlement of
the transaction had been achieved.
The key terms of the JVA are as follows:
• Linden will be granted a 50% profit-share interest in the Devon Pit and be appointed JV Manager
• Matsa is not obligated to repay the $4,000,000 upfront non-recourse prepayment and Linden
can only recoup that prepayment from profits generated by the Devon Pit
• Matsa will be free carried by Linden and fund Matsa’s share of feasibility, development, finance,
working capital and all other mining costs, with Matsa’s share of these costs only recouped from
the Devon Pit’s profits (“Carried Costs”). Furthermore, under the terms of the free carry, Matsa
is not responsible for any losses
• Matsa is entitled to 50% of the profit once the $4,000,000 and free-Carried Costs have been
repaid to Linden
• Linden is required to deliver certain development milestones:
(i) Non-binding commitment from a toll mill or ore purchaser by 31 March 2023
(ii) Delivery of an approved Definitive Feasibility Study by 31 August 2023
(iii) Proof of funding by 30 September 2023
(iv) Commencement of mining before 30 June 2024
•
If milestones 1, 3 and 4 are not met, Matsa has the right to terminate the JVA (except in
certain extension scenarios including suppressed gold prices, government permitting/approvals
and other items outside Linden’s control)
• A JV committee will be formed with two representatives each from Linden and Matsa
As part of the settlement of the JVA the existing Sale and Purchase Agreement between Matsa and
Linden in respect of Red October and Devon Pit and any subsequent amendments were terminated.
OTHER ACTIVITIES
On 2 December 2022, Matsa announced that it had extended the term of its existing $4,000,000
borrowing facility to 30 November 2025, on the same terms and conditions as the previous $4,000,000
facility which was due to be repaid on 30 November 2022.
MATSA RESOURCES LIMITED - OPERATIONS REVIEW
2023 ANNUAL REPORT · PAGE 30
Matsa executed new loan agreements with its existing two independent lenders who have each
provided a $2,000,000 facility. The key terms and conditions of the loans are as follows:
Amount:
$4,000,000
Term:
3 years, repayable by 30 November 2025
Interest Rate:
12% pa payable monthly in arrears
Security:
Charge over all property of the Company by way of a general security
agreement and a mortgage over the Fortitude Gold Project tenements
Fee:
Issue of 150,000 fully paid Matsa ordinary shares to the lenders at the
commencement date and each anniversary date of the loan advance while it
remains outstanding.
On 28 June 2023, Matsa entered into a short-term loan agreement with one of its existing lenders for
an additional $750,000 loan facility. As at 30 June 2023, $500,000 was drawn down from the facility.
The $750,000 short-term loan facility is repayable by 30 September 2023.
All other terms and conditions are standard for a transaction of this nature and remain the same to
the terms and conditions of the existing loan.
MATSA RESOURCES LIMITED
DIRECTORS’ REPORT
Your directors present their report for the year ended 30 June 2023.
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 the entire year unless otherwise stated.
Names, qualifications, experience and special responsibilities
Mr Paul Poli Bachelor of Commerce, FCPA DFP (Executive Chairman)
Mr Poli is a fellow of the Australian Society of Certified Practicing Accountants and a former registered
Securities Trader. He was the founder and managing partner of a taxation and business advisory firm
for 19 years prior to founding and heading Matsa Resources Limited from 2009 to date. He is well
versed in all aspects of business, particularly financial management through both his previous
consulting roles and through his personal ownership of private companies in Western Australia, the
Northern Territory and South East Asia. Mr Poli led the negotiations for several significant transactions
for Matsa including the $14,000,000 Norseman sale to Panoramic Resources Limited, $6,000,000
minority interest sale to Westgold Resources Limited, and $7,000,000 Symons Hill IGO joint venture.
Mr Poli, in his capacity as Chairman of Bulletin Resources also negotiated the sale of Halls Creek gold
project for $12,000,000 to Pantoro Limited, and the $5.7M Apollo transaction.
He has been chairman of Matsa for over 13 years and a significant investor in the mining industry. Mr
Poli is particularly well qualified to drive the creation of a significant 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 Pascal Blampain BSc, MAusIMM, MAIG
Pascal Blampain is a geologist with over 28 years’ experience across Australia and Papua New Guinea
having held senior positions with global miners including Barrick Gold Corporation and Gold Fields
Limited.
Mr Blampain’s roles have spanned regional and near-mine exploration, operational geology, long-
term strategic planning and resource development. He has a strong track record of delivering resource
and reserve growth in gold during his time working at world-class deposits such as Plutonic, Wallaby
(Granny Smith), Porgera (PNG) and Lawlers (now Lawlers-Agnew).
Mr Blampain has also served as Chief Geologist/Geology Manager roles at Plutonic (Superior Gold
Inc.), Mount Monger-Mt Belches (Silver Lake Resources Limited), Darlot (Gold Fields Limited) and
Lawlers (Barrick Gold Corporation).
Mr Blampain has not served as a Director of any other publicly listed companies during the past three
years.
Mr Andrew Chapman CA F Fin GAICD
Mr Chapman is a chartered accountant with over 31 years’ experience in publicly listed companies in
the mineral resources, oil and gas and technology sectors.
He has held Board positions as well as other senior roles including Director, Company Secretary and
Chief Financial Officer. Mr Chapman has significant experience in the areas of corporate acquisitions,
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MATSA RESOURCES LIMITED
DIRECTORS’ REPORT
divestments and capital raisings. He has developed specialist knowledge of dealing with ASX and other
corporate regulatory bodies, financial institutions and other advisory groups.
Mr Chapman is an associate member of the Chartered Accountants Australia and New Zealand
(CAANZ), a Fellow of the Financial Services Institute of Australasia (Finsia) and a graduate of the
Australian Institute of Company Directors (AICD).
Mr Chapman has not served as a Director of any other publicly listed companies during the past three
years.
Mr Franciscus (Frank) Sibbel B.E.(Hons) Mining, F.Aus.IMM (resigned 3 March 2023)
Mr Sibbel is a mining engineer who has in excess of 40 years operational and managerial experience,
in both small and large scale mining projects from development through to successful production.
Since 2008, he has been a mining consult where he has successfully consulted on numerous projects
for a diversified range of mining companies throughout Australia and overseas.
Mr Sibbel’s vast experience in development of gold projects from the grass roots will ensure the
company has the extensive skills to deliver on its strategy.
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; resigned 1 September 2021)
COMPANY SECRETARY
Mr Chapman is also the Company Secretary of Matsa. Refer to the directors’ particulars as noted
above.
PRINCIPAL ACTIVITIES
During the year the principal activities of entities within the Group were gold and other mineral
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 $818,647 (2022: $6,028,025).
The Group’s net loss for the year includes the following items:
Income of $4,000,000 in relation to a non-refundable prepayment for a 50% profit share in
the Devon Pit from Linden (2022: $3,000,000 in non-refundable deposit received in relation
to the sale of the Red October and Devon under the terms of the JVA).
A loss of sale of tenements of $nil (2022: $2,353,509).
Capitalised exploration and evaluation assets of $322,419 (2022: 1,028,175) written
off/impaired.
Share based payments expense of $104,060 (2022: $5,329).
Income of $95,774 (2022: $86,079) relating to Research and Development tax refunds for
eligible research.
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MATSA RESOURCES LIMITED
DIRECTORS’ REPORT
Review of Financial Position
The net assets attributable to the shareholders of the Company have increased by $1,174,905 from
30 June 2022 to $13,720,165 at 30 June 2023.
During the financial year, $1,976,000 (before costs) was raised via the issue of 52,000,000 fully paid
ordinary shares at an issue price of $0.038 each; and
Cash reserves at 30 June 2023 were $794,303 compared to $1,572,483 in the previous financial year.
Going Concern
The consolidated 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 $818,647 (2022: $6,028,025) and a cash outflow from
operating activities of $354,851 (2022: $2,791,531). At the reporting date, the Group had $794,303 in
cash and term deposit balances. The Group also had borrowings of approximately $4,000,000 due and
payable on 30 November 2025 and approximately $500,000 due and payable on 30 September 2023.
These financial statements have been prepared on a going concern basis. In arriving at this position,
the directors have had regard to the fact that based on the matters noted below the Group has, or in
the Directors opinion, will have access to, sufficient cash to fund administrative and other committed
expenditure for a period of at least 12 months from the date of signing this report.
In forming this view the directors have taken into consideration the following:
On 31 July 2023, the Company executed an agreement with AGAA, which provides AGAA an
exclusive three month period to conduct due diligence and to discuss and negotiate a
potential transaction with the Company in respect of the Lake Carey Gold Project. AGAA paid
the Company a lump sum of $500,000 for the maintenance and dewatering costs of Red
October Gold Mine in return for the exclusivity period;
On 28 September 2023, the repayment date of its short term borrowing of $500,000 was
extended for a further three months to 31 December 2023;
The ability of the Group to manage discretionary expenditure in line with the Group’s
cashflow; and
The ability of the Group to obtain additional funding as and when required.
Should the Group not achieve the matters set out above there is significant uncertainty whether the
Group will continue as a going concern and therefore whether it will realise its assets and extinguish
its liabilities in the normal course of business and at the amounts stated in the financial statements.
The financial statements do not include any adjustment relating to the recoverability or classification
of recorded asset amounts or to the amounts or classification of liabilities that might be necessary
should the Group not be able to continue as a going concern and meet its debts as and when they fall
due.
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.
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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 23 employees of which 19 were full-time as at 30 June 2023 (2022: 14 full-time
equivalent employees).
Review of Operations
A full review of the operations of the Group during the year ended 30 June 2023 is included on pages
4 to 30.
SIGNIFICANT CHANGES IN STATE OF AFFAIRS
Significant changes in the state of affairs of the Group that occurred during the financial year are
disclosed in the corporate activities section of the operations review of this report.
SIGNIFICANT EVENTS AFTER THE REPORTING DATE
On 25 July 2023 Matsa announced that Linden was unable to meet Milestone 1 by 31 March 2023 as
well as an extension to meet Milestone 1 by 30 June 2023. In addition, Linden has failed to implement
approved budgets and programmes and failed to provide a 2024 financial year proposed programme
and budget as obligated as the Manager of the joint venture. As a result, Matsa issued a default notice
to Linden.
On 31 July 2023, the Company executed an agreement with AGAA, which provides AGAA an exclusive
three month period to conduct a due diligence and to discuss and negotiate a potential transaction
with the Company in respect of the Lake Carey Gold Project. AGAA paid the Company a lump sum of
$500,000 for the maintenance and dewatering costs of Red October Gold Mine in return for the
exclusivity period.
On 30 August 2023, the Company successfully completed a placement to professional and
sophisticated investors to raise approximately $2,000,000 before costs to advance the Lake Carey
Gold Project and continue building on the lithium prospectivity in Thailand.
On 28 September 2023, the repayment date for the drawn down amount of $500,000 was extended
for a further three months to 31 December 2023.
As required under the terms of the JVA, on 31 August 2023, Linden submitted a Definitive Feasibility
Study in which Matsa considers not in compliant with the requirements of the JVA and deemed not
of suitable standard for financing purposes. As a result, a further Default Notice was issued on 20
September 2023.
LIKELY DEVELOPMENTS AND EXPECTED RESULTS
It is expected that the Group will continue its exploration activities in Australia and Thailand. These
are described in more detail in the Review of Operations on page 4 to 30.
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
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MATSA RESOURCES LIMITED
DIRECTORS’ REPORT
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 (resigned 3 March 2023)
Andrew Chapman
Pascal Blampain
Directors’ Meetings
Number eligible
to attend
7
3
7
7
Number
attended
7
3
7
7
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
$0.09 Unlisted
Options
Number of
$0.17 Unlisted
Options
Paul Poli
Andrew Chapman
Pascal Blampain
13,900,000
600,000
300,000
2,000,000
1,500,000
2,000,000
-
-
1,000,000
Options granted to directors and officers of the Company
During the financial year, the Company granted 6,000,000 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 October 2023
30 November 2023
30 November 2025
30 November 2025
30 November 2025
7 September 2025
$0.21
$0.17
$0.08
$0.09
$0.09
$0.07
2,150,000
1,000,000
15,000,000
6,000,000
3,000,000
31,833,333
58,983,333
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.
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MATSA RESOURCES LIMITED
DIRECTORS’ REPORT
Shares Issued on Exercise of Options
During the financial year 2,750 listed options were exercised with an exercise price of $0.17 each.
During the financial year, the following options were forfeited or lapsed:
1,000,000 with an exercise price of $0.35
5,750,000 with an exercise price of $0.175
1,100,000 with an exercise price of $0.21
2,000,000 with an exercise price of $0.35
2,000,000 with an exercise price of $0.25
44,079,341 with an exercise price of $0.30
28,124,324 with an exercise price of $0.17
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MATSA RESOURCES LIMITED
DIRECTORS’ REPORT
REMUNERATION REPORT - Audited
Principles of Compensation
This remuneration report for the year ended 30 June 2023 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 Company, and includes the four executives in the Company 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 Company 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 KMP Disclosures
Details of KMP of the Company and Group are set out below:
Name
Directors
P Poli
F Sibbel
A Chapman
P Blampain
Executives
D Fielding
Position
Date of
Appointment
Date of
Resignation
Executive Chairman and
Managing Director
Non-Executive Director
Executive Director and Company
Secretary
Executive Director
23 December 2008
-
25 October 2010
3 March 2023
17 December 2009*
17 February 2021
-
-
Group Exploration Manager
12 April 2010
5 December 2022
*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 consolidated financial report was authorised for issue.
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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 KMP.
The Board assesses the appropriateness of the nature and amount of remuneration of KMP 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 KMP 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 KMP;
• attraction of quality management to the Company; and
• performance incentives which allow KMP 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 Non-Executive 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 Non-Executive Directors as agreed. The current
aggregate remuneration is $250,000 per year.
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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
Non-Executive 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 Non-Executive Director on market). It is considered good governance for Non-Executive 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-Executive Directors are
entitled to receive retirement benefits and to participate in any incentive programs. There are
currently no specific incentive programs.
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 2023 and 30 June
2022 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 financial 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. No external advice was received during the
year.
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 years
ended 30 June 2023 and 30 June 2022 is detailed in this report.
- 39 -
MATSA RESOURCES LIMITED
DIRECTORS’ REPORT
REMUNERATION REPORT (continued)
Managing Director and Executive Remuneration Structure
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 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 2023 and 30 June
2022 is detailed in this report.
Variable Remuneration – Short Term Incentive (STI)
The objective of the STI is to provide sufficient incentive to the Executives to achieve their
performance goals. The total potential STI available is set at a level such that the cost to the Group is
reasonable in the circumstances.
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 STI payments available for Executives across the Group is subject to the Board’s
discretion and approval. Payments are usually delivered as a cash bonus. During the year, no STI was
paid or awarded.
Variable Remuneration – Long Term Incentive (LTI)
The objective of the LTI plan is to reward KMP in a manner which aligns the element of remuneration
with the creation of shareholder wealth. As such LTI’s are made to KMP 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 LTIs 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.
During the year, options were granted to Directors with vesting price conditions established in
advance of grant by the Board.
- 40 -
MATSA RESOURCES LIMITED
DIRECTORS’ REPORT
REMUNERATION REPORT (continued)
The Group does have a policy to prohibit executives or directors from entering into arrangements to
protect the value of unvested LTI awards.
Other Benefits
KMP 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
Fixed remuneration and STI is not linked to the financial 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 Long Term Incentive Plan typically has no direct financial performance requirements but
has specified time restrictions on the exercise of options. The granting of options is in substance a
performance incentive which allows executives to share the rewards of the success of the Company.
The options have no vesting conditions and they vest immediately on grant date.
During the year, options were issued to Directors with deemed vesting conditions attached. These
options are therefore linked to the Company’s performance due to vesting conditions being
dependent on the Company’ share price.
Service Agreements
It is the Board’s policy that service contracts are entered into with all KMP 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 Pascal Blampain, Technical Director, has a contract of employment with the Company. Mr
Blampain receives a salary of $275,000 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 David Fielding, Group Exploration Manager, had a contract of employment with the Company. Mr
Fielding received a salary of $241,000 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 Andrew Chapman, Director and Company Secretary, has a contract of employment with the
Company. Mr Chapman 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.
- 41 -
MATSA RESOURCES LIMITED
DIRECTORS’ REPORT
REMUNERATION REPORT (continued)
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
2023
$0.036
2022
$0.043
2021
$0.072
2020
$0.155
2019
$0.145
(818,647)
(6,028,025)
(9,654,713)
(5,235,103)
(4,947,360)
2023
Short Term Benefits
Post-
employment
Benefits
Share-
based
payments
Key Management
Person
Salary &
Fees
$
Other
Superannuation
Options
Total
$
$
$
$
%
Performance
Related
% of
Remuneration
that consists
of securities
Directors
Paul Poli1
Frank Sibbel2
Pascal Blampain4
Andrew Chapman
Total
Executives
David Fielding3
Total
292,327
28,000
272,685
199,234
792,246
94,672
94,672
5,750
-
13,985
-
19,735
-
-
25,468
-
25,468
21,003
71,939
9,941
9,941
22,200
5,550
22,200
16,650
66,600
345,745
33,550
334,338
236,887
950,520
-
-
104,613
104,613
6.42
16.54
6.64
7.03
-
-
-
6.42
16.54
6.64
7.03
-
-
-
1 Mr Poli is a director and shareholder of Strategic Siam Co Ltd which received payments totalling $43,809 during the year. Strategic Siam
provides administration services to Thai entities. Mr Poli receives an internet and travel allowance as part of his terms of employment
(disclosed as other short term benefits).
2 Mr Sibbel resigned on 3 March 2023.
3 Mr Fielding resigned on 5 December 2022.
4 Mr Blampain receives a travel allowance as part of his terms of employment and also received a one-off leave cash-out payment during
the year (disclosed as other short term benefits).
2022
Short Term Benefits
Post-
employment
Benefits
Share-
based
payments
Key Management
Person
Salary &
Fees
$
Directors
Paul Poli1
Frank Sibbel2
Pascal Blampain
Andrew Chapman
Total
328,973
54,320
275,000
200,000
858,293
Other
$
Superannuation
$
Options
$
Total
$
%
Performance
Related
% of
Remuneration
that consists
of securities
3,963
-
-
-
3,963
23,712
-
23,712
20,083
67,507
-
-
5,329
-
5,329
356,648
54,320
304,041
220,083
935,092
-
-
-
-
-
-
-
-
-
-
Executives
David Fielding
Total
1 Mr Poli is a director and shareholder of Strategic Siam Co Ltd which received payments totalling $42,785 during the year. Strategic Siam
provides administration services to Thai entities. Mr Poli receives an internet and travel allowance as part of his terms of employment
(disclosed as other short term benefits).
271,266
271,266
224,933
224,933
22,219
22,219
24,114
24,114
-
-
-
-
-
-
2 Mr Sibbel provided consultancy services to the Company totalling $12,320 during the year.
- 42 -
MATSA RESOURCES LIMITED
DIRECTORS’ REPORT
REMUNERATION REPORT (continued)
Compensation Options Granted and Vested during the year
The table below sets out options granted during the year to KMP. There were 6,000,000 options issued
to Directors during the year. There were no options that were granted in previous years that vested
during the year. The options entitle the holder to subscribe for one fully paid ordinary share in the
Company.
2023
Vested
Granted Grant Date
No.
No.
Spot
price per
Security
at Grant
Date
$
Exercise
Price
First
Exercise
Date
Expiry
Date
$
P Poli
F Sibbel
P Blampain
A Chapman
500,000
2,000,000 2,000,000
500,000
2,000,000 2,000,000
1,500,000 1,500,000
25.11.22
25.11.22
25.11.22
25.11.22
0.04
0.04
0.04
0.04
0.09 30.6.2023 30.11.25
0.09 30.6.2023 30.11.25
0.09 30.6.2023 30.11.25
0.09 30.6.2023 30.11.25
The options carry an exercise price of $0.09 each. The exercise price has been calculated at 145% of
$0.06 which is deemed as the vesting price condition attached to the options, based on a 10-day
trading period above the share price on the date of issue of the options up to the expiry date. The
contractual life of each option is three years and there is no cash settlement of the options.
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.
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
2023
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
Paul Poli
Frank Sibbel
Pascal Blampain
Andrew Chapman
$
22,200
5,550
22,200
16,650
66,600
$
-
-
-
-
-
- 43 -
$
142,064
77,489
-
77,489
297,042
%
6.42
16.54
6.64
7.03
-
MATSA RESOURCES LIMITED
DIRECTORS’ REPORT
REMUNERATION REPORT (continued)
Option holdings of key management personnel
2023
P Poli
A Chapman
F Sibbel
P Blampain
D Fielding
2022
Balance 1
July
No.
Granted as
remune-
ration
No.
3,390,500
1,615,500
1,552,575
1,000,000
742,797
8,301,372
Balance 1
July
No.
2,000,000
1,500,000
500,000
2,000,000
-
6,000,000
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.
-
-
-
-
-
-
(3,390,500)
(1,615,500)
(1,500,000)
-
-
(6,506,000)
-
-
(552,575)
-
(742,797)
(1,295,372)
2,000,000
1,500,000
-
3,000,000
-
6,500,000
-
-
-
-
-
-
2,000,000
1,500,000
-
3,000,000
-
6,500,000
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
P Blampain
D Fielding
5,890,500
2,865,500
2,802,575
-
1,492,797
13,051,372
-
-
-
1,000,000
-
1,000,000
-
-
-
-
-
-
(2,500,000)
(1,250,000)
(1,250,000)
-
(750,000)
(5,750,000)
-
-
-
-
-
-
3,390,500
1,615,500
1,552,575
1,000,000
742,797
8,301,372
3,390,500
1,615,500
1,552,575
1,000,000
742,797
8,301,372
-
-
-
-
-
-
*Net change other refers to expiry of options during the year.
Shareholdings of key management personnel
2023
Balance 1 July
P Poli
A Chapman
F Sibbel
P Blampain
D Fielding
No.
13,900,000
300,000
700,000
300,000
941,522
16,141,522
2022
Balance 1 July
P Poli
A Chapman
F Sibbel
P Blampain
D Fielding
No.
13,650,000
300,000
700,000
-
941,522
15,591,522
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.
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
300,000
500,000
-
-
800,000
-
-
(1,200,000)
-
(941,522)
(2,141,522)
13,900,000
600,000
-
300,000
-
14,800,000
Net change
other**
No.
Balance on
resignation
No.
Balance
30 June
No.
250,000
-
-
300,000
-
550,000
-
-
-
-
-
-
13,900,000
300,000
700,000
300,000
941,522
16,141,522
**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
- 44 -
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.
INDEMNIFYING AUDITORS
The Company has not, during or since the end of the financial year, indemnified or agreed to indemnify
the auditor of the Company against a liability incurred by the auditor in relation to the performance
of the audit. During the financial year, the Company has not paid a premium in respect of a contract
to insure the auditor of the Company or any related entity.
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 Directors are 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 2023:
Taxation services
$16,000
- 45 -
MATSA RESOURCES LIMITED
DIRECTORS’ REPORT
AUDITOR’S INDEPENDENCE DECLARATION
The auditor’s independence declaration for the year ended 30 June 2023 has been received and can
be found on page 47.
Signed in accordance with a resolution of the Board of Directors.
Paul Poli
Executive Chairman
Dated this 29th day of September 2023
- 46 -
To the Board of Directors of Matsa Resources Limited,
Auditor’s Independence Declaration under section 307C of the Corporations Act 2001
As lead auditor for the audit of the financial statements of Matsa Resources Limited for the financial year
ended 30 June 2023, I declare that to the best of my knowledge and belief, there have been no
contraventions of:
(a)
the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
(b)
any applicable code of professional conduct in relation to the audit.
Nexia Perth Audit Services Pty Ltd
PTC Klopper
Director
Perth
29 September 2023
- 47 -
MATSA RESOURCES LIMITED
CONSOLIDATED STATEMENT OF PROFIT OR LOSS FOR THE YEAR ENDED
30 JUNE 2023
Continuing operations
Net loss on sale of tenements
Net gain on sale of fixed assets
Other income
Depreciation expense
Salaries and employment benefits expenses
Exploration and expenditure written-off/provided for
Other administration expenses
Share based payments expense
Results from operating activities
Finance income
Finance costs
Net finance cost
Profit/(loss) before income tax expense
Income tax expense
Profit/(loss) from continuing operations
Discontinued operations
Loss from discontinued operations
Note
2023
$
2022
$
5
5
5
9
5
5
5
5
-
17,273
4,225,212
(102,626)
(1,523,049)
(322,419)
(1,554,604)
(104,060)
635,727
4,681
(514,358)
(509,677)
(2,353,509)
60,000
3,275,060
(103,379)
(1,273,501)
(1,028,175)
(1,670,283)
(5,329)
(3,099,116)
496
(540,148)
(539,652)
126,050
-
(3,638,768)
-
126,050
(3,638,768)
19
(944,697)
(2,389,257)
Net loss for the year
(818,647)
(6,028,025)
The accompanying notes form part of these financial statements.
- 48 -
MATSA RESOURCES LIMITED
CONSOLIDATED STATEMENT OF OTHER COMPREHENSIVE INCOME FOR THE YEAR
ENDED 30 JUNE 2023
Net loss for the year
Other comprehensive income
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
Earnings per share:
Basic/diluted loss per share attributable to ordinary equity
holders of the parent (cents per share)
Earnings per share – continuing operations:
Basic/diluted profit/(loss) per share attributable to ordinary
equity holders of the parent (cents per share)
Note
2023
$
2022
$
(818,647)
(6,028,025)
-
-
(818,647)
(6,028,025)
(819,031)
384
(818,647)
(819,031)
384
(818,647)
(6,028,111)
86
(6,028,025)
(6,028,111)
86
(6,028,025)
18
(0.20)
(1.70)
18
0.03
(1.02)
The accompanying notes form part of these financial statements.
- 49 -
MATSA RESOURCES LIMITED
CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2023
Note
2023
$
2022
$
Current assets
Cash and cash equivalents
Trade and other receivables
Other assets
Assets classified as held for sale
Total current assets
Non-current assets
Other assets
Other receivables
Exploration and evaluation assets
Property, plant and equipment
Right-of-use assets
Total non-current assets
Total assets
Current liabilities
Trade and other payables
Borrowings
Lease liabilities
Provisions
Liabilities associated with assets held for sale
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
22
7
8
19
8
7
9
10
11
12
13
11
14
19
13
11
14
15
16
17
794,303
237,340
146,596
6,565,347
7,743,586
367,363
200,000
14,532,559
296,760
94,651
15,491,333
23,234,919
1,478,057
590,783
64,864
286,630
2,650,832
5,071,166
3,992,621
33,679
417,288
4,443,588
9,514,754
13,720,165
1,572,483
175,469
172,935
9,008,264
10,929,151
287,363
200,000
10,627,811
538,564
61,776
11,715,514
22,644,665
2,694,409
4,118,332
66,360
295,290
2,506,240
9,680,631
-
15,850
402,924
418,774
10,099,405
12,545,260
65,596,745
10,317,900
(62,273,168)
13,641,477
78,688
13,720,165
63,892,578
10,028,515
(61,454,137)
12,466,956
78,304
12,545,260
The accompanying notes form part of these financial statements.
- 50 -
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 30 JUNE 2023
MATSA RESOURCES LIMITED
Balance at 1 July
2021
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
Share based
payment
Balance at 30 June
2022
Balance at 1 July
2022
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
Issue of options
Share based
payment
Balance at 30 June
2023
Issued
Capital
Ordinary
$
Accumulated
Losses
$
Equity
Settled
Benefits
Reserve
$
Total
$
Non-
controlling
interest
$
Total
$
60,696,604
(55,426,026) 10,023,186
15,293,764
78,218 15,371,982
-
(6,028,111)
-
(6,028,111)
3,420,950
(224,976)
-
-
-
-
-
-
-
-
(6,028,111)
86
(6,028,025)
(6,028,111)
86
(6,028,025)
3,420,950
(224,976)
5,329
5,329
-
-
-
3,420,950
(224,976)
5,329
63,892,578
(61,454,137) 10,028,515
12,466,956
78,304 12,545,260
63,892,578
(61,454,137) 10,028,515
12,466,956
78,304 12,545,260
-
-
(819,031)
(819,031)
-
-
(819,031)
384
(818,647)
(819,031)
384
(818,647)
2,016,218
(312,051)
-
-
-
-
-
-
-
-
1,500
2,016,218
(312,051)
1,500
287,885
287,885
-
-
-
-
2,016,218
(312,051)
1,500
287,885
65,596,745
(62,273,168) 10,317,900
13,641,477
78,688 13,720,165
The accompanying notes form part of these financial statements.
- 51 -
MATSA RESOURCES LIMITED
CONSOLIDATED CASH FLOW STATEMENT FOR THE YEAR ENDED 30 JUNE 2023
Note
2023
$
2022
$
Cash flows from operating activities
Other income
Payments to suppliers and employees
Interest received
Net payments to discontinued operations
Net cash used in operating activities
Cash flows from investing activities
Payments for financial assets
Purchase of plant and equipment
Exploration and evaluation assets
Proceeds on sale of plant and equipment
Proceeds on sale of tenements
Net payments to discontinued operations
Net cash used in investing activities
Cash flows from financing activities
Proceeds from issue of shares
Proceeds from issue of options
Costs of issue
Repayment of lease liabilities
Repayment of borrowings
Proceeds from borrowings
Interest paid
Net payments to discontinued operations
Net cash provided by financing activities
Net (decrease)/increase in cash and cash equivalents
Cash and cash equivalents at beginning of financial
year
Cash and cash equivalents at end of financial year
4,291,005
(3,400,483)
4,681
(1,250,054)
(354,851)
(80,000)
(156,340)
(1,571,204)
17,273
-
(259,733)
(2,050,004)
1,976,468
1,500
(128,226)
(89,072)
(4,120,040)
4,500,000
(513,955)
-
1,626,675
3,302,846
(3,063,207)
496
(3,031,666)
(2,791,531)
-
(4,119)
(1,624,031)
35,000
713,636
(80,473)
(959,987)
3,375,350
-
(224,976)
(104,210)
(224,868)
-
(526,092)
(529)
2,294,675
(778,180)
(1,456,843)
1,572,483
794,303
3,029,326
1,572,483
19
22
19
15
15
22
22
22
19
22
The accompanying notes form part of these financial statements.
- 52 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
CORPORATE INFORMATION
1.
The consolidated financial statements of Matsa Resources Limited (the “Company” or “Matsa”) and
its controlled entities (the “Group”) for the year ended 30 June 2023 were authorised for issue in
accordance with a resolution of the Board of Directors on 29 September 2023.
Matsa Resources Limited 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.
2.
SIGNIFICANT ACCOUNTING POLICIES
(a)
Basis of Preparation
The consolidated 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.
The consolidated 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
Since 1 July 2022 the Group has adopted all the Standards and Interpretations mandatory for annual
reporting periods beginning on or after 1 July 2022. The adoption of any new and revised standards
and interpretations effective from 1 July 2022 has not resulted in any changes to the Group’s
accounting policies and has had no material effect on the amounts reported to the current or prior
period. The Group has not elected to early adopt any new standards or interpretations that are not
mandatory effective.
Standards and Interpretations in issue not yet adopted for the year ended 30 June 2023
The directors have also reviewed all Standards and Interpretations in issue not yet adopted for the
year ended 30 June 2023. 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.
- 53 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
2.
SIGNIFICANT ACCOUNTING POLICIES (Continued)
(d)
Basis of consolidation
The consolidated financial statements comprise the financial statements of the Company 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 in control
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 the Company controls
another entity.
The financial statements of the subsidiaries are prepared for the same reporting period as the
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 Group and cease
to be consolidated from the date on which control is transferred out of the Group.
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.
(e) Going Concern
The consolidated 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 $818,647 (2022: $6,028,025) and a cash outflow from
operating activities of $354,851 (2022: $2,791,531). At the reporting date, the Group had $794,303 in
cash and term deposit balances. The Group also had borrowings of approximately $4,000,000 due and
payable on 30 November 2025 and approximately $500,000 due and payable on 30 September 2023.
These financial statements have been prepared on a going concern basis. In arriving at this position,
the directors have had regard to the fact that based on the matters noted below the Group has, or in
the Directors opinion, will have access to, sufficient cash to fund administrative and other committed
expenditure for a period of at least 12 months from the date of signing this report.
In forming this view the directors have taken into consideration the following:
On 31 July 2023, the Company executed an agreement with AGAA, which provides AGAA an
exclusive three month period to conduct a due diligence and to discuss and negotiate a
potential transaction with the Company in respect of the Lake Carey Gold Project. AGAA paid
the Company a lump sum of $500,000 for the maintenance and dewatering costs of Red
October Gold Mine in return for the exclusivity period;
On 28 September 2023, the repayment date of its short term borrowing of $500,000 was
extended for a further three months to 31 December 2023;
The ability of the Group to manage discretionary expenditure in line with the Group’s
cashflow; and
- 54 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
2.
SIGNIFICANT ACCOUNTING POLICIES (Continued)
(e) Going Concern (continued)
The ability of the Group to obtain additional funding as and when required.
Should the Group not achieve the matters set out above there is significant uncertainty whether the
Group will continue as a going concern and therefore whether it will realise its assets and extinguish
its liabilities in the normal course of business and at the amounts stated in the financial statements.
The financial statements do not include any adjustment relating to the recoverability or classification
of recorded asset amounts or to the amounts or classification of liabilities that might be necessary
should the Group not be able to continue as a going concern and meet its debts as and when they fall
due.
(f)
Segment Reporting
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 year to acquire property, plant and
equipment, and intangible assets other than goodwill.
(g)
Business combinations
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.
- 55 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
2.
SIGNIFICANT ACCOUNTING POLICIES (Continued)
(g)
Business combinations (continued)
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 Financial Instruments (‘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 Australian
accounting standard.
(h)
Foreign currency transactions and balances
(i) Functional and presentation currency
The functional currency of each entity within the Group 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 Company’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 reporting 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.
- 56 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
2.
(i)
SIGNIFICANT ACCOUNTING POLICIES (Continued)
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 reporting 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 24.
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 Company’s business model for managing the financial assets and the
contractual terms of the cash flows.
Other
Other non-derivative financial instruments are measured at amortised cost using the effective interest
method.
- 57 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
2.
(j)
SIGNIFICANT ACCOUNTING POLICIES (Continued)
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.
(k)
Impairment of non-financial assets
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.
(l)
Cash and cash equivalents
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.
- 58 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
2.
SIGNIFICANT ACCOUNTING POLICIES (Continued)
(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.
(n)
Interests in Joint Ventures
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.
(o)
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.
- 59 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
2.
(p)
SIGNIFICANT ACCOUNTING POLICIES (Continued)
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 reporting
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.
(q) 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.
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.
- 60 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
2.
(r)
SIGNIFICANT ACCOUNTING POLICIES (Continued)
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.
(s)
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.
(t)
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.
(u)
Borrowing costs
Borrowing costs are recognised as an expense when incurred unless they relate to qualifying assets in
which case they are capitalised.
(v)
Employee benefits
Provision is made for the Company’s liability for employee benefits arising from services rendered by
employees to reporting 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.
- 61 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
2.
SIGNIFICANT ACCOUNTING POLICIES (Continued)
(w) 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.
(x)
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 25.
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).
At each subsequent reporting date until vesting, the cumulative charge to the statement of profit or
loss and other 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 profit or loss and other comprehensive income for the year is the cumulative amount
as calculated above less the amounts already charged in previous years. 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.
- 62 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
2.
(x)
SIGNIFICANT ACCOUNTING POLICIES (Continued)
Share-based payment transactions (continued)
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.
(y)
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 when the rights on receipt of refunds from the Australian Taxation Office for
research and development expenditure incurred is established during the previous financial year.
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.
- 63 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
2.
SIGNIFICANT ACCOUNTING POLICIES (Continued)
(z)
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.
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.
- 64 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
2.
SIGNIFICANT ACCOUNTING POLICIES (Continued)
(aa) 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.
(ab) 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.
(ac) 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.
Divided by the weighted average number of ordinary shares and dilutive potential ordinary shares,
adjusted for any bonus element.
- 65 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
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 25. 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.
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.
- 66 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
3.
SIGNIFICANT ACCOUNTING JUDGEMENTS, ESTIMATES AND ASSUMPTIONS (Continued)
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.
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.
Recovery of deferred tax assets
Deferred tax assets are recognised for deductible temporary differences only if the consolidated entity
considers it is probable that future taxable amounts will be available to utilise those temporary
differences and losses.
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(s). 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.
- 67 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
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 small scale mining and mineral exploration in Western Australia and
Thailand. The Group considers that it operates in two geographical segments but within the same
operating segment. The decision to allocate resources to individual projects is predominantly based
on available cash reserves, technical data and the expectation of future metal prices.
The financial information presented in the statement of profit and loss and other comprehensive
income and statement of financial position is the same as that presented to the chief operating
decision maker. For financial reporting purposes, the Australian and the Thai segments are presented
separately.
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.
- 68 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
4.
SEGMENT REPORTING (Continued)
Information about reportable segments
Information relating to each reportable segment is shown below.
2023
External revenues from continued operations
External revenues from discontinued operations
Segment revenue
Profit/(loss) from continued operations
Loss from discontinued operations
Segment loss before tax
Interest Income
Interest expense
Depreciation expense
Segment assets
Capital expenditure
Segment liabilities
Reportable Segments
Australia
$
Thailand
$
4,242,485
1,116,248
5,358,733
781,169
(944,697)
(163,528)
4,581
(514,358)
(96,909)
-
-
-
(655,119)
-
(655,119)
100
-
(5,717)
Total
$
4,242,485
1,116,248
5,358,733
126,050
(944,697)
(818,647)
4,681
(514,358)
(102,626)
22,676,798
558,121
23,234,919
75,169
81,171
156,340
9,514,633
121
9,514,754
2022
External revenues from continued operations
External revenues from discontinued operations
Segment revenue
3,275,060
871,235
4,146,295
-
-
-
3,275,060
871,235
4,146,295
Loss from continued operations
Loss from discontinued operations
Segment loss before tax
(3,153,701)
(2,389,257)
(5,542,958)
(485,067)
-
(485,067)
(3,638,768)
(2,389,257)
(6,028,025)
Interest Income
Interest expense
Depreciation expense
Segment assets
Capital expenditure
Segment liabilities
126
(540,148)
(103,379)
370
-
-
496
(540,148)
(103,379)
22,174,226
470,439
22,644,665
33,504
-
33,504
10,093,491
5,914
10,099,405
- 69 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
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
Other income
2023
$
2022
$
95,774
4,129,438
4,225,212
86,079
3,188,981
3,275,060
In 2022, the Company received a non-refundable deposit of $3,000,000 in relations to the Red
October and Devon Sale and Purchase Agreement (SPA). Refer note 19 for further details.
On 11 November 2022, the Company executed a formal binding JVA with Linden, in respect of a joint
venture over the Devon Gold Pit. During the period, the Company received an upfront non-refundable
prepayment of $4,000,000 cash from Linden for a 50% profit share in the Devon Pit.
Other key terms of the JVA include;
the Company and Linden will form an unincorporated development and profit-sharing joint
venture (50/50) (JV) which will be responsible for the progression of the development of
the Devon Pit and, in turn, production;
the Company will be free carried by Linden for all costs of development including all
development capital, sustaining capital, attributable debt financing and operating working
capital including completion and closure of mining activities;
Linden will recover all of the Company’s attributed share of costs (including the $4,000,000)
from the Company’s share of proceeds from the sale of its share of production of the JV.
Should the Company’s share of proceeds be insufficient for Linden to recover its costs and
the upfront $4,000,000, the Company will have no liability to pay any outstanding balance;
Linden will be appointed as the manager of the JV and must deliver an acceptable Definitive
Feasibility Study by 31 August 2023 and be able to commence mining by 30 June 2024,
subject to certain conditions. If Linden fails to meet these deadlines the JV terminates and
the $4,000,000 paid to the Company is non-refundable. The Company retains 100%
ownership in the Devon Gold Mine tenements at all times; and
Upon execution of the JVA and the receipt of the $4,000,000, the existing Sale and Purchase
Agreement between the Company and Linden in respect of Red October and Devon (SPA)
and subsequent amendments to that SPA will be terminated. See note 19 for further
details.
- 70 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
5. Income and expenses (Continued)
(b) Finance income
Interest earned
(c) Finance cost
Interest on lease liabilities and borrowings
(d) Expenses included in the statement of comprehensive
income
Depreciation and amortisation expenses
Mine property
Mine capital development
Property plant and equipment
Property plant and equipment held for sale
Right-of-use assets
Disclosure in Statement of Profit and Loss
Continuing operations:
Depreciation expense
Discontinued operations:
Amortisation and depreciation
(e) Other expenses
(i) Employee benefits expense
Salaries and wages (including bonus)
Superannuation expenses
Share based payments
Total employee benefits expense
(ii) Administration and other expenses
Operating lease rentals
Administration expenses
2023
$
2022
$
4,681
496
514,358
540,148
-
-
276,911
127,687
72,529
477,127
102,626
102,626
374,501
374,501
477,127
7,873
184,821
622,182
-
103,261
918,137
103,379
103,379
814,758
814,758
918,137
1,448,730
74,319
104,060
1,627,109
1,201,128
72,373
5,329
1,278,830
6,371
1,548,233
1,554,604
6,371
1,663,912
1,670,283
- 71 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
2023
$
2022
$
-
-
-
-
-
-
6. Income taxes
Income tax expense/(benefit) 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 for the year
(818,647)
(6,028,025)
Income tax expense calculated at 25% (2022: 25%)
(204,662)
(1,507,007)
Non-deductible expenses
Non-assessable income
Effect of temporary differences not recognised in current year
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
32,477
(23,944)
(604,111)
6,574
(21,520)
1,580,278
(78,013)
(56,244)
878,253
-
(2,081)
-
The tax rate used in the above reconciliation is the corporate tax rate of 25% (2022: 25%) 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
2023
$
2022
$
10,919,659
11,262,170
(2,028,174)
211,186
9,352
9,112,023
(2,028,174)
136,402
345,736
9,716,134
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.
As at 30 June 2023, the Company had carried forward revenue losses of $42,747,873 (2022:
$41,535,677). These losses remain available indefinitely for offset against future taxable profits of the
Company provided certain test criteria for their deductibility are met.
- 72 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
7. Trade and other receivables
Current
Amounts receivable from Australian Taxation Authorities
Other receivables
Non-current
Other receivables (i)
2023
$
2022
$
80,580
156,760
237,340
49,476
125,993
175,469
200,000
200,000
200,000
200,000
(i) On 2 February 2021, the Company and Bulletin Resources Limited (Bulletin) have, through their
80:20 joint venture, sold a 400m wide strip (1.35km2) of the 576km2 Lake Rebecca gold project to
Apollo Consolidated Limited (Apollo) for a total consideration of approximately $5,600,000. The
Company’s share of the consideration amount to $1,200,000. The remaining receivable of
$200,000 is expected to be settled in 2025.
8. Other assets
Current
Prepayments
Non-current
Deposits held (i)
Other
2023
$
2022
$
146,596
146,596
287,363
80,000
367,363
172,935
172,935
287,363
-
287,363
(i) 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 the deposits will be refunded in full.
- 73 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
9. 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 (i)
Exploration and evaluation expenditure incurred
Expenditure written off/impaired (ii)
Transfer from/(to) assets held for sale (note 19)
Balance at end of year
2023
$
2022
$
14,532,559
14,532,559
10,627,811
10,627,811
10,627,811
-
-
1,571,204
(322,419)
2,655,963
14,532,559
21,437,966
45,600
(3,068,729)
1,994,430
(1,028,175)
(8,753,281)
10,627,811
(i) On 30 June 2022, IGO Newsearch Pty Ltd (“IGO) acquired a 70% interest in the Symons Hill project
as well as the Company’s other Fraser Range tenements for a cash consideration of $600,000 and
then free carry the Company for all exploration to completion of feasibility studies or decision to
mine whichever occurs earlier. A loss on the sale of $2,209,192 was recognised in the statement
of profit or loss and other comprehensive income.
(ii) During the year, the Company surrendered several tenements and exploration costs of $322,419
previously capitalised for these tenements were written off and recognised in the consolidated
statement of profit or loss and other comprehensive income.
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.
10. Property, plant and equipment
Plant and equipment at cost
Accumulated depreciation
Total property, plant and equipment
2023
$
2022
$
1,883,943
(1,587,183)
296,760
296,760
1,924,483
(1,385,919)
538,564
538,564
- 74 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
10. Property, plant and equipment (Continued)
Movements in carrying amounts
Consolidated
Balance 30 June 2021
Additions
Disposals
Transfer to asset held for sale (note 19)
Depreciation expense
Balance 30 June 2022
Additions
Disposals
Depreciation expense
Balance 30 June 2023
Plant and
Equipment
$
1,917,968
33,504
(535,743)
(254,983)
(622,182)
538,564
156,340
(121,233)
(276,911)
296,760
Total
$
1,917,968
33,504
(535,744)
(254,983)
(622,181)
538,564
156,340
(121,233)
(276,911)
296,760
11. Right-of-use-assets & lease liabilities
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 2023
Reconciliation
As at 1 July 2022
Additions
Disposals
Depreciation expense
As at 30 June 2023
Equipment
$
44,823
(33,617)
11,206
Premises
$
105,404
(21,959)
83,445
Equipment
$
26,147
-
-
(14,941)
11,206
Premises
$
29,040
105,404
-
(50,999)
83,445
Motor
Vehicles
$
119,297
(119,297)
-
Motor
Vehicles
$
6,589
-
-
(6,589)
-
Total
$
306,297
(211,646)
94,651
Total
$
61,776
105,404
-
(72,529)
94,651
- 75 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
11. Right-of-use-assets & lease liabilities (Continued)
Lease liabilities
Set out below are the carrying amounts of lease liabilities.
Carrying Value 2023
Current liabilities
Non-current liabilities
As at 30 June 2023
Carrying Value 2022
Current liabilities
Non-current liabilities
As at 30 June 2022
Equipment
$
12,887
-
12,887
Equipment
$
15,083
15,850
30,933
Premises
$
51,977
33,679
85,656
Premises
$
31,246
-
31,246
Motor
Vehicles
$
-
-
-
Motor
Vehicles
$
20,031
-
20,031
A maturity analysis of future minimum lease payments is presented in Note 24.
Movement for the period
As at 1 July 2022
Additions
Repayments
Interest
As at 30 June 2023
Equipment
$
30,933
-
(18,843)
797
12,887
Premises
$
31,246
105,404
(55,872)
4,878
85,656
Motor
Vehicles
$
20,031
-
(20,533)
502
-
Total
$
64,864
33,679
98,543
Total
$
66,360
15,850
82,210
Total
$
82,210
105,404
(95,248)
6,177
98,543
12.
Trade and other payables
Unsecured liabilities
Trade payables
Sundry creditors and accrued expenses
2023
$
2022
$
935,424
542,633
1,478,057
1,651,509
1,042,900
2,694,409
- 76 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
13. Borrowings
Current
Secured liabilities
- Loan (i)
Unsecured liabilities
- Insurance premium finance
Non-current
Secured liabilities
- Loan (i)
(i) Reconciliation of loan
Balance at beginning of year
Additions
Repayment
Interest capitalised
Balance at end of year
2023
$
2022
$
500,000
3,998,172
90,783
590,783
120,160
4,118,332
3,992,621
3,992,621
-
-
2023
$
3,988,172
4,500,000
(4,000,000)
4,449
4,492,621
2022
$
3,984,116
-
-
14,056
3,998,172
Matsa’s $4,000,000 loan facility was due to be repaid on 30 November 2022. On 1 December 2022,
Matsa executed new loan agreements with its existing independent lenders who have each
provided a $2 million facility. The key terms of the finance facility are as follows:
Principal Amount:
Interest Rate:
Term:
Security:
Fee:
$4,000,000
12% per annum paid monthly in arrears
$4,000,000 repayable by 30 November 2025
The loan facility is secured by a mortgage over the Fortitude gold project
tenements.
Issue of 150,000 fully paid ordinary shares at the commencement date and
each anniversary date of the loan advance while it remains outstanding.
A Facility Fee of 150,000 shares was issued to the lenders on or about 9 December 2022 (note 15).
On 28 June 2023, Matsa entered into a short-term loan agreement with an existing lender for an
additional $750,000 loan facility. As at 30 June 2023, $500,000 was drawn down from the facility.
The $750,000 short-term loan facility is repayable by 30 September 2023. On 28 September 2023,
the repayment date for the drawn down amount of $500,000 was extended for a further three
months to 31 December 2023. All other key terms of the short-term loan include:
Interest Rate:
Security:
12% per annum paid monthly in arrears
The short-term loan facility is secured by a mortgage over the Fortitude gold
project tenements
- 77 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
14. 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)/(decrease) in provision
Closing balance 30 June
2023
$
2022
$
286,630
286,630
215,373
201,915
417,288
201,009
14,364
215,373
295,290
295,290
201,009
201,915
402,924
244,706
(43,697)
201,009
Movement in provision for mine restoration
Opening balance 1 July
Transfer to liabilities associated with assets held for sale (note
19)
Increase in provision
Closing balance 30 June
201,915
2,636,618
-
-
201,915
(2,506,240)
71,537
201,915
15.
Issued capital
2023
No.
2022
No.
2023
$
2022
$
Fully paid ordinary shares
412,007,370
358,954,620
65,596,745
63,892,578
Ordinary shares
At the beginning of reporting period
Share placements
Shares issued as a facility fee
Shares issued in lieu of payment (i)
Exercise of options
Transaction costs (ii)
At reporting date
358,954,620
52,000,000
150,000
900,000
2,750
-
412,007,370
315,962,745
42,191,875
-
800,000
-
-
358,954,620
63,892,578
1,976,000
5,550
34,200
468
(312,051)
65,596,745
60,696,604
3,375,350
-
45,600
-
(224,976)
63,892,578
(i) During the year, 900,000 shares were issued at $0.038 per share to acquire mining information,
data and technical advice. The amount of $34,200 was expensed in the consolidated statement of
profit or loss.
(ii) During the year, 15,000,000 share options with an exercise price of $0.08 each, were issued to
Westar Capital as part of their fee for acting as Lead Managers to the share placement. s at 30
June 2023, these options valued at $183,825 was recognised directly in equity as capital raising
transaction costs.
- 78 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
15. Issued capital (Continued)
Ordinary shares participate in dividends and the proceeds on winding up of the Company 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
$0.08
$0.09
$0.09
$0.35
$0.175
$0.21
$0.35
$0.25
$0.30
$0.17
$0.17
Expiry Date
30/11/2025
30/11/2025
30/11/2025
30/11/2022
30/11/2022
31/10/2023
30/11/2022
30/11/2022
30/11/2022
30/4/2023
30/11/2023
Balance at
beginning of year
No.
-
-
-
1,000,000
5,750,000
3,250,000
2,000,000
2,000,000
44,079,341
28,124,324
1,000,000
87,203,665
Issued
No.
15,000,000
6,000,000
3,000,000
-
-
-
-
-
-
-
-
24,000,000
16. Reserves
Equity settled transaction
Equity settled transaction reserve
Balance at beginning of financial year
Share based payment
Balance at end of financial year
Exercised
No.
Lapsed
No.
Balance at
end of
year
No.
-
-
-
-
-
-
-
-
-
-
-
-
- 15,000,000
6,000,000
-
3,000,000
-
-
(1,000,000)
(5,750,000)
-
2,150,000
(1,100,000)
-
(2,000,000)
-
(2,000,000)
-
(44,079,341)
(28,124,324)
-
1,000,000
-
(84,053,665) 27,150,000
2023
$
2022
$
10,317,900
10,317,900
10,028,515
10,028,515
10,028,515
289,385
10,317,900
10,023,186
5,329
10,028,515
The equity settled transaction reserve records share-based payment transactions.
17. Accumulated losses
Accumulated losses at beginning of financial year
Loss for the year
Accumulated losses at end of financial year
2023
$
2022
$
61,454,137
819,031
62,273,168
55,426,026
6,028,111
61,454,137
- 79 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
18.
(Loss)/earnings per share
2023
$
2022
$
The (loss)/earnings and weighted average number of ordinary
shares used in the calculation of loss per share are as follows:
Loss
Basic/diluted loss per share (cents per share)
(818,647)
(0.20)
(6,028,025)
(1.70)
Profit/(loss) from continued operations
Basic/diluted earnings/(loss) per share (cents per share)
126,050
0.03
(3,638,768)
(1.02)
Weighted average number of ordinary shares
No.
402,704,243
No.
355,009,331
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.
19. Assets classified as held for sale and discontinued operations
On 20 December 2021, the Company entered into a $20,000,000 Sale and Purchase Agreement (SPA)
with Linden for the sale of Red October and Devon Pits and associated tenements, which has delivered
the Company $3,000,000 in non-refundable deposits.
On 29 September 2022, the Company was advised that Linden had not received conditional approval
for admission to the ASX as required by the SPA and that Linden had 5 business days to advise the
Company whether or not it will complete the sale via a cash payment of $12,000,000. Linden was not
able to do so and therefore could not complete the transaction as per the SPA.
Following ongoing discussions with Linden, a proposal for a joint venture for the Devon Pit was agreed.
This allowed the Company to retain 100% of all the tenements listed in the SPA including the Red
October Gold project and Devon Gold project and continue to conduct exploration activities on these
projects (excluding the Devon Pit area) unhindered. See note 5(a) for further details of the JVA
between the Company and Linden.
As at 30 June 2022, the Red October and Devon Gold Project was previously classified as assets held
for sale in accordance with AASB 5 Non-current Assets Held for Sale and Discontinued Operations
(AASB 5).
As a result of the JVA, the Company continues to retain 100% ownership in the Devon Gold Project
and the project is no longer classified as an asset held for sale. At 30 June 2023, the carrying value
($2,655,963) of the Devon Gold Project was reclassified as exploration and evaluation assets in the
consolidated statement of financial position. The Devon Gold Project did not have any impact on the
comparative information in discontinued operations disclosed in the consolidated statement of
financial position and the consolidated statement of profit or loss and other comprehensive income.
The Company is continuing to evaluate all viable options for the Red October Gold Project including
ongoing discussions with multiple parties on a separate deal for the project. At 30 June 2023, the Red
October Gold Project continues to be classified as asset held for sale in accordance with AASB 5.
- 80 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
19. Assets classified as held for sale and discontinued operations (Continued)
In accordance with Australian Accounting Standards, immediately before the classification of the Red
October gold project as assets held for sale, the carrying value of the projects were assessed that they
were being carried at the lower of their carrying value and fair value less cost to dispose (FVLCD).
At the balance sheet date, the projects continue to be classified as assets held for sale in accordance
with AASB 5 Non-current Assets Held for Sale and Discontinued Operations. The carrying value of the
projects were reassessed and it was determined that they were being carried at the lower of their
carrying value and fair value less cost to dispose (FVLCD).
Any profit or loss arising from the sale of a discontinued operations or its measurement to fair value
less costs to sell is presented as part of a single line item, profit or loss from discontinued operations.
As at 30 June 2023, the carrying value of assets held for sale and liabilities associated with assets held
for sale in the statement of financial position are detailed below:
Assets held for sale:
Exploration and evaluation assets
Plant and equipment
Liabilities associated with assets held for sale:
Provision for mine restoration (note 14)
2023
$
6,438,051
127,296
6,565,347
2022
$
8,753,281
254,983
9,008,264
2023
$
2022
$
2,650,832
2,650,832
2,506,240
2,506,240
For the period ended 30 June 2023, the results of discontinued operations in the statement of profit
or loss are detailed below:
Revenue from customers (i)
Other income
Mining operations
Amortisation and depreciation
Care and maintenance
Other expenses
Loss on sale of fixed assets
Finance costs
Loss from discontinued operations
2023
$
2022
$
930,763
185,485
-
(374,501)
(1,485,013)
(16,605)
(40,234)
(144,592)
(944,697)
230,235
641,000
(444,537)
(814,758)
(1,675,747)
(932)
(252,452)
(72,066)
(2,389,257)
(i) During the year, the Company received confirmation that the final performance obligations for
gold ore delivered in 2021 has fulfilled the grade and recovery requirements. As such the variable
consideration related to these performance obligations has been met and the amount recognised
as revenue.
- 81 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
19. Assets classified as held for sale and discontinued operations (Continued)
The cash flow from discontinued operations included in the consolidated statement of cash flows
are as follow:
Net cash used in operating activities
Net cash used in investing activities
Net cash used in financing activities
Net cash flows used in discontinued operations
20. Commitments and contingencies
2023
$
2022
$
(1,250,054)
(259,733)
-
(1,509,787)
(3,031,666)
(80,473)
(529)
(3,112,668)
Exploration and expenditure commitments
In order to maintain the mineral tenements in which the Company and other parties are involved, the
Group 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 $2,236,400 (2022: $2,439,581). 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 2023 (30 June 2022: $nil).
- 82 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
21.
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
Siam Copper Resources Co Ltd
Loei Mining Co Ltd
Azure Circle Co Ltd
Forward Metals Co Ltd
Thai EV Minerals Co Ltd
22. Cash flow information
Country of Incorporation
Percentage Owned (%)
2023
2022
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Thailand
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
100
95
95
100
100
100
-
-
Reconciliation of cash and cash equivalents
Cash and cash equivalents at the end of the financial year as shown in the consolidated statement of
cash flows is reconciled to the related items in the consolidated statement of financial position as
follows:
Cash and cash equivalents
794,303
1,572,483
2023
$
2022
$
- 83 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
22. Cash flow information (Continued)
Reconciliation of loss for year to net cash flows from operating activities
2023
$
2022
$
Loss for year
(1,749,410)
(6,028,025)
Non-cash flows in loss from ordinary activities:
Share-based payments
Depreciation
Exploration expenditure written off/impaired
Net (gain)/loss on disposal of plant and equipment
Net (gain)/loss on sale of tenements
Interest expense classified as financing cash flow
Amortisation
Changes in assets and liabilities:
(Decrease)/increase in receivables
Increase in inventories
Decrease in trade creditors and accruals
Increase/(decrease) in provisions
Cash used in operating activities
Reconciliation of liabilities arising from financing activities
104,060
477,127
322,419
22,961
-
514,358
-
5,329
725,442
1,028,175
192,452
2,353,509
526,621
192,695
(764)
-
(195,899)
150,297
(354,851)
68,828
79,981
(1,883,445)
(53,093)
(2,791,531)
2023
Opening balance
Cash flows
Non-cash changes
Closing balance
2022
Opening balance
Cash flows
Non-cash changes
Closing balance
Lease
Liabilities
$
82,210
(89,072)
105,405
98,543
Lease
Liabilities
$
186,420
(104,210)
-
82,210
Borrowings
Total
$
4,118,332
379,960
85,112
4,583,404
$
4,200,542
290,888
190,517
4,681,947
Borrowings
Total
$
4,208,848
(224,868)
134,352
4,118,332
$
4,395,268
(329,078)
134,352
4,200,542
- 84 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
23. Parent entity disclosures
As at, and throughout, the financial year ended 30 June 2023, the parent company of the Group was
Matsa Resources Limited.
Company
2023
$
2022
$
(1,420,477)
-
(1,420,477)
(5,740,470)
-
(5,740,470)
481,053
10,113,073
1,709,393
5,917,387
1,387,360
9,483,444
5,659,824
5,860,832
65,596,744
10,317,900
(71,718,958)
63,892,577
10,028,515
(70,298,481)
4,195,686
3,622,611
Result of the parent entity
Loss for the year
Other comprehensive gain/(loss)
Total comprehensive 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
24.
Financial instruments
Financial risk management
Overview
This note presents information about the Group’s exposure to credit, liquidity and market risks and
its 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.
- 85 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
24.
Financial instruments (Continued)
Presently, the Group undertakes exploration and evaluation activities exclusively in Australia and
Thailand. At the reporting 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 and other
Consolidated Carrying amount
2023
$
237,340
794,303
367,363
2022
$
175,469
1,572,483
287,363
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 has leased assets financed by way of finance leases and has taken out a premium funding
facility over their insurance requirements.
- 86 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
24.
Financial instruments (Continued)
The following are the contractual maturities of financial liabilities, including estimated interest
payments and excluding the impact of netting agreements:
30 June 2023
Trade and
other
payables
Lease
liabilities
Insurance
premium
finance
Loan
30 June 2022
Weighted
average
interest
rate
%
Carrying
amount
Contractual
cash flows
6 mths or
less
6-12
mths
1-2
years
2-5 years
$
$
$
$
$
$
-
1,478,057
1,478,057 1,478,057
-
-
10.08
98,543
98,543
33,466 31,398 33,679
-
-
4.66
12
90,783
4,492,621
6,160,004
-
-
90,783
4,492,621
- 3,992,621
6,160,004 2,065,993 67,711 33,679 3,992,621
54,470 36,313
-
500,000
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
Insurance
premium
finance
Loan
-
6.78
2,694,409
82,210
2,694,409 2,694,409
47,414
82,210
-
18,946
-
15,850
3.83
12
120,160
3,998,172
6,894,951
120,160
120,160
3,998,172 3,998,172
6,894,951 6,860,155
-
-
18,946
-
-
15,850
-
-
-
-
-
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.
- 87 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
24.
Financial instruments (Continued)
As at the consolidated 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
Carrying amount
2023
$
117,341
79,225
2022
$
103,941
80,376
Sensitivity analysis
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 2023 would have increased equity by $17,870 (2022: $16,756), 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.
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
2023
$
2022
$
50,000
98,543
4,492,621
4,641,164
794,303
-
794,303
50,000
82,210
4,118,332
4,250,542
1,522,483
-
1,522,483
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.
- 88 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
24.
Financial instruments (Continued)
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
2022.
30 June 2023
Variable rate instruments
30 June 2022
Variable rate instruments
Profit or loss
100bp
increase
$
100bp
decrease
$
Equity
100bp
increase
$
100bp
decrease
$
7,943
(7,943)
7,943
(7,943)
15,225
(15,225)
15,225
(15,225)
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 should the applications not be
granted. As a result, the carrying amount is considered to approximate its fair value.
(ii)
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 its debt facility the majority of which is not repayable until 30
November 2025.
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.
- 89 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
25.
Share-based payments
Share-based payments expense
Directors and Executives (ii)
Employee Share Option Plan (i)
Consultants (iii)
2023
$
2022
$
66,600
37,460
183,825
287,885
5,329
-
-
5,329
During the year, the following options were issued;
(i) 3,000,000 share options with an exercise price of $0.09 each, were issued to employees. The
options vest immediately at the date of grant. The contractual life of each option is three years
and there is no cash settlement of the options. As at 30 June 2023, these options valued at $37,460
was recognised directly in the consolidated statement of profit and loss as share-based payment
expense.
(ii) 6,000,000 share options with an exercise price of $0.09 each, were issued to directors. The
exercise price has been calculated at 145% of $0.06 which is deemed as the vesting price condition
attached to the options, based on a 10-day trading period above the share price on the date of
issue of the options up to the expiry date. The contractual life of each option is three years and
there is no cash settlement of the options. As at 30 June 2023, these options valued at $66,600
was recognised directly in the consolidated statement of profit and loss as share-based payment
expense.
(iii) 15,000,000 share options with an exercise price of $0.08 each, were issued to Westar Capital as
part of their fee for acting as Lead Managers to the share placement. The options vest immediately
at the date of grant. The contractual life of each option is three years and there is no cash
settlement of the options. As at 30 June 2023, these options valued at $183,825 was recognised
directly in equity as capital raising transaction costs.
Employee Share Option Plan
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)
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.
- 90 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
25.
Share-based payments (Continued)
(f)
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)
(a)
Upon exercise the options will be settled in ordinary shares of Matsa Resources Limited.
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 KMP which have
been disclosed in the Remuneration Report.
2023
No.
2023
WAEP
$
2022
No.
2022
WAEP
$
Outstanding at the beginning
of the year
Granted
Other*
Forfeited
Outstanding at year-end
Exercisable at year-end
2,550,000
3,000,000
700,000
(1,100,000)
5,150,000
5,150,000
0.21
0.09
0.21
0.21
0.14
0.14
4,100,000
-
-
(1,550,000)
2,550,000
2,550,000
0.19
0.17
0.21
0.21
* David Fielding retired as the Group Exploration Manager but remained as a casual employee with
the Company from 5 December 2022. 700,000 options previously issued to Mr Fielding when he was
a key management personnel is added back to the total balance of options issued under ESOP.
The outstanding balance as at 30 June 2023 is represented by the following options over ordinary
shares, exercisable upon meeting the above terms and conditions:
2,150,000 options with an exercise price of $0.21 each and with an expiry date of 30 October 2023.
All have vested and are exercisable at balance date
3,000,000 options with an exercise price of $0.09 each and with an expiry date of 30 November
2025. All have vested and are exercisable at balance date
Directors and Executives Options
Directors
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 6,000,000
(2022: 1,000,000) options issued to Directors or Executives during the financial year.
- 91 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
25.
Share-based payments (Continued)
These share options were issued with an exercise price of $0.09. The exercise price has been
calculated at 145% of $0.06 which is deemed as the vesting price condition attached to the options,
based on a 10-day trading period above the share price on the date of issue of the options up to the
expiry date. The contractual life of each option is three years and there is no cash settlement of the
options.
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.
Executives
No options were issued to executives during the year ended 30 June 2023 (30 June 2022: $nil).
(b) Summary of options issued to Directors
(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
Other*
Expired during the year
Outstanding at 30 June
Exercisable at 30 June
2023
No.
7,450,000
6,000,000
(1,200,000)
(5,750,000)
6,500,000
6,500,000
2023
WAEP
$
0.178
0.09
0.21
0.175
0.10
0.10
2022
No.
12,200,000
1,000,000
-
(5,750,000)
7,450,000
7,450,000
2022
WAEP
$
0.174
0.17
-
0.17
0.178
0.178
* David Fielding retired as the Group Exploration Manager but remained as a casual employee with
the Company from 5 December 2022. Frank Sibbel retired as Non-Executive Director on 3 March 2023.
(c) Valuation models of options issued to Directors and employees under the ESOP
The fair value of the options granted to Directors during 2023 is estimated at the date of grant using
a Trinomial Option Valuation Model, taking into account the terms and conditions upon which the
options were granted.
The fair value of the options granted to Directors during 2022 is estimated at the date of grant using
a Black & Scholes model.
The fair value of the options granted to employees under the Employee Share Option Plan during 2023
is estimated at the date of grant using a Black & Scholes model.
- 92 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
25.
Share-based payments (Continued)
The following table gives the assumptions made in determining the fair value of the options granted
in the year.
Number of share options
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 ($)
2023
2022
Directors
6,000,000
Employees
3,000,000
Directors
1,000,000
Employees
-
69.1
3.27
3
0.09
0.04
0.011
68.94
3.02
3
0.09
0.04
0.01
71.71
0.54
2.0
0.17
0.05
0.005
-
-
-
-
-
-
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 2023
- equity settled
Share options granted in 2022
- equity settled
Total expense recognised as employee costs
Consultants
Consolidated
2023
$
2022
$
37,460
-
37,460
-
-
-
During the year, 15,000,000 share options with an exercise price of $0.08 each, were issued to
Westar Capital as part of their fee for acting as Lead Managers to the share placement. The options
vest immediately at the date of grant. The contractual life of each option is three years and there is
no cash settlement of the options.
The fair value of the options granted to Westar Capital is estimated at the date of grant using a Black
Scholes Option Valuation Model, taking into account the terms and conditions upon which the
options were granted.
- 93 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
25.
Share-based payments (Continued)
The fair value of the options granted was estimated at the date of grant using the following
assumptions:
Grant Date
1 September 2022
Number of Share Options
15,000,000
Dividend Yield (%)
Expected Volatility (%)
Risk-free interest rate (%)
Expected Life (years)
Exercise Price ($)
Fair Value per Option ($)
Nil
69.13
3.33
3
0.08
0.01
Total Value of Options ($)
183,825
The Company has recognised $183,825 (2022: $nil) of share based payment expense in equity as
share issue costs in the condensed consolidated statement of financial position.
26. Key management personnel
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
Pascal Blampain
Andrew Chapman
Executives
David Fielding
Executive Chairman and Managing Director
Non-Executive Director (Resigned 3 March 2023)
Executive Director
Executive Director and Company Secretary
Group Exploration Manager (Resigned 5 December 2022)
Key management personnel remuneration has been included in the Remuneration Report section of
the Directors’ Report on pages 37 to 45. These transferred disclosures have been audited.
Compensation of Key Management Personnel
Short-term employment benefits
Post-employment benefits
Termination benefits
Share-based payments
2023
$
906,653
81,880
-
66,600
2022
$
1,087,189
89,726
-
5,329
1,055,133
1,182,244
The compensation disclosed above represents an allocation of the key management personnel’s
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.
- 94 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
26. Key management personnel (Continued)
Other transactions and balances with Key Management Personnel
(a) P Poli is a Director of Bulletin Resources Limited. The Group has an agreement with Bulletin
to provide accounting, technical and administrative services on an arms-length basis. In the
current year $145,737 has been charged to Bulletin for these services (2022: $145,140).
At 30 June 2023 there was an outstanding balance of $25,300 (2022: $nil) for Bulletin.
(b) P Poli is a director and the only shareholder of Ultim8 Minesite Security Pty Ltd (‘Ultim8’). In
the prior year, the Group sold two vehicles to Ultim8 for $22,727. No further transactions
were entered into during the year.
At 30 June 2023 there was an outstanding balance of nil (2022: nil) receivable from Ultim8.
(c) P Poli is a director and controlling shareholder of West-Sure Group Pty Ltd which the Group
sub-lets storage space from. In the current year $6,371 has been charged to the Group for this
service (2022: $6,371).
At 30 June 2023, there was an outstanding balance of $1,752 (2022: $1,752) payable to West-
Sure.
(d) P Poli is a director and controlling shareholder of WA Fleet Systems Pty Ltd which provided
the Group with hire car services from time to time. In the current year $nil has been charged
to the Group for this service (2022: $1,250).
At 30 June 2023 there was an outstanding balance of $nil (2022: $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.
27. Related party transactions
Subsidiaries
Interests in subsidiaries are set out in Note 21.
Key management personnel
Disclosures relating to key management personnel are set out in the Remuneration Report and Note
26.
- 95 -
MATSA RESOURCES LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30
JUNE 2023
28. 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
Consolidated
2023
$
2022
$
66,650
65,750
16,000
82,650
19,190
84,940
29.
Events Subsequent to Balance Date
On 25 July 2023 Matsa announced that Linden was unable to meet Milestone 1 by 31 March 2023 as
well as an extension to meet Milestone 1 by 30 June 2023. In addition, Linden has failed to implement
approved budgets and programmes and failed to provide a 2024 financial year proposed programme
and budget as obligated as the Manager of the joint venture. As a result, Matsa issued a default notice
to Linden.
On 31 July 2023, the Company executed an agreement with AGAA, which provides AGAA an exclusive
three month period to conduct a due diligence and to discuss and negotiate a potential transaction
with the Company in respect of the Lake Carey Gold Project. AGAA paid the Company a lump sum of
$500,000 for the maintenance and dewatering costs of Red October Gold Mine in return for the
exclusivity period.
On 30 August 2023, the Company successfully completed a placement to professional and
sophisticated investors to raise approximately $2,000,000 before costs to advance the Lake Carey
Gold Project and continue building on the lithium prospectivity in Thailand.
As required under the terms of the JVA, on 31 August 2023, Linden submitted a Definitive Feasibility
Study in which Matsa considers not in compliant with the requirements of the JVA and deemed not
of suitable standard for financing purposes. As a result, a further Default Notice was issued on 20
September 2023.
On 28 September 2023, the repayment date for the drawn down amount of $500,000 was extended
for a further three months to 31 December 2023.
No matter or circumstance has arisen subsequent to the reporting date, which has significantly
affected, or may significantly affect the operations of the Group, the result of those operations, or the
state of affairs of the Group in subsequent financial years.
- 96 -
MATSA RESOURCES LIMITED
DIRECTORS’ DECLARATION
In the opinion of the directors of Matsa Resources Limited (the “Company”):
1.
the consolidated financial statements and notes are in accordance with the Corporations Act
2001, including:
(ii) giving a true and fair view of the Group’s financial position as at 30 June 2023 and of
its performance, for the financial year ended on that date; and
(iii) complying with Australian Accounting Standards and Corporations Regulations 2001;
(a)
(b)
(c)
the financial report also complies with International Financial Reporting Standards as
disclosed in note 2(b);
the remuneration disclosures that are contained in page 37 to 44 of the Remuneration
Report in the Directors’ Report comply with the Corporations Act 2001 and
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 2023.
Signed in accordance with a resolution of the directors;
Paul Poli
Executive Chairman
Perth, 29 September 2023
- 97 -
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 2023, the
Consolidated Statement of Profit or Loss, Consolidated Statement of Other Comprehensive Income, the
Consolidated Statement of Changes in Equity and the Consolidated Statement of Cash Flows for the year then
ended, and notes to the financial statements, including a summary of significant accounting policies, and the
directors’ declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act
2001, including:
(i) giving a true and fair view of the Group’s financial position as at 30 June 2023 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 believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
Material Uncertainty in relation to Going Concern
Without modifying our opinion, we draw attention to Note 2 (e) to the financial report, which indicates that
the Group will required to generate further funding to meet its planned exploration and administration
expenditure for a period of at least twelve months from the date of this report. This condition, along with
other matters as set forth in Note 2 (e), indicate the existence of a material uncertainty that may cast
significant doubt about the Group’s ability to continue as a going concern and therefore the Group may be
unable to realise its assets and discharge its liabilities in the normal course of business.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our
audit of the financial report of the current period. These matters were addressed in the context of our audit
of the financial report as a whole, and in forming our opinion thereon, and we do not provide a separate
opinion on these matters. In addition to the matter described in the Material Uncertainty in relation to Going
Concern section, we have determined the matter described below to the be key audit matter to be
communicated in our report.
How our audit addressed the key audit
matter
Our procedures included, amongst others:
▪ Obtaining an understanding of and
evaluating the processes and controls
associated with
the assessment of
impairment indicators;
▪ Assessing the Group’s right to explore in
interest, which
the relevant area of
assessing
and
included
supporting
Also
considering the status of the exploration
licences as they relate to tenure;
documentation.
obtaining
▪ Assessing the Group’s intention to carry
out significant exploration and evaluation
activity in the relevant exploration area,
including an assessment of the Group’s
cash-flow forecast models, discussing with
senior management and directors as to the
intentions and strategy of the Group;
the
▪ Assessing whether
exploration
activities within each area of interest have
reached a stage where the commercial
viability of extracting the resource could be
determined; and
▪ Assessing the adequacy of the disclosures
in the financial report.
Key audit matter
Capitalisation of Exploration and Evaluation
assets
Refer to Note 9 (Exploration and evaluation
assets)
Included in the statement of financial position as at
30 June 2023 is an amount for $14,532,559 (2022:
$10,627,811) relating to the Group capitalised
exploration and evaluation expenditure.
The carrying value of exploration and evaluation
expenditure is assessed for impairment by the
Group when facts and circumstances indicate that
capitalised exploration and evaluation
the
expenditure may exceed its recoverable amount.
The determination as to whether there are any
indicators that require the capitalised exploration
and evaluation expenditure to be assessed for
impairment involves a number of judgments
including but not limited to:
▪ Whether the Group has right of tenure of the
area of interest;
▪ Whether the Group has sufficient funds to meet
the area of interest minimum expenditure
requirements; and
▪ Whether there is sufficient information for a
decision to be made that the area of interest is
not commercially viable.
Due to the significance to the Group’s financial
report and the level of judgment involved in
assessing whether
impairment
indicators present, we consider this to be a key
audit matter.
there are
Directors’ responsibility for the financial report
The directors of the Company are responsible for the preparation of the financial report that gives a true and
fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such
internal control as the directors determine is necessary to enable the preparation of the financial report that
gives a true and fair view and is free from material misstatement, whether due to fraud or error.
In preparing the financial report, the directors are responsible for assessing the Group’s ability to continue as
a going concern, disclosing, as applicable, matters 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.
- 99 -
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 and Assurance Standards Board website at:
https://www.auasb.gov.au/auditors_responsibilities/ar1.pdf.
This description forms part of our auditor’s report
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 37 to 44 of the Directors’ Report for the year
ended 30 June 2023.
In our opinion, the Remuneration Report of Matsa Resources Limited, for the year ended 30 June 2023,
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
29 September 2023
- 100 -
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 8 September 2023
Range (size of holding)
Number of Holders Number of Units
%
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 – and over
63
45
130
785
377
1,400
4,728
143,445
1,099,234
28,734,061
445,692,569
475,674,037
0.001
0.030
0.231
6.041
93.697
100.00
The number of shareholdings held in less than marketable parcels is 465.
Twenty Largest Registered Shareholders of Fully Paid Ordinary Shares as at 8 September 2023
Name
No.
%
BNP Paribas Nominees Pty Ltd ACF Clearstream
BNP Paribas Nominees Pty Ltd
Sparta AG
BNP Paribas Noms Pty Ltd UOBKH A/C R’miers
HSBC Custody Nominees (Australia) Limited – A/C 2
HF Resources Pty Ltd
Delphi Unternehmensberatung Aktiengsellschaft
1
2
3
4
5
6
7
8 Mr Paul Poli
9
10 Goldfire Enterprises Pty Ltd
11
12
13 Goldfire Enterprises Pty Ltd
14
15 Goldfire Enterprises Pty Ltd
Duketon Consolidated Pty Ltd
RASL AU LLC
Citicorp Nominees Pty Limited
Newmek Investments Pty Ltd
16 Mr Jiaming Zhang
17
18
19
20 Mr Paul Poli & Mrs Sonya Kathleen Poli
Barry & Julie Alcock Pty Ltd
Delphi Unternehmensberatung Aktiengsellschaft
Emprise Nominees Pty Ltd
- 101 -
62,631,032
54,510,068
37,699,389
18,576,076
14,314,270
12,947,000
11,683,333
10,600,000
6,706,037
6,000,000
4,845,707
4,620,000
4,500,000
4,108,415
4,060,337
3,840,154
3,829,215
3,826,373
3,764,075
3,300,000
13.17
11.46
7.92
3.90
3.01
2.72
2.46
2.23
1.41
1.26
1.02
0.97
0.95
0.86
0.86
0.81
0.80
0.80
0.79
0.70
276,361,481
58.10
MATSA RESOURCES LIMITED
ASX ADDITIONAL INFORMATION
Substantial Shareholders
Ordinary shareholder
Sparta AG
Number
54,363,533
Percentage
11.43%
Fully paid
RESTRICTED SECURITIES
The Company has no restricted securities on issue.
STATEMENT OF UNQUOTED SECURITIES
Number of Options
2,150,000
1,000,000
31,833,333
15,000,000
6,000,000
3,000,000
Number of Holders
12
1
44
8
4
5
Exercise Price
$0.21
$0.17
$0.07
$0.08
$0.09
$0.09
Date of Expiry
31 October 2023
30 November 2023
7 September 2025
30 November 2025
30 November 2025
30 November 2025
- 102 -
MATSA RESOURCES LIMITED
ASX ADDITIONAL INFORMATION
TABLE OF MINERAL RESOURCES AND MINERAL RESERVES AT 30 JUNE 2023
Mineral Resource Estimates – Consolidated Summary & Annual Comparison
Project
Resource Category
Tonnes (‘000)
Au (g/t)
Metal Oz(‘000)
30 June 2022
Fortitude
Devon
Red October
Stockpiles
Nil
Devon
Red October
Fortitude
Devon
Red October
Stockpiles
Total
2.2
2.0
1.9
4.8
2.3
8.0
5.7
6.3
1.0
2.4
4.4
(0.2)
(0.1)
-
(0.3)
(0.9)
4.1
2.2
2.0
1.9
4.4
4.6
2.2
8.4
5.4
5.4
1.0
2.5
9
194
350
53
76
27
88
83
6
886
3
11
(9)
-
17
28
50
9
190
353
3
64
66
28
105
111
6
936
Measured
Indicated
Inferred
Indicated
Inferred
Measured
Indicated
Inferred
Inferred
127
3,021
5,767
341
1,021
105
483
411
191
11,467
Mining Depletion
Resource Adjustments
Measured
Indicated
Inferred
Measured
Indicated
Inferred
Measured
Indicated
Inferred
Measured
Indicated
Inferred
Measured
Indicated
Inferred
Inferred
18
93
(86)
-
125
224
373
30 June 2023
127
3,021
5,767
18
434
935
105
608
635
191
11,840
- 103 -
MATSA RESOURCES LIMITED
ASX ADDITIONAL INFORMATION
TABLE OF MINERAL RESOURCES AND MINERAL RESERVES AT 30 JUNE 2023 (continued)
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.
Resources include reserves.
Ore Reserve Estimates – Consolidated Summary & Annual Comparison
(The Ore Reserve estimates are a subset of the Mineral Resource estimates)
Project
Reserve Category
Tonnes (‘000)
Au (g/t)
Metal Oz(‘000)
Fortitude
Probable
30 June 2022
1,029
1,029
1.8
1.8
Nil
Nil
Fortitude
Total
Mining Depletion
Reserve Adjustments
30 June 2023
Probable
1,029
1,029
1.8
1.8
58
58
58
58
Reserve Statement Notes
Figures are rounded to reflect appropriate levels of confidence. Apparent differences may
occur due to rounding.
The geographic region for Gold Mineral Resources is Australia.
Summary of Governance Arrangements and Internal Controls
The Mineral Resource and Reserve estimates are reported 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 Ltd. There is no change to the reserve from the 2022 Annual Report.
Matsa confirms there is no new information pertaining to reserves and no changes to the underlying
reserve calculations/assumptions have been made.
Competent Persons Statement
Resources
The information in this document that relates to exploration targets, exploration results and Mineral
Resources, is based on information compiled by Pascal Blampain, who is a Member of the Australasian
Institute of Mining and Metallurgy and Australian Institute of Geoscientists. Pascal Blampain is a full-
time employee, and serves on the Board, of Matsa Resources Limited and 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
- 104 -
MATSA RESOURCES LIMITED
ASX ADDITIONAL INFORMATION
Blampain consents to the inclusion in the report of the matters based on his information in the form
and context in which it appears.
Reserves
There are no changes to reserves from the 2022 Annual Report. The information in this document that
relates to exploration targets, exploration results and Mineral Resources, is based on information
compiled by Pascal Blampain, who is a Member of the Australasian Institute of Mining and Metallurgy
and Australian Institute of Geoscientists. Pascal Blampain is a full-time employee, and serves on the
Board, of Matsa Resources Limited and 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 Blampain consents to the inclusion in
the report of the matters based on his information in the form and context in which it appears.
- 105 -
MATSA RESOURCES LIMITED
SCHEDULE OF MINING TENEMENTS
Tenement Type
and No.
E 52/3339
E 28/26001
E 28/26351
E38/2945
Project
Glenburg
Lake Rebecca
Lake Rebecca
Lake Carey
E 39/1837
E 39/1863
E 39/1864
E 39/1957
E 39/1958
E 39/1980
E 39/1981
P 39/5652
E 39/17962
E 39/1752
E 39/1770
E 39/1803
E 39/1812
E 39/1819
E 39/1834
E 39/1840
E 39/18892
E 39/2015
E39/2128
L 39/247
L 39/260
L 39/267
L 39/268
L 39/291
L39/295
M 39/1
M 39/1065
M 39/1089
M 39/286
M 39/709
M 39/710
P 39/5669
P 39/5670
P 39/5694
P 39/5841
E 47/3518
E 39/1760
E 39/1232
L39/222
L 39/235
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Lake Carey
Paraburdoo
Devon
Devon
Devon
Devon
Holder
Cundeelee Pty Ltd
Status
Live
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
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 Resources Limited
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
Matsa Gold Pty Ltd
- 106 -
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
Live
Live
Live
Live
Live
Live
Live
Live
Live
Share
Held
100%
20%
20%
100%
100%
100%
100%
100%
100%
100%
100%
100%
90%
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%
100%
100%
100%
100%
100%
MATSA RESOURCES LIMITED
SCHEDULE OF MINING TENEMENTS
Project
Holder
Status
Devon
Devon
Devon
Devon
Devon
Devon
Devon
Devon
Devon
Red October
Red October
Red October
Red October
Red October
Red October
Red October
Red October
Red October
Red October
Red October
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
Red October Gold Pty Ltd
Red October Gold Pty Ltd
Red October Gold Pty Ltd
Red October Gold Pty Ltd
Red October Gold Pty Ltd
Red October Gold Pty Ltd
Red October Gold Pty Ltd
Red October Gold Pty Ltd
Red October Gold Pty Ltd
Red October Gold Pty Ltd
Red October Gold Pty Ltd
Four Corners
Cundeelee Pty Ltd
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%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
Tenement Type
and No.
L 39/237
M 39/386
M 39/387
M 39/5003
M 39/629
M 39/10773
M 39/1078
P 39/6116
P 39/6117
L 39/217
L 39/273
M 39/411
M 39/412
M 39/413
M 39/599
M 39/600
M 39/609
M 39/610
M 39/611
M 39/721
E52/4237
1= 20% held by Matsa
2= 90% held by Matsa
3= Subject to a 50% profit sharing joint venture with Linden Alliance Limited
- 107 -
www.matsa.com.au