ABN 74 111 977 354
ANNUAL REPORT
2019
Maximus Resources Limited ABN 74 111 977 354
Corporate Directory
Directors
Gerard Anderson Acting Chairman
Kevin Malaxos Managing Director
Martin Janes Non-executive Director
Company Secretary
Justin Nelson
Registered Office
246 Angas Street
Adelaide, South Australia 5000
Principal Office
246 Angas Street
Adelaide, South Australia 5000
Telephone +61 8 7324 3172
Postal Address
GPO Box 1167
Adelaide SA 5001
Share Registry
Computershare Investor Services
Level 5, 115 Grenfell Street
Adelaide, South Australia 5000
Telephone +61 8 8236 2300
Facsimile +61 8 8236 2305
Solicitor
Level 10, 25 Grenfell Street
Adelaide, South Australia 5000
Telephone +61 8 8233 5555
Facsimile +61 8 8233 5556
Auditor
Grant Thornton Audit Pty Ltd
Level 3, 170 Frome Street
Adelaide, South Australia 5000
Banker
National Australia Bank
48 Greenhill Road
Wayville, South Australia 5034
Stock Exchange Listing
Australia Securities Exchange (Adelaide)
Maximus Resources Limited shares are
listed on the
Australian Securities Exchange
ASX code: MXR
Website
www.maximusresources.com
The website includes information about the Company, its strategies, projects, reports and ASX announcements.
Maximus Resources Limited ABN 74 111 977 354
Annual Report
Contents
Chairman’s Letter
Managing Director’s Report
Tenement Report Schedule
Directors' report
Auditor's Independence Declaration
Financial statements
Consolidated statements of profit or loss and other comprehensive income
Consolidated statements of financial position
Consolidated statements of changes in equity
Consolidated statements of cash flows
Notes to the consolidated financial statements
Directors' declaration
Independent auditor's report to the members
ASX Additional Information
Page
1
2
12
13
14
15
16
17
39
40
These financial statements are the consolidated financial statements of the consolidated entity consisting of Maximus
Resources Limited and its subsidiaries. The financial statements are presented in the Australian currency.
Maximus Resources Limited is a company limited by shares, is listed on the Australian Securities Exchange (ASX) under the
code "MXR" and is incorporated and domiciled in Australia. The registered office and principal place of business is:
Maximus Resources Limited
246 Angas Street
Adelaide
SA 5000
Registered postal address is:
Maximus Resources Limited
GPO Box 1167
Adelaide
SA 5001
A description of the nature of the Company's operations and its principal activities is included in the directors' report on pages 5
to 7.
The financial statements were authorised for issue by the directors on 30 September 2019. The directors have the power to
amend and reissue the financial statements.
Through the use of the internet, we have ensured that our corporate reporting is timely and complete. All press releases,
financial reports and other information are available on our website: www.maximusresources.com.
Maximus Resources Limited ABN 74 111 977 354
Chairman’s Letter
Dear Fellow Shareholders
On behalf of the Board of Directors, I present to you the 2019 Annual Report of Maximus Resources Limited.
Operationally, your Company achieved significant progress and performance improvements from the Burbanks gold
treatment plant at the commencement of the year. Sufficient tonnes were either secured or being negotiated to
continue producing at name-plate capacity. The gold industry was entering a period of resurgence with the gold price
increasing and demand for milling capacity also increasing. However, an increasing gold price can result in over-
confidence in potential client’s views of their project profitability and production timelines. We found ourselves having
to conduct high level reviews of prospective suppliers of ore to toll treat through our Burbanks plant to protect the
Company from non-performing mining companies. Announcements released by Maximus in mid-2018 noted the
potential for long term ore supply agreements at Burbanks. Unfortunately, many producers failed to achieve their
aggressive production targets, or worse, failed to survive. This resulted in intermittent ore supply to the Burbanks
plant, affecting its profitability.
The Company assessed options to turn-around Burbanks performance, with options ranging from accelerating the
approval process of our Spargoville projects to the divestment of the Burbanks assets. Accelerating the Spargoville
mines would take additional funds and a further 12 to 18 months to be in a position to provide our own ore to Burbanks.
Disposal of the Burbanks assets was determined not to be in the best interests of the Company at the time, so we
began the search for a joint venture partner to buy into the asset, in addition to retaining mill capacity to process ore
from our own mining operations once we had commissioned our own mine or mines. A suitable party was identified
in December, 2018 that had similar growth aspirations and operational objective to Maximus, and a Joint Venture
Agreement prepared. Unfortunately, the completion timeline was not achieved and those negotiations ceased in April
2019.
The decision was then made to divest 100% of Burbanks assets, and allow Maximus to focus on exploration activities
and advancing our current projects through the mining approvals process. Adaman Resources Pty Ltd (‘Adaman’), a
privately-owned company, submitted an offer in April 2019 to purchase 100% of the Burbanks assets for $5.8 million,
less capital upgrades to the tailings dam and Crusher access ramp, estimated at $600,000. Negotiations progressed
slowly, and milestone payment dates were missed by Adaman, whilst Maximus continued to incur holding costs for
Burbank. Following four months of negotiations, the Company decided to cease further negotiations with Adaman in
late September. Mineral Ventures Pty Ltd approached Maximus with an offer to purchase 100% of Burbanks assets
for the fixed sum of $5.2 million, including access to toll milling for a period of 2 years at the rate of 5,000 tonne per
month. Documentation was prepared, executed and the transaction finalised during the September quarter.
Your Company is now focused on rapidly advancing gold exploration within the Spargoville tenements, with a proven
resource base of 1.45 million tonnes for 112,000 JORC compliant gold ounces across five projects areas. We plan
to progress these projects through the project approval process and advance to production as quickly as possible.
Revenue from these operations should fund ongoing exploration on our high priority targets.
The Company has identified two proximal tier one targets with similar geophysical characteristics as Wattle Dam.
Maximus has obtained drilling approvals for these targets and has recently undertaken a Sub-audio Magnetic (or
SAM) survey south of Wattle Dam along the Spargoville and Eastern Shears to further investigate their potential.
Exploration drilling undertaken by Lepidico, under the 2017 Heads of Agreement to conduct lithium exploration,
intercepted significant nickel sulphide mineralisation in shallow drilling on the Company’s Spargoville tenements. This
mineralisation is comparable to other komatiite-hosted nickel sulphide deposits located on the Kambalda dome and
we consider these results to be significant. Further EM survey work is planned during the December quarter and a
Program of Works was submitted and approved by the WA Department for Mines and Petroleum for future
investigation. Maximus holds 80% of the nickel rights on these areas.
Throughout the year, our management team reviewed several project opportunities for potential acquisition, both in
Australia and overseas. This process continues, and the team is currently reviewing an international poly metallic
project.
I thank all our shareholders, staff and contractors for their assistance and support during the past year, and I look
forward to a year of revitalised exploration success and your continued support for Maximus in the coming year.
I would also like to thank our retiring Managing Director, Mr Kevin Malaxos for his dedication and hard work over the
last nine years and we wish him all the best in his new role.
Gerard Anderson
ACTING CHAIRMAN
Maximus Resources Limited ABN 74 111 977 354
Managing Director’s Report
The past year commenced with renewed enthusiasm for Maximus, with negotiations for long term ore supply
contracts for the Burbanks gold treatment plant progressing well and a clear focus to advance our gold exploration
activities at Spargoville to refine and grow our Ore reserves and resources.
The exploration team continued to achieve its goals, investigating priority targets and advancing our knowledge
base around the Wattle Dam project in search for repeat mineralised high grade structures.
The capital drain from the previous 12 months refurbishment and recommissioning of the Burbanks gold plant was
at an end, and revenue from toll milling activities was budgeted to accelerate our exploration efforts. Management
continued to review external projects for potential acquisition or joint venture, with several dormant projects
evaluated during the year.
As the gold industry continued to grow in confidence with an increasing gold price, so did the confidence of
marketers and would be producers to resurrect projects that had previously failed, or were justified on less than
robust performance capabilities. We encountered several of these operators in our quest to secure long term ore
supplies to the Burbanks Mill.
Burbanks Mill
The 2018 year began with three Toll milling agreements secured for the supply of up to 280,000 tonnes over the
following 2 years. Negotiations had commenced for a further 100,000 tonnes per annum toll milling contract and
the future of this operation looked secure. However, the failure to properly evaluate small underground projects
and diligently calculate operating costs resulted in the first customer ceasing operations, without notice. The second
intended producer encountered production issues resulting in a delay to the ore delivery schedule. Maximus scored
the trifecta, when it dodged a bullet by not accepting the revised terms proposed by a potential ore miner, which
subsequently went into administration.
Recovering from this poor start created issues on several fronts. Securing alternate gold ore feed for the Burbanks
plant at short notice was difficult, with smaller operators having already secured toll milling capacity through
alternate third party providers. The drain on financial reserves due to significantly reduced income from planned
toll milling operations resulted in delays to the planned exploration activities and the time taken to source potential
customers, negotiate toll contract terms and deal with delays and cessation of ore suppliers, restricted available
time to review projects for potential acquisition.
As a result of a Corporate review of the Company, the decision was made to divest 50% of Burbanks Milling
operations. A party made contact and agreement reached on a 50:50 joint venture, in addition to a 12 month upfront
lease period for Burbanks. This transaction failed to complete, which place further financial restrictions on the
Company. The original decision was amended to seek a buyer for 100% of the Burbanks assets, and a new party
identified. The 100% sale process progressed very slowly, with minimal headway made after 4 months of delays
and missed payment timelines. The board reached a decision that the interested party was not financial capable
nor technically able to complete the transaction, and negotiations were terminated to prevent further financial strain
on the Company. A suitable private group, with the financial capacity to complete the transaction contacted
Maximus, and the transaction was completed in a matter of weeks.
Maximus secured 2 years access to toll milling through Burbanks as part of the transaction, thus maintaining our
ability to secure processing of ore produced from our own mining operations. This important component to the sale
transaction ensured that Maximus could achieve the desired outcome that justified the original purchase of
Burbanks in 2016. The transaction was finalised on 30 September 2019 ensuring that the Company was well
funded into 2019 to immediately recommence on-ground exploration at Spargoville.
Spargoville
The Company continued to focus on converting the five Mineral Resource estimates to Reserve category.
Following economic analysis of each project, permitting requirements and project development scheduling can
be evaluated, which will determine potential future mine development sequencing. The total 2012 JORC
Complaint Resource Estimate for the Spargoville Project is currently 1,448,100 tonnes @ 2.41g/t for 112,280 Ozs
gold.
Maximus continued its analysis of the extensive data available on the Wattle Dam tenements in the search of
potential blind, short strike length high grade Wattle Dam type gold deposits. The Company’s has acquired data
from a Sub Audio Magnetic (SAM) Survey conducted immediately to the north of the Wattle Dam Pit. Interpretation
of this data has highlighted several target areas to the north of Wattle Dam, semi coincident with the trace of the
Spargoville Shear Zone, which hosts the Wattle Dam Gold Mine. In September, The Company completed a further
SAM survey on the area immediately south of the Wattle Dam pit, based upon the success of the previous SAM
survey in identifying drill targets. This SAM survey was successfully completed in late September and the data is
currently being finalised ahead of interpretation and drill target generation.
Maximus Resources Limited ABN 74 111 977 354
Managing Director’s Report
A Mining Lease Application has been submitted for M15/1896, Eagles Nest South to allow mining to commence on
the Company’s Eagles Nest Deposit, subject to the necessary regulatory approvals. The Eagles Nest Deposit
contains in excess of 40,000 Ozs of gold in a JORC 2012 Compliant Mineral Resource Estimate, with high
metallurgical recoveries reported. (MXR ASX Announcement dated 21/02/2017 titled “Increased Gold Resource at
Eagles Nest Project in Western Australia” and MXR ASX Announcement dated 24/02/2017 titled “Excellent
Metallurgical Results for Eagles Nest gold ore”). Due to the sustained high gold price of >$2000 AUD, the
development of the Eagles Nest Deposit has become a priority for the Company’s Mineral Resource Development
Plan.
Flushing Meadows
The Yandal Project (also known as Flushing Meadows) is currently being progressed by Yandal Resources Ltd,
formally Orex Mining Pty Ltd (Orex) and is proposing to develop the Flushing Meadows gold project in which
Maximus retains a $40 per ounce royalty interest.
The royalty obligation by Yandal Resources to Maximus is:
$40 per ounce on the first 50,000 ounces of gold from the tenement area. Yandal (formally held by Orex)
a)
must prepay the first $200,000 of royalties (representing the first 5,000 ounces of gold production) upon
commencement of gold production from all or any part of the tenement area; and
$20 per ounce for gold in excess of 50,000 ounces and less than 150,000 ounces in respect of gold from the
b)
tenement area.
Additionally, there is a 3% net smelter return royalty for any gold by-product or co-product from the tenement area.
The Maximus Royalty is satisfied once there is 150,000 ounces of gold produced from any part of the tenement
area and is capped at $4,000,000.
Adelaide Hills
The Company retains entitlement to two contingent $1 million payments (totalling $2 million) plus a gold production
royalty in accordance with the Bird in Hand Sale Agreement with Terramin Australia Limited (Terramin). The first
payment is due upon the environmental approval to mine (PEPR) from the South Australian Department for Energy
and Mining and the second payment is payable on the commencement of bullion production from the site.
Maximus also retains a 0.5% gross royalty on gold produced in excess of 50,000 Oz mined. The Bird in Hand Gold
Project has a resource base of 588,000 tonnes at 13.3g/t for 252,000 ounces of gold. Terramin announced that
the Mining Lease Application (MLA) has been submitted to the South Australian Department for Energy and Mining
for the Bird-in-Hand Gold Project and is currently under consideration for approval.
Corporate
During the first half of the financial year, the Company undertook a thorough review of our portfolio of assets and
infrastructure to determine where the Company wanted to be positioned and focus our resources. The decision
was made to focus on our excellent exploration opportunities and advance the Company towards becoming a
producer of ore. The decision was made to seek a joint venture partner for the Burbanks assets, thus securing a
partner to share the operational requirements for Burbanks, whilst retaining the capacity to treat Maximus ore
through its jointly own gold processing facility. This decision was revised in early 2019, and the decision to divest
100% of Burbanks was made, provided access to mill capacity was retained.
Following cessation of the Toll Milling Agreement with Empire Resources Ltd in December 2017, Empire
commenced resolution proceedings utilising an independent arbitrator in March 2018 against Eastern Goldfields
Milling Services (EGMS), a wholly owned subsidiary of Maximus Resources, regarding the quantum of gold
recovered during the Empire toll milling campaign. The Company continues to defend its position regarding the
Empire claim for outstanding gold and is confident that a resolution can be achieved in the near future.
Summary
The Company continues to search for, and evaluate potential gold projects both in Australia and internationally with
a view to bolstering the exploration portfolio and build on the Company’s asset base. Confidential discussions
continue on various projects for Joint Venture or acquisition.
Kevin Malaxos
Managing Director
Maximus Resources Limited
Tenement Schedule
30 June 2019
MAXIMUS RESOURCES LIMITED - TENEMENT SCHEDULE
Tenement
Number
Tenement Name
Registered Holder/Applicant
WESTERN AUSTRALIA
SPARGOVILLE PROJECT
M15/1475
P15/1869
L15/128
L15/255
M15/395
M15/703
M15/1448
M15/1449
P15/5912
M15/1101
M15/1263
M15/1264
M15/1323
M15/1338
M15/1474
M15/1769
M15/1770
M15/1771
M15/1772
M15/1773
M15/1774
M15/1775
M15/1776
Eagles Nest
Eagles Nest
Kambalda West
Kambalda West
Kambalda West
Kambalda West
Hilditch
Larkinville
Larkinville
Wattle Dam
Wattle Dam
Wattle Dam
Wattle Dam
Wattle Dam
Wattle Dam
Wattle Dam
Wattle Dam
Wattle Dam
Wattle Dam
Wattle Dam
Wattle Dam
Wattle Dam
Wattle Dam
BURBANKS PROJECT
G15/10
G15/11
G15/12
G15/13
G15/25
L15/109
L15/110
L15/189
L15/234
L15/284
M15/1273
M15/1369
M15/1370
Burbanks
Burbanks
Burbanks
Burbanks
Burbanks
Burbanks
Burbanks
Burbanks
Burbanks
Burbanks
Burbanks
Burbanks
Burbanks
Maximus Resources Ltd
Maximus Resources Ltd
Tychean Resources Ltd
Tychean Resources Ltd
Tychean Resources Ltd
Tychean Resources Ltd
Maximus Resources Ltd & Bullabulling Pty Ltd
Maximus Resources Ltd & Pioneer Resources Ltd
Maximus Resources Ltd & Pioneer Resources Ltd
Maximus Resources Ltd
Maximus Resources Ltd
Maximus Resources Ltd
Maximus Resources Ltd
Maximus Resources Ltd
Maximus Resources Ltd
Maximus Resources Ltd
Maximus Resources Ltd
Maximus Resources Ltd
Maximus Resources Ltd
Maximus Resources Ltd
Maximus Resources Ltd
Maximus Resources Ltd
Maximus Resources Ltd
Eastern Goldfields Milling Services Pty Ltd
Eastern Goldfields Milling Services Pty Ltd
Eastern Goldfields Milling Services Pty Ltd
Eastern Goldfields Milling Services Pty Ltd
Eastern Goldfields Milling Services Pty Ltd
Eastern Goldfields Milling Services Pty Ltd
Eastern Goldfields Milling Services Pty Ltd
Eastern Goldfields Milling Services Pty Ltd
Eastern Goldfields Milling Services Pty Ltd
Eastern Goldfields Milling Services Pty Ltd
Eastern Goldfields Milling Services Pty Ltd
Eastern Goldfields Milling Services Pty Ltd
Eastern Goldfields Milling Services Pty Ltd
Maximus
Resources
interest
30/06/2019
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
90.00%
75.00%
75.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
Page 1
Maximus Resources Limited
Directors' Report
30 June 2019
Directors' report
Your directors present their report on Maximus Resources Limited (the “Company”) and its controlled entities
(referred to hereafter as the Group) for the year ended 30 June 2019
Directors
The following persons were directors of the Group during the whole of the financial year and up to the date of this
report unless otherwise indicated:
Kevin John Malaxos (Managing Director)
Gerard Anderson (Non-executive Director) (appointed 1 November 2018)
Martin Simon Janes (Non-executive Director (appointed 1 August 2019)
Leigh Carol McClusky (Non-executive Director) (resigned 1 August 2019)
Ewan John Vickery (Non-executive Chairman) (resigned 30 November 2018)
Nicholas John Smart (Alternate director for E J Vickery) (resigned 24 August 2018)
Principal activities
During the year the principal activities of the Group consisted of commercial toll milling services of gold ore and
mineral exploration.
Dividends
There were no dividends declared or paid during the year (2018: Nil).
OPERATIONAL AND FINANCIAL REVIEW
1. Operating results and financial position
The result of operations of the Group for the financial year was a loss of $2,107,283 (2018: $1,410,844). The loss
from continuing operations was $401,733 (2018: $449,482) and the loss from discontinued operations was $1,705,550
(2018: $961,362).
The net assets of the Company have decreased by $1,537,235 during the financial year from $2,504,990 at 30 June
2018 to $967,755 at 30 June 2019. This loss is largely attributable to loss from operations partially offset by equity
raisings during the year and the debt forgiveness by Ramelius Resources Ltd (Ramelius). The financial accounts
disclose a current liability (financial liability) of $2,750,000 which relates to funds received from various parties in
relation to the Burbanks Mill sale. The sale of the mill settled in late September 2019, with $2,500,000 repaid to Adaman
Resources on 13 September 2019 and $750,000 to be repaid to GBF Mining Pty Ltd on 1 September 2019.
2. Review of Operations
Burbanks Mill
Operations at Burbanks Mill were suspended in late August 2018 due to limited supplies of third party gold ore to toll
treat and recommenced processing third party ore on a Toll treatment basis in December 2018.
The Company announced in December 2018 that it had negotiated a Binding Term Sheet with private Mining Services
Group, GBF Mining Pty Limited (GBF) for a 12-month lease of the Burbanks processing plant (Burbanks) with an option
to purchase 50% equity in Eastern Goldfields Milling Services Pty Ltd (EGMS), owner of the Burbanks mill for a
transaction valued up to $3.2 Million. The mill Lease was planned to commence from March 2019 through to February
2020. GBF paid an option to purchase fee totalling $750,000 to the Company. During April 2019 the Company
terminated the agreement with GBF.
On 4 April, 2019 the Company entered into an agreement with Adaman Resources Ltd to sell 100% of the Burbanks
Mill for $5.8 million, with adjustments for any major component defects identified during Due Diligence. The agreement
with Adaman Resources Ltd included an immediate payment of $2,000,000 on 3 April, 2019. These funds were
partially used to repay the outstanding loan balance to Ramelius, securing 100% ownership of the Burbanks mill.
Post balance date the Company terminated the sale agreement with Adaman Resources Limited due to failure to meet
agreed payment commitments, and entered into an agreement with Mineral Ventures Pty Ltd (Mineral Ventures) to
sell 100% of the Burbanks Mill for $5.2 million excluding GST. The Company received $2.8 million on 13 September
Page 2
Maximus Resources Limited
Directors' Report
30 June 2019
2019 from Mineral Ventures and repaid Loaned funds to Adaman Resources Limited. The Company received the
balance owing of $2.4 million on 30 September 2019.
Spargoville (WA)
The Company continued to focus on converting the five Mineral Resource estimates to Reserve category. Following
economic analysis of each project, permitting requirements and project development scheduling can be evaluated,
which will determine potential mine development sequencing.
The total 2012 JORC Complaint Resource Estimate for the Spargoville Project is currently 1,448,100 tonnes @
2.41g/t for 112,280 Ozs of gold. (see Table 2).
Project
Eagles Nest
Main Lode
FW Zone
Larkinville
5B
Redback
Hilditch
Total
Tonnes
Au g/t
Ozs
662,400
17,500
119,700
75,300
441,200
132,000
1,448,100
1.95
1.89
3.02
3.07
3.02
1.77
2.41
41,550
1,050
11,600
7,700
42,900
7,480
112,280
Table 2: Spargoville Project Mineral Resource inventory.
A Mining Lease Application has been submitted for P15-5545 to allow mining to commence on the Company’s
Eagles Nest Deposit, subject to the necessary regulatory approvals. The Eagles Nest Deposit contains in excess of
42,600 ozs of gold in a JORC 2012 compliant Mineral Resource estimate, with high metallurgical recoveries
reported.
P
Corporate
During the year, the Company negotiated with Ramelius repayment of its outstanding debt of $1,712,613. Ramelius
agreed to a payment $1,000,000 to finalise the outstanding amount owing for the purchase of EGMS if payment was
received by no later than 30 June 2019. The Company paid $1,000,000 to Ramelius during April 2019. This
payment has resulted in Ramelius forgiving the remaining $712,613 of the debt, with a once-off gain on debt
forgiveness recognised in the profit or loss.
During the 2019 financial year the following securities were issued:
• 304,095,000 ordinary shares were issued to sophisticated and professional investors on 6 September 2018.
The shares were offered at an issue price of $0.001 per share raising $304,095.
• The Company completed a consolidation of shares at 1:115 reducing the number of ordinary shares on issue
by 3,451,122,692 ordinary shares to 30,274,248 ordinary shares on issue.
• 4,540,956 ordinary shares were issued to sophisticated and professional investors on 3 May 2019. The
shares were offered at an issue price of $0.068 per share raising $308,785. These shares have a 1 for 2
attaching option, subject to shareholder approval prior to distribution, with an exercise price of $0.11 per share.
3. Significant changes in the state of affairs
During the year the Group decided to sell the Burbanks Mill as the board decided to focus the Company’s future on
exploration. The Burbanks Mill operations are considered a discontinued operation for the Group.
Other than noted above, there have been no significant changes in the above state of affairs from the 2018 financial
year to 2019.
Page 3
Maximus Resources Limited
Directors' Report
30 June 2019
4. Events arising since the end of the reporting period
Ms Leigh Mc Clusky resigned as a Director on 1 August 2019.
Mr Martin Janes was appointed as a Director on 1 August 2019.
Mr Kevin Malaxos resigned as a Managing Director effective on 30 November 2019.
During September 2019 the Company terminated the sale agreement with Adaman Resources Limited and entered
into an agreement with Mineral Ventures Pty Ltd to sell 100% of the Burbanks Mill for $5.2 million. The Company
received $2.8 million on 13 September 2019 from Mineral Ventures. The Company received the balance of $2.4
million on 30 September 2019.
There has been no other transaction or event of a material or unusual nature that has arisen in the interval between
the end of the financial year and the date of this report that is likely, in the opinion of the directors, to affect significantly
the operations of the Company, the results of those operations, or the state of affairs of the Company in future financial
years.
5. Future business developments, prospects and business strategies
The Company is poised to progress from a pure explorer to a producer in the near future, should continued exploration
success be achieved. The Spargoville tenements have presented several advanced gold exploration targets. The
Company plans to pursue the gold potential of the Spargoville tenements.
In addition to exploration on the Spargoville tenements, the Company intends to continue to review potential gold
projects and advance exploration targets held by other companies or individuals, within an economic trucking distance
to Coolgardie, to build upon the exploration asset base at Spargoville and grow future gold resources. These additional
3rd party targets may be acquired or accessed through joint ventures or other agreements.
6. Environmental regulation
The Company’s operations are subject to significant environmental regulation under both Commonwealth and State
legislation in relation to discharge of hazardous waste and materials arising from any exploration or mining activities
and development conducted by the Company on any of its tenements. The Company believes it is not in breach of
any environmental obligation.
Information on directors
Kevin John Malaxos BSc Mining Engineering.
Managing Director
Experience and expertise
A director since 13 December 2010, Mr Malaxos has 30 years’ experience in the resources sector in senior
management and executive roles across a suite of commodities including gold, nickel, iron ore, silver, lead, zinc and
chromium. He has managed surface and underground mining operations and brings a wealth of experience in project
evaluation and development, project approval and Government liaison.
Mr Malaxos' previous roles include CEO for Mt Gibson Mining (MGX) and COO of listed iron ore developer Centrex
Metals Limited (CXM), where he was responsible for project development, project approvals and community and
government consultation.
Other current directorships
Nil
Former directorships in the last 3 years
Mr Malaxos was a non-executive director of ASX-listed company Flinders Mines Limited (from December 2010 to
October 2016).
Special responsibilities
Managing Director.
Page 4
Maximus Resources Limited
Directors' Report
30 June 2019
Interests in shares and options
400,001 ordinary shares in Maximus Resources Limited.
Gerard Anderson Assoc. Applied Geology Grad Dip Bus MSc
Acting Non-executive Chairman (Appointed 1 November 2018)
Experience and expertise
Gerard is a geologist with 43 years’ experience in exploration, mine and resource geology principally in iron ore, gold
and base metals. Gerard’s senior management positions have included as Exploration Superintendent Boddington
Gold Mine, Chief Geologist Bronzewing Gold Mine, Chief Geologist Kalgoorlie Consolidated Gold Mines, General
Manager Golden Grove Operations, General Manager Newmont Joint Ventures and as Managing Director of
Croesus Mining Limited, Centrex Metals Limited, Archer Exploration Limited and as of March 2018, Woomera Mining
Limited.
In addition to his geology qualifications Gerard has completed a post graduate degree in Business and a Masters in
Mineral Economics.
Other current directorships
Mr Anderson is the Managing Director of Woomera Mining Limited
Former directorships in the last 3 years
Mr Anderson was previously the Managing Director of Archer Exploration Limited (from 14 July 2008 to 8 June 2016)
Special responsibilities
Acting Chairman of the Board (from 1 December 2018)
Member of the Audit, Risk & Corporate Governance Committee.
Interests in shares and options
14,420 ordinary shares in Maximus Resources Limited.
Martin Simon Janes BEc GAICD
Non-executive Director (Appointed 1 August 2019)
Experience and expertise
Martin is a mining executive with over 28 years’ experience. Until recently Martin was Chief Executive Officer of
Terramin Australia Limited (ASX: TZN) a position he commenced in June 2013 having been that company’s CFO
from August 2006 to December 2010. Martin was previously employed by ASX listed uranium company Toro
Energy Limited (ASX: TOE) (May 2011 to October 2012) where he held the position of General Manager – Marketing
& Project Finance. Martin has a strong finance background and specialty covering equity, debt & related project
financing tools and commodity off-take negotiation. While employed by Newmont Australia (previously Normandy
Mining) his major responsibilities included corporate & project finance, treasury management, asset sales and
product offtake management. Martin has a Bachelor of Economics and is member of the Australian Institute of
Company Directors.
Other current directorships
Mr Janes is a Non-Executive Director of Havilah Resources Limited
Former directorships in the last 3 years
Mr Janes was previously the Non-Executive Director of Twenty Seven Co Limited (from 2 October 2008 to 12 April
2016) and Non-Executive Director of Resource Base Limited (from 1 January 2016 to 20 August 2018
Special responsibilities
Non executive Director
Chair of the Audit, Risk & Corporate Governance Committee.
Interests in shares and options
Nil
Page 5
Maximus Resources Limited
Directors' Report
30 June 2019
Leigh Carol McClusky
Non-executive Director (resigned 1 August 2019)
Experience and expertise
Appointed as a director on 1 September 2010, Ms McClusky is the Managing Director of the McCo GROUP, a strategic
communications company with offices in Adelaide, Melbourne and Geelong.
After more than 30 years in key media roles across Melbourne, Sydney and Adelaide, Ms McClusky now works closely
with a range of organisations and industries to develop proactive communication campaigns and to deflect potentially
damaging impacts on corporate reputations. Her role also includes stakeholder engagement and management, client
advocacy and crisis communications.
Other current directorships
Nil
Former directorships in the last 3 years
Nil
Special responsibilities
Member of the Audit, Risk & Corporate Governance Committee.
Interests in shares, options and rights
69,038 ordinary shares in Maximus Resources Limited.
Ewan John Vickery LLB
Acting Non-executive Chairman (resigned 30 November 2018)
Experience and expertise
A director since incorporation 17 December 2004, Mr Vickery is a corporate and business lawyer with over 30 years’
experience in private practice in Adelaide. He has acted as an advisor to companies on a variety of corporate and
business issues including capital and corporate restructuring, native title and land access issues, and as lead native
title advisor and negotiator for numerous mining and petroleum companies.
He is a member of the Exploration Committee of the South Australian Chamber of Mines and Energy Inc, the
International Bar Association Energy and Resources Law Section, the Australian Institute of Company Directors and
is a past national president of Australian Mining and Petroleum Law Association (AMPLA Limited).
Former directorships in the last 3 years
Mr Vickery was a non-executive director of Tychean Resources Limited (from May 2013 to December 2017) and
Flinders Mines Limited (from 2000 to October 2016).
Special responsibilities
Acting Chairman of the Board (from March 2018 to 30 November 2018)
Chairman of the Audit, Risk & Corporate Governance Committee.
Interests in shares and options
369,566 ordinary shares in Maximus Resources Limited.
Nicholas John Smart
Alternate director for E J Vickery (resigned 24 August 2018)
Experience and expertise
An alternate director since 9 May 2005, Mr Smart has held positions as a general manager in Australia and
internationally. Previously a full Associate Member of the Sydney Futures Exchange and adviser with a national share
broking firm, with over 25 years’ experience in the corporate arena including capital raising for private and listed
companies. Other experience includes startup companies in technology development. Mr Smart currently consults to
various public and private companies.
Other current directorships
Vintage Energy Limited
Former directorships in the last 3 years
Alternate Non-Executive Director of Flinders Mines Limited (2009 to 2016)
Page 6
Maximus Resources Limited
Directors' Report
30 June 2019
Interests in shares and options
327 ordinary shares in Maximus Resources Limited.
Other current directorships quoted above are current directorships for listed entities only and excludes directorships of
all other types of entities, unless otherwise stated
Former directorships (last 3 years) quoted above are directorships held in the last 3 years in listed entities only and
excludes directorships of all other types of entities, unless otherwise stated.
Company Secretary
Justin Nelson LLB BA, (Jur)
Experience and expertise
Mr Nelson has extensive experience in the listed company environment through his former role as the ASX’s SA State
Manager and Manager Listings (Adelaide). An expert in corporate governance procedures, ASX Listing Rules and
company meeting practice, Mr Nelson is also a regular presenter on corporate governance topics for Chartered
Secretaries Australia (CSA), the leading independent authority on best practice in board and organisational
governance and risk management.
Meetings of directors
The numbers of meetings of the Company's board of directors and of each board committee held during the year
ended 30 June 2019, and the number of meetings attended by each director were:
Kevin Malaxos
Gerard Anderson
Leigh McClusky
Ewan Vickery
Nicholas Smart
Full
meetings of
directors
B
A
Audit & Risk
Committee
meetings
B
A
13
7
13
6
-
13
8
13
6
-
-
1
2
1
-
-
1
2
1
-
A = Number of meetings attended
B = Number of meetings held during the time the director held office or was a member of the committee during the
year
Indemnification and insurance of officers
The Company has entered into deeds of indemnity with each director whereby, to the extent permitted by the
Corporations Act 2001, the Company agreed to indemnify each director against all loss and liability incurred as an
officer of the Company, including all liability in defending any relevant proceedings.
The Company is required to indemnify the directors and other officers of the Company against any liabilities incurred
by the directors and officers that may arise from their position as directors and officers of the Company. No costs
were incurred during the year pursuant to this indemnity.
Insurance premiums
Since the end of the previous year the Company has paid insurance premiums of $22,828 to insure the directors and
officers in respect of directors' and officers' liability and legal expenses insurance contracts.
Proceedings On Behalf of Company
No person has applied to the Court under section 237 of the Corporations Act 2001 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.
No proceedings have been brought or intervened in on behalf of the Company with leave of the Court under section
237 of the Corporations Act 2001.
Page 7
Maximus Resources Limited
Directors' Report
30 June 2019
Non-audit services
The Board of Directors, in accordance with advice from the Audit Committee, is satisfied that the provision of
non-audit services during the year is compatible with the general standard of independence for auditors imposed by
the Corporations Act 2001. The directors are satisfied that the services disclosed below did not compromise the
external auditor’s independence for the following reasons:
•
•
all non-audit services are reviewed and approved by the Audit Committee prior to commencement to ensure
they do not adversely affect the integrity and objectivity of the auditor; and
the nature of the services provided do not compromise the general principles relating to auditor independence in
accordance with APES 110: Code of Ethics for Professional Accountants set by the Accounting Professional
and Ethical Standards Board.
Fees for non-audit services paid or payable to the external auditors or its related practices during the year ended 30
June 2019 was $5,400 (2018: $6,000).
Remuneration report – audited
The remuneration report is set out under the following main headings:
Principles used to determine the nature and amount of remuneration
Voting and comments made at the Company’s 2018 Annual General Meeting
Details of remuneration
Service agreements
Share-based compensation
A
B
C
D
E
The information provided in this remuneration report has been audited as required by section 308(3C) of the
Corporations Act 2001.
A. Principles used to determine the nature and amount of remuneration
The Company's policy for determining the nature and amounts of emoluments of board members and other key
management personnel of the Company is as follows:
The Company's Constitution specifies that the total amount of remuneration of non-executive directors shall be fixed
from time to time by a general meeting. The current maximum aggregate remuneration of non-executive directors
has been set at $300,000 per annum. Directors may apportion any amount up to this maximum amount amongst the
non-executive directors as they determine. Directors are also entitled to be paid reasonable travelling,
accommodation and other expenses incurred in performing their duties as directors. The remuneration of the
Managing Director is determined by the non-executive directors on the Board as part of the terms and conditions of
his employment which are subject to review from time to time. The remuneration of other executive officers and
employees is determined by the Managing Director subject to the approval of the Board.
Non-executive director remuneration is by way of fees and statutory superannuation contributions. Non-executive
directors do not participate in schemes designed for remuneration of executives nor do they receive options or bonus
payments and are not provided with retirement benefits other than salary sacrifice and statutory superannuation.
The Company's remuneration structure is based on a number of factors including the particular experience and
performance of the individual in meeting key objectives of the Company. The Board is responsible for assessing
relevant employment market conditions and achieving the overall, long term objective of maximising shareholder
benefits, through the retention of high quality personnel.
The Company does not presently emphasise payment for results through the provision of cash bonus schemes or
other incentive payments based on key performance indicators of the Company given the nature of the Company's
business as a junior listed mineral exploration entity and the current status of its activities. However, the Board may
approve the payment of cash bonuses from time to time in order to reward individual executive performance in
achieving key objectives as considered appropriate by the Board.
The Company also has an Employee Incentive Rights Plan approved by shareholders that enables the Board to offer
eligible employees rights to acquire ordinary fully paid shares in the Company. Under the terms of the Plan, rights to
acquire ordinary fully paid shares at no cost may be offered to the Company's eligible employees as determined by
the Board in accordance with the terms and conditions of the Plan. The objective of the Plan is to align the interests
of employees and shareholders by providing employees of the Company with the opportunity to participate in the
equity of the Company as a long-term incentive to achieve greater success and profitability for the Company and to
maximise the long term performance of the Company.
The employment conditions of the Managing Director were formalised in a contract of employment. The base salary
as set out in the employment contract is reviewed annually. The Managing Director’s contract may be terminated at
any time by mutual agreement and in instances of serious misconduct the Company may terminate his agreement
Page 8
Maximus Resources Limited
Directors' Report
30 June 2019
without notice.
No remuneration consultants were engaged for the year ending 30 June 2019.
B. Voting and comments made at the Company’s 2018 Annual General Meeting
Maximus Resources Limited received more than 92% of ‘yes’ votes on its remuneration report for the 2018 financial
year. The Company did not receive any specific feedback at the AGM or throughout the year on its remuneration
practices.
C. Details of remuneration
This report details the nature and amount of remuneration for each key management person of the Company.
The names and positions held by directors and key management personnel of the Company during the financial
year are:
•
•
•
•
•
•
Mr E J Vickery – Acting Chairman, non-executive (Non-Executive Director since 2004, Appointed
Acting Chairman March 2018 and resigned 30 November 2018)
Mr K J Malaxos - Managing Director
Mr G Anderson – Director, non-executive (Appointed 1 November 2018)
Ms L C McClusky - Director, non-executive (Resigned 1 August 2019)
Mr N J Smart - Alternate director for E J Vickery, non-executive
Mr J Nelson – Company Secretary
Key management personnel and other executives of the Company
2019
Short-term employee benefits
Post-employment
benefits
Name
Kevin J Malaxos
Gerard Anderson*
Leigh C McClusky*
Ewan J Vickery*
Nicholas J Smart
Justin Nelson**
Fees
$
-
-
-
-
-
30,000
Salary
$
395,519***
-
-
-
-
-
Annual
leave
accrued
$
19,314
-
-
-
-
-
Superannuation
$
23,858
-
-
-
-
-
Share-based
payments
Long-term
employee
benefits
Long service
leave
accrued Options Rights
$
-
-
-
-
-
-
$
6,274
-
-
-
-
-
$
-
-
-
-
-
-
Total
$
444,965
-
-
-
-
30,000
Total key management personnel
compensation
30,000
395,519
19,314
23,858
6,274
-
-
474,965
* The Directors suspended directors’ fees from 1 April 2017 to preserve cash for operational purposes.
Mr Nelson is engaged under a service contract with DMAW Lawyers Pty Ltd. During the year, fees were paid or payable for services
provided by Mr Nelson was $30,000.
***Mr Malaxos did not receive a salary from April 2017 to October 2017 to preserve cash for operational purposes. The Directors resolved
to back pay the unpaid salary of $144,377 during the current period.
Page 9
Key management personnel and other executives of the Company
Short-term employee benefits
Post-employment
benefits
2018
Name
Fees
$
Salary
$
Superannuation
$
accrued Options Rights
$
$
$
Robert M Kennedy* (ceased 20 March 2018)
Kevin J Malaxos***
Leigh C McClusky*
Ewan J Vickery*
Nicholas J Smart
Rajita S Alwis** (resigned 23 March 2018)
Justin Nelson (appointed 23 March 2018)
-
-
-
-
-
58,625
12,500
-
167,428
-
-
-
-
-
-
15,906
-
-
-
-
-
-
47,087
-
-
-
-
-
Total key management personnel
compensation
71,125
167,428
15,449
15,906
47,087
* The Directors suspended directors’ fees from 1 April 2017 to preserve cash for operational purposes.
Maximus Resources Limited
Directors' Report
30 June 2019
Share-based
payments
Long-term
employee
benefits
Long service
leave
Total
$
-
245,870
-
-
-
58,625
12,500
316,995
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Annual
leave
accrued
$
-
15,449
-
-
-
-
-
**Ms Alwis resigned on 23 March 2018 and Mr Justin Nelson was appointed as Company Secretary. Mr Nelson is engaged under a service contract
with DMAW Lawyers Pty Ltd. During the year, fees were paid or payable for services provided by Mr Nelson was $12,500.
***Mr Malaxos did not receive a salary from July 2017 to October 2017 to preserve cash for operational purposes.
Name
Kevin John Malaxos
Fixed remuneration
2018
%
100
2019
%
100
2019
At risk - STI*
2019
%
-
2018
%
-
At risk - LTI**
2019
%
-
2018
%
-
* Short-term incentives (STI) include cash incentive payments (bonuses) linked to Company and/or individual performance.
** Long-term incentives (LTI) include equity grants issued via the Company's Employee Share Option and Incentive Rights Plans. This plan is
designed to provide long-term incentives for executives to deliver long-term shareholder returns.
D. Service agreements
The Board has negotiated a contract with Mr Malaxos with no fixed term at a salary of $275,000 per annum inclusive
of superannuation guarantee contributions to be reviewed annually and with termination on three months’ notice.
All Non-executive Directors were engaged as directors with formal agreements per the ASX Corporate Governance
Principles and Recommendations Third Edition.
E. Share-based compensation
Incentive rights
The Company has an Employee Incentive Rights Plan approved by shareholders that enables the Board to offer
eligible employees rights to acquire ordinary fully paid shares in the Company. Under the terms of the Plan, rights to
acquire ordinary fully paid shares at no cost may be offered to the Company's eligible employees as determined by
the Board in accordance with the terms and conditions of the Plan. No rights were issued during the year.
Options granted as remuneration
No options were granted during the year.
Shares issued on exercise of remuneration options
No shares were issued to directors as a result of the exercise of remuneration options during the financial year.
Page 10
Maximus Resources Limited
Directors' Report
30 June 2019
Directors' interests in shares and options
(i) Option holdings
No director of Maximus Resources Limited or other key management personnel of the Company, including their
personally related parties have been issued or held options during the year ended 30 June 2018 or 2019. .
(ii) Share holdings
The numbers of shares in the Company held during the financial year by each director of Maximus Resources Limited
and other key management personnel of the Company, including their personally related parties, are set out below.
2019
Name
KJ Malaxos
G Anderson
L C McClusky
E J Vickery *
N J Smart **
*Resigned 30 November 2018
**Resigned 24 August 2018
2018
Name
R M Kennedy*
KJ Malaxos
L C McClusky
E J Vickery
N J Smart
*ceased in March 2018
Balance at the
start of the year
Received as
compensation
Consolidation
Adjustment
46,000,000
1,658,300
7,939,338
42,500,003
37,500
-
-
-
-
(45,599,999)
(1,643,880)
(7,870,300)
(42,130,437)
(37,173)
Ceased
-
-
-
(369,566)
(327)
Balance at the
end of the year
400,001
14,420
69,038
-
-
Balance at the
start of the year
Received as
compensation
91,500,000
46,000,000
7,939,338
42,500,003
37,500
-
-
-
-
-
Ceased
(91,500,000)
-
-
-
-
Acquired/
(disposed)
Balance at the
end of the year
-
-
-
-
-
-
46,000,000
7,939,338
42,500,003
37,500
F.
Transactions with key management personnel
The following transactions occurred with related parties:
During the year ended 30 June 2019, McClusky & Co Pty Ltd, of which Ms Leigh McCluksy is a director provided office space for
the head office. The amount paid for office and rental costs totalled $15,400 including GST. The office space is leased on a
month to month basis.
During the year ended 30 June 2018, Mandurang Pty Ltd, of which the late Mr Robert Kennedy was a Director of, loaned the
Company $50,000. The loan is interest bearing at 6% pa and is required to be repaid upon completion of a successful capital
raise. Interest has been capitalised into the total loan payable. At 30 June 2019 this loan remains outstanding.
During the year ended 30 June 2018, Mrs G Malaxos, spouse of Mr Kevin Malaxos, loaned the Company $40,000. The loan is
interest bearing at 6%pa and is required to be repaid upon completion of a successful capital raise. Interest has been capitalised
into the total loan payable. At 30 June 2019 this loan remains outstanding.
Transactions between related parties are on normal commercial terms and conditions no more favourable than those available to
other parties unless otherwise stated.
Shares under option
At the date of this report the Company has no shares under option. (2018: nil)
END OF AUDITED REMUNERATION REPORT
Auditors independence declaration
A copy of the auditor's independence declaration as required under section 307C of the Corporations Act 2001 is set
out on page 12.
This report is signed and dated in Adelaide on this 30th day of September 2019 and made in accordance with a
resolution of the directors.
Gerard Anderson
Director
Page 11
Grant Thornton Audit
Grant Thornton House
Level 3
170 Frome Street
Adelaide SA 5000
GPO Box 1270
Adelaide SA 5001
T +61 88372 6666
Auditor’s Independence Declaration
To the Directors of Maximus Resources Limited
In accordance with the requirements of section 307C of the Corporations Act 2001, as lead auditor for the audit of Maximus
Resources Limited for the year ended 30 June 2019, I declare that, to the best of my knowledge and belief, there have been:
a no contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
b no contraventions of any applicable code of professional conduct in relation to the audit.
GRANT THORNTON AUDIT PTY LTD
Chartered Accountants
J L Humphrey
Partner – Audit & Assurance
Adelaide, 30 September 2019
Grant Thornton Audit Pty Ltd ACN 130 913 594
a subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389
www.grantthornton.com.au
‘Grant Thornton’ refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory services to their clients
and/or refers to one or more member firms, as the context requires. Grant Thornton Australia Ltd is a member firm of Grant Thornton International
Ltd (GTIL). GTIL and the member firms are not a worldwide partnership. GTIL and each member firm is a separate legal entity. Services are
delivered by the member firms. GTIL does not provide services to clients. GTIL and its member firms are not agents of, and do not obligate one
another and are not liable for one another’s acts or omissions. In the Australian context only, the use of the term ‘Grant Thornton’ may refer to
Grant Thornton Australia Limited ABN 41 127 556 389 and its Australian subsidiaries and related entities. GTIL is not an Australian related entity to
Grant Thornton Australia Limited.
Liability limited by a scheme approved under Professional Standards Legislation.
Maximus Resources Limited
Consolidated statement of profit or loss and other comprehensive income
For the year ended 30 June 2019
Consolidated
30 June
2019
$
30 June
2018
$
Notes
Revenue
Gold Sales - Spargoville
Other income
Gain on debt forgiveness
Other income
Expenses
Compliance expenses
Depreciation expense
Employee expenses
Legal expenses
Marketing expenses
Finance expense
Exploration expenditure written off
Other expenses
Gain/(loss) on sale of shares
(Loss) before income tax
Income tax expense
Loss for the year from continuing operations
4
4
5
5
5
5
6
6,806
6,597
712,613
319
(154,614)
(662)
(501,473)
(74,386)
(5,146)
(11,900)
(161,426)
(211,864)
-
-
985
(121,721)
(1,641)
(120,865)
(2,709)
(4,970)
(20,376)
(515)
(173,168)
(11,099)
(401,733)
-
(449,482)
-
(401,733)
(449,482)
Loss for the year from discontinued operations
10
(1,705,550)
(961,362)
Loss for the year
(2,107,283)
(1,410,844)
Other comprehensive income for the year (net of tax)
-
-
Total comprehensive loss for the year
(2,107,283)
(1,410,844)
Earnings per share for (loss) from continuing operations
attributable to the ordinary equity holders of the
Company:
Basic earnings per share
-
-
TOTAL
From continuing operations
From discontinued operations
27
Cents
Cents
(1.38)
(5.84)
(7.22)
(0.015)
(0.032)
(0.047)
This statement should be read in conjunction with the notes to the financial statements.
Page 13
Maximus Resources Limited
Consolidated statement of financial position
As at 30 June 2019
Notes
Consolidated
30 June
2019
$
30 June
2018
$
ASSETS
Current assets
Cash and cash equivalents
Trade and other receivables
Inventories
Assets included in disposal group classified as held
for sale
Other current assets
Total current assets
Non-current assets
Plant and equipment
Exploration and evaluation
Total non-current assets
Total assets
LIABILITIES
Current liabilities
Trade and other payables
Financial liabilities
Liabilities included in disposal group classified as
held for sale
Provisions
Total current liabilities
Non-current liabilities
Provisions
Total non-current liabilities
Total liabilities
Net assets
EQUITY
Contributed equity
Accumulated losses
Total equity
7
8
10
9
11
12
13
16
10
14
15
17
18
160,682
366,597
-
3,518,250
35,023
28,823
342,987
18,368
-
146,865
4,080,552
537,043
439
2,775,089
3,997,596
2,622,942
2,775,528
6,620,538
6,856,080
7,157,581
1,981,722
2,850,101
928,981
126,476
1,892,756
1,806,899
-
136,819
5,887,280
3,836,474
1,045
1,045
816,117
816,117
5,888,325
4,652,591
967,755
2,504,990
40,895,357
(39,927,602)
967,755
40,325,309
(37,820,319)
2,504,990
This statement should be read in conjunction with the notes to the financial statements.
Page 14
Maximus Resources Limited
Consolidated statement of changes in equity
For the year ended 30 June 2019
Consolidated
Notes
$
Contributed equity
Accumulated
losses
$
Total equity
$
Balance at 1 July 2018
Total comprehensive loss for the year:
(Loss) for the year
Other comprehensive income
Transactions with owners in their
capacity as owners:
Contributions of equity
Transaction costs
Balance at 30 June 2019
Balance at 1 July 2017
Total comprehensive loss for the year:
(Loss) for the year
Other comprehensive income
Transactions with owners in their
capacity as owners:
Contributions of equity
Transactions costs
40,325,309
(37,820,319)
2,504,990
-
-
-
(2,107,283)
-
(2,107,283)
(2,107,283)
-
(2,107,283)
17
612,880
(42,832)
-
-
40,895,357
(39,927,602)
612,880
(42,832)
967,755
39,998,897
(36,409,475)
3,579,422
-
-
-
(1,410,844)
(1,410,844)
-
(1,410,844)
-
(1,410,844)
350,000
(13,588)
-
-
350,000
(13,588)
Balance at 30 June 2018
40,325,309
(37,820,319)
2,504,990
This statement should be read in conjunction with the notes to the financial statements.
Page 15
Cash flows from operating activities
Receipts from customers
Payments to suppliers and employees
Interest received
Interest paid
Net cash from continuing operations
Net cash from/(used in) discontinued operations
Net cash used in operating activities
Cash flows from investing activities
Proceeds from disposal of Lithium rights
Proceeds from sale of financial assets
Payments for exploration and evaluation
Net cash from continuing operations
Net cash from/(used in) discontinued operations
Maximus Resources Limited
Consolidated statement of cash flows
For the year ended 30 June 2019
Consolidated
30 June
2019
$
30 June
2018
$
Notes
6,806
(885,469)
319
(6,085)
(884,429)
(1,036,068)
121,553
(620,127)
985
(5,598)
(503,187)
459,191
(1,920,497)
(43,996)
-
-
(251,972)
(251,972)
(15,720)
120,000
68,901
(356,160)
(167,259)
(356,147)
10
26
10
Net cash provided by investing activities
(267,692)
(523,406)
Cash flows from financing activities
Proceeds from issues of shares and other equity securities
Proceeds from options to purchase Burbanks mill
Proceeds from Directors Loans
Repayment of Ramelius Resources loan
Transactions costs associated with equity issues
612,880
2,750,000
-
(1,000,000)
(42,832)
350,000
-
90,000
(60,000)
(13,588)
Net cash provided by financing activities
2,320,048
366,412
Net (decrease)/increase in cash and cash equivalents
Cash and cash equivalents at the beginning of the financial year
Cash and cash equivalents at the end of the financial year
7
131,859
28,823
160,682
(200,990)
229,813
28,823
This statement should be read in conjunction with the notes to the financial statements.
Page 16
Maximus Resources Limited
Notes to the consolidated Financial Statements
30 June 2019
1 Summary of significant accounting policies
The principal accounting policies adopted in the preparation of these consolidated financial statements are set out below.
These policies have been consistently applied to all the years presented, unless otherwise stated. The financial statements are
for the consolidated entity consisting of Maximus Resources Limited and its subsidiaries.
a) Basis of preparation
These general purpose financial statements have been prepared in accordance with Australian Accounting Standards, other
authoritative pronouncements of the Australian Accounting Standards Board and the Corporations Act 2001. Maximus
Resources Limited is a for-profit entity for the purpose of preparing the financial statements.
(i) Compliance with IFRS
The consolidated financial statements of the Maximus Resources Limited also comply with International Financial Reporting
Standards (IFRS) as issued by the International Accounting Standards Board (IASB).
Australian Accounting Standards include Australian equivalents to International Financial Reporting Standards (AIFRS).
Compliance with AIFRSs ensures that the financial statements and notes comply with International Financial Reporting
Standards (IFRS).
(ii) Historical cost convention
These financial statements have been prepared on an accrual basis, under the historical cost convention, as modified by the
revaluation of available-for-sale financial assets, financial assets and liabilities (including derivative instruments) at fair value
through profit or loss and certain classes of property, plant and equipment.
(iii) Critical accounting estimates
The directors evaluate estimates and judgments incorporated into the financial report based on historical knowledge and best
available current information. Estimates assume a reasonable expectation of future events and are based on current trends
and economic data, obtained both externally and within the Company.
(iv) New accounting standards adopted in the current year
Two new accounting standards have been adopted in the current year.
-
-
Neither standard had an impact on the group reported results on implementation.
AASB 15 – Revenue from contracts with customers
AASB 9 – Financial Instruments
Going concern
The financial report has been prepared on the basis of going concern.
The cash flow projections of the Company and consolidated entity evidence that there is a material uncertainty that the
Company is a going concern as it is reliant on a capital raising and /or asset sale for continued operations.
The Company incurred a loss of $2,107,283 (2018: $1,410,844) with negative operating and investing cashflows of
$2,188,189. The operations were funded by revenues from toll milling operations, equity issues and funds received from
various parties regarding the option to purchase the Burbank Mill during the year.
The Company and consolidated entity’s ability to operate as a going concern is contingent upon completion of the Burbanks Mill
sale if additional capital is not obtained, and the going concern basis of accounting may not be appropriate. As a result, the
Company may have to realise its assets to extinguish its liabilities, other than in the ordinary course of business in amounts
which could be different from those stated in the financial report. No allowance for such circumstances has been made in the
financial report.
b) Basis of consolidation
The Group financial statements consolidate those of the Parent Company and all of its subsidiaries as of 30 June 2019. The
Parent controls a subsidiary if it is exposed, or has rights, to variable returns from its involvement with the subsidiary and has
the ability to affect those returns through its power over the subsidiary. All subsidiaries have a reporting date of 30 June 2019.
All transactions and balances between Group companies are eliminated on consolidation, including unrealised gains and
losses on transactions between Group companies. Where unrealised losses on intra-group asset sales are reversed on
consolidation, the underlying asset is also tested for impairment from a group perspective. Amounts reported in the financial
statements of subsidiaries have been adjusted where necessary to ensure consistency with the accounting policies adopted by
the Group.
Profit or loss and other comprehensive income of subsidiaries acquired or disposed of during the year are recognised from the
Page 17
Maximus Resources Limited
Notes to the consolidated Financial Statements
30 June 2019
effective date of acquisition, or up to the effective date of disposal, as applicable.
c) Revenue and Other Income
Revenue is measured at the fair value of the consideration received or receivable. Revenue from the rendering of services is
recognised upon the delivery of the service to the customer. The Group recognises contract liabilities when consideration is
received in respect to unsatisfied performance obligations.
Revenue from the sale of gold is measured at fair value of the consideration received or receivable. Revenue is recognised
when gold is delivered to the buyer.
Interest revenue is recognised using the effective interest rate method.
d) Employee Benefits
Short-term employee benefits
Short-term employee benefits are benefits, other than termination benefits, that are expected to be settled wholly within twelve
(12) months after the end of the period in which the employees render the related service. Examples of such benefits include
wages and salaries, non-monetary benefits and accumulating sick leave. Short-term employee benefits are measured at the
undiscounted amounts expected to be paid when the liabilities are settled.
Other long-term employee benefits
The Group’s liabilities for annual leave and long service leave are included in other long term benefits as they are not expected
to be settled wholly within twelve (12) months after the end of the period in which the employees render the related service.
They are measured at the present value of the expected future payments to be made to employees. The expected future
payments incorporate anticipated future wage and salary levels, experience of employee departures and periods of service,
and are discounted at rates determined by reference to market yields at the end of the reporting period on high quality
corporate bonds (2018: government bonds) that have maturity dates that approximate the timing of the estimated future cash
outflows. Any re-measurements arising from experience adjustments and changes in assumptions are recognised in profit or
loss in the periods in which the changes occur.
The Group presents employee benefit obligations as current liabilities in the statement of financial position if the Group does
not have an unconditional right to defer settlement for at least twelve (12) months after the reporting period, irrespective of
when the actual settlement is expected to take place.
e) Segment reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision
maker. The chief operating decision maker has been identified as the Board of Directors.
f)
Income tax
The income tax expense or revenue for the period is the tax payable on the current period's taxable income based on the
applicable income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to
temporary differences and to unused tax losses.
The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the end of the
reporting period in the countries where the Company's subsidiaries and associates operate and generate taxable income.
Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is
subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax
authorities.
Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of
assets and liabilities and their carrying amounts in the financial statements. However, deferred tax liabilities are not
recognised if they arise from the initial recognition of goodwill. Deferred income tax is also not accounted for if it arises from
initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction
affects neither accounting nor taxable profit or loss. Deferred income tax is determined using tax rates (and laws) that have
been enacted or substantially enacted by the end of the reporting period and are expected to apply when the related deferred
income tax asset is realised or the deferred income tax liability is settled.
Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that future
taxable amounts will be available to utilise those temporary differences and losses.
Deferred tax liabilities and assets are not recognised for temporary differences between the carrying amount and tax bases of
investments in controlled entities where the Company is able to control the timing of the reversal of the temporary differences
and it is probable that the differences will not reverse in the foreseeable future.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities
Page 18
Maximus Resources Limited
Notes to the consolidated Financial Statements
30 June 2019
and when the deferred tax balances relate to the same taxation authority. Current tax assets and tax liabilities are offset
where the entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realise the asset and
settle the liability simultaneously.
Current and deferred tax is recognised in profit or loss, except to the extent that it relates to items recognised in other
comprehensive income or directly in equity. In this case, the tax is also recognised in other comprehensive income or directly
in equity, respectively.
The Company and its subsidiaries are not part of a consolidated tax group.
g)
Impairment of non-financial assets
Assets that have an indefinite useful life are not subject to amortisation and are tested annually for impairment, or more
frequently if changes in circumstances indicate that they might be impaired. Other assets are tested for impairment whenever
events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is
recognised for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is
the higher of an asset's fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are
grouped at the lowest levels for which there are separately identifiable cash inflows which are largely independent of the cash
inflows from other assets or groups of assets (cash-generating units). Non-financial assets other than goodwill that suffered
an impairment are reviewed for possible reversal of the impairment at each reporting date.
h) Cash and cash equivalents
For the purpose of presentation in the statement of cash flows, cash and cash equivalents includes cash on hand, deposits
held at call with financial institutions, other short-term, highly liquid investments with original maturities of 3 months or less that
are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value, and bank
overdrafts.
i)
Trade receivables
Trade receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest
method, less provision for expected credit losses. Trade 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.
The Group uses a simplified approach in accounting for trade and other receivables and records the loss allowance at the
amount equal to the expected lifetime credit losses. The Group uses its historical experience, external indicators and forward-
looking information to calculate the expected credit losses using a provision matrix. The Group has assessed the impact of the
impairment model and no adjustment was required in Group’s financial statements.
j)
Investments and other financial assets
Recognition and derecognition
Regular purchases and sales of financial assets are recognised on trade-date - the date on which the Company commits to
purchase or sell the asset. Financial assets are derecognised when the rights to receive cash flows from the financial assets
have expired or have been transferred and the Company has transferred substantially all the risks and rewards of ownership.
When securities classified as available-for-sale are sold, the accumulated fair value adjustments recognised in other
comprehensive income are reclassified to profit or loss as gains and losses from investment securities.
Measurement
At initial recognition, the Company measures a financial asset at its fair value plus, in the case of a financial asset not at fair
value through profit or loss, transaction costs that are directly attributable to the acquisition of the financial asset. Transaction
costs of financial assets carried at fair value through profit or loss are expensed in profit or loss.
Loans and receivables and held to maturity investments are subsequently carried at amortised cost using the effective interest
method.
Impairment
The Company assesses at the end of each reporting period whether there is objective evidence that a financial asset or group
of financial assets is impaired. A financial asset or a group of financial assets is impaired and impairment losses are incurred
only if there is objective evidence of impairment as a result of one or more events that occurred after the initial recognition of
the asset (a ‘loss event’) and that loss event (or events) has an impact on the estimated future cash flows of the financial asset
or group of financial assets that can be reliably estimated.
If there is evidence of impairment for any of the Company's financial assets carried at amortised cost, the loss is measured as
the difference between the asset's carrying amount and the present value of estimated future cash flows, excluding future
Page 19
Maximus Resources Limited
Notes to the consolidated Financial Statements
30 June 2019
credit losses that have not been incurred. The cash flows are discounted at the financial asset's original effective interest rate.
The loss is recognised in the statement of profit or loss and other comprehensive income.
Provision for restoration and rehabilitation
The Company assesses the mill restoration and rehabilitation provision in accordance with accounting policies. Significant
judgement is required in determining the provision for restoration and rehabilitation as there are many transactions and other
factors that will affect the ultimate liability payable to rehabilitate the mill site. The estimate of future costs therefore requires
management to make assessment of the future restoration and rehabilitation date, future environmental legislation, changes in
regulations, price increases, changes in discount rates, the extent of restoration and rehabilitation activities and future removal
technologies. When these factors change and become known in the future, such differences will impact the restoration and
rehabilitation provision in the period in which they change or become known. At each reporting date, the rehabilitation and
restoration provision is remeasured to reflect any of these changes.
k) Plant and equipment
Each class of plant and equipment is carried at cost or fair value less, where applicable, any accumulated depreciation and
impairment losses.
Plant and equipment
Plant and equipment is measured on the cost basis. The carrying amount of plant and equipment is reviewed annually by
directors to ensure it is not in excess of the recoverable amount. The recoverable amount is assessed on the basis of the
expected net cash flows that will be received from the assets’ employment and subsequent disposal. The expected net cash
flows have been discounted to their present values in determining recoverable amounts.
Subsequent costs are included in the assets’ carrying amount or recognised as separate assets as appropriate, only when it is
probable that future economic benefits associated with the item will flow to the Company and the cost can be measured
reliably. All other repairs and maintenance are charged to the statement of profit or loss and other comprehensive income
during the financial period in which they are incurred.
Depreciation
The depreciable amount of all fixed assets is depreciated on a straight-line basis over their useful lives to the Company
commencing from the time the asset is held ready for use. The depreciation rates used for plant & equipment are from 12.5%
to 40%.
The assets' residual values and useful lives are reviewed, and adjusted if appropriate, at each reporting date.
An asset's carrying amount is written down immediately to its recoverable amount if the asset's carrying amount is greater than
its estimated recoverable amount note 1(f).
Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in the
statement of profit or loss and other comprehensive income. When revalued assets are sold, it is Company policy to transfer
any amounts included in other reserves in respect of those assets to retained earnings.
l)
Trade and other payables
These amounts represent liabilities for goods and services provided to the Company prior to the end of financial year which are
unpaid. The amounts are unsecured and are usually paid within 30 days of recognition. Trade and other payables are
presented as current liabilities unless payment is not due within 12 months from the reporting date. They are recognised
initially at their fair value and subsequently measured at amortised cost using the effective interest method.
m) Earnings per share (EPS)
(i) Basic earnings per share
Basic earnings per share is calculated by dividing:
•
•
the profit attributable to equity holders of the Company, excluding any costs of servicing equity other than ordinary
shares
by the weighted average number of ordinary shares outstanding during the financial year, adjusted for bonus
elements in ordinary shares issued during the year and excluding treasury shares.
(ii) Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account:
•
•
the after income tax effect of interest and other financing costs associated with dilutive potential ordinary shares,
and
the weighted average number of additional ordinary shares that would have been outstanding assuming the
conversion of all dilutive potential ordinary shares.
Page 20
Maximus Resources Limited
Notes to the consolidated Financial Statements
30 June 2019
n) Exploration and evaluation expenditure
Exploration and evaluation costs related to an area of interest are written off as incurred except they may be carried forward as
an item in the statement of financial position where the rights of tenure of an area are current and one of the following
conditions is met:
•
•
the costs are expected to be recouped through successful development and exploitation of the area of interest, or
alternatively, by its sale; and
exploration and/or evaluation activities in the area of interest have not at the end of each reporting period reached a
stage which permits a reasonable assessment of the existence or otherwise of economically recoverable reserves,
and active and significant operations in, or in relation to, the area of interest are continuing.
Capitalised costs include costs directly related to exploration and evaluation activities in the relevant area of interest. General
and administrative costs are allocated to an exploration or evaluation asset only to the extent that those costs can be related
directly to operational activities in the area of interest to which the asset relates.
Capitalised exploration and evaluation expenditure is written off where the above conditions are no longer satisfied.
All capitalised exploration and evaluation expenditure is assessed for impairment if facts and circumstances indicate that an
impairment may exist. Exploration and evaluation assets are also tested for impairment once commercial reserves are found,
before the assets are transferred to development properties.
o) Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of associated GST, unless the GST incurred is not
recoverable from the taxation authority. In this case it is recognised as part of the cost of acquisition of the asset or as part of
the expense.
Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of GST
recoverable from, or payable to, the taxation authority is included with other receivables or payables in the statement of
financial position.
Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities
which are recoverable from, or payable to the taxation authority, are presented as operating cash flows.
p) Comparative figures
Comparative figures are adjusted to conform to Accounting Standards when required.
q) 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.
r) Profit or loss from discontinued operations
A discontinued operation is a component of the Group that either has been disposed of, or is classified as held for sale. Profit
or loss from discontinued operations comprises the post-tax profit or loss of discontinued operations and the post-tax gain or
loss recognised on the measurement to fair value less costs to sell or on the disposal group constituting the discontinued
operation.
s) Current assets and liabilities classified as held for sale and discontinued operations
Current assets classified as held for sale are presented separately and measured at the lower of their carrying amounts
immediately prior to their classification as held for sale and their fair value less costs to sell. However, some held for sale
assets such as financial assets or deferred tax assets, continue to me measured in accordance with the Group’s relevant
accounting policy for those assets. Once classified as held for sale, the assets are not subject to depreciation or amortisation.
t) Key estimates
The preparation of the financial statements requires management to make estimates and judgments. These estimates and
judgments are continually evaluated and are based on historical experience and other factors, including expectations of future
Page 21
Maximus Resources Limited
Notes to the consolidated Financial Statements
30 June 2019
events that may have a financial impact on the Group and that are believed to be reasonable under the circumstances.
The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition,
seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material
adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below:
Impairment
The Group assesses impairment at each reporting date by evaluating conditions specific to the Group that may lead to
impairment of assets. Where an impairment trigger exists, the recoverable amount of the asset is determined. Value-in-use
calculations performed in assessing recoverable amounts incorporate a number of key estimates.
Exploration and Evaluation
The Company’s policy for exploration and evaluation is discussed in Note 1(n). The application of this policy requires
management to make certain assumptions as to future events and circumstances. Any such estimates and assumptions may
change as new information becomes available. If, after having capitalised exploration and evaluation expenditure,
management concludes that the capitalised expenditure is unlikely to be recovered by future sale or exploration, then the
relevant capitalised amount will be written off through the statement of profit or loss and other comprehensive income.
u) Standards, amendments and interpretations to existing standards that are not yet effective and have not been
adopted early by the group:
Accounting Standards issued by the AASB that are not yet mandatorily applicable to the Group, together with an assessment
of the potential impact of such pronouncements on the Group when adopted in future periods, are discussed below:
AASB 16: Leases (applicable to annual reporting periods beginning on or after 1 July 2019).
When effective, this Standard will replace the current accounting requirements applicable to leases in AASB 117: Leases and
related Interpretations. AASB 16 introduces a single lessee accounting model that eliminates the requirement for leases to be
classified as operating or finance leases.
The main changes introduced by the new standard are as follows:
•
•
•
•
•
recognition of a right-of-use asset and lease liability for all leases (excluding short-term leases with a lease term 12
months or less of tenure and leases relating to low-value assets);
depreciation of right-of-use assets in line with AASB 116: Property, Plant and Equipment in profit or loss and
unwinding of the liability in principal and interest components;
inclusion of variable lease payments that depend on an index or a rate in the initial measurement of the lease liability
using the index or rate at the commencement date;
application of a practical expedient to permit a lessee to elect not to separate non-lease components and instead
account for all components as a lease: and
inclusion of additional disclosure requirements.
The transitional provisions of AASB 16 allow a lessee to either retrospectively apply the Standard to comparatives in line with
AASB 108 or recognise the cumulative effect of retrospective application as an adjustment to opening equity on the date of
initial application.
As at the reporting date, the Group has no operating lease commitments (Note 22).
The impact of adopting this standard is not expected to significantly impact future financial statements.
2 Financial risk management
The Company's activities expose it to a variety of financial risks: market risk (including interest rate risk), credit risk and liquidity
risk. The Company's overall risk management program focuses on the unpredictability of financial markets and seeks to
minimise potential adverse effects on the financial performance of the Company.
Risk management is carried out by management under policies approved by the Board of Directors. The Board provides
principles for overall risk management, as well as policies covering specific areas, such as interest rate risk, credit risk, the use
of financial instruments and investment of excess liquidity.
The Company's financial instruments consist mainly of deposits with banks, accounts receivable and payable.
Page 22
The Company holds the following financial instruments:
Financial assets
Cash and cash equivalents
Trade and other receivables
Financial liabilities
Trade and other payables
Financial liabilities – current
(a) Market risk
Maximus Resources Limited
Notes to the consolidated Financial Statements
30 June 2019
Consolidated
30 June
2019 $
160,682
366,597
527,279
1,981,722
2,850,101
4,831,823
30 June
2018 $
28,823
342,987
371,810
1,892,757
1,806,898
3,699,655
(i) Price risk
Price risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate as a result of changes in market
prices (other than those arising from foreign exchange or interest rate risk). The Company is not exposed to any material price
risk.
(i) Cash flow and fair value interest rate risk
Interest rate risk is the risk that a financial instrument's value will fluctuate as a result of changes in market interest rates and the
effective weighted interest rates on classes of financial assets and financial liabilities. Interest rate risk is managed by the
Company with the use of rolling short-term deposits.
The Company has no long term financial liabilities upon which it pays interest.
As at the end of the reporting period, Maximus Resources Limited had the following variable rate cash and cash equivalent
holdings:
Cash and cash equivalents
Net exposure to cashflow interest rate
30 June
2019
Weighted
average
interest rate
%
1.95
30 June
2019
Balance
$
160,682
160,682
30 June
2018
Weighted
average
interest
rate %
1.95%
30 June
2018
Balance
$
28,823
28,823
Interest rate sensitivity analysis
At 30 June 2019, the effect on profit and equity as a result of changes in the interest rate, with all other variables remaining
constant would be as follows:
30 June 2019
Financial assets
Cash and cash equivalents
Total increase/ (decrease)
30 June 2018
Financial assets
Cash and cash equivalents
Total increase/ (decrease)
Carrying
amount
$
160,682
Carrying
amount
$
28,823
Interest rate risk
Increase 2%
Decrease 2%
Profit
$
Equity
$
Profit
$
Equity
$
34
34
34
34
(34)
(34)
(34)
(34)
Increase 2%
Decrease 2%
Profit
$
Equity
$
50
50
50
50
Profit
$
(50)
(50)
Equity
$
(50)
(50)
Page 23
Maximus Resources Limited
Notes to the consolidated Financial Statements
30 June 2019
(b) Credit risk
Credit risk is the risk of default by borrowers and transactional counterparties as well as the loss of value of assets due to
deterioration in credit quality. Credit risk arises from cash and cash equivalents and deposits with banks and financial
institutions, as well as credit exposures to wholesale and retail customers, including outstanding receivables and committed
transactions. For banks and financial institutions, only independently rated parties with a minimum rating of 'A' are accepted.
Individual risk limits are set based on internal or external ratings in accordance with limits set by the board. Sales to retail
customers are required to be settled in cash or using major credit cards, mitigating credit risk.
(c) Liquidity risk
Liquidity risk is the risk that the Company may encounter difficulty in settling its debts or otherwise meeting its obligations. The
Company manages liquidity risk by monitoring cash flows and ensuring that adequate funds are available to meet cash
demands.
3 Segment information
(a) Description of segments
Identification of reportable segments
Management has determined the operating segments based on the reports reviewed and used by Managing Director (the chief
operating decision maker) are used to make strategic decisions. The Group is managed primarily on the basis of geographical
area of interest, since the diversification of the Group operations inherently has notably different risk profiles and performance
assessment criteria. Operating segments are therefore determined on the same basis.
Reportable segments disclosed are based on aggregating operating segments where the segments are considered to have
similar economic characteristics and are also similar with respect to the following:
•
•
external regulatory requirements
geographical and geological styles
Accounting policies developed
Unless stated otherwise, all amounts reported to the Managing Director as chief decision maker with respect to operating
segments are determined in accordance with accounting policies that are consistent to those adopted in the annual financial
statements of the Group.
2019
Exploration
Burbanks Mill
Other
Total
Segment revenue
6,806
2,897,480
714,294
3,618,580
$
$
$
$
Adjusted earnings before interest, tax, depreciation
and amortisation (EBITDA)
Impairment
Segment assets
Capital expenditure
Impairment
154,620
(1,424,039)
161,426
-
2,775,089
4,046,914
313,573
15,720
(161,426)
-
Total movement for the year
152,147
15,720
Total segment assets
Unallocated assets
Total assets
-
-
-
-
-
-
(1,424,039)
161,426
6,822,003
329,293
(161,426)
167,867
6,779,064
77,016
6,856,080
Page 24
Maximus Resources Limited
Notes to the consolidated Financial Statements
30 June 2019
3. Segment Information (cont)
2018
Exploration
$
Burbanks Mill
$
Other
$
Total
$
Segment revenue
6,597
3,717,522
-
3,724,119
$
$
$
$
Adjusted earnings before interest, tax,
depreciation and amortisation (EBITDA)
Impairment
Segment assets
Capital expenditure
6,597
(1,216,803)
-
-
(515)
(515)
(1,210,721)
(515)
2,622,942
4,511,343
-
7,134,285
355,646
339,456
515
695,617
Total movement for the year
355,646
339,456
-
695,102
Total segment assets
Unallocated assets
Total assets
(ii) Adjusted EBITDA
A reconciliation of adjusted EBITDA to operating loss before income tax is provided as follows:
4. Other income
Gain on debt forgiveness
7,134,285
23,295
7,157,582
Consolidated
30 June
2019
$
30 June
2018
$
712,613
-
During the year, the Company negotiated with Ramelius the repayment of its outstanding debt of $1,712,613. Ramelius agreed
to a payment $1,000,000 to finalise the outstanding amount owing for the purchase of EGMS if payment was received by no
later than 30 June 2019. The Company paid $1,000,000 to Ramelius during April 2019. This payment has resulted in Ramelius
forgiving $712,613 of the debt.
Interest received
5. Expenses
Other
Consulting costs
Occupancy expenses
Other costs
319
319
985
985
Consolidated
30 June
2019
$
150,670
30,045
31,149
30 June
2018
$
111,984
44,837
16,347
211,864
173,168
Page 25
Compliance expenses
Share registry fees
ASX fees
Audit Fees
Insurance
Other compliance expenses
Marketing
Marketing and promotion
Exploration expenses
General exploration expenditure written off
Capitalised exploration expenditure impaired
6. Income Tax Expense
(a)
Income tax expense:
Current tax
(b) Numerical reconciliation of income tax expense to
prima facie tax payable
Loss from continuing operations before income tax
expense
Tax at the Australian tax rate of 27.5%
Tax effect of amounts which are not deductible
(assessable) in calculating taxable income:
Temporary differences not brought to account
Income tax expense
Maximus Resources Limited
Notes to the consolidated Financial Statements
30 June 2019
49,460
20,824
54,936
20,525
8,869
154,614
5,146
5,146
1,530
159,896
161,426
32,964
20,711
43,500
22,828
1,718
121,721
4,970
4,970
68
447
515
Consolidated
30 June
2019
$
30 June
2018
$
-
-
-
-
(401,733)
(449,482)
(110,477)
(123,608)
110,477
123,608
-
-
A deferred tax asset (DTA) has not been recognised in respect of temporary differences as they do not meet the recognition
criteria as outlined in Note 1(f) of the financial statements. A DTA has not been recognised in respect of tax losses either as
realisation of the benefit is not regarded as probable.
The Company has unrecognised DTAs of $8,260,304 (2018: $7,696,402) that are available indefinitely for offset against future
taxable profits.
The tax rates applicable to each potential tax benefit are as follows:
•
•
timing differences – 27.5%
tax losses – 27.5%
Page 26
7. Current assets - Cash and cash equivalents
Cash at bank and in hand
Term deposits
(a) Risk exposure
Maximus Resources Limited
Notes to the consolidated Financial Statements
30 June 2019
Consolidated
30 June
2019
$
30 June
2018
$
143,682
17,000
11,823
17,000
160,682
28,823
The Company's exposure to interest rate risk is discussed in note 2. The maximum exposure to credit risk at the end of each
reporting period is the carrying amount of each class of cash and cash equivalents mentioned above.
(b) Deposits at call
The deposits are bearing a weighted average interest rate of 1.95% (2018: 1.95%).
8. Current assets - Trade and other receivables
Net trade receivables
Trade and other receivables
9. Current assets - Other current assets
Accrued revenue
Prepayments
Consolidated
30 June
2019
$
30 June
2018
$
366,597
342,987
366,597
342,987
Consolidated
30 June
2019
$
30 June
2018
$
-
35,023
128,250
18,615
35,023
146,865
Page 27
Maximus Resources Limited
Notes to the consolidated Financial Statements
30 June 2019
10. Disposal group classified as held for sale and discontinued operations
During the 2019 year, management decided to discontinue operations at the Burbanks mill, in line with its strategy to focus on the
Company’s exploration assets. Consequently, assets and liabilities allocated to Burbanks were reclassified as a disposal group.
Revenue and expenses in relation to the discontinuation of this subgroup have been eliminated from profit and loss from the
Group’s continuing operations and are shown as a single line item in the statement of profit or loss.
In September 2019, the Burbanks mill was sold for $5.2 million cash to Mineral Ventures Pty Ltd.
Operating losses of the Burbanks mill until the date of disposal and the profit or loss from re-measurement and disposal of assets
and liabilities classified as held for sale are summarised as follows:
Revenue - milling
Other income
Total income
Cost of sales
Milling expenses - consumables
Crushing expenses
Leaching expenses
Laboratory expenses
Gold room expenses
Tailings Dam expenses
Employee expenses
Insurance expenses
Depreciation
Licence fees
Legal fees
Travel expenses
Other mill expenses
Total cost of sales
Operating loss
Finance costs
Loss from discontinued operations before tax
Tax expense
Loss for the year from discontinued operations
The carrying amounts of assets and liabilities in this disposal group are summarised as follows:
Current assets
Property, plant and equipment
Inventories - consumables
Assets classified as held for sale
Current liabilities
Provisions – employee entitlements (Mill staff)
Provisions – restoration/rehabilitation
Liabilities classified as held for sale
30 June 2019
30 June 2018
$
$
2,890,674
35,296
2,925,970
3,717,522
30,236
3,747,758
1,441,146
736,730
347,904
84,393
67,859
60,284
1,268,706
54,889
211,362
1,507
114,407
11,814
160,370
1,000,037
538,516
552,204
119,140
76,314
195,214
1,473,382
48,162
191,216
371
105,307
29,146
317,938
4,561,371
4,646,947
(1,635,401)
(70,149)
(1,705,550)
(899,189)
(62,173)
(961,362)
-
-
(1,705,550)
(961,362)
30 June 2019
$
3,498,875
19,375
3,518,250
52,778
876,203
928,981
Page 28
Cashflows used by Burbanks mill for the reporting periods under review until its disposal are as follows:
Maximus Resources Limited
Notes to the consolidated Financial Statements
30 June 2019
Operating activities
Investing activities
Cashflows used in discontinued operations
11. Plant and equipment
Consolidated
At 30 June 2018
Cost or fair value
Accumulated depreciation
Net book amount
Year ended 30 June 2019
Opening net book amount
Assets scrapped
Asset purchases
Depreciation charge
Assets held for sale included in disposal group
Closing net book amount
At 30 June 2019
Cost or fair value
Accumulated depreciation
Net book amount
Consolidated
Year ended 30 June 2018
Opening net book amount
Asset purchases
Depreciation charge
Closing net book amount
At 30 June 2018
Cost or fair value
Accumulated depreciation
Net book amount
30 June 2019
30 June 2018
$
$
(1,036,068)
(15,720)
(1,051,788)
(459,191)
(356,147)
(815,338)
Other plant
and
equipment
$
Burbanks
plant &
equipment
$
Burbanks
Office
equipment
and furniture
$
Total
$
22,222
(21,121)
4,200,364
(225,379)
24,356
(2,846)
4,246,942
(249,346)
1,101
3,974,985
21,510
3,997,596
1,101
-
-
(662)
-
439
22,222
(21,783)
439
3,974,985
(301,878)
15,720
(208,528)
(3,480,299)
21,510
-
-
(2,934)
(18,576)
-
-
-
-
-
-
-
-
3,997,596
(301,878)
15,720
(173,840)
(3,498,875)
439
22,222
(21,783)
439
Other plant
and
equipment
$
Burbanks
plant &
equipment
$
Burbanks
Office
equipment
and furniture
$
Total
$
2,742
-
(1,641)
3,815,333
349,227
(189,575)
16,231
6,920
(1,641)
3,834,306
356,147
(192,857)
1,101
3,974,985
21,510
3,997,596
22,222
(21,121)
4,200,364
(225,379)
24,356
(2,846)
4,246,942
(249,346)
1,101
3,974,985
21,510
3,997,596
Page 29
Maximus Resources Limited
Notes to the consolidated Financial Statements
30 June 2019
12. Non-current assets - Exploration and evaluation
Exploration and evaluation
Movement:
Opening balance
Expenditure incurred
Sales of Lithium rights*
Impairment of capitalised expenditure
Closing balance
Consolidated
30 June
2019
30 June
2018
2,622,942
313,573
-
(161,426)
2,775,089
2,467,297
356,160
(200,000)
(515)
2,622,942
*The Company sold its Lithium rights to ASX-listed company Lepidico Ltd for $80,000 worth of Lepidico fully paid ordinary
shares and a cash payment of $120,000.
13. Current liabilities - Trade and other payables
Trade payables
Prepaid revenue
Other payables and accruals
14. Current liabilities – Provisions
Provision – Employee benefits
Opening current liabilities provisions at 1 July 2018
Employee benefits accrued
Liabilities held for sale included in disposal group – Burbanks Mill employees
Closing current liabilities provisions at 30 June 2019
15. Non-current liabilities – Provisions
Provision – Employee benefits
Provision – Restoration
Consolidated
30 June
2019
$
30 June
2018
$
1,674,984
-
306,738
1,159,160
205,000
528,596
1,981,722
1,892,756
Consolidated
30 June
2019
$
30 June
2018
$
126,476
136,819
126,476
136,819
136,819
42,435
(52,778)
126,476
Consolidated
30 June
2019
$
30 June
2018
$
1,045
-
1,045
815,072
1,045
816,117
In the current year, the restoration provision associated with the Burbanks Mill has been transferred to liabilities associated with
the disposal group (refer note 10)
Page 30
16. Current liabilities – Financial liabilities
Loans from related parties (refer to note 23)
Financial Liability – Burbanks sale proceeds (a)
Financial Liability – Ramelius Resources Ltd (Royalty) (b)
Maximus Resources Limited
Notes to the consolidated Financial Statements
30 June 2019
Consolidated
30 June
2019
$
30 June
2018
$
100,101
2,750,000
-
94,286
-
1,712,613
2,850,101
1,806,899
(a) During the year ended 30 June 2019, the Company entered into negotiations with various parties to sell the Burbanks Mill.
During December 2018 the Company signed a Binding Term Sheet with GBF Mining Pty Ltd (GBF) for a 12 month lease
of the Burbanks Mill, commencing in March 2019 or earlier, plus an option to acquire 50% of the equity in the Company’s
wholly owned subsidiary, EGMS. GBF paid lease option fees totalling $750,000 to the Company. During April 2019 the
Company terminated the agreement with GBF.
On 4 April 2019 the Company entered into agreement with Adaman Resources Ltd (Adaman) to sell 100% of the Burbanks
Mill for $5.8 million, with adjustments for major component defects identified during due diligence. The agreement with
Adaman included an immediate payment of $2,000,000.
(b) During the year the Company negotiated with Ramelius the repayment of its outstanding debt of $1,712,613. Ramelius
agreed to a payment $1,000,000 to finalise the outstanding amount owing for the purchase of EGMS, if payment was
received by no later than 30 June 2019. The Company paid $1,000,000 to Ramelius during April 2019. This payment
resulted in Ramelius forgiving $712,613 of the debt.
Page 31
17. Contributed equity
(a) Share capital
Ordinary shares
Fully paid
(b) Movements in ordinary share capital:
Maximus Resources Limited
Notes to the consolidated Financial Statements
30 June 2019
Consolidated
30 June
2019
30 June
2018
Consolidated
30 June
2019
30 June
2018
34,815,204 3,177,301,940
40,895,357
40,325,309
$
$
Date
Details
Number of
shares
Issue
price
$
1 July 2017
Opening balance
2,854,269,632
39,988,897
6 September 2017
6 September 2017
26 April 2018
Issue of Shares - placement
Issue of Shares – placement
Issue of Shares – placement
83,140,002
89,892,306
150,000,000
$0.001
$0.0013
$0.001
Less: Transaction costs arising on share issues
83,140
116,680
150,000
350,000
(13,588)
30 June 2018
Balance
3,177,301,940
40,325,309
6 September 2018
20 December 2018
3 May 2019
Issue of Shares - placement
Consolidation (1:115)1
Issue of Shares – placement
304,095,000
(3,451,122,692)
4,540,956
$0.001
-
$0.068
304,095
-
308,785
Less: Transaction costs arising on share issues
612,880
(42,832)
30 June 2019
Balance
34,815,204
40,895,357
1 At the Company’s Annual General Meeting held on 30 November 2018, the shareholders agreed to consolidate the capital in the
company on the basis that every 115 shares be consolidated into 1 share, and where the consolidation results in a fraction of a
share being held, the fraction is rounded up to the nearest whole share. The consolidation of capital was completed on 10
December 2018 reducing the number of ordinary shares on issue by 3,451,122,692 to 30,274,248 ordinary shares on issue.
(c) Ordinary shares
Ordinary shares entitle the holder to participate in dividends and the proceeds on winding up of the Company in proportion to
the number of and amounts paid on the shares held.
At shareholders' meetings, on a show of hands every holder of ordinary shares present in person or by proxy is entitled to one
vote, and upon a poll each share is entitled to one vote.
Ordinary shares have no par value and the Company does not have a limited amount of authorised capital.
(d) Options and rights
There were no options and rights issued during the 2018 and 2019 year in relation to the Maximus Resources Limited
Employee Share Option and Incentive Rights Plans.
Page 32
Maximus Resources Limited
Notes to the consolidated Financial Statements
30 June 2019
(e) Capital risk management
The Company has no debt which has externally imposed capital requirements.
The Company's debt and capital includes ordinary share capital, supported by property, plant and equipment.
Management effectively manages the Company's capital by assessing its financial risks and adjusting its capital structure in
response to changes in these risks and in the market. These responses include the management of debt levels, distributions to
shareholders and share issues.
18. Retained losses
Retained Earnings
Balance 1 July
Net loss for the year
Balance 30 June
19. Key management personnel disclosures
Key management personnel compensation
Short-term employee benefits
Post-employment benefits
Termination benefits
Consolidated
30 June
2019
$
30 June
2018
$
(37,820,319)
(2,107,283)
(36,409,475)
(1,410,844)
(39,927,602)
(37,820,319)
Consolidated
30 June
2019
$
30 June
2018
$
444,833
30,132
-
269,908
47,087
-
474,965
316,995
Detailed remuneration disclosures and interests held by key management personnel are provided in sections A to E of the
remuneration report on pages 7 to 11.
Page 33
Maximus Resources Limited
Notes to the consolidated Financial Statements
30 June 2019
20. Remuneration of auditors
During the year the following fees were paid or payable for services provided by the auditor of the Company and its related
practices:
Grant Thornton
Audit and review of financial reports
Taxation Services
Total auditors' remuneration
21. Contingencies
(a) Contingent liabilities
Consolidated
30 June
2019
$
54,936
5,400
60,336
30 June
2018
$
43,500
6,000
49,500
The Group is currently undertaking an arbitration process to determine the final amount payable for a recovered gold
reconciliation relating to the Burbanks operations. The financial accounts provide for an amount payable based on the Groups
understanding of the GIC reconciled, however this amount may vary depending on the outcome of the arbitration process.
The Group had no other known contingent liabilities as at 30 June 2019 (2018: $NIL).
(b) Contingent assets
The Group has submitted an insurance claim in relation to plant failure at the Burbanks processing facility. The financial
accounts make no allowance for an amount that may be recovered from the insurers.
The majority of the Adelaide Hills tenement package consisting of 5 tenements, including the Bird in Hand project was sold to
Terramin Australia Limited (“Terramin”) in 2013. The consideration included the following contingent payment from Terramin:
•
•
$1,000,000 payable upon approval of a Program for Environmental Protection and Rehabilitation; and
$1,000,000 payable upon commencement of bullion production.
Maximus is also entitled to a 0.5% royalty payable upon bullion production in excess of 50,000 ozs.
The Flushing Meadows tenement package was sold to Orex Mining Pty Ltd (now Yandal Resources Ltd) in October 2010.
Maximus is entitled to a gold royalty in respect of gold produced from any part of the tenement area of $40 per ounce on the
first 50,000 ounces of gold generated, with the first $200,000 to be pre-paid upon commencement of gold production and $20
per ounce of gold produced in excess of 50,000 ounces and less than 150,000 ounces to a maximum of $4 million royalty
revenue being received by Maximus.
Additionally, there is a 3% net smelter return for any gold by-products or co-products from the tenement area.
22. Commitments
Commitments for exploration and joint venture expenditure
In order to maintain current rights of tenure to exploration tenements the Company will be required to outlay in the year ending
30 June 2019 amounts of approximately $1,176,740 (2018: $1,299,020) in respect of tenement lease rentals and to meet
minimum expenditure requirements pursuant to various joint venture requirements.
Operating Leases
The Group has no operating leases at 30 June 2019.
Page 34
Maximus Resources Limited
Notes to the consolidated Financial Statements
30 June 2019
23. Key management personnel
(a) Key management personnel
Disclosures relating to key management personnel are set out in note 19.
(b) Transactions with key management personnel
The following transactions occurred with related parties:
During the year ended 30 June 2019, McClusky & Co Pty Ltd, of which Ms Leigh McCluksy is a director provided office space
for the head office. The amount paid for office and rental costs totalled $15,400 including GST. The office space is leased on
a month to month basis.
During the year ended 30 June 2018, Mandurang Pty Ltd, of which the late Mr Robert Kennedy was a Director of, loaned the
Company $50,000. The loan is interest bearing at 6%pa and is required to be repaid upon completion of a successful capital
raise. Interest has been capitalised into the total loan payable.
During the year ended 30 June 2018, Mrs G Malaxos, spouse of Mr Kevin Malaxos, loaned the Company $40,000. The loan is
interest bearing at 6%pa and is required to be repaid upon completion of a successful capital raise. Interest has been capitalised
into the total loan payable.
Transactions between related parties are on normal commercial terms and conditions no more favourable than those available
to other parties unless otherwise stated.
24. Subsidiaries
The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in accordance
with the accounting policy described in note 1(b):
Name of entity
Country of
incorporation Class of shares
Equity holding
2018
%
2019
%
MXR Minerals Pty Ltd
Eastern Goldfields Milling Services Pty Ltd
Australia
Australia
Ordinary
Ordinary
100
100
100
100
Page 35
Maximus Resources Limited
Notes to the consolidated Financial Statements
30 June 2019
25. Events occurring after the reporting period
During September 2019 the Company terminated the sale agreement with Adaman Resources Limited and entered
into an agreement with Mineral Ventures Pty Ltd sell 100% of the Burbanks Mill for $5.2 million (GST exclusive).
The Company received $2.8 million on 13 September 2019 from Mineral Ventures Pty Ltd. The Company received
the balance of $2.4 million on 30 September 2019.
Ms Leigh McClusky resigned as a Director on 1 August 2019.
Mr Martin Janes was appointed as a Director on 1 August 2019
Kevin Malaxos resigned with effect from 30 November 2019
There are no other events or circumstances that have occurred subsequent to the end of the reporting period that
have or will significantly affect the operations of the Group.
26. Reconciliation of profit after income tax to net cash inflow from operating activities
Loss for the year
Depreciation
Impairment of capitalised exploration expenditure
Gain on debt forgiveness
Loss on sale of financial assets
Change in operating assets and liabilities:
Decrease/(increase) in trade and other receivables
Decrease/(increase) in other operating assets
(Decrease)/increase in trade and other payables
(Decrease)/increase in provisions
Consolidated
30 June
2019
$
(2,107,283)
169,085
161,426
(712,613)
-
(23,610)
357,027
131,905
103,566
30 June
2018
$
(1,410,844)
192,857
515
-
11,099
(307,788)
(192,861)
1,550,754
112,272
Net cash (outflow)/inflow from operating activities
(1,920,497)
(43,996)
27. Earnings per share
(a) Basic earnings per share
30 June
2019
30 June
2018
Loss from continuing operations attributable to the ordinary equity holders
Loss from discontinued operations attributable to the ordinary equity holders
(401,733)
(1,705,550)
(449,482)
(961,362)
Weighted average number of ordinary shares outstanding during the year used to
calculate basic earnings per share
29,197,915
3,022,663,133
Basic earnings per share (cents) – continuing operations
Basic earnings per share (cents) – discontinued operations
Total Basic earnings per share (cents)
(b) Diluted earnings per share
Pursuant to AASB 133, the Company has no diluted securities.
(1.38)
(5.84)
(7.22)
(0.015)
(0.032)
(0.047)
Page 36
Maximus Resources Limited
Notes to the consolidated Financial Statements
30 June 2019
28. Share-based payments
(a) Employee Option Plan
No option arrangements existed at 30 June 2019:
Fair value of options granted
No employee options were granted during the year ended 30 June 2019 (2018: Nil). Therefore no calculation of the fair value
of options granted during the year was required to be made using the Black-Scholes option pricing model.
(b) Employee Incentive Rights Plan
No incentive rights arrangements existed at 30 June 2019 and 2018.
29. Parent Entity
Statement of financial position
Current Assets
Non-current Assets
Total Assets
Current Liabilities
Non-Current Liabilities
Total Liabilities
Net Assets
Shareholder’s Equity
Contributed Equity
Retained Losses
Capital and reserves attributable to owners
Statement of profit or loss and other comprehensive income
Loss for the year
Other comprehensive income
Total comprehensive income
Parent
2019
2018
$
42,335
4,511,465
$
13,682
4,634,460
4,553,800
4,648,142
3,585,000
1,045
1,142,107
1,001,045
3,586,045
2,143,152
967,755
2,504,990
40,895,358
(39,927,603)
40,325,309
(37,820,319)
967,755
2,504,990
(2,107,284)
(998,276)
-
(2,107,284)
(998,276)
Page 37
Maximus Resources Limited
Notes to the consolidated Financial Statements
30 June 2019
Parent Entity Contingencies
Contingent liabilities
The parent entity had no known contingent liabilities as at 30 June 2019 (2018: $NIL).
Contingent assets
The majority of the Adelaide Hills tenement package consisting of 5 tenements, including the Bird in Hand project was sold to
Terramin Australia Limited (“Terramin”) in 2013. The consideration included the following contingent payment from Terramin:
•
•
$1,000,000 payable upon approval of a Program for Environmental Protection and Rehabilitation; and
$1,000,000 payable upon commencement of bullion production.
Maximus is also entitled to a 0.5% royalty payable upon bullion production in excess of 50,000 ozs.
The Flushing Meadows tenement package was sold to Orex Mining Pty Ltd (now Yandal Resources Ltd) in October 2010.
Maximus is entitled to a gold royalty in respect of gold produced from any part of the tenement area of $40 per ounce on the
first 50,000 ounces of gold generated, with the first $200,000 to be pre-paid upon commencement of gold production and $20
per ounce of gold produced in excess of 50,000 ounces and less than 150,000 ounces to a maximum of $4 million royalty
revenue being received by Maximus.
Additionally, there is a 3% net smelter return for any gold by-products or co-products from the tenement area.
Parent Entity Commitments
(a) Commitments for exploration and joint venture expenditure
In order to maintain current rights of tenure to exploration tenements, the Company will be required to outlay in the year ending
30 June 2019 amounts of approximately $698,820 (2018: $698,820) in respect of tenement lease rentals and to meet minimum
expenditure requirements pursuant to various joint venture requirements for the next 12 months.
Page 38
In the directors' opinion:
Maximus Resources Limited
Directors' declaration
30 June 2019
(a)
the consolidated financial statements and notes set out on pages 13 to 38 are in accordance with the Corporations
Act 2001, including:
(i)
complying with Accounting Standards, the Corporations Regulations 2001 and other mandatory professional
reporting requirements, and
giving a true and fair view of the consolidated entity's financial position as at 30 June 2019 and of their
performance for the financial year ended on that date, and
(ii)
(b)
(c)
there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due
and payable, and
the financial statements comply with International Financial Reporting Standards as confirmed in note 1(a).
The directors have been given the declarations by the Managing Director and Company Secretary required by section 295A of
the Corporations Act 2001.
This declaration is made in accordance with a resolution of the directors.
Gerard Anderson
Director
Adelaide
30 September 2019
Page 39
Grant Thornton Audit
Grant Thornton House
Level 3
170 Frome Street
Adelaide SA 5000
GPO Box 1270
Adelaide SA 5001
T +61 88372 6666
Independent Auditor’s Report
To the Members of Maximus Resources Limited
Report on the audit of the financial report
Opinion
We have audited the financial report of Maximus Resources Limited (the Company) and its subsidiaries (the Group),
which comprises the consolidated statement of financial position as at 30 June 2019, the consolidated statement of profit
or loss and other comprehensive income, consolidated statement of changes in equity and consolidated statement of cash
flows for the year then ended, and notes to the consolidated financial statements, including a summary of significant
accounting policies, and the Directors’ declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act 2001, including:
a giving a true and fair view of the Group’s financial position as at 30 June 2019 and of its performance for the year
ended on that date; and
b complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are
further described in the Auditor’s Responsibilities for the Audit of the Financial Report section of our report. We are
independent of the Group in accordance with the auditor independence requirements of the Corporations Act 2001 and
the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for
Professional Accountants (the Code) that are relevant to our audit of the financial report in Australia. We have also fulfilled
our other ethical responsibilities in accordance with the Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Grant Thornton Audit Pty Ltd ACN 130 913 594
a subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389
www.grantthornton.com.au
‘Grant Thornton’ refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory services to their clients
and/or refers to one or more member firms, as the context requires. Grant Thornton Australia Ltd is a member firm of Grant Thornton International
Ltd (GTIL). GTIL and the member firms are not a worldwide partnership. GTIL and each member firm is a separate legal entity. Services are
delivered by the member firms. GTIL does not provide services to clients. GTIL and its member firms are not agents of, and do not obligate one
another and are not liable for one another’s acts or omissions. In the Australian context only, the use of the term ‘Grant Thornton’ may refer to
Grant Thornton Australia Limited ABN 41 127 556 389 and its Australian subsidiaries and related entities. GTIL is not an Australian related entity to
Grant Thornton Australia Limited.
Liability limited by a scheme approved under Professional Standards Legislation.
Material uncertainty related to going concern
We draw attention to Note 1(a) in the financial statements, which indicates that the Group incurred a net loss of $2,107,283
(continuing and discontinued) during the year ended 30 June 2019, and total cash outflows from operating and investing
activities were $2,188,189. As stated in Note 1(a), these events or conditions, along with other matters as set forth in Note
1(a), indicate that a material uncertainty exists that may cast doubt on the Group’s ability to continue as a going concern. Our
opinion is not modified in respect of this matter.
Key audit matters
Key audit matters are those matters that, in our professional 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 related to going concern section, we have determined the
matters described below to be the key audit matters to be communicated in our report.
Key audit matter
How our audit addressed the key audit matter
Discounted operations – Notes 1(r), 1(s) & 10
During the year the Group announced the sale of the assets
and milling operations associated with the Burbank Mill.
The audit of the accounting associated with this planned
disposal, in particular the assessment of fair value of assets
and liabilities included in the disposal group and presentation
of discontinued versus continuing operations in the statement
of profit and loss, is a key audit matter due to the quantum
and scale of the disposal group.
We focused on the areas where additional complexity exists in
the measurement and accounting for the disposals including:
the restatement of financial information into continuing
and discontinued operations;
determining the assets and liabilities to be included in the
disposal group.
Exploration and evaluation assets - Notes 1(n) & 12
At 30 June 2019 the carrying value of exploration and
evaluation assets was $2,775,089.
In accordance with AASB 6 Exploration for and Evaluation of
Mineral Resources, the Group is required to assess at each
reporting date if there are any triggers for impairment which
may suggest the carrying value is in excess of the recoverable
value.
The process undertaken by management to assess whether
there are any impairment triggers in each area of interest
involves an element of management judgement.
This area is a key audit matter due to the significant
judgement involved in determining the existence of
impairment triggers.
Our procedures included, amongst others:
reading the transaction documents to understand the
terms and conditions of the sale;
assessing the identification of assets and liabilities to be
disposed of, comparing to transaction documents and
underlying financial records at reporting date;
reviewing the proposed consideration receivable for the
disposal group to ensure that the assets net of liabilities
are not held at an amount above the recoverable amount;
assessing the disclosure in the financial report relating to
the planned disposal, including restatement of prior period
information to the reflect the impact of the disposal, against
the requirements of the accounting standards.
Our procedures included, amongst others:
obtaining the management reconciliation of capitalised
exploration and evaluation expenditure and agreeing to the
general ledger;
reviewing management’s area of interest considerations
against AASB 6;
conducting a detailed review of management’s
assessment of trigger events prepared in accordance with
AASB 6 including;
tracing projects to statutory registers, exploration
licenses and third party confirmations to determine
whether a right of tenure existed;
Key audit matter
How our audit addressed the key audit matter
Exploration and evaluation assets - Notes 1(n) & 12 (Cont)
enquiry of management regarding their intentions to
carry out exploration and evaluation activity in the
relevant exploration area, including review of
management’s budgeted expenditure;
understanding whether any data exists to suggest that
the carrying value of these exploration and evaluation
assets are unlikely to be recovered through
development or sale;
assessing the accuracy of impairment recorded for the
year as it pertained to exploration interests;
evaluating the competence, capabilities and objectivity of
management’s experts in the evaluation of potential
impairment triggers; and
assessing the appropriateness of the related financial
statement disclosures.
Information other than the financial report and auditor’s report thereon
The Directors are responsible for the other information. The other information comprises the information included in the
Group’s annual report for the year ended 30 June 2019, but does not include the financial report and our auditor’s report
thereon.
Our opinion on the financial report does not cover the other information and we do not express any form of assurance
conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information and, in doing so, consider
whether the other information is materially inconsistent with the financial report or our knowledge obtained in the audit or
otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are
required to report that fact. We have nothing to report in this regard.
Responsibilities of the Directors’ for the financial report
The Directors of the Company are responsible for the preparation of the financial report that gives a true and fair view in
accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the Directors
determine is necessary to enable the preparation of the financial report that gives a true and fair view and is free from material
misstatement, whether due to fraud or error.
In preparing the financial report, the Directors are responsible for assessing the 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 Company/Group or to cease operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material
misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance
is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian Auditing
Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions
of users taken on the basis of this financial report.
A further description of our responsibilities for the audit of the financial report is located at the Auditing and Assurance
Standards Board website at: http://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 the Directors’ report for the year ended 30 June 2019.
In our opinion, the Remuneration Report of Maximus Resources Limited, for the year ended 30 June 2019 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.
Grant Thornton Audit Pty Ltd
Chartered Accountants
J L Humphrey
Partner – Audit & Assurance
Adelaide 30 September 2019
Maximus Resources Limited
ASX Additional Information
The shareholder information set out below was applicable as at 15 October 2019.
A Distribution of equity securities
Analysis of numbers of equity security holders by size of holding:
ORDINARY SHARES
Range
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 - 9,999,999,999
Rounding
Total
Total holders
1,230
600
231
318
50
Units
276,394
1,566,476
1,765,002
10,042,144
21,165,188
% of Issued Capital
0.79
4.50
5.07
28.84
60.79
-0.01
2,429
34,815,204
100.00
There were 1,932 holders of less than a marketable parcel of ordinary shares. At a share price of
$0.065, an unmarketable parcel is 7,693 shares.
B Equity Security Holders
Twenty largest quoted equity security holders
The names of the twenty largest equity holders of quotes securities are listed below:
Rank Name
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
KESLI CHEMICALS PTY LTD
RAW ORE PTY LTD
MR NICHOLAS BARADAKIS
TYSON RESOURCES PTY LTD
MR DARRYN ANTHONY
GUINA NOMINEES PTY LTD
MRS GWENDOLINE MALAXOS
REBO NOMINEES PTY LTD
JORAC PTY LTD
MR GEORGE ALEXANDER BONNEY
TLG TRADING PTY LTD
MR STEPHEN RONALD O'KEEFFE
RMK SUPER PTY LTD
TRIPLE EIGHT GOLD PTY LTD
KENNY INVESTMENTS PTY LTD
MR KELVIN GLEN CROSBY + MRS BEVERLEY ANNE
CROSBY
17. WILLING VALE PTY LTD
18.
19.
20.
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
MR ALISTAIR MARK CAMERON
GIRGIS NOMINEES (WA) PTY LTD
Totals: Top 20 holders of ORDINARY FULLY PAID SHARES (TOTAL)
Total Remaining Holders Balance
Units
2,998,238
2,644,305
1,130,435
1,092,213
1,010,000
800,000
781,718
647,366
641,305
550,000
469,566
423,977
376,318
375,857
363,479
350,000
350,000
334,384
320,870
300,000
15,960,031
18,855,173
% of Units
8.61
7.60
3.25
3.14
2.90
2.30
2.25
1.86
1.84
1.58
1.35
1.22
1.08
1.08
1.04
1.01
1.01
0.96
0.92
0.86
45.84
54.16
Maximus Resources Limited
ASX Additional Information
C Substantial holders
As at 15 October 2019 the following were substantial shareholders:
Shareholder
Michael Ruane
Raw Ore Pty Ltd
Total shareholders who own more than 5%
Units
4,090,451
2,644,305
6,734,756
% of Units
11.75
7.60
19.35
D Voting Rights
The voting rights attaching to each class of equity securities are set out below:
Ordinary Shares
On a show of hands every member present at a meeting in person or by proxy shall have one vote and
upon a poll each share shall have once vote.