Metalicity Limited
For the year ended 30 June 2020
Corporate Directory
Directors
Mathew Longworth – Non-executive Chairman
Jason Livingstone – Managing Director
Justin Barton – Finance Director
Andrew Daley – Non-executive Director
Company Secretary
Nick Day (appointed 24 September 2020)
Neil Hackett (resigned 23 September 2020)
Auditors
Stantons International
Level 2
1 Walker Avenue
West Perth WA 6005
Solicitors
Steinepreis Paganin
Level 4, The Read Buildings
16 Milligan Street
Perth WA 6000
Bankers
ANZ
Cnr Hay and Outram Street
West Perth WA 6005
Registered Office
Level 25,
108 St Georges Terrace
Perth WA 6000
Telephone:
Facsimile:
+61 8 9324 1053
+61 8 9324 3366
Share Registry
Link Market Services Limited
Level 14
152 St Georges Terrace
Perth WA 6000
Investor Enquiries:
Facsimile:
1300 554 474
(02) 9287 0303
Securities Exchange Listing
Securities of Metalicity Limited are listed on the Australian Securities Exchange (ASX).
ASX Code: MCT
Web Site: www.metalicity.com.au
1
Contents
Directors’ report
Corporate Governance Statement
Auditor’s independence declaration
Independent auditor’s report
Directors’ declaration
Annual financial statements
Consolidated statement of profit or loss and other comprehensive income
Consolidated statement of financial position
Consolidated statement of changes in equity
Consolidated statement of cash flows
Notes to the financial statements
Australian Securities Exchange (ASX) Additional Information
Page
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36
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39
40
68
2
Directors’ Report
The Directors of Metalicity Limited submit herewith the annual financial report of the Company and its
subsidiaries (the “Group”) for the financial year ended 30 June 2020.
Directors
The names and particulars of the Directors of the Company during or since the end of the financial year
are:
Name
Particulars
Mathew Longworth Non-Executive Chairman (appointed Chairman on 1 July 2019)
Jason Livingstone Managing Director (appointed 1 July 2019)
Justin Barton
Finance Director
Andrew Daley
Non-Executive Director (resigned as Chairman on 1 July 2019)
The above-named Directors held office during and since the financial year, except as otherwise
indicated.
Principal Activities
The Group’s principal activity as at the date of this report is mineral exploration and development of the
Kookynie and Yundamindra Gold Projects that the Company is earning into from Nex Metals Explorations
Ltd.
Review of Operations and Results
Throughout the year the Company completed a strategic review of its mineral projects and refocussed
Metalicity’s activities no driving shareholder value by concentrating on the Kookynie and Yundamindra gold
projects. The outcome of this new focus has been immediate and highly encouraging.
Kookynie & Yundamindra Gold Projects
On the 6th May 2019 the Company announced it had entered into a farm-in agreement with Nex Metals (ASX:
NEX) for the Kookynie and Yundamindra projects, which sees Metalicity enter the Eastern Goldfields to
explore for precious metals.
Under the agreement with Nex Metals the Company has the right to farm-in to the projects for an initial spend
of $500,000 within the first 12 months with the right to earn a 51% interest in the projects by spending a total
of $5 million within five years.
As of 31 August 2020, the Company had spent a total of ~$1.6m at the projects through exploration
programmes as well as the purchase of (i) an additional prospecting tenement adjacent to the Champion
Lease and (ii) two farm in agreements & (iii) tenement applications within the area.
The Kookynie and Yundamindra Projects are located approximately 180km north of the town of Kalgoorlie
and present an opportunity to develop a high-grade gold resource based off historic exploration within the
area.
The Kookynie project hosts the historical mining centres of Diamantina-Cosmopolitan-Cumberland, known
as the DCC trend, as well as McTavish, Leipold, Champion and Altona.
Each of the historic mining operations were highly successful, with the Cosmopolitan gold mine producing
360,000 ounces of gold from discovery from 1895 to 1922. During the early part of last century, the
Cosmopolitan mine ranked as one of the largest and most profitable gold mines in Western Australia.
These former mining operations have remained untested by modern exploration, particularly the potentially
rich plunge extensions of the main mineralised shoots.
3
A JORC 2012 compliant Exploration Target was announced on the 12th March 2020 based off previous
production and exploration work.
Directors’ Report
Prospect
Diamantina-Cosmopolitan-Cumberland (DCC) Trend
Diamantina-Cosmopolitan-Cumberland (DCC) Trend
Diamantina-Cosmopolitan-Cumberland (DCC) Trend
Diamantina-Cosmopolitan-Cumberland (DCC) Trend
Diamantina-Cosmopolitan-Cumberland (DCC) Trend
Diamantina-Cosmopolitan-Cumberland (DCC) Trend
previously excluded area of underground development
previously excluded area of underground development
previously excluded area of underground development
previously excluded area of underground development
previously excluded area of underground development
Overall Ounce Range
Overall Ounce Range
Overall Ounce Range
Overall Ounce Range
Overall Ounce Range
Overall Ounce Range
The Champion Prospect
The Champion Prospect
The Champion Prospect
The Champion Prospect
The Champion Prospect
The Champion Prospect
The Champion Prospect
The Champion Prospect
The Champion Prospect
The Champion Prospect
The Champion Prospect
previously excluded area of underground development
previously excluded area of underground development
previously excluded area of underground development
previously excluded area of underground development
previously excluded area of underground development
previously excluded area of underground development
Overall Ounce Range
The McTavish Prospect
The McTavish Prospect
The McTavish Prospect
The McTavish Prospect
The McTavish Prospect
The McTavish Prospect
The McTavish Prospect
The McTavish Prospect
The McTavish Prospect
The McTavish Prospect
The McTavish Prospect
The McTavish Prospect
previously excluded area of underground development
previously excluded area of underground development
previously excluded area of underground development
previously excluded area of underground development
previously excluded area of underground development
previously excluded area of underground development
previously excluded area of underground development
previously excluded area of underground development
previously excluded area of underground development
previously excluded area of underground development
Overall Ounce Range
Overall Ounce Range
Overall Ounce Range
Overall Ounce Range
Overall Ounce Range
Overall Ounce Range
Overall Ounce Range
The Leipold Prospect
The Leipold Prospect
The Leipold Prospect
The Leipold Prospect
The Leipold Prospect
The Leipold Prospect
The Leipold Prospect
The Leipold Prospect
The Leipold Prospect
The Leipold Prospect
The Leipold Prospect
The Leipold Prospect
The Leipold Prospect
The Leipold Prospect
The Leipold Prospect
previously excluded area of underground development
previously excluded area of underground development
previously excluded area of underground development
previously excluded area of underground development
previously excluded area of underground development
previously excluded area of underground development
Overall Ounce Range
Overall Ounce Range
Overall Ounce Range
Overall Ounce Range
Overall Ounce Range
Overall Ounce Range
Kookynie Gold Project "Exploration Target" Summation
Grade Range
Tonnage Range
Lower g/t Au Upper g/t Au Lower tonnes Upper Tonnes
600,000
1,000,000
300,000
600,000
10.0
6.0
15.0
10.0
3.6
2.0
1.8
1.5
1.5
1.5
6.0
4.0
5.0
5.0
5.0
4.0
200,000
60,000
250,000
100,000
500,000
100,000
400,000
150,000
500,000
200,000
800,000
200,000
Ounces
Lower ounce range Upper Ounce Range
100,000
115,000
215,000
25,000
4,000
29,000
15,000
5,000
20,000
25,000
5,000
30,000
290,000
320,000
610,000
80,000
20,000
100,000
80,000
32,000
112,000
120,000
25,000
145,000
Table 1 – Kookynie Gold Project Exploration Target(1)
(1) Please note the “Exploration Target” cautionary statement: The potential quantity and grade is
conceptual in nature and there has been insufficient exploration to estimate a Mineral
Resource. It is uncertain if further exploration will result in the estimation of a Mineral
Resource.
Based on the above tabulation, the Kookynie Gold Project has a total “Exploration Target” of between 294,000
ounces and 967,000 ounces and includes historically stated mineral resource estimates and previously
excluded areas of underground development. Work to date by the Company in drilling, mapping and
sampling has supported historical work and provided confidence to including it in the “Exploration Target”.
At Cosmopolitan, the mineralisation is extrapolated some 200 metres to 300 metres down dip from historic
workings to estimate the Exploration Target. The update is based on the Company’s review of historical
reports, sampling and the results of the company’s drilling and exploration work. Historical reports from 1905,
detailed channel sampling conducted during the development of the gold mine, coupled with a mineralisation
estimate (actual date of publishing was 1989) illustrated that in both sets of information detailed remnant
mineralisation was evident.
The Company has drill tested part of the Cosmopolitan Gold Mine that was excluded in this May 2019
estimated Exploration Target. A drill hole result from within the Cosmopolitan Gold Mine returned 2 metres
@ 22.1 g/t Au from 76 metres (please refer to ASX Announcement dated 31 July 2019 titled “Metalicity
Confirms Mineralisation”) coupled with other significant intercepts in the general area (detailed in that same
announcement dated 31 July 2019), has instigated a review of the “Exploration Target” in this area.
At Diamantina and Cumberland, mineralisation is extrapolated 300 metres to 500 metres down dip and 700
metres along strike. The maximum grade is assumed to be the historically mined grade of Cosmopolitan as
the Diamantina and Cumberland are strike continuations of that mineralisation. The revision of the
“Exploration Target” within the Diamantina and Cumberland Prospects is due to the extrapolation and
confirmation of information previously excluded from the original May 2019 estimate.
At Champion, McTavish and Leipold, the mineralisation is extrapolated between 150 metres to 200 metres
down dip and along strike. The upper grade is assumed to be between 1.5 g/t Au and 6 g/t Au based on
averages of significant drill hole intersections (both historic and recent) within the structures hosting
mineralisation.
4
Directors’ Report
During the financial year, Metalicity has completed several rounds of exploration drilling at Kookynie to test
plunge extensions at the historic mining centres, with a series of highly prospective results confirming
significant mineralisation potential (please refer to ASX Announcements listed after Table 2).
Results returned during the year are tabled over page which summarises the significant intercepts returned
from recent drilling programmes.
Figure 1 – Kookynie Prospect Locality Map with recent drill holes and mineralised trends.
5
Directors’ Report
Pros pect
Pros pect
Pros pect
Pros pect
Pros pect
Pros pect
Hole ID
Teneme nt Hol e Type
Ea s ti ng
Northing
RL
EOH
Dip
Azi
From (m) To (m)
MGA 94 Zone 51 South
LPRC0001
RC
350,744
6,752,130
420
48
-60
250
i ncl udi ng
i ncl udi ng
i ncl udi ng
-60
250
LPRC0002
RC
350,760
6,752,040
431
42
i ncl udi ng
LPRC0003
LPRC0004
LPRC0005
LPRC0006
LPRC0007
LPRC0008
LPRC0009
LPRC0010
LPRC0011
LPRC0012
LPRC0013
LPRC0015
RC
RC
350,766
6,752,030
431
42
350,785
6,752,027
431
350,713
6,752,113
430
350,732
6,752,121
430
350,720
6,752,092
350,739
6,752,099
350,728
6,752,074
350,746
6,752,081
430
430
430
430
350,765
6,752,088
430
60
30
36
30
36
30
36
54
-60
-60
250
250
i ncl udi ng
-60
250
i ncl udi ng
-60
250
-60
250
-60
-60
-60
-60
250
250
250
250
-60
250
RC
350,784
6,752,096
430
350,751
6,752,128
430
350,757
6,752,107
430
78
-60
250
Incl udi ng
54
60
-60
250
-60
250
Incl udi ng
Lei pol d
Lei pol d
Lei pol d
Lei pol d
Lei pol d
Lei pol d
Lei pol d
LPRC0016
M40/22
350,776
6,752,114
430
84
-60
250
LPRC0014
LPRC0017
LPRC0018
LPRC0019
LPRC0020
LPRC0021
LPRC0022
LPRC0023
LPRC0024
LPRC0025
LPRC0026
LPRC0027
LPRC0028
LPRC0029
LPRC0030
LPRC0031
LPRC0032
LPRC0033
LPRC0034
LPRC0035
LPRC0036
LPRC0037
LPRC0038
RC
RC
RC
RC
RC
RC
RC
RC
RC
RC
RC
RC
RC
RC
RC
RC
RC
RC
RC
RC
RC
RC
RC
350,769
6,752,135
430
350,736
6,752,057
350,755
6,752,064
350,774
6,752,071
350,792
6,752,079
350,745
6,752,037
350,764
6,752,044
430
430
430
430
430
430
75
30
42
54
72
30
42
-60
-60
-60
-60
-60
-60
-60
250
250
250
250
250
250
250
350782.5 6752051.2
430
60
-60
250
350801.2 6752058.5
430
350,753
6,752,019
430
350,772
6,752,026
350,759
6,751,999
350,778
6,752,006
350,763
6,751,977
350,781
6,751,984
350,775
6,751,941
350,794
6,751,948
350,790
6,752,033
430
430
430
430
430
430
430
430
350,809
6,752,041
430
350,796
6,752,014
430
350,815
6,752,021
430
350,800
6,751,991
430
350,819
6,751,999
430
78
30
40
36
42
30
40
30
48
60
78
60
78
60
78
-60
250
-60
-60
-60
-60
-60
-60
-60
-60
-60
-60
-60
250
250
250
250
250
250
250
250
250
250
250
-60
250
-60
-60
250
250
Continued over page.
34
34
39
40
18
19
26
24
26
38
38
9
18
26
15
21
18
32
41
31
42
42
33
30
35
40
46
49
52
54
23
39
57
26
37
41
53
58
24
15
31
25
26
44
59
69
43
60
43
37
43
41
22
21
29
30
28
46
41
12
21
27
19
25
22
33
43
32
46
45
37
31
44
42
47
50
64
57
27
42
60
30
39
42
54
64
32
19
34
31
36
47
67
70
45
65
Down
Hol e
Wi dth (m)
9
3
3
1
4
2
3
6
2
8
3
3
3
1
4
4
4
1
2
1
4
3
4
1
9
2
1
1
12
3
4
3
3
4
2
1
1
6
8
4
3
6
Gra de (Au
g/t)
Comments
7.31
7.91
10.4
31.2
7.1
10.8
3.4
9.4
19
3.2
6.3
6.81
9.92
2.7
3.71
4.12
7.08
1.98
8.57
1.26
16.3
20.7
9m @ 7.31 g/t Au from 34m
i nc. 3m @ 7.91 g/t Au from 34m
i nc. 3m @ 10.4 g/t Au from 39m
i nc. 1m @ 31.2 g/t Au from 40m
4m @ 7.1 g/t Au from 18m
i nc. 2m @ 10.8 g/t Au from 19m
3m @ 3.4 g/t Au from 26m
6m @ 9.4 g/t Au from 24m
i nc. 2m @ 19 g/t Au from 26m
8m @ 3.2 g/t Au from 38m
i nc. 3m @ 6.3 g/t Au from 38m
3m @ 6.81g/t Au from 9 m
3m @ 9.92g/t Au from 18 m
1m @ 2.7g/t Au from 26 m
4m @ 3.71g/t Au from 15 m
4m @ 4.12g/t Au from 21 m
No i nterce pt >1g/t Au
4m @ 7.08g/t Au from 18 m
1m @ 1.98g/t Au from 32 m
2m @ 8.57g/t Au from 41 m
1m @ 1.26g/t Au from 31 m
4m @ 16.3g/t Au from 42 m
i nc. 3m @ 20.7g/t Au from 42 m
13.28
4m @ 13.28g/t Au from 33 m
2.69
5.7
17.9
1.26
4.48
2.34
5.1
3.69
2.21
-
2.7
4.63
1.55
2.39
2.87
2.92
1.2
4.59
1.77
1m @ 2.69g/t Au from 30 m
9m @ 5.7g/t Au from 35 m
i nc. 2m @ 17.9g/t Au from 40 m
1m @ 1.26g/t Au from 46 m
1m @ 4.48g/t Au from 49 m
12m @ 2.34g/t Au from 52 m
i nc. 3m @ 5.1g/t Au from 54 m
No i nterce pt >1g/t Au
No i nterce pt >1g/t Au
4 m @ 3.69 g/t Au from 23m
3 m @ 2.21 g/t Au from 39m
Void - Hi s tori cal Workings Inters e cted
No i nterce pt >1g/t Au
4 m @ 2.7 g/t Au from 26m
2 m @ 4.63 g/t Au from 37m
1 m @ 1.55 g/t Au from 41m
1 m @ 2.39 g/t Au from 53m
6 m @ 2.87 g/t Au from 58m
No i nterce pt >1g/t Au
8 m @ 2.92 g/t Au from 24m
4 m @ 1.2 g/t Au from 15m
3 m @ 4.59 g/t Au from 31m
No i nterce pt >1g/t Au
6 m @ 1.77 g/t Au from 25m
No i nterce pt >1g/t Au
10
3.21
10 m @ 3.21 g/t Au from 26m
No i nterce pt >1g/t Au
No i nterce pt >1g/t Au
3
8
1
2
5
2.46
4.05
3.07
8.52
2.56
3 m @ 2.46 g/t Au from 44 m
8 m @ 4.05 g/t Au from 59 m
1 me tre @ 3.07 g/t Au from 69 m
2 m @ 8.52 g/t Au from 43 m
5 m @ 2.56 g/t Au from 60 m
6
Directors’ Report
MGA 94 Zone 51 South
Pros pect
Pros pect
Pros pect
Pros pect
Pros pect
Hol e ID
Tenement Hol e Type
Ea sting Northing
RL
EOH
Di p
Azi
From (m) To (m)
Down
Hol e
Wi dth (m)
Gra de (Au
g/t)
Comments
McTRC0001
McTRC0002
McTRC0003
M40/77
McTRC0004
McTRC0005
McTRC006
McTRC007
McTRC008
McTRC009
McTRC010
McTa vi sh
McTRC011
M40/77
McTRC012
McTRC013
McTRC014
McTRC015
CPRC0001
CPRC0002
CPRC0003
CPRC0004
CPRC0005
M40/27
Champion
Champion
Champion
Champion
Champion
Champion
Champion
DCC Trend
DCC Trend
DCC Trend
DCC Trend
DCC Trend
DCC Trend
DCC Trend
350,647
6,754,118
423
112
350,647
6,754,098
350,576
6,754,153
350,596
6,754,153
424
423
423
350,618
6,754,083
424
350,599
6,754,095
423
350,595
6,754,080
423
350,635
6,754,080
423
350,655
6,754,080
423
350,590
6,754,120
423
350,610
6,754,120
423
350,630
6,754,125
423
350,575
6,754,050
423
350,595
6,754,050
423
350,615
6,754,050
423
84
30
48
66
42
48
72
84
36
54
66
36
42
54
352,224
6,757,503
352,265
6,757,582
417
416
352,158
6,757,586
417
112
138
48
352,149
6,757,566
417
30
-60
270
i ncludi ng
-60
-60
-60
-60
270
270
270
270
i ncludi ng
270
270
270
270
270
270
270
270
270
270
-60
-60
-60
-60
-60
-60
-60
-60
-60
-60
-60
-60
-60
-60
270
250
270
270
i ncludi ng
Includi ng
352,167
6,757,631
417
42
-60
270
RC
RC
RC
RC
RC
RC
RC
RC
RC
RC
RC
RC
RC
RC
RC
RC
RC
RC
33
67
67
73
14
48
51
32
23
79
20
36
54
20
39
39
71
68
76
15
35
53
52
34
26
82
25
40
58
21
41
40
4
1
3
1
2
5
1
2
3
3
5
4
4
1
2
1
6.4
4m @ 6.4 g/t Au from 67m
15.47
i nc. 1m @ 15.47 g/t Au from 67m
1.41
3m @ 1.41 g/t Au from 73m
1.9
2.2
1m @ 1.9 g/t Au from 14m
2m @ 2.2 g/t Au from 33m
17.9
5m @ 17.9 g/t Au from 48m
80.17
3.76
6.33
2.06
4.17
5.01
4.64
-
14.11
19.42
i nc. 1m @ 80.17 g/t Au from 51m
2 m @ 3.76 g/t Au from 32 m
3 m @ 6.33 g/t Au from 23 m
No intercept >1g/t Au
3 m @ 2.06 g/t Au from 79 m
5 m @ 4.17 g/t Au from 20 m
4 m @ 5.01 g/t Au from 36 m
4 m @ 4.64 g/t Au from 54 m
No intercept >1g/t Au
Voi d - Hi s tori ca l Workings Intersected
2 m @ 14.11 g/t Au from 39 m
i nc. 1 metre @ 19.42 g/t Au from 39 m
Stope fi l l intersected - s tructure pres ent but mi ned out.
127
128
31
28
28
16
39
33
30
29
17
40
167
167.72
1
2
2
1
1
1
0.72
0.21
1.15
2
1.35
1.8
25.2
42.04
1.3
2.1
3.1
8.8
1.5
1.4
1m @ 1.35 g/t Au from 127m
2m @ 1.8 g/t Au from 31m
2m @ 25.2 g/t Au from 28m to EOH
i nc. 1m @ 42.04 g/t Au from 28m
1m @ 1.3 g/t Au from 16m
1m @ 2.1 g/t Au from 39m
0.72m @ 3.1 g/t Au from 167m
0.21m @ 8.8 g/t Au from 173.07m
1.15m @ 1.5 g/t Au from 174.85m
2m @ 1.4 g/t Au from 72m
Structure dil uted by Proterozoi c Dol eri te Dyke
CDRCDD0001 M40/61
RC/DD Ta i l
354,377
6,753,209
427
186.33
-60
270
173.07
173.28
CLRC0001
M40/61
CDDD0001
E40/332
RC
DD
354,153
6,754,058
354728
6753398
429
432
136
529.5
-60
-60
270
270
174.85
72
176
74
RC
-60
148
430
354284
M40/61
6753513
CDRC0001
270
Table 2 – Significant Drill Hole Intercepts*
*Please refer to announcements: ASX Announcement “Metalicity Confirms Mineralisation” dated 31 July 2019, ASX Announcement
“Metalicity Confirms Additional Gold Mineralisation at Kookynie” dated 2 October 2019, ASX Announcement “Metalicity Reports Drill
Hole Intercepts Up To 80 g/t Au & Additional Tenement Acquisition for Kookynie” dated 21 January 2020, ASX Announcement “Metalicity
Continues to Deliver Spectacular Drill Hole Results for the Kookynie Gold Project” dated 25 June 2020, ASX Announcement “Metalicity
Continues to Deliver Excellent Drill Hole Results for the Kookynie Gold Project” dated 2 July 2020, & ASX Announcement “Metalicity
Delivers More Outstanding Drill Hole Results for the Kookynie Gold Project. Phase Two Drilling to Commence Imminently” dated 10 July
2020.
2m @ 22.1 g/t Au from 76m
22.1
76
78
2
These programmes have tested and confirmed extensive mineralisation at Diamantina, Cosmopolitan and
Cumberland (collectively named the DCC Trend), as well as McTavish, Leipold and Champion. Please refer
to Figure 1 for Prospect and tenure locations.
The Leipold Prospect
The Company is observing consistent widths and relatively consistent grades at the Leipold Prospect in
relation to the structural framework that hosts the mineralisation. The Leipold Prospect is host to a JORC
2004 compliant mineral resource estimate. To date, Metalicity has 38 completed drill holes with all assays
returned, 22 of those holes are significantly higher than the resource estimate grade defined in 2011. Results
from this infill and step out drilling plus the results from LPRC0032, which define the strike extent, are being
used by the Company to address aspects required under JORC 2012 compliancy within previously drilled
areas. The objective is to completely redefine the overall size of this Prospect. Please refer to the figure
below:
7
Directors’ Report
Figure Two: Leipold Prospect Long Section Plane of Vein*
*Please refer to ASX Announcement “Metalicity Continues to Deliver Spectacular Drill Hole Results for the Kookynie Gold Project”
dated 25 June 2020, ASX Announcement “Metalicity Continues to Deliver Excellent Drill Hole Results for the Kookynie Gold Project”
dated 2 July 2020 & ASX Announcement titled “Metalicity Reports Drill Hole Intercepts Up To 80 g/t Au, Additional Tenement
Acquisition for Kookynie” dated 21 January 2020 & ASX Announcement titled “Metalicity Continues to Deliver Spectacular Drill Hole
Results for the Kookynie Gold Project” dated 25 August 2020.
The McTavish Prospect
Figure Three – McTavish Plane of Vein Section with recent drilling.
8
Directors’ Report
Two drilling programmes have been completed at the McTavish Prospect. The premise again was to confirm
and step out from known mineralisation to evaluate and ultimately update the McTavish JORC 2004 compliant
mineral resource estimate.
Similar issues around downhole surveys and the extent of the underground workings are required for the
Company to be able to complete a JORC 2012 compliant Mineral Resource Estimate. Through our
methodical exploration and development where we are addressing these aspects and intend to aggressively
expand our known mineralisation strike of McTavish from approximately 200 metres of strike, to over 400
metres with our Phase Two Drilling Programme.
McTavish has also returned high grade intercepts, such as 2 metres @ 14.11 g/t Au from 39 metres, including
1 metre @ 19.42 g/t Au from 39 metres. This drill hole represents a 20-metre step out south from McTRC0005
which returned 5 metres @ 17.9 g/t Au from 48 metres including 1 metre @ 80.17 g/t Au from 51 metres.
Please refer to Figure 3 above.
As at Leipold, at McTavish, the Company is observing widths, and most importantly grades well above the
JORC 2004 Mineral Resource Estimate. This bodes well for when a Mineral Resource Estimate is conducted
with much more geological and grade information to be inputted, for a potential, and significantly increased
Mineral Resource inventory. Therefore, as with Leipold, we are expanding our aggressive Phase Two Drilling
Programme to potentially delineate high grade mineralisation over a 400-500 metre strike length at McTavish.
Cosmopolitan Historical Underground Sampling
Historic channel sampling results at Cosmopolitan have indicated extraordinarily high-grade mineralisation in
areas of remnant mineralisation that still may exist in developed areas of the mine (please refer to ASX
Announcement dated 9 June 2020 titled “Extremely High-Grade Gold From Historical Underground Sampling
At The Cosmopolitan Gold Mine”).
Of the 2,438 sample points presented, 110 returned assays above 100 g/t Au, 444 returned assays above
50 g/t Au and 1,046 returned assays above 20 g/t Au. A short list of the best samples collated are presented
below, please refer to Figure 4:
3.2m @ 428.6 g/t Au
2.2m @ 433.2 g/t Au
2.0m @ 330.6 g/t Au
2.2m @ 220.4 g/t Au
2.0m @ 220.4 g/t Au
2.1m @ 217.4 g/t Au
2.1m @ 214.3 g/t Au
The information presented is open to the public via the DMIRS WAMEX System, and we are using this
information, along with the concurrent drone magnetic survey (please refer to ASX Announcement titled
“Drone Magnetic Survey To Commence at the Kookynie Gold Project” dated 2 June 2020) to assist the
Company in our efficient exploration efforts over the Kookynie Gold Project. This data further highlights and
illustrates that the Cosmopolitan Gold Mine was one of the largest, very high-grade and prolific gold mines of
its day.
The initial data suggests a significant opportunity with the high-grade remnant mineralisation may still exist
within developed areas, along with clear down dip potential to the high-grade mineralisation. Metalicity also
announced on 2 June 2020 that it had identified 2kms of strike extension to the structures that host
Cosmopolitan, which saw a magnetic survey completed to refine targets for drilling.
9
Directors’ Report
Figure Four – Cosmopolitan Gold Mine Long Section with Underground Workings with Channel Samples illustrated
as gram metres*.
*Please refer to ASX Announcement dated 9 June 2020 titled “Extremely High-Grade Gold From Historical Underground Sampling At
The Cosmopolitan Gold Mine”.
10
The Champion Prospect
Directors’ Report
Figure Five – Champion Plane of Vein Section with recent drilling.
The Champion Prospect is not only characterised by significant drill hole intercepts, but also historical
production from a very shallow (<8 metre depth) open pit. Whilst the grade control data from the open pit
operation is not available, there is a gap in the historical exploration drilling and the base of this pit that spans
approximately 25 metres. This area represents an opportunity to infill and define the mineralisation from the
top of historical drilling to the base of the pit. The Company has completed four Reverse Circulation (RC) drill
holes at the Champion Prospect for a total of 174 metres to test this section of mineralisation and to confirm
its continuance to the base of the pit. We are pleased to report that each of the drill holes intersected the
mineralised structure, demonstrating the up dip and strike continuation of mineralisation beyond the
previously defined limits of drilling.
Below is the full list of the December 2019 drilling programme results for Champion:
CPRC0003 – 2 metres @ 1.8 g/t Au from 31 metres,
CPRC0004 – 2 metres @ 25.2 g/t Au from 28 metres to EOH inc. 1 metre @ 42.04 g/t Au from 28
metres,
CPRC0005 – 1 metre @ 1.3 g/t Au from 16 metres & 1 metre @ 2.1 g/t Au from 39 metres, &
CPRC0006 – results pending.
The return of these very high tenor grades indicates the prospectivity across the Kookynie Gold Project.
11
Directors’ Report
The Yundamindra Gold Project
The Company has also arranged a further farm-in agreement at Yundamindra for exploration licenses
E39/1773 and E39/1774.
The tenements are owned by a private entity and are immediately south of the Yundamindra Gold Project
(See Figure 6). The tenements potentially host strike extents of the mineralisation observed at the Queen of
May and Bound to Rise prospects.
Whilst all Yundamindra tenure is currently under plaint, Metalicity is comfortable that the current owners can
defend this claim and they are tasked with doing so under the farm-in agreement.
Under the farm-in agreement E39/1773 and E39/1774 Metalicity will spend $200,000 over 2 years to earn
100% of the tenure. Upon reaching this milestone, the owners will revert to a royalty of 1% NSR on the first
50,000 ounces of production that may potentially be sourced from within this area.
*Please refer to ASX Announcement “September 2019 Quarterly Activities Report” dated 30 October 2019.
Figure Six – Yundamindra Tenement Map*
12
Directors’ Report
Admiral Bay
The Company currently holds an 80.3% interest in Kimberley Mining Ltd.(KML), that in turn holds 100% of
the Admiral Bay Asset. While the asset itself is on care and maintenance, the Company is in discussion with
a number of parties to affect a deal that will monetise its interest in KML.
As the Company is now looking to concentrate its efforts on the Kookynie and Yundamindra Gold Projects it
can confirm that the Admiral Bay Project is no longer core business.
Metalicity continues to provide limited assistance on commercial terms to KML through this period with a view
to maximising benefits to all shareholders.
Regional Projects
During the reporting year, Metalicity relinquished all regional tenure outside of the Admiral Bay, Kookynie and
Yundamindra Gold Projects. The strategy of the Company is to move forward with our farm in partner, Nex
Metals Explorations in exploring and developing the Kookynie and Yundamindra Gold Projects.
Disclaimer and Forward-Looking Statements
This report is not a prospectus nor an offer of securities for subscription or sale in any jurisdiction nor a
securities recommendation. The information in this report is an overview and does not contain all information
necessary for investment decisions. In making investment decisions, investors should rely on their own
examination of Metalicity Limited and consult with their own legal, tax, business and/or financial advisers in
connection with any acquisition of securities. The information contained in this report has been prepared in
good faith by Metalicity Limited. However, no representation or warranty, express or implied, is made as to
the completeness or adequacy of any statements, estimates, opinions or other information contained in this
report. To the maximum extent permitted by law, Metalicity Limited, its directors, officers, employees and
agents disclaim liability for any loss or damage which may be suffered by any person through the use of, or
reliance on, anything contained in or omitted from this report. Certain information in this report refers to the
intentions of Metalicity Limited, but these are not intended to be forecasts, forward looking statements, or
statements about future matters for the purposes of the Corporations Act (Cth, Australia) or any other
applicable law. The occurrence of events in the future are subject to risks, uncertainties and other factors
that may cause Metalicity Limited’s actual results, performance or achievements to differ from those referred
to in this report to occur as contemplated. The report contains only a synopsis of more detailed information
to be published in relation to the matters described in this document and accordingly no reliance may be
placed for any purpose whatsoever on the sufficiency or completeness of such information and to do so could
potentially expose you to a significant risk of losing all of the property invested by you or incurring by you of
additional liability. Recipients of this report should conduct their own investigation, evaluation and analysis of
the business, data and property described in this document. In particular, any estimates or projections or
opinions contained herein necessarily involve significant elements of subjective judgment, analysis and
assumptions and you should satisfy yourself in relation to such matters. Furthermore, this report may contain
certain “forward-looking statements” which may not have been based solely on historical facts, but rather
may be based on the Company’s current expectations about future events and results. Where the Company
expresses or implies an expectation or belief as to future events or results, such expectation or belief is
expressed in good faith and believed to have reasonable basis. However, forward-looking statements:
(a) are necessarily based upon a number of estimates and assumptions that, while considered reasonable
by the Company, are inherently subject to significant technical, business, economic, competitive, political and
social uncertainties and contingencies;
(b) involve known and unknown risks and uncertainties that could cause actual events or results to differ
materially from estimated or anticipated events or results reflected in such forward-looking statements. Such
risks include, without limitation, resource risk, metals price volatility, currency fluctuations, increased
production costs and variances in ore grade or recovery rates from those assumed in mining plans, as well
as political and operational risks in the countries and states in which the Company operates or supplies or
sells product to, and governmental regulation and judicial outcomes; and
(c) may include, among other things, statements regarding estimates and assumptions in respect of prices,
costs, results and capital expenditure, and are or may be based on assumptions and estimates related to
future technical, economic, market, political, social and other conditions.
13
Directors’ Report
The words “believe”, “expect”, “anticipate”, “indicate”, “contemplate”, “target”, “plan”, “intends”, “continue”,
“budget”, “estimate”, “may”, “will”, “schedule” and similar expressions identify forward-looking statements.
All forward-looking statements contained in this presentation are qualified by the foregoing cautionary
statements. Recipients are cautioned that forward-looking statements are not guarantees of future
performance and accordingly recipients are cautioned not to put undue reliance on forward-looking
statements due to the inherent uncertainty therein.
The Company disclaims any intent or obligation to publicly update any forward-looking statements, whether
because of new information, future events or results or otherwise.
Competent Person Statements
Information in this report that relates to Exploration results and targets is based on, and fairly reflects,
information compiled by Mr. Jason Livingstone, a Competent Person who is a Member of the Australian
Institute of Geoscientists. Mr. Livingstone is an employee of Metalicity Limited. Mr. Livingstone has sufficient
experience that is relevant to the style of mineralisation and type of deposit under consideration and to the
activity which he is undertaking to qualify as a Competent Person as defined by the 2012 Edition of the
Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr.
Livingstone consents to the inclusion of the data in the form and context in which it appears. In addition,
please refer to the referenced ASX Announcements for the Competent Persons Statements applicable.
Metalicity confirms that the Company is not aware of any new information or data that materially affects the
information included in the report and, in the case of “exploration results” that all material assumptions and
technical parameters underpinning the “exploration results” in the relevant announcements referenced apply
and have not materially changed.
14
Directors’ Report
Tenement Schedule
The Following table shows all tenure subject to the farm-in agreement with Nex Metals (ASX: NEX) for the
Kookynie and Yundamindra projects as announced on the 6th May 2019:
Project
TEN ID
Holder
Granted
Expires
Area (ha)
Shares Held
K
o
o
k
y
n
e
i
Y
u
n
d
a
m
n
d
r
a
i
G40/3
Nex Metals Explorations Limited
19-02-1986
24-02-2029
L40/9
Nex Metals Explorations Limited
19-05-1995
18-05-2025
E40/332
Nex Metals Explorations Limited
15-08-2014
14-08-2024
M40/22
Nex Metals Explorations Limited
29-08-1986
28-08-2028
M40/27
Nex Metals Explorations Limited
25-02-1987
24-02-2029
M40/61
Nex Metals Explorations Limited
13-07-1989
12-07-2031
M40/77
Nex Metals Explorations Limited
13-10-1988
12-10-2030
P40/1331
KYM Mining Limited
9-04-2014
8-04-2022
7.2
1.0
600.0
121.7
85.5
832.7
119.2
161.2
E40/289
Paris Enterprises Pty Ltd
1-07-2011
30-06-2021
1,222.7
P40/1499 Nex Metals Explorations Limited
P40/1500 Nex Metals Explorations Limited
P40/1501 Nex Metals Explorations Limited
P40/1510
P40/1511
P40/1512
E40/390
E40/387
E40/395
Metalicity Limited
Metalicity Limited
Metalicity Limited
KYM Mining Limited
Metalicity Limited
KYM Mining Limited
Pending
Pending
Pending
Pending
Pending
Pending
Pending
Pending
Pending
L39/34
Nex Metals Explorations Limited
15-12-1988
14-12-2023
L39/52
Nex Metals Explorations Limited
19-12-1993
18-12-2023
L39/258
Nex Metals Explorations Limited
16-04-2018
15-04-2039
M39/84
Nex Metals Explorations Limited
29-10-1987
28-10-2029
M39/274 Nex Metals Explorations Limited
21-05-1992
20-05-2034
M39/406
Nex Metals Explorations Limited
21-11-2007
20-11-2028
M39/407 Nex Metals Explorations Limited
13-11-2007
12-11-2028
M39/408 Nex Metals Explorations Limited
13-11-2007
12-11-2028
M39/409 Nex Metals Explorations Limited
13-11-2007
12-11-2028
M39/410 Nex Metals Explorations Limited
6-03-2008
5-03-2029
M39/839 Nex Metals Explorations Limited
2-07-2008
1-07-2029
M39/840
Nex Metals Explorations Limited
2-07-2008
1-07-2029
P39/6126 Nex Metals Explorations Limited
P39/6127 Nex Metals Explorations Limited
Pending
Pending
8.3
5.9
21.1
185.0
176.7
118.6
3,300.0
299.0
4,203.0
1.0
1.0
3.2
378.0
230.0
124.0
896.0
785.0
966.0
978.0
7.3
9.7
10.4
5.6
E39/1773
Paddick Investments Pty Ltd
5-06-2014
4-06-2024
903.0
E39/1774
Paddick Investments Pty Ltd
5-06-2014
4-06-2024
2,517.0
Total Farm In Area (ha)
19,283.8
100/100
100/100
100/100
100/100
100/100
100/100
90,405/90,405
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
96/96
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
100/100
15
Directors’ Report
The following table shows the tenements the Group has an interest in at 30 June 2020:
Project
TEN ID
Admiral Bay
ML04/244
Admiral Bay
ML04/249
Admiral Bay
EL04/1610
Holder
Kimberley Mining Australia Pty Ltd
100%
Kimberley Mining Australia Pty Ltd
100%
Kimberley Mining Australia Pty Ltd
100%
Granted
Expires
21/03/1991
20/03/2033
21/03/1991
20/03/2033
04/09/2007
03/09/2021
Admiral Bay
E04/2621
Metalicity Limited 100%
07/10/2019
06/10/2024
Kookynie
P40/1331
KYM Mining Pty Ltd 100%
09/04/2014
08/04/2022
Results
The loss after income tax for the year ended 30 June 2020 was $1,340,757 (30 June 2019: loss $4,410,376).
Significant changes in state of affairs
There were no significant changes in the state of affairs of the Group during the financial year.
Environmental regulations
The Group is aware of its environmental obligations with regards to its exploration activities and ensures that
it complies with all regulations when carrying out exploration work.
Dividends
No dividends have been paid or declared since the beginning of the financial year and none are
recommended.
Subsequent events
Other than the following, the directors are not aware of any significant events since the end of the reporting
period which significantly affect or could significantly affect the operations of the consolidated entity in future
financial years:
- On 16 July 2020, the Company announced the conversion of 13,802,941 options at various option
prices, raising $142,120.
- On 24 July 2020, the Company announced the conversion of 2,148,014 options at $0.004 and 15,508
options at $0.015, raising $8,825.
- On 10 August 2020, the Company announced the conversion of 877,445 options at $0.004 and
246,300 options at $0.015, raising $7,204.
- On 20 August 2020, the Company announced the conversion of 13,500,000 options at $0.004, raising
$54,000 and the vesting of 15 million performance rights.
- On 20 August 2020, the Company announced the shareholder approved conversion of outstanding
Director Fees into 23,882,240 fully paid ordinary shares.
- On 21 August 2020, the Company announced the issue of 177.5 million options, as approved by
shareholders at general meeting.
- On 28 August 2020, the Company announced the conversion of 2,538,168 options at $0.004 and
16,691 options at $0.015, raising $10,403.
- On 7 September 2020, Metalicity Limited announced the completion of a $5 million placement (before
costs) to existing and new sophisticated and professional investors with the issue of 208.3m shares
at $0.024 and 35,000,000 options to brokers at an exercise price of $0.03.
- On 9 September 2020, the Company announced the conversion of 49,386,253 options at $0.004 and
1,255,689 options at $0.015, raising $216,380 and the vesting of 1,000,000 performance rights.
- On 24 September 2020, the Company announced the appointment of Mr Nick Day as Company
Secretary following the resignation of Mr Neil Hackett.
Likely developments and expected results of Operations
The Group will continue to explore and assess its mineral projects.
16
Directors’ Report
Information on Directors
Jason Livingstone - Managing Director – appointed 1 July 2019
Experience and Expertise
Mr Livingstone is a geologist with 20 years’ experience across exploration through to production environments
on four continents. Mr Livingstone holds a Bachelor of Science (Geology) from the West Australian School
of Mines, a Masters of Business Administration from the Curtin Graduate School of Business, is a member
of the Australian Institute of Geoscientists, and has completed the Company Directors Course at the
Australian Institute of Company Directors.
Other Current Directorships
None
Former Directorships in the Last Three Years
None
Special Responsibilities
None
Interests in Shares and Options
23,574,348 ordinary shares, 10,000,000 performance rights and 4,000,000 unlisted options
Mathew Longworth - Non-executive Chairman – appointed 1 July 2019 (previously Chief Executive
Officer since 10 January 2019 and Non-Executive Board Member since 29
September 2014)
Experience and Expertise
Mr Longworth is a geologist with 30 years’ experience across exploration, project evaluation/development,
operations and corporate management. He previously held roles as Exploration Manager, COO and
CEO/Managing Director with Australian listed companies, and mining analyst with a boutique investment
fund. In his senior corporate roles, Mathew led multidisciplinary project evaluation and development teams.
Mr. Longworth is a member of the Australasian Institute of Mining and Metallurgy.
Other Current Directorships
Ardea Resources
Greenfields Exploration Limited ( a public unlisted company)
Kimberley Mining Limited (a public unlisted Canadian company)
Former Directorships in the Last Three Years
None
Special Responsibilities
Chair of the Audit Committee
Interests in Shares and Options
4,909,148 ordinary shares, 264,238 listed options and 4,231,709 unlisted options
17
Directors’ Report
Justin Barton –
Finance Director – appointed 1 January 2018
Experience and Expertise
Mr Barton is a Chartered Accountant with over 20 years’ experience in accounting, international finance, M&A
and the mining industry. He worked for over 13 years in the Big 4 Accounting firms in Australia and Europe
and advised many of the world’s largest mining, oil & gas companies and financial institutions, including Rio
Tinto, Chevron, Macquarie, Merrill Lynch, Morgan Stanley and Deutche Bank. Justin also worked for 4 years
at Paladin Energy Limited as Group Tax and Finance Manager. More recently, he has worked as the CFO
and has been a Board Member of a number of junior exploration companies.
Other Current Directorships
Kimberley Mining Limited (a public unlisted Canadian company)
Former Directorships in the Last Three Years
Great Western Exploration Limited (appointed 20 May 2020, resigned 4 June 2020)
Eneabba Gas Limited (appointed 1 March 2017, resigned 10 October 2017)
Interposed Holdings Limited (appointed 10 January 2017, resigned 11 December 2017)
Special Responsibilities
Finance Director, member of the Audit Committee and the Remuneration and Nomination Committee.
Interests in Shares and Options
15,439,284 ordinary shares and 5,625,000 performance rights
Andrew Daley -
Non-executive Director – appointed 1 July 2019 (previously Non-Executive
Chairman since 19 August 2013)
Experience and Expertise
Mr Daley is a Mining Engineer and Investment Banker. He has a Bachelor of Science (Honours), is a
Chartered Engineer (UK), a Fellow of the Australasian Institute of Mining and Metallurgy and Member
of IOM3 (UK). He has over 45 years’ experience in resources having worked with Anglo American Corp,
Rio Tinto, Conoco Minerals and Fluor Australia in mining operations, project evaluation and mining
development. Mr Daley then moved into resource project finance with National Australia Bank, Chase
Manhattan and from 1999 was a Director of the Mining Team at Barclays Capital in London.
Subsequently, Mr Daley was a Director of Investor Resources Finance Pty Limited, a company based
in Melbourne which provided financial advisory services to the resources industry globally.
Other Current Directorships
None
Former Directorships in the Last Three Years
None
Special Responsibilities
Chairman of the Audit and Risk Committee and the Remuneration and Nomination Committee.
Interests in Shares and Options
13,993,011 ordinary shares and 5,250,000 unlisted options.
18
Directors’ Report
Company Secretary
Nicholas Day –
Company Secretary – appointed 24 September 2020
Mr Day has over 20 years’ experience as a company director, CFO and company secretary for a broad range
of listed and private exploration, mining and technology companies. Previously he was CFO and company
secretary of Battery Minerals, Minbos Resources Limited, Dreadnought Resources Limited, RTG Mining,
finance director at Coventry Resources and company secretary to Paringa Resources Limited and Ebooks
Corporation.
Interests in Shares and Options
Nil interest.
Neil Hackett – Company Secretary – resigned 23 September 2020
Mr Hackett was appointed to the position of company secretary on 4 December 2014. Neil has over 20 years
of company secretarial, compliance and company directorship experience, including 10 years with the ASIC
and seven years as an ASX 200 listed company secretary. He is currently Chairman, Director and Company
Secretary of various ASX listed and private entities. Neil holds a Bachelor of Economics, is a Fellow of
FINSIA, and is a Graduate and Facilitator with the Australian Institute of Company Directors.
Interests in Shares and Options
1,062,000 ordinary shares and 400,000 performance rights.
Directors’ meetings
The number of meetings of the Company’s board held during the year ended 30 June 2020 that each director
was eligible to attend, and the number of meetings attended by each director were:
Director
Number of Meetings
Eligible to attend
Attended
Jason Livingstone
Andrew Daley
Justin Barton
Mathew Longworth
15
15
15
15
15
15
15
15
19
Directors’ Report
Remuneration Report (Audited)
The Remuneration Report is set out under the following main headings:
(1) Principles used to determine the nature and amount of remuneration;
(2) Details of remuneration;
(3) Service agreements;
(4) Share-based compensation; and
(5) Share and option holdings of Key Management Personnel (KMP)
The information provided in this Remuneration Report has been audited as required by Section 308(3C) of
the Corporations Act 2001.
1
Principles used to determine the nature and amount of remuneration
The objective of the Group’s executive reward framework is to ensure reward for performance is competitive
and appropriate for the results delivered. The framework aligns executive reward with achievement of
strategic objectives and the creation of value for shareholders, and conforms to market best practice for
delivery of reward. The board ensures that executive reward satisfies the following key criteria for good
reward governance practices:
(i) competitiveness and reasonableness;
(ii) acceptability to shareholders;
(iii) performance linkage / alignment of executive compensation;
(iv) transparency; and
(v) capital management.
The Group has structured an executive remuneration framework that is market competitive and
complimentary to the reward strategy of the organisation.
Alignment to shareholders’ interests:
focuses on sustained growth in shareholder wealth; and
(i)
(ii) attracts and retains high calibre executives.
Alignment to program participants’ interests:
(i)
rewards capability and experience; and
(ii) provides a clear structure for earning rewards.
20
Directors’ Report
Remuneration Report (audited) (continued)
2
Details of remuneration
Executive fees
The fees and payments to the executive reflect the demands which are made on, and the responsibilities of
the executive, and are in line with market. The executives’ remuneration is reviewed annually by the board
to ensure that the fees and payments remain appropriate and in line with the market.
The remuneration packages of the Executives are detailed below under “Service agreements”.
Non-executive directors
Fees to the non-executive directors are determined by the Remuneration Committee as appropriate having
regard to the market and the aggregate remuneration specified in the Company’s Constitution and determined
by the shareholders in general meeting. The fees are reviewed annually.
Retirement allowances and benefits
There are no retirement or termination allowances, or benefits paid to directors.
The amount of remuneration of the directors of the Company (as defined in AASB 124 Related Party
Disclosures) and other key management personnel is set out in the following table.
Short term benefits
Post
employment
benefits
Equity settled
share based
payments
2020
Salary &,
fees(a)
Annual
leave
Other
Super-
annuation
Options/
Performance
Rights
Total
Performance
related %
Executive director
Jason Livingstone
Justin Barton
Non-executive directors
Andrew Daley
Mathew Longworth (b)
Other executives
Neil Hackett (c)
Totals
210,046
182,652
10,212
9,004
-
-
45,662
75,312
-
-
-
22,500
52,000
565,672
-
19,216
-
22,500
19,954
17,348
4,338
-
-
41,640
40,971
21,510
281,183
230,514
-
-
50,000
97,812
2,458
64,939
54,458
713,967
14.6%
9.3%
0.0%
0.0%
4.5%
The fees paid to director related entities were for the provision of services of the particular director to the
Company are as follows:
(a) During the year, the Directors agreed to accrue a portion of salary to preserve cash in the company
during Covid-19 and obtained shareholder approval to convert this portion of salary to shares at the
general meeting on 20 August 2020. The shareholder approved conversion of accrued Director Fees
into 23,882,240 fully paid ordinary shares. The accrued salary converted to shares was $26,256 for
Jason Livingstone, $22,831 for Justin Barton, $9,687 for Mat Longworth and $5,708 for Andrew Daley.
(b) Mat Mining Pty Ltd, an entity associated with Mathew Longworth, was paid $75,312 (2019: $199,742)
for director’s fees and a further $22,500 for consultancy services.
(c) Corporate Starboard Pty Ltd, an entity associated with Neil Hackett, was paid $52,000 (2019: $54,400).
21
Remuneration Report (audited) (continued)
Directors’ Report
Short term benefits
Post
employment
benefits
Equity settled
share based
payments
2019
Salary,
fees &
leave
Annual
leave
Other
Super-
annuation
Options/
Performance
Rights
Total
Performance
related %
Executive director
Matthew Gauci(a)
Justin Barton
Non-executive directors
Andrew Daley(b)
Mathew Longworth(c)
Other executives
Jason Livingstone(d)
Leonardo Romero(e)
Neil Hackett(f)
Totals
162,003
182,656
83,750
55,833
67,732
19,433
54,400
625,807
-
6,556
140,000
-
21,771
17,352
-
5,894
323,774
212,458
-
-
-
143,909
5,269
-
-
11,825
-
-
-
283,909
-
-
6,435
1,846
-
47,404
-
-
83,750
199,742
10,795
-
-
16,689
90,231
21,279
54,400
985,634
0.0%
2.8%
0.0%
0.0%
12.0%
0.0%
0.0%
The fees paid to director related entities were for the provision of services of the particular director to the
Company are as follows:
(a) Matthew Gauci resigned on 9 January 2019 and was paid a termination payment of $137,500. An
associated entity of Mr Gauci, Macro Capital Partners, has a post termination consultancy agreement for
$500 a month for 18 months, of which $2,500 was paid during the year. This agreement was terminated
during the year ended 30 June 2020.
(b) Dalenier Enterprises Pty Ltd, an entity associated with Andrew Daley, was paid or is payable $83,750
(2018: $90,000) for director’s fees.
(c) Mat Mining Pty Ltd, an entity associated with Mathew Longworth, was paid $199,742 (2018: $67,500)
for director’s fees and consultancy services.
(d) Jason Livingstone was appointed as Exploration Manager on 18 February 2019 and Managing Director
on 1 July 2019.
(e) Leonardo Romero resigned on 31 August 2018.
(f) Corporate Starboard Pty Ltd, an entity associated with Neil Hackett, was paid or is payable $54,400
(2018: $70,815).
Short term incentives
Short term incentives (STI) are an ‘at risk’ component of senior employee’s remuneration packages and are
awarded based on annual review of past year’s performance against specific goals.
No STI’s were paid during the year ended 30 June 2020 or 30 June 2019.
Long term incentives
Long term incentives (LTI) are “at risk” benefits awarded to the Managing Director and potentially senior
executives for achieving certain specified goals related to the long-term growth and development of the
Group.
LTI’s were awarded to Jason Livingstone and Justin Barton during the year ended 30 June 2020 and 30 June
2019. During the year ended 30 June 2020, Jason Livingstone was awarded 10 million performance rights
vesting at 2.5cents and 10 million performance rights vesting at 5cents. Justin Barton was awarded 5 million
performance rights vesting at 2.5cents and 5.625 million performance rights vesting at 5cents.
22
Directors’ Report
Remuneration Report (audited) (continued)
Service agreements
3
Directors
There is an Executive Contract with Jason Livingstone, to perform the function of Managing Director from 1
July 2019 until termination in accordance with the contract. The details are:
1. Remuneration of $230,000 per annum (including superannuation and directors fees) subject to an
annual review;
2. The Company may pay a performance based bonus of up to 50% over and above the salary;
3. The Company reimburses costs and expenses reasonably incurred;
4. Either party can terminate the agreement on six months (6) months written notice.
There are letters of director appointment with each director which set out the annual fixed fee and terms and
conditions of the appointment including compliance with the Company’s Constitution and Corporate
Governance Policies; re-election, retirement and office vacancy; duties; remuneration; insurance and
indemnity; disclosure of interests; and confidentiality. They serve until they resign, are removed, cease to be
a director or prohibited from being a director under the provisions of the Corporations Law 2001, or are not
re-elected to office. They are remunerated on a monthly basis with no termination payments payable.
It is the Group’s policy that service contracts for non-executive directors are unlimited in term and capable of
termination by either party upon written notice.
Key Management Personnel
There is a Consultancy Agreement with 133 North Trust for Nick Day, to perform the function of Company
Secretary, commencing on 24 September 2020 until the termination of the contract. The details are:
1. Monthly retainer of $5,500 exclusive of GST per month. Additional time to be charged at $220/hr;
and
2. Either party can terminate the agreement by giving four weeks written notice
The Company had a Consultancy Agreement with Corporate Starboard Pty Ltd for Neil Hackett to perform
the function of Company Secretary, which commenced 1 December 2014 and ended on 24 September 2020.
The details were:
3. Monthly retainer of $4,000 exclusive of GST per month. Additional time to be charged at $175/hr;
and
4. Either party can terminate the agreement by giving two weeks written notice
In the case of wilful or fraudulent misconduct, the Group retains the right to terminate all service contracts
without notice.
Key management personnel are entitled to receive on termination of employment their statutory entitlements,
including any accrued annual and long service leave, together with any superannuation benefits. Each service
contract outlines the components of compensation paid to the key management personnel but does not
prescribe how compensation levels are modified year to year.
23
Directors’ Report
Remuneration Report (audited) (continued)
4
Share-based compensation
During the financial year, the following performance rights for Directors and key management personnel were
granted:
2020
Name
Share price at
grant date
No. granted
Grant date
Expiry Date
Jason Livingstone
Jason Livingstone
Justin Barton
Justin Barton
Neil Hackett
$0.025
$0.05
$0.025
$0.05
$0.025
10,000,000
10,000,000
5,000,000
5,625,000
1,000,000
25/11/2019
25/11/2019
25/11/2019
25/11/2019
25/11/2019
30/01/2023
30/01/2023
30/01/2023
30/01/2023
30/01/2023
Value of
Performance
Rights granted
at grant date
$24,583
$16,388
$12,291
$9,219
$2,458
No performance rights issued to directors or key management personnel vested during the year and no
options were exercised during the year. No performance rights or option issued to directors or key
management personnel were cancelled during the year. 25,500,000 Options issued to Matt Gauci were
cancelled during the year.
5
Share and option holdings of Key Management Personnel (KMP)
(i) Option and performance right holdings
The numbers of options over ordinary shares in the Company held during the financial year by each KMP,
including their personally related parties, are set out below:
2020
Options
Directors
Balance at
the start of
the year
Granted
during the
year (a)
Exercised
during the
year
Other changes
during the year
Balance at
the end of
the year
Vested and
exercisable
at the end
of the year
Vested but
not
exercisable
at end of
year
Jason Livingstone
4,000,000
1,016,667
Andrew Daley
12,750,000
1,716,420
Justin Barton
13,500,000
362,964
Mathew Longworth
10,200,000
295,971
Other executives
Neil Hackett
6,000,000
-
46,450,000
3,392,022
-
-
-
-
-
-
-
5,016,667
5,016,667
- 14,466,420 14,466,420
(13,500,000)(b)
362,964
362,964
- 10,495,971 10,495,971
(6,000,000)(b)
-
-
(19,500,000) 30,342,022 30,342,022
-
-
-
-
-
-
(a)Options acquired as part of shareholder entitlement issue and placement.
(b)Options expired on 31 December 2019 or were cancelled during the year.
24
Remuneration Report (audited) (continued)
Directors’ Report
2019
Options
Directors
Balance at
the start of
the year
Granted
during the
year
Exercised
during the
year
Other
changes
during the
year
Balance at the
end of the
year
Vested and
exercisable
at the end
of the year
Vested but
not
exercisable
at end of
year
Matthew Gauci
33,500,000
Andrew Daley
12,750,000
-
-
Justin Barton
6,000,000
7,500,000
Mathew Longworth
10,200,000
-
Other executives
Jason Livingstone
-
4,000,000
Leonardo Romero
6,000,000
Neil Hackett
6,000,000
-
-
(a)Balance at time of resignation
74,450,000 11,500,000
2020
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
33,500,000(a) 33,500,000
12,750,000 12,750,000
13,500,000
6,000,000
10,200,000 10,200,000
4,000,000
4,000,000
6,000,000(a)
6,000,000
6,000,000
6,000,000
85,950,000 78,450,000
-
-
-
-
-
-
-
-
Balance at
the start of
the year
Granted
during the
year
Exercised
during
the year
Other
changes
during the
year
Balance at
the end of
the
year/date of
resignation
Vested and
exercisable at
the end of the
year/date of
resignation
Vested but
not
exercisable
at end of
year
Performance Rights
Directors
Jason Livingstone
Justin Barton
Other executives
- 20,000,000
- 10,625,000
Neil Hackett
400,000
1,000,000
400,000 31,625,000
2019
-
-
-
-
- 20,000,000
10,000,000
10,625,000
5,000,000
1,400,000
1,000,000
- 32,025,000
16,000,000
-
-
-
-
Balance at
the start of
the year
Granted
during the
year
Exercised
during
the year
Other
changes
during the
year
Balance at
the end of the
year/date of
resignation
Vested and
exercisable
at the end
of the
year/date of
resignation
Vested but
not
exercisable
at end of
year
Performance Rights
Other Executives
Neil Hackett
400,000
Leonardo Romero
1,506,846
(a)Balance at time of resignation
1,906,846
-
-
-
-
-
-
-
-
400,000
1,506,846(a)
1,906,846
-
-
-
-
-
-
25
Remuneration Report (audited) (continued)
Directors’ Report
5
Share and option holdings of Key Management Personnel (KMP) (continued)
(ii) Share holdings
The numbers of shares in the Company held during the financial year by each director, including their
personally related parties, are set out below:
2020
Directors
Jason Livingstone
Andrew Daley
Justin Barton
Mathew Longworth
Other executives
Neil Hackett
2019
Directors
Matthew Gauci
Andrew Daley
Justin Barton
Mathew Longworth
Other executives
Jason Livingstone
Leonardo Romero
Neil Hackett
(a)Balance at time of resignation
Balance at the
start of the year
Received during the
year on the
exercise of options
Other changes during
the year
Balance at the
end of the year
-
3,678,036
777,778
634,167
340,801
5,430,782
-
-
-
-
-
-
2,833,333
3,984,545
842,594
687,016
2,833,333
7,662,581
1,620,372
1,321,183
-
340,801
8,347,488
13,778,270
Balance at the
start of the year
Received during the
year on the
exercise of options
Other changes during
the year
Balance at the
end of the year
11,739,033
2,588,682
277,778
634,167
-
-
340,801
15,580,461
-
-
-
-
-
-
-
-
(397,000)
1,089,354
500,000
-
-
-
-
11,342,033(a)
3,678,036
777,778
634,167
-
-
340,801
1,192,354
16,772,815
(End of Remuneration Report)
26
Directors’ Report
Additional Information
(a)
Shares under option
At the date of this report, the Company had 439,152,036 options and 16,025,000 performance rights over
ordinary shares under issue. These options are exercisable as follows:
Details
Management Incentive Options
Other Options
Details
Performance Rights
No of
Options
3,150,000
4,550,000
4,550,000
2,500,000
2,500,000
2,500,000
2,000,000
2,000,000
25,709,467
10,785,715
3,000,000
3,000,000
6,768,765
7,945,620
25,000,000
333,192,469
439,152,036
No of
Options
400,000
15,625,000
16,025,000
Grant Date
Date of Expiry Conversion Price $
27/11/2015
27/11/2015
27/11/2015
27/07/2018
27/07/2018
27/07/2018
10/04/2019
10/04/2019
21/02/2018
10/06/2019
15/03/2018
15/03/2018
04/10/2019
18/10/2019
13/08/2020
22/05/2020
10/12/2020
10/12/2020
10/12/2020
26/08/2021
26/08/2021
26/08/2021
14/01/2022
14/01/2022
14/02/2023
31/05/2022
12/03/2021
12/03/2021
04/10/2020
18/10/2020
14/08/2022
22/05/2022
0.03
0.04
0.05
0.06
0.08
0.10
0.025
0.035
0.08
0.02
0.06
0.08
0.015
0.015
0.003
0.004
Grant Date
Date of Expiry Hurdle Price $
15/03/2018
25/11/2019
15/03/2021
30/01/2023
0.06
0.05
Refer to note 15 for details of options cancelled and exercised during the year.
At the date of this report, Kimberly Mining Limited, a Canadian subsidiary of the Company, had the following
warrants on issue:
Details
Founder Warrants
Founder Warrants – Tranche 2
No of
Options
5,289,500
3,171,500
8,461,000
Grant Date
Date of Expiry Conversion Price $
29/08/2018
28/09/2018
29/08/2023
28/09/2023
0.4
0.4
(b)
Insurance of officers
During the financial year, the Group paid a premium in respect of a contract insuring the directors of the
Company, the Company Secretary, and any executive officers of the Company and of any related body
corporate against a liability incurred as such a director, secretary or executive officer to the extent permitted
by the Corporations Act 2001. The contract of insurance prohibits disclosure of the nature of the liability and
the amount of the premium.
27
Directors’ Report
Additional Information (continued)
(c) Agreement to indemnify officers
The Group has entered into agreements with the directors to provide access to Group records and to
indemnify them. The indemnity relates to any liability as a result of being, or acting in their capacity as, an
officer of the Company to the maximum extent permitted by law; and for legal costs incurred in successfully
defending civil or criminal proceedings. No liability has arisen under these indemnities as at the date of this
report.
(d) Proceedings on behalf of the Group
No person has applied to the court under Section 237 of the Corporations Act 2001 for leave to bring
proceedings on behalf of the Group, or to intervene in any proceedings to which the Group is a party, for the
purpose of taking responsibility on behalf of the Group for all or part of those proceedings. No proceedings
have been brought or intervened in on behalf of the Group with leave of the court under Section 237.
(e) Non-audit services
No non-audit services were provided by the auditor or any entity associated with the auditor for the year
ended 30 June 2020 (2019: Nil).
(f)
Corporate Governance
The Directors of the Group support and adhere to the principles of corporate governance, recognising the
need for the highest standard of corporate behaviour and accountability. Please refer to the corporate
governance statement dated 29 September 2016 released to ASX and posted on the Company’s website
www.metalicity.com.au.
(g) Environmental Liabilities
There are no environmental liabilities at the date of this report.
Auditor’s independence declaration
The auditor’s independence declaration is included on page 30 of the annual report.
This Directors’ report is signed in accordance with a resolution of Directors made pursuant to s.298 (2) of the
Corporations Act 2001.
On behalf of the Directors
Jason Livingstone
Managing Director
Perth, Western Australia
30 September 2020
28
Corporate Governance Statement
For the year ended 30 June 2020
The Company’s Corporate Governance Statement and Appendix 4G can be found on the Company’s website
at www.metalicity.com.au/corporate/corporate-governance/ and was approved by the Board on 30
September 2020 and is current as at 30 September 2020.
The Board of Directors (“the Board”) is responsible for the corporate governance of the Company. The Board
guides and monitors the business and affairs of the Company on behalf of the shareholders by whom they
are elected and to whom they are accountable.
Corporate Governance Statement outlines the main Corporate Governance practices in place throughout the
financial year, which comply with the ASX Corporate Governance Council’s Corporate Governance Principles
and Recommendations 3rd edition unless otherwise stated.
29
Stantons International Audit and Consulting Pty Ltd
trading as
Chartered Accountants and Consultants
PO Box 1908
West Perth WA 6872
Australia
Level 2, 1 Walker Avenue
West Perth WA 6005
Australia
Tel: +61 8 9481 3188
Fax: +61 8 9321 1204
ABN: 84 144 581 519
www.stantons.com.au
RE: METALICITY LIMITED
Corporations Act 2001
STANTONS INTERNATIONAL AUDIT AND CONSULTING PTY LTD
Martin Michalik
Director
Liability limited by a scheme approved
under Professional Standards Legislation
Stantons International Audit and Consulting Pty Ltd
trading as
Chartered Accountants and Consultants
TO THE MEMBERS OF
METALICITY LIMITED
Report on the Audit of the Financial Report
Opinion
PO Box 1908
West Perth WA 6872
Australia
Level 2, 1 Walker Avenue
West Perth WA 6005
Australia
Tel: +61 8 9481 3188
Fax: +61 8 9321 1204
ABN: 84 144 581 519
www.stantons.com.au
.
Basis for Opinion
Key Audit Matters
Liability limited by a scheme approved
under Professional Standards Legislation
Key Audit Matters
How the matter was addressed in the audit
Carrying Value of Capitalised Exploration and
Evaluation Expenditure including Asset held
for Sale.
Other Information
Responsibilities of the Directors for the Financial Report
Auditor's Responsibilities for the Audit of the Financial Report
.
Report on the Remuneration Report
Opinion on the Remuneration Report
Corporations Act 2001.
STANTONS INTERNATIONAL AUDIT AND CONSULTING PTY LTD
(Trading as Stantons International)
(An Authorised Audit Company)
Martin Michalik
Directors’ declaration
In the directors’ opinion:
1.
the financial statements and notes set out on pages 36 to 67 are in accordance with the Corporations
Act 2001, including:
(a)
(b)
complying with Accounting Standards, the Corporations Regulations 2001 and other mandatory
professional reporting requirements; and
giving a true and fair view of the Consolidated Entity’s financial position as at 30 June 2020 and
of its performance for the financial year ended on that date; and
2.
3.
4.
there are reasonable grounds to believe that the Consolidated Entity will be able to pay its debts as
and when they become due and payable;
the financial statements and notes thereto are in accordance with International Financial Reporting
Standards issued by the International Accounting Standards Board; and
the audited remuneration disclosures set out on pages 20 to 26 of the Directors’ Report comply with
accounting standard AASB 124 Related Party Disclosures and the Corporations Regulations 2001.
The directors have been given the declarations required by Section 295(A) of the Corporations Act 2001
from the Managing Director and the Company Secretary for the year ended 30 June 2020.
This declaration is made in accordance with a resolution of the directors.
Jason Livingstone
Managing Director
Perth, Western Australia
30 September 2020
35
Consolidated statement of profit or loss and other comprehensive income
for the financial year ended 30 June 2020
Continuing operations
Revenue
Expenses
Loss from continuing operations before income tax
Income tax expense
Loss after income tax from continuing operations
Other comprehensive income
Items that may be reclassified subsequently to profit or
loss
Items that will not be reclassified subsequently to profit
or loss
Foreign currency translation
Other comprehensive loss for the period, net of tax
Consolidated Group
2020
$
Restated
2019
$
570,882
(1,911,639)
(1,340,757)
-
(1,340,757)
327,544
(4,737,920)
(4,410,376)
-
(4,410,376)
Note
4
5
6
-
-
-
-
(13,076)
(13,076)
(35,676)
(35,676)
Total comprehensive loss for the year
(1,353,833)
(4,446,052)
Loss attributable to:
Owners of the parent
Non-controlling interest
Total comprehensive loss attributable to:
Owners of the parent
Non-controlling interest
Basic loss per share (cents)
- Continuing operations
Diluted loss per share (cents)
- Continuing operations
(1,274,669)
(66,088)
(1,340,757)
(4,190,963)
(219,413)
(4,410,376)
(1,301,384)
(52,449)
(1,353,833)
(4,219,903)
(226,149)
(4,446,052)
23(a)
23(b)
(0.17)
(0.17)
(0.17)
(0.17)
(0.70)
(0.70)
(0.70)
(0.70)
The above consolidated statement of profit or loss and other comprehensive income should be read in
conjunction with the accompanying notes.
36
Consolidated statement of financial position
as at 30 June 2020
Current assets
Cash and cash equivalents
Trade and other receivables
Other assets
Held for sale
Total current assets
Non-current assets
Exploration and evaluation expenditure
Plant & equipment
Total non-current assets
Note
7(a)
8
9
10
11
Consolidated Group
2020
$
Restated
2019
$
1,108,285
121,200
270,804
1,420,616
2,920,905
1,160,907
1,127
1,162,034
666,560
76,723
499,847
2,734,940
3,978,070
204,133
1,191
205,324
Total assets
4,082,939
4,183,394
Current liabilities
Trade and other payables
Provisions
Shares to be issued
Liabilities related to assets held for sale
Total current liabilities
Total liabilities
Net assets
Equity
Issued capital
Other reserves
Accumulated losses
Parent Entity Interest
Non Controlling Interest
Total equity
12
13
10
14
24
730,255
38,299
35,654
-
804,208
334,310
22,070
-
1,034,941
1,391,321
804,208
1,391,321
3,278,731
2,792,073
48,568,493
4,240,556
(49,748,188)
46,955,647
4,060,009
(48,473,519)
3,060,861
217,870
2,542,137
249,936
3,278,731
2,792,073
The above consolidated statement of financial position should be read in conjunction with the
accompanying notes.
37
Consolidated statement of changes in equity
for the financial year ended 30 June 2020
Issued
capital
Share
Based
Payments
Reserve
Other
Reserves
Foreign
Currency
Reserve
Accumulated
losses
Non
Controlling
Interest
$
$
$
$
$
$
Total
$
46,955,647
-
4,563,534
(476,085)
1,500
-
(35,676)
6,736
(48,692,932)
219,413
-
249,936
2,792,073
-
46,955,647
4,087,449
1,500
(28,940)
(48,473,519)
249,936
2,792,073
-
-
-
-
-
-
-
-
-
-
(26,715)
(1,274,669)
-
(66,088)
13,639
(1,340,757)
(13,076)
(26,715)
(1,274,669)
(52,449)
(1,353,833)
Balance at 1 July 2019
Balance at 1 July 201
Balance at 1 July 201
Balance at 1 July 201
Balance at 1 July 201
Balance at 1 July 201
Balance at 1 July 201
Correction of error
Correction of error
Correction of error
Correction of error
Correction of error
Correction of error
Correction of error
Balance at 1 July 2019
Balance at 1 July 201
Balance at 1 July 201
Balance at 1 July 201
Balance at 1 July 201
(restated)
(Loss) for the year
(Loss) for the year
(Loss) for the year
(Loss) for the year
(Loss) for the year
(Loss) for the year
Other comprehensive loss
Other comprehensive loss
Other comprehensive loss
Other comprehensive loss
Other comprehensive loss
Other comprehensive loss
Total comprehensive loss
Total comprehensive loss
Total comprehensive loss
Total comprehensive loss
Total comprehensive loss
Total comprehensive loss
for the year
for the year
for the year
for the year
for the year
for the year
Transactions with owners in their capacity as owners
Transactions with owners in their capacity as owners
Transactions with owners in their capacity as owners
Transactions with owners in their capacity as owners
Transactions with owners in their capacity as owners
Transactions with owners in their capacity as owners
Issue of share capital
Issue of share capital
Issue of share capital
Issue of share capital
Issue of share capital
Issue of options
Issue of employee rights
Issue of employee
Issue of employee
Issue of employee
Movement due to increase
Movement due to increase
Movement due to increase
Movement due to increase
Movement due to increase
Movement due to increase
in NCI
in NCI
in NCI
in NCI
in NCI
in NCI
in NCI
Issue costs
Issue
Issue
Issue
Issue
Issue
Issue
1,968,133
-
-
-
162,706
-
(20,383)
-
(355,287)
1,612,846
-
142,323
-
-
64,939
-
-
64,939
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
20,383
-
20,383
1,968,133
162,706
64,939
-
(355,287)
1,840,491
Balance at 30 June 2020
Balance at 30 June 20
Balance at 30 June 20
Balance at 30 June 20
48,568,493
4,229,772
66,439
(55,655)
(49,748,188)
217,870
3,278,731
Issued
capital
$
Share
Based
Payments
Reserve
$
Option
Premium
Reserve
Foreign
Currency
Reserve
Accumulated
losses
Non
Controlling
Interest
$
$
$
$
Balance at 1 July 2018
Balance at 1 July 201
Balance at 1 July 201
Balance at 1 July 201
Balance at 1 July 201
46,638,047
2,025,208
1,500
-
(44,282,556)
(Loss) for the year
(Loss) for the year
(Loss) for the year
(Loss) for the year
(Loss) for the year
(Loss) for the year
(Loss) for the year
Other comprehensive loss
Total comprehensive loss
Total comprehensive loss
for the year
for the year
for the year
for the year
for the year
-
-
-
-
-
-
Transactions with owners in their capacity as owners
Transactions with owners in their capacity as owners
Transactions with owners in their capacity as owners
Transactions with owners in their capacity as owners
Transactions with owners in their capacity as owners
Transactions with owners in their capacity as owners
Transactions with owners in their capacity as owners
Issue of share capital
Issue of share capital
Issue of share capital
Issue of share capital
Issue of share capital
Issue of share capital
Issue of share capital
Issue of KML warrants
Issue of
Issue of employee options
Issue of employee options
Deferred transaction costs
Deferred transaction costs
Deferred transaction costs
Deferred transaction costs
157,600
-
-
160,000
317,600
-
2,521,637
16,689
-
2,538,326
-
-
-
-
-
-
-
-
-
(35,676)
(4,410,376)
-
(35,676)
(4,410,376)
-
-
-
-
-
-
-
-
-
-
Balance at 30 June 2019
46,955,647
4,563,534
1,500
(35,676)
(48,692,932)
-
-
-
-
-
-
-
-
-
-
The above consolidated statement of changes in equity should be read in conjunction with the
accompanying notes.
Total
$
4,382,199
(4,410,376)
(35,676)
(4,446,052)
157,600
2,521,637
16,689
160,000
2,855,926
2,792,073
38
Consolidated statement of cash flows
for the financial year ended 30 June 2020
Consolidated Group
Cash flows from operating activities
Payments to suppliers and employees
R& D Rebate
Lease income
Government stimulus
Interest received
Net cash used in operating activities
Cash flows from investing activities
Proceeds from sale of royalty
Proceeds from sale of shares
Proceeds from sale of tenements
Payment for exploration and in relation to
tenements
Payments for assets held for sale
Net cash (used in)/provided by investing activities
Cash flows from financing activities
Proceeds from shares issued
Proceeds from option conversions
Proceeds from option conversions to be issued
KML capital raised
Transaction costs
Net cash provided by financing activities
Net increase/(decrease) in cash and cash
equivalents
Cash and cash equivalents at the beginning of
the financial year
Effect of exchange rates on cash holdings in
foreign currencies
Cash and cash equivalents at the end of the
financial year
Note
2020
$
7(b)
(752,277)
-
22,937
16,572
1,040
(711,728)
200,000
78,872
64,870
(992,464)
-
(648,722)
1,927,709
36,257
35,654
-
(192,571)
1,807,049
Restated
2019
$
(4,219,170)
80,440
67,992
-
4,426
(4,066,312)
-
44,125
1,519,007
(826,872)
(500,000)
236,260
157,600
-
-
2,521,637
-
2,679,237
446,599
(1,150,815)
666,560
1,866,233
(4,874)
7(a)
1,108,285
(48,858)
666,560
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes.
39
Notes to Financial Statements for the financial year ended 30 June 2020
1. General information
Metalicity Limited (“the Company” or “MCT”) is a company limited by shares, incorporated and domiciled
in Australia. Its shares are listed on the Australian Securities Exchange. MCT and its wholly owned
subsidiaries, Metalicity Energy Pty Ltd and KYM Mining Pty Ltd and its approximate 80.3% interest in
Kimberly Mining Limited, Kimberly Mining Australia Pty Ltd, Kimberly Mining Holdings Pty Ltd and
Ridgecape Holdings Pty Ltd, are referred to as the ‘Group’ or ‘Consolidated Entity’.
The Financial Report of MCT for the year ended 30 June 2020 was authorised for issue in accordance
with a resolution of the board of directors on 30 September 2020.
2.
Significant accounting policies
The principal accounting policies adopted in the preparation of the Financial Report are set out below.
These policies have been consistently applied to the years presented, unless otherwise stated.
(a) Basis of preparation
This general purpose Financial Report has been prepared in accordance with Australian Accounting
Standards, other authoritative pronouncements of the Australian Accounting Standards Board (AASB),
Australian Accounting Interpretations and the Corporations Act 2001.
It is recommended that this financial report be read in conjunction with the public announcements made
by the Company during the year in accordance with the continuous disclosure requirements arising
under the ASX Listing Rules.
Compliance with IFRS
Australian Accounting Standards include Australian equivalents to International Financial Reporting
Standards (AIFRS). Compliance with AIFRS ensures that the Financial Report of the Group complies
with International Financial Reporting Standards (IFRS).
Historical cost convention
These financial statements have been prepared under the historical cost convention.
Critical accounting estimates
The preparation of financial statements in conformity with AIFRS requires the use of certain critical
accounting estimates. It also requires management to exercise its judgment in the process of applying
the Group’s accounting policies. Where these are areas involving a higher degree of judgement or
complexity, or areas where assumptions and estimates are significant to the financial statements, these
are disclosed in Note 2(r).
Comparative figures
When required by accounting standards, comparative figures have been adjusted to conform to changes
in presentation for the current year. When the Group applies an accounting policy retrospectively, makes
a retrospective restatement or reclassifies items in its financial statements, a statement of financial
position as at the beginning of the earliest comparative period will be disclosed.
Going concern basis
The financial statements have been prepared on the going concern basis which contemplates the
continuity of normal business activity and the realisation of assets and the settlement of liabilities in the
normal course of business. For the year ended 30 June 2020 the Group incurred a loss after tax of
$1,340,757 (2019: $4,410,376) and a net cash outflow from operations of $711,728 (2019: $4,066,312).
At 30 June 2020, the Group has working capital surplus of $2,116,697 (2019: working capital of
$2,586,749) and current cash holding was $1,108,285 (2019: $666,560).
The directors have reviewed the business outlook and cash flow forecasts and are of the opinion that
the use of the going concern basis of accounting is appropriate as they believe the Group has raised
sufficient cash to continue operating beyond 12 months and will continue to raise further funds through
subsequent capital raisings and will meet its expenditure commitments as required.
40
Notes to Financial Statements for the financial year ended 30 June 2020
2.
Significant accounting policies (continued)
(b) Correction of prior-period errors
During the current reporting period, the Group reviewed its consolidation worksheets to ensure all non-
controlling interests in Kimberley Mining Limited had been appropriately disclosed. Consequently, there
were errors noted, which have been corrected and the non-controlling interest in Kimberley Mining
Limited have been restated to ensure they reflect the correct position at 30 June 2020.
30 June 2019 Comparatives
The impact of the correction of the error on the 30 June 2019 comparatives is summarised as follows:
Consolidated Statement of Financial
Position (Extract)
Equity
Reserves
30 June 2019
(Previously
Reported)
Increase /
(Decrease)
30 June 2019
Restated
46,955,647
-
46,955,647
4,529,358
(469,349)
4,060,009
Accumulated Losses
(48,692,932)
219,413
(48,473,519)
Non-Controlling Interest
-
249,936
249,936
Consolidated Statement of Financial Position amounts other than those mentioned above were not
affected by the correction of prior period error.
Consolidated Statement of Profit or Loss and
other Comprehensive Income (Extract)
Gain/(Loss) attributable to:
Owners of the parent
Non-controlling interest
Total comprehensive gain/(loss) attributable
to:
Owners of the parent
Non-controlling interest
30 June 2019
(Previously
Reported)
Increase /
(Decrease)
30 June 2019
Restated
(4,410,376)
-
219,413
(219,413)
(4,190,963)
(219,413)
(4,446,052)
-
226,149
(226,149)
(4,219,903)
(226,149)
Consolidated Statement of Profit or Loss and other Comprehensive Income amounts other than those
mentioned above were not affected by the correction of prior period error.
41
Notes to Financial Statements for the financial year ended 30 June 2020
2.
Significant accounting policies (continued)
(c) Principles of Consolidation
The consolidated financial statements incorporate the assets and liabilities of subsidiaries of the
Company as at 30 June 2020 and the results of the subsidiaries for the period then ended.
Metalicity Energy Pty Ltd, KYM Mining Pty Ltd, Ridgecape Holdings Pty Ltd, Kimberly Mining Australia
Pty Ltd, Kimberly Mining Holdings Pty Ltd and Kimberly Mining Limited are the subsidiaries over which
the Company has the power to govern the financial and operating policies as the holder of all of the
voting rights. The subsidiaries are fully consolidated from the date of acquisition of the subsidiary.
Consolidation will cease from the date that control of the subsidiary ceases. Any and all intercompany
transactions and balances between the Company and the subsidiary are eliminated on consolidation.
(d) Business combinations
Acquisitions of businesses are accounted for using the acquisition method. The consideration
transferred in a business combination is measured at fair value which is calculated as the sum of the
acquisition-date fair values of assets less liabilities transferred to the Group, liabilities incurred by the
Group to the former owners of the acquiree and the equity instruments issued by the Group in exchange
for control of the acquiree. Acquisition-related costs are recognised in profit or loss as incurred.
At the acquisition date, the identifiable assets acquired and the liabilities assumed are recognised at
their fair value, except that:
• deferred tax assets or liabilities and assets or liabilities related to employee benefit arrangements
are recognised and measured in accordance with AASB 112 ‘Income Taxes’ and AASB 119
‘Employee Benefits’ respectively;
•
liabilities or equity instruments related to share-based payment arrangements of the acquiree or
share-based payment arrangements of the Group entered into to replace share-based payment
arrangements of the acquiree are measured in accordance with AASB 2 ‘Share-based Payment’ at
the acquisition date; and
• Assets (or disposal groups) that are classified as held for sale in accordance with AASB 5
‘Noncurrent Assets Held for Sale and Discontinued Operations’ are measured in accordance with
that Standard.
Goodwill is measured as the excess of the sum of the consideration transferred, the amount of any non-
controlling interests in the acquiree, and the fair value of the acquirer's previously held equity interest in
the acquiree (if any) over the net of the acquisition-date amounts of the identifiable assets acquired and
the liabilities assumed. If, after reassessment, the net of the acquisition-date amounts of the identifiable
assets acquired and liabilities assumed exceeds the sum of the consideration transferred, the amount
of any non-controlling interests in the acquiree and the fair value of the acquirer's previously held interest
in the acquiree (if any), the excess is recognised immediately in profit or loss as a bargain purchase
gain.
(e) Revenue recognition
Revenue is measured at the fair value of the consideration received or receivable.
Sale of Goods
Revenue from sale of goods in the course of ordinary activities is brought to account when
delivered to the customer and selling prices are known or can be reasonably estimated.
Government Tax Credits and Rebates
Government tax credits and rebates, inclusive of research and development tax credit, are
recognised as income at their fair value where there is a reasonable assurance that the grant or
rebate will be received and the Group will comply with all attached conditions.
42
Notes to Financial Statements for the financial year ended 30 June 2020
2.
Significant accounting policies (continued)
(e) Revenue recognition (continued)
Royalties Income
Revenue from the sale of Royalties rights accounted during the year due to disposal of royalties to third
party.
Interest Income
Interest revenue is recognised on a time proportionate basis using the effective interest method.
Sale of tenement income
Revenue from the sale of tenements accounted during the year due to disposal of tenements to third
party.
(f) Cash and Cash Equivalents
For statement of cash flow presentation purposes, cash and cash equivalents includes cash on hand,
deposits held at call with banks, other short-term highly liquid investments with original maturities of
three months or less, and bank overdrafts.
(g) Income Tax
The income tax expense or revenue for the period is the tax payable on a current period’s taxable
income based on the income tax rate adjusted by changes in deferred tax assets and liabilities
attributable to temporary differences and to unused tax losses.
Deferred tax is accounted for using the liability method in respect of temporary differences arising
between the tax bases of assets and liabilities and their carrying amounts in the financial statements.
No deferred income tax will be recognised from the initial recognition of an asset or liability, excluding a
business combination, where there is no effect on accounting or taxable profit or loss.
Deferred tax is calculated at the tax rates that are expected to apply to the period when the asset is
realised or liability is settled. Deferred tax is credited in the income statement except where it relates to
items that may be credited directly to equity, in which case the deferred tax is adjusted directly against
equity. Deferred income 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 tax losses.
(h) Exploration Expenditure
Exploration and evaluation expenditure incurred on granted exploration licences is accumulated in
respect of each identifiable area of interest. These costs are carried forward where the rights to tenure
of the area of interest are current and to the extent that they are expected to be recouped through the
successful development of the area or where activities in the area have not yet reached a stage that
permits reasonable assessment of the existence of economically recoverable reserves. Accumulated
costs in relation to any abandoned area will be written off in full against profit in the year in which the
decision to abandon the area is made. When production commences, the accumulated costs for the
relevant area of interest will be amortised over the life of the area according to the rate of depletion of
the economically recoverable reserves. A regular review will be undertaken of each area of interest to
determine the appropriateness of continuing to carry forward costs in relation to that area of interest.
(i) Trade and other receivables
Trade and other receivables are initially recognised at fair value and subsequently measured at
amortised costs using the effective interest method, less provision for impairment. Trade and other
receivables are generally receivable within 30 days. Collectability of trade receivables is reviewed on
an ongoing basis. Amounts that are known to be uncollectible are written off by reducing the carrying
amount directly.
43
Notes to Financial Statements for the financial year ended 30 June 2020
2.
Significant accounting policies (continued)
(j) Trade and other payables
These amounts represent liabilities for goods and services provided to the Group prior to the end of the
financial year which are unpaid. The amounts are unsecured and usually paid within 30 days of
recognition.
(k) Borrowings
Loans are carried at their principal amounts, which represent the present value of future cash flows
associated with servicing the debt. Interest is accrued over the period it becomes due and is recorded
as part of other creditors.
(l) Contributed equity
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new
shares or options are shown in equity as a deduction from the proceeds.
(m) Earnings per share
Basic earnings per share (“EPS”) is calculated by dividing the result attributable to equity holders of the
Company by the weighted number of shares outstanding during the year. Diluted EPS adjusts the
figures used in the calculation of basic EPS 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 or known to have been issued in relation to dilutive potential ordinary shares.
(n) Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST, except where the amount
of GST incurred is not recoverable from the Australian Tax Office. In these circumstances the GST is
recognised as part of the cost of acquisition of the asset or as part of an item of the expense.
Receivables and payables in the statement of financial position are shown inclusive of GST. Cash flows
are presented in the statement of cash flow on a gross basis, except for the GST component of investing
and financing activities, which are disclosed as operating cash flows.
(o) Employee Benefits
Provision is made for the Group’s liability for employee benefits arising from services rendered by
employees to balance date. Employee benefits that are expected to be settled within one year have
been measured at the amounts expected to be paid when the liability is settled. Employee benefits
payable later than one year have been measured at the present value of the estimated future cash
outflows to be made for those benefits. Those cash flows are discounted using market yields on national
government bonds with terms to maturity that match the expected timing of cash flows. In calculating
the present value of future cash flows in respect of long service leave, the probability of long service
leave being taken is based on historical data.
(p) Equity-Settled Compensation
The Group operates equity-settled share-based payment share and option schemes to Directors and
employees. The fair value of the equity to which Directors and employees become entitled is measured
at grant date and recognised as an expense over the vesting period, with a corresponding increase to
an equity account. The fair value of shares is ascertained as the market bid price. The fair value of
options is ascertained using a Binomial or Black and Scholes pricing model which incorporates all
market vesting conditions. The number of shares and options expected to vest is reviewed and adjusted
at each reporting date such that the amount recognised for services received as consideration for the
equity instruments granted shall be based on the number of equity instruments that eventually vest.
44
Notes to Financial Statements for the financial year ended 30 June 2020
2.
Significant accounting policies (continued)
(q) Financial Instruments
Recognition, initial measurement and derecognition
Financial assets and financial liabilities are recognised when the Group becomes a party to the
contractual provisions of the financial instrument. Financial instruments (except for trade receivables)
are measured initially at fair value adjusted by transactions costs, except for those carried “at fair value
through profit or loss”, in which case transaction costs are expensed to profit or loss. Where available,
quoted prices in an active market are used to determine the fair value. In other circumstances, valuation
techniques are adopted. Subsequent measurement of financial assets and financial liabilities are
described below.
Trade receivables are initially measured at the transaction price if the receivables do not contain a
significant financing component in accordance with AASB 15.
Financial assets are derecognised when the contractual rights to the cash flows from the financial asset
expire, or when the financial asset and all substantial risks and rewards are transferred. A financial
liability is derecognised when it is extinguished, discharged, cancelled or expires.
Classification and subsequent measurement
Financial assets
Except for those trade receivables that do not contain a significant financing component and are
measured at the transaction price in accordance with AASB 15, all financial assets are initially measured
at fair value adjusted for transaction costs (where applicable).
For the purpose of subsequent measurement, financial assets other than those designated and effective
as hedging instruments, are classified into the following categories upon initial recognition:
amortised cost;
fair value through other comprehensive income (FVOCI); and
fair value through profit or loss (FVPL).
Classifications are determined by both:
The contractual cash flow characteristics of the financial assets; and
The entities business model for managing the financial asset.
Financial assets at amortised cost
Financial assets are measured at amortised cost if the assets meet the following conditions (and are
not designated as FVPL):
they are held within a business model whose objective is to hold the financial assets and collect
its contractual cash flows; and
the contractual terms of the financial assets give rise to cash flows that are solely payments of
principal and interest on the principal amount outstanding.
After initial recognition, these are measured at amortised cost using the effective interest method.
Discounting is omitted where the effect of discounting is immaterial. The Group’s cash and cash
equivalents, trade and most other receivables fall into this category of financial instruments.
Financial assets at fair value through other comprehensive income (Equity instruments)
The Group measures debt instruments at fair value through OCI if both of the following conditions are
met:
The contractual terms of the financial asset give rise on specified dates to cash flows that are
solely payments of principal and interest on the principal amount outstanding; and
45
Notes to Financial Statements for the financial year ended 30 June 2020
2.
Significant accounting policies (continued)
(q)
Financial Instruments (continued)
The financial asset is held within a business model with the objective of both holding to collect
contractual cash flows and selling the financial asset.
For debt instruments at fair value through OCI, interest income, foreign exchange revaluation and
impairment losses or reversals are recognised in the statement of profit or loss and computed in the
same manner as for financial assets measured at amortised cost. The remaining fair value changes are
recognised in OCI.
Upon initial recognition, the Group can elect to classify irrevocably its equity investments as equity
instruments designated at fair value through OCI when they meet the definition of equity under AASB
132Financial Instruments: Presentation and are not held for trading.
Financial assets at fair value through profit or loss (FVPL)
Financial assets at fair value through profit or loss include financial assets held for trading, financial
assets designated upon initial recognition at fair value through profit or loss, or financial assets
mandatorily required to be measured at fair value. Financial assets are classified as held for trading if
they are acquired for the purpose of selling or repurchasing in the near term.
Financial liabilities
Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit
or loss, loans and borrowings, payables, or as derivatives designated as hedging instruments in an
effective hedge, as appropriate.
Financial liabilities are initially measured at fair value, and, where applicable, adjusted for transaction
costs unless the Group designated a financial liability at fair value through profit or loss.
Subsequently, financial liabilities are measured at amortised cost using the effective interest method
except for derivatives and financial liabilities designated at FVPL, which are carried subsequently at fair
value with gains or losses recognised in profit or loss.
All interest-related charges and, if applicable, gains and losses arising on changes in fair value are
recognised in profit or loss.
Impairment
The Group assesses on a forward looking basis the expected credit losses associated with its debt
instruments carried at amortised cost and FVOCI. The impairment methodology applied depends on
whether there has been a significant increase in credit risk. For trade receivables, the Group applies the
simplified approach permitted by AASB, which requires expected lifetime losses to be recognised from
initial recognition of the receivables.
The classification depended on the purpose for which the investments were acquired. Management
determined the classification of its investments at initial recognition and, in the case of assets classified
as held-to-maturity, re-evaluated this designation at the end of each reporting period.
Valuation techniques
In the absence of an active market for an identical asset or liability, the Group selects and uses one or
more valuation techniques to measure the fair value of the asset or liability. The Group selects a
valuation technique that is appropriate in the circumstances and for which sufficient data is available to
measure fair value. The availability of sufficient and relevant data primarily depends on the specific
characteristics of the asset or liability being measured. The valuation techniques selected by the Group
are consistent with one or more of the following valuation approaches:
Market approach: valuation techniques that use prices and other relevant information generated
by market transactions for identical or similar assets or liabilities.
Income approach: valuation techniques that convert estimated future cash flows or income and
expenses into a single discounted present value.
46
Notes to Financial Statements for the financial year ended 30 June 2020
2.
Significant accounting policies (continued)
(q)
Financial Instruments (continued)
Cost approach: valuation techniques that reflect the current replacement cost of an asset at its
current service capacity.
Each valuation technique requires inputs that reflect the assumptions that buyers and sellers would use
when pricing the asset or liability, including assumptions about risks. When selecting a valuation
technique, the Group gives priority to those techniques that maximise the use of observable inputs and
minimise the use of unobservable inputs. Inputs that are developed using market data (such as publicly
available information on actual transactions) and reflect the assumptions that buyers and sellers would
generally use when pricing the asset or liability are considered observable, whereas inputs for which
market data is not available and therefore are developed using the best information available about
such assumptions are considered unobservable.
Fair value hierarchy
AASB 13 requires the disclosure of fair value information by level of the fair value hierarchy, which
categorises fair value measurements into one of three possible levels based on the lowest level that an
input that is significant to the measurement can be categorised into as follows:
Level 1
Measurements based on quoted prices (unadjusted) in active markets for identical assets or liabilities
that the entity can access at the measurement date.
Level 2
Measurements based on inputs other than quoted prices included in Level 1 that are observable for the
asset or liability, either directly or indirectly
Level 3
Measurements based on unobservable inputs for the asset or liability.
The fair values of assets and liabilities that are not traded in an active market are determined using one
or more valuation techniques. These valuation techniques maximise, to the extent possible, the use of
observable market data. If all significant inputs required to measure fair value are observable, the asset
or liability is included in Level 2. If one or more significant inputs are not based on observable market
data, the asset or liability is included in Level 3.
The Group would change the categorisation within the fair value hierarchy only in the following
circumstances:
(i) if a market that was previously considered active (Level 1) became inactive (Level 2 or Level 3)
or vice versa; or
(ii) if significant inputs that were previously unobservable (Level 3) became observable (Level 2)
or vice versa.
When a change in the categorisation occurs, the Group recognises transfers between levels of the fair
value hierarchy (i.e. transfers into and out of each level of the fair value hierarchy) on the date the event
or change in circumstances occurred.
(r) Critical Accounting Estimates and Judgements
The Directors evaluate estimates and judgements incorporated into the financial report based on
historical knowledge and best available current information. Estimates assumed a reasonable
expectation of future events and are based on current trends and economic data, obtained both
externally and within the Group.
47
Notes to Financial Statements for the financial year ended 30 June 2020
2.
Significant accounting policies (continued)
(r) Critical Accounting Estimates and Judgements (continued)
Key Estimates – Impairment
The Group assesses impairment at each reporting date by evaluating conditions specific to the Group
that may lead to an impairment of assets. Where an impairment trigger exists, the recoverable amount
of the asset is determined. Value-in- use calculations performed in assessing recoverable amounts
incorporate a number of key estimates. This includes as assessment of the carrying values of
intangibles and capitalised exploration and evaluation costs
Key Estimates – Share based payment transactions
The Group measures the cost of equity-settled transactions with employees (including directors) by
reference to the fair value of the equity instruments at the date at which they are granted. The fair value
is determined by an internal valuation using a Black-Scholes option pricing model, using the
assumptions detailed in Note 16.
Key Estimates – Exploration expenditure
The write-off and carrying forward of exploration acquisition costs is based on an assessment of an area
of interest’s viability and/or the existence of economically recoverable reserves.
Key Estimates – Deferred taxation
Deferred tax assets in respect of tax losses have not been brought to account as it is not considered
probable that future taxable profits will be available against which they could be utilised
(s) Application of new and revised Accounting Standards
The Group has considered the implications of new and amended Accounting Standards which have
become applicable for the current financial reporting period. The Group had to change its accounting
policies as a result of adopting the following Standard:
- AASB 16: Leases
The Group had 1 lease during the year which was terminated prior to 30 June 2020, therefore the
adoption of AASB 16 does not have a significant impact on the financial report.
Leases
The Group as lessee
At inception of a contract the Group assesses if the contract contains or is a lease. If there is a lease
present, a right-of-use asset and a corresponding liability are recognised by the Group where the Group
is a lessee. However, all contracts that are classified as short-term leases (i.e. leases with a remaining
lease term of 12 months or less) and leases of low-value assets are recognised as an operating expense
on a straight-line basis over the term of the lease.
Initially, the lease liability is measured at the present value of the lease payments still to be paid at the
commencement date. The lease payments are discounted at the interest rate implicit in the lease. If this
rate cannot be readily determined, the Group uses incremental borrowing rate.
Lease payments included in the measurement of the lease liability are as follows;
fixed lease payments less any lease incentives;
-
- variable lease payments that depend on index or rate, initially measured using the index or rate at
the commencement date;
the amount expected to be payable by the lessee under residual value guarantees;
the exercise price of purchase options if the lessee is reasonably certain to exercise the options;
-
-
48
Notes to Financial Statements for the financial year ended 30 June 2020
2.
Significant accounting policies (continued)
(s) Application of new and revised Accounting Standards (continued)
-
lease payments under extension options, if the lessee is reasonably certain to exercise the options;
and
- payments of penalties for terminating the lease, if the lease term reflects the exercise of options to
terminate the lease.
The right-of-use asses comprise the initial measurement of the corresponding lease liability, any lease
payments made at or before the commencement date and any initial direct costs. The subsequent
measurement of the right-of-use assets is at cost less accumulated depreciation and impairment losses.
Right-of-use assets are depreciated over the lease term or useful life of the underlying asset, whichever
is the shortest.
Where a lease transfers ownership of the underlying asset or the costs of the right-of-use asset reflects
that the Group anticipates to exercise a purchase option, the specific asset is depreciated over the
useful life of the underlying asset.
Initial Application of AASB 16: Leases
The Group has adopted AASB 16: Leases retrospectively with the cumulative effect of initially applying
AASB 16 recognised as 1 July 2019. In accordance with AASB 16, the comparatives for the 2019
reporting period have not been restated.
The following practical expedients have been used by the Group in applying AASB 16 Leases for the
first time:
- Leases that have remaining lease term of less than 12 months as at 1 July 2019 have been
accounted for in the same way as short-term lease.
Other standards not yet applicable
There are no other standards that are not yet effective and that would be expected to have a material
impact on the entity in the current or future reporting periods and on foreseeable future transactions.
(t) Foreign Currency Transactions and Balances
The functional currency of each of the Group’s entities is measured using the currency of the primary economic
environment in which that entity operates. The consolidated financial statements are presented in Australian dollars
which is the parent entity’s functional currency. The functional currency of Canadian subsidiary is Canadian Dollars.
Transaction and balances
Foreign currency transactions are translated into the functional currency using the exchange rates
prevailing at the date of the transaction. Foreign currency monetary items are translated at the year-end
exchange rate. Non-monetary items measured at historical cost continue to be carried at the exchange
rate at the date of the transaction. Non- monetary items measured at fair value are reported at the
exchange rate at the date when fair values were determined.
Exchange differences arising on the translation of monetary items are recognised in profit or loss, except
where deferred in equity when the exchange difference arises on monetary items receivable from or
payable to a foreign operation for which settlement is neither planned nor likely to occur (therefore
forming part of the net investment in the foreign operation).
Exchange differences arising on the translation of non-monetary items are recognised directly in other
comprehensive income to the extent that the underlying gain or loss is recognised in other
comprehensive income, otherwise the exchange difference is recognised in the profit or loss.
49
Notes to Financial Statements for the financial year ended 30 June 2020
2.
Significant accounting policies (continued)
(t) Foreign Currency Transactions and Balances (continued)
Group companies
The financial results and position of foreign operations whose functional currency is different from the
Group’s presentation currency are translated as follows:
— Assets and liabilities are translated at exchange rates prevailing at the end of the reporting period;
— Income and expenses are translated at average exchange rates for the period; and
— Retained earnings are translated at the exchange rates prevailing at the date of the transaction.
Exchange differences arising on translation of foreign operations with functional currencies other than
the Australian dollar are recognised in other comprehensive income and included in the foreign currency
translation reserve in the statement of financial position. The cumulative amount of these differences is
reclassified into profit or loss in the period in which the operation is disposed of.
3.
Segment information
Identification of reportable segments
The Group has identified its operating segments based on the internal reports that are reviewed and
used by the Board of Directors (chief operating decision makers) in assessing performance and
determining the allocation of resources.
The Group has two geographic segment being Australia and Canada and operates in one industry being
the exploration of minerals.
Segment result
Segment revenue
Australia
Canada
Segment expenses
Australia
Canada
Income tax
(Loss) after tax
Consolidated
30 June
2020
$
570,882
-
570,882
30 June
2019
$
285,301
42,243
327,544
(1,466,170)
(445,469)
(1,911,639)
(3,140,376)
(1,597,544)
(4,737,920)
-
(1,340,757)
-
(4,410,376)
50
Notes to Financial Statements for the financial year ended 30 June 2020
3.
Segment information (continued)
Segment assets and
liabilities
Consolidated
Consolidated
Non-current assets
Non-current liabilities
Australia
Canada
Australia
Canada
30 June
2020
$
1,162,034
-
1,162,034
30 June
2019
$
205,324
-
205,324
30 June
2020
$
30 June
2019
$
-
-
-
-
-
-
Total assets
Total liabilities
30 June
2020
$
2,641,202
1,441,737
4,082,939
30 June
2019
$
1,385,542
2,797,852
4,183,394
30 June
2020
$
804,208
-
804,208
30 June
2019
$
226,421
1,164,900
1,391,321
4.
Revenue
An analysis of the Group’s revenue for the year is as follows:
Consolidated Group
Sale of Royalty
Gain on revaluation of shares
Lease Income
Interest earned
Gain on sale of shares
Foreign exchange gain
Sale of tenements
Government stimulus
Other
2020
$
200,000
233,833
22,937
1,040
4,795
4,874
64,870
16,572
21,961
570,882
2019
$
80,440
-
67,992
4,426
44,125
48,858
-
-
81,703
327,544
51
Notes to Financial Statements for the financial year ended 30 June 2020
5. Expenses
Accounting & audit
ASX
Company secretarial fees
Consulting fees
Depreciation
Employee benefits
Exploration written-off
Investor relations
KML costs
Legal fees
Project work & generation - cash
Rent & office costs
Share based payments
Share registry fees
Travel & accommodation
Impairment of assets held for sale
Reversal of deferred income
Cost of tenements sold
Other
Total expenses
6.
Income tax expense
Consolidated Group
2020
$
38,974
34,409
52,000
72,129
63
434,372
124,795
50,873
166,086
170,333
91,179
157,190
64,939
39,823
16,613
279,383
-
-
118,478
1,911,639
2019
$
100,377
40,261
54,400
68,789
1,640
615,130
634,834
114,116
678,614
152,032
1,372,772
212,878
16,689
44,022
53,034
6,824,415
(7,053,180)
549,365
257,732
4,737,920
Consolidated Group
2019
$
2020
$
a) Numerical reconciliation of income tax expense to
prima facie tax payable
Loss from continuing operations before income tax expense
(1,340,757)
(4,410,376)
Tax at the Australian tax rate of 27.5% (2019: 27.5%)
(368,708)
(1,212,853)
Tax effect of amounts which are not deductible in calculating
taxable income
Tax effect of amounts which are non (taxable) in calculating
taxable income
R&D Rebate
(Over)/under provision from prior year
59,583
506,027
(368,055)
(355,994)
-
-
(22,121)
(110,765)
Tax losses not recognised
677,180
1,195,706
Prior year losses not recognised, now recognised
Income tax expense
-
-
-
-
52
Notes to Financial Statements for the financial year ended 30 June 2020
6.
Income taxes (continued)
b) Tax losses
Unused tax losses for which no deferred tax asset has been
recognised
Potential tax benefit at 26% (2019: 27.5%)
Consolidated Group
2019
$
2020
$
10,293,144
9,616,234
2,676,217
2,644,464
Tax losses have not been recognised as a deferred tax asset as recoupment is dependent on, amongst
other matters, sufficient future assessable income being earned. That is not considered certain in the
foreseeable future and accordingly there is uncertainty that the losses can be utilised. There are
deferred tax liabilities of approximately $709,919 relating to capitalised exploration costs claimed for tax
as at 30 June 2020 (2019: $56,136). These are offset with the deferred tax assets that have been
recognised to the extent of the deferred tax liabilities.
7. Cash and cash equivalents
(a) Reconciliation of cash and cash equivalents
For the purposes of the statement of cash flows, cash and cash equivalents includes cash on hand and
in banks and investments in money market instruments. Cash and cash equivalents at the end of the
financial year as shown in the consolidated statement of cash flows are reconciled to the related items
in the consolidated statement of financial position as follows:
Cash and cash equivalents
Consolidated Group
2019
2020
$
$
666,560
1,108,285
(b) Reconciliation of loss for the year to net cash flows from operating activities
Loss for the year
Share based payments
Foreign exchange loss/(gain)
Depreciation
Exploration written-off
Gain on revaluation
Gain on sale of listed securities
Cost of tenements sold
Reversal of deferred income
Impairment of asset held for sale
Gain on sale of shares
(Increase) in trade and other receivables and other asset
(Decrease) in trade and other payables
(Decrease)/increase in provisions
Net cash (used in) operating activities
(c) Non cash investing and financing activities
For shares issued to acquire exploration tenements, refer to note 16(a).
(1,340,757)
64,939
(4,874)
63
124,795
(233,833)
(4,795)
-
-
279,383
-
(44,477)
431,599
16,229
(711,728)
(4,410,376)
16,689
48,119
1,640
634,834
-
-
549,365
(7,053,180)
6,824,415
(44,125)
(400,240)
(212,117)
(21,336)
(4,066,312)
53
Notes to Financial Statements for the financial year ended 30 June 2020
8.
Trade and other receivables
GST Receivable
Lease fee receivable
Shares to be issued
None of these receivables are past due or impaired.
9. Other assets
Tenement applications and deposits
Prepayments
Rental security
Shares held for sale(1)
Expenditure incurred
Consolidated Group
2019
2020
$
$
70,246
66,300
6,477
-
-
54,900
76,723
121,200
Consolidated Group
2019
2020
$
$
325,010
34,196
38,500
102,141
499,847
9,558
-
271
260,975
270,804
(1)The Group held 2,087,796 shares in NEX Metals Explorations Limited. This investment is carried at
fair value through profit and loss.
10. Current Assets Held for Sale
Assets Held for sale
Balance at beginning of the period
Capitalisation of exploration expenditure
Impairment of Assets Held for Sale
Sale of tenements(1)
Balance of assets held for sale
Liabilities Related to Non-Current Assets Held for Sale
Balance at beginning of the period
Translation difference
Payment of deferred
acquisition costs(2)
Reversal of deferred income
Settlement of liability(1)
Balance at period end
Consolidated Group
2019
2020
$
$
2,734,940
-
(279,383)
(1,034,941)
1,420,616
9,175,727
383,629
(6,824,416)
-
2,734,940
Consolidated Group
2019
2020
$
$
1,034,941
-
8,553,180
34,941
-
(500,000)
-
(1,034,941)
-
(7,053,180)
1,034,941
(1) During the year ended 30 June 2020, the Company entered into a Deed of Settlement, completed on 11 October
2019, with Meridian (Lennard Shelf Projects) Pty Ltd for the return of the Napier Range assets in satisfaction of the
outstanding liability owing to Meridian (Lennard Shelf Projects) Pty Ltd.
(2) The deferred acquisition costs at 30 June 2018 relate to the final two payments, of $500,000 and $1,000,000,
for the acquisition of the Napier Range tenements. The first payment of $500,000 was made during the year ended
30 June 2019.
54
Notes to Financial Statements for the financial year ended 30 June 2020
11. Exploration and evaluation expenditure
Exploration at cost at the beginning of the period
Acquisition costs
Expenditure incurred
Exploration written-off
Tenements sold
Closing balance
Consolidated Group
2019
2020
$
$
204,133
10,000
1,071,569
(124,795)
-
1,160,907
2,304,094
-
603,245
(634,834)
(2,068,372)
204,133
Total expenditure incurred and carried forward in respect of specific projects
- Kookynie and Yundamindra
- Other
Total carried forward exploration expenditure
1,152,449
8,458
1,160,907
204,133
-
204,133
12. Trade and other payables
Trade payables and accruals
BAS payable
13. Provisions
Consolidated Group
2019
2020
$
$
730,255
-
730,255
320,561
13,749
334,310
Consolidated Group
2019
2020
$
$
Employee benefits – annual leave
38,299
22,070
55
Notes to Financial Statements for the financial year ended 30 June 2020
14.
Issued capital
(a)
Issued share capital
1,397,793,904 (2019: 624,422,475) fully paid ordinary shares
48,568,493
46,955,647
2020
$
2019
$
(b) Movement in ordinary share capital
Date
Details
01/07/2018 Opening balance
12/11/2018 Deferred consideration
10/06/2019 Share placement at $0.06
30/06/2019 Reversal of prior year shares incorrectly issued
30/06/2019 Balance at the end of the year
Date
Details
01/07/2019 Opening balance
12/09/2019 Share placement at $0.06
4/10/2019
Share placement at $0.06
18/10/2019 Share placement at $0.06
14/02/2020 Share placement at $0.006
22/05/2020 Entitlement issue at $0.002
22/05/2020 Share placement at $0.002
15/06/2020 Conversion of options at $0.004
29/06/2020 Conversion of options at $0.004
Issue costs*
30/06/2020 Balance at the end of the year
Number of
shares
592,463,745
10,000,000
22,514,285
(555,556)
624,422,474
Number of
shares
624,422,474
19,966,668
33,843,825
44,976,970
2,027,777
483,491,811
180,000,000
8,104,170
960,209
-
1,397,793,904
$
46,638,047
160,000
157,600
-
46,955,647
$
46,955,647
119,800
203,063
269,861
12,167
966,985
360,000
32,416
3,841
(355,287)
48,568,493
Ordinary shares entitle the holder to participate in dividends and the proceeds on winding up of the
Company in proportion to the number of and amounts paid on the shares held. On a show of hands or
on a poll every holder of ordinary shares present at a meeting in person or by proxy is entitled to one
vote.
*Included in issue costs $162,706 of which relates to options to be issued to brokers.
56
Notes to Financial Statements for the financial year ended 30 June 2020
15.
Options, Performance Rights and Warrants
Options
At year end 30 June 2020, the Company had 347,689,002 options over ordinary shares under issue (30
June 2019: 175,538,837). These options are exercisable as follows:
Details
Management incentive options
Other options
No of
Options
4,500,000
4,500,000
6,500,000
3,150,000
4,550,000
4,550,000
2,500,000
2,500,000
2,500,000
2,000,000
2,000,000
12,766,670
25,709,467
11,257,144
3,000,000
3,000,000
3,993,333
6,768,765
8,995,430
266,667
232,681,526
347,689,002
Grant Date
Date of Expiry Exercise Price $
02/07/2015
02/07/2015
02/07/2015
27/11/2015
27/11/2015
27/11/2015
27/07/2018
27/07/2018
27/07/2018
10/04/2019
10/04/2019
18/08/2017
21/02/2018
10/06/2019
15/03/2018
15/03/2018
09/09/2019
04/10/2019
18/10/2019
14/02/2020
22/05/2020
23/07/2020
23/07/2020
23/07/2020
10/12/2020
10/12/2020
10/12/2020
26/08/2021
26/08/2021
26/08/2021
14/01/2022
14/01/2022
18/08/2020
14/02/2023
31/05/2022
12/03/2021
12/03/2021
09/09/2020
04/10/2020
18/10/2020
18/10/2020
22/05/2022
0.025
0.03
0.04
0.03
0.04
0.05
0.06
0.08
0.10
0.025
0.035
0.08
0.08
0.02
0.06
0.08
0.015
0.015
0.015
0.015
0.004
The weighted average exercise price of the above options is $0.021 (2019: $0.062)
Balance at beginning of the year
Granted during the year (see note 16(a))
Exercised during the year
Forfeited/expired/cancelled during the year
Balance at the end of the year
Performance Rights
2020
No.
175,538,837
261,770,100
(9,064,379)
(80,555,556)
347,689,002
2019
No.
156,781,693
22,757,144
-
(4,000,000)
175,538,837
At the date of this report, the Company had 32,025,000 performance rights over ordinary shares under
issue (30 June 2019: 2,274,713). These performance rights are exercisable as follows:
Details
Performance rights
Performance rights
Performance rights
No of
Performance
Rights
400,000
16,000,000
15,625,000
32,025,000
Grant Date
Date of Expiry Hurdle Price $
31/01/2018
25/11/2019
25/11/2019
15/03/2021
30/01/2023
30/01/2023
0.06
0.025
0.05
57
Notes to Financial Statements for the financial year ended 30 June 2020
15.
Options, Performance Rights and Warrants (continued)
Performance Rights (continued)
Balance at beginning of the year
Granted during the year (Refer 16(a))
Exercised during the year
Forfeited/expired/cancelled during the year
Balance at the end of the year
Capital Management
2020
No.
2,274,713
31,625,000
-
(1,874,713)
32,025,000
2019
No.
2,274,713
-
-
-
2,274,713
Management controls the capital of the Group in order to maintain a sustainable debt to equity ratio,
generate long-term shareholder value and ensure that the Group can fund its operations and continue
as a going concern. The Group’s debt and capital include ordinary share capital and financial liabilities,
supported by financial assets.
The Group is not subject to any externally imposed capital requirements. Management effectively
manages the Group’s capital by assessing the Group’s financial risks and adjusting its capital structure
in response to changes in these risks and in the market. These responses include the management of
debt levels, distributions to shareholders and share issues.
16.
Share Based Payments
(a) Recognised share-based payment expense
The expense recognised for options and shares issued during the year is shown in the table below:
Expense arising from equity-settled share-based payment
transaction:
- Performance rights issued to employees/contractors
- Options issued to employees
Total
Consolidated Group
2019
2020
$
$
64,939
-
64,939
-
16,689
16,689
58
Notes to Financial Statements for the financial year ended 30 June 2020
16.
Share Based Payments (continued)
(a) Recognised share-based payment expense (continued)
The following option and performance right arrangements were issued during the current and prior
reporting periods:
30 June 2020
Options/Performance
Rights
Number
Grant
Date
Expiry
Date
Exercise
Price
Options
Issued 12/09/2019
Issued 04/10/2019
Issued 18/10/2019
Issued 14/02/2020
Issued 10/04/2019
Performance rights
Issued 14/01/2020(2)
Issued 14/01/2020(3)
30 June 2019
Option
Series/Performance
Rights
Options
Issued 29/08/2018
Issued 29/08/2018
Issued 29/08/2018
Issued 10/04/2019
Issued 10/04/2019
09/09/2019
04/10/2019
18/10/2019
14/02/2020
22/05/2020
09/09/2020
04/10/2020
18/10/2020
18/10/2020
22/05/2022
0.015
0.015
0.015
0.015
0.004
Fair Value
at Grant
Date
$0.00(1)
$0.00(1)
$0.00(1)
$0.00(1)
$0.00(4)
25/11/2019
25/11/2019
30/01/2023
30/01/2023
0.00
0.00
$0.00245
$0.00164
3,993,333
6,768,765
8,995,430
266,667
241,745,905
261,770,100
16,000,000
15,625,000
31,625,000
Number
Grant
Date
Expiry
Date
Exercise
Price
2,500,000
2,500,000
2,500,000
2,000,000
2,000,000
11,500,000
27/07/2018
27/07/2018
27/07/2018
10/04/2019
10/04/2019
26/08/2021
26/08/2021
26/08/2021
14/01/2022
14/01/2022
0.06
0.08
0.10
0.025
0.035
Fair Value
at Grant
Date
$0.0015
$0.0006
$0.0003
$0.0030
$0.0024
(1) No fair value is attributable to these options as they are free attaching options issued in relation to
the Placements and Entitlement issues during the year.
(2)Performance rights, with zero exercise price, were granted to employees on 25 November 2019,
which vest when the 20 day VWAP of the share price of the Company exceeds $0.025.
(3)Performance rights, with zero exercise price, were granted to employees on 25 November 2019,
which vest when the 20 day VWAP of the share price of the Company exceeds $0.05.
(4) No fair value attributable to these options as these were listed options issued during the year.
59
Notes to Financial Statements for the financial year ended 30 June 2020
16.
(b)
Share Based Payments (continued)
Types of share-based payment plans
(i)
There were $64,939 share based payments relating to performance rights in 2020 (2019: $16,689).
Options and performance rights
The following tables lists the inputs to the model used to value the performance rights issued during the
financial year ended 30 June 2020:
No of Performance Rights
16,000,000
15,625,000
Grant date
Share price
Exercise price
Risk-free interest rate
Vesting Conditions and Period
Expiry date
Volatility
Fair value at grant date (cents)
Discount for vesting condition
Fair value after discounts (cents)
25/11/19
$0.004
$0.00
0.765%
If 20 day VWAP exceeds
$0.025
30/01/23
138%
0.004
40%
0.00246
25/11/19
$0.004
$0.00
0.765%
If 20 day VWAP exceeds
$0.05
30/01/23
138%
0.004
60%
0.00164
Shares
(ii)
There were no share based payments relating to options in the financial year ended 30 June 2020 (2019:
$1,000,000), apart from performance rights stated above. Please note unlisted options granted during
the year were free attaching options.
Summary of share based payment options granted
(c)
The following table illustrates the number and weighted average exercise price (WAEP) of, and
movements in, share options issued during the year:
2020
No
175,538,837
Outstanding at the beginning of the year
261,770,100
Granted during the year
Exercised during the year
(9,064,379)
Expired/forfeited/cancelled during the year (80,555,556)
Outstanding at the end of the year
347,689,002
2020
WAEP
0.062
0.0048
0.004
0.058
0.021
2019
2019
No WAEP
156,781,693
22,757,144
-
(4,000,000)
0.0646
0.0415
-
0.06
175,538,837
0.062
(d) Weighted average of remaining contractual life
The weighted average remaining contractual life for the share options outstanding as at 30 June 2020
is 1.48 years (2019: 1.56 years).
The weighted average remaining contractual life for the performance rights outstanding as at 30 June
2020 is 1.49 years (2019: 1.70 years)
Range of exercise price
(e)
The range of exercise prices for options outstanding at the end of the year was $0.015-$0.02 (2019:
$0.025-$0.12).
The performance rights do not have an exercise price.
60
Notes to Financial Statements for the financial year ended 30 June 2020
16.
Share Based Payments (continued)
Weighted average fair value
(f)
The weighted average fair value of options granted during the year, excluding free attaching options,
was Nil (2019: $0.0884).
The weighted average fair value of performance rights granted during the year was Nil (2018:
$0.0384)
(g)
The following options were exercised during the year.
Share options exercised during the year
2020
Option Series
Number
Grant
Date
Expiry
Date
Exercise
Price
Issued 22/05/2020
9,064,379 22/05/2020 22/05/2022
$0.004
Fair Value
at Grant
Date
0.004
2019
Nil
(h)
Kimberly Mining Limited Warrants
As at 30 June 2020, there were 31,128,738 in issued common shares in Kimberly Mining Limited and
8,734,370 under warrants (30 June 2019: 14,371,570). These warrants are exercisable/convertible as
follows:
Details
Special Warrants
Special Warrants – Tranche 2
No of Warrants Date of Expiry
5,289,500
3,171,500
8,461,000
23/08/2023
23/09/2023
Conversion Price $
0.4
0.4
Details
Broker Warrants
Broker Warrants – Tranche 2
No of Warrants
176,620
96,750
273,370
Date of Expiry
29/08/2020
28/09/2020
Conversion Price $
0.40
0.40
Special warrants and broker warrants are convertible to 1 ordinary share in Kimberly Mining Limited
upon exercise.
61
Notes to Financial Statements for the financial year ended 30 June 2020
17. Financial Risk Management
Risk management is the role and responsibility of the board. The Group's current activities expose it to
minimal risk. However, as activities increase there may be exposure to interest rate, market, credit, and
liquidity risks.
Interest Rate Risk
(a)
The Group’s exposure to interest rate risk, which is the risk that a financial instrument’s value will
fluctuate as a result of changes in market rates and the effective weighted average interest rates on
classes of financial assets and financial liabilities, is as follows:
Floating
interest
rate
1 year
or
less
Over 1
year to
5 years
More
than 5
years
Non
interest
bearing
Total
$
$
$
$
$
$
30 June 2020
Financial Assets
Cash and deposits
Trade and other receivables
Weighted average interest
rate
Financial liabilities
Trade and other payables
30 June 2019
Financial Assets
Cash and deposits
Trade and other receivables
Weighted average interest
rate
Financial liabilities
Trade and other payables
1,078,677
-
1,078,677
0.40%
-
-
-
-
-
-
-
80,487 20,197
-
80,487 20,197
-
0.81%
2.45%
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
29,608
121,200
150,808
1,108,285
121,200
1,229,485
0.35%
730,255
730,255
730,255
730,255
565,876
76,723
642,599
666,560
76,723
743,283
0.04%
334,310
334,310
334,310
334,310
The Group has interest bearing assets and therefore income and operating cash flows are subject to
changes in the market rates. However, market changes in interest rates will not have a material impact
on the profitability or operating cash flows of the Group. A movement in interest rates of +/- 100 basis
points will result in less than a +/- $10,786 (2019: $800) impact on the Group’s income and operating
cash flows. At this time, no detailed sensitivity analysis is undertaken by the Group.
(b) Market risk
The Group’s listed investments are susceptible to market risk arising from uncertainties about its fair
value. This risk is managed by investing decisions conducted by a committee or Board. The Group held
2,087,796 shares in NEX Metals Explorations Limited valued at $260,975 as at 30 June 2020. This is a
level 1 measurement in accordance with the AASB 13 Fair Value hierarchy.
(c) Credit risk
The Group has no significant concentrations of credit risk and as such, no sensitivity analysis is
prepared by the Group. Credit risk related to balances with banks is managed by ensuring that the
surplus funds are only invested with counterparties with a Standard & Poor’s rating of at least AA-.
62
Notes to Financial Statements for the financial year ended 30 June 2020
17. Financial Risk Management (continued)
(d) Liquidity risk
Prudent liquidity risk management implies maintaining sufficient cash to meet commitments as and
when they fall due. The Group manages liquidity risk by preparing forecasts and monitoring actual cash
flows and requirements for future capital raisings. The Group does not have committed credit lines
available, which is appropriate given the nature of its operations. Surplus funds are invested in a cash
management account with ANZ which is available as required.
The material liquidity risk for the Group is the ability to raise equity in the future.
(e) Effective interest rate and repricing analysis
Cash and cash equivalents are the only interest bearing financial instruments of the Group.
(f) Currency risk
Currency risk arises from investments that are denominated in a currency other than the respective
functional currencies of Group entities.
The Group is exposed to foreign currency risk in the form of financial instruments held in US Dollars
(USD). The Group’s exposure to foreign currency risk at the end of the reporting period, expressed in
Australian dollars, was as follows:
Cash and cash equivalents
Total Exposure
2020
USD$
660
660
2019
USD$
327,015
327,015
Assuming all other variables remain constant, a 10% strengthening of the Australian dollar at 30 June
2020 against the USD would have resulted in an increased loss of $85 (2019: $46,600). A 10%
weakening of the AUD would have resulted in a decreased loss of $94 (2019: $46,600), assuming all
other variables remain constant. The Group does not currently hedge against currency risk.
18.
Key management personnel disclosures
Key management personnel compensation
Short-term employee benefits
Post-employment benefits
Share based payments
Consolidated Group
2020
$
607,388
41,640
64,939
713,967
2019
$
921,541
47,404
16,689
985,634
Detailed remuneration disclosures are provided in sections 1 to 4 of the Remuneration Report in the
Directors’ Report.
Apart from the Company’s directors, the Group had no employees as at 30 June 2020 (30 June 2019:
2 employees).
63
Notes to Financial Statements for the financial year ended 30 June 2020
19.
Remuneration of auditors
During the year the following fees (exclusive of GST) were paid or
payable for services provided by the auditor of the Group:
Audit services
- Audit and review of financial report and other
audit work under the Corporations Act 2001
- Over provision of audit fees for prior year
Non-audit services
- Other services provided
Total remuneration for audit and other services
Consolidated Group
2020
$
2019
$
39,425
50,673
(770)
-
-
-
38,655
50,673
The auditors of Metalicity Limited and its subsidiaries is Stantons International.
20. Contingent liabilities
The Company has entered into an Agreement with Harbury Advisors Pty Ltd to assist with the
divestment of the Company’s interest in the Admiral Bay project. Harbury Advisors Pty Ltd are paid a
retainer of $15,000 a month (exclusive of GST) and will be paid a success fee of 6% of the Asset Value
on successful completion.
The Company is currently seeking legal advice on proceedings undertaken within the state of Minnesota
, United States of America concerning Portland Orthopaedics Limited activities. The company remains
unaware of the potential financial impact other than that the US Complaint (equivalent to statement of
claim) has a pleading that the plaintiff’s claim “exceeds the sum or value of US$75,000, exclusive of
interest and costs”, which the Company have been informed by the US lawyers that this is a jurisdictional
requirement and is not a pleading of the actual amount of the claim, and the plaintiff’s lawyers have not
otherwise given an indication of the value of the claim. At the date of this report, the amount and
probability of any claim is not determinable.
64
Notes to Financial Statements for the financial year ended 30 June 2020
21. Commitments for expenditure
(a) Exploration Commitments
In order to maintain an interest in the mining and exploration tenements in which the Group is involved,
the Group is committed to meet the conditions under which the tenements were granted and the
obligations of any joint venture agreements. The timing and amount of exploration expenditure
commitments and obligations of the Group are subject to the minimum expenditure commitments
required as per the Mining Act, as amended, and may vary significantly from the forecast based upon
the results of the work performed which will determine the prospectivity of the relevant area of interest.
These obligations are not provided for in the financial report and are payable.
Outstanding exploration commitments are as follows (other than detailed below, no estimate has been
given of expenditure commitments beyond 12 months as this is dependent on the Directors' ongoing
assessment of operations and, in certain circumstances, Native Title negotiations):
Consolidated Group
2019
$
321,580
3,847,551
-
4,169,131
2018
$
1,217,400
-
-
1,217,400
Not longer than 1 year
Longer than 1 year and not longer than 5 years
Longer than 5 years
(b) Operating Lease Commitments
The Group has no operating leases at 30 June 2020.
22.
Related Party transactions
(a) Key management personnel
During the year ended 30 June 2020, there were no related party transactions with key management
personnel.
All other disclosures relating to key management personnel are set out in Note 18 and in the detailed
remuneration disclosures in the Directors’ Report.
(b) Transaction with related parties
There were no transactions with related parties other than with key management personnel as noted
above.
(c) Outstanding balances arising from sales / purchases of goods and services
There are no balances owing to or from related parties at 30 June 2020 (2019: $Nil).
65
Notes to Financial Statements for the financial year ended 30 June 2020
23. Earnings per share
Consolidated Group
(a) Basic earnings
per share
Loss from continuing operations attributable to the ordinary
equity holders of the Company
(b) Diluted earnings/(loss) per share
Loss from continuing operations attributable to the ordinary
equity holders of the Company
(c) Reconciliation of profit/(loss) used in calculating
earnings per share
Basic and diluted profit/(loss) per share
Loss from continuing operations attributable to the ordinary
equity holders of the Company
Loss from discontinued operations
(d) Weighted average number of shares used as the
denominator
Weighted average number of ordinary shares used as the
denominator in calculating basic earnings/(loss) per share
Adjustment for calculation of diluted profit/(loss) per share -
Options
Weighted average number of ordinary shares and potential
ordinary shares used as the denominator in calculating
diluted earnings/(loss) per share
2020
Cents
(0.17)
(0.17)
(0.17)
(0.17)
2020
$
(1,274,669)
-
(1,274,669)
2020
Number
2019
Cents
(0.7)
(0.7)
(0.7)
(0.7)
2019
$
(4,190,963)
-
(4,190,963)
2019
Number
770,501,748
599,998,774
-
-
770,501,748
599,998,774
As the Group made a loss for the years ended 30 June 2020 and 30 June 2019, the options on issue
have no dilutive effect. Therefore, dilutive loss per share is equal to basic loss per share.
24. Group entities
Parent entity
Metalicity Limited
Subsidiary
Stuart Town Gold Pty Ltd
Metalicity Energy Pty Ltd
KYM Mining Pty Ltd
Kimberley Mining Limited(1)
Ridgecape Holdings Pty Ltd(1)
Kimberley Mining Australia Pty Ltd(1)
Kimberley Mining Holdings Pty Ltd(1)
Country of
incorporation
Interest
2020
Interest
2019
Australia
Australia
Australia
Australia
Canada
Australia
Australia
Australia
-
100%
100%
~80.3%
~80.3%
~80.3%
~80.3%
100%
100%
-
~81%
~81%
~81%
~81%
(1)Metalicity Limited holds ~80.3% interest in Kimberley Mining Limited, and its wholly owned
subsidiaries, with outside equity interest holding the remaining ~19.7%. The outside equity interest in
Kimberley Mining Limited equates to ~6.7% of the net assets of the Group, being $217,870 at 30 June
2020 (2019: $249,936).
66
Notes to Financial Statements for the financial year ended 30 June 2020
25. Parent entity information
Statement of financial position
As at 30 June 2020
ASSETS
Total current assets
Total non-current assets
TOTAL ASSETS
LIABILITIES
Total current liabilities
TOTAL LIABILITIES
NET ASSETS
EQUITY
Contributed equity
Other reserves
Accumulated losses
TOTAL EQUITY
Profit/(Loss) of the parent entity
Total comprehensive (loss) of the parent entity
Parent
2020
$
1,279,724
2,990,986
4,270,710
804,449
804,449
3,466,261
48,568,493
2,271,043
(47,373,275)
3,466,261
(4,695,136)
(4,695,136)
Parent
2019
$
1,168,492
5,373,010
6,541,502
220,597
220,597
6,320,905
46,955,647
2,043,397
(42,678,139)
6,320,905
1,643,517
1,643,517
The parent entity has not provided any guarantees or become responsible for contingent liabilities or
contractual commitments of its subsidiaries, other than those disclosed in this financial report.
27. Subsequent events
Other than the following, the directors are not aware of any significant events since the end of the
reporting period which significantly affect or could significantly affect the operations of the consolidated
entity in future financial years:
- On 16 July 2020, the Company announced the conversion of 13,802,941 options at various
option prices, raising $142,120.
- On 24 July 2020, the Company announced the conversion of 2,148,014 options at $0.004 and
15,508 options at $0.015, raising $8,825.
- On 10 August 2020, the Company announced the conversion of 877,445 options at $0.004 and
246,300 options at $0.015, raising $7,20.
- On 20 August 2020, the Company announced the conversion of 13,500,000 options at $0.004,
raising $54,000 and the vesting of 15 million performance rights.
- On 20 August 2020, the Company announced the shareholder approved conversion of
outstanding Director Fees into 23,882,240 fully paid ordinary shares.
- On 21 August 2020, the Company announced the issue of 177.5 million options, as approved
by shareholders at general meeting.
- On 28 August 2020, the Company announced the conversion of 2,538,168 options at $0.004
and 16,691 options at $0.015, raising $10,403.
- On 7 September 2020, Metalicity Limited announced the completion of a $5 million placement
(before costs) to existing and new sophisticated and professional investors with the issue of
208.3m shares at $0.024 and 35,000,000 options to brokers at an exercise price of $0.03.
- On 9 September 2020, the Company announced the conversion of 49,386,253 options at
$0.004 and 1,255,689 options at $0.015, raising $216,380 and the vesting of 1,000,000
performance rights.
- On 24 September 2020, the Company announced the appointment of Mr Nick Day as Company
Secretary following the resignation of Mr Neil Hackett.
67
ASX Additional Information
Additional Information required by the Australian Securities Exchange Limited Listing Rules and not
disclosed elsewhere in this report is set out below.
The shareholder information was applicable as at 17 September 2020.
(a) Substantial Shareholder
There are no substantial shareholders at the date of this report.
(b) Voting Rights
Ordinary Shares
On a show of hands every member present at a meeting of shall have one vote and upon a poll each
share shall have one vote.
Options
There are no voting rights attached to the options
(c) Distribution of Equity Security Holders
(i) Ordinary Shares
Category
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Total
Ordinary Fully Paid Shares
296,179
792,194
971,379
112,194,689
1,615,692,045
1,729,946,486
% Issued Capital
0.02
0.05
0.06
6.49
93.40
100.00
There were 7,622,685 unmarketable parcel of ordinary shares.
(ii) Listed Options
Category
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Total
Listed Options
6,948
37,223
108,854
5,748,534
327,290,910
333,192,469
% of Listed Options
0.00
0.01
0.03
1.73
98.23
100.00
68
ASX Additional Information
(d) Equity Security Holders
(i) Ordinary Shares
The names of the twenty largest ordinary fully paid shareholders at 17 September 2020 are:
1.
1.1.
2.
2.
3.
3.
3.
CITICORP NOMINEES PTY LIMITED
E C DAWSON SUPER PTY LTD
LOKTOR HOLDINGS PTY LTD
4.
ARDEA RESOURCES LIMITED
5. MR JASON NEWTON LIVINGSTONE
5.5.
5.5.
6.
6.
6.
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
7. MR DAVID KENLEY
7.
7.
8. MR ZHANGHE CHEN
8.
8.8.
8.
9.
9.
9.9.
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
COVENTINA HOLDINGS PTY LTD
10
10
10
11.
FMG PILBARA PTY LTD
12. MR CHEYNE MICHAEL DUNFORD
12.
13. MR ANDREW DALEY & MRS INEKE DALEY
13.
13.
14.
14.
14.
KAGARA LTD
15.
15.15.
15.15.
15.
16.
16.
TROMSO PTY LIMITED
BNP PARIBAS NOMINEES PTY LTD
17. DR LOUISE ANN CULLEN
17.
17.17.
18. HOGHTON SUPERFUND PTY LTD
18.18.
18.18.
18.
19. MR GREGORY JAMES MILLER
19.
19.
19.
20. NEWECONOMY COM AU NOMINEES PTY LIMITED <900 ACCOUNT>
20.20.20.20.20.
Total
Number
Held
37,665,515
34,773,687
34,406,250
33,843,825
23,574,348
18,251,297
16,671,666
16,544,409
15,844,487
15,439,285
15,000,000
14,560,000
13,992,982
12,806,711
11,000,000
9,667,494
9,505,000
9,200,000
9,000,000
8,999,169
360,746,125
Percentage
of Issued
Shares
2.18
2.01
1.99
1.96
1.36
1.06
0.96
0.96
0.92
0.89
0.87
0.84
0.81
0.74
0.64
0.56
0.55
0.53
0.52
0.52
20.85
69
ASX Additional Information
(ii) Listed Option Holders
The names of the twenty largest listed option holders shareholders at 17 September 2020 are:
1.
1.1.
2.
2.
2.
3.
4.
4.
4.
5.
6.
6.
6.
PEARSE STREET PTY LTD
CG NOMINEES (AUSTALIA) PTY LTD
HISHENK PTY LTD
E C DAWSON SUPER PTY LTD
RECO HOLDINGS PTY LTD
UPSKY EQUITY PTY LTD
7. MR CHEYNE MICHAEL DUNFORD
7.
7.
8.
8.
8.8.
8.
GEORDIE BAY HOLDINGS PTY LTD
SKYWALKER HOLDINGS WA PTY LTD
9.9.
9.
9.
9.
9. MR DAVID KENLEY
9.
9.
9.9.
9. WINDELL HOLDINGS PTY LTD
9.
9.9.
9.
10
LOKTOR HOLDINGS PTY LTD
11. CRAZY DINGO PTY LTD
11.11.
12. MS EILEEN COLLINS & MR ADAM CHAMPION
12.
12.
13. MR ADAM STUART DAVEY
13.
13.
13.
13.
13.
BRU BOY PTY LTD
14. M & K KORKIDAS PTY LTD
15.
15.
15.15.
SOTIS SUPERANNUATION PTY LTD
16. MR CAJETAN FRANCIS MASCARENHAS
16.
16.16.
16.
17. MR ANTHONY JAMES HAWKINS
17.17.
17.17.
17.
17.
18. HOGHTON SUPERFUND PTY LTD
18.18.18.
18.
19. DKH WA PTY LTD
19.
19.
20. MR GREGORY JAMES MILLER
20.20.20.20.
Total
(ii) Unlisted Options
Unquoted equity securities
Unquoted equity securities
Unquoted equity securities
Unquoted equity securities
Unquoted equity securities
Unquoted equity securities
Unquoted equity securities
Options exercisable at 3 cents before 10 December 2020
Options exercisable at 3 cents before
Options exercisable at 3 cents before
Options exercisable at 3 cents before
Options exercisable at 4 cents before 10 December 2020
Options exercisable at 5 cents before 10 December 2020
Options exercisable at 5 cents before
Options exercisable at 2 cents before 31 May 2022
Options exercisable at
Options exercisable at
Options exercisable at
Options exercisable at 8 cents before 14 February 2023
Options exercisable at 8 cents before 14 February 2023
Options exercisable at 8 cents before 14 February 2023
Options exercisable at 8 cents before 14 February 2023
Options exercisable at 8 cents before 14 February 2023
Options exercisable at 8 cents before 14 February 2023
Options exercisable at 8 cents before 14 February 2023
Options exercisable at 6 cents before 12 March 2021
Options exercisable at 6 cents before 12 March 2021
Options exercisable at 6 cents before 12 March 2021
Options exercisable at 6 cents before 12 March 2021
Options exercisable at 6 cents before 12 March 2021
Options exercisable at 6 cents before 12 March 2021
Options exercisable at 8 cents before 12 March 2021
Options exercisable at 8 cents before 12 March 2021
Options exercisable at 8 cents before 12 March 2021
Options exercisable at 8 cents before 12 March 2021
Options exercisable at 8 cents before 12 March 2021
Options exercisable at 8 cents before 12 March 2021
Options exercisable at 8 cents before 12 March 2021
Options exercisable at 6 cents before 21 August 2021
Options exercisable at
Options exercisable at 8 cents before 21 August 2021
Options exercisable at
Options exercisable at 10 cents before 21 August 2021
Options exercisable at
Options exercisable at
Options exercisable at
Options exercisable at
Options exercisable at 2.5 cents before 14 January 2022
Options exercisable at 3.5 cents before 14 January 2022
Options exercisable at 1.5 cents before 4 October 2020
Options exercisable at 1.5 cents before 18 October 2020
Options exercisable at 0.3 cents before 14 August 2022
Number
Held
33,712,962
25,000,000
18,750,000
18,394,499
17,356,481
16,856,481
9,651,872
8,000,000
6,250,000
6,250,000
6,250,000
6,019,217
5,739,145
5,113,333
5,000,000
5,000,000
4,946,145
4,900,000
4,800,000
4,650,000
4,056,481
4,000,000
3,000,000
223,696,616
Percentage
of Issued
Shares
10.12
7.50
5.63
5.52
5.21
5.06
2.90
2.40
1.88
1.88
1.88
1.81
1.72
1.53
1.50
1.50
1.48
1.47
1.44
1.40
1.22
1.20
0.90
67.14
Number on Issue
3,150,000
4,550,000
4,550,000
10,785,715
25,709,467
3,000,000
3,000,000
2,500,000
2,500,000
2,500,000
2,000,000
2,000,000
6,768,765
7,913,286
25,000,000
70
ASX Additional Information
(e) Tenement List:
As at 17 September 2020
Project
TEN ID
Admiral Bay
ML04/244
Admiral Bay
ML04/249
Admiral Bay
EL04/1610
Holder
Kimberley Mining Australia Pty Ltd
100%
Kimberley Mining Australia Pty Ltd
100%
Kimberley Mining Australia Pty Ltd
100%
Granted
Expires
21/03/1991
20/03/2033
21/03/1991
20/03/2033
04/09/2007
03/09/2021
Admiral Bay
E04/2621
Metalicity Limited 100%
07/10/2019
06/10/2024
Kookynie
P40/1331
KYM Mining Pty Ltd 110%
09/04/2014
08/04/2022
71