Mithril Resources Limited
ABN 30 099 883 922
Annual Report - 30 June 2019
Mithril Resources Limited
Contents
30 June 2019
Corporate directory
Directors' report
Auditor's independence declaration
Statement of profit or loss and other comprehensive income
Statement of financial position
Statement of changes in equity
Statement of cash flows
Notes to the financial statements
Directors' declaration
Independent auditor's report to the members of Mithril Resources Limited
Shareholder information
2
3
13
14
15
16
17
18
38
39
43
1
Mithril Resources Limited
Corporate directory
30 June 2019
Directors
Mr David Hutton (Managing Director)
Mr Stephen Layton (Non-Executive Director)
Mr Adrien Wing (Non-Executive Director)
Company secretary
Mr Adrien Wing
Registered office
C/- HLB Mann Judd (SA) Pty Ltd
169 Fullarton Road
DULWICH SA 5065
Principal place of business
22B Beulah Road
NORWOOD SA 5067
Share register
Auditor
Solicitors
Bankers
Computershare Investor Services Pty Ltd
Level 5, 115 Grenfell Street
ADELAIDE SA 5000
Grant Thornton Audit Pty Ltd
Level 3, 170 Frome Street
ADELAIDE SA 5000
Quinert Rodda & Associates
Level 6, 400 Collins Street
MELBOURNE VIC 3000
Bank of South Australia
97 King William Street
ADELAIDE SA 5000
Stock exchange listing
Mithril Resources Limited shares are listed on the Australian Securities Exchange
(ASX code: MTH)
Website
www.mithrilresources.com.au
2
Mithril Resources Limited
Directors' report
30 June 2019
The Directors present their report, together with the financial statements, on the consolidated entity (referred to hereafter
as the 'Group') consisting of Mithril Resources Limited (referred to hereafter as the 'Company' or 'Parent Entity') and the
entities it controlled at the end of, or during, the year ended 30 June 2019.
Information on Directors
The following persons were Directors of Mithril Resources Limited during the whole of the financial year and up to the date
of this report, unless otherwise stated:
Name:
Title:
Qualifications:
Experience and expertise:
David Hutton
Managing Director
BSc
David Hutton is a geologist who has spent the last 25 years working in both
exploration and mining throughout Australia and overseas. After graduation, he spent
7 years with the MIM Group before joining Forrestania Gold NL / LionOre Australia,
where he was involved in gold exploration throughout the WA Goldfields. He worked
at Western Metals as Chief Geologist of the Lennard Shelf Operations prior to re-
joining LionOre Australia where he was responsible for management of the East
Kimberley Nickel Joint Venture. Prior to commencing with the Company in June 2012,
David worked at Breakaway Resources where he was most recently Managing
Director from May 2010 to June 2012.
David is a Fellow of the AusIMM and a Member of the AIG.
N/A
Other current directorships:
Former directorships (last 3 years): N/A
Interests in shares:
Interests in options:
4,213,180 ordinary shares
700,000 unlisted options
Name:
Title:
Experience and expertise:
Other current directorships:
Mr Stephen Layton (Appointed 15 May 2019)
Non-Executive Director
Mr Layton has over 35 years' experience in equity capital markets in the UK and
Australia. Mr Layton has worked with various stockbroking firms and/or AFSL
regulated corporate advisory firms. Mr Layton specialised in capital raising services
and opportunities, corporate advisory, facilitation of ASX listings and assisting
companies grow.
Speciality Metals Int Ltd
New Age Exploration Ltd
Former directorships (last 3 years): N/A
Interests in shares:
Interests in options:
21,000,000 ordinary shares
None
Name:
Title:
Qualifications:
Experience and expertise:
Other current directorships:
Mr Adrien Wing (Appointed 15 May 2019)
Non-Executive Director
BA(Acc), CPA
Mr Wing is a certified practicing accountant. He previously practiced in the audit and
corporate advisory divisions of a chartered accounting firm before working with a
number of public companies listed on the ASX as a corporate and accounting
consultant and company secretary.
Red Sky Energy Ltd
High Grade Metals Ltd
Former directorships (last 3 years): N/A
Interests in shares:
Interests in options:
21,000,000 ordinary shares
None
3
Mithril Resources Limited
Directors' report
30 June 2019
Name:
Title:
Qualifications:
Experience and expertise:
Other current directorships:
Graham Ascough (Resigned 15 May 2019)
Non-Executive Chairman
BSc, PGeo
Graham Ascough is a senior resources executive with more than 25 years of industry
experience evaluating mineral projects and resources in Australia and overseas. He
has had broad industry involvement ranging from playing a leading role in setting the
strategic direction for significant country-wide exploration programmes to working
directly with mining and exploration companies.
Mr Ascough is a geophysicist by training and was the Managing Director of Mithril
Resources Ltd from October 2006 until June 2012. Prior to joining Mithril in 2006, Mr
Ascough was the Australian Manager of Nickel and PGM Exploration at the major
Canadian resources house, Falconbridge Ltd (acquired by Xstrata Plc in 2006).
He is a member of the Australian Institute of Mining and Metallurgy and is a
Professional Geoscientist of Ontario, Canada.
Musgrave Minerals Ltd
PNX Metals Ltd
Sunstone Metals Ltd (formerly Avalon Minerals Ltd)
Former directorships (last 3 years): N/A
Interests in shares:
Interests in options:
7,042,313 ordinary shares
None
Name:
Title:
Qualifications:
Experience and expertise:
Other current directorships:
Donald Stephens (Resigned 15 May 2019)
Non-Executive Director
BA(Acc), FCA
Donald Stephens is a Chartered Accountant and corporate advisor with over 30
years’ experience in the accounting, mining and services industries, including 14
years as a partner of HLB Mann Judd (SA), a firm of Chartered Accountants. He is a
Chartered Accountant and corporate adviser specialising in small cap ASX listed
entities.
Mr Stephens is a director of a number of ASX listed companies. Additionally, he is the
Company Secretary of Highfield Resources Limited, Duxton Water Limited and
various other listed and unlisted public companies.
Petratherm Limited
Gooroo Ventures Limited
Former directorships (last 3 years): Odin Metals Limited (formerly Lawson Gold Limited) (from July 2013 to February
Interests in shares:
Interests in options:
2018)
Papyrus Australia Limited (from September 2004 to August 2015)
RHS Limited (from July 2013 to July 2015)
5,506,351
None
'Other current directorships' quoted above are current directorships for listed entities only and excludes directorships of all
other types of entities, unless otherwise stated.
'Former directorships (last 3 years)' quoted above are directorships held in the last 3 years for listed entities only and
excludes directorships of all other types of entities, unless otherwise stated.
Principal activities
During the financial year the principal continuing activities of the Group consisted of:
●
●
●
to carry out exploration of mineral tenements, both on a joint venture basis and by the Group in its own right;
to continue to seek extensions of areas held and to seek out new areas with mineral potential; and
to evaluate results achieved through surface sampling, drilling and geophysical surveys carried out during the year.
There have been no significant changes in the nature of those activities during the year.
Dividends
There were no dividends paid, recommended or declared during the current or previous financial year.
4
Mithril Resources Limited
Directors' report
30 June 2019
Review of operations
The loss for the Group after providing for income tax amounted to $1,287,491 (30 June 2018: $1,048,164).
Mithril’s activities for the Year ending 30 June 2019 (the “Period”) largely comprised target generation activities across four
projects - the Billy Hills Zinc Project, the Kurnalpi Nickel Project and at The Nanadie Well Copper Project. In addition,
Mithril’s exploration partner defined a new vanadium drill target at Limestone Well.
Corporate Overview
Mithril raised $1.11M (before costs) through a Placement and a fully underwritten non-renounceable pro-rata rights issue at
an issue price of $0.005 (0.5 cents). Patersons Securities Ltd (“Patersons”) acted as Lead Manager to the placement and
the Rights Issue. Following the capital raising, Mithril had 422,389,211 Ordinary Shares on issue.
Following an Extraordinary General Meeting held during the June 2019 Quarter the Company’s Board of Directors now
comprises Mr David Hutton (Managing Director), Mr Adrien Wing (Non-Executive Director and Company Secretary) and Mr
Stephen Layton (Non-Executive Director).
Exploration Overview
Billy Hills Zinc Project (Mithril 100%)
Mithril is targeting large scale zinc + lead + silver deposits along strike from known mineralisation at Billy Hills (which is
located adjacent to the former Pillara Zinc Mine, 25 kms southeast of Fitzroy Crossing in Western Australia).
Pillara had a pre-mine resource of 18.05 million tonnes at 7.7% Zn and 2.4% Pb and produced 10.3 Mt @ 6.9% Zn, 2.3%
Pb from June 1997 to October 2003 (see Mithril’s ASX Announcement dated 21 August 2017).
During the Period, Mithril executed a Heritage Protection and Mineral Exploration Agreement with the project’s Traditional
Owners which paved the way for the grant of the project’s three Exploration Licences. Subsequent field work identified
high-grade surface mineralisation at the Firetail Zinc Prospect which lies within the southern project area.
At Firetail, rock chip samples collected along a 300 metre – long subcropping zone of siliceous gossan and weathered
colloform-banded sulphides returned assay values up to 30.3% zinc, 127g/t silver and 3.0% lead. The mineralisation
occurs within a broader fault zone and remains open along strike to the north.
Firetail is a priority for drill testing which the Company will seek to do as soon as possible.
Kurnalpi Nickel Project (Mithril 100%)
During the Period, Mithril identified a new copper-cobalt target at Kurnalpi (located 70 kms north east of Kalgoorlie in
Western Australia) which is in addition to the project’s established nickel sulphide prospectivity.
Grab sampling of remnant drill spoils from a historic drill hole within the eastern portion of the project returned up to 1.46%
copper and 1.12% cobalt. The mineralisation is hosted by a weakly weathered sheared mafic rock that lies between
carbonaceous metasediments to the east and outcropping gabbro to the west and warrants drill follow-up to better
understand its geological setting and potential significance.
Nanadie Well Copper Project (Mithril earning up to 75%)
Three-dimensional (3D) modelling of the Nanadie Well Copper Deposit undertaken during the Period has identified a new
high-grade target adjacent to the deposit which remains untested by geophysical surveying and / or drilling.
The Nanadie Well Copper Deposit (2004 JORC Code Compliant Inferred Resource of 36.07Mt @ 0.42% copper, 0.064 g/t
gold - 151,506 tonnes copper and 74,233 ounces gold estimated by Intermin Resources Limited in 2013) is located 80
kilometres southeast of Meekatharra, Western Australia.
The new target represents an opportunity to delineate additional higher-grade mineralisation which could in turn lead to an
increase in the deposit’s size and grade.
The Nanadie Well Deposit lies on a tenement subject to a Farmin and Joint Venture Agreement (Nanadie Well Joint
Venture) with Intermin Resources Limited (ASX: IRC) whereby Mithril can earn a 60% interest in the tenements by
completing expenditure of $2M by 14 October 2019, and an additional 15% by completing further expenditure of $2M over
a further 2 years.
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Mithril Resources Limited
Directors' report
30 June 2019
Limestone Well Vanadium Project (Mithril 100% and Auteco Minerals earning up to 80%)
Mithril has entered a Farm-in and Joint Venture Agreement with Auteco Minerals (previously Monax Mining) whereby
Auteco can to earn up to an 80% interest in Mithril’s Limestone Well tenements (EL’s 20/846 and 51/1069) by completing
exploration expenditure of $2.5M over 5 years.
The Limestone Well tenements (located 90 kilometres southeast of Meekatharra, Western Australia) lie immediately along
strike from the Barrambie Titanium Vanadium Deposit (2012 JORC Inferred + Indicated Resource of 280.1Mt @
9.18%TiO₂ and 0.44%V₂O₅ - Neometals Limited ASX Announcement dated 17 April 2018).
At Barrambie, the mineralisation occurs within a series of magnetite – bearing mafic rocks (anorthosite and gabbro) which
can be traced in regional magnetics for 10’s of kilometres strike both north and south of the deposit, including onto
Limestone Well.
During the Period Auteco identified a new drill target (along strike from Barrambie) based on positive results received from
a soil sampling program. A drilling program (fully funded by Auteco) to test the target is planned for the September 2019
Quarter.
Other Projects
The Company continues to develop and assess value-adding initiatives towards its following projects: Bangemall (Mithril
100%), Leaky Bore (Mithril 100%), Lignum Dam (Mithril 100%), and Coompana (Mithril right to earn 20% / OZ Minerals
100% and operating).
Due to a lack of prospectivity, the Duffy Well Project (Mithril 100%) was relinquished during the Period.
The Company also sold its 15% interest in the Spargos Reward Gold Project to Corona Minerals for $50,000 cash. Prior to
the sale agreement Corona Minerals was Mithril’s exploration partner at Spargos Reward and held an 85% interest in the
project.
The sale was in line with Mithril’s strategy of seeking exploration funding partners for and / or divesting low priority projects
to ensure that the Company remains focused on its 100% - owned Billy Hills Zinc Project.
Competent Persons Statement
The information in this report that relates to Exploration Targets, Exploration Results, Mineral Resources or Ore Reserves
is based on information compiled by Mr David Hutton, who is a Competent Person, and a Fellow of The Australasian
Institute of Mining and Metallurgy. Mr Hutton is Managing Director and a full-time employee of Mithril Resources Ltd.
Mr Hutton has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration
and to the activity being undertaken 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 Hutton consents to the inclusion in the report of the matters based on his information in the form and context in which it
appears.
Significant changes in the state of affairs
There were no significant changes in the state of affairs of the Group during the financial year.
Matters subsequent to the end of the financial year
No matter or circumstance has arisen since 30 June 2019 that has significantly affected, or may significantly affect the
Group's operations, the results of those operations, or the Group's state of affairs in future financial years.
Environmental regulation
The Group is aware of its responsibility to impact as little as possible on the environment, and where there is any
disturbance, to rehabilitate sites. During the year under review the majority of work carried out was in the Northern Territory
and Western Australia and the Group followed procedures and pursued objectives in line with guidelines published by the
Northern Territory/Western Australian Governments. These guidelines are quite detailed and encompass the impact on
owners and land users, heritage, health and safety and proper restoration practices. The Group supports this approach
and is confident that it properly monitors and adheres to these objectives, and any local conditions applicable wherever it
explores.
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Mithril Resources Limited
Directors' report
30 June 2019
The Group is committed to minimising environmental impacts during all phases of exploration, development and production
through a best practice environmental approach. The Group shares responsibility for protecting the environment for the
present and the future. It believes that carefully managed exploration programs should have little or no long-lasting impact
on the environment and the company has formed a best practice policy for the management of its exploration programs.
The Group properly monitors and adheres to this approach and there were no environmental incidents to report for the
year under review. Furthermore, the Group is in compliance with the state and/or commonwealth environmental laws for
the jurisdictions in which it operates.
Occupational Health, Safety and Welfare
In running its business, Mithril aims to protect the health, safety and welfare of employees, contractors and guests. In the
reporting period the Group experienced no medical aid incidents. The Group reviews its OHS&W policy at regular intervals
to ensure a high standard of OHS&W, and to reflect best practice in injury and accident prevention.
Company Secretary
Adrien Wing is the Company Secretary. He is also a Non-Executive Director of the Company.
Corporate Governance
In recognising the need for the highest standards of corporate behaviour and accountability, the Directors of Mithril
Resources Limited support and have adhered to the principles of sound corporate governance. The Board recognises the
recommendations of the Australian Securities Exchange Corporate Governance Council, and considers that Mithril
Resources is in compliance to the extent possible with those guidelines, which are of importance to the commercial
operation of a junior listed resources company. During the financial year, shareholders continued to receive the benefit of
an efficient and cost-effective corporate governance policy for the Company.
The Company has established a set of corporate governance policies and procedures and these can be found within the
Company’s Corporate Governance Statement located on the Company’s website:
www.mithrilresources.com.au/corporate-governance
Shares under option
At the date of this report, the following options to acquire ordinary shares in the Company were on issue:
Grant date
17/11/2017
22/06/2017
10/03/2017
17/11/2017
22/06/2017
10/10/2018
10/10/2018
Expiry date
17/11/2020
31/12/2020
31/12/2020
31/12/2020
22/06/2020
10/10/2021
10/10/2021
Exercise
price
Number
under option
$0.100
$0.100
$0.100
$0.100
$0.100
$0.010
$0.010
500,000
300,000
1,000,000
1,000,000
300,000
4,000,000
3,000,000
10,100,000
No person entitled to exercise the options had or has any right by virtue of the option to participate in any share issue of
the Company or of any other body corporate.
Shares issued on the exercise of options
There were no ordinary shares of Mithril Resources Limited issued on the exercise of options during the year ended 30
June 2019 and up to the date of this report.
Remuneration report (audited)
The remuneration report details the key management personnel remuneration arrangements for the Group, in accordance
with the requirements of the Corporations Act 2001 and its Regulations.
Key management personnel are those persons having authority and responsibility for planning, directing and controlling the
activities of the entity, directly or indirectly, including all directors. These are as follows:
7
Mithril Resources Limited
Directors' report
30 June 2019
David Hutton
Stephen Layton
Adrien Wing
Managing Director
Non-Executive Director
Non-Executive Director
Principles used to determine the nature and amount of remuneration
The Board is responsible for determining remuneration policies applicable to directors and senior executives of the Group.
The Board policy is to ensure that remuneration properly reflects the individuals' duties and responsibilities and that
remuneration is competitive in attracting, retaining and motivating people with appropriate skills and experience. At the time
of determining remuneration consideration is given by the Board to the Group's financial performance.
The Board currently determines the nature and amount of remuneration for board members and senior executives of the
Group. The policy is to align Director and executive objectives with shareholder and business objectives by providing a
fixed remuneration component and offering specific long‑term incentives.
The Non‑Executive Directors and other executives receive a superannuation guarantee contribution required by the
government, which is currently 9.5%, and do not receive any other retirement benefits. Some individuals, however, may
choose to sacrifice part of their salary to increase payments towards superannuation. All remuneration paid to directors
and executives is expensed as incurred. Executives are also entitled to participate in the Company share option scheme.
Options are valued using the Black‑Scholes methodology.
The Board policy is to remunerate Non‑Executive Directors at market rates based on comparable companies for time,
commitment and responsibilities. The board determines payments to non‑executive Directors and reviews their
remuneration annually, based on market practice, duties and accountability. Independent external advice is sought when
required.
There is no direct relationship between the remuneration policy and the entities performance.
Voting and comments made at the Company's 2018 Annual General Meeting ('AGM')
At the 2018 AGM, more than 88% of the votes received supported the adoption of the remuneration report for the year
ended 30 June 2018. The Company did not receive any specific feedback at the AGM regarding its remuneration practices.
Details of remuneration
Amounts of remuneration
Details of the remuneration of key management personnel of the Group are set out in the following tables.
2019
Non-Executive Directors:
Graham Ascough*
Donald Stephens*
Stephen Layton
Adrien Wing
Executive Directors:
David Hutton
Short-term
benefits
Post-
employment
benefits
Share-based
payments
Cash salary
and fees
$
Super-
annuation
$
Equity-
settled
$
Total
$
57,488
36,750
4,000
4,000
-
3,491
-
-
-
-
-
-
57,488
40,241
4,000
4,000
281,907
384,145
25,000
28,491
24,250
24,250
331,157
436,886
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Mithril Resources Limited
Directors' report
30 June 2019
2018
Non-Executive Directors:
Graham Ascough**
Donald Stephens**
Executive Directors:
David Hutton
Short-term
benefits
Post-
employment
benefits
Share-based
payments
Cash salary
and fees
$
Super-
annuation
$
Equity-
settled
$
Total
$
62,415
39,900
-
3,791
19,710
13,797
82,125
57,488
268,162
370,477
25,000
28,791
4,840
38,347
298,002
437,615
*
**
Mr Ascough and Mr Stephens resigned as directors on 15 May 2019
Share-based payments to Mr Ascough and Mr Stephens in 2018 were in lieu of unpaid directors fees
Service agreements
Remuneration and other terms of employment for key management personnel are formalised in service agreements.
Details of these agreements are as follows:
Name:
Title:
Agreement commenced:
Term of agreement:
Details:
Share-based compensation
David Hutton
Managing Director
18 June 2012
reviewed every three years
Mr Hutton's gross salary, inclusive of 9.5% superannuation guarantee, is $306,907.
The Company or the employee may terminate the employment contract without cause
by providing 6 months written notice or making payment in lieu of notice, based on
the annual salary component. Termination payments are generally not payable on
resignation or dismissal for serious misconduct. In the instance of serious misconduct
the Company can terminate employment at any time.
Issue of shares
There were no shares issued to Directors and other key management personnel as part of compensation during the year
ended 30 June 2019.
Options
The terms and conditions of each grant of options over ordinary shares affecting remuneration of Directors and other key
management personnel in this financial year or future reporting years are as follows:
Grant date
10/10/18
Vesting date and
exercisable date
10/10/18
Expiry date
10/10/2021
Options granted carry no dividend or voting rights.
Fair value
per option
Exercise price at grant date
$0.010
$0.006
9
Mithril Resources Limited
Directors' report
30 June 2019
The number of options over ordinary shares granted to and vested by Directors and other key management personnel as
part of compensation during the year ended 30 June 2019 are set out below:
Name
David Hutton
Number of
options
granted
during the
year
2019
Number of
options
granted
during the
year
2018
Number of
options
vested
during the
year
2019
Number of
options
vested
during the
year
2018
4,000,000
300,000
4,000,000
300,000
Details of options over ordinary shares granted, vested and lapsed for Directors and other key management personnel as
part of compensation during the year ended 30 June 2019 are set out below:
Name
Grant date
Vesting date
Number of
options
granted
Value of
options
granted
$
Value of
options
vested
$
Number of
options
lapsed
Value of
options
lapsed
$
David Hutton
10/10/2018
10/10/2018
4,000,000
24,250
24,250
-
-
The number of shares and options have been presented on a post shares and option consolidation basis.
Additional disclosures relating to key management personnel
Shareholding
The number of shares in the Company held during the financial year by each Director and other members of key
management personnel of the Group, including their personally related parties, is set out below:
Ordinary shares
Graham Ascough**
David Hutton*
Donald Stephens**
Stephen Layton
Adrien Wing
Balance at
the start of
the year
Received
as part of
remuneration
3,841,261
2,298,098
3,003,477
-
-
9,142,836
-
-
-
-
-
-
Acquired
3,201,052
1,915,082
2,502,874
21,000,000
21,000,000
49,619,008
Disposals/
other
-
-
-
-
-
-
Balance at
the end of
the year
7,042,313
4,213,180
5,506,351
21,000,000
21,000,000
58,761,844
Issue of fully paid ordinary shares on 20 December 2018 under the Non-Renounceable Rights Issue
*
** Mr Ascough and Mr Stephens resigned as directors on 15 May 2019
Option holding
The number of options over ordinary shares in the Company held during the financial year by each Director and other
members of key management personnel of the Group, including their personally related parties, is set out below:
Options over ordinary shares
David Hutton
Balance at
the start of
the year
Granted
Exercised
Expired/
forfeited/
other
Balance at
the end of
the year
700,000
700,000
4,000,000
4,000,000
-
-
-
-
4,700,000
4,700,000
Other transactions with key management personnel and their related parties
Mr A Wing is a director of Northern Star Nominees Pty Ltd (NSN). NSN has provided company secretarial services to the
company. During the financial year the Company incurred costs of $4,000 (2018: $Nil) from NSN. No amount was owing to
NSN at 30 June 2019.
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Mithril Resources Limited
Directors' report
30 June 2019
This concludes the remuneration report, which has been audited.
Meetings of Directors
The number of meetings of the Company's Board of Directors ('the Board') held during the year ended 30 June 2019, and
the number of meetings attended by each Director were:
Graham Ascough*
David Hutton
Donald Stephens*
Adrien Wing**
Stephen Layton**
Directors Meetings
Held
Attended
Audit Committee
Attended
Held
7
8
7
1
1
7
8
7
1
1
2
2
1
-
-
2
2
2
-
-
Held: represents the number of meetings held during the time the Director held office.
*
**
Resigned 15 May 2019
Appointed 15 May 2019
Indemnity and insurance of officers
The Group has made and agreement indemnifying all the Directors and Officers of the Company against all losses or
liabilities by each Director or Officer in their capacity as Directors or Officers of the Company to the extent permitted by the
Corporations Act 2001, the indemnification specifically excludes wilful acts of negligence.
The Company paid insurance premiums in respect of Directors’ and Officers’ Liability Insurance contracts for current
officers of the Company, including officers of the Company’s controlled entities. The liabilities insured are damages and
legal costs that may be incurred in defending civil or criminal proceeding that may be brought against the officers in their
capacity as officers of entities of the Group. The total amount of insurance premiums paid for the financial year was
$10,500 (2018: $6,671).
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 the Company
No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings on
behalf of the Company, or to intervene in any proceedings to which the Company is a party for the purpose of taking
responsibility on behalf of the Company for all or part of those proceedings.
Non-audit services
There were no non-audit services provided during the financial year by the auditor.
Auditor's independence declaration
A copy of the auditor's independence declaration as required under section 307C of the Corporations Act 2001 is set out
immediately after this Directors' report.
Auditor
Grant Thornton Audit Pty Ltd continues in office in accordance with section 327 of the Corporations Act 2001.
11
Mithril Resources Limited
Directors' report
30 June 2019
This report is made in accordance with a resolution of Directors, pursuant to section 298(2)(a) of the Corporations Act
2001.
On behalf of the Directors
___________________________
David Hutton
Managing Director
6 September 2019
12
Level 3, 170 Frome Street
Adelaide SA 5000
Correspondence to:
GPO Box 1270
Adelaide SA 5001
T +61 8 8372 6666
F +61 8 8372 6677
E info.sa@au.gt.com
W www.grantthornton.com.au
Auditor’s Independence Declaration
To the Directors of Mithril Resources Limited
In accordance with the requirements of section 307C of the Corporations Act 2001, as lead auditor for the audit of Mithril
Resources Limited for the year ended 30 June 2019, I declare that, to the best of my knowledge and belief, there have been:
a no contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
b no contraventions of any applicable code of professional conduct in relation to the audit.
GRANT THORNTON AUDIT PTY LTD
Chartered Accountants
B K Wundersitz
Partner – Audit & Assurance
Adelaide, 6 September 2019
Grant Thornton Audit Pty Ltd ACN 130 913 594
a subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389
www.grantthornton.com.au
‘Grant Thornton’ refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory services to their clients
and/or refers to one or more member firms, as the context requires. Grant Thornton Australia Ltd is a member firm of Grant Thornton International
Ltd (GTIL). GTIL and the member firms are not a worldwide partnership. GTIL and each member firm is a separate legal entity. Services are
delivered by the member firms. GTIL does not provide services to clients. GTIL and its member firms are not agents of, and do not obligate one
another and are not liable for one another’s acts or omissions. In the Australian context only, the use of the term ‘Grant Thornton’ may refer to
Grant Thornton Australia Limited ABN 41 127 556 389 and its Australian subsidiaries and related entities. GTIL is not an Australian related entity to
Grant Thornton Australia Limited.
Liability limited by a scheme approved under Professional Standards Legislation.
Mithril Resources Limited
Statement of profit or loss and other comprehensive income
For the year ended 30 June 2019
Revenue
Other income
Interest received
Profit on sale of tenement
Expenses
Operating expenses
Employee benefits expense
Depreciation and amortisation expense
Impairment of exploration assets
Finance costs
Loss before income tax expense
Income tax expense
Loss after income tax expense for the year
Other comprehensive income for the year, net of tax
Total comprehensive income for the year
Basic earnings per share
Diluted earnings per share
Note
5
6
11
12
7
17
27
27
Consolidated
2019
$
2018
$
-
1,045
1,079
5,651
50,000
776
5,805
-
(360,817)
(203,480)
(4,177)
(775,457)
(290)
(286,292)
(170,947)
(5,778)
(592,398)
(375)
(1,287,491)
(1,048,164)
-
-
(1,287,491)
(1,048,164)
-
-
(1,287,491)
(1,048,164)
Cents
Cents
(0.40)
(0.40)
(0.96)
(0.96)
The above statement of profit or loss and other comprehensive income should be read in conjunction with the
accompanying notes
14
Mithril Resources Limited
Statement of financial position
As at 30 June 2019
Assets
Current assets
Cash and cash equivalents
Trade and other receivables
Other assets
Total current assets
Non-current assets
Property, plant and equipment
Exploration and evaluation
Total non-current assets
Total assets
Liabilities
Current liabilities
Trade and other payables
Employee benefits
Total current liabilities
Total liabilities
Net assets
Equity
Issued capital
Reserves
Accumulated losses
Total equity
Consolidated
Note
2019
$
2018
$
8
9
10
11
12
13
14
631,215
50,640
27,146
709,001
863,770
1,458
11,287
876,515
14,341
1,910,014
1,924,355
18,518
2,064,854
2,083,372
2,633,356
2,959,887
34,053
73,777
107,830
47,013
65,570
112,583
107,830
112,583
2,525,526
2,847,304
15
16
17
37,303,102
124,496
(34,902,072)
36,379,826
152,059
(33,684,581)
2,525,526
2,847,304
The above statement of financial position should be read in conjunction with the accompanying notes
15
Mithril Resources Limited
Statement of changes in equity
For the year ended 30 June 2019
Consolidated
Balance at 1 July 2017
Loss after income tax expense for the year
Other comprehensive income for the year, net of tax
Total comprehensive income for the year
Transactions with Owners in their capacity as Owners:
Share-based payments (note 28)
Lapsed options
Shares issued
Transactions costs
Issued
capital
$
Reserves
$
Accumulated
losses
$
Total equity
$
34,824,778
215,400
(32,724,417)
2,315,761
-
-
-
-
-
-
(1,048,164)
-
(1,048,164)
-
(1,048,164)
(1,048,164)
33,507
-
1,719,892
(198,351)
24,659
(88,000)
-
-
-
88,000
-
-
58,166
-
1,719,892
(198,351)
Balance at 30 June 2018
36,379,826
152,059
(33,684,581)
2,847,304
Consolidated
Balance at 1 July 2018
Loss after income tax expense for the year
Other comprehensive income for the year, net of tax
Total comprehensive income for the year
Transactions with Owners in their capacity as Owners:
Share-based payments (note 28)
Lapsed options
Shares issued
Transactions costs
Issued
capital
$
Reserves
$
Accumulated
losses
$
Total equity
$
36,379,826
152,059
(33,684,581)
2,847,304
-
-
-
-
-
-
(1,287,491)
-
(1,287,491)
-
(1,287,491)
(1,287,491)
-
-
1,110,234
(186,958)
42,437
(70,000)
-
-
-
70,000
-
-
42,437
-
1,110,234
(186,958)
Balance at 30 June 2019
37,303,102
124,496
(34,902,072)
2,525,526
The above statement of changes in equity should be read in conjunction with the accompanying notes
16
Mithril Resources Limited
Statement of cash flows
For the year ended 30 June 2019
Cash flows from operating activities
Receipts from customers (inclusive of GST)
Payments to suppliers and employees (inclusive of GST)
Interest received
Other revenue
Interest and other finance costs paid
Net cash used in operating activities
Cash flows from investing activities
Receipts from joint arrangement partners
Payments for property, plant and equipment
Payments for exploration assets
Proceeds from disposal of investments
Net cash used in investing activities
Cash flows from financing activities
Proceeds from issue of shares
Share issue transaction costs
Net cash from financing activities
Net increase/(decrease) in cash and cash equivalents
Cash and cash equivalents at the beginning of the financial year
Consolidated
Note
2019
$
2018
$
4,777
(545,352)
4,794
(457,377)
(540,575)
5,651
(50,000)
(290)
(452,583)
5,805
-
(375)
26
(585,214)
(447,153)
11
12
-
-
(620,617)
50,000
1,045
(4,467)
(1,025,251)
-
(570,617)
(1,028,673)
15
15
1,110,234
(186,958)
1,719,892
(198,351)
923,276
1,521,541
(232,555)
863,770
45,715
818,055
Cash and cash equivalents at the end of the financial year
8
631,215
863,770
The above statement of cash flows should be read in conjunction with the accompanying notes
17
Mithril Resources Limited
Notes to the financial statements
30 June 2019
Note 1. General information
The financial statements cover Mithril Resources Limited ('the Company') as a Group consisting of Mithril Resources
Limited and the entities it controlled at the end of, or during, the year. The financial statements are presented in Australian
dollars, which is Mithril Resources Limited's functional and presentation currency.
Mithril Resources Limited is a listed public company limited by shares, incorporated and domiciled in Australia. Its
registered office and principal place of business are:
Registered office
Principal place of business
C/- HLB Mann Judd (SA) Pty Ltd
169 Fullarton Road
DULWICH SA 5065
22B Beulah Road
NORWOOD SA 5067
The financial statements were authorised for issue, in accordance with a resolution of Directors, on 6 September 2019.
Note 2. Significant accounting policies
The principal accounting policies adopted in the preparation
of the financial statements are set out either in the
respective notes or below. These policies have been
consistently applied to all the years presented, unless
otherwise stated.
New or amended Accounting Standards and
Interpretations adopted
The Group has adopted all of the new or amended
Accounting Standards and Interpretations issued by the
Australian Accounting Standards Board ('AASB') that are
mandatory for the current reporting period.
AASB 15 Revenue from Contracts with Customers and
AASB 9 Financial Instruments (2014) became effective for
periods beginning on or after 1 January 2018. Accordingly,
the Group applied AASB 15 and AASB 9 for the first time to
the period ended 30 June 2019. Changes to the Group’s
accounting policies arising
these standards are
summarised below:
from
The adoption of
these Accounting Standards and
Interpretations did not have any significant impact on the
financial performance or position of the Group.
The following Accounting Standards and Interpretations are
most relevant to the Group:
Instruments
AASB 9 Financial Instruments
replaces AASB 139
AASB 9 Financial
Financial
Instruments: Recognition and Measurement
requirements. It makes major changes to the previous
the classification and measurement of
guidance on
financial assets and introduces an ‘expected credit loss’
model for impairment of financial assets. When adopting
AASB 9, the Group has applied transitional relief and
elected not to restate prior periods. The adoption of AASB
9 has mostly impacted the following areas:
Classification and measurement of financial liabilities
As the accounting for financial liabilities remains largely
unchanged from AASB 139, the Group’s financial liabilities
were not impacted by the adoption of AASB 9.
AASB 15 Revenue from Contracts with Customers
AASB 15 replaces AASB 118 Revenue, AASB 111
Construction Contracts and several
revenue-related
Interpretations. The new Standard has been applied as at 1
January 2018. There is no impact to the Group’s historical
financial results given the company is not currently in
production.
Going concern
The financial report has been prepared on the basis of a
going concern. The financial report shows the Group
incurred a net loss of $1,287,491 (2018: $1,048,164) and a
net cash outflow from operating and investing activities of
$1,155,831 (2018: $1,475,826) during the year ended 30
June 2019. The Group continues to be economically
dependent on the generation of cashflow from the business
and/ or raising additional capital as and when required for
the continued operations including the exploration program
and the provision of working capital.
The Group’s ability to continue as a going concern is
contingent upon generation of cashflow from its business
and/ or successfully raising additional capital. If sufficient
cash flow is not generated and/or additional funds are not
raised, the going concern basis may not be appropriate,
with the result that the Group may have to realise its assets
and extinguish its liabilities, other than in the ordinary
course of business and at amounts different from those
stated in the financial report. No allowance for such
circumstances has been made in the financial report.
18
Mithril Resources Limited
Notes to the financial statements
30 June 2019
Note 2. Significant accounting policies (continued)
Basis of preparation
These general purpose financial statements have been
prepared
in accordance with Australian Accounting
Standards and Interpretations issued by the Australian
Accounting Standards Board ('AASB') and the Corporations
Act 2001, as appropriate for for-profit oriented entities.
These financial statements also comply with International
Financial Reporting Standards as
the
International Accounting Standards Board ('IASB').
issued by
Historical cost convention
The financial statements have been prepared under the
historical cost convention, except for, where applicable, the
revaluation of financial assets and liabilities at fair value
through profit or loss, financial assets at fair value through
other comprehensive
investment properties,
income,
certain classes of property, plant and equipment and
derivative financial instruments.
Critical accounting estimates
The preparation of the financial statements requires the use
of certain critical accounting estimates. It also requires
management to exercise its judgement in the process of
the Group's accounting policies. The areas
applying
involving a higher degree of judgement or complexity, or
areas where assumptions and estimates are significant to
the financial statements, are disclosed in note 3.
Parent entity information
In accordance with the Corporations Act 2001, these
financial statements present the results of the Group only.
Supplementary information about the parent entity is
disclosed in note 23.
Principles of consolidation
The consolidated financial statements incorporate the
assets and liabilities of all subsidiaries of Mithril Resources
Limited ('Company' or 'parent entity') as at 30 June 2019
and the results of all subsidiaries for the year then ended.
Mithril Resources Limited and its subsidiaries together are
referred to in these financial statements as the 'Group'.
Subsidiaries are all those entities over which the Group has
control. The Group controls an entity when the Group is
exposed to, or has rights to, variable returns from its
involvement with the entity and has the ability to affect
those returns through its power to direct the activities of the
entity. Subsidiaries are fully consolidated from the date on
which control is transferred to the Group. They are de-
consolidated from the date that control ceases.
transactions between entities
Intercompany transactions, balances and unrealised gains
on
the Group are
eliminated. Unrealised losses are also eliminated unless
the transaction provides evidence of the impairment of the
asset transferred. Accounting policies of subsidiaries have
been changed where necessary to ensure consistency with
the policies adopted by the Group.
in
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
Group'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 Group'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.
Deferred tax assets and liabilities are always classified as
non-current.
Joint Arrangement
AASB 11 Joint Arrangements defines a joint arrangement
as an arrangement of which two or more parties have joint
control and classifies these arrangements as either joint
ventures or joint operations.
Mithril Resources Ltd has determined that it has both joint
ventures and joint operations.
In relation to its joint venture operations, where the venturer
has the rights to the individual assets and obligations
arising from the arrangement, Mithril Resources Ltd has
recognised:
● Its assets, including its share of any assets held jointly;
● Its liabilities, including its share of any liabilities incurred
jointly;
● Its revenue from the sale of its share of the output arising
from the joint operation;
● Its share of the revenue from the sale of the output by
the joint operation;
● Its expenses, including its share of any expenses
incurred jointly.
These figures are incorporated into the relevant line item in
the primary statements.
19
for
to exceptions, a
lease prepayments,
AASB 16 Leases
This standard is applicable to annual reporting periods
beginning on or after 1 January 2019. The standard
replaces AASB 117 'Leases' and for lessees will eliminate
the classifications of operating leases and finance leases.
'right-of-use' asset will be
Subject
capitalised in the statement of financial position, measured
at the present value of the unavoidable future lease
payments to be made over the lease term. The exceptions
relate to short-term leases of 12 months or less and leases
of low-value assets (such as personal computers and small
office furniture) where an accounting policy choice exists
whereby either a 'right-of-use' asset is recognised or lease
payments are expensed to profit or loss as incurred. A
liability corresponding to the capitalised lease will also be
recognised, adjusted
lease
incentives received, initial direct costs incurred and an
estimate of any future restoration, removal or dismantling
costs. Straight-line operating lease expense recognition will
be replaced with a depreciation charge for the leased asset
(included in operating costs) and an interest expense on
the recognised lease liability (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 lease expenses under AASB 117. However
EBITDA (Earnings Before Interest, Tax, Depreciation and
Amortisation) results will be improved as the operating
expense is replaced by interest expense and depreciation
in profit or loss under AASB 16. For classification within the
statement of cash flows, the lease payments will be
separated into both a principal (financing activities) and
interest (either operating or financing activities) component.
For lessor accounting, the standard does not substantially
change how a lessor accounts for leases. The Group will
adopt this standard from 1 July 2019. The adoption of this
standard will not impact the Group's historical financial
results given there is less than 1 year remaining on the
Group's current lease commitments.
Mithril Resources Limited
Notes to the financial statements
30 June 2019
Note 2. Significant accounting policies (continued)
Impairment of non-financial assets
Goodwill and other intangible assets that have an indefinite
useful life are not subject to amortisation and are tested
annually for impairment, or more frequently if events or
changes in circumstances indicate that they might be
impaired. Other non-financial assets are reviewed for
impairment whenever events or changes in circumstances
indicate that the carrying amount may not be recoverable.
An impairment loss is recognised for the amount by which
the asset's carrying amount exceeds
its recoverable
amount.
Recoverable amount is the higher of an asset's fair value
less costs of disposal and value-in-use. The value-in-use is
the present value of the estimated future cash flows relating
to the asset using a pre-tax discount rate specific to the
asset or cash-generating unit to which the asset belongs.
Assets that do not have independent cash flows are
grouped together to form a cash-generating unit.
Goods and Services Tax ('GST') and other similar taxes
Revenues, expenses and assets are recognised net of the
amount of associated GST, unless the GST incurred is not
recoverable from the tax authority. In this case it is
recognised as part of the cost of the acquisition of the asset
or as part of the expense.
Receivables and payables are stated inclusive of the
amount of GST receivable or payable. The net amount of
GST recoverable from, or payable to, the tax authority is
included in other receivables or other payables in the
statement of financial position.
Cash flows are presented on a gross basis. The GST
components of cash
investing or
financing activities which are recoverable from, or payable
to the tax authority, are presented as operating cash flows.
flows arising
from
Commitments and contingencies are disclosed net of the
amount of GST recoverable from, or payable to, the tax
authority.
New Accounting Standards and Interpretations not yet
mandatory or early adopted
Australian Accounting Standards and Interpretations that
have recently been issued or amended but are not yet
mandatory, have not been early adopted by the Group for
the annual reporting period ended 30 June 2019. The
Group's assessment of the impact of these new or
amended Accounting Standards and Interpretations, most
relevant to the Group, are set out below.
20
Mithril Resources Limited
Notes to the financial statements
30 June 2019
Note 3. Critical accounting judgements, estimates and assumptions
The preparation of the financial statements requires management to make judgements, estimates and assumptions that
affect the reported amounts in the financial statements. Management continually evaluates its judgements and estimates in
relation to assets, liabilities, contingent liabilities, revenue and expenses. Management bases its judgements, estimates
and assumptions on historical experience and on other various factors, including expectations of future events,
management believes to be reasonable under the circumstances. The resulting accounting judgements and estimates will
seldom equal the related actual results. The judgements, estimates and assumptions that have a significant risk of causing
a material adjustment to the carrying amounts of assets and liabilities (refer to the respective notes) within the next
financial year are discussed below.
Capitalisation of exploration and evaluation expenditure
The Group's policy for exploration and evaluation is discussed in Note 12. The application of this policy requires
management to make certain assumptions as to future events and circumstances. Any such estimates and assumptions
may change as new information becomes available. If, after having capitalised exploration and evaluation expenditure,
management concludes that the capitalised expenditure is unlikely to be recovered by future sale or exploration, then the
relevant capitalised amount will be written off through the consolidated statement of profit or loss and other comprehensive
income.
Share-based payment transactions
The Group measures the cost of equity-settled transactions with employees by reference to the fair value of the equity
instruments at the date at which they are granted. The fair value is determined by using either the Binomial or Black-
Scholes model taking into account the terms and conditions upon which the instruments were granted. The accounting
estimates and assumptions relating to equity-settled share-based payments would have no impact on the carrying amounts
of assets and liabilities within the next annual reporting period but may impact profit or loss and equity.
Recovery of deferred tax assets
Deferred tax assets are recognised for deductible temporary differences only if the Group considers it is probable that
future taxable amounts will be available to utilise those temporary differences and losses.
Note 4. Operating segments
The Board has considered the requirements of AASB 8 Operating Segments and the internal reports that are reviewed by
the chief operating decision maker (the Board) in allocating resources and has concluded at this time that there are no
separately identifiable segments.
Note 5. Revenue
Administration fees
Consolidated
2019
$
2018
$
-
1,045
Adminstration fees
Administration fees are recognised on an accruals basis when the Group is entitled to it.
Interest
Interest revenue is recognised as interest accrues using the effective interest method. This is a method of calculating the
amortised cost of a financial asset and allocating the interest income over the relevant period using the effective interest
rate, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset
to the net carrying amount of the financial asset.
Other revenue
Other revenue is recognised when it is received or when the right to receive payment is established.
21
Mithril Resources Limited
Notes to the financial statements
30 June 2019
Note 6. Operating expenses
Professional fees
Annual report and AGM
ASX and ASIC fees
Audit fees
Communication expenses
Computer expenses
Occupancy costs
Insurance
Legal costs
Office expenses
Share registry charges
Travel expenses
Promotion and advertising
Shareholder Meetings
Other expenses
Transfer (to) exploration assets
Note 7. Income tax
Numerical reconciliation of income tax expense and tax at the statutory rate
Loss before income tax expense
Tax at the statutory tax rate of 30%
Tax effect amounts which are not deductible/(taxable) in calculating taxable income:
Expenses not allowable for income tax purposes
Other deductible items
Current year tax losses not recognised
Income tax expense
Consolidated
2019
$
2018
$
85,270
30,356
23,906
30,624
7,677
11,987
59,855
20,077
12,532
11,407
19,473
2,838
7,182
65,050
13,858
(41,275)
81,920
29,247
26,561
25,356
7,257
15,291
58,787
20,767
3,118
10,605
21,244
2,388
1,208
-
19,133
(36,590)
360,817
286,292
Consolidated
2019
$
2018
$
(1,287,491)
(1,048,164)
(386,247)
(314,449)
249,210
(218,914)
188,630
(326,805)
(355,951)
355,951
(452,624)
452,624
-
-
The Group has tax losses arising in Australia of $36,039,948 (2018: $34,853,444) that may be available and may be offset
against future taxable profits. In addition, these tax losses can only be utilised in the future if the continuity of ownership
test is passed, or failing that, the same business test is passed.
No deferred tax asset has been recognised because it is not likely future assessable income is derived of a nature and of
an amount sufficient to enable the benefit to be realised.
Accounting policy for income tax
The income tax expense or benefit for the period is the tax payable on that period's taxable income based on the
applicable income tax rate for each jurisdiction, adjusted by the changes in deferred tax assets and liabilities attributable to
temporary differences, unused tax losses and the adjustment recognised for prior periods, where applicable.
22
Mithril Resources Limited
Notes to the financial statements
30 June 2019
Note 7. Income tax (continued)
Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected to be applied when
the assets are recovered or liabilities are settled, based on those tax rates that are enacted or substantively enacted,
except for:
● When the deferred income tax asset or liability arises from the initial recognition of goodwill or an asset or liability in a
transaction that is not a business combination and that, at the time of the transaction, affects neither the accounting
nor taxable profits; or
● When the taxable temporary difference is associated with interests in subsidiaries, associates or joint ventures, and
the timing of the reversal can be controlled and it is probable that the temporary difference will not reverse in the
foreseeable future.
Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that
future taxable amounts will be available to utilise those temporary differences and losses.
The carrying amount of recognised and unrecognised deferred tax assets are reviewed at each reporting date. Deferred
tax assets recognised are reduced to the extent that it is no longer probable that future taxable profits will be available for
the carrying amount to be recovered. Previously unrecognised deferred tax assets are recognised to the extent that it is
probable that there are future taxable profits available to recover the asset.
Deferred tax assets and liabilities are offset only where there is a legally enforceable right to offset current tax assets
against current tax liabilities and deferred tax assets against deferred tax liabilities; and they relate to the same taxable
authority on either the same taxable entity or different taxable entities which intend to settle simultaneously.
Mithril Resources Ltd and its wholly owned Australian resident entities are part of a tax consolidated group under the tax
consolidation legislation as of 1 July 2007.
The head entity within the tax‑consolidated group is Mithril Resources Ltd. Mithril Resources Ltd and each of its
wholly‑owned controlled entities recognise the current and deferred tax assets and deferred tax liabilities applicable to the
transactions undertaken by it, after elimination of intra‑group transactions. Mithril Resources Ltd recognises the entire
tax‑consolidated group's retained tax losses.
Note 8. Cash and cash equivalents
Cash on hand
Cash at bank
Short-term deposits
Consolidated
2019
$
2018
$
-
626,215
5,000
100
853,670
10,000
631,215
863,770
Cash at bank earns interest at floating rates based on daily bank deposit rates.
$5,000 of short-term bank deposits acts as security for visa cards and the billflex facility.
Short-term deposits are made for varying periods of between one day and six months, depending on the immediate cash
requirements of the Company, and earn interest at the respective short-term deposit rates.
Accounting policy for cash and cash equivalents
Cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other short-term, highly
liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and
which are subject to an insignificant risk of changes in value.
23
Mithril Resources Limited
Notes to the financial statements
30 June 2019
Note 9. Trade and other receivables
Trade receivables
Consolidated
2019
$
2018
$
50,640
1,458
Trade receivables are non‑interest bearing and are generally on 30‑90 day terms. An allowance for doubtful debts is made
when there is objective evidence that a trade receivable is impaired. No impairment was recognised in the current and prior
financial year and no receivables are past due at balance date
Accounting policy for 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 allowance for expected credit losses. Trade receivables are generally due for settlement within
30 days.
Collectability of trade receivables is reviewed on an ongoing basis. Debts which are known to be uncollectable are written
off by reducing the carrying amount directly. A provision for impairment of trade receivables is raised when there is
objective evidence that the Group will not be able to collect all amounts due according to the original terms of the
receivables. Significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy or financial
reorganisation and default or delinquency in payments (more than 90 days overdue) are considered indicators that the
trade receivable may be impaired. The amount of the impairment allowance is the difference between the asset's carrying
amount and the present value of estimated future cash flows, discounted at the original effective interest rate. Cash flows
relating to short-term receivables are not discounted if the effect of discounting is immaterial.
Note 10. Other assets
Accrued revenue
Prepayments
Note 11. Property, plant and equipment
Plant and equipment - at cost
Less: Accumulated depreciation
Consolidated
2019
$
2018
$
32
27,114
86
11,201
27,146
11,287
Consolidated
2019
$
2018
$
284,282
(269,941)
284,282
(265,764)
14,341
18,518
24
Mithril Resources Limited
Notes to the financial statements
30 June 2019
Note 11. Property, plant and equipment (continued)
Reconciliations
Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out
below:
Consolidated
Balance at 1 July 2017
Additions
Depreciation expense
Balance at 30 June 2018
Depreciation expense
Balance at 30 June 2019
Plant and
equipment
$
19,829
4,467
(5,778)
18,518
(4,177)
Total
$
19,829
4,467
(5,778)
18,518
(4,177)
14,341
14,341
Accounting policy for property, plant and equipment
Land and buildings are shown at fair value, based on periodic, at least every 3 years, valuations by external independent
valuers, less subsequent depreciation and impairment for buildings. The valuations are undertaken more frequently if there
is a material change in the fair value relative to the carrying amount. Any accumulated depreciation at the date of
revaluation is eliminated against the gross carrying amount of the asset and the net amount is restated to the revalued
amount of the asset. Increases in the carrying amounts arising on revaluation of land and buildings are credited in other
comprehensive income through to the revaluation surplus reserve in equity. Any revaluation decrements are initially taken
in other comprehensive income through to the revaluation surplus reserve to the extent of any previous revaluation surplus
of the same asset. Thereafter the decrements are taken to profit or loss.
Plant and equipment is stated at historical cost less accumulated depreciation and impairment. Historical cost includes
expenditure that is directly attributable to the acquisition of the items.
Depreciation is calculated on a diminishing value basis to write off the net cost of each item of property, plant and
equipment (excluding land) over their expected useful lives. The depreciation rates used for each class of depreciable
asset are shown below:
Plant and equipment
Fixtures and fittings
Office equipment
10% - 40%
10% - 20%
20% - 40%
The residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each reporting
date.
An item of property, plant and equipment is derecognised upon disposal or when there is no future economic benefit to the
Group. Gains and losses between the carrying amount and the disposal proceeds are taken to profit or loss. Any
revaluation surplus reserve relating to the item disposed of is transferred directly to retained profits.
Note 12. Exploration and evaluation
Exploration and evaluation - joint operations
Exploration and evaluation - other
25
Consolidated
2019
$
2018
$
1,114,703
795,311
1,109,006
955,848
1,910,014
2,064,854
Mithril Resources Limited
Notes to the financial statements
30 June 2019
Note 12. Exploration and evaluation (continued)
Reconciliations
Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out
below:
Consolidated
Balance at 1 July 2017
Additions through expenditures capitalised
Impairment of tenements
Relinquished tenements*
Balance at 30 June 2018
Additions through expenditures capitalised
Impairment of tenements
Joint
Operations
$
1,078,131
570,000
-
(316,736)
1,331,395
93,523
(83,467)
Other
$
Total
$
553,870
455,251
(16,666)
(258,996)
733,459
527,094
(691,990)
1,632,001
1,025,251
(16,666)
(575,732)
2,064,854
620,617
(775,457)
Balance at 30 June 2019
1,341,451
568,563
1,910,014
*
write-off of capitalised exploration expenditures for the tenements that were relinquished during the year
The recoverability of the carrying amount of the exploration and evaluation assets is dependent on successful development
and commercial exploitation, or alternatively, sale of the respective areas of interest.
The recoverable amount of development expenditure is determined as the higher of its fair value less costs to sell and its
value in use.
Exploration and Evaluation expenditure has been carried forward to the extent that they are expected to be recouped
through the successful development or sale of the area or where activities in the area have not yet reached a stage that
permits reasonable assessment of the existence of economically recovered reserves. Management assessment of carried
forward expenditure resulted in impairment charges of $775,457 (2018: $16,666).
Accounting policy for exploration and evaluation assets
Exploration and evaluation expenditure in relation to separate areas of interest for which rights of tenure are current is
carried forward as an asset in the statement of financial position where it is expected that the expenditure will be recovered
through the successful development and exploitation of an area of interest, or by its sale; or exploration activities are
continuing in an area and activities have not reached a stage which permits a reasonable estimate of the existence or
otherwise of economically recoverable reserves. Where a project or an area of interest has been abandoned, the
expenditure incurred thereon is written off in the year in which the decision is made.
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. When provisions for closure and rehabilitation are initially recognised, the corresponding cost is
capitalised as an asset representing part of the cost of acquiring the future economic benefits of the operation. The
capitalised cost of closure and rehabilitation activities is recognised in property, plant and equipment and depreciated
accordingly. The value of the provision is progressively increased over time as the effect of discounting unwinds, creating
an expense which is recognised in finance costs. 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 discounted to their present value.
Any changes in the estimates for the costs are accounted on a prospective basis in the consolidated statement of profit or
loss and other comprehensive income. In determining the costs of site restoration, there is an 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 restoration will be completed within one year of abandoning the site
26
Mithril Resources Limited
Notes to the financial statements
30 June 2019
Note 13. Trade and other payables
Trade payables
Other payables
Consolidated
2019
$
2018
$
22,154
11,899
32,249
14,764
34,053
47,013
Refer to note 18 for further information on financial instruments.
Accounting policy for trade and other payables
These amounts represent liabilities for goods and services provided to the Group 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.
Note 14. Employee benefits
Annual leave
Long service leave
Consolidated
2019
$
2018
$
17,585
56,192
14,711
50,859
73,777
65,570
Accounting policy for employee benefits
Short-term employee benefits
Liabilities for wages and salaries, including non-monetary benefits, annual leave and long service leave expected to be
settled wholly within 12 months of the reporting date are measured at the amounts expected to be paid when the liabilities
are settled.
Note 15. Issued capital
Ordinary shares - fully paid
422,389,211
200,342,380
37,303,102
36,379,826
Consolidated
2019
Shares
2018
Shares
2019
$
2018
$
27
Mithril Resources Limited
Notes to the financial statements
30 June 2019
Note 15. Issued capital (continued)
Movements in ordinary share capital
Details
Date
Shares
Issue price
$
Balance
Shares issued via placement
Shares issued to Directors as remuneration
Share consolidation
Shares issued via placement
Shares issued via SPP
Shares issued via placement
Transaction costs (net of tax)
Balance
Shares issued via placement
Shares issued via rights issue
Transaction costs (net of tax)
1 July 2017
6 September 2017
17 November 2017
21 November 2017
2 January 2018
26 June 2018
28 June 2018
30 June 2018
21 November 2018
20 December 2018
848,103,831
127,215,574
11,169,000
(887,839,391)
24,662,252
36,962,639
40,068,475
-
200,342,380
30,051,357
191,995,474
-
Balance
30 June 2019
422,389,211
$0.002
$0.003
$0.000
$0.026
$0.011
$0.011
$0.000
$0.005
$0.005
$0.000
34,824,778
254,441
33,507
-
641,218
395,500
428,733
(198,351)
36,379,826
150,257
959,977
(186,958)
37,303,102
Ordinary shares
Ordinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the Company in
proportion to the number of and amounts paid on the shares held. The fully paid ordinary shares have no par value and the
Company does not have a limited amount of authorised capital.
On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each
share shall have one vote.
Share buy-back
There is no current on-market share buy-back.
Capital risk management
The Group's objectives when managing capital is to safeguard its ability to continue as a going concern, so that it can
provide returns for shareholders and benefits for other stakeholders and to maintain an optimum capital structure to reduce
the cost of capital.
Capital is regarded as total equity, as recognised in the statement of financial position, plus net debt. Net debt is calculated
as total borrowings less cash and cash equivalents.
Proceeds from share issues are used to maintain and expand the Company’s exploration activities and fund operating
costs.
Accounting policy for issued capital
Ordinary shares are classified as equity.
Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax,
from the proceeds.
Note 16. Reserves
Share options reserve
Consolidated
2019
$
2018
$
124,496
152,059
28
Mithril Resources Limited
Notes to the financial statements
30 June 2019
Note 16. Reserves (continued)
Share-based payments reserve
The reserve is used to recognise the value of equity benefits provided to employees and Directors as part of their
remuneration, and other parties as part of their compensation for services.
Movements in reserves
Movements in each class of reserve during the current and previous financial year are set out below:
Consolidated
Balance at 1 July 2017
Issue of options
Lapsed options
Balance at 30 June 2018
Issue of options
Lapsed options
Balance at 30 June 2019
Note 17. Accumulated losses
Accumulated losses at the beginning of the financial year
Loss after income tax expense for the year
Transfer from options reserve
Accumulated losses at the end of the financial year
Note 18. Financial instruments
Share options
reserve
$
Total
$
215,400
24,659
(88,000)
152,059
42,437
(70,000)
215,400
24,659
(88,000)
152,059
42,437
(70,000)
124,496
124,496
Consolidated
2019
$
2018
$
(33,684,581)
(1,287,491)
70,000
(32,724,417)
(1,048,164)
88,000
(34,902,072)
(33,684,581)
Financial risk management objectives
The Group's activities expose it to a variety of financial risks: market risk, credit risk and liquidity risk. The Group's overall
risk management program focuses on the unpredictability of financial markets and seeks to minimise potential adverse
effects on the financial performance of the Group. The Group uses different methods to measure different types of risk to
which it is exposed. These methods include sensitivity analysis in the case of interest rate and ageing analysis for credit
risk.
Risk management is carried out by the Board of Directors ('the Board'). These policies include identification and analysis of
the risk exposure of the Group and appropriate procedures, controls and risk limits. The Board identifies, evaluates and
hedges financial risks within the Group's operating units.
Market risk
Interest rate risk
The Company is exposed to interest rate risk as it holds some bank deposits at floating rates.
The Company's policy is to minimise interest rate cash flow risk exposures on long‑term financing. Longer‑term deposits
are therefore usually at fixed rates. At the reporting date, the Company is exposed to changes in market interest rates
through its bank deposits, which are subject to variable interest rates.
29
Mithril Resources Limited
Notes to the financial statements
30 June 2019
Note 18. Financial instruments (continued)
The effective weighted average interest rates on classes of financial assets and financial liabilities is as follows:
Consolidated
Cash and cash equivalents
Trade and other payables
Net exposure to cash flow interest rate risk
2019
2018
Weighted
average
interest rate
%
0.76%
-
Weighted
average
interest rate
%
0.78%
-
Balance
$
631,217
(34,053)
597,164
Balance
$
863,770
(47,013)
816,757
The following table illustrates the sensitivity of the net result for the year and equity to a reasonably possible change in
interest rates with effect from the beginning of the year. These changes are considered to be reasonably possible based on
observation of current market conditions.
Consolidated - 2019
Basis points increase
Effect on
profit before
tax
Basis points
change
Effect on
equity
Basis points
change
Basis points decrease
Effect on
profit before
tax
Effect on
equity
Cash and cash equivalents
50
2,952
2,952
(50)
(2,952)
2,952
Consolidated - 2018
Basis points increase
Effect on
profit before
tax
Basis points
change
Effect on
equity
Basis points
change
Basis points decrease
Effect on
profit before
tax
Effect on
equity
Cash and cash equivalents
50
4,112
4,112
(50)
(4,112)
4,112
Credit risk
The Group has adopted a lifetime expected loss allowance in estimating expected credit losses to trade receivables
through the use of a provisions matrix using fixed rates of credit loss provisioning. These provisions are considered
representative across all customers of the Group based on recent sales experience, historical collection rates and forward-
looking information that is available.
Generally, trade receivables are written off when there is no reasonable expectation of recovery. Indicators of this include
the failure of a debtor to engage in a repayment plan, no active enforcement activity and a failure to make contractual
payments for a period greater than 1 year.
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in a financial loss to the
Company. The Company has adopted a policy of only dealing with creditworthy counterparties as a means of mitigating the
risk of financial loss from activities. The Company does not have any significant credit risk exposure to any single
counterparty or any company of counterparties having similar characteristics. The credit risk on liquid funds is limited
because the counterparties are banks with high credit‑ratings assigned by international credit‑rating agencies. The carrying
amount of financial assets recorded in the financial statements, net of any allowances for losses, represents the
Company’s maximum exposure to credit risk.
Liquidity risk
Liquidity risk arises from the Company’s management of working capital and the finance charges and principal repayments
on its debt instruments. It is the risk that the Company will encounter difficulty in meeting its financial obligations as they fall
due.
Ultimate responsibility for liquidity risk management rests with the Board of Directors, whom have built an appropriate
liquidity risk management framework for the management of the Company’s short, medium and long‑term funding and
liquidity management requirements. The Company manages liquidity risk by maintaining adequate reserves
30
Mithril Resources Limited
Notes to the financial statements
30 June 2019
Note 19. Key management personnel disclosures
Compensation
The aggregate compensation made to Directors and other members of key management personnel of the Group is set out
below:
Short-term employee benefits
Post-employment benefits
Share-based payments
Share based payments consisted of the following:
●
4,000,000 share options issued to the Managing Director
Consolidated
2019
$
2018
$
384,145
28,491
24,250
370,477
28,791
38,347
436,886
437,615
Full details of option holdings of Directors are disclosed in the Remuneration Report contained within the Directors' Report.
Other transactions with key management personnel
Mr A Wing is a director of Northern Star Nominees Pty Ltd (NSN). NSN has provided company secretarial services to the
company. During the financial year the Company incurred costs of $4,000 (2018: $Nil) from NSN. No amount was owing to
NSN at 30 June 2019.
Note 20. Remuneration of auditors
During the financial year the following fees were paid or payable for services provided by Grant Thornton Audit Pty Ltd, the
auditor of the Company:
Audit services - Grant Thornton Audit Pty Ltd
Audit or review of the financial statements
Note 21. Capital and leasing commitments
Capital commitments
Committed at the reporting date but not recognised as liabilities, payable:
Exploration and evaluation*
Lease commitments - operating**
Committed at the reporting date but not recognised as liabilities, payable:
Within one year
One to five years
31
Consolidated
2019
$
2018
$
30,624
25,356
Consolidated
2019
$
2018
$
559,000
321,730
56,153
-
53,993
56,153
56,153
110,146
Mithril Resources Limited
Notes to the financial statements
30 June 2019
Note 21. Capital and leasing commitments (continued)
*
**
In order to maintain current rights of tenure to exploration tenements, the Company is required to meet minimum
expenditure requirements in respect of tenement lease rentals. These obligations are expected to be fulfilled in the
normal course of operations.
The Company has operating leases in place for its principal place of business which has a term of 2 years. The terms
of renewal have an escalation clause linked to CPI.
Note 22. Related party transactions
Parent entity
Mithril Resources Limited is the parent entity.
Subsidiaries
Interests in subsidiaries are set out in note 24.
Transactions between Mithril Resources Ltd and its wholly owned entities during the year consisted of loans advanced by
Mithril Resources Ltd to fund exploration and investment activities.
Key management personnel
Disclosures relating to key management personnel are set out in note 19 and the remuneration report included in the
Directors' report.
Transactions with related parties
There were no transactions with related parties during the current and previous financial year other than those disclosed in
note 19.
Receivable from and payable to related parties
There were no trade receivables from or trade payables to related parties at the current and previous reporting date.
Loans to/from related parties
There were no loans to or from related parties at the current and previous reporting date.
Note 23. Parent entity information
Set out below is the supplementary information about the parent entity.
Statement of profit or loss and other comprehensive income
Loss after income tax
Other comprehensive income for the year, net of tax
Total comprehensive income
Parent
2019
$
2018
$
(2,276,577)
(1,048,164)
-
-
(2,276,577)
(1,048,164)
32
Mithril Resources Limited
Notes to the financial statements
30 June 2019
Note 23. Parent entity information (continued)
Statement of financial position
Total current assets
Total non-current assets
Total assets
Total current liabilities
Total non-current liabilities
Total liabilities
Net assets
Equity
Issued capital
Share options reserve
Accumulated losses
Total equity
Parent
2019
$
2018
$
2,619,015
2,941,369
14,341
18,518
2,633,356
2,959,887
107,830
112,583
-
-
107,830
112,583
2,525,526
2,847,304
37,303,102
124,496
(34,902,072)
36,379,826
152,059
(33,684,581)
2,525,526
2,847,304
Guarantees entered into by the parent entity in relation to the debts of its subsidiaries
The parent entity had no guarantees in relation to the debts of its subsidiaries as at 30 June 2019 and 30 June 2018.
Contingent liabilities
The parent entity had no contingent liabilities as at 30 June 2019 and 30 June 2018.
Significant accounting policies
The accounting policies of the parent entity are consistent with those of the Group, as disclosed in note 2, except for the
following:
●
●
●
Investments in subsidiaries are accounted for at cost, less any impairment, in the parent entity.
Investments in associates are accounted for at cost, less any impairment, in the parent entity.
Dividends received from subsidiaries are recognised as other income by the parent entity and its receipt may be an
indicator of an impairment of the investment.
Note 24. Interests in subsidiaries
The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in
accordance with the accounting policy described in note 2:
Name
Principal place of business /
Country of incorporation
Minex (Aust) Pty Ltd
Minex (West) Pty Ltd
Mithril Resources Investments Pty Ltd
Australia
Australia
Australia
Ownership interest
2018
2019
%
%
100%
100%
100%
100%
100%
100%
*
The percentage of ownership interest held is equivalent to the percentage voting rights for all subsidiaries.
33
Mithril Resources Limited
Notes to the financial statements
30 June 2019
Note 25. Events after the reporting period
No matter or circumstance has arisen since 30 June 2019 that has significantly affected, or may significantly affect the
Group's operations, the results of those operations, or the Group's state of affairs in future financial years.
Note 26. Cash flow information
Reconciliation of loss after income tax to net cash used in operating activities
Loss after income tax expense for the year
(1,287,491)
(1,048,164)
Consolidated
2019
$
2018
$
Adjustments for:
Depreciation and amortisation
Impairment
Share-based payments
Net gain on disposal of non-current assets
Revenue - non-cash
Other revenue - non-cash
Change in operating assets and liabilities:
Increase in trade and other receivables
Decrease in accrued revenue
Decrease/(increase) in prepayments
Increase in other operating assets
Decrease in trade and other payables
Increase in employee benefits
4,177
775,457
42,437
(50,000)
-
-
(49,182)
54
(15,913)
-
(12,960)
8,207
5,778
592,398
58,166
-
1,821
(1,821)
(1,458)
1,933
3,701
(1,045)
(62,127)
3,665
Net cash used in operating activities
(585,214)
(447,153)
Note 27. Earnings per share
Loss after income tax
Consolidated
2019
$
2018
$
(1,287,491)
(1,048,164)
Number
Number
Weighted average number of ordinary shares used in calculating basic earnings per share
320,141,086
108,886,358
Weighted average number of ordinary shares used in calculating diluted earnings per share
320,141,086
108,886,358
Basic earnings per share
Diluted earnings per share
Accounting policy for earnings per share
Cents
Cents
(0.40)
(0.40)
(0.96)
(0.96)
Basic earnings per share
Basic earnings per share is calculated by dividing the profit attributable to the Owners of Mithril Resources Limited,
excluding any costs of servicing equity other than ordinary shares, by the weighted average number of ordinary shares
outstanding during the financial year, adjusted for bonus elements in ordinary shares issued during the financial year.
34
Mithril Resources Limited
Notes to the financial statements
30 June 2019
Note 27. Earnings per share (continued)
Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account
the after income tax effect of interest and other financing costs associated with dilutive potential ordinary shares and the
weighted average number of shares assumed to have been issued for no consideration in relation to dilutive potential
ordinary shares.
Note 28. Share-based payments
The Group established the Mithril Resources Ltd Employee Share Option Plan and a summary of the Rules of the Plan are
set out below:
●
All employees (full and part time) will be eligible to participate in the Plan after a qualifying period of 12 months
employment, although the Board may waive this requirement.
●
●
●
●
●
●
●
Options are granted under the Plan at the discretion of the Board and if permitted by the Board, may be issued to an
employee's nominee.
Each option is to subscribe for one fully paid ordinary share in the Company and will expire 5 years from its date of
issue. An option is exercisable at any time from its date of issue. Options will be issued free. The exercise price of
options will be determined by the Board, subject to a minimum price equal to the market value of the Company's
shares at the time the Board resolves to offer those options. The total number of shares, the subject of options issued
under the Plan, when aggregated with issues during the previous 5 years pursuant to the Plan and any other
employee share plan, must not exceed 5% of the Company's issued share capital.
If, prior to the expiry date of options, a person ceases to be an employee of the Company for any reason other than
retirement at age 60 or more (or such earlier age as the board permits), permanent disability, redundancy or death,
the options held by that person (or that person's nominee) automatically lapse on the first to occur of a) the expiry of
the period of 6 months from the date of such occurrence, and b) the expiry date. If a person dies, the options held by
that person will be exercisable by that person's legal personal representative.
Options can’t be transferred other than to the legal personal representative of a deceased option holder.
The Company will not apply for official quotation of any options issued under the plan.
Shares issued as a result of the exercise of options will rank equally with the Company's previously issued shares.
Option holders may only participate in new issues of securities by first exercising their options.
The Board may amend the Plan Rules subject to the requirements of the Listing Rules.
Set out below are summaries of options granted under the plan:
2019
Grant date
Expiry date
22/07/2013
20/06/2014
20/06/2014
21/04/2016
10/03/2017
22/06/2017
22/06/2017
17/11/2017
17/11/2017
10/10/2018
21/07/2018
21/07/2018
19/06/2019
21/04/2019
31/12/2020
31/12/2020
22/06/2022
17/11/2020
31/12/2020
10/10/2021
Exercise
price
Balance at
the start of
the year
Granted
Exercised
-
-
-
-
-
-
-
-
-
7,000,000
7,000,000
$0.000
$0.000
$0.000
$0.000
$0.000
$0.000
$0.000
$0.000
$0.000
$0.010
30,000
75,000
140,000
650,000
1,000,000
300,000
300,000
500,000
1,000,000
-
3,995,000
35
Expired/
forfeited/
other
Balance at
the end of
the year
(30,000)
(75,000)
(140,000)
(650,000)
-
-
-
-
-
-
(895,000)
-
-
-
-
1,000,000
300,000
300,000
500,000
1,000,000
7,000,000
10,100,000
-
-
-
-
-
-
-
-
-
-
-
Mithril Resources Limited
Notes to the financial statements
30 June 2019
Note 28. Share-based payments (continued)
2018
Grant date
Expiry date
29/11/2012
29/11/2012
31/07/2012
22/07/2013
20/06/2014
20/06/2014
21/04/2016
10/03/2017
22/06/2017
22/06/2017
17/11/2017
17/11/2017
28/11/2017
28/11/2017
30/07/2017
21/07/2018
21/07/2018
19/06/2019
21/04/2019
31/12/2020
31/12/2020
22/06/2022
17/11/2020
31/12/2020
Exercise
price
Balance at
the start of
the year
Granted
Exercised
$1.000
$1.500
$1.000
$0.500
$0.500
$0.150
$0.050
$0.100
$0.100
$0.100
$0.100
$0.100
100,000
100,000
70,000
30,000
75,000
140,000
650,000
1,000,000
300,000
300,000
-
-
2,765,000
-
-
-
-
-
-
-
-
-
-
500,000
1,000,000
1,500,000
Expired/
forfeited/
other
Balance at
the end of
the year
(100,000)
(100,000)
(70,000)
-
-
-
-
-
-
-
-
-
(270,000)
-
-
-
30,000
75,000
140,000
650,000
1,000,000
300,000
300,000
500,000
1,000,000
3,995,000
-
-
-
-
-
-
-
-
-
-
-
-
-
Weighted average exercise price
$0.212
$0.100
$0.000
$1.185
$0.104
Set out below are the options exercisable at the end of the financial year:
Grant date
Expiry date
22/07/2013
20/06/2014
20/06/2014
21/04/2016
10/03/2017
22/06/2017
22/06/2017
17/11/2017
17/11/2017
10/10/2018
21/07/2018
21/07/2018
19/06/2019
21/04/2019
31/12/2020
31/12/2020
22/06/2022
17/11/2020
31/12/2020
10/10/2021
2019
Number
2018
Number
-
-
-
-
1,000,000
300,000
300,000
500,000
1,000,000
7,000,000
30,000
75,000
140,000
650,000
1,000,000
300,000
300,000
500,000
1,000,000
-
10,100,000
3,995,000
The weighted average remaining contractual life of options outstanding at the end of the financial year was 1.8 years
(2018: 2.21 years).
For the options granted during the current financial year, the valuation model inputs used to determine the fair value at the
grant date, are as follows:
Grant date
Expiry date
Share price
at grant date
Exercise
price
Expected
volatility
Dividend
yield
Risk-free
interest rate
Fair value
at grant date
10/10/2018
10/10/2021
$0.008
$0.010
114.400%
-
2.570%
$0.006
36
Mithril Resources Limited
Notes to the financial statements
30 June 2019
Note 28. Share-based payments (continued)
Share-based payments during the year are:
Shares issued to Directors
Options issued to Directors, employees and consultants
Consolidated
2019
$
2018
$
-
42,437
33,507
24,659
42,437
58,166
Accounting policy for share-based payments
Equity-settled and cash-settled share-based compensation benefits are provided to employees.
Equity-settled transactions are awards of shares, or options over shares, that are provided to employees in exchange for
the rendering of services. Cash-settled transactions are awards of cash for the exchange of services, where the amount of
cash is determined by reference to the share price.
The cost of equity-settled transactions are measured at fair value on grant date. Fair value is independently determined
using either the Binomial or Black-Scholes option pricing model that takes into account the exercise price, the term of the
option, the impact of dilution, the share price at grant date and expected price volatility of the underlying share, the
expected dividend yield and the risk free interest rate for the term of the option, together with non-vesting conditions that do
not determine whether the Group receives the services that entitle the employees to receive payment. No account is taken
of any other vesting conditions.
The cost of equity-settled transactions are recognised as an expense with a corresponding increase in equity over the
vesting period. The cumulative charge to profit or loss is calculated based on the grant date fair value of the award, the
best estimate of the number of awards that are likely to vest and the expired portion of the vesting period. The amount
recognised in profit or loss for the period is the cumulative amount calculated at each reporting date less amounts already
recognised in previous periods.
The cost of cash-settled transactions is initially, and at each reporting date until vested, determined by applying either the
Binomial or Black-Scholes option pricing model, taking into consideration the terms and conditions on which the award was
granted. The cumulative charge to profit or loss until settlement of the liability is calculated as follows:
●
during the vesting period, the liability at each reporting date is the fair value of the award at that date multiplied by the
expired portion of the vesting period.
from the end of the vesting period until settlement of the award, the liability is the full fair value of the liability at the
reporting date.
●
All changes in the liability are recognised in profit or loss. The ultimate cost of cash-settled transactions is the cash paid to
settle the liability.
Market conditions are taken into consideration in determining fair value. Therefore any awards subject to market conditions
are considered to vest irrespective of whether or not that market condition has been met, provided all other conditions are
satisfied.
If equity-settled awards are modified, as a minimum an expense is recognised as if the modification has not been made.
An additional expense is recognised, over the remaining vesting period, for any modification that increases the total fair
value of the share-based compensation benefit as at the date of modification.
If the non-vesting condition is within the control of the Group or employee, the failure to satisfy the condition is treated as a
cancellation. If the condition is not within the control of the Group or employee and is not satisfied during the vesting
period, any remaining expense for the award is recognised over the remaining vesting period, unless the award is forfeited.
If equity-settled awards are cancelled, it is treated as if it has vested on the date of cancellation, and any remaining
expense is recognised immediately. If a new replacement award is substituted for the cancelled award, the cancelled and
new award is treated as if they were a modification.
37
Mithril Resources Limited
Directors' declaration
30 June 2019
In the Directors' opinion:
●
●
●
●
the attached financial statements and notes comply with the Corporations Act 2001, the Accounting Standards, the
Corporations Regulations 2001 and other mandatory professional reporting requirements;
the attached financial statements and notes comply with International Financial Reporting Standards as issued by the
International Accounting Standards Board as described in note 2 to the financial statements;
the attached financial statements and notes give a true and fair view of the Group's financial position as at 30 June
2019 and of its performance for the financial year ended on that date; and
there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due
and payable.
The Directors have been given the declarations required by section 295A of the Corporations Act 2001.
Signed in accordance with a resolution of Directors made pursuant to section 295(5)(a) of the Corporations Act 2001.
On behalf of the Directors
___________________________
David Hutton
Managing Director
6 September 2019
38
Level 3, 170 Frome Street
Adelaide SA 5000
Correspondence to:
GPO Box 1270
Adelaide SA 5001
T +61 8 8372 6666
F +61 8 8372 6677
E info.sa@au.gt.com
W www.grantthornton.com.au
Independent Auditor’s Report
To the Members of Mithril Resources Limited
Report on the audit of the financial report
Opinion
We have audited the financial report of Mithril Resources Limited (the Company) and its subsidiaries (the Group), which
comprises the consolidated statement of financial position as at 30 June 2019, the consolidated statement of profit or loss
and other comprehensive income, consolidated statement of changes in equity and consolidated statement of cash flows
for the year then ended, and notes to the consolidated financial statements, including a summary of significant accounting
policies, and the Directors’ declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act 2001, including:
a giving a true and fair view of the Group’s financial position as at 30 June 2019 and of its performance for the year
ended on that date; and
b complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are
further described in the Auditor’s Responsibilities for the Audit of the Financial Report section of our report. We are
independent of the Group in accordance with the auditor independence requirements of the Corporations Act 2001 and
the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for
Professional Accountants (the Code) that are relevant to our audit of the financial report in Australia. We have also fulfilled
our other ethical responsibilities in accordance with the Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Grant Thornton Audit Pty Ltd ACN 130 913 594
a subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389
www.grantthornton.com.au
‘Grant Thornton’ refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory services to their clients
and/or refers to one or more member firms, as the context requires. Grant Thornton Australia Ltd is a member firm of Grant Thornton International
Ltd (GTIL). GTIL and the member firms are not a worldwide partnership. GTIL and each member firm is a separate legal entity. Services are
delivered by the member firms. GTIL does not provide services to clients. GTIL and its member firms are not agents of, and do not obligate one
another and are not liable for one another’s acts or omissions. In the Australian context only, the use of the term ‘Grant Thornton’ may refer to
Grant Thornton Australia Limited ABN 41 127 556 389 and its Australian subsidiaries and related entities. GTIL is not an Australian related entity to
Grant Thornton Australia Limited.
Liability limited by a scheme approved under Professional Standards Legislation.
Material uncertainty related to going concern
We draw attention to Note 2 in the financial statements, which indicates that the Group incurred a net loss of $1,287,491
during the year ended 30 June 2019, and as of that date, the Group’s net cash outflows from operating and investing activities
of $1,155,831. As stated in Note 2, these events or conditions, along with other matters as set forth in Note 2, indicate that a
material uncertainty exists that may cast doubt on the Group’s ability to continue as a going concern. Our opinion is not
modified in respect of this matter.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial
report of the current period. These matters were addressed in the context of our audit of the financial report as a whole, and in
forming our opinion thereon, and we do not provide a separate opinion on these matters.
In addition to the matter described in the material uncertainty related to going concern section, we have determined the
matters described below to be the key audit matters to be communicated in our report.
Key audit matter
How our audit addressed the key audit matter
Exploration and evaluation assets - Notes 3 & 12
At 30 June 2019 the carrying value of exploration and
evaluation assets was $1,910,014.
In accordance with AASB 6 Exploration for and Evaluation of
Mineral Resources, the Group is required to assess at each
reporting date if there are any triggers for impairment which
may suggest the carrying value is in excess of the recoverable
value.
The process undertaken by management to assess whether
there are any impairment triggers in each area of interest
involves an element of management judgement.
This area is a key audit matter due to the significant
judgement involved in determining the existence of
impairment triggers.
Our procedures included, amongst others:
• obtaining the management reconciliation of capitalised
exploration and evaluation expenditure and agreeing to the
general ledger;
•
reviewing management’s area of interest considerations
against AASB 6;
• conducting a detailed review of management’s
assessment of trigger events prepared in accordance with
AASB 6 including;
−
tracing projects to statutory registers, exploration
licenses and third party confirmations to determine
whether a right of tenure existed;
− enquiry of management regarding their intentions to
carry out exploration and evaluation activity in the
relevant exploration area, including review of
management’s budgeted expenditure;
− understanding whether any data exists to suggest that
the carrying value of these exploration and evaluation
assets are unlikely to be recovered through
development or sale;
• assessing the accuracy of impairment recorded for the
year as it pertained to exploration interests;
• evaluating the competence, capabilities and objectivity of
management’s experts in the evaluation of potential
impairment triggers; and
• assessing the appropriateness of the related financial
statement disclosures.
Information other than the financial report and auditor’s report thereon
The Directors are responsible for the other information. The other information comprises the information included in the
Group’s annual report for the year ended 30 June 2019, but does not include the financial report and our auditor’s report
thereon.
Our opinion on the financial report does not cover the other information and we do not express any form of assurance
conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information and, in doing so, consider
whether the other information is materially inconsistent with the financial report or our knowledge obtained in the audit or
otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are
required to report that fact. We have nothing to report in this regard.
Responsibilities of the Directors’ for the financial report
The Directors of the Company are responsible for the preparation of the financial report that gives a true and fair view in
accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the Directors
determine is necessary to enable the preparation of the financial report that gives a true and fair view and is free from material
misstatement, whether due to fraud or error.
In preparing the financial report, the Directors are responsible for assessing the Group’s ability to continue as a going concern,
disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the
Directors either intend to liquidate the Group or to cease operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material
misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance
is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian Auditing
Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions
of users taken on the basis of this financial report.
A further description of our responsibilities for the audit of the financial report is located at the Auditing and Assurance
Standards Board website at: http://www.auasb.gov.au/auditors_responsibilities/ar1.pdf. This description forms part of our
auditor’s report.
Report on the remuneration report
Opinion on the remuneration report
We have audited the Remuneration Report included in pages 7 to 10 of the Directors’ report for the year ended 30 June
2019.
In our opinion, the Remuneration Report of Mithril Resources Limited, for the year ended 30 June 2019 complies with
section 300A of the Corporations Act 2001.
Responsibilities
The Directors of the Company are responsible for the preparation and presentation of the Remuneration Report in accordance
with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the Remuneration Report,
based on our audit conducted in accordance with Australian Auditing Standards.
GRANT THORNTON AUDIT PTY LTD
Chartered Accountants
B K Wundersitz
Partner – Audit & Assurance
Adelaide, 6 September 2019
Mithril Resources Limited
Shareholder information
30 June 2019
The shareholder information set out below was applicable as at 3 September 2019.
Distribution of equitable securities
Analysis of number of equitable security holders by size of holding:
1 to 1,000
1,001 to 5,000
5,001 to 10,000
10,001 to 100,000
100,001 and over
Holding less than a marketable parcel
Equity security holders
Twenty largest quoted equity security holders
The names of the twenty largest security holders of quoted equity securities are listed below:
JENNINGS FAMILY INVESTMENTS PTY LTD
BODIE INVESTMENTS PTY LTD
NORTHERN STAR NOMINEES PTY LTD
COVENANT HOLDINGS (WA) PLY LTD
MGL CORP PTY LTD
LJT INVESTMENTS PTY LTD
ALLTIME NOMINEES PTY LTD
SCINTILLA STRATEGIC INVESTMENTS LIMITED
IBT HOLDINGS PTY LTD
MR GRAHAM LESLIE ASCOUGH & MRS PATRICIA LYNN ASCOUGH
MR HARLEY LEONARD DALTON & MRS PRUDENCE MAREE DALTON
DCS SUPER FUND PTY LTD
MR GARRY WILLIAM CLARIDGE & MRS KELLY ANN CLARIDGE
ESM LIMITED
DR BARBARA GLIGORIJEVIC
MR VINCENZO BRIZZI & MRS RITA LUCIA BRIZZI
113 MIMOSA PTY LTD
MRS HUI WANG
MR DAVID JAMES HUTTON & MRS RACHEL MARIE HUTTON
MR BENJAMIN M HAGE
Share buy-back
There is no current on-market share buy-back.
43
Number
of holders
of options
over
ordinary
shares
Number
of holders
of ordinary
shares
325
348
188
555
329
1,745
1,347
-
-
-
-
5
5
-
Ordinary shares
Number held
% of total
shares
issued
21,100,000
21,000,000
21,000,000
20,000,000
18,261,870
18,170,847
11,395,597
10,000,000
8,403,900
7,042,313
6,002,786
5,506,321
5,358,875
5,000,000
5,000,000
4,301,870
4,234,448
4,227,203
4,213,180
4,188,061
5.00
4.97
4.97
4.73
4.32
4.30
2.70
2.37
1.99
1.67
1.42
1.30
1.27
1.18
1.18
1.02
1.00
1.00
1.00
0.99
204,407,271
48.38
Mithril Resources Limited
Shareholder information
30 June 2019
Unquoted equity securities
Options over ordinary shares issued
Substantial holders
There are no substantial holders in the Company.
Voting rights
The voting rights attached to equity securities are set out below:
Number
on issue
Number
of holders
10,100,000
5
Ordinary shares
On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each
share shall have one vote.
Options
No voting rights.
There are no other classes of equity securities.
List of tenements
Project
Bangemall
Bangemall
Huckitta
Kurnalpi Area
Kurnalpi Area
Kurnalpi Area
Kurnalpi Area
Lignum Dam Area
Lignum Dam Area
Lignum Dam Area
Murchison Area
Murchison Area
Murchison Area
Neutral Junction
West Kimberley Area
West Kimberley Area
West Kimberley Area
* In application stage
Tenement number
Interest
owned %
100.00
-
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
-
33.30
100.00
100.00
100.00
E09/2315
E52/3644 *
EL26942
E28/2506
E28/2567
E28/2682
E28/2760
E27/538
E27/582
E27/584
E20/846
E57/1069
EL51/1040
EL24253
E04/2497
E04/2503
E80/5191
44