ABN 51 127 297 170
Metal Bank Limited
and its controlled entities
Annual Financial Report
For the year ended
30 June 2020
METAL BANK LIMITED AND ITS CONTROLLED ENTITIES
CONTENTS
Letter from the Chair
Review of Operations
Corporate Governance
Directors’ Report
Auditor’s Independence Declaration
Consolidated Statement of Profit or Loss and Other Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Notes to the Financial Statements
Director’s Declaration
Independent Audit Report to the Members of Metal Bank Limited
Additional Information for Listed Companies
Corporate Directory
1
2 – 12
13
14 – 20
21
22
23
24
25
26 – 45
46
47 – 50
51 – 53
54
METAL BANK LIMITED AND ITS CONTROLLED ENTITIES
LETTER FROM THE CHAIR
Dear Shareholder
On behalf of the Directors of Metal Bank Limited (Metal Bank, MBK or the Company), I am pleased to report on
the activities of the Company for the year ended 30 June 2020. Our exploration activities have focussed on the
8 Mile and Eidsvold projects which have been significantly advanced during the year.
The 8 Mile project, located 18km along strike from the 2Moz Mt Rawdon goldmine, has moved from a discovery
to an advanced gold project. Our initial drilling intersected extensive gold mineralisation on two prospects and
then confirmed a maiden inferred Mineral Resource and Exploration Target at Flori’s Find. With grade and widths
increasing at depth and with indications that we are getting closer to the potential bulk tonnage target, we are
excited with the prospects in the year ahead.
At the Eidsvold Project we defined a highly prospective drill ready gold target applying the latest 3D geophysical
modelling techniques. We have modelled a 7 km2 alteration system interpreted as a very large intrusion related
gold (IRG) system at the Great Eastern target with geophysical responses similar to the 3 Moz Mt Leyshon gold
deposit. The Great Eastern target now presents a new opportunity to drill an untested large-scale gold target
within a proven region of multi-million ounce IRG deposits.
With our focus on 8 Mile and Eidsvold, MBK had been seeking a joint venture partner since 2018 to further fund
exploration for the Triumph project. Early in the new financial year the Company granted an option to an
unrelated private group to acquire the Triumph project for a total potential consideration of up to $6.4 million
and a 1% royalty. That sale has now settled providing the Company with additional cash to fund its exploration
projects.
The Company has recently been successful in raising approximately $2.11 million through a placement and an
entitlement offer both of which closed oversubscribed with strong support from new sophisticated and
professional investors and existing shareholders. These funds have now enabled us to develop an exploration
strategy aimed at achieving step change development advances at both 8 Mile and Eidsvold. At 8 Mile we are
focussed on a bulk tonnage discovery and at Eidsvold we are aiming to demonstrate that the Great Eastern Target
is a new large IRG system. Work on the ground has commenced and we look forward to moving both these
projects to the next level.
Sue-Ann Higgins, who has significant experience in the mining industry, joined the Board in early calendar 2020,
following the resignation of Anthony Schreck. The exploration programmes are now ably led by Trevor Wright, a
geologist with many years’ experience on MBK projects.
With our exploration programmes being based in Queensland we have not experienced any disruption as a result
of COVID-19. However, the health and safety of our team and contractors remains paramount and the Company
continues to practice strict protocols to minimise any potential risks.
We look forward to continued exploration success in the year ahead and we thank our shareholders for their
ongoing support.
Inés Scotland
Non-executive Chair
29 September 2020
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METAL BANK LIMITED AND ITS CONTROLLED ENTITIES
REVIEW OF OPERATIONS
REVIEW OF OPERATIONS
Highlights
8 Mile Project Advanced Exploration Project
Moved from discovery to an advanced project with a maiden Inferred
Resource and Exploration Target1 and close to a potential bulk
tonnage target
Eidsvold
Drill ready opportunity
3D Modelling of geophysical data beneath surface geochemical
anomalies at the Great Eastern Target identifies a drill ready, 7 km2
large-scale intrusion related gold target
Corporate
Triumph sale
In July 2020, MBK announced the sale of its Triumph tenements for a
total potential consideration of $6.4 million plus a 1% gross royalty
Capital Raising $2.11 million raised
A placement and entitlement offer were completed following the end
of the year raising over $2.11 million
Big Gold in Southeast Queensland
Metal Bank holds two high quality large-scale gold projects, 100% owned by Roar Resources Pty Ltd, a wholly
owned subsidiary of the Company. Both projects have multi-million-ounce potential in a region that hosts
several gold mines including the Cracow (3Moz Au) and Mt Rawdon (2Moz Au) gold mines as well as the
historical Mt Morgan deposit (8Moz Au). Refer to Figure 1.
The 8 Mile project is located near the Mt Rawdon gold deposit in south-east Queensland. Multiple large-scale
targets have been identified along >3.6km mineralized corridor at the Eastern Target, including a maiden
Inferred Mineral Resource and Exploration Target1 at the Flori’s Find Prospect. The Western Target and
northern extensions of the Eastern Target remain untested.
The Eidsvold project presents a drill ready 7km2 opportunity at its Great Eastern Target of a similar scale and
geophysical response to the 3 M oz Au Mt Leyshon deposit and close to the Eidsvold historical goldfield of
100,000oz Au historical production.
1 MBK ASX Release dated 23 April 2020
2
METAL BANK LIMITED AND ITS CONTROLLED ENTITIES
REVIEW OF OPERATIONS
Figure 1: Location of MBK gold projects in South East Queensland, Australia
The operations of the Company during the financial year are as described below:
8 Mile Project – Advanced Gold Project
The 8 Mile project (centred on the Perry goldfield) represents a large hydrothermal mineral system near the
2 Moz Mt Rawdon gold mine.
Mineralisation at the Eastern Target of the 8 Mile project is focused along a >3.6km long structural corridor
which hosts the Perry prospect in the north and Flori’s Find prospect in the south. Refer to Figure 2.
Exploration activities during the year have seen the 8 Mile project move from drill discovery, to confirmation
of an emerging gold system, through to an advanced gold project with an Inferred Mineral Resource and
significant Exploration Target2.
Drill programs in October 20193 confirmed the emergence of a large gold system at the 8 Mile Project with
the following significant results:
Flori’s Find Prospect
-
Results from a single step back hole included: 16m @ 1.9g/t Au from 69m (true width) and confirmed
a westerly dip with mineralised intrusives extending more that 220m down dip with strike potential
over 800m.
- Historical mine dump rock sample of 15% Cu, 37g/t Ag, 0.35g/t Au highlights possible leakage above
a new target zone.
Perry Prospect
-
Broad gold zones forming a part of the outer halo of the intrusion related gold system were
intersected with results including:
o 6m @ 1.0g/t Au from 105m (within 31m @ 0.4g/t Au from 87m)
o 3m @ 2.2g/t Au from 72m (within 23m @ 0.4g/t Au from 60m)
o 6m @ 3.4g/t Au from 4m – new target area
2 MBK ASX Release dated 23 April 2020
3 MBK ASX Release dated 1 November 2019
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METAL BANK LIMITED AND ITS CONTROLLED ENTITIES
REVIEW OF OPERATIONS
Data supports gold mineralised intrusives at both Flori’s Find and Perry prospects are linked. They both lie
within the same >3.6km long structural corridor defined by surface geochemistry which is typical of intrusion
related gold systems and with ore geometries both dipping towards the west at 30 to 40 degrees.
Figure 2: Eastern target at 8 Mile Project showing > 3.6km structural corridor hosting the Perry and Flori’s
Find prospects.
4
METAL BANK LIMITED AND ITS CONTROLLED ENTITIES
REVIEW OF OPERATIONS
The Company followed this drilling with identification of a near surface maiden Inferred Mineral Resource of
195,000t @ 2.4g/t Au at the Flori’s Find prospect forming the basis for an Exploration Target of 3.6 to 5.1 Mt
grading between 1.60 - 2.14 g/t Au for a total of 180,000 to 355,000 oz Au using a nominal 1 g/t Au cut-off
and limited to approximately 120m below surface.4 Refer to Figure 3 and Figure 4.
The maiden Inferred Mineral Resource and Exploration Target are in addition to the previously identified
potential bulk tonnage target to the immediate west of the limited drilling to date.
The Exploration Target is an extrapolation along strike of the same structure of the maiden Inferred Mineral
Resource. Strike extension is indicated by geology, geophysics, historical drilling and soil geochemical
anomalies.
Figure 3: Flori’s Find prospect plan view of Inferred mineral resource and Exploration target.
4 MBK ASX Release dated 23 April 2020
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METAL BANK LIMITED AND ITS CONTROLLED ENTITIES
REVIEW OF OPERATIONS
The Exploration Target does not include the potential for a large bulk mineable deposit within an intrusion,
interpreted as the source of the gold mineralisation, located approximately 200 m further west and <200 m
from surface. Further, no consideration has been given to any potential for linking together with the Perry
prospect located approximately 2 km to the north.
A six hole reverse circulation drilling program completed in June 20205 at Flori’s Find down dip and along
strike of the maiden Inferred Mineral Resource demonstrated down dip and strike extensions to the Inferred
Mineral Resource and in support of the Exploration Target. Drill-hole ETRC022 returned 6m @ 2.52 g/t Au
from 140m, intersecting mineralisation 75m down-dip from previous drilling of 16m @ 1.96 g/t Au from 69m
in ETRC020.. Refer to Figure 4.
Figure 4: Flori’s Find prospect cross section of significant drill results.
Mineralisation remains open down-dip and northeast along strike for at least 250m and is now interpreted
to be much closer to a potential bulk tonnage intrusion source than previously recognised. This is due to the
strong correlation between gold mineralisation and broad zones of anomalous molybdenum in a number of
drill-holes. The bulk tonnage target zone is defined by an induced polarisation (IP) anomaly directly down
dip to the west of drilling at Flori’s Find and also beneath a historical Cu-Ag-Au mine where rockchip mine
dump sampling by MBK returned up to 15% Cu. Mineralisation at the mine is interpreted to be leakage
directly above the bulk tonnage target.
Flori’s Find Inferred Mineral Resource
In April 20204, Metal Bank reported a maiden Inferred Mineral Resource of 195 Kt at 2.4 g/t Au for the cut-
off grade of 1 g/t and a 15,070 contained oz Au for the Flori’s Find prospect:
The Inferred Mineral Resources were reported under JORC (2012) at both 0.5 g/t Au and 1.0 g/t Au cut-off in
Table 1.
Table 1. Inferred Mineral Resource Statement, Flori’s Find deposit, 8 Mile Project.
Cut-off Au g/t
0.5
1.0
Tonnes
310,000
195,000
Grade Au g/t
Gold Ounces
1.82
2.40
18,000
15,000
5 MBK ASX Release dated 6 July 2020
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METAL BANK LIMITED AND ITS CONTROLLED ENTITIES
REVIEW OF OPERATIONS
Key points are as follows:
The maiden Inferred Mineral Resource was estimated over the initial drilling area comprising seven
drill holes located on a single section and where continuity of the mineralisation is demonstrated
within a single structure.
A simple polygonal estimation method was used with a maximum down dip and strike extrapolation
of 30m.
The available data suggests increasing gold grade with depth and a shallow 30° dip of the
mineralisation.
On section continuity of the shallow dipping structure includes drilling separation of between 30 and
100 m. Inferred classification is considered suitable for the current drill spacing and extrapolation
that is limited to 30 m.
Polygons and drilling intercepts are based on a 1 g/t Au cut-off grade and a minimum down hole
thickness of 2 m.
The mineralisation is interpreted to be a generally planar shallow dipping zone that is consistent with
Placer drilling ore geometry defined along 140 m strike length, geophysical gradient array IP and soil
geochemical strike orientations.
The Mineral Resource forms the basis for the Flori’s Find Exploration Target.
Flori’s Find Exploration Target
An additional Exploration Target has been defined in the upper leakage zone of the Flori’s Find Project of 3.6
Mt to 5.1 Mt grading 1.6 to 2.1 g/t Au for a total of 180,000 to 355,000 contained oz Au using a nominal 1 g/t
Au cut-off and limited to approximately 120m below surface.
Though based on extrapolating the Inferred Mineral Resource and extent of surface soil anomalies, it should
be noted that the potential quantity and grade of the Exploration Target is conceptual in nature. There is no
reliable drilling information beyond the initial drill section completed in 2019 sufficient to estimate a Mineral
Resource over the Exploration Target area and it is uncertain if further exploration will result in the estimation
of a Mineral Resource over this area.
The Exploration Target is based on extrapolation of the Inferred Mineral Resource along strike to the extent
of the main gold anomaly in soil geochemistry and down dip to a depth of 120 m below surface, which is
considered an appropriate maximum depth for an open pit scenario.
The current Fori’s Find geochemical anomaly in soils of >600 m in strike length has been used for the
Exploration Target to estimate the range of tonnage and grade. It is based on upper and lower case scenarios
including 450 m to 700 m strike extent and potential variations in potential grade.
8 Mile Project Next Steps
Since the end of the financial year, MBK has been pursuing further exploration programs at 8 Mile based on
a two-phase exploration strategy.
The objective of the first phase of the exploration program is to make a bulk tonnage discovery at Flori’s Find
prospect. An IP survey has been completed and drilling is scheduled to commence in September.
Depending on the results of the first phase, the second phase of exploration is scheduled to commence in
early 2021. This phase will focus on expansion drilling on the bulk tonnage target and infill drilling aimed at
converting the Exploration Target to a resource and demonstrating that mineralization at Perry prospect
continues south towards Flori’s Find.
7
METAL BANK LIMITED AND ITS CONTROLLED ENTITIES
REVIEW OF OPERATIONS
Eidsvold Project – Drill Ready Opportunity
MBK’s Eidsvold Project is located within a region of proven multi-million ounce intrusion related gold
deposits, including the Eidsvold Goldfield (100,000 oz Au historical production).
The Great Eastern Target offers a drill ready opportunity to test a highly prospective 7km2 target6, which is of
a similar scale and geophysical response as the 3 Moz Mt Leyshon deposit. Refer to Figure 5.
Figure 5: Great Eastern Target location of the resistivity low and coincident surface geochemistry with
respect to the core.
6 MBK ASX Release dated 5 May 2020
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METAL BANK LIMITED AND ITS CONTROLLED ENTITIES
REVIEW OF OPERATIONS
Geophysical and geochemical surface studies are completed and The Great Eastern Target is now a genuine
drill ready opportunity within a highly prospective area as attested to by the nearby presence of a 100,000
oz Au historical goldfield.
MBK completed an airborne electromagnetic EM survey in 2018 to obtain resistivity data over the Eidsvold
project and combined this data with airborne magnetics to identify multiple large-scale geophysical targets.
In 2019, MBK completed geochemical ultra-trace soil sampling and pH analysis across the highest priority of
these targets to confirm geochemical signatures typical of IRG systems. A low pH response with elevated
pathfinder geochemistry is direct evidence for weathering out of sulphides (producing acidic conditions) in
the sediment immediately above the alteration zone of an IRG system.
The Great Eastern Target was identified as the highest priority target at the Eidsvold Project due to the large
7 km2 geophysical anomaly coincident with elevated pathfinder geochemistry, including ±Au-Ag-Sn-Te-Bi-
(Mo-Zn-Hg-As-Cu-Sb-Pb), and a substantial drop in pH levels.
The success of the surface geochemistry program led MBK to engage a leading industry consultant specialising
in geophysical targeting of IRG systems in Queensland, to produce a 3D model of the 7 km² alteration system.
The resulting model is interpreted as a potentially very large IRG overlain by 50 – 100 m of sediment.
The geophysical responses are of the same scale and very similar to those at the 3 Moz Mt Leyshon gold
deposit. At both Mt Leyshon and the Great Eastern Target, broad resistivity lows occur on top of and at the
sides of a deep reverse polarised core.
Figure 6: Location of the Great Eastern Target and satellite target areas.
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METAL BANK LIMITED AND ITS CONTROLLED ENTITIES
REVIEW OF OPERATIONS
At Mt Leyshon, the low resistivity reflects gold mineralisation within overprinting alteration surrounding the
early hot intrusive phase defined by a deep reversely magnetised core. It appears the same process has
occurred at the Great Eastern Target where significant soil geochemistry results are coincident with the low
resistivity response around the core. Refer to Figure 5 for the location of the resistivity low and coincident
surface geochemistry with respect to the core. The Great Eastern Target is considered to be the likely source
of gold mineralising fluids 6 km to the southwest of the historical Eidsvold goldfield and the Mt Brady
historical workings 5 km to the northwest, where MBK intersected up to 1 m @ 17.4 g/t Au in scout drilling7.
Refer to Figure for the location of the Great Eastern Target and satellite target areas.
Eidsvold Project Next Steps
As with 8 Mile, since the end of the financial year, MBK has been pursuing further exploration programs at
the Eidsvold Project based on a two-phase exploration strategy.
The first phase of the exploration program has been designed to investigate the Great Eastern Target as a
new, large IRG system. The initial drill testing will include two drill holes of up to 250m each which are fully
funded by the Queensland Government under the latest round of the Collaborative Exploration Initiative.
Additional surface evaluation has commenced at both Tower Hill and Forty Horse prospects in preparation
for drilling. Infill surface geochemical sampling has been completed with assay results awaited and an IP
survey is scheduled to commence in mid-September. The results of these studies will assist in refining drilling
locations, with drilling scheduled for October 2020.
Subject to the results of the first phase, the second phase of exploration at Eidsvold will commence in early
2021. The aim is to continue investigating the Great Eastern Target in addition to providing evidence of the
Eidsvold Intrusive Complex hosting additional gold systems at Forty Horse and Tower Hill prospects, similar
to the historical high-grade Eidsvold goldfield.
Triumph Project
The Triumph Project is an intrusion-related gold camp centred about the historical high-grade Norton
goldfield (mined in the late 1800’s and again in the 1990’s) located between Mt Rawdon (2Moz Au) gold mine
and the historical Mt Morgan (8Moz Au and 0.4Mt Cu) mine in the Northern New England Orogen, south-east
Queensland.
Metal Bank’s exploration on the Triumph Project resulted in the discovery of multiple high-grade gold zones
occurring near surface and defined a large-scale gold system centred around the historical Norton goldfield.
The high-grade gold mineralisation was interpreted as leakage above bulk tonnage style gold systems similar
to other large intrusion related gold mines in Queensland with four priority bulk tonnage targets identified
<200m below surface.
Following the end of the financial year, MBK announced that it has entered into an agreement with an
unrelated private group (Purchaser) granting the Purchaser an exclusive option (exercised by the Purchaser
upon signing) (Option) to purchase the Company’s Triumph tenements for a total potential consideration of
$6.4 million plus a 1% gross royalty.
Completion of the sale of the tenements occurred in September 2020.
The total potential consideration for the disposal of the Triumph tenements of $6.4 million is equivalent to
the project’s net asset value. The 1% royalty is in addition to this potential consideration providing the
Company with exposure to the upside from the project. The disposal of the Triumph tenements also provided
cash of $400,000 to fund exploration activities on the Company’s other projects.
7 MBK ASX Release 15 April 2014
10
METAL BANK LIMITED AND ITS CONTROLLED ENTITIES
REVIEW OF OPERATIONS
Corporate
New Opportunities
During the year, the Company continued with its review and analysis of new growth opportunities, through
acquisition and corporate transactions, with the focus on advanced projects and cash-flow generating assets
that fit with its growth strategy and have the ability to add shareholder value.
Capital Raising
Following the end of the Quarter the Company announced a Placement and Entitlement Offer to raise up to
$2.11 million to fund its exploration programs at 8 Mile and Eidsvold.
The Placement raised approximately $927,000 (before costs) (Placement) through the issue of 132,429,645
shares at $0.007 per Share (Offer Price) together with a 1 for 2 free attaching option exercisable at 1.5 cents
on or before 31 March 2022 (New Option). The Entitlement Offer raised an additional $1,184,510
(Entitlement Offer) through the issue of up to 169,215,657 million shares at the Offer Price, together with a
1 for 2 free attaching New Option.
Change in Directors
During the year, Mr Anthony Schreck resigned as Managing Director. Ms Ines Scotland moved from the
position of non-executive Chair to executive Chair. Sue-Ann Higgins was appointed as an Executive Director.
Sue-Ann Higgins
Executive Director
29 September 2020
11
TENEMENT SCHEDULE AND COMPETENT PERSONS STATEMENT
METAL BANK LIMITED AND ITS CONTROLLED ENTITIES
Schedule of Tenements
Tenements
Location
Percentage Interest
Roar Resources Pty Ltd (Wholly Owned Subsidiary)
Triumph Project
EPM 18486*
EPM 19343*
Eidsvold Project
EPM 18431
EPM 18753
8 Mile Project
EPM26945
EPM – Exploration Permit
Queensland
Queensland
Queensland
Queensland
100%
100%
100%
100%
Queensland
100%
* The Triumph project tenements were sold by the Company after the end of the financial year
Competent Persons Statement
The information in this report that relates to Exploration Results, Mineral Resources and Exploration
Target statements is based on information compiled or reviewed by Mr Trevor Wright as set out in
the Company’s ASX Releases dated 7 Nov 2019, 23 April 2020 and 6 July 2020 (8 Mile) and 5 May
2020 (Eidsvold). The Company is not aware of any new information or data that materially affects
the information included in these ASX Releases and in the case of reported Mineral Resources, all
material assumptions and technical parameters underpinning the estimates continue to apply and
have not materially changed. Mr Wright is a Member of The Australasian Institute of Geoscientists
and is a contractor to the Company. Mr Wright has sufficient experience which is relevant to the
style of mineralisation and type of deposit under consideration and to the activity which he is
undertaking to qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian
Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr Wright consents
to the inclusion in the report of the matters based on his information in the form and context in
which it applies. The Exploration Targets described in this report are conceptual in nature and there
is insufficient information to establish whether further exploration will result in the determination
of Mineral Resources.
12
METAL BANK LIMITED AND ITS CONTROLLED ENTITY
CORPORATE GOVERNANCE
Metal Bank Limited (Metal Bank), recognises the need to establish and maintain corporate governance
policies and practices that reflect the requirements of the market regulators and participants, and the
expectations of members and others who deal with Metal Bank. These policies and practices remain under
constant review as the corporate governance environment and good practices evolve.
ASX Corporate Governance Principles and Recommendations
The third edition of ASX Corporate Governance Council Principles and Recommendations (the Principles) set
out recommended corporate governance practices for entities listed on the ASX.
The Company has issued a Corporate Governance Statement which discloses the Company’s corporate
governance practices and the extent to which the Company has followed the recommendations set out in the
Principles. The Corporate Governance Statement was approved by the Board on 29 September 2020 and is
available on the Company’s website: http://metalbank.com.au/corporate-governance
13
METAL BANK LIMITED AND ITS CONTROLLED ENTITY
DIRECTORS REPORT
Your directors present their report on Metal Bank Limited and its subsidiaries (Consolidated Entity or the
Group) for the year ended 30 June 2020.
DIRECTORS
The names of directors in office at any time during or since the end of the year are:
Current Directors
INĖS SCOTLAND
EXECUTIVE CHAIR
B App Sc
Ms Scotland was most recently the Managing Director and CEO of Ivanhoe
Australia, an ASX listed entity with a market capitalisation of $500m.
Prior to this Ms Scotland was the Managing Director and CEO of Citadel
Resource Group Limited. Ms Scotland was a founding shareholder of Citadel
and was its managing director through its growth, until its acquisition by
Equinox Minerals in January 2011.
At the time of acquisition by Equinox, Citadel was developing the Jabal Sayid
Copper Project in Saudi Arabia, had a market capitalisation of $1.3B and had
raised more than $380m on the equity markets.
Ms Scotland has worked in the mining industry for over 20 years for large scale
gold and copper companies in Australia, Papua New Guinea, USA and the
Middle East. This has included working for Rio Tinto companies, Comalco, Lihir
and Kennecott Utah Copper.
Appointed 13 August 2013.
SUE-ANN HIGGINS
EXECUTIVE DIRECTOR
COMPANY SECRETARY
BA LLB HONS AGIA ACG
GAICD
Ms Higgins is an experienced company executive who has worked for over
25 years in the mining industry including in senior legal and commercial roles
with ARCO Coal Australia Inc, WMC Resources Ltd, Oxiana Limited and
Citadel Resource Group Limited. Ms Higgins has extensive experience in
governance and compliance, mergers and acquisitions, equity capital
markets and mineral exploration, development and operations.
Appointed 24 February 2020.
Former directorships in the last 3 years:
Celamin Holdings Limited
GUY ROBERTSON
EXECUTIVE DIRECTOR
B Com (Hons), CA.
Mr Robertson has more than 30 years’ experience as Chief Financial Officer,
Company Secretary and Director of both public and private companies in
Australia and Hong Kong.
Previous roles included Chief Financial Officer/GM Finance of Jardine Lloyd
Thompson, Colliers International Limited and Franklins Limited.
Mr Robertson has over 10 years’ experience in ASX listed mineral exploration
companies and is currently a Director of Hastings Technology Metals Ltd.
Appointed 17 September 2012.
Other current public company directorships:
Hastings Technology Metals Ltd
Former directorships in the last 3 years:
Bellevue Gold Limited
14
Former Directors
ANTHONY SCHRECK
MANAGING DIRECTOR
B App Sc (Geol), GDipSc,
MAIG, GAICD
METAL BANK LIMITED AND ITS CONTROLLED ENTITY
DIRECTORS REPORT
Mr Schreck has more than 25 years of mineral exploration experience in
Australia and the South West Pacific region (Solomon Islands). He has managed
large exploration projects in challenging terrains for major companies including
North Flinders Mines, Normandy, Newmont, Anglo Gold Ashanti and Xstrata.
Mr Schreck is credited with the grassroots discovery of the multi-million-ounce
Twin Bonanza gold system (Buccaneer and Old Pirate gold deposits) in the
Northern Territory. He has been key in the successful startup and management
of a number of private resource companies.
Appointed 29 November 2013.
Resigned 24 February 2020.
Interest in the shares and options of the Company
As at the date of this report, the interests of the directors in the shares and options of Metal Bank Limited
were:
Inés Scotland
Sue-Ann Higgins
Guy Robertson
Anthony Schreck
Ordinary
Shares
109,112,780
71,418,589
793,334
11,735,780
Options*
Performance
Rights
88,000
6,996,778
56,667
-
-
-
-
-
*Options exercisable at $0.015 on or before 31 March 2022
SIGNIFICANT CHANGES IN STATE OF AFFAIRS
Other than as outlined in the Chairman’s report, there were no significant changes in the state of affairs of
the Company during the year.
PRINCIPAL ACTIVITIES
The principal activity of the Company during the financial year was mineral exploration. There have been no
significant changes in the nature of the Company’s principal activities during the financial year.
SIGNIFICANT AFTER BALANCE SHEET DATE EVENTS
On 16 September 2020 the Company settled the sale of the Triumph project for a consideration of up to
$6,400,000 and a 1% gross royalty based on the project achieving JORC Mineral Resource milestones.
Subsequent to year end the Company undertook a placement and an entitlement offer raising approximately
$2.11 million from the issue of 301,644,007 shares at $0.007 per share and 150,822,090 free attaching
options with an exercise price of 1.5 cents and expiry date of 31 March 2022. A further 15,000,000 options
with an exercise price 1.5 cents and an expiry date 31 March 2020 were issued to brokers to the capital raise.
Other than as outlined above, there are no matters or circumstances that have arisen since the end of the
financial period that have significantly affected or may significantly affect the operations of the consolidated
entity, the results of those operations, or the state of affairs of the consolidated entity in future financial
years.
15
METAL BANK LIMITED AND ITS CONTROLLED ENTITY
DIRECTORS REPORT
LIKELY FUTURE DEVELOPMENTS AND EXPECTED RESULTS
The primary objective of Metal Bank is to continue its exploration activities on its current exploration projects
in Australia and to continue to pursue new project opportunities as they arise.
The material business risks faced by the Company that are likely to have an effect on the financial prospects
of the Company, and how the Company manages these risks, are:
Future Capital Needs – the Company does not currently generate cash from its operations. The Company
will require further funding in order to meet its corporate expenses, continue its exploration activities and
complete studies necessary to assess the economic viability of its projects. The Company’s financial
position is monitored on a regular basis and processes put into place to ensure that fund raising activities
will be conducted in a timely manner to ensure the Company has sufficient funds to conduct its activities.
Exploration and Developments Risks – the business of exploration for gold and other minerals and their
development involves a significant degree of risk, which even a combination of experience, knowledge
and careful evaluation may not be able to overcome. To prosper, the Company depends on factors that
include successful exploration and the establishment of resources and reserves within the meaning of the
2012 JORC Code. The Company may fail to discover mineral resources on its projects and once
determined, there is a risk that the Company’s mineral deposits may not be economically viable. The
Company employs geologists and other technical specialists, and engages external consultants where
appropriate to address this risk.
Commodity Price Risk – as a Company which is focused on the exploration of gold and base and precious
metals, it is exposed to movements in the price of these commodities. The Company monitors historical
and forecast price information from a range of sources in order to inform its planning and decision making.
Title and permit risks - each permit or licence under which exploration activities can be undertaken is
issued for a specific term and carries with it work commitments and reporting obligations, as well as other
conditions requiring compliance. Consequently, the Company could lose title to, or its interests in, one
or more of its tenements if conditions are not met or if sufficient funds are not available to meet work
commitments. Any failure to comply with the work commitments or other conditions on which a permit
or tenement is held exposes the permit or tenement to forfeiture or may result in it not being renewed
as and when renewal is sought. The Company monitors compliance with its commitments and reporting
obligations using internal and external resources to mitigate this risk.
COVID-19 - The outbreak of the coronavirus disease (COVID-19) is impacting global economic markets.
The nature and extent of the effect of the outbreak on the performance of the Company remains
unknown. The Company’s Share price may be adversely affected in the short to medium term by the
economic uncertainty caused by COVID-19. Further, any governmental or industry measures taken in
response to COVID-19 may adversely impact the Company’s operations and are likely to be beyond the
control of the Company. COVID-19 safe work practices have and will continue to be adopted in relation
the Company’s operations, however, COVID-19 restrictions on movement and activities may adversely
affect the Company’s operations. The Directors are monitoring the outbreak of COVID-19 closely and
have considered the impact of COVID-19 on the Company’s business. However, the situation is continually
evolving, and the consequences are therefore inevitably uncertain.
PERFORMANCE IN RELATION TO ENVIRONMENTAL REGULATION
The consolidated entity will comply with its obligations in relation to environmental regulation on its
Queensland projects and when it undertakes exploration in the future. The Directors are not aware of any
breaches of any environmental regulations during the period covered by this report.
16
METAL BANK LIMITED AND ITS CONTROLLED ENTITY
DIRECTORS REPORT
OPERATING RESULTS AND FINANCIAL REVIEW
The loss of the consolidated entity after providing for income tax amounted to $1,331,096 (2019: loss of
$425,026).
The Group’s operating income decreased to $11,069 (2019: $41,781) and relates purely to interest on funds
at bank.
Expenses increased to $1,342,165 (2019: $466,807) following a write down in the carrying value of
exploration expenditure on the Triumph project in the amount of $878,566.
Capitalised exploration costs increased to $8,635,455 (2019: $8,804,339) reflecting the exploration work
principally on the 8 Mile project during the year and the write down of expenditure on the Triumph project.
Net assets decreased to $9,085,666 (2019: $10,416,762) due to the loss for the year.
DIVIDENDS PAID OR RECOMMENDED
The directors do not recommend the payment of a dividend and no amount has been paid or declared by
way of a dividend to the date of this report.
REMUNERATION REPORT
Remuneration Policy
The Board determines, on a case by case basis, the terms and conditions of employment of company
executives and consultants, including remuneration.
The Board’s policy for determining the nature and amount of remuneration for Board members and
executives (Remuneration Policy) is as follows:
The terms and conditions for the executive directors and other senior staff members, are developed by
the Chair and Company Secretary and approved by the Board;
Remuneration for directors and senior executives is determined and reviewed by the Board by reference
to the Company’s performance, the individual’s performance, as well as comparable information from
listed companies in similar industries;
In determining competitive remuneration rates, the Board may seek independent advice on local and
international trends among comparative companies and industry generally. It examines terms and
conditions for employee incentive schemes, benefit plans and share plans. Independent advice may be
obtained to confirm that executive remuneration is in line with market practice and is reasonable in the
context of Australian executive reward practices;
The Company is a mineral exploration company and does not generate cash from its operations. In order
to preserve cash for exploration activities, the Board has determined, where possible, to pay a base
remuneration less than market rates to its executive directors, employees and individual contractors
with base remuneration to be supplemented by performance incentives to ensure attraction, retention
and ongoing incentives for its directors and executives;
The Board determines payments to the non-executive directors and reviews their remuneration
annually, based on market practice, duties and accountability;
All remuneration paid to directors is valued at the cost to the Company and expensed. Where
appropriate, shares given to directors and executives are valued as the difference between the market
price of those shares and the amount paid by the director or executive. Options are valued using the
Black-Scholes methodology; and
17
METAL BANK LIMITED AND ITS CONTROLLED ENTITY
DIRECTORS REPORT
Issue of performance rights are subject to the terms of Metal Bank Performance Rights Plan and their
vesting is subject to vesting conditions and performance hurdles relating to the performance of both the
Company and the individual as determined and assessed by the Board.
The Company has not tabled figures for earnings and shareholders’ funds for the last five years as, being an
exploration company, these historical figures have no relevance in determining remuneration structure.
DIRECTORS' AND EXECUTIVE OFFICERS’ EMOLUMENTS –
(a) Details of Directors and Key Management Personnel
(i)
(ii)
(iii)
(iv)
Current Directors
Inés Scotland – Executive Chair (appointed 13 August 2013)
Sue-Ann Higgins – Executive Director (appointed 24 February 2020)
Guy Robertson – Executive Director (appointed 17 September 2012)
Former Directors
Anthony Schreck – Managing Director (appointed 29 November 2013; resigned 24 February 2020)
Company Secretary
Sue-Ann Higgins (appointed 21 August 2013)
Key Management Personnel
Trevor Wright - Exploration Manager (appointed 4 July 2016)
Other than the directors, the company secretary and the Exploration Manager, the Company had no Key
Management Personnel for the financial year ended 30 June 2020.
Directors’ remuneration and other terms of employment are reviewed annually by the Board having regard
to performance against goals set at the start of the year, relative comparative information and independent
expert advice, where appropriate.
Except as detailed in Notes (a) – (c) to the Remuneration Report, no director or officer has received or become
entitled to receive, during or since the financial year, a benefit because of a contract made by the Company
or a related body corporate with a director, a firm of which a director is a member or an entity in which a
director has a substantial financial interest. This statement excludes a benefit included in the aggregate
amount of emoluments received or due and receivable by directors and shown in Notes (a) – (c) to the
Remuneration Report, prepared in accordance with the Corporations Regulations, or the fixed salary of a full
time employee of the Company.
(b) Remuneration of Directors and Key Management Personnel
Remuneration Policy
The Company’s Remuneration Policy is outlined above. Remuneration of Directors of the Group and Key
Management Personnel is set out below.
Service Contracts
The Company has a service contract with the Company Secretary providing an annual fee of $92,400, and
cancellable by either party giving one months’ notice.
18
METAL BANK LIMITED AND ITS CONTROLLED ENTITY
DIRECTORS REPORT
Parent & Group Key Management Personnel
2020
I. Scotland
S. Higgins
G. Robertson
T. Wright
A. Schreck
Totals
Base
Salary
and Fees
-
92,400
50,000
154,185
228,017
524,602
Superannuation
-
-
-
-
427
427
2019
Base
Salary
and Fees
-
92,400
50,000
178,558
239,104
560,062
Total
-
92,400
50,000
154,185
228,444
525,029
Superannuation
-
-
-
-
12,746
12,746
Total
-
92,400
50,000
178,558
251,850
572,808
There are no other employment benefits, either short term, post-employment or long term, non-monetary
or otherwise other than those outlined above.
(c) Employee Related Share-based compensation
Options
No options were issued to employees or to directors or executives as part of their remuneration for the year
ended 30 June 2020.
Performance Rights
The Metal Bank Performance Rights Plan (the Rights Plan) and issue of securities under the Rights Plan was
first approved by shareholders at the Annual General Meeting of the Company held on 30 November 2012
and this approval was renewed by shareholders at the Annual General Meeting of the Company held on
30 November 2018.
To be eligible to participate in the Rights Plan, a person must be a full or part time employee, contractor or
consultant (approved by the Board) of the Company or any subsidiary of the Company or a director.
No performance rights were issued during the year and no performance rights were outstanding at the end
of the year.
The Company is an exploration company and has no revenue from sales of product. Consequently,
earnings/loss and return to shareholders over the previous five years is not an appropriate benchmark for
the determination of executive remuneration, and has not been tabled.
Remuneration report – end.
MEETINGS OF DIRECTORS
The number of directors' meetings (including committees) held during the financial period, each director who
held office during the financial period and the number of meetings attended by each director are:
Director
I. Scotland
S. Higgins
G. Robertson
A. Schreck
Directors Meetings
Meetings Attended
Number Eligible
to Attend
6
3
6
3
6
3
6
3
19
METAL BANK LIMITED AND ITS CONTROLLED ENTITY
DIRECTORS REPORT
INDEMNIFYING OFFICERS
In accordance with the constitution, except as may be prohibited by the Corporations Act 2001, every officer
or agent of the Company shall be indemnified out of the property of the Company against any liability incurred
by him or her in his or her capacity as officer or agent of the Company or any related corporation in respect
of any act or omission whatsoever and howsoever occurring or in defending any proceedings, whether civil
or criminal.
The Company paid insurance premiums of $16,063 in August 2020 in respect of directors’ and officers’
liability. The insurance premiums relate to:
costs and expenses incurred by the relevant officers in defending legal proceedings, whether civil or
criminal and whatever their outcome;
other liabilities that may arise from their position, with the exception of conduct involving wilful breach
of duty or improper use of information to gain a personal advantage.
INDEMNITY AND INSURANCE OF AUDITOR
The company has not, during or since the end of the financial year, indemnified or agreed to indemnify the
auditor of the company or any related entity against a liability incurred by the auditor.
During the financial year, the company has not paid a premium in respect of a contract to insure the auditor
of the company or any related entity.
PROCEEDINGS ON BEHALF OF COMPANY
No person has applied for leave of court to bring proceedings on behalf of the Company or intervene in any
proceeding to which the Company is a party for the purpose of taking responsibility on behalf of the Company
for all or any part of those proceedings. The Company was not a party to any such proceedings during the
year.
AUDITORS
RSM Australia Partners continues in office in accordance with section 327 of the Corporations Act 2001.
Auditor’s independence declaration
The lead auditor’s independence declaration under Section 307C in relation to auditor’s independence for
the year ended 30 June 2020 has been received and can be found on the following page.
Non-audit services
The Board of Directors advises that no non-audit services were provided by the Company’s auditors during
the year.
Officers of the company who are former partners of RSM Australia Partners
There are no officers of the Company who are former partners of RSM Australia Partners.
This report is made in accordance with a resolution of the directors pursuant to section 298(2)(a) of the
Corporations Act 2001.
Guy Robertson
Director
Sydney, 29 September 2020
20
RSM Australia Partners
Level 13, 60 Castlereagh Street Sydney NSW 2000
GPO Box 5138 Sydney NSW 2001
T +61 (0) 2 8226 4500
F +61 (0) 2 8226 4501
www.rsm.com.au
AUDITOR’S INDEPENDENCE DECLARATION
As lead auditor for the audit of the financial report of Metal Bank Limited for the year ended 30 June 2020, I
declare that, to the best of my knowledge and belief, there have been no contraventions of:
(i)
the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
(ii)
any applicable code of professional conduct in relation to the audit.
RSM AUSTRALIA PARTNERS
Gary N Sherwood
Partner
Sydney NSW
Dated: 29 September 2020
THE POWER OF BEING UNDERSTOOD
AUDIT | TAX | CONSULTING
21
RSM Australia Partners is a member of the RSM network and trades as RSM. RSM is the trading name used by the members of the RSM network. Each member of the
RSM network is an independent accounting and consulting firm which practices in its own right. The RSM network is not itself a separate legal entity in any jurisdiction.
RSM Australia Partners ABN 36 965 185 036
Liability limited by a scheme approved under Professional Standards Legislation
METAL BANK LIMITED AND ITS CONTROLLED ENTITY
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2020
Revenue
Administration expenses
Personnel costs
Compliance and regulatory expenses
Directors fees
Management and consulting fees
Travel expenses
Exploration expenditure written off
LOSS BEFORE INCOME TAX
Income tax expense
LOSS FOR THE YEAR
LOSS ATTRIBUTABLE TO MEMBERS OF
METAL BANK LIMITED
Note
2
10
3
4
2020
$
11,069
(92,216)
(3,150)
(70,773)
(50,000)
(239,673)
(1,554)
(884,799)
2019
$
41,781
(62,863)
(42,357)
(88,859)
(50,000)
(211,271)
(8,015)
(3,442)
(1,331,096)
(425,026)
-
-
(1,331,096)
(425,026)
(1,331,096)
(425,026)
OTHER COMPREHENSIVE INCOME
-
-
TOTAL COMPREHENSIVE LOSS
(1,331,096)
(425,026)
Loss for the year is attributable to:
Owners of Metal Bank Limited
Total Comprehensive loss for the year is
attributable to:
Owners of Metal Bank Limited
Earnings per share
Basic and diluted loss per share
(cents per share)
(1,331,096)
(425,026)
(1,331,096)
(425,026)
20
(0.15)
(0.05)
The Consolidated Statement of Profit or Loss and Other Comprehensive Income are to be read in conjunction
with the attached notes
22
METAL BANK LIMITED AND ITS CONTROLLED ENTITY
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2020
CURRENT ASSETS
Cash and cash equivalents
Trade and other receivables
Financial assets
Assets classified as held for sale
TOTAL CURRENT ASSETS
NON-CURRENT ASSETS
Plant and equipment
Exploration and evaluation expenditure
TOTAL NON-CURRENT ASSETS
TOTAL ASSETS
CURRENT LIABILITIES
Trade and other payables
TOTAL CURRENT LIABILITIES
TOTAL LIABILITIES
NET ASSETS
EQUITY
Issued capital
Accumulated losses
TOTAL EQUITY
Note
2020
$
2019
$
5
6
7
8
9
10
11
627,052
35,619
1,250
663,921
6,400,000
7,063,921
6,593
2,235,455
2,242,048
1,753,685
61,164
1,250
1,816,099
-
1,816,099
29,667
8,804,339
8,834,006
9,305,969
10,650,105
220,303
220,303
233,343
233,343
220,303
233,343
9,085,666
10,416,762
13
20,852,582
(11,766,916)
20,852,582
(10,435,820)
9,085,666
10,416,762
The Consolidated Statement of Financial Position are to be read in conjunction with the attached notes.
23
METAL BANK LIMITED AND ITS CONTROLLED ENTITY
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2020
Issued
Capital
$
Reserves
Accumulated
Losses
$
Note
Total
$
Balance as at 1 July 2019
Loss for the year
Other comprehensive income for
the year
Total comprehensive loss for the
year
Balance as at 30 June 2020
20,852,582
-
-
-
-
20,852,582
-
-
-
-
-
-
(10,435,820)
(1,331,096)
10,416,762
(1,331,096)
-
-
-
(1,331,096)
(11,766,916)
-
(1,331,096)
9,085,666
Balance as at 1 July 2018
Loss for the year
Other comprehensive
income for the year
Total comprehensive
loss for the year
20,827,582
-
162,520
-
(10,148,314)
(425,026)
10,841,788
(425,026)
-
-
-
-
-
-
(425,026)
(425,026)
Transfer from share based payment 14
25,000
(162,520)
137,520
-
Balance as at 30 June 2019
20,852,582
-
(10,435,820)
10,416,762
The Consolidated Statement of Changes in Equity are to be read in conjunction with the attached notes.
24
METAL BANK LIMITED AND ITS CONTROLLED ENTITY
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2020
CASH FLOWS FROM OPERATING ACTIVITIES
Payments to suppliers and employees
Interest received
NET CASH USED IN OPERATING ACTIVITIES
22
CASH FLOWS FROM INVESTING ACTIVITIES
Payments for plant and equipment
Proceeds on sale of plant and equipment
Payment for exploration and evaluation
NET CASH USED IN INVESTING ACTIVITIES
CASH FLOWS FROM FINANCING ACTIVITIES
Other
NET CASH PROVIDED BY FINANCING
ACTIVITIES
2020
$
2019
$
(436,023)
11,069
(424,954)
-
8,000
(709,679)
(701,679)
-
(464,806)
42,089
(422,717)
(1,991)
-
(802,188)
(804,179)
-
-
NET DECREASE IN CASH HELD
(1,126,633)
(1,226,896)
Cash at the beginning of the financial year
CASH AT THE END OF THE FINANCIAL YEAR
5
1,753,685
627,052
2,980,581
1,753,685
The Consolidated Statement of Cash Flows are to be read in conjunction with the attached notes.
25
METAL BANK LIMITED AND ITS CONTROLLED ENTITY
NOTES TO THE FINANCIAL STATEMENTS
This financial report includes the consolidated financial statements and notes of Metal Bank Limited and its
controlled entities (Consolidated Group or Group), and a separate note on the accounts of Metal Bank
Limited as the parent entity (Parent).
1. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PREPARATION
The financial report is a general purpose financial report that has been prepared in accordance with Australian
Accounting Standards, Australian Accounting Interpretations, other authoritative pronouncements of the
Australian Accounting Standards Board and the Corporations Act 2001.
Australian Accounting Standards set out accounting policies that the AASB has concluded would result in a
financial report containing relevant and reliable information about transactions, events and conditions.
Compliance with Australian Accounting Standards ensures that the financial statements and notes also
comply with International Financial Reporting Standards. Material accounting policies adopted in the
preparation of this financial report are presented below and have been consistently applied unless otherwise
stated.
This financial report is presented in Australian Dollars.
The financial report has been prepared on an accruals basis and is based on historical costs, modified, where
applicable, by the measurement at fair value of selected non-current assets, financial assets and financial
liabilities.
The financial report covers the Group of Metal Bank Limited and controlled entities. Metal Bank Limited is a
public listed company, incorporated and domiciled in Australia.
a.
Principles of Consolidation
The consolidated financial statements incorporate the assets, liabilities and results of entities controlled
by Metal Bank Limited at the end of the reporting period. A controlled entity is any entity over which
Metal Bank Limited has the ability and right to govern the financial and operating policies so as to obtain
benefits from the entity’s activities.
Where controlled entities have entered or left the Group during the year, the financial performance of
those entities is included only for the period of the year that they were controlled. A list of controlled
entities is contained in Note 9 to the financial statements.
In preparing the consolidated financial statements, all inter-group balances and transactions between
entities in the consolidated group have been eliminated in full on consolidation.
Non-controlling interests, being the equity in a subsidiary not attributable, directly or indirectly, to a
parent, are reported separately within the equity section of the consolidated statement of financial
position and statement of comprehensive income. The non-controlling interests in the net assets
comprise their interests at the date of the original business combination and their share of changes in
equity since that date.
b. Adoption of New and Revised Accounting Standards
Changes in accounting policies on initial application of Accounting Standards
The consolidated entity has adopted all of the new or amended Accounting Standards and
Interpretations issued by the Accounting Standards Board (“AASB”) that are mandatory for the current
reporting period.
Any new or amended Accounting Standards or Interpretations that are not yet mandatory have not been
early adopted.
The following Accounting Standards and Interpretations are most relevant to the consolidated entity.
26
METAL BANK LIMITED AND ITS CONTROLLED ENTITY
NOTES TO THE FINANCIAL STATEMENTS
Statement of significant accounting policies (continued)
AASB 16 Leases
The consolidated entity has adopted AASB 16 from 1 July 2019. The standard replaces AASB 117 ‘Leases’
and for lessees eliminates the classifications of operating and finance leases. Except for short-term
leases and leases of low-value assets, right-of-use assets and corresponding lease liabilities are
recognised in the statement of financial position. Straight-line operating lease expense recognition is
replaced is replaced with a depreciation charge for the right-of-use assets (included in operating costs)
and an interest expense on the recognised lease liabilities (included in finance costs).
In the earlier periods of the lease, the expenses associated with the lease under AASB 16 will be higher
when compared to leas expenses under AASB 117. However, EBITDA (Earnings Before Interest, Tax,
Depreciation and Amortisation) results improve as the operating expense is now replaced by interest
expense and depreciation in profit or loss. For classification within the statement of cash flows, the
interest portion is disclosed in operating activities and the principal portion of the lease payments are
separately disclosed in financing activities. For lessor accounting, the standard does not substantially
change how a lessor accounts for leases.
c.
Income Taxes
The income tax expense (revenue) for the year comprises current income tax expense (income) and
deferred tax expense (income). Current income tax expense charged to the profit or loss is the tax payable
on taxable income calculated using applicable income tax rates enacted, or substantially enacted, as at
reporting date. Current tax liabilities (assets) are therefore measured at the amounts expected to be paid
to (recovered from) the relevant taxation authority.
Deferred income tax expense reflects movements in deferred tax asset and deferred tax liability balances
during the year as well unused tax losses. Current and deferred income tax expense (income) is charged
or credited directly to equity instead of the profit or loss when the tax relates to items that are credited
or charged directly to equity. Deferred tax assets and liabilities are ascertained based on temporary
differences arising between the tax bases of assets and liabilities and their carrying amounts in the
financial statements. Deferred tax assets also result where amounts have been fully expensed but future
tax deductions are available. No deferred income tax will be recognised from the initial recognition of an
asset or liability, excluding a business combination, where there is no effect on accounting or taxable
profit or loss.
Deferred tax assets and liabilities are calculated at the tax rates that are expected to apply to the period
when the asset is realised or the liability is settled, based on tax rates enacted or substantively enacted at
reporting date. Their measurement also reflects the manner in which management expects to recover or
settle the carrying amount of the related asset or liability. Deferred tax assets relating to temporary
differences and unused tax losses are recognised only to the extent that it is probable that future taxable
profit will be available against which the benefits of the deferred tax asset can be utilised. Where
temporary differences exist in relation to investments in subsidiaries, branches, associates, and joint
ventures, deferred tax assets and liabilities are not recognised where the timing of the reversal of the
temporary difference can be controlled and it is not probable that the reversal will occur in the
foreseeable future.
Current tax assets and liabilities are offset where a legally enforceable right of set-off exists and it is
intended that net settlement or simultaneous realisation and settlement of the respective asset and
liability will occur. Deferred tax assets and liabilities are offset where a legally enforceable right of set-off
exists, the deferred tax assets and liabilities relate to income taxes levied by the same taxation authority
on either the same taxable entity or different taxable entities where it is intended that net settlement or
simultaneous realisation and settlement of the respective asset and liability will occur in future periods in
which significant amounts of deferred tax assets or liabilities are expected to be recovered or settled.
27
METAL BANK LIMITED AND ITS CONTROLLED ENTITY
NOTES TO THE FINANCIAL STATEMENTS
Statement of significant accounting policies (continued)
d. Current and Non-Current Classification
Assets and liabilities are presented in the statement of financial position based on current and non-current
classification.
An asset is classified as current when: it is either expected to be realised or intended to be sold or
consumed in the consolidated entity's normal operating cycle; it is held primarily for the purpose of
trading; it is expected to be realised within 12 months after the reporting period; or the asset is cash or
cash equivalent unless restricted from being exchanged or used to settle a liability for at least 12 months
after the reporting period. All other assets are classified as non-current.
A liability is classified as current when: it is either expected to be settled in the consolidated entity's
normal operating cycle; it is held primarily for the purpose of trading; it is due to be settled within 12
months after the reporting period; or there is no unconditional right to defer the settlement of the liability
for at least 12 months after the reporting period. All other liabilities are classified as non-current.
e.
Property, Plant and Equipment
Plant and equipment is stated at cost less accumulated depreciation and any accumulated impairment
losses.
Depreciation is calculated on a straight-line basis over the estimated useful life of the assets as follows:
Plant and equipment – over 5 years
The assets’ residual values, useful lives and amortisation methods are reviewed, and adjusted if
appropriate, at each financial year end.
(i) Impairment
The carrying values of plant and equipment are reviewed for impairment at each balance date, with
recoverable amount being estimated when events or changes in circumstances indicate that the carrying
value may be impaired.
The recoverable amount of plant and equipment is the higher of fair value less costs to sell and value in
use.
An impairment exists when the carrying value of an asset exceeds its estimated recoverable amount.
The asset is then written down to its recoverable amount.
For plant and equipment, impairment losses are recognised in the statement of comprehensive income.
An annual transfer from the asset revaluation reserve to retained earnings is made for the difference
between depreciation based on the re-valued carrying amounts of the assets and depreciation based on
the assets’ original costs. Additionally, any accumulated depreciation as at the revaluation date is
eliminated against the gross carrying amounts of the assets and the net amounts are restated to the re-
valued amounts of the assets.
Upon disposal, any revaluation reserve relating to the particular asset being sold is transferred to
retained earnings.
(ii) Derecognition and disposal
An item of property, plant and equipment is derecognised upon disposal or when no further future
economic benefits are expected from its use or disposal. Any gain or loss arising on derecognition of the
asset (calculated as the difference between the net disposal proceeds and the carrying amount of the
asset) is included in the statement of comprehensive income in the year the asset is derecognised.
28
METAL BANK LIMITED AND ITS CONTROLLED ENTITY
NOTES TO THE FINANCIAL STATEMENTS
Statement of significant accounting policies (continued)
f.
Exploration and Evaluation Costs
Exploration, evaluation and development expenditure incurred is accumulated in respect of each
identifiable area of interest. These costs are only carried forward to the extent that they are expected to
be recouped through the successful development of the area or where activities in the area have not yet
reached a stage that permits reasonable assessment of the existence of economically recoverable
reserves. Accumulated costs in relation to an abandoned area are written off in full against profit in the
year in which the decision to abandon the area is made.
An area of interest refers to an individual geological area whereby the presence of a mineral deposit is
considered favourable or has been proved to exist. It is common for an area of interest to contract in size
progressively, as exploration and evaluation lead towards the identification of a mineral deposit which
may prove to contain economically recoverable reserves. When this happens during the exploration for
and evaluation of mineral resources, exploration and evaluation expenditures are still included in the cost
of the exploration and evaluation asset notwithstanding that the size of the area of interest may contract
as the exploration and evaluation operations progress. In most cases, an area of interest will comprise a
single mine or deposit.
When production commences, the accumulated costs for the relevant area of interest are amortised over
the life of the area according to the rate of depletion of the economically recoverable reserves. A regular
review is undertaken of each area of interest to determine the appropriateness of continuing to carry
forward costs in relation to that area of interest. Costs of site restoration are provided over the life of the
facility from when exploration commences and are included in the costs of that stage. Site restoration
costs include the dismantling and removal of mining plant, equipment and building structures, waste
removal, and rehabilitation of the site in accordance with clauses of the mining permits. Such costs have
been determined using estimates of future costs, current legal requirements and technology on an
undiscounted basis.
Any changes in the estimates for the costs are accounted on a prospective basis. In determining the costs
of site restoration, there is uncertainty regarding the nature and extent of the restoration due to
community expectations and future legislation. Accordingly the costs have been determined on the basis
that the restoration will be completed within one year of abandoning the site.
g.
Financial Instruments
A financial asset shall be measured at amortised cost if it is held within a business model whose objective
is to hold assets in order to collect contractual cash flows which arise on specified dates and that are solely
principal and interest. A debt investment shall be measured at fair value through other comprehensive
income if it is held within a business model whose objective is to both hold assets in order to collect
contractual cash flows which arise on specified dates that are solely principal and interest as well as selling
the asset on the basis of its fair value. All other financial assets are classified and measured at fair value
through profit or loss unless the entity makes an irrevocable election on initial recognition to present gains
and losses on equity instruments (that are not held-for-trading or contingent consideration recognised in
a business combination) in other comprehensive income ('OCI'). Despite these requirements, a financial
asset may be irrevocably designated as measured at fair value through profit or loss to reduce the effect
of, or eliminate, an accounting mismatch. For financial liabilities designated at fair value through profit or
loss, the standard requires the portion of the change in fair value that relates to the entity's own credit
risk to be presented in OCI (unless it would create an accounting mismatch). New simpler hedge
accounting requirements are intended to more closely align the accounting treatment with the risk
management activities of the entity. New impairment requirements use an 'expected credit loss' ('ECL')
model to recognise an allowance. Impairment is measured using a 12-month ECL method unless the credit
risk on a financial instrument has increased significantly since initial recognition in which case the lifetime
29
METAL BANK LIMITED AND ITS CONTROLLED ENTITY
NOTES TO THE FINANCIAL STATEMENTS
Statement of significant accounting policies (continued)
Financial Instruments (continued)
ECL method is adopted. For receivables, a simplified approach to measuring expected credit losses using
a lifetime expected loss allowance is available.
(i) Classification
From 1 January 2018, the Company classifies its financial assets in the following measurement categories:
those to be measured subsequently at fair value (either through OCI or through profit or loss), and
those to be measured at amortised cost.
The classification depends on the Company’s business model for managing the financial assets and the
contractual terms of the cash flows.
For assets measured at fair value, gains and losses will either be recorded in profit or loss or OCI. For
investments in equity instruments that are not held for trading, this will depend on whether the Company
has made an irrevocable election at the time of initial recognition to account for the equity investment at
fair value through other comprehensive income (FVOCI).
The Company reclassifies debt investments when and only when its business model for managing those
assets changes.
(ii) Recognition and derecognition
Regular way 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.
(iii) 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 (FVPL), transaction costs that are directly attributable to the
acquisition of the financial asset. Transaction costs of financial assets carried at FVPL are expensed in
profit or loss.
Financial assets with embedded derivatives are considered in their entirety when determining whether
their cash flows are solely payment of principal and interest.
iv) Impairment
From 1 January 2018, the Company assesses on a forward looking basis the expected credit losses
associated with its debt instruments carried at amortised cost and FVOCI. The impairment methodology
applied depends on whether there has been a significant increase in credit risk.
For trade receivables, the Company applies the simplified approach permitted by AASB 9, which requires
expected lifetime losses to be recognised from initial recognition of the receivables.
h.
Impairment of Assets
At each reporting date, the Company reviews the carrying values of its tangible and intangible assets to
determine whether there is any indication that those assets have been impaired. If such an indication
exists, the recoverable amount of the asset, being the higher of the asset’s fair value less costs to sell and
value in use, is compared to the asset’s carrying value. Any excess of the asset’s carrying value over its
recoverable amount is expensed to the consolidated statement of comprehensive income. Impairment
testing is performed annually for goodwill and intangible assets with indefinite lives.
Where it is not possible to estimate the recoverable amount of an individual asset, the Company estimates
the recoverable amount of the cash-generating unit to which the asset belongs. In the case of available-
for-sale financial instruments, a prolonged decline in the value of the instrument is considered to
determine whether impairment has arisen.
30
METAL BANK LIMITED AND ITS CONTROLLED ENTITY
NOTES TO THE FINANCIAL STATEMENTS
Statement of significant accounting policies (continued)
i.
Trade and other receivables
Trade receivables are initially recognised at fair value and subsequently measured at amortised cost using
the effective interest method, less any provision for impairment. Trade receivables are generally due for
settlement within 30 days.
The consolidated entity has applied the simplified approach to measuring expected credit losses, which
uses a lifetime expected loss allowance. To measure the expected credit losses, trade receivables have
been grouped based on days overdue.
Other receivables are recognised at amortised cost, less any allowance for credit losses.
j.
Cash and Cash Equivalents
Cash and cash equivalents include cash on hand, deposits held at call with banks, other short-term highly
liquid investments with original maturities of 3 months or less, and bank overdrafts. Bank overdrafts are
shown within short-term borrowings in current liabilities on the statement of financial performance.
k.
Trade and Other Payables
These amounts represent liabilities for goods and services provided to the consolidated entity prior to the
end of the financial year and which are unpaid. Due to their short-term nature they are measured at
amortised cost and are not discounted. The amounts are unsecured and are usually paid within 30 days
of recognition.
l.
Employee benefits
(i)
Wages and salaries and annual leave
Liabilities for wages and salaries, including non-monetary benefits and annual leave expected to be settled
within 12 months of the end of the reporting period are recognised in other payables in respect of
employees' services rendered up to the end of the reporting period and are measured at amounts
expected to be paid when the liabilities are settled.
(ii)
Retirement benefit obligations
The Group does not maintain a company superannuation plan. The Group makes fixed percentage
contributions for all Australian resident employees to complying third party superannuation funds. The
Group's legal or constructive obligation is limited to these contributions.
Contributions to complying third party superannuation funds are recognised as an expense as they
become payable. Prepaid contributions are recognised as an asset to the extent that a cash refund or a
reduction in the future payments is available.
m. Revenue Recognition
Interest revenue is recognised using the effective interest method. It includes the amortisation of any
discount or premium.
n. Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of
GST incurred is not recoverable from the Australian Tax Office. In these circumstances the GST is
recognised as part of the cost of acquisition of the asset or as part of an item of the expense. Receivables
and payables in the statement of financial position are shown inclusive of GST. Cash flows are presented
in the statement of cash flows on a gross basis, except for the GST component of investing and financing
activities, which are disclosed as operating cash flows.
31
METAL BANK LIMITED AND ITS CONTROLLED ENTITY
NOTES TO THE FINANCIAL STATEMENTS
Statement of significant accounting policies (continued)
o.
Earnings Per Share
Basic earnings per share
Basic earnings per share is calculated by dividing the profit attributable to the owners of Metal Bank
Limited, excluding any costs of servicing equity other than ordinary shares, by the weighted number of
ordinary shares outstanding during the financial year, adjusted for bonus elements in ordinary shares
issued during the financial year.
Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to
take into account the after income tax effect of interest and other financing costs associated with dilutive
potential ordinary shares and the weighted average number of ordinary shares assumed to have been
issued for no consideration in relation to dilutive potential ordinary shares.
p. Comparative Figures
When required by Accounting Standards, comparative figures have been adjusted to conform to changes
in presentation for the current financial year.
q.
Significant Judgements and Key Assumptions
The directors evaluate estimates and judgements 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.
r.
Key Judgements and Estimates
Key Judgement Exploration Expenditure
The Company capitalises expenditure relating to exploration and evaluation where it is considered likely
to be recoverable or where the activities have not reached a stage which permits a reasonable assessment
of the existence of reserves. While there are certain areas of interest from which no reserves have been
extracted, the directors are of the continued belief that such expenditure should not be impaired since
feasibility studies in such areas have not yet concluded. Such capitalised expenditure is carried at
reporting date at $2,235,455.
Key Judgement Environmental Issues
Balances disclosed in the financial statements and notes thereto are not adjusted for any pending or
enacted environmental legislation, and the directors understanding thereof. At the current stage of the
company’s development and its current environmental impact the directors believe such treatment is
reasonable and appropriate.
2. REVENUE AND OTHER INCOME
Interest received
2020
$
11,069
11,069
2019
$
41,781
41,781
32
METAL BANK LIMITED AND ITS CONTROLLED ENTITY
NOTES TO THE FINANCIAL STATEMENTS
3. LOSS FOR THE YEAR
Loss for the year is after charging:
Wages and salaries
Superannuation
Other employment related costs
Less capitalised exploration costs
Personnel costs
4. INCOME TAX EXPENSE
2020
$
27,300
2,594
3,150
33,044
(29,894)
3,150
2019
$
195,087
18,518
(10,112)
203,493
(161,136)
42,357
(a) No income tax is payable by the parent or consolidated entity as they recorded losses for income tax
purposes for the period.
(b) Reconciliation between income tax expense and prima facie tax on accounting profit (loss)
Accounting profit (loss)
Tax at 27.5% (2019:27.5%)
Tax effect of other (deductible)/non-deductible
items
Deferred tax asset not recognised
Income tax expense
(c) Deferred tax assets
Revenue tax losses
Deferred tax assets not recognised
Set off deferred tax liabilities
Income tax expense
(d) Deferred tax liabilities
Exploration expenditure
Set off deferred tax assets
2020
$
(1,331,096)
(366,051)
2019
$
(425,026)
(116,882)
232,128
133,923
-
(9,478)
126,360
-
329,086
(133,923)
(195,163)
-
351,680
(126,360)
(225,320)
-
195,163
(195,163)
-
225,320
(225,320)
-
(e) Tax losses
Unused tax losses for which no deferred tax asset
has been recognised
16,730,771
15,548,046
Potential deferred tax assets attributable to tax losses and exploration expenditure carried forward have not
been brought to account at 30 June 2020 because the directors do not believe it is appropriate to regard
realisation of the deferred tax assets as probable at this point in time. These benefits will only be obtained if:
the Company derives future assessable income of a nature and of an amount sufficient to enable the
benefit from the deductions for the loss and exploration expenditure to be realised;
the Company continues to comply with conditions for deductibility imposed by law; and
no changes in tax legislation adversely affect the company in realising the benefit from the deductions for
the loss and exploration expenditure.
The applicable tax rate is the national tax rate in Australia for companies, which is 27.5% at the reporting date.
33
METAL BANK LIMITED AND ITS CONTROLLED ENTITY
NOTES TO THE FINANCIAL STATEMENTS
5. CASH AND CASH EQUIVALENTS
Cash and cash equivalents
627,052
1,753,685
2020
$
2019
$
6. TRADE AND OTHER RECEIVABLES
CURRENT
Other receivables
GST receivable
7. FINANCIAL ASSETS
CURRENT
ASX Listed Shares
Financial assets available for sale¹
¹ Shares in Locality Planning Energy Holdings Limited.
8. ASSETS CLASSIFIED AS AVAILABLE FOR SALE
Non-current assets held for sale
Exploration asset
2020
$
2019
$
17,308
18,311
35,619
29,697
31,467
61,164
2020
$
2019
$
1,250
1,250
1,250
1,250
2020
$
2019
$
6,400,000
-
Subsequent to year end through its wholly owned subsidiary Roar Resources Pty Ltd (Roar Resources), the
Group has settled the sale of the Company’s Triumph tenements with $400,000 paid upon settlement out of a
total potential consideration of $6.4 million plus a 1% gross royalty.
Additional consideration for the sale of the Triumph tenements comprises:
a 1% royalty on gross revenue from the sale of gold mined from the tenements to be granted to Roar
Resources at settlement; and
staged payments upon identification of JORC Mineral Resource milestones on the tenements as
follows:
-
-
-
$1.5 million for a Mineral Resource of 500,000 oz or more;
$2 million for a Mineral Resource of 1,000,000 oz or more; and
$2.5 million for a Mineral Resources of 2,000,000 oz or more.
34
METAL BANK LIMITED AND ITS CONTROLLED ENTITY
NOTES TO THE FINANCIAL STATEMENTS
9. PLANT AND EQUIPMENT
Cost
Opening balance, 1 July 2018
Additions
Closing balance, 30 June 2019
Opening balance, 1 July 2019
Disposals
Closing balance, 30 June 20120
Depreciation
Opening balance, 1 July 2018
Depreciation
Closing balance, 30 June 2019
Opening balance, 1 July 2019
Disposals
Depreciation
Closing balance, 30 June 2020
Written Down Value 30 June 2019
Written down value 30 June 2020
Motor Vehicle
Office Equipment
Total
23,955
-
23,955
23,955
(23,955)
-
(1,345)
(2,995)
(4,340)
(4,340)
4,340
-
-
19,615
-
17,992
1,991
19,983
19,983
-
19,983
(7,953)
(1,978)
(9,931)
(9,931)
-
(3,459)
(13,390)
10,052
6,593
41,947
1,991
43,938
43,938
(23,955)
19,983
(9,298)
(4,973)
(14,271)
(14,271)
4,340
(3,459)
(13,390)
29,667
6,593
10. EXPLORATION AND EVALUATION EXPENDITURE
2020
$
2019
$
Exploration and evaluation expenditure
2,235,455
8,804,339
Reconciliation of carrying amount
Balance at beginning of financial year
Expenditure in current year
Expenditure reclassified to assets available for sale
Exploration expenditure written off1
Balance at end of financial period
8,804,339
717,160
(6,400,000)
(886,044)
2,235,455
7,984,603
819,736
-
-
8,804,339
1The Directors have determined to write down the carrying value of the Triumph project to the potential
consideration, excluding the royalty, see note 8.
35
METAL BANK LIMITED AND ITS CONTROLLED ENTITY
NOTES TO THE FINANCIAL STATEMENTS
11. TRADE AND OTHER PAYABLES
CURRENT
Unsecured liabilities:
Trade payables
Sundry payables and accrued expenses
12. EMPLOYEE BENEFIT OBIGATIONS
CURRENT
Provision for annual leave, opening balance
Annual leave taken
Provision for annual leave, closing balance
13. SHARE CAPITAL
2020
$
2019
$
130,647
89,656
220,303
162,121
71,222
233,343
2020
$
2019
$
-
-
-
13,562
(13,562)
-
882,864,297 (2019 – 882,864,297)
fully paid ordinary shares
2020
2019
20,852,582
20,852,582
Ordinary shares participate in dividends and the proceeds on winding up of the parent entity in proportion to
the number of shares held. At shareholders’ meetings each ordinary share is entitled to one vote when a poll
is called, otherwise each shareholder has one vote on a show of hands.
Reconciliation of movements in share capital during the year:
Opening balance
Vesting of performance rights –
20 September 2018
2020
2019
No. Shares
882,864,297
No. Shares
881,609,712
2020
$
20,852,582
2019
$
20,827,582
-
1,254,585
-
25,000
Closing balance
882,864,297
882,864,297
20,852,582
20,852,582
Capital Management
The Company’s objectives when managing capital are to safeguard its ability to continue as a going concern, so
that it may continue to provide returns for shareholders and benefits for other stakeholders.
The Company’s capital includes ordinary share capital and financial liabilities, supported by financial assets.
Due to the nature of the Company’s activities, being mineral exploration, it does not have ready access to credit
facilities, with the primary source of funding being equity raisings. Accordingly, the objective of the Company’s
capital risk management is to balance the current working capital position against the requirements of the
Company to meet exploration programmes and corporate overheads. This is achieved by maintaining
appropriate liquidity to meet anticipated operating requirements, with a view to initiating appropriate capital
raisings as required.
36
METAL BANK LIMITED AND ITS CONTROLLED ENTITY
NOTES TO THE FINANCIAL STATEMENTS
Capital Management (continued)
Cash and cash equivalents
Trade and other receivables
Financial assets
Trade and other payables
Working capital position
Share options
Movements in share options
At 1 July
Issued during the year
Expired during the year
At 30 June
2020
2019
$
$
627,052
1,753,685
35,619
1,250
(220,303)
443,618
2020
No.
-
-
-
-
61,164
1,250
(233,343)
1,582,756
2019
No.
182,768,285
-
(182,768,285)
-
The options which expired during the previous year had an exercise price of 3 cents.
There were no share options outstanding at year end and no options were granted during the year
No performance rights were issued or were on issue during the year.
Performance rights
Movements in performance rights
At 1 July
Performance rights vested
Performance rights lapsed
At 30 June
14. RESERVES
Option issue reserve
Movements in options issue reserve
Opening balance
Share based payment
Issue of shares on vesting of performance rights
Lapse of performance rights
Closing balance
37
2020
No.
2019
No.
-
-
-
-
3,737,184
(1,254,585)
(2,482,599)
-
2020
$
-
-
-
-
-
-
2019
$
-
162,520
-
(25,000)
(137,520)
-
METAL BANK LIMITED AND ITS CONTROLLED ENTITY
NOTES TO THE FINANCIAL STATEMENTS
15. FINANCIAL RISK MANAGEMENT
The group’s principal financial instruments comprise mainly of borrowings and deposits with banks and shares
in listed companies shown as financial assets at fair value through profit and loss. The main purpose of the
financial instruments is to achieve optimal funding for the group with limited risk and earn the maximum
amount of interest at a low risk to the group. The group also has other financial instruments such as trade
debtors and creditors which arise directly from its operations.
The consolidated entity holds the following financial instruments at the end of the reporting period:
Financial assets
Cash and cash equivalents
Trade and other receivables
Financial assets at fair value through profit
and loss
Financial liabilities
Trade and other payables
2020
$
627,052
35,619
1,250
663,921
220,303
2019
$
1,753,685
61,164
1,250
1,816,099
233,343
The main risks arising from the Company’s financial instruments are market risk, credit risk and liquidity risk.
The Board reviews and agrees policies for managing each of these risks and they are summarised below:
a. Market risk
Cash flow and fair value interest rate risk
The group’s main interest rate risk arises from borrowings and cash deposits to be applied to
exploration and development areas of interest. Borrowings are primarily to bridge the gap between
funding requirements and obtaining shareholder approval for equity issues. It is the group’s policy to
invest cash in short term deposits to minimise the group’s exposure to interest rate fluctuations. The
group’s deposits were denominated in Australian dollars throughout the year. The group did not enter
into any interest rate swap contracts.
b. Credit Risk
Credit risk refers to the risk that counterparty will default on its contractual obligations resulting in
financial loss to the group. The group has adopted the policy of only dealing with credit worthy
counterparties and obtaining sufficient collateral or other security where appropriate, as a means of
mitigating the risk of financial loss from defaults. The cash transactions of the group are limited to high
credit quality financial institutions.
The group does not have any significant credit risk exposure to any single counterparty or any group
of counterparties having similar characteristics. The carrying amount of financial assets recorded in
the financial statements, net of any provisions for losses, represents the group’s maximum exposure
to credit risk.
All cash holdings within the Group are currently held with AA rated financial institutions.
c. Liquidity Risk
The group manages liquidity risk by continuously monitoring forecast and actual cash flows and
matching the maturity profiles of financial assets and liabilities. Surplus funds when available are
generally only invested in high credit quality financial institutions in highly liquid markets.
38
METAL BANK LIMITED AND ITS CONTROLLED ENTITY
NOTES TO THE FINANCIAL STATEMENTS
Financial risk management (continued)
Financial Instrument composition and maturity analysis
The tables below reflect the undiscounted contractual settlement terms for financial instruments of a fixed
period of maturity, as well as management’s expectations of the settlement period for all other financial
instruments. As such, the amounts may not reconcile to the statement of financial position.
Consolidated
Group
Financial liabilities
- due for payment:
Trade and other
payables
Total contractual
outflows
Financial assets –
cash flows
realisable
Cash and cash
equivalents
Trade and other
receivables
Financial assets
Total anticipated
inflows
Net
inflow/(outflow)
on financial
instruments
Within 1 year
1 to 5 years
Over 5 years
Total
2020
$
2019
$
2020
$
2019
$
2020
$
2019
$
2020
$
2019
$
220,303
233,243
220,303
233,343
627,052
1,753,685
35,619
1,250
61,164
1,250
663,921
1,816,099
443,618
1,582,756
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
220,303
233,343
220,303
233,343
627,052
1,753,685
35,619
1,250
61,164
1,250
663,921
1,816,099
-
443,618
1,582,756
Cash flow sensitivity analysis for variable rate instruments
A change of 100 basis points in interest rates at the reporting date would have increased/(decreased) equity
and profit or loss by the amounts shown below.
30 June 2020
Cash and cash equivalents
Borrowings
30 June 2019
Cash and cash equivalents
Borrowings
Carrying
Value
$
627,052
-
627,052
$
1,753,685
-
1,753,685
Change in profit
Change in equity
100bp
Increase
$
100bp
decrease
$
100bp
increase
$
100bp
decrease
$
6,270
-
6,270
$
17,536
-
17,536
(6,270)
-
(6,270)
$
(17,536)
-
(17,536)
6,270
-
6,270
$
17,536
-
17,536
(6,270)
-
(6,270)
$
(17,536)
-
(17,536)
39
METAL BANK LIMITED AND ITS CONTROLLED ENTITY
NOTES TO THE FINANCIAL STATEMENTS
Financial risk management (continued)
Maturity of financial assets and liabilities
The note below summarises the maturity of the group’s financial assets and liabilities as per the director’s
expectations. The amounts disclosed are the contractual undiscounted cash flows. There are no derivatives.
30 June 2020
Trade and other receivables
Trade and other payables
30 June 2019
Trade and other receivables
Trade and other payables
< 6 months
$
35,619
220,303
$
61,164
233,343
6 – 12
months
$
-
-
$
-
-
1- 5 years
>5 years
Total
$
$
-
-
$
-
-
$
35,619
220,303
$
61,164
233,343
-
-
$
-
-
Fair value of financial assets and financial liabilities
There is no difference between the fair values and the carrying amounts of the group’s financial instruments.
The Group has no unrecognised financial instruments at balance date.
Financial Instruments Measured at Fair Value
The financial instruments recognised at fair value in the statement of financial position have been analysed and
classified using a fair value hierarchy reflecting the significance of the inputs used in making the measurements.
The fair value hierarchy consists of the following levels:
quoted prices in active markets for identical assets or liabilities (Level 1);
inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either
directly (as prices) or indirectly (derived from prices) (Level 2); and
inputs for the asset or liability that are not based on observable market data (unobservable inputs)
(Level 3).
Sensitivity analysis on changes in market rates
A change of 20% in equity prices at the reporting date would increase/(decrease) equity and profit or loss as
shown below:
30 June 2020
Financial assets available for sale
ASX listed investments
30 June 2019
Financial assets available for sale
ASX listed investments
Carrying
Value
$
Change in profit
20%
increase
$
20%
decrease
$
Change in equity
20%
20%
decrease
increase
$
$
1,250
250
(250)
250
(250)
1,250
250
(250)
250
(250)
40
METAL BANK LIMITED AND ITS CONTROLLED ENTITY
NOTES TO THE FINANCIAL STATEMENTS
16. COMMITMENTS
The consolidated group currently has commitments for expenditure at 30 June 2020 on its
Australian exploration tenements, up to the date of expiry, as follows:
Not later than 12 months
Between 12 months and 5 years
Greater than 5 years
2020
$
316,973
603,781
-
920,753
2019
$
315,833
492,917
-
808,750
17. CONTINGENT LIABILITIES AND CONTINGENT ASSETS
There are no contingent liabilities or assets in existence at balance sheet date.
18. RELATED PARTY DISCLOSURES
Refer to the Remuneration Report contained in the Directors Report for details of the remuneration paid or
payable to each member of the Group’s key management personnel for the year ended 30 June 2020. Other
than the Directors, secretary and exploration manager, the Company had no key management personnel for
the financial period ended 30 June 2020.
The total remuneration paid to key management personnel of the company and the group during the year are
as follows:
Short term employee benefits
Superannuation
Directors' and executive officers’ emoluments
(a) Details of Directors and Key Management Personnel
(i) Directors
2020
$
524,602
427
525,029
2019
$
560,062
12,746
572,808
Inés Scotland (Executive Chair) (Appointed 13 August 2013)
Sue-Ann Higgins (Executive Director) (Appointed 24 February 2020)
Guy Robertson (Executive Director) (Appointed 17 September 2012)
Anthony Schreck (Managing Director) (Appointed 29 November 2013. Resigned 24 February 2020)
(ii) Company secretary
Sue-Ann Higgins (Company Secretary) (Appointed 21 August 2013)
(iii) Directors’ remuneration
Directors’ remuneration and other terms of employment are reviewed annually by the Board having regard to
performance against goals set at the start of the year, relative comparative information and, where applicable,
independent expert advice.
Except as detailed in Notes (a) – (c) to the Remuneration Report in the Director’s Report, no director has
received or become entitled to receive, during or since the financial period, a benefit because of a contract
made by the Company or a related body corporate with a director, a firm of which a director is a member or
an entity in which a director has a substantial financial interest. This statement excludes a benefit included in
the aggregate amount of emoluments received or due and receivable by directors and shown in Notes (a) - (c)
to the Remuneration Report, prepared in accordance with the Corporations regulations, or the fixed salary of
a full time employee of the Company.
41
METAL BANK LIMITED AND ITS CONTROLLED ENTITY
NOTES TO THE FINANCIAL STATEMENTS
(b) Key Management Personnel
Other than the Directors, Company Secretary and Exploration Manager, the Company had no key management
personnel for the financial period ended 30 June 2020.
(c) Remuneration Options: Granted and vested during the financial year ended 30 June 2020
There were no remuneration options granted during the financial year ended 30 June 2020.
(d) Share and Option holdings
All equity dealings with directors have been entered into with terms and conditions no more favourable than
those that the entity would have adopted if dealing at arm’s length.
Shares held by Directors and Officers
Period from 1 July 2019 to 30 June 2020
Balance at
beginning
of period
108,936,780
17,501,330
680,000
14,332,615
3,452,491
144,903,216
I. Scotland
A. Schreck
G. Robertson
T. Wright
S. Higgins
Received as
Remuneration
Purchased
Balance at
end of year
-
-
-
-
-
-
-
-
-
-
-
-
108,936,780
17,501,330
680,000
14,332,615
3,452,491
144,903,216
Period from 1 July 2018 to 30 June 2019
Balance at
beginning
of period
Received as
Remuneration
Purchased
Balance at
end of year
I. Scotland
A. Schreck
G. Robertson
T. Wright
S. Higgins
108,936,780
16,959,814
-
541,516
-
108,936,780
17,501,330
-
-
680,000
680,000
13,953,120
3,118,917
142,968,631
379,495
333,574
1,254,585
-
14,332,615
-
680,000
3,452,491
144,903,216
Options held by Officers and Directors
No options were issued to officers and directors during the year.
Period from 1 July 2018 to 30 June 2019
Balance at
beginning
of period
12,676,000
9,250,000
-
-
808,000
22,734,000
I. Scotland
A. Schreck
T. Wright
G. Robertson
S. Higgins
Received as
Remuneration
Net Change
Other
Expired during
period
Balance at
end of year
-
-
-
-
-
-
42
-
-
-
-
-
-
(12,676,000)
(9,250,000)
-
-
(808,000)
(22,734,000)
-
-
-
-
-
-
METAL BANK LIMITED AND ITS CONTROLLED ENTITY
NOTES TO THE FINANCIAL STATEMENTS
Related party disclosures (continued)
Performance Rights
No performance rights were issued to officers and directors during the year.
19. SEGMENT INFORMATION
The group’s operations are in one business segment being the resources sector. The group operates in
Australia. All subsidiaries in the group operate within the same segment.
The group has no operating results or assets/liabilities in the United States of America and therefore no detail
segment information is disclosed.
20. EARNINGS PER SHARE
Reconciliation of earnings per share
Basic and diluted earnings per share
2020
Cents
2019
Cents
(0.15)
(0.05)
Profit/(loss) used in the calculation of the basic
earnings per share
(1,331,096)
(425,026)
Weighted average number of ordinary shares:
Used in calculating basic earnings per ordinary
share
Dilutive potential ordinary shares
Used in calculating diluted earnings per share
21. AUDITORS REMUNERATION
Auditor of parent entity
Audit or review of financial reports
Non-audit services
882,582,445
882,582,445
-
882,582,445
-
882,582,445
2020
$
34,500
-
34,500
2019
$
33,000
-
33,000
43
METAL BANK LIMITED AND ITS CONTROLLED ENTITY
NOTES TO THE FINANCIAL STATEMENTS
22. CASH FLOW INFORMATION
Reconciliation of net cash used in operating activities with profit after income tax
Loss after income tax
Non-cash flows in loss:
Depreciation
Other non-cash items
Exploration expenditure written off
Changes in assets and liabilities:
Decrease in trade and other receivables
Decrease in trade and other payables
Net cash outflow from operating activities
Non-cash Financing and Investing Activities
There were no non cash financing and investing activities.
23. PARENT ENTITY DISCLOSURES
Financial Position
Assets
Current Assets
Non-current assets
Total Assets
Total Current Liabilities
Total liabilities
NET ASSETS
EQUITY
Issued capital
Reserves
Accumulated losses
TOTAL EQUITY
2020
$
(1,331,096)
2019
$
(425,026)
5,542
3,296
884,799
4,973
-
25,545
(13,040)
(424,954)
15,242
(17,906)
(422,717)
2020
$
2019
$
627,052
8,548,464
1,782,626
8,773,026
9,175,516
10,555,652
89,850
89,850
138,890
138,890
9,085,666
10,416,762
20,852,582
(11,766,916)
20,852,582
-
(10,435,820)
9,085,666
10,416,762
Total loss
(1,331,096)
(425,026)
Total comprehensive loss
(1,331,096)
(425,026)
i. Contingent liabilities and contingent assets
The parent entity is responsible for the contingent liabilities and contingent assets outlined in note 17.
ii. Commitments
The parent entity is responsible for the commitments outlined in note 16.
iii. Related parties
Interest in subsidiaries is set out in note 24.
44
METAL BANK LIMITED AND ITS CONTROLLED ENTITY
NOTES TO THE FINANCIAL STATEMENTS
Disclosures relating to key management personnel are set out in note 18.
24. CONTROLLED ENTITY
Parent Entity:
Metal Bank Limited
Subsidiary:
Roar Resources Pty Ltd
Country of
Incorporation
Ownership %
2020
Ownership %
2019
Australia
Australia
-
100
-
100
25. SIGNIFICANT AFTER BALANCE DATE EVENTS
On 16 September 2020 the Company settled the sale of the Triumph project for a consideration of up to
$6,400,000 based on the project achieving JORC Mineral Resource milestones and a 1% gross royalty.
Subsequent to year end the Company undertook a placement and an entitlement offer raising approximately
$2.1 million from the issue of 301,644,007 shares at 7 cents each and 150,822,090 free attaching options with
exercise price of 1.5 cents and expiry date 31 March 2022. A further 15,000,000 options with exercise price 1.5
cents and expiry date 31 March 2020 were issued to brokers to the capital raise.
Other than as outline above, there are currently no matters or circumstances that have arisen since the end of
the financial period that have significantly affected or may significantly affect the operations of the
consolidated entity, the results of those operations, or the state of affairs of the consolidated entity in future
financial years.
45
METAL BANK LIMITED AND ITS CONTROLLED ENTITY
DIRECTOR’S DECLARATION
In accordance with a resolution of the directors of Metal Bank Limited, the directors of the company declare
that:
1.
the financial statements and notes, as set out on pages 22 to 45, are in accordance with the Corporations
Act 2001 and:
a. comply with Australian Accounting Standards, which, as stated in accounting policy Note 1 to the
financial statements, constitutes compliance with International Financial Reporting Standards (IFRS);
and
b. give a true and fair view of the financial position as at 30 June 2020 and of the performance for the
year ended on that date of the consolidated group;
2.
3.
in the directors’ opinion 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 directors have been given the declarations required by s295A of the Corporations Act 2001 from the
Chief Executive Officer and Chief Financial Officer.
Signed in accordance with a resolution of directors made pursuant to section 295(5)(a) of the
Corporations Act 2001.
Guy Robertson
Director
Sydney, 29 September 2020
46
INDEPENDENT AUDITOR’S REPORT
To the Members of Metal Bank Limited
Qualified Opinion
RSM Australia Partners
Level 13, 60 Castlereagh Street Sydney NSW 2000
GPO Box 5138 Sydney NSW 2001
T +61 (0) 2 8226 4500
F +61 (0) 2 8226 4501
www.rsm.com.au
We have audited the financial report of Metal Bank Limited (the Company) and its subsidiaries (the Group), which
comprises the consolidated statement of financial position as at 30 June 2020, the consolidated statement of
comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash
flows for the year then ended, and notes to the financial statements, including a summary of significant accounting
policies, and the directors' declaration.
In our opinion, except for the matter described in the Basis for Qualified Opinion section of our report, the
accompanying financial report of the Group is in accordance with the Corporations Act 2001, including:
(i) giving a true and fair view of the Group's financial position as at 30 June 2020 and of its financial
performance for the year then ended; and
(ii) complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for Qualified Opinion
Included in Note 8 is an asset classified as available-for-sale with a carrying value of $6,400,000 as at 30 June
2020. The carrying value has been determined after an impairment loss of 878,566 in the year under review. As
disclosed in Note 8, the sale transaction was concluded subsequent to year end for a variable consideration based
on staged payments upon the identification of future JORC Mineral Resource milestones. The receivable of $6.4m
recognised is the maximum amount that could be received under the arrangement. However, there is significant
judgement required with regards to the estimation of the future JORC milestones, and therefore the amount of
consideration that will be received. We were unable to obtain sufficient appropriate audit evidence about these
assumptions, and therefore about the recoverability or the carrying values of these assets. Consequently, we
were unable to determine whether any adjustments to these amounts were necessary.
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 confirm that the independence declaration required by the Corporations Act 2001, which has been given to
the directors of the Company, would be in the same terms if given to the directors as at the time of this auditor's
report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
qualified opinion.
THE POWER OF BEING UNDERSTOOD
AUDIT | TAX | CONSULTING
47
RSM Australia Partners is a member of the RSM network and trades as RSM. RSM is the trading name used by the members of the RSM network. Each member of the
RSM network is an independent accounting and consulting firm which practices in its own right. The RSM network is not itself a separate legal entity in any jurisdiction.
RSM Australia Partners ABN 36 965 185 036
Liability limited by a scheme approved under Professional Standards Legislation
Key Audit Matter
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 Basis for Qualified Opinion section, we have determined the matter
described below to be the key audit matter to be communicated in our report.
Key Audit Matter
How our audit addressed this matter
Carrying value of capitalised exploration and evaluation
Refer to Note 10 in the financial statements
As disclosed in Notes 10, the Group has capitalised
of
evaluation
and
exploration
$2,235,455 as at 30 June 2020.
expenditure
The carrying value of exploration and evaluation
assets is subjective based on the Group’s ability and
intention, to continue to explore and develop the
asset. The carrying value may also be impacted if
the mineral reserves and resources are not
commercially viable for extraction, or where the
carrying value of the asset is not likely to be
recouped through sale or successful development.
This creates a risk that the amounts stated in the
financial statements may not be recoverable.
Our audit procedures included the following:
Ensuring that the Group had the right to explore in
the relevant exploration area, which included
obtaining and assessing independent searches of
the company’s tenement holdings.
Assessing the Group’s intention to carry out
significant exploration and evaluation activity in the
relevant exploration area, which included an
assessment of the Group's future cash flow
forecasts, and enquiry of management and the
Board of Directors as to the intentions and strategy
of the Group.
Assessing the results of recent exploration activity
in the Group’s areas of interest, to determine if
there are any negative indicators that would
suggest a potential impairment of the capitalised
exploration and evaluation expenditure.
Assessing the Group’s ability to finance any
planned future exploration and evaluation activity.
Reviewing a sample of costs that were capitalised
to determine whether the costs were appropriate to
accordance with Australian
capitalise
Accounting Standards and
the consolidated
entity’s accounting policy.
in
48
Carrying value of held-for-sale exploration assets
Refer to Note 8 in the financial statements
Included in Note 8 is an asset classified as held-for-
sale with a carrying value of $6,400,000 as at 30
June 2020.
The carrying value has been determined after an
impairment loss of $878,566 in the year under
review. As disclosed in Note 8, the sale transaction
was concluded subsequent to the year end for a
variable consideration based on staged payments
upon the identification of future JORC Mineral
Resource milestones. The receivable of $6.4m
recognised is the maximum amount that could be
received under the arrangement. However, there is
significant judgement required with regards to the
estimation of the future JORC milestones, and
therefore the amount of consideration that will be
received.
Our audit procedures included the following:
Ensuring that the Group had the right to explore in
the relevant exploration area, which included
obtaining and assessing independent searches of
the company’s tenement holdings.
Assessing the results of recent exploration activity
in the Group’s areas of interest, to determine if
there are any negative indicators that would
suggest a potential impairment of the capitalised
exploration and evaluation expenditure.
Reviewing a sample of costs that were capitalised
to determine whether the costs were appropriate to
accordance with Australian
capitalise
Accounting Standards and
the consolidated
entity’s accounting policy.
in
Reviewing
the available documentation with
regards to the sale transaction that concluded
subsequent to the financial year end.
Testing
the accuracy of
for
impairment having consideration of the estimated
recoverable amount of the asset.
the provision
Critically evaluating the assumptions and other
available evidence in relation to managements
estimate with regards to the recoverable amount.
Reviewing the disclosures in the Annual Report
with regards to the held-for-sale asset and related
subsequent events disclosures.
Qualifying the Audit Report accordingly.
Other Information
The directors are responsible for the other information. The other information comprises the information included
in the Group's annual report for the year ended 30 June 2020, but does not include the financial report and the
auditor's report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not express any
form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information and, in doing
so, consider whether the other information is materially inconsistent with the financial report or our knowledge
obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact. We have nothing to report in this regard.
49
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 ability of the Group to continue as a going concern,
disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless
the directors either intend to liquidate the Group or to cease operations, or 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/ar2.pdf.
This description forms part of our auditor's report.
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 17 to 20 of the directors' report for the year ended
30 June 2020.
In our opinion, the Remuneration Report of Metal Bank Limited for the year ended 30 June 2020, complies with
section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the Remuneration Report
in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the
Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards.
RSM Australia Partners
Gary N Sherwood
Partner
Sydney NSW, dated 29 September 2020
50
METAL BANK LIMITED AND ITS CONTROLLED ENTITY
ADDITIONAL INFORMATION FOR LISTED COMPANIES
AS AT 27 SEPTEMBER 2020
The following additional information is required by the Australian Securities Exchange pursuant to Listing Rule
4.10. The information provided is current as at 27 September 2020 unless otherwise stated.
a. Distribution of Shareholders
Number held
1 – 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001+
Total
Number of
share holders
Number of
shares
% of number of
shares
43
11
44
447
770
2,395
24,478
422,039
25,844,615
1,158,214,777
1,315
1,184,508,304
0.00%
0.00%
0.04%
2.18%
97.78%
100.00%
b. The number of shareholders who hold less than a marketable parcel is 335.
c. Substantial shareholders
The names of the substantial shareholders in the Company, the number of equity securities to which
each substantial shareholder and substantial holder’s associates have a relevant interest, based on
substantial holding notices given to the Company are:
Indigo Pearl Capital Ltd
Celtic Stars Capital Ltd
Aristo Jet Capital Ltd
No of shares
107,880,780
61,183,283
66,340,682
Stella Adriatica (CI) Ltd
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